Workhorse (WKHS) 10-Q 7 May 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 07, 2019
Document and Entity Information [Abstract]
Entity Registrant Name	Workhorse Group Inc.
Entity Central Index Key	0001425287
Trading Symbol	WKHS
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		65,454,422

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 2,847,936	$ 1,512,750
Accounts receivable, less allowance for doubtful accounts of $0 at March 31, 2019 and December 31, 2018	362,350
Lease receivable	41,375	48,271
Inventory	2,490,798	2,533,616
Prepaid expenses and deposits	2,048,834	2,274,595
Current assets, Total	7,791,293	6,369,232
Noncurrent assets:
Property, plant and equipment, net	5,140,764	5,237,451
Lease receivable	193,774	198,090
Assets, Total	13,125,831	11,804,773
Current liabilities:
Accounts payable	3,639,233	4,340,463
Accrued liabilities	3,900,388	3,946,386
Warranty liability	6,911,167	7,058,769
Warrant liability	2,390,884	1,822,819
Customer deposits	394,000	406,000
Duke financing obligation	1,340,700	1,340,700
Revolving loan	4,104,140
Total current liabilities	22,680,512	18,915,137
Long-term debt	8,441,129	8,312,079
Stockholders' equity (deficit):
Series A preferred stock, par value of $.001 per share 75,000,000 shares authorized, 0 shares issued and outstanding at March 31, 2019 and December 31, 2018
Common stock, par value of $.001 per share 100,000,000 shares authorized, 61,496,990 shares issued and outstanding at March 31, 2019 and 58,270,934 shares issued and outstanding at December 31, 2018	61,497	58,271
Additional paid-in capital	129,764,361	126,076,782
Accumulated deficit	(147,821,668)	(141,557,496)
Stockholders' equity (deficit), Total	(17,995,810)	(15,422,443)
Liabilities and Stockholders' Equity (Deficit), Total	$ 13,125,831	$ 11,804,773

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 0	$ 0
Series A preferred stock, par value	$ .001	$ .001
Series A preferred stock, shares authorized	75,000,000	75,000,000
Series A preferred stock, shares issued	0	0
Series A preferred stock, shares outstanding	0	0
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	61,496,990	58,270,934
Common stock, shares outstanding	61,496,990	58,270,934

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Net sales	$ 364,182	$ 560,229
Cost of sales	1,397,606	1,698,280
Warranty expense		16,090
Gross loss	(1,033,424)	(1,154,141)
Operating expenses
Selling, general and administrative	2,090,890	2,400,147
Research and development	1,362,275	2,337,631
Total operating expenses	3,453,165	4,737,778
Interest expense, net	1,777,583	525,887
Net loss	$ (6,264,172)	$ (6,417,806)
Basic and diluted loss per share	$ (0.11)	$ (0.16)
Weighted average number of common shares outstanding	55,260,519	40,258,234

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders Equity (Deficit) - USD ($)	Common Stock	Series A Preferred Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balance at Dec. 31, 2017	$ 41,529		$ 107,760,036	$ (104,290,000)	$ 3,511,565
Balance shares at Dec. 31, 2017	41,529,181
Issuance of common stock	$ 395		1,187,020		1,187,415
Issuance of common stock, shares	395,226
Stock options and warrants exercised	$ 42		87,273		87,315
Stock options and warrants exercised, shares	42,143
Share based compensation			72,178		72,178
Net loss from operations				(6,417,808)	(6,417,806)
Ending Balance at Mar. 31, 2018	$ 41,966		109,106,507	(110,707,808)	(1,559,335)
Ending Balance, shares at Mar. 31, 2018	41,966,550
Balance at Dec. 31, 2018	$ 58,271		126,076,782	(141,557,496)	(15,422,443)
Balance shares at Dec. 31, 2018	58,270,934
Issuance of common stock	$ 3,226		2,996,509		2,999,735
Issuance of common stock, shares	3,226,056
Share based compensation			691,070		691,070
Net loss from operations				(6,264,172)	(6,264,172)
Ending Balance at Mar. 31, 2019	$ 61,497		$ 129,764,361	$ (147,821,668)	$ (17,995,810)
Ending Balance, shares at Mar. 31, 2019	61,496,990

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash flows from operating activities:
Net loss	$ (6,264,172)	$ (6,417,806)
Adjustments to reconcile net loss from operations to cash used by operations:
Depreciation	96,687	48,359
Amortization of Marathon loan issuance costs	129,050
Amortized discount and debt issuance costs on Senior Secured Notes		493,750
Stock based compensation	691,070	72,178
Change in fair value - warrants	568,066
Effects of changes in operating assets and liabilities:
Accounts receivable and lease receivable	(351,138)	693,278
Inventory	42,818	(405,627)
Prepaid expenses and deposits	225,761	730,365
Accounts payable and accrued liabilities	(747,229)	(70,024)
Warranty	(147,602)	61,312
Customer deposits	(12,000)	212,595
Net cash used by operations	(5,768,689)	(4,581,620)
Cash flows from investing activities:
Capital expenditures
Net cash provided by investing activities
Cash flows from financing activities:
Payments on long-term debt		(9,024)
Proceeds from revolving loans	4,104,140
Issuance of common stock	2,999,735	1,187,415
Exercise of warrants and options		87,315
Net cash provided by financing activities	7,103,875	1,265,706
Change in cash and cash equivalents	1,335,186	(3,315,914)
Cash at the beginning of the period	1,512,750	4,069,477
Cash at the end of the period	$ 2,847,936	$ 753,563

