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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 10-Q

 

 

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2024

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Commission File Number 001-33624

 

 

 

SINTX Technologies, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

delaware   84-1375299
(State or other jurisdiction   (IRS Employer
of incorporation or organization)   Identification No.)

 

1885 West 2100 South, Salt Lake City, UT   84119
(Address of principal executive offices)   (Zip Code)

 

(801) 839-3500

(Registrant’s telephone number, including area code)

 

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbols   Name of each exchange on which registered
Common Stock   SINT   The NASDAQ Capital Market

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days: Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files); Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

 

Large accelerated filer Accelerated filer
       
Non-accelerated filer Smaller reporting company
       
    Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

 

122,698,454 shares of common stock, $0.01 par value, were outstanding at May 8, 2024.

 

 

 

 

 

 

SINTX Technologies, Inc.

Table of Contents

 

Part I. Financial Information  
Item 1. Financial Statements  
Condensed Consolidated Balance Sheets (unaudited) 3
Condensed Consolidated Statements of Operations (unaudited) 4
Condensed Consolidated Statements of Stockholders’ Equity (unaudited) 5
Condensed Consolidated Statements of Cash Flows (unaudited) 6
Notes to Condensed Consolidated Financial Statements (unaudited) 7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 17
Item 3. Quantitative and Qualitative Disclosures About Market Risk 24
Item 4. Controls and Procedures 24
Part II. Other Information  
Item 1. Legal Proceedings 25
Item 1A. Risk Factors 25
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 25
Item 3. Defaults Upon Senior Securities 25
Item 4. Mine Safety Disclosures 25
Item 5. Other Information 25
Item 6. Exhibits 26
Signatures 27

 

2

 

 

SINTX Technologies, Inc.

Condensed Consolidated Balance Sheets - Unaudited

(in thousands, except share and per share data)

 

   March 31, 2024   December 31, 2023 
         
Assets          
Current assets:          
Cash and cash equivalents  $5,762   $3,340 
Account and other receivables, net of allowance totaling 109 and 72 respectively   483    685 
Prepaid expenses and other current assets   366    539 
Inventories   707    888 
Other current assets   196    80 
Total current assets   7,514    5,532 
           
Inventories, net   469    333 
Property and equipment, net   5,064    4,826 
Intangible assets, net   20    21 
Operating lease right of use asset   3,936    4,094 
Other long-term assets   558    559 
Total assets  $17,561   $15,365 
           
Liabilities and Stockholders’ Equity          
Current liabilities:          
Accounts payable  $448   $636 
Accrued liabilities   2,041    1,404 
Current portion of long-term debt   233    46 
Derivative liabilities   845    304 
Current portion of operating lease liability   518    512 
Other current liabilities   3    4 
Total current liabilities   4,088    2,906 
           
Operating lease liability, net of current portion   3,547    3,687 
Total liabilities   7,635    6,593 
           
Commitments and contingencies   -    - 
           
Stockholders’ equity:          
Convertible preferred stock Series B, $0.01 par value, 130,000,000 total shares authorized inclusive of all series of preferred; 26 shares issued and outstanding as of March 31, 2024 and December 31, 2023.   -    - 
Convertible preferred stock Series C, $0.01 par value, 130,000,000 total shares authorized inclusive of all series of preferred; 50 shares issued and outstanding as of March 31, 2024 and December 31, 2023.   -    - 
Convertible preferred stock Series D, $0.01 par value, 130,000,000 total shares authorized inclusive of all series of preferred; 180 shares issued and outstanding as of March 31, 2024 and December 31, 2023.   -    - 
Common stock, $0.01 par value, 250,000,000 shares authorized; 51,080,138 and 5,320,671 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.   511    53 
Additional paid-in capital   281,015    279,433 
Accumulated deficit   (271,600)   (270,714)
Total stockholders’ equity   9,926    8,772 
Total liabilities and stockholders’ equity  $17,561   $15,365 

 

The condensed consolidated balance sheet as of December 31, 2023, has been prepared using information from the audited consolidated balance sheet as of that date.

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

3

 

 

SINTX Technologies, Inc.

Condensed Consolidated Statements of Operations - Unaudited

(in thousands, except share data)

 

   2024   2023 
  

Three Months Ended March 31,

 
   2024   2023 
Product revenue  $309   $240 
Grant and contract revenue   378    299 
Total revenue   687    539 
Costs of revenue   223    118 
Gross profit   464    421 
Operating expenses:          
Research and development   2,019    2,200 
General and administrative   1,123    1,169 
Sales and marketing   246    310 
Grant expenses   273    299 
Total operating expenses   3,661    3,978 
Loss from operations   (3,197)   (3,557)
Other income (expenses):          
Interest expense   (2)   (2)
Interest income   19    38 
Change in fair value of derivative liabilities   2,838    4,006 
Offering costs of derivative liabilities   

(550

)   (786)
Other income (net)   6    8 
Total other income, net   2,311    3,264 
Net loss before income taxes   (886)   (293)
Provision for income taxes   -    - 
Net loss  $(886)  $(293)
           
Net loss per share – basic and diluted          
Basic – net loss  $(0.05)  $(0.13)
Diluted – net loss  $(0.11)  $(1.74)
Weighted average common shares outstanding:          
Basic   17,262,895    2,272,992 
Diluted   34,460,877    2,558,059 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

4

 

 

SINTX Technologies, Inc.

Condensed Consolidated Statements of Stockholders’ Equity - Unaudited

(in thousands, except share and per share data)

 

   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
   Preferred Stock   Common Stock   Paid-In   Accumulated   Total 
   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
Balance as of December 31, 2022   283   $    -    542,145   $5   $268,154   $(262,455)  $5,704 
Stock based compensation   -    -    15    -    86    -    86 
Common stock issued for cash, net of cash fees   -    -    1,980,000    20    4,437    -    4,457 
Prefunded warrants issued for cash, net of cash fees   -    -    -    -    383    -    383 
Extinguishment of derivative liability upon exercise of warrant   -    -    -    -    5,502    -    5,502 
Issuance of common stock from the exercise of prefunded warrants for cash   -    -    170,000    2    (2)   -    - 
Issuance of common stock from the cashless exercise of warrants   -    -    1,337,600    13    (13)   -    - 
Redemption of preferred stock   (1)   -    -    -    (2)   -    (2)
Issuance of agent warrants   -    -    -    -    108    -    108 
Round up shares issued in reverse split   -    -    20,475    -    -    -    - 
Net loss   -    -    -    -    -    (293)   (293)
Balance as of March 31, 2023   282   $-    4,050,235   $40   $278,653   $(262,748)  $15,945 

 

   Preferred Stock   Common Stock   Paid-In   Accumulated   Total 
   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
Balance as of December 31, 2023   256   $     -    5,320,671   $53   $279,433   $(270,714)  $8,772 
Stock based compensation   -    -    17    -    50    -    50 
Common stock issued for cash, net of fees   -    -    33,159,450    332    1,252    -    1,584 
Prefunded warrants issued for cash, net of fees   -    -    -    -    406    -    406 
Issuance of common stock from the exercise of warrants for cash   -    -    12,600,000    126    (126)   -    - 
Net loss   -    -    -    -    -    (886)   (886)
Balance as of March 31, 2024   256   $-    51,080,138   $511   $281,015   $(271,600)  $9,926 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

5

 

 

SINTX Technologies, Inc.

