Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 01, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | QRHC | |
Entity Registrant Name | Quest Resource Holding Corporation | |
Entity Central Index Key | 1,442,236 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 111,714,938 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 5,054,120 | $ 3,154,540 |
Accounts receivable, less allowance for doubtful accounts of $535,289 and $760,917 as of September 30, 2015 and December 31, 2014, respectively | 29,785,568 | 29,631,843 |
Prepaid expenses and other current assets | 1,270,534 | 684,032 |
Total current assets | 36,110,222 | 33,470,415 |
Goodwill | 58,337,290 | 58,337,290 |
Intangible assets, net | 13,133,837 | 15,115,617 |
Property and equipment, net, and other assets | 1,463,035 | 753,493 |
Total assets | 109,044,384 | 107,676,815 |
Current liabilities: | ||
Line of credit | 5,250,000 | |
Accounts payable and accrued liabilities | 33,861,459 | 26,621,907 |
Deferred revenue and other current liabilities | 249,231 | 282,189 |
Total current liabilities | 34,110,690 | 32,154,096 |
Line of credit | 3,000,000 | |
Other long-term liabilities | 105,776 | 45,206 |
Total liabilities | $ 37,216,466 | $ 32,199,302 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of September 30, 2015 and December 31, 2014, respectively | ||
Common stock, $0.001 par value, 200,000,000 shares authorized, 111,714,938 and 111,601,304 shares issued and outstanding as of September 30, 2015 and December 31, 2014, respectively | $ 111,715 | $ 111,601 |
Additional paid-in capital | 151,816,614 | 150,789,292 |
Accumulated deficit | (80,100,411) | (75,423,380) |
Total stockholders’ equity | 71,827,918 | 75,477,513 |
Total liabilities and stockholders’ equity | $ 109,044,384 | $ 107,676,815 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (Unaudited) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 535,289 | $ 760,917 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 111,714,938 | 111,601,304 |
Common stock, shares outstanding | 111,714,938 | 111,601,304 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Statement [Abstract] | ||||
Revenue | $ 43,567,822 | $ 46,981,143 | $ 125,906,645 | $ 127,655,458 |
Cost of revenue | 40,049,271 | 43,129,793 | 115,685,809 | 116,962,978 |
Gross profit | 3,518,551 | 3,851,350 | 10,220,836 | 10,692,480 |
Operating expenses: | ||||
Selling, general, and administrative | 4,110,442 | 3,486,822 | 11,793,700 | 9,972,037 |
Depreciation and amortization | 989,105 | 956,823 | 2,940,576 | 2,861,985 |
Total operating expenses | 5,099,547 | 4,443,645 | 14,734,276 | 12,834,022 |
Operating loss | (1,580,996) | (592,295) | (4,513,440) | (2,141,542) |
Other expense: | ||||
Interest expense | (72,758) | (2,494,060) | (163,591) | (4,259,980) |
Loss on extinguishment of debt | (1,658,531) | (1,658,531) | ||
Total other expense | (72,758) | (4,152,591) | (163,591) | (5,918,511) |
Loss before taxes | (1,653,754) | (4,744,886) | (4,677,031) | (8,060,053) |
Net loss | (1,653,754) | (4,744,886) | (4,677,031) | (8,060,053) |
Net loss applicable to common stockholders | $ (1,653,754) | $ (4,744,886) | $ (4,677,031) | $ (8,060,053) |
Net loss per share | ||||
Basic and diluted | $ (0.01) | $ (0.05) | $ (0.04) | $ (0.08) |
Weighted average number of common shares outstanding | ||||
Basic and diluted | 111,714,938 | 97,999,629 | 111,673,440 | 96,831,520 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) - 9 months ended Sep. 30, 2015 - USD ($) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit[Member] |
Beginning Balance at Dec. 31, 2014 | $ 75,477,513 | $ 111,601 | $ 150,789,292 | $ (75,423,380) |
Beginning Balance, Shares at Dec. 31, 2014 | 11,601,304 | |||
Stock-based compensation | $ 966,731 | 966,731 | ||
Shares issued for vested restricted stock units, Value | $ 57 | (57) | ||
Shares issued for vested restricted stock units, Shares | 56,500 | 56,500 | ||
Shares issued for Employee Stock Purchase Plan options, Value | $ 60,705 | $ 57 | 60,648 | |
Shares issued for Employee Stock Purchase Plan options, Shares | 57,134 | 57,134 | ||
Net loss | $ (4,677,031) | (4,677,031) | ||
Ending Balance at Sep. 30, 2015 | $ 71,827,918 | $ 111,715 | $ 151,816,614 | $ (80,100,411) |
Ending Balance, Shares at Sep. 30, 2015 | 111,714,938 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Net loss | $ (4,677,031) | $ (8,060,053) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation | 218,225 | 223,499 |
Amortization of intangibles | 2,722,351 | 2,638,441 |
Amortization of debt discount and deferred financing costs | 0 | 2,998,403 |
Loss on extinguishment of debt | 1,658,531 | |
Interest converted to common stock | 105,261 | |
Loss on disposal of property and equipment | 2,050 | |
Provision for doubtful accounts | 3,972 | 41,183 |
Stock-based compensation | 931,874 | 1,123,827 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (157,697) | (7,228,939) |
Prepaid expenses and other current assets | (586,502) | (163,112) |
Security deposits and other assets | 9,714 | (15,716) |
Accounts payable and accrued liabilities | 7,274,409 | 1,499,081 |
Deferred revenue and other current liabilities | (73,776) | 76,785 |
Other long-term liabilities | 1,555 | 21,755 |
Net cash provided by (used in) operating activities | 5,669,144 | (5,081,054) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (819,608) | (103,119) |
Purchase of capitalized software development | (740,571) | (859,259) |
Net cash used in investing activities | (1,560,179) | (962,378) |
Cash flows from financing activities: | ||
Proceeds from line of credit | 4,450,000 | 2,500,000 |
Repayments to line of credit | (6,700,000) | |
Proceeds from the sale of capital stock | 60,705 | 18,570,543 |
Repayments of capital lease obligations | (20,090) | (14,601) |
Repayment of senior convertible notes - related party | (11,000,000) | |
Net cash provided by (used in) financing activities | (2,209,385) | 10,055,942 |
Net increase in cash and cash equivalents | 1,899,580 | 4,012,510 |
Cash and cash equivalents at beginning of period | 3,154,540 | 2,676,984 |
Cash and cash equivalents at end of period | 5,054,120 | 6,689,494 |
Supplemental cash flow information: | ||
Cash paid for interest | 166,035 | 1,153,275 |
Supplemental non-cash flow activities: | ||
Common stock issued for services and loan fees | 50,000 | |
Warrant liability issued for services | 34,857 | 26,826 |
Acquisition of equipment under capital lease | $ 119,923 | |
Notes Payable [Member] | ||
Supplemental non-cash flow activities: | ||
Common stock issued for conversion of notes payable | $ 11,025,000 |
The Company, Description of Bus
The Company, Description of Business, and Liquidity | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