Summary of Significant Accounti

Summary of Significant Accounting Principles	3 Months Ended
	Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES	1. SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES The following accounting principles and practices are set forth to facilitate the understanding of data presented in the condensed consolidated financial statements: Nature of operations and principles of consolidation Workhorse Group Inc. and its predecessor companies (“Workhorse”, the “Company”, “we”, “us” or “our”) is a technology company focused on providing sustainable and cost-effective solutions to the commercial transportation sector. As an American manufacturer, we design and build high performance battery-electric vehicles and aircraft that make movement of people and goods more efficient and less harmful to the environment. As part of our solution, we also develop cloud-based, real-time telematics performance monitoring systems that enable fleet operators to optimize energy and route efficiency. Although we operate as a single unit through our subsidiaries, we approach our development through two divisions, Automotive and Aviation. We are currently focused on our core competency of bringing the N-GEN electric cargo van to market and fulfilling our existing backlog of orders. We are also exploring other opportunities in monetizing our intellectual property which could include a sale, license or other arrangement of assets that are outside of our core focus. The Company’s wholly owned subsidiaries include Workhorse Technologies Inc., Workhorse Motor Works Inc. and Workhorse Properties Inc. Basis of presentation The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has limited revenues and a history of negative working capital and stockholders’ deficits. Our existing capital resources will be insufficient to fund our operations through the first half of 2019. Unless and until we are able to generate a sufficient amount of revenue, reduce our costs and/or enter a strategic relationship, we expect to finance future cash needs through public and/or private offerings of equity securities and /or debt financings. If we are not able to obtain additional financing and/or substantially increase revenue from sales, we will be unable to continue as a going concern. These conditions raise substantial doubt about the ability of the Company to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon the continued operations of the Company, which, in turn, is dependent upon the Company’s ability to meet its financial requirements, raise additional capital, and successfully carry out its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary, should the Company not continue as a going concern. The Company has continued to raise capital. Management believes the proceeds from these offerings, future offerings, and the Company’s anticipated revenue, provides an opportunity to continue as a going concern. If additional funding is required, the Company plans to obtain working capital from either debt or equity financing from the sale of common stock, preferred stock, and/or convertible debentures. Obtaining such working capital is not assured. The Company is currently in a production ramp up mode and placing greater emphasis on manufacturing capability. In the opinion of Management, the Unaudited Condensed Consolidated Financial Statements include all adjustments that are necessary for the fair presentation of Workhorse’s respective financial conditions, results of operations and cash flows for the interim periods presented. Such adjustments are of a normal, recurring nature. Intercompany balances and transactions are eliminated in consolidation. The results of operations and cash flows for the interim periods presented may not necessarily be indicative of full-year results. It is suggested that these financial statements be read in conjunction with the audited consolidated financial statements and notes thereto of Workhorse contained in its Annual Report on Form 10-K for the year ended December 31, 2018 . The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. Certain reclassifications were made to the prior year financial statements to conform to the current year presentation. These reclassifications had no effect on previously reported results of operation or stockholders’ equity.

Inventory

Inventory	3 Months Ended
	Mar. 31, 2019
Inventory Disclosure [Abstract]
INVENTORY	2. INVENTORY As of March 31, 2019, and December 31, 2018, our inventory consisted of the following: 2019 2018 Raw materials $ 4,276,819 $ 4,319,637 Work in process 702,079 702,079 Finished goods - - 4,978,898 5,021,716 Less: Inventory reserve 2,488,100 2,488,100 $ 2,490,798 $ 2,533,616

Revenue

Revenue	3 Months Ended
	Mar. 31, 2019
Revenue Recognition and Deferred Revenue [Abstract]
REVENUE	3. REVENUE Revenue Recognition Net sales include products and shipping and handling charges, net of estimates for customer allowances. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products. All revenue is recognized when we satisfy our performance obligations under the contract. We recognize revenue by transferring the promised products to the customer, with the majority of revenue recognized at the point in time the customer obtains control of the products. We recognize revenue for shipping and handling charges at the time the products are delivered to or picked up by the customer. The majority of our contracts have a single performance obligation and are short term in nature. Accounts Receivable Credit is extended based upon an evaluation of the customer’s financial condition. Accounts receivable are stated at their estimated net realizable value. The allowance for doubtful accounts is based on an analysis of customer accounts and our historical experience with accounts receivable write-offs. The Company has elected the following practical expedients allowed under ASU 2014-09: · Performance obligations are satisfied within one year from a given reporting date, consequently we omit disclosure of the transaction price apportioned to remaining performance obligations on open orders Disaggregation of Revenue Our revenues related to the following types of business were as follows for the periods ended March 31: Three Months Ended 2019 2018 Automotive $ 240,000 $ 404,854 Aviation - - Other 124,182 155,375 Total revenues $ 364,182 $ 560,229

Debt

Debt	3 Months Ended
	Mar. 31, 2019
Debt Disclosure [Abstract]
DEBT	4. DEBT Debt consists of the following: March 31, December 31, Marathon Tranche One Loan, due December 31, 2021, interest only quarterly payments, variable interest rate of 10.4% as of March 31, 2019 (discount is based on warrant valuation of approximately 9.7%) $ 10,000,000 $ 10,000,000 Marathon Tranche Two Loan, due December 31, 2021, interest only quarterly payments, variable interest rate of 10.4% as of March 31, 2019 (discount is based on warrant valuation of approximately 9.7%) 4,104,140 - Marathon Credit Agreement unamortized discount and issuance costs (1,558,871 ) (1,687,921 ) Net Marathon Credit Agreement 12,545,269 8,312,079 Less current portion 4,104,140 - Long-term debt $ 8,441,129 $ 8,312,079 On December 31, 2018, the Company entered into a Credit Agreement (the “Credit Agreement”), among the Company, as borrower, Marathon Asset Management, LP, on behalf of certain entities it manages, as lenders (collectively, with their permitted successors and assignees, the “Lenders”), and Wilmington Trust, National Association, as the agent (“Wilmington”). The Credit Agreement provided the Company with a $10 million tranche of term loans (the “Tranche One Loans”) which may not be re-borrowed following repayment and (ii) a $25 million tranche of revolving loans which may be re-borrowed following repayment (the “Tranche Two Loans” together with the Tranche One Loans, the “Loans”). In accordance with the Credit Agreement, the Company issued each Lender a Common Stock Purchase Warrant to purchase, in the aggregate, 8,053,390 shares of common stock of the Company at an exercise price of $1.25 per share exercisable in cash only for a period of three years and then for cash or cashless thereafter (collectively, the “Initial Warrants”). Until the later of the repayment of all obligations owed to the Lenders or two years from the closing date, the Company will be required to issue additional Common Stock Purchase Warrants (the “Additional Warrants”) to the Lenders equal to 10%, in the aggregate, of any additional equity issuances, subject to certain exceptions, on substantially the same terms and conditions of the Initial Warrants, except that (i) the applicable expiration date thereof shall be five years from the issuance date of the applicable warrant, (ii) the initial exercise price shall be a price equal to the price per share of common stock used in the relevant issuance multiplied by 110% and (iii) the holder shall be entitled to exercise the warrant on a cashless exercise at any time the warrant is exercisable. Principal amounts: At Tranche One - Principal $ 10,000,000 Tranche Two – Current amount drawn 4,104,140 Unamortized debt discount and issuance costs (1) (1,558,871 ) Net debt carrying amount $ 12,545,269 Carrying amount of warrant the liability component (2) $ 1,295,637 (1) Includes the unamortized portion of the initial warrant liability of $965,747 and issuance costs of $722,174. (2) Includes marked to market liability of initial Marathon warrant liability and subsequent warrant issuances.