Condensed Consolidated Statements of Cash Flows - Unaudited

(in thousands)

 

   2024   2023 
  

Three Months Ended March 31,

 
   2024   2023 
Cash Flows From Operating Activities          
Net loss  $(886)  $(293)
Adjustments to reconcile net loss to net cash used in operating activities:          
Depreciation expense   256    154 
Amortization of right of use asset   163    183 
Amortization of intangible assets   1    1 
Stock based compensation   50    86 
Change in fair value of derivative liabilities   (2,838)   (3,898)
Bad debt expense   37    (3)
Changes in operating assets and liabilities:          
Trade accounts receivable   165    (137)
Prepaid expenses and other current assets   286    (457)
Inventories   45    110 
Accounts payable and accrued liabilities   128    (103)
Other liabilities   -    (337)
Payments on operating lease liability   (140)   (177)
Net cash used in operating activities   (2,733)   (4,871)
Cash Flows From Investing Activities          
Purchase of property and equipment   (174)   (236)
Proceeds from sale of property and equipment   1    - 
Net cash used in investing activities   (173)   (236)
Cash Flows From Financing Activities          
Proceeds from issuance of warrant derivative liabilities   3,366    6,650 
Proceeds from issuance of common stock and prefunded warrants, net of cash fees   2,003    4,840 
Proceeds from issuance of common stock in connection with exercise of warrants   1    - 
Payment on debt   (42)   - 
Redemption of Preferred Stock Series E   -    (2)
Net cash provided by financing activities   5,328    11,488 
Net increase in cash and cash equivalents   2,422    6,381 
Cash and cash equivalents at beginning of period   3,340    6,245 
Cash and cash equivalents at end of period  $5,762   $12,626 
           
Noncash Investing and Financing Activities          
Increase in Property, Plant, and Equipment from an Accrual  $319   $- 
Debt Issued for Prepaid Insurance   229    - 
Agent Warrant Offering Cost Allocated to Equity   13    - 
Right of use asset for amended lease liability – increase   4    - 
Right of use asset for lease liability   -    114 
Reduction of derivative liability upon exercise of warrants   -    5,502 
Par value of common stock upon cashless exercise of warrants   -    13 
Par value of common stock upon exercise of prefunded warrants   -    2 
           
Supplemental Cash Flow Information          
Cash paid for interest  $2   $2 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

6

 

 

SINTX TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

1. Organization and Summary of Significant Accounting Policies

 

The condensed consolidated financial statements include the accounts of SINTX Technologies, Inc. (“SINTX”) and its wholly-owned subsidiaries, SINTX Armor, Inc. (“SINTX Armor”) and Technology Assessment and Transfer, Inc. (TA&T), which are collectively referred to as “we” or “the Company”. SINTX is an advanced ceramics company formed in December 1996, focused on providing solutions in a variety of diverse fields, including biomedical, technical, and antipathogenic applications. SINTX is a company that has grown over time from focusing on the research and development of silicon nitride for use in human interbody implants to becoming an advanced ceramics company engaged in many different fields. The core strength of the Company is the manufacturing, research, and development of advanced ceramics for external partners. The Company presently manufactures ceramic powders and components in its Salt Lake City and Maryland facilities. The SINTX Salt Lake City facility is FDA and ANVISA registered, ISO 13485:2016 certified, and ASD9100D certified. The Company’s products are primarily sold in the United States.

 

The Company is focused on building revenue generating opportunities in three business industries - antipathogenic, technical (including armor), and biomedical – thereby connecting with current and new customers, partners and manufacturers to help realize the goal of leveraging expertise in high-tech ceramics to create new, innovative opportunities across these sectors. We expect our continued investment in research and development to provide additional revenue opportunities.

 

The Company’s initial focus was the development and commercialization of products made from silicon nitride for use in spinal fusion and hip and knee replacement applications. SINTX believes it is the first and only manufacturer to use silicon nitride in medical applications primarily focused on spine fusion therapies. Since then, we have developed other applications for our silicon nitride technology as well as utilized our expertise in the use of ceramic materials in other applications. In July 2021, the Company acquired the equipment and obtained certain proprietary know-how rights with which it intends to develop, manufacture, and commercialize protective armor from boron carbide and a composite material of silicon carbide and boron carbide for military, law enforcement and civilian uses. The protective armor operations are housed in SINTX Armor. In June 2022, the Company acquired TA&T, a nearly 40-year-old business with a mission to transition advanced materials and process technologies from a laboratory environment to commercial products and services

 

On October 1, 2018, the Company completed the sale of its retail spine business to CTL Medical, a Dallas, Texas-based privately held medical device manufacturer. As a result of the sale, CTL Medical became the exclusive owner of the Company’s portfolio of metal and silicon nitride spine products, as well as access to future silicon nitride spine technologies developed by the Company. The Company’s name, Amedica, was also transferred to CTL Medical, which is now CTL Amedica. The Company serves as CTL’s exclusive OEM provider of silicon nitride products. Manufacturing, R&D, and all intellectual property related to the core, non-spine, biomaterial technology including silicon nitride remains with the Company.

 

On October 30, 2018, the Company amended its Certificate of Incorporation with the State of Delaware to change its corporate name to SINTX Technologies, Inc. The Company also changed its trading symbol on the NASDAQ Capital Market to “SINT”.

 

The Company’s new corporate brand reflects both the Company’s core competence in the science and production of silicon nitride ceramics and other ceramics, as well as encouraging prospects for the future, as an OEM supplier of spine implants to CTL Amedica, and multiple opportunities outside of spine.

 

7

 

 

Basis of Presentation

 

These unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) and include all assets and liabilities of the Company.

 

SEC rules and regulations allow the omission of certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) so long as the statements are not misleading. In the opinion of management, these financial statements and accompanying notes contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented herein. These condensed consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 29, 2023. The results of operations for the three months ended March 31, 2024, are not necessarily indicative of the results to be expected for the year ending December 31, 2024. The Company’s significant accounting policies are set forth in Note 1 to the consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2023.

 

Use of Estimates

 

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates. As of March 31, 2024, the most significant estimate relates to derivative liabilities relating to common stock warrants.

 

Liquidity and Capital Resources

 

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and does not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

 

For the three months ended March 31, 2024, and 2023, the Company incurred a net loss of $0.9 million and $0.3 million, respectively, and used cash in operating activities of $2.7 million and $4.9 million, respectively. The Company had an accumulated deficit of $271.6 million and $270.7 million as of March 31, 2024, and December 31, 2023, respectively. To date, the Company’s operations have been principally financed from proceeds from the issuance of preferred and common stock and, to a lesser extent, cash generated from product sales. It is anticipated that the Company will continue to generate operating losses and use cash in operations. The Company’s continuation as a going concern is dependent upon its ability to increase sales, and/or raise additional funds through the capital markets. Whether and when the Company can attain profitability and positive cash flows from operations or obtain additional financing is uncertain.

 

The Company is actively generating additional scientific and clinical data to have it published in leading industry publications. The unique features of our advanced ceramic materials are not well known, and we believe the publication of such data would help sales efforts as the Company approaches new prospects. The Company is also making additional changes to the sales strategy, including a focus on revenue growth by expanding the use of silicon nitride in other areas outside of spinal fusion applications. The Company has also acquired equipment and certain proprietary know-how for the purpose of developing, manufacturing and commercializing armored plates made from boron carbide and a composite of boron carbide and silicon carbide for military, law enforcement and other civilian uses.

 

8

 

 

The Company has common stock that is publicly traded and has been able to successfully raise capital when needed since the date of the Company’s initial public offering in February 2014.

 

On February 25, 2021, the Company entered into an Equity Distribution Agreement (as amended, the “2021 Distribution Agreement”) with Maxim Group LLC (“Maxim”), pursuant to which the Company may sell from time to time, shares of the Company’s common stock having an aggregate offering price of up to $15 million through Maxim, as agent. On October 12, 2023, the Company entered into an amendment to the Distribution Agreement, pursuant to which the expiration date of the Distribution Agreement was extended to the earlier of: (i) the sale of shares having an aggregate offering price of $15.0 million, (ii) the termination by either Maxim or the Company upon the provision of fifteen (15) days written notice, or (iii) February 25, 2025. No other changes were made to the terms of the Distribution Agreement. The Company currently has registered up to $1.1 million for sale under the Distribution Agreement, pursuant to the Registration Statement on Form S-3 (File No. 333-274951). As of March 31, 2024, the Company had $0.07 million available for sale under the Distribution Agreement. As of March 31, 2024, there have been 2,471,949 shares of common stock sold under the 2021 Distribution Agreement for gross proceeds of $1.0 million. The Company is subject to General Instruction I.B.6 of Form S-3 which limits the amounts that we may sell under the registration statement over a 12-month period to an amount equal to or less than one-third of our public float. The shares of the Company’s common stock to be sold under the Distribution Agreement will be sold and issued pursuant to the Form S-3, as amended, which was previously declared effective by the Securities and Exchange Commission, and the related prospectus and one or more prospectus supplements.

 

On February 10, 2023, the Company closed on a public offering of 2,150,000 units, with each unit consisting of one share of common stock, or one pre-funded warrant to purchase one share of its common stock, one Class C Warrant to purchase one share of common stock, and one half of one Class D Warrant with each whole Class D Warrant entitling the holder to purchase one share of common stock. Gross proceeds, before deducting offering expenses, totaled approximately $12.0 million. Of the $12.0 million of gross proceeds, approximately $5.4 million were allocated to common stock and prefunded warrants ($4.8 million net of offering costs) and approximately $6.7 million were allocated to derivative liabilities (with approximately $0.7 million of cash offering costs and $0.1 million of agent warrant offering costs recorded as derivative expense).

