Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 16, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Entity File Number | 000-54391 | |
Entity Registrant Name | SMG Industries Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0662991 | |
Entity Address, Address Line One | 20475 State Hwy 249, SuiteĀ 450 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77070 | |
City Area Code | 713 | |
Local Phone Number | 955-3497 | |
Title of 12(b) Security | None | |
Trading Symbol | SMGI | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 35,124,810 | |
Entity Central Index Key | 0001426506 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 2,366,695 | $ 257,768 |
Restricted cash | 920,013 | 858,408 |
Accounts receivable, net of allowance for doubtful accounts of $1,188,705 and $1,041,387, respectively | 12,573,451 | 11,703,347 |
Prepaid expenses and other current assets | 2,305,775 | 2,162,238 |
Current assets of discontinued operations | 17,435 | 17,446 |
Total current assets | 18,183,369 | 14,999,207 |
Property and equipment, net of accumulated depreciation of $12,619,594 and $11,262,193, respectively | 9,711,817 | 10,463,352 |
Right of use assets - operating lease | 3,198,666 | 3,312,710 |
Other assets | 935,086 | 448,887 |
Other assets of discontinued operations, net | 1,500 | 1,500 |
Total assets | 32,030,438 | 29,225,656 |
Current liabilities: | ||
Accounts payable | 2,301,626 | 3,958,515 |
Accounts payable - related party | 141,318 | 94,602 |
Accrued expenses and other liabilities | 4,105,369 | 4,055,113 |
Current portion of right of use liabilities - operating leases | 933,060 | 816,671 |
Secured line of credit | 9,676,648 | 9,468,759 |
Current portion of unsecured notes payable | 3,348,891 | 1,168,420 |
Current portion of secured notes payable, net | 3,696,887 | 3,527,960 |
Current portion of convertible note, net | 3,443,972 | 1,616,672 |
Current liabilities of discontinued operations | 494,735 | 588,283 |
Total current liabilities | 28,142,506 | 25,294,995 |
Long term liabilities: | ||
Convertible note payable, net | 1,591,690 | 2,620,145 |
Notes payable - secured, net of current portion | 18,850,358 | 14,535,751 |
Right of use liabilities - operating leases, net of current portion | 2,458,598 | 2,545,950 |
Long term liabilities of discontinued operations | 357,969 | 381,746 |
Total liabilities | 51,401,121 | 45,378,587 |
Commitments and contingencies | ||
Stockholders' deficit | ||
Common stock - $0.001 par value; 250,000,000 shares authorized; 35,124,810 and 33,731,162 shares issued and outstanding, respectively | 35,125 | 33,732 |
Additional paid in capital | 17,257,858 | 16,845,873 |
Accumulated deficit | (36,663,666) | (33,032,536) |
Total stockholders' deficit | (19,370,683) | (16,152,931) |
Total liabilities and stockholders' deficit | 32,030,438 | 29,225,656 |
Series B preferred stock [Member] | ||
Stockholders' deficit | ||
Preferred stock | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Allowance for doubtful accounts | $ 1,188,705 | $ 1,041,387 |
Property and equipment, net of accumulated depreciation | $ 12,619,594 | $ 11,262,193 |
Preferred stock shares authorized | 1,000,000 | 1,000,000 |
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 |
Number of shares authorized | 250,000,000 | 250,000,000 |
Common stock share issued | 35,124,810 | 33,731,162 |
Common stock shares outstanding | 35,124,810 | 33,731,162 |
Series A preferred stock [Member] | ||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock shares authorized | 2,000 | 2,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Series B preferred stock [Member] | ||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock shares authorized | 6,000 | 6,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
REVENUES | $ 16,181,053 | $ 7,602,328 |
COST OF REVENUES | 14,725,105 | 8,700,508 |
GROSS PROFIT (LOSS) | 1,455,948 | (1,098,180) |
OPERATING EXPENSES: | ||
Selling, general and administrative | 2,463,881 | 1,512,400 |
Total operating expenses | 2,463,881 | 1,512,400 |
LOSS FROM OPERATIONS | (1,007,933) | (2,610,580) |
OTHER INCOME (EXPENSE) | ||
Interest expense, net | (2,619,037) | (1,248,789) |
Other expense | (9,048) | |
Other income, net | 639 | |
Gain on sale of assets | 0 | 50,162 |
Total other income (expense) | (2,628,085) | (1,197,988) |
NET LOSS FROM CONTINUING OPERATIONS | (3,636,018) | (3,808,568) |
Income (loss) from discontinued operations | 4,888 | (56,455) |
NET LOSS | (3,631,130) | (3,865,023) |
Preferred stock dividends | (25,000) | |
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ (3,631,130) | $ (3,890,023) |
Net loss per common share - Basic and diluted | ||
Continuing operations Basic | $ (0.11) | $ (0.20) |
Continuing operations Diluted | (0.11) | (0.20) |
Discontinued operations Basic | 0 | 0 |
Discontinued operations Diluted | 0 | |
Net loss attributable to common shareholders Basic | (0.11) | (0.20) |
Net loss attributable to common shareholders Diluted | $ (0.11) | $ (0.20) |
Weighted average common shares outstanding | ||
Basic (in shares) | 34,311,688 | 19,516,258 |
Diluted (in shares) | 34,311,688 | 19,516,258 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) | Series A preferred stock [Member] | Common stock [Member] | Additional Paid-In Capital [Member] | Accumulate Deficit [Member] | Total |
Beginning balance at Dec. 31, 2020 | $ 2 | $ 19,447 | $ 10,978,254 | $ (21,815,556) | $ (10,817,853) |
Beginning balance (in shares) at Dec. 31, 2020 | 2,000 | 19,446,258 | |||
Shares issued with debt and beneficial conversion feature on convertible notes payable | $ 393 | 174,658 | 175,051 | ||
Shares issued with debt and beneficial conversion feature on convertible notes payable (in shares) | 393,107 | ||||
Share based compensation | 17,973 | 17,973 | |||
Preferred stock dividends | (25,000) | (25,000) | |||
Net loss | (3,865,023) | (3,865,023) | |||
Ending balance at Mar. 31, 2021 | $ 2 | $ 19,840 | 11,170,885 | (25,705,579) | (14,514,852) |
Ending balance (in shares) at Mar. 31, 2021 | 2,000 | 19,839,365 | |||
Beginning balance at Dec. 31, 2021 | $ 0 | $ 33,732 | 16,845,873 | (33,032,536) | (16,152,931) |
Beginning balance (in shares) at Dec. 31, 2021 | 0 | 33,731,162 | |||
Shares issued as deferred finance cost on promissory notes | $ 0 | $ 1,393 | 396,380 | 0 | 397,773 |
Shares issued as deferred finance cost on promissory notes (in shares) | 1,393,648 | ||||
Share based compensation | 15,605 | 15,605 | |||
Net loss | (3,631,130) | (3,631,130) | |||
Ending balance at Mar. 31, 2022 | $ 35,125 | $ 17,257,858 | $ (36,663,666) | $ (19,370,683) | |
Ending balance (in shares) at Mar. 31, 2022 | 35,124,810 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (3,636,018) | $ (3,808,568) |
Adjustments to reconcile net loss from continuing operations to net cash used in operating activities: | ||
Stock based compensation | 15,605 | 17,973 |
Depreciation and amortization | 1,357,401 | 1,418,401 |
Amortization of deferred financing costs | 1,497,032 | 245,722 |
Amortization of right of use assets - operating leases | 114,044 | 88,589 |
Bad debt expense (recovery) | 153,801 | (14,353) |
Gain on sale of assets | (50,162) | |
Changes in: | ||
Accounts receivable | (1,023,905) | (1,389,592) |
Prepaid expenses and other current assets | 1,484,614 | 1,251,779 |
Other assets | (598,625) | (585,574) |
Accounts payable | (1,656,889) | (118,594) |
Accounts payable - related party | 46,716 | (59,918) |
Accrued expenses and other liabilities | 50,256 | 1,438,162 |
Right of use operating lease liabilities | 29,037 | (19,688) |
Net cash used in operating activities from continuing operations | (2,166,931) | (1,585,823) |
Net cash provided by operating activities from discontinued operations | 530,013 | |
Net cash used in operating activities | (2,166,931) | (1,055,810) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Cash paid for disposal of MG Cleaners, LLC | (35,000) | |
Cash paid for purchase of property and equipment | (37,022) | |
Net cash used in investing activities from continuing operations | (37,022) | (35,000) |
Net cash used in investing activities | (37,022) | (35,000) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from secured line of credit, net | 180,830 | |
Payments on secured line of credit, net | (354,214) | |
Proceeds from notes payable | 5,229,098 | 1,874,002 |
Payments on notes payable | (1,035,443) | (338,001) |
Proceeds from convertible notes payable | 150,000 | |
Net cash provided by financing activities from continuing operations | 4,374,485 | 1,331,787 |
Net cash used in financing activities from discontinued operations | (150,173) | |
Net cash provided by financing activities | 4,374,485 | 1,181,614 |
NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 2,170,532 | 90,804 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period | 1,116,176 | 979,088 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period | 3,286,708 | 1,069,892 |
Supplemental disclosures: | ||
Cash paid for interest | 1,144,694 | 528,909 |
Noncash investing and financing activities | ||
Prepaid expenses financed with note payable | 1,353,151 | 1,179,752 |
Preferred stock dividend | 25,000 | |
Shares issued for deferred financing costs | 397,773 | |
Note receivable for property and equipment | 275,000 | 17,293 |
Beneficial conversion feature on convertible notes payable | 175,051 | |
Non-cash consideration in convertible notes payable | $ 112,071 | |
Equipment financed with note payable | $ 843,844 |
BACKGROUND AND BASIS OF PRESENT
BACKGROUND AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2022 | |
BACKGROUND AND BASIS OF PRESENTATION | |
