Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 22, 2022 | |
Cover [Abstract] | ||
Entity Registrant Name | AWARE, INC. | |
Entity Central Index Key | 0001015739 | |
Trading Symbol | AWRE | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 21,642,260 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2022 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Shell Company | false | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Security Exchange Name | NASDAQ | |
Entity File Number | 000-21129 | |
Entity Incorporation, State or Country Code | MA | |
Entity Tax Identification Number | 04-2911026 | |
Entity Address, Address Line One | 40 Middlesex Turnpike | |
Entity Address, City or Town | Bedford | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01730 | |
City Area Code | 781 | |
Local Phone Number | 276-4000 | |
Document Quarterly Report | true | |
Document Transition Report | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 25,082 | $ 29,963 |
Accounts receivable, net of allowance for doubtful accounts of $74 and $138 at March 31, 2022 and December 31, 2021 | 4,131 | 3,763 |
Unbilled receivables | 3,175 | 3,087 |
Tax receivable | 1,411 | 1,411 |
Prepaid expenses and other current assets | 985 | 591 |
Total current assets | 34,784 | 38,815 |
Property and equipment, net | 3,095 | 3,216 |
Intangible assets, net | 3,118 | 3,222 |
Goodwill | 3,120 | 3,120 |
Note receivable | 2,507 | 0 |
Total assets | 46,624 | 48,373 |
Current liabilities: | ||
Accounts payable | 472 | 283 |
Accrued expenses | 1,260 | 1,909 |
Deferred revenue | 3,071 | 3,549 |
Current portion of contingent acquisition payment | 406 | 0 |
Total current liabilities | 5,209 | 5,741 |
Long-term deferred revenue | 229 | 191 |
Long-term portion of contingent acquisition payment | 513 | 919 |
Total long-term liabilities | 742 | 1,110 |
Stockholders’ equity: | ||
Preferred stock, $1.00 par value; 1,000,000 shares authorized, none outstanding | 0 | 0 |
Common stock, $.01 par value; 70,000,000 shares authorized; issued and outstanding of 21,642,260 as of March 31, 2022 and 21,613,982 as of December 31, 2021 | 216 | 216 |
Additional paid-in capital | 98,208 | 97,778 |
Accumulated deficit | (57,751) | (56,472) |
Total stockholders’ equity | 40,673 | 41,522 |
Total liabilities and stockholders’ equity | $ 46,624 | $ 48,373 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts (in dollars) | $ 74 | $ 138 |
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 70,000,000 | 70,000,000 |
Common stock, shares issued | 21,642,260 | 21,613,982 |
Common stock, shares outstanding | 21,642,260 | 21,613,982 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue: | ||
Total revenue | $ 4,692 | $ 4,419 |
Costs and expenses: | ||
Cost of sales | 314 | 383 |
Research and development | 2,424 | 2,396 |
Selling and marketing | 1,781 | 1,652 |
General and administrative | 1,461 | 1,437 |
Total costs and expenses | 5,980 | 5,868 |
Operating loss | (1,288) | (1,449) |
Interest income | 9 | 1 |
Net loss | $ (1,279) | $ (1,448) |
Net loss per share – basic | $ (0.06) | $ (0.07) |
Net loss per share – diluted | $ (0.06) | $ (0.07) |
Weighted-average shares – basic | 21,642 | 21,494 |
Weighted-average shares – diluted | 21,642 | 21,494 |
Software licenses | ||
Revenue: | ||
Total revenue | $ 2,628 | $ 2,367 |
Software maintenance | ||
Revenue: | ||
Total revenue | 1,661 | 1,536 |
Services and other | ||
Revenue: | ||
Total revenue | $ 403 | $ 516 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (1,279) | $ (1,448) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 225 | 177 |
Stock-based compensation | 430 | 197 |
Interest receivable | (7) | |
Changes in assets and liabilities: | ||
Accounts receivable | (368) | (587) |
Unbilled receivables | (88) | (253) |
Prepaid expenses and other current assets | (394) | 51 |
Accounts payable | 190 | 10 |
Accrued expenses | (650) | (229) |
Deferred revenue | (440) | (389) |
Net cash used in operating activities | (2,381) | (2,471) |
Cash flows from investing activities: | ||
Investment in note receivable | (2,500) | |
Net cash used in investing activities | (2,500) | |
Cash flows from financing activities: | ||
Payments made for taxes of employees who surrendered shares related to unrestricted stock | (54) | |
Net cash used in financing activities | (54) | |
Decrease in cash and cash equivalents | (4,881) | (2,525) |
Cash and cash equivalents, beginning of period | 29,963 | 38,565 |
Cash and cash equivalents, end of period | $ 25,082 | $ 36,040 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Balance at Dec. 31, 2020 | $ 45,670 | $ 214 | $ 96,104 | $ (50,648) |
Balance (in shares) at Dec. 31, 2020 | 21,379,000 | |||
Issuance of unrestricted stock | $ 1 | (1) | ||
Issuance of unrestricted stock (in shares) | 131,000 | |||
Shares surrendered by employees to pay taxes related to unrestricted stock | (54) | (54) | ||
Shares surrendered by employees to pay taxes related to unrestricted stock (in shares) | (16,000) | |||
Stock-based compensation expense | 197 | 197 | ||
Net loss | (1,448) | (1,448) | ||
Balance at Mar. 31, 2021 | 44,365 | $ 215 | 96,246 | (52,096) |
Balance (in shares) at Mar. 31, 2021 | 21,494,000 | |||
Balance at Dec. 31, 2021 | $ 41,522 | $ 216 | 97,778 | (56,472) |
Balance (in shares) at Dec. 31, 2021 | 21,613,982 | 21,614,000 | ||
Issuance of unrestricted stock (in shares) | 28,000 | |||
Stock-based compensation expense | $ 430 | 430 | ||
Net loss | (1,279) | (1,279) | ||
Balance at Mar. 31, 2022 | $ 40,673 | $ 216 | $ 98,208 | $ (57,751) |
Balance (in shares) at Mar. 31, 2022 | 21,642,260 | 21,642,000 |
Description of the Company and
Description of the Company and Basis of Presentation | 3 Months Ended |
Mar. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of the Company and Basis of Presentation | Note 1 – Description of the Company and Basis of Presentation Description of the Company We are a global leader in biometrics software offerings and solutions. Our portfolio enables government agencies and commercial entities to enroll, identify, authenticate and enable using biometrics, which comprise physiological characteristics, such as fingerprints, faces, irises and voices. • Enroll: Register biometric identities into an organization’s secure database • Identify: Utilize an organization’s secure database to accurately identify individuals using biometric data • Authenticate: Provide frictionless multi-factor, passwordless access to secured accounts and databases with biometric verification • Enable: Manage the lifecycle of secure identities through optimized biometric interchanges We have been engaged in this business since 1993. Our comprehensive portfolio of biometric solutions is based on innovative, robust products designed explicitly for ease of integration, including customer-managed and integration ready biometric frameworks, platforms, software development kits (SDKs) and services. Principal government applications of biometrics systems include border control, visa applicant screening, law enforcement, national defense, intelligence, secure credentialing, access control, and background checks. Principal commercial applications include mobile enrollment, user authentication, identity proofing, and secure transaction enablement. Our products span multiple biometric modalities including fingerprint, face, iris and voice, and provide interoperable, standards-compliant, field-proven biometric functionality. Our products are used to capture, verify, format, compress and decompress biometric images as well as aggregate, analyze, process, match and transport those images and templates within biometric systems. For large deployments, we may provide project management and software engineering services. We sell our biometrics software products and services globally through a multifaceted distribution strategy using systems integrators, original equipment manufacturers (OEMs), value added resellers (VARs), partners, and directly to end user customers. Certain amounts in the consolidated financial statements and associated notes may not add due to rounding. All percentages have been calculated using unrounded amounts. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions for Form 10-Q and therefore do not include all information and notes necessary for a complete presentation of our financial position, results of operations and cash flows, in conformity with generally accepted accounting principles. We filed audited financial statements which included all information and notes necessary for such presentation for the two years ended December 31, 2021 in conjunction with our 2021 Annual Report on Form 10-K. This Form 10-Q should be read in conjunction with that Form 10-K. The accompanying unaudited consolidated balance sheets, statements of operations, statements of cash flows, and statements of stockholders’ equity reflect all adjustments (consisting only of normal recurring items) which are, in the opinion of management, necessary for a fair presentation of financial position at March 31, 2022, and of operations and cash flows for the interim periods ended March 31, 2022. The results of operations for the interim periods ended March 31, 2022 are not necessarily indicative of the results to be expected for the year. Principles of Consolidation The consolidated financial statements include the accounts of Aware, Inc. and its subsidiaries, Aware Security Corporation and Fortr3ss, Inc. Intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America requires us 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 financial statements and the reported amount of revenues and expenses during the reporting period. The most significant estimates included in the financial statements pertain to revenue recognition, reserves for doubtful accounts, valuation of acquired assets and assumed liabilities in business combinations, valuation of earn-out liability, valuation of the investment in the note receivable, goodwill and long-lived asset impairment and valuation allowance for deferred income tax assets. Actual results could differ from those estimates. Recent Accounting Pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The ASU requires contract assets and contracts liabilities to be accounted for as if they (“the acquirer”) entered into the original contract at the same time and same date as the acquiree. The guidance is to be effective for reporting periods beginning after December 15, 2022, with early adoption permitted. We have elected not to early adopt and we are continuing to assess the impact of the standard on our consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses of Financial Instruments Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) Effective Dates, |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2022 | |
Revenue From Contract With Customer [Abstract] | |
Revenue Recognition | Note 2 – Revenue Recognition We recognize revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). Under ASC 606, 1. Identify the contract with the customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) each performance obligation is satisfied. We categorize revenue as software licenses, software maintenance, or services and other. Revenue from software licenses is recognized at a point in time upon delivery, provided all other revenue recognition criteria are met. In addition to selling software licenses, software maintenance and software services on a standalone basis, a significant portion of our contracts include multiple performance obligations, which require an allocation of the transaction price to each distinct performance obligation based on a relative standalone selling price (“SSP ” ) basis. The SSP is the price at which we would sell a promised good or service separately to a customer. The best estimate of SSP is the observable price of a good o r service when we sell that good or service separately. A contractually stated price or a list price for a good or service may be the SSP of that good or service. We use a range of selling prices to estimate SSP when we sell each of the goods and services separately and need to determine whether there is a discount that needs to be allocated based on the relative SSP of the various goods and services within multi ple performance obligation arrangements . In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we typically determine the SSP using an adjusted market assessment approach using information that may include market conditions and other observable inputs. We typically have more than one SSP for individual goods and services due to the stratification of those goods and services by customer. In these instances, we may use information such as the nature of the customer and distribution channel in determining the SSP. When software licenses and significant customization engineering services are sold together, they are accounted for as a combined performance obligation, as the software licenses are generally highly dependent on, and interrelated with, the associated customization services and therefore are not distinct performance obligations. Revenue for the combined performance obligation is recognized over time as the services are delivered using an input method (i.e., labor hours incurred as a percentage of total labor hours budgeted). When subscription-based software is sold, the subscription-based software and software maintenance are generally considered distinct performance obligations. The transaction price is allocated to subscription-based software and the software maintenance based on the relative SSP of each performance obligation. We sell subscription-based software for a fixed fee and/or a usage-based royalty fee, sometimes subject to a minimum guarantee. When the amount is in the form of a fixed fee, including the guaranteed minimum in subscription-based royalties, revenue is allocated to the subscription-based software and recognized at a point in time upon delivery, provided all other revenue recognition criteria are met. Revenue allocated to the software maintenance is recognized over the contract term on a straight-line basis. Any subscription-based software fees earned not subject to the guaranteed minimum or earned in excess of the minimum amount are recognized as revenue when the subsequent usage occurs. Our contracts can include variable fees, such as the option to purchase additional usage of a previously delivered software license. We may also provide pricing concessions to clients, a business practice that also gives rise to variable fees in contracts. We include variable fees in the determination of total transaction price if it is not probable that a future significant reversal of revenue will occur. We use the expected value or most likely value amount, whichever is more appropriate for specific circumstances, to