 

On February 2, 2024, the Company closed on a public offering of 16,000,000 units, with each unit consisting of one share of its common stock, or one pre-funded warrant to purchase one share of its common stock, one Class E Warrant with each warrant to purchase one share of common stock, and one Class F Warrant with each warrant to purchase one share of common stock. Each unit was sold at a public offering price of $0.25 resulting in gross proceeds to the Company of $4 million before deducting offering fees and expenses. The Class E and Class F Warrants in the units will be immediately exercisable at a price of $0.25 per share. The Class E Warrants will expire five years from the date of issuance and the Class F Warrants will expire eighteen months from the date of issuance. Of the $4.0 million of gross proceeds, approximately $0.6 million were allocated to common stock and prefunded warrants ($0.5 million net of offering costs) and approximately $3.4 million were allocated to derivative liabilities (with approximately $0.5 million of cash offering costs and $0.1 million of agent warrant offering costs recorded as derivative expense).

 

On March 26, 2024, the Company closed on a public offering 28,400,000 shares of the Companys common stock, (the Offering). Each Share was sold at a public offering price of $0.047. The aggregate proceeds to the Company from the Offering were approximately $1.3 million before deducting placement agent fees and other estimated offering expenses payable by the Company.

 

If the Company seeks to obtain additional equity and/or debt financing, such funding is not assured and may not be available to the Company on favorable or acceptable terms and may involve significant restrictive covenants. Any additional equity financing is also not assured and, if available to the Company, will most likely be dilutive to its current stockholders. If the Company is not able to obtain additional debt or equity financing on a timely basis, the impact on the Company will be material and adverse. These uncertainties raise substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

 

9

 

 

Grant and Contract Revenue

 

Revenues from grants, contracts, and awards provided by governmental agencies are recorded based upon the terms of the specific agreements, which generally provide that revenue is earned when the allowable costs specified in the applicable agreement have been incurred or a milestone has been met. Cash received from federal grants, contracts, and awards can be subject to audit by the grantor and, if the examination results in a disallowance of any expenditure, repayment could be required.

 

New Accounting Pronouncements Not Yet Adopted

 

On December 14, 2023, the Financial Accounting Standards Board issued Accounting Standards Update, No. 2023-09 “Improvements to Income Tax Disclosures.” (“ASU 2023-09”). ASU 2023-09 enhances the detail that a business is required to disclose within its income tax footnote, including, but not limited to, a breakout of the rate reconciliation into more specific categories, such as state and local income tax, and foreign taxes. Additionally, a business must break out specific jurisdictions that encompass greater than or equal to 5% of their state and local, and foreign jurisdictions. The Company will adopt ASU 2023-09 on January 1, 2025. The adoption of this Standard is not expected to have a significant impact on the Company’s financial statements.

 

The Company has reviewed all other recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that no other pronouncements will have a significant effect on its financial statements.

 

2. Basic and Diluted Net Income (Loss) per Common Share

 

Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period that are determined to be dilutive. Common stock equivalents are primarily comprised of preferred stock and warrants for the purchase of common stock. The Company had potentially dilutive securities that were not included in the fully diluted loss per share calculation because they would have been antidilutive totaling approximately 18.1 million and 1.2 million as of March 31, 2024, and 2023, respectively.

 

10

 

 

Below are basic and diluted loss per share data for the three months ended March 31, 2024, which are in thousands except for share and per share data:

 

   Basic
Calculation
  

Effect of

Dilutive
Warrant
Securities

   Diluted
Calculation
 
Numerator:               
Net loss  $(886)  $(2,846)  $(3,732)
                
Denominator:               
Number of shares used in per common share calculations:   17,262,895    17,197,982    34,460,877 
                
Net loss per common share:               
Net loss  $(0.05)  $(0.17)  $(0.11)

 

Below are basic and diluted loss per share data for the three months ended March 31, 2023, which are in thousands except for share and per share data:

 

   Basic
Calculation
  

Effect of

Dilutive
Warrant
Securities

   Diluted
Calculation
 
Numerator:               
Net loss  $(293)  $(4,149)  $(4,442)
                
Denominator:               
Number of shares used in per common share calculations:   2,272,992    258,067    2,558,059 
                
Net loss per common share:               
Net loss  $(0.13)  $(1.61)  $(1.74)

 

3. Inventories

 

Inventories consisted of the following (in thousands):

 

   March 31, 2024   December 31, 2023 
Raw materials  $732   $691 
WIP   335    426 
Finished goods   109    104 
 Inventory net   $1,176   $1,221 

 

As of March 31, 2024, inventories totaling approximately $0.7 million and $0.5 million were classified as current and long-term, respectively. Inventories classified as current represent the carrying value of inventories as of March 31, 2024, that management estimates will be sold or used by March 31, 2025.

 

11

 

 

4. Fair Value Measurements

 

Financial Instruments Measured and Recorded at Fair Value on a Recurring Basis

 

The Company has issued certain warrants to purchase shares of common stock, which are considered derivative liabilities because they have registration rights which could require a cash settlement and are re-measured to fair value at each reporting period in accordance with accounting guidance. Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

 

  Level 1 - quoted market prices for identical assets or liabilities in active markets.
     
  Level 2 - observable prices that are based on inputs not quoted on active markets but corroborated by market data.
     
  Level 3 - unobservable inputs reflecting management’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

 

The Company classifies assets and liabilities measured at fair value in their entirety based on the lowest level of input that is significant to their fair value measurement. No financial assets were measured on a recurring basis as of March 31, 2024, and December 31, 2023. The following tables set forth the financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy as of March 31, 2024, and December 31, 2023 (in thousands):

   Fair Value Measurements as of March 31, 2024 
Description  Level 1   Level 2   Level 3   Total 
Derivative liability                    
Common stock warrants  $   -   $   -   $845   $845 

 

   Fair Value Measurements as of December 31, 2023 
Description  Level 1   Level 2   Level 3   Total 
Derivative liability                    
Common stock warrants  $   -   $   -   $304   $304 

 

12

 

 

The Company did not have any transfers of assets and liabilities between Level 1 and Level 2 of the fair value measurement hierarchy during the three months ended March 31, 2024, and 2023. The following table presents a reconciliation of the derivative liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended March 31, 2024, and 2023 (in thousands):

 

   Common Stock
Warrants
 
Balance as of December 31, 2022  $(5,126)
Issuance of derivatives   (6,650)
Exercise of warrants   5,502 
Change in fair value   4,006 
Other   1 
Balance as of March 31, 2023  $(2,267)
      
Balance as of December 31, 2023  $(304)
Issuance of derivatives   (3,366)
Change in fair value   2,838 
Other   (13)
Balance as of March 31, 2024  $(845)

 

Common Stock Warrants

 

The Company has issued certain warrants to purchase shares of common stock, which are considered derivative liabilities because they have registration rights which could require a cash settlement and are re-measured to fair value at each reporting period in accordance with accounting guidance. As of March 31, 2024, and December 31, 2023, the derivative liability was calculated using the Monte Carlo Simulation valuation.

 

The assumptions used in estimating the common stock warrant liability using the Monte Carlo simulation valuation model as of March 31, 2024, and December 31, 2023 were as follows:

 

    March 31, 2024     December 31, 2023  
Weighted-average risk-free interest rate   4.18%-5.07 %   3.93-4.79 %
Weighted-average expected life (in years)   0.85-4.84     1.10-4.12   
Expected dividend yield   -%   -%
Weighted-average expected volatility   115.0%-145.0 %   113.1%-125.7 %

 

Other Financial Instruments

 

The Company’s recorded values of cash and cash equivalents, account and other receivables, accounts payable and accrued liabilities approximate their fair values based on their short-term nature. The recorded value of notes payable approximates the fair value as the interest rate approximates market interest rates.

 

5. Accrued Liabilities

 

Accrued liabilities consisted of the following (in thousands):

 

   March 31, 2024   December 31, 2023 
Payroll and related expense  $851   $610 
Accrued payables   568    163 
Other   622    631 
 Accrued liabilities    $2,041   $1,404 

 

13

 

 

6. Debt

 

Business Loan

 

On July 20, 2021, TA&T entered into a Loan Authorization and Agreement in the amount of approximately $350,000 (the “Business Loan”). The Company made a one-time $35,000 buy down payment when acquiring the loan. The Business Loan bears interest at a rate of 3.75% per annum. The Business Loan is secured by a general security interest in all of the assets of TA&T. The business loan was paid in full during the first quarter of 2023 and there was no outstanding balance at March 31, 2024.