BACKGROUND AND BASIS OF PRESENTATION | NOTE 1 ā BACKGROUND AND BASIS OF PRESENTATION SMG Industries Inc. (āweā, āourā, the āCompanyā or āSMGā) is a corporation established pursuant to the laws of the State of Delaware on January 7, 2008. The Companyās original business was the acquisition and stockpile of a rare metal known as Indium used in cell phones and other industrial applications. The Company eventually sold its stockpile and distributed most of the proceeds to its stockholders via special dividends and share repurchases. ā The Company today is a growth-oriented midstream, logistics and oilfield services company that operates throughout the domestic Southwest United States. Through its wholly-owned operating subsidiaries, the Company offers an expanding suite of products and services across the oilfield market segments of drilling, completions and production. ā SMG is headquartered in Houston, Texas with facilities in Odessa, Floresville, Henderson, Victoria and Palestine, Texas. ā In March 2020 the World Health Organization declared COVID-19 a pandemic. Throughout 2020 and into 2021, many variants of the virus arose. We are still assessing the impact COVID-19 and related variants (together, āCOVID-19ā) may have on our business, but there can be no assurance that this analysis will enable us to avoid part or all of any impact from the spread of COVID-19 or its consequences, including downturns in business sentiment generally. The extent to which the COVID-19 pandemic and global efforts to contain its spread will impact our operations will depend on future developments, which are highly uncertain and cannot be predicted at this time, and include the duration, severity and scope of the pandemic and the actions taken to contain or treat the COVID-19 pandemic. ā The accompanying unaudited interim consolidated financial statements of SMG have been prepared in accordance with accounting principles generally accepted in the United States of America and should be read in conjunction with the audited consolidated financial statements and notes thereto for the years ended December 31, 2021 and 2020 in the Form 10-K filed on April 15, 2022. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements which would substantially duplicate the disclosures contained in the Form 10-K have been omitted. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 ā SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation ā The Company prepares its consolidated financial statements on the accrual basis of accounting. The accompanying consolidated financial statements include the accounts of the Company and its wholly subsidiaries, 5J Trucking LLC, 5J Oilfield Services LLC, 5J Specialized LLC, 5J Transportation LLC and 5J Brokerage LLC (together referred to as ā5Jā), Momentum Water Transfer Services, LLC (āMWTSā), Jake Oilfield Solutions LLC (āJakeā) and Trinity Services LLC (āTrinityā), all of which have quarter ends of March 31 and fiscal year end of December 31. All intercompany accounts, balances and transactions have been eliminated in the consolidation. Fair Value of Financial Instruments ā The carrying value of short-term instruments, including cash, accounts payable and accrued expenses, and short-term notes approximate fair value due to the relatively short period to maturity for these instruments. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates. ā Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company utilizes a three-level valuation hierarchy for disclosures of fair value measurements, defined as follows: ā Level 1: inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets Level 2: inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ā Level 3: inputs to the valuation methodology are unobservable and significant to the fair value ā The Company does not have any assets or liabilities that are required to be measured and recorded at fair value on a recurring basis. ā Discontinued Operations ā In December 2020 we sold MG and decided to cease the operations of Trinity. An entity that is disposed of by sale or ceasing of operations is reported as discontinued operations if the transaction represents a strategic shift that will have a major effect on an entityās operations and financial results. As such, MG and Trinity are reported as discontinued operations. ā Assets and liabilities of the discontinued operations are aggregated and reported separately as assets and liabilities of discontinued operations in the Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021. The results of discontinued operations are aggregated and presented separately in the Consolidated Statements of Operations as net income (loss) from discontinued operations for the three months ended March 31, 2022 and 2021. The cash flows of the discontinued operations are reflected as cash flows of discontinued operations within the Companyās Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021. ā Amounts presented in discontinued operations have been derived from our consolidated financial statements and accounting records using the historical basis of assets, liabilities, results of operations, and cash flows of MG and Trinity. The discontinued operations exclude general corporate allocations. ā Basic and Diluted Net Loss per Share The Company presents both basic and diluted net loss per share on the face of the statements of operations. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted per share calculations give effect to all potentially dilutive shares of common stock outstanding during the period, including stock options and warrants, and using the treasury-stock method for stock options and warrant and the āif convertedā method for convertible notes payable and preferred stock. If anti-dilutive, the effect of potentially dilutive shares of common stock is ignored. For the three months ended March 31, 2022, 1,525,000 of stock options, 1,763,335 of warrants and 79,467,400 shares issuable from convertible notes were considered for their dilutive effects. For the three months ended March 31, 2021, 2,060,000 of stock options, 1,763,335 of warrants, 4,000,000 shares issuable from Series A Preferred Stock and 29,413,660 shares issuable from convertible notes were considered for their dilutive effects. As a result of the Companyās net losses for the three months ended March 31, 2022 and 2021, all potentially dilutive instruments were excluded as their effect would have been anti-dilutive. ā Reclassification ā Certain reclassifications have been made to the prior year financial statements to conform to the current year presentation. ā Recent Accounting Pronouncements ā The Company does not believe that any recently issued effective pronouncements, or pronouncements issued but not yet effective, if adopted, would have a material effect on the accompanying financial statements. |
GOING CONCERN
GOING CONCERN | 3 Months Ended |
Mar. 31, 2022 | |
GOING CONCERN | |
GOING CONCERN | NOTE 3 ā GOING CONCERN The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern and, no adjustments to the consolidated financial statements have been made to account for this uncertainty. The Company concluded that the uncertainty surrounding the COVID-19 global pandemic, its negative working capital, and negative cash flows from operations are conditions that raised substantial doubt about the Companyās ability to continue as a going concern. The Company plans to continue to generate additional revenue (and improve cash flows from operations) in connection with its anticipated growth related to the Companyās February 2020 acquisition of 5J and its expanded revenue lines in heavy haul, super heavy haul, drilling rig mobilization, commodity freight, and brokerage services. |
REVENUE
REVENUE | 3 Months Ended |
Mar. 31, 2022 | |
REVENUE | |
REVENUE | NOTE 4 ā REVENUE Disaggregation of revenue All of the Companyās revenue from continuing operations is currently generated from services. As such no further disaggregation of revenue information is provided. All revenues are currently in the southern region of the United States. ā Customer Concentration and Credit Risk ā During the three months ended March 31, 2022, no customers exceeded 10% of revenue. During the three months ended March 31, 2021, one of our customers accounted for approximately 12% of our total gross revenues. No customer accounted for 10% of accounts receivable as of March 31, 2022 and December 31, 2021. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 3 Months Ended |
Mar. 31, 2022 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | NOTE 5 ā PROPERTY AND EQUIPMENT, NET Property and equipment at March 31, 2022 and December 31, 2021 consisted of the following: ā ā ā ā ā ā ā ā March 31, 2022 December 31, 2021 Equipment ā $ 7,805,619 ā $ 7,768,597 Trucks and trailers ā ā 11,735,845 ā ā 11,167,001 Downhole oil tools ā 659,873 ā 659,873 Vehicles ā 1,538,528 ā 1,538,528 Building ā ā 493,529 ā ā 493,529 Furniture, fixtures and other ā 98,017 ā 98,017 ā ā ā ā ā ā ā Property and equipment, gross ā 22,331,411 ā 21,725,545 ā ā ā ā ā ā ā Less: accumulated depreciation ā (12,619,594) ā (11,262,193) ā ā ā ā ā ā ā Property and equipment, net ā $ 9,711,817 ā $ 10,463,352 ā Depreciation expense for the three months ended March 31, 2022 and 2021 was $1,357,401 and $1,418,401, respectively. |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 3 Months Ended |
Mar. 31, 2022 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
ACCRUED EXPENSES AND OTHER LIABILITIES | NOTE 6 ā ACCRUED EXPENSES AND OTHER LIABILITIES Accrued expenses as of March 31, 2022 and December 31, 2021 included the following: ā ā ā ā ā ā ā ā ā March 31, 2022 December 31, 2021 Payroll and payroll taxes payable ā $ 1,414,195 ā $ 1,929,414 State and local tax payable ā 394,500 ā 422,781 Interest payable ā ā 460,261 ā ā 482,950 Accrued operational expenses ā ā 1,653,883 ā ā 1,006,343 Accrued general and administrative expenses ā ā 100,300 ā ā 178,561 Other ā 82,230 ā 35,064 ā ā ā ā ā ā ā Total Accrued Expenses and Other Liabilities ā $ 4,105,369 ā $ 4,055,113 ā |
NOTES PAYABLE
NOTES PAYABLE | 3 Months Ended |
Mar. 31, 2022 | |
NOTES PAYABLE. | |
NOTES PAYABLE | NOTE 7 ā NOTES PAYABLE Notes payable included the following as of March 31, 2022 and December 31, 2021: ā ā ā ā ā ā ā ā ā March 31, December 31, ā ā 2022 ā 2021 Secured notes payable: ā ā ā ā ā ā ā ā ā Secured note payable issued December 7, 2018 to a shareholder, bearing interest of 10% per year, due one year after issuance. On March 6, 2020, the note was extended to June 30, 2020. Note is currently past due. If a default notice is received the interest rate will be 14% ā $ 100,000 ā $ 100,000 ā ā ā ā ā ā ā Secured note payable issued December 7, 2018 to a shareholder, bearing interest of 10% per year, due one year after issuance. On March 6, 2020, the note was extended to June 30, 2020. Note is currently past due. If a default notice is received the interest rate will be 14%. ā 100,000 ā 100,000 ā ā ā ā ā ā ā Secured note payable issued December 7, 2018, bearing interest of 10% per year, due one year after issuance. Note is currently past due. If a default notice is received, the interest rate will be 14%. ā 100,000 ā 100,000 ā ā ā ā ā ā ā Secured note payable issued on December 7, 2018 related to the acquisition of MWTS, bearing interest of 6% per year and due in monthly installments of $7,500, with a maturity date of December 8, 2023. ā 792,470 ā 792,470 ā ā ā ā ā ā ā Secured note payable issued May 1, 2019 to a shareholder, bearing interest of 10% per year, due July 1, 2019, principal balance $100,000. Note was extended to March 30, 2020. Note is currently past due. If a default notice is received the interest rate will be 14%. ā 100,000 ā 100,000 ā ā ā ā ā ā ā Secured note payable issued June 17, 2019 to a shareholder, bearing interest of 10% per year, due June 30, 2020. Note is currently past due. If a default notice is received, the interest rate will be 14%. ā 80,000 ā 80,000 ā ā ā ā ā ā Secured note payable with a related party issued February 27, 2020 in connection with the 5J acquisition, bearing interest of 10% per year, due February 1, 2023. ā 2,000,000 ā 2,000,000 ā ā ā ā ā ā ā Various notes payable secured by equipment of 5J Trucking, LLC, bearing interest ranging from 5.32% to 5.5% maturing from January 2023 through March 2023. ā ā 267,509 ā ā 343,723 ā ā ā ā ā ā ā Secured note payable with a related party issued on February 27, 2020, bearing interest of 10.0% per year, due March 1, 2023. ā ā 428,253 ā ā 545,050 ā ā ā ā ā ā ā Secured promissory notes for Jake, SMG Industries, Inc, and 5J Trucking LLC, with Small Business Administration Economic Injury Disaster Loans, bearing interest 3.75% annually and matures in June, August, and September 2050. ā 390,000 ā 390,000 ā ā ā ā ā ā ā Secured promissory note issued on June 20, 2020. The note is due and payable in thirty-six monthly installments of $45,585 commencing on July 20, 2020 and the final installment