Duke Financing Obligation

Duke Financing Obligation	3 Months Ended
	Mar. 31, 2019
Duke Financing Obligation [Abstract]
DUKE FINANCING OBLIGATION	5. DUKE FINANCING OBLIGATION On November 28, 2018, the Company entered into a Sales Agreement with Duke Energy One, Inc., a wholly-owned subsidiary of Duke Energy Corporation (NYSE: DUK) (“Duke”), pursuant to which the Company sold Duke 615,000 battery cells (the “615,000 Cells”) in consideration of $1,340,700. Workhorse will continue to use the cells in the near term for the delivery of trucks to UPS and DHL. Until May 1, 2019, the Company has the right and option to require Duke to sell the 615,000 Cells back to the Company and Duke has the right and option to require the Company to purchase the 615,000 Cells at price equal to the price the 615,000 Cells were sold. On November 28, 2018, in consideration for consenting to the Company selling the 615,00 Cells to Duke, which served as collateral for Arosa the Loan Agreement, the Company entered into a Limited Consent, Waiver and Release with Arosa pursuant to which the Company issued Arosa 2,000,000 shares of common stock and restruck the exercise price of warrants previously issued to Arosa to $1.25 per share. In addition, while the Arosa Loan remained outstanding, the exercise price of the Arosa Warrants will be restruck to equal the price of any equity issued by the Company, including the issuance of any common stock purchase warrants or other derivative convertible securities, if the issuing price of such securities is less than $1.25. On April 30, 2019, Duke and the Company entered into an agreement to amend the initial Sales Agreement to extend the expiration date from May 1, 2019 to October 15, 2019. The Duke transactions was accounted for as a financing obligation and as such, the Company has recorded a $1,340,700 liability related to the transaction.

Stock Based Compensation

Stock Based Compensation	3 Months Ended
	Mar. 31, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
STOCK BASED COMPENSATION	6. STOCK BASED COMPENSATION Options to directors, officers, consultants and employees The Company maintains, as adopted by the board of directors, the 2017 Stock Incentive Plan, the 2016 Stock Incentive Plan, the 2014 Stock Incentive Plan, the 2014 Stock Compensation Plan, 2013 Incentive Stock Plan, the 2012 Incentive Stock Plan, the 2011 Incentive Stock Plan and the 2010 Stock Incentive Plan (the “Plans”) providing for the issuance of options to employees, officers, directors or consultants of the Company. Non-qualified stock options granted under the plans may only be granted with an exercise price equal to the fair market value of the Company’s common stock on the date of grant. Awards under the plans may be either vested or unvested options. The 2017 Stock Incentive Plan authorized 5,000,000 shares with vesting in sixteen equal quarterly tranches. In addition to the Plans, the Company has granted, on various dates, stock options to directors, officers, consultants and employees to purchase common stock of the Company. The terms, exercise prices and vesting of these awards vary. The following table summarizes option activity for directors, officers, consultants and employees: Outstanding Stock Options Options Available for Grant Number of Options Weighted Average Exercise Price per Option Weighted Average Grant Date Fair Value per Option Weighted Average Remaining Exercise Term in Months Balance December 31, 2017 4,145,774 3,851,371 3.11 1.84 43 Additional stock reserved - - - - - Granted (340,000 ) 340,000 1.18 0.54 56 Exercised - (52,500 ) 1.24 0.68 - Forfeited - - - - - Expired - (271,250 ) 3.22 1.58 - Balance December 31, 2018 3,805,774 3,867,621 $ 4.05 $ 1.84 64 Additional stock reserved Granted (2,000,000 ) 2,000,000 0.97 0.55 88 Exercised Forfeited 1,359,069 (1,359,069 ) 4.73 1.94 31 Expired Balance March 31, 2019 3,164,843 4,508,552 $ 2.48 $ 1.24 65

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2019
Income Tax Disclosure [Abstract]
INCOME TAXES	7. INCOME TAXES As the Company has not generated taxable income since inception, the cumulative deferred tax assets remain fully reserved, and no provision or liability for federal or state income taxes has been included in the financial statements.

Earnings Per Share

Earnings Per Share	3 Months Ended
	Mar. 31, 2019
Earnings Per Share [Abstract]
EARNINGS PER SHARE	8. EARNINGS PER SHARE Basic loss per share is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. For all periods presented, all of the Company's common stock equivalents were excluded from the calculation of diluted loss per common share because they were anti-dilutive, due to the Company's net losses.

