Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 08, 2023 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-36103 | |
Entity Registrant Name | TECOGEN INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 04-3536131 | |
Entity Address, Address Line One | 45 First Avenue | |
Entity Address, City or Town | Waltham | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02451 | |
City Area Code | 781 | |
Local Phone Number | 466-6402 | |
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 | 24,850,261 | |
Entity Central Index Key | 0001537435 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Current assets: | |||
Cash and cash equivalents | $ 646,161 | $ 1,913,969 | |
Accounts receivable, net | 7,694,571 | 6,714,122 | |
Unbilled revenue | 1,748,336 | 1,805,330 | |
Employee retention credit receivable | 46,148 | 713,269 | |
Inventories, net | 11,039,313 | 10,482,729 | |
Prepaid and other current assets | 420,317 | 401,189 | |
Total current assets | 21,594,846 | 22,030,608 | |
Property, plant and equipment, net | 1,254,656 | 1,407,720 | |
Right of use assets | 754,957 | 1,245,549 | |
Intangible assets, net | 2,307,902 | 997,594 | |
Goodwill | 3,129,147 | 2,406,156 | |
Other assets | 145,237 | 165,230 | |
TOTAL ASSETS | 29,186,745 | 28,252,857 | $ 30,071,323 |
Current liabilities: | |||
Accounts payable | 4,493,758 | 3,261,952 | |
Accrued expenses | 2,632,607 | 2,384,447 | |
Deferred revenue, current | 1,655,737 | 1,115,627 | |
Lease obligations, current | 367,938 | 687,589 | |
Acquisition liabilities, current | 775,991 | 0 | |
Unfavorable contract liability, current | 201,090 | 236,705 | |
Total current liabilities | 10,127,121 | 7,686,320 | |
Long-term liabilities: | |||
Deferred revenue, net of current portion | 290,226 | 371,823 | |
Lease obligations, net of current portion | 429,737 | 623,452 | |
Acquisition liabilities, net of current portion | 1,485,677 | 0 | |
Unfavorable contract liability, net of current portion | 448,695 | 583,512 | |
Total liabilities | 12,781,456 | 9,265,107 | |
Commitments and contingencies (Note 12) | |||
Tecogen Inc. shareholders’ equity: | |||
Common stock, $0.001 par value; 100,000,000 shares authorized; 24,850,261 and 24,850,261 issued and outstanding at June 30,2021 and December 31, 2020, respectively | 24,850 | 24,850 | |
Additional paid-in capital | 57,525,719 | 57,351,008 | |
Accumulated deficit | (41,033,259) | (38,281,548) | |
Total Tecogen Inc. stockholders’ equity | 16,517,310 | 19,094,310 | |
Non-controlling interest | (112,021) | (106,560) | |
Total stockholders’ equity | 16,405,289 | 18,987,750 | $ 20,358,139 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 29,186,745 | $ 28,252,857 | |
Common stock, shares outstanding | 24,850,261 | 24,850,261 | |
Common stock, shares issued | 24,850,261 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 24,850,261 | |
Common stock, shares outstanding | 24,850,261 | 24,850,261 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Total revenues | $ 7,112,530 | $ 6,618,110 | $ 19,241,106 | $ 20,471,026 |
Total cost of sales | 4,186,509 | 3,724,776 | 11,388,750 | 11,783,455 |
Gross profit | 2,926,021 | 2,893,334 | 7,852,356 | 8,687,571 |
Operating expenses | ||||
General and administrative | 2,708,817 | 2,343,449 | 8,418,581 | 7,642,183 |
Selling | 425,465 | 567,529 | 1,426,321 | 1,572,221 |
Research and development | 160,033 | 202,138 | 625,691 | 537,126 |
Gain on disposition of assets | 0 | (5,486) | (19,950) | (41,931) |
Gain on termination of unfavorable contract liability | 0 | (71,375) | ||
Total operating expenses | 3,294,315 | 3,107,630 | 10,450,643 | 9,638,224 |
Loss from operations | (368,294) | (214,296) | (2,598,287) | (950,653) |
Other income (expense) | ||||
Interest income and other income (expense), net | (16,330) | (7,140) | (36,562) | (22,556) |
Interest expense | (6,357) | (2,280) | (8,629) | (15,841) |
Unrealized gain (loss) on investment securities | (56,246) | 0 | (18,749) | 37,497 |
Total other income (expense), net | (78,933) | (9,420) | (63,940) | (900) |
Loss before provision for state income taxes | (447,227) | (223,716) | (2,662,227) | (951,553) |
Provision for state income taxes | 0 | 5,922 | 32,252 | 16,352 |
Consolidated net loss | (447,227) | (229,638) | (2,694,479) | (967,905) |
Income attributable to the non-controlling interest | (34,346) | (27,074) | (57,232) | (55,616) |
Net loss attributable to Tecogen Inc. | $ (481,573) | $ (256,712) | $ (2,751,711) | $ (1,023,521) |
Earnings Per Share [Abstract] | ||||
Net income (loss) per share - basic (in USD per share) | $ (0.02) | $ (0.01) | $ (0.11) | $ (0.04) |
Net income (loss) per share - diluted (in usd per share) | $ (0.02) | $ (0.01) | $ (0.11) | $ (0.04) |
Weighted average shares outstanding - basic | 24,850,261 | 24,850,261 | 24,850,261 | 24,850,261 |
Weighted average shares outstanding - diluted | 24,850,261 | 24,850,261 | 24,850,261 | 24,850,261 |
Products | ||||
Total revenues | $ 2,938,789 | $ 3,206,732 | $ 7,094,556 | $ 10,156,328 |
Total cost of sales | 1,669,747 | 2,074,243 | 4,500,771 | 6,734,465 |
Services | ||||
Total revenues | 3,842,600 | 3,078,604 | 10,931,744 | 9,046,075 |
Total cost of sales | 2,346,384 | 1,482,355 | 6,159,855 | 4,322,693 |
Energy production | ||||
Total revenues | 331,141 | 332,774 | 1,214,806 | 1,268,623 |
Total cost of sales | $ 170,378 | $ 168,178 | $ 728,124 | $ 726,297 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity Statement - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Noncontrolling Interest |
Beginning balance (shares) at Dec. 31, 2021 | 24,850,261 | ||||
Beginning balance at Dec. 31, 2021 | $ 21,128,149 | $ 24,850 | $ 57,016,859 | $ (35,833,621) | $ (79,939) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock based compensation expense | 254,718 | 254,718 | |||
Distributions to Noncontrolling interests | (56,823) | 56,823 | |||
Net income | (55,616) | 1,023,521 | |||
Net income (loss) | (967,905) | 55,616 | |||
Ending balance (shares) at Sep. 30, 2022 | 24,850,261 | ||||
Ending balance at Sep. 30, 2022 | 20,358,139 | $ 24,850 | 57,271,577 | (36,857,142) | (81,146) |
Beginning balance (shares) at Jun. 30, 2022 | 24,850,261 | ||||
Beginning balance at Jun. 30, 2022 | 20,542,673 | $ 24,850 | 57,202,459 | (36,600,430) | (84,206) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock based compensation expense | 69,118 | 69,118 | |||
Distributions to Noncontrolling interests | (24,014) | 24,014 | |||
Net income | (27,074) | 256,712 | |||
Net income (loss) | (229,638) | 27,074 | |||
Ending balance (shares) at Sep. 30, 2022 | 24,850,261 | ||||
Ending balance at Sep. 30, 2022 | 20,358,139 | $ 24,850 | 57,271,577 | (36,857,142) | (81,146) |
Beginning balance (shares) at Dec. 31, 2022 | 24,850,261 | ||||
Beginning balance at Dec. 31, 2022 | 18,987,750 | $ 24,850 | 57,351,008 | (38,281,548) | (106,560) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock based compensation expense | 174,711 | 174,711 | |||
Distributions to Noncontrolling interests | (62,693) | 62,693 | |||
Net income | (57,232) | 2,751,711 | |||
Net income (loss) | (2,694,479) | 57,232 | |||
Ending balance (shares) at Sep. 30, 2023 | 24,850,261 | ||||
Ending balance at Sep. 30, 2023 | 16,405,289 | $ 24,850 | 57,525,719 | (41,033,259) | (112,021) |
Beginning balance (shares) at Jun. 30, 2023 | 24,850,261 | ||||
Beginning balance at Jun. 30, 2023 | 16,822,596 | $ 24,850 | 57,456,944 | (40,551,686) | (107,512) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock based compensation expense | 68,775 | 68,775 | |||
Distributions to Noncontrolling interests | (38,855) | (38,855) | |||
Net income | (34,346) | 481,573 | |||
Net income (loss) | (447,227) | 34,346 | |||
Ending balance (shares) at Sep. 30, 2023 | 24,850,261 | ||||
Ending balance at Sep. 30, 2023 | $ 16,405,289 | $ 24,850 | $ 57,525,719 | $ (41,033,259) | $ (112,021) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Consolidated net loss | $ (2,694,479) | $ (967,905) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization, net | 459,779 | 324,968 |
Stock-based compensation | 174,711 | 254,718 |
Provision (release) for doubtful accounts | 44,000 | (183,955) |
Gain on disposition of assets | (19,950) | (41,931) |
Unrealized (gain) loss on investment securities | 18,749 | (37,497) |
Gain on termination of unfavorable contract liability | 0 | (71,375) |
Changes in operating assets and liabilities | ||
Accounts receivable | (1,324,448) | 67,940 |
Employee retention credit receivable | 667,121 | 562,752 |
Unbilled revenue | 56,994 | 1,302,187 |
Inventories | (165,537) | (947,031) |
Prepaid expenses and other current assets | (19,128) | 70,806 |
Other assets | 491,836 | 466,420 |
Increase (decrease) in: | ||
Accounts payable | 1,140,759 | (182,903) |
Accrued expenses and other current liabilities | 256,847 | (80,720) |
Deferred revenue | 458,512 | (487,676) |
Other liabilities | (566,016) | (482,608) |
