Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | May 08, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2023 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2023 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-34643 | |
Entity Registrant Name | AYRO, INC. | |
Entity Central Index Key | 0001086745 | |
Entity Tax Identification Number | 98-0204758 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 900 E. Old Settlers Boulevard | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | Round Rock | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78664 | |
City Area Code | (512) | |
Local Phone Number | 994-4917 | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | AYRO | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,536,101 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash | $ 31,990,835 | $ 39,096,562 |
Marketable securities | 9,755,228 | 9,848,804 |
Accounts receivable, net | 107,741 | 510,071 |
Inventory | 1,521,662 | 970,381 |
Prepaid expenses and other current assets | 2,151,666 | 1,478,845 |
Total current assets | 45,527,132 | 51,904,663 |
Property and equipment, net | 2,910,236 | 2,192,337 |
Operating lease – right-of-use asset | 792,159 | 819,401 |
Deposits and other assets | 78,392 | 73,683 |
Total assets | 49,307,919 | 54,990,084 |
Current liabilities: | ||
Accounts payable | 746,383 | 1,107,215 |
Accrued expenses | 891,655 | 964,937 |
Current portion lease obligation – operating lease | 171,794 | 165,767 |
Total current liabilities | 1,809,832 | 2,237,919 |
Lease obligation - operating lease, net of current portion | 648,726 | 693,776 |
Total liabilities | 2,458,558 | 2,931,695 |
Stockholders’ equity: | ||
Preferred stock, value | ||
Common Stock, ($0.0001 par value; authorized – 100,000,000 shares; issued and outstanding – 37,352,204 and 37,241,642 as of March 31, 2023, and December 31, 2022, respectively) | 3,735 | 3,724 |
Additional paid-in capital | 133,490,979 | 133,224,249 |
Accumulated deficit | (86,645,353) | (81,169,584) |
Total stockholders’ equity | 46,849,361 | 52,058,389 |
Total liabilities and stockholders’ equity | 49,307,919 | 54,990,084 |
Convertible Preferred Stock Series H [Member] | ||
Stockholders’ equity: | ||
Preferred stock, value | ||
Convertible Preferred Stock Series H-3 [Member] | ||
Stockholders’ equity: | ||
Preferred stock, value | ||
Convertible Preferred Stock Series H-6 [Member] | ||
Stockholders’ equity: | ||
Preferred stock, value |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 37,352,204 | 37,241,642 |
Common stock, shares outstanding | 37,352,204 | 37,241,642 |
Convertible Preferred Stock Series H [Member] | ||
Preferred stock, shares authorized | 8,500 | 8,500 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 8 | 8 |
Preferred stock, shares outstanding | 8 | 8 |
Convertible Preferred Stock Series H-3 [Member] | ||
Preferred stock, shares authorized | 8,461 | 8,461 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 1,234 | 1,234 |
Preferred stock, shares outstanding | 1,234 | 1,234 |
Convertible Preferred Stock Series H-6 [Member] | ||
Preferred stock, shares authorized | 50,000 | 50,000 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 50 | 50 |
Preferred stock, shares outstanding | 50 | 50 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Revenue | $ 113,084 | $ 1,026,846 |
Cost of goods sold | 219,792 | 1,177,145 |
Gross loss | (106,708) | (150,299) |
Operating expenses: | ||
Research and development | 2,129,990 | 872,631 |
Sales and marketing | 718,092 | 844,816 |
General and administrative | 2,843,317 | 2,697,704 |
Total operating expenses | 5,691,399 | 4,415,151 |
Loss from operations | (5,798,107) | (4,565,450) |
Other income (expense): | ||
Other income, net | 61,698 | |
Interest income | 144,360 | 8,891 |
Unrealized gain (loss) on marketable securities | 51,280 | (22,101) |
Realized gain on marketable securities | 65,000 | |
Other income (expense), net | 322,338 | (13,210) |
Net loss | $ (5,475,769) | $ (4,578,660) |
Net loss per share, basic and diluted | $ (0.15) | $ (0.12) |
Basic and diluted weighted average Common Stock outstanding | 37,319,905 | 36,907,155 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Series H Preferred Stock [Member] Preferred Stock [Member] | Series H-3 Preferred Stock [Member] Preferred Stock [Member] | Series H-6 Preferred Stock [Member] Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Balance at Dec. 31, 2021 | $ 3,687 | $ 131,654,776 | $ (58,234,231) | $ 73,424,232 | |||
Balance, shares at Dec. 31, 2021 | 8 | 1,234 | 50 | 36,866,956 | |||
Stock Based Compensation | 288,110 | 288,110 | |||||
Vesting of Restricted Stock | $ 4 | 329,377 | 329,381 | ||||
Vesting of Restricted Stock , shares | 43,000 | ||||||
Net Loss | (4,578,660) | (4,578,660) | |||||
Balance at Mar. 31, 2022 | $ 3,691 | 132,272,263 | (62,812,891) | 69,463,063 | |||
Balance, shares at Mar. 31, 2022 | 8 | 1,234 | 50 | 36,909,956 | |||
Balance at Dec. 31, 2022 | $ 3,724 | 133,224,249 | (81,169,584) | 52,058,389 | |||
Balance, shares at Dec. 31, 2022 | 8 | 1,234 | 50 | 37,241,642 | |||
Stock Based Compensation | 20,116 | 20,116 | |||||
Vesting of Restricted Stock | $ 11 | 246,614 | 246,625 | ||||
Vesting of Restricted Stock , shares | 110,562 | ||||||
Net Loss | (5,475,769) | (5,475,769) | |||||
Balance at Mar. 31, 2023 | $ 3,735 | $ 133,490,979 | $ (86,645,353) | $ 46,849,361 | |||
Balance, shares at Mar. 31, 2023 | 8 | 1,234 | 50 | 37,352,204 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (5,475,769) | $ (4,578,660) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 194,302 | 121,425 |
Stock-based compensation | 266,741 | 288,110 |
Amortization of right-of-use asset | 40,242 | 58,651 |
Bad debt expense | 292,010 | 11,657 |
Unrealized (gain) loss on marketable securities | (51,280) | 22,101 |
Realized gain on marketable securities | (65,000) | |
Change in operating assets and liabilities: | ||
Accounts receivable | 110,320 | (246,050) |
Inventory | (551,281) | (137,258) |
Prepaid expenses and other assets | (672,823) | (312,992) |
Accounts payable | (375,832) | (30,899) |
Accrued expenses | (195,761) | (676,083) |
Lease obligations - operating leases | (52,023) | (65,115) |
Net cash used in operating activities | (6,536,154) | (5,545,113) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (771,226) | (113,637) |
Change in marketable securities | 209,856 | (20,000,000) |
Purchase of intangible assets | (8,203) | (7,000) |
Net cash used in investing activities | (569,573) | (20,120,637) |
Net change in cash | (7,105,727) | (25,665,750) |
Cash, beginning of period | 39,096,562 | 69,160,466 |
Cash, end of period | 31,990,835 | 43,494,716 |
Supplemental disclosure of cash and non-cash transactions: | ||
Restricted Stock issued, previously accrued | 329,381 | |
Supplemental cash amounts arising from obtaining right of use assets | 13,000 | |
Accrued Fixed Assets | $ 137,481 |
ORGANIZATION AND NATURE OF OPER
