Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2022 | Aug. 04, 2022 | |
Entity Addresses [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-38420 | |
Entity Registrant Name | VIRTRA, INC. | |
Entity Central Index Key | 0001085243 | |
Entity Tax Identification Number | 93-1207631 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 295 E. Corporate Place | |
Entity Address, City or Town | Chandler | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85225 | |
City Area Code | (480) | |
Local Phone Number | 968-1488 | |
Title of 12(b) Security | Common Stock $0.0001 par value | |
Trading Symbol | VTSI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 17,200,133 | |
Former Address [Member] | ||
Entity Addresses [Line Items] | ||
Entity Address, Address Line One | 7970 S. Kyrene Road | |
Entity Address, City or Town | Tempe | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85284 |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 15,686,234 | $ 19,708,565 |
Accounts receivable, net | 5,139,012 | 3,896,739 |
Inventory, net | 6,948,061 | 5,014,924 |
Unbilled revenue | 5,834,406 | 3,946,446 |
Prepaid expenses and other current assets | 961,278 | 940,887 |
Total current assets | 34,568,991 | 33,507,561 |
Long-term assets: | ||
Property and equipment, net | 13,474,263 | 12,864,766 |
Operating lease right-of-use asset, net | 704,453 | 784,306 |
Intangible assets, net | 566,159 | 535,079 |
Security deposits, long-term | 19,712 | 19,712 |
Other assets, long-term | 376,461 | 189,734 |
Deferred tax asset, net | 1,737,444 | 1,674,234 |
Total long-term assets | 16,878,492 | 16,067,831 |
Total assets | 51,447,483 | 49,575,392 |
Current liabilities: | ||
Accounts payable | 1,342,578 | 789,394 |
Accrued compensation and related costs | 932,797 | 1,062,078 |
Accrued expenses and other current liabilities | 1,172,589 | 991,744 |
Note payable, current | 235,144 | 236,291 |
Operating lease liability, short-term | 354,496 | 347,772 |
Deferred revenue, short-term | 4,680,653 | 4,135,565 |
Total current liabilities | 8,718,257 | 7,562,844 |
Long-term liabilities: | ||
Deferred revenue, long-term | 2,245,856 | 1,992,625 |
Note payable, long-term | 8,222,666 | 8,280,395 |
Operating lease liability, long-term | 415,260 | 505,383 |
Other long term liabilities | 5,436 | 5,436 |
Total long-term liabilities | 10,889,218 | 10,783,839 |
Total liabilities | 19,607,475 | 18,346,683 |
Commitments and contingencies (See Note 9) | ||
Stockholders’ equity: | ||
Preferred stock $0.0001 par value; 2,500,000 authorized; no shares issued or outstanding | ||
Common stock value | 1,081 | 1,081 |
Additional paid-in capital | 30,957,616 | 30,923,391 |
Retained earnings | 881,311 | 304,237 |
Total stockholders’ equity | 31,840,008 | 31,228,709 |
Total liabilities and stockholders’ equity | 51,447,483 | 49,575,392 |
Common Class A [Member] | ||
Stockholders’ equity: | ||
Common stock value | ||
Common Class B [Member] | ||
Stockholders’ equity: | ||
Common stock value |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 2,500,000 | 2,500,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 10,809,630 | 10,807,130 |
Common stock, shares outstanding | 10,809,630 | 10,807,130 |
Common Class A [Member] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 2,500,000 | 2,500,000 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
Common Class B [Member] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 7,500,000 | 7,500,000 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenues: | ||
Total revenue | $ 6,753,228 | $ 4,441,909 |
Cost of sales | 3,066,138 | 1,873,404 |
Gross profit | 3,687,090 | 2,568,505 |
Operating expenses: | ||
General and administrative | 2,296,392 | 1,710,233 |
Research and development | 679,395 | 294,217 |
Net operating expense | 2,975,787 | 2,004,450 |
Income from operations | 711,303 | 564,055 |
Other income (expense): | ||
Other income | 54,323 | 16,379 |
Other expense | (64,552) | (2,434) |
Net other income (expense) | (10,229) | 13,945 |
Income before provision for income taxes | 701,074 | 578,000 |
Provision (Benefit) for income taxes | 124,000 | (77,163) |
Net income | $ 577,074 | $ 655,163 |
Net income (loss) per common share: | ||
Basic | $ 0.05 | $ 0.08 |
Diluted | $ 0.05 | $ 0.08 |
Weighted average shares outstanding: | ||
Basic | 10,807,269 | 7,775,212 |
Diluted | 10,850,376 | 7,835,830 |
Net Sales [Member] | ||
Revenues: | ||
Total revenue | $ 6,753,228 | $ 4,441,909 |
Statements of Changes in Stockh
Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 778 | $ 13,893,660 | $ (2,235,852) | $ 11,658,586 | ||
Beginning balance, shares at Dec. 31, 2020 | 7,745,030 | |||||
Stock options exercised | 3,620 | 3,620 | ||||
Stock options exercised, shares | 2,500 | |||||
Net income | 655,163 | 655,163 | ||||
Ending balance, value at Mar. 31, 2021 | $ 778 | 13,897,280 | (1,580,689) | 12,317,369 | ||
Ending balance, shares at Mar. 31, 2021 | 7,747,530 | |||||
Beginning balance, value at Dec. 31, 2021 | $ 1,081 | 30,923,391 | 304,237 | 31,228,709 | ||
Beginning balance, shares at Dec. 31, 2021 | 10,807,130 | |||||
Stock options exercised | 7,975 | 7,975 | ||||
Stock options exercised, shares | 2,500 | |||||
Stock reserved for future services | 26,250 | 26,250 | ||||
Net income | 577,074 | 577,074 | ||||
Ending balance, value at Mar. 31, 2022 | $ 1,081 | $ 30,957,616 | $ 881,311 | $ 31,840,008 | ||
Ending balance, shares at Mar. 31, 2022 | 10,809,630 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net income | $ 577,074 | $ 655,163 | |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 215,746 | 97,290 | |
Right of use amortization | 79,853 | 76,209 | $ 310,221 |
Employee stock compensation | 26,250 | ||
Changes in operating assets and liabilities: | |||
Accounts receivable, net | (1,242,273) | (1,271,775) | |
Inventory, net | (1,933,137) | (675,480) | |
Unbilled revenue | (1,887,960) | (850,422) | |
Deferred taxes | (63,210) | ||
Prepaid expenses and other current assets | (20,391) | (321,781) | |
Other assets | (186,727) | ||
Security deposits, long-term | 66,788 | ||
Accounts payable and other accrued expenses | 603,601 | 777,457 | |
Operating lease liability | (83,399) | (77,077) | |
Deferred revenue | 798,319 | (224,800) | |
Net cash used in operating activities | (3,116,254) | (1,748,428) | |
Cash flows from investing activities: | |||
Purchase of intangible assets | (51,644) | (48,205) | |
Purchase of property and equipment | (804,433) | ||
Net cash used in investing activities | (856,077) | (48,205) | |
Cash flows from financing activities: | |||
Principal payments of debt | (57,975) | ||
Stock options exercised | 7,975 | 3,620 | |
Note payable-PPP Loan | (8,566) | ||
Net cash used in financing activities | (50,000) | (4,946) | |
Net decrease in cash and restricted cash | (4,022,331) | (1,801,579) | |
Cash and restricted cash, beginning of period | 19,708,565 | 6,841,984 | 6,841,984 |
Cash and restricted cash, end of period | 15,686,234 | 5,040,405 | $ 19,708,565 |
Supplemental disclosure of cash flow information: | |||
Income taxes paid (refunded) | 99,035 | (77,163) | |
Interest paid | 63,776 | 2,434 | |
Supplemental disclosure of non-cash investing and financing activities: | |||