Net cash used in operating activities | (1,020,250) | (433,810) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (31,728) | (286,820) |
Payment for business acquisition | (170,000) | 0 |
Purchases of intangible assets | 0 | (29,505) |
Proceeds from disposition of assets | 16,863 | 72,655 |
Distributions to non-controlling interest | (62,693) | (56,823) |
Net cash used in investing activities | (247,558) | (300,493) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net cash provided by financing activities | 0 | 0 |
Change in cash and cash equivalents | (1,267,808) | (734,303) |
Cash and cash equivalents, beginning of the period | 1,913,969 | 3,614,463 |
Cash and cash equivalents, end of the period | 646,161 | 2,880,160 |
Non-cash investing and financing activities: | ||
Cash paid for interest | 7,385 | 14,597 |
Cash paid for taxes | 32,252 | 16,352 |
Accounts receivable credit | 300,000 | 0 |
Accounts payable assumed | 91,048 | 0 |
Contingent consideration | 1,442,462 | 0 |
Total fair value of non-cash consideration | $ 1,833,510 | $ 0 |
Description of business and bas
Description of business and basis of presentation | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Description of business and basis of presentation | Description of Business and Basis of Presentation Description of Business Tecogen Inc. (together with its subsidiaries, “we,” “our,” or “us,” or “Tecogen”) designs, manufactures, markets, and maintains high efficiency, ultra-clean cogeneration products. These include natural gas engine driven combined heat and power (CHP) systems, chillers and heat pumps for multi-family residential, commercial, recreational and industrial use. We are known for products that provide customers with substantial energy savings, resiliency from utility power outages and for significantly reducing a customer’s carbon footprint. Our products are sold with our patented Ultera® emissions technology which nearly eliminates all criteria pollutants such as nitrogen oxide ("NOx") and carbon monoxide ("CO"). We developed Ultera® for other applications including stationary engines and forklifts. We were incorporated in the State of Delaware on September 15, 2000. We have wholly-owned subsidiaries American DG Energy, Inc. ("ADGE") and Tecogen CHP Solutions, Inc., and we own a 51% interest in American DG New York, LLC ("ADGNY"), a joint venture. ADGE and ADGNY distribute, own, and operate clean, on-site energy systems that produce electricity, hot water, heat and cooling. ADGE and ADGNY own the equipment that is installed at customers' facilities and sell the energy produced to the customer on a long-term contractual basis. Our operations are comprised of three business segments: • our Products segment, which designs, manufactures and sells industrial and commercial cogeneration systems; • our Services segment, which provides operations and maintenance ("O&M") services for our products under long term service contracts, and • our Energy Production segment, which installs, operates and maintains distributed generation electricity systems that we own and sells energy generated by such systems in the form of electricity, heat, hot water and cooling to our customers under long-term energy sales agreements. The majority of our customers are located in regions with the highest utility rates, typically California, the Midwest and the Northeast. On July 20, 2022, we announced our intention to increase focus on opportunities relating to Controlled Environment Agriculture (CEA). Tecogen believes that CEA offers an exciting opportunity to apply the company’s expertise in clean cooling, power generation, and greenhouse gas reduction to address critical issues affecting food and energy security. However, we have not taken any formal steps to enter this business as of the date of the filing of this report. Our common stock is quoted on OTC Markets Group, Inc.'s OTCQX Best Market tier and trades under the symbol "TGEN." On May 18, 2017, we acquired 100% of the outstanding common stock of American DG Energy Inc., formerly a related entity, in a stock-for-stock merger. On March 15, 2023, we entered into an agreement ("Agreement") with Aegis Energy Services, LLC (“Aegis”) pursuant to which Aegis agreed to assign to us and we agreed to assume certain Aegis maintenance agreements, we agreed to purchase certain assets, and related matters (“Acquisition”). On April 1, 2023, the Acquisition closed. Under the Agreement, we agreed to acquire from Aegis and assume Aegis rights and obligations arising on or after April 1, 2023, under maintenance agreements pursuant to which Aegis provided maintenance services for approximately 200 cogeneration systems, and acquired certain vehicles and inventory used by Aegis in connection with the performance of such maintenance services, and, following closing hired eight (8) Aegis employees to provide services with respect to such maintenance agreements. At closing, we acquired eight (8) Aegis vehicles for consideration consisting of $170,000 in cash. Also, we issued credits against outstanding accounts receivable due from Aegis in the amount of $300,000 for the acquisition of inventory that Aegis used to provide maintenance services. See Note 8. - Aegis Contract and Related Asset Acquisition. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. The condensed consolidated balance sheet at December 31, 2022 has been derived from the audited consolidated financial statements at that date included in our annual report of Form 10-K for the year ended December 31, 2022 ("2022 Form 10-K"), but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Tecogen's Annual Report on Form 10-K for the year ended December 31, 2022. The accompanying unaudited condensed consolidated financial statements include our accounts and the accounts of entities in which we have a controlling financial interest. Those entities include our wholly-owned subsidiaries American DG Energy Inc., Tecogen CHP Solutions, Inc., and a joint venture, American DG New York, LLC, in which American DG Energy Inc. holds a 51% interest. Investments in partnerships and companies in which we do not have a controlling financial interest but where we have significant influence are accounted for under the equity method. Any intercompany transactions have been eliminated in consolidation. Our operations are comprised of three business segments. Our Products segment designs, manufactures and sells industrial and commercial cogeneration systems as described above. Our Services segment provides operation and maintenance services to customers for our products. Our Energy Production segment installs, operates and maintains distributed generation electricity systems that we own and sells energy generated by such systems in the form of electricity, heat, hot water and cooling to our customers under long-term sales agreements. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Liquidity At September 30, 2023, we had cash and cash equivalents of $646,161, a decrease of $1,267,808 or 66.2% from the cash and cash equivalents balance at December 31, 2022. During the nine months ended September 30, 2023, our Products revenue was negatively impacted. Our Products have long sales cycles and the reduced business development activity in the aftermath of COVID-19 resulted in what we believe is a temporary reduction in Products revenue. Based on our current operating plan, we believe existing resources, including existing cash, cash flows from operations and the funds available to us under loans from certain related parties will be sufficient to meet our working capital requirements for the next twelve months. However, we may need to generate sufficient additional cash from operations to finance the company during the periods beyond twelve months. On October 9, 2023, we entered into an agreement with each of John N. Hatsopoulos, a director and principal shareholder of registrant, and Earl R. Lewis, III, a director, pursuant to which Mr. Hatsopoulos agreed to provide financing to us of up to $1 million, and Mr. Lewis agreed to provide financing to us of $500,000, and potentially an additional $500,000 at his discretion. On October 10, 2023, we issued a promissory note and borrowed $500,000 from Mr. Hatsopoulos. The loan bears interest at 5.12% per annum and is repayable one year from the date of the issuance of the related promissory note. The proceeds of the loans are expected to be used for general working capital purposes. If sufficient funds from operating activities are not available to finance our business and operations, we may need to raise additional capital through debt financing or an equity offering to meet our operating and capital needs. There can be no assurance we will be able to raise such additional debt or equity financing or upon terms that are acceptable to us. Income Taxes The provisions for income taxes in the accompanying unaudited consolidated statements of operations differ from that which would be expected by applying the federal statutory tax rate primarily due to losses for which no benefit is recognized. Employee Retention Credit On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law providing numerous tax provisions and other stimulus measures, including an employee retention credit (“ERC”), which is a refundable tax credit against certain employment taxes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021 extended and expanded the availability of the ERC. As a result of our election to use an alternative quarter, we qualified for the ERC in the first, second and third quarters of 2021 because our gross receipts decreased by more than 20% from the first, second and third quarters of 2019. As a result of averaging 100 or fewer full-time employees in 2019, all wages paid to employees in the first, second and third quarters of 2021, excluding the wages applied to the Paycheck Protection Program Second Draw Loan, were eligible for the ERC. |