Recent Accounting Developments

Recent Accounting Developments	3 Months Ended
	Mar. 31, 2019
Accounting Changes and Error Corrections [Abstract]
RECENT ACCOUNTING DEVELOPMENTS	9. RECENT ACCOUNTING DEVELOPMENTS Accounting Guidance Adopted in 2018 Effective January 1, 2018, we adopted Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, and affects the guidance in ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). ASU No. 2016-10 clarifies the following two aspects of Topic 606: evaluating whether promised goods and services are separately identifiable and determining whether an entity’s promise to grant a license provides a customer with either a right to use the entity’s intellectual property, which is satisfied at a point in time, or a right to access the entity’s intellectual property, which is satisfied over time. The Company adopted ASU No. 2016-10, using the modified retrospective approach, which did not have a material impact on the Company’s condensed consolidated financial statements. Additional information is available in Note 4, “Revenue.” Effective January 1, 2018, we adopted FASB ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net), and affects the guidance in ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” . When another party is involved in providing goods or services to a customer, ASU No. 2014-09 requires an entity to determine whether the nature of its promise is to provide the specified good or service itself (that is, the entity is a principal) or to arrange for that good or service to be provided by the other party (that is, the entity is an agent). The amendments in ASU No. 2016-08 are intended to improve the operability and understandability of the implementation guidance in ASU No. 2014-09 on principal versus agent considerations by offering additional guidance to be considered in making the determination. The Company adopted ASU No. 2016-08, using the modified retrospective approach, which did not have a material impact on the Company’s condensed consolidated financial statements. Additional information is available in Note 4, “ Revenue. Accounting Guidance Adopted in 2019 In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires a lessee to recognize in the statement of financial position a liability to make lease payments (“the lease liability”) and a right-of-use asset representing its right to use the underlying asset for the lease term, initially measured at the present value of the lease payments. When measuring assets and liabilities arising from a lease, the lessee should include payments to be made in optional periods only if the lessee is reasonably certain, as defined, to exercise an option to the lease or not to exercise an option to terminate the lease. Optional payments to purchase the underlying asset should be included if the lessee is reasonably certain it will exercise the purchase option. Most variable lease payments should be excluded except for those that depend on an index or a rate or are in substance fixed payments. A lessee shall classify a lease as a finance lease if it meets any of five listed criteria: 1) The lease transfers ownership of the underlying asset to the lessee by the end of the lease term. 2) The lease grants the lessee and option to purchase the underlying asset that the lessee is reasonably certain to exercise. 3) The lease term is for the major part of the remaining economic life of the underlying asset. 4) The present value of the sum of the lease payments and any residual value guaranteed by the lessee equals or exceeds substantially all of the fair value of the underlying asset. 5) The underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. For finance leases, a lessee shall recognize in the statement of comprehensive income interest on the lease liability separately from amortization of the right-of-use asset. Amortization of the right-of-use asset shall be on a straight-line basis, unless another basis is more representative of the pattern in which the lessee expects to consume the right-of-use asset’s future economic benefits. If the lease does not meet any of the five criteria, the lessee shall classify it as an operating lease and shall recognize a single lease cost on a straight-line basis over the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the lease term. The amendments in this update were applied using the current period adjustment method, as defined, and were effective on January 1, 2019. The adoption of this standard did not have a material impact on the condensed consolidated financial statements.

