Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 19, 2023 | |
Document Information Line Items | ||
Entity Registrant Name | RYVYL INC. | |
Trading Symbol | RVYL | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 51,343,821 | |
Amendment Flag | false | |
Entity Central Index Key | 0001419275 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Mar. 31, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-34294 | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 22-3962936 | |
Entity Address, Address Line One | 3131 Camino Del Rio North, Suite 1400 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92108 | |
City Area Code | 619 | |
Local Phone Number | -631-8261 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 17,742 | $ 13,961 |
Restricted cash | 39,396 | 26,873 |
Accounts receivable, net of allowance for bad debt of $28 and $82, respectively | 859 | 1,156 |
Cash due from gateways, net of allowance of $9,326 and $9,326, respectively | 7,309 | 7,427 |
Prepaid and other current assets | 4,061 | 9,798 |
Total current assets | 69,367 | 59,215 |
Non-current Assets: | ||
Property and equipment, net | 1,676 | 1,696 |
Other assets | 2,214 | 197 |
Goodwill | 26,753 | 26,753 |
Intangible assets, net | 6,156 | 6,739 |
Operating lease right-of-use assets, net | 1,363 | 1,533 |
Investments - assets | 687 | 1,524 |
Total non-current assets | 38,849 | 38,442 |
Total Assets | 108,216 | 97,657 |
Current Liabilities: | ||
Accounts payable | 9,775 | 1,630 |
Other current liabilities | 2,852 | 3,662 |
Accrued interest | 2,437 | 1,728 |
Payment processing liabilities, net | 37,013 | 28,912 |
Short-term notes payable | 15 | 14 |
Derivative liability | 87 | 255 |
Current portion of operating lease liabilities | 353 | 534 |
Total current liabilities | 52,532 | 36,735 |
Long term debt, net of debt discount | 64,353 | 61,735 |
Operating lease liabilities, less current portion | 965 | 1,109 |
Total liabilities | 117,850 | 99,579 |
Commitments and contingencies | ||
Stockholders' Equity: | ||
Common stock, par value $0.001, 82,500,000 shares authorized, shares issued and outstanding of 51,335,650 and 49,727,355, respectively | 51 | 49 |
Common stock issuable, par value $0.001 | 0 | 2 |
Additional paid-in capital | 96,234 | 96,271 |
Accumulated other comprehensive income | 1,538 | 1,596 |
Accumulated deficit | (107,457) | (99,772) |
Less: Shares to be returned | 0 | (68) |
Total stockholders' equity | (9,634) | (1,922) |
Total liabilities and stockholders’ equity | $ 108,216 | $ 97,657 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for bad debt (in Dollars) | $ 28 | $ 82 |
Cash due from gateways, allowance (in Dollars) | $ 9,326 | $ 9,326 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 82,500,000 | 82,500,000 |
Common stock shares issued | 51,335,650 | 49,727,355 |
Common stock, shares outstanding | 51,335,650 | 49,727,355 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Revenue | $ 11,291 | $ 4,210 |
Cost of Goods Sold | 6,178 | 2,780 |
Gross Profit | 5,113 | 1,430 |
Operating expenses: | ||
Advertising and marketing | 75 | 141 |
Research and development | 1,936 | 1,938 |
General and administrative | 1,452 | 1,792 |
Payroll and payroll taxes | 2,714 | 2,384 |
Professional fees | 1,803 | 1,505 |
Stock compensation expense | 193 | 293 |
Depreciation and amortization | 620 | 454 |
Total operating expenses | 8,793 | 8,507 |
Loss from operations | (3,680) | (7,077) |
Other income (expense): | ||
Interest expense | (1,729) | (3,830) |
Interest expense - debt discount | (2,622) | (5,521) |
Loss on settlement of debt | 0 | (900) |
Changes in fair value of derivative liability | 168 | (7,700) |
Merchant fines and penalty income | 0 | 45 |
Other income or expense | (111) | (4,364) |
Total other expense, net | (4,294) | (22,270) |
Loss before provision for income taxes | (7,974) | (29,347) |
Income tax provision | 5 | 80 |
Net Income (loss) | (7,979) | (29,427) |
Comprehensive income statement: | ||
Net loss | (7,979) | (29,427) |
Foreign currency translation loss | (58) | 0 |
Total comprehensive loss | $ (8,037) | $ (29,427) |
Net loss per share: | ||
Basic and diluted (in Dollars per share) | $ (0.15) | $ (0.72) |
Weighted average number of common shares outstanding: | ||
Basic and diluted (in Shares) | 52,210,597 | 40,708,304 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Common Stock to be Issued [Member] | Common Stock to be Returned [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Treasury Stock, Common [Member] | Total |
Balance at Dec. 31, 2021 | $ 43 | $ (9,852) | $ 94,748 | $ (50,537) | $ (4,934) | $ 29,468 | ||
Balance (in Shares) at Dec. 31, 2021 | 43,546,647 | (1,436,888) | (714,631) | |||||
Common stock issued for services | 126 | 126 | ||||||
Common stock issued for services (in Shares) | 30,508 | 9 | ||||||
Common stock issued for shareholder | $ 1 | (1) | ||||||
Common stock issued for shareholder (in Shares) | 33,333 | 533 | ||||||
Stock compensation expense | 167 | 167 | ||||||
Net loss | (29,427) | (29,427) | ||||||
Common stock issued for stock options exercised | 5 | $ 5 | ||||||
Common stock issued for stock options exercised (in Shares) | 12,417 | 13,019 | ||||||
Common stock contributed and cancelled from shareholder | $ 6,989 | (6,686) | $ (3,539) | $ (3,237) | ||||
Common stock contributed and cancelled from shareholder (in Shares) | (333,333) | 800,000 | (1,483,755) | |||||
Common stock issuable - Acquisition of Sky assets | $ 1 | 2,110 | 2,110 | |||||
Common stock issuable - Acquisition of Sky assets (in Shares) | 500 | |||||||
Common stock shares contributed by shareholder | $ (1) | 1 | ||||||
Common stock shares contributed by shareholder (in Shares) | (500) | |||||||
Net loss and comprehensive loss | (29,427) | |||||||
Balance at Mar. 31, 2022 | $ 43 | $ 1 | $ (2,863) | 90,470 | (79,963) | $ (8,473) | (786) | |
Balance (in Shares) at Mar. 31, 2022 | 43,289,572 | 542,238 | (636,888) | (2,198,386) | ||||
Balance at Dec. 31, 2022 | $ 49 | $ 2 | $ (68) | 96,271 | $ 1,596 | (99,772) | (1,922) | |
Balance (in Shares) at Dec. 31, 2022 | 49,727,355 | 1,753,916 | (136,888) | |||||
Net loss | $ (7,979) | |||||||
Common stock issued for stock options exercised (in Shares) | 0 | |||||||
Common stock issued to employees as stock compensation | 31 | $ 31 | ||||||
Common stock issued to employees as stock compensation (in Shares) | (8,906) | |||||||
Common stock issued for interest on convertible debt | $ 2 | $ (2) | ||||||
Common stock issued for interest on convertible debt (in Shares) | 1,753,916 | (1,753,916) | ||||||
Carryover effects of financial statement restatements in prior periods | 294 | 294 | ||||||
Share repurchase | $ 68 | (68) | ||||||
Share repurchase (in Shares) | (136,715) | 136,888 | ||||||
Net loss and comprehensive loss | (58) | (7,979) | (8,037) | |||||
Balance at Mar. 31, 2023 | $ 51 | $ 96,234 | $ 1,538 | $ (107,457) | $ (9,634) | |||
Balance (in Shares) at Mar. 31, 2023 | 51,335,650 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands, € in Millions | 3 Months Ended | |
Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | |
Statement of Cash Flows [Abstract] | ||
Net loss | $ (7,979) | $ (29,427) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization expense | 620 | 454 |
Noncash lease expense | 913 | 0 |
Stock compensation expense | 193 | 167 |
Restricted stock issued for services | 0 | 126 |
Interest expense - debt discount | 2,622 | 4,262 |
Derivative expense (benefit) | (168) | 7,700 |
Changes in assets and liabilities: | ||
Accounts receivable | 296 | 13 |
Prepaid and other current assets | 5,741 | (80) |
Cash due from gateways, net | 119 | (5,962) |
Other assets | (2,017) | 18 |
Accounts payable | 8,144 | 153 |
Other current liabilities | (915) | 110 |
Accrued interest | 709 | 2,490 |
Payment processing liabilities, net | 8,101 | 5,507 |
Net cash provided by (used in) operating activities | 16,379 | (14,469) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (17) | (66) |
Cash provided for Transact Europe Holdings OOD Acquisition | 0 | (28,811) |
Cash provided for Sky Financial & Intelligence asset acquisition | 0 | (16,000) |
Net cash used in investing activities | (17) | (44,877) |
Cash flows from financing activities: | ||
Treasury stock purchases | 0 | (3,540) |
Proceeds from stock option exercises | 0 | 5 |
Borrowings (repayments) from convertible debt | 0 | (6,000) |
Net cash provided by financing activities | 0 | (9,535) |
Effect of exchange rate changes on cash | (58) | 0 |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 16,304 | (68,881) |
Cash, cash equivalents, and restricted cash – beginning of period | 40,834 | 89,560 |
Cash, cash equivalents, and restricted cash – end of period | 57,138 | 20,679 |
Cash paid during the period for: | ||
Interest | 1,000 | 4,891 |
Income taxes | 0 | 0 |
Common stock issued for acquisition of Sky Financial | $ 0 | $ 2,110 |
Description of the Business and
Description of the Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | 1. Description of the Business and Basis of Presentation Organization RYVYL Inc. is a financial technology company that develops, markets, and sells innovative blockchain-based payment solutions, which we believe offer significant improvements for the payment solutions marketplace. The Company’s core focus is to develop and monetize disruptive blockchain-based applications, integrated within an end-to-end suite of financial products, capable of supporting a multitude of industries. The Company’s proprietary, blockchain-based systems are designed to facilitate, record, and store a virtually limitless volume of tokenized assets, representing cash or data, on a secured, immutable blockchain-based ledger. The Company was formerly known as ASAP Expo, Inc (“ASAP”), and was incorporated in the state of Nevada on April 10, 2007. On January 4, 2020, PubCo and GreenBox POS LLC, a Washington limited liability company (“PrivCo”), entered into an Asset Purchase Agreement (the “Agreement”), to memorialize a verbal agreement (the “Verbal Agreement”) entered into on April 12, 2018, by and among PubCo (the Buyer) and PrivCo (the Seller). On April 12, 2018, pursuant to the Verbal Agreement, the Company acquired PrivCo’s blockchain gateway and payment system business, point of sale system business, delivery business and kiosk business, bank and merchant accounts, as well as all intellectual property related thereto (the “GreenBox Business”). As consideration for the GreenBox Business, on April 12, 2018, the Company assumed PrivCo’s liabilities that had been incurred in the normal course of the GreenBox Business. On May 3, 2018, the Company formally changed its name to GreenBox POS. LLC, then subsequently changed its name to GreenBox POS on December 13, 2018. On October 13, 2022, GreenBox POS changed its name to RYVYL Inc. On May 21, 2021, the Company acquired all of the outstanding stock of Northeast Merchant Systems, Inc. (“Northeast”) in a transaction treated as a business combination. Northeast is a merchant services company providing merchant credit card processing through its own Bank Identification Number (BIN) with the acquiring bank Merrick. This involves inside operations for new merchants that include sales assistance and applications processing, underwriting, and onboarding; inside operations for existing merchants include risk monitoring and customer service. Outside operations include: equipment service or replacement; sales calls and applications, site inspections and identity verification; security verification; and on-site customer service and technical support. On July 13, 2021 (the “Closing Date”), the Company entered into and closed on a Membership Interest Purchase Agreement (the “Purchase Agreement”) with Charge Savvy LLC, an Illinois limited liability company (“Charge Savvy”), and Charge Savvy’s three members (collectively, the “Sellers”). One of the Sellers, Ken Haller, was an employee of the Company on the Closing Date. As a result of the Purchase Agreement, the Company purchased all of Charge Savvy’s issued and outstanding membership interests from the Sellers and Charge Savvy became a wholly owned subsidiary of the Company. Although the Purchase Agreement is dated July 9, 2021, it was entered into and closed on July 13, 2021. The consideration for the all-stock transaction consisted of 1,000,000 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”) being issued and delivered to Sellers in proportion to the Sellers’ share of their membership interests in Charge Savvy. The share price at issuance was $12.14. Charge Savvy is a Fintech company specializing in developing software and providing payment processing and point-of-sale services to the merchant services industry. Charge Savvy also owns a 64,000 square foot office building in Chicago, Illinois, where it is headquartered. On March 31, 2022, the Company closed a transaction to acquire a portfolio of merchant accounts from Sky Financial & Intelligence for $18.1 million. The Company paid $16.0 million in cash in March 2022 and issued 500,000 shares of restricted common stock for the transaction in May 2022. On April 1, 2022, the Company completed the acquisition of Transact Europe Holdings OOD. Transact Europe EAD (TEU) is an EU regulated electronic money institution headquartered in Sofia Bulgaria. TEU is a Principal Level Member of Visa, a Worldwide Member of MasterCard, and a Principal Member of China UnionPay. In addition, TEU is part of the direct SEPA program. With a global footprint, proprietary payment gateway, and technology platforms, TEU offers a comprehensive portfolio of services and decades of industry experience. TEU provides complete payment solutions by offering acquiring, issuing of prepaid cards and agent banking, serving hundreds of clients. The Company paid $28.8 million (€26.0 million) in total consideration for the purchase. Please also refer to Note 15 entitled “ Subsequent Events Basis of Presentation and Consolidation The accompanying interim consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. All intercompany transactions and balances have been eliminated in the accompanying consolidated financial statements. Unaudited Interim Financial Information Certain information and footnote disclosures normally included in the Company’s annual audited financial statements and accompanying notes have been condensed or omitted in this accompanying interim consolidated financial statements and footnotes. Accordingly, the accompanying interim consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | 2. Summary of Significant Accounting Policies The results of operations presented in this quarterly report on Form 10-Q are not necessarily indicative of the results of operations that may be expected for any future periods. In the opinion of management, these unaudited consolidated financial statements include all adjustments and accruals, consisting only of normal, recurring adjustments that are necessary for a fair statement of the results of all interim periods reported herein. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flows. Cash, Cash Equivalents and Restricted Cash The Company’s cash, cash equivalents and restricted cash represents the following: ● Cash and cash equivalents ● Restricted cash Cash Due from Gateways and Payment Processing Liabilities The Company’s primary source of revenues consists of payment processing services for its merchant clients. When a merchant makes a sale, the process of receiving the payment card information, engaging the banks for transferring the proceeds to the merchant’s account via digital gateways, and recording the transaction on a blockchain ledger are the activities for which the Company collects fees. In the first quarter of 2023 and the year ended December 31, 2022, the Company utilized several gateways. The gateways have strict guidelines pertaining to scheduling of the release of funds to merchants based on several criteria, such as, among other things, return and chargeback history, associated risks for specific business verticals, and average transaction amounts. To mitigate processing risks, these policies determine reserve requirements and payment-in-arrears strategies. While reserve and payment-in-arrears restrictions are in effect for a merchant payout, the Company records receivables from the gateways against these amounts until released. Cash due from gateways balances presented in the accompanying consolidated balance sheets represent the amount due to the Company for transactions processed wherein the funds have not been distributed. Research and Development Costs Research and development costs, which are expensed as incurred, are primarily comprised of costs and expenses for salaries and benefits of research and development personnel, outsourced contract services, and supplies and materials. Revenue Recognition Revenue is recognized upon transfer of control of promised goods or services to the Company’s customers or when the Company satisfies any performance obligations under contract. The amount of revenue represents consideration the Company expects to be entitled to in exchange for the respective goods or services provided. Under Accounting Standards Codification 606, “ Revenue from Contracts with Customers The Company’s primary revenue source is generated from payment processing services. Payment processing services revenue is based on a percentage of each transaction’s value and/or upon fixed amounts specified per each transaction or service and is recognized as such transactions or services are performed, at a point in time. Accounts Receivable and Allowance for Credit Losses The Company maintains an allowance for credit losses for estimated losses from the inability of gateways to make required payments. The allowance for credit losses is evaluated periodically based on the aging of accounts receivable, the operational relationship with gateways and their payment history, historical charge-off experience and other assumptions, such as current assessment of economic conditions. Prepaid Expenses Prepaid expenses primarily consist of deposits made with credit card companies under Transact Europe Holdings OOD and the prepayment associated with other acquisitions. Property and Equipment Property and equipment are stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the assets, which range from three to eight years. Leasehold improvements are amortized over the shorter of the useful life of the related assets or the lease term. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is recognized in the period the transaction occurs. Fair Value of Financial Instruments The Company assesses the fair value of financial instruments based on the provisions of ASC 820, Fair Value Measurements ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1- Quoted prices in active markets for identical assets or liabilities. Level 2- Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3- Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table describes the valuation techniques used to calculate the fair value for assets in Level 3. The significant unobservable input used in the fair value measurement of the Company’s identifiable intangible assets is the discount rate. The change in this input could result in a change of fair value measurement (dollars in thousands): Fair Value at March 31, 2023 Customer relationships $ 4,407 Business intellectual properties 1,748 Derivative Liability 87 Fair Value at December 31, 2022 Customer relationships $ 4,857 Business intellectual properties 1,882 Derivative liability 255 Goodwill and Other Intangible Assets The Company accounts for acquisitions of businesses in accordance with the acquisition method of accounting which requires assets and liabilities to be recognized at their fair values on the acquisition date. Goodwill represents the excess of the purchase price of acquired businesses over the fair value of the identifiable assets acquired and liabilities assumed. Acquisition costs are expensed as incurred. Goodwill and other intangible assets acquired in a business combination determined to have an indefinite useful life are generally not amortized, but instead are tested for impairment at least annually and more frequently if events and circumstances indicate that the asset might be impaired. An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value. Other intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values. Impairment of Long-Lived Assets Long-lived assets are reviewed for impairment whenever management believes that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. To the extent that the carrying value is determined to be unrecoverable, an impairment loss is recognized through a charge to expense. As of December 31, 2022, other than a charge off of the entire consideration paid in connection with the contracted acquisition of the Sky Financial portfolio, the Company performed an impairment analysis on the other acquired goodwill and other long-lived assets and concluded that their values are supportable and recoverable. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, net of operating loss carry forwards and credits, by applying enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all the deferred tax assets will not be realized. Judgment is required in determining and evaluating income tax provisions and valuation allowances for deferred income tax assets. We recognize an income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. As of March 31, 2023, and December 31, 2022, we have valuation allowances which serve to reduce net deferred tax assets. Earnings Per Share Basic earnings per share is computed by dividing net income to common stockholders by the weighted average number of shares outstanding for the periods presented. Dilutive earnings per share includes the effect of any potentially dilutive debt or equity under the treasury stock method, if including such instruments is dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the years ended December 31, 2022, and three-month periods ended March 31, 2023, and 2022, since there are no potential shares outstanding that would have a dilutive effect. Leases On February 25, 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. ASC 842 requires that lessees recognize right of use assets and lease liabilities calculated based on the net present value of lease payments for all lease agreements with terms that are greater than twelve months. ASC 842 distinguishes leases as either a finance lease or an operating lease that affects how the leases are measured and presented in the statements of operations and statements of changes in cash flows. ASC 842 supersedes nearly all existing lease accounting guidance under GAAP issued by the Financial Accounting Standards Board (“FASB”) including ASC Topic 840, Leases. For operating leases, we calculated right of use assets and lease liabilities based on the net present value of the remaining lease payments as of the adoption date using our incremental borrowing rate as of that date. Segment Reporting The Company has organized its operations into two segments: North America and International. These segments reflect the way management evaluates its business performance and manages its operations. Our chief operating decision maker is our chief executive officer. Management has determined that the operational data used by our chief operating decision maker is that of the two reportable segments. Management bases strategic goals and decisions on these segments. Management evaluates the performance of its segments and allocates resources based on operating income or (loss) as compared to prior periods and current performance levels. Recent Accounting Standard Adopted In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses”. The standard, including subsequently issued amendments (ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-10 and ASU 2019-11), requires a financial asset measured at amortized cost basis, such as accounts receivable and certain other financial assets, to be presented at the net amount expected to be collected based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. In November 2019, the FASB issued ASU No. 2019-10 to postpone the effective date of ASU No. 2016-13 for public business entities eligible to be smaller reporting companies defined by the SEC to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company has adopted this accounting standard, effective January 1, 2023. Management assessed the adoption of this standard on the effective date and concluded that the adoption did not have a material effect on our consolidated financial condition, results of operations, and cash flows during the period ended March 31, 2023. Recent Accounting Standards and Guidance Not Adopted In October 2021, the FASB issued ASU 2021-08, “ Business Combinations Accounting for Contract Assets and Contract Liabilities from Contracts with Customers Revenue from Contracts with Customers The FASB issued ASU 2020-06 (“Update”) to simplify the accounting for convertible instruments by eliminating large sections of the existing guidance in this area. It also eliminates several triggers for derivative accounting, including a requirement to settle certain contracts by delivering registered shares. These changes are intended to make GAAP easier to apply and, therefore, reduce the frequency of errors in this part of the literature. Early adoption is permitted for fiscal years beginning after December 15, 2020. For SEC filers, excluding smaller reporting companies, this Update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, this Update is effective for fiscal years beginning after December 15, 2023, including interim periods therein. The Company is evaluating the impact of this guidance on its consolidated financial statements. |
Restatement of Previously-Issue
Restatement of Previously-Issued Consolidated Financial Statements | 3 Months Ended |
Mar. 31, 2023 | |
Prior Period Adjustment [Abstract] | |
Error Correction [Text Block] | 3. Restatements of Previously-Issued Consolidated Financial Statements During the preparation of its 2022 Annual Report on Form 10-K, the Company determined that it had not appropriately accounted for certain historical transactions under US GAAP. In accordance with Staff Accounting Bulletin (“SAB”) 99, Materiality Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2023 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | 4. Acquisitions On April 1, 2022, the Company acquired Transact Europe Holdings for $28.8 million (€26.0 million) in cash. Transact Europe EAD (TEU), an EU regulated electronic money institution headquartered in Sofia, Bulgaria, offers an array of licenses such as principal level membership of Visa, worldwide membership of MasterCard, and principal membership of China UnionPay. TEU is also part of the direct SEPA (Single Euro Payments Area), a payment system enabling cashless payments across continental Europe. The Company paid $28.8 million as of March 31, 2022, and the transaction closed on April 1, 2022. As a result, the consolidated financial statements as of and for the three months ended March 31, 2022, does not include financial statements of TEU. The $28.8 million paid as of March 31, 2022, is included as prepaid and other current assets in the balance sheets. The following summarizes the estimated fair values of the net assets acquired which is recorded as of April 1, 2022 (dollars in thousands): Tangible assets (liabilities): Net assets and liabilities $ 7,339 Intangible assets: Customer relationships 1,267 Goodwill 20,205 21,472 Total net assets acquired $ 28,811 On March 31, 2022, the Company contracted to acquire a portfolio of merchant accounts from Sky Financial & Intelligence for $18.1 million. The Company paid $16.0 million in cash in March 2022 issued 500,000 shares of restricted common stock for the transaction on May 12, 2022. The entire amount tendered in both cash and stock was recorded as a Customer Relationships asset. However, as of March 31, 2023 and December 31, 2022, the Company had not received delivery of the acquired merchant list and the associated ISO management portal access and as a result the Company charged off the entire purchase price in 2022. Also, during 2022, the Company suspended its reporting of revenue from the Sky Financial portfolio. The Company is vigorously pursuing its entitlements under the purchase agreement. |