ORGANIZATION AND NATURE OF OPERATIONS | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF OPERATIONS | NOTE 1. ORGANIZATION AND NATURE OF OPERATIONS AYRO, Inc. (“AYRO” or the “Company”), a Delaware corporation formerly known as DropCar, Inc. (“DropCar”), a corporation headquartered outside Austin, Texas, is the merger successor discussed below of AYRO Operating Company, Inc. (“AYRO Operating”), which was formed under the laws of the State of Texas on May 17, 2016 as Austin PRT Vehicle, Inc. and subsequently changed its name to Austin EV, Inc. under an Amended and Restated Certificate of Formation filed with the State of Texas on March 9, 2017. On July 24, 2019, the Company changed its name to AYRO, Inc. and converted its corporate domicile to Delaware. The Company was founded on the basis of promoting resource sustainability. The Company, and its wholly owned subsidiaries, are principally engaged in manufacturing and sales of environmentally conscious, minimal-footprint electric vehicles. The all-electric vehicles are typically sold both directly to customers and to dealers in the United States. Strategic Review Following the hiring of the Company’s current Chief Executive Officer in the third quarter of 2021, AYRO initiated a strategic review of its product development strategy, as AYRO focused on creating value within the electric vehicle, last-mile delivery, smart payload and enabling infrastructure markets. In connection with the strategic review by the Company, AYRO cancelled development of its planned next-generation three-wheeled high-speed vehicle. For the past several years, AYRO’s primary supplier has been Cenntro Automotive Group, Ltd. (“Cenntro”), which operates a large electric vehicle factory in the automotive district in Hangzhou, China. As a result of rising shipping costs, quality issues with certain components and persistent delays, the Company ceased production of the AYRO 411x from Cenntro in September 2022 in order to focus its resources on the development and launch of the new 411 fleet vehicle model year 2023 refresh (the “Vanish”). In December of 2021 the Company began research and development on the Vanish, including updates on its supply chain evolution, offshoring/onshoring mix, manufacturing strategy, and annual model year refresh program. |
LIQUIDITY AND OTHER UNCERTAINTI
LIQUIDITY AND OTHER UNCERTAINTIES | 3 Months Ended |
Mar. 31, 2023 | |
Liquidity And Other Uncertainties | |
LIQUIDITY AND OTHER UNCERTAINTIES | NOTE 2. LIQUIDITY AND OTHER UNCERTAINTIES Liquidity and Other Uncertainties The unaudited condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“GAAP”), which contemplates continuation of the Company as a going concern. The Company is subject to a number of risks similar to those of earlier stage commercial companies, including dependence on key individuals and products, the difficulties inherent in the development of a commercial market, the potential need to obtain additional capital, competition from larger companies, other technology companies and other technologies. The Company has a limited operating history and the sales and income potential of its business and market are unproven. The Company incurred net losses of $ 5,475,769 6,536,154 31,990,835 9,755,228 5,949,444 The Company may experience increases in the cost or a sustained interruption in the supply or shortage of raw materials, including lithium-ion battery cells, semiconductors, and integrated circuits. Any such increase or supply interruption could materially and negatively impact the business, prospects, financial condition, and operating results. Currently, the Company is experiencing supply chain shortages, including with respect to lithium-ion battery cells, integrated circuits, vehicle control chips, and displays. Certain production-ready components may be delayed in shipment to Company facilities which has and may continue to cause delays in validation and testing for these components, which would in turn create a delay in the availability of saleable vehicles. The Company uses various raw materials, including aluminum, steel, carbon fiber, non-ferrous metals (such as copper), and cobalt. The prices for these raw materials fluctuate depending on market conditions, and global demand and could adversely affect business and operating results. For instance, the Company is exposed to multiple risks relating to price fluctuations for lithium-ion cells. These risks include: ● the inability or unwillingness of current battery manufacturers to build or operate battery cell manufacturing plants to supply the numbers of lithium-ion cells required to support the growth of the electric vehicle industry as demand for such cells increases; ● disruption in the supply of cells due to quality issues or recalls by the battery cell manufacturers; and ● an increase in the cost of raw materials, such as cobalt, used in lithium-ion cells. Any disruption in the supply of lithium-ion battery cells, semiconductors, or integrated circuits could temporarily disrupt production of the Company’s vehicles until a different supplier is fully qualified. Moreover, battery cell manufacturers may refuse to supply electric vehicle manufacturers if they determine that the vehicles are not sufficiently safe. Furthermore, fluctuations or shortages in petroleum and other economic conditions may cause the Company to experience significant increases in freight charges and raw material costs. Substantial increases in the prices for our raw materials would increase operating costs and could reduce our margins if the increased costs cannot be recouped through increased electric vehicle prices. There can be no assurance that the Company will be able to recoup the increasing costs of raw materials by increasing vehicle prices. We have made certain indemnities, under which we may be required to make payments to an indemnified party, in relation to certain transactions. We indemnify our directors and officers to the maximum extent permitted under the laws of the State of Delaware. In connection with our facility leases, we have indemnified our lessors for certain claims arising from the use of the facilities. The duration of the indemnities vary and, in many cases, are indefinite. These indemnities do not provide for any limitation of the maximum potential future payments we could be obligated to make. Historically, we have not been obligated to make any payments for these obligations and no liabilities have been recorded for these indemnities. On October 3, 2022, the Company received a letter from the Listing Qualifications Department of the Nasdaq Stock Market (“Nasdaq”) indicating that, based upon the closing bid price of the Company’s common stock for the 30 consecutive business day period between August 19, 2022 and September 30, 2022, the Company did not meet the minimum bid price of $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2). The letter also indicated that the Company will be provided with a compliance period of 180 calendar days, or until April 3, 2023 (the “Compliance Period”), in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A). On April 4, 2023, the Company received a letter from Nasdaq notifying the Company that the Company has been granted an additional 180-day period, or until October 2, 2023, to regain compliance with the Minimum Bid Price Requirement. The new compliance period is an extension of the Initial Compliance Period provided for in Nasdaq’s deficiency notice to the Company dated October 3, 2022. Nasdaq’s determination was based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Nasdaq Capital Market, with the exception of the Minimum Bid Price Requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary. If compliance with the Minimum Bid Price Requirement cannot be demonstrated by October 2, 2023, Nasdaq will provide written notification that the Company’s common stock could be delisted. In such an event, Nasdaq rules permit the Company to appeal any delisting determination to a Nasdaq Hearings Panel. Accordingly, there can be no assurance that the Company will be able to regain compliance with the Nasdaq listing rules or maintain its listing on the Nasdaq Stock Market. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The unaudited condensed consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiary in conformity with GAAP. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and in conformity with the instructions on Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring accruals, which are, in the opinion of management, necessary for a fair presentation of such statements. The results of operations for the three months ended March 31, 2023, are not necessarily indicative of the results that may be expected for the entire year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the accompanying notes for the fiscal year ended December 31, 2022, which are included in the Company’s Annual Report on Form 10-K, filed with the SEC on March 23, 2023. Use of Estimates The preparation of the unaudited condensed consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. The Company’s most significant estimates include marketable securities, revenue recognition, and the measurement of stock-based compensation expenses. Actual results could differ from these estimates. Marketable Securities Marketable securities include investment in fixed income bonds and U.S. Treasury securities that are considered to be highly liquid and easily tradeable. The marketable securities are considered trading securities and are measured at fair value and are accounted for in accordance with ASC 320. The marketable securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within the Company’s fair value hierarchy. The Company held $ 9,755,228 and $ 9,848,804 Revenue Recognition The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers To achieve this core principle, five basic criteria must be met before revenue can be recognized: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as the Company satisfies a performance obligation. Nature of goods and services The following is a description of the Company’s products and services from which the Company generates revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each: Product revenue Product revenue from customer contracts is recognized on the sale of each electric vehicle as vehicles are shipped to customers. The majority of the Company’s vehicle sales orders generally have only one performance obligation: sale and delivery of complete vehicles. Ownership and risk of loss transfers to the customer based on FOB shipping point and freight charges are the responsibility of the customer. Revenue is typically recognized at the point control transfers or in accordance with payment terms customary to the business. The Company provides product warranties to assure that the product assembly complies with agreed upon specifications. The Company’s product warranty is similar in all material respects to the product warranties provided by the Company’s suppliers, therefore minimizing the warranty liability to the standard labor rates associated with the defective part replacement. Customers do not have the option to purchase a warranty separately; as such, warranty is not accounted for as a separate performance obligation. The Company’s policy is to exclude taxes collected from a customer from the transaction price of automotive contracts. Shipping revenue Amounts billed to customers related to shipping and handling are classified as shipping revenue. The Company has elected to recognize the cost for freight and shipping when control over vehicles has transferred to the customer as an operating expense. The Company has reported shipping expenses of $ 20,566 110,549 Services and other revenue Services and other revenue consist of non-warranty after-sales vehicle services. Revenue is typically recognized at a point in time when services and replacement parts are provided. Miscellaneous income Miscellaneous income consists of late fees charged for receivables not paid within the terms of the customer agreement based upon the outstanding customer receivable balance. This revenue is earned when a customer’s receivable balance becomes delinquent, and its collection is reasonably assured and is calculated using a stated late fee rate multiplied by the outstanding balance that is subject to a late fee charge. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation (“ASC 718”). The Company recognizes all employee and non-employee share-based compensation as an expense in the financial statements on a straight-line basis over the requisite service period, based on the terms of the awards. Equity-classified awards principally related to stock options, restricted stock awards (“RSAs”) and equity-based compensation, are measured at the grant date fair value of the award. The Company determines grant date fair value of stock option awards using the Black-Scholes option-pricing model. The fair value of RSAs is determined using the closing price of the Company’s common stock on the grant date. For service based vesting grants, expense is recognized ratably over the requisite service period based on the number of options or shares. For value-based vesting grants, expense is recognized via straight line expense over the expected period per grant as determined by outside valuation experts. Stock-based compensation is reversed for forfeitures in the period of forfeiture. The Company estimates the fair value of stock-based and cash unit awards containing a market condition using a Monte Carlo simulation model. Key inputs and assumptions used in the Monte Carlo simulation model include the stock price of the award on the grant date, the expected term, the risk-free interest rate over the expected term, the expected annual dividend yield and the expected stock price volatility. The expected volatility is based on a combination of the historical and implied volatility of the Company’s publicly traded, near-the-money stock options, and the valuation period is based on the vesting period of the awards. The risk-free interest rate is derived from the U.S. Treasury yield curve in effect at the time of grant and, since the Company does not currently pay or plan to pay a dividend on its common stock, the expected dividend yield was zero. Stock options and warrants issued as compensation for services provided to the Company are accounted for based upon the fair value of the underlying equity instrument. The attribution of the fair value of the equity instrument is charged directly to compensation expense over the period during which services are rendered. Basic and Diluted Loss Per Share Basic and diluted net loss