estimate variable consideration, and the estimates are based on the level of historical price concessions offered to clients. The amount of consideration is not adjusted for a significant financing component if the time between payment and the transfer of the related good or service is expected to be one year or less under the practical expedient in ASC 606-10-32-18. Our revenue arrangements are typically accounted for under such expedient, as payment is typically due within 30 to 60 days. As of March 31, 2022 and 2021, none of our contracts contained a significant financing component. Also, with our acquisition of FortressID and adaption of our current products to be delivered in a hosted environment with AwareID, we expect to recognize revenue from our SaaS offerings in future periods. SaaS offerings are recognized ratably over the subscription period. For the three months ended March 31, 2022 and 2021, we did not generate revenue from SaaS contracts. Disaggregation of Revenues We organize ourselves into a single segment that reports to the Chief Executive Officer who is our chief operating decision maker. We conduct our operations in the United States and sell our products and services to domestic and international customers. Revenues generated from the following geographic regions for the three months ended March 31 , 202 2 and 202 1 w ere (in thousands): Three Months Ended March 31, 2022 2021 United States $ 2,036 $ 2,223 United Kingdom 377 679 Rest of World 2,279 1,517 $ 4,692 $ 4,419 Revenue by timing of transfer of goods or services for the three months ended March 31, 2022 and 2021 were (in thousands): Three Months Ended March 31, 2022 2021 Goods or services transferred at a point in time $ 2,693 $ 2,408 Goods or services transferred over time 1,999 2,011 $ 4,692 $ 4,419 Revenue by contract type for the three months ended March 31, 2022 and 2021 were (in thousands): Three Months Ended March 31, 2022 2021 License and service contracts $ 3,331 $ 3,634 Subscription-based contracts 1,361 785 $ 4,692 $ 4,419 Revenue from subscription-based contracts include revenue that may be recognized at a point in time or over time and be part of a fixed fee and or minimum guarantee as well as fees earned and allocated to software maintenance. Contract Balances When the timing of our delivery of goods or services is different from the timing of payments made by customers, we recognize either a contract asset (performance precedes contractual due date) or a contract liability (customer payment precedes performance). Customers that prepay are represented by the deferred revenue below until the performance obligation is satisfied. Our contract assets consist of unbilled receivables. Our contract liabilities consist of deferred (unearned) revenue, which is generally related to software maintenance contracts. We classify deferred revenue as current or noncurrent based on the timing of when we expect to recognize revenue. The following tables present changes in our contract assets and liabilities during the three months ended March 31, 2022 and 2021 (in thousands): Balance at Beginning of Period Revenue Recognized In Advance of Billings Billings Balance at End of Period Three months ended March 31, 2021 Contract assets: Unbilled receivables $ 2,229 $ 690 $ (473 ) $ 2,446 Three months ended March 31, 2022 Contract assets: Unbilled receivables $ 3,087 $ 1,486 $ (1,398 ) $ 3,175 Balance at Beginning of Period Billings Revenue Recognized Balance at End of Period Three months ended March 31, 2021 Contract liabilities: Deferred revenue $ 3,933 $ 1,435 $ (1,825 ) $ 3,543 Three months ended March 31, 2022 Contract liabilities: Deferred revenue $ 3,740 $ 1,221 $ (1,661 ) $ 3,300 Remaining Performance Obligations Remaining performance obligations represent the transaction price from contracts for which work has not been performed or goods and services have not been delivered. We expect to recognize revenue on approximately 66% of the remaining performance obligations over the next 12 months, with the remainder recognized thereafter. As of March 31, 2022, the aggregate amount of the transaction price allocated to remaining performance obligations for contracts with a duration greater than one year was $2.4 million. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 3 – Fair Value Measurements The FASB Codification defines fair value, and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy under the FASB Codification are: Level 1 – valuations that are based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date; Level 2 – valuations that are based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly; and Level 3 – valuations that require inputs that are both significant to the fair value measurement and unobservable. Cash and cash equivalents, which primarily include money market mutual funds, were $25.1 million and $30.0 million as of March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values included the following (in thousands): Fair Value Measurement at March 31, 2022 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Money market funds (included in cash and cash equivalents) $ 24,454 $ — $ — Note receivable — — 2,500 Total assets $ 24,454 $ — $ 2,500 Liabilities Contingent acquisition payment $ — $ — $ 919 Total $ — $ — $ 919 The fair value of the investment in note receivable was negotiated on an arm’s length basis and the total investment of $2.5 million is representative of the total fair value of the investment. The fair value of our contingent acquisition payment was determined using a Monte Carlo simulation and there was no change in fair value from the initial recording date (acquisition date) to March 31, 2022 or December 31, 2021 due to no change in forecasted revenue and a di minimis impact from the present value factor. As of December 31, 2021, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values included the following (in thousands): Fair Value Measurement at December 31, 2021 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Money market funds (included in cash and cash equivalents) $ 28,952 $ — $ — Total assets $ 28,952 $ — $ — Liabilities Contingent acquisition payment $ — $ — $ 919 Total $ — $ — $ 919 The fair value of our contingent acquisition payment was determined using a Monte Carlo simulation and there was no change in fair value from the initial recording date (acquisition date) to December 31, 2021 due to the proximity of the acquisition to year-end. |
Acquisition
Acquisition | 3 Months Ended |
Mar. 31, 2022 | |
Business Combinations [Abstract] | |