Settlement Processing
Settlement Processing | 3 Months Ended |
Mar. 31, 2023 | |
Settlement Processing Abstract | |
Settlement Processing [Text Block] | 5. Settlement Processing The Company’s proprietary blockchain-based technology serves as the settlement engine for all transactions within the Company’s ecosystem. The blockchain ledger provides a robust and secure platform to log immense volumes of immutable transactional records in real time. In summary, blockchain is a distributed ledger that uses digitally encrypted keys to verify, secure and record details of each transaction conducted within an ecosystem. Unlike general blockchain-based systems, The Company uses proprietary, private ledger technology to verify every transaction conducted within the Company ecosystem. The verification of transaction data comes from trusted partners, all of whom have been extensively vetted by us. The Company facilitates all financial elements of our closed-loop ecosystem, and we act as the administrator for all related accounts. Using our TrustGateway technology, we seek authorization and settlement for each transaction from Gateways to the issuing bank responsible for the credit/debit card used in the transaction. When the Gateway settles the transaction, our TrustGateway technology composes a chain of blockchain instructions to our ledger manager system. When consumers use credit or debit cards to pay for transactions with merchants who use our ecosystem, the transaction starts with the consumer purchasing tokens from us. The issuance of tokens is accomplished when we load a virtual wallet with a token, which then transfers credits to the merchant’s wallet on a dollar-for-dollar basis, after which the merchant releases its goods or services to the consumer. These transfers take place instantaneously and seamlessly, allowing the transaction experience to seem like any other ordinary credit or debit card transaction to the consumer and merchant. While our blockchain ledger records transaction details instantaneously, the final cash settlement of each transaction can take days to weeks, depending upon contract terms between us and the gateways we use, between us and our ISOs, and between us and/or our ISOs and merchants who use our services. In the case where we have received transaction funds, but not yet paid a merchant or an ISO, we hold funds in either a trust account or as cash deemed restricted within our operating accounts. We record the total of such funds as Cash Due From Gateways, net – a Current Asset. Of these funds, we record the balance due to Merchants and ISOs as Payment Processing Liabilities, net – a Current Liability. |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | 6. Property and Equipment Property and equipment consisted of the following as of March 31, 2023, and December 31, 2022: March 31, 2023 December 31, 2022 (dollars in thousands) Buildings, machinery and equipment (1) $ 1,360 $ 1,360 Computers 243 231 Furniture and fixtures 153 149 Improvements 164 164 Vehicles, machinery and equipment 15 15 Total property and equipment 1,936 1,920 Less: accumulated depreciation (260 ) (224 ) Net property and equipment $ 1,676 $ 1,696 1. On March 28, 2023, Charge Savvy executed an agreement to sell and subsequently leaseback its property located in South Chicago Heights, Illinois (the “Property”), owned by its subsidiary, Charge Savvy LLC (“CS”). The sales price is updated to $2.5 million with an anticipated closing by July 3, 2023 with a 30-day buyer’s option to extend. The initial term of the leaseback is five (5) years, with an option to terminate early without penalty after conclusion of the second year. Depreciation expense was $36,640 and $32,377 for the three-month periods ended March 31, 2023, and 2022, respectively. |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block Supplement [Abstract] | |
Goodwill Disclosure [Text Block] | 7. Goodwill Goodwill assets consisted of the following, as of March 31, 2023, and December 31, 2022 (dollars in thousands): March 31, 2023 December 31, 2022 Acquisition of Northeast $ 2,793 $ 2,793 Acquisition of Charge Savvy 3,755 3,755 Acquisition of Transact Europe 20,205 20,205 Total goodwill $ 26,753 $ 26,753 |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Disclosure [Text Block] | 8. Intangible Assets Intangible assets consisted of the following, as of March 31, 2023, and December 31, 2022 (dollars in thousands): As of March 31, 2023 As of December 31, 2022 Intangible Assets Amortization Period Cost Accumulated Amortization Net Cost Accumulated Amortization Net Customer relationships - Northeast and Charge Savvy 5 years $ 5,820 $ (2,046 ) $ 3,774 $ 5,820 $ (1,755 ) $ 4,065 Customer relationships - Transact Europe 3 years 1,267 (634 ) 633 1,267 (475 ) 792 Business technology/IP 5 years 2,675 (927 ) 1,748 2,675 (793 ) 1,882 Total intangible assets $ 9,762 $ (3,606 ) $ 6,156 $ 9,762 $ (3,023 ) $ 6,739 Amortization expense was $0.6 million and $0.4 million for the three months ended March 31, 2023 and 2022, respectively. Amortization expense for each of the years ending December 31 is as follows (dollars in thousands): Year Amount 2023 (remainder) $ 1,749 2024 1,857 2025 1,699 2026 847 2027 4 Total $ 6,156 |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | 9. Long-Term Debt Long-term debt consisted of the following, as of March 31, 2023, and December 31, 2022 (dollars in thousands): As of March 31, 2023 As of December 31, 2022 $100,000,000 8% Senior convertible note due November 3, 2024 $ 63,723 $ 61,101 $149,900 Economic Injury Disaster Loan (EIDL), interest rate of 3.75%, due June 1, 2050 149 149 $500,000 EIDL, interest rate of 3.75%, due May 8, 2050 496 499 Total debt 64,368 61,749 Less: current portion (15 ) (14 ) Net long-term debt $ 64,353 $ 61,735 Senior Convertible Notes Balance, December 31, 2020 $ - Convertible debentures issued 100,000 Derivative liability (21,580 ) Original Issue Discount of 16% (16,000 ) Placement fees and issuance costs (7,200 ) Amortization of debt discount 3,435 Balance, December 31, 2021 58,655 Repayments (14,550 ) Amortization of debt discount 16,996 Balance, December 31, 2022 61,101 Amortization of debt discount 2,622 Balance, March 31, 2023 $ 63,723 Derivative liability The Notes contain embedded derivatives representing the conversion features, redemption rights, and certain events of default. The Company determined that these embedded derivatives required bifurcation and separate valuation. The Company utilizes a binomial lattice model to value its bifurcated derivatives included in the Notes. ASC 815 does not permit an issuer to account separately for individual derivative terms and features embedded in hybrid financial instruments that require bifurcation and liability classification as derivative financial instruments. Rather, such terms and features must be combined together, and fair-valued as a single, compound embedded derivative. The Company selected a binomial lattice model to value the compound embedded derivative because it believes this technique is reflective of all significant assumptions that market participants would likely consider in negotiating the transfer of the Notes. Such assumptions include, among other inputs, stock price volatility, risk-free rates, credit risk assumptions, early redemption and conversion assumptions, and the potential for future adjustment of the conversion price due to triggering events. Additionally, there are other embedded features of the Notes requiring bifurcation, other than the conversion features, which had no value at December 31, 2020 due to management’s estimates of the likelihood of certain events, but that may have value in the future should those estimates change. The following is a rollforward of the derivative liability for the year ended December 31, 2022, and the three-month period ended March 31, 2023 (dollars in thousands): Balance, December 1, 2020 $ - Derivative liability on convertible debentures 21,580 Change in fair value 2021 (2,845 ) Balance, December 31, 2021 18,735 Change in fair value 2022 (18,480 ) Balance, December 31, 2022 255 Change in fair value Q1 2023 (placeholder) (168 ) Balance, March 31, 2023 $ 87 The Company sold and issued, in a registered direct offering, an 8% senior convertible note due November 3, 2023, and subsequently extended to November 5, 2024, in the aggregate original principal amount of $100 million (the “Note”). The Note had an original issue discount of sixteen percent (16%) resulting in gross proceeds of $84 million. The Note was sold pursuant to the terms of a Securities Purchase Agreement, dated November 2, 2021 (the “SPA”), between The Company and the investor in the Note (the “Investor”). The Note was issued on November 8, 2021, pursuant to an indenture dated November 2, 2021, between the Company and Wilmington Savings Fund Society, FSB, as trustee (the “Base Indenture”), as supplemented by a first supplemental indenture thereto, dated November 2, 2021, relating to the Notes (the “First Supplemental Indenture” and, the Base Indenture as supplemented by the First Supplemental Indenture, the “First Indenture”). The terms of the Note include those provided in the First Indenture and those made part of the First Indenture by reference to the Trust Indenture Act. Ranking The Note is the senior unsecured obligations of the Company and not the financial obligations of our subsidiaries. Until such date as the principal amount of the Note is $5 million or less, all payments due under the Note will be senior to all other indebtedness of the Company and/or any of our subsidiaries. Maturity Date Unless earlier converted, or redeemed, the Note, as amended, will mature on November 5, 2024, the third anniversary of their issuance date, which we refer to herein as the “Maturity Date”, subject to the right of the investors to extend the date: i. if an event of default under the Note has occurred and is continuing (or any event shall have occurred and be continuing that with the passage of time and the failure to cure would result in an event of default under the Note) and ii. (ii) for a period of 20 business days after the consummation of a fundamental transaction if certain events occur. We are required to pay, on the Maturity Date, all outstanding principal, accrued and unpaid interest and accrued and unpaid late charges on such principal and interest, if any. Interest The Note bears interest at the rate of 8% per annum, and (a) shall commence accruing on the date of issuance, (b) shall be computed on the basis of a 360-day year and twelve 30-day months and (c) shall be payable in cash quarterly in arrears on the first trading day of each calendar quarter or otherwise in accordance with the terms of the Note. If a holder elects to convert or redeem all or any portion of a Note prior to the Maturity Date, all accrued and unpaid interest on the amount being converted or redeemed will also be payable. If we elect to redeem all or any portion of a Note prior to the Maturity Date, all accrued and unpaid interest on the amount being redeemed will also be payable. The interest rate of the Note will automatically increase to 15% per annum upon the occurrence and continuance of an event of default (See “Events of Default” below). Late Charges We are required to pay a late charge of 15% on any amount of principal or other amounts that are not paid when due. Conversion Fixed Conversions at Option of Holder The holder of the Note may convert all, or any part, of the outstanding principal and interest of the Note, at any time at such holder’s option, into shares of our common stock at an initial fixed conversion price, which is subject to: i. proportional adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions; and ii. full-ratchet adjustment in connection a subsequent offering at a per share price less than the fixed conversion price then in effect. On January 28, 2022, we and the Investor, entered into an Agreement and Waiver (the “Waiver”) with regard to the Note that has the following major provisions: a) the Investor agreed to extend the “90 Day Eligibility Date” from February 3, 2022 to May 2, 2022 such that the Investor can no longer, if the closing price of the stock is less than $5.50, convert up to $30 million of the Note into shares of the Company’s common stock (with the conversion price being the lower of (i) the then in effect conversion price and (ii) the greater of (x) the Note’s $1.67 floor price or (y) 98% of the market price on the conversion date) (the “Alternate Optional Conversion Price”) prior to May 2, 2022; b) allows us to acquire, for cancellation, $6 million in in aggregate principal amount of the Note for a purchase price of $6.9 million such that the new principal amount of the Note is $94 million; c) lowers the initial fixed conversion price of the Note from $15 to $12; and d) if the trading volume of our common stock on any individual trading day is over $5 million (the “Alternate Conversion Company Waiver Measuring Date”), allows the Investor an opportunity to convert up to $5 million of the Note into shares of our common stock from the Alternate Conversion Company Waiver Measuring Date through and including 7:00 PM ET on the immediately following trading day. The conversion price would be the lower of (i) the then in effect conversion price and (ii) the greater of (x) the Note’s $1.67 floor price or (y) 98% of the market price on the conversion date. The Company paid the investor $6.0 million, $5.0 million and $3.6 million in principal in the first three quarters of 2022, respectively, consisting of $12.2 million in cash and $2.4 million in interest, consisting of shares of company stock. The foregoing description of the Waiver does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Waiver, executed on January 28, 2022, and reported on Form 8-K on January 31, 2022. 