Conversion of inventory to property and equipment | $ 75,976 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | Note 1. Organization and Significant Accounting Policies Organization and Business Operations VirTra, Inc. (the “Company,” “VirTra,” “we,” “us” or “our”), located in Chandler, Arizona, is a global provider of judgmental use of force training simulators, firearms training simulators and driving simulators for the law enforcement, military, educational and commercial markets. The Company’s patented technologies, software, and scenarios provide intense training for de-escalation, judgmental use-of-force, marksmanship and related training that mimics real-world situations. VirTra’s mission is to save and improve lives worldwide through practical and highly-effective virtual reality and simulator technology. The Company sells its products worldwide through a direct sales force and international distribution partners. The original business started in 1993 as Ferris Productions, Inc. In September 2001, Ferris Productions, Inc. merged with GameCom, Inc. to ultimately become VirTra, Inc., a Nevada corporation. During March 2020, a global pandemic was declared by the World Health Organization related to the rapidly growing outbreak of a novel strain of coronavirus (COVID-19). The pandemic has significantly impacted the economic conditions in the U.S., accelerating during half of March and April as federal, state and local governments react to the public health crisis, creating significant uncertainties in the U.S. economy. On March 30, 2020, the Governor for the State of Arizona issued a stay-at-home order which expired on May 15, 2020, upon which Arizona entered Phase I of reopening. The Company carefully reviewed all rules and regulations of the government orders and determined it met the requirements of an essential business to remain open. The Company had the majority of its staff begin working remotely in mid-March, with only essential personnel continue working at the manufacturing and production facilities and currently remains in Arizona’s Phase I of reopening. This situation is rapidly changing and additional impacts to the business may arise that we are not aware of currently. While the disruption is currently expected to be temporary, there is uncertainty around the duration. The ultimate impact of the pandemic on the Company’s results of operations, financial position, liquidity or capital resources cannot be reasonably estimated at this time. To date, the COVID-19 restrictions have resulted in reduced customer shipments and customer system installations. These recent developments are expected to result in lower recognized revenue and possibly lower gross margin when they occur. To date, there have been no order cancellations; rather, there have only been delays in when orders ship or installations occur and all delayed orders remain in backlog. Any future impact cannot be reasonably estimated at this time. The Company is no longer investing in Certificates of Deposits as a precautionary measure to increase its liquid cash position and preserve financial flexibility considering uncertainty in the U.S. and global markets resulting from COVID-19. Additionally, the Company’s stock repurchase program was suspended as a result of interim rulings for public-company recipients of a PPP loan under the CARES Act. The stock repurchase suspension remained in effect for the duration of the outstanding PPP loan and continues to remain in effect even though the PPP loan has been forgiven and is no longer outstanding. The Russian-Ukraine conflict is a global concern. The Company does not have any significant direct exposure to Russia or Ukraine through its operations, employee base, investments, or sanctions. We have no basis to evaluate the possible risks of this conflict. Basis of Presentation The unaudited financial statements included herein have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed with the SEC on August 2, 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading. The accompanying unaudited financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position at March 31, 2022 and the results of our operations and cash flows for the periods presented. We derived the December 31, 2021 condensed balance sheet data from audited financial statements; however, we did not include all disclosures required by GAAP. Interim results are subject to seasonal variations, and the results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts receivable, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets and intangible assets, income tax valuation allowances, and the allocation of the transaction price to the performance obligations in our contracts with customers. Revenue Recognition The Company adopted the Financial Accounting Standards Board’s (the “FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customer (Topic 606) (“ASC 606”) on January 1, 2018 and the Company elected to use the modified retrospective transition method which requires application of ASC 606 to uncompleted contracts at the date of adoption. The adoption of ASC 606 did not have a material impact on the financial statements. Under ASC 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant judgment is necessary when making these determinations. The Company’s primary sources of revenue are derived from simulator and accessories sales, training and installation, the sale of customizable software and the sale of extended service-type warranties. The Company’s policy is to typically invoice upon completion of installation and/or training, until such time the performance obligations that have been satisfied are included in unbilled. Sales discounts are presented in the financial statements as reductions in determining net revenues. Credit sales are recorded as current assets (accounts receivable and unbilled revenue). Prepaid deposits received at the time of sale and extended warranties purchased are recorded as current and long-term liabilities (deferred revenue) until earned. The following briefly summarizes the nature of our performance obligations and method of revenue recognition: Performance Obligation Method of Recognition Simulator and accessories Upon transfer of control Installation and training Upon completion or over the period of services being rendered Extended service-type warranty Deferred and recognized over the life of the extended warranty Customized software and content Upon transfer of control or over the period services are performed depending on the terms of the contract Customized content scenario As performance obligation is transferred over time (input method using time and materials expanded) Sales-based royalty exchanged for license of intellectual property Recognized as the performance obligation is satisfied over time – which is as the sales occur. The Company recognizes revenue upon transfer of control or upon completion of the services for the simulator and accessories; for the installation and training and customized software performance obligations as the customer has the right and ability to direct the use of these products and services and the customer obtains substantially all of the remaining benefit from these products and services at that time. Revenue from certain customized content contracts may be recognized over the period the services are performed based on the terms of the contract. For the sales-based royalty exchanged for license of intellectual property, the Company recognized revenue as the sales occur over time. The Company recognizes revenue on a straight-line basis over the period of services being rendered for the extended service-type warranties as these warranties represent a performance obligation to “stand ready to perform” over the duration of the warranties. As such, the warranty service is performed continuously over the warranty period. Each contract states the transaction price. The contracts do not include variable consideration, significant financing components or noncash consideration. The Company has elected to exclude sales and similar taxes from the measurement of the transaction price. The contract’s transaction price is allocated to the performance obligations based upon their stand-alone selling prices. Discounts to the stand-alone selling prices, if any, are allocated proportionately to each performance obligation. Disaggregation of Revenue Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation. Disaggregation of Revenue Schedule of Disaggregation of Revenues Three Months Ended March 31, 2022 2021 Commercial Government International Total Commercial Government International Total Simulators and accessories $ 1,580,192 $ 3,224,558 $ 906,636 $ 5,711,386 $ 273,796 $ 1,677,923 $ 1,077,185 $ 3,028,904 Extended service-type warranties 31,487 620,361 17,662 669,510 22,074 670,584 20,050 712,708 Customized software and content - 51,714 83,000 134,714 - 467,413 52,273 