Stock Offerings

Stock Offerings	3 Months Ended
	Mar. 31, 2019
Private Placement Memorandum and Stock Offering [Abstract]
STOCK OFFERINGS	10. STOCK OFFERINGS On June 22, 2017, the Company entered into an at the market issuance sales agreement (the “Cowen Agreement”) with Cowen and Company, LLC (“Cowen”) under which the Company may offer and sell, from time to time at its sole discretion, shares of its Common Stock having an aggregate offering price of up to $25.0 million through Cowen as its sales agent. As of March 31, 2019, the Company issued 4,464,777 shares from this facility for proceeds of approximately $8.7 million. On September 14, 2017, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Cowen relating to the public offering and sale (the “Offering”) of 3,749,996 shares of the Company’s common stock, and five-year warrants (exercisable beginning on the date of issuance) to purchase up to an aggregate of 2,812,497 shares of the Company’s common stock. Each investor received a warrant to purchase 0.75 shares of the Company’s common stock at an exercise price of $3.80 per share, for each share of common stock purchased. Pursuant to the Underwriting Agreement, Cowen purchased 3,749,996 shares of the Company’s common stock and accompanying warrants at a price per share of $3.20. The net proceeds to the Company were approximately $10.9 million after deducting underwriting discounts and commissions and offering expenses. The sale of such shares and accompanying warrants closed on September 18, 2017. The warrants contain full ratchet anti-dilution protection upon the issuance of any common stock, securities convertible into common stock or certain other issuances at a price below the then existing exercise price of the warrants, with certain exceptions. On June 4, 2018, the Company and holders of all outstanding Warrants to Purchase Common Stock of the Company issued September 18, 2017 (collectively, the “Warrants”) entered into separate, privately-negotiated exchange agreements (the “Exchange Agreements”), pursuant to which the Company issued to such holders an aggregate of 1,968,736 shares of the Company’s common stock in exchange for the Warrants. The closing of the exchanges contemplated by the Exchange Agreements occurred on June 5, 2018. In addition, the “Down Round” feature of the Warrants was triggered in the second quarter of 2018, causing the strike price to decrease from $3.80 per share to $2.62 per share. As a result, the Company recorded approximately $765,179 as a deemed dividend which represents the value transferred to the Warrant holders due to the Down Round being triggered. The deemed dividend was recorded as a reduction of Retained Earnings and increase in Additional Paid-in-Capital and reduced net income available to common shareholders by the same amount. On August 9, 2018, the Company entered into an Underwriting Agreement (the “Underwriting Agreement”) with National Securities Corporation (the “Underwriter”), relating to the public offering and sale (the “2018 Offering”) of 9,000,000 shares of our Common Stock at a price per share of $1.15 for aggregate gross proceeds of $10.4 million. This offering closed on August 13, 2018. Pursuant to the Underwriting Agreement, the Company granted the Underwriter a 45-day option to purchase from the Company up to an additional 1,350,000 shares of Common Stock at the offering price to cover over allotments, if any. On August 14, 2018, the Underwriter exercised its over-allotment option and acquired an additional 1,288,800 shares of Common Stock at a price per share of $1.15 for aggregate gross proceeds of $1.4 million. The over-allotment closing occurred on August 14, 2018. The Company used the net proceeds from this offering for working capital, general corporate purposes and repayment of debt and other obligations. Commencing February 11, 2019, the Company entered into and closed Subscription Agreements with accredited investors (the “February 2019 Accredited Investors”) pursuant to which the February 2019 Accredited Investors purchased 1,499,684 shares of the Company’s common stock for a purchase price of $1,365,000. If, prior to the six month anniversary, the Company issues shares of its common stock for a purchase price per share less than the purchase price paid by the February 2019 Accredited Investors subject to standard carve-outs (a “Down Round”), the Company will issue additional shares of common stock (for no additional consideration) to the February 2019 Accredited Investors such that the effective purchase price per share is equal to the purchase price per share paid in the Down Round. Benjamin Samuels and Gerald Budde, directors of the Company, acquired 841,928 and 26,310 shares of common stock, respectively, as part of this offering, provided, however, their per share purchase was $0.9501, which was above the closing price the date prior to close and they did not receive the Down Round protection.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2019
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	11. SUBSEQUENT EVENTS The Company evaluates events and transactions occurring subsequent to the date of the condensed consolidated financial statements for matters requiring recognition or disclosure in the condensed consolidated financial statements. The accompanying condensed consolidated financial statements consider events through the date on which the condensed consolidated financial statements were available to be issued. Second Amendment to Credit Agreement On April 1, 2019, the Company entered into the Second Amendment to Credit Agreement (the “Marathon Second Amendment”), among the Company, as borrower, certain affiliates of Marathon Asset Management, LP, as lenders (collectively, with their permitted successors and assignees, the “Lenders”), and Wilmington Trust, National Association, as the agent (“Wilmington”) amending certain terms of the Credit Agreement, dated as of December 31, 2018 (as amended, restated, amended and restated or otherwise modified prior to the date hereof), between the Company, the Lenders and Wilmington. The Marathon Second Amendment delayed the application of certain financial covenants including: (i) the minimum liquidity, providing that at least $4 million must be maintained at all times on or after April 30, 2019 rather than beginning on March 31, 2019; (ii) the maximum total leverage ratio (ratio of total debt borrowed by the Company and its subsidiaries to EBITDA), providing that the maximum total leverage ratio shall not exceed 4.50:1.00 on the last day of the quarter ending December 31, 2019, rather than beginning with the quarter ending September 30, 2019, which total leverage ratio is adjusted for subsequent quarters as set forth in the Credit Agreement; and (iii) the maximum debt service coverage ratio (ratio of EBITDA (for the four consecutive fiscal quarters most recently ended, subject to certain adjustments set forth in the Credit Agreement) to interest expense and payments for operating leases), providing that the maximum debt service coverage ratio shall not exceed 1.25:1.00 on the last day of the quarter ending December 31, 2019, rather than beginning with the quarter ending September 30, 2019, which debt service coverage ratio is adjusted for subsequent quarters as set forth in the Credit Agreement. Warrant Amendments On April 16, 2019, the Company entered into an Amendment No. 1 to Common Stock Purchase Warrants with Marathon Asset Management LP, on behalf of certain entities it manages, as warrant holders (collectively, the “Holders”) (collectively, the “Marathon Warrant Amendments”), amending certain terms of the existing warrants issued by the Company in favor of each Holder. Pursuant to the Marathon Warrant Amendments, unless the Company has obtained the approval of its shareholders as required by the Nasdaq Capital Market, the number of shares to be issued under warrants held by the Holders shall not exceed 19.99% of the issued and outstanding common stock of the Company as of December 31, 2018. The Marathon Warrant Amendments also provide that the failure to obtain shareholder approval of an increase in the number of authorized shares of common stock of the Company, sufficient to enable the Company to issue common stock upon exercise of the warrants held by each Holder, will constitute an event of default under the existing credit agreement among the Company, as borrower, the Holders, as lenders, and Wilmington Trust, National Association, as the agent. On April 17, 2019, the Company and Arosa Opportunistic Fund LP (“Arosa”) entered into Amendment No. 1 to Common Stock Purchase Warrant (the “Arosa Warrant Amendment”), amending certain terms of the existing warrants issued by the Company. Pursuant to the Arosa Warrant Amendment, until the Company obtains shareholder approval of an increase in the number of authorized shares of common stock of the Company, the Company will not be required to reserve shares of common stock for issuance under the warrants held by Arosa. If the Company does not increase the number of authorized shares of common stock by June 30, 2019, the amendment will be null and void. Subscription Agreement On April 30, 2019, the Company entered into a subscription agreement (the “Subscription Agreement”), with certain investors (the “Investors”) pursuant to which the Company agreed to issue and sell, in a registered public offering by the Company directly to the Investors (the “Registered Direct Offering”), 3,957,432 shares of Common Stock. The purchase price per share was $0.74. The closing of the Registered Direct Offering occurred on May 1, 2019. The Subscription Agreement contains customary representations, warranties and agreements by us and customary conditions to closing. The representations, warranties and covenants contained in the Subscription Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement and may be subject to limitations agreed upon by the contracting parties. The net proceeds to the Company are expected to be approximately $2.9 million, after deducting estimated expenses payable by the Company associated with the Registered Direct Offering. The Company expects to use the net proceeds from this offering for working capital, general corporate purposes and repayment of debt and other obligations. Third Amendment to Credit Agreement On April 30, 2019, the Company entered into the Third Amendment to Credit Agreement (the “Marathon Third Amendment”), among the Company, as borrower, certain affiliates of Marathon Asset Management, LP, as lenders (collectively, with their permitted successors and assignees, the “Lenders”), and Wilmington Trust, National Association, as the agent (“Wilmington”) amending certain terms of the Credit Agreement, dated as of December 31, 2018 (as amended, restated, amended and restated or otherwise modified prior to the date hereof), between the Company, the Lenders and Wilmington. The Marathon Third Amendment amended the minimum liquidity covenant, providing that at least $4 million must be maintained at all times at or after May 31, 2019 rather than at all times on or after April 30, 2019. Unless the Company fails to maintain minimum liquidity as of the last day of any calendar month, the Company may cure a failure to maintain minimum liquidity by increasing liquidity to $4,000,000 within five business days of the occurrence.