Acquisition | Note 4 – Acquisition Fortress - In December 2021, we acquired 100% of the outstanding shares and acquired all of the assets and liabilities of FortressID for a purchase price of $3.4 million, which consisted of $2.5 million of cash consideration and an earnout with a fair value of $0.9 million. The maximum earnout payment is $4.0 million and requires cash payments of up to $2.0 million for set revenue targets in 2022 and another $2.0 million for set revenue targets in 2023. The acquisition of FortressID, expands our offerings around identity proofing-enhancing its onboarding, verification and authentication offerings to directly address financial compliance requirements and enable organizations to mitigate risk and curtail increasing fraud. The acquisition was accounted for as a business combination, whereby all the assets acquired, and liabilities assumed were recognized at fair value on the acquisition date, with any excess of the consideration transferred over the fair value of the net assets acquired recognized as goodwill. Unaudited pro forma results of operations assuming the above acquisition had taken place at the beginning of each period are not provided because the historical operating results and pro forma results would not be materially different from reported results for the periods presented. The fair values recorded were based on a valuation performed by a third-party valuation specialist and the estimates and assumptions used in such valuation are subject to change, within the measurement period (up to one year from the acquisition date). The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition (in thousands): Customer relationships $ 1,740 Developed technology 430 Trade name / trademarks 10 Goodwill 1,469 Gross assets acquired 3,649 Net working capital (11) Fair value of contingent consideration (919) Net assets acquired $ 2,719 After allocating the purchase price to the assets acquired and liabilities assumed based on their fair values at the date of acquisition, we recorded goodwill of approximately $1.5 million, which included $0.3 million related to the release of certain deferred tax assets. Goodwill largely consists of expected synergies to be realized from combining operations. The goodwill is deductible for income tax purposes. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 5 – Intangible Assets The fair value of intangible assets and their estimated useful lives as of March 31, 2022 are as follows (dollars in thousands): Useful Life Gross Amount Accumulated Amortization Net Book Value Customer relationships 8 and 10 years $ 2,680 $ 205 $ 2,475 Developed technology 5 and years 710 92 618 Trade name trademarks 3 and 7 years 30 5 25 $ 3,420 $ 302 $ 3,118 During the three months ended March 31, 2022 and 2021 we recorded $ 104 and $ 44 thousand of intangible asset amortization expense , respectively . We expect to record amortization expense for the remainder of 2022 and each subsequent year as follows (in thousands): 2022 $ 311 2023 415 2024 415 2025 412 2026 412 Thereafter 1,153 $ 3,118 |
Subscription Agreement
Subscription Agreement | 3 Months Ended |
Mar. 31, 2022 | |
Capitalization Longterm Debt And Equity [Abstract] | |
Subscription Agreement | Note 6 – Subscription Agreement On March 11, 2022, concurrently with our entry into a mutual reseller arrangement with MIRACL Technologies Limited (“MIRACL”), we entered into a subscription agreement with Omlis Limited, a limited company incorporated and registered in England and Wales and the parent of MIRACL (“Omlis”). We purchased $2.5 million of Omlis’ Note Receivable (“Note”) that accrues interest at 5% annually with a maturity date of March 11, 2026. Prior to maturity, we have the right to convert the Note into the securities issued in a future financing at a 20% discount from the price per share paid by the investors in that financing. If the Note remains outstanding on the maturity date, the Note shall, at the option of the holders of a majority of the outstanding Note, (i) be converted into the most senior shares in Omlis, (ii) be redeemed by payment in cash of the Note and all accrued but unpaid interest or (iii) remain outstanding. The conversion right was accounted for as an embedded derivative which required bifurcation and fair value accounting under ASC 815, Derivatives and Hedging. The fair value of the derivative as of the March 11, 2022 agreement date was $0 and there were no changes in fair value as of March 31, 2022. In connection with the sale of the Note, Omlis granted us a right of first refusal for 18 months with respect to any proposed sale by Omlis of equity securities constituting 20% or more of the outstanding voting power of Omlis or all or substantially all of the assets of Omlis or any of its material subsidiaries. Also, in connection with the sale of the Note, Omlis issued us a warrant that expires on September 11, 2023, which allows us to purchase up to 8% of the total equity shares in Omlis at a price per share of $33.91. We recorded the Note and warrants at their fair values in accordance with ASC 825, Financial Instruments, for the Note and ASC 815, Derivatives and Hedging, for the warrants, which were $2.5 million and $0, respectively as of March 31, 2022. Accrued interest receivable of $8 thousand was earned during the three month period ended March 31, 2022. We assigned a value of $0 to the warrant, since the value was deemed de minimis and was not an integral part of the investment. |
Computation of Earnings per Sha
Computation of Earnings per Share | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Computation of Earnings per Share | Note 7 – Computation of Earnings per Share Basic earnings per share is computed by dividing net income or loss by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing net income or loss by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For the purposes of this calculation, stock options are considered common stock equivalents in periods in which they have a dilutive effect. Stock options that are anti-dilutive are excluded from the calculation. Potential common stock equivalents were not included in the per share calculation below for diluted earnings per share, because we had a net loss and the effect of their inclusion would be anti-dilutive. |
Equity and Stock-based Compensa
Equity and Stock-based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Equity and Stock-based Compensation | Note 8– Equity and Stock-based compensation The following table presents stock-based compensation expenses included in our unaudited consolidated statements of operations (in thousands): Three Months Ended March 31, 2022 2021 Cost of services $ 5 $ 3 Research and development 82 30 Selling and marketing 96 33 General and administrative 247 131 Stock-based compensation expense $ 430 $ 197 Stock Options - We did not grant stock options in the three months ended March 31, 2022. We granted stock options for 2,875,000 Unrestricted Stock Grants - We grant unrestricted shares of stock under our 2001 Nonqualified Stock Plan. Stock-based compensation expense for stock grants is determined based on the fair market value of our stock on the date of grant, provided the number of shares in the grant is fixed on the grant date. In the three months ended March 31, 2022 we granted an aggregate 107,921 shares of unrestricted stock. The shares are scheduled to be issued in two installments of 61,460 and 46,461 shortly after June 30, 2022 and December 31, 2022, respectively, provided each grantee is serving as a director, officer or employee on those dates. Total stock-based compensation expense related to these grants is $0.4 million, of which $0.1 million was charged to expense in the three months ended March 31, 2022. We anticipate the remaining $0.3 million will be charged to expense ratably over the remaining three quarters of 2022. In the three months ended March 31, 2021 we granted an aggregate 56,533 shares of unrestricted stock to directors. The shares were issued in two equal installments shortly after June 30, 2021 and December 31, 2021. Total stock-based compensation expense related to these grants is $0.3 million, of which $30 thousand was charged to expense in the three months ended March 31, 2021. The