is due on July 1, 2023. Unamortized deferred financing costs associated with this agreement were $287,560 as of March 31, 2022. ā ā 998,388 ā ā 1,071,821 ā ā ā ā ā ā ā Secured promissory note issued on January 27, 2022. The note is due on May 1, 2026 and secured by machinery and equipment owned by the Company. The Company paid an initial installment of $95,025, with monthly payments of approximately $15,275 per month beginning in June 2022 through maturity. ā ā 738,185 ā ā ā ā ā ā ā ā ā ā Secured promissory note with Amerisource, a related party, issued on September 7, 2021 in the amount of $12,740,000, bearing interest at 12%, maturing September 7, 2026. The Company is required to make monthly payments of interest only beginning October 1, 2021, with payments of principal and interest beginning in October 2022. On March 15, 2022, the Company entered into an agreement with Amerisource, to amend the Loan Agreement dated September 7, 2021, pursuant to which Amerisource agreed to increase the loan commitment to the Company from $12,740,000 to $16,740,000. ā ā 16,740,000 ā ā 12,740,000 ā ā 22,834,805 ā 18,363,064 Less discounts and deferred finance costs ā (287,560) ā (299,353) Less current maturities ā (3,696,887) ā (3,527,960) ā ā ā ā ā ā ā Long term secured notes payable, net of current maturities and discounts ā $ 18,850,358 ā $ 14,535,751 ā On January 27, 2022, the Company issued a secured promissory note for $843,844, which includes precomputed interest of $147,818. The note is due on May 1, 2026 and secured by machinery and equipment owned by the Company. The Company paid an initial installment of $95,025 plus an additional $10,634 payment, with monthly payments of approximately $15,275 per month beginning in June 2022 through maturity. On March 15, 2022, each of our 5J subsidiaries entered into an agreement with Amerisource Funding Inc. (āAmerisourceā), our senior lender, to amend the Loan Agreement dated September 7, 2021, pursuant to which Amerisource agreed to increase the loan commitment to the 5J entities from $12,740,000 to $16,740,000. The Company received $4,000,000 of cash proceeds from this agreement. The Company amortized total debt discount of $11,793 related to secured notes payable during the three months ended March 31, 2022. Notes Payable ā Unsecured ā ā ā ā ā ā ā ā ā March 31, December 31, ā ā 2022 ā 2021 Insurance premium financing note with original principal of $1,353,151, monthly payments of $138,285, with stated interest of 4.76%, maturing on December 1, 2022. ā $ 1,214,867 ā $ ā ā ā ā ā ā ā ā Insurance premium financing note with original principal of $1,487,202, monthly payments of $153,537, with stated interest of 6.99%, maturing on May 1, 2022. ā 297,400 ā 743,576 ā ā ā ā ā ā ā Insurance premium financing note with original principal of $292,065, monthly payments of $7,793, with stated interest of 5.78%, maturing on February 14, 2022. ā ā ā 58,413 ā ā ā ā ā ā ā Unsecured note payable with a shareholder. Note issued on August 10, 2018 for $40,000, due December 30, 2018 (extended to June 30, 2020) and 10% interest per year, balance of payable is due on demand. Additional $25,000 advanced and due on demand. Note is currently past due. If a default notice is received, the interest rate will be 15%. ā ā 44,559 ā ā 44,559 ā ā ā ā ā ā ā Unsecure advances from the sellers of MWTS, non-interest bearing and due on demand ā ā 35,000 ā ā 35,000 ā ā ā ā ā ā ā Unsecured payable for settlement of lawsuit with an original settlement of $196,188, monthly payments of $6,822 for 24 months, with an interest rate of 6% and a default interest rate of 18%. ā ā 77,967 ā ā 98,433 ā ā ā ā ā ā ā Unsecured note payable with a shareholder, a related party. Note issued on December 22, 2021 for $150,000, due January 31, 2022 and 12% interest per year. During the three months ended March 31, 2022, an additional $895,025 was loaned by the shareholder, related party. ā ā 1,045,025 ā ā 150,000 ā ā ā ā ā ā ā Unsecured note payable with a shareholder, a related party. Note issued on December 22, 2021 for $150,000, due January 31, 2022 and 12% interest per year. On January 6, 2022, the shareholder, related party, loaned the Company an additional $100,000. This note is currently past due. ā ā 250,000 ā ā 150,000 ā ā ā ā ā ā ā Unsecured note payable with a shareholder. Note issued on December 22, 2021 for $150,000, due January 31, 2022 and 12% interest per year. On January 6, 2022, the shareholder, loaned the Company an additional $100,000. This note is currently past due. ā ā 250,000 ā ā 150,000 ā ā ā ā ā ā ā Unsecured note payable with a shareholder, a related party. Note issued on February 14, 2022 for $134,073, due March 31, 2022 and 12% interest per year. This note is currently past due. ā ā 134,073 ā ā ā ā ā ā ā ā ā ā Notes payable - unsecured ā ā 3,348,891 ā ā 1,429,981 Less discounts and deferred finance costs ā ā ā ā ā (261,561) Less current portion ā (3,348,891) ā (1,168,420) ā ā ā ā ā ā ā Notes payable - unsecured, net of current portion ā $ ā ā $ ā ā On January 6, 2022, Newton Dorsett, a member of our board of directors, loaned us $100,000 pursuant to a short term bridge note, that along with the initial loan to us in December 2021 of $150,000, totals $250,000. This bridge note matured on January 31, 2022, and pays a 12% per annum interest rate. On January 6, 2022, Grey Fox Investments which is controlled by Brady Crosswell, a member of our board of directors, loaned us $100,000 pursuant to a short term bridge note, that along with the loan to us in December 2021 of $150,000, totals $250,000. This bridge note matured on January 31, 2022, and pays a 12% per annum interest rate On January 7, 2022, Mr. Madden loaned us $100,000 pursuant to short term bridge note, that along with the initial loan to us in December 2021 of $150,000, totals $250,000. This bridge note matured on January 31, 2022 and pays a 12% per annum interest rate. On February 11, 2022, Mr. Madden loaned us $95,025 pursuant to a short term bridge note that matured on March 31, 2022. Mr. Madden also received 142,538 shares issued in the first quarter 2022 as an equity incentive in connection with this note. On February 14, 2022, Mr. Madden loaned us $250,000 pursuant to a short term bridge note that matured on March 31, 2022. Mr. Madden also received 375,000 shares issued in the first quarter 2022 as an equity incentive in connection with this note. On February 14, 2022, James Frye, a member of our board of directors, loaned us $134,073 pursuant to a short term bridge note that matures on March 31, 2022. Mr. Frye also received 201,110 shares issued in the first quarter 2022 as an equity incentive in connection with this note. On March 3, 2022, Mr. Madden loaned us $450,000 pursuant to a short term bridge note that matured on March 31, 2022. Mr. Madden also received 675,000 shares issued in the first quarter 2022 as an equity incentive in connection with this note. The Company amortized total debt discount of $659,335 related to unsecured notes payable during the three months ended March 31, 2022. Accounts Receivable Financing Facility (Secured Line of Credit) On February 27, 2020, the 5J Entities entered into a Revolving Accounts Receivable Assignment and Term Loan Financing and Security Agreement with Amerisource Funding Inc. (āAmerisourceā) in the aggregate amount of $10,000,000 (āAmerisource Financingā).The Amerisource Financing provides for: (i) an equipment loan in the principal amount of $1,401,559 (āAmerisource Equipment Loanā), (ii) a bridge term facility in the amount of $550,690 (āBridge Facilityā), and (iii) an accounts receivable revolving line of credit up to $10,000,000 (āAR Facilityā). The Company recorded deferred financing costs of $223,558 recognized on the date of incurrence as a discount. During the three months ended March 31, 2022, $27,059 of debt discount was amortized to interest expense, and unamortized discount was $1,369 as of March 31, 2022. Amerisource is a related party of the Company due to its holdings of common stock and convertible debt of the Company and has an officer on the Board of Directors of the Company. ā The AR Facility has been issued in an amount not to exceed $10,000,000, with the maximum availability limited to 90% of the eligible accounts receivable (as defined in the financing agreement). The AR Facility is paid for by the assignment of the accounts receivable of each of the 5J Entities and is secured by all instruments and proceeds related thereto. The AR Facility has an interest rate of 4.5% in excess of the prime rate per annum, an initial collateral management fee of 0.75% of the maximum account limit per annum, a non-usage fee of 0.35% assessed on a quarterly basis on the difference between the maximum availability under the AR Facility and the average daily revolving loan balance outstanding, and a one-time commitment fee equal to $100,000 paid at closing. The AR Facility can be terminated by the 5J Entities with 60 days written notice. There is an early termination fee equal to two percent (2.0)% of the then maximum account limit if there are more than twelve (12) months remaining in term of the AR Facility, or one percent (1.0)% of the then maximum account limit if there twelve months or less remaining in the term of the AR Facility. The Company is a guarantor of the Amerisource Financing. ā The balances under the above lines of credit were $9,676,648 and $9,468,759 as of March 31, 2022 and December 31, 2021, respectively. Convertible Notes Payable On February 27, 2020, the Company entered into a loan agreement with Amerisource Leasing Corporation, which has an equity ownership of 13.9% and is considered a related party, for the sale of a 10% convertible promissory note in the principal amount of $1,600,000 (āAmerisource Stretch Noteā). The Amerisource Stretch Note matures on February 27, 2023 and is convertible into shares of the Companyās common stock at a conversion price of $0.25 per share. The interest rate on the Amerisource Stretch Note increases to 11% per annum on February 27, 2021 and to 12% per annum on February 27, 2022. Interest shall be paid on a quarterly basis. The Amerisource Stretch Note may be prepaid at any time by the Company on 10 days-notice to the noteholder without penalty. In addition, 2,498,736 shares of the Companyās common stock with a fair value of $419,788 were issued to the noteholder in connection with the sale of the Amerisource Note. The Company recorded deferred financing costs of $419,788 recognized on the date of incurrence as a discount and will be amortized over the life of the loan. During the three months ended March 31, 2022, $34,982 of debt discount was amortized to interest expense, and there was $116,608 of unamortized discount as of March 31, 2022. As of March 31, 2022 and December 31, 2021, the outstanding principal balance was $1,600,000. During the three months ended March 31, 2022, $798,845 of debt discount was amortized to interest expense, and there was $3,871,373 of unamortized discount as of March 31, 2022. ā Of the $8,907,035 principal amount outstanding, $7,906,740 of the Convertible Notes are held by investors who are considered related parties, primarily existing debt holders. ā As of March 31, 2022, the convertible notes, net balance was $5,035,662 which long term convertible notes payable of $1,591,690 and current portion of convertible notes of $3,443,972. As of December 31, 2021, the convertible notes, net balance was $4,236,817 which long term convertible notes payable of $2,620,145 and current portion of convertible notes of $1,616,672. ā Future maturities of all the Companyās debt as of March 31, 2022 are as follows: ā ā ā ā ā 2022 $ 20,604,868 2023 ā 9,428,850 2024 ā 3,831,511 2025 ā 3,644,580 2026 ā 7,046,990 Thereafter ā ā 211,951 Total ā $ 44,768,750 ā |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 3 Months Ended |