per share is determined by dividing net loss by the weighted average ordinary shares outstanding during the period. For all periods presented with a net loss, the shares underlying the ordinary share options and warrants have been excluded from the calculation because their effect would be anti-dilutive. Therefore, the weighted-average shares outstanding used to calculate both basic and diluted loss per share is the same for periods with a net loss. The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be anti-dilutive: SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE Three Months Ended March 31, 2023 2022 Options to purchase common stock 777,922 1,107,773 Restricted stock unvested 1,310,668 892,248 Warrants outstanding 6,027,668 6,106,023 Preferred stock outstanding 2,475 2,475 Totals 8,118,733 8,108,519 |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUES | NOTE 4. REVENUES Disaggregation of Revenue Revenue by type was as follows: SCHEDULE OF DISAGGREGATION OF REVENUE 2023 2022 Three Months Ended March 31, 2023 2022 Revenue type Product revenue $ 120,282 $ 919,343 Shipping revenue (16,588 ) 107,503 Miscellaneous income 9,390 - Total Revenue $ 113,084 $ 1,026,846 Warranty Reserve The Company records a reserve for warranty repairs upon the initial delivery of vehicles to its dealer network. The Company provides a product warranty on each vehicle including powertrain, battery pack and electronics package. Such warranty matches the product warranty provided by its supply chain for warranty parts for all unaltered vehicles and is not considered a separate performance obligation. The supply chain warranty does not cover warranty-based labor needed to replace a part under warranty. Warranty reserves include management’s best estimate of the projected cost of labor to repair/replace all items under warranty. The Company reserves a percentage of all dealer-based sales to cover an industry-standard warranty fund to support dealer labor warranty repairs. Such percentage is recorded as a component of cost of revenues in the statement of operations. As of March 31, 2023, and December 31, 2022, warranty reserves were recorded within accrued expenses of $ 395,071 410,017 |
ACCOUNTS RECEIVABLE, NET
ACCOUNTS RECEIVABLE, NET | 3 Months Ended |
Mar. 31, 2023 | |
Credit Loss [Abstract] | |
ACCOUNTS RECEIVABLE, NET | NOTE 5. ACCOUNTS RECEIVABLE, NET Accounts receivable, net, consists of amounts due from invoiced customers and product deliveries and were as follows: SCHEDULE OF ACCOUNTS RECEIVABLE March 31, December 31, 2023 2022 Trade receivables $ 107,741 $ 512,420 Less: Allowance for doubtful accounts - (2,349 ) Accounts receivable, net $ 107,741 $ 510,071 The Company reduced allowance for doubtful accounts by $ 2,349 292,010 |
INVENTORY
INVENTORY | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 6. INVENTORY Inventory, net consisted of the following: SCHEDULE OF INVENTORY March 31, December 31, 2023 2022 Raw materials $ 927,854 $ 330,931 Work-in-progress - - Finished goods 593,808 639,450 Total $ 1,521,662 $ 970,381 For the three months ended March 31, 2023, and 2022, depreciation for fleet inventory was $ 0 23,892 |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 7. PREPAID EXPENSES AND OTHER CURRENT ASSETS SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS March 31, December 31, 2023 2022 Prepayments for inventory $ 1,767,942 $ 1,174,466 Prepayments for insurance 49,972 118,434 Prepayments for advances on design 75,000 75,000 Prepayments for software 144,041 103,851 Prepaid other 114,711 7,094 Total Prepaid Expenses and Other Current Assets $ 2,151,666 $ 1,478,845 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 8. PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT, NET March 31, December 31, 2023 2022 Computer and equipment $ 2,680,159 $ 1,970,001 Furniture and fixtures 383,559 323,789 Lease improvements 1,091,729 952,952 Computer software 455,875 455,875 Property and equipment, gross 4,611,322 3,702,617 Less: Accumulated depreciation (1,701,086 ) (1,510,280 ) Property and equipment, net $ 2,910,236 $ 2,192,337 Depreciation expense for the three months ended March 31, 2023, and 2022 was $ 190,806 84,492 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 3 Months Ended |
Mar. 31, 2023 | |
Cash and Cash Equivalents [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 9. STOCKHOLDERS’ EQUITY Restricted Stock On February 1, 2022, pursuant to the AYRO, Inc. 2020 Long-Term Incentive Plan, the Company issued 442,248 1.29 110,562 On February 24, 2021, pursuant to the AYRO, Inc. 2020 Long-Term Incentive Plan, the Company issued 172,000 7.66 43,000 Series H Convertible Preferred Stock SCHEDULE OF PAYMENT OF PREFERRED STOCK Number of Series H Preferred Stock outstanding as of March 31, 2023 8 Multiplied by the stated value $ 154 Equals the gross stated value $ 1,232 Divided by the conversion price $ 184.8 Equals the convertible shares of Company common stock 7 Multiplied by the fair market value of Company common stock as of March 31, 2023 $ 0.55 Equals the payment $ 4 Series H-3 Convertible Preferred Stock SCHEDULE OF PAYMENT OF PREFERRED STOCK Number of Series H-3 Preferred Stock outstanding as of March 31, 2023 1,234 Multiplied by the stated value $ 138 Equals the gross stated value $ 170,292 Divided by the conversion price $ 165.6 Equals the convertible shares of Company common stock 1,028 Multiplied by the fair market value of Company common stock as of March 31, 2023 $ 0.55 Equals the payment $ 565 Series H-6 Convertible Preferred Stock SCHEDULE OF PAYMENT OF PREFERRED STOCK Number of Series H-6 Preferred Stock outstanding as of March 31, 2023 50 Number of Series H Preferred Stock outstanding as of March 31, 2023 50 Multiplied by the stated value $ 72 Equals the gross stated value $ 3,600 Divided by the conversion price $ 2.5 Equals the convertible shares of Company common stock 1,440 Multiplied by the fair market value of Company common stock as of March 31, 2023 $ 0.55 Equals the payment $ 792 Warrants A summary of the Company’s warrants to purchase common stock activity is as follows: SCHEDULE OF WARRANT ACTIVITY Shares Underlying Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding at December 31, 2022 6,106,023 $ 7.30 1.32 Granted - - Exercised - - Expired (78,355 ) 11.29 Outstanding at March 31, 2023 6,027,668 $ 7.25 1.09 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 10. STOCK-BASED COMPENSATION AYRO 2020 Long Term Incentive Plan The Company has reserved a total of 4,089,650 398,232 Stock-based compensation, including restricted stock awards and stock options is included in the unaudited condensed consolidated statement of operations as follows: SCHEDULE OF STOCK-BASED COMPENSATION 2023 2022 Three Months Ended March 31, 2023 2022 Research and development $ 6,764 $ 16,704 Sales and marketing 5,924 12,945 General and administrative 254,053 258,461 Total $ 266,741 $ 288,110 Options The following table reflects a summary of stock option activity: SUMMARY OF STOCK-BASED COMPENSATION, STOCK OPTIONS, ACTIVITY Number of Shares Weighted Average Exercise Price Contractual Life (Years) Outstanding at December 31, 2022 777,922 $ 6.15 7.56 Outstanding at March 31, 2023 777,922 $ 6.15 7.45 Of the outstanding options, 617,201 0 The Company recognized $ 20,116 32,376 122,532 a Restricted Stock SCHEDULE OF RESTRICTED STOCK ACTIVITY Number of Shares Weighted Average Grant Price Outstanding at December 31, 2022 660,562 $ 1.91 Granted 760,668 0.75 Vested (110,562 ) 1.29 Forfeitures - Outstanding at March 31, 2023 1,310,668 $ 1.29 On February 1, 2023, pursuant to the AYRO, Inc. 2020 Long-Term Incentive Plan, the Company issued 760,668 0.75 The Company recognized compensation expense related to all restricted stock during the three months ended March 31, 2023, and 2022 of $ 246,625 255,734 646,932 |