remaining $0.2 million was charged to expense ratably over the remaining three quarters of 2021. We also granted 120,000 shares in September and October 2019 to be issued in four equal installments shortly after their anniversaries of their grant dates in September and October 2020, 2021, 2022, and 2023, provided the grantee is serving as a director, officer, or employee on those dates. The total stock-based compensation expense related to the 120,000 shares granted is $0.4 million of which $21,000 was charged to expense in the three months ended March 31 2022 and 2021. We anticipate the remaining $0.1 million will be charged to expense ratably through 2023. Share Purchases - On March 1, 2022, our Board of Directors authorized a new stock repurchase program pursuant to which we may purchase up to $10.0 million of our common stock, all of which is still available to utilize to repurchase shares as of March 31, 2022. During the three months ended March 31, 2022 we did not repurchase any shares of our common stock. The shares may be purchased from time to time in the open market or through privately negotiated transactions at management’s discretion, depending upon market conditions and other factors. The authorization to repurchase shares of our common stock expires on December 31, 2023. Repurchases will be made under the program using our own cash resources and will be in accordance with Rule 10b-15 under the Securities Exchange Act of 1934, and other applicable laws, rules and regulations, which would permit repurchases to occur during periods when we might otherwise be precluded from making purchases under insider trading laws or company policy. The program does not obligate us to acquire any particular amount of common stock and the program may be modified or suspended at any time at our Board of Director’s discretion |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9 – Income Taxes During the three months ended March 31, 2022 and 2021, we recorded no income tax benefits for the net operating losses incurred or for the research and development tax credits generated due to the uncertainty of realizing a benefit from those items. We have evaluated the positive and negative evidence bearing upon our ability to realize our deferred tax assets, which primarily consist of net operating loss carryforwards and research and development tax credits. We considered the history of cumulative net losses, estimated future taxable income and prudent and feasible tax planning strategies and we have concluded that it is more likely than not that we will not realize the benefits of deferred tax assts. As a result, as of March 31, 2022 and December 31, 2021, we recorded a full valuation allowance against our net deferred tax assts. The Coronavirus Aid, Relief and Economic Security Act (CARES Act) was signed into law on March 27, 2020. The CARES Act contained specific relief and stimulus measures including allowing net operating losses originating in 2018 through 2020 to be carried back five years to offset taxable income in the carryback period. Separately, the enactment of the Tax Cut and Jobs Act in 2017 allowed taxpayers to claim a refund for alternative minimum tax credits over a period of years. The CARES Act enacted during the first quarter of 2020 allows for the entire amount of the credit to be refunded. We have reviewed the impact of the CARES Act enactment on the income tax provision and have determined that, as a result of the net operating loss carryback provision, we can obtain a tax benefit if we were to carry back the forecasted 2020 net operating loss to the five year carryback period. The carryback of the estimated loss would result in a refundable federal tax credit of approximately $1.4 million and an increase in research credit carryforwards previously utilized. The federal tax credit can be refunded in the future, as we decided to carry back the loss reported on the filed 2020 tax return. Upon filing our 2020 tax return, we reclassified the federal tax credit as a current receivable. Due to the recent loss history, continued investments in the Company, and our future projections of income, we will benefit from the 2020 loss to the extent of the available tax refund and will maintain a full valuation allowance on all other deferred tax assets, including any increase in research credit carryforward resulting from a potential carryback. |
Potential Sale of Building and
Potential Sale of Building and Lease of Corporate Office | 3 Months Ended |
Mar. 31, 2022 | |
Potential Sale Of Building And Lease Of Corporate Office [Abstract] | |
Potential Sale of Building and Lease of Corporate Office | Note 10 – Potential Sale of Building and Lease of Corporate Office Potential Sale of Building – On April 26, 2021 (the “Contract Date”), we entered into an Agreement of Purchase and Sale (the “Original Agreement”) with FDS Bedford, LLC or its designee (“Purchaser”). The Purchase and Sale Agreement provides that we are obligated to sell the property at 40 Middlesex Turnpike, Bedford, Massachusetts (the “Property”) to the Purchaser for $8.0 million (the “Transaction”), subject to the Purchaser notifying Aware within 180 days after the Contract Date that it wishes to proceed with the closing of the Transaction (“Closing”) and further subject to the satisfaction or waiver on or before the Closing of the conditions set forth in the Purchase and Sale Agreement. On November 15, 2021 we entered into an amendment to the original agreement where the purchase price for the Property was increased from $8.0 million to $8.9 million. On March 30, 2022, we entered into an Additional Amendment (“Amendment”), where the closing date for the sale of the Property to Purchaser shall be June 30, 2022 or such earlier date as we and Purchaser agree. In addition, if Purchaser defaults on its obligations under the Amendment, including its obligation to proceed to closing, or if certain conditions set forth in the Purchase Agreement are not satisfied due to a default by Purchaser and we elect not to proceed with the sale, and if that default is not cured or that condition is not satisfied by the later of the (i) the closing date and (ii) the date fifteen business days after we give Purchaser written notice of the default or failure, then we will be entitled to total damages from Purchaser equal to $7 million and the Purchase Agreement will terminate. In connection with the amendment, Purchaser deposited an additional $125 thousand into a nonrefundable escrow for a total of $0.3 million with a title company which is non-refundable. The deposit will be credited against the $8.9 million purchase price at the closing. We will be obligated to pay certain brokerage commissions at the Closing of $0.3 million. Lease of Corporate Office – On March 1, 20022 we entered into a Lease Agreement (“Lease”) with 76/80 BURLINGTON GROUP LLC (the “Landlord”). Per the Original Lease, we will lease approximately 20,730 rentable square feet at 76 Blanchard Road in Burlington, Massachusetts (the “Leased Space”) for a term of ten years and six months, which includes a one-time termination right after seven years and six months. We intend to use the Leased Space as our principal executive offices. The term of the Lease commences on the date that the landlord notifies us that the planned construction on the Leased Space is substantially complete. The Lease provides for an