 

Related Party Debt

 

TA&T is obligated to repay certain personal loans made by the founders of TA&T to TA&T prior to SINTX’s acquisition of TA&T (the Personal Loans”). The total amount of the Personal Loans at June 30, 2022 was approximately $350,000. The Company agreed to repay the outstanding balance of the Personal Loans in (i) 24 equal monthly installments beginning September 1, 2022 and each month thereafter until paid in full as one prior owner’s portion of the Personal Loans totaling $157,000, and (ii) for the other owner’s portion of the Personal Loans totaling $193,000. As of March 31, 2024, the related party debt had an outstanding balance of $26,000. The outstanding balance is being paid in monthly installments ending August 1, 2024. The related party debt is not collateralized and has no interest rate.

 

7. Equity

 

2024 February Registered Offering

 

On February 2, 2024, the “Company closed on the public offering of 16,000,000 units consisting of (a)(i) 3,400,000 units (the “Common Units”) to purchase shares (the “Unit Shares”) of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”) and (ii) 12,600,000 units (the “Pre-Funded Warrant Units” and together with the Common Units, the “Units”) to purchase pre-funded warrants (the “Pre-Funded Warrants and each share of Common Stock underlying a Pre-Funded Warrant, a “Pre-Funded Warrant Share”) to purchase up to 12,600,000 shares of Common Stock, (b) accompanying Class E warrants to purchase 16,000,000 shares of the Company’s Common Stock (the “Class E Warrants”), and (c) accompanying Class F warrants to purchase 16,000,000 shares of the Company’s Common Stock (the “Class F Warrants”). The aggregate proceeds to the Company from the Offering were approximately $4 million before deducting placement agent fees and other offering expenses payable by the Company. The offering was made pursuant to a securities purchase agreement (the “Purchase Agreement”) with certain investors (the “Purchasers”), and a placement agency agreement dated as of January 31, 2024 (the “PAA”) with Maxim Group LLC (the “Placement Agent”). Each Common Unit was sold at a public offering price of $0.25 and each Pre-Funded Warrant Unit was sold at a public offering price of $0.2499. The Class E Warrants and the Class F Warrants are immediately exercisable (subject to the beneficial ownership cap at 4.99% or 9.99%) for one share of the Company’s Common Stock at an exercise price of $0.25 per share. The Class E Warrants will expire five years from the date of issuance and the Class F Warrants will expire 18 months from the date of issuance. Each Pre-Funded Warrant is exercisable for one share of the Company’s Common Stock at an exercise price of $0.0001 per share. The Pre-Funded Warrants are immediately exercisable (subject to the beneficial ownership cap at 4.99% or 9.99%) and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full. The Company engaged Maxim Group LLC as the Company’s sole placement agent for the Offering pursuant to the PAA. Pursuant to the PAA, the Company agreed to pay the Placement Agent a cash placement fee equal to 7.0% of the gross proceeds of the Offering, plus reimbursement of certain expenses and legal fees up to $100,000. The Company also agreed to issue up to 640,000 Common Stock purchase warrants to the Placement Agent (the “Placement Agent Warrants”). The Placement Agent Warrants are exercisable at an exercise price of $0.275. The Placement Agent Warrants will be exercisable beginning July 31, 2024 and will expire five years after the commencement of sales in the offering.

 

2024 March Registered Offering

 

On March 26, 2024, the Company closed on a public offering 28,400,000 shares of the Company’s common stock, (the “Offering”). Each Share was sold at a public offering price of $0.047. The aggregate proceeds to the Company from the Offering were approximately $1.3 million before deducting placement agent fees and other estimated offering expenses payable by the Company.

 

2023 Registered Offering

 

On February 10, 2023, the Company closed on a public offering of 2,150,000 units, with each unit consisting of one share of common stock, or one pre-funded warrant to purchase one share of its common stock, one Class C Warrant to purchase one share of common stock, and one half of one Class D Warrant with each whole Class D Warrant entitling the holder to purchase one share of common stock. Each unit was sold at a public offering price of $5.60. The Class C and Class D Warrants are immediately exercisable at a price of $5.60 per share. The Class C and Class D warrants each have a cashless exercise provision entitling the holders to surrender one Class C Warrant and receive 0.4 shares of common stock and on the surrender of one Class D Warrant the holder is entitled to receive 0.8 shares of common stock. The Class C Warrants expire five years from the date of issuance and the Class D Warrants expire three years from the date of issuance. The shares of common stock (or pre-funded warrants in lieu thereof) and accompanying warrants were only purchasable together in this offering but were issued separately and were immediately separable upon issuance. In addition, the company issued a total of 86,000 common stock warrants to the placement agent, Maxim Group, and the Company’s financial advisor, Ascendiant Capital. Gross proceeds, before deducting offering expenses, totaled approximately $12.0 million. Of the $12.0 million of gross proceeds, approximately $5.4 million were allocated to common stock and prefunded warrants ($4.8 million net of offering costs) and approximately $6.7 million were allocated to derivative liabilities (with approximately $0.7 million of cash offering costs and $0.1 million of agent warrant offering costs recorded as derivative expense).

 

2021 Equity Distribution Agreement

 

On February 25, 2021, the Company entered into an Equity Distribution Agreement (as amended, the “Distribution Agreement”) with Maxim Group LLC (“Maxim”), pursuant to which the Company may sell from time to time, shares of the Company’s common stock having an aggregate offering price of up to $15 million through Maxim, as agent. Subject to the terms and conditions of the Distribution Agreement, as amended, Maxim will use its commercially reasonable efforts to sell the shares from time to time, based on our instructions. Under the Distribution Agreement, Maxim may sell the Shares by any method permitted by law deemed to be an “at-the-market” offering (the “ATM”) as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), including, without limitation, sales made directly on the Nasdaq Capital Market. We have no obligation to sell any shares under the ATM and may at any time suspend offers under the 2021 Distribution Agreement. On October 12, 2023, the Company entered into an amendment to the Distribution Agreement, pursuant to which the expiration date of the Distribution Agreement was extended to the earlier of: (i) the sale of shares having an aggregate offering price of $15.0 million, (ii) the termination by either Maxim or the Company upon the provision of fifteen (15) days written notice, or (iii) February 25, 2025. No other changes were made to the terms of the Distribution Agreement. Under the terms of the Distribution Agreement, Maxim will be entitled to a transaction fee at a fixed rate of 2.0% of the gross sales price of Shares sold under the 2021 Distribution Agreement. The Company will also reimburse Maxim for certain expenses incurred in connection with the Distribution Agreement and agreed to provide indemnification and contribution to Maxim with respect to certain liabilities under the Securities Act and the Securities Exchange Act of 1934, as amended. As of March 31, 2024, there have been 2,471,949 shares of common stock sold under the 2021 Distribution Agreement for gross proceeds of $1,030,519. As a result, there is only approximately $70,000 more that could be raised under the 2021 Distribution Agreement. Because the company’s public float is less than $75 million, we may not sell securities over a 12-month period in an amount greater than one-third of our public float. In connection with the February 2024 offering, the Company agreed to not make any sales of securities under the ATM for a period of six months from the date of closing the offering, February 2, 2024, until August 2, 2024. The shares of the Company’s common stock to be sold under the Distribution Agreement will be sold and issued pursuant to the Form S-3, as amended, which was previously declared effective by the Securities and Exchange Commission, and the related prospectus and one or more prospectus supplements.

 

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8. Stock-Based Compensation

 

A summary of the Company’s outstanding stock option activity for the three months ended March 31, 2024, and 2023 is as follows:

 

       March 31, 2024     
      

Weighted-

Average

  

Weighted-

Average

Remaining

Contractual

   Intrinsic 
   Options   Exercise Price  

Life

(Years)

   Value 
As of December 31, 2023   11,909   $109.77    6.9   $     - 
Granted   -    -    -    - 
Exercised   -    -    -    - 
Forfeited   -    -    -    - 
Expired   -    -    -    - 
As of March 31, 2024   11,909   $82.75    6.7   $- 
Exercisable at March 31, 2024   10,838   $140.68    6.8   $- 
Vested and expected to vest at March 31, 2024   9,571   $82.43    6.6   $- 

 

       March 31, 2023     
      

Weighted-

Average

  

Weighted-

Average

Remaining

Contractual

   Intrinsic 
   Options   Exercise Price  

Life

(Years)

   Value 
As of December 31, 2022   11,909   $234.02    6.9   $     - 
Granted   -    -    -    - 
Exercised   -    -    -    - 
Forfeited   -    -    -    - 
Expired   -    -    -    - 
As of March 31, 2023   11,909   $120.33    7.7   $- 
Exercisable at March 31, 2023   8,303   $330.56    7.6   $- 
Vested and expected to vest at March 31, 2023   9,840   $119.65    7.7   $- 

 

The Company estimates the fair value of each stock option on the grant date using the Black-Scholes-Merton valuation model, which requires several estimates including an estimate of the fair value of the underlying common stock on grant date. The expected volatility was based on an average of the historical volatility of the Company. The expected term was contractual life of option. The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option. The Company did not grant any stock options during the first quarter of 2023.