CONCENTRATIONS AND CREDIT RISK
CONCENTRATIONS AND CREDIT RISK | 3 Months Ended |
Mar. 31, 2023 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS AND CREDIT RISK | NOTE 11. CONCENTRATIONS AND CREDIT RISK Revenues One customer accounted for approximately 95 100 Accounts Receivable As of March 31, 2023, one customer accounted for 100 100 Purchasing The Company places orders with various suppliers. During the three months ended March 31, 2023, two suppliers accounted for more than 10 % of the Company’s raw materials, one supplier accounted for 41 % the other 34 %. During the three months ended March 31, 2022, two suppliers accounted for accounted for more than 10 % of the Company’s raw materials. One supplier accounted for 65 % and the other 15 %. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 12. COMMITMENTS AND CONTINGENCIES Manufacturing Agreements On July 28, 2022, the Company partnered with Linamar Corporation (“Linamar”) a Canadian manufacturer, in a manufacturing agreement (the “Linamar MLA”) to provide certain sub assembly and assembly parts, including the cabin frame and skate for the Vanish (collectively, the “Products”). During the term of the Linamar MLA, Linamar has the exclusive right to supply the Products to the Company, subject to certain exceptions. The Linamar MLA has an initial term of three years and will automatically renew for successive two-year terms unless either party has given at least 12 months’ written notice of nonrenewal. Either party may terminate the Linamar MLA at any time upon 12 months’ written notice, and in the event of a change in control of the Company prior to the end of the initial term, the Company may terminate upon written notice within three days of completion of such change in control. In the event the Company terminates the Linamar MLA prior to its expiration, whether following a change in control or otherwise, the Company must purchase any remaining raw material inventory, finished goods inventory and work in progress and any unamortized capital equipment used in production and testing of the Products and pay a termination fee of $ 750,000 Under the Linamar MLA, the Company must commit to certain minimum purchase requirements, to be determined by AYRO on a quarterly basis. Supply Chain Agreements In 2017, the Company executed a supply chain contract with Cenntro, which has historically been the Company’s primary supplier. Cenntro was previously a significant stockholder in AYRO Operating. Cenntro owns the design of the AYRO 411 Fleet vehicles and has granted the Company an exclusive license to purchase the AYRO 411 Fleet vehicles for sale in North America. The Company purchased 100% of its vehicle chassis, cabs and wheels for AYRO 411 Fleet Vehicles through this supply chain relationship with Cenntro. The Company must sell a minimum number of units in order to maintain its exclusive supply chain contract. As of December 31, 2021, the net balance between prepaid expenses and accrued expenses with Cenntro was a prepaid balance of $ 602,016 zero 621,097 1,317,289 The Company has canceled all purchase orders and future builds with Cenntro and currently intends to only order replacement parts from Cenntro in the future. Litigation The Company is subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business, that it believes are incidental to the operation of its business. While the outcome of these claims cannot be predicted with certainty, management does not believe that the outcome of any of these legal matters will have a material adverse effect on its results of operations, financial positions or cash flows. On March 23, 2018, DropCar was made aware of an audit being conducted by the New York State Department of Labor (“DOL”) regarding a claim filed by an employee. The DOL is investigating whether DropCar properly paid overtime for which DropCar has raised several defenses. In addition, the DOL is conducting its audit to determine whether the Company owes spread of hours pay (non-exempt worker whose workday is longer than ten hours must receive an extra hour of pay at the basic minimum hourly rate). Management believes the case has no merit. DropCar was audited by the New York State Department of Taxation and Finance (“DOTF”) for its sales tax paid over the period of 2017 – 2020. The DOTF believes DropCar owes additional sales tax plus interest. Management is investigating the details this audit. As of December 31, 2021, the Company has accrued $ 476,280 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The unaudited condensed consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiary in conformity with GAAP. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and in conformity with the instructions on Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring accruals, which are, in the opinion of management, necessary for a fair presentation of such statements. The results of operations for the three months ended March 31, 2023, are not necessarily indicative of the results that may be expected for the entire year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the accompanying notes for the fiscal year ended December 31, 2022, which are included in the Company’s Annual Report on Form 10-K, filed with the SEC on March 23, 2023. |
Use of Estimates | Use of Estimates The preparation of the unaudited condensed consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. The Company’s most significant estimates include marketable securities, revenue recognition, and the measurement of stock-based compensation expenses. Actual results could differ from these estimates. |