519,686 Installation and training 11,865 157,553 68,200 237,618 32,663 119,798 26,350 178,811 Licensing and royalities - - - - 1,800 - - 1,800 Total Revenue $ 1,623,544 $ 4,054,186 $ 1,075,498 $ 6,753,228 $ 330,333 $ 2,935,718 $ 1,175,858 $ 4,441,909 For the three months ended March 31, 2022, governmental customers comprised $ 4,054,186 60 1,623,544 24 1,075,498 16 2,935,718 66 330,333 7 1,175,858 27 Customer Deposits Customer deposits consist of prepaid deposits received for equipment purchase orders and for Subscription Training Equipment Partnership (“STEP”) operating agreements that expire annually. Customer deposits are considered a deferred liability until the completion of the customer’s contract performance obligation. When revenue is recognized, the deposit is applied to customer’s receivable balance. Customer deposits are recorded as a current liability under deferred revenue on the accompanying balance sheet and totaled $ 3,289,067 2,371,531 Warranty The Company warranties its products from manufacturing defects on a limited basis for a period of one year after purchase, but also sells separately priced extended service-type warranties for periods of up to four years after the expiration of the standard one-year warranty. During the term of the initial one-year warranty, if the device fails to operate properly from defects in materials and workmanship, the Company will fix or replace the defective product. Deferred revenue for separately priced extended warranties one year or less totaled $ 1,391,586 1,764,034 2,089,195 1,815,871 385,000 384,000 669,510 712,708 Concentration of Credit Risk and Major Customers and Suppliers Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, certificates of deposit, accounts receivable and notes receivable. The Company’s cash, cash equivalents and certificates of deposit are maintained with financial institutions with high credit standings and are FDIC insured deposits. The FDIC insures deposits according to the ownership category in which the funds are insured and how the accounts are titled. The standard deposit insurance coverage limit is $ 250,000 15,184,899 19,207,786 Most sales are to governments that are typically made on credit and the Company generally does not require collateral. Management performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for estimated losses. Historically, the Company has experienced minimal charges relative to doubtful accounts. Historically, the Company primarily sells its products to United States federal and state agencies. For the three months ended March 31, 2022, one foreign agency comprised 16 10% 22 As of March 31, 2022, one federal agency comprised 14% of total accounts receivable. By comparison, as of December 31, 2021, the Company did not have any customer that accounted for more than 10 Net Income (Loss)per Common Share The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows: Schedule of Earnings Per Share 2022 2021 Three Months Ended March 31, 2022 2021 Net income $ 577,074 $ 655,163 Weighted average common stock outstanding 10,807,269 7,775,212 Incremental shares from stock options 43,107 60,618 Weighted average common stock outstanding diluted 10,850,376 7,835,830 Net income per common share and common equivalent shares Basic $ 0.05 $ 0.08 Diluted $ 0.05 $ 0.08 The Company has potentially dilutive securities outstanding that are not included in the diluted earnings per share calculation for the three months ended March 31, 2022 and 2021 because their effect would be anti-dilutive. These potentially dilutive securities, comprised entirely of the Company’s stock options, totaled 0 |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 2. Inventory Inventory consisted of the following as of: Schedule of Inventory March 31, 2022 December 31, 2021 Raw materials and work in process $ 7,250,492 $ 5,229,636 Reserve (302,431 ) (214,712 ) Total inventory $ 6,948,061 $ 5,014,924 The Company regularly evaluates the useful life of its spare parts inventory and as a result, the Company classified $ 322,968 136,241 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 3. Property and Equipment Property and equipment consisted of the following as of: Schedule of Property and Equipment March 31, 2022 December 31, 2021 Land $ 1,778,987 $ 1,778,987 Building & Building Improvements 9,038,279 9,005,205 Computer equipment 1,176,400 1,171,319 Furniture and office equipment 262,814 262,814 Machinery and equipment 2,447,373 1,970,007 STEP equipment 1,572,228 1,496,252 Leasehold improvements 334,934 334,934 Construction in Progress 219,936 7,000 Total property and equipment 16,830,951 16,026,518 Less: Accumulated depreciation and amortization (3,356,688 ) (3,161,752 ) Property and equipment, net $ 13,474,263 $ 12,864,766 Depreciation expense, including STEP depreciation, was $ 195,031 95,068 |
Intangible Asset
Intangible Asset | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Asset | Note 4. Intangible Asset Intangible asset consisted of the following as of: Schedule of Intangible Asset March 31, 2022 December 31, 2021 Patents $ 160,000 $ 160,000 Capitalized media content 382,872 331,228 Acquired lease intangible assets 83,963 83,963 Total intangible assets 626,835 575,191 Less accumulated amortization (60,676 ) (40,112 ) Intangible assets, net $ 566,159 $ 535,079 Amortization expense was $ 20,564 2,222 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases [Abstract] | |
Leases | Note 5. Leases The balance sheet classification of lease assets and liabilities as of March 31, 2022 was as follows: Schedule of Balance Sheet Classification of Lease Assets and Liabilities Balance Sheet Classification March 31, 2022 Assets Operating lease right-of-use assets, December 31, 2021 $ 784,306 Amortization for the three months ended March 31, 2022 (79,853 ) Total operating lease right-of-use asset, March 31, 2022 $ 704,453 Liabilities Current Operating lease liability, short-term $ 354,496 Non-current Operating lease liability, long-term 415,260 Total lease liabilities $ 769,756 Future minimum lease payments as of March 31, 2022 under non-cancelable operating leases are as follows: Schedule of Future Minimum Lease Payments 2022 $ 286,412 2023 390,562 2024 131,152 Total lease payments 808,126 Less: imputed interest (38,370 ) Operating lease liability $ 769,756 The balance sheet classification of lease assets and liabilities as of December 31, 2021 was as follows: Balance Sheet Classification December 31, 2021 Assets Operating lease right-of-use assets, December 31, 2020 $ 1,094,527 Operating lease right-of-use assets, beginning $ 1,094,527 Amortization for the year ended December 31, 2021 (310,221 ) Amortization (310,221 ) Total operating lease right-of-use asset, December 31, 2021 $ 784,306 Total operating lease right-of-use asset, ending $ 784,306 Liabilities Current Operating lease liability, short-term $ 347,772 Non-current Operating lease liability, long-term 505,383 Total lease liabilities $ 853,155 Future minimum lease payments as of December 31, 2021 under non-cancelable operating leases are as follows: 2022 $ 379,097 2023 390,562 2024 131,152 Total lease payments 900,811 Less: imputed interest (47,656 ) Operating lease liability $ 853,155 Rent expense for the three months ended March 31, 2022 and 2021 was $ 209,252 143,757 |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Note 6. Accrued Expenses Accrued compensation and related costs consisted of the following as of: Schedule of Accrued Compensation and Related Costs March 31, 2022 December 31, 2021 Salaries and wages payable $ 161,972 $ 422,562 Employee benefits payable 27,991 16,523 Accrued paid time off (PTO) 528,152 483,311 Profit sharing payable 214,682 139,682 Total accrued compensation and related costs $ 932,797 $ 1,062,078 Accrued expenses and other current liabilities consisted of the following as of: Schedule of Accrued Expenses and Other Current Liabilities March 31, 2022 December 31, 2021 Manufacturer’s warranties $ 385,000 $ 384,000 Taxes payable 276,754 113,921 Miscellaneous payable 510,835 493,823 Total accrued expenses and other current liabilities $ 1,172,589 $ 991,744 |