Mar. 31, 2022 | |
STOCKHOLDERS' DEFICIT | |
STOCKHOLDERS' DEFICIT | NOTE 8 ā STOCKHOLDERSā DEFICIT During the three months ended March 31, 2022, the Company issued a total of 1,393,648 shares of common stock to two lenders in connection with unsecured notes payable. These shares had a fair value of $397,773 and were recorded as deferred finance costs. |
STOCK OPTIONS AND WARRANTS
STOCK OPTIONS AND WARRANTS | 3 Months Ended |
Mar. 31, 2022 | |
STOCK OPTIONS AND WARRANTS | |
STOCK OPTIONS AND WARRANTS | NOTE 9 ā STOCK OPTIONS AND WARRANTS Summary stock option information is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Aggregate ā ā Weighted ā ā Aggregate ā Exercise ā Exercise ā Average ā ā Number ā Price ā Price Range ā Exercise Price Outstanding, December 31, 2021 1,575,000 ā $ 561,250 ā $ 0.25-0.75 ā $ 0.36 Granted ā ā ā ā ā ā ā ā ā Exercised ā ā ā ā ā ā ā ā Cancelled, forfeited or expired (50,000) ā (15,000) ā $ 0.30 ā $ 0.30 Outstanding, March 31, 2022 1,525,000 ā $ 546,250 ā $ 0.25-0.75 ā $ 0.36 Exercisable, March 31, 2022 1,186,111 ā $ 444,583 ā $ 0.25-0.75 ā $ 0.37 ā The weighted average remaining contractual life is approximately 2.61 years for stock options outstanding on March 31, 2022. At March 31, 2022, there was no intrinsic value to the outstanding stock options. ā Summary Stock warrant information is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Aggregate ā ā Weighted ā ā Aggregate ā Exercise ā Exercise ā Average ā ā Number ā Price ā Price Range ā Exercise Price Outstanding, December 31, 2021 1,763,335 $ 496,667 ā $ 0.15-$0.75 ā $ 0.28 Granted ā ā ā ā ā ā ā ā ā Exercised ā ā ā ā ā ā ā ā Cancelled, forfeited or expired ā ā ā ā ā ā ā ā Outstanding, March 31, 2022 1,763,335 ā $ 496,667 ā $ 0.15 - 0.75 ā $ 0.28 Exercisable, March 31, 2022 1,763,335 ā $ 496,667 ā $ 0.15 - 0.75 ā $ 0.28 ā The weighted average remaining contractual life is approximately 4.85 years for stock warrants outstanding on March 31, 2022. At March 31, 2022 the outstanding stock warrants had an aggregate intrinsic value of $16,750. |
DISPOSITION OF BUSINESSES
DISPOSITION OF BUSINESSES | 3 Months Ended |
Mar. 31, 2022 | |
DISPOSITION OF BUSINESSES | |
DISPOSITION OF BUSINESSES | NOTE 10 ā DISPOSITION OF BUSINESSES Trinity Services LLC In December 2020, management decided to sell or dissolve Trinity. All assets and liabilities of Trinity are classified as assets and liabilities of discontinued operations and included within net income (loss) from discontinued operations. All of Trinityās equipment was sold in the year ended December 31, 2021 at auction through a third party auctioneer. All proceeds are being utilized to retire outstanding Trinity debt. MG Cleaners LLC On December 22, 2020, the Company, as the sole member of MG Cleaners LLC (āMGā), entered into a share exchange agreement (āAgreementā) with S&A Christian Investments L.L.C. (āS&Aā) pursuant to which the Company transferred all of the membership interests of MG (āMG Interestsā) to S&A in exchange for Stephen Christian, the control person of S&A, returning 1,408,276 shares of the Companyās common stock, par value $0.001 per share (āExchanged Sharesā) to the Company for cancellation, additional In connection with the sale of MG, Mr.Christian resigned as Executive Vice President and Secretary of the Company. The Company also agreed to pay $150,000 in cash to MG Cleaners, with $75,000 paid in December 2020. The remaining $75,000 was satisfied with a $40,000 sale of equipment and payment of $35,000 to MG Cleaners in February 2021. ā The decision to sell Trinity assets and the MG sale agreement qualify as discontinued operations in accordance with U.S. GAAP, as each represents a significant strategic shift of the Companyās operations that will have a major effect on the Companyās operations. As a result, the Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021 present the assets and liabilities of Trinity and MG as assets and liabilities of discontinued operations. The Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021 present the results of Trinity and MG as Loss from discontinued operations. The Consolidated Statements of Cash Flows for the three months end March 31, 2022 and 2021 present operating, investing, and financing activities of Trinity and MG as cash flows from or used in discontinued operations. ā The balance sheets of Trinity and MG combined are summarized below: ā ā ā ā ā ā ā ā ā March 31, December 31, ā ā 2022 ā 2021 Cash and cash equivalents ā $ ā ā $ 11 Accounts receivable, net ā 17,011 ā 17,011 Prepaid expenses and other current assets ā 424 ā 424 Current assets of discontinued operations ā 17,435 ā 17,446 Other assets ā 1,500 ā 1,500 Other assets of discontinued operations ā 1,500 ā 1,500 Total assets of discontinued operations ā $ 18,935 ā $ 18,946 Accounts payable ā $ 242,111 ā $ 400,659 Accrued expenses and other liabilities ā 252,624 ā 187,624 Current liabilities of discontinued operations ā 494,735 ā 588,283 Notes payable - secured, net of current portion ā 150,000 ā 150,000 Notes payable - unsecured, net of current portion ā 207,969 ā 231,746 Long term liabilities of discontinued operations ā 357,969 ā 381,746 Total liabilities of discontinued operations ā $ 852,704 ā $ 970,029 ā The statements of operations of Trinity and MG combined are summarized below: ā ā ā ā ā ā ā ā ā Three months ended ā ā March 31, ā March 31, ā ā 2022 ā 2021 Revenues ā $ ā ā $ 104,440 Cost of revenues ā ā ā (173,542) Selling, general and administrative ā ā ā (141,699) Loss from operations ā ā ā (210,801) Gain on extinguishment of debt ā ā ā 196,469 Other income (expense) ā 7,749 ā (2,913) Interest expense, net ā (2,861) ā (39,210) Net income (loss) from discontinued operations ā $ 4,888 ā $ (56,455) ā |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES. | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 ā COMMITMENTS AND CONTINGENCIES As of March 31, 2022, the Company has an open letter of credit in the amount of $414,638 as collateral for its insurance policy. ā Litigation During the year ended December 31, 2021, 5J Trucking LLC and James E. Frye entered into a settlement and release agreement with a third party equipment provider to settle outstanding claims by the provider. The Company agreed to pay a total of $196,188 to settle outstanding accounts payable, with $50,000 due upon execution and 24 monthly payments of $6,822. The Company recorded the liability as an unsecured note payable, as described in Note 7, which has a balance of $77,967 as of March 31, 2022. From time to time, SMG may be subject to routine litigation, claims, or disputes in the ordinary course of business. In the opinion of management, no pending or known threatened claims, actions or proceedings against SMG are expected to have a material adverse effect on SMGās financial position, results of operations or cash flows. SMG cannot predict with certainty, however, the outcome or effect of any of the litigation or investigatory matters specifically described above or any other pending litigation or claims. There can be no assurance as to the ultimate outcome of any lawsuits and investigations. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2022 | |
LEASES | |
LEASES | NOTE 12 ā LEASES The Company has operating and finance leases for sales and administrative offices, motor vehicles and certain machinery and equipment. The Companyās leases have remaining lease terms of 1 year to 4 years. For purposes of calculating operating lease liabilities, lease terms may may ā The components of lease cost for operating leases for the three months ended March 31, 2022 and 2021 were as follows: ā ā ā ā ā ā ā ā ā Three months ended ā ā March 31, 2022 ā March 31, 2021 Operating lease cost ā $ 300,758 ā $ 125,110 Short-term lease cost ā ā 151,021 ā ā 56,598 Total lease cost ā $ 451,779 ā $ 181,708 ā Supplemental cash flow information related to leases was as follows: ā ā ā ā ā ā ā ā ā Three Months Ended Three Months Ended ā ā March 31, 2022 ā March 31, 2021 Other Lease Information ā ā ā ā ā ā Cash paid for amounts included in the measurement of lease liabilities: ā ā ā Operating cash flows from operating leases ā $ 29,037 ā $ 19,688 ā The following table summarizes the lease-related assets and liabilities recorded in the consolidated balance sheets at March 31, 2022 and December 31, 2021: ā ā ā ā ā ā ā ā Lease Position March 31, 2022 December 31, 2021 Operating Leases ā ā Operating lease right-of-use assets ā $ 3,198,666 ā $ 3,312,710 Right of use liability operating lease current portion ā $ 933,060 ā $ 816,671 Right of use liability operating lease long term ā 2,458,598 ā 2,545,950 Total operating lease liabilities ā $ 3,391,658 ā $ 3,362,621 ā The Company utilizes the incremental borrowing rate in determining the present value of lease payments unless the implicit rate is readily determinable. ā ā ā ā ā ā ā Lease Term and Discount Rate March 31, 2022 December 31, 2021 Weighted-average remaining lease term (years) ā ā Operating leases 3.5 ā 3.7 ā Weighted-average discount rate ā ā ā ā Operating leases 11.5 % 10.9 % ā The following table provides the maturities of lease liabilities at March 31, 2022: ā ā ā ā ā ā Operating ā ā Leases 2022 (Nine months remaining) ā $ 1,057,362 2023 ā 1,189,018 2024 ā 952,872 2025 ā 718,375 2026 and thereafter ā 232,764 Total future undiscounted lease payments ā ā 4,150,391 Less: Interest ā (758,733) Present value of lease liabilities ā $ 3,391,658 ā |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2022 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 13 ā RELATED PARTY TRANSACTIONS James E. Frye, who currently serves as a director on our Board and President of our 5J subsidiary and also owns or has control over 5J Properties LLC, an entity that is the lessor to three leases with the Company. These three leases located in Palestine, West Odessa and Floresville Texas all have similar five-year terms with options for renewal. The current monthly rent for these leases During the three months ended March 31, 2022, the Company entered into unsecured notes with related parties totaling approximately $1,129,098 in principal. See Note 7. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of Consolidation | Principles of Consolidation ā The Company prepares its consolidated financial statements on the accrual basis of accounting. The accompanying consolidated financial statements include the accounts of the Company and its wholly subsidiaries, 5J Trucking LLC, 5J Oilfield Services LLC, 5J Specialized LLC, 5J Transportation LLC and 5J Brokerage LLC (together referred to as ā5Jā), Momentum Water Transfer Services, LLC (āMWTSā), Jake Oilfield Solutions LLC (āJakeā) and Trinity Services LLC (āTrinityā), all of which have quarter ends of March 31 and fiscal year end of December 31. All intercompany accounts, balances and transactions have been eliminated in the consolidation. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ā The carrying value of short-term instruments, including cash, accounts payable and accrued expenses, and short-term notes approximate fair value due to the relatively short period to maturity for these instruments. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates. ā Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company utilizes a three-level valuation hierarchy for disclosures of fair value measurements, defined as follows: ā Level 1: inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets Level 2: inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ā Level 3: inputs to the valuation methodology are unobservable and significant to the fair value ā The Company does not have any assets or liabilities that are required to be measured and recorded at fair value on a recurring basis. |