Income (Loss) Per Common Share
Income (Loss) Per Common Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Income (Loss) Per Common Share | Income Per Common Share Basic and diluted loss per share for the three and nine months ended September 30, 2023 and 2022, respectively, were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net loss available to stockholders $ (481,573) $ (256,712) $ (2,751,711) $ (1,023,521) Denominator: Weighted average shares outstanding - Basic 24,850,261 24,850,261 24,850,261 24,850,261 Effect of dilutive securities: Stock options — — — — Weighted average shares outstanding - Diluted 24,850,261 24,850,261 24,850,261 24,850,261 Basic loss per share $ (0.02) $ (0.01) $ (0.11) $ (0.04) Diluted loss per share $ (0.02) $ (0.01) $ (0.11) $ (0.04) Anti-dilutive shares underlying stock options outstanding 1,829,051 971,001 1,829,051 836,001 |
Inventories, net
Inventories, net | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories, net | Inventories, net Inventories at September 30, 2023 and December 31, 2022 consisted of the following: September 30, 2023 December 31, 2022 Raw materials, net $ 9,545,184 $ 9,001,491 Work-in-process 706,731 498,139 Finished goods 787,398 983,099 Total inventories, net $ 11,039,313 $ 10,482,729 |
Property, Plant and Equipment,
Property, Plant and Equipment, net | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | Property, Plant and Equipment, net Property, plant and equipment at September 30, 2023 and December 31, 2022 consisted of the following: Estimated Useful September 30, 2023 December 31, 2022 Energy systems 1 - 15 years $ 2,810,232 $ 2,810,232 Machinery and equipment 5 - 7 years 1,758,601 1,624,885 Furniture and fixtures 5 years 206,865 196,007 Computer software 3 - 5 years 192,865 192,865 Leasehold improvements * 466,789 466,789 5,435,352 5,290,778 Less - accumulated depreciation and amortization (4,180,696) (3,883,058) $ 1,254,656 $ 1,407,720 * Lesser of estimated useful life of asset or lease term |
Intangible Assets and Liabiliti
Intangible Assets and Liabilities Other Than Goodwill | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Liabilities Other Than Goodwill | Intangible Assets and Liabilities Other Than Goodwill As of September 30, 2023 and December 31, 2022 we had the following amounts related to intangible assets and liabilities other than goodwill: September 30, 2023 December 31, 2022 Intangible assets Cost Accumulated Amortization Total Cost Accumulated Amortization Total Product certifications $ 777,465 $ (639,073) $ 138,392 $ 777,465 $ (584,863) $ 192,602 Patents 888,910 (474,882) 414,028 888,910 (405,140) 483,770 Developed technology 240,000 (168,000) 72,000 240,000 (156,000) 84,000 Trademarks 26,896 — 26,896 26,896 — 26,896 In Process R&D 263,936 (94,263) 169,673 263,936 (65,984) 197,952 Favorable contract asset 384,465 (375,213) 9,252 384,465 (372,091) 12,374 Customer contract 1,591,327 (113,666) 1,477,661 — — — $ 4,172,999 $ (1,865,097) $ 2,307,902 $ 2,581,672 $ (1,584,078) $ 997,594 Intangible liability Unfavorable contract liability $ 2,618,168 $ (1,968,383) $ 649,785 $ 2,618,168 $ (1,797,951) $ 820,217 The aggregate amortization expense related to intangible assets and liabilities exclusive of unfavorable contract related intangibles for the three and nine months ended September 30, 2023 and 2022 was $113,477 and $280,671 and $49,885 and $150,376, respectively. The net credit to cost of sales related to the amortization of the unfavorable contract related intangible asset and liability for the three and nine months ended September 30, 2023 and 2022 was $54,576 and $170,084 and $69,370 and $202,753, respectively. Favorable/Unfavorable Contract Assets and Liabilities and Customer Contract Assets The favorable contract asset and unfavorable contract liability in the foregoing table represent the estimated fair value of American DG Energy's customer contracts (both positive for favorable contracts and negative for unfavorable contracts) which were acquired by us in May 2017 and include the customer relationship contract acquired by us in April 2023 as part of the Aegis acquisition. The American DG Energy's favorable and unfavorable contract contracts are being amortized on a straight-line basis over the contract term, which varies by customer contract. The Aegis customer relationship contract is being amortized on a straight-line basis over a period of seven (7) years which is consistent with the projected revenue recognition. Amortization of intangibles including contract related amounts is calculated using the straight-line method over the remaining useful life or contract term. Aggregate future amortization over the next five years and thereafter as of September 30, 2023 is estimated to be as follows: Non-contract Related Intangibles Contract Related Intangibles Total Year 1 $ 172,412 $ 26,242 $ 198,654 Year 2 178,779 111,624 290,403 Year 3 174,763 153,964 328,727 Year 4 172,340 167,176 339,516 Year 5 63,940 175,750 239,690 Thereafter 41,111 193,120 234,231 Total $ 803,345 827,876 $ 1,631,221 We recognized a gain on termination of unfavorable contract liability of $71,375 in the nine months ended September 30, 2022 due to the closing of certain energy production sites. |
Aegis Contract and Related Asse
Aegis Contract and Related Asset Acquisition | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Aegis Contract and Related Asset Acquisition | Aegis Contract and Related Asset AcquisitionOn March 15, 2023, we entered into an agreement ("Agreement") with Aegis Energy Services, LLC (“Aegis”) pursuant to which Aegis agreed to assign to us and we agreed to assume certain Aegis maintenance agreements, we agreed to purchase certain assets from Aegis, and related matters (“Acquisition”). On April 1, 2023, the Acquisition closed. Under the Agreement, we agreed to acquire from Aegis and assume Aegis’ rights and obligations arising on or after April 1, 2023, under maintenance agreements pursuant to which Aegis provided maintenance services to third parties for approximately 200 cogeneration systems and we agreed to acquire from Aegis certain vehicles and inventory used by Aegis in connection with the performance of its maintenance services. At closing, we acquired eight (8) Aegis vehicles for consideration consisting of $170,000 in cash. Also, we issued credits against outstanding accounts receivable due from Aegis in the amount of $300,000 for the acquisition of inventory that Aegis used to provide maintenance services. At closing, we hired eight (8) Aegis employees who, following the closing, have agreed to continue to provide maintenance services relating to the cogeneration systems covered by the maintenance agreements assumed pursuant to the Agreement. Following the closing and for a period of up to seven (7) years, we agreed to pay Aegis a percentage of the revenue collected for maintenance services provided pursuant to the maintenance agreements acquired from Aegis. Further, prior to December 31, 2023, we have the right to acquire and assume additional Aegis’ maintenance agreements for cogeneration systems on substantially similar terms and conditions. As of September 30, 2023, we have not acquired or assumed any additional maintenance agreements from Aegis. The Agreement contained certain indemnification provisions and agreements on the part of Aegis and for each party to cooperate with each other and provide certain transitional assistance. We acquired the Aegis maintenance agreements to expand our Service portfolio and to benefit from the long-term contract revenue stream generated by these agreements. We have determined that the assignment and assumption of the Aegis maintenance agreements, in combination with the related asset acquisition and the retention of the former Aegis employees, constitutes a business