1- Year Alternate Optional Conversion At any time following the first anniversary of the issuance date of the Note, but only if the closing bid price of our common stock on the immediately prior trading day is less than $6.50, each holder of the Note shall have the option to convert, at such holder’s option, pro rata, up to $30 million of the principal amount of the Note (in $250,000 increments) at the Alternate Optional Conversion Price. Alternate Event of Default Optional Conversion If an event of default has occurred under the Note, each holder may alternatively elect to convert the Note (subject to an additional 15% redemption premium) at the “Alternate Event of Default Conversion Price” equal to the lesser of: The fixed conversion price then in effect; and the greater of: i. the floor price; and ii. 80% of the lowest volume weighted average price of our common stock during the five trading days immediately prior to such conversion. Beneficial Ownership Limitation The Note may not be converted and shares of common stock may not be issued under the Note if, after giving effect to the conversion or issuance, the applicable holder of the Note (together with its affiliates, if any) would beneficially own in excess of 4.99% of the Company’s outstanding shares of common stock, which is referred to herein as the “Note Blocker”. The Note Blocker may be raised or lowered to any other percentage not in excess of 9.99% at the option of the applicable holder of Notes, except that any raise will only be effective upon 61-days’ prior notice to us. Change of Control Redemption Right In connection with a change of control of the Company, each holder may require us to redeem in cash all, or any portion, of the Notes at a 15% redemption premium to the greater of the face value, the equity value of our common stock underlying the Notes and the equity value of the change of control consideration payable to the holder of our common stock underlying the Notes. The equity value of our common stock underlying the Notes is calculated using the greatest closing sale price of our common stock during the period immediately preceding the consummation or the public announcement of the change of control and ending the date the holder gives notice of such redemption. The equity value of the change of control consideration payable to the holder of our common stock underlying the Notes is calculated using the aggregate cash consideration per share of our common stock to be paid to the holders of our common stock upon the change of control. Events of Default Under the terms of the first supplemental indenture, the events of default contained in the base indenture shall not apply to the Notes. Rather, the Notes contain standard and customary events of default including but not limited: (i) the suspension from trading or the failure to list our common stock within certain time periods; (ii) failure to make payments when due under the Notes; and (iii) bankruptcy or insolvency of the Company. If an event of default occurs, each holder may require us to redeem all or any portion of the Notes (including all accrued and unpaid interest and late charges thereon), in cash, at a 15% redemption premium to the greater of the face value and the equity value of our common stock underlying the Notes. The equity value of our common stock underlying the Notes is calculated using the greatest closing sale price of our common stock on any trading day immediately preceding such event of default and the date we make the entire payment required. Company Optional Redemption Rights At any time, if no event of default exits, we may redeem all, but not less than all, the Notes outstanding in cash all, or any portion, of the Notes at a 5% redemption premium to the greater of the face value and the equity value of our common stock underlying the Notes. The equity value of the Company’s common stock underlying the Notes is calculated using the greatest closing sale price of our common stock on any trading day during the period commencing on the date immediately preceding such date we notify the applicable holder of such redemption election and the date we make the entire payment required. The foregoing description of the Note does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Note, a copy of which is included hereto as Exhibit 4.3 and incorporated herein by reference. SBA CARES Act Loans - $649,900 On June 9, 2020, the Company entered into a 30-year loan agreement with the SBA under the CARES Act in the amount of $149,900. The loan bears interest at 3.75% per annum and requires monthly principal and interest payments of $731 beginning June 9, 2021. Both the Chief Executive Officer and Chairman of the Company signed personal guarantees under this loan. On May 8, 2020, Charge Savvy executed the standard loan documents required for securing a loan (the “EIDL Loan”) from the SBA under its Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of the COVID-19 pandemic on the TNB’s business. Pursuant to that certain Loan Authorization and Agreement (the “SBA Loan Agreement”), Charge Savvy borrowed an aggregate principal amount of the EIDL Loan of $150,000, with proceeds to be used for working capital purposes. Interest accrues at the rate of 3.75% per annum and will accrue only on funds actually advanced from the date of each advance. Installment payments, including principal and interest, are due monthly beginning May 8, 2021 (twelve months from the date of the SBA Loan) in the amount of $731. The balance of principal and interest is payable thirty years from the date of the SBA Loan. In connection therewith, the Company also received a $10,000 grant, which does not have to be repaid. During the year ended December 31, 2020, $10,000 was recorded in Economy injury disaster loan (EIDL) grant income in the Statements of Operations. On Aug 24, 2021, Charge Savvy was granted an increase in loan principal in the amount of $350,000 on identical terms. In connection therewith, Charge Savvy executed (i) loans for the benefit of the SBA (the “SBA Loan”), which contains customary events of default and (ii) Security Agreements, granting the SBA a security interest in all tangible and intangible personal property of Charge Savvy, which also contains customary events of default (the “SBA Security Agreement”). |
Stock Option Awards
Stock Option Awards | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Payment Arrangement [Text Block] | 10. Stock Option Awards The following table represents the employee stock option activity during the three months ended March 31, 2023 and 2022. Weighted Average Aggregate Shares Exercise Price Intrinsic Value Outstanding at December 31, 2021 391,562 $ 5.08 Granted - - Exercised (13,019 ) 0.42 Forfeited or expired (322 ) 12.10 Outstanding at March 31, 2022 378,221 $ 5.21 $ - Exercisable at March 31, 2022 378,221 $ 5.21 $ - Vested and Expected to Vest at March 31, 2022 378,221 $ 5.21 $ - Outstanding at December 31, 2022 319,627 $ 4.29 Granted - - Exercised - - Forfeited or expired - - Outstanding at March 31, 2023 319,627 $ 4.29 $ - Exercisable at March 31, 2023 319,627 $ 4.29 $ - Vested and Expected to Vest at March 31, 2023 319,627 $ 4.29 $ - The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based upon the Company’s closing stock price of $0.41 and $4.22 as of March 31, 2023, and 2022, respectively, which would have been received by the option holders had all option holders exercised their options as of that date. As of March 31, 2023, there was no unrecognized compensation cost related to non-vested stock options. The Company adopted the 2021 Restricted Stock Plan (“2021 Plan”) in November 2021, which provides for the grant of restricted stock awards and performance stock awards to executive officers, non-employee directors and other key employees of the Company. The 2021 Plan provides for up to 5,000,000 shares of common stock. These awards will have such vesting or other provisions as may be established by the Board of Directors at the time of each award. The following table represents the restricted stock award activity during the three months ended March 31, 2023 and 2022. Non-vested Restricted Stock Awards Weighted Average Grant Date Fair Value Non-vested at January 1, 2022 - Granted 39,413 $ 3.24 Vested (39,413 ) (3.24 ) Forfeited - - Non-vested at March 31, 2022 - - Non-vested at January 1, 2023 667,277 $ 1.20 Granted 13,907 $ 0.63 Vested (315,816 ) (1.29 ) Forfeited - 0 Non-vested at March 31, 2023 365,368 $ 1.02 Total stock-based compensation expense recognized for the Company’s 2021 Plan was $126,414 and $0 for the three months ended March 31, 2023, and 2022, respectively. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Lessor, Operating Leases [Text Block] | 11. Leases On March 23, 2023, the Company executed a lease agreement with for the Company headquarters office commencing July 1, 2023 and terminating on December 31, 2028 with certain contingencies. The leased property is to provide for the continued operations and room for growth at its current location after the expiry of its existing sublease with the sublandlord. The starting monthly rent is $45,593 in July 2023 for the Phase 1 premises. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | 12. Related Party Transactions Kenneth Haller (“Haller”) became the Company’s Senior Vice President of Payment Systems in November 2018. The Company began working indirectly with Haller earlier in 2018, both individually and through our relationship with MTrac Tech Corporation (“MTrac”), which has business relationships with Haller. Haller brings considerable advantages to the Company’s platform development and business development efforts and capabilities, including transactional business relations and a large network of agents (the “Haller Network”). The Haller Network is an amalgamation of the collective networks of Haller and two companies owned or majority-owned by Haller, which are or have been Sky Financial & Intelligence, LLC (“Sky”), and Charge Savvy, LLC (collectively, the “Haller Companies”), each of which has formalized business relationships with the Company, as well as with some of the Company’s partners, which the Company believes allows the Company to maximize and diversity the Company’s market penetration capabilities. Haller, through Sky, owns controlling interests in Charge Savvy, LLC with whom the Company does business through their respective business relationship with MTrac. The following are certain transactions between the Company and the Haller Companies: Sky Financial & Intelligence, LLC – Haller owns 100% of Sky Financial & Intelligence LLC (“Sky”), a Wyoming limited liability company, and serves as its sole Managing Member. Sky is a strategic merchant services company that focuses on high-risk merchants and international credit card processing solutions. In 2018, Sky was using GreenBox’s QuickCard payment system as its main payment processing infrastructure, through Sky’s relationship with MTrac. It was through this successful relationship, that we came to know Haller and the Haller Network. Realizing that the Haller Network and Haller’s unique skill set was highly complementary to our business objectives, we commenced discussions to retain Haller through his consulting firm, Sky, for a senior role, directly responsible for growing GreenBox’s operations. Subsequently, in November 2018, Haller was appointed as our Senior Vice President of Payment Systems, for a monthly consulting fee of $10,000, paid to Sky (“Haller Consulting Fee”). The Company did not pay any commissions to the related parties mentioned above for the years ended December 31, 2022, and 2021. Mr. Haller left the Company in March 2022. Charge Savvy, LLC – Sky owns 68.4% of Charge Savvy, LLC (“Charge Savvy”), an Illinois limited liability company. Haller serves as one of three Managing Members of Charge Savvy, along with Higher Ground Capital, LLC (owns 14%), and Jeff Nickel (owns 17.4%). As a result of the Purchase Agreement, the Company purchased all of Charge Savvy’s issued and outstanding membership interests and Charge Savvy became a wholly owned subsidiary of the Company. The purchase price under the Purchase Agreement for the all-stock transaction consisted of 1,000,000 shares of Common Stock being issued and delivered to the Sellers in proportion to the Sellers’ share of their membership interests in Charge Savvy. The share price at issuance was $12.14. PrivCo The Company repurchased, in two separate repurchase transactions each consisting of 1 million shares of common stock, an aggregate of 2 million shares owned by PrivCo (an entity controlled by Messrs. Errez and Nisan). In October 2022, the Board unanimously ratified these two repurchase transactions between the Company and PrivCo. The Company repurchased 1,000,000 shares for a price per share of $5.59 (for total proceeds to PrivCo of $5.6 million) (the “First Repurchase”) and 1,000,000 shares for a price per share of $0.82 (for total proceeds to PrivCo of $820,000) (the “Second Repurchase”). The First Repurchase was based on the closing price of the common stock on November 24, 2021, and took place over a number of months starting in February 2022 and ending in October 2022. The Second Repurchase was based on the closing price of the common stock on July 29, 2022, and took place in October 2022. The purpose of each of these transactions was to allow the Company to issue shares to new shareholders without increasing the Company’s shares outstanding. Family Relationships The Company employs two of our CEO’s brothers, Dan and Liron Nusonivich, who are paid approximately $200,000 and $110,000 per year, respectively. There are no family relationships between any of the other directors or executive officers and any other employees or directors or executive officers. The Company did not pay any commissions to the related parties mentioned above for the three-month period ended March 31, 2023, March 31, 2022, or the year ended December 31, 2022. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | 13. Commitments and Contingencies From time-to-time, the Company is involved in a number of legal proceedings. The Company records a liability for those legal proceedings when it determines it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. The Company also discloses when it is reasonably possible that a material loss may be incurred however, the amount cannot be reasonably estimated. From time to time, the Company may enter into discussions regarding settlement of these matters, and may enter into settlement agreements, if it believes settlement is in the best interest of the Company and its shareholders. The following is a summary of our current outstanding litigation. Note that references to GreenBox POS are for historical purposes. GreenBox POS changed its name to RYVYL Inc. on October 13, 2022. ● Corporate Performance Consulting, LLC (CPC) v. GreenBox POS – On April 7, 2021, CPC filed a complaint against GreenBox POS in San Diego Superior Court. Plaintiff CPC alleges breach of contract, breach of implied covenant of good faith and fair dealing, goods and services rendered, negligent misrepresentation, violation of CA Business and Professions Code Section 17200, and unjust enrichment. The crux of CPC’s claim is that GreenBox POS failed to compensate for certain consulting and corporate advisory services. GreenBox POS believes the claims are without merit and intends to defend itself vigorously. On June 17, 2021, GreenBox POS filed a Cross-Complaint for breach of contract, breach of implied covenant of good faith and fair dealing, negligent misrepresentation, unjust enrichment, and rescission. The parties attended mediation on December 15, 2022, and subsequently entered into a confidential settlement agreement. The parties have executed a request for dismissal with prejudice to be filed with the Court. ● The Good People Farms, LLC (TGPF) - TGPF initiated an arbitration in AAA on or about April 20, 2020 against GreenBox POS., Fredi Nisan, Ben Errez, MTrac Tech., Vanessa Luna, and Jason LeBlanc. The matter was placed in abeyance for some time. On January 15, 2021 GreenBox POS filed a counter-claim for fraud - intentional misrepresentation, breach of contract, breach of covenant of good faith and fair dealing, violation of California Business and Professions Code Section 17200, and accounting. The arbitration was stayed pending further proceedings in the separate but related action filed by MTrac and Ms. Luna in San Diego Superior Court. The arbitration re-commenced upon the state court's January 14, 2022 order denying MTrac's and Ms. Luna's motion for summary judgment and granting of The Good People Farm's motion to compel arbitration as to MTrac only. TGPF submitted a new statement of claim of June 21, 2022; the individual named as respondents in the original arbitration demand have been removed. The parties attended binding arbitration from April 18 to 21, 2023, and are awaiting the decision of the arbitration panel. ● Pure Health, et al. v. Worldpay LLC et al - On February 18, 2022 forty-three online marketer Plaintiffs filed suit in the Court of Common Pleas, Hamilton County, Ohio against Worldpay LLC (formerly Vantiv LLC), Fifth Third Bank, ChargeSavvy LLC, a wholly owned subsidiary of GreenBox POS, GreenBox POS, and John Does 1 (Defendants) through 10, alleging breach of contract, breach of implied covenant of good faith and fair dealing, conversion, and money had and received (constructive trust). Defendant RYVYL Inc. believes that Plaintiffs’ claims against it are without merit and plans to pursue all judicial remedies necessary to resolve this matter. The parties have settled the matter and executed a request for dismissal with prejudice to be filed with the Court. On April 27, 2022, Paul Levine (“Levine”), former Chief Executive Officer of Coyni, Inc., wholly-owned subsidiary of GreenBox POS, filed a charge with The Occupational Safety and Health Administration (“OSHA”) against respondents Coyni and GreenBox POS. Levine alleges retaliation in violation of the Sarbanes-Oxley Act of 2022, as amended, 18 U.S.C. §1514A (“SOX”). The OSHA claim was withdrawn on or around April 3, 2023. ● On November 8, 2022, RYVYL Inc. filed a complaint against its former COO, Luna Consultant Group, LLC and John Does 1 through 50 in San Diego Superior Court. RYVYL is alleging misappropriation of trade secrets, breach of fiduciary duty, and conversion among other causes of action. The parties are currently in the discovery phase. ● On November 10, 2022, Vanessa Luna, former COO of RYVYL Inc., filed a complaint against RYVYL and Fredi Nisan. Luna alleges breach of contract, unjust enrichment, promissory estoppel, harassment, retaliation and wrongful termination, and fraud among other claims. Luna is seeking damages including compensatory damages, unpaid wages (past and future), loss of wages and benefits (past and future), expectation damages, and other damages to be proven at trial. The Company denies all allegations. Investigation is ongoing. As the Company cannot predict the outcome of the matter the probability of an outcome cannot be determined. The Company intends to vigorously defend against all claims. The parties are currently in the discovery phase. ● On December 12, 2022, Jacqueline Dollar (aka Jacqueline Reynolds), former CMO of RYVYL Inc. filed a complaint against RYVYL Inc. fka Greenbox POS, Inc., Fredi Nisan, and DOES 1-20 alleging sex discrimination in violation of FEHA, failure to prevent discrimination in violation of FEHA, IIED, NIED, and negligent supervision/negligent retention. Ms. Dollar is seeking an unspecified amount of damages related to, among other things, payment of past and future lost wages, stock issuances, bonuses and benefits, compensatory damages, and general, economic, non-economic, and special damages. As the Company cannot predict the outcome of the matter the probability of an outcome cannot be determined. The Company intends to vigorously defend against all claims. ● On February 1, 2023, a purported class action lawsuit titled Cullen V. RYVYL Inc. fka Greenbox POS, Inc., et al., Case No. 3:23-cv-00185-GPC-AGS, was filed in the United States District Court for the Southern District of California against the company and certain of our current and former directors and officers (the “Defendants”). The complaint was filed on behalf of persons who purchased or otherwise acquired the Company’s publicly traded securities between January 29, 2021 and January 20, 2023, (the “Class Action”). The complaint generally alleges that the Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by making false and misleading statements regarding the Company’s financial performance and prospects. The action includes claims for damages, including interest, and an award of reasonable costs and attorneys’ fees and expert fees to the putative class. As the Company cannot predict the outcome of the matter the probability of an outcome cannot be determined. The Company intends to vigorously defend against all claims. This is a summary of our current commitments with respect to pending acquisitions: ● In November 2021, the Company executed a term sheet to acquire certain ACH business of Merchant Payment Solutions LLC. Upon execution of the term sheet, the Company made a refundable earnest money deposit in the amount of $725,000 (the “Deposit”) toward the total purchase price. After conducting due diligence, the Company elected to terminate the term sheet on April 21, 2023, and has requested a refund of the Deposit in full. ● On July 27, 2022, the Company signed a letter of intent to acquire Fundstr UAB for their foreign exchange conversion and international payment capabilities and made a deposit payment of 685,000 euros. As of December 31, 2022, and as of April 17, 2023, the company is conducting acquisition due diligence to meet corporate governance requirements. Sale and Leaseback Agreement On March 28, 2023, the Company’s subsidiary, Charge Savvy, executed an agreement to sell and subsequently leaseback its property located in South Chicago Heights, Illinois (the “Property”), owned by its subsidiary, Charge Savvy LLC (“CS”). The sales price is updated to $2.5 million with an anticipated closing by July 3, 2023 with a 30-day buyer’s option to extend. The initial term of the leaseback is five (5) years, with an option to terminate early without penalty after conclusion of the second year. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | 14. Subsequent Events The Company follows the guidance in FASB ASC Topic 855, Subsequent Events ● On June 30, 2022, RYVYL (EU) EAD entered into a purchase agreement to acquire Roark Holdings, Ltd, a United Kingdom based licensed payment institution, in an all-cash transaction for 1,000,000 pounds, of which 675,000 pounds were paid to the seller and the remaining amount will be due at the change of control. The purchase price was increased to 1,106,000 pounds to provide for the seller’s operating expenses prior to the change of control. Roark Holdings T/A Paysos.com is a respected UK payment institution which allows the licensor to process debit and credit card payments, in addition to local payments within the UK. The Company submitted a request for change of control with the UK Financial Conduct Authority (FCA) but chose to withdraw the change of control application due to unforeseen complication on the part of the Roark Holdings, Ltd in March 2023. The FCA has granted the Company a relief period until December 31, 2023 to maintain compliance status. The Company expects to retrieve the payment already made to the seller and will seek other means to comply with the UK processing regulations. ● RYVYL entered into a Securities Purchase Agreement, dated as of April 6, 2023 (the “Agreement”) with Ang Woon Han, pursuant to which, among other things, the Company purchased 98 million shares of restricted common stock of Logicquest Technology, Inc., a Nevada corporation (“Logicquest”) representing ownership of 97.7% of Logicquest, 48 shares of Series C Convertible Non-Redeemable Preferred Stock of Logicquest and 10 shares of Series D Convertible Non-Redeemable Preferred Stock of Logicquest, in exchange for an aggregate purchase price of $225,000. Logicquest is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) quoted on the OTC Pink Open Market under the symbol “LOGQ” and is required to file reports and other information with the Securities and Exchange Commission (the “SEC”) pursuant to the Exchange Act. The Company is developing plans to merge the assets of Coyni, Inc., a wholly-owned subsidiary of the Company (“Coyni”), and Logicquest, prior to a spin-off. The details of the business combination are being finalized and will be subject to corporate governance. There can be no assurance as to the timing or whether the Company will be able to consummate the spin-off of Logicquest. Since the timing or completion of the transaction is uncertain, the Company’s investment in Coyni has not been reclassified as assets held for sale, in accordance with ASC Topic 205. ● The Company has engaged Kingswood, a division of Kingswood Capital Partners, LLC (“Kingswood”) as the non-exclusive placement agent pursuant to an Engagement Agreement dated as of April 21, 2023, to advise the Company in connection with an offering on a reasonable best-efforts basis of Logicquest as a separate publicly traded company (the “Offering”). The Offering is subject to completion of the intended transfer of Coyni assets to Logicquest and the anticipated spin-off, subject to market conditions. The Company expects to raise approximately $40 million in the Offering based on the valuation of Coyni’s assets and liabilities of approximately $200 million. The Company has not obtained an independent third-party valuation of Coyni. The Company is evaluating additional details regarding the spin-off of Logicquest, and will provide further information when available. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | 15. Segment Reporting The Company has organized its operations into two segments: North America, and International. These segments reflect the way the Company evaluates its business performance and manages its operations. Our chief operating decision maker is our chief executive officer. Management determined the operational data used by the chief operating decision maker is that of the two reportable segments. Management bases strategic goals and decisions on these segments and the data presented below is used to measure financial results. Management evaluates the performance of its segments and allocates resources to them based on operating income or (loss) as compared to prior periods and current performance levels. The reportable segment operational data is presented in the tables below (dollars in thousands): Three Months Ended March 31, 2023 2022 Revenue North America $ 8,804 $ 4,210 International 2,487 - $ 11,291 $ 4,210 As of March 31, 2023 As of December 31, 2022 Long-lived assets, net North America $ 5,472 $ 5,893 International 684 846 $ 6,156 $ 6,739 |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Reclassification, Comparability Adjustment [Policy Text Block] | Reclassifications Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flows. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Cash, Cash Equivalents and Restricted Cash The Company’s cash, cash equivalents and restricted cash represents the following: ● Cash and cash equivalents ● Restricted cash |