The Company, Description of Business, and Liquidity | 1. The Company, Description of Business, and Liquidity The accompanying condensed consolidated financial statements include the accounts of Quest Resource Holding Corporation (“QRHC”) and its subsidiaries, Earth911, Inc. (“Earth911”), Quest Resource Management Group, LLC (“Quest”), Landfill Diversion Innovations, LLC, and Youchange, Inc. (“YouChange”) (collectively, “we,” “us,” or “our company”). Operations – We are an environmental solutions company that serves as a single-source provider of full service recycling and waste stream management solutions, as well as an environmental program services and information provider. We offer innovative, cost-effective, one-stop reuse, recycling, and waste disposal management programs designed to provide regional and national customers with a single point of contact for managing a variety of recyclables and disposables. Two customers accounted for 60.0% and 72.2% of revenue for the three months ended September 30, 2015 and 2014, respectively. Two customers accounted for 60.2% and 73.7% of revenue for the nine months ended September 30, 2015 and 2014, respectively. We also own the website, offering original online environmental related content about reuse, recycling, and disposal of waste and recyclables, and we own a comprehensive online database of local recycling and proper disposal options. Our principal offices are located in The Colony, Texas. Liquidity – As of September 30, 2015 and December 31, 2014, our working capital balance was $1,999,532 and $1,316,319, respectively. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principals of Presentation and Consolidation The condensed consolidated financial statements included herein have been prepared by us without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2014. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted, as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading. The accompanying condensed consolidated financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position at September 30, 2015 and the results of our operations and cash flows for the periods presented. We derived the December 31, 2014 condensed consolidated balance sheet data from audited financial statements, but did not include all disclosures required by GAAP. As Quest, Earth911, and YouChange each operate as ecology based green service companies, we did not deem segment reporting necessary. All intercompany accounts and transactions have been eliminated in consolidation. Interim results are subject to seasonal variations, and the results of operations for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the full year. Revenue Recognition We recognize revenue only when all of the following criteria have been met: · persuasive evidence of an arrangement exists; · delivery has occurred or services have been rendered; · the fee for the arrangement is fixed or determinable; and · collectability is reasonably assured. Persuasive Evidence of an Arrangement Exists – We document all terms of an arrangement in a service agreement or quote signed or confirmed by the customer prior to recognizing revenue. Delivery Has Occurred or Services Have Been Rendered – We perform all services or deliver all products prior to recognizing revenue. Services are deemed to be performed when the services are complete. The Fee for the Arrangement is Fixed or Determinable – Prior to recognizing revenue, a customer’s fee is either fixed or determinable under the terms of the quote, service agreement, or accepted customer purchase order. Collectability Is Reasonably Assured – We assess collectability on a customer by customer basis based on criteria outlined by management. We provide businesses with management programs to reuse, recycle, and dispose of a wide variety of waste streams and recyclables generated by their business. We utilize third-party subcontractors to execute the collection, transport, and recycling or disposal of used motor oil, oil filters, scrap tires, cooking oil, and expired food products. We evaluate the criteria outlined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Subtopic 605-45, Revenue Recognition—Principal Agent Considerations Earth911 revenue primarily represents licensing fees that we recognize ratably over the term of the license. We derive some revenue from advertising contracts, which we recognize ratably over the term that the advertisement appears on our website. Net Loss Per Share We compute basic net loss per share by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. We have other potentially dilutive securities outstanding that are not shown in a diluted net loss per share calculation because their effect in both 2015 and 2014 would be anti-dilutive. These potentially dilutive securities include options, restricted stock units, and warrants and totaled 16,269,839 and 17,122,532 shares at September 30, 2015 and 2014, respectively. The following table sets forth the anti-dilutive securities excluded from diluted loss per share: September 30, 2015 2014 (Unaudited) (Unaudited) Anti-dilutive securities excluded from diluted loss per share: Stock options 4,402,739 4,831,532 Restricted stock units 76,100 — Warrants 11,791,000 12,291,000 16,269,839 17,122,532 Inventories We record inventories within “Prepaid expenses and other current assets” in our condensed consolidated balance sheets. As of September 30, 2015 and December 31, 2014, all inventories were finished goods with a balance of $13,377 and $30,759, respectively, and consisted of waste disposal equipment, with no reserve for inventory obsolescence at either date. |
Property and Equipment, Net, an
Property and Equipment, Net, and Other Assets | 9 Months Ended |
Sep. 30, 2015 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment, Net, and Other Assets | 3. Property and Equipment, Net, and Other Assets At September 30, 2015 and December 31, 2014, property and equipment, net, and other assets consisted of the following: September 30, December 31, 2015 2014 (Unaudited) Property and equipment, net of accumulated depreciation of $1,895,096 and $1,692,835 as of September 30, 2015 and December 31, 2014, respectively $ 1,253,093 $ 533,837 Security deposits and other assets 209,942 219,656 Property and equipment, net, and other assets $ 1,463,035 $ 753,493 We compute depreciation using the straight-line method over the estimated useful lives of the property and equipment. The depreciation expense related to property and equipment was $71,844 and $81,038 for the three months ended September 30, 2015 and 2014, respectively. The depreciation expense related to property and equipment was $218,225 and $223,499 for the nine months ended September 30, 2015 and 2014, respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 4. Goodwill and Other Intangible Assets The components of goodwill and other intangible assets were as follows: September 30, 2015 (Unaudited) Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Finite lived intangible assets: Customer relationships 5 years $ 12,720,000 $ 5,618,000 $ 7,102,000 Trademarks 7 years 6,230,000 1,965,417 4,264,583 Patents 7 years 230,683 230,683 — Software 7 years 1,754,285 126,677 1,627,608 Customer lists 5 years 307,153 167,507 139,646 Total finite lived intangible assets $ 21,242,121 $ 8,108,284 $ 13,133,837 December 31, 2014 Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Finite lived intangible assets: Customer relationships 5 years $ 12,720,000 $ 3,710,000 $ 9,010,000 Trademarks 7 years 6,230,000 1,297,917 4,932,083 Patents 7 years 230,683 230,683 — Software 7 years 1,013,714 25,899 987,815 Customer lists 5 years 307,153 121,434 185,719 Total finite lived intangible assets $ 20,501,550 $ 5,385,933 $ 15,115,617 September 30, 2015 (Unaudited) and December 31, 2014 Estimated Useful Life Carrying Amount Indefinite lived intangible asset: Goodwill Indefinite $ 58,337,290 We compute amortization using the straight-line method over the estimated useful lives of the finite lived intangible assets. The amortization expense related to finite lived intangible assets was $917,261 and $875,740 for the three months ended September 30, 2015 and 2014, respectively. The amortization expense related to finite lived intangible assets was $2,722,351 and $2,638,441 for the nine months ended September 30, 2015 and 2014, respectively. We have no indefinite-lived intangible assets other than goodwill. The goodwill is not deductible for tax purposes. As required by FASB ASC Topic 350, Intangibles – Goodwill and Other |