and should be accounted for as a business combination under the acquisition method. As of the acquisition date, we recognized, separately from goodwill, the identifiable assets acquired and the liabilities assumed, at fair value. We have included the financial results of the Aegis maintenance agreements in our consolidated financial statements from April 1, 2023, the closing or acquisition date. The following table summarizes the consideration paid for the Aegis acquisition and the fair value of assets acquired and contract-related liabilities assumed as the acquisition date: Consideration Paid: Cash $ 170,000 Accounts receivable credit issued 300,000 Account payable 91,048 Contingent consideration 1,442,462 Total fair value of consideration transferred 2,003,510 Identifiable assets acquired and liabilities assumed: Assets acquired Property, plant and equipment 170,000 Inventory 391,048 Identifiable intangible asset - customer contracts 1,591,327 2,152,375 Acquired contract-related liabilities assumed Deferred maintenance reserve (871,856) (871,856) Net identifiable assets acquired 1,280,519 Excess of cost over fair value of net assets acquired (Goodwill) $ 722,991 The amounts recognized for inventory, identifiable intangible assets, contingent consideration and deferred maintenance reserves are provisional pending completion of the necessary valuations and analysis. ASC 805 establishes a measurement period to provide companies with a reasonable amount of time to obtain the information necessary to identify and measure various items in a business combination and cannot extend beyond one year from the acquisition date. During the three months ended September 30, 2023, we identified a $20,130 adjustment to decrease the accounts payable assumed and inventory acquired which had no impact on goodwill balance. The fair value of the contingent consideration was estimated using the income approach. The excess cash flow was discounted to present value using an appropriate rate of return to estimate the market value of the customer identifiable intangible asset and the risks associated with the future revenue forecasts due to potential changes in customer energy requirements or changes in the economic viability of these CHP sites which depend on the spread between natural gas fuel and electricity prices, all of which are not within our control. Key assumptions to value the customer identifiable intangible asset included a discount rate of 15%, anticipated existing contract run out and forecasted revenue. On the date of acquisition, the fair value of the contingent consideration and the deferred maintenance reserve were calculated using a weighted average cost of capital of 12%, discounting the future cash flows to present value and are subsequently remeasured to fair value at each reporting date until the fair value contingencies are resolved. Fair value adjustments which may be determined at subsequent reporting dates will be recorded in our consolidated statements of operations and will not impact the goodwill balance. As of September 30, 2023, we did not remeasure the contingent consideration and deferred maintenance reserves given the probability of achieving the revenue estimates and deferred maintenance costs were consistent with our initial valuation. The contingent consideration is payable within forty-five (45) days following the end of each calendar quarter through the earlier of the expiration or termination of the relevant maintenance agreements, or the seventh (7th) anniversary of the acquisition date. The consideration is equal to the product of the revenues collected in a calendar quarter multiplied by an applicable percentage. The agreement stipulates quarterly aggregate revenue targets and an applicable percentage, and provides for a higher applicable percentage if revenues exceed the target revenues. The applicable percentage ranges from 5% to 10% over the agreement term. The deferred maintenance reserve represents costs, which are expected to be incurred over a three-year period from the date of acquisition, to repair customer equipment that had not been properly maintained prior to our acquisition of the maintenance service agreements. Revenues and gross profit from the Aegis maintenance contracts since the acquisition date were $1,231,537 and $766,804, respectively, for the nine months ended September 30, 2023 and are included in our Services segment. The purchase price of the acquisition was allocated to the tangible and intangible assets acquired and liabilities assumed and recognized at their fair value based on widely accepted valuation techniques in accordance with ASC 820, "Fair Value Measurement," as of the acquisition date. The process for estimating fair value requires the use of significant assumptions and estimates of future cash flows and developing appropriate discount rates. The excess of the purchase price over fair value of the net identified assets acquired and liabilities assumed was recorded as goodwill. Goodwill is primarily attributable to the going concern element of the Aegis business, including its assembled workforce and the long-term nature of the customer maintenance agreements, as well as anticipated cost synergies due primarily to the elimination of administrative overhead. Goodwill resulting from the Aegis acquisition is not expected to be deductible for income tax purposes. Acquisition-related costs which consisted on recurring internal resources were de minimus and such costs were expensed as incurred (ASC 805-50-30-1). The following table summarizes the contract-related liabilities assumed as of September 30, 2023: September 30, 2023 Acquisition liabilities, current Contingent consideration $ 205,246 Deferred maintenance reserve 570,745 775,991 Acquisition liabilities, long-term Contingent consideration 1,206,077 Deferred maintenance reserve 279,600 $ 1,485,677 |
Sale of Energy Producing Assets
Sale of Energy Producing Assets and Goodwill Impairment | 9 Months Ended |
Sep. 30, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Sale of Energy Producing Assets and Goodwill Impairment | Sale of Energy Producing Assets and Goodwill ImpairmentDuring the first quarter of 2019 we recognized two individual sales of energy producing assets, for a total of eight power purchase agreements, including the associated energy production contracts for total consideration of $7 million. In connection with these assets sales, we entered into agreements with the purchaser to maintain and operate the assets over the remaining periods of the associated energy production contracts (through August 2033 and January 2034, respectively) in exchange for monthly maintenance and operating fees. These agreements contain provisions whereby we have guaranteed to the purchaser a minimum level or threshold of cash flows from the associated energy production contracts. In October 2021 the minimum guarantee with respect to one of the energy purchase agreements was modified by reducing the guaranteed minimum collections by $35,000 per year, the guaranteed minimum collection amount associated with one site that was sold by the customer. Actual results are compared to the minimum threshold bi-annually and we are contractually obligated to reimburse any shortfall to the purchaser. To the extent actual cash flow results exceed the minimum threshold, we are entitled to fifty percent of such excess under the agreements. Based upon an analysis of these energy producing assets expected future performance, as of September 30, 2023, we do not expect to make any material payments under the guarantee. At September 30, 2023, there were no amounts due under the energy production contracts. The foregoing agreements also contain provisions whereby we have agreed to make whole the purchaser in the event the counterparty to the energy production contract(s) defaults on or otherwise terminates before the stated expiration of the energy production contract. If we are required to make whole the purchaser under such provisions, we expect to be able to recover from the counterparty to the energy production contract(s) under a similar provision contained in those contracts in respect of early termination. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases Our leases principally consist of operating leases related to our corporate office, field offices, and our research, manufacturing, and storage facilities. At inception, we determine if an arrangement constitutes a lease and whether that lease meets the classification criteria of a finance or operating lease. Some of our lease agreements contain lease components (e.g. minimum rent payments) and non-lease components (e.g. maintenance, labor charges, etc.). We account for each component separately based on the estimated standalone price of each component. Operating leases are included in Right-of-use assets, Lease obligations, current and Long-term liabilities - Lease obligations, net of current portion, on the condensed consolidated balance sheets. These assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term and using an incremental borrowing rate consistent with the lease terms or implicit rates, when readily determinable. For those leases where it is reasonably certain at the commencement date that we will exercise the option to extend the lease, then the lease term will include the lease extension term. Short-term operating leases, which have an initial term of 12 months or less, are not recorded on the balance sheet. Lease expense for operating leases, which principally consist of fixed payments for base rent, is recognized on a straight-line basis over the lease term. Lease expense for the three and nine months ended September 30, 2023 and 2022 was $209,506 and $616,062 and $201,578 and $608,652, respectively. Supplemental information related to leases for the nine months ended September 30, 2023 and 2022 is as follows: Nine Months Ended September 30, 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities $ 558,028 $ 549,402 Right-of-use assets obtained in exchange for operating lease liabilities $ — $ — Weighted-average remaining lease term - operating leases 3.90 years 3.60 years Weighted-average discount rate - operating leases 6 % 6 % Supplemental information related to operating leases as of September 30, 2023 and December 31, 2022 is as follows: September 30, 2023 December 31, 2022 Operating leases Right-of-use assets $ 754,957 $ 1,245,549 Operating lease liability, current $ 367,938 $ 687,589 Operating lease liability, long-term 429,737 623,452 Total operating lease liability $ 797,675 $ 1,311,041 Future minimum lease commitments under non-cancellable operating leases as of September 30, 2023 were as follows: Operating Leases Year 1 $ 398,741 Year 2 127,092 Year 3 119,902 Year 4 61,044 Year 5 53,752 Thereafter 130,553 Total lease payments 891,084 Less: imputed interest 93,409 Total $ 797,675 The lease for our headquarters located in Waltham, Massachusetts which consists of approximately 43,000 square feet of manufacturing, storage and office space, expires on March 31, 2024. Currently, our monthly base rent is $44,254. On March 31, 2023, we entered into two lease agreements for two adjoining buildings, located in Billerica, Massachusetts, containing approximately 26,412 square feet of manufacturing, storage and office space to serve as our headquarters and manufacturing facilities. The lease agreements provide for initial lease terms of five (5) years with two successive options to renew for additional terms of five (5) years. Both leases commence on January 1, 2024 and require payment of the base rent, real estate taxes, common maintenance expenses and aggregate deposits of $38,200. Our costs for initial improvements required to the leased premises is estimated to range between $1,000,000 and $1,250,000. The estimated straight-line monthly rent expense for the initial term of the lease is approximately $24,800 per month. In accordance with ASC 842-20-30-1, we will record the lease liability and right-of-use asset using the discount rate for the lease upon the lease commencement date. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-Based Compensation We adopted a 2006 Stock Option and Incentive Plan, or the Plan, under which the Board of Directors may grant incentive or non-qualified stock options and stock grants to employees, directors, advisors and consultants. The Plan was amended at various dates by the Board of Directors to increase number of shares of common stock authorized to be issued under the Plan to 3,838,750 as of September 30, 2023, and in June 2017 stockholders approved an amendment to extend the termination date of the Plan to January 1, 2026 and ratified and approved option grants issued after January 1, 2016 ("Amended Plan"). Stock options vest based upon the terms within the individual option grants, with an acceleration of the unvested portion of such options upon a change in control event, as defined in the Amended Plan. The options are not transferable except by will or by the laws of descent and distribution. The option price per share under the Amended Plan cannot be less than the fair market value of the underlying shares on the date of the grant. The number of shares remaining available for future issuance under the Amended Plan as of September 30, 2023 was 191,193. During the nine months ended September 30, 2023, we did not grant any options to purchase shares of common stock under the Amended Plan. We adopted the 2022 Stock Incentive Plan (the "2022 Plan"), under which the Board of Directors may grant incentive or non-qualified stock options and stock grants to employees, directors, advisors and consultants. Under the 2022 Plan, 3,800,000 shares of our shares of our common stock are authorized for issuance pursuant to awards under the 2022 Plan. The adoption of the 2022 Plan was approved by our shareholders on June 9, 2022. Under the 2022 Plan, stock options vest based upon the terms within the individual option grants, with an acceleration of the unvested portion of such options upon a change in control event, as defined in the 2022 Plan. The options are not transferable except by will or domestic relations order. The option price per share under the 2022 Plan cannot be less than the fair market value of the underlying shares on the date of the grant. The number of shares remaining available for future issuance under the Plan as of September 30, 2023 was 3,025,000. During the nine months ended September 30, 2023, we granted non-qualified options to purchase an aggregate of 575,000 shares of our common stock at exercise prices ranging between $0.88 - $1.10 per share to certain directors, officers and employees. These options have a vesting schedules of two or four years and expire in ten years. The fair value of the options issued in 2023 was $244,625. The weighted-average grant date fair value of stock options granted during 2023 was $0.43 per share. Stock option activity for the nine months ended September 30, 2023 was as follows: Common Stock Options Number of Exercise Weighted Weighted Aggregate Outstanding, December 31, 2022 3,204,297 $ 0.71 $ 10.33 $ 1.61 7.30 years $ 882,074 Granted 575,000 $ 0.88 $ 1.10 $ 0.93 Exercised — Canceled and forfeited (44,800) $ 2.86 Outstanding, September 30, 2023 3,734,497 $ 1.10 $ 3.20 $ 1.49 7.14 years $ 188,529 Exercisable, September 30, 2023 1,931,322 $ 1.97 $ 112,578 Vested and expected to vest, September 30, 2023 3,462,521 $ 0.71 $ 10.33 $ 1.53 $ 177,136 Consolidated stock-based compensation expense for the three and nine months ended September 30, 2023 and 2022 was $68,775 and $174,711 and $69,118 and $254,718, respectively. No tax benefit was recognized related to the stock-based compensation recorded during the period. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The fair value topic of the FASB Accounting Standards Codification defines fair value 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. The accounting guidance also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities. We currently do not have any Level 1 financial assets or liabilities. Level 2 - Observable inputs other than quoted prices included in Level 1. Level 2 inputs include quoted prices for identical assets or liabilities in non-active markets, quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for substantially the full term of the asset or liability. We have Level 2 financial assets and liabilities as provided below. Level 3 - Unobservable inputs reflecting management’s own assumptions about the input used in pricing the asset or liability. We do not currently have any Level 3 financial assets or liabilities. The following tables present the asset reported in "other assets" in the consolidated balance sheet measured at its fair value on a recurring basis as of September 30, 2023 and 2022 by level within the fair value hierarchy. September 30, 2023 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Unrealized Description Total Level 1 Level 2 Level 3 Gains /(Losses) Recurring fair value measurements Marketable equity securities EuroSite Power Inc. $ 74,995 $ — $ 74,995 $ — $ (18,749) Total recurring fair value measurements $ 74,995 $ — $ 74,995 $ — $ (18,749) September 30, 2022 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Unrealized Description Total Level 1 Level 2 Level 3 Gains /(Losses) Recurring fair value measurements Marketable equity securities EuroSite Power Inc. $ 112,492 $ — $ 112,492 $ — $ 37,497 Total recurring fair value measurements $ 112,492 $ — $ 112,492 $ — $ 37,497 We utilize a Level 2 category fair value measurement to value our investment in EuroSite Power, Inc. as a marketable equity security at period end. That measurement is equal to the quoted market closing price at period end. Since this security is not actively traded we classify it as Level 2. The following table summarizes changes in Level 2 assets which are comprised of marketable equity securities for the nine months ended September 30, 2023 and 2022: Fair value at December 31, 2022 $ 93,744 Unrealized losses (18,749) Fair value at September 30, 2023 $ 74,995 Fair value at December 31, 2021 $ 74,995 Unrealized gains 37,497 Fair value at September 30, 2022 $ 112,492 |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and Contingencies On November 23, 2022, we were served with a suit filed against us on August 24, 2022 in the Ontario Superior Court of Justice by The Corporation of the Town of Milton, Milton Energy Generation Solutions Inc. and Milton Hydro Distribution Inc (the "Plaintiffs"), all of whom are municipal corporations incorporated in the Province of Ontario. The plaintiffs sued for damages in the amount of CDN $1,000,000, pre-judgment and post-judgment interest, legal fees, and any further relief the court |