Note Payable
Note Payable | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Note Payable | Note 7. Note Payable On August 25, 2021, the Company completed the purchase of real property located in Chandler, Arizona (the “Property”) for $ 10,800,000 8,600,000 3 40,978 5,956,538 August 23, 2031 The note payable amounts consist of the following: Schedule of Notes Payable March 31, 2022 December 31, 2021 Short-term liabilities: Note payable, principal $ 230,689 $ 231,871 Accrued interest on note 4,455 4,420 Note payable, short-term $ 235,144 $ 236,291 Long-term liabilities: Note payable, principal $ 8,222,666 $ 8,280,395 Note payable, long term $ 8,222,666 $ 8,280,395 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 8. Related Party Transactions During the three months ended March 31, 2022 and 2021, the Company redeemed 8,750 8,750 24,150 57,067 During the three months ended March 31, 2022 and 2021, the Company issued 2,500 2,500 0.0001 7,975 3,620 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9. Commitments and Contingencies General or Threatened Litigation From time to time, the Company is notified of threatened litigation or that a claim is being made against it. The Company evaluates contingencies on an on-going basis and has established loss provisions for matters in which losses are probable and the amount of loss can be reasonably estimated. There is no threatened litigation at this time. Restricted Stock Unit Grants The Company granted 224,133 168,090 2,500,000 26,250 Profit Sharing VirTra provides a discretionary profit-sharing program that pays out a percentage of Company profits each year as a cash bonus to eligible employees. The cash payment is typically split into two equal payments and distributed pro-rata in April and October of the following year to only active employees. For the three months ended March 31, 2022, the amount expensed to operations was $ 75,000 no |
Stockholders_ Equity
Stockholders’ Equity | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
Stockholders’ Equity | Note 10. Stockholders’ Equity Stock Repurchase On October 25, 2016, the Company’s Board of Directors authorized the repurchase of up to $ 1 1 Treasury Stock During the three months ended March 31, 2022, the Company purchased no additional treasury shares. Non-qualified Stock Options The Company has periodically issued non-qualified stock options to key employees, officers and directors under a stock option compensation plan approved by the Board of Directors in 2009. Terms of option grants are at the discretion of the Board of Directors and are generally seven years. Upon the exercise of these options, the Company expects to issue new authorized shares of its common stock. The following table summarizes all non-qualified stock options as of: Schedule of Non-qualified Stock Options March 31, 2022 March 31, 2021 Number of Weighted Number of Weighted Stock Options Exercise Price Stock Options Exercise Price Options outstanding, beginning of year 112,500 $ 3.51 164,167 $ 3.13 Granted - - - - Redeemed (8,750 ) 3.19 (8,750 ) 1.45 Exercised (2,500 ) 3.19 (2,500 ) 1.45 Expired / terminated - - - - Options outstanding, end of period 101,250 $ 3.55 152,917 $ 3.25 Options exercisable, end of period 101,250 $ 3.55 152,917 $ 3.25 The Company did not have any non-vested stock options outstanding as of March 31, 2022 and December 31, 2021. The weighted average contractual term for options outstanding and exercisable at March 31, 2022 and 2021 was 7 258,077 443,036 30,675 52,898 7,975 3,620 2017 Equity Incentive Plan Through March 31, 2022, 224,133 168,090 14,057 10,543 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 11. Subsequent Events On May 2, 2022, VirTra, Inc. announced the appointment of John F. Givens II as its co-Chief Executive Officer, effective April 11, 2022. Mr. Givens has been serving as a director of VirTra since November 2020. VirTra has agreed to pay Mr. Givens an initial annual base salary of $ 298,990 64,815 Mr. Givens was also granted 288,889 pursuant to VirTra’s 2017 Equity Incentive Plan. Beginning on the last business day of August 2022, a tranche of restricted stock units, having an approximate value of $40,000, based on current grant day prices, may vest if the Company has achieved net profit for the twelve months ending June 30, 2022 of at least $2,500,000. For every $500,000 earned in excess of $2,500,000 another tranche will vest. If the maximum net profit of $7,000,000 is achieved, ten tranches would vest. Similarly, on the last business day of August 2023, a tranche of restricted stock units may vest if the Company has achieved a net profit of at least $3,000,000, with the potential to have additional tranches vest up to a maximum of $9,000,000 in net profit. This vesting arrangement continues with the last business day of August 2024, with the minimum net profit threshold being $3,500,000 and the maximum net profit being $11,000,000. The vesting schedule notwithstanding, the Compensation Committee shall have the discretion to declare the vesting of any number of restricted stock units should the Company experience unusual results of operations, such as falling below the net profit threshold one year and exceeding the maximum net profit the following year, so long as the total number of restricted stock units declared to be vested does not exceed the amount awarded. Additionally, while a maximum net profit per year has been set for allocation of the available shares at this time, it is very possible that the Company will exceed these levels during the next 3 years and if such performance occurs, the Compensation Committee will meet to determine if additional compensation is in the best interests of the Company at that time. |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Organization and Business Operations | Organization and Business Operations VirTra, Inc. (the “Company,” “VirTra,” “we,” “us” or “our”), located in Chandler, Arizona, is a global provider of judgmental use of force training simulators, firearms training simulators and driving simulators for the law enforcement, military, educational and commercial markets. The Company’s patented technologies, software, and scenarios provide intense training for de-escalation, judgmental use-of-force, marksmanship and related training that mimics real-world situations. VirTra’s mission is to save and improve lives worldwide through practical and highly-effective virtual reality and simulator technology. The Company sells its products worldwide through a direct sales force and international distribution partners. The original business started in 1993 as Ferris Productions, Inc. In September 2001, Ferris Productions, Inc. merged with GameCom, Inc. to ultimately become VirTra, Inc., a Nevada corporation. During March 2020, a global pandemic was declared by the World Health Organization related to the rapidly growing outbreak of a novel strain of coronavirus (COVID-19). The pandemic has significantly impacted the economic conditions in the U.S., accelerating during half of March and April as federal, state and local governments react to the public health crisis, creating significant uncertainties in the U.S. economy. On March 30, 2020, the Governor for the State of Arizona issued a stay-at-home order which expired on May 15, 2020, upon which Arizona entered Phase I of reopening. The Company carefully reviewed all rules and regulations of the government orders and determined it met the requirements of an essential business to remain open. The Company had the majority of its staff begin working remotely in mid-March, with only essential personnel continue working at the manufacturing and production facilities and currently remains in Arizona’s Phase I of reopening. This situation is rapidly changing and additional impacts to the business may arise that we are not aware of currently. While the disruption is currently expected to be temporary, there is uncertainty around the duration. The ultimate impact of the pandemic on