Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 28, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Entity Registrant Name | CHARGE ENTERPRISES, INC. | ||
Entity Central Index Key | 0001277250 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Dec. 31, 2022 | ||
Entity Filer Category | Accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2023 | ||
Entity Ex Transition Period | false | ||
Entity Common Stock Shares Outstanding | 206,644,914 | ||
Entity Public Float | $ 454.4 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity File Number | 333-253073 | ||
Entity Incorporation State Country Code | DE | ||
Entity Tax Identification Number | 90-0471969 | ||
Entity Interactive Data Current | Yes | ||
Icfr Auditor Attestation Flag | false | ||
Entity Address Address Line 1 | 125 Park Avenue | ||
Entity Address Address Line 2 | 25th Floor | ||
Entity Address City Or Town | New York | ||
Entity Address State Or Province | NY | ||
Entity Address Postal Zip Code | 10017 | ||
City Area Code | 212 | ||
Local Phone Number | 921-2100 | ||
Trading Symbol | CRGE | ||
Security Exchange Name | NASDAQ | ||
Security 12b Title | Common Stock, par value $.0001 per share | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Location | Charlotte, North Carolina | ||
Auditor Firm Id | 759 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 26,837,000 | $ 18,238,000 |
Restricted cash | 886,000 | 0 |
Accounts receivable net of allowances of $322 in 2022 and $268 in 2021, respectively | 72,405,000 | 73,334,000 |
Inventory | 111,000 | 111,000 |
Deposits, prepaids and other current assets | 3,187,000 | 1,721,000 |
Investments in marketable securities | 6,757,000 | 9,619,000 |
Investments in non-marketable securities | 236,000 | 100,000 |
Cost in excess of billings | 6,090,000 | 4,812,000 |
Total current assets | 116,509,000 | 107,935,000 |
Property, plant and equipment, net | 732,000 | 2,012,000 |
Finance lease right-of-use asset | 341,000 | 470,000 |
Operating lease right-of-use asset | 4,028,000 | 1,558,000 |
Non-current assets | 240,000 | 0 |
Net deferred tax asset | 5,580,000 | |
Goodwill, net | 12,672,000 | 26,055,000 |
Intangible assets, net | 33,932,000 | 0 |
Total assets | 168,454,000 | 143,610,000 |
Current liabilities | ||
Accounts payable | 61,644,000 | 71,428,000 |
Accrued liabilities | 11,121,000 | 5,740,000 |
Deferred revenue | 13,741,000 | 7,018,000 |
Derivative liability | 6,521,000 | 0 |
Finance lease liability | 112,000 | 159,000 |
Operating lease liability | 1,579,000 | 125,000 |
Current portion of long-term debt | 29,180,000 | 4,598,000 |
Total current liabilities | 123,898,000 | 89,068,000 |
Non-current liabilities | ||
Finance lease liability, non-current | 146,000 | 219,000 |
Operating lease liability, non-current | 2,199,000 | 1,443,000 |
Net deferred tax liability | 1,389 | 0 |
Long-term debt, net of current portion | 0 | 30,563,000 |
Total liabilities | 127,632,000 | 121,293,000 |
Mezzanine Equity | ||
Total Mezzanine Equity | 16,572,000 | 6,850,000 |
Commitments, contingencies and concentration risk | 0 | 0 |
Stockholders' Equity | ||
Common stock, $0.0001 par value; 750,000,000 shares authorized 206,844,580 and 184,266,934 issued and outstanding at December 31, 2022 and December 31, 2021, respectively | 20,000 | 18,000 |
Common stock to be issued, 0 shares at December 31, 2022 and 6,587,897 at December 31, 2021 | 0 | 1,000 |
Additional paid in capital | 197,816,000 | 126,870,000 |
Accumulated other comprehensive income (loss) | 0 | (32,000) |
Accumulated deficit | (173,586,000) | (111,390,000) |
Total stockholders' equity | 24,250,000 | 15,467,000 |
Total liabilities and stockholders' equity | 168,454,000 | 143,610,000 |
Mezzanine Equity | 24,250,000 | 15,467,000 |
Series B Preferred stock [Member] | ||
Stockholders' Equity | ||
Total stockholders' equity | 0 | 6,850,000 |
Mezzanine Equity | 0 | 6,850,000 |
Series C Preferred Stock [Member] | ||
Stockholders' Equity | ||
Preferred stock, value | 0 | 0 |
Total stockholders' equity | 16,572,000 | 0 |
Mezzanine Equity | 16,572,000 | 0 |
Series D Preferred stock [Member] | ||
Stockholders' Equity | ||
Preferred stock, value | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounts receivable net of allowances | $ 322 | $ 268 |
Preferred stock, Par Value | $ 0.0001 | $ 0.0001 |
Preferred Stock, Authorized | 20,000,000 | 20,000,000 |
Common Stock, Par Value | $ 0.0001 | $ 0.0001 |
Common Stock, Authorized | 750,000,000 | 750,000,000 |
Common Stock, Issued | 206,844,580 | 184,266,934 |
Common Stock, Outstanding | 206,844,580 | 184,266,934 |
Common Stock To Be Issued | 0 | 6,587,897 |
Series B Preferred stock [Member] | ||
Mezzanine equity, share issued | 0 | 2,395,105 |
Mezzanine equity, share outstanding | 0 | 2,395,105 |
Series C Preferred Stock [Member] | ||
Mezzanine equity, share issued | 6,226,370 | |
Mezzanine equity, share outstanding | 6,226,370 | |
Preferred Stock Issued | 2,370,370 | |
Preferred Stock, Outstanding | 2,370,370 | |
Series D Preferred stock [Member] | ||
Preferred Stock Issued | 1,177,023 | |
Preferred Stock, Outstanding | 1,177,023 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenues | $ 697,833 | $ 477,018 |
Cost of Goods Sold | 669,620 | 465,503 |
Gross Profit | 28,213 | 11,515 |
Operating expenses | ||
Stock-based compensation | 35,449 | 30,623 |
General and administrative | 14,392 | 7,995 |
Salaries and related benefits | 16,667 | 8,806 |
Professional fees | 3,290 | 1,846 |
Depreciation and amortization expense | 6,377 | 529 |
Total operating expenses | 76,175 | 49,799 |
(Loss) from operations | (47,962) | (38,284) |
Other income (expenses): | ||
Loss on impairment | (797) | (18,116) |
Income (loss) from investments, net | (789) | 3,330 |
Change in fair value of derivative liabilities | 33,921 | 0 |
Interest expense | (11,905) | (4,619) |
Other income (expense), net | (2,482) | 1,063 |
Foreign exchange adjustments | (60) | (334) |
Total other income (expenses), net | 17,888 | (18,676) |
Income (loss) before income taxes | (30,074) | (56,960) |
Income tax benefit (expense) | (275) | 5,292 |
Net (loss) | (30,349) | (51,668) |
Less: Deemed dividend | (36,697) | (7,407) |
Less: Preferred dividends | (1,349) | 0 |
Net (loss) available to common stockholders | $ (68,395) | $ (59,075) |
Basic income (loss) per share available to common stockholders | $ (0.35) | $ (0.38) |
Diluted income (loss) per share available to common stockholders | $ (0.35) | $ (0.38) |
Weighted average number of shares outstanding, basic | 197,712 | 156,365 |
Weighted average number of shares outstanding, diluted | 197,712 | 156,365 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Net income (loss) | $ (30,349) | $ (51,668) |
Other comprehensive income (loss), net of tax | ||
Foreign currency translation adjustment | 32 | (93) |
Other comprehensive income (loss), net of tax | 32 | (93) |
Comprehensive (loss) | $ (30,317) | $ (51,761) |
STATEMENTS OF STOCKHOLDERS EQUI
STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) | Total | Preferred Stock | Common Stock | Common Stock To Be Issued | Additional Paid-In Capital | Accumulated other comprehensive income | Accumulated Deficit |
Balance, shares at Dec. 31, 2020 | 1,000,000 | 140,018,383 | 13,425,750 | ||||
Balance, amount at Dec. 31, 2020 | $ 20,652,000 | $ 1,000 | $ 140,000 | $ 13,000 | $ 72,583,000 | $ 60,000 | $ (52,145,000) |
Shares of common stock from prior year issued, shares | 8,700,000 | (8,700,000) | |||||
Shares of common stock from prior year issued, amount | 0 | 0 | $ 9,000 | $ (9,000) | 0 | 0 | 0 |
Common stock issued for services, shares | 66,092 | ||||||
Common stock issued for services, amount | 167,000 | 0 | $ 0 | $ 0 | 167,000 | 0 | 0 |
Conversion of debt and accrued interest, shares | 644,499 | 3,478,795 | |||||
Conversion of debt and accrued interest, amount | 1,012,000 | 0 | $ 1,000 | $ 4,000 | 1,007,000 | 0 | 0 |
Stock-based compensation expense | 4,563,000 | 0 | 0 | 0 | 4,563,000 | 0 | 0 |
Adjustment to par value | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Net loss | (1,599,000) | 0 | 0 | 0 | 0 | (20,000) | (1,579,000) |
Balance, amount at Mar. 31, 2021 | 24,795,000 | $ 1,000 | $ 150,000 | $ 8,000 | 78,320,000 | 40,000 | (53,724,000) |
Balance, shares at Mar. 31, 2021 | 1,000,000 | 149,428,974 | 8,204,545 | ||||
Balance, shares at Dec. 31, 2020 | 1,000,000 | 140,018,383 | 13,425,750 | ||||
Balance, amount at Dec. 31, 2020 | 20,652,000 | $ 1,000 | $ 140,000 | $ 13,000 | 72,583,000 | 60,000 | (52,145,000) |
Net income (loss) | (51,668,000) | ||||||
Balance, amount at Dec. 31, 2021 | 15,467,000 | $ 0 | $ 18,000 | $ 1,000 | 126,870,000 | (32,000) | (111,390,000) |
Balance, shares at Dec. 31, 2021 | 2,370,370 | 184,266,934 | 6,587,897 | ||||
Balance, shares at Mar. 31, 2021 | 1,000,000 | 149,428,974 | 8,204,545 | ||||
Balance, amount at Mar. 31, 2021 | 24,795,000 | $ 1,000 | $ 150,000 | $ 8,000 | 78,320,000 | 40,000 | (53,724,000) |
Common stock issued for services, shares | 67,000 | ||||||
Common stock issued for services, amount | 112,000 | 0 | $ 0 | 0 | 112,000 | 0 | 0 |
Stock-based compensation expense | 9,230,000 | 0 | 0 | 0 | 9,230,000 | 0 | 0 |
Net loss | (10,147,000) | 0 | $ 0 | $ 0 | 0 | (62,000) | (10,085,000) |
Shares of common stock from prior period issued, shares | 2,783,089 | (2,783,089) | |||||
Shares of common stock from prior period issued, amount | 0 | 0 | $ 3,000 | $ (3,000) | 0 | 0 | 0 |
Warrants issued in connection with debt | 2,654,000 | 0 | 0 | 0 | 2,654,000 | 0 | 0 |
Derivative liability reclassed to equity | 750,000 | 0 | 0 | 0 | 750,000 | 0 | 0 |
Balance, amount at Jun. 30, 2021 | 27,394,000 | $ 1,000 | $ 153,000 | $ 5,000 | 91,066,000 | (22,000) | (63,809,000) |
Balance, shares at Jun. 30, 2021 | 1,000,000 | 152,279,063 | 5,421,456 | ||||
Common stock issued for services, shares | 23,438 | ||||||
Common stock issued for services, amount | 75,000 | $ 0 | $ 0 | $ 0 | 75,000 | 0 | 0 |
Conversion of debt and accrued interest, shares | 1,166,441 | ||||||
Conversion of debt and accrued interest, amount | 291,000 | 0 | 0 | $ 1,000 | 290,000 | 0 | 0 |
Stock-based compensation expense | 7,764,000 | 0 | 0 | 0 | 7,764,000 | 0 | 0 |
Net loss | (25,234,000) | 0 | 0 | 0 | 0 | (4,000) | (25,230,000) |
Cancellation of stock options | (250,000) | 0 | 0 | 0 | (250,000) | 0 | 0 |
Restricted stock units expense | 44,000 | 0 | $ 0 | 0 | 44,000 | 0 | 0 |
Buyback of treasury stock, shares | (76,178) | ||||||
Buyback of treasury stock, amount | (145,000) | 0 | $ 0 | 0 | (145,000) | 0 | 0 |
Balance, amount at Sep. 30, 2021 | 9,939,000 | $ 1,000 | $ 153,000 | $ 6,000 | 98,844,000 | (26,000) | (89,039,000) |
Balance, shares at Sep. 30, 2021 | 1,000,000 | 152,226,323 | 6,587,897 | ||||
Stock-based compensation expense | 9,676,000 | $ 0 | $ 0 | $ 0 | 9,676,000 | 0 | 0 |
Adjustment to par value | 0 | 0 | (167,000) | (5,000) | 172,000 | 0 | 0 |
Net loss | (14,781,000) | 0 | 0 | 0 | 0 | (6,000) | (14,775,000) |
Cancellation of stock options | (690,000) | 0 | 0 | 0 | (690,000) | 0 | 0 |
Restricted stock units expense | 287,000 | 0 | $ 0 | 0 | 287,000 | 0 | 0 |
Common stock issued for acquisition, shares | 1,285,715 | ||||||
Common stock issued for acquisition, amount | 4,538,000 | $ 0 | $ 1,000 | 0 | $ 4,537,000 | 0 | 0 |
Series A Preferred Stock converted to common stock, shares | (1,000,000) | 30,754,896 | (30,000) | ||||
Series A Preferred Stock converted to common stock, amount | 7,407,000 | $ (1,000) | $ 31,000 | 0 | $ 7,407,000 | 0 | 0 |
Issuance of Series C Preferred Stock, shares | 2,370,370 | ||||||
Issuance of Series C Preferred Stock, amount | $ 0 | 0 | 0 | ||||
Fair value of beneficial conversion feature | 3,551,000 | 0 | 0 | 0 | 3,551,000 | 0 | 0 |
Warrants issued in connection with Series C Preferred Stock | 3,116,000 | 0 | 0 | 0 | 3,116,000 | 0 | 0 |
Deemed dividend in connection with Series C Preferred Stock | (7,407,000) | 0 | 0 | 0 | 0 | 0 | (7,407,000) |
Dividend paid on Series B Preferred Stock | (169,000) | 0 | 0 | 0 | 0 | 0 | (169,000) |
Balance, amount at Dec. 31, 2021 | 15,467,000 | $ 0 | $ 18,000 | $ 1,000 | 126,870,000 | (32,000) | (111,390,000) |
Balance, shares at Dec. 31, 2021 | 2,370,370 | 184,266,934 | 6,587,897 | ||||
Stock-based compensation expense | 10,744,000 | $ 0 | $ 0 | $ 0 | 10,744,000 | 0 | 0 |
Net loss | (13,140,000) | 0 | $ 0 | 0 | 0 | 0 | (13,140,000) |
Common stock issued for acquisition, shares | 5,201,863 | ||||||
Common stock issued for acquisition, amount | 17,531,000 | 0 | $ 1,000 | 0 | 17,530,000 | 0 | 0 |
Deemed dividend in connection with Series C Preferred Stock | (3,856,000) | 0 | 0 | 0 | 0 | 0 | (3,856,000) |
Declaration of preferred dividends | (267,000) | $ 0 | 0 | 0 | 0 | 0 | (267,000) |
Series C Preferred Stock, shares | 3,856,000 | ||||||
Series C Preferred Stock, amount | 12,050,000 | $ 0 | 0 | 0 | 12,050,000 | 0 | 0 |
Beneficial conversion feature arising from preferred stock | 2,651,000 | 0 | $ 0 | 0 | 2,651,000 | 0 | 0 |
Conversion of debt into common stock, shares | 319,950 | ||||||
Conversion of debt into common stock, amount | 80,000 | 0 | $ 0 | 0 | 80,000 | 0 | 0 |
Balance, amount at Mar. 31, 2022 | 41,260,000 | $ 0 | $ 19,000 | $ 1,000 | 169,925,000 | (32,000) | (128,653,000) |
Balance, shares at Mar. 31, 2022 | 6,226,370 | 189,788,747 | 6,587,897 | ||||
Balance, shares at Dec. 31, 2021 | 2,370,370 | 184,266,934 | 6,587,897 | ||||
Balance, amount at Dec. 31, 2021 | 15,467,000 | $ 0 | $ 18,000 | $ 1,000 | 126,870,000 | (32,000) | (111,390,000) |
Net income (loss) | (30,349,000) | ||||||
Balance, amount at Dec. 31, 2022 | 24,250,000 | $ 20,000 | 197,816,000 | (173,586,000) | |||
Balance, shares at Dec. 31, 2022 | 1,177,023,000 | 206,844,580,000 | |||||
Balance, shares at Mar. 31, 2022 | 6,226,370 | 189,788,747 | 6,587,897 | ||||
Balance, amount at Mar. 31, 2022 | 41,260,000 | $ 0 | $ 19,000 | $ 1,000 | 169,925,000 | (32,000) | (128,653,000) |
Stock-based compensation expense | 9,343,000 | $ 0 | $ 0 | $ 0 | 9,343,000 | 0 | 0 |
Net loss | (19,642,000) | (19,642,000) | |||||
Declaration of preferred dividends | (353,000) | (353,000) | |||||
Series D Preferred Stock, shares | 1,177,023 | ||||||
Series D Preferred Stock, amount | 12,499,000 | 12,499,000 | |||||
Common stock issued for private placement, shares | 1,428,575 | ||||||
Common stock issued for private placement, amount | 4,696,000 | 4,696,000 | |||||
Issuance of warrants for private placement | 5,304,000 | 5,304,000 | |||||
Issuance of shares committed in prior period, shares | 1,862,146 | (1,862,146) | |||||
Settlement of holdback shares for acquisition, shares | 4,725,748 | (4,725,748) | |||||
Settlement of holdback shares for acquisition, amount | (1,000) | $ 1,000 | |||||
Exercise of warrants, shares | 5,973,515 | ||||||
Exercise of warrants, amount | 1,073,000 | $ 1,000 | 1,072,000 | ||||
Exercise of stock options, shares | 10,000 | ||||||
Exercise of stock options, amount | 20,000 | 20,000 | |||||
Vesting of restricted stock units, shares | 138,327 | ||||||
Conversion of Series B Preferred into common stock, shares | 2,155,594 | ||||||
Conversion of Series B Preferred into common stock, amount | 6,165,000 | 6,165,000 | |||||
Classification of Preferred C to Mezzanine Equity, shares | (6,226,370) | ||||||
Classification of Preferred C to Mezzanine Equity, amount | (12,684,000) | (18,940,000) | 6,256,000 | ||||
Deemed dividend in connection with reclass of warrants to Derivative Liability | (40,442,000) | (7,601,000) | (32,841,000) | ||||
Other, shares | (3,000) | ||||||
Balance, amount at Jun. 30, 2022 | 7,238,000 | $ 20,000 | 182,483,000 | (32,000) | (175,233,000) | ||
Balance, shares at Jun. 30, 2022 | 1,177,023 | 206,082,652 | |||||
Stock-based compensation expense | 7,825,000 | 7,825,000 | |||||
Restricted stock units expense | 23,000 | 23,000 | |||||
Exercise of warrants, shares | 0 | 137,803 | |||||
Exercise of warrants, amount | 50,000 | 50,000 | |||||
Exercise of stock options, shares | 261,959 | ||||||
Exercise of stock options, amount | 144,000 | 144,000 | |||||
Declaration of dividends | (302,000) | (302,000) | |||||
Other | (58,000) | (58,000) | |||||
Net income (loss) | 14,406,000 | 32,000 | 14,374,000 | ||||
Balance, amount at Sep. 30, 2022 | 29,326,000 | $ 20,000 | 190,525,000 | $ 0 | (161,219,000) | ||
Balance, shares at Sep. 30, 2022 | 1,177,023,000 | 206,482,414,000 | |||||
Stock-based compensation expense | 7,041,000 | 7,041,000 | |||||
Restricted stock units expense | 56,000 | 56,000 | |||||
Exercise of stock options, shares | 362,166,000 | ||||||
Exercise of stock options, amount | 199,000 | 199,000 | |||||
Declaration of dividends | (426,000) | (426,000) | |||||
Other | (5,000) | (5,000) | |||||
Net income (loss) | (11,941,000) | (11,941,000) | |||||
Balance, amount at Dec. 31, 2022 | $ 24,250,000 | $ 20,000 | $ 197,816,000 | $ (173,586,000) | |||
Balance, shares at Dec. 31, 2022 | 1,177,023,000 | 206,844,580,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (30,349) | $ (51,668) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization | 5,483 | 0 |
Depreciation | 894 | 529 |
Stock-based compensation | 35,449 | 30,623 |
Stock issued for services | 0 | 354 |
Change in fair value of derivative liabilities | (33,921) | 0 |
Amortization of debt discount | 9,346 | 3,056 |
Amortization of debt discount, related party | 0 | 95 |
Amortization of debt issue costs | 0 | 10 |
Loss on foreign currency exchange | 60 | 363 |
Loss on impairment | 797 | 18,116 |
Net loss (gain) from investments | 789 | (3,330) |
Other expense, net | 2,482 | (1,126) |
Change in deferred income taxes | (690) | (5,292) |
Changes in working capital requirements: | ||
Accounts receivable | 773 | 4,345 |
Deposits, prepaids and other current assets | (916) | 1,478 |
Other assets | (47) | 183 |
Costs in excess of billings | (1,278) | (2,222) |
Accounts payable | (9,411) | (4,198) |
Other current liabilities | (2,445) | 1,123 |
Deferred revenue | 6,724 | 4,746 |
Other comprehensive income | 0 | (93) |
Net cash (used in) operating activities | (11,370) | (2,908) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Acquisition of fixed assets | (239) | (1,355) |
Disposal of fixed assets | 0 | 910 |
Sale of intellectual property | 179 | 0 |
Purchase of marketable securities | (55,983) | (67,440) |
Sale of marketable securities | 57,980 | 66,681 |
Purchase of non-marketable securities | (100) | |
Acquisition of ANS | (363) | (12,948) |
Acquisition of EV Depot | (1,231) | |
Acquisition of BW | 2,459 | 13,500 |
Cash acquired in acquisitions | 104 | 2,785 |
Net cash provided by (use in) investing activities | (2,012) | (24,967) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Cash receipts from issuance of notes payable | 0 | 23,333 |
Cash receipts from issuance of convertible notes payable | 0 | 5,000 |
Proceeds from sale of common stock | 10,000 | |
Proceeds from sale of Series C preferred stock | 10,845 | 6,667 |
Proceeds from exercise of warrants | 1,122 | 0 |
Proceeds from exercise of stock options | 363 | 0 |
Draws from revolving line of credit, net | 3,126 | 113 |
Employee taxes paid for stock-based compensation | (434) | 0 |
Cash paid for contingent liability | (61) | |
Payment on financing lease | (167) | (133) |
Payment of dividends | (1,177) | |
Redemption of Series B preferred stock | (685) | |
Net cash provided by financing activities | 22,993 | 34,919 |
Foreign currency adjustment | (126) | (435) |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 9,485 | 6,609 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 18,238 | 11,629 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | 27,723 | 18,238 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest expense | 2,695 | 965 |
Cash paid for income taxes | 786 | |
Non-cash investing and financing activities: | ||
Issuance of Series B Preferred Stock for acquisition | 6,850 | |
Issuance of common stock for acquisition | $ 17,530 | |
Debt discount associated with promissory notes | $ 7,717 |
Nature of operations
Nature of operations | 12 Months Ended |
Dec. 31, 2022 | |
Nature of operations | |
Nature Of Operations | Note 1 Nature of operations Charge Enterprises, Inc. (“Charge Enterprises” or the “Company”, formerly known as “Transworld Holdings, Inc.” and “GoIP Global, Inc.”) was incorporated on May 8, 2003 as E Education Network, Inc. (“EEN”) under the laws of the State of Nevada. On August 10, 2005, the Company changed its name from EEN to GoIP Global, Inc. On December 28, 2017, the Company was redomiciled in Colorado. On April 30, 2020, the Company entered into a Share Exchange Agreement with TransWorld Enterprises Inc. (“TW”), a Delaware Corporation (the “TW Share Exchange Agreement”). As part of the TW Share Exchange Agreement, the Company agreed to issue 1,000,000 shares of Series D Preferred Stock (“Series D Preferred Stock”) and 1,000,000 shares of Series F Preferred Stock (“Series F Preferred Stock”) in exchange for all the equity interest of TW. On August 7, 2020, the Company changed its name from GoIP Global, Inc. to Transworld Holdings, Inc. On October 1, 2020, the Company was redomiciled in Delaware and all previously designated series of preferred stock were terminated. On January 26, 2021, the Company changed its name from Transworld Holdings, Inc. to Charge Enterprises, Inc. Charge Enterprises, Inc. is an electrical, broadband and electric vehicle (“EV”) charging infrastructure company that provides clients with end-to-end project management services, from advising, designing, engineering, acquiring and installing equipment, to monitoring, servicing, and maintenance. Our vision is to be a leader in enabling the next wave of transportation and connectivity. By building, designing, and operating seamless infrastructure for EVs and high-speed broadband, the Company aims to create a future where transportation is clean, efficient, and connected. The Company has two operating segments: · Infrastructure, which has a primary focus on EV charging (“EVC”), broadband, including cell tower, small cell, and in-building applications, and electrical contracting services. · Telecommunications, which provides connection of voice calls and data to global carriers. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of significant accounting policies | |
Summary Of Significant Accounting Policies | Note 2 Summary of significant accounting policies Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting standards generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it intends to take advantage of certain exemptions from various reporting requirements. Principles of Consolidation Use of Estimates Segments egment Reporting The Company operates under two reportable business segments for which segment disclosures are consistent with how the chief operating decision maker evaluates the results of the Company and measures performance and determines the allocation of resources. The Company’s reportable segments meet the definition of operating segments and do not include the aggregation of multiple operating segments. The Company’s reportable segments are Infrastructure and Telecommunications. Nextridge Inc. and its wholly owned subsidiary, Advanced Network Solutions (collectively referred to as “ANS”), B W Electrical Services, LLC (“BW”), EV Group Holdings LLC (“EV Depot”) and Get Charged Inc. (“Get Charged”) are included in Infrastructure. Our PTGi International Carrier Services, Inc. (“PTGi”) subsidiary is included in Telecommunications. Revenue Recognition The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer, in an amount that reflects the consideration it expects to be entitled to in exchange for those products or services. The Company evaluates when it is appropriate to recognize revenues based on the gross amount invoiced to the customer or the net amount retained by the Company if a third party is involved. Revenue is recognized when or as performance obligations under the terms of a contract with customers are satisfied. For Telecommunications, revenue recognition typically occurs at the point in time that calls are completed. For Infrastructure, revenue recognition typically occurs over time through the contract term. A contract liability for deferred revenue is recorded when consideration is received or is unconditionally due from a customer prior to transferring control of goods or services to the customer under the terms of a contract. Deferred revenue balances typically result from advance payments received from customers for contracts or from billings in excess of revenue recognized on services arrangements. Costs in excess of billing represents when revenues are recognized in advance of invoice issuance. These assets are presented separately on the balance sheet and are converted to accounts receivable once the Company’s right to the consideration becomes unconditional, which varies by contract but is generally based on achieving certain acceptance milestones. The Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset would be one year or less. Infrastructure Due to the nature of the Company’s performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontracts, and the availability and timing of funding from the customer, among other variables. As a significant change in one or more of these estimates could affect the profitability of contracts, the Company reviews and updates contract-related estimates regularly through a review process in which management reviews the progress and execution of performance obligations and the estimated cost at completion. As part of this process, management reviews information including, but not limited to, any outstanding key contract matter, progress towards completion and the related program schedule and the related changes in estimates of revenues and costs. The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes a provision for the entire loss in the period it is identified. The nature of the Company’s contracts gives rise to several types of variable consideration, including claims and unpriced change orders. The Company recognizes revenue for variable consideration when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount of revenue to be recognized on variable consideration, using the expected value or the most likely amount method, whichever is expected to better predict the amount. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on assessments of legal enforceability, performance, and all information that is reasonably available to the Company. Telecommunications The Company’s performance obligations include the routing of voice, data and Short Message Services (“SMS”) to carriers and mobile network operators globally. The Company has contractual relationships with services providers within Asia, Europe, the Middle East, Africa and North and South America. The Company provides customers with internet-protocol-based and time-division multiplexing access for the transport of long-distance voice and data minutes. Refer to Note 4, Revenue, for additional information on the Company’s revenue recognition. Stock-Based Compensation The Company uses the Black-Scholes-Merton (“BSM”) valuation technique to calculate the grant date fair values for stock options. The BSM valuation inputs include the option exercise price, the fair market value price of the Company’s common stock, expected term, expected volatility, expected dividend yield and risk-free interest rate. The fair value of restricted stock units (“RSUs”) is determined using the closing price of the Company’s common stock on the grant date. The Company’s accounting policy for recognizing stock-based compensation expense is based on the graded vesting attribution method. The Company does not apply a forfeiture rate to unvested awards and accounts for forfeitures in the period they occur. The Company records deferred tax assets related to compensation expense for awards that are expected to result in future tax deductions for the Company, based on the amount of compensation cost recognized and the Company’s statutory tax rate in the jurisdiction in which it expects to receive a deduction. Differences between the deferred tax assets recognized for financial reporting purposes and actual tax deductions reported on the Company’s income tax return are recorded in the Consolidated Statements of Operations within income tax (expense) benefit. The Company also uses the simplified method in developing an estimate of the expected term of stock options. Expected volatility is based on a blend of the Company’s historic stock price volatility and the historic volatility of a peer group of publicly traded companies. Changes in these assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require judgment to develop. Refer to Note 14, Equity, for additional information on the Company’s stock-based compensation. Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents consists primarily of amounts held on deposit with financial institutions. From time to time, the Company may invest in cash equivalents, which consists of investments in immediately available money market accounts and all highly liquid debt instruments with initial maturities of three months or less. The Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. Restricted cash balances consist of amounts that the Company may be restricted in its ability to access or amounts that are reserved for a specific purpose and therefore not available for immediate or general business use. As of December 31, 2022, and December 31, 2021, the Company had restricted cash of $0.9 million and $0, respectively. These funds represent balances that have been reserved for a Directors and Officers insurance policy. Fair Value Measurements and Fair Value of Financial Instruments Accounting Standard Codification (“ASC”) Topic 820, Fair Value Measurements Level 1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2: Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3: Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information. ASC subtopic 825-10, Financial Instruments The Company follows ASC subtopic 820-10, Fair Value Measurements and Disclosures Property, plant and equipment Fixed Assets are carried at historical cost. Depreciation is calculated on the straight-line method over the estimated useful lives as follows: Computer hardware 3 - 5 years Computer software 3 years Equipment 2 - 7 years Furniture and fixtures 5 - 7 years Leasehold improvement Lesser of life of lease or asset life Vehicles 3 - 5 years Goodwill and Other Intangible Assets Goodwill is assigned to reporting units based on the difference between the purchase price as allocated to the reporting units and the estimated fair value of the identified net assets acquired as allocated to the reporting units. Purchased intangible assets with finite lives are carried at their estimated fair values at the time of acquisition less accumulated amortization and any impairment charges. Amortization is recognized on a straight-line basis over the estimated useful lives of the respective assets, which approximates the pattern that the economic benefits are realized by the Company. Asset Impairments Goodwill is tested for impairment annually as of October 1 or at other times if events have occurred or circumstances exist that indicate the carrying value of the reporting unit may exceed its fair value. Goodwill is not amortized for book purposes. It may be, however, amortized for tax purposes. The Company reviews its goodwill for impairment at least annually. At the time of each review, if the fair value is less than the carrying value of the reporting unit, then a charge is recorded to the results of operations. For goodwill, the Company uses qualitative and quantitative approaches when testing goodwill for impairment. The Company performs a qualitative evaluation of events and circumstances impacting each reporting unit to determine the likelihood of goodwill impairment. Based on that qualitative evaluation, if the Company determines it is more likely than not that the fair value of a reporting unit exceeds its carrying amount, no further evaluation is necessary. Otherwise, the Company performs a quantitative goodwill impairment test. The Company performs quantitative goodwill impairment tests for reporting units at least once every three years. Property, plant and equipment, intangible assets with finite lives and right of use assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable, based on the undiscounted cash flows expected to be derived from the use and ultimate disposition of the assets. Assets identified as impaired are adjusted to estimated fair value. Beneficial conversion features If the conversion features of conventional convertible debt provide for a rate of conversion that is below market value at issuance, this feature is characterized as a beneficial conversion feature (“BCF”). A BCF is recorded by the Company as a debt discount pursuant to ASC Topic 470-20 “ Debt with Conversion and Other Options Derivative Liabilities The Company evaluates convertible instruments, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for under ASC Topic 815, “ Derivatives and Hedging Income Taxes The Company has adopted ASC 740-10, Accounting for Income Taxes The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as a component of general and administrative expenses. Our federal tax return and any state tax returns are not currently under examination. The Company is subject to federal and state income tax audits from time to time that could result in proposed assessments. Management believes that the Company has appropriately accounted for income taxes for tax periods that are within the statutory period of limitations not previously audited and that are potentially open for examination by the taxing authorities. The Company cannot predict with certainty how any audits would be resolved and whether the Company will be required to make additional tax payments, which may include penalties and interest. The Company is subject to examination for the preceding three years. Leases The Company enters into operating lease contracts for buildings, properties, structures and other equipment. Arrangements are evaluated at inception to determine whether such arrangements contain a lease. Operating leases primarily include building lease contracts. Arrangements to lease building space consist primarily of the rental of office space, but may also include leases of other equipment, including automobiles. Operating leases are reflected on the Company’s consolidated balance sheet within the Operating lease right-of-use (“ROU”) asset line item and the related short-term and long-term liabilities are included within the Operating lease liability and Operating lease liability, non-current line items, respectively. Finance leases are reflected on the Company’s consolidated balance sheet within Finance lease right-of-use asset line item and the related short-term and long-term liabilities are included within the Finance lease liability and Finance lease liability, non-current line items. As an accounting policy election, the Company elected not to apply the recognition requirements to short-term leases for all underlying classes of assets. For these leases which have a term of twelve months or less at lease inception, the Company will recognize the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for these payments is incurred. ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at lease commencement date based on the present value of lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term. Repayments of the principal portion of the finance lease liabilities are classified within financing activities. Certain of the Company’s operating lease agreements include rental payments that are adjusted periodically for inflationary changes. Payments due to changes in inflationary adjustments are included within variable rent expense, which is accounted for separately from periodic straight-line lease expense. Certain of the Company’s leases provide options to extend the terms of the agreements. Generally, renewal periods are excluded from minimum lease payments when calculating the lease liabilities as, for most leases, the Company does not consider exercise of such options to be reasonably certain. Unless a renewal option is considered reasonably assured, the optional terms and related payments are not included within the lease liability. For those leases for which renewal periods are included in calculating minimum lease liabilities, any adjustments resulting from changes in circumstances which result in the renewal options no longer being reasonably certain are accounted for as changes in estimates. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The implicit rate within the Company’s lease agreements is generally not determinable. As such, the Company uses the incremental borrowing rate (“IBR”) to determine the present value of lease payments at the commencement of the lease. The IBR is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment . When the Company decides to abandon a leased property before the expiration of the lease term, management assesses whether such property will be subleased. If it is determined that subleasing the property for the remaining lease term is reasonable, management estimates the fair value of the sublease payments to be received and compares the estimated fair value to the ROU asset. To the extent the estimated fair value is less than the net book value of the ROU asset, the Company records a non-cash impairment charge for the difference, and the remaining ROU asset is recorded ratably over the remaining lease term. If it is determined that subleasing the property for the remaining lease term is not reasonable (e.g., the remaining lease term is too short to reasonably expect the property to be subleased), amortization of the net book value of the ROU asset is accelerated and recognized as expense ratably from the decision date to the date the Company ceases use of the property. Advertising Costs Advertising costs are expensed in the period in which they are incurred and are reflected in general and administrative expense on the Consolidated Statements of Operations. Advertising expense was $0.8 million and $0.3 million for the years ended December 31, 2022 and 2021, respectively. Net Income (Loss) Per Share Basic income (loss) per share available to common stockholders is calculated using the weighted average number of common shares outstanding during the applicable period. Diluted net income (loss) per share available to common stockholders is calculated using the weighted average number of common shares outstanding plus the number of dilutive potential common shares outstanding during the applicable period. Dilutive potential common shares consist of the incremental common shares (i) issuable upon the vesting of outstanding restricted stock units and the exercise of outstanding stock options using the treasury stock method and (ii) issuable for non-participating preferred stock using the if-converted method. Our warrants and some of our preferred stock are considered participating securities pursuant to the two-class method. Dilutive potential common shares are excluded from the calculation of diluted net income (loss) per share available to common stockholders if their effect is antidilutive. The following potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders because their effect would have been antidilutive: Years Ended December 31, (in thousands) 2022 2021 Restricted stock units 196 65 Warrants 20,552 21,097 Stock options 48,986 34,740 Preferred stock 21,677 1,565 Convertible notes payable 24,847 43,832 Total 116,258 101,299 Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity . In October 2021, the FASB issued ASU No. 2021-08, Business Combinations - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers Reclassification |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair value measurements | |
Fair value measurements | Note 3 Fair value measurements Recurring Fair Value Measurements The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis: December 31, 2022 December 31, 2021 (in thousands) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets: Marketable securities (Note 5) $ 6,757 $ 9,619 Liabilities: Derivative liabilities (Note 11) $ 6,521 $ - Contingent consideration $ - $ - The Company has a contingent consideration liability of $3.5 million as of December 31, 2022 related to the Company’s acquisition of EV Group Holdings LLC (see Note 6, Business combinations), and its settlement is expected to occur in the first quarter of 2023. The contingency was based on the Company's average share price for the month ending December 31, 2022, and, as a result, the Company was able to determine that the average share price for the month ending December 31, 2022 will result in the Company issuing additional shares of common stock to the sellers. The contingent consideration liability is reflected in accrued liabilities on the consolidated balance sheet, and the remeasurement is reflected in other income (expense), net on the consolidated statement of operations. Nonrecurring Fair Value Measurements The Company also has investments in non-marketable securities, which are primarily equity securities in a non-public company that do not have readily determinable fair values. Such investments are initially recorded at cost and adjusted to fair value on a nonrecurring basis through earnings for observable price changes in orderly transactions for identical or similar transactions of the same company (Level 2 of GAAP fair value hierarchy). Historical adjustments have not been material. The carrying amount of these equity securities is $0.2 million and $0.1 million as of December 31, 2022 and 2021, respectively, and is included in non-marketable securities on the consolidated balance sheet. Increases in the fair value of the non-marketable securities were $0.1 million and $0.0 million for the years ended December 31, 2022 and 2021, respectively, and are reflected in income (loss) from investments, net, on the consolidated statement of operations. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2022 | |
Revenue | |
Revenue | Note 4 Revenue Nature of Goods and Services Infrastructure Due to the nature of the Company’s performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontracts, and the availability and timing of funding from the customer, among other variables. As a significant change in one or more of these estimates could affect the profitability of contracts, the Company reviews and updates contract-related estimates regularly through a review process in which management reviews the progress and execution of performance obligations and the estimated cost at completion. As part of this process, management reviews information including, but not limited to, any outstanding key contract matter, progress towards completion and the related program schedule and the related changes in estimates of revenues and costs. The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes a provision for the entire loss in the period it is identified. The nature of the Company’s contracts gives rise to several types of variable consideration, including claims and unpriced change orders. The Company recognizes revenue for variable consideration when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount of revenue to be recognized on variable consideration, using the expected value or the most likely amount method, whichever is expected to better predict the amount. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on assessments of legal enforceability, performance, and all information that is reasonably available to the Company. Telecommunications Our telecommunications segment operates an extensive network of direct routes and offers premium voice communication services for carrying a mix of business, residential and carrier long-distance traffic, data and transit traffic. Telecommunications has both a customer and vendor relationship with most parties. Telecommunications sells the customer routing services through the Telecommunications supplier routes on incoming calls and then Telecommunications purchases routing services from other vendor’s supplier routes in order to complete the call. Revenue is earned based on the number of minutes during a call multiplied by the price per minute and is recorded upon completion of a call. Incomplete calls are not revenues earned by Telecommunications and may occur as a result of technical issues or because the customer’s credit limit was exceeded and thus the customer routing of traffic was prevented. Revenue for a period is calculated from information received through Telecommunication’s billing software, such as minutes and market rates. Telecommunications evaluates gross versus net revenue recognition for each of its contractual arrangements by assessing indicators of control and significant influence to determine whether Telecommunications acts as a principal (i.e. gross recognition) or an agent (i.e. net recognition). Telecommunications has determined that it acts as a principal for all of its performance obligations in connection with all revenue earned as Telecommunications may accept or reject calls, determines the routing decision and routing vendor and has the risk of financial loss on revenues from customers and amounts owed to the vendors. Net revenue represents gross revenue, net of allowance for doubtful accounts receivable, service credits and service adjustments. Cost of revenue includes network costs that consist of access, transport and termination costs. The majority of Telecommunications’ cost of revenue is variable, primarily based upon minutes of use, with transmission and termination costs being the most significant expense. The amount of consideration the Company receives and revenue it recognizes is fixed based upon contractually agreed upon rates. The Company recognizes revenue at a point in time when the voice, data and SMS are routed and the performance obligations are satisfied. Contract Balances The following table provides information about receivables, costs in excess of billing, and deferred revenue from contracts with customers. Accounts receivable in the table below represent receivables that are generated from contracts with customers. (in thousands) 2022 2021 Receivables included in “Accounts receivable net of allowances” $ 72,405 $ 73,334 Cost in excess of billings 6,090 4,812 Deferred revenue - current 13,741 7,018 Changes in Contract Balances The timing of revenue recognition, billings and cash collections results in accounts receivable, and customer advances and unearned revenue on the Company’s consolidated balance sheets. At times, the Company receives advance payments or deposits from its customers before revenue is recognized, resulting in contract liabilities. The contract liabilities primarily relate to the advance consideration received from customers on certain contracts. For these contracts, revenue is recognized in a manner that is consistent with the satisfaction of the underlying performance obligations. The contract liabilities are reported on the consolidated balance sheets on a contract-by-contract basis at the end of each respective reporting period within the deferred revenue line item. Significant changes in the balance of contract liabilities during the period are as follows: (in thousands) Balance at December 31, 2021 $ 7,018 Revenue recognized during the period that was included in the beginning balance (6,484 ) Additions, net of revenue recognized during the period 13,207 Balance at December 31, 2022 $ 13,741 Disaggregation of Revenue The following table presents the Company’s revenues disaggregated by segment: Years Ended December 31, (in thousands) 2022 2021 Revenue: Infrastructure $ 105,523 $ 24,251 Telecommunications 592,310 452,767 Total $ 697,833 $ 477,018 |
Marketable securities and other
Marketable securities and other investments | 12 Months Ended |
Dec. 31, 2022 | |
Marketable securities and other investments | |
Marketable Securities And Other Investments | Note 5 Marketable securities and other investments Our marketable securities are stated at fair value in accordance with ASC Topic 321, Investments-Equity Securities The fair value of these marketable securities is as follows: (in thousands) December 31, 2022 December 31, 2021 Brokerage Account $ 6,757 $ 9,588 Other Securities - 31 Total Fair Value $ 6,757 $ 9,619 During 2022, the Company recognized net losses of $0.8 million, on marketable securities and other investments which included $0.2 million of realized losses and $0.7 million of unrealized losses on marketable securities, offset by $0.1 million mark to market gain on non-marketable securities. During 2021, the Company recognized net gains of $3.3 million, which included $0.9 million of unrealized losses and $4.2 million of realized gains. Changes in the fair value of the marketable securities are reflected in income (loss) from investments, net, on the consolidated statement of operations. |
Business combinations
Business combinations | 12 Months Ended |
Dec. 31, 2022 | |
Business combinations | |
Business combinations | Note 6 Business combinations EV Group Holdings LLC Charge Infrastructure, Inc. entered into an agreement and plan of merger dated January 14, 2022 with the members of EV Depot pursuant to which the Company agreed to purchase all the issued and outstanding units of EV Depot for an aggregate purchase price of $18.8 million (the “EV Depot Acquisition”). $17.5 million of the aggregate purchase price payable to the shareholders of EV Depot payable through the issuance of 5,201,863 shares of common stock. The EV Depot Acquisition agreement provides protection to the sellers, such that if the average price of Charge’s common stock for the month ending December 31, 2022 is less than the per share price of Charge’s common stock determined at closing, the Company will increase the number of shares of common stock issued. The Company recorded this as a contingent consideration liability at the acquisition date, and its balance was $3.5 million as of December 31, 2022 (see Note 3 Fair value measurements). The EV Depot Acquisition agreement also provides the Company with gross margin protection, such that if the 2022 gross margin of EV Depot falls below target levels, the Company will reduce the number of shares of common stock to be issued to EV Depot. The Company recorded this as a contingent consideration asset at the acquisition date, and its balance was $0.8 million as of December 31, 2022. The contingent consideration matter is expected to be settled in the first quarter of 2023. The EV Depot Acquisition closed on January 14, 2022. The Company analyzed the EV Depot Acquisition under applicable guidance and determined that it should be accounted for as a business combination. The following tables summarize the total consideration as well as the final fair values of the net assets acquired and liabilities assumed as of the acquisition date: (in thousands, except shares) Preliminary Estimates Measurement Period Adjustments Final Cash $ 1,231 $ - $ 1,231 Accrued expenses 19 - 19 Contingent consideration liability, net of $72 contingent consideration asset 7 - 7 Common stock (5,201,863 shares) 17,530 - 17,530 Total consideration $ 18,787 $ - $ 18,787 Fair values of identifiable net assets and liabilities (in thousands): Assets: Cash $ 104 $ - $ 104 Deposits, prepaids, and other current assets, net 5 - 5 Non-current assets 391 - 391 Operating lease right-of-use asset 2,017 479 2,496 Goodwill 18,498 (11,768 ) 6,730 Intangible Assets, net - 15,921 15,921 Total assets 21,015 4,632 25,647 Liabilities: Accrued liabilities 44 - 44 Deferred revenue 167 - 167 Operating lease liability 2,017 - 2,017 Deferred tax liability - 4,632 4,632 Total liabilities 2,228 4,632 6,860 Total fair value of identifiable net assets and liabilities $ 18,787 $ - $ 18,787 Management believes that this acquisition provides the Company with an opportunity to benefit from customer relationships, technical knowledge, and trade secrets. The goodwill is not deductible for income tax purposes. The measurement period adjustments related to the establishment of a customer relationship intangible asset of $11.3 million (estimated useful life of 15 years), a non-compete agreement intangible asset of $3.6 million (estimated useful life of 4 years), an off-market favorable leases intangible asset of $1.0 million (estimated useful life of 1 year), an operating lease right-of-use asset of $0.5 million, and the related deferred tax liabilities. The inclusion of the EV Depot acquisition in our consolidated financial statements is not deemed material with respect to the requirement to provide pro-forma results of operations. As such, pro-forma information is not presented. B W Electrical Services LLC Our wholly owned subsidiary, Charge Infrastructure Holdings Inc. formerly, Charge Infrastructure, Inc., entered into a unit purchase agreement dated December 22, 2021 with the members of BW pursuant to which the Company agreed to purchase all the issued and outstanding units of BW for an aggregate purchase price of $18.0 million (the “BW Acquisition”). Approximately $4.5 million of the aggregate purchase price payable to the shareholders of BW was payable settled the issuance of 1,285,714 shares of common stock. The BW Acquisition closed on December 27, 2021. The Company analyzed the BW Acquisition under applicable guidance and determined that it should be accounted for as a business combination. The following tables summarize the total consideration as well as the final fair values of the net assets acquired, and liabilities assumed as of the acquisition date: (in thousands, except shares) Preliminary Estimates Measurement Period Adjustments Final Cash $ 13,500 $ 2,450 $ 15,950 Common stock (1,285,714 shares) 4,539 - 4,539 Total consideration $ 18,039 $ 2,450 $ 20,489 Fair values of identifiable net assets and liabilities (in thousands): Assets: Cash $ 3,068 $ - $ 3,068 Accounts receivable 7,033 - 7,033 Deposits, prepaids, and other current assets, net 93 - 93 Investments in marketable securities 2,280 - 2,280 Cost in excess of billings 970 - 970 Property, plant, and equipment 105 - 105 Operating lease right-of-use asset 1,071 - 1,071 Goodwill 11,730 (11,578 ) 152 Intangible Assets, net - 11,569 11,569 Total assets 26,350 (9 ) 26,341 Liabilities: Accounts payable 1,306 - 1,306 Accrued liabilities 1,663 (459 ) 1,204 Deferred revenue 2,271 - 2,271 Operating lease liability 1,071 - 1,071 Notes payable 2,000 (2,000 ) - Total liabilities 8,311 (2,459 ) 5,852 Total fair value of identifiable net assets and liabilities $ 18,039 $ 2,450 $ 20,489 Management believes that this acquisition provides the Company with an opportunity to benefit from customer relationships, technical knowledge, and trade secrets. The goodwill is deductible for income tax purposes. The gross contractual amount of accounts receivable, including cost in excess of billings, as of the acquisition date has been substantially collected as of December 31, 2022. The measurement period adjustments related to the establishment of a customer relationship intangible asset of $7.6 million (estimated useful life of 15 years), a contract backlog intangible asset of $3.3 million (estimated useful life of 3 years), a brand intangible asset of $0.6 million (estimated useful life of 15 years), and a non-compete agreement intangible asset of $0.1 million (estimated useful life of 4 years). In addition, the Company reimbursed the shareholders of BW $2.0 million for a loan from the Small Business Administration (see Note 10 Debt for additional information) and $0.5 million for the settlement of a pre-close pension plan liability. The inclusion of the BW acquisition in our consolidated financial statements is not deemed material with respect to the requirement to provide pro-forma results of operations. As such, pro-forma information is not presented. ANS Charge Infrastructure Inc. entered into a securities purchase agreement dated May 7, 2021 with the shareholders of ANS, pursuant to which the Company agreed to purchase all the issued and outstanding shares of ANS for an aggregate purchase price of $19.8 million (the “ANS Acquisition”). Approximately $6.9 million of the aggregate purchase price payable to the shareholders of ANS was settled through the issuance of 2,395,105 shares of our Series B preferred stock. The acquisition closed on May 21, 2021. The Company analyzed the ANS Acquisition under applicable guidance and determined that it should be accounted for as a business combination. The following tables summarize the total consideration as well as the final fair values of the net assets acquired and liabilities assumed as of the acquisition date: (in thousands, except shares) Preliminary Estimates Measurement Period Adjustments Final Cash $ 12,948 $ 363 $ 13,311 Series B preferred stock (2,395,105 shares) 6,850 - 6,850 Total consideration $ 19,798 $ 363 $ 20,161 Fair values of identifiable net assets and liabilities (in thousands): Assets: Cash $ - $ - $ - Accounts receivable 6,492 - 6,492 Inventory 171 - 171 Deposits and prepaids 512 - 512 Accrued revenue 1,620 - 1,620 Other current assets 2,289 - 2,289 Property, plant, and equipment 680 - 680 Finance lease asset 229 - 229 Operating lease right-of-use asset 603 - 603 Goodwill 13,418 (8,400 ) 5,018 Intangible Assets, net - 11,925 11,925 Total assets 26,014 3,525 29,539 Liabilities: Accounts payable 2,638 - 2,638 Accrued liabilities 1,014 135 1,149 Line of credit 1,785 - 1,785 Net deferred tax liability - 3,027 3,027 Finance lease liability 176 - 176 Operating lease liability 603 - 603 Total liabilities 6,216 3,162 9,378 Total fair value of identifiable net assets and liabilities $ 19,798 $ 363 $ 20,161 Management believes that this acquisition provides the Company with an opportunity to benefit from customer relationships, technical knowledge, and trade secrets. The goodwill is not deductible for income tax purposes. The gross contractual amount of accounts receivable, including accrued revenue, as of the acquisition date has been substantially collected as of December 31, 2022. The measurement period adjustments primarily related to the establishment of a customer relationship intangible asset (estimated useful life of 15 years) and related deferred tax liability. The inclusion of the ANS acquisition in our consolidated financial statements is not deemed material with respect to the requirement to provide pro-forma results of operations. As such, pro-forma information is not presented. |
Goodwill and intangible assets
Goodwill and intangible assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and intangible assets | |
Goodwill and intangible assets | Note 7 Goodwill and intangible assets The following table presents goodwill by reportable segment: (in thousands) Infrastructure Telecommunications Total Goodwill, gross, at December 31, 2020 $ 27,327 $ 549 $ 27,876 Additions 25,148 - 25,148 Measurement period adjustments 135 223 358 Goodwill, gross, at December 31, 2021 52,610 772 53,382 Addition 18,497 - 18,497 Measurement period adjustments (31,880 ) - (31,880 ) Goodwill, gross, at December 31, 2022 $ 39,227 $ 772 $ 39,999 Accumulated impairment at December 31, 2020 $ (10,700 ) $ - $ (10,700 ) Impairment (16,627 ) - (16,627 ) Accumulated impairment at December 31, 2021 (27,327 ) - (27,327 ) Impairment - - - Accumulated impairment at December 31, 2022 $ (27,327 ) $ - $ (27,327 ) Goodwill, net, at December 31, 2021 $ 25,283 $ 772 $ 26,055 Goodwill, net, at December 31, 2022 $ 11,900 $ 772 $ 12,672 In the Telecommunications segment, the 2021 measurement period adjustment was a final measurement period adjustment related to the October 2020 acquisition of PTGi. In the Infrastructure segment, the 2021 additions related to the acquisitions of ANS and BW, and the 2022 addition related to the acquisition of EV Depot. The 2021 measurement period adjustment related to the acquisition of ANS, and the 2022 measurement period adjustments related to the acquisitions of ANS, BW, and EV Depot (see Note 6, Business combinations for additional information). The 2021 impairment in the Infrastructure segment related to GetCharged. Based on changes in management’s focus related to this business, the Company determined a triggering event occurred and performed an impairment analysis, which resulted in the recording of an impairment for the remaining balance of goodwill related to GetCharged. Methodology - PTGi, ANS and BW Reporting Units During the fourth quarter of 2022, the Company completed a qualitative impairment assessment for goodwill attributable to its PTGi, ANS and BW reporting units and determined it was more likely than not that the fair value of the reporting units exceeded their respective carrying amounts. Accordingly, no quantitative impairment assessment was conducted and no goodwill impairment loss was recognized. Methodology - EV Depot Reporting Unit The Company uses an income approach in calculating the fair value of the goodwill attributable to the Infrastructure segment. This approach utilizes a discounted cash flow method by projecting the segment’s income over a specified time period and capitalizing at an appropriate market rate to arrive an indication of the most probable selling price. Potential impairment is identified by comparing the fair value of the reporting unit to its carrying value, including goodwill. Cash flow projections for the reporting unit include significant judgments and assumptions relating to projected operating profit margin, including revenue and expense growth rates and the discount rate. Management believes this approach is commonly used and is an appropriate methodology for valuing the Company. Factors contributing to the determination of the Company’s operating performance include historical performance and/or management’s estimates of future performance. Assumptions and Results - EV Depot Estimates and Assumptions Fourth Quarter 2022 Discount Rate 15.5 % Forecasted revenue growth rates 3% to 42 % Terminal value growth rate 3 % As a result of this impairment assessment, the Company determined that the fair value of the EV Depot reporting unit was greater than the amount reflected in the balance sheet and, accordingly, no impairment was recorded. The Company believes it has made reasonable estimates and assumptions to calculate the fair value of its goodwill attributable to the EV Depot reporting unit. If actual market conditions are less favorable than those projected by the Company, or if events occur or circumstances change that would reduce the fair value of the Company’s goodwill below the amount reflected in the consolidated balance sheet, the Company may be required to conduct an interim test and possibly recognize impairment charges, which may be material, in future periods. The following is included in intangible assets, net on the consolidated balance sheet: December 31, 2022 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 30,849 $ (2,489 ) $ 28,360 Backlog 3,322 (1,107 ) 2,215 Non-compete agreements 3,729 (895 ) 2,834 Off-market favorable leases 955 (955 ) - Brand 560 (37 ) 523 Total $ 39,415 $ (5,483 ) $ 33,932 The intangible assets were measurement period adjustments to goodwill (see Note 6, Business combinations for additional information). For EV Depot and BW, intangible assets were recorded in the fourth quarter of 2022 along with amortization expense of $2.5 million and $1.7 million, respectively, upon finalization of purchase accounting. For ANS, intangible assets were recorded in the second quarter of 2022 along with amortization expense of $0.9 million upon finalization of purchase accounting. Amortization expense of $5.5 million is included within depreciation and amortization expense for the year ended December 31, 2022. Estimated future amortization expense is as follows: (in thousands) 2023 $ 4,134 2024 4,134 2025 3,026 2026 2,132 2027 2,094 Thereafter 18,412 Total $ 33,932 Intangible assets are being amortized on a straight-line basis. The weighted average amortization periods for intangible assets are as follows: 15 years for customer relationships, 3 years for backlog, 4 years for non-compete agreements, 1 year for off-market favorable leases, 15 years for brand, and 12.7 years for total definite-lived intangible assets. |
Property, plant, and equipment
Property, plant, and equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, plant, and equipment | |
Property, plant, and equipment | Note 8 Property, plant, and equipment Property, plant and equipment consisted of the following: (in thousands) December 31, 2022 December 31, 2021 Equipment $ 5,214 $ 5,924 Computer hardware 468 468 Computer software 37 37 Furniture and fixtures 112 106 Vehicles 2,794 2,831 Leasehold improvements 6 6 8,631 9,372 Less: accumulated depreciation (7,899 ) (7,360 ) Property, plant, and equipment, net $ 732 $ 2,012 Depreciation expense was $0.9 million and $0.5 million for the years ended December 31, 2022 and 2021, respectively. |
Related party
Related party | 12 Months Ended |
Dec. 31, 2022 | |
Related party | |
Related Party | Note 9 Related party During 2022, the Company entered into a Special Advisor Agreement with KORR Acquisitions Group, Inc., a stockholder of the Company. The agreement includes an upfront payment of $0.5 million and an annual advisory fee of $0.3 million. Mr. Orr, the former Chairman of the Company, has sole voting and dispositive power over the shares held by KORR Acquisitions Group, Inc and its affiliates. During 2021, the Company paid $0.3 million to KORR Acquisitions Group, Inc. related to successful acquisition efforts. During 2021, the Company granted Mr. Deutsch, a Board member of the Company, options to acquire 1,500,000 shares of common stock, at an exercise price of $2.00, for services rendered related to financial consulting. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Debt | Note 10 Debt Long-term debt was comprised of the following as of: (in thousands) December 31, 2022 December 31, 2021 Convertible Notes Payable Issued on May 8, 2020 $ - $ 3,000 Issued on November 3, 2020 - 3,889 Issued on May 19, 2021 - 5,610 Issued on April 30, 2021 - 66 Total Face Value of Convertible Notes Payable - 12,565 Less: Unamortized Discount - (5,389 ) Net Carrying Value of Convertible Notes Payable - 7,176 Line of Credit ANS Line of Credit 5,024 1,898 Total Line of Credit 5,024 1,898 Notes Payable Paycheck Protection Program - 2,000 Issued on May 19, 2021 11,860 11,860 Issued on December 17, 2021 15,926 15,926 Total Face Value of Notes Payable 27,786 29,786 Less: Unamortized Discount (3,630 ) (3,699 ) Net Carrying Value of Notes Payable 24,156 26,087 Total debt before deferred financing costs 29,180 35,161 Current amount of Convertible Notes Payable - 2,700 Current amount of Notes Payable 24,156 - Current amount of Line of Credit 5,024 1,898 Total current portion of long-term debt 29,180 4,598 Total long-term debt, net of current portion $ - $ 30,563 Convertible notes payable May 2020 Financing On May 8, 2020, the Company entered into a securities purchase agreement with certain institutional investors (collectively, the “May 2020 Investors”) pursuant to which the Company issued convertible notes in an aggregate principal amount of $3.0 million for an aggregate purchase price of $2.7 million (the “May 2020 Convertible Notes”). In connection with the issuance of the May 2020 Convertible Notes, the Company issued to the May 2020 Investors warrants to purchase an aggregate of 7,600,000 shares of common stock (collectively, the “Warrants”) and 7.5 shares of series G convertible preferred stock (the “Series G Preferred Stock”). The May 2020 Convertible Notes’ maturity date of May 8, 2021, was extended to May 8, 2023, unless earlier converted. The May 2020 Convertible Notes accrued interest at a rate of 8% per annum, subject to increase to 20% per annum upon and during the occurrence of an event of default. Interest was payable in cash on a quarterly basis beginning on December 31, 2020. The May 2020 Convertible Notes were convertible at any time, at the holder’s option, into shares of the Company’s common stock at an initial conversion price of $0.25 per share, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%) and subject to a decrease in the conversion price to the greater of (i) $0.01 or (ii) 75% of the volume-weighted average price (“VWAP”) of the common stock for the immediately preceding five (5) Trading Days on the date of conversion. The conversion price was also subject to adjustment due to certain events, including stock dividends, and stock splits. The May 2020 Convertible Notes were able to be redeemed by the Company, in its sole discretion, in an amount equal to 110% of the principal amount, interest and any other amounts owed under the May 2020 Convertible Notes, subject to certain limitations. November 2020 Financing On November 3, 2020, the Company entered into a securities purchase agreement with funds affiliated with Arena Investors LP (the “November 2020 Investors”) pursuant to which it issued convertible notes in an aggregate principal amount of $3.9 million for an aggregate purchase price of $3.5 million (the “November 2020 Convertible Notes”). In connection with the issuance of the November 2020 Convertible Notes, the Company issued to the November 2020 Investors 903,226 shares of common stock. The November 2020 Convertible Notes were convertible at any time, at the holder’s option, into shares of the Company’s common stock at a conversion price of $0.25 per share. The November 2020 Convertible Notes’ maturity was extended from November 3, 2023, to November 3, 2024. The November 2020 Convertible Notes accrued interest at a rate of 8% per annum. May 2021 Financing On May 19, 2021, the Company entered into a securities purchase agreement with funds affiliated with Arena Investors LP (the “May 2021 Investors”) pursuant to which it issued convertible notes in an aggregate principal amount of $5.6 million for an aggregate purchase price of $5.0 million (collectively, the “May 2021 Convertible Notes” and together with the May 2020 Convertible Notes and the November 2020 Convertible Notes, the “Convertible Notes”). In connection with the issuance of the May 2021 Convertible Notes, the Company issued to the May 2021 Investors warrants to acquire 1,870,000 shares of common stock. The May 2021 Convertible Notes were convertible at any time, at the holder’s option, into shares of the Company’s common stock at a conversion price of $3.00 per share. The May 2021 Convertible Notes were due to mature on May 19, 2024. The May 2021 Convertible Notes accrued interest at a rate of 8% per annum. Conversion of Convertible Notes to Preferred Stock In the second quarter of 2022, the Convertible Notes were exchanged for 1,177,023 shares of Series D preferred stock (“Series D Preferred Stock”). As a result of this exchange, the Company has no Convertible Notes Payable outstanding at December 31, 2022. Refer to Note 14, Equity, for additional information. April 30, 2020 Sutton Global Note On April 30, 2020, the former CEO converted his payable into a convertible note with a face value of $0.3 million (the “April 2020 Convertible Note”). The April 2020 Convertible Note had a coupon rate of 6% and a maturity date of December 31, 2021. The April 2020 Convertible note was convertible at a rate of $.0005 per share. Since the April 2020 Convertible Note added a conversion option, it resulted in a debt modification requiring the Company to record a loss on modification of debt in the amount of $0.1 million. On March 25, 2021, Sutton Global Associates converted $0.2 million in principal plus accrued interest into 644,499 shares of the Company common stock. The remaining balance of the April 2020 Convertible note was subsequently sold to an unrelated party and converted into 319,950 shares of the Company common stock. The Company has accounted for all Convertible Notes payable as a financing transaction, wherein the net proceeds that were received were allocated to the financial instrument issued. Prior to making the accounting allocation, the Company evaluated the Convertible Notes under ASC 815, which generally requires the analysis of embedded terms and features that have characteristics of derivatives to be evaluated for bifurcation and separate accounting in instances where their economic risks and characteristics are not clearly and closely related to the risks of the host contract. None of the terms and features embedded in the notes required bifurcation and liability classification. The Company analyzed the detachable warrants under ASC 480 and ASC 815. The warrants did not fall under the guidance of ASC 480. After analyzing the warrants under ASC 815, it was determined that the warrants met all of the requirements for equity classification under guidance of ASC 815-40-25-1 through 6. Convertible notes payable, related parties The Company did not have any outstanding convertible notes payable to related parties as of December 31, 2022 and December 31, 2021. Interest expense and amortization of debt discount for the year ended December 31, 2021 was approximately $0.1 million in the aggregate. KORR Value Financing In May and June 2020, the Company entered into a securities purchase agreement with KORR Value LP, an entity controlled by Kenneth Orr, who was the Company’s Executive Chairman at that time, pursuant to which the Company issued convertible notes in an aggregate principal amount of $0.6 million for an aggregate purchase price of $0.5 million (collectively, the “KORR Notes”). In connection with the issuance of the KORR Notes, the Company issued to KORR Value LP warrants to purchase an aggregate of 1,151,515 shares of common stock (collectively, the “KORR Warrants”). On August 27, 2020, KORR Notes totaling approximately $0.3 million and 658,667 warrants were assigned to an unrelated party. On March 15, 2021, KORR Value LP converted approximately $0.3 million in principal plus accrued interest on the KORR Notes into 1,115,638 shares of the Company’s common stock. 9 Madison Inc. Financing On September 2, 2020, the Company entered into a securities purchase agreement with 9 Madison, Inc. (“9 Madison”), an entity controlled by Andrew Fox, the Company’s CEO, pursuant to which the Company issued a convertible note in the amount of $0.1 million for an aggregate purchase price of $0.1 million (the “Madison Notes”). The Madison Notes were convertible at the holder’s option at a conversion price of $0.25 per share. In connection with the issuance of the Madison Notes, the Company issued to 9 Madison warrants to purchase an aggregate of 440,000 shares of common stock. On March 15, 2021, 9 Madison converted approximately $0.1 million in principal plus accrued interest on the Madison Notes into 458,709 shares of the Company’s common stock. Line of credit Nextridge and ANS have a revolving $8.0 million line of credit (the “ANS Line of Credit”) available with a bank, collateralized by all the assets of Nextridge and ANS. Interest is payable monthly at the Wall Street Journal prime rate (7.50% and 3.25% at December 31, 2022 and 2021, respectively). As of December 31, 2022 and 2021, the Company had outstanding balances of $5.0 million and $1.9 million, respectively, on this ANS Line of Credit. On October 25, 2022, Nextridge and ANS renewed the line of credit increasing the availability from $4.0 million to $8.0 million. Borrowings under the line of credit will bear interest at a floating rate at the Wall Street Journal prime rate with a floor of 5%. Advances under the line of credit are limited to 70% and 50% of Nextridge and ANS’ eligible accounts receivable and work in progress, respectively. At each fiscal year end, Nextridge and ANS must maintain a minimum debt service coverage ratio of 1.2:1 and maximum debt/tangible net worth ratio of 3:1. The outstanding balance on the line of credit is payable upon demand by the bank. In addition to the security interest in the assets of Nextridge and ANS, the line of credit is guaranteed by the Company and Charge Infrastructure Holdings, Inc., the parent of Nextridge and ANS and a subsidiary of the Company. On November 18, 2022, Nextridge and ANS renewed a $750,000 equipment and vehicle line of credit available with a bank. Interest is payable monthly at the Wall Street Journal prime rate. On December 1, 2023, the line will convert to a term loan with the then five year Federal Home Loan Bank rate + 2.5% and have a five year term with a five year amortization. There are no financial commitments or covenants on the line of credit. As of December 31, 2022, the Company had an outstanding balance of $0 on this line of credit. BW has a revolving $3.0 million line of credit (the “BW Line of Credit”) available with a bank, collateralized by all the assets of BW. Interest is payable monthly at the Wall Street Journal prime rate (7.50% and 3.25% at December 31, 2022 and 2021, respectively). On May 26, 2022, BW renewed the facility with substantially the same terms and an expiration of August 1, 2023. Advances under the line of credit are limited to 75% of BW’s eligible accounts receivable. At all times during the loan term BW is required to maintain a minimum increase in the net retained earnings of $0.2 million tested annually and maintain a maximum seller funded debt to EBIDA of 2.0x tested semi-annually on a trailing twelve month basis beginning with the period ended June 30, 2022. In addition to the security interest in the assets of BW, the line of credit is guaranteed by the Company and Charge Infrastructure Holdings, Inc., the parent of BW and a subsidiary of the Company. As of December 31, 2022 and 2021, the Company had no outstanding balance on the BW Line of Credit. Notes payable Prior to our acquisition, BW was approved for a Paycheck Protection Program loan on February 10, 2021 from the Small Business Administration (“SBA”) in the amount of $2.0 million. In the second quarter of 2022, the loan was forgiven by the SBA. Although the loan was forgiven by the SBA, per our purchase agreement with the sellers of BW in December 2021, if such an event occurred, the Company is obligated to reimburse the SBA loan of $2.0 million to such sellers. As such, the $2.0 million SBA loan was reimbursed to the sellers of BW during the third quarter of 2022. On May 19, 2021, the Company entered into a securities purchase agreement with funds affiliated with Arena Investors LP (the “May 2021 Investors”) pursuant to which it issued notes payable in an aggregate face value (includes 7.5% premium and 10% original issue discount) of $11.8 million for an aggregate purchase price of $10.0 million (the “May 2021 Notes”). The May 2021 Notes have a coupon of 8% and an 18-month term. The May 2021 Notes’ original maturity date of November 19, 2022 was extended to November 19, 2023. On December 17, 2021, the Company entered into a securities purchase agreement with funds affiliated with Arena Investors LP (the “December 2021 Investors”) pursuant to which it issued a note payable in an aggregated face value of $15.9 million for an aggregate purchase price of $13.3 million (collectively, the “December 2021 Notes” and together with the May 2021 Notes, the “Notes”). The December 2021 Notes have a coupon of 7.5% and a 23-month term. The December 2021 Notes mature on November 19, 2023. Interest Expense The components of interest expense are as follows: Years Ended December 31, (in thousands) 2022 2021 Interest expense $ (2,559 ) $ (1,458 ) Amortization of debt issue costs - (10 ) Amortization of debt discount (9,346 ) (3,056 ) Amortization of debt discount, related party - (95 ) Total net interest expense $ (11,905 ) $ (4,619 ) Aggregate Principal Maturities The minimum aggregate principal maturities of the Company’s outstanding debt are as follows: (in thousands) Line of Credit Notes Payable Total Years ended December 31: 2023 $ 5,024 $ 27,786 $ 32,810 2024 - - - 2025 - - - 2026 - - - 2027 - - - Thereafter - - - Total $ 5,024 $ 27,786 $ 32,810 |
Derivative liabilities
Derivative liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Derivative liabilities | |
Derivative Liabilities | Note 11 Derivative liabilities The Company does not use financial derivative instruments to manage risk. In June 2022, the Company exchanged the outstanding convertible debt for Series D preferred stock (“Series D Preferred Stock”). Concurrently, the warrants that were granted along with the original convertible debt were amended to provide, at the holders’ choice, the option to exercise for a to-be-issued class of preferred stock, which are convertible into the same number of shares of common stock as would have been issued upon exercise of such warrants under the original terms. This amendment caused the instruments to be treated as a derivative liability beginning on June 30, 2022. The warrants were reclassified from equity to a derivative liability and measured at fair value using a Black Scholes model (Level 2 of GAAP fair value hierarchy), which included inputs for exercise price, stock price, term to expiration, volatility, and interest rate. The impact was a derivative liability of approximately $40.4 million and a deemed dividend of approximately $32.8 million. This derivative liability is revalued on a recurring basis with changes in the fair value of the derivative recorded through the consolidated statement of operations. The Company recorded a derivative liability in 2020 related to convertible debt that contained certain cash true up provisions that were not clearly and closely related to the host debt agreement in terms of economic risks and characteristics. The terms and features included a cash true-up obligation in certain circumstances. No cash payment was triggered, the true up provision expired on June 1, 2021, and the derivative balance was reclassified to additional paid-in-capital in the second quarter of 2021. The following table summarizes the effects on the Company’s gain (loss) associated with changes in the fair values of the derivative financial instruments by type of financing reflected on the change in fair value of derivative liabilities line: Years Ended December 31, (in thousands) 2022 2021 Derivative liability balance at January 1 $ - $ 750 Reclassification of derivative to Additional Paid in Capital - (750 ) Reclassification of warrants to derivative liability 40,442 - Change in fair value of derivative liabilities (33,921 ) - Derivative liability balance at December 31 $ 6,521 $ - |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Leases | Note 12 Leases The components of lease cost were as follows: Years Ended December 31, (in thousands) 2022 2021 Lease Cost Finance lease cost: Amortization of right-of-use assets $ 207 $ 139 Interest on lease liabilities 46 58 Total finance lease cost 253 197 Operating lease cost 1,647 71 Variable lease cost 838 - Short-term lease cost 50 11 Total operating lease cost 2,535 82 Total lease cost $ 2,788 $ 279 The remaining weighted-average lease term and the weighted-average discount rate were as follows: December 31, 2022 December 31, 2021 Weighted Average Remaining Lease Term Operating leases 2.1 years 6.3 years Finance leases 2.7 years 3.0 years Weighted Average Discount Rate Operating leases 3.4 % 3.0 % Finance leases 9.0 % 8.5 % Supplemental cash flow information related to leases was as follows: Years Ended December 31, (in thousands) 2022 2021 Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 2,470 $ 121 Operating cash flows from finance leases 29 26 Financing cash flows from finance leases 167 133 Right-of-use assets obtained in exchange for lease obligations Operating leases: $ 4,964 $ 1,558 Finance leases 47 270 The aggregate maturities of the Company’s lease liabilities as of December 31, 2022 are as follows: (in thousands) Operating Leases Finance Leases Total Leases Years ended December 31: 2023 $ 1,727 $ 130 $ 1,857 2024 968 91 1,059 2025 773 71 844 2026 212 10 222 2027 164 - 164 Thereafter 155 - 155 Total future minimum lease payments 3,999 302 4,301 Less: imputed interest (221 ) (44 ) (265 ) Present value of lease liabilities $ 3,778 $ 258 $ 4,036 Lease Revenue The Company leases commercial properties under agreements that are classified as operating leases. The Company’s commercial property leases generally include minimum rents and do not include recoveries for property taxes and common area maintenance. The Company’s rental revenues are earned from its EV Depot operations and are a component of Infrastructure revenues disclosed in Note 4, Revenue. The following table summarizes the components of rental revenue for the years ended December 31, 2022 and 2021: Years Ended December 31, (in thousands) 2022 2021 Revenue: Fixed component $ 4,792 $ - Variable component - - Total $ 4,792 $ - The following table summarizes the future rental payments to be received by the Company under non-cancelable leases: (in thousands) Amount Years ended December 31: 2023 $ 2,828 2024 1,018 2025 770 2026 - 2027 - Thereafter - Total $ 4,616 |
Reportable segments
Reportable segments | 12 Months Ended |
Dec. 31, 2022 | |
Reportable segments | |
Reportable Segments | Note 13 Reportable segments The Company has two reportable operating segments - Infrastructure, and Telecommunications. The Company also has a Non-operating Corporate segment. All inter-segment revenues are eliminated. Refer to Note 4, Revenue, for additional information on the Company’s revenue by segment. Summary information with respect to the Company’s income (loss) from operations is as follows: Years Ended December 31, (in thousands) 2022 2021 Income (loss) from operations: Infrastructure $ 3,198 $ 586 Telecommunications 1,227 1,679 Non-operating corporate (52,387 ) (40,549 ) Total $ (47,962 ) $ (38,284 ) A reconciliation of the Company’s consolidated segment loss from operations to consolidated loss from operations before income taxes and net loss is as follows: Years Ended December 31, (in thousands) 2022 2021 Loss from operations $ (47,962 ) $ (38,284 ) Impairment loss (797 ) (18,116 ) Income (loss) from investments, net (789 ) 3,330 Change in fair value of derivative liabilities 33,921 - Interest expense (11,905 ) (4,619 ) Other income (expense), net (2,482 ) 1,063 Foreign exchange adjustments (60 ) (334 ) Total other income (expenses) 17,888 (18,676 ) Loss from operations before income taxes (30,074 ) (56,960 ) Income tax (expense) benefit (275 ) 5,292 Net loss $ (30,349 ) $ (51,668 ) Years Ended December 31, (in thousands) 2022 2021 Depreciation and amortization: Infrastructure $ 6,207 $ 331 Telecommunications 170 198 Total $ 6,377 $ 529 Years Ended December 31, (in thousands) 2022 2021 Capital expenditures: Infrastructure $ 239 $ 1,355 Telecommunications - - Total $ 239 $ 1,355 Years Ended December 31, (in thousands) 2022 2021 Investments: Infrastructure $ 1,389 $ 2,280 Telecommunications - - Non-operating corporate 5,604 7,439 Total $ 6,993 $ 9,719 Years Ended December 31, (in thousands) 2022 2021 Assets: Infrastructure $ 97,292 $ 56,701 Telecommunications 57,234 73,659 Non-operating corporate 96,507 79,579 Eliminations (82,579 ) (66,329 ) Total $ 168,454 $ 143,610 |
Equity
Equity | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity | |
Equity | Note 14 Equity The Company has evaluated each series of preferred stock for proper classification under ASC 480, Distinguishing Liabilities from Equity Derivatives and Hedging The Company has 20,000,000 shares of preferred stock authorized with a par value of $0.0001. Permanent Equity Preferred Stock Series A: Series D: The Series D Preferred Stock has the following designations: · Convertible at the option of the holder into common stock at $0.4248 per share · The Series D liquidation preference is equal to $10.6191 per share · The holders are entitled to receive cumulative quarterly dividends at a fixed annual rate of 2.25% of the liquidation preference, or $0.23893 per share · No voting rights In addition to the exchange of the Convertible Notes, the related 11.8 million outstanding warrants to purchase common stock were amended to allow the holder to exercise for a to-be-issued class of the Company’s preferred stock, which shall be convertible into the same number of shares of common stock as would have been issued upon exercise of such warrants under the original terms. This amendment caused the instruments to be treated as a derivative liability beginning on June 30, 2022. The transition to derivative accounting created a derivative liability of $40.4 million and a related deemed dividend of $32.8 million. Changes in the fair value of the derivative liability are marked to market through the consolidated statement of operations in the respective period. Common Stock On April 20, 2022, the Company entered into a securities purchase agreement with an affiliate of Island Capital Group, LLC pursuant to which the Company issued 1,428,575 shares of Charge’s common stock and three-year warrants to purchase up to 2,000,000 shares of Charge’s common stock at $8.50 per share for an aggregate purchase price of $10.0 million. The purchase price was allocated between common stock and warrants and is reported within common stock and additional paid-in capital on the consolidated balance sheet. On December 8, 2020, the Company entered into a Private Placement Agreement for the purchase of up to an aggregate $2.5 million of Charge’s common stock at $0.25 per share. In connection with this agreement, the Company issued 8,700,000 shares for an aggregate purchase price of $2.2 million. The shares were issued on January 15, 2021. Mezzanine Equity Preferred Stock Series B: The Series B preferred stock had the following designations: · Convertible at the option of the holder · The holders are entitled to receive cumulative dividends at 4% per annum, payable quarterly on January 1, April 1, July 1, and October 1 · 1 preferred share is convertible to 1 common share · The Series B holders are entitled to receive liquidation in preference to the common holders or any other class or series of preferred stock · The Series B holders are entitled to vote together with the common holders as a single class · Mandatorily redeemable 180 days following the mandatory redemption date The shares of Series B preferred stock were mandatorily redeemable and, therefore, were required to be classified as a liability in the mezzanine section on the consolidated balance sheet as of December 31, 2021. Series C : On February 25, 2022, the Company entered into a securities purchase agreement with an affiliate of Island Capital Group LLC pursuant to which it issued 3,856,000 Series C preferred stock at an aggregate face value of $12.1 million for an aggregate purchase price of $10.8 million. The Company has valued and recorded the beneficial conversion feature of the Series C preferred stock resulting in a deemed dividend at the time of issuance. As of December 31, 2022 and 2021, there were 6,226,370 and 2,370,370 shares, respectively, of Series C preferred stock issued and outstanding. The Series C preferred stock has the following designations: · Convertible at the option of the holder at a conversion price of $3.125 per share · The holders are entitled to receive cumulative dividends at 6% per annum, payable monthly · In the event of reorganization, this class of preferred will not be affected by any such capital reorganization · The Series C liquidation preference is equal to the stated value, plus any accrued and unpaid dividends · Change of control provision whereby the Series C preferred shareholders would receive their stated value before all other shareholders · No voting rights · Redemption features: o If the closing price exceeds 200% of the effective conversion price, the Company may force the conversion of preferred stock with 10 days written notice; o At any time after the original issue date, the Company has the option to redeem some or all the outstanding preferred stock for cash with 10 days written notice; and o On the third anniversary of the issue date, the holder may request redemption, at the Company’s option of cash or common stock, at the conversion price equal to the four-year redemption amount (a) 100% of the aggregate stated value then outstanding, (b) accrued but unpaid dividends, (c) additional cash consideration in order for the Purchasers to achieve a 20% internal rate of return, and (d) all liquidated damages and other amounts due in respect of the preferred stock The Series C preferred stock provides that the Company shall redeem the preferred stock for cash or common stock at the Company’s option and, therefore, is not considered mandatorily redeemable. However, due to the change in control provision, the Series C preferred stock has liquidation preference and is deemed a liability and presented within mezzanine equity on the consolidated balance sheet as of December 31, 2022. 2020 Omnibus Equity Incentive Plan On January 11, 2021, the Company’s Board of Directors and a majority of its stockholders adopted the 2020 Omnibus Equity Incentive Plan (the “2020 Plan”), as amended and restated as of May 7, 2021 and on December 23, 2021, with 75.0 million shares available for issuance. Under the 2020 Plan, the Company may grant stock options, restricted stock, dividend equivalents, restricted stock units, stock appreciation rights, and other stock or cash-based awards to individuals who are employees, officers, non-employee directors or consultants of the Company. The vesting periods range from one to four years. As of December 31, 2022, approximately 34.6 million shares remain available for issuance under the 2020 Plan. Non-Qualified Stock Option Agreement On November 1, 2020, Transworld Holdings, Inc. granted 10.5 million in non-qualified stock options to the spouse of a key executive and current member of the Company’s Board of Directors for service in facilitating and completing the acquisition of PTGi. The stock options have an exercise price of $0.55, vest over a period of three years from the grant date and have a contractual term of 10 years. The grant date fair value of these stock options using the BSM valuation was $0.51 per share. These non-qualified stock options are separate from the 2020 Plan. Restricted Stock Units Restricted stock unit (“RSU”) activity is summarized as follows: (in thousands except exercise price and contractual term) Shares Weighted Average Grant Date Fair Value RSUs outstanding at December 31, 2021 241 $ 3.41 RSUs granted 405 2.26 RSUs released (241 ) 3.41 RSUs forfeited - 0.00 RSUs outstanding at December 31, 2022 405 $ 2.26 Weighted average remaining recognition period in years 3.5 Unamortized stock-based compensation expense $ 778 Stock options Stock option activity is summarized as follows: (in thousands except exercise price and contractual term) Shares Weighted Average Exercise Price Intrinsic Value Weighted Average Remaining Contractual Term Options outstanding at December 31, 2021 44,920 $ 1.78 - - Options granted 8,010 3.84 - - Options exercised (634 ) 0.57 - - Options cancelled (2,720 ) 3.08 - - Options outstanding at December 31, 2022 49,576 $ 2.06 $ 14,364 4.52 years Options exercisable at December 31, 2022 24,626 $ 1.44 $ 10,713 4.49 years Vested and expected to vest at December 31, 2022 49,576 $ 2.06 $ 14,364 4.52 years The weighted-average grant date fair value of all options granted during the years ended December 31, 2022 and 2021 was $2.37 and $2.82, respectively. The total intrinsic value of stock options exercised during the year ended December 31, 2022 was $1.1 million. There were no stock options exercised during the year ended December 31, 2021. At December 31, 2022, there was $25.2 million of unrecognized stock-based compensation cost related to unvested stock options that is expected to be recognized over a weighted-average period of 1.9 years. The Company uses the following assumptions in its BSM valuation for stock options granted: Years Ended December 31, 2022 2021 Weighted risk-free interest rate 1 2.5 % 0.4 % Weighted-average volatility 2 257 % 412 % Weighted expected dividend yield 3 - % - % Weighted expected term (in years) 4 4.2 3.4 1. Risk-free interest rate - Determined based on the U.S. Treasury yield in effect at the time of the grant for zero-coupon U.S. Treasury notes with remaining terms similar to the expected term of the options. 2. Expected volatility - Determined based on a blend of the Company’s historic stock price volatility and the historic volatility of a peer group of publicly traded companies. 3. Expected dividend yield - Determined to be zero as the Company has not and does not currently plan to issue dividends. 4. Expected term - Determined using the “simplified method” for estimating the expected option life, which is the midpoint of the weighted-average vesting period and contractual term of the option. Warrants Warrant activity is summarized as follows: (in thousands except exercise price and contractual life) Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life Warrants outstanding at January 1, 2021 19,845 $ 1.26 3.5 years Issued 4,240 4.00 2.1 years Exercised - - N/A Expired - - N/A Warrants outstanding at December 31, 2021 24,085 $ 1.74 3.0 years Warrants exercisable at December 31, 2021 24,085 $ 1.74 3.0 years Issued 2,000 8.50 2.8 years Exercised (8,183 ) (1.59 ) N/A Expired - - N/A Warrants outstanding at December 31, 2022 17,902 $ 2.56 1.8 years Warrants exercisable at December 31, 2022 17,902 $ 2.56 1.8 years Recognized Non-Cash Stock-Based Compensation Expense The following non-cash stock-based compensation expense, which is related primarily to options, is included in the stock-based compensation line item in the consolidated statements of operations: Years Ended December 31, (in thousands) 2022 2021 Stock-based compensation $ 35,449 $ 30,623 Income tax benefit (1) 276 2,408 After-tax stock-based compensation expense $ 35,173 $ 28,215 (1) Amounts exclude impact from any stock-based compensation expense subject to Section 162(m) of the Internal Revenue Code, which is nondeductible for income tax purposes. |
Commitments contingencies and c
Commitments contingencies and concentration risk | 12 Months Ended |
Dec. 31, 2022 | |
Commitments contingencies and concentration risk | |
Commitments, Contingencies And Concentration Risk | Note 15 Commitments, contingencies and concentration risk Contingencies During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with ASC 450, Contingencies Other Commitments Indemnities The Company generally indemnifies its customers for the services it provides under its contracts, as well as other specified liabilities, which may subject the Company to indemnity claims, liabilities and related litigation. As of December 31, 2022 and 2021, the Company was not aware of any material asserted or unasserted claims in connection with these indemnity obligations. Performance and Payment Bonds Many customers, particularly in connection with new construction within Infrastructure, require the Company to post performance and payment bonds issued by a financial institution known as a surety. If the Company fails to perform under the terms of a contract or to pay subcontractors and vendors who provided goods or services under a contract, the customer may demand that the surety make payments or provide services under the bond. The Company must reimburse the surety for any expenses or outlays it incurs. To date, the Company is not aware of any losses to their sureties in connection with bonds the sureties have posted on their behalf, and do not expect such losses to be incurred in the foreseeable future. Generally, 10% of bonding needs are held in cash on the balance sheet. Concentration of Credit Risk The Company maintains accounts with financial institutions. All cash in checking accounts is non-interest bearing and is fully insured by the FDIC up to a $250,000 limit. At times, cash balances may exceed the maximum coverage provided by the FDIC on insured depositor accounts. The Company believes it mitigates its risk by depositing its cash and cash equivalents with major financial institutions. Major Customer Concentration There were three customers whose individual accounts receivable represented 10% or more of the Company’s total accounts receivable and whose accounts receivable in aggregate accounted for approximately 46% of the Company’s total accounts receivable as of December 31, 2022. The Company had two customers whose accounts receivable individually represented 10% or more of the Company’s total accounts receivable and whose accounts receivable in aggregate accounted for approximately 25% of the Company’s total accounts receivable as of December 31, 2021. The Company has two customers whose revenue individually represented 10% or more of the Company’s total revenue and whose revenue in aggregate accounted for approximately 36% of the Company’s total revenue for the twelve months ended December 31, 2022, respectively. The Company had three customers whose revenue individually represented 10% or more of the Company’s total revenue and in aggregate accounted for approximately 41% of the Company’s total revenue for the twelve months ended December 31, 2021. Labor Concentration One of our operating subsidiaries within Infrastructure sources direct labor from local unions, which have collective bargaining agreements expiring at various times over the next four years. Although the Company’s past experience has been favorable with respect to resolving conflicting demands with these unions, it is possible that contract negotiations are unsuccessful which could impact the renewal of the collective bargaining agreements and availability of personnel. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income taxes | |
Income Taxes | Note 16 Income taxes The components of income tax expense (benefit) for the years ended December 31 were as follows: Years Ended December 31, (in thousands) 2022 2021 Current: Federal $ - $ - State and local 965 37 Total 965 37 Deferred: Federal (334 ) (5,403 ) State and local (356 ) 74 Total (690 ) (5,329 ) Total income tax expense (benefit) $ 275 $ (5,292 ) The following table reconciles the difference between the statutory federal income tax rate for the Company and the effective income tax rate for the years ended December 31: Years Ended December 31, 2022 2021 U.S. statutory federal income tax rate 21.0 % 21.0 % Change in valuation allowance (36.9 ) (1.3 ) Convertible Debt (4.1 ) - Derivative Expense 23.7 - Incentive Stock Options (1.2 ) (3.8 ) Deferred Consideration (1.9 ) - Goodwill impairment - (6.2 ) Vesting & Exercises 1.0 - 162m limitation (2.2 ) - Other (0.3 ) (0.2 ) Income tax rate (0.9 )% 9.5 % Deferred income taxes reflect the net tax effect of temporary differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income taxes. Significant components of U.S. federal and state deferred tax assets and liabilities are as follows: (in thousands) December 31, 2022 December 31, 2021 Deferred tax assets: Net operating loss carryforwards $ 3,990 $ 4,916 Capital Loss Carryforward 64 - Stock-based compensation expense 11,282 4,677 Allowance for bad debts 81 62 163 (j)Limitation 1,567 255 Fixed assets 618 406 Unrealized Gains/(loss) 441 197 Foreign exchange gains (losses) 12 - Other 132 6 Total gross deferred tax assets 18,187 10,519 Less: valuation allowance (13,278 ) (4,920 ) Net deferred tax assets 4,909 5,599 Deferred tax liabilities: Goodwill (3 ) - Intangible Asset (6,295 ) - Foreign exchange gains (losses) - (19 ) Total gross deferred tax liabilities (6,298 ) (19 ) Net deferred tax assets (liabilities) $ (1,389 ) $ 5,580 The following table presents the changes in the deferred tax asset valuation allowance for the periods indicated: (in thousands) Balance at Beginning of Year Increase (Decrease) Charged (Credited) to Income Taxes (Benefit) Balance at End of Year Year ended December 31, 2022 $ 4,920 $ 8,358 $ 13,278 December 31, 2021 3,769 1,151 4,920 Future utilization of net operating losses (“NOLs”) arising in tax years after December 31, 2017, are limited to eighty percent of taxable income and are allowed to be carried forward indefinitely. NOLs generated in 2017 and prior may carry forward 20 years (expiring in 2037). As of December 31, 2022 the Company has $0.2 million of NOLs generated prior to December 31, 2017 (expiring in 2037) and $18 million of NOLs generated after 2017. During tax year 2020, the Company underwent an ownership change as defined by Section 382 of the Internal Revenue Code and as such the NOLs will be subject to annual limitations. As of December 31, 2022, the Company’s full valuation allowance of $13.3 million related primarily to Federal NOL carryforwards and stock-based compensation deferred tax assets. As of December 31, 2021, the Company’s valuation allowance of $4.9 million related primarily to Federal NOL carryforwards. The Company files U.S. federal and certain applicable U.S. state income tax returns. Management has reviewed and evaluated the relevant technical merits of each of its tax positions and determined that there are no uncertain tax positions that would have a material impact on these financial statements. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events | |
Subsequent Events | Note 17 Subsequent Events Events occurring after December 31, 2022, and through the date that these consolidated financial statements were issued, were evaluated to ensure that any subsequent events that met the criteria for recognition have been included. No subsequent events have been identified. |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of significant accounting policies | |
Basis Of Presentation | The accompanying financial statements of the Company have been prepared in accordance with accounting standards generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it intends to take advantage of certain exemptions from various reporting requirements. |
Principles Of Consolidation | The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The consolidated financial statements and related disclosures, presented in U.S. dollars, have been prepared using the accrual basis of accounting in accordance with GAAP and pursuant to the rules and regulations of the SEC. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these financial statements have been included. All such adjustments are of a normal and recurring nature. The results and trends in these consolidated financial statements may not be representative for any future periods. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of stock-based compensation, asset impairments including goodwill and intangible assets, acquisition purchase price asset and liability allocations, the valuation of derivative liabilities, and the valuation of deferred tax assets. The Company evaluates and updates assumptions and estimates on an ongoing basis and may use outside experts to assist in the Company’s evaluation, as considered necessary. Although these estimates are based on management’s knowledge of and experience with past and current events and on management’s assumptions about future events, it is at least reasonably possible that they may ultimately differ materially from actual results. |
Segments | The Company determined its reporting units in accordance with ASC 280, S egment Reporting The Company operates under two reportable business segments for which segment disclosures are consistent with how the chief operating decision maker evaluates the results of the Company and measures performance and determines the allocation of resources. The Company’s reportable segments meet the definition of operating segments and do not include the aggregation of multiple operating segments. The Company’s reportable segments are Infrastructure and Telecommunications. Nextridge Inc. and its wholly owned subsidiary, Advanced Network Solutions (collectively referred to as “ANS”), B W Electrical Services, LLC (“BW”), EV Group Holdings LLC (“EV Depot”) and Get Charged Inc. (“Get Charged”) are included in Infrastructure. Our PTGi International Carrier Services, Inc. (“PTGi”) subsidiary is included in Telecommunications. |
Revenue Recognition | Revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. The Company’s main revenue stream is from services. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer, in an amount that reflects the consideration it expects to be entitled to in exchange for those products or services. The Company evaluates when it is appropriate to recognize revenues based on the gross amount invoiced to the customer or the net amount retained by the Company if a third party is involved. Revenue is recognized when or as performance obligations under the terms of a contract with customers are satisfied. For Telecommunications, revenue recognition typically occurs at the point in time that calls are completed. For Infrastructure, revenue recognition typically occurs over time through the contract term. A contract liability for deferred revenue is recorded when consideration is received or is unconditionally due from a customer prior to transferring control of goods or services to the customer under the terms of a contract. Deferred revenue balances typically result from advance payments received from customers for contracts or from billings in excess of revenue recognized on services arrangements. Costs in excess of billing represents when revenues are recognized in advance of invoice issuance. These assets are presented separately on the balance sheet and are converted to accounts receivable once the Company’s right to the consideration becomes unconditional, which varies by contract but is generally based on achieving certain acceptance milestones. The Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset would be one year or less. Infrastructure Due to the nature of the Company’s performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontracts, and the availability and timing of funding from the customer, among other variables. As a significant change in one or more of these estimates could affect the profitability of contracts, the Company reviews and updates contract-related estimates regularly through a review process in which management reviews the progress and execution of performance obligations and the estimated cost at completion. As part of this process, management reviews information including, but not limited to, any outstanding key contract matter, progress towards completion and the related program schedule and the related changes in estimates of revenues and costs. The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes a provision for the entire loss in the period it is identified. The nature of the Company’s contracts gives rise to several types of variable consideration, including claims and unpriced change orders. The Company recognizes revenue for variable consideration when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount of revenue to be recognized on variable consideration, using the expected value or the most likely amount method, whichever is expected to better predict the amount. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on assessments of legal enforceability, performance, and all information that is reasonably available to the Company. Telecommunications The Company’s performance obligations include the routing of voice, data and Short Message Services (“SMS”) to carriers and mobile network operators globally. The Company has contractual relationships with services providers within Asia, Europe, the Middle East, Africa and North and South America. The Company provides customers with internet-protocol-based and time-division multiplexing access for the transport of long-distance voice and data minutes. Refer to Note 4, Revenue, for additional information on the Company’s revenue recognition. |
Stock Based Compensation | The Company uses the Black-Scholes-Merton (“BSM”) valuation technique to calculate the grant date fair values for stock options. The BSM valuation inputs include the option exercise price, the fair market value price of the Company’s common stock, expected term, expected volatility, expected dividend yield and risk-free interest rate. The fair value of restricted stock units (“RSUs”) is determined using the closing price of the Company’s common stock on the grant date. The Company’s accounting policy for recognizing stock-based compensation expense is based on the graded vesting attribution method. The Company does not apply a forfeiture rate to unvested awards and accounts for forfeitures in the period they occur. The Company records deferred tax assets related to compensation expense for awards that are expected to result in future tax deductions for the Company, based on the amount of compensation cost recognized and the Company’s statutory tax rate in the jurisdiction in which it expects to receive a deduction. Differences between the deferred tax assets recognized for financial reporting purposes and actual tax deductions reported on the Company’s income tax return are recorded in the Consolidated Statements of Operations within income tax (expense) benefit. The Company also uses the simplified method in developing an estimate of the expected term of stock options. Expected volatility is based on a blend of the Company’s historic stock price volatility and the historic volatility of a peer group of publicly traded companies. Changes in these assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require judgment to develop. Refer to Note 14, Equity, for additional information on the Company’s stock-based compensation. |
Cash, Cash Equivalents and Restricted Cash | Cash and cash equivalents consists primarily of amounts held on deposit with financial institutions. From time to time, the Company may invest in cash equivalents, which consists of investments in immediately available money market accounts and all highly liquid debt instruments with initial maturities of three months or less. The Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. Restricted cash balances consist of amounts that the Company may be restricted in its ability to access or amounts that are reserved for a specific purpose and therefore not available for immediate or general business use. As of December 31, 2022, and December 31, 2021, the Company had restricted cash of $0.9 million and $0, respectively. These funds represent balances that have been reserved for a Directors and Officers insurance policy. |
Fair Value Measurements and Fair Value of Financial Instruments | Accounting Standard Codification (“ASC”) Topic 820, Fair Value Measurements Level 1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2: Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3: Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information. ASC subtopic 825-10, Financial Instruments The Company follows ASC subtopic 820-10, Fair Value Measurements and Disclosures |
Property, plant and equipment | Fixed Assets are carried at historical cost. Depreciation is calculated on the straight-line method over the estimated useful lives as follows: Computer hardware 3 - 5 years Computer software 3 years Equipment 2 - 7 years Furniture and fixtures 5 - 7 years Leasehold improvement Lesser of life of lease or asset life Vehicles 3 - 5 years |
Goodwill and Other Intangible Assets | Goodwill is assigned to reporting units based on the difference between the purchase price as allocated to the reporting units and the estimated fair value of the identified net assets acquired as allocated to the reporting units. Purchased intangible assets with finite lives are carried at their estimated fair values at the time of acquisition less accumulated amortization and any impairment charges. Amortization is recognized on a straight-line basis over the estimated useful lives of the respective assets, which approximates the pattern that the economic benefits are realized by the Company. Asset Impairments Goodwill is tested for impairment annually as of October 1 or at other times if events have occurred or circumstances exist that indicate the carrying value of the reporting unit may exceed its fair value. Goodwill is not amortized for book purposes. It may be, however, amortized for tax purposes. The Company reviews its goodwill for impairment at least annually. At the time of each review, if the fair value is less than the carrying value of the reporting unit, then a charge is recorded to the results of operations. For goodwill, the Company uses qualitative and quantitative approaches when testing goodwill for impairment. The Company performs a qualitative evaluation of events and circumstances impacting each reporting unit to determine the likelihood of goodwill impairment. Based on that qualitative evaluation, if the Company determines it is more likely than not that the fair value of a reporting unit exceeds its carrying amount, no further evaluation is necessary. Otherwise, the Company performs a quantitative goodwill impairment test. The Company performs quantitative goodwill impairment tests for reporting units at least once every three years. Property, plant and equipment, intangible assets with finite lives and right of use assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable, based on the undiscounted cash flows expected to be derived from the use and ultimate disposition of the assets. Assets identified as impaired are adjusted to estimated fair value. |
Beneficial conversion features | If the conversion features of conventional convertible debt provide for a rate of conversion that is below market value at issuance, this feature is characterized as a beneficial conversion feature (“BCF”). A BCF is recorded by the Company as a debt discount pursuant to ASC Topic 470-20 “ Debt with Conversion and Other Options |
Derivative Liability | The Company evaluates convertible instruments, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for under ASC Topic 815, “ Derivatives and Hedging |
Income Taxes | The Company has adopted ASC 740-10, Accounting for Income Taxes The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as a component of general and administrative expenses. Our federal tax return and any state tax returns are not currently under examination. The Company is subject to federal and state income tax audits from time to time that could result in proposed assessments. Management believes that the Company has appropriately accounted for income taxes for tax periods that are within the statutory period of limitations not previously audited and that are potentially open for examination by the taxing authorities. The Company cannot predict with certainty how any audits would be resolved and whether the Company will be required to make additional tax payments, which may include penalties and interest. The Company is subject to examination for the preceding three years. |
Leases | The Company enters into operating lease contracts for buildings, properties, structures and other equipment. Arrangements are evaluated at inception to determine whether such arrangements contain a lease. Operating leases primarily include building lease contracts. Arrangements to lease building space consist primarily of the rental of office space, but may also include leases of other equipment, including automobiles. Operating leases are reflected on the Company’s consolidated balance sheet within the Operating lease right-of-use (“ROU”) asset line item and the related short-term and long-term liabilities are included within the Operating lease liability and Operating lease liability, non-current line items, respectively. Finance leases are reflected on the Company’s consolidated balance sheet within Finance lease right-of-use asset line item and the related short-term and long-term liabilities are included within the Finance lease liability and Finance lease liability, non-current line items. As an accounting policy election, the Company elected not to apply the recognition requirements to short-term leases for all underlying classes of assets. For these leases which have a term of twelve months or less at lease inception, the Company will recognize the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for these payments is incurred. ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at lease commencement date based on the present value of lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term. Repayments of the principal portion of the finance lease liabilities are classified within financing activities. Certain of the Company’s operating lease agreements include rental payments that are adjusted periodically for inflationary changes. Payments due to changes in inflationary adjustments are included within variable rent expense, which is accounted for separately from periodic straight-line lease expense. Certain of the Company’s leases provide options to extend the terms of the agreements. Generally, renewal periods are excluded from minimum lease payments when calculating the lease liabilities as, for most leases, the Company does not consider exercise of such options to be reasonably certain. Unless a renewal option is considered reasonably assured, the optional terms and related payments are not included within the lease liability. For those leases for which renewal periods are included in calculating minimum lease liabilities, any adjustments resulting from changes in circumstances which result in the renewal options no longer being reasonably certain are accounted for as changes in estimates. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The implicit rate within the Company’s lease agreements is generally not determinable. As such, the Company uses the incremental borrowing rate (“IBR”) to determine the present value of lease payments at the commencement of the lease. The IBR is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment . When the Company decides to abandon a leased property before the expiration of the lease term, management assesses whether such property will be subleased. If it is determined that subleasing the property for the remaining lease term is reasonable, management estimates the fair value of the sublease payments to be received and compares the estimated fair value to the ROU asset. To the extent the estimated fair value is less than the net book value of the ROU asset, the Company records a non-cash impairment charge for the difference, and the remaining ROU asset is recorded ratably over the remaining lease term. If it is determined that subleasing the property for the remaining lease term is not reasonable (e.g., the remaining lease term is too short to reasonably expect the property to be subleased), amortization of the net book value of the ROU asset is accelerated and recognized as expense ratably from the decision date to the date the Company ceases use of the property. |
Advertising Costs | Advertising costs are expensed in the period in which they are incurred and are reflected in general and administrative expense on the Consolidated Statements of Operations. Advertising expense was $0.8 million and $0.3 million for the years ended December 31, 2022 and 2021, respectively. |
Net Income (Loss) Per Share | Basic income (loss) per share available to common stockholders is calculated using the weighted average number of common shares outstanding during the applicable period. Diluted net income (loss) per share available to common stockholders is calculated using the weighted average number of common shares outstanding plus the number of dilutive potential common shares outstanding during the applicable period. Dilutive potential common shares consist of the incremental common shares (i) issuable upon the vesting of outstanding restricted stock units and the exercise of outstanding stock options using the treasury stock method and (ii) issuable for non-participating preferred stock using the if-converted method. Our warrants and some of our preferred stock are considered participating securities pursuant to the two-class method. Dilutive potential common shares are excluded from the calculation of diluted net income (loss) per share available to common stockholders if their effect is antidilutive. The following potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders because their effect would have been antidilutive: Years Ended December 31, (in thousands) 2022 2021 Restricted stock units 196 65 Warrants 20,552 21,097 Stock options 48,986 34,740 Preferred stock 21,677 1,565 Convertible notes payable 24,847 43,832 Total 116,258 101,299 |
Recent Accounting Pronouncements | In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity . In October 2021, the FASB issued ASU No. 2021-08, Business Combinations - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers |
Reclassification | Certain amounts included in prior year financial statements have been reclassified to conform to the current year presentation. These reclassifications did not have a material impact on the Company’s previously reported financial statements. |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of significant accounting policies | |
Estimated useful lives | Computer hardware 3 - 5 years Computer software 3 years Equipment 2 - 7 years Furniture and fixtures 5 - 7 years Leasehold improvement Lesser of life of lease or asset life Vehicles 3 - 5 years |
Schedule of net income (loss) per share | Years Ended December 31, (in thousands) 2022 2021 Restricted stock units 196 65 Warrants 20,552 21,097 Stock options 48,986 34,740 Preferred stock 21,677 1,565 Convertible notes payable 24,847 43,832 Total 116,258 101,299 |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair value measurements | |
Assets and liabilities measured at fair value | December 31, 2022 December 31, 2021 (in thousands) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets: Marketable securities (Note 5) $ 6,757 $ 9,619 Liabilities: Derivative liabilities (Note 11) $ 6,521 $ - Contingent consideration $ - $ - |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue | |
Summary of contract balances | (in thousands) 2022 2021 Receivables included in “Accounts receivable net of allowances” $ 72,405 $ 73,334 Cost in excess of billings 6,090 4,812 Deferred revenue - current 13,741 7,018 |
Summary of changes in the balance of contract liabilities | (in thousands) Balance at December 31, 2021 $ 7,018 Revenue recognized during the period that was included in the beginning balance (6,484 ) Additions, net of revenue recognized during the period 13,207 Balance at December 31, 2022 $ 13,741 |
Disaggregation of revenue | Years Ended December 31, (in thousands) 2022 2021 Revenue: Infrastructure $ 105,523 $ 24,251 Telecommunications 592,310 452,767 Total $ 697,833 $ 477,018 |
Marketable securities and oth_2
Marketable securities and other investments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Marketable securities and other investments | |
Marketable Securities | (in thousands) December 31, 2022 December 31, 2021 Brokerage Account $ 6,757 $ 9,588 Other Securities - 31 Total Fair Value $ 6,757 $ 9,619 |
Business combinations (Tables)
Business combinations (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business combinations | |
Business combinations | (in thousands, except shares) Preliminary Estimates Measurement Period Adjustments Final Cash $ 1,231 $ - $ 1,231 Accrued expenses 19 - 19 Contingent consideration liability, net of $72 contingent consideration asset 7 - 7 Common stock (5,201,863 shares) 17,530 - 17,530 Total consideration $ 18,787 $ - $ 18,787 Fair values of identifiable net assets and liabilities (in thousands): Assets: Cash $ 104 $ - $ 104 Deposits, prepaids, and other current assets, net 5 - 5 Non-current assets 391 - 391 Operating lease right-of-use asset 2,017 479 2,496 Goodwill 18,498 (11,768 ) 6,730 Intangible Assets, net - 15,921 15,921 Total assets 21,015 4,632 25,647 Liabilities: Accrued liabilities 44 - 44 Deferred revenue 167 - 167 Operating lease liability 2,017 - 2,017 Deferred tax liability - 4,632 4,632 Total liabilities 2,228 4,632 6,860 Total fair value of identifiable net assets and liabilities $ 18,787 $ - $ 18,787 (in thousands, except shares) Preliminary Estimates Measurement Period Adjustments Final Cash $ 13,500 $ 2,450 $ 15,950 Common stock (1,285,714 shares) 4,539 - 4,539 Total consideration $ 18,039 $ 2,450 $ 20,489 Fair values of identifiable net assets and liabilities (in thousands): Assets: Cash $ 3,068 $ - $ 3,068 Accounts receivable 7,033 - 7,033 Deposits, prepaids, and other current assets, net 93 - 93 Investments in marketable securities 2,280 - 2,280 Cost in excess of billings 970 - 970 Property, plant, and equipment 105 - 105 Operating lease right-of-use asset 1,071 - 1,071 Goodwill 11,730 (11,578 ) 152 Intangible Assets, net - 11,569 11,569 Total assets 26,350 (9 ) 26,341 Liabilities: Accounts payable 1,306 - 1,306 Accrued liabilities 1,663 (459 ) 1,204 Deferred revenue 2,271 - 2,271 Operating lease liability 1,071 - 1,071 Notes payable 2,000 (2,000 ) - Total liabilities 8,311 (2,459 ) 5,852 Total fair value of identifiable net assets and liabilities $ 18,039 $ 2,450 $ 20,489 (in thousands, except shares) Preliminary Estimates Measurement Period Adjustments Final Cash $ 12,948 $ 363 $ 13,311 Series B preferred stock (2,395,105 shares) 6,850 - 6,850 Total consideration $ 19,798 $ 363 $ 20,161 Fair values of identifiable net assets and liabilities (in thousands): Assets: Cash $ - $ - $ - Accounts receivable 6,492 - 6,492 Inventory 171 - 171 Deposits and prepaids 512 - 512 Accrued revenue 1,620 - 1,620 Other current assets 2,289 - 2,289 Property, plant, and equipment 680 - 680 Finance lease asset 229 - 229 Operating lease right-of-use asset 603 - 603 Goodwill 13,418 (8,400 ) 5,018 Intangible Assets, net - 11,925 11,925 Total assets 26,014 3,525 29,539 Liabilities: Accounts payable 2,638 - 2,638 Accrued liabilities 1,014 135 1,149 Line of credit 1,785 - 1,785 Net deferred tax liability - 3,027 3,027 Finance lease liability 176 - 176 Operating lease liability 603 - 603 Total liabilities 6,216 3,162 9,378 Total fair value of identifiable net assets and liabilities $ 19,798 $ 363 $ 20,161 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and intangible assets | |
Schedule of goodwill by reportable segment | (in thousands) Infrastructure Telecommunications Total Goodwill, gross, at December 31, 2020 $ 27,327 $ 549 $ 27,876 Additions 25,148 - 25,148 Measurement period adjustments 135 223 358 Goodwill, gross, at December 31, 2021 52,610 772 53,382 Addition 18,497 - 18,497 Measurement period adjustments (31,880 ) - (31,880 ) Goodwill, gross, at December 31, 2022 $ 39,227 $ 772 $ 39,999 Accumulated impairment at December 31, 2020 $ (10,700 ) $ - $ (10,700 ) Impairment (16,627 ) - (16,627 ) Accumulated impairment at December 31, 2021 (27,327 ) - (27,327 ) Impairment - - - Accumulated impairment at December 31, 2022 $ (27,327 ) $ - $ (27,327 ) Goodwill, net, at December 31, 2021 $ 25,283 $ 772 $ 26,055 Goodwill, net, at December 31, 2022 $ 11,900 $ 772 $ 12,672 |
Schedule of fair value of the EV Depot | Estimates and Assumptions Fourth Quarter 2022 Discount Rate 15.5 % Forecasted revenue growth rates 3% to 42 % Terminal value growth rate 3 % |
Intangible assets | December 31, 2022 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 30,849 $ (2,489 ) $ 28,360 Backlog 3,322 (1,107 ) 2,215 Non-compete agreements 3,729 (895 ) 2,834 Off-market favorable leases 955 (955 ) - Brand 560 (37 ) 523 Total $ 39,415 $ (5,483 ) $ 33,932 |
Estimated future amortization expense | (in thousands) 2023 $ 4,134 2024 4,134 2025 3,026 2026 2,132 2027 2,094 Thereafter 18,412 Total $ 33,932 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, plant, and equipment | |
Property and equipment | (in thousands) December 31, 2022 December 31, 2021 Equipment $ 5,214 $ 5,924 Computer hardware 468 468 Computer software 37 37 Furniture and fixtures 112 106 Vehicles 2,794 2,831 Leasehold improvements 6 6 8,631 9,372 Less: accumulated depreciation (7,899 ) (7,360 ) Property, plant, and equipment, net $ 732 $ 2,012 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Schedule of debt | (in thousands) December 31, 2022 December 31, 2021 Convertible Notes Payable Issued on May 8, 2020 $ - $ 3,000 Issued on November 3, 2020 - 3,889 Issued on May 19, 2021 - 5,610 Issued on April 30, 2021 - 66 Total Face Value of Convertible Notes Payable - 12,565 Less: Unamortized Discount - (5,389 ) Net Carrying Value of Convertible Notes Payable - 7,176 Line of Credit ANS Line of Credit 5,024 1,898 Total Line of Credit 5,024 1,898 Notes Payable Paycheck Protection Program - 2,000 Issued on May 19, 2021 11,860 11,860 Issued on December 17, 2021 15,926 15,926 Total Face Value of Notes Payable 27,786 29,786 Less: Unamortized Discount (3,630 ) (3,699 ) Net Carrying Value of Notes Payable 24,156 26,087 Total debt before deferred financing costs 29,180 35,161 Current amount of Convertible Notes Payable - 2,700 Current amount of Notes Payable 24,156 - Current amount of Line of Credit 5,024 1,898 Total current portion of long-term debt 29,180 4,598 Total long-term debt, net of current portion $ - $ 30,563 |
Schedule of interest expense | Years Ended December 31, (in thousands) 2022 2021 Interest expense $ (2,559 ) $ (1,458 ) Amortization of debt issue costs - (10 ) Amortization of debt discount (9,346 ) (3,056 ) Amortization of debt discount, related party - (95 ) Total net interest expense $ (11,905 ) $ (4,619 ) |
Schedule of aggregate principal maturities | (in thousands) Line of Credit Notes Payable Total Years ended December 31: 2023 $ 5,024 $ 27,786 $ 32,810 2024 - - - 2025 - - - 2026 - - - 2027 - - - Thereafter - - - Total $ 5,024 $ 27,786 $ 32,810 |
Derivative liabilities (Tables)
Derivative liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative liabilities | |
Schedule of change in fair value of derivative liabilities | Years Ended December 31, (in thousands) 2022 2021 Derivative liability balance at January 1 $ - $ 750 Reclassification of derivative to Additional Paid in Capital - (750 ) Reclassification of warrants to derivative liability 40,442 - Change in fair value of derivative liabilities (33,921 ) - Derivative liability balance at December 31 $ 6,521 $ - |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Components of lease costs | Years Ended December 31, (in thousands) 2022 2021 Lease Cost Finance lease cost: Amortization of right-of-use assets $ 207 $ 139 Interest on lease liabilities 46 58 Total finance lease cost 253 197 Operating lease cost 1,647 71 Variable lease cost 838 - Short-term lease cost 50 11 Total operating lease cost 2,535 82 Total lease cost $ 2,788 $ 279 |
Schedule of weighted-average lease term and the weighted-average discount | December 31, 2022 December 31, 2021 Weighted Average Remaining Lease Term Operating leases 2.1 years 6.3 years Finance leases 2.7 years 3.0 years Weighted Average Discount Rate Operating leases 3.4 % 3.0 % Finance leases 9.0 % 8.5 % |
Schedule of leases supplemental cash flow information | Years Ended December 31, (in thousands) 2022 2021 Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 2,470 $ 121 Operating cash flows from finance leases 29 26 Financing cash flows from finance leases 167 133 Right-of-use assets obtained in exchange for lease obligations Operating leases: $ 4,964 $ 1,558 Finance leases 47 270 |
Schedule of future lease payment for operating lease and financing lease | (in thousands) Operating Leases Finance Leases Total Leases Years ended December 31: 2023 $ 1,727 $ 130 $ 1,857 2024 968 91 1,059 2025 773 71 844 2026 212 10 222 2027 164 - 164 Thereafter 155 - 155 Total future minimum lease payments 3,999 302 4,301 Less: imputed interest (221 ) (44 ) (265 ) Present value of lease liabilities $ 3,778 $ 258 $ 4,036 |
Summary of components of rental revenue | Years Ended December 31, (in thousands) 2022 2021 Revenue: Fixed component $ 4,792 $ - Variable component - - Total $ 4,792 $ - |
Summary of future rental payments | (in thousands) Amount Years ended December 31: 2023 $ 2,828 2024 1,018 2025 770 2026 - 2027 - Thereafter - Total $ 4,616 |
Reportable segments (Tables)
Reportable segments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Reportable segments | |
Summary of operating segment | Years Ended December 31, (in thousands) 2022 2021 Income (loss) from operations: Infrastructure $ 3,198 $ 586 Telecommunications 1,227 1,679 Non-operating corporate (52,387 ) (40,549 ) Total $ (47,962 ) $ (38,284 ) |
Reconciliation of operating income loss segment | Years Ended December 31, (in thousands) 2022 2021 Loss from operations $ (47,962 ) $ (38,284 ) Impairment loss (797 ) (18,116 ) Income (loss) from investments, net (789 ) 3,330 Change in fair value of derivative liabilities 33,921 - Interest expense (11,905 ) (4,619 ) Other income (expense), net (2,482 ) 1,063 Foreign exchange adjustments (60 ) (334 ) Total other income (expenses) 17,888 (18,676 ) Loss from operations before income taxes (30,074 ) (56,960 ) Income tax (expense) benefit (275 ) 5,292 Net loss $ (30,349 ) $ (51,668 ) |
Depreciation and Amortization | Years Ended December 31, (in thousands) 2022 2021 Depreciation and amortization: Infrastructure $ 6,207 $ 331 Telecommunications 170 198 Total $ 6,377 $ 529 |
Capital Expenditures | Years Ended December 31, (in thousands) 2022 2021 Capital expenditures: Infrastructure $ 239 $ 1,355 Telecommunications - - Total $ 239 $ 1,355 |
Investments | Years Ended December 31, (in thousands) 2022 2021 Investments: Infrastructure $ 1,389 $ 2,280 Telecommunications - - Non-operating corporate 5,604 7,439 Total $ 6,993 $ 9,719 |
Assets | Years Ended December 31, (in thousands) 2022 2021 Assets: Infrastructure $ 97,292 $ 56,701 Telecommunications 57,234 73,659 Non-operating corporate 96,507 79,579 Eliminations (82,579 ) (66,329 ) Total $ 168,454 $ 143,610 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity | |
Restricted Stock Units | (in thousands except exercise price and contractual term) Shares Weighted Average Grant Date Fair Value RSUs outstanding at December 31, 2021 241 $ 3.41 RSUs granted 405 2.26 RSUs released (241 ) 3.41 RSUs forfeited - 0.00 RSUs outstanding at December 31, 2022 405 $ 2.26 Weighted average remaining recognition period in years 3.5 Unamortized stock-based compensation expense $ 778 |
Stock option activity | (in thousands except exercise price and contractual term) Shares Weighted Average Exercise Price Intrinsic Value Weighted Average Remaining Contractual Term Options outstanding at December 31, 2021 44,920 $ 1.78 - - Options granted 8,010 3.84 - - Options exercised (634 ) 0.57 - - Options cancelled (2,720 ) 3.08 - - Options outstanding at December 31, 2022 49,576 $ 2.06 $ 14,364 4.52 years Options exercisable at December 31, 2022 24,626 $ 1.44 $ 10,713 4.49 years Vested and expected to vest at December 31, 2022 49,576 $ 2.06 $ 14,364 4.52 years |
Schedule of assumptions of stock options granted | Years Ended December 31, 2022 2021 Weighted risk-free interest rate 1 2.5 % 0.4 % Weighted-average volatility 2 257 % 412 % Weighted expected dividend yield 3 - % - % Weighted expected term (in years) 4 4.2 3.4 |
Warrant activity | (in thousands except exercise price and contractual life) Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life Warrants outstanding at January 1, 2021 19,845 $ 1.26 3.5 years Issued 4,240 4.00 2.1 years Exercised - - N/A Expired - - N/A Warrants outstanding at December 31, 2021 24,085 $ 1.74 3.0 years Warrants exercisable at December 31, 2021 24,085 $ 1.74 3.0 years Issued 2,000 8.50 2.8 years Exercised (8,183 ) (1.59 ) N/A Expired - - N/A Warrants outstanding at December 31, 2022 17,902 $ 2.56 1.8 years Warrants exercisable at December 31, 2022 17,902 $ 2.56 1.8 years |
Schedule of non-cash stock-based compensation expense | Years Ended December 31, (in thousands) 2022 2021 Stock-based compensation $ 35,449 $ 30,623 Income tax benefit (1) 276 2,408 After-tax stock-based compensation expense $ 35,173 $ 28,215 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income taxes | |
Components of income tax expense | Years Ended December 31, (in thousands) 2022 2021 Current: Federal $ - $ - State and local 965 37 Total 965 37 Deferred: Federal (334 ) (5,403 ) State and local (356 ) 74 Total (690 ) (5,329 ) Total income tax expense (benefit) $ 275 $ (5,292 ) |
Schedule of effective income tax reconciliation | Years Ended December 31, 2022 2021 U.S. statutory federal income tax rate 21.0 % 21.0 % Change in valuation allowance (36.9 ) (1.3 ) Convertible Debt (4.1 ) - Derivative Expense 23.7 - Incentive Stock Options (1.2 ) (3.8 ) Deferred Consideration (1.9 ) - Goodwill impairment - (6.2 ) Vesting & Exercises 1.0 - 162m limitation (2.2 ) - Other (0.3 ) (0.2 ) Income tax rate (0.9 )% 9.5 % |
Deferred tax assets (liabilities) | (in thousands) December 31, 2022 December 31, 2021 Deferred tax assets: Net operating loss carryforwards $ 3,990 $ 4,916 Capital Loss Carryforward 64 - Stock-based compensation expense 11,282 4,677 Allowance for bad debts 81 62 163 (j)Limitation 1,567 255 Fixed assets 618 406 Unrealized Gains/(loss) 441 197 Foreign exchange gains (losses) 12 - Other 132 6 Total gross deferred tax assets 18,187 10,519 Less: valuation allowance (13,278 ) (4,920 ) Net deferred tax assets 4,909 5,599 Deferred tax liabilities: Goodwill (3 ) - Intangible Asset (6,295 ) - Foreign exchange gains (losses) - (19 ) Total gross deferred tax liabilities (6,298 ) (19 ) Net deferred tax assets (liabilities) $ (1,389 ) $ 5,580 |
Changes in the deferred tax asset valuation allowance | (in thousands) Balance at Beginning of Year Increase (Decrease) Charged (Credited) to Income Taxes (Benefit) Balance at End of Year Year ended December 31, 2022 $ 4,920 $ 8,358 $ 13,278 December 31, 2021 3,769 1,151 4,920 |
Nature of operations (Details N
Nature of operations (Details Narrative) - shares | Dec. 31, 2022 | Apr. 30, 2020 |
Series D Preferred stock [Member] | ||
Preferred stock issued | 1,177,023 | 1,000,000 |
Series F Preferred Stock [Member] | ||
Preferred stock issued | 1,000,000 |
Summary of significant accoun_4
Summary of significant accounting policies (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Computer Software [Member] | |
Property, plant and equipment, estimated useful lives | 3 years |
Leasehold Improvements | |
Property, plant and equipment, estimated useful lives | Lesser of life of lease or asset life |
Computer Hardware [Member] | Maximum [Member] | |
Property, plant and equipment, estimated useful lives | 5 years |
Computer Hardware [Member] | Minimum [Member] | |
Property, plant and equipment, estimated useful lives | 3 years |
Equipment [Member] | Maximum [Member] | |
Property, plant and equipment, estimated useful lives | 7 years |
Equipment [Member] | Minimum [Member] | |
Property, plant and equipment, estimated useful lives | 2 years |
Vehicles [Member] | Maximum [Member] | |
Property, plant and equipment, estimated useful lives | 5 years |
Vehicles [Member] | Minimum [Member] | |
Property, plant and equipment, estimated useful lives | 3 years |
Furniture And Fixtures [Member] | Maximum [Member] | |
Property, plant and equipment, estimated useful lives | 7 years |
Furniture And Fixtures [Member] | Minimum [Member] | |
Property, plant and equipment, estimated useful lives | 5 years |
Summary of significant accoun_5
Summary of significant accounting policies (Details 1) - shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders | 116,258 | 101,299 |
Convertible Notes Payable [Member] | ||
Potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders | 24,847 | 43,832 |
Stock Options [Member] | ||
Potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders | 48,986 | 34,740 |
Restricted Stock Units [Member] | ||
Potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders | 196 | 65 |
Warrants [Member] | ||
Potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders | 20,552 | 21,097 |
Preferred Stock [Member] | ||
Potential common shares were excluded from the calculation of diluted net income (loss) per share available to common stockholders | 21,677 | 1,565 |
Summary of significant accoun_6
Summary of significant accounting policies (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Summary of significant accounting policies | |||
Advertising expense | $ 800,000 | $ 300,000 | |
Stock-based compensation | $ 7,100,000 | 35,500,000 | |
Accumulated deficit | 200,000 | 200,000 | |
Restricted cash | 900,000 | 900,000 | 0 |
Beneficial conversion feature, amount | 2,700,000 | 2,700,000 | $ 3,600,000 |
Additional paid in capital | $ 300,000 | $ 300,000 |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Marketable securities | $ 6,757,000 | $ 9,619,000 | ||
Derivative liabilities | 6,521,000 | $ 40,400,000 | 0 | $ 750,000 |
Level 2 [Member] | ||||
Derivative liabilities | 6,521,000 | 0 | ||
Level 3 [Member] | ||||
Contingent consideration | 0 | 0 | ||
Level 1 [Member] | ||||
Marketable securities | $ 6,757,000 | $ 9,619,000 |
Fair value measurements (Deta_2
Fair value measurements (Details Narrative) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Contingent liability | $ 3.5 | |
Nonrecurring Fair Value Measurements [Member] | ||
Increases in the fair value of the non-marketable securities | 0.1 | $ 0 |
Non-marketable securities | $ 0.2 | $ 0.1 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Revenue | ||
Receivables included in "Accounts receivable net of allowances" | $ 72,405 | $ 73,334 |
Cost in excess of billings | 6,090 | 4,812 |
Deferred revenue - current | $ 13,741 | $ 7,018 |
Revenue (Details 1)
Revenue (Details 1) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Revenue | |
Balance at December 31, 2021 | $ 7,018 |
Revenue recognized during the period that was included in the beginning balance | (6,484) |
Additions, net of revenue recognized during the period | 13,207 |
Balance at December 31, 2022 | $ 13,741 |
Revenue (Details 2)
Revenue (Details 2) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues | $ 697,833 | $ 477,018 |
Telecommunication [Member] | ||
Revenues | 592,310 | 452,767 |
Infrastructures [Member] | ||
Revenues | $ 105,523 | $ 24,251 |
Marketable securities and oth_3
Marketable securities and other investments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Marketable Securities Fair Value | $ 6,757 | $ 9,619 |
Brokerage Account | ||
Marketable Securities Fair Value | 6,757 | 9,588 |
Other Securities | ||
Marketable Securities Fair Value | $ 0 | $ 31 |
Marketable securities and oth_4
Marketable securities and other investments (Details Narrative) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Marketable securities and other investments | ||
Recognized net losses | $ 0.8 | $ 3.3 |
Realized losses | 0.2 | 4.2 |
Unrealized losses | 0.7 | $ 0.9 |
Marketable securities offset | $ 0.1 |
Business acquisitions (Details)
Business acquisitions (Details) - USD ($) | 1 Months Ended | ||||
Jan. 14, 2022 | May 07, 2021 | Dec. 27, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Common stock (5,201,863 shares) | $ 20,000 | $ 18,000 | |||
Goodwill | 12,672,000 | 26,055,000 | |||
Deferred tax liability | $ 1,389 | $ 0 | |||
Measurement Period Adjustments [Member] | |||||
Accrued Expenses | $ 0 | ||||
Contingent consideration liability, net of $72 contingent consideration asset | 0 | ||||
Common stock (5,201,863 shares) | 0 | $ 0 | |||
Total Consideration | 0 | $ 363,000 | 2,450,000 | ||
Cash | 0 | $ 363,000 | $ 2,450,000 | ||
EV Group Holdings LLC [Member] | |||||
Cash | 104,000 | ||||
Deposits, prepaids and other current assets, net | 5,000 | ||||
Non-current assets | 391,000 | ||||
Operating lease right-of-use asset | 2,496,000 | ||||
Goodwill | 6,730,000 | ||||
Intangible Assets, net | 15,921,000 | ||||
Total assets | 25,647,000 | ||||
Accrued liabilities | 44,000 | ||||
Deferred revenue | 167,000 | ||||
Operating lease liability | 2,017,000 | ||||
Deferred tax liability | 4,632,000 | ||||
Total liabilities | 6,860,000 | ||||
Total fair value of identifiable net assets and liabilities | 18,787,000 | ||||
EV Group Holdings LLC [Member] | Preliminary Estimates [Member] | |||||
Net Cash | 1,231,000 | ||||
Accrued Expenses | 19,000 | ||||
Contingent consideration liability, net of $72 contingent consideration asset | 7,000 | ||||
Common stock (5,201,863 shares) | 17,530,000 | ||||
Total Consideration | 18,787,000 | ||||
Cash | 104,000 | ||||
Deposits, prepaids and other current assets, net | 5,000 | ||||
Non-current assets | 391,000 | ||||
Operating lease right-of-use asset | 2,017,000 | ||||
Goodwill | 18,498,000 | ||||
Intangible Assets, net | 0 | ||||
Total assets | 21,015,000 | ||||
Accrued liabilities | 44,000 | ||||
Deferred revenue | 167,000 | ||||
Operating lease liability | 2,017,000 | ||||
Deferred tax liability | 0 | ||||
Total liabilities | 2,228,000 | ||||
Total fair value of identifiable net assets and liabilities | 18,787,000 | ||||
EV Group Holdings LLC [Member] | Measurement Period Adjustments [Member] | |||||
Accrued Expenses | 0 | ||||
Contingent consideration liability, net of $72 contingent consideration asset | 0 | ||||
Common stock (5,201,863 shares) | 0 | ||||
Total Consideration | 0 | ||||
Cash | 0 | ||||
Deposits, prepaids and other current assets, net | 0 | ||||
Non-current assets | 0 | ||||
Operating lease right-of-use asset | 479,000 | ||||
Goodwill | (11,768,000) | ||||
Intangible Assets, net | 15,921,000 | ||||
Total assets | 4,632,000 | ||||
Accrued liabilities | 0 | ||||
Deferred revenue | 0 | ||||
Operating lease liability | 0 | ||||
Deferred tax liability | 4,632,000 | ||||
Total liabilities | 4,632,000 | ||||
Total fair value of identifiable net assets and liabilities | 0 | ||||
Final [Member] | EV Group Holdings LLC [Member] | |||||
Net Cash | 1,231,000 | ||||
Accrued Expenses | 19,000 | ||||
Contingent consideration liability, net of $72 contingent consideration asset | 7,000 | ||||
Common stock (5,201,863 shares) | 17,530,000 | ||||
Total Consideration | $ 18,787,000 |
Business acquisitions (Details
Business acquisitions (Details 1) - USD ($) | 1 Months Ended | ||||
Jan. 14, 2022 | May 07, 2021 | Dec. 27, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Common stock (1,285,714 shares) | $ 20,000 | $ 18,000 | |||
Investments in marketable securities | 6,757,000 | 9,619,000 | |||
Cost in excess of billings | 6,090,000 | 4,812,000 | |||
Goodwill | $ 12,672,000 | $ 26,055,000 | |||
Measurement Period Adjustments [Member] | |||||
Common stock (1,285,714 shares) | $ 0 | $ 0 | |||
Total Consideration | 0 | $ 363,000 | 2,450,000 | ||
Cash | $ 0 | $ 363,000 | 2,450,000 | ||
B W Electrical Services LLC [Member] | Measurement Period Adjustments [Member] | |||||
Operating lease liability | 0 | ||||
Note payable | 2,000,000 | ||||
Total liabilities | (2,459,000) | ||||
Total fair value of identifiable net assets and liabilities | 2,450,000 | ||||
Cash | 0 | ||||
Accounts receivable | 0 | ||||
Investments in marketable securities | 0 | ||||
Cost in excess of billings | 0 | ||||
Property, plant, and equipment | 0 | ||||
Deposits, prepaids and other current assets, net | 0 | ||||
Operating lease right-of-use asset | 0 | ||||
Goodwill | (11,578,000) | ||||
Intangible Assets, net | 11,569,000 | ||||
Total assets | (9,000) | ||||
Accounts payable | 0 | ||||
Accrued liabilities | (459,000) | ||||
Deferred revenue | 0 | ||||
Total assets | 9,000 | ||||
Total liabilities | 2,459,000 | ||||
B W Electrical Services LLC [Member] | Preliminary Estimates [Member] | |||||
Net Cash | 13,500,000 | ||||
Common stock (1,285,714 shares) | 4,539,000 | ||||
Total Consideration | 18,039,000 | ||||
Operating lease liability | 1,071,000 | ||||
Note payable | 2,000,000 | ||||
Total liabilities | (8,311,000) | ||||
Total fair value of identifiable net assets and liabilities | 18,039,000 | ||||
Cash | 3,068,000 | ||||
Accounts receivable | 0 | ||||
Investments in marketable securities | 0 | ||||
Cost in excess of billings | 970,000 | ||||
Property, plant, and equipment | 105,000 | ||||
Deposits, prepaids and other current assets, net | 93,000 | ||||
Operating lease right-of-use asset | 1,071,000 | ||||
Goodwill | 11,730,000 | ||||
Intangible Assets, net | 0 | ||||
Total assets | (26,350,000) | ||||
Accounts payable | 1,306,000 | ||||
Accrued liabilities | 1,663,000 | ||||
Deferred revenue | 2,271,000 | ||||
Total assets | 26,350,000 | ||||
Total liabilities | 8,311,000 | ||||
Final [Member] | B W Electrical Services LLC [Member] | |||||
Net Cash | 15,950,000 | ||||
Common stock (1,285,714 shares) | 4,539,000 | ||||
Total Consideration | 20,489,000 | ||||
Operating lease liability | 1,071,000 | ||||
Note payable | 0 | ||||
Total liabilities | (5,852,000) | ||||
Total fair value of identifiable net assets and liabilities | 20,489,000 | ||||
Cash | 3,068,000 | ||||
Accounts receivable | 7,033,000 | ||||
Investments in marketable securities | 2,280,000 | ||||
Cost in excess of billings | 970,000 | ||||
Property, plant, and equipment | 970,000 | ||||
Deposits, prepaids and other current assets, net | 93,000 | ||||
Operating lease right-of-use asset | 1,071,000 | ||||
Goodwill | 152,000 | ||||
Intangible Assets, net | 11,569,000 | ||||
Total assets | (26,341,000) | ||||
Accounts payable | 1,306,000 | ||||
Accrued liabilities | 1,204,000 | ||||
Deferred revenue | 2,271,000 | ||||
Total assets | 26,341,000 | ||||
Total liabilities | $ 5,852,000 |
Business acquisitions (Detail_2
Business acquisitions (Details 2) - USD ($) $ in Thousands | 1 Months Ended | ||||
Jan. 14, 2022 | May 07, 2021 | Dec. 27, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Finance lease asset | $ 341 | $ 470 | |||
Goodwill | 12,672 | 26,055 | |||
Finance lease liability | $ 112 | $ 159 | |||
Final [Member] | Preferred Stock B [Member] | |||||
Series B preferred stock (2,395,105 shares) | $ 6,850 | ||||
ANS [Member] | Final [Member] | |||||
Net Cash | 13,311 | ||||
Total Consideration | 20,161 | ||||
Cash | 0 | ||||
Accounts receivable | 6,492 | ||||
Inventory | 171 | ||||
Deposits and prepaids | 512 | ||||
Accrued revenue | 1,620 | ||||
Other current assets | 2,289 | ||||
Property, plant, and equipment | 680 | ||||
Finance lease asset | 229 | ||||
Operating lease right-of-use asset | 603 | ||||
Goodwill | 5,018 | ||||
Intangible Assets, net | 11,925 | ||||
Total assets | 29,539 | ||||
Accounts payable | 2,638 | ||||
Accrued liabilities | 1,149 | ||||
Line of credit acquired | 1,785 | ||||
Net deferred tax liability acquired | 3,027 | ||||
Finance lease liability | 176 | ||||
Operating lease liability | 603 | ||||
Total liabilities | 9,378 | ||||
Total fair value of identifiable net assets and liabilities | 20,161 | ||||
Measurement Period Adjustments [Member] | |||||
Series B preferred stock (2,395,105 shares) | 0 | ||||
Total Consideration | $ 0 | 363 | $ 2,450 | ||
Cash | $ 0 | 363 | $ 2,450 | ||
Measurement Period Adjustments [Member] | ANS [Member] | |||||
Cash | 0 | ||||
Accounts receivable | 0 | ||||
Inventory | 0 | ||||
Deposits and prepaids | 0 | ||||
Accrued revenue | 0 | ||||
Other current assets | 0 | ||||
Property, plant, and equipment | 0 | ||||
Finance lease asset | 0 | ||||
Operating lease right-of-use asset | 0 | ||||
Goodwill | (8,400) | ||||
Intangible Assets, net | 11,925 | ||||
Total assets | 3,525 | ||||
Accounts payable | 0 | ||||
Accrued liabilities | 135 | ||||
Line of credit acquired | 0 | ||||
Net deferred tax liability acquired | 3,027 | ||||
Finance lease liability | 0 | ||||
Operating lease liability | 0 | ||||
Total liabilities | 3,162 | ||||
Total fair value of identifiable net assets and liabilities | 363 | ||||
Preliminary Estimates [Member] | ANS [Member] | |||||
Net Cash | 12,948 | ||||
Series B preferred stock (2,395,105 shares) | 6,850 | ||||
Total Consideration | 19,798 | ||||
Cash | 0 | ||||
Accounts receivable | 6,492 | ||||
Inventory | 171 | ||||
Deposits and prepaids | 512 | ||||
Accrued revenue | 1,620 | ||||
Other current assets | 2,289 | ||||
Property, plant, and equipment | 680 | ||||
Finance lease asset | 229 | ||||
Operating lease right-of-use asset | 603 | ||||
Goodwill | 13,418 | ||||
Intangible Assets, net | 0 | ||||
Total assets | 26,014 | ||||
Accounts payable | 2,638 | ||||
Accrued liabilities | 1,014 | ||||
Line of credit acquired | 1,785 | ||||
Net deferred tax liability acquired | 0 | ||||
Finance lease liability | 176 | ||||
Operating lease liability | 603 | ||||
Total liabilities | 6,216 | ||||
Total fair value of identifiable net assets and liabilities | $ 19,798 |
Business acquisitions (Detail_3
Business acquisitions (Details Narrative) - USD ($) $ in Millions | Dec. 31, 2022 | Jan. 14, 2022 | Dec. 31, 2021 | Dec. 22, 2021 | May 07, 2021 |
Common Stock Issued | 206,844,580 | 184,266,934 | |||
ANS [Member] | |||||
Aggregate Purchase Price Payable to Shareholders | $ 6.9 | ||||
Issued and outstanding shares, aggregate purchase price | $ 19.8 | ||||
ANS [Member] | Preferred Stock B [Member] | |||||
Preferred Stock Issued | 2,395,105 | ||||
B W Electrical Services LLC [Member] | |||||
Non-compete agreement intangible asset | $ 0.1 | ||||
Customer Relationship intangible asset | 7.6 | ||||
Contract backlog intangible asset | 3.3 | ||||
Brand intangible asset | 0.6 | ||||
SBA loan | 2 | ||||
Aggregate Purchase Price Payable to Shareholders | 4.5 | ||||
Issued and outstanding shares, aggregate purchase price | $ 18 | ||||
Common Stock Issued | 1,285,714 | ||||
EV Depot [Member] | |||||
Non-compete agreement intangible asset | $ 3.6 | ||||
Customer Relationship intangible asset | 11.3 | ||||
Finite lived favorable leases intangible asset | 1 | ||||
Operating lease right-of-use asset related deferred tax liabilities | 0.5 | ||||
Aggregate Purchase Price Payable to Shareholders | $ 17.5 | ||||
Aggregate purchase price | $ 18.8 | ||||
Issuance of shares of common stock | 5,201,863 | ||||
Contingent consideration liability | $ 0.8 | $ 3.5 |
Goodwill and intangible asset_2
Goodwill and intangible assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Total [Member] | ||
Goodwill, gross, Beginning Balance | $ 53,382,000 | $ 27,876,000 |
Additions | 18,497,000 | 25,148,000 |
Measurement period adjustments | (31,880,000) | 358,000 |
Goodwill, gross, Ending Balance | 39,999,000 | 53,382,000 |
Accumulated impairment, Beginning Balance | (27,327,000) | (10,700,000) |
Impairment | 0 | (16,627,000) |
Accumulated impairment, Ending Balance | (27,327,000) | (27,327,000) |
Goodwill, net | 12,672,000 | 26,055,000 |
Impairment | 0 | 16,627,000 |
Infrastructure [Member] | ||
Goodwill, gross, Beginning Balance | 52,610,000 | 27,327,000 |
Additions | 18,497,000 | 25,148,000 |
Measurement period adjustments | (31,880,000) | 135,000 |
Goodwill, gross, Ending Balance | 39,227,000 | 52,610,000 |
Accumulated impairment, Beginning Balance | (27,327,000) | (10,700,000) |
Impairment | 0 | (16,627,000) |
Accumulated impairment, Ending Balance | (27,327,000) | (27,327,000) |
Goodwill, net | 11,900,000 | 25,283,000 |
Impairment | 0 | 16,627,000 |
Telecommunications [Member] | ||
Goodwill, gross, Beginning Balance | 772,000 | 549,000 |
Additions | 0 | 0 |
Measurement period adjustments | 0 | 223,000 |
Goodwill, gross, Ending Balance | 772,000 | 772,000 |
Accumulated impairment, Beginning Balance | 0 | 0 |
Impairment | 0 | 0 |
Accumulated impairment, Ending Balance | 0 | 0 |
Goodwill, net | 772,000 | 772,000 |
Impairment | $ 0 | $ 0 |
Goodwill and intangible asset_3
Goodwill and intangible assets (Details 1) | 3 Months Ended |
Dec. 31, 2022 | |
Discount Rate | 15.5 |
Terminal value growth rate | 3 |
Maximum | |
Forecasted revenue growth rates | 42% |
Minimum [Member] | |
Forecasted revenue growth rates | 3% |
Goodwill and intangible asset_4
Goodwill and intangible assets (Details 2) | Dec. 31, 2022 USD ($) |
Gross Carrying Amount | $ 39,415,000 |
Accumulated Amortization | 5,483,000 |
Net Carrying Amount | 33,932,000 |
Customer Relationships | |
Gross Carrying Amount | 30,849,000 |
Accumulated Amortization | 2,489,000 |
Net Carrying Amount | 28,360,000 |
Backlog [Member] | |
Gross Carrying Amount | 3,322,000 |
Accumulated Amortization | 1,107,000 |
Net Carrying Amount | 2,215,000 |
Non-compete agreements [Member] | |
Gross Carrying Amount | 3,729,000 |
Accumulated Amortization | 895,000 |
Net Carrying Amount | 2,834,000 |
Off-market favorable leases [Member] | |
Gross Carrying Amount | 955,000 |
Accumulated Amortization | 955,000 |
Net Carrying Amount | 0 |
Brand [Member] | |
Gross Carrying Amount | 560,000 |
Accumulated Amortization | 37,000 |
Net Carrying Amount | $ 523,000 |
Goodwill and intangible asset_5
Goodwill and intangible assets (Details 3) $ in Thousands | Dec. 31, 2022 USD ($) |
Goodwill and intangible assets | |
2023 | $ 4,134 |
2024 | 4,134 |
2025 | 3,026 |
2026 | 2,132 |
2027 | 2,094 |
Thereafter | 18,412 |
Total amortization expense | $ 33,932 |
Goodwill and intangible asset_6
Goodwill and intangible assets (Details Narrative) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2022 | |
Total definite-lived intangible assets | 12 years 8 months 12 days | ||
ANS [Member] | |||
Amortization expense | $ 0.9 | $ 5.5 | |
EV Depot [Member] | |||
Amortization expense | $ 2.5 | ||
BW [Member] | |||
Amortization expense | $ 1.7 | ||
Customer Relationships | |||
Weighted average amortization period | 15 years | ||
Backlog [Member] | |||
Weighted average amortization period | 3 years | ||
Non-compete agreements [Member] | |||
Weighted average amortization period | 4 years | ||
Off-market favorable leases [Member] | |||
Weighted average amortization period | 1 year | ||
Brand [Member] | |||
Weighted average amortization period | 15 years |
Property Plant and Equipment (D
Property Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property and equipment, gross | $ 8,631 | $ 9,372 |
Less: accumulated depreciation | (7,899) | (7,360) |
Property, plant, and equipment, net | 732 | 2,012 |
Computer Software [Member] | ||
Property and equipment, gross | 37 | 37 |
Leasehold Improvements | ||
Property and equipment, gross | 6 | 6 |
Furniture And Fixtures [Member] | ||
Property and equipment, gross | 112 | 106 |
Vehicles [Member] | ||
Property and equipment, gross | 2,794 | 2,831 |
Equipment [Member] | ||
Property and equipment, gross | 5,214 | 5,924 |
Computer Hardware | ||
Property and equipment, gross | $ 468 | $ 468 |
Property Plant and Equipment _2
Property Plant and Equipment (Details Narrative) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, plant, and equipment | ||
Depreciation | $ 0.9 | $ 0.5 |
Related Party (Details Narrativ
Related Party (Details Narrative) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Mr. Deutsch [Member] | ||
Options acquire to common stock, shares | 1,500,000 | |
Exercise Price | $ 2 | |
Korr Acquisition Group Inc. [Member] | ||
Advisory fee | $ 0.3 | $ 0.3 |
Ongoing fee | $ 0.5 |
Debt (Details)
Debt (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Total current portion of long-term debt | $ 29,180,000 | $ 4,598,000 |
Long-Term Debt [Member] | ||
Convertible Notes Payable Issued on May 8, 2020 | 0 | 3,000,000 |
Convertible Notes Payable Issued on November 3, 2020 | 0 | 3,889,000 |
Convertible Notes Payable Issued on May 19, 2021 | 0 | 5,610,000 |
Convertible Notes Payable Issued on April 30, 2021 | 0 | 66,000 |
Total Face Value of Convertible Notes Payable | 0 | 12,565,000 |
Less: Unamortized Discount | 0 | (5,389,000) |
Net Carrying Value of Convertible Notes Payable | 0 | 7,176,000 |
ANS Line of Credit | 5,024,000 | 1,898,000 |
Total Line of Credit | 5,024,000 | 1,898,000 |
Notes Payable Paycheck Protection Program | 0 | 2,000,000 |
Notes Payable Issued on May 19, 2021 | 11,860,000 | 11,860,000 |
Notes Payable Issued on December 17, 2021 | 15,926,000 | 15,926,000 |
Unamortized Discount | (3,630) | (3,699) |
Total Face Value of Notes Payable | 27,786,000 | 29,786,000 |
Net Carrying Value of Notes Payable | 24,156,000 | 26,087,000 |
Before deferred financing costs | 29,180,000 | 35,161,000 |
Current amount of Convertible Notes Payable | 0 | 2,700,000 |
Current amount of Notes Payable | 24,156,000 | 0 |
Current amount of Line of Credit | 5,024,000 | 1,898,000 |
Total current portion of long-term debt | 29,180,000 | 4,598,000 |
Total long-term debt, net of current portion | $ 0 | $ 30,563,000 |
Debt (Details 1)
Debt (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Amortization of debt discount | $ 9,346,000 | $ 3,056,000 |
Amortization of debt discount, related party | 0 | 95,000 |
Interest expense | (11,905,000) | (4,619,000) |
Notes Payable [Member] | ||
Interest expense | (2,559,000) | (1,458,000) |
Amortization of debt issue costs | 0 | (10,000) |
Amortization of debt discount | (9,346,000) | (3,056,000) |
Amortization of debt discount, related party | 0 | (95,000) |
Interest expense | $ (11,905,000) | $ (4,619,000) |
Debt (Details 2)
Debt (Details 2) | Dec. 31, 2022 USD ($) |
Line Of Credit [Member] | |
2023 | $ 5,024,000 |
2024 | 0 |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Total | 5,024,000 |
Notes Payable [Member] | |
2023 | 27,786,000 |
2024 | 0 |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Total | 27,786,000 |
Aggregate Principal Maturities [Member] | |
2023 | 32,810,000 |
2024 | 0 |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Total | $ 32,810,000 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) | 1 Months Ended | 2 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||||
May 22, 2021 | Nov. 03, 2020 | Sep. 02, 2020 | May 06, 2020 | Nov. 18, 2022 | Dec. 17, 2021 | May 19, 2021 | Apr. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 25, 2022 | Mar. 31, 2022 | Mar. 15, 2021 | Aug. 27, 2020 | |
Interest expense and amortization of debt discount | $ 100,000 | |||||||||||||||
Description of line of credit | Advances under the line of credit are limited to 75% of BW’s eligible accounts receivable. At all times during the loan term BW is required to maintain a minimum increase in the net retained earnings of $0.2 million tested annually | |||||||||||||||
Common Stock, Issued | 206,844,580 | 184,266,934 | ||||||||||||||
Conversion of stock | $ 685,000 | |||||||||||||||
Line Of Credit [Member] | ||||||||||||||||
Line Of Credit Available With A Bank | $ 8 | |||||||||||||||
Lenders Index Rate | 7.50% | 3.25% | ||||||||||||||
Interest rate | 5% | |||||||||||||||
Percentage of advances against the line of credit | 50% | 70% | ||||||||||||||
Outstanding balance of line of credit | $ 5,000,000 | $ 1,900,000 | ||||||||||||||
Line Of Credit available with the bank | $ 8,000,000 | $ 4,000,000 | ||||||||||||||
Line Of Credit [Member] | BW [Member] | ||||||||||||||||
Line Of Credit Available With A Bank | 3 | |||||||||||||||
Lenders Index Rate | 3.25% | 7.50% | ||||||||||||||
Line Of Credit [Member] | ANS [Member] | ||||||||||||||||
Line Of Credit Available With A Bank | $ 750,000 | |||||||||||||||
Collateral | There are no financial commitments or covenants on the line of credit. As of December 31, 2022 | |||||||||||||||
Outstanding balance of line of credit | $ 0 | |||||||||||||||
Federal Home Loan Bank rate | 2.50% | |||||||||||||||
May 2021 Financing | ||||||||||||||||
Maturity date | May 19, 2024 | |||||||||||||||
Aggregate purchase price | $ 5,000,000 | |||||||||||||||
Convertible notes aggregate principal amount | $ 5,600,000 | |||||||||||||||
Common Stock, Issued | 1,870,000 | |||||||||||||||
Accrued interest rate | 8% | |||||||||||||||
Conversion price | $ 3 | |||||||||||||||
Convertible Convertible note | 1,177,023 | |||||||||||||||
Paycheck Protection Program [Member] | Notes Payable [Member] | ||||||||||||||||
Reimburse The Sba Loan | $ 2 | $ 2 | ||||||||||||||
Paycheck Protection Program loan | $ 2 | |||||||||||||||
KORR Value Financing [Member] | ||||||||||||||||
Aggregate purchase price | $ 500,000 | |||||||||||||||
Convertible notes aggregate principal amount | $ 600,000 | |||||||||||||||
Common Stock, Issued | 1,151,515 | |||||||||||||||
Warrants assigned to unrelated party | 658,667 | |||||||||||||||
Convertible Notes Payable | $ 300,000 | $ 300,000 | ||||||||||||||
Number of shares of common stock | 1,115,638 | |||||||||||||||
9 Madison [Member] | ||||||||||||||||
Aggregate purchase price | $ 100,000 | |||||||||||||||
Convertible notes | $ 100,000 | $ 100,000 | ||||||||||||||
Conversion price | $ 0.25 | |||||||||||||||
Warrant issued to common stock | 440,000 | |||||||||||||||
Number of shares of common stock | 458,709 | |||||||||||||||
Sutton Global | ||||||||||||||||
Initial conversion price | $ 0.0005 | |||||||||||||||
Convertible note face value | $ 300,000 | |||||||||||||||
Coupon rate | 6% | |||||||||||||||
loss on modification of debt | $ 100,000 | |||||||||||||||
Conversion of stock | $ 200,000 | |||||||||||||||
Conversion in common stock | 319,950 | |||||||||||||||
Conversion of stock shares | 644,499 | |||||||||||||||
May 2020 Financing | ||||||||||||||||
Warrants to purchase | 7,600,000 | |||||||||||||||
Maturity date | May 08, 2023 | |||||||||||||||
Interest rate | 8% | |||||||||||||||
Initial conversion price | $ 0.25 | |||||||||||||||
Maximum ownership | 9.99% | |||||||||||||||
Convertible notes description | (i) $0.01 or (ii) 75% of the volume-weighted average price (“VWAP”) of the common stock for the immediately preceding five (5) Trading Days on the date of conversion. The conversion price was also subject to adjustment due to certain events, including stock dividends, and stock splits. The May 2020 Convertible Notes were able to be redeemed by the Company, in its sole discretion, in an amount equal to 110% of the principal amount | |||||||||||||||
Convertible notes aggregate principal amount | $ 3,000,000 | |||||||||||||||
Purchase price of convertible notes payable | $ 2,700,000 | |||||||||||||||
November 2020 Financing | ||||||||||||||||
Maturity date | Nov. 03, 2024 | |||||||||||||||
Initial conversion price | $ 0.25 | |||||||||||||||
Aggregate purchase price | $ 3,500,000 | |||||||||||||||
Convertible notes aggregate principal amount | $ 3,900,000 | |||||||||||||||
Common Stock, Issued | 903,226 | |||||||||||||||
Accrued interest rate | 8% | |||||||||||||||
May 19'2021 [Member] | Notes Payable [Member] | ||||||||||||||||
Notes payable issued | $ 11,800,000 | |||||||||||||||
Aggregate Purchase Price | $ 10,000,000 | |||||||||||||||
Notes Coupon | 8% | |||||||||||||||
Note Coupon May | 7.50% | |||||||||||||||
December 17, 2021 [Member] | Notes Payable [Member] | ||||||||||||||||
Aggregate Purchase Price | $ 13,300,000 | |||||||||||||||
Notes payable issued | $ 15,900,000 | |||||||||||||||
Note Coupon | 7.50% |
Derivative liabilities (Details
Derivative liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Derivative liabilities | ||
Derivative liability balance at January 1 | $ 0 | $ 750 |
Reclassification of derivative to Additional Paid in Capital | 0 | (750) |
Reclassification of warrants to derivative liability | 40,442 | 0 |
Change in fair value of derivative liabilities | (33,921) | 0 |
Derivative liability balance at December 31 | $ 6,521 | $ 0 |
Derivative liabilities (Detai_2
Derivative liabilities (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Derivative liabilities | ||||
Derivative liability | $ 6,521 | $ 40,400 | $ 0 | $ 750 |
Derivative deemed dividend | $ 32,800 |
Leases (Details)
Leases (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Amortization of right-of-use assets | $ 207,000 | $ 139,000 |
Interest on lease liabilities | 46,000 | 58,000 |
Total finance lease cost | 253,000 | 197,000 |
Operating lease costs: | ||
Operating lease cost | 1,647,000 | 71,000 |
Variable lease cost | 838,000 | 0 |
Short-term lease cost | 50,000 | 11,000 |
Total operating lease cost | 2,535,000 | 82,000 |
Total lease cost | $ 2,788,000 | $ 279,000 |
Leases (Details 1)
Leases (Details 1) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Weighted Average Remaining Lease Term | ||
Operating lease | 2 years 1 month 6 days | 6 years 3 months 18 days |
Finance lease | 2 years 8 months 12 days | 3 years |
Weighted Average Discount Rate | ||
Operating lease | 3.40% | 3% |
Finance lease | 9% | 8.50% |
Leases (Details 2)
Leases (Details 2) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Operating cash flows from operating leases | $ 2,470 | $ 121 |
Operating cash flows from finance leases | 29 | 26 |
Financing cash flows from finance leases | 167 | 133 |
Right-of-use assets obtained in exchange for lease obligations | ||
Operating lease | 4,964 | 1,558 |
Finance leases | $ 47 | $ 270 |
Leases (Details 3)
Leases (Details 3) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2023 | $ 1,727 | |
2024 | 968 | |
2025 | 773 | |
2026 | 212 | |
2027 | 164 | |
Thereafter | 155 | |
Total future minimum lease payments | 3,999 | |
Less imputed interest | (221) | |
Present value of lease liability | 3,778 | |
Finance Leases | ||
2023 | 130 | |
2024 | 91 | |
2025 | 71 | |
2026 | 10 | |
2027 | 0 | |
Thereafter | 0 | |
Total future minimum lease payments | 302 | |
Less imputed interest | (44) | |
Present value of lease liability | 112 | $ 159 |
Total Leases | ||
Finance Leases | ||
2023 | 1,857 | |
2024 | 1,059 | |
2025 | 844 | |
2026 | 222 | |
2027 | 164 | |
Thereafter | 155 | |
Total future minimum lease payments | 4,301 | |
Less imputed interest | (265) | |
Present value of lease liability | $ 4,036 |
Leases (Details 4)
Leases (Details 4) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Fixed component | $ 4,792 | $ 0 |
Variable component | 0 | 0 |
Total | $ 4,792 | $ 0 |
Leases (Details 5)
Leases (Details 5) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases | |
2023 | $ 2,828 |
2024 | 1,018 |
2025 | 770 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Total | $ 4,616 |
Reportable segments (Details)
Reportable segments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income (loss) from operations | ||
Telecommunications | $ 1,227 | $ 1,679 |
Infrastructure | 3,198 | 586 |
Non-operating corporate | (52,387) | (40,549) |
Total (loss) from operations | $ (47,962) | $ (38,284) |
Reportable segments (Details 1)
Reportable segments (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reportable segments | ||||
Loss from operations | $ (47,962,000) | $ (38,284,000) | ||
Impairment loss | (797,000) | (18,116,000) | ||
Income (loss) from investments, net | (789,000) | 3,330,000 | ||
Change in fair value of derivative liabilities | 33,921,000 | 0 | ||
Interest expense | 11,905,000 | 4,619,000 | ||
Other income (expense), net | (2,482,000) | 1,063,000 | ||
Foreign exchange adjustments | (60,000) | (334,000) | ||
Total other income (expenses) | 17,888,000 | (18,676,000) | ||
Loss from operations before income taxes | (30,074,000) | (56,960,000) | ||
Income tax (expense) benefit | 275,000 | 5,292,000 | ||
Net income (loss) | $ (11,941,000) | $ 14,406,000 | $ (30,349,000) | $ (51,668,000) |
Reportable segments (Details 2)
Reportable segments (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Depreciation And Amortization | ||
Depreciation And Amortization | $ 6,377 | $ 529 |
Infrastructure [Member] | ||
Depreciation And Amortization | ||
Depreciation And Amortization | 6,207 | 331 |
Telecommunications [Member] | ||
Depreciation And Amortization | ||
Depreciation And Amortization | $ 170 | $ 198 |
Reportable segments (Details 3)
Reportable segments (Details 3) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Total Capital Expenditures | $ 239 | $ 1,355 |
Infrastructure [Member] | ||
Total Capital Expenditures | 239 | 1,355 |
Telecommunications [Member] | ||
Total Capital Expenditures | $ 0 | $ 0 |
Reportable segments (Details 4)
Reportable segments (Details 4) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Total Investments | $ 6,993 | $ 9,719 |
Non-operating corporate | ||
Total Investments | 5,604 | 7,439 |
Infrastructure [Member] | ||
Total Investments | 1,389 | 2,280 |
Telecommunications [Member] | ||
Total Investments | $ 0 | $ 0 |
Reportable segments (Details 5)
Reportable segments (Details 5) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Total Assets | $ 168,454 | $ 143,610 |
Total Assets | (168,454) | (143,610) |
Non-operating corporate | ||
Total Assets | 96,507 | 79,579 |
Total Assets | (96,507) | (79,579) |
Infrastructure [Member] | ||
Total Assets | 97,292 | 56,701 |
Total Assets | (97,292) | (56,701) |
Telecommunications [Member] | ||
Total Assets | 57,234 | 73,659 |
Total Assets | (57,234) | (73,659) |
Eliminations [Member] | ||
Total Assets | 82,579 | 66,329 |
Total Assets | $ (82,579) | $ (66,329) |
Equity (Details)
Equity (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
RSUs outstanding, Beginning balance | shares | 44,920 |
RSUs granted | shares | 8,010 |
RSUs forfeited | shares | (2,720) |
RSUs outstanding, Ending balance | shares | 49,576 |
Weighted Average Grant Date Fair Value | |
Weighted average grant date fair value, Beginning balance | $ 1.78 |
Weighted average grant date fair value, RSUs granted | 3.84 |
Weighted average grant date fair value, RSUs forfeited | 3.08 |
Weighted average grant date fair value, Ending balance | $ 2.06 |
Restricted Stock Units [Member] | |
RSUs outstanding, Beginning balance | shares | 241 |
RSUs granted | shares | 405 |
RSUs released | shares | (241) |
RSUs outstanding, Ending balance | shares | 405 |
Weighted average remaining recognition period in years | 3 years 6 months |
Unamortized stock-based compensation expense | $ | $ 778 |
Weighted Average Grant Date Fair Value | |
Weighted average grant date fair value, Beginning balance | $ 3.41 |
Weighted average grant date fair value, RSUs granted | 2.26 |
Weighted average grant date fair value, RSUs released | 3.41 |
Weighted average grant date fair value, RSUs forfeited | 0 |
Weighted average grant date fair value, Ending balance | $ 2.26 |
Equity (Details 1)
Equity (Details 1) | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Shares | |
RSUs outstanding, Beginning balance | shares | 44,920,000 |
Options Granted | shares | 8,010,000 |
Options Exercised | shares | (634,000) |
RSUs forfeited | shares | (2,720,000) |
RSUs outstanding, Ending balance | shares | 49,576,000 |
Options Exercisable | shares | 24,626,000 |
Vested And Expected Vest, Shares | shares | 49,576 |
Weighted Average Exercise Price | |
Weighted average grant date fair value, Beginning balance | $ / shares | $ 1.78 |
Options Granted | $ / shares | 3.84 |
Options Exercised | $ / shares | (0.57) |
Options Cancelled | $ / shares | (3.08) |
Weighted average grant date fair value, Ending balance | $ / shares | 2.06 |
Options Exercisable | $ / shares | 1.44 |
Vested And Expected Vest, Weighted Average Exercise Price | $ / shares | $ 2.06 |
Intrinsic Value | |
Intrinsic Value, Options outstanding, Ending balance | $ | $ 14,364,000 |
Intrinsic Value, Options Exercisable, Ending balance | $ | 10,713,000 |
Vested And Expected Vest, Intrinsic Value | $ | $ 14,364 |
Weighted Average Remaining Contractual Term | |
Weighted Average Remaining Contractual Term, Options outstanding | 4 years 6 months 7 days |
Weighted Average Remaining Contractual Term, Options exercisable | 4 years 5 months 26 days |
Weighted Average Remaining Contractual Term, Vested And Expected To Vest | 4 years 6 months 7 days |
Equity (Details 2)
Equity (Details 2) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stockholders' Equity | ||
Weighted risk-free interest rate | 2.50% | 0.40% |
Weighted-average volatility | 257% | 412% |
Weighted expected dividend yield | 0% | 0% |
Weighted expected term (in years) | 4 years 2 months 12 days | 3 years 4 months 24 days |
Equity (Details 3)
Equity (Details 3) - Warrants [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Warrants issued, Beginning Balance | 24,085,000 | 19,845,000 |
Issued | 2,000,000 | 4,240,000 |
Exercised | (8,183,000) | 0 |
Expired | 0 | 0 |
Warrants Outstanding, Ending Balance | 17,902,000 | 24,085,000 |
Warrant exercisable | 17,902,000 | 24,085,000 |
Weighted Average Exercise Price, Beginning Balance | $ 1.74 | $ 1.26 |
Weighted Average Exercise Price, Issued | 8.50 | 4 |
Weighted Average Exercise Price, Exercised | 1.59 | 0 |
Weighted Average Exercise Price, Expired | 0 | 0 |
Weighted Average Exercise Price, Ending balance | 2.56 | 1.74 |
Weighted Average Exercise Price, Exercisable | $ 2.56 | $ 1.74 |
Weighted Average Remaining Contractual Life, Beginning balance | 3 years | 3 years 6 months |
Weighted Average Remaining Contractual Life, Issued | 2 years 9 months 18 days | 2 years 1 month 6 days |
Weighted Average Remaining Contractual Life, Ending balance | 1 year 9 months 18 days | 3 years |
Weighted Average Remaining Contractual Life, Exercisable | 1 year 9 months 18 days | 3 years |
Equity (Details 4)
Equity (Details 4) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stockholders' Equity | ||
Stock-based compensation | $ 35,449 | $ 30,623 |
Income tax benefit (1) | 276 | 2,408 |
After-tax stock-based compensation expense | $ 35,173 | $ 28,215 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||
Feb. 25, 2022 | Dec. 08, 2020 | Nov. 01, 2020 | Jun. 20, 2022 | Dec. 17, 2021 | Oct. 27, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Apr. 20, 2022 | May 21, 2021 | Apr. 30, 2020 | |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 | |||||||||
Common stock (1,285,714 shares) | $ 20 | $ 18 | |||||||||
Non-qualified stock options, granted | 8,010,000 | ||||||||||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 | |||||||||
Outstanding warrants to purchase Common Stock | 11,800,000 | ||||||||||
Derivative liability | $ 40,400 | ||||||||||
Deemed dividend amount | $ 32,800 | ||||||||||
Common Stock, Issued | 206,844,580 | 184,266,934 | |||||||||
Non-qualified stock options [Member] | |||||||||||
Non-qualified stock options, granted | 10,500,000 | ||||||||||
Exercise price | $ 0.55 | ||||||||||
Vest period | 3 years | ||||||||||
Non-qualified stock options, contractual term | 10 years | ||||||||||
Stock options, valuation | $ 0.51 | ||||||||||
Stock Options [Member] | |||||||||||
Weighted-average grant date fair value of all options granted | $ 2,370 | $ 2,820 | |||||||||
Total intrinsic value of stock options exercised | 1,100 | ||||||||||
Unrecognized stock-based compensation cost | $ 25,200 | ||||||||||
Weighted-average period | 1 year 10 months 24 days | ||||||||||
2020 Omnibus Equity Incentive Plan [Member] | |||||||||||
Remaining shares available for issuance | 34,600,000 | ||||||||||
Shares available for issuance | 75,000,000 | ||||||||||
Private Placement [Member] | |||||||||||
Purchase of stock | $ 2,500 | ||||||||||
Stock price per share | $ 0.25 | ||||||||||
Sale of stock | 8,700,000 | ||||||||||
Common stock (1,285,714 shares) | $ 2,200 | ||||||||||
Series D Preferred stock [Member] | |||||||||||
Preferred Stock, Shares Outstanding | 1,177,023 | ||||||||||
Preferred Stock Issued | 1,177,023 | 1,000,000 | |||||||||
Conversion Price Per Shares | $ 0.4248 | ||||||||||
Preferred Stock, Conversion Basis | The Series D liquidation preference is equal to $10.6191 per share | ||||||||||
Dividend fixed annual rate | 2.25% | ||||||||||
Liquidation Preference share | $ 0.23893 | ||||||||||
Common Stocks [Member] | |||||||||||
Common Stock, Issued | 1,428,575 | ||||||||||
Number of shares of common stock | 2,000,000 | ||||||||||
Common Stock, Per share | $ 8.50 | ||||||||||
Aggregate Purchase price of Common share | $ 10,000 | ||||||||||
Series A Preferred Stock [Member] | |||||||||||
Preferred Stock, Shares Outstanding | 0 | 0 | |||||||||
Preferred Stock Issued | 0 | 0 | |||||||||
Series B Convertible Preferred Stock | |||||||||||
Converted common stock shares | 2,155,594 | ||||||||||
Converson of stock, share issued common stock | 2,155,594 | ||||||||||
Series B Convertible Preferred Stock | ANS | |||||||||||
Preferred Stock, Shares Outstanding | 0 | 2,395,105 | |||||||||
Preferred Stock Issued | 0 | 2,395,105 | 2,395,105 | ||||||||
Aggregate purchase price | $ 6,900 | ||||||||||
Preferred Stock Series C [Member] | |||||||||||
Conversion Price Per Shares | $ 3.125 | ||||||||||
Cumulative dividends, per annum | 6% | ||||||||||
Preferred Stock Series C [Member] | Island Capital Group LLC [Member] | |||||||||||
Preferred Stock, Shares Outstanding | 6,226,370 | 2,370,370 | |||||||||
Preferred Stock Issued | 3,856,000 | 6,226,370 | 2,370,370 | ||||||||
Aggregate Face Value | $ 12,100 | $ 7,400 | |||||||||
Aggregate purchase price | $ 10,800 | $ 6,700 | |||||||||
Series D Convertible Preferred Stock | Arena Investors LP [Member] | |||||||||||
Preferred Stock Issued | 1,177,023 | ||||||||||
Convertible Notes | $ 12,500 | ||||||||||
Unamortized discount | $ 4,300 | ||||||||||
Series A Convertible Preferred Stock | |||||||||||
Preferred Stock, Conversion Basis | 1 preferred share is convertible to 1 common share | ||||||||||
Converted common stock shares | 1,000,000 | ||||||||||
Cumulative dividends, per annum | 4% | ||||||||||
Converson of stock, share issued common stock | 30,754,896 |
Commitments contingencies and_2
Commitments contingencies and concentration risk (Details Narrative) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Three Customer [Member] | Account Receivable [Member] | ||
Concentration Of Credit Risk | 10% | |
Aggregate Accounted Credit Risk Percentage | 46% | |
Two Customer [Member] | Account Receivable [Member] | ||
Concentration Of Credit Risk | 10% | |
Aggregate Accounted Credit Risk Percentage | 25% | |
Two Customer [Member] | Revenues [Member] | ||
Concentration Of Credit Risk | 10% | |
Aggregate Accounted Credit Risk Percentage | 36% | |
Revenue [Member] | Three Customer [Member] | ||
Concentration Of Credit Risk | 10% | |
Aggregate Accounted Credit Risk Percentage | 41% |
Income taxes (Details)
Income taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | ||
Federal | $ 0 | $ 0 |
State and local | 965,000 | 37,000 |
Total current | 965,000 | 37,000 |
Deferred: | ||
Federal | (334,000) | (5,403,000) |
State and local | (356,000) | 74,000 |
Total deferred | (690,000) | (5,329,000) |
Total income tax expense (benefit) | $ (4,287,000) | $ (5,292,000) |
Income taxes (Details 1)
Income taxes (Details 1) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income taxes | ||
U.S. statutory federal income tax rate | 21% | 21% |
Change in valuation allowance | (36.90%) | (1.30%) |
Convertible Debt | (4.10%) | 0% |
Derivative Expense | 23.70% | 0% |
Incentive Stock Options | (1.20%) | (3.80%) |
Deferred Consideration | (1.90%) | 0% |
Goodwill impairment | 0% | (6.20%) |
Vesting & Exercises | 1% | 0% |
162m Limitation | (2.20%) | 0% |
Other | (0.30%) | (0.20%) |
Income tax expense (benefit) for the period | (0.90%) | 9.50% |
Income taxes (Details 2)
Income taxes (Details 2) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets | ||
Net operating loss carryforwards | $ 3,990,000 | $ 4,916,000 |
Capital Loss Carryforward | 64,000 | 0 |
Stock-based compensation expense | 11,282,000 | 4,677,000 |
Allowance for bad debt | 81,000 | 62,000 |
163 Limitation | 1,567,000 | 255,000 |
Fixed Assets | 618,000 | 406,000 |
Unrealized gains / (loss) | 441,000 | 197,000 |
Foreign exchange gains (losses) | 12 | 0 |
Others | 132,000 | 6,000 |
Total gross deferred tax assets | 18,187,000 | 10,519,000 |
Less valuation allowances | (13,278,000) | (4,920,000) |
Net deferred tax asset | 4,909,000 | 5,599,000 |
Deferred tax liabilities | ||
Goodwill | (3,000) | 0 |
Intangible Asset | (6,295,000) | 0 |
Foreign exchange gains / losses | 0 | (19,000) |
Total gross deferred tax liabilities | (6,298,000) | (19,000) |
Net deferred tax asset (liabilities) | $ 1,389,000 | $ 5,580,000 |
Income taxes (Details 3)
Income taxes (Details 3) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Balance at Beginning of Year | $ 4,920 | |
Balance at End of Year | 13,278 | $ 4,920 |
Valuation Allowance [Member] | ||
Balance at Beginning of Year | 4,920 | 3,769 |
Increase (Decrease) Charged (Credited) to Income Taxes (Benefit) | 8,358 | 1,151 |
Balance at End of Year | $ 13,278 | $ 4,920 |
Income taxes (Details Narrative
Income taxes (Details Narrative) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Net operating loss carry-forwards | $ 12,600,000 | |
Valuation allowance | 13,300,000 | $ 4,900,000 |
After 2017 | ||
Net operating loss carry-forwards | $ 200,000 |