Line of Credit
Line of Credit | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Line of Credit | 5. Line of Credit On December 15, 2010, Quest entered into a Revolving Credit Note and Loan Agreement with Regions Bank (“Regions”), a national banking association. This agreement, as amended, provides Quest with a loan facility up to $15,000,000 for working capital with advances generally limited to 80% of eligible accounts receivable from Quest’s largest customer and 85% of all other eligible accounts receivable. The facility matures May 13, 2018. The interest on the outstanding principal amount accrues daily and is payable monthly based on a fluctuating interest rate per annum, which is the base rate plus 1.50% (2.46% as of September 30, 2015). The base rate for any day is the greater of (a) the federal funds rate plus one-half of 1%, (b) Region’s published effective prime rate, or (c) the Eurodollar rate for such day based on an interest period of one month. To secure the amounts due under the agreement, Quest granted Regions a security interest in all of its assets with guarantees from QRHC and Earth911. Quest had $3,000,000 outstanding and $12,000,000 available to be borrowed as of September 30, 2015. The amount of interest expense related to the Regions line of credit for the three months ended September 30, 2015 and 2014 was $65,026 and $35,607, respectively. The amount of interest expense related to the Regions line of credit for the nine months ended September 30, 2015 and 2014 was $153,555 and $127,991, respectively. As of September 30, 2015, we were in compliance with the financial covenants. During the nine months ended September 30, 2015, Quest entered into two amendments with Regions. On May 13, 2015, Quest entered into a Seventh Amendment to Loan Agreement with Regions. The loan agreement was amended to, among other things, (i) reduce the applicable margin for eurodollar rate loans by 0.25% per annum, (ii) extend the maturity date to May 13, 2018, and (iii) modify the permitted acquisitions in certain respects. On July 7, 2015, Quest entered into an Eighth Amendment to Loan Agreement with Regions. The loan agreement was amended to, among other things, increase the aggregate revolving credit commitment to $15.0 million by exercising the $5.0 million accordion feature in the loan agreement. |
Long-Term Debt and Capital Leas
Long-Term Debt and Capital Lease Obligations | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Capital Lease Obligations | 6. Long-Term Debt and Capital Lease Obligations At September 30, 2015 and December 31, 2014, total capital lease obligations outstanding consisted of the following: September 30, December 31, 2015 2014 (Unaudited) Capital lease obligations, imputed interest at 4.75% to 4.87%, with monthly payments of $5,507, through August 2018, secured by computer and telephone equipment $ 143,025 $ 47,250 Total 143,025 47,250 Less: current maturities (60,592 ) (22,853 ) Long-term portion $ 82,433 $ 24,397 Our capital lease obligations are included within “Deferred revenue and other current liabilities” and “Other long-term liabilities” in our condensed consolidated balance sheets. The amount of interest expense related to our capital leases for the three months ended September 30, 2015 and 2014 was $833 and $767, respectively. The amount of interest expense related to our capital leases for the nine months ended September 30, 2015 and 2014 was $1,746 and $1,857, respectively. Convertible Secured Promissory Notes – Quest Acquisition – In connection with our acquisition of Quest from Quest Resource Group LLC (“QRG”) on July 16, 2013, we issued convertible secured promissory notes with a total principal amount of $22,000,000 to the owners of QRG who were related parties: the Chief Executive Officer of Quest and the former President of Quest. After the close of the transaction, the Chief Executive Officer of Quest became the President, Chief Executive Officer, and a member of the Board of Directors of our company until his resignation in October 2015, and the former President of Quest became a member of the Board of Directors of our company. The convertible secured promissory notes (collectively, the “Sellers Notes”) were each secured by a first-priority security interest in a 25% membership interest held by Earth911 in Quest (comprising a total of 50% of the membership interests of Quest), as set forth in security and membership interest pledge agreements, by and between Earth911 and the sellers. The Sellers Notes accrued interest at a rate of 7% per annum and were payable on a monthly basis on the 5 th day of the month beginning on September 5, 2013. The principal amount was due and payable in one installment on July 16, 2016. The Sellers Notes were convertible at any time, in the sole discretion of the holders, into shares of our common stock at a price of $2.00 per share. In addition, the Sellers Notes were convertible, in our sole discretion, into shares of our common stock at a price of $2.00 per share at any time after (i) the two year anniversary of the Notes, (ii) the principal amount of each Sellers Note had been paid down by $5,000,000 as a result of the first capital raise, (iii) our common stock trades on the Nasdaq Stock Market, the New York Stock Exchange, or NYSE MKT, and (iv) our common stock has traded at four times the $2.00 conversion price, as adjusted for any stock splits, reverse stock splits, or both. Based on our share price at the time we entered into the Sellers Notes agreement, we recognized a beneficial conversion feature (“BCF”) of $5,500,000 and discounted the Sellers Notes. On September 24, 2014, we repaid $11,000,000 of the Sellers Notes using proceeds from our public offering. Additionally, the holders converted the remaining $11,000,000 of Sellers Notes, plus accrued interest through September 24, 2014 of $101,260, into 5,550,630 shares of our common stock. In accordance with FASB ASC Topic 740-20, Debt with Conversion and Other Options |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes We compute income taxes using the asset and liability method in accordance with FASB ASC Topic 740, Income Taxes |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 8. Fair Value of Financial Instruments Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, line of credit, capital lease obligations, and warrant liability. We do not believe that we are exposed to significant interest, currency, or credit risks arising from these financial instruments. With the exception of the warrant liability, the fair values of these financial instruments approximate their