Organization |
3 Months Ended | |
|---|---|---|
Mar. 31, 2017 | ||
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
| Organization |
1. Organization
Description of Business
The Company designs, develops, and sells exoskeletons that augment human strength, endurance, and mobility. The Company’s exoskeletons have applications in health care, industrial, military, and consumer markets. All common stock share and per share amounts have been adjusted to reflect the one-for-seven reverse stock split completed on May 4, 2016. See Note 11, Capitalization and Equity Structure – Reverse Stock Split. Liquidity Largely as a result of significant research and development activities related to the development of the Company’s advanced technology and commercialization of this technology into its medical device business, the Company has incurred significant operating losses and negative cash flows from operations since inception. The Company has also recognized significant non-cash losses associated with the revaluation of certain securities, which have also contributed significantly to its accumulated deficit. As of March 31, 2017, the Company had an accumulated deficit of $ 123,334.
Cash on hand at March 31, 2017 was $9,426 compared to $16,846 at December 31, 2016. For the three month period ended March 31, 2017, the Company used $ 7,254 of cash in operations compared to $6,789 for the three month period ended March 31, 2016. As noted in Note 9, Long-Term Debt, borrowings under our long-term debt agreement have a requirement of minimum cash on hand roughly equivalent to three months of cash burn. As of March 31, 2017, the most recent determination of this restriction, $ 6,678 of cash must remain as unrestricted, with such amounts to be re-computed at each month end period. After considering such cash restriction, effective unrestricted cash as of March 31, 2017 is estimated to be $ 2,748. In April 2017, the Company sold 3,732 shares of common stock and warrants to purchase 1,866 shares of common stock for net proceeds of approximately $10.9 million (refer to Note 17 Subsequent Events for additional information). Based on a look-forward period of one year from the date of issuance of these financial statements, and after considering the approximately $10.9 million raised in April 2017, the Company’s cash on hand will not be sufficient to satisfy its operations for the next twelve months from the date of issuance of these condensed consolidated financial statements, which raises substantial doubt about our ability to continue as a going concern. Based upon the Company’s current cash resources, cash raised in April 2017 from the sale of common stock, the recent rate of using cash for operations and investment, and assuming modest increases in current revenue offset by incremental increases in expenses related to increased sales and marketing and research and development, and a potential increase in rental activity from its medical device business, the Company believes it has sufficient resources to meet its financial obligations into the first quarter of 2018. The Company will require significant additional financing. The Company is actively pursuing opportunities to obtain additional financing in the future through public or private equity and/or debt financings, corporate collaborations, or warrant solicitations. The Company’s actual capital requirements may vary significantly and will depend on many factors. For example, the Company plans to continue to increase its investments (i) in its clinical, sales and marketing initiatives to accelerate adoption of the Ekso robotic exoskeleton in the rehabilitation market, (ii) in its research, development and commercialization activities with respect to an Ekso robotic exoskeleton for home use, and/or (iii) in the development and commercialization of able-bodied exoskeletons for industrial use. Consequently, the Company will require significant additional financing in the future, which the Company intends to raise through corporate collaborations, public or private equity offerings, debt financings, or warrant solicitations. Sales of additional equity securities by us could result in the dilution of the interests of existing stockholders. There can be no assurance that financing will be available when required in sufficient amounts, on acceptable terms or at all. In the event that the necessary additional financing is not obtained, the Company may be required to reduce its discretionary overhead costs substantially, including research and development, general and administrative, and sales and marketing expenses or otherwise curtail operations. |