SEC Info - Biolase, Inc - ‘10-Q’ for 9/30/13

Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Quarterly Report                                    HTML    543K 
 2: EX-4        Ex-4.2                                              HTML     65K 
 3: EX-4        Ex-4.3                                              HTML     63K 
 4: EX-10       Ex-10.4                                             HTML     47K 
 5: EX-31       Ex-31.1                                             HTML     27K 
 6: EX-31       Ex-31.2                                             HTML     28K 
 7: EX-32       Ex-32.1                                             HTML     21K 
 8: EX-32       Ex-32.2                                             HTML     22K 
64: R1          Document and Entity Information                     HTML     41K 
45: R2          Consolidated Balance Sheets                         HTML    136K 
42: R3          Consolidated Balance Sheets (Parenthetical)         HTML     48K 
17: R4          Consolidated Statements Of Operations And           HTML    105K 
                Comprehensive Loss                                               
44: R5          Consolidated Statements Of Cash Flows               HTML    144K 
31: R6          Basis of Presentation                               HTML     55K 
57: R7          Recent Accounting Pronouncements                    HTML     30K 
32: R8          Stock-Based Awards and Per Share Information        HTML    222K 
34: R9          Inventory                                           HTML     37K 
18: R10         Property, Plant, and Equipment                      HTML     53K 
33: R11         Intangible Assets and Goodwill                      HTML    101K 
56: R12         Accrued Liabilities and Deferred Revenue            HTML    110K 
52: R13         Lines Of Credit and Other Borrowings                HTML     55K 
43: R14         Commitments and Contingencies                       HTML     42K 
61: R15         Segment Information                                 HTML     56K 
55: R16         Concentrations                                      HTML     28K 
15: R17         Income Taxes                                        HTML     41K 
20: R18         Subsequent Event                                    HTML     22K 
60: R19         Accounting Policies (Policies)                      HTML    114K 
63: R20         Stock-Based Awards and Per Share Information        HTML    192K 
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65: R21         Inventory (Tables)                                  HTML     34K 
62: R22         Property, Plant, and Equipment (Tables)             HTML     49K 
47: R23         Intangible Assets and Goodwill (Tables)             HTML     93K 
19: R24         Accrued Liabilities and Deferred Revenue (Tables)   HTML    116K 
30: R25         Segment Information (Tables)                        HTML     47K 
23: R26         Basis of Presentation - Additional Information      HTML     67K 
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22: R27         Classification of Compensation Expense Associated   HTML     29K 
                with Share-Based Payments (Detail)                               
36: R28         Assumptions Used in Estimating Fair Value of Stock  HTML     32K 
                Options Granted (Detail)                                         
46: R29         Summary of Option Activity (Detail)                 HTML     72K 
53: R30         Cash Proceeds Along with Fair Value Disclosures     HTML     39K 
                Related to grants Exercises and Vesting Options                  
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27: R31         Stock Based Awards and Per Share Information -      HTML    115K 
                Additional Information (Detail)                                  
37: R32         Components of Inventory (Detail)                    HTML     32K 
59: R33         Inventory - Additional Information (Detail)         HTML     25K 
25: R34         Summary of Property, Plant, and Equipment (Detail)  HTML     36K 
50: R35         Property, Plant, and Equipment - Additional         HTML     22K 
                Information (Detail)                                             
51: R36         Intangible Assets Related to Accumulated            HTML     52K 
                Amortization and Goodwill (Detail)                               
38: R37         Intangible Assets and Goodwill - Additional         HTML     24K 
                Information (Detail)                                             
21: R38         Components of Accrued Liabilities (Detail)          HTML     43K 
49: R39         Changes In Initial Product Warranty Accrual and     HTML     38K 
                Expenses Under Initial and Extended Warranties                   
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26: R40         Summary of Deferred Revenue (Detail)                HTML     37K 
35: R41         Lines of Credit and Other Borrowings - Additional   HTML    111K 
                Information (Detail)                                             
54: R42         Commitments and Contingencies - Additional          HTML     32K 
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29: R43         Summary of Net Revenue by Geographic Location       HTML     24K 
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48: R44         Segment Information - Additional Information        HTML     30K 
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41: R45         Concentrations - Additional Information (Detail)    HTML     31K 
24: R46         Income Taxes - Additional Information (Detail)      HTML     57K 
58: R47         Subsequent Event - Additional Information (Detail)  HTML     21K 
40: XML         IDEA XML File -- Filing Summary                      XML     91K 
16: EXCEL       IDEA Workbook of Financial Reports                  XLSX    134K 
39: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS   1.26M 
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11: EX-101.CAL  XBRL Calculations -- biol-20130930_cal               XML    132K 
12: EX-101.DEF  XBRL Definitions -- biol-20130930_def                XML    710K 
13: EX-101.LAB  XBRL Labels -- biol-20130930_lab                     XML    998K 
14: EX-101.PRE  XBRL Presentations -- biol-20130930_pre              XML    800K 
10: EX-101.SCH  XBRL Schema -- biol-20130930                         XSD    161K 
28: ZIP         XBRL Zipped Folder -- 0001564590-13-001200-xbrl      Zip    135K