carrying values using Level 3 inputs, based on their short maturities or, for long-term portions of capital lease obligations and line of credit, based on borrowing rates currently available to us for loans with similar terms and maturities. On May 7, 2014, we issued an aggregate of 200,000 warrants to purchase shares of our common stock to a consultant in exchange for services rendered during 2014. Of these warrants, 100,000 vested immediately and resulted in no expense recorded for the three months ended September 30, 2015. The remaining 100,000 warrants, which we had classified as a liability, vested on May 7, 2015, subject to performance conditions. We measured the warrants at fair value by applying the Black-Scholes-Merton valuation model, which utilizes Level 3 inputs. As of May 7, 2015, the assumptions used in the Black-Scholes-Merton valuation for the 100,000 warrants that vested on May 7, 2015 were as follows: volatility of 88.5%; risk free interest rate of 0.63%; expected term of two years; and expected dividend yield of 0%. The grant date fair value of the warrant valuation described above was $0.35 per warrant. We based the risk free interest rate on U.S. Treasury rates with maturity dates approximating the expected term of the warrants. We determined the historical volatility using the historical changes in the market price of our common stock and applicable comparable companies. We report the warrant liability in “Accounts payable and accrued liabilities” within our balance sheets. Our warrant liability was nil and $34,857 at September 30, 2015 and December 31, 2014, respectively. Due to the decline in the fair value of these warrants, we recorded an increase of stock-based compensation expense of nil and $144 for the three and nine months ended September 30, 2015, respectively, related to these warrants. On the May 7, 2015 vesting date, we reclassified the $35,001 estimated fair value of the warrants to stockholders’ equity. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Stockholders' Equity | 9. Stockholders’ Equity Preferred Stock Our authorized preferred stock includes 10,000,000 shares of preferred stock with a par value of $0.001, of which no shares have been issued or are outstanding. Common Stock – Our authorized common stock includes 200,000,000 shares of common stock with a par value of $0.001, of which 111,714,938 and 111,601,304 shares were issued and outstanding as of September 30, 2015 and December 31, 2014, respectively. During the nine months ended September 30, 2015, we issued shares of common stock as follows: Common Stock Shares Amount Shares issued for vested restricted stock units 56,500 $ — Shares issued for Employee Stock Purchase Plan options 57,134 60,705 113,634 $ 60,705 · Shares Issued for Vested Restricted Stock Units – o On March 5, 2015, we issued 56,500 shares to an employee for the restricted stock units that vested and were expensed during fiscal year 2014. · Shares Issued for Employee Stock Purchase Plan Options – o On May 15, 2015, we issued 57,134 shares to employees for the Employee Stock Purchase Plan options that vested and were exercised. Warrants – During the nine months ended September 30, 2015, we did not issue any warrants and no holders exercised warrants. During the nine months ended September 30, 2014, we issued 12,291,000 warrants. During the nine months ended September 30, 2015, a third party forfeited 1,200,000 contingent warrants, with no corresponding forfeitures or expirations during the nine months ended September 30, 2014. Due to the uncertainty of attaining any of the performance conditions, we had not recognized any additional expense for the non-vested warrants. As these warrants related to internally developed software, we did not capitalize any costs or recognize any expense for the nine months ended September 30, 2015. At September 30, 2015, we had outstanding exercisable warrants to purchase 11,791,000 shares of common stock. The following table summarizes the warrants issued and outstanding as of September 30, 2015: Warrants Issued and Outstanding as of September 30, 2015 Date of Exercise Shares of Description Issuance Expiration Price Common Stock Exercisable warrants Warrants 04/18/2014 04/01/2017 $ 2.00 1,441,000 Warrant 05/07/2014 05/07/2017 $ 2.65 200,000 Warrant 05/28/2014 10/31/2016 $ 4.31 450,000 Warrants 09/24/2014 09/24/2019 $ 2.50 9,000,000 Warrants 10/20/2014 10/20/2019 $ 2.50 700,000 Total exercisable warrants 11,791,000 Contingent warrants Warrants 05/28/2014 10/31/2018 $ 4.31 1,200,000 Less warrants cancelled (1,200,000 ) Total contingent warrants — Total warrants issued and outstanding 11,791,000 Restricted Stock Units – During April 2014, we granted restricted stock units representing 132,600 shares of common stock under our 2012 Incentive Compensation Plan. The restricted stock units vest based on a combination of financial performance factors and continued service. The financial performance factors are based on the revenue generated by new business activity of one of our subsidiaries. All payouts of restricted stock units that vest will be exercisable immediately and will be paid in the form of common stock. While we do not anticipate issuing dividends, the restricted stock unit awards will not participate in any dividends prior to vesting. We determined the fair value of the restricted stock unit awards granted based on the market value of our common stock on the date of grant, which was $3.75 per share. Due to the uncertainty of attaining any of the remaining performance conditions, we recorded no additional stock-based compensation expense for the remaining performance conditions for the nine months ended September 30, 2015. We issued 56,500 shares during the nine months ended September 30, 2015 for the restricted stock units that vested during 2014. As of September 30, 2015 and December 31, 2014, outstanding restricted stock units totaled 76,100 and 132,600, respectively. Employee Stock Purchase Plan – On September 17, 2014, our stockholders approved the Quest Resource Holding Corporation 2014 Employee Stock Purchase Plan (the “ESPP”). We recorded expense of $17,723 and $54,647 related to the ESPP during the three and nine months ended September 30, 2015, respectively, with no corresponding expense during the three and nine months ended September 30, 2014. On May 15, 2015, we issued 57,134 shares to employees for the ESPP options that vested and were exercised. Stock Options – The following table summarizes the stock option activity for the nine month period ended September 30, 2015: Stock Options Weighted- Exercise Average Number Price Per Exercise Price of Shares Share Per Share Outstanding at December 31, 2014 5,006,532 $ 1.45 — 3.75 $ 2.66 Granted 155,625 $ 0.93 — 1.46 $ 1.23 Canceled/Forfeited (759,418 ) $ 1.28 — 2.10 $ 2.04 Outstanding at September 30, 2015 4,402,739 $ 0.93 — 3.75 $ 2.64 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 10. Related Party Transactions Acquisition of the Quest Interests – On July 16, 2013, we acquired all of the issued and outstanding membership interests of Quest held by QRG, comprising 50% of the membership interests of Quest (the “Quest Interests”). The purchase price for the Quest Interests consisted of 22,000,000 shares of our common stock issued at a fair