UNITED STATES SECURITIES AND EXCHANGE COMMISSION
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Washington, DC 20549
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______________________
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FORM 8-K
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CURRENT REPORT PURSUANT
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TO SECTION 13 OR 15(D) OF THE
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SECURITIES EXCHANGE ACT OF 1934
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November 4, 2015
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Date of Report (Date of earliest event reported)
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BOVIE MEDICAL CORPORATION
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(Exact name of registrant as specified in its Charter)
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Delaware
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012183
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11-2644611
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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4 Manhattanville Road, Suite 106
Purchase, New York 10577
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(Address of principal executive offices) (Zip Code)
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(914) 468-4009
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Registrant's telephone number, including area code
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o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02
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Results of Operations and Financial Condition
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Item 9.01
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Financial Statements and Exhibits
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Exhibit No.
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Description
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99.1
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Press release dated November 4, 2015.
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Date: November 5, 2015
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BOVIE MEDICAL CORPORATION
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By: /s/ Robert L. Gershon
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Robert L. Gershon
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Chief Executive Officer
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Total Sales increased 15.3% year-on-year; Gross margin was 41.3%
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J-Plasma sales of $505,000 exceeded total sales for first half 2015
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Expanded Medical Advisory Board with world renowned leaders in the fields of cardiovascular and cardiothoracic surgery
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Strengthened supply chain and product development efficiencies with purchase of R&D and Manufacturing Contractor in Bulgaria in mid-October
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J-Plasma® Operating Metrics
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Generators in use increased 82% to 62, up from 34 at end of Q2
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79 Scrub Purchase Orders, almost double the 42 for first half 2015
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Systems approved by 59 Hospital Value Analysis Committees (VACs), up from 42 at end of Q2; under review by 64 additional VACs
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Bovie announced the purchase of its Bulgarian R&D and manufacturing contractor (“Bovie Bulgaria”) for approximately $566,000 in cash. Bovie Bulgaria operates a 16,000 square foot ISO13485 certified and FDA registered manufacturing facility located in the capital city of Sofia, which houses manufacturing, development and assembly operations. The transaction gives Bovie full control over this important part of its product development and supply chain, particularly with respect to R&D for advanced surgical energy technology including key components of its J-Plasma® product line.
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Bovie received FDA 510(k) clearance for six new hand piece configurations that expand its J-Plasma® pistol grip portfolio, by expanding the range of instrument lengths and adding a new needle configuration to the standard blade configuration.
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The Bovie® Ultimate™ Operating Room Generator was named an “Innovation of the Year” by The Society of Laparoendoscopic Surgeons (SLS) on September 2, 2015.
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Bovie signed its first group purchasing organization (GPO) agreement with Amerinet, one of the nation’s largest healthcare GPOs, for the use of J-Plasma® by its members. Amerinet has more than 85,000 members, including 33,000 clinics, 3,500 acute care hospitals, and 3,300 ambulatory surgery centers.
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Jay Ewers was named Chief Financial Officer. Mr. Ewers has served as interim CFO since mid-June of this year and was previously the Company’s Corporate Controller.
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Dr. Husam H. Balkhy, is Director of Robotic and Minimally Invasive and Cardiac Surgery, and Associate Professor of Surgery at The University of Chicago Medicine. Recognized as a pioneer in the field, he specializes in cardiac diseases, using robotic and less invasive techniques to reduce pain, disability, and recovery time.
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Dr. Robert J. Cerfolio is an internationally recognized expert in robotic thoracic surgery. He received the James H. Estes Family Lung Cancer Research Endowed Chair in 2010, and Dr. Cerfolio is currently Professor of Surgery and Section Chief of Thoracic Surgery in the Division of Cardiothoracic Surgery, at the University of Alabama Hospital in Birmingham.