Segments
Segments | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segments | Segments As of September 30, 2023, we were organized into three (3) operating segments through which senior management evaluates our business. These segments, as described in more detail in Note 1, are organized around the products and services provided to customers and represent our reportable segments. The following table presents information by reportable segment for the three and nine months ended September 30, 2023 and 2022: Products Services Energy Production Corporate, other and elimination (1) Total Three Months Ended September 30, 2023 Revenue - external customers $ 2,938,789 $ 3,842,600 $ 331,141 $ — $ 7,112,530 Intersegment revenue — 48,085 — (48,085) — Total revenue $ 2,938,789 $ 3,890,685 $ 331,141 $ (48,085) $ 7,112,530 Gross profit $ 1,269,042 $ 1,496,216 $ 160,763 $ — $ 2,926,021 Identifiable assets $ 10,591,087 $ 13,270,545 $ 3,203,776 $ 2,121,337 $ 29,186,745 Nine Months Ended September 30, 2023 Revenue - external customers $ 7,094,556 $ 10,931,744 $ 1,214,806 $ — $ 19,241,106 Intersegment revenue — 202,442 — (202,442) — Total revenue $ 7,094,556 $ 11,134,186 $ 1,214,806 $ (202,442) $ 19,241,106 Gross profit $ 2,593,785 $ 4,771,889 $ 486,682 $ — $ 7,852,356 Identifiable assets $ 10,591,087 $ 13,270,545 $ 3,203,776 $ 2,121,337 $ 29,186,745 Three Months Ended September 30, 2022 Revenue - external customers $ 3,206,732 $ 3,078,604 $ 332,774 $ — $ 6,618,110 Intersegment revenue — 41,390 — (41,390) — Total revenue $ 3,206,732 $ 3,119,994 $ 332,774 $ (41,390) $ 6,618,110 Gross profit $ 1,132,489 $ 1,596,249 $ 164,596 $ — $ 2,893,334 Identifiable assets $ 10,639,810 $ 10,308,988 $ 3,754,321 $ 5,368,204 $ 30,071,323 Nine Months Ended September 30, 2022 Revenue - external customers $ 10,156,328 $ 9,046,075 $ 1,268,623 $ — $ 20,471,026 Intersegment revenue — 199,059 — (199,059) — Total revenue $ 10,156,328 $ 9,245,134 $ 1,268,623 $ (199,059) $ 20,471,026 Gross profit $ 3,421,863 $ 4,723,382 $ 542,326 $ — $ 8,687,571 Identifiable assets $ 10,639,810 $ 10,308,988 $ 3,754,321 $ 5,368,204 $ 30,071,323 (1) Corporate, intersegment revenue, other and elimination includes various corporate assets. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events We have evaluated events through the date of the filing of this report and, except as described below, have determined that no material subsequent events occurred that would require disclosure in the unaudited consolidated financial statements for the period ended September 30, 2023 or in the financial notes thereto. Related Party Loans On October 9, 2023, we entered into an agreement with each of John N. Hatsopoulos, a director and principal shareholder of registrant, and Earl R. Lewis, III, a director of registrant, pursuant to which Mr. Hatsopoulos agreed to provide financing to us of up to $1 million, and Mr. Lewis agreed to provide financing to us of $500,000, and potentially, an additional $500,000 at his discretion. We have the right to determine the amount of the loans at the time of a draw down, subject to the conditions in our agreements with each of Mr. Hatsopoulos and Mr. Lewis discussed below. The loans and terms of the loan agreements were unanimously approved by our board of directors. The loans bear interest on the outstanding principal at the Internal Revenue Service’s Applicable Federal Rate to be determined at the time we issue a promissory note in connection with a loan drawdown. The principal amount and accrued interest of each loan is repayable one year from the date of issuance of the applicable promissory note. A note may be prepaid by us at any time. The principal amount of each loan and accrued interest is subject to mandatory prepayment in the event of a change of control of the registrant. The promissory notes are subject to customary events of default and are transferable provided the conditions to transfer set forth in the promissory notes are satisfied by the noteholder. The proceeds of the loans are expected to be used for general working capital purposes. On October 10, 2023, we issued a promissory note and borrowed $500,000 from Mr. Hatsopoulos. The loan bears interest at 5.12% per annum. Proposed Reverse Stock Split On October 9, 2023, our board of directors authorized us to seek shareholder approval at a special meeting of our shareholders of an amendment to our Amended and Restated Certificate of Incorporation (“certificate of incorporation”) that would enable us to effect a combination of our outstanding shares of common stock into a lesser number of shares, or a reverse stock split. We intend to seek stockholder approval for three alternative amendments to our certificate of incorporation and to effect the reverse stock split at the alternative ratios of 1 for 4, 1 for 5, or 1 for 6. The determination of the ratio, implementation, and timing of any reverse stock split will be subject to further approval by our board of directors following receipt of shareholder approval at a special meeting of our shareholders. |
Description of business and b_2
Description of business and basis of presentation (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. The condensed consolidated balance sheet at December 31, 2022 has been derived from the audited consolidated financial statements at that date included in our annual report of Form 10-K for the year ended December 31, 2022 ("2022 Form 10-K"), but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Tecogen's Annual Report on Form 10-K for the year ended December 31, 2022. The accompanying unaudited condensed consolidated financial statements include our accounts and the accounts of entities in which we have a controlling financial interest. Those entities include our wholly-owned subsidiaries American DG Energy Inc., Tecogen CHP Solutions, Inc., and a joint venture, American DG New York, LLC, in which American DG Energy Inc. holds a 51% interest. Investments in partnerships and companies in which we do not have a controlling financial interest but where we have significant influence are accounted for under the equity method. Any intercompany transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates |
Income Taxes | Income Taxes The provisions for income taxes in the accompanying unaudited consolidated statements of operations differ from that which would be expected by applying the federal statutory tax rate primarily due to losses for which no benefit is recognized. |
Loss Per Common Share (Tables)
Loss Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Income (Loss) Per Common Share, Basic and Diluted | Basic and diluted loss per share for the three and nine months ended September 30, 2023 and 2022, respectively, were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net loss available to stockholders $ (481,573) $ (256,712) $ (2,751,711) $ (1,023,521) Denominator: Weighted average shares outstanding - Basic 24,850,261 24,850,261 24,850,261 24,850,261 Effect of dilutive securities: Stock options — — — — Weighted average shares outstanding - Diluted 24,850,261 24,850,261 24,850,261 24,850,261 Basic loss per share $ (0.02) $ (0.01) $ (0.11) $ (0.04) Diluted loss per share $ (0.02) $ (0.01) $ (0.11) $ (0.04) Anti-dilutive shares underlying stock options outstanding 1,829,051 971,001 1,829,051 836,001 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories at September 30, 2023 and December 31, 2022 consisted of the following: September 30, 2023 December 31, 2022 Raw materials, net $ 9,545,184 $ 9,001,491 Work-in-process 706,731 498,139 Finished goods 787,398 983,099 Total inventories, net $ 11,039,313 $ 10,482,729 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | Property, plant and equipment at September 30, 2023 and December 31, 2022 consisted of the following: Estimated Useful September 30, 2023 December 31, 2022 Energy systems 1 - 15 years $ 2,810,232 $ 2,810,232 Machinery and equipment 5 - 7 years 1,758,601 1,624,885 Furniture and fixtures 5 years 206,865 196,007 Computer software 3 - 5 years 192,865 192,865 Leasehold improvements * 466,789 466,789 5,435,352 5,290,778 Less - accumulated depreciation and amortization (4,180,696) (3,883,058) $ 1,254,656 $ 1,407,720 * Lesser of estimated useful life of asset or lease term |