Discontinued Operations | Discontinued Operations ā In December 2020 we sold MG and decided to cease the operations of Trinity. An entity that is disposed of by sale or ceasing of operations is reported as discontinued operations if the transaction represents a strategic shift that will have a major effect on an entityās operations and financial results. As such, MG and Trinity are reported as discontinued operations. ā Assets and liabilities of the discontinued operations are aggregated and reported separately as assets and liabilities of discontinued operations in the Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021. The results of discontinued operations are aggregated and presented separately in the Consolidated Statements of Operations as net income (loss) from discontinued operations for the three months ended March 31, 2022 and 2021. The cash flows of the discontinued operations are reflected as cash flows of discontinued operations within the Companyās Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021. ā Amounts presented in discontinued operations have been derived from our consolidated financial statements and accounting records using the historical basis of assets, liabilities, results of operations, and cash flows of MG and Trinity. The discontinued operations exclude general corporate allocations. |
Basic and Diluted Net Loss per Share | Basic and Diluted Net Loss per Share The Company presents both basic and diluted net loss per share on the face of the statements of operations. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted per share calculations give effect to all potentially dilutive shares of common stock outstanding during the period, including stock options and warrants, and using the treasury-stock method for stock options and warrant and the āif convertedā method for convertible notes payable and preferred stock. If anti-dilutive, the effect of potentially dilutive shares of common stock is ignored. For the three months ended March 31, 2022, 1,525,000 of stock options, 1,763,335 of warrants and 79,467,400 shares issuable from convertible notes were considered for their dilutive effects. For the three months ended March 31, 2021, 2,060,000 of stock options, 1,763,335 of warrants, 4,000,000 shares issuable from Series A Preferred Stock and 29,413,660 shares issuable from convertible notes were considered for their dilutive effects. As a result of the Companyās net losses for the three months ended March 31, 2022 and 2021, all potentially dilutive instruments were excluded as their effect would have been anti-dilutive. ā |
Reclassification | Reclassification ā Certain reclassifications have been made to the prior year financial statements to conform to the current year presentation. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements ā The Company does not believe that any recently issued effective pronouncements, or pronouncements issued but not yet effective, if adopted, would have a material effect on the accompanying financial statements. |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of property and equipment | Property and equipment at March 31, 2022 and December 31, 2021 consisted of the following: ā ā ā ā ā ā ā ā March 31, 2022 December 31, 2021 Equipment ā $ 7,805,619 ā $ 7,768,597 Trucks and trailers ā ā 11,735,845 ā ā 11,167,001 Downhole oil tools ā 659,873 ā 659,873 Vehicles ā 1,538,528 ā 1,538,528 Building ā ā 493,529 ā ā 493,529 Furniture, fixtures and other ā 98,017 ā 98,017 ā ā ā ā ā ā ā Property and equipment, gross ā 22,331,411 ā 21,725,545 ā ā ā ā ā ā ā Less: accumulated depreciation ā (12,619,594) ā (11,262,193) ā ā ā ā ā ā ā Property and equipment, net ā $ 9,711,817 ā $ 10,463,352 |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
Schedule of accrued expenses | Accrued expenses as of March 31, 2022 and December 31, 2021 included the following: ā ā ā ā ā ā ā ā ā March 31, 2022 December 31, 2021 Payroll and payroll taxes payable ā $ 1,414,195 ā $ 1,929,414 State and local tax payable ā 394,500 ā 422,781 Interest payable ā ā 460,261 ā ā 482,950 Accrued operational expenses ā ā 1,653,883 ā ā 1,006,343 Accrued general and administrative expenses ā ā 100,300 ā ā 178,561 Other ā 82,230 ā 35,064 ā ā ā ā ā ā ā Total Accrued Expenses and Other Liabilities ā $ 4,105,369 ā $ 4,055,113 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
NOTES PAYABLE | |
Schedule of notes payable | ā ā ā ā ā ā ā ā ā March 31, December 31, ā ā 2022 ā 2021 Secured notes payable: ā ā ā ā ā ā ā ā ā Secured note payable issued December 7, 2018 to a shareholder, bearing interest of 10% per year, due one year after issuance. On March 6, 2020, the note was extended to June 30, 2020. Note is currently past due. If a default notice is received the interest rate will be 14% ā $ 100,000 ā $ 100,000 ā ā ā ā ā ā ā Secured note payable issued December 7, 2018 to a shareholder, bearing interest of 10% per year, due one year after issuance. On March 6, 2020, the note was extended to June 30, 2020. Note is currently past due. If a default notice is received the interest rate will be 14%. ā 100,000 ā 100,000 ā ā ā ā ā ā ā Secured note payable issued December 7, 2018, bearing interest of 10% per year, due one year after issuance. Note is currently past due. If a default notice is received, the interest rate will be 14%. ā 100,000 ā 100,000 ā ā ā ā ā ā ā Secured note payable issued on December 7, 2018 related to the acquisition of MWTS, bearing interest of 6% per year and due in monthly installments of $7,500, with a maturity date of December 8, 2023. ā 792,470 ā 792,470 ā ā ā ā ā ā ā Secured note payable issued May 1, 2019 to a shareholder, bearing interest of 10% per year, due July 1, 2019, principal balance $100,000. Note was extended to March 30, 2020. Note is currently past due. If a default notice is received the interest rate will be 14%. ā 100,000 ā 100,000 ā ā ā ā ā ā ā Secured note payable issued June 17, 2019 to a shareholder, bearing interest of 10% per year, due June 30, 2020. Note is currently past due. If a default notice is received, the interest rate will be 14%. ā 80,000 ā 80,000 ā ā ā ā ā ā Secured note payable with a related party issued February 27, 2020 in connection with the 5J acquisition, bearing interest of 10% per year, due February 1, 2023. ā 2,000,000 ā 2,000,000 ā ā ā ā ā ā ā Various notes payable secured by equipment of 5J Trucking, LLC, bearing interest ranging from 5.32% to 5.5% maturing from January 2023 through March 2023. ā ā 267,509 ā ā 343,723 ā ā ā ā ā ā ā Secured note payable with a related party issued on February 27, 2020, bearing interest of 10.0% per year, due March 1, 2023. ā ā 428,253 ā ā 545,050 ā ā ā ā ā ā ā Secured promissory notes for Jake, SMG Industries, Inc, and 5J Trucking LLC, with Small Business Administration Economic Injury Disaster Loans, bearing interest 3.75% annually and matures in June, August, and September 2050. ā 390,000 ā 390,000 ā ā ā ā ā ā ā Secured promissory note issued on June 20, 2020. The note is due and payable in thirty-six monthly installments of $45,585 commencing on July 20, 2020 and the final installment is due on July 1, 2023. Unamortized deferred financing costs associated with this agreement were $287,560 as of March 31, 2022. ā ā 998,388 ā ā 1,071,821 ā ā ā ā ā ā ā Secured promissory note issued on January 27, 2022. The note is due on May 1, 2026 and secured by machinery and equipment owned by the Company. The Company paid an initial installment of $95,025, with monthly payments of approximately $15,275 per month beginning in June 2022 through maturity. ā ā 738,185 ā ā ā ā ā ā ā ā ā ā Secured promissory note with Amerisource, a related party, issued on September 7, 2021 in the amount of $12,740,000, bearing interest at 12%, maturing September 7, 2026. The Company is required to make monthly payments of interest only beginning October 1, 2021, with payments of principal and interest beginning in October 2022. On March 15, 2022, the Company entered into an agreement with Amerisource, to amend the Loan Agreement dated September 7, 2021, pursuant to which Amerisource agreed to increase the loan commitment to the Company from $12,740,000 to $16,740,000. ā ā 16,740,000 ā ā 12,740,000 ā ā 22,834,805 ā 18,363,064 Less discounts and deferred finance costs ā (287,560) ā (299,353) Less current maturities ā (3,696,887) ā (3,527,960) ā ā ā ā ā ā ā Long term secured notes payable, net of current maturities and discounts ā $ 18,850,358 ā $ 14,535,751 |
Summary of future maturities of all the Company's debt | Future maturities of all the Companyās debt as of March 31, 2022 are as follows: ā ā ā ā ā 2022 $ 20,604,868 2023 ā 9,428,850 2024 ā 3,831,511 2025 ā 3,644,580 2026 ā 7,046,990 Thereafter ā ā 211,951 Total ā $ 44,768,750 |
Unsecured Debt [Member] | |
NOTES PAYABLE | |
Schedule of notes payable | Notes Payable ā Unsecured ā ā ā ā ā ā ā ā ā March 31, December 31, ā ā 2022 ā 2021 Insurance premium financing note with original principal of $1,353,151, monthly payments of $138,285, with stated interest of 4.76%, maturing on December 1, 2022. ā $ 1,214,867 ā $ ā ā ā ā ā ā ā ā Insurance premium financing note with original principal of $1,487,202, monthly payments of $153,537, with stated interest of 6.99%, maturing on May 1, 2022. ā 297,400 ā 743,576 ā ā ā ā ā ā ā Insurance premium financing note with original principal of $292,065, monthly payments of $7,793, with stated interest of 5.78%, maturing on February 14, 2022. ā ā ā 58,413 ā ā ā ā ā ā ā Unsecured note payable with a shareholder. Note issued on August 10, 2018 for $40,000, due December 30, 2018 (extended to June 30, 2020) and 10% interest per year, balance of payable is due on demand. Additional $25,000 advanced and due on demand. Note is currently past due. If a default notice is received, the interest rate will be 15%. ā ā 44,559 ā ā 44,559 ā ā ā ā ā ā ā Unsecure advances from the sellers of MWTS, non-interest bearing and due on demand ā ā 35,000 ā ā 35,000 ā ā ā ā ā ā ā Unsecured payable for settlement of lawsuit with an original settlement of $196,188, monthly payments of $6,822 for 24 months, with an interest rate of 6% and a default interest rate of 18%. ā ā 77,967 ā ā 98,433 ā ā ā ā ā ā ā Unsecured note payable with a shareholder, a related party. Note issued on December 22, 2021 for $150,000, due January 31, 2022 and 12% interest per year. During the three months ended March 31, 2022, an additional $895,025 was loaned by the shareholder, related party. ā ā 1,045,025 ā ā 150,000 ā ā ā ā ā ā ā Unsecured note payable with a shareholder, a related party. Note issued on December 22, 2021 for $150,000, due January 31, 2022 and 12% interest per year. On January 6, 2022, the shareholder, related party, loaned the Company an additional $100,000. This note is currently past due. ā ā 250,000 ā ā 150,000 ā ā ā ā ā ā ā Unsecured note payable with a shareholder. Note issued on December 22, 2021 for $150,000, due January 31, 2022 and 12% interest per year. On January 6, 2022, the shareholder, loaned the Company an additional $100,000. This note is currently past due. ā ā 250,000 ā ā 150,000 ā ā ā ā ā ā ā Unsecured note payable with a shareholder, a related party. Note issued on February 14, 2022 for $134,073, due March 31, 2022 and 12% interest per year. This note is currently past due. ā ā 134,073 ā ā ā ā ā ā ā ā ā ā Notes payable - unsecured ā ā 3,348,891 ā ā 1,429,981 Less discounts and deferred finance costs ā ā ā ā ā (261,561) Less current portion ā (3,348,891) ā (1,168,420) ā ā ā ā ā ā ā Notes payable - unsecured, net of current portion ā $ ā ā $ ā |