Summary of Significant Accoun_2

Summary of Significant Accounting Principles (Policies)	3 Months Ended
	Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of operations and principles of consolidation	Nature of operations and principles of consolidation Workhorse Group Inc. and its predecessor companies (“Workhorse”, the “Company”, “we”, “us” or “our”) is a technology company focused on providing sustainable and cost-effective solutions to the commercial transportation sector. As an American manufacturer, we design and build high performance battery-electric vehicles and aircraft that make movement of people and goods more efficient and less harmful to the environment. As part of our solution, we also develop cloud-based, real-time telematics performance monitoring systems that enable fleet operators to optimize energy and route efficiency. Although we operate as a single unit through our subsidiaries, we approach our development through two divisions, Automotive and Aviation. We are currently focused on our core competency of bringing the N-GEN electric cargo van to market and fulfilling our existing backlog of orders. We are also exploring other opportunities in monetizing our intellectual property which could include a sale, license or other arrangement of assets that are outside of our core focus. The Company’s wholly owned subsidiaries include Workhorse Technologies Inc., Workhorse Motor Works Inc. and Workhorse Properties Inc.
Basis of presentation	Basis of presentation The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has limited revenues and a history of negative working capital and stockholders’ deficits. Our existing capital resources will be insufficient to fund our operations through the first half of 2019. Unless and until we are able to generate a sufficient amount of revenue, reduce our costs and/or enter a strategic relationship, we expect to finance future cash needs through public and/or private offerings of equity securities and /or debt financings. If we are not able to obtain additional financing and/or substantially increase revenue from sales, we will be unable to continue as a going concern. These conditions raise substantial doubt about the ability of the Company to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon the continued operations of the Company, which, in turn, is dependent upon the Company’s ability to meet its financial requirements, raise additional capital, and successfully carry out its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary, should the Company not continue as a going concern. The Company has continued to raise capital. Management believes the proceeds from these offerings, future offerings, and the Company’s anticipated revenue, provides an opportunity to continue as a going concern. If additional funding is required, the Company plans to obtain working capital from either debt or equity financing from the sale of common stock, preferred stock, and/or convertible debentures. Obtaining such working capital is not assured. The Company is currently in a production ramp up mode and placing greater emphasis on manufacturing capability. In the opinion of Management, the Unaudited Condensed Consolidated Financial Statements include all adjustments that are necessary for the fair presentation of Workhorse’s respective financial conditions, results of operations and cash flows for the interim periods presented. Such adjustments are of a normal, recurring nature. Intercompany balances and transactions are eliminated in consolidation. The results of operations and cash flows for the interim periods presented may not necessarily be indicative of full-year results. It is suggested that these financial statements be read in conjunction with the audited consolidated financial statements and notes thereto of Workhorse contained in its Annual Report on Form 10-K for the year ended December 31, 2018 . The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. Certain reclassifications were made to the prior year financial statements to conform to the current year presentation. These reclassifications had no effect on previously reported results of operation or stockholders’ equity.

Inventory (Tables)

Inventory (Tables)	3 Months Ended
	Mar. 31, 2019
Inventory Disclosure [Abstract]
Schedule of inventory	2019 2018 Raw materials $ 4,276,819 $ 4,319,637 Work in process 702,079 702,079 Finished goods - - 4,978,898 5,021,716 Less: Inventory reserve 2,488,100 2,488,100 $ 2,490,798 $ 2,533,616

Revenue (Tables)

Revenue (Tables)	3 Months Ended
	Mar. 31, 2019
Revenue Recognition and Deferred Revenue [Abstract]
Schedule of disaggregation of revenue	Three Months Ended 2019 2018 Automotive $ 240,000 $ 404,854 Aviation - - Other 124,182 155,375 Total revenues $ 364,182 $ 560,229

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2019
Debt Disclosure [Abstract]
Schedule of long-term debt	March 31, December 31, Marathon Tranche One Loan, due December 31, 2021, interest only quarterly payments, variable interest rate of 10.4% as of March 31, 2019 (discount is based on warrant valuation of approximately 9.7%) $ 10,000,000 $ 10,000,000 Marathon Tranche Two Loan, due December 31, 2021, interest only quarterly payments, variable interest rate of 10.4% as of March 31, 2019 (discount is based on warrant valuation of approximately 9.7%) 4,104,140 - Marathon Credit Agreement unamortized discount and issuance costs (1,558,871 ) (1,687,921 ) Net Marathon Credit Agreement 12,545,269 8,312,079 Less current portion 4,104,140 - Long-term debt $ 8,441,129 $ 8,312,079
Schedule of issue additional warrants	Principal amounts: At Tranche One - Principal $ 10,000,000 Tranche Two – Current amount drawn 4,104,140 Unamortized debt discount and issuance costs (1) (1,558,871 ) Net debt carrying amount $ 12,545,269 Carrying amount of warrant the liability component (2) $ 1,295,637 (1) Includes the unamortized portion of the initial warrant liability of $965,747 and issuance costs of $722,174. (2) Includes marked to market liability of initial Marathon warrant liability and subsequent warrant issuances.