Receivable [Policy Text Block] | Cash Due from Gateways and Payment Processing Liabilities The Company’s primary source of revenues consists of payment processing services for its merchant clients. When a merchant makes a sale, the process of receiving the payment card information, engaging the banks for transferring the proceeds to the merchant’s account via digital gateways, and recording the transaction on a blockchain ledger are the activities for which the Company collects fees. In the first quarter of 2023 and the year ended December 31, 2022, the Company utilized several gateways. The gateways have strict guidelines pertaining to scheduling of the release of funds to merchants based on several criteria, such as, among other things, return and chargeback history, associated risks for specific business verticals, and average transaction amounts. To mitigate processing risks, these policies determine reserve requirements and payment-in-arrears strategies. While reserve and payment-in-arrears restrictions are in effect for a merchant payout, the Company records receivables from the gateways against these amounts until released. Cash due from gateways balances presented in the accompanying consolidated balance sheets represent the amount due to the Company for transactions processed wherein the funds have not been distributed. |
Research and Development Expense, Policy [Policy Text Block] | Research and Development Costs Research and development costs, which are expensed as incurred, are primarily comprised of costs and expenses for salaries and benefits of research and development personnel, outsourced contract services, and supplies and materials. |
Revenue [Policy Text Block] | Revenue Recognition Revenue is recognized upon transfer of control of promised goods or services to the Company’s customers or when the Company satisfies any performance obligations under contract. The amount of revenue represents consideration the Company expects to be entitled to in exchange for the respective goods or services provided. Under Accounting Standards Codification 606, “ Revenue from Contracts with Customers The Company’s primary revenue source is generated from payment processing services. Payment processing services revenue is based on a percentage of each transaction’s value and/or upon fixed amounts specified per each transaction or service and is recognized as such transactions or services are performed, at a point in time. |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | Accounts Receivable and Allowance for Credit Losses The Company maintains an allowance for credit losses for estimated losses from the inability of gateways to make required payments. The allowance for credit losses is evaluated periodically based on the aging of accounts receivable, the operational relationship with gateways and their payment history, historical charge-off experience and other assumptions, such as current assessment of economic conditions. |
Prepaid Expenses, Policy [Policy Text Block] | Prepaid Expenses Prepaid expenses primarily consist of deposits made with credit card companies under Transact Europe Holdings OOD and the prepayment associated with other acquisitions. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment are stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the assets, which range from three to eight years. Leasehold improvements are amortized over the shorter of the useful life of the related assets or the lease term. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is recognized in the period the transaction occurs. |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company assesses the fair value of financial instruments based on the provisions of ASC 820, Fair Value Measurements ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1- Quoted prices in active markets for identical assets or liabilities. Level 2- Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3- Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table describes the valuation techniques used to calculate the fair value for assets in Level 3. The significant unobservable input used in the fair value measurement of the Company’s identifiable intangible assets is the discount rate. The change in this input could result in a change of fair value measurement (dollars in thousands): Fair Value at March 31, 2023 Customer relationships $ 4,407 Business intellectual properties 1,748 Derivative Liability 87 Fair Value at December 31, 2022 Customer relationships $ 4,857 Business intellectual properties 1,882 Derivative liability 255 |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill and Other Intangible Assets The Company accounts for acquisitions of businesses in accordance with the acquisition method of accounting which requires assets and liabilities to be recognized at their fair values on the acquisition date. Goodwill represents the excess of the purchase price of acquired businesses over the fair value of the identifiable assets acquired and liabilities assumed. Acquisition costs are expensed as incurred. Goodwill and other intangible assets acquired in a business combination determined to have an indefinite useful life are generally not amortized, but instead are tested for impairment at least annually and more frequently if events and circumstances indicate that the asset might be impaired. An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value. Other intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Impairment of Long-Lived Assets Long-lived assets are reviewed for impairment whenever management believes that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. To the extent that the carrying value is determined to be unrecoverable, an impairment loss is recognized through a charge to expense. As of December 31, 2022, other than a charge off of the entire consideration paid in connection with the contracted acquisition of the Sky Financial portfolio, the Company performed an impairment analysis on the other acquired goodwill and other long-lived assets and concluded that their values are supportable and recoverable. |
Income Tax, Policy [Policy Text Block] | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, net of operating loss carry forwards and credits, by applying enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all the deferred tax assets will not be realized. Judgment is required in determining and evaluating income tax provisions and valuation allowances for deferred income tax assets. We recognize an income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. As of March 31, 2023, and December 31, 2022, we have valuation allowances which serve to reduce net deferred tax assets. |
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Share Basic earnings per share is computed by dividing net income to common stockholders by the weighted average number of shares outstanding for the periods presented. Dilutive earnings per share includes the effect of any potentially dilutive debt or equity under the treasury stock method, if including such instruments is dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the years ended December 31, 2022, and three-month periods ended March 31, 2023, and 2022, since there are no potential shares outstanding that would have a dilutive effect. |
Lessee, Leases [Policy Text Block] | Leases On February 25, 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. ASC 842 requires that lessees recognize right of use assets and lease liabilities calculated based on the net present value of lease payments for all lease agreements with terms that are greater than twelve months. ASC 842 distinguishes leases as either a finance lease or an operating lease that affects how the leases are measured and presented in the statements of operations and statements of changes in cash flows. ASC 842 supersedes nearly all existing lease accounting guidance under GAAP issued by the Financial Accounting Standards Board (“FASB”) including ASC Topic 840, Leases. For operating leases, we calculated right of use assets and lease liabilities based on the net present value of the remaining lease payments as of the adoption date using our incremental borrowing rate as of that date. |
Segment Reporting, Policy [Policy Text Block] | Segment Reporting The Company has organized its operations into two segments: North America and International. These segments reflect the way management evaluates its business performance and manages its operations. Our chief operating decision maker is our chief executive officer. Management has determined that the operational data used by our chief operating decision maker is that of the two reportable segments. Management bases strategic goals and decisions on these segments. Management evaluates the performance of its segments and allocates resources based on operating income or (loss) as compared to prior periods and current performance levels. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Standard Adopted In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses”. The standard, including subsequently issued amendments (ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-10 and ASU 2019-11), requires a financial asset measured at amortized cost basis, such as accounts receivable and certain other financial assets, to be presented at the net amount expected to be collected based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. In November 2019, the FASB issued ASU No. 2019-10 to postpone the effective date of ASU No. 2016-13 for public business entities eligible to be smaller reporting companies defined by the SEC to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company has adopted this accounting standard, effective January 1, 2023. Management assessed the adoption of this standard on the effective date and concluded that the adoption did not have a material effect on our consolidated financial condition, results of operations, and cash flows during the period ended March 31, 2023. Recent Accounting Standards and Guidance Not Adopted In October 2021, the FASB issued ASU 2021-08, “ Business Combinations Accounting for Contract Assets and Contract Liabilities from Contracts with Customers Revenue from Contracts with Customers The FASB issued ASU 2020-06 (“Update”) to simplify the accounting for convertible instruments by eliminating large sections of the existing guidance in this area. It also eliminates several triggers for derivative accounting, including a requirement to settle certain contracts by delivering registered shares. These changes are intended to make GAAP easier to apply and, therefore, reduce the frequency of errors in this part of the literature. Early adoption is permitted for fiscal years beginning after December 15, 2020. For SEC filers, excluding smaller reporting companies, this Update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, this Update is effective for fiscal years beginning after December 15, 2023, including interim periods therein. The Company is evaluating the impact of this guidance on its consolidated financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The following table describes the valuation techniques used to calculate the fair value for assets in Level 3. The significant unobservable input used in the fair value measurement of the Company’s identifiable intangible assets is the discount rate. The change in this input could result in a change of fair value measurement (dollars in thousands): Fair Value at March 31, 2023 Customer relationships $ 4,407 Business intellectual properties 1,748 Derivative Liability 87 Fair Value at December 31, 2022 Customer relationships $ 4,857 Business intellectual properties 1,882 Derivative liability 255 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Northeast Merchant Systems, Inc. (“Northeast”) [Member] | |