STOCK OPTIONS AND WARRANTS (Tab
STOCK OPTIONS AND WARRANTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
STOCK OPTIONS AND WARRANTS | |
Schedule of stock option information | Summary stock option information is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Aggregate ā ā Weighted ā ā Aggregate ā Exercise ā Exercise ā Average ā ā Number ā Price ā Price Range ā Exercise Price Outstanding, December 31, 2021 1,575,000 ā $ 561,250 ā $ 0.25-0.75 ā $ 0.36 Granted ā ā ā ā ā ā ā ā ā Exercised ā ā ā ā ā ā ā ā Cancelled, forfeited or expired (50,000) ā (15,000) ā $ 0.30 ā $ 0.30 Outstanding, March 31, 2022 1,525,000 ā $ 546,250 ā $ 0.25-0.75 ā $ 0.36 Exercisable, March 31, 2022 1,186,111 ā $ 444,583 ā $ 0.25-0.75 ā $ 0.37 |
Schedule of stock warrant information | Summary Stock warrant information is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Aggregate ā ā Weighted ā ā Aggregate ā Exercise ā Exercise ā Average ā ā Number ā Price ā Price Range ā Exercise Price Outstanding, December 31, 2021 1,763,335 $ 496,667 ā $ 0.15-$0.75 ā $ 0.28 Granted ā ā ā ā ā ā ā ā ā Exercised ā ā ā ā ā ā ā ā Cancelled, forfeited or expired ā ā ā ā ā ā ā ā Outstanding, March 31, 2022 1,763,335 ā $ 496,667 ā $ 0.15 - 0.75 ā $ 0.28 Exercisable, March 31, 2022 1,763,335 ā $ 496,667 ā $ 0.15 - 0.75 ā $ 0.28 |
DISPOSITION OF BUSINESSES (Tabl
DISPOSITION OF BUSINESSES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
DISPOSITION OF BUSINESSES | |
Summary of balance sheets and statements of operations of Trinity and MG combined | ā ā ā ā ā ā ā ā ā March 31, December 31, ā ā 2022 ā 2021 Cash and cash equivalents ā $ ā ā $ 11 Accounts receivable, net ā 17,011 ā 17,011 Prepaid expenses and other current assets ā 424 ā 424 Current assets of discontinued operations ā 17,435 ā 17,446 Other assets ā 1,500 ā 1,500 Other assets of discontinued operations ā 1,500 ā 1,500 Total assets of discontinued operations ā $ 18,935 ā $ 18,946 Accounts payable ā $ 242,111 ā $ 400,659 Accrued expenses and other liabilities ā 252,624 ā 187,624 Current liabilities of discontinued operations ā 494,735 ā 588,283 Notes payable - secured, net of current portion ā 150,000 ā 150,000 Notes payable - unsecured, net of current portion ā 207,969 ā 231,746 Long term liabilities of discontinued operations ā 357,969 ā 381,746 Total liabilities of discontinued operations ā $ 852,704 ā $ 970,029 ā The statements of operations of Trinity and MG combined are summarized below: ā ā ā ā ā ā ā ā ā Three months ended ā ā March 31, ā March 31, ā ā 2022 ā 2021 Revenues ā $ ā ā $ 104,440 Cost of revenues ā ā ā (173,542) Selling, general and administrative ā ā ā (141,699) Loss from operations ā ā ā (210,801) Gain on extinguishment of debt ā ā ā 196,469 Other income (expense) ā 7,749 ā (2,913) Interest expense, net ā (2,861) ā (39,210) Net income (loss) from discontinued operations ā $ 4,888 ā $ (56,455) |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
LEASES | |
Schedule of components of lease cost for operating and finance leases | The components of lease cost for operating leases for the three months ended March 31, 2022 and 2021 were as follows: ā ā ā ā ā ā ā ā ā Three months ended ā ā March 31, 2022 ā March 31, 2021 Operating lease cost ā $ 300,758 ā $ 125,110 Short-term lease cost ā ā 151,021 ā ā 56,598 Total lease cost ā $ 451,779 ā $ 181,708 |
Schedule of supplemental cash flow information | Supplemental cash flow information related to leases was as follows: ā ā ā ā ā ā ā ā ā Three Months Ended Three Months Ended ā ā March 31, 2022 ā March 31, 2021 Other Lease Information ā ā ā ā ā ā Cash paid for amounts included in the measurement of lease liabilities: ā ā ā Operating cash flows from operating leases ā $ 29,037 ā $ 19,688 |
Schedule of lease position related assets and liabilities recorded in the consolidated balance sheets | The following table summarizes the lease-related assets and liabilities recorded in the consolidated balance sheets at March 31, 2022 and December 31, 2021: ā ā ā ā ā ā ā ā Lease Position March 31, 2022 December 31, 2021 Operating Leases ā ā Operating lease right-of-use assets ā $ 3,198,666 ā $ 3,312,710 Right of use liability operating lease current portion ā $ 933,060 ā $ 816,671 Right of use liability operating lease long term ā 2,458,598 ā 2,545,950 Total operating lease liabilities ā $ 3,391,658 ā $ 3,362,621 |
Schedule of operating lease other information | The Company utilizes the incremental borrowing rate in determining the present value of lease payments unless the implicit rate is readily determinable. ā ā ā ā ā ā ā Lease Term and Discount Rate March 31, 2022 December 31, 2021 Weighted-average remaining lease term (years) ā ā Operating leases 3.5 ā 3.7 ā Weighted-average discount rate ā ā ā ā Operating leases 11.5 % 10.9 % |
Schedule of maturities of lease liabilities | ā ā ā ā ā ā Operating ā ā Leases 2022 (Nine months remaining) ā $ 1,057,362 2023 ā 1,189,018 2024 ā 952,872 2025 ā 718,375 2026 and thereafter ā 232,764 Total future undiscounted lease payments ā ā 4,150,391 Less: Interest ā (758,733) Present value of lease liabilities ā $ 3,391,658 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Convertible notes payable | ||
Anti-dilutive shares, excluded from computation of earnings per share | 79,467,400 | 29,413,660 |
Stock Option [Member] | ||
Anti-dilutive shares, excluded from computation of earnings per share | 1,525,000 | 2,060,000 |
Warrant [Member] | ||
Anti-dilutive shares, excluded from computation of earnings per share | 1,763,335 | 1,763,335 |
Series A preferred stock [Member] | ||
Anti-dilutive shares, excluded from computation of earnings per share | 4,000,000 |
REVENUE (Details)
REVENUE (Details) - Customer - customer | 3 Months Ended | 12 Months Ended | 15 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | Mar. 31, 2022 | |
Customer concentration | Revenue Member | ||||
Concentration Risk [Line Items] | ||||
Number of customers | 0 | 1 | ||
Concentration risk percentage | 12.00% | |||
Customer concentration | Revenue Member | Maximum | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 10.00% | |||
Credit concentration | Accounts receivable | ||||
Concentration Risk [Line Items] | ||||
Number of customers | 0 | |||
Concentration risk percentage | 10.00% | 10.00% |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Property and equipment, gross | $ 22,331,411 | $ 21,725,545 |
Less: accumulated depreciation | (12,619,594) | (11,262,193) |
Property and equipment, net | 9,711,817 | 10,463,352 |
Truckers and trailers | ||
Property and equipment, gross | 11,735,845 | 11,167,001 |
Downhole oil tools | ||
Property and equipment, gross | 659,873 | 659,873 |
Vehicles | ||
Property and equipment, gross | 1,538,528 | 1,538,528 |
Building | ||
Property and equipment, gross | 493,529 | 493,529 |
Furniture, fixtures and other | ||
Property and equipment, gross | 98,017 | 98,017 |
Equipment | ||
Property and equipment, gross | $ 7,805,619 | $ 7,768,597 |
PROPERTY AND EQUIPMENT, NET - A
PROPERTY AND EQUIPMENT, NET - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
PROPERTY AND EQUIPMENT, NET | ||
Depreciation | $ 1,357,401 | $ 1,418,401 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
ACCRUED EXPENSES AND OTHER LIABILITIES | ||
Payroll and payroll taxes payable | $ 1,414,195 | $ 1,929,414 |
State and local tax payable | 394,500 | 422,781 |
Interest payable | 460,261 | 482,950 |
Accrued operational expenses | 1,653,883 | 1,006,343 |
Accrued general and administrative expenses | 100,300 | 178,561 |
Other | 82,230 | 35,064 |
Total Accrued Expenses and Other Liabilities | $ 4,105,369 | $ 4,055,113 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 07, 2021 |
Notes payable: | |||
Notes Payable | $ 22,834,805 | $ 18,363,064 | |
Less discounts and deferred finance costs | (287,560) | (299,353) | |
Less current maturities | (3,696,887) | (3,527,960) | |
Long term secured notes payable, net of current maturities and discounts | 18,850,358 | 14,535,751 | |
5J Entities | |||
Notes payable: | |||
Notes Payable | 738,185 | 0 | |
Secured Note Dec 2018 One [Member] | |||
Notes payable: | |||
Notes Payable | 100,000 | 100,000 | |
Secured Note Dec 2018 Two [Member] | |||
Notes payable: | |||
Notes Payable | 100,000 | 100,000 | |
Secured Note Dec 2018 Three [Member] | |||
Notes payable: | |||
Notes Payable | 100,000 | 100,000 | |
Secured Note Dec 2018 Four [Member] | |||
Notes payable: | |||
Notes Payable | 792,470 | 792,470 | |
Secured Note June 2019 [Member] | |||
Notes payable: | |||
Notes Payable | 80,000 | 80,000 | |
Secured Note May 2019 One [Member] | |||
Notes payable: | |||
Notes Payable | 100,000 | 100,000 | |
Secured Note February 2020 One [Member] | |||
Notes payable: | |||
Notes Payable | 2,000,000 | 2,000,000 | |
Various Secured Notes Payable Maturing From January 2023 Through March 2023 [Member] | |||
Notes payable: | |||
Notes Payable | 267,509 | 343,723 | |
Secured Note February 2020 Two [Member] | |||
Notes payable: | |||
Notes Payable | 428,253 | 545,050 | |
Secured Promissory Notes [Member] | |||
Notes payable: | |||
Notes Payable | 390,000 | 390,000 | |
Secured Promissory Notes, June 2020 [Member] | |||
Notes payable: | |||
Notes Payable | 998,388 | 1,071,821 | |
Secured Promissory Note September 2021 [Member] | |||
Notes payable: | |||
Notes Payable | $ 16,740,000 | $ 12,740,000 | $ 12,740,000 |
NOTES PAYABLE - Future maturiti
NOTES PAYABLE - Future maturities of secured notes payable (Details) | Mar. 31, 2022USD ($) |
NOTES PAYABLE. | |
2022 | $ 20,604,868 |
2023 | 9,428,850 |
2024 | 3,831,511 |
2025 | 3,644,580 |
2026 | 7,046,990 |
Thereafter | 211,951 |
Total | $ 44,768,750 |
NOTES PAYABLE - Unsecured notes
NOTES PAYABLE - Unsecured notes payable (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Notes payable: | ||
Notes payable - unsecured | $ 3,348,891 | $ 1,429,981 |
Less discounts and deferred finance costs | 0 | (261,561) |
Less current portion | (3,348,891) | (1,168,420) |