the Company’s results of operations, financial position, liquidity or capital resources cannot be reasonably estimated at this time. To date, the COVID-19 restrictions have resulted in reduced customer shipments and customer system installations. These recent developments are expected to result in lower recognized revenue and possibly lower gross margin when they occur. To date, there have been no order cancellations; rather, there have only been delays in when orders ship or installations occur and all delayed orders remain in backlog. Any future impact cannot be reasonably estimated at this time. The Company is no longer investing in Certificates of Deposits as a precautionary measure to increase its liquid cash position and preserve financial flexibility considering uncertainty in the U.S. and global markets resulting from COVID-19. Additionally, the Company’s stock repurchase program was suspended as a result of interim rulings for public-company recipients of a PPP loan under the CARES Act. The stock repurchase suspension remained in effect for the duration of the outstanding PPP loan and continues to remain in effect even though the PPP loan has been forgiven and is no longer outstanding. The Russian-Ukraine conflict is a global concern. The Company does not have any significant direct exposure to Russia or Ukraine through its operations, employee base, investments, or sanctions. We have no basis to evaluate the possible risks of this conflict. |
Basis of Presentation | Basis of Presentation The unaudited financial statements included herein have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed with the SEC on August 2, 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading. The accompanying unaudited financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position at March 31, 2022 and the results of our operations and cash flows for the periods presented. We derived the December 31, 2021 condensed balance sheet data from audited financial statements; however, we did not include all disclosures required by GAAP. Interim results are subject to seasonal variations, and the results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts receivable, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets and intangible assets, income tax valuation allowances, and the allocation of the transaction price to the performance obligations in our contracts with customers. |
Revenue Recognition | Revenue Recognition The Company adopted the Financial Accounting Standards Board’s (the “FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customer (Topic 606) (“ASC 606”) on January 1, 2018 and the Company elected to use the modified retrospective transition method which requires application of ASC 606 to uncompleted contracts at the date of adoption. The adoption of ASC 606 did not have a material impact on the financial statements. Under ASC 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant judgment is necessary when making these determinations. The Company’s primary sources of revenue are derived from simulator and accessories sales, training and installation, the sale of customizable software and the sale of extended service-type warranties. The Company’s policy is to typically invoice upon completion of installation and/or training, until such time the performance obligations that have been satisfied are included in unbilled. Sales discounts are presented in the financial statements as reductions in determining net revenues. Credit sales are recorded as current assets (accounts receivable and unbilled revenue). Prepaid deposits received at the time of sale and extended warranties purchased are recorded as current and long-term liabilities (deferred revenue) until earned. The following briefly summarizes the nature of our performance obligations and method of revenue recognition: Performance Obligation Method of Recognition Simulator and accessories Upon transfer of control Installation and training Upon completion or over the period of services being rendered Extended service-type warranty Deferred and recognized over the life of the extended warranty Customized software and content Upon transfer of control or over the period services are performed depending on the terms of the contract Customized content scenario As performance obligation is transferred over time (input method using time and materials expanded) Sales-based royalty exchanged for license of intellectual property Recognized as the performance obligation is satisfied over time – which is as the sales occur. The Company recognizes revenue upon transfer of control or upon completion of the services for the simulator and accessories; for the installation and training and customized software performance obligations as the customer has the right and ability to direct the use of these products and services and the customer obtains substantially all of the remaining benefit from these products and services at that time. Revenue from certain customized content contracts may be recognized over the period the services are performed based on the terms of the contract. For the sales-based royalty exchanged for license of intellectual property, the Company recognized revenue as the sales occur over time. The Company recognizes revenue on a straight-line basis over the period of services being rendered for the extended service-type warranties as these warranties represent a performance obligation to “stand ready to perform” over the duration of the warranties. As such, the warranty service is performed continuously over the warranty period. Each contract states the transaction price. The contracts do not include variable consideration, significant financing components or noncash consideration. The Company has elected to exclude sales and similar taxes from the measurement of the transaction price. The contract’s transaction price is allocated to the performance obligations based upon their stand-alone selling prices. Discounts to the stand-alone selling prices, if any, are allocated proportionately to each performance obligation. |
Disaggregation of Revenue | Disaggregation of Revenue Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation. Disaggregation of Revenue Schedule of Disaggregation of Revenues Three Months Ended March 31, 2022 2021 Commercial Government International Total Commercial Government International Total Simulators and accessories $ 1,580,192 $ 3,224,558 $ 906,636 $ 5,711,386 $ 273,796 $ 1,677,923 $ 1,077,185 $ 3,028,904 Extended service-type warranties 31,487 620,361 17,662 669,510 22,074 670,584 20,050 712,708 Customized software and content - 51,714 83,000 134,714 - 467,413 52,273 519,686 Installation and training 11,865 157,553 68,200 237,618 32,663 119,798 26,350 178,811 Licensing and royalities - - - - 1,800 - - 1,800 Total Revenue $ 1,623,544 $ 4,054,186 $ 1,075,498 $ 6,753,228 $ 330,333 $ 2,935,718 $ 1,175,858 $ 4,441,909 For the three months ended March 31, 2022, governmental customers comprised $ 4,054,186 60 1,623,544 24 1,075,498 16 2,935,718 66 330,333 7 1,175,858 27 |
Customer Deposits | Customer Deposits Customer deposits consist of prepaid deposits received for equipment purchase orders and for Subscription Training Equipment Partnership (“STEP”) operating agreements that expire annually. Customer deposits are considered a deferred liability until the completion of the customer’s contract performance obligation. When revenue is recognized, the deposit is applied to customer’s receivable balance. Customer deposits are recorded as a current liability under deferred revenue on the accompanying balance sheet and totaled $ 3,289,067 2,371,531 |
Warranty | Warranty The Company warranties its products from manufacturing defects on a limited basis for a period of one year after purchase, but also sells separately priced extended service-type warranties for periods of up to four years after the expiration of the standard one-year warranty. During the term of the initial one-year warranty, if the device fails to operate properly from defects in materials and workmanship, the Company will fix or replace the defective product. Deferred revenue for separately priced extended warranties one year or less totaled $ 1,391,586 1,764,034 2,089,195 1,815,871 385,000 384,000 669,510 712,708 |