Acquisitions (Tables) [Line Items] | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | The following summarizes the estimated fair values of the net assets acquired which is recorded as of April 1, 2022 (dollars in thousands): Tangible assets (liabilities): Net assets and liabilities $ 7,339 Intangible assets: Customer relationships 1,267 Goodwill 20,205 21,472 Total net assets acquired $ 28,811 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment consisted of the following as of March 31, 2023, and December 31, 2022: March 31, 2023 December 31, 2022 (dollars in thousands) Buildings, machinery and equipment (1) $ 1,360 $ 1,360 Computers 243 231 Furniture and fixtures 153 149 Improvements 164 164 Vehicles, machinery and equipment 15 15 Total property and equipment 1,936 1,920 Less: accumulated depreciation (260 ) (224 ) Net property and equipment $ 1,676 $ 1,696 1. On March 28, 2023, Charge Savvy executed an agreement to sell and subsequently leaseback its property located in South Chicago Heights, Illinois (the “Property”), owned by its subsidiary, Charge Savvy LLC (“CS”). The sales price is updated to $2.5 million with an anticipated closing by July 3, 2023 with a 30-day buyer’s option to extend. The initial term of the leaseback is five (5) years, with an option to terminate early without penalty after conclusion of the second year. |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block Supplement [Abstract] | |
Schedule of Goodwill [Table Text Block] | Goodwill assets consisted of the following, as of March 31, 2023, and December 31, 2022 (dollars in thousands): March 31, 2023 December 31, 2022 Acquisition of Northeast $ 2,793 $ 2,793 Acquisition of Charge Savvy 3,755 3,755 Acquisition of Transact Europe 20,205 20,205 Total goodwill $ 26,753 $ 26,753 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Intangible assets consisted of the following, as of March 31, 2023, and December 31, 2022 (dollars in thousands): As of March 31, 2023 As of December 31, 2022 Intangible Assets Amortization Period Cost Accumulated Amortization Net Cost Accumulated Amortization Net Customer relationships - Northeast and Charge Savvy 5 years $ 5,820 $ (2,046 ) $ 3,774 $ 5,820 $ (1,755 ) $ 4,065 Customer relationships - Transact Europe 3 years 1,267 (634 ) 633 1,267 (475 ) 792 Business technology/IP 5 years 2,675 (927 ) 1,748 2,675 (793 ) 1,882 Total intangible assets $ 9,762 $ (3,606 ) $ 6,156 $ 9,762 $ (3,023 ) $ 6,739 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Amortization expense for each of the years ending December 31 is as follows (dollars in thousands): Year Amount 2023 (remainder) $ 1,749 2024 1,857 2025 1,699 2026 847 2027 4 Total $ 6,156 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | Long-term debt consisted of the following, as of March 31, 2023, and December 31, 2022 (dollars in thousands): As of March 31, 2023 As of December 31, 2022 $100,000,000 8% Senior convertible note due November 3, 2024 $ 63,723 $ 61,101 $149,900 Economic Injury Disaster Loan (EIDL), interest rate of 3.75%, due June 1, 2050 149 149 $500,000 EIDL, interest rate of 3.75%, due May 8, 2050 496 499 Total debt 64,368 61,749 Less: current portion (15 ) (14 ) Net long-term debt $ 64,353 $ 61,735 |
Convertible Debt [Table Text Block] | Balance, December 31, 2020 $ - Convertible debentures issued 100,000 Derivative liability (21,580 ) Original Issue Discount of 16% (16,000 ) Placement fees and issuance costs (7,200 ) Amortization of debt discount 3,435 Balance, December 31, 2021 58,655 Repayments (14,550 ) Amortization of debt discount 16,996 Balance, December 31, 2022 61,101 Amortization of debt discount 2,622 Balance, March 31, 2023 $ 63,723 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The following is a rollforward of the derivative liability for the year ended December 31, 2022, and the three-month period ended March 31, 2023 (dollars in thousands): Balance, December 1, 2020 $ - Derivative liability on convertible debentures 21,580 Change in fair value 2021 (2,845 ) Balance, December 31, 2021 18,735 Change in fair value 2022 (18,480 ) Balance, December 31, 2022 255 Change in fair value Q1 2023 (placeholder) (168 ) Balance, March 31, 2023 $ 87 |
Stock Option Awards (Tables)
Stock Option Awards (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Payment Arrangement, Option, Activity [Table Text Block] | The following table represents the employee stock option activity during the three months ended March 31, 2023 and 2022. Weighted Average Aggregate Shares Exercise Price Intrinsic Value Outstanding at December 31, 2021 391,562 $ 5.08 Granted - - Exercised (13,019 ) 0.42 Forfeited or expired (322 ) 12.10 Outstanding at March 31, 2022 378,221 $ 5.21 $ - Exercisable at March 31, 2022 378,221 $ 5.21 $ - Vested and Expected to Vest at March 31, 2022 378,221 $ 5.21 $ - Outstanding at December 31, 2022 319,627 $ 4.29 Granted - - Exercised - - Forfeited or expired - - Outstanding at March 31, 2023 319,627 $ 4.29 $ - Exercisable at March 31, 2023 319,627 $ 4.29 $ - Vested and Expected to Vest at March 31, 2023 319,627 $ 4.29 $ - |
Nonvested Restricted Stock Shares Activity [Table Text Block] | The following table represents the restricted stock award activity during the three months ended March 31, 2023 and 2022. Non-vested Restricted Stock Awards Weighted Average Grant Date Fair Value Non-vested at January 1, 2022 - Granted 39,413 $ 3.24 Vested (39,413 ) (3.24 ) Forfeited - - Non-vested at March 31, 2022 - - Non-vested at January 1, 2023 667,277 $ 1.20 Granted 13,907 $ 0.63 Vested (315,816 ) (1.29 ) Forfeited - 0 Non-vested at March 31, 2023 365,368 $ 1.02 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] | Three Months Ended March 31, 2023 2022 Revenue North America $ 8,804 $ 4,210 International 2,487 - $ 11,291 $ 4,210 |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | As of March 31, 2023 As of December 31, 2022 Long-lived assets, net North America $ 5,472 $ 5,893 International 684 846 $ 6,156 $ 6,739 |
Description of the Business a_2
Description of the Business and Basis of Presentation (Details) $ / shares in Units, $ in Thousands, € in Millions | 1 Months Ended | 3 Months Ended | ||||||||
Mar. 28, 2023 USD ($) | Jun. 30, 2022 GBP (£) | Apr. 01, 2022 USD ($) | Apr. 01, 2022 EUR (€) | Mar. 31, 2022 USD ($) shares | Jul. 13, 2021 ft² $ / shares shares | Mar. 31, 2023 GBP (£) | Mar. 31, 2023 USD ($) $ / shares | Mar. 31, 2022 USD ($) | Dec. 31, 2022 $ / shares | |
Description of the Business and Basis of Presentation (Details) [Line Items] | ||||||||||
Common Stock, Par or Stated Value Per Share (in Dollars per share) | $ 0.001 | $ 0.001 | ||||||||
Business Combination, Consideration Transferred | $ 2,500 | £ 1,000,000 | $ 18,100 | £ 1,106,000 | ||||||
Payments to Acquire Businesses, Gross | $ 28,800 | € 26 | $ 16,000 | $ 0 | $ 28,811 | |||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 500,000 | |||||||||
Charge Savvy LLC [Member] | ||||||||||
Description of the Business and Basis of Presentation (Details) [Line Items] | ||||||||||
Stock Issued During Period, Shares, Acquisitions (in Shares) | shares | 1,000,000 | |||||||||
Common Stock, Par or Stated Value Per Share (in Dollars per share) | $ 0.001 | |||||||||
Shares Issued, Price Per Share (in Dollars per share) | $ 12.14 | |||||||||
Area of Real Estate Property (in Square Feet) | ft² | 64,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | Mar. 31, 2023 |
Minimum [Member] | |
Summary of Significant Accounting Policies (Details) [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Maximum [Member] | |
Summary of Significant Accounting Policies (Details) [Line Items] | |
Property, Plant and Equipment, Useful Life | 8 years |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fair Value | $ 87 | $ 255 |
Customer Relationships [Member] | ||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fair Value | 4,407 | 4,857 |
Technology-Based Intangible Assets [Member] | ||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Fair Value | $ 1,748 | $ 1,882 |
Acquisitions (Details)
Acquisitions (Details) € in Millions | Apr. 01, 2022 USD ($) | Apr. 01, 2022 EUR (€) | Mar. 31, 2022 USD ($) shares |
Transact Europe Holdings [Member] | |||
Acquisitions (Details) [Line Items] | |||
Payments to Acquire Businesses, Gross | $ 28,800,000 | € 26 | $ 28.8 |
Sky Financial & Intelligence [Member] | |||
Acquisitions (Details) [Line Items] | |||
Payments to Acquire Businesses, Gross | 16 | ||
Business Combination, Consideration Transferred | $ 18.1 | ||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 500,000 |
Acquisitions (Details) - Schedu
Acquisitions (Details) - Schedule of Business Acquisitions, by Acquisition - Transact Europe Holdings [Member] | Apr. 01, 2022 USD ($) |
Tangible assets (liabilities): | |
Net assets and liabilities | $ 7,339 |
Intangible assets: | |
Intangible assets | 21,472 |
Total net assets acquired | 28,811 |
Goodwill [Member] | |
Intangible assets: | |
Intangible assets | 20,205 |
Customer Relationships [Member] | |
Intangible assets: | |
Intangible assets | $ 1,267 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 36,640 | $ 32,377 |
Property and Equipment (Detai_2
Property and Equipment (Details) - Property, Plant and Equipment - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment | $ 1,936 | $ 1,920 | |
Less: accumulated depreciation | (260) | (224) | |
Net property and equipment | 1,676 | 1,696 | |
Building and Building Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | [1] | 1,360 | 1,360 |
Computer Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 243 | 231 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 153 | 149 | |
Building Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 164 | 164 | |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | $ 15 | $ 15 | |
[1]On March 28, 2023, Charge Savvy executed an agreement to sell and subsequently leaseback its property located in South Chicago Heights, Illinois (the “Property”), owned by its subsidiary, Charge Savvy LLC (“CS”). The sales price is updated to $2.5 million with an anticipated closing by July 3, 2023 with a 30-day buyer’s option to extend. The initial term of the leaseback is five (5) years, with an option to terminate early without penalty after conclusion of the second year. |
Goodwill (Details) - Schedule o
Goodwill (Details) - Schedule of Goodwill - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Goodwill [Line Items] | ||
Goodwill | $ 26,753 | $ 26,753 |
Northeast Merchant Systems, Inc. (“Northeast”) [Member] | ||
Goodwill [Line Items] | ||
Goodwill | 2,793 | 2,793 |
Charge Savvy LLC [Member] | ||
Goodwill [Line Items] | ||
Goodwill | 3,755 | 3,755 |
Transact Europe Holdings [Member] | ||
Goodwill [Line Items] | ||
Goodwill | $ 20,205 | $ 20,205 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of Intangible Assets | $ 0.6 | $ 0.4 |
Intangible Assets (Details) - S
Intangible Assets (Details) - Schedule of Finite-Lived Intangible Assets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 9,762 | $ 9,762 |
Accumulated Amortization | (3,606) | (3,023) |
Net | $ 6,156 | 6,739 |
Technology-Based Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 5 years | |
Cost | $ 2,675 | 2,675 |
Accumulated Amortization | (927) | (793) |
Net | $ 1,748 | 1,882 |
Northeast and Charge Savvy [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 5 years | |
Cost | $ 5,820 | 5,820 |
Accumulated Amortization | (2,046) | (1,755) |
Net | $ 3,774 | 4,065 |
Transact Europe Holdings [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 3 years | |
Cost | $ 1,267 | 1,267 |
Accumulated Amortization | (634) | (475) |
Net | $ 633 | $ 792 |
Intangible Assets (Details) -_2
Intangible Assets (Details) - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Schedule Of Finite Lived Intangible Assets Future Amortization Expense Abstract | ||
2023 | $ 1,749 | |
2024 | 1,857 | |
2025 | 1,699 | |
2026 | 847 | |
2027 | 4 | |
Total | $ 6,156 | $ 6,739 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) | 2 Months Ended | 3 Months Ended | 12 Months Ended | |||||
Jan. 28, 2022 | Nov. 02, 2021 | Jun. 09, 2020 | May 08, 2020 | Mar. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2022 | |
Senior Convertible Debt ]Member] | ||||||||
Long-Term Debt (Details) [Line Items] | ||||||||
Debt Instrument, Face Amount | $ 100,000,000 | $ 100,000,000 | ||||||
Debt, Original Issue Discount Rate | 16% | |||||||
Proceeds from Debt, Net of Issuance Costs | $ 84,000,000 | |||||||
Debt Instrument, Description | Until such date as the principal amount of the Note is $5 million or less, all payments due under the Note will be senior to all other indebtedness of the Company and/or any of our subsidiaries. | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 8% | 8% | ||||||
Debt, Default Interest Rate | 15% | |||||||
Debt, Late Charge, Percentage | 15% | |||||||
Debt, Amendment Description | On January 28, 2022, we and the Investor, entered into an Agreement and Waiver (the “Waiver”) with regard to the Note that has the following major provisions: a) the Investor agreed to extend the “90 Day Eligibility Date” from February 3, 2022 to May 2, 2022 such that the Investor can no longer, if the closing price of the stock is less than $5.50, convert up to $30 million of the Note into shares of the Company’s common stock (with the conversion price being the lower of (i) the then in effect conversion price and (ii) the greater of (x) the Note’s $1.67 floor price or (y) 98% of the market price on the conversion date) (the “Alternate Optional Conversion Price”) prior to May 2, 2022; b) allows us to acquire, for cancellation, $6 million in in aggregate principal amount of the Note for a purchase price of $6.9 million such that the new principal amount of the Note is $94 million; c) lowers the initial fixed conversion price of the Note from $15 to $12; and d) if the trading volume of our common stock on any individual trading day is over $5 million (the “Alternate Conversion Company Waiver Measuring Date”), allows the Investor an opportunity to convert up to $5 million of the Note into shares of our common stock from the Alternate Conversion Company Waiver Measuring Date through and including 7:00 PM ET on the immediately following trading day. The conversion price would be the lower of (i) the then in effect conversion price and (ii) the greater of (x) the Note’s $1.67 floor price or (y) 98% of the market price on the conversion date. | |||||||