market value of $2.50 per share based on the closing price of the stock on the date of the transaction and the Sellers Notes in the aggregate principal amount of $22,000,000. The total purchase price of $77,000,000 was paid to the owners of QRG who were related parties: the Chief Executive Officer of Quest and the former President of Quest until his resignation in October 2015, and the former President of Quest became a member of the Board of Directors of our company. After the close of the transaction, the Chief Executive Officer of Quest became the President, Chief Executive Officer, and member of the Board of Directors of our company. On September 24, 2014, we paid $11,000,000 to the holders of the Sellers’ Notes and such holders converted the remaining $11,000,000 of principal, plus accrued interest through September 24, 2014 of $101,260, into 5,550,630 shares of our common stock. See Note 6 for a discussion of the conversion. |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Principals of Presentation and Consolidation | Principals of Presentation and Consolidation The condensed consolidated financial statements included herein have been prepared by us without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended December 31, 2014. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted, as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading. The accompanying condensed consolidated financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position at September 30, 2015 and the results of our operations and cash flows for the periods presented. We derived the December 31, 2014 condensed consolidated balance sheet data from audited financial statements, but did not include all disclosures required by GAAP. As Quest, Earth911, and YouChange each operate as ecology based green service companies, we did not deem segment reporting necessary. All intercompany accounts and transactions have been eliminated in consolidation. Interim results are subject to seasonal variations, and the results of operations for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the full year. |
Revenue Recognition | Revenue Recognition We recognize revenue only when all of the following criteria have been met: · persuasive evidence of an arrangement exists; · delivery has occurred or services have been rendered; · the fee for the arrangement is fixed or determinable; and · collectability is reasonably assured. Persuasive Evidence of an Arrangement Exists – We document all terms of an arrangement in a service agreement or quote signed or confirmed by the customer prior to recognizing revenue. Delivery Has Occurred or Services Have Been Rendered – We perform all services or deliver all products prior to recognizing revenue. Services are deemed to be performed when the services are complete. The Fee for the Arrangement is Fixed or Determinable – Prior to recognizing revenue, a customer’s fee is either fixed or determinable under the terms of the quote, service agreement, or accepted customer purchase order. Collectability Is Reasonably Assured – We assess collectability on a customer by customer basis based on criteria outlined by management. We provide businesses with management programs to reuse, recycle, and dispose of a wide variety of waste streams and recyclables generated by their business. We utilize third-party subcontractors to execute the collection, transport, and recycling or disposal of used motor oil, oil filters, scrap tires, cooking oil, and expired food products. We evaluate the criteria outlined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Subtopic 605-45, Revenue Recognition—Principal Agent Considerations Earth911 revenue primarily represents licensing fees that we recognize ratably over the term of the license. We derive some revenue from advertising contracts, which we recognize ratably over the term that the advertisement appears on our website. |
Net Loss Per Share | Net Loss Per Share We compute basic net loss per share by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. We have other potentially dilutive securities outstanding that are not shown in a diluted net loss per share calculation because their effect in both 2015 and 2014 would be anti-dilutive. These potentially dilutive securities include options, restricted stock units, and warrants and totaled 16,269,839 and 17,122,532 shares at September 30, 2015 and 2014, respectively. The following table sets forth the anti-dilutive securities excluded from diluted loss per share: September 30, 2015 2014 (Unaudited) (Unaudited) Anti-dilutive securities excluded from diluted loss per share: Stock options 4,402,739 4,831,532 Restricted stock units 76,100 — Warrants 11,791,000 12,291,000 16,269,839 17,122,532 |
Inventories | Inventories We record inventories within “Prepaid expenses and other current assets” in our condensed consolidated balance sheets. As of September 30, 2015 and December 31, 2014, all inventories were finished goods with a balance of $13,377 and $30,759, respectively, and consisted of waste disposal equipment, with no reserve for inventory obsolescence at either date. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Schedule of Anti-dilutive Securities Excluded from Diluted Loss Per Share | The following table sets forth the anti-dilutive securities excluded from diluted loss per share: September 30, 2015 2014 (Unaudited) (Unaudited) Anti-dilutive securities excluded from diluted loss per share: Stock options 4,402,739 4,831,532 Restricted stock units 76,100 — Warrants 11,791,000 12,291,000 16,269,839 17,122,532 |
Property and Equipment, Net, 19
Property and Equipment, Net, and Other Assets (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property Plant And Equipment [Abstract] | |
Components Property and Equipment, net, and other assets | At September 30, 2015 and December 31, 2014, property and equipment, net, and other assets consisted of the following: September 30, December 31, 2015 2014 (Unaudited) Property and equipment, net of accumulated depreciation of $1,895,096 and $1,692,835 as of September 30, 2015 and December 31, 2014, respectively $ 1,253,093 $ 533,837 Security deposits and other assets 209,942 219,656 Property and equipment, net, and other assets $ 1,463,035 $ 753,493 |
Goodwill and Other Intangible20
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The components of goodwill and other intangible assets were as follows: September 30, 2015 (Unaudited) Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Finite lived intangible assets: Customer relationships 5 years $ 12,720,000 $ 5,618,000 $ 7,102,000 Trademarks 7 years 6,230,000 1,965,417 4,264,583 Patents 7 years 230,683 230,683 — Software 7 years 1,754,285 126,677 1,627,608 Customer lists 5 years 307,153 167,507 139,646 Total finite lived intangible assets $ 21,242,121 $ 8,108,284 $ 13,133,837 December 31, 2014 Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Finite lived intangible assets: Customer relationships 5 years $ 12,720,000 $ 3,710,000 $ 9,010,000 Trademarks 7 years 6,230,000 1,297,917 4,932,083 Patents 7 years 230,683 230,683 — Software 7 years 1,013,714 25,899 987,815 Customer lists 5 years 307,153 121,434 185,719 Total finite lived intangible assets $ 20,501,550 $ 5,385,933 $ 15,115,617 |