Notes payable - unsecured, net of current portion | 0 | 0 |
Insurance Premium Financing Note December 2021 [Member] | ||
Notes payable: | ||
Unsecured Debt | 1,214,867 | 0 |
Insurance Premium Financing Note May 2022 [Member] | ||
Notes payable: | ||
Unsecured Debt | 297,400 | 743,576 |
Insurance Premium Financing Note February 2022 [Member] | ||
Notes payable: | ||
Unsecured Debt | 0 | 58,413 |
Unsecured Note Payable With Shareholder [Member] | ||
Notes payable: | ||
Unsecured Debt | 44,559 | 44,559 |
Unsecured Advances from Momentum Water Transfer Service LLC [Member] | ||
Notes payable: | ||
Unsecured Debt | 35,000 | 35,000 |
Unsecured payable for settlement of lawsuit | ||
Notes payable: | ||
Unsecured Debt | 77,967 | |
Unsecured note payable for settlement of lawsuit | ||
Notes payable: | ||
Unsecured Debt | 77,967 | 98,433 |
Unsecured note payable with a shareholder who controls 4.1% of votes | ||
Notes payable: | ||
Unsecured Debt | 1,045,025 | 150,000 |
Unsecured note payable with shareholder two | ||
Notes payable: | ||
Unsecured Debt | 250,000 | 150,000 |
Unsecured note payable with shareholder three | ||
Notes payable: | ||
Unsecured Debt | 250,000 | 150,000 |
Unsecured note payable with shareholder four | ||
Notes payable: | ||
Unsecured Debt | $ 134,073 | $ 0 |
NOTES PAYABLE - Additional Info
NOTES PAYABLE - Additional Information (Details) - USD ($) | Mar. 03, 2022 | Feb. 14, 2022 | Feb. 11, 2022 | Jan. 27, 2022 | Sep. 07, 2021 | Jun. 20, 2020 | Feb. 27, 2020 | Dec. 07, 2018 | Mar. 31, 2022 | Mar. 31, 2021 | Jun. 30, 2021 | Feb. 27, 2022 | Jan. 07, 2022 | Jan. 06, 2022 | Dec. 31, 2021 | Feb. 27, 2021 | Jun. 17, 2019 | May 01, 2019 | Aug. 10, 2018 |
Debt Instrument, Face Amount | $ 843,844 | $ 8,907,035 | |||||||||||||||||
Initial installment amount | 95,025 | ||||||||||||||||||
Additional payment | 10,634 | ||||||||||||||||||
Notes Payable | 22,834,805 | $ 18,363,064 | |||||||||||||||||
Convertible notes, related party balance | 7,906,740 | ||||||||||||||||||
Amortization of Debt Discount (Premium) | 798,845 | ||||||||||||||||||
Unamortized Debt Discount | 3,871,373 | ||||||||||||||||||
Current portion of convertible note | 3,443,972 | 1,616,672 | |||||||||||||||||
Convertible notes, net | 5,035,662 | 4,236,817 | |||||||||||||||||
Debt Instrument, Periodic Payment, Interest | 147,818 | ||||||||||||||||||
Convertible note payable, net | 1,591,690 | 2,620,145 | |||||||||||||||||
Monthly periodic payment | 15,275 | ||||||||||||||||||
Catalyst Finance L.P. [Member] | |||||||||||||||||||
Long-term Line of Credit | 9,676,648 | 9,468,759 | |||||||||||||||||
Maximum | |||||||||||||||||||
Debt Instrument, Face Amount | $ 16,740,000 | ||||||||||||||||||
Minimum | |||||||||||||||||||
Debt Instrument, Face Amount | 12,740,000 | ||||||||||||||||||
Newton Dorsett | |||||||||||||||||||
Debt Instrument, Face Amount | $ 100,000 | ||||||||||||||||||
Grey Fox Investments | |||||||||||||||||||
Debt Instrument, Face Amount | 100,000 | ||||||||||||||||||
Mr. Madden | |||||||||||||||||||
Debt Instrument, Face Amount | $ 100,000 | ||||||||||||||||||
Secured Note January 2018 [Member] | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Unsecured Note August 10 2018 [Member] | |||||||||||||||||||
Debt Instrument, Face Amount | $ 40,000 | ||||||||||||||||||
Debt Instrument Additional Face Amount | $ 25,000 | ||||||||||||||||||
Unsecured Note August 10 2018 [Member] | Maximum | |||||||||||||||||||
Interest rate | 15.00% | ||||||||||||||||||
Unsecured Note August 10 2018 [Member] | Minimum | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Unsecured notes payable [Member] | |||||||||||||||||||
Amortization of Debt Discount (Premium) | 659,335 | ||||||||||||||||||
Secured notes payable [Member] | |||||||||||||||||||
Amortization of Debt Discount (Premium) | 11,793 | ||||||||||||||||||
Secured Note Dec 2018 One [Member] | |||||||||||||||||||
Notes Payable | 100,000 | 100,000 | |||||||||||||||||
Secured Note Dec 2018 One [Member] | Maximum | |||||||||||||||||||
Interest rate | 14.00% | ||||||||||||||||||
Secured Note Dec 2018 Two [Member] | |||||||||||||||||||
Notes Payable | 100,000 | 100,000 | |||||||||||||||||
Secured Note Dec 2018 Two [Member] | Maximum | |||||||||||||||||||
Interest rate | 14.00% | ||||||||||||||||||
Secured Note Dec 2018 Two [Member] | Minimum | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Secured Note Dec 2018 Three [Member] | |||||||||||||||||||
Notes Payable | 100,000 | 100,000 | |||||||||||||||||
Secured Note Dec 2018 Three [Member] | Maximum | |||||||||||||||||||
Interest rate | 14.00% | ||||||||||||||||||
Secured Note Dec 2018 Three [Member] | Minimum | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Secured Promissory Note January 2022 | |||||||||||||||||||
Initial installment amount | 95,025 | ||||||||||||||||||
Monthly periodic payment | $ 15,275 | ||||||||||||||||||
Secured Note Dec 2018 Four [Member] | |||||||||||||||||||
Interest rate | 6.00% | ||||||||||||||||||
Notes Payable | 792,470 | 792,470 | |||||||||||||||||
Monthly periodic payment | $ 7,500 | ||||||||||||||||||
Secured Note May 2019 One [Member] | |||||||||||||||||||
Debt Instrument, Face Amount | $ 100,000 | ||||||||||||||||||
Notes Payable | 100,000 | 100,000 | |||||||||||||||||
Secured Note May 2019 One [Member] | Maximum | |||||||||||||||||||
Interest rate | 14.00% | ||||||||||||||||||
Secured Note May 2019 One [Member] | Minimum | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Secured Note July 2019 [Member] | Maximum | |||||||||||||||||||
Interest rate | 14.00% | ||||||||||||||||||
Secured Note July 2019 [Member] | Minimum | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Secured Note December, 2019 | |||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Secured Note February 2020 One [Member] | |||||||||||||||||||
Notes Payable | 2,000,000 | 2,000,000 | |||||||||||||||||
Various Secured Notes Payable Maturing From January 2023 Through March 2023 [Member] | |||||||||||||||||||
Notes Payable | $ 267,509 | 343,723 | |||||||||||||||||
Various Secured Notes Payable Maturing From January 2023 Through March 2023 [Member] | Maximum | |||||||||||||||||||
Interest rate | 5.50% | ||||||||||||||||||
Various Secured Notes Payable Maturing From January 2023 Through March 2023 [Member] | Minimum | |||||||||||||||||||
Interest rate | 5.32% | ||||||||||||||||||
Secured Note February 2020 Two [Member] | |||||||||||||||||||
Notes Payable | $ 428,253 | 545,050 | |||||||||||||||||
Secured Promissory Notes [Member] | |||||||||||||||||||
Debt Instrument, Face Amount | $ 1,600,000 | 1,600,000 | |||||||||||||||||
Interest rate | 3.75% | ||||||||||||||||||
Notes Payable | $ 390,000 | 390,000 | |||||||||||||||||
Secured Promissory Notes, June 2020 [Member] | |||||||||||||||||||
Notes Payable | 998,388 | 1,071,821 | |||||||||||||||||
Monthly periodic payment | $ 45,585 | ||||||||||||||||||
Deferred Financing Cost | 287,560 | ||||||||||||||||||
Insurance Premium Financing Note December 2021 [Member] | |||||||||||||||||||
Debt Instrument, Face Amount | $ 1,353,151 | ||||||||||||||||||
Interest rate | 4.76% | ||||||||||||||||||
Monthly periodic payment | $ 138,285 | ||||||||||||||||||
Amerisource Note | |||||||||||||||||||
Debt Instrument, Face Amount | $ 1,600,000 | ||||||||||||||||||
Interest rate | 12.00% | 11.00% | |||||||||||||||||
Amortization of Debt Discount (Premium) | 34,982 | ||||||||||||||||||
Unamortized Debt Discount | 116,608 | ||||||||||||||||||
Number of shares issued to investors | 2,498,736 | ||||||||||||||||||
Interest rate | 10.00% | ||||||||||||||||||
Deferred Financing Cost | $ 419,788 | ||||||||||||||||||
Equity Method Investment, Ownership Percentage | 13.90% | ||||||||||||||||||
Common stock Conversion price | $ 0.25 | ||||||||||||||||||
Secured Note June 2019 [Member] | |||||||||||||||||||
Notes Payable | $ 80,000 | 80,000 | |||||||||||||||||
Unsecured payable for settlement of lawsuit | |||||||||||||||||||
Debt Instrument, Face Amount | $ 196,188 | ||||||||||||||||||
Monthly Payment Amount | $ 6,822 | ||||||||||||||||||
Unsecured payable for settlement of lawsuit | Maximum | |||||||||||||||||||
Interest rate | 18.00% | ||||||||||||||||||
Unsecured payable for settlement of lawsuit | Minimum | |||||||||||||||||||
Interest rate | 6.00% | ||||||||||||||||||
Secured Promissory Note September 2021 [Member] | |||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Notes Payable | 12,740,000 | $ 16,740,000 | 12,740,000 | ||||||||||||||||
Insurance Premium Financing Note May 2022 [Member] | |||||||||||||||||||
Debt Instrument, Face Amount | $ 1,487,202 | ||||||||||||||||||
Interest rate | 6.99% | ||||||||||||||||||
Monthly periodic payment | $ 153,537 | ||||||||||||||||||
Insurance Premium Financing Note February 2022 [Member] | |||||||||||||||||||
Debt Instrument, Face Amount | $ 292,065 | ||||||||||||||||||
Interest rate | 5.78% | ||||||||||||||||||
Monthly periodic payment | $ 7,793 | ||||||||||||||||||
Unsecured note payable with shareholder two | |||||||||||||||||||
Debt Instrument, Face Amount | $ 150,000 | ||||||||||||||||||
Debt Instrument Additional Face Amount | $ 100,000 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Unsecured note payable with shareholder three | |||||||||||||||||||
Debt Instrument, Face Amount | $ 150,000 | ||||||||||||||||||
Debt Instrument Additional Face Amount | $ 100,000 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Unsecured note payable with shareholder four | |||||||||||||||||||
Debt Instrument, Face Amount | $ 134,073 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Unsecured note payable with a shareholder who controls 4.1% of votes | |||||||||||||||||||
Debt Instrument, Face Amount | $ 150,000 | ||||||||||||||||||
Debt Instrument Additional Face Amount | $ 895,025 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
5J Entities | |||||||||||||||||||
Notes Payable | 738,185 | 0 | |||||||||||||||||
Amortization of Debt Discount (Premium) | 27,059 | ||||||||||||||||||
Unamortized Debt Discount | 1,369 | ||||||||||||||||||
Deferred Financing Cost | $ 223,558 | ||||||||||||||||||
5J Entities | Amended Loan Agreement With Amerisource Funding | |||||||||||||||||||
Proceeds from Issuance of Debt | 4,000,000 | ||||||||||||||||||
5J Entities | Amended Loan Agreement With Amerisource Funding | Maximum | |||||||||||||||||||
Debt Instrument, Face Amount | 16,740,000 | ||||||||||||||||||
5J Entities | Amended Loan Agreement With Amerisource Funding | Minimum | |||||||||||||||||||
Debt Instrument, Face Amount | $ 12,740,000 | ||||||||||||||||||
5J Entities | Amerisource AR Facility | |||||||||||||||||||
Debt Instrument, Face Amount | 10,000,000 | ||||||||||||||||||
Maximum borrowing capacity | $ 10,000,000 | ||||||||||||||||||
Maximum availability (as a percent) | 90.00% | ||||||||||||||||||
Basis spread on variable rate (as a percent) | 4.50% | ||||||||||||||||||
Initial collateral management fee (as a percent) | 0.75% | ||||||||||||||||||
Non-usage fee (as a percent) | 0.35% | ||||||||||||||||||
One time commitment fee | $ 100,000 | ||||||||||||||||||
Number of days written notice for termination of debt | 60 days | ||||||||||||||||||
Early termination fee, if more than 12months remaining in the debt term (as a percent) | 2.00% | ||||||||||||||||||