Concentration of Credit Risk and Major Customers and Suppliers | Concentration of Credit Risk and Major Customers and Suppliers Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, certificates of deposit, accounts receivable and notes receivable. The Company’s cash, cash equivalents and certificates of deposit are maintained with financial institutions with high credit standings and are FDIC insured deposits. The FDIC insures deposits according to the ownership category in which the funds are insured and how the accounts are titled. The standard deposit insurance coverage limit is $ 250,000 15,184,899 19,207,786 Most sales are to governments that are typically made on credit and the Company generally does not require collateral. Management performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for estimated losses. Historically, the Company has experienced minimal charges relative to doubtful accounts. Historically, the Company primarily sells its products to United States federal and state agencies. For the three months ended March 31, 2022, one foreign agency comprised 16 10% 22 As of March 31, 2022, one federal agency comprised 14% of total accounts receivable. By comparison, as of December 31, 2021, the Company did not have any customer that accounted for more than 10 |
Net Income (Loss)per Common Share | Net Income (Loss)per Common Share The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows: Schedule of Earnings Per Share 2022 2021 Three Months Ended March 31, 2022 2021 Net income $ 577,074 $ 655,163 Weighted average common stock outstanding 10,807,269 7,775,212 Incremental shares from stock options 43,107 60,618 Weighted average common stock outstanding diluted 10,850,376 7,835,830 Net income per common share and common equivalent shares Basic $ 0.05 $ 0.08 Diluted $ 0.05 $ 0.08 The Company has potentially dilutive securities outstanding that are not included in the diluted earnings per share calculation for the three months ended March 31, 2022 and 2021 because their effect would be anti-dilutive. These potentially dilutive securities, comprised entirely of the Company’s stock options, totaled 0 |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Disaggregation of Revenues | Under ASC 606, disaggregated revenue from contracts with customers depicts the nature, amount, timing, and uncertainty of revenue and cash flows affected by economic factors. The Company has evaluated revenues recognized and the following table illustrates the disaggregation disclosure by customer’s location and performance obligation. Disaggregation of Revenue Schedule of Disaggregation of Revenues Three Months Ended March 31, 2022 2021 Commercial Government International Total Commercial Government International Total Simulators and accessories $ 1,580,192 $ 3,224,558 $ 906,636 $ 5,711,386 $ 273,796 $ 1,677,923 $ 1,077,185 $ 3,028,904 Extended service-type warranties 31,487 620,361 17,662 669,510 22,074 670,584 20,050 712,708 Customized software and content - 51,714 83,000 134,714 - 467,413 52,273 519,686 Installation and training 11,865 157,553 68,200 237,618 32,663 119,798 26,350 178,811 Licensing and royalities - - - - 1,800 - - 1,800 Total Revenue $ 1,623,544 $ 4,054,186 $ 1,075,498 $ 6,753,228 $ 330,333 $ 2,935,718 $ 1,175,858 $ 4,441,909 |
Schedule of Earnings Per Share | The net income per common share is computed by dividing net income by the weighted average of common shares outstanding. Diluted net income per share reflects the potential dilution, using the treasury stock method, that would occur if outstanding stock options and warrants were exercised. Earnings per share computations are as follows: Schedule of Earnings Per Share 2022 2021 Three Months Ended March 31, 2022 2021 Net income $ 577,074 $ 655,163 Weighted average common stock outstanding 10,807,269 7,775,212 Incremental shares from stock options 43,107 60,618 Weighted average common stock outstanding diluted 10,850,376 7,835,830 Net income per common share and common equivalent shares Basic $ 0.05 $ 0.08 Diluted $ 0.05 $ 0.08 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consisted of the following as of: Schedule of Inventory March 31, 2022 December 31, 2021 Raw materials and work in process $ 7,250,492 $ 5,229,636 Reserve (302,431 ) (214,712 ) Total inventory $ 6,948,061 $ 5,014,924 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following as of: Schedule of Property and Equipment March 31, 2022 December 31, 2021 Land $ 1,778,987 $ 1,778,987 Building & Building Improvements 9,038,279 9,005,205 Computer equipment 1,176,400 1,171,319 Furniture and office equipment 262,814 262,814 Machinery and equipment 2,447,373 1,970,007 STEP equipment 1,572,228 1,496,252 Leasehold improvements 334,934 334,934 Construction in Progress 219,936 7,000 Total property and equipment 16,830,951 16,026,518 Less: Accumulated depreciation and amortization (3,356,688 ) (3,161,752 ) Property and equipment, net $ 13,474,263 $ 12,864,766 |
Intangible Asset (Tables)
Intangible Asset (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Asset | Intangible asset consisted of the following as of: Schedule of Intangible Asset March 31, 2022 December 31, 2021 Patents $ 160,000 $ 160,000 Capitalized media content 382,872 331,228 Acquired lease intangible assets 83,963 83,963 Total intangible assets 626,835 575,191 Less accumulated amortization (60,676 ) (40,112 ) Intangible assets, net $ 566,159 $ 535,079 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases [Abstract] | |
Schedule of Balance Sheet Classification of Lease Assets and Liabilities | The balance sheet classification of lease assets and liabilities as of March 31, 2022 was as follows: Schedule of Balance Sheet Classification of Lease Assets and Liabilities Balance Sheet Classification March 31, 2022 Assets Operating lease right-of-use assets, December 31, 2021 $ 784,306 Amortization for the three months ended March 31, 2022 (79,853 ) Total operating lease right-of-use asset, March 31, 2022 $ 704,453 Liabilities Current Operating lease liability, short-term $ 354,496 Non-current Operating lease liability, long-term 415,260 Total lease liabilities $ 769,756 The balance sheet classification of lease assets and liabilities as of December 31, 2021 was as follows: Balance Sheet Classification December 31, 2021 Assets Operating lease right-of-use assets, December 31, 2020 $ 1,094,527 Operating lease right-of-use assets, beginning $ 1,094,527 Amortization for the year ended December 31, 2021 (310,221 ) Amortization (310,221 ) Total operating lease right-of-use asset, December 31, 2021 $ 784,306 Total operating lease right-of-use asset, ending $ 784,306 Liabilities Current Operating lease liability, short-term $ 347,772 Non-current Operating lease liability, long-term 505,383 Total lease liabilities $ 853,155 |
Schedule of Future Minimum Lease Payments | Future minimum lease payments as of March 31, 2022 under non-cancelable operating leases are as follows: Schedule of Future Minimum Lease Payments 2022 $ 286,412 2023 390,562 2024 131,152 Total lease payments 808,126 Less: imputed interest (38,370 ) Operating lease liability $ 769,756 Future minimum lease payments as of December 31, 2021 under non-cancelable operating leases are as follows: 2022 $ 379,097 2023 390,562 2024 131,152 Total lease payments 900,811 Less: imputed interest (47,656 ) Operating lease liability $ 853,155 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Compensation and Related Costs | Accrued compensation and related costs consisted of the following as of: Schedule of Accrued Compensation and Related Costs March 31, 2022 December 31, 2021 Salaries and wages payable $ 161,972 $ 422,562 Employee benefits payable 27,991 16,523 Accrued paid time off (PTO) 528,152 483,311 Profit sharing payable 214,682 139,682 Total accrued compensation and related costs $ 932,797 $ 1,062,078 |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following as of: Schedule of Accrued Expenses and Other Current Liabilities March 31, 2022 December 31, 2021 Manufacturer’s warranties $ 385,000 $ 384,000 Taxes payable 276,754 113,921 Miscellaneous payable 510,835 493,823 Total accrued expenses and other current liabilities $ 1,172,589 $ 991,744 |