Schedule of Indefinite-Lived Intangible Assets | September 30, 2015 (Unaudited) and December 31, 2014 Estimated Useful Life Carrying Amount Indefinite lived intangible asset: Goodwill Indefinite $ 58,337,290 |
Long-Term Debt and Capital Le21
Long-Term Debt and Capital Lease Obligations (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Summary of Capital Lease Obligations | At September 30, 2015 and December 31, 2014, total capital lease obligations outstanding consisted of the following: September 30, December 31, 2015 2014 (Unaudited) Capital lease obligations, imputed interest at 4.75% to 4.87%, with monthly payments of $5,507, through August 2018, secured by computer and telephone equipment $ 143,025 $ 47,250 Total 143,025 47,250 Less: current maturities (60,592 ) (22,853 ) Long-term portion $ 82,433 $ 24,397 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Schedule of Common Stock Shares Issued | During the nine months ended September 30, 2015, we issued shares of common stock as follows: Common Stock Shares Amount Shares issued for vested restricted stock units 56,500 $ — Shares issued for Employee Stock Purchase Plan options 57,134 60,705 113,634 $ 60,705 |
Summary Of Warrant Activity | The following table summarizes the warrants issued and outstanding as of September 30, 2015: Warrants Issued and Outstanding as of September 30, 2015 Date of Exercise Shares of Description Issuance Expiration Price Common Stock Exercisable warrants Warrants 04/18/2014 04/01/2017 $ 2.00 1,441,000 Warrant 05/07/2014 05/07/2017 $ 2.65 200,000 Warrant 05/28/2014 10/31/2016 $ 4.31 450,000 Warrants 09/24/2014 09/24/2019 $ 2.50 9,000,000 Warrants 10/20/2014 10/20/2019 $ 2.50 700,000 Total exercisable warrants 11,791,000 Contingent warrants Warrants 05/28/2014 10/31/2018 $ 4.31 1,200,000 Less warrants cancelled (1,200,000 ) Total contingent warrants — Total warrants issued and outstanding 11,791,000 |
Summary of Stock Option Activity | Stock Options – The following table summarizes the stock option activity for the nine month period ended September 30, 2015: Stock Options Weighted- Exercise Average Number Price Per Exercise Price of Shares Share Per Share Outstanding at December 31, 2014 5,006,532 $ 1.45 — 3.75 $ 2.66 Granted 155,625 $ 0.93 — 1.46 $ 1.23 Canceled/Forfeited (759,418 ) $ 1.28 — 2.10 $ 2.04 Outstanding at September 30, 2015 4,402,739 $ 0.93 — 3.75 $ 2.64 |
The Company, Description of B23
The Company, Description of Business, and Liquidity - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($) | Sep. 30, 2014 | Sep. 30, 2015USD ($)Customer | Sep. 30, 2014 | Dec. 31, 2014USD ($) | |
Concentration Risk [Line Items] | |||||
Working capital | $ 1,999,532 | $ 1,999,532 | $ 1,316,319 | ||
Revenue [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of customer | Customer | 2 | ||||
Revenue [Member] | Customer Accounted [Member] | |||||
Concentration Risk [Line Items] | |||||
Percentage of revenue | 60.00% | 72.20% | 60.20% | 73.70% |
Summary of Significant Accoun24
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Accounting Policies [Abstract] | |||
Potentially dilutive securities include options, restricted stock units, and warrants | 16,269,839 | 17,122,532 | |
Finished goods inventory | $ 13,377 | $ 30,759 | |
Reserve for inventory obsolescence | $ 0 |
Summary of Significant Accoun25
Summary of Significant Accounting Policies - Schedule of Anti-dilutive Securities Excluded from Diluted Loss Per Share (Detail) - shares | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from diluted loss per share | 16,269,839 | 17,122,532 |
Stock options [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from diluted loss per share | 4,402,739 | 4,831,532 |
Restricted Stock Units [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from diluted loss per share | 76,100 | |
Warrant [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from diluted loss per share | 11,791,000 | 12,291,000 |
Property and Equipment, Net, 26
Property and Equipment, Net, and Other Assets - Components of Property and Equipment,net,and other assets (Detail) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Property Plant And Equipment [Abstract] | ||
Property and equipment, net of depreciation | $ 1,253,093 | $ 533,837 |
Security deposits and other assets | 209,942 | 219,656 |
Property and Equipment net and other assets | $ 1,463,035 | $ 753,493 |
Property and Equipment, Net, 27
Property and Equipment, Net, and Other Assets - Components of Property and Equipment,net,and other assets ( Parenthetical) (Detail) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Property Plant And Equipment [Abstract] | ||
Accumulated depreciation, Property and equipment | $ 1,895,096 | $ 1,692,835 |
Property and Equipment, Net, 28
Property and Equipment, Net, and Other Assets - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation | $ 71,844 | $ 81,038 | $ 218,225 | $ 223,499 |
Goodwill and Other Intangible29
Goodwill and Other Intangible Assets - Schedule of Finite-Lived Intangible Assets (Detail) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 21,242,121 | $ 20,501,550 |
Accumulated Amortization | 8,108,284 | 5,385,933 |
Net | $ 13,133,837 | $ 15,115,617 |
Customer relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | 5 years |
Gross Carrying Amount | $ 12,720,000 | $ 12,720,000 |
Accumulated Amortization | 5,618,000 | 3,710,000 |
Net | $ 7,102,000 | $ 9,010,000 |
Trademarks [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 7 years | 7 years |
Gross Carrying Amount | $ 6,230,000 | $ 6,230,000 |
Accumulated Amortization | 1,965,417 | 1,297,917 |
Net | $ 4,264,583 | $ 4,932,083 |
Patents [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 7 years | 7 years |
Gross Carrying Amount | $ 230,683 | $ 230,683 |
Accumulated Amortization | $ 230,683 | $ 230,683 |
Software [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 7 years | 7 years |
Gross Carrying Amount | $ 1,754,285 | $ 1,013,714 |
Accumulated Amortization | 126,677 | 25,899 |
Net | $ 1,627,608 | $ 987,815 |
Customer lists [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | 5 years |
Gross Carrying Amount | $ 307,153 | $ 307,153 |
Accumulated Amortization | 167,507 | 121,434 |
Net | $ 139,646 | $ 185,719 |
Goodwill and Other Intangible30
Goodwill and Other Intangible Assets - Schedule of Indefinite-Lived Intangible Assets (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Goodwill Useful Life Description | Indefinite | |
Goodwill | $ 58,337,290 | $ 58,337,290 |
Goodwill and Other Intangible31
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangibles | $ 917,261 | $ 875,740 | $ 2,722,351 | $ 2,638,441 |
Indefinite-lived intangible assets other than goodwill | $ 0 | |||
Impairment of goodwill | $ 0 |
Line of Credit - Additional Inf
Line of Credit - Additional Information (Detail) | Jul. 07, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Amendment | Sep. 30, 2014USD ($) |
Line of Credit Facility [Line Items] | |||||
Outstanding principal amount on line of credit facility | $ 3,000,000 | $ 3,000,000 | |||
Interest expense related to line of credit facility | 72,758 | $ 2,494,060 | $ 163,591 | $ 4,259,980 | |
Number of amendments | Amendment | 2 | ||||
Seventh Amendment to Loan Agreement with Regions Bank [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Maturity date of loan agreement with Regions Bank | May 13, 2018 | ||||