Stock Based Compensation (Table

Stock Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of option activity	Outstanding Stock Options Options Available for Grant Number of Options Weighted Average Exercise Price per Option Weighted Average Grant Date Fair Value per Option Weighted Average Remaining Exercise Term in Months Balance December 31, 2017 4,145,774 3,851,371 3.11 1.84 43 Additional stock reserved - - - - - Granted (340,000 ) 340,000 1.18 0.54 56 Exercised - (52,500 ) 1.24 0.68 - Forfeited - - - - - Expired - (271,250 ) 3.22 1.58 - Balance December 31, 2018 3,805,774 3,867,621 $ 4.05 $ 1.84 64 Additional stock reserved Granted (2,000,000 ) 2,000,000 0.97 0.55 88 Exercised Forfeited 1,359,069 (1,359,069 ) 4.73 1.94 31 Expired Balance March 31, 2019 3,164,843 4,508,552 $ 2.48 $ 1.24 65

Inventory (Details)

Inventory (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Components of inventories
Raw materials	$ 4,276,819	$ 4,319,637
Work in process	702,079	702,079
Finished goods
Inventory Gross	4,978,898	5,021,716
Less: Inventory reserve	2,488,100	2,488,100
Inventory, Total	$ 2,490,798	$ 2,533,616

Revenue (Details)

Revenue (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Total revenues	$ 364,182	$ 560,229
Automotive [Member]
Total revenues	240,000	404,854
Aviation [Member]
Total revenues
Other [Member]
Total revenues	$ 124,182	$ 155,375

Debt (Details)

Debt (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Less current portion	$ 4,104,140
Long-term debt	8,441,129	8,312,079
Marathon Tranche Loan [Member]
Debt Instrument [Line Items]
Marathon Tranche One Loan, due December 31, 2021, interest only quarterly payments, variable interest rate of 10.4% as of March 31, 2019 (discount is based on warrant valuation of approximately 9.7%)	10,000,000	10,000,000
Marathon Tranche Two Loan, due December 31, 2021, interest only quarterly payments, variable interest rate of 10.4% as of March 31, 2019 (discount is based on warrant valuation of approximately 9.7%)	4,104,140
Marathon Credit Agreement unamortized discount and issuance costs	(1,558,871)	(1,687,921)
Net Marathon Credit Agreement	$ 12,545,269	$ 8,312,079

Debt (Details 1)

Debt (Details 1) - Tranche [Member]	Mar. 31, 2019USD ($)
Principal amounts:
Tranche One - Principal	$ 10,000,000
Tranche Two – Current amount drawn	4,104,140
Unamortized debt discount and issuance costs	(1,558,871)	[1]
Net debt carrying amount	12,545,269
Carrying amount of warrant the liability component	$ 1,295,637	[2]
[1]	Includes the unamortized portion of the initial warrant liability of $965,747 and issuance costs of $722,174.
[2]	Includes marked to market liability of initial Marathon warrant liability and subsequent warrant issuances.

Debt (Details Textual)

Debt (Details Textual) - USD ($)	1 Months Ended	3 Months Ended
	Dec. 31, 2018	Mar. 31, 2019	Mar. 31, 2018
Debt Instrument [Line Items]
Amortization expense		$ 129,050
Value of warrants		$ 568,066
Credit Agreement [Member]
Debt Instrument [Line Items]
Warrants to purchase of common stock shares		8,053,390
Warrants exercise price		$ 1.25
Warrants to purchase common stock, description		The Company will be required to issue additional Common Stock Purchase Warrants (the "Additional Warrants") to the Lenders equal to 10%, in the aggregate, of any additional issuance, subject to certain exceptions, on substantially the same terms and conditions of the Initial Warrants, except that (i) the applicable expiration date thereof shall be five years from the issuance date of the applicable warrant, (ii) the initial exercise price shall be a price equal to the price per share of common stock used in the relevant issuance multiplied by 110% and (iii) the holder shall be entitled to exercise the warrant on a cashless exercise at any time the warrant is exercisable.
Credit agreement, description	The Company with a $10 million tranche of term loans (the "Tranche One Loans") which may not be re-borrowed following repayment and (ii) a $25 million tranche of term loans which may be re-borrowed following repayment (the "Tranche Two Loans" together with the Tranche One Loans, the "Loans").
Value of warrants		$ 965,747
Debt discount		$ 722,174

Duke Financing Obligation (Deta

Duke Financing Obligation (Details)	11 Months Ended
	Nov. 28, 2018USD ($)$ / sharesshares
Arosa [Member]
Duke Financing Obligation (Textual)
Stock warrants exercised | shares	2,000,000
Exercise price | $ / shares	$ 1.25
Duke financing obligation	$ 1,340,700
Sales Agreement [Member]
Duke Financing Obligation (Textual)
Sales of battery cells units	615,000
Sales consideration	$ 1,340,700
Sales description	Until May 1, 2019, the Company has the right and option to require Duke to sell the 615,000 Cells back to the Company and Duke has the right and option to require the Company to purchase the 615,000 Cells at price equal to the price the 615,000 Cells were sold.