aggregate of $8.2 million of rent due over the Lease term and also provides a renewal option for up to two additional terms of five years each. On March 30, 2022, we entered into a First Amendment of Lease (the “First Amendment”) to our Lease with the Landlord. Pursuant to the First Amendment, we may terminate the Lease by delivering notice to the Landlord at any time prior June 30, 2022. If we elect to terminate the Lease, the Landlord will be entitled to immediately retain (i) $150 thousand that we deposited as an escrow at the time we entered into the Original Lease and (ii) $1,339 from our security deposit for each day during the period beginning on April 1, 2022 and ending on the day we exercise our termination right. If we do not elect to terminate the Lease on or prior to June 30, 2022, all escrow amounts will continue to be held according to the Lease and the six-month free rent period under the Lease will be reduced by one day for each day during the period beginning on April 1, 2022 and ending on the earlier of June 30, 2022 or the date the Landlord receives our written notice waiving our right to terminate the Lease. We anticipate the lease to be accounted for under ASC 842, Leases. |
Description of the Company an_2
Description of the Company and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions for Form 10-Q and therefore do not include all information and notes necessary for a complete presentation of our financial position, results of operations and cash flows, in conformity with generally accepted accounting principles. We filed audited financial statements which included all information and notes necessary for such presentation for the two years ended December 31, 2021 in conjunction with our 2021 Annual Report on Form 10-K. This Form 10-Q should be read in conjunction with that Form 10-K. The accompanying unaudited consolidated balance sheets, statements of operations, statements of cash flows, and statements of stockholders’ equity reflect all adjustments (consisting only of normal recurring items) which are, in the opinion of management, necessary for a fair presentation of financial position at March 31, 2022, and of operations and cash flows for the interim periods ended March 31, 2022. The results of operations for the interim periods ended March 31, 2022 are not necessarily indicative of the results to be expected for the year. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Aware, Inc. and its subsidiaries, Aware Security Corporation and Fortr3ss, Inc. Intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America requires us 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 financial statements and the reported amount of revenues and expenses during the reporting period. The most significant estimates included in the financial statements pertain to revenue recognition, reserves for doubtful accounts, valuation of acquired assets and assumed liabilities in business combinations, valuation of earn-out liability, valuation of the investment in the note receivable, goodwill and long-lived asset impairment and valuation allowance for deferred income tax assets. Actual results could differ from those estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The ASU requires contract assets and contracts liabilities to be accounted for as if they (“the acquirer”) entered into the original contract at the same time and same date as the acquiree. The guidance is to be effective for reporting periods beginning after December 15, 2022, with early adoption permitted. We have elected not to early adopt and we are continuing to assess the impact of the standard on our consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses of Financial Instruments Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) Effective Dates, |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Revenues Generated from Geographic Regions | Revenues generated from the following geographic regions for the three months ended March 31 , 202 2 and 202 1 w ere (in thousands): Three Months Ended March 31, 2022 2021 United States $ 2,036 $ 2,223 United Kingdom 377 679 Rest of World 2,279 1,517 $ 4,692 $ 4,419 |
Schedule of Revenue by Timing of Transfer of Goods or Services | Revenue by timing of transfer of goods or services for the three months ended March 31, 2022 and 2021 were (in thousands): Three Months Ended March 31, 2022 2021 Goods or services transferred at a point in time $ 2,693 $ 2,408 Goods or services transferred over time 1,999 2,011 $ 4,692 $ 4,419 |
Schedule of Revenue by Contract Type | Revenue by contract type for the three months ended March 31, 2022 and 2021 were (in thousands): Three Months Ended March 31, 2022 2021 License and service contracts $ 3,331 $ 3,634 Subscription-based contracts 1,361 785 $ 4,692 $ 4,419 |
Schedule of Changes in Contract Assets and Liabilities | The following tables present changes in our contract assets and liabilities during the three months ended March 31, 2022 and 2021 (in thousands): Balance at Beginning of Period Revenue Recognized In Advance of Billings Billings Balance at End of Period Three months ended March 31, 2021 Contract assets: Unbilled receivables $ 2,229 $ 690 $ (473 ) $ 2,446 Three months ended March 31, 2022 Contract assets: Unbilled receivables $ 3,087 $ 1,486 $ (1,398 ) $ 3,175 Balance at Beginning of Period Billings Revenue Recognized Balance at End of Period Three months ended March 31, 2021 Contract liabilities: Deferred revenue $ 3,933 $ 1,435 $ (1,825 ) $ 3,543 Three months ended March 31, 2022 Contract liabilities: Deferred revenue $ 3,740 $ 1,221 $ (1,661 ) $ 3,300 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets Measured at Fair Value on a Recurring Basis | As of March 31, 2022, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values included the following (in thousands): Fair Value Measurement at March 31, 2022 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Money market funds (included in cash and cash equivalents) $ 24,454 $ — $ — Note receivable — — 2,500 Total assets $ 24,454 $ — $ 2,500 Liabilities Contingent acquisition payment $ — $ — $ 919 Total $ — $ — $ 919 As of December 31, 2021, our assets that are measured at fair value on a recurring basis and whose carrying values approximate their respective fair values included the following (in thousands): Fair Value Measurement at December 31, 2021 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Money market funds (included in cash and cash equivalents) $ 28,952 $ — $ — Total assets $ 28,952 $ — $ — Liabilities Contingent acquisition payment $ — $ — $ 919 Total $ — $ — $ 919 |
Acquisition (Tables)
Acquisition (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fortress ID | |
Summary of Fair Value of Assets Acquired and Liabilities Assumed At Date of Acquisition | The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition (in thousands): Customer relationships $ 1,740 Developed technology 430 Trade name / trademarks 10 Goodwill 1,469 Gross assets acquired 3,649 Net working capital (11) Fair value of contingent consideration (919) Net assets acquired $ 2,719 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Fair Value of Intangible Assets and Estimated Useful Lives | The fair value of intangible assets and their estimated useful lives as of March 31, 2022 are as follows (dollars in thousands): Useful Life Gross Amount Accumulated Amortization Net Book Value Customer relationships 8 and 10 years $ 2,680 $ 205 $ 2,475 Developed technology 5 and years 710 92 618 Trade name trademarks 3 and 7 years 30 5 25 $ 3,420 $ 302 $ 3,118 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | We expect to record amortization expense for the remainder of 2022 and each subsequent year as follows (in thousands): 2022 $ 311 2023 415 2024 415 2025 412 2026 412 Thereafter 1,153 $ 3,118 |