 

Of the 11,909 options outstanding as of March 31, 2024, 3,550 were awarded to non-executive members of the board of directors.

 

Unrecognized stock-based compensation as of March 31, 2024, is as follows (in thousands):

 

      

Weighted

Average

 
  

Unrecognized

Stock-Based

  

Remaining of

Recognition

 
   Compensation   (in years) 
Stock options  $      38     0.5 
Stock grants  $28    1.8 

 

9. Commitments and Contingencies

 

The Company has executed agreements with certain executive officers of the Company which, upon the occurrence of certain events related to a change in control, call for payments to the executives up to three times their annual salary and accelerated vesting of previously granted stock options.

 

From time to time, the Company is subject to various claims and legal proceedings covering matters that arise in the ordinary course of its business activities. Management believes any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on the Company’s consolidated financial position, operating results or cash flows.

 

15

 

 

10. Leases

 

The Company has entered into multiple operating leases from which it conducts its business.

 

SINTX

 

With respect to SINTX operations, the Company leases 30,764 square feet of office, warehouse and manufacturing space under a single operating lease. This lease expires in October 2031. The lease has one five-year extension option.

 

SINTX Armor

 

On August 19, 2021, the Company, on behalf of SINTX Armor, entered into an Industrial Lease Agreement (the “SINTX Armor Lease”) pursuant to which the Company has agreed to lease approximately 10,936 square feet of office and manufacturing space from which SINTX Armor will conduct its operations. The term of the SINTX Armor Lease is 122 months through October 2031.

 

TA&T

 

In connection with operation of its business, TA&T has entered into various leases for approximately 15,840 square feet of office and manufacturing space from which it conducts its research, development and manufacturing activities. The leases have various expiration dates ranging from April 30, 2024 through April 2030. Subsequent to December 31, 2023 we entered into an amended lease agreement reducing this area to 13,560 square feet. The leases have various expiration dates ranging from July 2024 through April 2025.

 

Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. The Company accounts for lease components separately from the non-lease components. The depreciable life of the assets and leasehold improvements are limited by the expected lease term.

 

As of March 31, 2024, the operating lease right-of-use assets totaled approximately $3.9 million, and the operating lease liability totaled approximately $4.1 million. Non-cash operating lease expense during the three months ended March 31, 2024 and 2023, totaled approximately $0.2 and $0.2 million, respectively. As of March 31, 2024, the weighted-average discount rate for the Company’s operating lease was 8.7%.

 

Operating lease future minimum payments together with the present values as of March 31, 2024, are summarized as follows:

 

Years Ending December 31,  March 31, 2024 
2024  $643 
2025   738 
2026   668 
2027   688 
2028   709 
Thereafter   2,124 
Total future minimum lease payments   5,570 
Less amounts representing interests   (1,505)
Present value of lease liability   4065 
      
Current-portion of operating lease liability   518 
Long-term portion operating lease liability  $3,547 

 

11. Subsequent Events

 

NASDAQ Notice of Delisting

 

As previously disclosed on October 20, 2023, the Company received a notification letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, because the closing bid price for the Company’s common stock was below $1.00 per share for 30 consecutive trading days, the Company is not currently in compliance with the minimum bid price requirement for continued listing on The Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”). In accordance with Listing Rule 5810(c)(3)(A), the Company was provided 180 calendar days, until April 17, 2024, to regain compliance with the Minimum Bid Price Requirement.

 

On April 8, 2024, the Company received a new notification letter from the Staff notifying the Company that, as of April 5, 2024, the Company’s common stock had a closing bid price of $0.10 or less for ten consecutive trading days and that, consistent with Nasdaq Listing Rule 5810(c)(3)(A)(iii), the Staff has determined to delist the Company’s common stock from The Nasdaq Capital Market. The notice further provides that the Company has until April 15, 2024, to request a hearing before an independent Hearings Panel (the “Panel”). The Company has since been notified by the Nasdaq Hearing Panel that based on its review of the written record, the Nasdaq Hearings Panel (“Panel”) determined to grant the Company a temporary exception to regain compliance with The Nasdaq Stock Market LLC’s (“Nasdaq” or the “Exchange”) Listing Rule 5550(a)(2) (the “Bid Price Rule”) until June 10, 2024. In the event the Company fails to regain compliance with the Bid Price Rule by that date, its securities will be delisted. There can be no assurance that the Company will ultimately regain compliance with all applicable requirements for continued listing on The Nasdaq Capital Market.

 

2024 April Registered Offering

 

On April 5, 2024, the Company closed on a public offering 71,600,000 shares of the Company’s common stock, (the “Offering”). Each Share was sold at a public offering price of $0.021. The aggregate proceeds to the Company from the Offering were approximately $1.5 million before deducting placement agent fees and other estimated offering expenses payable by the Company.

 

Retirement of CEO and President

 

On April 25, 2024, B. Sonny Bal, MD, informed the board of directors of his intention to retire from his position as President and Chief Executive Officer of SINTX Technologies, Inc. (the “Company”), effective on the Company naming a replacement President and Chief Executive Officer. Dr. Bal will continue to serve on the Company’s board of directors in the position of Chairman. In connection with Dr. Bal’s retirement, Dr. Bal and the Company entered into a Separation and Release of Claims Agreement (the “Agreement”). The Agreement provides that in exchange for Dr. Bal’s covenants and releases under the terms of the Agreement, Dr. Bal will receive upon his retirement a lump sum payment equal to three months of salary and the Company will pay Dr. Bal’s COBRA premium for a period of three months should he elect COBRA benefits.

 

16

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements for the year ended December 31, 2023 and the notes thereto, along with Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed separately with the U.S. Securities and Exchange Commission. This discussion and analysis contains forward-looking statements based upon current beliefs, plans, expectations, intentions and projections that involve risks, uncertainties and assumptions, such as statements regarding our plans, objectives, expectations, intentions and projections. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2023, and any updates to those risk factors filed from time to time in our Quarterly Reports on Form 10-Q and in other filings with the Securities and Exchange Commission we may make from time-to-time.

 

Overview

 

SINTX Technologies is an advanced ceramics company formed in December 1996, focused on providing solutions in a variety of biomedical, technical, and antipathogenic applications. We have grown from focusing primarily on the research, development and commercialization of medical devices manufactured with silicon nitride to becoming an advanced ceramics company engaged in diverse fields, including biomedical, technical and antipathogenic applications. This diversification enables us to focus on our core competencies which are the manufacturing, research, and development of products comprised from advanced ceramic materials for external partners. We seek to connect with new customers, partners and manufacturers to help them realize the goal of leveraging our expertise in advanced ceramics to create new, innovative products across these sectors.

 

SINTX Core Business

 

Biomedical Applications: Since its inception, SINTX has been focused on medical grade silicon nitride. SINTX biomedical products have been shown to be biocompatible, bioactive, antipathogenic, and to have superb bone affinity. Spinal implants made from SINTX silicon nitride have been successfully implanted in humans since 2008 in the US, Europe, Brazil, and Taiwan. This established use, along with its inherent resistance to bacterial adhesion and bone affinity suggests that it may also be suitable in other fusion device applications such as arthroplasty implants, foot wedges, and dental implants. Bacterial infection of any biomaterial implants is always a concern. SINTX silicon nitride has been shown to be resistant to bacterial colonization and biofilm formation, making it antibacterial. SINTX silicon nitride products can be polished to a smooth and wear-resistant surface for articulating applications, such as bearings for hip and knee replacements.

 

We believe that silicon nitride has a superb combination of properties that make it suited for long-term human implantation. Other biomaterials are based on bone grafts, metal alloys, and polymers- all of which have well-known practical limitations and disadvantages. In contrast, silicon nitride has a legacy of success in the most demanding and extreme industrial environments. As a human implant material, silicon nitride offers bone ingrowth, resistance to bacterial and viral infection, ease of diagnostic imaging, resistance to corrosion, and superior strength and fracture resistance, all of which claims are validated in our large and growing inventory of peer-reviewed, published literature reports. We believe that our versatile silicon nitride manufacturing expertise positions us favorably to introduce new and innovative devices in the medical and non-medical fields.