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BOVIE MEDICAL CORPORATION
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CONSOLIDATED STATEMENTS OF OPERATIONS
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FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2015 AND 2014
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(unaudited) (in thousands except per share data)
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Three Months Ended
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Nine Months Ended
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September 30,
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September 30,
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2015
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2014
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2015
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2014
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Sales
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$ | 7,823 | $ | 6,788 | $ | 21,226 | $ | 20,214 | ||||||||
Cost of sales
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4,594 | 4,869 | 12,183 | 13,662 | ||||||||||||
Gross profit
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3,229 | 1,919 | 9,043 | 6,552 | ||||||||||||
Other costs and expenses:
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Research and development
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583 | 368 | 1,534 | 1,019 | ||||||||||||
Professional services
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427 | 142 | 1,070 | 686 | ||||||||||||
Salaries and related costs
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1,929 | 1,653 | 5,749 | 3,980 | ||||||||||||
Selling, general and administrative
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2,103 | 2,123 | 6,325 | 4,923 | ||||||||||||
Total other costs and expenses
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5,042 | 4,286 | 14,678 | 10,608 | ||||||||||||
Loss from operations
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(1,813 | ) | (2,367 | ) | (5,635 | ) | (4,056 | ) | ||||||||
Interest expense, net
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(40 | ) | (41 | ) | (120 | ) | (111 | ) | ||||||||
Change in fair value of liabilities, net
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266 | (1,676 | ) | 1,800 | (9,820 | ) | ||||||||||
Total other income (expense), net
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226 | (1,717 | ) | 1,680 | (9,931 | ) | ||||||||||
Loss before income taxes
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(1,587 | ) | (4,084 | ) | (3,955 | ) | (13,987 | ) | ||||||||
Provision for (recovery of) income taxes, net
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-- | 1,350 | (8 | ) | 1,895 | |||||||||||
Net loss
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$ | (1,587 | ) | $ | (2,734 | ) | $ | (3,963 | ) | $ | (12,092 | ) | ||||
Accretion on convertible preferred stock
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-- | (242 | ) | (222 | ) | (668 | ) | |||||||||
Gain on conversion of warrants and preferred shares, net
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-- | -- | 13,956 | -- | ||||||||||||
Net income (loss) attributable to common shareholders
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$ | (1,587 | ) | $ | (2,976 | ) | $ | 9,771 | $ | (12,760 | ) | |||||
Income (loss) per share
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Basic
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(0.06 | ) | (0.17 | ) | 0.42 | (0.72 | ) | |||||||||
Diluted
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(0.06 | ) | (0.17 | ) | 0.31 | (0.72 | ) | |||||||||
Weighted average number of shares outstanding- basic
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27,051 | 17,780 | 23,414 | 17,727 | ||||||||||||
Weighted average number of shares outstanding - dilutive
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27,051 | 17,780 | 26,346 | 17,727 |
Bovie Medical Corporation
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Consolidated Balance Sheets
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(in thousands)
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September 30,
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December 31,
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2015
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2014
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(Unaudited)
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Current assets:
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Cash and cash equivalents
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$ | 13,202 | $ | 5,733 | ||||
Restricted cash
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839 | 899 | ||||||
Trade accounts receivable, net
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2,524 | 1,992 | ||||||
Inventories, net
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6,130 | 5,727 | ||||||
Current portion of deposits
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172 | 210 | ||||||
Prepaid expenses and other current assets
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826 | 804 | ||||||
Total current assets
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23,693 | 15,365 | ||||||
Property and equipment, net
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6,985 | 6,947 | ||||||
Brand name and trademark
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1,510 | 1,510 | ||||||
Purchased technology and license rights, net
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350 | 431 | ||||||
Deposits, net of current portion
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140 | 165 | ||||||
Other assets
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444 | 415 | ||||||
Total assets
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$ | 33,122 | $ | 24,833 | ||||
Bovie Medical Corporation
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Consolidated Balance Sheets
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(Continued) (in thousands)
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September 30,
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December 31,
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2015
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2014
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Current liabilities:
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(unaudited)
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Accounts payable
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$ | 2,341 | $ | 1,553 | ||||
Accrued payroll
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113 | 197 | ||||||
Accrued vacation
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257 | 181 | ||||||
Current portion of mortgage note payable
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239 | 239 | ||||||