Note Payable (Tables)
Note Payable (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | The note payable amounts consist of the following: Schedule of Notes Payable March 31, 2022 December 31, 2021 Short-term liabilities: Note payable, principal $ 230,689 $ 231,871 Accrued interest on note 4,455 4,420 Note payable, short-term $ 235,144 $ 236,291 Long-term liabilities: Note payable, principal $ 8,222,666 $ 8,280,395 Note payable, long term $ 8,222,666 $ 8,280,395 |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
Schedule of Non-qualified Stock Options | Schedule of Non-qualified Stock Options March 31, 2022 March 31, 2021 Number of Weighted Number of Weighted Stock Options Exercise Price Stock Options Exercise Price Options outstanding, beginning of year 112,500 $ 3.51 164,167 $ 3.13 Granted - - - - Redeemed (8,750 ) 3.19 (8,750 ) 1.45 Exercised (2,500 ) 3.19 (2,500 ) 1.45 Expired / terminated - - - - Options outstanding, end of period 101,250 $ 3.55 152,917 $ 3.25 Options exercisable, end of period 101,250 $ 3.55 152,917 $ 3.25 |
Schedule of Disaggregation of R
Schedule of Disaggregation of Revenues (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Simulators and accessories | $ 5,711,386 | $ 3,028,904 |
Extended service-type warranties | 669,510 | 712,708 |
Customized software and content | 134,714 | 519,686 |
Installation and training | 237,618 | 178,811 |
Licensing and royalties | 1,800 | |
Total Revenue | 6,753,228 | 4,441,909 |
Commercial [Member] | ||
Simulators and accessories | 1,580,192 | 273,796 |
Extended service-type warranties | 31,487 | 22,074 |
Customized software and content | ||
Installation and training | 11,865 | 32,663 |
Licensing and royalties | 1,800 | |
Total Revenue | 1,623,544 | 330,333 |
Government [Member] | ||
Simulators and accessories | 3,224,558 | 1,677,923 |
Extended service-type warranties | 620,361 | 670,584 |
Customized software and content | 51,714 | 467,413 |
Installation and training | 157,553 | 119,798 |
Licensing and royalties | ||
Total Revenue | 4,054,186 | 2,935,718 |
Geographic Distribution, Foreign [Member] | ||
Simulators and accessories | 906,636 | 1,077,185 |
Extended service-type warranties | 17,662 | 20,050 |
Customized software and content | 83,000 | 52,273 |
Installation and training | 68,200 | 26,350 |
Licensing and royalties | ||
Total Revenue | $ 1,075,498 | $ 1,175,858 |
Schedule of Earnings Per Share
Schedule of Earnings Per Share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accounting Policies [Abstract] | ||
Net income | $ 577,074 | $ 655,163 |
Weighted average common stock outstanding | 10,807,269 | 7,775,212 |
Incremental shares from stock options | 43,107 | 60,618 |
Weighted average common stock outstanding diluted | 10,850,376 | 7,835,830 |
Basic | $ 0.05 | $ 0.08 |
Diluted | $ 0.05 | $ 0.08 |
Organization and Significant _4
Organization and Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Product Information [Line Items] | |||
Revenue | $ 6,753,228 | $ 4,441,909 | |
Customer deposits, current | 4,680,653 | $ 4,135,565 | |
Revenue recognized | 669,510 | $ 712,708 | |
FDIC insured amount | 250,000 | ||
Uninsured cash and cash equivalents | $ 15,184,899 | 19,207,786 | |
Anti-dilutive securities excluded from computation of earnings per share | 0 | 0 | |
Warranty [Member] | One Year or Less [Member] | |||
Product Information [Line Items] | |||
Extended warranties | $ 1,391,586 | 1,764,034 | |
Warranty [Member] | Longer Than One Year [Member] | |||
Product Information [Line Items] | |||
Extended warranties | 2,089,195 | 1,815,871 | |
Warranty [Member] | One Year [Member] | |||
Product Information [Line Items] | |||
Extended warranties | 385,000 | 384,000 | |
Deferred Revenue [Member] | |||
Product Information [Line Items] | |||
Customer deposits, current | 3,289,067 | $ 2,371,531 | |
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Government Customers [Member] | |||
Product Information [Line Items] | |||
Revenue | $ 4,054,186 | $ 2,935,718 | |
Concentration of credit risk | 60% | 66% | |
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Commercial Customers [Member] | |||
Product Information [Line Items] | |||
Revenue | $ 1,623,544 | $ 330,333 | |
Concentration of credit risk | 24% | 7% | |
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | International Customers [Member] | |||
Product Information [Line Items] | |||
Revenue | $ 1,075,498 | $ 1,175,858 | |
Concentration of credit risk | 16% | 27% | |
Revenue from Contract with Customer, Product and Service Benchmark [Member] | Customer Concentration Risk [Member] | One Commercial Customer [Member] | |||
Product Information [Line Items] | |||
Concentration of credit risk | 16% | ||
Revenue from Contract with Customer, Product and Service Benchmark [Member] | Customer Concentration Risk [Member] | One Federal Agency [Member] | |||
Product Information [Line Items] | |||
Concentration of credit risk | 10% | ||
Revenue from Contract with Customer, Product and Service Benchmark [Member] | Customer Concentration Risk [Member] | One Foreign Agency [Member] | |||
Product Information [Line Items] | |||
Concentration of credit risk | 22% | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | One State Agency [Member] | |||
Product Information [Line Items] | |||
Concentration of credit risk | 10% |
Schedule of Inventory (Details)
Schedule of Inventory (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials and work in process | $ 7,250,492 | $ 5,229,636 |
Reserve | (302,431) | (214,712) |
Total inventory | $ 6,948,061 | $ 5,014,924 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Other assets, long-term | $ 376,461 | $ 189,734 |
Spare Parts [Member] | ||
Other assets, long-term | $ 322,968 | $ 136,241 |
Schedule of Property and Equipm
Schedule of Property and Equipment (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 16,830,951 | $ 16,026,518 |
Less: Accumulated depreciation and amortization | (3,356,688) | (3,161,752) |
Property and equipment, net | 13,474,263 | 12,864,766 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,778,987 | 1,778,987 |
Building and Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 9,038,279 | 9,005,205 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,176,400 | 1,171,319 |
Furniture and Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 262,814 | 262,814 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 2,447,373 | 1,970,007 |
STEP Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,572,228 | 1,496,252 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 334,934 | 334,934 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 219,936 | $ 7,000 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 195,031 | $ 95,068 |
Schedule of Intangible Asset (D
Schedule of Intangible Asset (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 626,835 | $ 575,191 |
Less accumulated amortization | (60,676) | (40,112) |
Intangible assets, net | 566,159 | 535,079 |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 160,000 | 160,000 |
Capitalized Media Content [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 382,872 | 331,228 |
Acquired Lease Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 83,963 | $ 83,963 |
Intangible Asset (Details Narra
Intangible Asset (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible asset | $ 20,564 | $ 2,222 |
Schedule of Balance Sheet Class
Schedule of Balance Sheet Classification of Lease Assets and Liabilities (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating lease right-of-use assets, beginning | $ 784,306 | $ 1,094,527 | $ 1,094,527 |
Amortization | (79,853) | $ (76,209) | (310,221) |
Total operating lease right-of-use asset, ending | 704,453 | 784,306 | |