Marketable Securities | Marketable Securities Marketable securities include investment in fixed income bonds and U.S. Treasury securities that are considered to be highly liquid and easily tradeable. The marketable securities are considered trading securities and are measured at fair value and are accounted for in accordance with ASC 320. The marketable securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within the Company’s fair value hierarchy. The Company held $ 9,755,228 and $ 9,848,804 |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers To achieve this core principle, five basic criteria must be met before revenue can be recognized: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as the Company satisfies a performance obligation. Nature of goods and services The following is a description of the Company’s products and services from which the Company generates revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each: Product revenue Product revenue from customer contracts is recognized on the sale of each electric vehicle as vehicles are shipped to customers. The majority of the Company’s vehicle sales orders generally have only one performance obligation: sale and delivery of complete vehicles. Ownership and risk of loss transfers to the customer based on FOB shipping point and freight charges are the responsibility of the customer. Revenue is typically recognized at the point control transfers or in accordance with payment terms customary to the business. The Company provides product warranties to assure that the product assembly complies with agreed upon specifications. The Company’s product warranty is similar in all material respects to the product warranties provided by the Company’s suppliers, therefore minimizing the warranty liability to the standard labor rates associated with the defective part replacement. Customers do not have the option to purchase a warranty separately; as such, warranty is not accounted for as a separate performance obligation. The Company’s policy is to exclude taxes collected from a customer from the transaction price of automotive contracts. Shipping revenue Amounts billed to customers related to shipping and handling are classified as shipping revenue. The Company has elected to recognize the cost for freight and shipping when control over vehicles has transferred to the customer as an operating expense. The Company has reported shipping expenses of $ 20,566 110,549 Services and other revenue Services and other revenue consist of non-warranty after-sales vehicle services. Revenue is typically recognized at a point in time when services and replacement parts are provided. Miscellaneous income Miscellaneous income consists of late fees charged for receivables not paid within the terms of the customer agreement based upon the outstanding customer receivable balance. This revenue is earned when a customer’s receivable balance becomes delinquent, and its collection is reasonably assured and is calculated using a stated late fee rate multiplied by the outstanding balance that is subject to a late fee charge. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation (“ASC 718”). The Company recognizes all employee and non-employee share-based compensation as an expense in the financial statements on a straight-line basis over the requisite service period, based on the terms of the awards. Equity-classified awards principally related to stock options, restricted stock awards (“RSAs”) and equity-based compensation, are measured at the grant date fair value of the award. The Company determines grant date fair value of stock option awards using the Black-Scholes option-pricing model. The fair value of RSAs is determined using the closing price of the Company’s common stock on the grant date. For service based vesting grants, expense is recognized ratably over the requisite service period based on the number of options or shares. For value-based vesting grants, expense is recognized via straight line expense over the expected period per grant as determined by outside valuation experts. Stock-based compensation is reversed for forfeitures in the period of forfeiture. The Company estimates the fair value of stock-based and cash unit awards containing a market condition using a Monte Carlo simulation model. Key inputs and assumptions used in the Monte Carlo simulation model include the stock price of the award on the grant date, the expected term, the risk-free interest rate over the expected term, the expected annual dividend yield and the expected stock price volatility. The expected volatility is based on a combination of the historical and implied volatility of the Company’s publicly traded, near-the-money stock options, and the valuation period is based on the vesting period of the awards. The risk-free interest rate is derived from the U.S. Treasury yield curve in effect at the time of grant and, since the Company does not currently pay or plan to pay a dividend on its common stock, the expected dividend yield was zero. Stock options and warrants issued as compensation for services provided to the Company are accounted for based upon the fair value of the underlying equity instrument. The attribution of the fair value of the equity instrument is charged directly to compensation expense over the period during which services are rendered. |
Basic and Diluted Loss Per Share | Basic and Diluted Loss Per Share Basic and diluted net loss per share is determined by dividing net loss by the weighted average ordinary shares outstanding during the period. For all periods presented with a net loss, the shares underlying the ordinary share options and warrants have been excluded from the calculation because their effect would be anti-dilutive. Therefore, the weighted-average shares outstanding used to calculate both basic and diluted loss per share is the same for periods with a net loss. The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be anti-dilutive: SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE Three Months Ended March 31, 2023 2022 Options to purchase common stock 777,922 1,107,773 Restricted stock unvested 1,310,668 892,248 Warrants outstanding 6,027,668 6,106,023 Preferred stock outstanding 2,475 2,475 Totals 8,118,733 8,108,519 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE | The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be anti-dilutive: SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE Three Months Ended March 31, 2023 2022 Options to purchase common stock 777,922 1,107,773 Restricted stock unvested 1,310,668 892,248 Warrants outstanding 6,027,668 6,106,023 Preferred stock outstanding 2,475 2,475 Totals 8,118,733 8,108,519 |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
SCHEDULE OF DISAGGREGATION OF REVENUE | Revenue by type was as follows: SCHEDULE OF DISAGGREGATION OF REVENUE 2023 2022 Three Months Ended March 31, 2023 2022 Revenue type Product revenue $ 120,282 $ 919,343 Shipping revenue (16,588 ) 107,503 Miscellaneous income 9,390 - Total Revenue $ 113,084 $ 1,026,846 |
ACCOUNTS RECEIVABLE, NET (Table
ACCOUNTS RECEIVABLE, NET (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Credit Loss [Abstract] | |
SCHEDULE OF ACCOUNTS RECEIVABLE | Accounts receivable, net, consists of amounts due from invoiced customers and product deliveries and were as follows: SCHEDULE OF ACCOUNTS RECEIVABLE March 31, December 31, 2023 2022 Trade receivables $ 107,741 $ 512,420 Less: Allowance for doubtful accounts - (2,349 ) Accounts receivable, net $ 107,741 $ 510,071 |
INVENTORY (Tables)
INVENTORY (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
SCHEDULE OF INVENTORY | Inventory, net consisted of the following: SCHEDULE OF INVENTORY March 31, December 31, 2023 2022 Raw materials $ 927,854 $ 330,931 Work-in-progress - - Finished goods 593,808 639,450 Total $ 1,521,662 $ 970,381 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS March 31, December 31, 2023 2022 Prepayments for inventory $ 1,767,942 $ 1,174,466 Prepayments for insurance 49,972 118,434 Prepayments for advances on design 75,000 75,000 Prepayments for software 144,041 103,851 Prepaid other 114,711 7,094 Total Prepaid Expenses and Other Current Assets $ 2,151,666 $ 1,478,845 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT, NET | Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT, NET March 31, December 31, 2023 2022 Computer and equipment $ 2,680,159 $ 1,970,001 Furniture and fixtures 383,559 323,789 Lease improvements 1,091,729 952,952 Computer software 455,875 455,875 Property and equipment, gross 4,611,322 3,702,617 Less: Accumulated depreciation (1,701,086 ) (1,510,280 ) Property and equipment, net $ 2,910,236 $ 2,192,337 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