Early termination fee, if twelve months or less remaining in the debt term (as a percent) | 1.00% | ||||||||||||||||||
5J Entities | Amerisource Equipment Loan | |||||||||||||||||||
Debt Instrument, Face Amount | $ 1,401,559 | ||||||||||||||||||
5J Entities | Amerisource Bridge Facility | |||||||||||||||||||
Debt Instrument, Face Amount | $ 550,690 | ||||||||||||||||||
Convertible notes payable | |||||||||||||||||||
Convertible notes, related party balance | 1,129,098 | ||||||||||||||||||
Current portion of convertible note | 1,616,672 | ||||||||||||||||||
Convertible notes payable | Notes Payable To Related Party [Member] | |||||||||||||||||||
Current portion of convertible note | $ 2,620,145 | ||||||||||||||||||
Current portion of convertible note | 3,443,972 | ||||||||||||||||||
Convertible note payable, net | $ 1,591,690 | ||||||||||||||||||
Short term Bridge Note maturing on January, 2022 | |||||||||||||||||||
Debt Instrument, Face Amount | 250,000 | 250,000 | |||||||||||||||||
Short term Bridge Note maturing on January, 2022 | Newton Dorsett | |||||||||||||||||||
Debt Instrument, Face Amount | $ 150,000 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Short term Bridge Note maturing on January, 2022 | Grey Fox Investments | |||||||||||||||||||
Debt Instrument, Face Amount | $ 150,000 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Short term Bridge Note maturing on January, 2022 | Mr. Madden | |||||||||||||||||||
Debt Instrument, Face Amount | $ 150,000 | ||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||
Short term Bridge Note maturing on March, 2022 | James Frye | |||||||||||||||||||
Debt Instrument, Face Amount | $ 134,073 | ||||||||||||||||||
Number of shares issued to investors | 201,110 | ||||||||||||||||||
Short term Bridge Note maturing on March, 2022 | Mr. Madden | |||||||||||||||||||
Debt Instrument, Face Amount | $ 450,000 | $ 250,000 | $ 95,025 | ||||||||||||||||
Number of shares issued to investors | 675,000 | 375,000 | 142,538 |
STOCKHOLDERS' DEFICIT (Details)
STOCKHOLDERS' DEFICIT (Details) | 3 Months Ended |
Mar. 31, 2022USD ($)shares | |
STOCKHOLDERS' DEFICIT | |
Number of shares issued to lender | shares | 1,393,648 |
Value of shares issued for deferred financing costs | $ | $ 397,773 |
STOCK OPTIONS AND WARRANTS (Det
STOCK OPTIONS AND WARRANTS (Details) - Employee Stock Option [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Outstanding - Aggregate Number - Beginning Balance | 1,575,000 | |
Granted - Aggregate Number | 0 | |
Exercised - Aggregate Number | 0 | |
Cancelled, Forfeited or Expired - Aggregate Number | (50,000) | |
Outstanding - Aggregate Number - Ending Balance | 1,525,000 | |
Exercisable - Aggregate Number | 1,186,111 | |
Outstanding - Aggregate Exercise Price - Beginning Balance | $ 561,250 | |
Granted - Aggregate Exercise Price | 0 | |
Exercised - Aggregate Exercise Price | 0 | |
Cancelled, forfeited or expired - Aggregate Exercise Price | (15,000) | |
Outstanding - Aggregate Exercise Price - Ending Balance | 546,250 | |
Exercisable - Aggregate Exercise Price | $ 444,583 | |
Granted - Exercise Price Range | $ 0 | |
Exercised- Exercise Price Range | 0 | |
Cancelled, forfeited or expired - Exercise Price Range | 0.30 | |
Outstanding - Weighted Average Exercise Price - Beginning Balance | 0.36 | |
Granted - Weighted Average Exercise Price | 0 | |
Exercised - Weighted Average Exercise Price | 0 | |
Cancelled, Forfeited or Expired - Weighted Average Exercise Price | 0.30 | |
Outstanding - Weighted Average Exercise Price - Ending Balance | 0.36 | |
Outstanding - Exercisable Weighted Average Exercise Price | 0.37 | |
Minimum | ||
Outstanding - Exercise Price Range | 0.25 | $ 0.25 |
Exercisable - Exercise Price Range | 0.25 | |
Maximum | ||
Outstanding - Exercise Price Range | 0.75 | $ 0.75 |
Exercisable - Exercise Price Range | $ 0.75 |
STOCK OPTIONS AND WARRANTS - St
STOCK OPTIONS AND WARRANTS - Stock warrant information (Details) - Warrant [Member] | 3 Months Ended |
Mar. 31, 2022USD ($)$ / sharesshares | |
Outstanding - Aggregate Number - Beginning Balance | shares | 1,763,335 |
Granted - Aggregate Number | shares | 0 |
Exercised - Aggregate Number | shares | 0 |
Cancelled, Forfeited or Expired - Aggregate Number | shares | 0 |
Outstanding - Aggregate Number - Ending Balance | shares | 1,763,335 |
Exercisable - Aggregate Number | shares | 1,763,335 |
Outstanding - Aggregate Exercise Price - Beginning Balance | $ | $ 496,667 |
Granted - Aggregate Exercise Price | $ | 0 |
Exercised - Aggregate Exercise Price | $ | 0 |
Cancelled, forfeited or expired - Aggregate Exercise Price | $ | 0 |
Outstanding - Aggregate Exercise Price - Ending Balance | $ | 496,667 |
Exercisable - Aggregate Exercise Price | $ | $ 496,667 |
Granted - Exercise Price Range | $ 0 |
Exercised - Exercise Price Range | 0 |
Cancelled, Forfeited or Expired - Exercise Price Range | 0 |
Outstanding - Weighted Average Exercise Price - Beginning Balance | 0.28 |
Granted - Weighted Average Exercise Price | 0 |
Exercised - Weighted Average Exercise Price | 0 |
Cancelled, Forfeited or Expired - Weighted Average Exercise Price | 0 |
Outstanding - Weighted Average Exercise Price - Ending Balance | 0.28 |
Exercisable - Weighted Average Exercise Price | 0.28 |
Minimum | |
Outstanding - Exercise Price Range - Beginning Balance | 0.15 |
Outstanding - Exercise Price Range - Ending Balance | 0.15 |
Exercisable - Exercise Price Range | 0.15 |
Maximum | |
Outstanding - Exercise Price Range - Beginning Balance | 0.75 |
Outstanding - Exercise Price Range - Ending Balance | 0.75 |
Exercisable - Exercise Price Range | $ 0.75 |
STOCK OPTIONS AND WARRANTS - Ad
STOCK OPTIONS AND WARRANTS - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Stock Option [Member] | |
Weighted average remaining contractual life of stock options | 2 years 7 months 9 days |
Intrinsic value of outstanding Stock option | $ 0 |
Warrant [Member] | |
weighted average remaining contractual life of stock warrants | 4 years 10 months 6 days |
Aggregate intrinsic value of stock warrants | $ 16,750 |
DISPOSITION OF BUSINESSES - MG
DISPOSITION OF BUSINESSES - MG Cleaners LLC (Details) - USD ($) | Dec. 22, 2020 | Feb. 28, 2021 | Dec. 31, 2020 | Mar. 31, 2022 | Dec. 31, 2021 |
Par value | $ 0.001 | $ 0.001 | |||
Mg Cleaners Llc [Member] | |||||
Number of shares returned | 1,408,276 | ||||
Par value | $ 0.001 | ||||
Total purchase price | $ 150,000 | ||||
Payment of consideration in cash | $ 75,000 | $ 75,000 | |||
Payments of consideration through sale of equipment | 40,000 | ||||
Payments of consideration to MG Cleaners | $ 35,000 |
DISPOSITION OF BUSINESSES - Bal
DISPOSITION OF BUSINESSES - Balance sheets (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Balance sheets of Trinity and MG combined | ||
Current assets of discontinued operations | $ 17,435 | $ 17,446 |
Other assets | 1,500 | 1,500 |
Current liabilities of discontinued operations | 494,735 | 588,283 |
Long term liabilities of discontinued operations | 357,969 | 381,746 |
Discontinued operation by sale [Member] | Trinity and MG [Member] | ||
Balance sheets of Trinity and MG combined | ||
Cash and cash equivalents | 11 | |
Accounts receivable, net | 17,011 | 17,011 |
Prepaid expenses and other current assets | 424 | 424 |
Current assets of discontinued operations | 17,435 | 17,446 |
Other assets | 1,500 | 1,500 |
Other assets of discontinued operations | 1,500 | 1,500 |
Total assets of discontinued operations | 18,935 | 18,946 |
Accounts payable | 242,111 | 400,659 |
Accrued expenses and other liabilities | 252,624 | 187,624 |
Current liabilities of discontinued operations | 494,735 | 588,283 |
Notes payable - secured, net of current portion | 150,000 | 150,000 |
Notes payable - unsecured, net of current portion | 207,969 | 231,746 |
Long term liabilities of discontinued operations | 357,969 | 381,746 |
Total liabilities of discontinued operations | $ 852,704 | $ 970,029 |
DISPOSITION OF BUSINESSES - Sta
DISPOSITION OF BUSINESSES - Statements of operations (Details) - Discontinued operation by sale [Member] - Trinity and MG [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Statements of operations of Trinity and MG | ||
Revenues | $ 104,440 | |
Cost of revenues | (173,542) | |
Selling, general and administrative | (141,699) | |
Loss from operations | (210,801) | |
Gain on extinguishment of debt | 196,469 | |
Other income (expense) | $ 7,749 | (2,913) |
Interest expense, net | (2,861) | (39,210) |
Net income (loss) from discontinued operations | $ 4,888 | $ (56,455) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($)M | Mar. 31, 2022USD ($) | |
Letter of credit as collateral for insurance policy | $ 414,638 | ||
Unsecured payable for settlement of lawsuit | |||
Monthly Payment | $ 6,822 | ||
Outstanding balance | $ 77,967 | ||
Unsecured payable for settlement of lawsuit | 5J Trucking and James E Frye | |||
Settlement amount of outstanding accounts payable | $ 196,188 | ||
Outstanding Accounts Payable Upon Execution | $ 50,000 | ||
Number of monthly payments | M | 24 | ||
Monthly Payment | $ 6,822 |
LEASES (Details)
LEASES (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Finance lease cost | ||
Operating lease cost | $ 300,758 | $ 125,110 |
Short-term lease cost | 151,021 | 56,598 |
Total lease cost | $ 451,779 | $ 181,708 |
Minimum | ||
Operating lease, lease term | 1 year | |
Finance lease, lease term | 1 year | |
Maximum | ||
Operating lease, lease term | 4 years | |
Finance lease, lease term | 4 years |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 29,037 | $ 19,688 |
LEASES - Lease-related assets a
LEASES - Lease-related assets and liabilities (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Lease Position | ||
Operating lease right-of-use assets | $ 3,198,666 | $ 3,312,710 |
Right of use liability operating lease current portion | 933,060 | 816,671 |
Right of use liability operating lease long term | 2,458,598 | 2,545,950 |
Present value of lease liabilities | $ 3,391,658 | $ 3,362,621 |
LEASES - Other information (Det
LEASES - Other information (Details) | Mar. 31, 2022 | Dec. 31, 2021 |
Weighted-average remaining lease term (years) | ||
Operating leases | 3 years 6 months | 3 years 8 months 12 days |
Weighted-average discount rate | ||
Operating leases | 11.50% | 10.90% |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
LEASES | ||
2022 (Nine months remaining) | $ 1,057,362 | |
2023 | 1,189,018 | |
2024 | 952,872 | |
2025 | 718,375 | |
2026 and thereafter | 232,764 | |
Total future undiscounted lease payments | 4,150,391 | |
Less: Interest | (758,733) | |
Present value of lease liabilities | $ 3,391,658 | $ 3,362,621 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 3 Months Ended |
Mar. 31, 2022USD ($)lease | |
Related Party Transaction [Line Items] | |
Related party transaction rental services | $ 26,300 |
Revenue from Related Parties | 25,427 |
Notes payable to related parties | 7,906,740 |
Convertible notes payable | |
Related Party Transaction [Line Items] | |
Notes payable to related parties | $ 1,129,098 |
Five J Properties LLC [Member] | |
Related Party Transaction [Line Items] | |
Number of leases with related party | lease | 3 |
Terms of leases | 5 years |
Lessee, Operating Lease, Existence of Option to Extend [true false] | true |
Current monthly rent payments for all leases with related party | $ 14,250 |