Operating lease liability, short-term | 354,496 | 347,772 | |
Operating lease liability, long-term | 415,260 | 505,383 | |
Total lease liabilities | $ 769,756 | $ 853,155 |
Schedule of Future Minimum Leas
Schedule of Future Minimum Lease Payments (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2022 | $ 286,412 | $ 379,097 |
2023 | 390,562 | 390,562 |
2024 | 131,152 | 131,152 |
Total lease payments | 808,126 | 900,811 |
Less: imputed interest | (38,370) | (47,656) |
Operating lease liability | $ 769,756 | $ 853,155 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Leases [Abstract] | ||
Rent expenses | $ 209,252 | $ 143,757 |
Schedule of Accrued Compensatio
Schedule of Accrued Compensation and Related Costs (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Salaries and wages payable | $ 161,972 | $ 422,562 |
Employee benefits payable | 27,991 | 16,523 |
Accrued paid time off (PTO) | 528,152 | 483,311 |
Profit sharing payable | 214,682 | 139,682 |
Total accrued compensation and related costs | $ 932,797 | $ 1,062,078 |
Schedule of Accrued Expenses an
Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Manufacturer’s warranties | $ 385,000 | $ 384,000 |
Taxes payable | 276,754 | 113,921 |
Miscellaneous payable | 510,835 | 493,823 |
Total accrued expenses and other current liabilities | $ 1,172,589 | $ 991,744 |
Schedule of Notes Payable (Deta
Schedule of Notes Payable (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Short-Term Debt [Line Items] | ||
Note payable, short-term | $ 235,144 | $ 236,291 |
Note payable, long term | 8,222,666 | 8,280,395 |
Notes Payable [Member] | ||
Short-Term Debt [Line Items] | ||
Note payable, principal | 8,222,666 | 8,280,395 |
Note payable, long term | 8,222,666 | 8,280,395 |
Notes Payable [Member] | ||
Short-Term Debt [Line Items] | ||
Note payable, principal | 230,689 | 231,871 |
Accrued interest on note | 4,455 | 4,420 |
Note payable, short-term | $ 235,144 | $ 236,291 |
Note Payable (Details Narrative
Note Payable (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Aug. 25, 2021 | Mar. 31, 2022 | Mar. 31, 2021 | |
Short-Term Debt [Line Items] | |||
Payment to acquire assets | $ 804,433 | ||
Arizona Bank and Trust [Member] | |||
Short-Term Debt [Line Items] | |||
Proceeds from bank loan | $ 8,600,000 | ||
Debt instrument interest rate | 3% | ||
Maturity date | Aug. 23, 2031 | ||
Arizona Bank and Trust [Member] | 199 Regular Monthly Payments [Member] | |||
Short-Term Debt [Line Items] | |||
Debt instrument periodic payment | $ 40,978 | ||
Arizona Bank and Trust [Member] | One Irregular Payment [Member] | |||
Short-Term Debt [Line Items] | |||
Debt instrument periodic payment | 5,956,538 | ||
Property [Member] | |||
Short-Term Debt [Line Items] | |||
Payment to acquire assets | $ 10,800,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | |||
Compensation expenses | $ 24,150 | $ 57,067 | |
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common Stock [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | |||
Stock issued during the period, new issues | 2,500 | 2,500 | |
Common stock, par value | $ 0.0001 | ||
Stock option exercised | 2,500 | 2,500 | |
Chief Executive Officer and Chief Operating Officer [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | |||
Stock reedemed or called during period shares | 8,750 | 8,750 | |
One Member Of The Board Of Directors [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | |||
Stock option exercised | 7,975 | 3,620 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Aug. 31, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Net income loss | $ 577,074 | $ 655,163 | |
Operating expenses | 2,975,787 | 2,004,450 | |
Deferred Profit Sharing [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Operating expenses | 75,000 | ||
Restricted Stock Units (RSUs) [Member] | Tranche [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Net income loss | $ 26,250 | ||
Restricted Stock Units (RSUs) [Member] | Tranche [Member] | June 30, 2022 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Net income loss | $ 2,500,000 | ||
Chief Executive Officer [Member] | Restricted Stock Units (RSUs) [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock issued during period shares restricted stock, shares | 224,133 | ||
Chief Operating Officer [Member] | Restricted Stock Units (RSUs) [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock issued during period shares restricted stock, shares | 168,090 |
Schedule of Non-qualified Stock
Schedule of Non-qualified Stock Options (Details) - Non Qualified Stock Option [Member] - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Offsetting Assets [Line Items] | ||
Number of Stock Options, Options outstanding, beginning of year | 112,500 | 164,167 |
Weighted Exercise Price, Option outstanding, beginning of year | $ 3.51 | $ 3.13 |
Number of Stock Options, Granted | ||
Weighted Exercise Price, Granted | ||
Number of Stock Options, Redeemed | (8,750) | (8,750) |
Weighted Exercise Price, Redeemed | $ 3.19 | $ 1.45 |
Number of Stock Options, Exercised | (2,500) | (2,500) |
Weighted Exercise Price, Exercised | $ 3.19 | $ 1.45 |
Number of Stock Options, Expired / terminated | ||
Weighted Exercise Price, Expired / terminated | ||
Number of Stock Options, Options outstanding, end of period | 101,250 | 152,917 |
Weighted Exercise Price, Option outstanding end of period | $ 3.55 | $ 3.25 |
Number of Stock Options, Options exercisable, end of period | 101,250 | 152,917 |
Weighted Exercise Price, Options exercisable, end of period | $ 3.55 | $ 3.25 |
Stockholders_ Equity (Details N
Stockholders’ Equity (Details Narrative) - USD ($) | 3 Months Ended | |||
Jan. 09, 2019 | Oct. 25, 2016 | Mar. 31, 2022 | Mar. 31, 2021 | |
Class of Stock [Line Items] | ||||
Options outstanding weighted average contractual term | 7 years | 7 years | ||
Options exercisable weighted average contractual term | 7 years | 7 years | ||
Exercisable and outstanding Intriinsic value | $ 258,077 | $ 443,036 | ||
Intriinsic value | 30,675 | 52,898 | ||
Proceeds from stock options exrercised | $ 7,975 | $ 3,620 | ||
2017 Equity Incentive Plan [Member] | Chief Executive Officer [Member] | ||||
Class of Stock [Line Items] | ||||
Stock issued during period shares based compensation, shares | 224,133 | |||
Stock issued during period shares restricted stock, shares | 14,057 | |||
2017 Equity Incentive Plan [Member] | Chief Operating Officer [Member] | ||||
Class of Stock [Line Items] | ||||
Stock issued during period shares based compensation, shares | 168,090 | |||
Stock issued during period shares restricted stock, shares | 10,543 | |||
Common Stock [Member] | Maximum [Member] | ||||
Class of Stock [Line Items] | ||||
Stock repurchased during period, value | $ 1,000,000 | $ 1,000,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - Mr.Givens [Member] - USD ($) | Aug. 31, 2022 | May 02, 2022 |
Subsequent Event [Line Items] | ||
Salaries wages and officers compensation | $ 298,990 | |
Stock issued during period for signing bonus, shares | 64,815 | |
2017 Equity Incentive Plan [Member] | ||
Subsequent Event [Line Items] | ||
Stock issued during period shares restricted stock, shares | 288,889 | |
Restricted stock units vesting, description | Beginning on the last business day of August 2022, a tranche of restricted stock units, having an approximate value of $40,000, based on current grant day prices, may vest if the Company has achieved net profit for the twelve months ending June 30, 2022 of at least $2,500,000. For every $500,000 earned in excess of $2,500,000 another tranche will vest. If the maximum net profit of $7,000,000 is achieved, ten tranches would vest. Similarly, on the last business day of August 2023, a tranche of restricted stock units may vest if the Company has achieved a net profit of at least $3,000,000, with the potential to have additional tranches vest up to a maximum of $9,000,000 in net profit. This vesting arrangement continues with the last business day of August 2024, with the minimum net profit threshold being $3,500,000 and the maximum net profit being $11,000,000. |