 

In June 2022, we acquired Technology Assessment and Transfer, Inc. (TA&T), a nearly 40-year-old business with a mission to transition advanced materials and process technologies from a laboratory environment to commercial products and services. TA&T has supplied ceramics for use in several biomedical applications. These products were made via 3D printing and include components for surgical instruments as well as conceptual and prototype dental implants.

 

17

 

 

Technical Applications: It is our belief that our silicon nitride has the best combination of mechanical, thermal, and electrical properties of any technical ceramic material. It is a high-performance technical ceramic with high strength, toughness, and hardness, and is extremely resistant to thermal shock and impact. It is also an electrically insulating ceramic material. Typically, it is used in applications where high load-bearing capacity, thermal stability, and wear resistance are required. We have obtained AS9100D certification and ITAR registration to facilitate entry into the aerospace and protective armor markets.

 

We entered the ceramic armor market through the purchase of assets from B4C, LLC and a technology partnership with Precision Ceramics USA. We will develop and manufacture high-performance ceramics for personnel, aircraft, and vehicle armor including a 100% Boron Carbide material for ultimate lightweight performance in ballistic applications, and a composite material made of Boron Carbide and Silicon Carbide for exceptional multi-hit performance against ballistic threats. We have signed a 10-year lease at a building near our headquarters in Salt Lake City, Utah to house development and manufacturing activities for SINTX Armor.

 

TA&T’s primary area of expertise is material processing and fabrication know-how for a broad spectrum of monolithic ceramic, ceramic composite, and coating materials. Primary technologies include Additive Manufacturing (3D Printing) of ceramics and metals, low-cost fabrication of fiber reinforced ceramic matrix composites (CMCs) and refractory chemical vapor deposited (CVD) coatings, transparent ceramics for ballistic armor and optical applications, and magnetron sputtered (PVD) coatings for lubrication, wear resistance and environmental barrier coatings for CMCs. TA&T also provides a host of services that include 3D printing, PVD-CVD coatings, material processing-CMCs, CIP, PS, HP, HIP, and material characterization for powders and finished parts-TGA/DSC, PSD. SA, Dilatometry, UV-VIS and FTIR transmission, haze and clarity.

 

Antipathogenic Applications: Today, there is a global need to improve protection against pathogens in everyday life. SINTX believes that by incorporating its unique composition of silicon nitride antipathogenic powder into products such as face masks, filters, and wound care devices, it is possible to manufacture surfaces that inactivate pathogens, thereby limiting the spread of infection and disease. The discovery in 2020 that SINTX silicon nitride inactivates SARS-CoV-2, the virus which causes the disease COVID-19, has opened new markets and applications for our material.

 

We presently manufacture advanced ceramic powders and components in our manufacturing facilities based in Salt Lake City, Utah and Millersville, Maryland.

 

18

 

 

Components of our Results of Operations

 

We manage our business within one reportable segment, which is consistent with how our management reviews our business, makes investment and resource allocation decisions and assesses operating performance.

 

Revenue

 

Our product revenue is derived from the manufacture and sale of products. These revenue sources include coatings, materials, and components for aerospace and medical device markets, toll processing services, and government contracts and grants. We generally recognize revenue from sales where control transfers at a point in time as the title and risk of loss passes to the customer, which is at the time the product is shipped. In general, our customer does not have rights of return or exchange.

 

We believe our product revenue will increase as we secure opportunities to manufacture third party products with silicon nitride, launch and generate revenue from our ceramic armor products, and as we continue to introduce new products into the market.

 

We derive grant and contract revenue from awards provided by governmental agencies.

 

Cost of Revenue

 

The expenses that are included in cost of revenue include all in-house manufacturing costs for the products we manufacture.

 

Gross Profit

 

Our gross profit measures our product revenue relative to our cost of revenue.

 

Research and Development Expenses

 

Our research and development costs are expensed as incurred. Research and development costs consist of engineering, product development, clinical trials, test-part manufacturing, testing, developing and validating the manufacturing process, manufacturing, facility and regulatory-related costs. Research and development expenses also include employee compensation, employee and non-employee stock-based compensation, supplies and materials, consultant services, and travel and facilities expenses related to research and development activities.

 

We expect to incur additional research and development costs as we continue to develop new medical devices, industrial and ceramic armor products, product candidates for antipathogenic applications, and other products which may increase our total research and development expenses.

 

General and Administrative Expenses

 

General and administrative expenses consist primarily of salaries, benefits and other related costs, including stock-based compensation for certain members of our executive team and other personnel employed in finance, compliance, administrative, information technology, customer service, executive and human resource departments. General and administrative expenses also include other expenses not part of the other cost categories mentioned above, including facility expenses and professional fees for accounting and legal services.

 

19

 

 

RESULTS OF OPERATIONS

 

The following is a tabular presentation of our unaudited condensed consolidated operating results for the three months ended March 31, 2024 and 2023 (in thousands):

 

  

Three Months Ended

March 31,

         
   2024   2023   $ Change   % Change 
Product revenue  $309   $240   $69    29%
Grant and contract revenue   378    299    79    26%
Total revenue   687    539    148    27%
Costs of revenue   223    118    105    89%
Gross profit   464    421    43    10%
Operating expenses:                    
Research and development   2,019    2,200    (181)   -8%
General and administrative   1,123    1,169    (46)   -4%
Sales and marketing   246    310    (64)   -21%
Grant expenses   273    299    (26)   -9%
Total operating expenses   3,661    3,978    (317)   -8%
Loss from operations   (3,197)   (3,557)   360    -10%
Other income, net   2,311    3,264    (953)   -29%
Net income (loss) before income taxes   (886)   (293)   (593)   202%
Provision for income taxes   -    -    -     
Net income (loss)   (886)   (293)   (593)   202%

 

Revenue

 

For the three months ended March 31, 2024, total product revenue increase $0.1 million, or 29% as compared to the same period in 2023. During the quarter ended March 31, 2024 grant and contract revenue increase $0.1 million, or 26% as compared to the same period in 2023. The increases were primarily due to new orders for silicon nitride aerospace components and government grants and contracts in our Salt Lake City operation as well as commercial and government contract revenue in our Maryland operation.

 

Cost of Revenue and Gross Profit

 

For the three months ended March 31, 2024, cost of revenue increased $0.1 million, or 89% as compared to the same period in 2023. This increase was primarily attributable to the increase in revenue mentioned above.

 

Research and Development Expenses

 

For the three months ended March 31, 2024, research and development expenses decreased $0.2 million, or -8%, as compared to the same period in 2023. This decrease was primarily attributable to a decrease in patent expenses and outside consulting costs.

 

General and Administrative Expenses

 

For the three months ended March 31, 2024, general and administrative expenses decreased $0.05 million, or -4%, as compared to the same period in 2023. This decrease is primarily due to a decrease in costs for employee recruiting.

 

20

 

 

Sales and Marketing Expenses

 

For the three months ended March 31, 2024, sales and marketing expenses decreased $0.1 million, or -21%, as compared to the same period in 2023. This decrease was primarily attributable to an overall decrease in payroll related costs and costs for outside consulting.

 

Grant Expenses

 

For the three months ended March 31, 2024, grant and contract expenses remained primarily unchanged at $0.3 million.

 

Other Income, Net

 

For the three months ended March 31, 2024, other income decreased $1.0 million, or -29%, as compared to the same period in 2023. This decrease was primarily due to a $1.7 million decrease in non-cash derivative expense offset by $0.8 million in offering costs associated with derivative liabilities in the prior year.

 

Liquidity and Capital Resources

 

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and does not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

 

For the three months ended March 31, 2024, and 2023, the Company incurred net loss of $0.9 million and $0.3 million, respectively, and used cash in operating activities of $2.7 million and $4.9 million, respectively. The Company had an accumulated deficit of $271.6 million and $270.7 million as of March 31, 2024, and December 31, 2023, respectively.

 

The Company’s operations have been principally financed from proceeds from the issuance of preferred and common stock and, to a lesser extent, cash generated from product sales. It is anticipated that the Company will continue to generate operating losses and use cash in operations. The Company’s continuation as a going concern is dependent upon its ability to increase sales, and/or raise additional funds through the capital markets. Whether and when the Company can attain profitability and positive cash flows from operations or obtain additional financing is uncertain.