Eighth Amendment To Loan Agreement with Regions [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Working capital from loan agreement with Regions Bank | $ 15,000,000 | ||||
Line of credit, accordion feature | $ 5,000,000 | ||||
Eurodollar [Member] | Seventh Amendment to Loan Agreement with Regions Bank [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Decrease in applicable margin rate of loans during the period | 0.25% | ||||
Revolving Credit Note and Loan Agreement with Regions Bank (“Regions”) [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility agreement date | Dec. 15, 2010 | ||||
Working capital from loan agreement with Regions Bank | $ 15,000,000 | $ 15,000,000 | |||
Interest on outstanding principal amount | 2.46% | 2.46% | |||
Outstanding principal amount on line of credit facility | $ 3,000,000 | $ 3,000,000 | |||
Amount available to be borrow under line of credit facility | 12,000,000 | $ 12,000,000 | |||
Interest rate line of credit facility description | The base rate for any day is the greater of (a) the federal funds rate plus one-half of 1%, (b) Region’s published effective prime rate, or (c) the Eurodollar rate for such day based on an interest period of one month. | ||||
Interest expense related to line of credit facility | $ 65,026 | $ 35,607 | $ 153,555 | $ 127,991 | |
Maturity date of loan agreement with Regions Bank | May 13, 2018 | ||||
Revolving Credit Note and Loan Agreement with Regions Bank (“Regions”) [Member] | Base Rate [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Fluctuating interest rate based on base rate | 1.50% | ||||
Revolving Credit Note and Loan Agreement with Regions Bank (“Regions”) [Member] | Eligible Accounts Receivable [Member] | Largest Customer [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Percentage of accounts receivable form Quest's customers | 80.00% | 80.00% | |||
Revolving Credit Note and Loan Agreement with Regions Bank (“Regions”) [Member] | Eligible Accounts Receivable [Member] | Other Customer [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Percentage of accounts receivable form Quest's customers | 85.00% | 85.00% |
Long-Term Debt and Capital Le33
Long-Term Debt and Capital Lease Obligations - Summary of Capital Lease Obligations (Detail) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Leases [Abstract] | ||
Capital lease obligations, imputed interest at 4.75% to 4.87%, with monthly payments of $5,507, through August 2018, secured by computer and telephone equipment | $ 143,025 | $ 47,250 |
Total | 143,025 | 47,250 |
Less: current maturities | (60,592) | (22,853) |
Long-term portion | $ 82,433 | $ 24,397 |
Long-Term Debt and Capital Le34
Long-Term Debt and Capital Lease Obligations - Summary of Capital Lease Obligations (Parenthetical) (Detail) - Capital lease obligations, imputed interest at 4.75% to 4.87% [Member] - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||
Imputed interest rate for capital lease obligation, minimum | 4.75% | 4.75% |
Imputed interest rate for capital lease obligation, maximum | 4.87% | 4.87% |
Monthly installment capital lease obligation | $ 5,507 | $ 5,507 |
Long-Term Debt and Capital Le35
Long-Term Debt and Capital Lease Obligations - Additional Information (Detail) - USD ($) | Sep. 24, 2014 | Jul. 16, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 |
Long Term Debt And Equity Financings [Line Items] | |||||||
Interest expense related to capital leases | $ 833 | $ 767 | $ 1,746 | $ 1,857 | |||
Principal amount of each sellers note paid down by first capital rise | $ 5,000,000 | ||||||
Common stock conversion adjusted | common stock has traded at four times the $2.00 conversion price, as adjusted for any stock splits, reverse stock splits, or both | ||||||
Interest expense on seller notes | $ 72,758 | 2,494,060 | $ 163,591 | 4,259,980 | |||
Interest expense conversion of debt | $ 1,658,531 | ||||||
Loss on extinguishment of debt | 1,658,531 | $ (1,658,531) | (1,658,531) | ||||
Intrinsic value of debt extinguishment | 0 | ||||||
Interest Expense, Subordinated Notes and Debentures | 0 | 1,126,521 | |||||
Amortization of debt discount on the seller notes | $ 0 | $ 2,998,403 | |||||
Chief Executive Officer of Quest and Former President of Quest [Member] | Sellers Notes [Member] | |||||||
Long Term Debt And Equity Financings [Line Items] | |||||||
Repaid of sellers notes using proceeds | 11,000,000 | ||||||
Interest expense on seller notes | $ 101,260 | ||||||
Number of shares converted in to common stock | 5,550,630 | ||||||
Convertible Secured Promissory Notes [Member] | |||||||
Long Term Debt And Equity Financings [Line Items] | |||||||
Annual interest rate on convertible note | 7.00% | ||||||
Notes accrue interest payable beginning | Sep. 5, 2013 | ||||||
Notes accrue interest payable in one installment | Jul. 16, 2016 | ||||||
Conversion price of notes to common stock | $ 2 | $ 2 | |||||
Convertible note beneficial conversion feature | $ 5,500,000 | ||||||
Convertible note accrued interest | $ 0 | ||||||
Convertible Secured Promissory Notes [Member] | Chief Executive Officer of Quest and Former President of Quest [Member] | |||||||
Long Term Debt And Equity Financings [Line Items] | |||||||
Convertible secured promissory note principle amount payable | $ 22,000,000 | ||||||
Percentage of Security interest, secured | 25.00% | ||||||
Percentage of ownership by officials before acquisition | 50.00% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | ||
Valuation allowance | $ 8,400,000 | $ 9,108,000 |
Federal income tax net operating loss carry forward | $ 12,000,000 | $ 14,800,000 |
Net Operating Loss Carry Forwards Expiration Dates | various dates beginning in 2031 |
Fair Value of Financial Instr37
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) | May. 07, 2015 | Sep. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | May. 07, 2014 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||||||
Warrants issued | 100,000 | 0 | 0 | 12,291,000 | 200,000 | |
Warrant liability during the period | $ 0 | $ 0 | $ 34,857 | |||
Reclassification of fair value warrants to equity | $ 35,001 | |||||
Warrant [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||||||
Stock-based compensation expense | $ 0 | $ 144 | ||||
Warrant Exercisable Immediately [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||||||
Warrants issued | 100,000 | |||||
Black-Scholes-Merton Valuation Model [Member] | ||||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||||||
Fair value assumption, expected volatility | 88.50% | |||||
Fair value assumption, risk free interest rate | 0.63% | |||||
Fair value assumption, expected term | 2 years | |||||
Fair value assumption, expected dividend yield | 0.00% | |||||
Grant date fair value of the initial warrant valuation | $ 0.35 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | May. 15, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 |
Equity [Abstract] | ||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Preferred stock, shares issued | 0 | 0 | 0 | |||
Preferred stock, shares outstanding | 0 | 0 | 0 | |||
Common stock, shares authorized | 200,000,000 | 200,000,000 | 200,000,000 | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Common stock, shares issued | 111,714,938 | 111,714,938 | 111,601,304 | |||