‘R19’ — Accounting Policies (Policies)

This is an IDEA Financial Report. [ Alternative Formats ]

Accounting Policies (Policies)	9 Months Ended
Accounting Policies (Policies)	Sep. 30, 2013
Basis of Presentation	Basis of Presentation The unaudited consolidated financial statements include the accounts of BIOLASE, Inc. and its wholly-owned subsidiaries and have been prepared on a basis consistent with the December 31, 2012 audited consolidated financial statements and include all material adjustments, consisting of normal recurring adjustments and the elimination of all material intercompany transactions and balances, necessary to fairly present the information set forth therein. These unaudited, interim, consolidated financial statements do not include all the footnotes, presentations, and disclosures normally required by accounting principles generally accepted in the United States of America (“GAAP”) for complete consolidated financial statements. Certain amounts have been reclassified to conform to current period presentations. The consolidated results of operations for the three and nine months ended September 30, 2013 are not necessarily indicative of the results for the full year. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2012, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Form 10-K”) filed with the Securities and Exchange Commission on March 15, 2013.
Use of Estimates	Use of Estimates The preparation of these consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect amounts reported in the consolidated financial statements and the accompanying notes. Significant estimates in these consolidated financial statements include allowances on accounts receivable, inventory, and deferred taxes, as well as estimates for accrued warranty expenses, indefinite-lived intangible assets, and the ability of goodwill to be realized, revenue deferrals for multiple element arrangements, effects of stock-based compensation and warrants, contingent liabilities, and the provision or benefit for income taxes. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ materially from those estimates.
Update to Significant Accounting Policies	Update to Significant Accounting Policies There have been no material changes to the Company’s significant accounting policies which are described in the Company’s 2012 Form 10-K, except as noted below. See Note 2 – Recent Accounting Pronouncements for adoption of updated authoritative guidance.
Excise Tax	Excise Tax Commencing January 1, 2013, certain of the Company’s product sales are subject to the newly enacted medical device excise tax. The Company has included such taxes separately as a component of operating expense.
Income Tax	Income Tax The income tax provision for the three and nine months ended September 30, 2013 was calculated using the discrete year-to-date method, which management determined to be more appropriate than the annual effective rate method which was used to calculate the income tax provision for the quarter ended March 31, 2013. See Note 12 – Income Taxes for additional disclosures related to the Company’s income tax.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company’s financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities, approximate fair value because of the short maturity of these items. Financial instruments consisting of lines of credit approximate fair value, as the interest rates associated with the lines of credit approximates the market rates for debt securities with similar terms and risk characteristics.
Liquidity and Management's Plans	Liquidity and Management’s Plans The Company suffered recurring losses from operations during the three years ended December 31, 2012. The Company also incurred a loss from operations, a net loss, and used cash in operating activities for the three and nine months ended September 30, 2013. The available borrowing capacity on our lines of credit with Comerica Bank and the net proceeds from the below mentioned equity offering have been principal sources of liquidity during the nine months ended September 30, 2013. These credit facilities were amended in November 2013, as discussed further below, and expire May 1, 2014. At September 30, 2013, the Company had approximately $5.0 million in working capital. The Company’s principal sources of liquidity at September 30, 2013 consisted of approximately $4.2 million in cash and cash equivalents, $10.8 million of net accounts receivable, and $2.5 million of available borrowings under two revolving credit facility agreements. The Company’s ability to meet its obligations in the ordinary course of business is dependent upon the Company’s ability to sell its products directly to end-users and through distributors, establish profitable operations through increased sales, decrease expenses, and to generate cash from operations or obtain additional funds when needed. If the Company is unsuccessful in its efforts to improve its financial position, there may be substantial doubt about its ability to adequately fund the minimum requirements of its business. The Company intends to improve its financial condition and ultimately improve its financial results by increasing revenues through expansion of its product offerings, continuing to develop its direct sales force and distributor relationships both domestically and internationally, forming strategic arrangements within the dental and medical industries, educating dental and medical patients as to the benefits of its advanced medical technologies, and continuing cost reduction initiatives. Management expects that the working capital and future borrowings available under the lines of credit should be sufficient to fund the minimum requirements of the Company; however, the Company cannot guarantee that it will be able to increase sales, reduce expenses, or obtain additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. Management will continue to monitor the liquidity of the Company and is prepared to implement cash saving measures or potentially issue debt or equity securities in the event that its plans to grow revenue do not materialize in the timeline anticipated by management. Sale of common stock On July 26, 2013, the Company filed a registration statement on Form S-3, File No. 333-190158 (“2013 Registration Statement”) with the Securities and Exchange Commission (“SEC”) to register an indeterminate number of shares of common stock, preferred stock, and warrants with a total offering price not to exceed $30 million. The Company subsequently amended the 2013 Registration Statement and lowered the total not to exceed offering price to $5 million. The 2013 Registration Statement, as amended, was declared effective by the SEC on September 19, 2013. On September 23, 2013, the Company entered into an agreement with Northland Securities, Inc. (“Northland”), pursuant to which Northland acted as placement agent in connection with the sale of shares of the Company’s common stock in a registered direct offering (the “September 2013 Registered Direct Offering”) pursuant to the 2013 Registration Statement and paid Northland a fee of 5.0% of the aggregate gross proceeds in connection therewith. On September 23, 2013, the Company entered into a subscription agreement (“2013 Subscription Agreement”) with Camber Capital Management, LLC, pursuant to which the Company agreed to sell 2,688,172 shares of its common stock at a price per share of $1.86 for gross proceeds of $5 million. The net proceeds to the Company were $4.6 million, after deducting associated costs of $408,000, which included Northland’s fee. The shares of common stock sold in connection with the 2013 Subscription Agreement were issued pursuant to a prospectus supplement to the 2013 Registration Statement, which was filed with the SEC September 26, 2013. Lines of credit On September 6, 2013 and November 8, 2013, the Company amended its lines of credit with Comerica Bank. The amendments waive noncompliance with certain financial covenants, subject to additional requirements, and establish future covenants, restrictions, and penalties. The amendment on November 8, 2013 includes liquidity ratio and liquid asset covenants, and an equity raise requirement that established March 1, 2014 as the latest date by which the Company is required to raise at least $3.0 million. Any future noncompliance with these covenants may result in default interest rates and penalties, and Comerica Bank could declare the amounts outstanding immediately due and payable. Management is considering alternative financing solutions, including potentially issuing alternative debt securities, to mitigate any future liquidity constraints these covenants and restrictions may impose on the Company. Further discussion of the amendments is included in Note 8 – Lines of Credit and Other Borrowings.
Newly Adopted Accounting Standards	Newly Adopted Accounting Standards In July 2012, the FASB simplified guidance for testing for impairment of indefinite-lived intangible assets other than goodwill. The changes are intended to reduce compliance costs. The revised guidance allows a qualitative approach for testing indefinite-lived intangible assets for impairment, similar to the recently issued impairment testing guidance for goodwill and allows the option to first assess qualitative factors (events and circumstances) that could have affected the significant inputs used in determining the fair value of the indefinite-lived intangible asset to determine whether it is more likely than not (meaning a likelihood of more than 50 percent) that the indefinite-lived intangible asset is impaired. An organization may choose to bypass the qualitative assessment for any indefinite-lived intangible asset in any period and proceed directly to calculating its fair value. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The adoption did not have a material impact on the Company’s consolidated financial statements. In February 2013, the FASB issued guidance for reporting of amounts reclassified out of accumulated other comprehensive income. The revised guidance requires reporting the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required to be reclassified in its entirety to net income. For other amounts that are not required to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures that provide additional detail about these amounts. The amendments do not change the current requirements for reporting net income or other comprehensive income in financial statements. The guidance is effective prospectively for reporting periods beginning after December 15, 2012. The adoption did not have a material impact on the Company’s consolidated financial statements.
New Accounting Standards Not Yet Adopted	New Accounting Standards Not Yet Adopted In March 2013, the FASB issued guidance on a parent’s accounting for the cumulative translation adjustment upon de-recognition of certain subsidiaries or groups of assets within a foreign entity or of an investment in a foreign entity. The revised guidance requires that the parent release any related cumulative translation adjustment into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. The guidance is effective prospectively for reporting periods beginning after December 15, 2013. Early adoption is permitted. Management believes that the adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In July 2013, the FASB issued guidance to address the diversity in practice related to the financial statement presentation of unrecognized tax benefits as either a reduction of a deferred tax asset or liability when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This guidance is effective prospectively for reporting periods beginning after December 15, 2013. Early adoption is permitted. Management believes that the adoption of this guidance will not have a material impact on the Company’s consolidated financial statements.
Inventory	Inventory is valued at the lower of cost or market (determined by the first-in, first-out method)
Commitments and Contingencies	Litigation The Company discloses material loss contingencies deemed to be reasonably possible and accrues for loss contingencies when, in consultation with its legal advisors, management concludes that a loss is probable and reasonably estimable. The ability to predict the ultimate outcome of such matters involves judgments, estimates, and inherent uncertainties. The actual outcome of such matters could differ materially from management’s estimates.
Income Tax Uncertainties	Accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has elected to classify interest and penalties as a component of its income tax provision. With respect to the liability for unrecognized tax benefits, including related estimates of penalties and interest, the Company recorded increases of $0 and $1,000 for the three and nine months ended September 30, 2013, respectively, and $2,000 and $4,000 for the three and nine months ended September 30, 2012, respectively.