SCHEDULE OF WARRANT ACTIVITY | A summary of the Company’s warrants to purchase common stock activity is as follows: SCHEDULE OF WARRANT ACTIVITY Shares Underlying Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding at December 31, 2022 6,106,023 $ 7.30 1.32 Granted - - Exercised - - Expired (78,355 ) 11.29 Outstanding at March 31, 2023 6,027,668 $ 7.25 1.09 |
Series H Convertible Preferred Stock [Member] | |
SCHEDULE OF PAYMENT OF PREFERRED STOCK | SCHEDULE OF PAYMENT OF PREFERRED STOCK Number of Series H Preferred Stock outstanding as of March 31, 2023 8 Multiplied by the stated value $ 154 Equals the gross stated value $ 1,232 Divided by the conversion price $ 184.8 Equals the convertible shares of Company common stock 7 Multiplied by the fair market value of Company common stock as of March 31, 2023 $ 0.55 Equals the payment $ 4 |
Convertible Preferred Stock Series H-3 [Member] | |
SCHEDULE OF PAYMENT OF PREFERRED STOCK | SCHEDULE OF PAYMENT OF PREFERRED STOCK Number of Series H-3 Preferred Stock outstanding as of March 31, 2023 1,234 Multiplied by the stated value $ 138 Equals the gross stated value $ 170,292 Divided by the conversion price $ 165.6 Equals the convertible shares of Company common stock 1,028 Multiplied by the fair market value of Company common stock as of March 31, 2023 $ 0.55 Equals the payment $ 565 |
Series H Six Convertible Preferred Stock [Member] | |
SCHEDULE OF PAYMENT OF PREFERRED STOCK | SCHEDULE OF PAYMENT OF PREFERRED STOCK Number of Series H-6 Preferred Stock outstanding as of March 31, 2023 50 Number of Series H Preferred Stock outstanding as of March 31, 2023 50 Multiplied by the stated value $ 72 Equals the gross stated value $ 3,600 Divided by the conversion price $ 2.5 Equals the convertible shares of Company common stock 1,440 Multiplied by the fair market value of Company common stock as of March 31, 2023 $ 0.55 Equals the payment $ 792 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
SCHEDULE OF STOCK-BASED COMPENSATION | Stock-based compensation, including restricted stock awards and stock options is included in the unaudited condensed consolidated statement of operations as follows: SCHEDULE OF STOCK-BASED COMPENSATION 2023 2022 Three Months Ended March 31, 2023 2022 Research and development $ 6,764 $ 16,704 Sales and marketing 5,924 12,945 General and administrative 254,053 258,461 Total $ 266,741 $ 288,110 |
SUMMARY OF STOCK-BASED COMPENSATION, STOCK OPTIONS, ACTIVITY | The following table reflects a summary of stock option activity: SUMMARY OF STOCK-BASED COMPENSATION, STOCK OPTIONS, ACTIVITY Number of Shares Weighted Average Exercise Price Contractual Life (Years) Outstanding at December 31, 2022 777,922 $ 6.15 7.56 Outstanding at March 31, 2023 777,922 $ 6.15 7.45 |
SCHEDULE OF RESTRICTED STOCK ACTIVITY | SCHEDULE OF RESTRICTED STOCK ACTIVITY Number of Shares Weighted Average Grant Price Outstanding at December 31, 2022 660,562 $ 1.91 Granted 760,668 0.75 Vested (110,562 ) 1.29 Forfeitures - Outstanding at March 31, 2023 1,310,668 $ 1.29 |
LIQUIDITY AND OTHER UNCERTAIN_2
LIQUIDITY AND OTHER UNCERTAINTIES (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Liquidity And Other Uncertainties | |||
Net losses | $ 5,475,769 | $ 4,578,660 | |
Net cash provided by (used in) operating activities | 6,536,154 | $ 5,545,113 | |
Cash and cash equivalents, at carrying value | 31,990,835 | $ 39,096,562 | |
Marketable securities, current | 9,755,228 | $ 9,848,804 | |
Working capital | $ 5,949,444 |
SCHEDULE OF ANTIDILUTIVE SECURI
SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 8,118,733 | 8,108,519 |
Options to Purchase Common Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 777,922 | 1,107,773 |
Restricted Stock Unvested [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 1,310,668 | 892,248 |
Warrants Outstanding [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 6,027,668 | 6,106,023 |
Preferred Stock Outstanding [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 2,475 | 2,475 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | |||
Marketable securities | $ 9,755,228 | $ 9,848,804 | |
Shipping expenses | $ 20,566 | $ 110,549 |
SCHEDULE OF DISAGGREGATION OF R
SCHEDULE OF DISAGGREGATION OF REVENUE (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total Revenue | $ 113,084 | $ 1,026,846 |
Product [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 120,282 | 919,343 |
Shipping Revenue [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | (16,588) | 107,503 |
Miscellaneous Income [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | $ 9,390 |
REVENUES (Details Narrative)
REVENUES (Details Narrative) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Warranty reserves | $ 395,071 | $ 410,017 |
SCHEDULE OF ACCOUNTS RECEIVABLE
SCHEDULE OF ACCOUNTS RECEIVABLE (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Credit Loss [Abstract] | ||
Trade receivables | $ 107,741 | $ 512,420 |
Less: Allowance for doubtful accounts | (2,349) | |
Accounts receivable, net | $ 107,741 | $ 510,071 |
ACCOUNTS RECEIVABLE, NET (Detai
ACCOUNTS RECEIVABLE, NET (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Credit Loss [Abstract] | ||
Changes in allowance for doubtful accounts receivable | $ 2,349 | |
Bad debt expense | $ 292,010 | $ 11,657 |
SCHEDULE OF INVENTORY (Details)
SCHEDULE OF INVENTORY (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 927,854 | $ 330,931 |
Work-in-progress | ||
Finished goods | 593,808 | 639,450 |
Total | $ 1,521,662 | $ 970,381 |
INVENTORY (Details Narrative)
INVENTORY (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Inventory [Line Items] | ||
Depreciation for fleet inventory | $ 190,806 | $ 84,492 |
Fleet Inventory [Member] | ||
Inventory [Line Items] | ||
Depreciation for fleet inventory | $ 0 | $ 23,892 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepayments for inventory | $ 1,767,942 | $ 1,174,466 |
Prepayments for insurance | 49,972 | 118,434 |
Prepayments for advances on design | 75,000 | 75,000 |
Prepayments for software | 144,041 | 103,851 |
Prepaid other | 114,711 | 7,094 |
Total Prepaid Expenses and Other Current Assets | $ 2,151,666 | $ 1,478,845 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT, NET (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 4,611,322 | $ 3,702,617 |
Less: Accumulated depreciation | (1,701,086) | (1,510,280) |
Property and equipment, net | 2,910,236 | 2,192,337 |
Computer And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,680,159 | 1,970,001 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 383,559 | 323,789 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,091,729 | 952,952 |
Computer Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 455,875 | $ 455,875 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 190,806 | $ 84,492 |
SCHEDULE OF PAYMENT OF PREFERRE
SCHEDULE OF PAYMENT OF PREFERRED STOCK (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Convertible Preferred Stock Series H [Member] | ||
Number of Series H Preferred Stock outstanding as of March 31, 2023 | 8 | 8 |
Multiplied by the stated value | $ 154 | |
Equals the gross stated value | $ 1,232 | |
Divided by the conversion price | $ 184.8 | |
Equals the convertible shares of Company common stock | 7 | |
Multiplied by the fair market value of Company common stock as of March 31, 2023 | $ 0.55 | |
Equals the payment | $ 4 | |
Convertible Preferred Stock Series H-3 [Member] | ||
Number of Series H Preferred Stock outstanding as of March 31, 2023 | 1,234 | 1,234 |
Multiplied by the stated value | $ 138 | |
Equals the gross stated value | $ 170,292 | |
Divided by the conversion price | $ 165.6 | |
Equals the convertible shares of Company common stock | 1,028 | |
Multiplied by the fair market value of Company common stock as of March 31, 2023 | $ 0.55 | |
Equals the payment | $ 565 | |
Convertible Preferred Stock Series H-6 [Member] | ||
Number of Series H Preferred Stock outstanding as of March 31, 2023 | 50 | 50 |
Multiplied by the stated value | $ 72 | |
Equals the gross stated value | $ 3,600 | |
Divided by the conversion price | $ 2.5 | |
Equals the convertible shares of Company common stock | 1,440 | |
Multiplied by the fair market value of Company common stock as of March 31, 2023 | $ 0.55 | |
Equals the payment | $ 792 |
SCHEDULE OF WARRANT ACTIVITY (D
SCHEDULE OF WARRANT ACTIVITY (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Cash and Cash Equivalents [Abstract] | |
Shares Underlying Warrants Outstanding | shares | 6,106,023 |
Weighted Average Exercise Price Outstanding | $ / shares | $ 7.30 |
Weighted Average Remaining Contractual Life | 1 year 3 months 25 days |
Shares Underlying Warrants Granted | shares | |
Weighted Average Exercise Price Granted | $ / shares | |
Shares Underlying Warrants Exercised | shares | |
Weighted Average Exercise Price Exercised | $ / shares | |
Shares Underlying Warrants Expired | shares | (78,355) |
Weighted Average Exercise Price Expired | $ / shares | $ 11.29 |
Shares underlying warrants outstanding | shares | 6,027,668 |
Weighted Average Exercise Price Outstanding | $ / shares | $ 7.25 |
Weighted Average Remaining Contractual Life | 1 year 1 month 2 days |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - Directors [Member] - Restricted Stock [Member] - 2020 Long-Term Incentive Plan [Member] - $ / shares | Feb. 01, 2023 | Jan. 27, 2023 | Feb. 24, 2021 | Dec. 31, 2022 | Dec. 31, 2021 |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Number of restricted stock units | 760,668 | 442,248 | 172,000 | ||
Share price | $ 0.75 | $ 1.29 | $ 7.66 | ||
Common stock unissued | 110,562 | 43,000 |
SCHEDULE OF STOCK-BASED COMPENS
SCHEDULE OF STOCK-BASED COMPENSATION (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total | $ 266,741 | $ 288,110 |
Research And Development [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total | 6,764 | 16,704 |
Sales And Marketing [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total | 5,924 | 12,945 |
General And Administrative [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total | $ 254,053 | $ 258,461 |
SUMMARY OF STOCK-BASED COMPENSA
SUMMARY OF STOCK-BASED COMPENSATION, STOCK OPTIONS, ACTIVITY (Details) - Common Stock [Member] | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Number of Stock options outstanding, Beginning balance | shares | 777,922 |
Weighted Average Exercise Price Outstanding, Beginning balance | $ / shares | $ 6.15 |
Weighted average remaining contractual life | 7 years 6 months 21 days |
Number of Stock options outstanding, Ending balance | shares | 777,922 |
Weighted Average Exercise Price Outstanding, Ending balance | $ / shares | $ 6.15 |
Weighted average remaining contractual life | 7 years 5 months 12 days |
SCHEDULE OF RESTRICTED STOCK AC
SCHEDULE OF RESTRICTED STOCK ACTIVITY (Details) - Restricted Stock Units (RSUs) [Member] | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares, Outstanding, Beginning balance | 660,562 |
Weighted Average Grant Price, Outstanding, Beginning balance | $ / shares | $ 1.91 |
Number of shares, Granted | 760,668 |
Weighted Average Grant Price, Granted | $ / shares | $ 0.75 |
Number of shares, Vested | (110,562) |
Weighted Average Grant Price, Vested | $ / shares | $ 1.29 |
Number of shares, Forfeited | |
Number of shares, Outstanding, Ending balance | 1,310,668 |
Weighted Average Grant Price, Outstanding, Ending balance | $ / shares | $ 1.29 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details Narrative) - USD ($) | 3 Months Ended | ||||
Feb. 01, 2023 | Jan. 27, 2023 | Feb. 24, 2021 | Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Share-based Compensation | $ 266,741 | $ 288,110 | |||
Share-Based Payment Arrangement, Option [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Number of stock options vested and exercisable | 617,201 | ||||
Aggregate intrinsic value of stock options vested and exercisable | $ 0 | ||||
Share-based Compensation | 20,116 | 32,376 | |||
Share-based payment arrangement, nonvested award, option, cost not yet recognized, amount | 122,532 | ||||
Stock or unit option plan expense | 246,625 | $ 255,734 | |||
Restricted stock not yet recognized | $ 646,932 | ||||
2020 Long Term Incentive Plan [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Number of shares reserved | 4,089,650 | ||||
Number of stock options available for grants | 398,232 | ||||
2020 Long-Term Incentive Plan [Member] | Restricted Stock [Member] | Directors [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Number of restricted stock units | 760,668 | 442,248 | 172,000 | ||
Share price | $ 0.75 | $ 1.29 | $ 7.66 |
CONCENTRATIONS AND CREDIT RISK
CONCENTRATIONS AND CREDIT RISK (Details Narrative) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Sales Revenue [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 95% | 100% |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 100% | 100% |
Cost of Goods and Service, Product and Service Benchmark [Member] | Supplier Concentration Risk [Member] | Two Suppliers [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 10% | 10% |
Cost of Goods and Service, Product and Service Benchmark [Member] | Supplier Concentration Risk [Member] | Supplier One [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 41% | 65% |
Cost of Goods and Service, Product and Service Benchmark [Member] | Supplier Concentration Risk [Member] | Two Supplier [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 34% | 15% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Termination fee | $ 750,000 | ||||
Cost of goods sold | $ 219,792 | $ 1,177,145 | |||
Cenntro Automotive Group Ltd [Member] | |||||
Prepaid balance | 0 | $ 602,016 | |||
Cost of goods sold | $ 621,097 | ||||
Inventory written-off | $ 1,317,289 | ||||
DropCar Operating, Inc. [Member] | |||||
Accrued additional sales tax and interest | $ 476,280 | ||||
Payment for additional sales tax and interest | $ 476,280 |