Repayments of Debt | $ 6,000,000 | $ 3,600,000 | $ 5,000,000 | |||||
Debt Instrument, Convertible, Terms of Conversion Feature | At any time following the first anniversary of the issuance date of the Note, but only if the closing bid price of our common stock on the immediately prior trading day is less than $6.50, each holder of the Note shall have the option to convert, at such holder’s option, pro rata, up to $30 million of the principal amount of the Note (in $250,000 increments) at the Alternate Optional Conversion Price. | |||||||
Debt Instrument, Debt Default, Description of Violation or Event of Default | If an event of default has occurred under the Note, each holder may alternatively elect to convert the Note (subject to an additional 15% redemption premium) at the “Alternate Event of Default Conversion Price” equal to the lesser of: The fixed conversion price then in effect; and the greater of: i. the floor price; and ii. 80% of the lowest volume weighted average price of our common stock during the five trading days immediately prior to such conversion. | |||||||
Debt Instrument, Redemption Price, Percentage | 15% | |||||||
Debt, Ownership Limitations | The Note may not be converted and shares of common stock may not be issued under the Note if, after giving effect to the conversion or issuance, the applicable holder of the Note (together with its affiliates, if any) would beneficially own in excess of 4.99% of the Company’s outstanding shares of common stock, which is referred to herein as the “Note Blocker”. The Note Blocker may be raised or lowered to any other percentage not in excess of 9.99% at the option of the applicable holder of Notes, except that any raise will only be effective upon 61-days’ prior notice to us. | |||||||
Debt Instrument, Redemption, Description | At any time, if no event of default exits, we may redeem all, but not less than all, the Notes outstanding in cash all, or any portion, of the Notes at a 5% redemption premium to the greater of the face value and the equity value of our common stock underlying the Notes | |||||||
SBA CARES Act Loan [Member] | ||||||||
Long-Term Debt (Details) [Line Items] | ||||||||
Debt Instrument, Face Amount | $ 149,900 | $ 149,900 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.75% | 3.75% | ||||||
Debt Instrument, Term | 30 years | |||||||
Debt Instrument, Periodic Payment | $ 731 | |||||||
Economic Injury Disaster Loan (“EIDL”) [Member] | ||||||||
Long-Term Debt (Details) [Line Items] | ||||||||
Debt Instrument, Face Amount | $ 150,000 | $ 500,000 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.75% | 3.75% | ||||||
Debt Instrument, Periodic Payment | $ 731 | |||||||
Proceeds from Other Debt | 10,000 | |||||||
Other Nonrecurring Income | 10,000 | |||||||
Debt Instrument, Increase (Decrease), Net | $ 350,000 | |||||||
Principal [Member] | Senior Convertible Debt ]Member] | ||||||||
Long-Term Debt (Details) [Line Items] | ||||||||
Repayments of Debt | $ 12,200,000 | |||||||
Interest Expense [Member] | Senior Convertible Debt ]Member] | ||||||||
Long-Term Debt (Details) [Line Items] | ||||||||
Repayments of Debt | $ 2,400,000 |
Long-Term Debt (Details) - Sche
Long-Term Debt (Details) - Schedule of Debt - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Long-Term Debt (Details) - Schedule of Debt [Line Items] | ||||
Total debt | $ 64,368 | $ 61,749 | ||
Current portion | (15) | (14) | ||
Net long term debt | 64,353 | 61,735 | ||
Senior Convertible Debt ]Member] | ||||
Long-Term Debt (Details) - Schedule of Debt [Line Items] | ||||
Convertible notes payable | 63,723 | 61,101 | $ 58,655 | $ 0 |
SBA CARES Act Loan [Member] | ||||
Long-Term Debt (Details) - Schedule of Debt [Line Items] | ||||
Loan | 149 | 149 | ||
Economic Injury Disaster Loan (“EIDL”) [Member] | ||||
Long-Term Debt (Details) - Schedule of Debt [Line Items] | ||||
Loan | $ 496 | $ 499 |
Long-Term Debt (Details) - Sc_2
Long-Term Debt (Details) - Schedule of Debt (Parentheticals) - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Nov. 02, 2021 | Jun. 09, 2020 | May 08, 2020 | |
Senior Convertible Debt ]Member] | ||||
Long-Term Debt (Details) - Schedule of Debt (Parentheticals) [Line Items] | ||||
Principal | $ 100,000,000 | $ 100,000,000 | ||
Interest rate | 8% | 8% | ||
Due | Nov. 03, 2024 | |||
SBA CARES Act Loan [Member] | ||||
Long-Term Debt (Details) - Schedule of Debt (Parentheticals) [Line Items] | ||||
Principal | $ 149,900 | $ 149,900 | ||
Interest rate | 3.75% | 3.75% | ||
Due | Jun. 01, 2050 | |||
Economic Injury Disaster Loan (“EIDL”) [Member] | ||||
Long-Term Debt (Details) - Schedule of Debt (Parentheticals) [Line Items] | ||||
Principal | $ 500,000 | $ 150,000 | ||
Interest rate | 3.75% | 3.75% | ||
Due | May 08, 2050 |
Long-Term Debt (Details) - Conv
Long-Term Debt (Details) - Convertible Debt - Senior Convertible Debt ]Member] - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Long-Term Debt (Details) - Convertible Debt [Line Items] | |||
Balance | $ 61,101 | $ 58,655 | $ 0 |
Repayments | (14,550) | ||
Convertible debentures issued | 100,000 | ||
Derivative liability | (21,580) | ||
Original Issue Discount of 16% | (16,000) | ||
Placement fees and issuance costs | (7,200) | ||
Accretion expense | 2,622 | 16,996 | 3,435 |
Balance | $ 63,723 | $ 61,101 | $ 58,655 |
Long-Term Debt (Details) - Fair
Long-Term Debt (Details) - Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation Abstract | |||
Balance | $ 255 | $ 18,735 | $ 0 |
Derivative liability on convertible debentures | 21,580 | ||
Change in fair value | (168) | (18,480) | (2,845) |
Balance | $ 87 | $ 255 | $ 18,735 |
Stock Option Awards (Details)
Stock Option Awards (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock Option Awards (Details) [Line Items] | ||
Share Price | $ 0.41 | |
Share-Based Payment Arrangement, Expense | $ 193,000 | $ 293,000 |
Share-Based Payment Arrangement, Option [Member] | ||
Stock Option Awards (Details) [Line Items] | ||
Share Price | $ 4.22 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | 5,000,000 | |
Share-Based Payment Arrangement, Expense | $ 0 | $ 126,414 |
Stock Option Awards (Details) -
Stock Option Awards (Details) - Share-based Payment Arrangement, Option, Activity - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share Based Payment Arrangement Option Activity Abstract | ||
Outstanding, Shares | 319,627 | 391,562 |
Outstanding, Weighted- Average Exercise Price | $ 4.29 | $ 5.08 |
Granted, Shares | 0 | 0 |
Granted, Weighted- Average Exercise Price | $ 0 | $ 0 |
Exercise, Shares | 0 | (13,019) |
Exercised, Weighted- Average Exercise Price | $ 0 | $ 0.42 |
Forfeited or Expired, Shares | 0 | (322) |
Forfeited or Expired, Weighted- Average Exercise Price | $ 0 | $ 12.1 |
Outstanding, Shares | 319,627 | 378,221 |
Outstanding, Weighted- Average Exercise Price | $ 4.29 | $ 5.21 |
Aggregate Intrinsic Value | $ 0 | |
Exercisable, Shares | 319,627 | 378,221 |
Exercisable, Weighted- Average Exercise Price | $ 4.29 | $ 5.21 |
Vested and Expected to Vest, Shares | 319,627 | 378,221 |
Vested and Expected to Vest, Weighted- Average Exercise Price | $ 4.29 | $ 5.21 |
Stock Option Awards (Details)_2
Stock Option Awards (Details) - Nonvested Restricted Stock Shares Activity - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2021 | |
Nonvested Restricted Stock Shares Activity Abstract | ||
Non-vested Restricted Stock Awards | 667,277 | |
Non-vested Restricted Stock Awards, Weighted Average Grant Date Fair Value | $ 1.2 | |
Granted | 13,907 | 39,413 |
Granted, Weighted Average Grant Date Fair Value | $ 0.63 | $ 3.24 |
Vested | (315,816) | (39,413) |
Vested, Weighted Average Grant Date Fair Value | $ (1.29) | $ (3.24) |
Forfeited | 0 | 0 |
Forfeited, Weighted Average Grant Date Fair Value | $ 0 | $ 0 |
Non-vested Restricted Stock Awards | 365,368 | 0 |
Non-vested Restricted Stock Awards, Weighted Average Grant Date Fair Value | $ 1.02 | $ 0 |
Leases (Details)
Leases (Details) | Jul. 01, 2023 USD ($) |
Disclosure Text Block [Abstract] | |
Operating Lease, Expense | $ 45,593 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Oct. 31, 2022 | Jul. 13, 2021 | Oct. 31, 2022 | Nov. 30, 2018 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2018 | |
Related Party Transactions (Details) [Line Items] | |||||||
Stock Repurchased During Period, Shares (in Shares) | 2,000,000 | ||||||
Share Price (in Dollars per share) | $ 0.41 | ||||||
Payments for Repurchase of Equity | $ 0 | $ 3,540,000 | |||||
Charge Savvy [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Equity Method Investment, Ownership Percentage | 100% | ||||||
Related Party Transaction, Description of Transaction | Sky owns 68.4% of Charge Savvy, LLC (“Charge Savvy”), an Illinois limited liability company. Haller serves as one of three Managing Members of Charge Savvy, along with Higher Ground Capital, LLC (owns 14%), and Jeff Nickel (owns 17.4%). | ||||||
Stock Issued During Period, Shares, Acquisitions (in Shares) | 1,000,000 | ||||||
Shares Issued, Price Per Share (in Dollars per share) | $ 12.14 | ||||||
Monthly Consulting Fee [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Related Party Transaction, Amounts of Transaction | $ 10,000 | ||||||
Family of CEO #1 [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Salary and Wage, NonOfficer, Excluding Cost of Good and Service Sold | 200,000 | ||||||
Family of CEO #2 [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Salary and Wage, NonOfficer, Excluding Cost of Good and Service Sold | $ 110,000 | ||||||
First Repurchase [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Stock Repurchased During Period, Shares (in Shares) | 1,000,000 | ||||||
Share Price (in Dollars per share) | $ 5.59 | $ 5.59 | |||||
Payments for Repurchase of Equity | $ 5,600,000 | ||||||
Second Repurchase [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Stock Repurchased During Period, Shares (in Shares) | 1,000,000 | ||||||
Share Price (in Dollars per share) | $ 0.82 | $ 0.82 | |||||
Payments for Repurchase of Equity | $ 820,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 1 Months Ended | ||||||
Mar. 28, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2022 GBP (£) | Mar. 31, 2022 USD ($) | Mar. 31, 2023 GBP (£) | Nov. 30, 2021 USD ($) | Jul. 27, 2022 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |||||||
Other Payments to Acquire Businesses | $ 675,000 | $ 725,000 | |||||
Deposits | $ 685,000 | ||||||
Business Combination, Consideration Transferred | $ 2,500,000 | £ 1,000,000 | $ 18,100,000 | £ 1,106,000 |
Subsequent Events (Details)
Subsequent Events (Details) | 1 Months Ended | |||||||
Apr. 21, 2023 USD ($) | Apr. 06, 2023 USD ($) shares | Mar. 28, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2022 GBP (£) | Mar. 31, 2022 USD ($) shares | Mar. 31, 2023 GBP (£) | Nov. 30, 2021 USD ($) | |
Subsequent Events (Details) [Line Items] | ||||||||
Business Combination, Consideration Transferred | $ 2,500,000 | £ 1,000,000 | $ 18,100,000 | £ 1,106,000 | ||||
Other Payments to Acquire Businesses | $ | $ 675,000 | $ 725,000 | ||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 500,000 | |||||||
Subsequent Event [Member] | ||||||||
Subsequent Events (Details) [Line Items] | ||||||||
Business Combination, Consideration Transferred | $ | $ 225,000 | |||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 98,000,000 | |||||||
Equity Method Investment, Ownership Percentage | 97.70% | |||||||
Offering, Value | $ | $ 40,000,000 | |||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ | $ 200,000,000 | |||||||
Series C Preferred Stock [Member] | Subsequent Event [Member] | ||||||||
Subsequent Events (Details) [Line Items] | ||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 48 | |||||||
Series D Preferred Stock [Member] | Subsequent Event [Member] | ||||||||
Subsequent Events (Details) [Line Items] | ||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 10 |
Segment Reporting (Details)
Segment Reporting (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Number of Operating Segments | 2 |
Number of Reportable Segments | 2 |
Segment Reporting (Details) - R
Segment Reporting (Details) - Reconciliation of Revenue from Segments to Consolidated - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue | ||
Revenues | $ 11,291 | $ 4,210 |
North America [Member] | ||
Revenue | ||
Revenues | 8,804 | 4,210 |
International [Member] | ||
Revenue | ||
Revenues | $ 2,487 | $ 0 |
Segment Reporting (Details) -_2
Segment Reporting (Details) - Reconciliation of Assets from Segment to Consolidated - USD ($) $ in Thousands | Mar. 31, 2023 | Mar. 31, 2022 |
Long-lived assets, net | ||
Long-Lived Assets | $ 6,156 | $ 6,739 |
North America [Member] | ||
Long-lived assets, net | ||
Long-Lived Assets | 5,472 | 5,893 |
International [Member] | ||
Long-lived assets, net | ||
Long-Lived Assets | $ 684 | $ 846 |