Intangible Assets and Liabili_2
Intangible Assets and Liabilities Other Than Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | As of September 30, 2023 and December 31, 2022 we had the following amounts related to intangible assets and liabilities other than goodwill: September 30, 2023 December 31, 2022 Intangible assets Cost Accumulated Amortization Total Cost Accumulated Amortization Total Product certifications $ 777,465 $ (639,073) $ 138,392 $ 777,465 $ (584,863) $ 192,602 Patents 888,910 (474,882) 414,028 888,910 (405,140) 483,770 Developed technology 240,000 (168,000) 72,000 240,000 (156,000) 84,000 Trademarks 26,896 — 26,896 26,896 — 26,896 In Process R&D 263,936 (94,263) 169,673 263,936 (65,984) 197,952 Favorable contract asset 384,465 (375,213) 9,252 384,465 (372,091) 12,374 Customer contract 1,591,327 (113,666) 1,477,661 — — — $ 4,172,999 $ (1,865,097) $ 2,307,902 $ 2,581,672 $ (1,584,078) $ 997,594 Intangible liability Unfavorable contract liability $ 2,618,168 $ (1,968,383) $ 649,785 $ 2,618,168 $ (1,797,951) $ 820,217 |
Schedule of Future Amortization Expense | Aggregate future amortization over the next five years and thereafter as of September 30, 2023 is estimated to be as follows: Non-contract Related Intangibles Contract Related Intangibles Total Year 1 $ 172,412 $ 26,242 $ 198,654 Year 2 178,779 111,624 290,403 Year 3 174,763 153,964 328,727 Year 4 172,340 167,176 339,516 Year 5 63,940 175,750 239,690 Thereafter 41,111 193,120 234,231 Total $ 803,345 827,876 $ 1,631,221 |
Aegis Contract and Related As_2
Aegis Contract and Related Asset Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Asset Acquisition | The following table summarizes the consideration paid for the Aegis acquisition and the fair value of assets acquired and contract-related liabilities assumed as the acquisition date: Consideration Paid: Cash $ 170,000 Accounts receivable credit issued 300,000 Account payable 91,048 Contingent consideration 1,442,462 Total fair value of consideration transferred 2,003,510 Identifiable assets acquired and liabilities assumed: Assets acquired Property, plant and equipment 170,000 Inventory 391,048 Identifiable intangible asset - customer contracts 1,591,327 2,152,375 Acquired contract-related liabilities assumed Deferred maintenance reserve (871,856) (871,856) Net identifiable assets acquired 1,280,519 Excess of cost over fair value of net assets acquired (Goodwill) $ 722,991 The following table summarizes the contract-related liabilities assumed as of September 30, 2023: September 30, 2023 Acquisition liabilities, current Contingent consideration $ 205,246 Deferred maintenance reserve 570,745 775,991 Acquisition liabilities, long-term Contingent consideration 1,206,077 Deferred maintenance reserve 279,600 $ 1,485,677 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Supplemental Information Related to Leases | Supplemental information related to leases for the nine months ended September 30, 2023 and 2022 is as follows: Nine Months Ended September 30, 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities $ 558,028 $ 549,402 Right-of-use assets obtained in exchange for operating lease liabilities $ — $ — Weighted-average remaining lease term - operating leases 3.90 years 3.60 years Weighted-average discount rate - operating leases 6 % 6 % |
Future Minimum Lease Commitments | Future minimum lease commitments under non-cancellable operating leases as of September 30, 2023 were as follows: Operating Leases Year 1 $ 398,741 Year 2 127,092 Year 3 119,902 Year 4 61,044 Year 5 53,752 Thereafter 130,553 Total lease payments 891,084 Less: imputed interest 93,409 Total $ 797,675 |
Assets and Liabilities, Lessee | Supplemental information related to operating leases as of September 30, 2023 and December 31, 2022 is as follows: September 30, 2023 December 31, 2022 Operating leases Right-of-use assets $ 754,957 $ 1,245,549 Operating lease liability, current $ 367,938 $ 687,589 Operating lease liability, long-term 429,737 623,452 Total operating lease liability $ 797,675 $ 1,311,041 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Tecogen | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Stock Option Activity | Stock option activity for the nine months ended September 30, 2023 was as follows: Common Stock Options Number of Exercise Weighted Weighted Aggregate Outstanding, December 31, 2022 3,204,297 $ 0.71 $ 10.33 $ 1.61 7.30 years $ 882,074 Granted 575,000 $ 0.88 $ 1.10 $ 0.93 Exercised — Canceled and forfeited (44,800) $ 2.86 Outstanding, September 30, 2023 3,734,497 $ 1.10 $ 3.20 $ 1.49 7.14 years $ 188,529 Exercisable, September 30, 2023 1,931,322 $ 1.97 $ 112,578 Vested and expected to vest, September 30, 2023 3,462,521 $ 0.71 $ 10.33 $ 1.53 $ 177,136 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables present the asset reported in "other assets" in the consolidated balance sheet measured at its fair value on a recurring basis as of September 30, 2023 and 2022 by level within the fair value hierarchy. September 30, 2023 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Unrealized Description Total Level 1 Level 2 Level 3 Gains /(Losses) Recurring fair value measurements Marketable equity securities EuroSite Power Inc. $ 74,995 $ — $ 74,995 $ — $ (18,749) Total recurring fair value measurements $ 74,995 $ — $ 74,995 $ — $ (18,749) September 30, 2022 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Unrealized Description Total Level 1 Level 2 Level 3 Gains /(Losses) Recurring fair value measurements Marketable equity securities EuroSite Power Inc. $ 112,492 $ — $ 112,492 $ — $ 37,497 Total recurring fair value measurements $ 112,492 $ — $ 112,492 $ — $ 37,497 |
Schedule of Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings | The following table summarizes changes in Level 2 assets which are comprised of marketable equity securities for the nine months ended September 30, 2023 and 2022: Fair value at December 31, 2022 $ 93,744 Unrealized losses (18,749) Fair value at September 30, 2023 $ 74,995 Fair value at December 31, 2021 $ 74,995 Unrealized gains 37,497 Fair value at September 30, 2022 $ 112,492 |
Segments (Tables)
Segments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The following table presents information by reportable segment for the three and nine months ended September 30, 2023 and 2022: Products Services Energy Production Corporate, other and elimination (1) Total Three Months Ended September 30, 2023 Revenue - external customers $ 2,938,789 $ 3,842,600 $ 331,141 $ — $ 7,112,530 Intersegment revenue — 48,085 — (48,085) — Total revenue $ 2,938,789 $ 3,890,685 $ 331,141 $ (48,085) $ 7,112,530 Gross profit $ 1,269,042 $ 1,496,216 $ 160,763 $ — $ 2,926,021 Identifiable assets $ 10,591,087 $ 13,270,545 $ 3,203,776 $ 2,121,337 $ 29,186,745 Nine Months Ended September 30, 2023 Revenue - external customers $ 7,094,556 $ 10,931,744 $ 1,214,806 $ — $ 19,241,106 Intersegment revenue — 202,442 — (202,442) — Total revenue $ 7,094,556 $ 11,134,186 $ 1,214,806 $ (202,442) $ 19,241,106 Gross profit $ 2,593,785 $ 4,771,889 $ 486,682 $ — $ 7,852,356 Identifiable assets $ 10,591,087 $ 13,270,545 $ 3,203,776 $ 2,121,337 $ 29,186,745 Three Months Ended September 30, 2022 Revenue - external customers $ 3,206,732 $ 3,078,604 $ 332,774 $ — $ 6,618,110 Intersegment revenue — 41,390 — (41,390) — Total revenue $ 3,206,732 $ 3,119,994 $ 332,774 $ (41,390) $ 6,618,110 Gross profit $ 1,132,489 $ 1,596,249 $ 164,596 $ — $ 2,893,334 Identifiable assets $ 10,639,810 $ 10,308,988 $ 3,754,321 $ 5,368,204 $ 30,071,323 Nine Months Ended September 30, 2022 Revenue - external customers $ 10,156,328 $ 9,046,075 $ 1,268,623 $ — $ 20,471,026 Intersegment revenue — 199,059 — (199,059) — Total revenue $ 10,156,328 $ 9,245,134 $ 1,268,623 $ (199,059) $ 20,471,026 Gross profit $ 3,421,863 $ 4,723,382 $ 542,326 $ — $ 8,687,571 Identifiable assets $ 10,639,810 $ 10,308,988 $ 3,754,321 $ 5,368,204 $ 30,071,323 (1) Corporate, intersegment revenue, other and elimination includes various corporate assets. |
Description of business and b_3
Description of business and basis of presentation - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||||||
Mar. 15, 2023 USD ($) | Jan. 12, 2023 USD ($) | Apr. 14, 2022 USD ($) | May 18, 2017 | Dec. 31, 2021 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | |
Business Acquisition [Line Items] | ||||||||
Ownerhsip interest in American DG New York, LLC (percent) | 51% | |||||||