Equity and Stock-based Compen_2
Equity and Stock-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Stock-based Compensation Expenses Included in Unaudited Consolidated Statements of Operations | The following table presents stock-based compensation expenses included in our unaudited consolidated statements of operations (in thousands): Three Months Ended March 31, 2022 2021 Cost of services $ 5 $ 3 Research and development 82 30 Selling and marketing 96 33 General and administrative 247 131 Stock-based compensation expense $ 430 $ 197 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Revenue From Contract With Customer [Abstract] | |
Practical expedient for financing components | true |
Minimum period of payment of transaction price in contract with customer | 30 days |
Maximum period of payment of transaction price in contract with customer | 60 days |
Percentage of remaining performance obligations expected to be recognized as revenue | 66.00% |
Minimum period of remaining performance obligations | 12 months |
Revenue recognition performance obligation transaction price | $ 2.4 |
Revenue, Practical Expedient, Incremental Cost of Obtaining Contract [true false] | true |
Revenue Recognition - Revenues
Revenue Recognition - Revenues Generated Following Geographic Regions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 4,692 | $ 4,419 |
Operating Segments | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 4,692 | 4,419 |
Operating Segments | United States | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 2,036 | 2,223 |
Operating Segments | United Kingdom | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 377 | 679 |
Operating Segments | Rest of World | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 2,279 | $ 1,517 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Timing of Transfer of Goods or Services (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 4,692 | $ 4,419 |
Goods or services transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 2,693 | 2,408 |
Goods or services transferred over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 1,999 | $ 2,011 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Revenue by Contract Type (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 4,692 | $ 4,419 |
License and Service Contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 2,628 | 2,367 |
Operating Segments | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 4,692 | 4,419 |
Operating Segments | License and Service Contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 3,331 | 3,634 |
Operating Segments | Subscription-based Contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 1,361 | $ 785 |
Revenue Recognition - Changes i
Revenue Recognition - Changes in Contract Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue From Contract With Customer [Abstract] | ||
Unbilled receivables, Balance at Beginning of Period | $ 3,087 | $ 2,229 |
Unbilled receivables, Revenue Recognized In Advance of Billings | 1,486 | 690 |
Unbilled receivables, Billings | (1,398) | (473) |
Unbilled receivables, Balance at End of Period | $ 3,175 | $ 2,446 |
Revenue Recognition - Changes_2
Revenue Recognition - Changes in Contract Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue From Contract With Customer [Abstract] | ||
Deferred revenue, Balance at Beginning of Period | $ 3,740 | $ 3,933 |
Deferred revenue, Billings | 1,221 | 1,435 |
Deferred revenue, Revenue Recognized | (1,661) | (1,825) |
Deferred revenue, Balance at End of Period | $ 3,300 | $ 3,543 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional information (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Schedule of Available-for-sale Securities | ||||
Cash and cash equivalents | $ 25,082 | $ 29,963 | $ 36,040 | $ 38,565 |
Fair Value, Measurements, Recurring [Member] | ||||
Schedule of Available-for-sale Securities | ||||
Total fair value of the instrument | $ 2,500 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Schedule of Available-for-sale Securities | ||
Note receivable | $ 2,500 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Schedule of Available-for-sale Securities | ||
Total assets | 24,454 | $ 28,952 |
Contingent acquisition payment | 0 | 0 |
Total | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Schedule of Available-for-sale Securities | ||
Total assets | 0 | 0 |
Contingent acquisition payment | 0 | 0 |
Total | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Schedule of Available-for-sale Securities | ||
Note receivable | 2,500 | |
Total assets | 2,500 | 0 |
Contingent acquisition payment | 919 | 919 |
Total | 919 | 919 |
Money market funds (included in cash and cash equivalents) | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Schedule of Available-for-sale Securities | ||
Money market funds (included in cash and cash equivalents) | 24,454 | 28,952 |
Money market funds (included in cash and cash equivalents) | Significant Other Observable Inputs (Level 2) | ||
Schedule of Available-for-sale Securities | ||
Money market funds (included in cash and cash equivalents) | 0 | 0 |
Money market funds (included in cash and cash equivalents) | Significant Unobservable Inputs (Level 3) | ||
Schedule of Available-for-sale Securities | ||
Money market funds (included in cash and cash equivalents) | $ 0 | $ 0 |
Acquisition - Additional Inform
Acquisition - Additional Information (Details) - USD ($) | 1 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 3,120,000 | $ 3,120,000 | ||
Maximum | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration earn out payable | $ 4,000,000 | |||
Maximum | Scenario Forecast | ||||
Business Acquisition [Line Items] | ||||
Earn out cash payments | $ 2,000,000 | $ 2,000,000 | ||
Fortress ID | ||||
Business Acquisition [Line Items] | ||||
Percentage of ownership control | 100.00% | |||
Business acquisition, purchase price | $ 3,400,000 | |||
Business acquisition, cash consideration | 2,500,000 | |||
Business acquisition, earnout with fair value | 900,000 | |||
Goodwill | 1,469,000 | |||
Goodwill related to deferred tax assets | $ 300,000 |
Acquisition - Summary of Fair V
Acquisition - Summary of Fair Value of Assets Acquired and Liabilities Assumed At Date of Acquisition (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||
Goodwill | $ 3,120 | $ 3,120 |
Fortress ID | ||
Business Acquisition [Line Items] | ||
Goodwill | 1,469 | |
Gross assets acquired | 3,649 | |
Net working capital | (11) | |
Fair value of contingent consideration | (919) | |
Net assets acquired | 2,719 | |
Customer Relationships | Fortress ID | ||
Business Acquisition [Line Items] | ||
Intangible assets acquired | 1,740 | |
Developed Technology | Fortress ID | ||
Business Acquisition [Line Items] | ||
Intangible assets acquired | 430 | |
Trade Name / Trademarks | Fortress ID | ||
Business Acquisition [Line Items] | ||
Intangible assets acquired | $ 10 |
Intangible Assets - Summary of