Dates Referenced Herein and Documents Incorporated by Reference

This ‘10-Q’ Filing	Date	Other Filings

	5/1/14
	3/1/14
	12/15/13
Filed on:	11/12/13	8-K
	11/8/13
For Period end:	9/30/13
	9/26/13	424B5
	9/23/13	8-K
	9/19/13	8-K/A, CORRESP, EFFECT, S-3/A
	9/6/13	8-K, 8-K/A
	7/26/13	S-3
	3/31/13	10-Q
	3/15/13	10-K
	1/1/13
	12/31/12	10-K
	12/15/12
	9/30/12	10-Q
	9/15/12
	9/15/09
		List all Filings

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Filing Submission 0001564590-13-001200 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Biolase, Inc – ‘10-Q’ for 9/30/13 – ‘R19’

On: Tuesday, 11/12/13, at 8:52am ET · For: 9/30/13 · Accession #: 1564590-13-1200 · File #: 0-19627

Previous ‘10-Q’: ‘10-Q’ on 8/9/13 for 6/30/13 · Next: ‘10-Q’ on 5/12/14 for 3/31/14 · Latest: ‘10-Q’ on 11/9/23 for 9/30/23

Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

‘R19’ — Accounting Policies (Policies)

This is an IDEA Financial Report. [ Alternative Formats ]

Dates Referenced Herein and Documents Incorporated by Reference

Biolase, Inc – ‘10-Q’ for 9/30/13 – ‘R19’

On: Tuesday, 11/12/13, at 8:52am ET · For: 9/30/13 · Accession #: 1564590-13-1200 · File #: 0-19627

Previous ‘10-Q’: ‘10-Q’ on 8/9/13 for 6/30/13 · Next: ‘10-Q’ on 5/12/14 for 3/31/14 · Latest: ‘10-Q’ on 11/9/23 for 9/30/23

Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34Filing Table of Contents

‘R19’ — Accounting Policies (Policies)

This is an IDEA Financial Report. [ Alternative Formats ]

Dates Referenced Herein and Documents Incorporated by Reference

Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents