Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 13, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2021 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-38331 | |
Entity Registrant Name | DOLPHIN ENTERTAINMENT, INC. | |
Entity Central Index Key | 0001282224 | |
Entity Tax Identification Number | 86-0787790 | |
Entity Incorporation, State or Country Code | FL | |
Entity Address, Address Line One | 150 Alhambra Circle | |
Entity Address, Address Line Two | Suite 1200 | |
Entity Address, City or Town | Coral Gables | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33134 | |
City Area Code | (305) | |
Local Phone Number | 774-0407 | |
Title of 12(b) Security | Common Stock, $0.015 par value per share | |
Trading Symbol | DLPN | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 7,640,404 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 9,252,228 | $ 7,923,280 |
Restricted cash | 677,354 | 714,096 |
Accounts receivable, net of allowance of $563,782 and $653,272, respectively | 5,423,507 | 5,027,101 |
Other current assets | 424,158 | 231,890 |
Total current assets | 15,777,247 | 13,896,367 |
Capitalized production costs, net | 346,968 | 271,139 |
Right-of-use asset | 7,091,493 | 7,106,279 |
Goodwill | 20,015,800 | 19,627,856 |
Intangible assets, net of accumulated amortization of $6,537,937 and $5,747,941, respectively. | 6,932,063 | 7,452,059 |
Property, equipment and leasehold improvements, net | 602,297 | 800,071 |
Deposits and other assets | 228,313 | 198,180 |
Total Assets | 50,994,181 | 49,351,951 |
Current liabilities: | ||
Accounts payable | 859,912 | 1,190,184 |
Term loan | 700,227 | 900,292 |
Notes payable, current portion | 302,455 | 846,749 |
Convertible notes payable at fair value, current portion | 580,000 | |
Paycheck Protection Program loan, current portion | 848,987 | 582,438 |
Loan from related party | 1,107,873 | |
Accrued interest – related party | 1,718,227 | 1,783,121 |
Accrued compensation – related party | 2,625,000 | 2,625,000 |
Put rights | 1,544,029 | |
Lease liability | 1,847,117 | 1,791,773 |
Contract liabilities | 3,175,917 | 1,855,209 |
Other current liabilities | 2,442,421 | 2,045,844 |
Total current liabilities | 14,520,263 | 16,852,512 |
Notes payable | 924,141 | 426,645 |
Convertible notes payable | 3,050,000 | 1,445,000 |
Convertible notes payable at fair value | 1,029,766 | 947,291 |
Paycheck Protection Program loan | 1,188,582 | 2,517,431 |
Contingent consideration | 730,000 | 530,000 |
Loan from related party | 1,107,873 | |
Lease liability | 5,920,896 | 5,964,275 |
Warrant liability | 150,000 | 450,000 |
Other noncurrent liabilities | 200,000 | 550,000 |
Total noncurrent liabilities | 14,301,258 | 12,830,642 |
Total Liabilities | 28,821,521 | 29,683,154 |
STOCKHOLDERS' EQUITY | ||
Common stock, $0.015 par value, 40,000,000 shares authorized, 7,638,469 and 6,618,785, respectively, issued and outstanding at June 30, 2021 and December 31, 2020 | 114,575 | 99,281 |
Preferred stock, Series C, $0.001 par value, 50,000 shares authorized, issued and outstanding at June 30, 2021 and December 31, 2020 | 1,000 | 1,000 |
Additional paid in capital | 123,951,169 | 117,540,557 |
Accumulated deficit | (101,894,084) | (97,972,041) |
Total Stockholders' Equity | 22,172,660 | 19,668,797 |
Total Liabilities and Stockholders' Equity | $ 50,994,181 | $ 49,351,951 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Allowance for doubtful debts | $ 563,782 | $ 653,272 |
Intangible assets, accumulated amortization | $ 6,537,937 | $ 5,747,941 |
Common stock, par value | $ 0.015 | $ 0.015 |
Common stock, authorized | 40,000,000 | 40,000,000 |
Common stock, issued | 7,638,469 | 6,618,785 |
Common stock, Outstanding | 7,638,469 | 6,618,785 |
Preferred stock, authorized shares | 10,000,000 | |
Series C Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, authorized shares | 50,000 | 50,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues: | ||||
Entertainment publicity and marketing | $ 8,643,244 | $ 5,194,725 | $ 15,820,361 | $ 11,828,525 |
Content production | ||||
Total revenues | 8,643,244 | 5,194,725 | 15,820,361 | 11,828,525 |
Operating expenses: | ||||
Direct costs | 833,511 | 656,849 | 1,583,931 | 1,285,361 |
Payroll and benefits | 5,622,468 | 2,879,073 | 10,892,831 | 7,779,939 |
Selling, general and administrative | 1,194,704 | 978,527 | 2,718,658 | 2,223,345 |
Depreciation and amortization | 478,270 | 496,461 | 960,982 | 1,017,464 |
Legal and professional | 457,998 | 362,853 | 802,606 | 572,314 |
Total expenses | 8,586,951 | 5,373,763 | 16,959,008 | 12,878,423 |
Income (loss) from operations | 56,293 | (179,038) | (1,138,647) | (1,049,898) |
Other income (expenses): | ||||
Gain on extinguishment of debt, net | 1,012,973 | 955,610 | 3,259,866 | |
Loss on disposal of fixed assets | (48,461) | (48,461) | ||
Loss on the deconsolidation of Max Steel VIE | (1,484,591) | |||
Change in fair value of convertible notes and derivative liabilities | 268,974 | (696,420) | (602,475) | (548,961) |
Change in fair value of warrants | 65,000 | (483,519) | (2,497,877) | (411,004) |
Change in fair value of put rights | 47,070 | (71,106) | 1,517,810 | |
Change in fair value of contingent consideration | 165,000 | (573,000) | (200,000) | (470,000) |
Acquisition costs | (22,907) | |||
Interest expense and debt amortization | (169,837) | (1,058,694) | (335,031) | (1,682,976) |
Total other income (expense), net | 1,293,649 | (2,764,563) | (2,822,247) | 180,144 |
Income (loss) before income taxes | 1,349,942 | (2,943,601) | (3,960,894) | (869,754) |
Income tax benefit | 38,851 | |||
Net income (loss) | $ 1,349,942 | $ (2,943,601) | $ (3,922,043) | $ (869,754) |
Earnings (loss) per share: | ||||
Basic | $ 0.17 | $ (0.62) | $ (0.53) | $ (0.20) |
Diluted | $ 0.13 | $ (0.62) | $ (0.53) | $ (0.46) |
Weighted average number of shares outstanding: | ||||
Basic | 7,664,000 | 4,719,241 | 7,456,360 | 4,363,742 |
Diluted | 7,913,396 | 4,719,241 | 7,456,360 | 5,214,355 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (3,922,043) | $ (869,754) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 960,982 | 1,017,464 |
Loss on deconsolidation of Max Steel VIE | 1,484,591 | |
Beneficial conversion feature of convertible notes payable | 1,227,993 | |
Interest owed on convertible debt settled with shares of common stock upon conversion | 10,812 | |
Amortization of debt discount | 59,726 | |
Gain on extinguishment of debt | (955,610) | (3,259,866) |
Impairment of fixed assets | 48,461 | |
Impairment of capitalized production costs | 20,000 | |
Bad debt and recovery of account receivable written off, net | 84,673 | 192,471 |
Change in fair value of put rights | 71,106 | (1,517,810) |
Change in fair value of contingent consideration | 200,000 | 470,000 |
Change in fair value of warrants | 2,497,877 | 411,004 |
Change in fair value of notes payable and derivative instruments | 602,475 | 548,961 |
Change in deferred tax | (38,851) | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net of allowance | (326,917) | 866,799 |
Other current assets | (91,389) | (114,632) |
Capitalized production costs, net | (95,829) | (71,539) |
Deposits and other assets | (6,516) | (96,137) |
Contract liability | 1,263,714 | 60,586 |
Accounts payable | (434,996) | 134,009 |
Accrued interest – related party | (64,894) | |
Lease liability, net | 26,750 | 47,130 |
Other current liabilities | 191,067 | 114,258 |
Net cash provided by operating activities | 30,060 | 716,066 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of fixed assets | (7,723) | |
Acquisition of B/HI Communications, Inc, net of cash acquired | (525,856) | |
Acquisition of Shore Fire Media, Ltd, net of cash acquired | (624,836) | |
Acquisition of Viewpoint, net of cash acquired | (250,000) | |
Net cash used in investing activities | (525,856) | (882,559) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayment of the line of credit | (600,033) | |
Proceeds from convertible notes payable | 3,050,000 | 2,395,000 |
Repayment of convertible notes payable | (1,202,064) | |
Repayment of term loan | (200,065) | |
Repayment of notes payable | (46,798) | (42,803) |
Proceeds from PPP loans | 2,795,700 | |
Exercise of put rights | (1,015,135) | (459,700) |
Proceeds from sale of common stock through registered direct offering | 7,644,350 | |
Net cash provided by financing activities | 1,788,002 | 10,530,450 |
Net increase in cash and cash equivalents | 1,292,206 | 10,363,957 |
Cash and cash equivalents and restricted cash, beginning of period | 8,637,376 | 2,910,338 |
Cash and cash equivalents and restricted cash, end of period | 9,929,582 | 13,274,295 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION: | ||
Interest paid | 311,151 | 208,742 |
SUPPLEMENTAL DISCLOSURES OF NON CASH FLOW INFORMATION: | ||
Principal balance of convertible notes converted into shares of common stock | 2,545,000 | 2,650,000 |
Issuance of shares of common stock related to the acquisitions | 350,000 | |
Put rights exchanged for shares of common stock | 600,000 | |
Interest on notes paid in stock | 8,611 | |
Cash and cash equivalents | 9,252,228 | 12,560,206 |
Restricted cash | 677,354 | 714,089 |
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statement of cash flows | $ 9,929,582 | $ 13,274,295 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 1,000 | $ 53,679 | $ 106,680,619 | $ (97,158,766) | $ 9,576,532 |
Beginning Balance, Shares at Dec. 31, 2019 | 50,000 | 3,578,580 | |||
Net loss | 2,073,847 | 2,073,847 | |||
Deconsolidation of Max Steel VIE | 1,125,917 | 1,125,917 | |||
Issuance of shares related to acquisition of Viewpoint | $ 746 | (746) | |||
Issuance of shares related to acquisition of Viewpoint, Shares | 49,747 | ||||
Issuance of shares related to financing agreement | $ 150 | (150) | |||
Issuance of shares related to financing agreement, Shares | 10,000 | ||||
Beneficial conversion of convertible promissory note | 301,781 | 301,781 | |||
Issuance of shares related to conversion of notes payable | $ 5,633 | 1,169,788 | 1,175,421 | ||
Issuance of shares related to conversion of notes payable, Shares | 375,562 | ||||
Shares retired from exercise of puts | $ (98) | (1,637,102) | (1,637,200) | ||
Shares retired from exercise of puts, Shares | (6,507) | ||||
Ending balance, value at Mar. 31, 2020 | $ 1,000 | $ 60,110 | 106,514,190 | (93,959,002) | 12,616,298 |
Ending Balance, Shares at Mar. 31, 2020 | 50,000 | 4,007,382 | |||
Net loss | (2,943,601) | (2,943,601) | |||
Issuance of shares related to acquisition of Viewpoint | $ 10 | (10) | |||
Issuance of shares related to acquisition of Viewpoint, Shares | 685 | ||||
Beneficial conversion of convertible promissory note | 856,863 | 856,863 | |||
Issuance of earnout shares to sellers of 42West | 2,799 | (302,799) | (300,000) | ||
Issuance of shares related to conversion of notes payable | $ 7,109 | 1,288,951 | 1,296,060 | ||
Issuance of earnout shares to sellers of 42West, Shares | 186,573 | ||||
Issuance of shares related to direct registered sale of common stock | $ 23,700 | 7,620,650 | 7,644,350 | ||
Issuance of shares related to direct registered sale of common stock | 1,580,000 | ||||
Issuance of shares related to conversion of notes payable, Shares | 473,900 | ||||
Issuance of shares related to cashless exercise of warrants | $ 1,131 | 368,344 | 369,475 | ||
Issuance of shares related to cashless exercise of warrants, Shares | 75,403 | ||||
Shares retired from exercise of puts | $ (32) | 32 | |||
Shares retired from exercise of puts, Shares | (2,162) | ||||
Ending balance, value at Jun. 30, 2020 | $ 1,000 | $ 94,827 | 116,346,221 | (96,902,603) | 19,539,445 |
Ending Balance, Shares at Jun. 30, 2020 | 50,000 | 6,321,781 | |||
Beginning balance, value at Dec. 31, 2020 | $ 1,000 | $ 99,281 | 117,540,557 | (97,972,041) | 19,668,797 |
Beginning Balance, Shares at Dec. 31, 2020 | 50,000 | 6,618,785 | |||
Net loss | (5,271,985) | (5,271,985) | |||
Issuance of shares related to conversion of notes payable | $ 9,948 | 2,543,664 | 2,553,612 | ||
Issuance of shares related to conversion of notes payable, Shares | 663,155 | ||||
Issuance of shares related to cashless exercise of warrants | $ 2,190 | 2,795,687 | 2,797,877 | ||
Issuance of shares related to cashless exercise of warrants, Shares | 146,027 | ||||
Issuance of shares issued to seller of Be Social | $ 1,549 | 348,451 | 350,000 | ||
Issuance of shares issued to seller of Be Social, Shares | 103,245 | ||||
Consideration for acquisition of B/HI Communications, Inc | 31,158 | 31,158 | |||
Issuance of shares related to exchange of Put Rights for stock | $ 1,163 | 356,199 | 357,362 | ||
Issuance of shares related to exchange of Put Rights for stock, Shares | 77,519 | ||||
Shares retired from exercise of puts | $ (51) | 51 | |||
Shares retired from exercise of puts, Shares | (3,254) | ||||
Ending balance, value at Mar. 31, 2021 | $ 1,000 | $ 114,080 | 123,615,767 | (103,244,026) | 20,486,821 |
Ending Balance, Shares at Mar. 31, 2021 | 50,000 | 7,605,477 | |||
Net loss | 1,349,942 | 1,349,942 | |||
Issuance of shares related to exchange of Put Rights for stock | $ 568 | 348,759 | 349,327 | ||
Issuance of shares related to exchange of Put Rights for stock, Shares | 37,847 | ||||
Shares retired from exercise of puts | $ (227) | (13,203) | (13,430) | ||
Shares retired from exercise of puts, Shares | (15,093) | ||||
Issuance of shares related to acquisition of The Door | $ 154 | (154) | |||
Issuance of shares related to acquisition of The Door, Shares | 10,238 | ||||
Ending balance, value at Jun. 30, 2021 | $ 1,000 | $ 114,575 | $ 123,951,169 | $ (101,894,084) | $ 22,172,660 |
Ending Balance, Shares at Jun. 30, 2021 | 50,000 | 7,638,469 |
GENERAL
GENERAL | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1 – GENERAL Dolphin Entertainment, Inc., a Florida corporation (the “Company,” “Dolphin,” “we,” “us” or “our”), is a leading independent entertainment marketing and premium content development company. Through its acquisitions of 42West LLC (“42West”), The Door Marketing Group, LLC (“The Door”), Shore Fire Media, Ltd (“Shore Fire”), Viewpoint Computer Animation Incorporated (“Viewpoint”), Be Social Public Relations, LLC (“Be Social”) and B/HI Communications, Inc. (“B/HI”), the Company provides expert strategic marketing and publicity services to all of the major film studios and many of the leading independent and digital content providers, A-list celebrity talent, including actors, directors, producers, celebrity chefs, social media influencers and recording artists. The Company also provides strategic marketing publicity services and creative brand strategies for prime hotel and restaurant groups and consumer brands. The strategic acquisitions of 42West, The Door, Shore Fire, Viewpoint, Be Social and B/HI bring together premium marketing services, including digital and social media marketing capabilities, with premium content production, creating significant opportunities to serve respective constituents more strategically and to grow and diversify the Company’s business. Dolphin’s content production business is a long established, leading independent producer, committed to distributing premium, best-in-class film and digital entertainment. Dolphin produces original feature films and digital programming primarily aimed at family and young adult markets. Impact of COVID-19 On March 11, 2020, the World Health Organization categorized a novel coronavirus (“COVID-19”) as a pandemic, and it has spread throughout the United States. The pandemic has had and continues to have a significant effect on economic conditions in the United States, and continues to cause significant uncertainties in the U.S. and global economies, particularly as a result of a new Delta variant of COVID-19, which appears to be causing an increase in COVID-19 cases. Public health officials and medical professionals have warned that a resurgence of COVID-19 cases may continue, particularly if vaccination rates do not quickly increase or if additional, potent variants emerge. It is unclear how long a resurgence may last, how severe it may be, and what safety measures governments may impose in response to it. The extent to which the COVID-19 pandemic affects our business, operations and financial results depends, and will continue to depend, on numerous evolving factors that we may not be able to accurately predict. Since the outbreak of COVID-19 began and public and private sector measures to reduce its transmission were implemented, such as the imposition of social distancing and orders to work-from-home, stay-at-home and shelter-in-place, the demand for certain of the services the Company offers was adversely affected resulting in decreased revenues and cash flows. One of our subsidiaries operates in the food and hospitality sector, which was negatively impacted by the orders to either suspend or reduce operations of restaurants and hotels. Similarly, another subsidiary represents talent, such as actors, directors and producers, and revenues from these clients was negatively impacted by the suspension of content production. The television and streaming consumption around the globe has increased since the outbreak of COVID-19, as well as the demand for consumer products. Revenues from the marketing of these shows and products somewhat offset the decrease in revenue from the sectors discussed above. Between April 19, 2020 and April 23, 2020, the Company and its subsidiaries received five separate unsecured loans for an aggregate amount of $ 2.8 304,169 100,000 40 1.1 0.8 Depending on the extent and duration of the pandemic and the related economic impacts, COVID-19 may continue to impact our business and financial results, as well as significant judgments and estimates, including those related to goodwill and other asset impairments and allowances for doubtful accounts. Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Dolphin, and all of its wholly owned subsidiaries, comprising Dolphin Films, Inc. (“Dolphin Films”), Dolphin SB Productions LLC, Dolphin Max Steel Holdings, LLC (“Max Steel Holdings”), Dolphin JB Believe Financing, LLC, Dolphin JOAT Productions, LLC, 42West, The Door, Viewpoint, Shore Fire, Be Social and B/HI. The Company enters into relationships or investments with other entities, and in certain instances, the entity in which the Company has a relationship or investment may qualify as a variable interest entity (“VIE”). A VIE is consolidated in the financial statements if the Company is deemed to be the primary beneficiary of the VIE. The primary beneficiary is the party that has the power to direct activities that most significantly impact the activities of the VIE and has the obligation to absorb losses or the right to benefits from the VIE that could potentially be significant to the VIE. The Company has included JB Believe, LLC formed on December 4, 2012 in the State of Florida in its condensed consolidated financial statements for the three and six months ended June 30, 2021 and 2020 as a VIE. On November 23, 2020, the Company filed an amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Florida to effect a 1-for-5 reverse stock split (the “Reverse Stock Split”) of the authorized, issued and outstanding shares of the Common Stock. The Reverse Stock Split was effective as of 12:01 a.m. (Eastern Time) on November 27, 2020 (the “Effective Time”). At the Effective Time, the number of authorized shares of Common Stock was reduced from 200,000,000 shares to 40,000,000. The par value per share of Common Stock remains unchanged. As a result, each shareholder’s percentage ownership interest in the Company and proportional voting power remained unchanged. Any fractional shares resulting from the Reverse Stock Split were rounded up to the nearest whole share of Common Stock. All references to Common Stock or common stock price in these condensed consolidated financial statements have been retroactively adjusted to reflect the Reverse Stock Split. The unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2021, and it results of operations for the three and six months ended June 30, 2021 and 2020, and cash flows for the six months ended June 30, 2021 and 2020. All significant inter-company balances and transactions have been eliminated from the condensed consolidated financial statements. Operating results for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2021. The condensed consolidated balance sheet at December 31, 2020 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read together with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Reclassifications Reclassifications have been made to our unaudited condensed consolidated financial statements for the prior period to conform to classifications used in 2021. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. The most significant estimates made by management in the preparation of the financial statements relate to estimates of sales returns and other allowances, provisions for doubtful accounts and impairment assessments for goodwill and intangible assets. Actual results could differ materially from such estimates. Additionally, the full impact of the COVID-19 outbreak is unknown and cannot be reasonably estimated. However, management has made appropriate accounting estimates on certain accounting matters, which include the allowance for doubtful accounts, carrying value of the goodwill and other intangible assets, carrying amount of certain convertible notes payable and embedded derivatives and warrant liabilities, based on the facts and circumstances available as of the reporting date. The Company’s future assessment of the magnitude and duration of the COVID-19 outbreak, as well as other factors, could result in material impacts to the Company’s financial statements in future reporting periods. Update to Significant Accounting Policies The Company’s significant accounting policies are detailed in "Note 3: Summary of Significant Accounting Policies" within Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020. Significant changes to our accounting policies as a result of adopting ASU 2020-06 during the six months ended June 30, 2021 is discussed below. There were no significant changes to our accounting policies during the three months ended June 30, 2021. Convertible Notes On January 1, 2021, the Company adopted Accounting Standards Update (“ASU”) 2020-06 that simplifies the accounting for convertible instruments. ASU 2020-06 (i) reduced the number of accounting models for convertible instruments, by eliminating the models that require separation of cash conversion or beneficial conversion features from the host and (ii) revised derivative scope exception and (iii) provided targeted improvements for EPS. The adoption of ASU 2020-06 did not have a material impact on the Company’s outstanding convertible debt instruments as of June 30, 2021. Recent Accounting Pronouncements Accounting Guidance Adopted In August 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 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 December 2019, the FASB issued ASU 2019-12, “ Income taxes (Topic 740): Simplifying the Accounting for Income Taxes. ” Accounting Guidance Not Yet Adopted In June 2016, the FASB issued new guidance on measurement of credit losses (ASU 2016-13, Measurement of Credit Losses on Financial Instruments) with subsequent amendments issued in November 2018 (ASU 2018-19) and April 2019 (ASU 2019-04). This update changes the accounting for credit losses on loans and held-to-maturity debt securities and requires a current expected credit loss (CECL) approach to determine the allowance for credit losses. It is applicable to trade accounts receivable. The guidance is effective for fiscal years beginning after December 15, 2022 with a cumulative-effect adjustment to retained earnings as of the beginning of the year of adoption. Early adoption is permitted. The Company is in the process of evaluating the impact of the adoption of ASU 2016-13 on the Company's consolidated financial statements and disclosures. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | NOTE 2 — GOING CONCERN The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. GAAP and contemplate the continuation of the Company as a going concern. The Company has suffered recurring losses, including a net loss of $ 3,922,043 101,894,084 Since the beginning of the pandemic, the Company implemented certain measures to mitigate the effects of the pandemic on the Company, such as a freezes on hiring, salary reductions, staff reductions and cuts in non-essential spending. In addition, the Company has taken other measures to strengthen its financial position, which is evidenced by a positive working capital as of June 30, 2021. The Company is dependent upon funds from the issuance of debt securities, securities convertible into shares of its common stock, par value $ 0.015 These factors raise substantial doubt about the ability of the Company to continue as a going concern within one year after these condensed consolidated financial statements are issued. The condensed consolidated financial statements, of which these notes form a part, do not include any adjustments that might result from the outcome of these uncertainties. The Company’s management currently plans to raise any necessary additional funds through additional issuances of its Common Stock, securities convertible into its Common Stock and/or debt securities, as well as available bank and non-bank financing, or a combination of such financing alternatives. There is no assurance that the Company will be successful in raising additional capital. Any issuance of shares of Common Stock or securities convertible into Common Stock would dilute the equity interests of our existing shareholders, perhaps substantially. The Company currently has the rights to several scripts, including one currently in development for which it intends to obtain financing to produce and release following which it expects to earn a producer and overhead fee. There can be no assurances that such production, together with any other productions, will be commenced or released or that fees will be realized in future periods or at all. The Company is currently exploring opportunities to expand the services currently being offered by 42West, The Door, Viewpoint, Shore Fire, Be Social and B/HI while reducing expenses of their respective operations through synergies with the Company. There can be no assurance that the Company will be successful in expanding such services or reducing expenses. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | NOTE 3 — GOODWILL AND INTANGIBLE ASSETS As of June 30, 2021, in connection with its acquisitions of 42West, The Door, Viewpoint, Shore Fire, Be Social and B/HI, the Company has a balance of $ 20,015,800 The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its’ carrying amount, including goodwill. If management concludes that it is more likely than not that the fair value of the reporting unit is less than its’ carrying amount, management conducts a quantitative goodwill impairment test. This impairment test involves comparing the fair value of the reporting unit with its’ carrying value (including goodwill). The Company estimates the fair values of its reporting units using a combination of the income, or discounted cash flows approach and the market approach, which utilizes comparable companies’ data. If the estimated fair value of the reporting unit is less than its carrying value, a goodwill impairment exists for the reporting unit and an impairment loss is recorded. Goodwill All of the Company’s goodwill is related to the entertainment, publicity and marketing segment. Changes in the carrying value of goodwill were as follows: Schedule of Changes In Carrying Value of Goodwill Balance as of December 31, 2020 $ 19,627,856 Measurement period adjustments (1) (82,651 ) Business Acquisitions (2) 470,595 Balance as of June 30, 2021 $ 20,015,800 ——————— (1) Working Capital adjustment recorded in (June 2021) in connection with the Be Social acquisition. (See Note 4) (2) Acquisition of B/HI in January 2021. Intangible Assets Intangible assets consisted of the following as of June 30, 2021 and December 31, 2020: Schedule of Intangible Assets June 30, 2021 December 31, 2020 Gross Accumulated Net Gross Accumulated Net Intangible assets subject to amortization: Customer relationships $ 8,290,000 $ 4,327,902 $ 3,962,098 $ 8,130,000 $ 3,787,406 $ 4,342,593 Trademarks and trade names 4,490,000 1,570,035 2,919,965 4,440,000 1,330,535 3,109,465 Non-compete agreements 690,000 640,000 50,000 630,000 630,000 — $ 13,470,000 $ 6,537,937 $ 6,932,063 $ 13,200,000 $ 5,747,941 $ 7,452,059 Amortization expense associated with the Company’s intangible assets was $ 394,998 400,078 789,996 830,990 Amortization expense related to intangible assets for the next five years is as follows: Schedule of amortization expense related to intangible assets for the next five years 2021 (July 1 through December 31, 2021) $ 789,995 2022 1,367,330 2023 1,152,421 2024 991,715 2025 961,373 Thereafter 1,669,229 Total $ 6,932,063 |
MERGERS AND ACQUISITIONS
MERGERS AND ACQUISITIONS | 6 Months Ended |
Jun. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
MERGERS AND ACQUISITIONS | NOTE 4 — MERGERS AND ACQUISITIONS B/HI Communications, Inc. On January 8, 2021, but effective January 1, 2021, the Company acquired all of the issued and outstanding shares of B/HI, a California corporation, (the “B/HI Purchase”) pursuant to a share purchase agreement (the “B/HI Share Purchase Agreement”) between the Company and Dean G. Bender and Janice L. Bender, as co-trustees of the Bender Family Trust dated May 6, 2013 (collectively, the “B/HI Sellers). B/HI is an entertainment public relations agency that specializes in corporate and product communications programs for interactive gaming, esports, entertainment content and consumer product organizations. The total consideration paid to the B/HI Seller in respect to the B/HI Purchase is $ 0.8 1.2 The following table summarizes the provisional fair value of the consideration transferred: Summary of provisional fair value of consideration transferred Payments made to settle final indebtedness, net of minimum operating cash as defined in the B/HI Share Purchase Agreement $ 575,856 Provisional working capital adjustment 192,986 Provisional amount of Common Stock to be issued to the B/HI Sellers 31,158 Provisional fair value of the consideration transferred $ 800,000 As a condition to the B/HI Purchase, Dean Bender, one of the sellers and Shawna Lynch, a key employee of B/HI entered into employment agreements with the Company to continue as employees after the closing of the B/HI Purchase. Mr. Bender’s agreement is for a period of two years through December 31, 2022 and he will serve as Co-President of B/HI during that term. Ms. Lynch’s agreement is for a period of four years and may be renewed on the same terms for two successive two-year terms. Ms. Lynch will serve as Co-President of B/HI during the term of her agreement. The following table summarizes the provisional fair values of the assets acquired and liabilities assumed by the B/HI Purchase. Amounts in the table are estimates that may change, as described below. Schedule of Assets Acquired and Liabilities Assumed Cash $ 65,465 Accounts receivable 154,162 Other current assets 15,262 Property, equipment and leasehold improvements 24,639 Right-of-use asset 1,044,864 Other assets 23,617 Intangibles 270,000 Total identifiable assets acquired 1,598,009 Accrued payable (104,724 ) Accrued expenses and other current liabilities (259,936 ) Lease liability (1,044,864 ) Deferred revenue (56,994 ) Line of credit (456,527 ) Deferred tax liability (38,851 ) Loans payable (75,550 ) Total liabilities assumed (2,037,446 ) Net identifiable liabilities acquired (439,437 ) Goodwill 470,595 Net assets acquired $ 31,158 Unaudited Pro Forma Consolidated Statements of Operations For the three and six months ended June 30, 2021, the Company’s statements of operations includes revenue pertaining to B/HI amounting to $ 818,408 1,426,841 138,161 157,069 Schedule of Proforma Results of Operations Three Months ended Six Months ended June 30, June 30, Revenues $ 6,161,800 $ 13,943,911 Net loss $ (3,196,376 ) $ (1,427,558 ) These amounts have been calculated after applying the Company’s accounting policies and adjusting the results of the acquisitions to reflect the amortization that would have been charged, assuming the intangible assets had been recorded on January 1, 2020. The impact of the acquisition of Be Social and B/HI on the Company’s actual results for periods following the acquisition may differ significantly from that reflected in this unaudited pro forma information for a number of reasons. As a result, this unaudited pro forma information is not necessarily indicative of what the combined company’s financial condition or results of operations would have been had the acquisitions been completed on January 1, 2020, as provided in this pro forma financial information. In addition, the pro forma financial information does not purport to project the future financial condition and results of operations of the combined company. Be Social In August 2020, the Company acquired all of the issued and outstanding membership interest of Be Social. During the three and six months ended June 30, 2021, the Company recorded a measurement period adjustment amounting to $ 82,651 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 5 — DEBT Total debt of the Company was as follows as of June 30, 2021 and December 31, 2020: Schedule of debt Debt Type June 30, December 31, Convertible notes payable $ 3,050,000 $ 1,445,000 Convertible notes payable - fair value option 1,029,766 1,527,293 Notes payable 1,226,596 1,273,394 Term loan 700,227 900,292 Paycheck Protection Program loans 2,037,569 3,099,869 Total debt $ 8,044,158 $ 8,245,848 Less current portion of debt (1,851,669 ) (2,909,479 ) Noncurrent portion of debt $ 6,192,489 $ 5,336,369 The table below details the maturity dates for the Company’s debt as of June 30, 2021: Schedule of Future Annual Contractual Principal Payment Commitments of Debt Debt Type Maturity Date 2021 2022 2023 2024 2025 Thereafter Convertible notes payable Ranging between March 2023 and March 2030 $ — $ — $ 3,050,000 $ — $ — $ 500,000 Nonconvertible promissory notes Ranging between June 2021 and December 2023 49,953 307,685 868,960 — — — Term loan Bank United March 31, 2023 200,065 400,130 100,032 — — — Paycheck Protection Program loans Ranging between April 2022 and May 5, 2022 339,595 1,018,784 679,190 — — — $ 589,613 $ 1,726,599 $ 4,698,182 $ — $ — $ 500,000 Convertible Notes Payable 3,050,000 10 2.50 During the six months ended June 30, 2021, the holders of five convertible notes issued during 2020 converted the principal balance of $ 1,445,000 8,611 381,601 3.69 3.96 The Company recorded interest expense related to these convertible notes payable of $ 15,565 42,482 31,149 As of June 30, 2021 and December 31, 2020, the principal balance of the convertible promissory notes of $ 3,050,000 1,445,000 The following is a summary of the Company’s convertible notes payable as of June 30, 2021: Schedule of convertible notes payable Fair Value Principal Amount Net Carrying Amount Level 10% convertible notes due in March 2023 $ 150,000 $ 150,000 $ 153,000 3 10% convertible notes due in April 2023 1,050,000 1,050,000 1,120,000 3 10% convertible notes due in June 2023 1,850,000 1,850,000 1,840,000 3 $ 3,050,000 $ 3,050,000 $ 3,113,000 Convertible Notes Payable at Fair Value 1,600,000 On each of January 13, 2021 and January 27, 2021, notes with a remaining aggregate principal balance of $1,100,000 were converted into 281,554 shares of Common Stock at purchase prices ranging between $3.90 and $3.91 per share. The Company had a balance of $1,029,766 and 947,293 in noncurrent liabilities as of June 30, 2021 and December 31, 2020, respectively, and $580,000 in current liabilities as of December 31, 2020 recorded on its condensed consolidated balance sheets related to the convertible promissory notes measured at fair value. The Company recorded a gain in fair value of $268,974 and a loss in fair value of $696,420 for the three months ended June 30, 2021 and 2020, respectively, and losses in fair value of $602,475 and $548,961 for the six months ended June 30, 2021 and 2020, respectively, on its condensed consolidated statements of operations. The Company recorded interest expense of $ 9,863 19,726 19,726 Nonconvertible Promissory Notes 1.4 10 As of June 30, 2021 and December 31, 2020, the Company had a balance of $ 302,455 846,749 924,141 426,645 30,927 33,347 62,449 67,230 62,726 67,230 Term Loan 700,227 The Term Loan contains both customary affirmative and negative covenants. The bank tests for compliance with debt covenants on an annual basis based on the financial statements of 42West and The Door as of and for the year ended December 31. Based on current economic factors and uncertainties due to COVID-19, the Company believes it is out of compliance with certain debt covenants as of and for the three and six months ended June 30, 2021. As such, the Company classified the entire balance of the Term Loan in current liabilities on its condensed consolidated balance sheet as of June 30, 2021. Paycheck Protection Program Loan In April 2020, the Company and its subsidiaries received an aggregate amount of $ 2.8 304,169 1.1 0.8 As of June 30, 2021, the current and noncurrent portion of the loan were $ 848,987 1,188,582 |
LOANS FROM RELATED PARTY
LOANS FROM RELATED PARTY | 6 Months Ended |
Jun. 30, 2021 | |
Loans From Related Party | |
LOANS FROM RELATED PARTY | NOTE 6 — LOANS FROM RELATED PARTY Dolphin Entertainment, LLC (“DE LLC”), an entity wholly owned by the Company’s Chief Executive Officer, William O’Dowd (the “CEO”), previously advanced funds for working capital to Dolphin Films. In prior years, Dolphin Films entered into a promissory note with DE LLC (the “Original DE LLC Note”) in the principal amount of $ 1,009,624 For the three and six months ended June 30, 2021, the Company did not repay any principal balance of the New DE LLC Note. The Company recorded interest expense related to the New DE LLC Note amounting to $ 27,621 54,938 55,242 As of both June 30, 2021 and December 31, 2020, the Company had a principal balance of $ 1,107,873 26,683 81,621 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 7 — FAIR VALUE MEASUREMENTS Put Rights 22,867 1,015,135 600,000 115,366 The following is a reconciliation of the fair value of the Put Rights from December 31, 2020 to June 30, 2021: Schedule of Fair Value Assumptions Used to Value Liabilities Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 1,544,029 Put rights paid in 2021 (1,015,135 ) Loss in fair value reported in condensed consolidated the statements of operations 71,106 Put rights converted into common stock (600,000 ) Ending fair value of put rights reported in the condensed consolidated balance sheet at June 30, 2021 $ – Contingent consideration The Company records the fair value of the contingent consideration liability in the condensed consolidated balance sheets under the caption “Contingent Consideration” and records changes to the liability against earnings or loss under the caption “Changes in fair value of contingent consideration” in the condensed consolidated statements of operations. The Company utilized a Monte Carlo Simulation model, which incorporates significant inputs that are not observable in the market, and thus represents a Level 3 measurement as defined in ASC 820. The unobservable inputs utilized for measuring the fair value of the contingent consideration reflect management’s own assumptions about the assumptions that market participants would use in valuing the contingent consideration as of the acquisition date. The Company determined the fair value by using the following key inputs to the Monte Carlo Simulation Model: Schedule of Liability Fair Value Categorized Within Level 3 The Door Be Social Inputs As of June 30, 2021 As of As of As of Risk Free Discount Rate (based on US government treasury obligation with a term similar to that of the contingent consideration) 0.06 % 0.16 % 0.16 0.36 % 0.13 0.17 % Annual Asset Volatility Estimate 82.5 % 60.0 % 87.5 % 73.5 % For the contingent consideration, which are measured at fair value categorized within Level 3 of the fair value hierarchy, the following is a reconciliation of the fair values from December 31, 2020 to June 30, 2021: Schedule of fair value categorized within Level 3 The Door Be Social Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 370,000 $ 160,000 Loss in fair value reported in the condensed consolidated statements of operations 180,000 20,000 Ending fair value balance reported in the condensed consolidated balance sheet at June 30, 2021 $ 550,000 $ 180,000 Contingent Consideration – B/HI In connection with the Company’s acquisition of B/HI, the seller of B/HI has the potential to earn up to $ 1,200,000 Fair Value Option (“FVO”) Election – Convertible notes payable and freestanding warrants 2020 convertible notes payable During 2020, the Company issued three convertible notes payable: a convertible note with a principal amount of $ 1.3 rd 500,000 th 560,000 th The 2020 convertible notes are measured at fair value categorized within Level 3 of the fair value hierarchy. The following is a reconciliation of the fair values from December 31, 2020 to June 30, 2021: Schedule of Fair Value Assumptions Used to Value Liabilities January 3 rd March 4th Note March 25th Note Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 436,155 $ 511,136 $ 580,000 (Gain) loss in fair value reported in the condensed consolidated statements of operations 103,845 518,630 (20,000) Exercised during the six months ended June 30, 2021 (540,000 ) — (560,000 ) Ending fair value balance reported on the condensed consolidated balance sheet at June 30, 2021 $ — $ 1,029,766 $ — The estimated fair value of the January 3 rd th The estimated fair value of the March 4th Note as of June 30, 2021 and as of December 31, 2020, was computed using a Black-Scholes simulation of the present value of its cash flows using a synthetic credit rating analysis and a required rate of return, using the following assumptions: Schedule of estimated fair value Fair Value Assumptions - March 4 th June 30, December 31, Face value principal payable $ 500,000 $ 500,000 Original conversion price $ 3.91 $ 3.91 Value of Common Stock $ 9.34 $ 3.40 Expected term (years) 8.68 9.18 Volatility 100 % 100 % Risk free rate 1.34 % 0.93 % Warrants During the six months ended June 30, 2021, the Series E, F, G, and H Warrants were all exercised and the Company issued 146,027 The warrants are measured at fair value and categorized within Level 3 of the fair value hierarchy. The following is a reconciliation of the fair values from December 31, 2020 to June 30, 2021: Schedule of warrants are measured at fair value Fair Value: Series E, F, G and H Series I Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 400,000 $ 50,000 Loss in fair value reported in the condensed consolidated statements of operations 2,397,877 100,000 Exercise of warrants during the six months ended June 30, 2021 (2,797,877 ) — Ending fair value balance reported on the condensed consolidated balance sheet at June 30, 2021 $ — $ 150,000 The estimated fair value of the Series “I” Warrants was computed using a Black-Scholes valuation model, using the following assumptions: Fair Value Assumption - Series “I” Warrants June 30, December 31, Aggregate Fair Value $ 150,000 $ 50,000 Exercise Price per share $ 3.91 $ 3.91 Value of Common Stock $ 9.34 $ 3.40 Expected term (years) 4.17 4.67 Volatility 100 % 100 % Dividend yield 0 % 0 % Risk free rate 0.70 % 0.31 % Term Loan and PPP Loans The estimated fair value of the Term Loan and PPP Loans approximates their carrying amount based on the arrangement of the financing of the debt and pursuant to the terms of the CARES ACT, respectively. The Company applied for the PPP Loans to be forgiven by the SBA. (See Note 5) |
CONTRACT LIABILITIES
CONTRACT LIABILITIES | 6 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
CONTRACT LIABILITIES | NOTE 8 — CONTRACT LIABILITIES The Company receives advance payments from customers for public relations projects or as deposits for promotional or brand-support video projects, that it records as contract liabilities. Once the work is performed or the projects are delivered to the customer, the contract liabilities are deemed earned and recorded as revenue. Advance payments received are generally for short duration and are recognized once the performance obligation of the contract is met. As of June 30, 2021 and December 31, 2020, the Company had balances of $ 3,175,917 1,855,209 |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | NOTE 9 — VARIABLE INTEREST ENTITIES VIEs are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses or the right to receive the residual returns of the entity. The Company evaluated the entities in which it did not have a majority voting interest and determined that it had (1) the power to direct the activities of the entities that most significantly impact their economic performance and (2) had the obligation to absorb losses or the right to receive benefits from these entities. As such the financial statements of JB Believe, LLC are consolidated in the condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020, and in the condensed consolidated statements of operations and statements of cash flows presented herein for the three and six months ended June 30, 2021 and 2020. This entity was previously under common control and has been accounted for at historical costs for all periods presented. Summary of Financial Information for Variable Interest Entities JB Believe LLC (in USD) For the three months ended For the three months ended For the six months ended For the six months ended June 30, 2020 As of June 30, 2021 As of December 31, 2020 Assets $ n/a $ n/a $ n/a $ n/a $ 251,671 $ 190,347 Liabilities $ n/a $ n/a $ n/a $ n/a $ (6,750,088 ) $ (6,749,914 ) Revenues $ — $ — $ — — n/a n/a Expenses $ — $ — $ — — n/a n/a The Company performs ongoing reassessments of (1) whether entities previously evaluated under the majority voting-interest framework have become VIEs, based on certain triggering events, and therefore would be subject to the VIE consolidation framework, and (2) whether changes in the facts and circumstances regarding the Company’s involvement with a VIE cause the Company’s consolidation conclusion to change. The consolidation status of the VIEs with which the Company is involved may change as a result of such reassessments. Changes in consolidation status are applied prospectively with assets and liabilities of a newly consolidated VIE initially recorded at fair value unless the VIE is an entity which was previously under common control, which in that case is consolidated based on historical cost. A gain or loss may be recognized upon deconsolidation of a VIE depending on the amounts of deconsolidated assets and liabilities compared to the fair value of retained interests and ongoing contractual arrangements. JB Believe LLC (“Believe”), an entity owned by Believe Film Partners LLC, of which the Company owns a 25% membership interest, was formed for the purpose of recording the production costs of the motion picture “ Believe Believe 3,200,000 5,000,000 Believe 6,301,314 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 10 — STOCKHOLDERS’ EQUITY A. Preferred Stock The Company’s Amended and Restated Articles of Incorporation authorize the issuance of 10,000,000 On July 6, 2017, the Company amended its Articles of Incorporation to designate 50,000 0.001 4,738,940 DE LLC, as the holder of the Series C is entitled to 14,216,819 votes, which are equal to approximately 65% of the voting securities of the Company. At the meeting of the Board on November 12, 2020, the Board and Mr. O’Dowd agreed to restrict the conversion of the Series C until the Board approved its conversion. Therefore, on November 16, 2020, the Company and DE, LLC entered into a Stock Restriction Agreement pursuant to which the conversion of the Series C is prohibited until such time as a majority of the independent directors of the Board approves the removal of the prohibition. The Stock Restriction Agreement also prohibits the sale or other transfer of the Series C until such transfer is approved by a majority of the independent directors of the Board. The Stock Restriction Agreement shall terminate upon a Change of Control (as such term is defined in the Stock Restriction Agreement) of the Company. The Certificate of Designation also provides for a liquidation value of $ 0.001 B. Common Stock The following table summarizes the movement of the common stock outstanding for the six months ended June 30, 2020: Schedule of common stock outstanding Common Stock Outstanding Shares Balance at December 31, 2020 6,618,785 Issuance of shares: Conversion of note payable 663,155 Cashless exercise of warrants 146,027 Issued to seller of Be Social 103,245 Exchange of Put Rights for stock 115,366 Issued to seller of The Door 10,238 Shares retired from exercise of puts (18,347 ) Balance at June 30, 2021 7,638,469 C. Incentive Compensation Plan On June 29, 2017, the shareholders of the Company approved the Dolphin Digital Media, Inc. 2017 Equity Incentive Plan (the “2017 Plan”). During the three and six months ended June 30, 2021 and 2020, the Company did not issue any Awards under the 2017 Plan. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | NOTE 11 — EARNINGS (LOSS) PER SHARE The following table sets forth the computation of basic and diluted earnings (loss) per share: Schedule of Basic and Diluted Income (Loss) Per Share Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 Numerator Net income (loss) $ 1,349,942 $ (2,943,601 ) $ (3,922,043 ) $ (869,754 ) Net income attributable to participating securities 8,750 — — — Net income (loss) attributable to Dolphin Entertainment common stock shareholders and numerator for basic earnings (loss) per share 1,341,192 (2,943,601 ) (3,922,043 ) (869,754 ) Change in fair value of put rights — — — (1,517,810 ) Change in fair value of derivative liability (268,974 ) — — — Change in fair value of warrants (65,000 ) — — — Interest expense 36,862 — — — Numerator for diluted earnings (loss) per share $ 1,044,080 $ (2,943,601 ) $ (3,922,043 ) $ (2,387,564 ) Denominator Denominator for basic EPS - weighted-average shares 7,664,000 4,719,241 7,456,360 4,363,742 Effect of dilutive securities: Put rights — — — 850,613 Warrants 11,913 — — — Convertible notes payable 237,483 — — — Denominator for diluted EPS - adjusted weighted-average shares 7,913,396 4,719,241 7,456,360 5,214,355 Basic earnings (loss) per share $ 0.17 $ (0.62 ) $ (0.53 ) $ (0.20 ) Diluted earnings (loss) per share $ 0.13 $ (0.62 ) $ (0.53 ) $ (0.46 ) Basic earnings (loss) per share is computed by dividing income (loss) attributable to the shareholders of Common Stock (the numerator) by the weighted-average number of shares of Common Stock outstanding (the denominator) for the period. Diluted earnings (loss) per share assumes that any dilutive equity instruments, such as put rights, warrants and convertible notes payable were exercised and outstanding Common Stock adjusted accordingly. Certain of the Company’s convertible notes payable and the Series C Preferred Stock have clauses that entitle the holder to participate if dividends are declared to the common stockholders as if the instruments had been converted into shares of Common Stock. As such, the Company uses the two-class method to compute earnings per share and attribute a portion of the Company’s net income to these participating securities. For the three months ended June 30, 2021, the Company attributed $ 8,750 In periods when the Put Rights are assumed to have been settled at the beginning of the period in calculating the denominator for diluted earnings (loss) per share, the related change in the fair value of Put Right liability recognized in the condensed consolidated statements of operations for the period, is added back or subtracted from net income (loss) during the period. The denominator for calculating diluted earnings (loss) per share for the three and six months ended June 30, 2021 and 2020 assumes the Put Rights had been settled at the beginning of the period, and therefore, the related income (loss) due to the decrease in the fair value of the Put Right liability during the three and six months ended June 30, 2021 and 2020 is subtracted from net income (loss). The number of shares added to the denominator for the Put Rights is calculated using the reverse treasury stock method that assumes the Company issues and sells sufficient shares at the average period trading price to satisfy the Put Right contracts. For the three months ended June 30, 2021, convertible promissory notes and warrants were included in the calculation of fully diluted earnings per share using the if-converted method that assumes the convertible promissory notes are converted at the beginning of the reporting period using the average market price for the three months ended June 30, 2021 of the Common Stock. For the six months ended June 30, 2021 and the three and six months ended June 30, 2020, the convertible promissory notes and warrants in the aggregate amount of 304,613 2,061,635 3,177,253 |
WARRANTS
WARRANTS | 6 Months Ended |
Jun. 30, 2021 | |
Warrants | |
WARRANTS | NOTE 12 — WARRANTS A summary of warrants outstanding at December 31, 2020 and issued, exercised and expired during the six months ended June 30, 2021 is as follows: Summary of Warrants Issued Warrants: Shares Weighted Avg. Balance at December 31, 2020 221,513 $ 7.08 Issued — — Exercised (166,072 ) 0.00 Expired (35,441 ) 23.70 Balance at June 30, 2021 20,000 $ 3.91 On March 4, 2020, in connection with the March 4th Note, the Company issued Series “I” Warrant to purchase up to 20,000 3.91 40,000 65,000 100,000 150,000 50,000 The Company recorded a loss of $ 2,397,877 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 13 — RELATED PARTY TRANSACTIONS On September 7, 2012, the Company entered into an employment agreement with its CEO, which provides for annual compensation of $250,000 and an annual discretionary bonus as determined by the Board. Unpaid compensation accrues interest at a rate of 10% per annum. In 2019, the Compensation Committee approved an increase in Mr. O’Dowd’s annual salary to $300,000. On May 17, 2021, the Compensation Committee of the Board approved an increase in the base salary of Mr. O’Dowd from $300,000 to $400,000 per year. The increase was effective January 1, 2021. As of June 30, 2021 and December 31, 2020, the Company had accrued $ 2,625,000 1,718,227 1,756,438 65,445 65,445 130,171 130,890 168,379 The Company entered into the New DE LLC Note with an entity wholly owned by our CEO. See Note 6 for further discussion. In connection with the acquisition of 42West, the Company and its CEO, as personal guarantor, entered into the Put Agreements with each of the sellers of 42West, pursuant to which the Company granted the Put Rights. During the three and six months ended June 30, 2021, the Company made payments in the amount of $ 300,000 400,000 6,507 46.10 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 14 — SEGMENT INFORMATION The Company operates in two reportable segments, Entertainment Publicity and Marketing Segment (“EPD”) and Content Production Segment (“CPD”). The Entertainment Publicity and Marketing segment is composed of 42West, The Door, Viewpoint, Shore Fire, Be Social, and B/HI, and provides clients with diversified services, including public relations, entertainment and hospitality content marketing and strategic marketing consulting. The Content Production segment is composed of Dolphin Entertainment and Dolphin Films and engages in the production and distribution of digital content and feature films. The profitability measure employed by our chief operating decision maker for allocating resources to operating segments and assessing operating segment performance is operating income (loss) which is the same as Loss before other income (expenses) on the Company’s condensed consolidated statements of operations for the three and six months ended June 30, 2021. Salaries and related expenses include salaries, bonuses, commissions and other incentive related expenses. Legal and professional expenses primarily include professional fees related to financial statement audits, legal, investor relations and other consulting services, which are engaged and managed by each of the segments. In addition, general and administrative expenses include rental expense and depreciation of property, equipment and leasehold improvements for properties occupied by corporate office employees. In connection with the acquisitions of 42West, The Door, Viewpoint, Shore Fire, Be Social, and B/HI, the Company assigned $ 6,932,063 6,537,937 20,015,800 Schedule of Revenue and Assets by Segment Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 Revenues: EPD $ 8,643,244 $ 5,194,725 $ 15,820,361 $ 11,828,525 CPD — — — — Total $ 8,643,244 $ 5,194,725 $ 15,820,361 $ 11,828,525 Segment Operating Income (Loss): EPD $ 1,391,171 $ 875,831 $ 602,295 $ 216,757 CPD (1,334,878 ) (1,054,869 ) (1,740,942 ) (1,266,655 ) Total operating income (loss) 56,293 (179,038 ) (1,138,647 ) (1,049,898 ) Interest expense (169,837 ) (1,058,694 ) (335,031 ) (1,682,976 ) Other income, net 1,463,486 (1,705,869 ) (2,487,216 ) 1,863,120 Income (Loss) before income taxes $ 1,349,942 $ (2,943,601 ) $ (3,960,894 ) $ (869,754 ) As of As of Total assets: EPD $ 47,699,370 $ 45,266,315 CPD 3,294,811 4,085,636 Total $ 50,994,181 $ 49,351,951 |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2021 | |
Leases | |
LEASES | NOTE 15 — LEASES The Company and its subsidiaries are party to various office leases with terms expiring at different dates through December 2026. The amortizable life of the right-of-use asset is limited by the expected lease term. Although certain leases include options to extend the Company did not include these in the right-of-use asset or lease liability calculations because it is not reasonably certain that the options will be executed. The table below shows the lease income and expenses recorded in the condensed consolidated statements of operations incurred during the three and six months ended June 30, 2021 and 2020. Schedule of Lease Income and Expenses Lease costs Classification Three months Three months Six months ended June 30, 2021 Six months ended June 30, 2020 Operating lease costs Selling, general and administrative expenses $ 664,315 $ 554,506 $ 1,410,843 $ 1,063,113 Operating lease costs Direct costs — 60,861 60,861 121,722 Sublease income Selling, general and administrative expenses — (2,397 ) — (4,794 ) Net lease costs $ 664,315 $ 612,970 $ 1,471,704 $ 1,180,041 Lease Payments For the three and six months ended June 30, 2021, the Company made payments in cash related to its operating leases in the amounts of $ 663,738 1,402,896 Future maturities lease payments for operating leases for the remainder of 2021 and thereafter, were as follows: Schedule of Future Minimum Payments Under Operating Lease Agreements 2021 $ 1,330,585 2022 2,073,640 2023 1,954,903 2024 1,824,908 2025 1,232,060 Thereafter 940,976 Total lease payments $ 9,357,072 Less: Imputed interest (1,589,059 ) Present value of lease liabilities $ 7,768,013 As of June 30, 2021, the Company’s weighted average remaining lease terms on its operating lease is 4.44 5.79 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 16 — COMMITMENTS AND CONTINGENCIES Litigation The Company may be subject to legal proceedings, claims, and liabilities that arise in the ordinary course of business. In the opinion of management and based upon the advice of its outside counsels, the liability, if any, from any pending litigation is not expected to have a material effect in the Company’s financial position, results of operations and cash flows. The Company is not aware of any pending litigation as of the date of this report. Letter of Credit Pursuant to the lease agreements of 42West’s New York and Los Angeles office locations, the Company is required to issue letters of credit to secure the leases. On July 24, 2018, the Company renewed the letter of credit issued by City National Bank for the 42West office space in New York. The letter of credit is for $677,354 and originally expired on August 1, 2018. This letter of credit renews automatically annually unless City National Bank notifies the landlord 60-days prior to the expiration of the bank’s election not to renew the letter of credit. The Company granted City National Bank a security interest in bank account funds totaling $677,354 pledged as collateral for the letter of credit. The letters of credit commit the issuer to pay specified amounts to the holder of the letter of credit under certain conditions. If this were to occur, the Company would be required to reimburse the issuer of the letter of credit. The Company is not aware of any other claims relating to its outstanding letters of credit as of June 30, 2021. |
GENERAL (Policies)
GENERAL (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Impact of COVID-19 | Impact of COVID-19 On March 11, 2020, the World Health Organization categorized a novel coronavirus (“COVID-19”) as a pandemic, and it has spread throughout the United States. The pandemic has had and continues to have a significant effect on economic conditions in the United States, and continues to cause significant uncertainties in the U.S. and global economies, particularly as a result of a new Delta variant of COVID-19, which appears to be causing an increase in COVID-19 cases. Public health officials and medical professionals have warned that a resurgence of COVID-19 cases may continue, particularly if vaccination rates do not quickly increase or if additional, potent variants emerge. It is unclear how long a resurgence may last, how severe it may be, and what safety measures governments may impose in response to it. The extent to which the COVID-19 pandemic affects our business, operations and financial results depends, and will continue to depend, on numerous evolving factors that we may not be able to accurately predict. Since the outbreak of COVID-19 began and public and private sector measures to reduce its transmission were implemented, such as the imposition of social distancing and orders to work-from-home, stay-at-home and shelter-in-place, the demand for certain of the services the Company offers was adversely affected resulting in decreased revenues and cash flows. One of our subsidiaries operates in the food and hospitality sector, which was negatively impacted by the orders to either suspend or reduce operations of restaurants and hotels. Similarly, another subsidiary represents talent, such as actors, directors and producers, and revenues from these clients was negatively impacted by the suspension of content production. The television and streaming consumption around the globe has increased since the outbreak of COVID-19, as well as the demand for consumer products. Revenues from the marketing of these shows and products somewhat offset the decrease in revenue from the sectors discussed above. Between April 19, 2020 and April 23, 2020, the Company and its subsidiaries received five separate unsecured loans for an aggregate amount of $ 2.8 304,169 100,000 40 1.1 0.8 Depending on the extent and duration of the pandemic and the related economic impacts, COVID-19 may continue to impact our business and financial results, as well as significant judgments and estimates, including those related to goodwill and other asset impairments and allowances for doubtful accounts. |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Dolphin, and all of its wholly owned subsidiaries, comprising Dolphin Films, Inc. (“Dolphin Films”), Dolphin SB Productions LLC, Dolphin Max Steel Holdings, LLC (“Max Steel Holdings”), Dolphin JB Believe Financing, LLC, Dolphin JOAT Productions, LLC, 42West, The Door, Viewpoint, Shore Fire, Be Social and B/HI. The Company enters into relationships or investments with other entities, and in certain instances, the entity in which the Company has a relationship or investment may qualify as a variable interest entity (“VIE”). A VIE is consolidated in the financial statements if the Company is deemed to be the primary beneficiary of the VIE. The primary beneficiary is the party that has the power to direct activities that most significantly impact the activities of the VIE and has the obligation to absorb losses or the right to benefits from the VIE that could potentially be significant to the VIE. The Company has included JB Believe, LLC formed on December 4, 2012 in the State of Florida in its condensed consolidated financial statements for the three and six months ended June 30, 2021 and 2020 as a VIE. On November 23, 2020, the Company filed an amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Florida to effect a 1-for-5 reverse stock split (the “Reverse Stock Split”) of the authorized, issued and outstanding shares of the Common Stock. The Reverse Stock Split was effective as of 12:01 a.m. (Eastern Time) on November 27, 2020 (the “Effective Time”). At the Effective Time, the number of authorized shares of Common Stock was reduced from 200,000,000 shares to 40,000,000. The par value per share of Common Stock remains unchanged. As a result, each shareholder’s percentage ownership interest in the Company and proportional voting power remained unchanged. Any fractional shares resulting from the Reverse Stock Split were rounded up to the nearest whole share of Common Stock. All references to Common Stock or common stock price in these condensed consolidated financial statements have been retroactively adjusted to reflect the Reverse Stock Split. The unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2021, and it results of operations for the three and six months ended June 30, 2021 and 2020, and cash flows for the six months ended June 30, 2021 and 2020. All significant inter-company balances and transactions have been eliminated from the condensed consolidated financial statements. Operating results for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2021. The condensed consolidated balance sheet at December 31, 2020 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read together with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. |
Reclassifications | Reclassifications Reclassifications have been made to our unaudited condensed consolidated financial statements for the prior period to conform to classifications used in 2021. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. The most significant estimates made by management in the preparation of the financial statements relate to estimates of sales returns and other allowances, provisions for doubtful accounts and impairment assessments for goodwill and intangible assets. Actual results could differ materially from such estimates. Additionally, the full impact of the COVID-19 outbreak is unknown and cannot be reasonably estimated. However, management has made appropriate accounting estimates on certain accounting matters, which include the allowance for doubtful accounts, carrying value of the goodwill and other intangible assets, carrying amount of certain convertible notes payable and embedded derivatives and warrant liabilities, based on the facts and circumstances available as of the reporting date. The Company’s future assessment of the magnitude and duration of the COVID-19 outbreak, as well as other factors, could result in material impacts to the Company’s financial statements in future reporting periods. |
Update to Significant Accounting Policies | Update to Significant Accounting Policies The Company’s significant accounting policies are detailed in "Note 3: Summary of Significant Accounting Policies" within Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020. Significant changes to our accounting policies as a result of adopting ASU 2020-06 during the six months ended June 30, 2021 is discussed below. There were no significant changes to our accounting policies during the three months ended June 30, 2021. Convertible Notes On January 1, 2021, the Company adopted Accounting Standards Update (“ASU”) 2020-06 that simplifies the accounting for convertible instruments. ASU 2020-06 (i) reduced the number of accounting models for convertible instruments, by eliminating the models that require separation of cash conversion or beneficial conversion features from the host and (ii) revised derivative scope exception and (iii) provided targeted improvements for EPS. The adoption of ASU 2020-06 did not have a material impact on the Company’s outstanding convertible debt instruments as of June 30, 2021. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Guidance Adopted In August 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 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 December 2019, the FASB issued ASU 2019-12, “ Income taxes (Topic 740): Simplifying the Accounting for Income Taxes. ” Accounting Guidance Not Yet Adopted In June 2016, the FASB issued new guidance on measurement of credit losses (ASU 2016-13, Measurement of Credit Losses on Financial Instruments) with subsequent amendments issued in November 2018 (ASU 2018-19) and April 2019 (ASU 2019-04). This update changes the accounting for credit losses on loans and held-to-maturity debt securities and requires a current expected credit loss (CECL) approach to determine the allowance for credit losses. It is applicable to trade accounts receivable. The guidance is effective for fiscal years beginning after December 15, 2022 with a cumulative-effect adjustment to retained earnings as of the beginning of the year of adoption. Early adoption is permitted. The Company is in the process of evaluating the impact of the adoption of ASU 2016-13 on the Company's consolidated financial statements and disclosures. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes In Carrying Value of Goodwill | Schedule of Changes In Carrying Value of Goodwill Balance as of December 31, 2020 $ 19,627,856 Measurement period adjustments (1) (82,651 ) Business Acquisitions (2) 470,595 Balance as of June 30, 2021 $ 20,015,800 ——————— (1) Working Capital adjustment recorded in (June 2021) in connection with the Be Social acquisition. (See Note 4) (2) Acquisition of B/HI in January 2021. |
Schedule of Intangible Assets | Schedule of Intangible Assets June 30, 2021 December 31, 2020 Gross Accumulated Net Gross Accumulated Net Intangible assets subject to amortization: Customer relationships $ 8,290,000 $ 4,327,902 $ 3,962,098 $ 8,130,000 $ 3,787,406 $ 4,342,593 Trademarks and trade names 4,490,000 1,570,035 2,919,965 4,440,000 1,330,535 3,109,465 Non-compete agreements 690,000 640,000 50,000 630,000 630,000 — $ 13,470,000 $ 6,537,937 $ 6,932,063 $ 13,200,000 $ 5,747,941 $ 7,452,059 |
Schedule of amortization expense related to intangible assets for the next five years | Schedule of amortization expense related to intangible assets for the next five years 2021 (July 1 through December 31, 2021) $ 789,995 2022 1,367,330 2023 1,152,421 2024 991,715 2025 961,373 Thereafter 1,669,229 Total $ 6,932,063 |
MERGERS AND ACQUISITIONS (Table
MERGERS AND ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of provisional fair value of consideration transferred | Summary of provisional fair value of consideration transferred Payments made to settle final indebtedness, net of minimum operating cash as defined in the B/HI Share Purchase Agreement $ 575,856 Provisional working capital adjustment 192,986 Provisional amount of Common Stock to be issued to the B/HI Sellers 31,158 Provisional fair value of the consideration transferred $ 800,000 |
Schedule of Assets Acquired and Liabilities Assumed | Schedule of Assets Acquired and Liabilities Assumed Cash $ 65,465 Accounts receivable 154,162 Other current assets 15,262 Property, equipment and leasehold improvements 24,639 Right-of-use asset 1,044,864 Other assets 23,617 Intangibles 270,000 Total identifiable assets acquired 1,598,009 Accrued payable (104,724 ) Accrued expenses and other current liabilities (259,936 ) Lease liability (1,044,864 ) Deferred revenue (56,994 ) Line of credit (456,527 ) Deferred tax liability (38,851 ) Loans payable (75,550 ) Total liabilities assumed (2,037,446 ) Net identifiable liabilities acquired (439,437 ) Goodwill 470,595 Net assets acquired $ 31,158 |
Schedule of Proforma Results of Operations | Schedule of Proforma Results of Operations Three Months ended Six Months ended June 30, June 30, Revenues $ 6,161,800 $ 13,943,911 Net loss $ (3,196,376 ) $ (1,427,558 ) |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Schedule of debt Debt Type June 30, December 31, Convertible notes payable $ 3,050,000 $ 1,445,000 Convertible notes payable - fair value option 1,029,766 1,527,293 Notes payable 1,226,596 1,273,394 Term loan 700,227 900,292 Paycheck Protection Program loans 2,037,569 3,099,869 Total debt $ 8,044,158 $ 8,245,848 Less current portion of debt (1,851,669 ) (2,909,479 ) Noncurrent portion of debt $ 6,192,489 $ 5,336,369 |
Schedule of Future Annual Contractual Principal Payment Commitments of Debt | Schedule of Future Annual Contractual Principal Payment Commitments of Debt Debt Type Maturity Date 2021 2022 2023 2024 2025 Thereafter Convertible notes payable Ranging between March 2023 and March 2030 $ — $ — $ 3,050,000 $ — $ — $ 500,000 Nonconvertible promissory notes Ranging between June 2021 and December 2023 49,953 307,685 868,960 — — — Term loan Bank United March 31, 2023 200,065 400,130 100,032 — — — Paycheck Protection Program loans Ranging between April 2022 and May 5, 2022 339,595 1,018,784 679,190 — — — $ 589,613 $ 1,726,599 $ 4,698,182 $ — $ — $ 500,000 |
Schedule of convertible notes payable | Schedule of convertible notes payable Fair Value Principal Amount Net Carrying Amount Level 10% convertible notes due in March 2023 $ 150,000 $ 150,000 $ 153,000 3 10% convertible notes due in April 2023 1,050,000 1,050,000 1,120,000 3 10% convertible notes due in June 2023 1,850,000 1,850,000 1,840,000 3 $ 3,050,000 $ 3,050,000 $ 3,113,000 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of Fair Value Assumptions Used to Value Liabilities | Schedule of Fair Value Assumptions Used to Value Liabilities January 3 rd March 4th Note March 25th Note Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 436,155 $ 511,136 $ 580,000 (Gain) loss in fair value reported in the condensed consolidated statements of operations 103,845 518,630 (20,000) Exercised during the six months ended June 30, 2021 (540,000 ) — (560,000 ) Ending fair value balance reported on the condensed consolidated balance sheet at June 30, 2021 $ — $ 1,029,766 $ — |
Schedule of fair value categorized within Level 3 | Schedule of fair value categorized within Level 3 The Door Be Social Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 370,000 $ 160,000 Loss in fair value reported in the condensed consolidated statements of operations 180,000 20,000 Ending fair value balance reported in the condensed consolidated balance sheet at June 30, 2021 $ 550,000 $ 180,000 |
Schedule of estimated fair value | Schedule of estimated fair value Fair Value Assumptions - March 4 th June 30, December 31, Face value principal payable $ 500,000 $ 500,000 Original conversion price $ 3.91 $ 3.91 Value of Common Stock $ 9.34 $ 3.40 Expected term (years) 8.68 9.18 Volatility 100 % 100 % Risk free rate 1.34 % 0.93 % |
Convertible Debt Warrants I [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of warrants are measured at fair value | Schedule of warrants are measured at fair value Fair Value: Series E, F, G and H Series I Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 400,000 $ 50,000 Loss in fair value reported in the condensed consolidated statements of operations 2,397,877 100,000 Exercise of warrants during the six months ended June 30, 2021 (2,797,877 ) — Ending fair value balance reported on the condensed consolidated balance sheet at June 30, 2021 $ — $ 150,000 The estimated fair value of the Series “I” Warrants was computed using a Black-Scholes valuation model, using the following assumptions: Fair Value Assumption - Series “I” Warrants June 30, December 31, Aggregate Fair Value $ 150,000 $ 50,000 Exercise Price per share $ 3.91 $ 3.91 Value of Common Stock $ 9.34 $ 3.40 Expected term (years) 4.17 4.67 Volatility 100 % 100 % Dividend yield 0 % 0 % Risk free rate 0.70 % 0.31 % |
Put Option [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of Fair Value Assumptions Used to Value Liabilities | Schedule of Fair Value Assumptions Used to Value Liabilities Beginning fair value balance reported on the consolidated balance sheet at December 31, 2020 $ 1,544,029 Put rights paid in 2021 (1,015,135 ) Loss in fair value reported in condensed consolidated the statements of operations 71,106 Put rights converted into common stock (600,000 ) Ending fair value of put rights reported in the condensed consolidated balance sheet at June 30, 2021 $ – |
Contingent Consideration [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of warrants are measured at fair value | Schedule of Liability Fair Value Categorized Within Level 3 The Door Be Social Inputs As of June 30, 2021 As of As of As of Risk Free Discount Rate (based on US government treasury obligation with a term similar to that of the contingent consideration) 0.06 % 0.16 % 0.16 0.36 % 0.13 0.17 % Annual Asset Volatility Estimate 82.5 % 60.0 % 87.5 % 73.5 % |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Financial Information for Variable Interest Entities | Summary of Financial Information for Variable Interest Entities JB Believe LLC (in USD) For the three months ended For the three months ended For the six months ended For the six months ended June 30, 2020 As of June 30, 2021 As of December 31, 2020 Assets $ n/a $ n/a $ n/a $ n/a $ 251,671 $ 190,347 Liabilities $ n/a $ n/a $ n/a $ n/a $ (6,750,088 ) $ (6,749,914 ) Revenues $ — $ — $ — — n/a n/a Expenses $ — $ — $ — — n/a n/a |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Schedule of common stock outstanding | Schedule of common stock outstanding Common Stock Outstanding Shares Balance at December 31, 2020 6,618,785 Issuance of shares: Conversion of note payable 663,155 Cashless exercise of warrants 146,027 Issued to seller of Be Social 103,245 Exchange of Put Rights for stock 115,366 Issued to seller of The Door 10,238 Shares retired from exercise of puts (18,347 ) Balance at June 30, 2021 7,638,469 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Income (Loss) Per Share | Schedule of Basic and Diluted Income (Loss) Per Share Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 Numerator Net income (loss) $ 1,349,942 $ (2,943,601 ) $ (3,922,043 ) $ (869,754 ) Net income attributable to participating securities 8,750 — — — Net income (loss) attributable to Dolphin Entertainment common stock shareholders and numerator for basic earnings (loss) per share 1,341,192 (2,943,601 ) (3,922,043 ) (869,754 ) Change in fair value of put rights — — — (1,517,810 ) Change in fair value of derivative liability (268,974 ) — — — Change in fair value of warrants (65,000 ) — — — Interest expense 36,862 — — — Numerator for diluted earnings (loss) per share $ 1,044,080 $ (2,943,601 ) $ (3,922,043 ) $ (2,387,564 ) Denominator Denominator for basic EPS - weighted-average shares 7,664,000 4,719,241 7,456,360 4,363,742 Effect of dilutive securities: Put rights — — — 850,613 Warrants 11,913 — — — Convertible notes payable 237,483 — — — Denominator for diluted EPS - adjusted weighted-average shares 7,913,396 4,719,241 7,456,360 5,214,355 Basic earnings (loss) per share $ 0.17 $ (0.62 ) $ (0.53 ) $ (0.20 ) Diluted earnings (loss) per share $ 0.13 $ (0.62 ) $ (0.53 ) $ (0.46 ) |
WARRANTS (Tables)
WARRANTS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Warrants | |
Summary of Warrants Issued | Summary of Warrants Issued Warrants: Shares Weighted Avg. Balance at December 31, 2020 221,513 $ 7.08 Issued — — Exercised (166,072 ) 0.00 Expired (35,441 ) 23.70 Balance at June 30, 2021 20,000 $ 3.91 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Assets by Segment | Schedule of Revenue and Assets by Segment Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 Revenues: EPD $ 8,643,244 $ 5,194,725 $ 15,820,361 $ 11,828,525 CPD — — — — Total $ 8,643,244 $ 5,194,725 $ 15,820,361 $ 11,828,525 Segment Operating Income (Loss): EPD $ 1,391,171 $ 875,831 $ 602,295 $ 216,757 CPD (1,334,878 ) (1,054,869 ) (1,740,942 ) (1,266,655 ) Total operating income (loss) 56,293 (179,038 ) (1,138,647 ) (1,049,898 ) Interest expense (169,837 ) (1,058,694 ) (335,031 ) (1,682,976 ) Other income, net 1,463,486 (1,705,869 ) (2,487,216 ) 1,863,120 Income (Loss) before income taxes $ 1,349,942 $ (2,943,601 ) $ (3,960,894 ) $ (869,754 ) As of As of Total assets: EPD $ 47,699,370 $ 45,266,315 CPD 3,294,811 4,085,636 Total $ 50,994,181 $ 49,351,951 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Leases | |
Schedule of Lease Income and Expenses | Schedule of Lease Income and Expenses Lease costs Classification Three months Three months Six months ended June 30, 2021 Six months ended June 30, 2020 Operating lease costs Selling, general and administrative expenses $ 664,315 $ 554,506 $ 1,410,843 $ 1,063,113 Operating lease costs Direct costs — 60,861 60,861 121,722 Sublease income Selling, general and administrative expenses — (2,397 ) — (4,794 ) Net lease costs $ 664,315 $ 612,970 $ 1,471,704 $ 1,180,041 |
Schedule of Future Minimum Payments Under Operating Lease Agreements | Schedule of Future Minimum Payments Under Operating Lease Agreements 2021 $ 1,330,585 2022 2,073,640 2023 1,954,903 2024 1,824,908 2025 1,232,060 Thereafter 940,976 Total lease payments $ 9,357,072 Less: Imputed interest (1,589,059 ) Present value of lease liabilities $ 7,768,013 |
GENERAL (Details Narrative)
GENERAL (Details Narrative) - USD ($) | Nov. 23, 2020 | Apr. 23, 2020 | Jun. 28, 2021 | Jun. 30, 2020 |
Schedule of Capitalization, Long-term Debt [Line Items] | ||||
Total consideration for business acquisition | $ 800,000 | |||
Aggregate amounted | $ 1,100,000 | |||
Reverse stock split description | the Company filed an amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Florida to effect a 1-for-5 reverse stock split (the “Reverse Stock Split”) of the authorized, issued and outstanding shares of the Common Stock. The Reverse Stock Split was effective as of 12:01 a.m. (Eastern Time) on November 27, 2020 (the “Effective Time”). At the Effective Time, the number of authorized shares of Common Stock was reduced from 200,000,000 shares to 40,000,000. The par value per share of Common Stock remains unchanged. As a result, each shareholder’s percentage ownership interest in the Company and proportional voting power remained unchanged. Any fractional shares resulting from the Reverse Stock Split were rounded up to the nearest whole share of Common Stock. All references to Common Stock or common stock price in these condensed consolidated financial statements have been retroactively adjusted to reflect the Reverse Stock Split. | |||
PPP Loans [Member] | ||||
Schedule of Capitalization, Long-term Debt [Line Items] | ||||
Proceeds from issuance of five separate unsecured debt | $ 2,800,000 | |||
Amount of compensation of an individual employee in excess | $ 100,000 | |||
Percentage of forgiven amount | 40.00% | |||
PPP Loans [Member] | Be Social Public Relations, LLC [Member] | ||||
Schedule of Capitalization, Long-term Debt [Line Items] | ||||
Total consideration for business acquisition | $ 304,169 |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Net loss | $ (1,349,942) | $ 2,943,601 | $ 3,922,043 | $ 869,754 | |
Accumulated deficit | $ 101,894,084 | $ 101,894,084 | $ 97,972,041 | ||
Common stock, par value | $ 0.015 | $ 0.015 | $ 0.015 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Schedule of Changes In Carrying Value of Goodwill) (Details) | 6 Months Ended | |
Jun. 30, 2021USD ($) | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill originally reported at beginning | $ 19,627,856 | |
Measurement period adjustments | (82,651) | [1] |
Business Acquisitions | 470,595 | [2] |
Adjusted goodwill at Ending | $ 20,015,800 | |
[1] | Working Capital adjustment recorded in (June 2021) in connection with the Be Social acquisition. (See Note 4) | |
[2] | Acquisition of B/HI in January 2021. |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS (Schedule of Intangible Assets) (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 | Jun. 30, 2020 |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 13,470,000 | $ 13,200,000 | |
Accumulated Amortization | 6,537,937 | $ 5,747,941 | 5,747,941 |
Net Carrying Amount | 6,932,063 | 7,452,059 | |
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 8,290,000 | 8,130,000 | |
Accumulated Amortization | 4,327,902 | 3,787,406 | |
Net Carrying Amount | 3,962,098 | 4,342,593 | |
Trademarks and Trade Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 4,490,000 | 4,440,000 | |
Accumulated Amortization | 1,570,035 | 1,330,535 | |
Net Carrying Amount | 2,919,965 | 3,109,465 | |
Noncompete Agreements [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 690,000 | 630,000 | |
Accumulated Amortization | 640,000 | 630,000 | |
Net Carrying Amount | $ 50,000 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS (Schedule of amortization expense related to intangible assets) (Details) - USD ($) | Jun. 30, 2021 | Jun. 30, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2021 (July 1 through December 31, 2021) | $ 789,995 | |
2022 | 1,367,330 | |
2023 | 1,152,421 | |
2024 | 991,715 | |
2025 | 961,373 | |
Thereafter | 1,669,229 | |
Total | $ 6,932,063 | $ 7,452,059 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Impairment of goodwill | $ 20,015,800 | |||
Amortization expense | $ 394,998 | $ 400,078 | $ 789,996 | $ 830,990 |
MERGERS AND ACQUISITIONS (Summa
MERGERS AND ACQUISITIONS (Summary of provisional fair value of consideration transferred) (Details) | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Business Combination and Asset Acquisition [Abstract] | |
Payments made to settle final indebtedness, net of minimum operating cash as defined in the B/HI Share Purchase Agreement | $ 575,856 |
Provisional working capital adjustment | 192,986 |
Provisional amount of Common Stock to be issued to the B/HI Sellers | 31,158 |
Provisional fair value of the consideration transferred | $ 800,000 |
MERGERS AND ACQUISITIONS (Sched
MERGERS AND ACQUISITIONS (Schedule of Assets Acquired and Liabilities Assumed) (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||
Goodwill | $ 20,015,800 | $ 19,627,856 |
B H I Share [Member] | ||
Business Acquisition [Line Items] | ||
Cash | 65,465 | |
Accounts receivable | 154,162 | |
Other current assets | 15,262 | |
Property, equipment and leasehold improvements | 24,639 | |
Right-of-use asset | 1,044,864 | |
Other assets | 23,617 | |
Intangibles | 270,000 | |
Total identifiable assets acquired | 1,598,009 | |
Accrued payable | (104,724) | |
Accrued expenses and other current liabilities | (259,936) | |
Lease liability | (1,044,864) | |
Deferred revenue | (56,994) | |
Line of credit | (456,527) | |
Deferred tax liability | (38,851) | |
Loans payable | (75,550) | |
Total liabilities assumed | (2,037,446) | |
Net identifiable liabilities acquired | (439,437) | |
Goodwill | 470,595 | |
Net assets acquired | $ 31,158 |
MERGERS AND ACQUISITIONS (Sch_2
MERGERS AND ACQUISITIONS (Schedule of Proforma Results of Operations) (Details) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Business Combination and Asset Acquisition [Abstract] | ||
Revenues | $ 6,161,800 | $ 13,943,911 |
Net loss | $ (3,196,376) | $ (1,427,558) |
MERGERS AND ACQUISITIONS (Detai
MERGERS AND ACQUISITIONS (Details Narrative) - USD ($) | Jan. 08, 2021 | Jun. 30, 2021 | Jun. 30, 2021 |
Business Acquisition [Line Items] | |||
Operating revenue | $ 818,408 | $ 1,426,841 | |
Net income | $ 138,161 | 157,069 | |
Working capital adjustments | $ 82,651 | ||
B H I Share Purchase Agreement [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price | $ 800,000 | ||
Additional earned | $ 1,200,000 |
DEBT (Schedule of debt) (Detail
DEBT (Schedule of debt) (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
Convertible notes payable | $ 3,050,000 | $ 1,445,000 |
Convertible notes payable - fair value option | 1,029,766 | 1,527,293 |
Notes payable | 1,226,596 | 1,273,394 |
Term loan | 700,227 | 900,292 |
Paycheck Protection Program loans | 2,037,569 | 3,099,869 |
Total debt | 8,044,158 | 8,245,848 |
Less current portion of debt | (1,851,669) | (2,909,479) |
Noncurrent portion of debt | $ 6,192,489 | $ 5,336,369 |
DEBT (Schedule of Future Annual
DEBT (Schedule of Future Annual Contractual Principal Payment Commitments of Debt) (Details) | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Debt Instrument [Line Items] | |
2021 | $ 589,613 |
2022 | 1,726,599 |
2023 | 4,698,182 |
2024 | |
2025 | |
Thereafter | $ 500,000 |
Convertible Notes Payable [Member] | |
Debt Instrument [Line Items] | |
Maturity Date | Ranging between March 2023 and March 2030 |
2021 | |
2022 | |
2023 | 3,050,000 |
2024 | |
2025 | |
Thereafter | $ 500,000 |
Nonconvertible promissory notes [Member] | |
Debt Instrument [Line Items] | |
Maturity Date | Ranging between June 2021 and December 2023 |
2021 | $ 49,953 |
2022 | 307,685 |
2023 | 868,960 |
2024 | |
2025 | |
Thereafter | |
Term loan Bank United [Member] | |
Debt Instrument [Line Items] | |
Maturity Date | March 31, 2023 |
2021 | $ 200,065 |
2022 | 400,130 |
2023 | 100,032 |
2024 | |
2025 | |
Thereafter | |
Payroll Protection Program loans [Member] | |
Debt Instrument [Line Items] | |
Maturity Date | Ranging between April 2022 and May 5, 2022 |
2021 | $ 339,595 |
2022 | 1,018,784 |
2023 | 679,190 |
2024 | |
2025 | |
Thereafter |
DEBT (Schedule of convertible n
DEBT (Schedule of convertible notes payable) (Details) | Jun. 30, 2021USD ($) |
Short-term Debt [Line Items] | |
Principal Amount | $ 3,050,000 |
Net Carrying Amount | 3,050,000 |
Fair Value Amount | 3,113,000 |
March 2023 [Member] | |
Short-term Debt [Line Items] | |
Principal Amount | 150,000 |
Net Carrying Amount | 150,000 |
Fair Value Amount | 153,000 |
April 2023 [Member] | |
Short-term Debt [Line Items] | |
Principal Amount | 1,050,000 |
Net Carrying Amount | 1,050,000 |
Fair Value Amount | 1,120,000 |
June 2023 [Member] | |
Short-term Debt [Line Items] | |
Principal Amount | 1,850,000 |
Net Carrying Amount | 1,850,000 |
Fair Value Amount | $ 1,840,000 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | Apr. 23, 2020 | Jun. 28, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 |
Short-term Debt [Line Items] | |||||||
Debt instrument face amount | $ 3,050,000 | $ 3,050,000 | |||||
Closing market price per share | $ 2.50 | $ 2.50 | |||||
Interest payments | $ 62,726 | $ 67,230 | |||||
Convertible Notes Payable | $ 3,050,000 | $ 3,050,000 | $ 1,445,000 | ||||
Convertible notes payable | 1,600,000 | ||||||
Convertible notes payable, Description | notes with a remaining aggregate principal balance of $1,100,000 were converted into 281,554 shares of Common Stock at purchase prices ranging between $3.90 and $3.91 per share. The Company had a balance of $1,029,766 and 947,293 in noncurrent liabilities as of June 30, 2021 and December 31, 2020, respectively, and $580,000 in current liabilities as of December 31, 2020 recorded on its condensed consolidated balance sheets related to the convertible promissory notes measured at fair value. The Company recorded a gain in fair value of $268,974 and a loss in fair value of $696,420 for the three months ended June 30, 2021 and 2020, respectively, and losses in fair value of $602,475 and $548,961 for the six months ended June 30, 2021 and 2020, respectively, on its condensed consolidated statements of operations. | ||||||
Interest expense | 9,863 | $ 19,726 | |||||
Cash interest payments | 19,726 | ||||||
Current liabilities | 14,520,263 | 14,520,263 | 16,852,512 | ||||
Noncurrent liabilities | 14,301,258 | 14,301,258 | 12,830,642 | ||||
Term loan | 700,227 | 700,227 | 900,292 | ||||
Business Combination, Consideration Transferred | 800,000 | ||||||
[custom:AggregateAmounted] | $ 1,100,000 | ||||||
Paycheck Protection Program loan, current portion | 848,987 | 848,987 | 582,438 | ||||
Paycheck Protection Program loan | 1,188,582 | 1,188,582 | 2,517,431 | ||||
Convertible Notes Payable [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Debt instrument face amount | $ 3,050,000 | $ 3,050,000 | |||||
Interest rate | 10.00% | 10.00% | |||||
Debt conversion, Principal | $ 1,445,000 | ||||||
Debt conversion, Accrued interest | $ 8,611 | ||||||
Debt Conversion, Shares Issued | 381,601 | ||||||
Interest expense | $ 15,565 | $ 42,482 | |||||
Interest payments | 31,149 | ||||||
Convertible Notes Payable | $ 3,050,000 | $ 3,050,000 | 1,445,000 | ||||
Convertible Notes Payable [Member] | Minimum [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Debt conversion Price | $ 3.69 | $ 3.69 | |||||
Convertible Notes Payable [Member] | Maximum [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Debt conversion Price | $ 3.96 | $ 3.96 | |||||
Nonconvertible promissory notes [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Debt instrument face amount | $ 1,400,000 | $ 1,400,000 | |||||
Interest rate | 10.00% | 10.00% | |||||
Interest expense | $ 30,927 | $ 33,347 | $ 62,449 | 67,230 | |||
Current liabilities | 302,455 | 302,455 | 846,749 | ||||
Noncurrent liabilities | $ 924,141 | $ 924,141 | $ 426,645 | ||||
Term Loan [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Term loan | $ 700,227 | $ 700,227 | |||||
PPP Loans [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Proceeds from Issuance of Unsecured Debt | $ 2,800,000 | ||||||
PPP Loans [Member] | Be Social Public Relations, LLC [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Business Combination, Consideration Transferred | $ 304,169 |
LOANS FROM RELATED PARTY (Detai
LOANS FROM RELATED PARTY (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2016 | |
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||||
Debt instrument amount | $ 3,050,000 | $ 3,050,000 | ||||
Interest expense | 169,837 | $ 1,058,694 | 335,031 | $ 1,682,976 | ||
Accrued interest | 1,718,227 | 1,718,227 | $ 1,783,121 | |||
Loan from related party | 1,107,873 | |||||
Notes Payable, Other Payables [Member] | DE New Promissory Note [Member] | Chief Executive Officer [Member] | ||||||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||||||
Debt instrument amount | $ 1,009,624 | |||||
Interest expense | 27,621 | $ 27,621 | 54,938 | $ 55,242 | ||
Accrued interest | 1,107,873 | 1,107,873 | $ 26,683 | |||
Loan from related party | $ 81,621 | $ 81,621 |
FAIR VALUE MEASUREMENTS (Schedu
FAIR VALUE MEASUREMENTS (Schedule of Liability Fair Value Categorized Within Level 3) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Loss in fair value reported in condensed consolidated the statement of operations | $ 65,000 | $ (483,519) | $ (2,497,877) | $ (411,004) |
Put Option [Member] | The Door [Member] | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Beginning fair value balance reported on the consolidated balance sheet | 1,544,029 | |||
Put rights exercised | (1,015,135) | |||
Loss in fair value reported in condensed consolidated the statement of operations | 71,106 | |||
Put rights converted into common stock | (600,000) | (600,000) | ||
Ending fair value balance reported on the consolidated balance sheet |
FAIR VALUE MEASUREMENTS (Sche_2
FAIR VALUE MEASUREMENTS (Schedule of Fair Value Assumptions Used to Value Liabilities, Put Rights) (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Put Option [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Annual Asset Volatility Estimate | 87.50% | 73.50% |
Put Option [Member] | Minimum [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Risk Free Discount Rate (based on US government treasury obligation with a term similar to that of the Contingent Consideration) | 0.16% | 0.13% |
Put Option [Member] | Maximum [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Risk Free Discount Rate (based on US government treasury obligation with a term similar to that of the Contingent Consideration) | 0.36% | 0.17% |
The Door [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Risk Free Discount Rate (based on US government treasury obligation with a term similar to that of the Contingent Consideration) | 0.06% | 0.16% |
Annual Asset Volatility Estimate | 82.50% | 60.00% |
FAIR VALUE MEASUREMENTS (Sche_3
FAIR VALUE MEASUREMENTS (Schedule of fair value categorized within Level 3) (Details) - Contingent Consideration [Member] | 6 Months Ended |
Jun. 30, 2021USD ($) | |
The Door [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning fair value balance reported on the consolidated balance sheet | $ 370,000 |
Loss in fair value reported in the condensed consolidated statement of operations | 180,000 |
Ending fair value balance reported on the consolidated balance sheet | 550,000 |
Put Option [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning fair value balance reported on the consolidated balance sheet | 160,000 |
Loss in fair value reported in the condensed consolidated statement of operations | 20,000 |
Ending fair value balance reported on the consolidated balance sheet | $ 180,000 |
FAIR VALUE MEASUREMENTS (Sche_4
FAIR VALUE MEASUREMENTS (Schedule of Fair Value Assumptions Used to Value Liabilities) (Details) - Convertible Note Payable 1 [Member] | 6 Months Ended |
Jun. 30, 2021USD ($) | |
January 3 [Member] | |
Obligation with Joint and Several Liability Arrangement [Line Items] | |
Beginning fair value balance on issue date | $ 436,155 |
Loss in fair value reported in the condensed consolidated statement of operations | 103,845 |
[custom:Exercised] | (540,000) |
Ending fair value balance | |
March 4 [Member] | |
Obligation with Joint and Several Liability Arrangement [Line Items] | |
Beginning fair value balance on issue date | 511,136 |
Loss in fair value reported in the condensed consolidated statement of operations | 518,630 |
[custom:Exercised] | |
Ending fair value balance | 1,029,766 |
March 25 [Member] | |
Obligation with Joint and Several Liability Arrangement [Line Items] | |
Beginning fair value balance on issue date | 580,000 |
Loss in fair value reported in the condensed consolidated statement of operations | (20,000) |
[custom:Exercised] | (560,000) |
Ending fair value balance |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2021 | Mar. 25, 2021 | Mar. 04, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Debt instrument amount | $ 3,050,000 | ||
Series E F G And H Warrants [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Warrants exercised | 146,027 | ||
Put Option [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Shares exercised during the period | 22,867 | ||
Payment for shares exercised | $ 1,015,135 | ||
Additional Shares exercised, Value | $ 600,000 | ||
Additional Shares exercised, shares | 115,366 | ||
Contingent Consideration [Member] | B H I [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Shares issued in Earn Out Consideration, value | $ 1,200,000 | ||
Debt instrument amount | $ 1,300,000 | $ 560,000 | $ 500,000 |
FAIR VALUE MEASUREMENTS (Sche_5
FAIR VALUE MEASUREMENTS (Schedule of estimated fair value) (Detail) - B H I [Member] - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Convertible note payable [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Expected term (years) | 8 years 8 months 4 days | 9 years 2 months 4 days |
Contingent Consideration [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Face value principal payable | $ 500,000 | $ 500,000 |
Original conversion price | $ 3.91 | $ 3.91 |
Value of Common Stock | $ 9.34 | $ 3.40 |
Volatility | 100.00% | 100.00% |
Risk free rate | 1.34% | 0.93% |
FAIR VALUE MEASUREMENTS (Warran
FAIR VALUE MEASUREMENTS (Warrants measured at fair value) (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Series I Warrants [Member] | ||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||
Aggregate Fair Value | $ 150,000 | $ 50,000 |
Exercise Price per share | $ 3.91 | $ 3.91 |
Value of Common Stock | $ 9.34 | $ 3.40 |
Expected term (years) | 4 years 2 months 1 day | 4 years 8 months 1 day |
Volatility | 100.00% | 100.00% |
Dividend yield | 0.00% | 0.00% |
Risk free rate | 0.70% | 0.31% |
Convertible Note Payable 2 [Member] | B H I [Member] | ||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||
Beginning fair value balance on issue date | $ 400,000 | |
Gain in fair value reported in the condensed consolidated statement of operations | 2,397,877 | |
Exercised | (2,797,877) | |
Ending fair value balance | $ 400,000 | |
Convertible Note Payable 2 [Member] | Series I [Member] | ||
Obligation with Joint and Several Liability Arrangement [Line Items] | ||
Beginning fair value balance on issue date | 50,000 | |
Gain in fair value reported in the condensed consolidated statement of operations | 100,000 | |
Exercised | ||
Ending fair value balance | $ 150,000 | $ 50,000 |
CONTRACT LIABILITIES (Details N
CONTRACT LIABILITIES (Details Narrative) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Revenue from Contract with Customer [Abstract] | ||
Contract liabilities | $ 3,175,917 | $ 1,855,209 |
VARIABLE INTEREST ENTITIES (Sum
VARIABLE INTEREST ENTITIES (Summary of Financial Information for Variable Interest Entities) (Details) - JB Believe, LLC [Member] - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||||
Assets | $ 251,671 | $ 251,671 | $ 190,347 | ||
Liabilities | (6,750,088) | (6,750,088) | $ (6,749,914) | ||
Revenues | |||||
Expenses |
VARIABLE INTEREST ENTITIES (Det
VARIABLE INTEREST ENTITIES (Details Narrative) - JB Believe, LLC [Member] | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Repayments of investments | $ 3,200,000 |
Amount paid to release film | 5,000,000 |
Producer fee owed to lender | $ 6,301,314 |
STOCKHOLDERS' EQUITY (Schedule
STOCKHOLDERS' EQUITY (Schedule of common stock outstanding) (Details) | 6 Months Ended |
Jun. 30, 2021shares | |
Equity [Abstract] | |
Balance At beginning | 6,618,785 |
Conversion of Stock, Shares Issued | 663,155 |
Conversion of Stock, Shares Converted | 146,027 |
Issued to seller of Be Social | 103,245 |
Exchange of Put Rights for stock | 115,366 |
Issued to seller of The Door | 10,238 |
Shares retired from exercise of puts | (18,347) |
Balance At end | 7,638,469 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2021 | Dec. 31, 2020 | Jul. 06, 2017 | |
Class of Stock [Line Items] | |||
Preferred stock, authorized shares | 10,000,000 | ||
Description of voting rights | DE LLC, as the holder of the Series C is entitled to 14,216,819 votes, which are equal to approximately 65% of the voting securities of the Company. | ||
Series C Convertible Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred stock, authorized shares | 50,000 | ||
Preferred stock, par value | $ 0.001 | ||
Preferred stock liquidation value | $ 0.001 | ||
Series C Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred stock, authorized shares | 50,000 | 50,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Shares issued in conversion of debt, value | $ 4,738,940 |
(LOSS) EARNINGS PER SHARE (Deta
(LOSS) EARNINGS PER SHARE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Numerator | ||||
Net income (loss) | $ 1,349,942 | $ (2,943,601) | $ (3,922,043) | $ (869,754) |
Net income attributable to participating securities | (8,750) | |||
Net income (loss) attributable to Dolphin Entertainment common stock shareholders and numerator for basic earnings (loss) per share | 1,341,192 | (2,943,601) | (3,922,043) | (869,754) |
Change in fair value of put rights | (1,517,810) | |||
Change in fair value of derivative liability | (268,974) | |||
Change in fair value of warrants | (65,000) | |||
Interest expense | 36,862 | |||
Numerator for diluted earnings (loss) per share | $ 1,044,080 | $ (2,943,601) | $ (3,922,043) | $ (2,387,564) |
Denominator | ||||
Denominator for basic EPS - weighted-average shares | 7,664,000 | 4,719,241 | 7,456,360 | 4,363,742 |
Effect of dilutive securities: | ||||
Put rights | 850,613 | |||
Convertible notes payable | $ 237,483 | |||
Denominator for diluted EPS - adjusted weighted-average shares | 7,913,396 | 4,719,241 | 7,456,360 | 5,214,355 |
Basic earnings (loss) per share | $ 0.17 | $ (0.62) | $ (0.53) | $ (0.20) |
Diluted earnings (loss) per share | $ 0.13 | $ (0.62) | $ (0.53) | $ (0.46) |
EARNINGS (LOSS) PER SHARE (Deta
EARNINGS (LOSS) PER SHARE (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Earnings Per Share [Abstract] | ||||
Deemed dividend attributable to participating securities | $ 8,750 | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,061,635 | 304,613 | 3,177,253 |
WARRANTS (Schedule of Warrant A
WARRANTS (Schedule of Warrant Activity) (Details) - Warrant [Member] | 6 Months Ended |
Jun. 30, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Balance at December 31 | shares | 221,513 |
Balance at December 31 | $ / shares | $ 7.08 |
Issued | shares | |
Issued | $ / shares | |
Exercised | shares | (166,072) |
Exercised | $ / shares | $ 0 |
Expired | shares | (35,441) |
Expired | $ / shares | $ 23.70 |
Balance at December 31 | shares | 20,000 |
Balance at December 31 | $ / shares | $ 3.91 |
WARRANTS (Details Narrative)
WARRANTS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Mar. 04, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Warrant liability | $ 150,000 | $ 150,000 | $ 50,000 | |
Operating loss | 2,397,877 | |||
Series I Warrants [Member] | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Warrants to purchase common stock | 20,000 | |||
Exercise price | $ 3.91 | |||
Derivative liabilities | $ 40,000 | |||
Change in fair value (gain) of derivative liability | $ 65,000 | $ 100,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||||
Annual Compensation Description | CEO, which provides for annual compensation of $250,000 and an annual discretionary bonus as determined by the Board. Unpaid compensation accrues interest at a rate of 10% per annum. In 2019, the Compensation Committee approved an increase in Mr. O’Dowd’s annual salary to $300,000. On May 17, 2021, the Compensation Committee of the Board approved an increase in the base salary of Mr. O’Dowd from $300,000 to $400,000 per year. The increase was effective January 1, 2021. | ||||
Accrued compensation | $ 300,000 | $ 400,000 | $ 300,000 | $ 400,000 | |
Interest expense related party | 65,445 | $ 65,445 | 130,171 | $ 130,890 | |
Interest paid related to accrued compensation | 168,379 | $ 168,379 | |||
Number of options exercised | 6,507 | ||||
Chief Executive Officer [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accrued compensation | 2,625,000 | $ 2,625,000 | $ 2,625,000 | ||
Accrued interest | $ 1,718,227 | $ 1,718,227 | $ 1,756,438 | ||
Ms. Leslee Dart [Member] | Put Option [Member] | |||||
Related Party Transaction [Line Items] | |||||
Price per share | $ 46.10 | $ 46.10 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Revenue from External Customer [Line Items] | |||||
Revenue | $ 8,643,244 | $ 5,194,725 | $ 15,820,361 | $ 11,828,525 | |
Total operating loss | 56,293 | (179,038) | (1,138,647) | (1,049,898) | |
Interest expense | (169,837) | (1,058,694) | (335,031) | (1,682,976) | |
Other income, net | 1,463,486 | (1,705,869) | (2,487,216) | 1,863,120 | |
Loss before income taxes | 1,349,942 | (2,943,601) | (3,960,894) | (869,754) | |
Total assets | 50,994,181 | 50,994,181 | $ 49,351,951 | ||
E P D [Member] | |||||
Revenue from External Customer [Line Items] | |||||
Revenue | 8,643,244 | 5,194,725 | 15,820,361 | 11,828,525 | |
Total operating loss | 1,391,171 | 875,831 | 602,295 | 216,757 | |
Total assets | 47,699,370 | 47,699,370 | 45,266,315 | ||
C P D [Member] | |||||
Revenue from External Customer [Line Items] | |||||
Revenue | |||||
Total operating loss | (1,334,878) | $ (1,054,869) | (1,740,942) | $ (1,266,655) | |
Total assets | $ 3,294,811 | $ 3,294,811 | $ 4,085,636 |
SEGMENT INFORMATION (Details Na
SEGMENT INFORMATION (Details Narrative) - USD ($) | 6 Months Ended | |||
Jun. 30, 2021 | Dec. 31, 2020 | Jun. 30, 2020 | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||
Accumulated amortization on intangible assets | $ 6,537,937 | $ 5,747,941 | $ 5,747,941 | |
Goodwill acquired | [1] | 470,595 | ||
42 West, The Door and Viewpoint, Shore Media [Member] | ||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | 6,932,063 | |||
Accumulated amortization on intangible assets | 6,537,937 | |||
Goodwill acquired | $ 20,015,800 | |||
[1] | Acquisition of B/HI in January 2021. |
LEASES (Schedule of Lease Incom
LEASES (Schedule of Lease Income and Expenses) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Net lease costs | $ 664,315 | $ 612,970 | $ 1,471,704 | $ 1,180,041 |
Selling, General and Administrative Expenses [Member] | ||||
Operating lease costs | 664,315 | 554,506 | 1,410,843 | 1,063,113 |
Sublease income | (2,397) | (4,794) | ||
Direct costs [Member] | ||||
Operating lease costs | $ 60,861 | $ 60,861 | $ 121,722 |
LEASES (Schedule of Maturities
LEASES (Schedule of Maturities of Lease Liabilities) (Details) | Jun. 30, 2021USD ($) |
Leases | |
2021 | $ 1,330,585 |
2022 | 2,073,640 |
2023 | 1,954,903 |
2024 | 1,824,908 |
2025 | 1,232,060 |
Thereafter | 940,976 |
Total lease payments | 9,357,072 |
Less: Imputed interest | (1,589,059) |
Present value of lease liabilities | $ 7,768,013 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021USD ($) | Jun. 30, 2021USD ($) | |
Leases | ||
Operating lease payment | $ 663,738 | $ 1,402,896 |
Operating lease term | 4 years 5 months 8 days | 4 years 5 months 8 days |
Percentage of annual increase in lease amount | 5.79% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Letter of Credit description | On July 24, 2018, the Company renewed the letter of credit issued by City National Bank for the 42West office space in New York. The letter of credit is for $677,354 and originally expired on August 1, 2018. This letter of credit renews automatically annually unless City National Bank notifies the landlord 60-days prior to the expiration of the bank’s election not to renew the letter of credit. The Company granted City National Bank a security interest in bank account funds totaling $677,354 pledged as collateral for the letter of credit. The letters of credit commit the issuer to pay specified amounts to the holder of the letter of credit under certain conditions. If this were to occur, the Company would be required to reimburse the issuer of the letter of credit. |