Common stock, shares outstanding | 111,714,938 | 111,714,938 | 111,601,304 | |||
Employee stock purchase plan expense | $ 17,723 | $ 0 | $ 54,647 | $ 0 | ||
Shares issued for Employee Stock Purchase Plan options, Shares | 57,134 | 57,134 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Common Stock Shares Issued (Detail) - USD ($) | May. 15, 2015 | Sep. 30, 2015 |
Equity [Abstract] | ||
Shares issued for vested restricted stock units, Shares | 56,500 | |
Shares issued for Employee Stock Purchase Plan options, Shares | 57,134 | 57,134 |
Total common stock shares | 113,634 | |
Shares issued for Employee Stock Purchase Plan options, Value | $ 60,705 | |
Total common stock amount | $ 60,705 |
Stockholders' Equity - Additi40
Stockholders' Equity - Additional Information - Shares Issued for Vested Restricted Stock Units (Detail) - shares | Mar. 05, 2015 | Sep. 30, 2015 |
Schedule Of Stockholders Equity [Line Items] | ||
Shares issued for vested restricted stock units, Shares | 56,500 | |
Employee [Member] | ||
Schedule Of Stockholders Equity [Line Items] | ||
Shares issued for vested restricted stock units, Shares | 56,500 |
Stockholders' Equity - Additi41
Stockholders' Equity - Additional Information - Shares Issued for Employee Stock Purchase Plan Options (Detail) - shares | May. 15, 2015 | Sep. 30, 2015 |
Equity [Abstract] | ||
Shares issued for Employee Stock Purchase Plan options, Shares | 57,134 | 57,134 |
Stockholders' Equity - Additi42
Stockholders' Equity - Additional Information - Warrants (Detail) - USD ($) | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | May. 07, 2015 | May. 07, 2014 | |
Class Of Warrant Or Right [Line Items] | ||||
Warrants issued | 0 | 12,291,000 | 100,000 | 200,000 |
Number of exercised warrants | 0 | |||
Number of warrants expired | 0 | |||
Warrants outstanding | 11,791,000 | |||
Contingent Warrants [Member] | ||||
Class Of Warrant Or Right [Line Items] | ||||
Warrants forfeited | 1,200,000 | |||
Contingent Warrants [Member] | Internally-Developed Software [Member] | ||||
Class Of Warrant Or Right [Line Items] | ||||
Warrants related to intangible assets | $ 0 | |||
Exercisable Warrants [Member] | ||||
Class Of Warrant Or Right [Line Items] | ||||
Warrants outstanding | 11,791,000 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Warrants Issued and Outstanding (Detail) | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Class Of Warrant Or Right [Line Items] | |
Shares of Common Stock | 11,791,000 |
Exercisable Warrants [Member] | |
Class Of Warrant Or Right [Line Items] | |
Shares of Common Stock | 11,791,000 |
Exercisable Warrants [Member] | Warrants One [Member] | |
Class Of Warrant Or Right [Line Items] | |
Date of Issuance | Apr. 18, 2014 |
Date of Expiration | Apr. 1, 2017 |
Exercise Price | $ / shares | $ 2 |
Shares of Common Stock | 1,441,000 |
Exercisable Warrants [Member] | Warrant Two [Member] | |
Class Of Warrant Or Right [Line Items] | |
Date of Issuance | May 7, 2014 |
Date of Expiration | May 7, 2017 |
Exercise Price | $ / shares | $ 2.65 |
Shares of Common Stock | 200,000 |
Exercisable Warrants [Member] | Warrants Three [Member] | |
Class Of Warrant Or Right [Line Items] | |
Date of Issuance | May 28, 2014 |
Date of Expiration | Oct. 31, 2016 |
Exercise Price | $ / shares | $ 4.31 |
Shares of Common Stock | 450,000 |
Exercisable Warrants [Member] | Warrants Four [Member] | |
Class Of Warrant Or Right [Line Items] | |
Date of Issuance | Sep. 24, 2014 |
Date of Expiration | Sep. 24, 2019 |
Exercise Price | $ / shares | $ 2.50 |
Shares of Common Stock | 9,000,000 |
Exercisable Warrants [Member] | Warrant Five [Member] | |
Class Of Warrant Or Right [Line Items] | |
Date of Issuance | Oct. 20, 2014 |
Date of Expiration | Oct. 20, 2019 |
Exercise Price | $ / shares | $ 2.50 |
Shares of Common Stock | 700,000 |
Contingent Warrants [Member] | |
Class Of Warrant Or Right [Line Items] | |
Less warrants cancelled | (1,200,000) |
Contingent Warrants [Member] | Warrant Six [Member] | |
Class Of Warrant Or Right [Line Items] | |
Date of Issuance | May 7, 2014 |
Date of Expiration | May 7, 2017 |
Exercise Price | $ / shares | $ 4.31 |
Shares of Common Stock | 1,200,000 |
Stockholders' Equity - Additi44
Stockholders' Equity - Additional Information - Restricted Stock Units (Detail) - USD ($) | 1 Months Ended | 9 Months Ended | |
Apr. 30, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares issued for vested restricted stock units, Shares | 56,500 | ||
Restricted Stock Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Fair value of restricted stock unit | $ 3.75 | ||
Stock-based compensation expense | $ 0 | ||
Outstanding restricted stock unit | 76,100 | 132,600 | |
2012 Incentive Compensation Plan [Member] | Restricted Stock Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares granted | 132,600 |
Stockholders' Equity - Summar45
Stockholders' Equity - Summary of Stock Option Activity (Detail) | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Outstanding Beginning Balance, Number of Shares | shares | 5,006,532 |
Granted, Number of Shares | shares | 155,625 |
Canceled/Forfeited, Number of Shares | shares | (759,418) |
Outstanding Ending Balance, Number of Shares | shares | 4,402,739 |
Outstanding Beginning Balance, Weighted-Average Exercise Price Per Share | $ 2.66 |
Granted, Weighted-Average Exercise Price Per Share | 1.23 |
Canceled/Forfeited, Weighted Average Exercise Price Per Share | 2.04 |
Outstanding Ending Balance, Weighted Average Exercise Price Per Share | 2.64 |
Outstanding, 1.45-3.75 [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Exercise Price Per Share, Minimum | 1.45 |
Exercise Price Per Share, Maximum | 3.75 |
Granted, 1.11-1.46 [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Exercise Price Per Share, Minimum | 0.93 |
Exercise Price Per Share, Maximum | 1.46 |
Canceled/Forfeited, 1.45-2.10 [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Exercise Price Per Share, Minimum | 1.28 |
Exercise Price Per Share, Maximum | 2.10 |
Outstanding, 1.11-3.75 [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Exercise Price Per Share, Minimum | 0.93 |
Exercise Price Per Share, Maximum | $ 3.75 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) | Sep. 24, 2014 | Jul. 16, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Related Party Transaction [Line Items] | ||||||
Interest expense on seller notes | $ 72,758 | $ 2,494,060 | $ 163,591 | $ 4,259,980 | ||
Chief Executive Officer of Quest and Former President of Quest [Member] | Sellers Notes [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Repayment of debt | $ 11,000,000 | |||||
Repaid of sellers notes using proceeds | 11,000,000 | |||||
Interest expense on seller notes | $ 101,260 | |||||
Number of shares converted in to common stock | 5,550,630 | |||||
Chief Executive Officer of Quest and Former President of Quest [Member] | Quest Interests [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Notes accrue interest payable beginning | Jul. 16, 2013 | |||||
Percentage of remaining ownership interest acquired | 50.00% | |||||
Business acquisition shares issued | 22,000,000 | |||||
Sellers Notes in the aggregate principal amount | $ 22,000,000 | |||||
Business acquisition, share price | $ 2.50 | |||||
Business acquisition , consideration paid | $ 77,000,000 |