 

The Company is actively generating additional scientific and clinical data to have it published in leading industry publications. We believe the publication of such data would help sales efforts as the Company approaches new prospects. The Company is also making additional changes to the sales strategy, including a focus on revenue growth by expanding the use of silicon nitride in other areas outside of spinal fusion applications. For instance, results from an independent study demonstrated the potential anti-viral properties of our silicon nitride. We believe that we may be able to apply our silicon nitride powder to personal protection products, such as face masks, gowns and gloves, resulting in inactivation of viruses that come into contact with the items.

 

The Company has common stock that is publicly traded and has been able to successfully raise capital when needed since the date of the Company’s initial public offering in February 2014.

 

On March 26, 2024, the Company closed on a public offering 28,400,000 shares of the Company’s common stock, (the “Offering”). Each Share was sold at a public offering price of $0.047. The aggregate proceeds to the Company from the Offering were approximately $1.3 million before deducting placement agent fees and other estimated offering expenses payable by the Company.

 

On February 2, 2024, the Company closed on a public offering of 16,000,000 units, with each unit consisting of one share of its common stock, or one pre-funded warrant to purchase one share of its common stock, one Class E Warrant with each warrant to purchase one share of common stock, and one Class F Warrant with each warrant to purchase one share of common stock. Each unit was sold at a public offering price of $0.25. The Class E and Class F Warrants in the units are immediately exercisable at a price of $0.25 per share. The Class E Warrants will expire five years from the date of issuance and the Class F Warrants will expire eighteen months from the date of issuance. Gross proceeds, before deducting placement agent fees and other offering expenses, are approximately $4.0 million.

 

On February 10, 2023, the Company closed on a public offering of 2,150,000 units, with each unit consisting of one share of common stock, or one pre-funded warrant to purchase one share of its common stock, one Class C Warrant to purchase one share of common stock, and one half of one Class D Warrant with each whole Class D Warrant entitling the holder to purchase one share of common stock. Gross proceeds, before deducting offering expenses, totaled approximately $12.0 million. Of the $12.0 million of gross proceeds, approximately $5.4 million were allocated to common stock and prefunded warrants ($4.8 million net of offering costs) and approximately $6.7 million were allocated to derivative liabilities (with approximately $0.7 million of cash offering costs and $0.1 million of agent warrant offering costs recorded as derivative expense).

 

On October 17, 2022, the Company completed a rights offering of units consisting of convertible preferred stock and common stock warrants, resulting in gross proceeds to the Company of approximately $4.7 million, after deducting expenses relating to the offering, including dealer-manager fees and expenses,

 

21

 

 

On February 25, 2021, the Company entered into an Equity Distribution Agreement with Maxim Group LLC (“Maxim”), which was subsequently amended on October 12, 2023 (as amended, the “2021 Distribution Agreement”), pursuant to which the Company may sell from time to time, shares of the Company’s common stock having an aggregate offering price of up to $1.1 million through Maxim, as agent. As of March 1, 2024, there have been 2,471,949 shares of common stock sold under the 2021 Distribution Agreement for gross proceeds of $1.0 million. In connection with the February 2024 offering, the Company agreed to not make any sales of securities under the ATM for a period of six months from the date of closing the offering, February 2, 2024, until August 2, 2024.

 

These uncertainties raise substantial doubt about our ability to continue as a going concern. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

 

Cash Flows

 

The following table summarizes, for the periods indicated, cash flows from operating, investing and financing activities (in thousands) – unaudited:

 

   Three Months Ended March 31, 
   2024   2023 
Net cash used in operating activities  $(2,733)  $(4,871)
Net cash used in investing activities   (173)   (236)
Net cash provided by financing activities   5,328    11,488 
Net increase (decrease) in cash  $2,422   $6,381 

 

22

 

 

Net Cash Used in Operating Activities

 

Net cash used in operating activities was $2.7 million during the three months ended March 31, 2024, compared to $4.9 million used during the three months ended March 31, 2023, a decrease of $2.2 million. The decrease in the net loss from operations, and related non-cash add backs to the net loss, was $0.6 million from 2024 when compared to 2023. The decrease in cash used for operating activities during 2024 was primarily due to the $0.6 million mentioned above plus changes in the movement of working capital items during 2024 as compared to the same period in 2023 as follows: a $0.7 million decrease in cash used in prepaid expenses, a $0.3 million decrease in cash used in other liabilities, a $0.3 million decrease in accounts receivable, a $0.2 million increase in cash used in accounts payable, a $0.1 million decrease in cash used for payments on operating lease liability.

 

Net Cash Used in Investing Activities

 

Net cash used in investing activities was $0.2 million during the three months ended March 31, 2024 and 2023, remaining primarily unchanged.

 

Net Cash Provided by Financing Activities

 

There was $5.3 million in cash provided by financing activities during the three months ended March 31, 2024, compared to $11.5 million in cash provided by financing activities during the same period in 2023. The $6.2 million decrease to net cash provided by financing activities was primarily attributable to a decrease in proceeds from issuance of warrant derivative liabilities of $3.3 million and a decrease in proceeds from issuance of common stock of $2.8 million, offset by a $0.1 million increase in payments on debt.

 

Indebtedness

 

Business Loan

 

On July 20, 2021, TA&T, entered into a Loan Authorization and Agreement in the amount of approximately $350,000 (the “Business Loan”). The Company made a one-time $35,000 buy down payment when acquiring the loan. The Business Loan bore interest at a rate of 3.75% per annum. The Business Loan was secured by a general security interest in all of the assets of TA&T. The Business Loan contained other standard provisions that are customary of loans of this type. The business loan was paid in full during the first quarter of 2023 and there was no outstanding balance at March 31, 2024.

 

Related Party Debt

 

TA&T is obligated to repay certain personal loans made by the founders of TA&T to TA&T prior to SINTX’s acquisition of TA&T (the “Personal Loans”). The total amount of the Personal Loans at September 30, 2022 was approximately $350,000. The Company agreed to repay the outstanding balance of the Personal Loans in (i) 24 equal monthly installments beginning September 1, 2022 and each month thereafter until paid in full as one prior owner’s portion of the Personal Loans totaling $157,000, and (ii) for the other owner’s portion of the Personal Loans totaling $193,000. As of March 31, 2024, the related party debt had an outstanding balance of $26,000. The outstanding balance is being paid in monthly installments ending August 1, 2024. The related party debt is not collateralized and has no interest rate.

 

Wells Fargo Line of Credit

 

Prior to SINTX’s acquisition of TA&T, TA&T entered into a revolving line of credit with Wells Fargo. As of March 31, 2024, the line of credit with Wells Fargo had no outstanding balance and the account has been closed.

 

23

 

 

Off-Balance Sheet Arrangements

 

We do not have any off-balance sheet arrangements, as defined in Item 303(a)(4) of Regulation S-K.

 

Critical Accounting Policies and Estimates

 

A summary of our significant accounting policies and estimates is discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 1 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. There have been no material changes to those policies for the three months ended March 31, 2024. The preparation of the consolidated financial statements in accordance with U.S. generally accepted accounting principles requires us to make judgments, estimates and assumptions regarding uncertainties that affect the reported amounts of assets and liabilities. Significant areas of uncertainty that require judgments, estimates and assumptions include the accounting for income taxes and other contingencies as well as valuation of derivative liabilities, asset impairment and collectability of accounts receivable. We use historical and other information that we consider to be relevant to make these judgments and estimates. However, actual results may differ from those estimates and assumptions that are used to prepare our condensed consolidated financial statements.

 

New Accounting Pronouncements Not Yet Adopted

 

See discussion under Note 1, Organization and Summary of Significant Accounting Policies, to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q, for information on new accounting pronouncements.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not applicable.

 

ITEM 4. CONTROLS AND PROCEDURES

 

This Report includes the certifications of our Chief Executive Officer and Principal Financial Officer required by Rule 13a-14 of the Securities Exchange Act of 1934 (the “Exchange Act”). See Exhibits 31.1 and 31.2. This Item 4 includes information concerning the controls and control evaluations referred to in those certifications.

 

Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified by the Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are properly recorded, processed, summarized and reported within the time periods required by the Commission’s rules and forms.

 

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (principal executive officer and principal financial officer), of the effectiveness of the design and operation of these disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e), as of March 31, 2024. Based on this evaluation, the Chief Executive Officer concluded that our disclosure controls and procedures were effective as of March 31, 2024, the end of the period covered by this Quarterly Report on Form 10-Q.