Stock Based Compensation (Detai

Stock Based Compensation (Details) - Stock Options [Member] - Directors, officers consultants and employees [Member] - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Options Available for Grant
Options Available for Grant, Outstanding, Beginning Balance	3,805,774	4,145,774
Options Available for Grant, Additional stock reserved
Options Available for Grant, Granted	(2,000,000)	(340,000)
Options Available for Grant, Exercised
Options Available for Grant, Forfeited	1,359,069
Options Available for Grant, Expired
Options Available for Grant, Outstanding, Ending Balance	3,164,843	3,805,774
Number of Options
Number of Options, Outstanding, Beginning Balance	3,867,621	3,851,371
Number of Options, Outstanding, Additional stock reserved
Number of Options, Granted	2,000,000	340,000
Number of Options, Exercised		(52,500)
Number of Options, Forfeited	(1,359,069)
Number of Options, Expired		(271,250)
Number of Options, Outstanding, Ending Balance	4,508,552	3,867,621
Weighted Average Exercise Price per Option
Weighted Average Exercise Price per Option, Outstanding, Beginning Balance	$ 4.05	$ 3.11
Weighted Average Exercise Price per Option, Additional stock reserved
Weighted Average Exercise Price per Option, Granted	0.97	1.18
Weighted Average Exercise Price per Option, Exercised		1.24
Weighted Average Exercise Price per Option, Forfeited	4.73
Weighted Average Exercise Price per Option, Expired		3.22
Weighted Average Exercise Price per Option, Outstanding, Ending Balance	2.48	4.05
Weighted Average Grant Date Fair Value per Option
Weighted Average Grant Date Fair Value per Option, Outstanding, Beginning Balance	1.84	1.84
Weighted Average Grant Date Fair Value per Option, Additional stock reserved
Weighted Average Grant Date Fair Value per Option, Granted	0.55	0.54
Weighted Average Grant Date Fair Value per Option, Exercised		0.68
Weighted Average Grant Date Fair Value per Option, Forfeited	1.94
Weighted Average Grant Date Fair Value per Option, Expired		1.58
Weighted Average Grant Date Fair Value per Option, Outstanding, Ending Balance	$ 1.24	$ 1.84
Weighted Average Remaining Exercise Term in Months
Weighted Average Remaining Exercise Term in Months, Outstanding, Beginning Balance	64 months	43 months
Weighted Average Remaining Exercise Term in Months, Granted	88 months	56 months
Weighted Average Remaining Exercise Term in Months, Forfeited	31 years
Weighted Average Remaining Exercise Term in Months, Outstanding, Ending Balance	65 years	64 months

Stock Based Compensation (Det_2

Stock Based Compensation (Details Textual)	Mar. 31, 2019shares
Stock Incentive Plan [Member]
Stock Based Compensation (Textual)
Options authorized	5,000,000

Stock Offerings (Details)

Stock Offerings (Details) - USD ($)	Feb. 11, 2019	Aug. 09, 2018	Jun. 04, 2018	Sep. 14, 2017	Jun. 22, 2017	Mar. 31, 2019	Mar. 31, 2018	Jun. 30, 2018
Stock Offerings (Textual)
Common stock of offering value						$ 2,999,735	$ 1,187,415
Aggregate common stock in exchange for warrants			1,968,736
Deemed dividend			$ 765,179
Cowen Agreement [Member]
Stock Offerings (Textual)
Common stock of offering value					$ 25,000,000
Issuance shares of facility, shares						4,464,777
Issuance shares of facility						$ 8,700,000
Underwriting Agreement [Member]
Stock Offerings (Textual)
Shares of common stock public offering		9,000,000		3,749,996
Common stock of offering value		$ 10,400,000
Purchase of common stock, shares				2,812,497		3,749,996
Net of proceeds from issuance of initial public offering						$ 10,900,000
Underwriting commitments, description		Pursuant to the Underwriting Agreement, the Company granted the Underwriter a 45-day option to purchase from the Company up to an additional 1,350,000 shares of Common Stock at the offering price to cover over allotments, if any. On August 14, 2018, the Underwriter exercised its over-allotment option and acquired an additional 1,288,800 shares of Common Stock at a price per share of $1.15 for aggregate gross proceeds of $1.4 million.		Each investor received a warrant to purchase 0.75 shares of the Company's common stock at an exercise price of $3.80 per share, for each share of common stock purchased.
Warrants expiration term				5 years
Common stock price per share		$ 1.15				$ 3.20
Subscription Agreements [Member]
Stock Offerings (Textual)
Purchase of common stock, shares	1,499,684
Common stock purchase price	$ 1,365,000
Underwriting commitments, description	The February 2019 Accredited Investors such that the effective purchase price per share is equal to the purchase price per share paid in the Down Round. Benjamin Samuels and Gerald Budde, directors of the Company, acquired 841,928 and 26,310 shares of common stock, respectively, as part of this offering, provided, however, their per share purchase was $0.9501, which was above the closing price the date prior to close and they did not receive the Down Round protection.
Minimum [Member]
Stock Offerings (Textual)
Strike price of warrants								$ 2.62
Maximum [Member]
Stock Offerings (Textual)
Strike price of warrants								$ 3.80

Subsequent Events (Details)

Subsequent Events (Details) - USD ($)	1 Months Ended
	Apr. 30, 2019	Feb. 11, 2019
Subscription Agreements [Member]
Subsequent Events (Textual)
Purchase of common stock, shares		1,499,684
Subsequent Event [Member]
Subsequent Events (Textual)
Credit agreement, description	(i) the minimum liquidity, providing that at least $4 million must be maintained at all times on or after April 30, 2019 rather than beginning on March 31, 2019;     (ii) the maximum total leverage ratio (ratio of total debt borrowed by the Company and its subsidiaries to EBITDA), providing that the maximum total leverage ratio shall not exceed 4.50:1.00 on the last day of the quarter ending December 31, 2019, rather than beginning with the quarter ending September 30, 2019, which total leverage ratio is adjusted for subsequent quarters as set forth in the Credit Agreement; and     (iii) the maximum debt service coverage ratio (ratio of EBITDA (for the four consecutive fiscal quarters most recently ended, subject to certain adjustments set forth in the Credit Agreement) to interest expense and payments for operating leases), providing that the maximum debt service coverage ratio shall not exceed 1.25:1.00 on the last day of the quarter ending December 31, 2019, rather than beginning with the quarter ending September 30, 2019, which debt service coverage ratio is adjusted for subsequent quarters as set forth in the Credit Agreement.
Subsequent Event [Member] | Subscription Agreements [Member]
Subsequent Events (Textual)
Purchase of common stock, shares	3,957,432
Purchase price per	$ 0.74
Net proceeds	$ 2,900,000
Amendment to credit agreement, description	The Marathon Third Amendment amended the minimum liquidity covenant, providing that at least $4 million must be maintained at all times at or after May 31, 2019 rather than at all times on or after April 30, 2019. Unless the Company fails to maintain minimum liquidity as of the last day of any calendar month, the Company may cure a failure to maintain minimum liquidity by increasing liquidity to $4,000,000 within five business days of the occurrence.