Intangible Assets - Summary of Fair Value of Intangible Assets and Estimated Useful Lives (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Finite Lived Intangible Assets [Line Items] | |
Gross Amount | $ 3,420 |
Accumulated Amortization | 302 |
Net Book Value | 3,118 |
Customer Relationships | |
Finite Lived Intangible Assets [Line Items] | |
Gross Amount | 2,680 |
Accumulated Amortization | 205 |
Net Book Value | $ 2,475 |
Customer Relationships | Minimum | |
Finite Lived Intangible Assets [Line Items] | |
Useful Life | 8 years |
Customer Relationships | Maximum | |
Finite Lived Intangible Assets [Line Items] | |
Useful Life | 10 years |
Developed Technology | |
Finite Lived Intangible Assets [Line Items] | |
Gross Amount | $ 710 |
Accumulated Amortization | 92 |
Net Book Value | $ 618 |
Developed Technology | Minimum | |
Finite Lived Intangible Assets [Line Items] | |
Useful Life | 5 years |
Trade Name Trademarks | |
Finite Lived Intangible Assets [Line Items] | |
Gross Amount | $ 30 |
Accumulated Amortization | 5 |
Net Book Value | $ 25 |
Trade Name Trademarks | Minimum | |
Finite Lived Intangible Assets [Line Items] | |
Useful Life | 3 years |
Trade Name Trademarks | Maximum | |
Finite Lived Intangible Assets [Line Items] | |
Useful Life | 7 years |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Amortization expense of intangible assets | $ 104 | $ 44 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Finite Lived Intangible Assets Net Amortization Expense Rolling Maturity [Abstract] | |
2022 | $ 311 |
2023 | 415 |
2024 | 415 |
2025 | 412 |
2026 | 412 |
Thereafter | 1,153 |
Net Book Value | $ 3,118 |
Subscription Agreement - Additi
Subscription Agreement - Additional Information (Details) - USD ($) | Mar. 11, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 |
Schedule Of Capitalization Longterm Debt [Line Items] | ||||
Note receivable | $ 2,507,000 | $ 0 | ||
Interest income earned | 9,000 | $ 1,000 | ||
Omlis Limited | Warrant | ||||
Schedule Of Capitalization Longterm Debt [Line Items] | ||||
Warrants expire date | Sep. 11, 2023 | |||
Equity shares purchase price per shares | $ 33.91 | |||
Investment in warrant equity security | 0 | |||
Omlis Limited | Maximum | Warrant | ||||
Schedule Of Capitalization Longterm Debt [Line Items] | ||||
Issuance of warrants purchase percentage | 8.00% | |||
Note Receivable | Omlis Limited | ||||
Schedule Of Capitalization Longterm Debt [Line Items] | ||||
Convertible Note amount | $ 2,500,000 | |||
Interest rate percentage | 5.00% | |||
Maturity date | Mar. 11, 2026 | |||
Discount from effective price per share paid by investors, percentage | 20.00% | |||
Fair value of derivative | $ 0 | $ 0 | ||
Sale of note, description | Omlis granted us a right of first refusal for 18 months with respect to any proposed sale by Omlis of equity securities constituting 20% or more of the outstanding voting power of Omlis or all or substantially all of the assets of Omlis or any of its material subsidiaries. | |||
Note receivable | $ 2,500,000 | |||
Interest income earned | $ 8,000 |
Equity and Stock-based Compen_3
Equity and Stock-based Compensation - Summary of Stock-based Compensation Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | $ 430 | $ 197 |
Cost of services | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | 5 | 3 |
Research and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | 82 | 30 |
Selling and marketing | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | 96 | 33 |
General and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | $ 247 | $ 131 |
Equity and Stock-based Compen_4
Equity and Stock-based Compensation - Stock Option Grants and Unrestricted Stock Grants (Details) | Jan. 01, 2023shares | Jul. 01, 2022shares | Oct. 31, 2019shares | Sep. 30, 2019shares | Mar. 31, 2022USD ($)installmentshares | Mar. 31, 2021USD ($)installmentshares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Total stock-based compensation expense | $ 430,000 | $ 197,000 | ||||
Stock options | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of stock options granted | shares | 0 | 2,875,000 | ||||
Unrestricted Stock | 2001 Nonqualified Stock Plan | 2019 Grant | Directors | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of unrestricted stock granted | shares | 107,921 | 56,533 | ||||
Number of installment | installment | 2 | 2 | ||||
Total stock-based compensation expense | $ 400,000 | $ 300,000 | ||||
Stock-based compensation expense charged to expense | 100,000 | 30,000 | ||||
Remaining stock based compensation expense | $ 300,000 | 200,000 | ||||
Unrestricted Stock | 2001 Nonqualified Stock Plan | 2019 Grant | Directors, officers and employees | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of unrestricted stock granted | shares | 120,000 | 120,000 | 120,000 | |||
Number of installment | installment | 4 | |||||
Total stock-based compensation expense | $ 400,000 | 400,000 | ||||
Stock-based compensation expense charged to expense | 21,000 | $ 21,000 | ||||
Remaining stock based compensation expense | $ 100,000 | |||||
Unrestricted Stock | 2001 Nonqualified Stock Plan | Scenario Forecast | 2019 Grant | Directors | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of unrestricted stock granted | shares | 46,461 | 61,460 |
Equity and Stock-based Compen_5
Equity and Stock-based Compensation - Share Purchases (Details) - Share Purchases - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 01, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of common stock authorized for repurchase | $ 10 | |
Number of stock repurchased | 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Income tax benefits for net operating losses | $ 0 | $ 0 |
Estimated benefit of federal tax refund | $ 1,400,000 |
Potential Sale of Building an_2
Potential Sale of Building and Lease of Corporate Office - Additional Information (Details) | Mar. 30, 2022USD ($) | Mar. 01, 2022USD ($)ft² | Apr. 26, 2021USD ($) | Mar. 31, 2022 | Jun. 30, 2022USD ($) | Nov. 15, 2021USD ($) |
Original Agreement | FDS Bedford, LLC | ||||||
Potential Sale of Building and Lease of Corporate Office [Line Items] | ||||||
Purchase obligation | $ 8,000,000 | $ 8,900,000 | ||||
Purchase obligation, term | 180 days | |||||
Additional Amendment to Original Agreement | FDS Bedford, LLC | ||||||
Potential Sale of Building and Lease of Corporate Office [Line Items] | ||||||
Purchase obligation | $ 7,000,000 | |||||
Purchaser obligated deposit | 300,000 | |||||
Escrow deposits by purchaser | 125,000 | |||||
Additional Amendment to Original Agreement | FDS Bedford, LLC | Subsequent Event | ||||||
Potential Sale of Building and Lease of Corporate Office [Line Items] | ||||||
Brokerage commissions payable | $ 300,000 | |||||
Original Lease Agreement | ||||||
Potential Sale of Building and Lease of Corporate Office [Line Items] | ||||||
Rentable area | ft² | 20,730 | |||||
Lease, term of contract | 10 years 6 months | |||||
Rent expenses | $ 8,200,000 | |||||
Lease, renewal term | 5 years | |||||
Lease, existence of option to terminate | true | |||||
Lease, option to terminate | one-time termination right after seven years and six months | |||||
Lease, existence of option to extend | true | |||||
Lease, option to extend | a renewal option for up to two additional terms | |||||
First Amendment of Lease Agreement | ||||||
Potential Sale of Building and Lease of Corporate Office [Line Items] | ||||||
Escrow deposit | 150,000 | |||||
Retain amount from security deposit for each day | $ 1,339 |