 

24

 

 

There were no changes in our internal control over financial reporting that occurred during the first quarter of 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II

 

ITEM 1. LEGAL PROCEEDINGS

 

We are not aware of any pending or threatened legal proceeding against us that could have a material adverse effect on our business, operating results or financial condition. The medical device industry is characterized by frequent claims and litigation, including claims regarding patent and other intellectual property rights as well as improper hiring practices. As a result, we may be involved in various additional legal proceedings from time to time.

 

Item 1A. Risk Factors

 

Information regarding risk factors appears in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on March 29, 2023. There have been no material changes from the risk factors previously disclosed in the Annual Report on Form 10-K.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 

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ITEM 6. EXHIBITS

 

Exhibit
Number
  Exhibit Description   Filed
Herewith
  Incorporated
by Reference

herein from
Form or
Schedule
  Filing
Date
 

SEC File/

Reg.
Number

4.1   Form of Pre-Funded Warrant       Exhibit 4.1, Form 8-K   02/02/24   001-33624
                     
4.2   Form of Class E Warrant       Exhibit 4.2, Form 8-K   02/02/24   001-33624
                     
4.3   Form of Class F Warrant       Exhibit 4.3, Form 8-K   02/02/24   001-33624
                     
4.4   Form of Placement Agent Warrant       Exhibit 4.4, Form 8-K   02/02/24   001-33624
                     
4.5   Form of Warrant Agency Agreement       Exhibit 4.5, Form 8-K   02/02/24   001-33624
                     
10.1   Form of Securities Purchase Agreement       Exhibit 10.1, Form 8-K   02/02/24   001-33624
                     
10.2   Form of Placement Agency Agreement       Exhibit 10.2, Form 8-K   02/02/24   001-33624
                     
10.3   Form of Stock Purchase Agreement       Exhibit 10.1, Form 8-K   03/26/24   001-33624
                     
10.4   Form of Placement Agency Agreement       Exhibit 10.2, Form 8-K   03/26/24   001-33624
                     
31.1   Certificate of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002   X            
                     
31.2   Certificate of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002   X            
                     
32   Certifications of the Chief Executive Officer and Principal Accounting Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002   X            
                     
101.INS   Inline XBRL Instance Document   X            
                     
101.SCH   Inline XBRL Taxonomy Extension Schema Document   X            
                     
101.CAL   Inline XBRL Taxonomy Extension Calculation Linkbase Document   X            
                     
101.DEF   Inline XBRL Taxonomy Extension Definition Linkbase Document   X            
                     
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document   X            
                     
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document   X            
                     
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)                

 

26

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  SINTX Technologies, Inc.
   
Date: May 13, 2024 /s/ B. Sonny Bal
  B. Sonny Bal
 

Chief Executive Officer

(Principal Executive Officer and Principal Financial Officer)

 

27

 

Exhibit 31.1

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

 

I, B. Sonny Bal, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of SINTX Technologies, Inc.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: May 13, 2024 By: /s/ B. Sonny Bal
    B. Sonny Bal
    Chief Executive Officer

 

 

 

Exhibit 31.2

 

CERTIFICATION OF CHIEF FINANCIAL OFFICER

 

I, B. Sonny Bal, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of SINTX Technologies, Inc.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: May 13, 2024 By: /s/ B. Sonny Bal
    B. Sonny Bal
    Chief Executive Officer and Principal Financial Officer

 

 

 

Exhibit 32

 

CERTIFICATIONS UNDER SECTION 906

 

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of SINTX Technologies, Inc., a Delaware corporation (the “Company”), does hereby certify, to such officer’s knowledge, that:

 

The quarterly report for the quarter ended March 31, 2024 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: May 13, 2024 By: /s/ B. Sonny Bal
    B. Sonny Bal
    Chief Executive Officer
     
  By: /s/ B. Sonny Bal
    B. Sonny Bal
    Principal Financial Officer

 

 

v3.24.1.1.u2
Cover - shares
3 Months Ended
Mar. 31, 2024
May 08, 2024
Cover [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Quarterly Report true  
Document Transition Report false  
Document Period End Date Mar. 31, 2024  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2024  
Current Fiscal Year End Date --12-31  
Entity File Number 001-33624  
Entity Registrant Name SINTX Technologies, Inc.  
Entity Central Index Key 0001269026  
Entity Tax Identification Number 84-1375299  
Entity Incorporation, State or Country Code DE  
Entity Address, Address Line One 1885 West 2100 South  
Entity Address, City or Town Salt Lake City  
Entity Address, State or Province UT  
Entity Address, Postal Zip Code 84119  
City Area Code (801)  
Local Phone Number 839-3500  
Title of 12(b) Security Common Stock  
Trading Symbol SINT  
Security Exchange Name NASDAQ  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   122,698,454
v3.24.1.1.u2
Condensed Consolidated Balance Sheets (Unaudited) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Current assets:    
Cash and cash equivalents $ 5,762 $ 3,340
Account and other receivables, net of allowance totaling 109 and 72 respectively 483 685
Prepaid expenses and other current assets 366 539
Inventories 707 888
Other current assets 196 80
Total current assets 7,514 5,532
Inventories, net 469 333
Property and equipment, net 5,064 4,826
Intangible assets, net 20 21
Operating lease right of use asset 3,936 4,094
Other long-term assets 558 559
Total assets 17,561 15,365
Current liabilities:    
Accounts payable 448 636
Accrued liabilities 2,041 1,404
Current portion of long-term debt 233 46
Derivative liabilities 845 304
Current portion of operating lease liability 518 512
Other current liabilities 3 4
Total current liabilities 4,088 2,906
Operating lease liability, net of current portion 3,547 3,687
Total liabilities 7,635 6,593
Commitments and contingencies
Stockholders’ equity:    
Common stock, $0.01 par value, 250,000,000 shares authorized; 51,080,138 and 5,320,671 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively. 511 53
Additional paid-in capital 281,015 279,433
Accumulated deficit (271,600) (270,714)
Total stockholders’ equity 9,926 8,772
Total liabilities and stockholders’ equity 17,561 15,365
Series B Convertible Preferred Stock [Member]    
Stockholders’ equity:    
Preferred stock value
Series C Convertible Preferred Stock [Member]    
Stockholders’ equity:    
Preferred stock value
Series D Convertible Preferred Stock [Member]    
Stockholders’ equity:    
Preferred stock value
v3.24.1.1.u2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Account and other receivables, net of allowance $ 109 $ 72
Common stock, par value $ 0.01 $ 0.01
Common stock, shares authorized 250,000,000 250,000,000
Common stock, shares issued 51,080,138 5,320,671
Common stock, shares outstanding 51,080,138 5,320,671
Series B Convertible Preferred Stock [Member]    
Convertible preferred stock, par value $ 0.01 $ 0.01
Convertible preferred stock, shares authorized 130,000,000 130,000,000
Convertible preferred stock, shares issued 26 26
Convertible preferred stock, shares outstanding 26 26
Series C Convertible Preferred Stock [Member]    
Convertible preferred stock, par value $ 0.01 $ 0.01
Convertible preferred stock, shares authorized 130,000,000 130,000,000
Convertible preferred stock, shares issued 50 50
Convertible preferred stock, shares outstanding 50 50
Series D Convertible Preferred Stock [Member]    
Convertible preferred stock, par value $ 0.01 $ 0.01
Convertible preferred stock, shares authorized 130,000,000 130,000,000
Convertible preferred stock, shares issued 180 180
Convertible preferred stock, shares outstanding 180 180
v3.24.1.1.u2
Condensed Consolidated Statements of Operations (Unaudited) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Total revenue $ 687 $ 539
Costs of revenue 223 118
Gross profit 464 421
Operating expenses:    
Research and development 2,019 2,200
General and administrative 1,123 1,169
Sales and marketing 246 310
Grant expenses 273 299
Total operating expenses 3,661 3,978
Loss from operations (3,197) (3,557)
Other income (expenses):    
Interest expense (2) (2)
Interest income 19 38
Change in fair value of derivative liabilities 2,838 4,006
Offering costs of derivative liabilities (550) (786)
Other income (net) 6 8
Total other income, net 2,311 3,264
Net loss before income taxes (886) (293)
Provision for income taxes
Net loss $ (886) $ (293)
Net loss per share – basic and diluted    
Basic – net loss $ (0.05) $ (0.13)
Diluted – net loss $ (0.11) $ (1.74)
Weighted average common shares outstanding:    
Basic 17,262,895 2,272,992
Diluted 34,460,877 2,558,059
Product [Member]    
Total revenue $ 309 $ 240
Grant And Contract [Member]    
Total revenue $ 378 $ 299