Accrued and other liabilities
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1,712 | 1,596 | ||||||
Total current liabilities
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4,662 | 3,766 | ||||||
Mortgage note payable, net of current portion
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2,994 | 3,173 | ||||||
Deferred rents
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20 | 23 | ||||||
Deferred tax liability
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563 | 564 | ||||||
Derivative liabilities
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266 | 12,613 | ||||||
Total liabilities
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8,505 | 20,139 | ||||||
Series A 6% convertible preferred stock, par value $0.001; 3,500,000 shares authorized, zero issued and outstanding as of September 30, 2015
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-- | 3,190 | ||||||
Stockholders' equity:
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Series B convertible preferred stock, par value $.001; 3,588,139 issued and 1,975,639 outstanding as of September 30, 2015
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2 | -- | ||||||
Common stock, par value $.001 par value; 40,000,000 shares authorized; 27,194,251 issued and 27,051,172 outstanding as of September 30, 2015 and 17,995,409 issued and 17,852,330 outstanding as of December 31, 2014, respectively
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27 | 18 | ||||||
Additional paid-in capital
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42,664 | 29,334 | ||||||
Accumulated deficit
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(18,076 | ) | (27,848 | ) | ||||
Total stockholders' equity
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24,617 | 1,504 | ||||||
Total liabilities and stockholders' equity
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$ | 33,122 | $ | 24,833 | ||||
RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL MEASURES
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Three Months Ended
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Nine Months Ended
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September 30,
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September 30,
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(Amounts in '000's except earnings per share)
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2015
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2014
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2015
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2014
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(unaudited)
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(unaudited)
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(unaudited)
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(unaudited)
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Net Income/(loss) GAAP Basis
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$ | (1,587 | ) | $ | (2,734 | ) | $ | (3,963 | ) | $ | (12,092 | ) | ||||
Accretion on convertible preferred stock
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- | (242 | ) | (222 | ) | (668 | ) | |||||||||
Deemed dividend on conversion of warrants and Series A convertible preferred to Series B convertible preferred stock
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- | - | 13,956 | - | ||||||||||||
Net income/(loss) attributable to common shareholders
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$ | (1,587 | ) | $ | (2,976 | ) | $ | 9,771 | $ | (12,760 | ) | |||||
Net income/(loss) per share - basic (GAAP basis)
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$ | (0.06 | ) | $ | (0.17 | ) | $ | 0.42 | $ | (0.72 | ) | |||||
Other non-GAAP adjustments:
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(Gain)/loss on change in fair value of derivative liabilities
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$ | (266 | ) | $ | 1,676 | $ | (1,800 | ) | $ | 9,820 | ||||||
Increase in inventory E&O reserve and other inventory adjustments
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$ | - | $ | 796 | $ | - | $ | 1,639 | ||||||||
CFO transition costs
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$ | - | $ | - | $ | - | $ | 340 | ||||||||
A/R write off and other administrative charges
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$ | - | $ | 175 | $ | - | $ | 175 | ||||||||
Other administrative expenses
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$ | - | $ | - | $ | - | $ | 43 | ||||||||
Accretion on convertible preferred shares
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$ | - | $ | 242 | $ | 222 | $ | 668 | ||||||||
Tax impact on non-GAAP adjustments
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$ | - | $ | (378 | ) | $ | - | $ | (1,663 | ) | ||||||
Gain on conversion of warrants and Series A convertible preferred to
Series B convertible preferred stock
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- | - | (13,956 | ) | - | |||||||||||
Adjusted non-GAAP net income/(loss)
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$ | (1,853 | ) | $ | (465 | ) | $ | (5,763 | ) | $ | (1,738 | ) | ||||
Income/(loss) per share - basic on: (Note 1)
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(Gain)/loss on change in fair value of derivative liabilities
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$ | (0.01 | ) | $ | 0.09 | $ | (0.08 | ) | $ | 0.55 | ||||||
Increase in inventory E&O reserve and other inventory adjustments
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$ | - | $ | 0.04 | $ | - | $ | 0.09 | ||||||||
CFO transition costs
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$ | - | $ | - | $ | - | $ | 0.02 | ||||||||
A/R write off and other administrative charges
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$ | - | $ | 0.01 | $ | - | $ | 0.01 | ||||||||
Other administrative expenses
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$ | - | $ | - | $ | - | $ | - | ||||||||
Accretion on convertible preferred shares
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$ | - | $ | 0.01 | $ | 0.01 | $ | 0.04 | ||||||||
Tax impact on non-GAAP adjustments
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$ | - | $ | (0.02 | ) | $ | - | $ | (0.09 | ) | ||||||
Deemed dividend on conversion of warrants and Series A convertible
preferred to Series B convertible preferred stock
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- | - | (0.60 | ) | - | |||||||||||
Adjusted non-GAAP net (loss) per share -basic
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$ | (0.07 | ) | $ | (0.04 | ) | $ | (0.25 | ) | $ | (0.10 | ) | ||||
Weighted average number of shares outstanding - basic
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27,051 | 17,780 | 23,414 | 17,727 | ||||||||||||
(Note 1) Amounts reflected in the presentation of EPS calculations may be impacted by rounding
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