Number of business segments | segment | 3 | |||||||
Employee Retention Credit | $ 713,269 | |||||||
Accrued interest received | $ 1,275 | $ 15,775 | ||||||
Employee retention credit receivable | $ 46,148 | $ 713,269 | ||||||
Aegis Energy Services, LLC | ||||||||
Business Acquisition [Line Items] | ||||||||
Total fair value of consideration transferred | $ 2,003,510 | $ 667,121 | $ 564,027 | $ 562,752 | ||||
Accounts receivable credit issued | 300,000 | |||||||
Cash | $ 170,000 | |||||||
American DG Energy, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Ownership interest (percent) | 100% |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 7,112,530 | $ 6,618,110 | $ 19,241,106 | $ 20,471,026 |
Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 2,938,789 | 3,206,732 | 7,094,556 | 10,156,328 |
Maintenance services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 3,842,600 | 3,078,604 | 10,931,744 | 9,025,966 |
Energy production | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 331,141 | 332,774 | 1,214,806 | 1,268,623 |
Installation services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 20,109 | |||
Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 2,938,789 | 3,206,732 | 7,094,556 | 10,156,328 |
Maintenance services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 3,890,685 | 3,119,994 | 11,134,186 | 9,245,134 |
Energy production | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 331,141 | 332,774 | 1,214,806 | 1,268,623 |
Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 7,112,530 | 6,618,110 | 19,241,106 | 20,471,026 |
Operating Segments | Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 2,938,789 | 3,206,732 | 7,094,556 | 10,156,328 |
Operating Segments | Products | Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 2,938,789 | 3,206,732 | 7,094,556 | 10,156,328 |
Operating Segments | Products | Maintenance services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Products | Energy production | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Products | Installation services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | |||
Operating Segments | Maintenance services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 3,842,600 | 3,078,604 | 10,931,744 | 9,046,075 |
Operating Segments | Maintenance services | Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Maintenance services | Maintenance services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 3,842,600 | 3,078,604 | 10,931,744 | 9,025,966 |
Operating Segments | Maintenance services | Energy production | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Maintenance services | Installation services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 20,109 | |||
Operating Segments | Energy production | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 331,141 | 332,774 | 1,214,806 | 1,268,623 |
Operating Segments | Energy production | Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Energy production | Maintenance services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Operating Segments | Energy production | Energy production | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 331,141 | $ 332,774 | $ 1,214,806 | 1,268,623 |
Operating Segments | Energy production | Installation services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 0 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Revenue Recognition [Abstract] | |
Revenue billed this period that had been recognized in previous periods | $ 16,428 |
Deferred revenue recognized | 746,111 |
Remaining performance obligations | $ 1,945,963 |
Performance obligation revenue expected to be recognized over the next 24 months (percent) | 94% |
Performance obligation revenue to be recognized in first 12 months (percent) | 85.10% |
Performance obligation revenue to be recognized over the subsequent 12 months (percent) | 8.90% |
Loss Per Common Share - Schedul
Loss Per Common Share - Schedule of Income (Loss) Per Common Share, Basic and Diluted (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net loss available to stockholders | $ (481,573) | $ (256,712) | $ (2,751,711) | $ (1,023,521) |
Weighted average shares outstanding - basic | 24,850,261 | 24,850,261 | 24,850,261 | 24,850,261 |
Effect of dilutive securities: | ||||
Weighted average shares outstanding - Diluted | 24,850,261 | 24,850,261 | 24,850,261 | 24,850,261 |
Net income (loss) per share - basic (in USD per share) | $ (0.02) | $ (0.01) | $ (0.11) | $ (0.04) |
Net income (loss) per share - diluted (in usd per share) | $ (0.02) | $ (0.01) | $ (0.11) | $ (0.04) |
Stock Options | ||||
Effect of dilutive securities: | ||||
Stock options | 0 | 0 | 0 | 0 |
Anti-dilutive shares underlying stock options outstanding | 1,829,051 | 971,001 | 1,829,051 | 836,001 |
Inventory (Details)
Inventory (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials, net | $ 9,545,184 | $ 9,001,491 |
Work-in-process | 706,731 | 498,139 |
Finished goods | 787,398 | 983,099 |
Inventories, net | $ 11,039,313 | $ 10,482,729 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property and Equipment (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 5,435,352 | $ 5,290,778 |
Less - accumulated depreciation and amortization | (4,180,696) | (3,883,058) |
Property and equipment, net, before construction in progress | 1,254,656 | 1,407,720 |
Energy systems | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,810,232 | 2,810,232 |
Energy systems | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life - years | 1 year | |
Energy systems | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life - years | 15 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,758,601 | 1,624,885 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life - years | 5 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life - years | 7 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 206,865 | 196,007 |
Useful life - years | 5 years | |
Computer software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 192,865 | 192,865 |
Computer software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life - years | 3 years | |
Computer software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life - years | 5 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 466,789 | $ 466,789 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Depreciation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization expense | $ 112,783 | $ 125,755 | $ 352,192 | $ 376,365 |
Intangible Assets and Liabili_3
Intangible Assets and Liabilities Other Than Goodwill -Amounts related to intangible assets (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | $ 4,172,999 | $ 2,581,672 |
Less - accumulated amortization | (1,865,097) | (1,584,078) |
Intangible assets, net | 2,307,902 | 997,594 |
Unfavorable contract liability | 2,618,168 | 2,618,168 |
Less - accumulated amortization | (1,968,383) | (1,797,951) |
Unfavorable contract liability, net | 649,785 | 820,217 |
Product Certifications | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 777,465 | 777,465 |
Less - accumulated amortization | (639,073) | (584,863) |
Intangible assets, net | 138,392 | 192,602 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 888,910 | 888,910 |
Less - accumulated amortization | (474,882) | (405,140) |
Intangible assets, net | 414,028 | 483,770 |
Developed Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 240,000 | 240,000 |
Less - accumulated amortization | (168,000) | (156,000) |
Intangible assets, net | 72,000 | 84,000 |
Favorable contract asset | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 384,465 | 384,465 |
Less - accumulated amortization | (375,213) | (372,091) |
Intangible assets, net | 9,252 | 12,374 |
TTcogen Intangible Assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 1,591,327 | 0 |
Less - accumulated amortization | (113,666) | 0 |
Intangible assets, net | 1,477,661 | 0 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 26,896 | 26,896 |
Less - accumulated amortization | 0 | 0 |
Intangible assets, net | 26,896 | 26,896 |
In Process R&D | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets | 263,936 | 263,936 |
Less - accumulated amortization | (94,263) | (65,984) |
Intangible assets, net | $ 169,673 | $ 197,952 |
Intangible Assets and Liabili_4
Intangible Assets and Liabilities Other Than Goodwill (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 113,477 | $ 49,885 | $ 280,671 | $ 150,376 |
Net credit to cost of sales for amortization of contract related intangible assets and liabilities | $ 54,576 | $ 69,370 | 170,084 | 202,753 |
Gain on termination of unfavorable contract liability | $ 0 | $ (71,375) |
Intangible Assets and Liabili_5
Intangible Assets and Liabilities Other Than Goodwill - Future Amortization of Customer Contracts (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Non-contract Related Intangibles [Abstract] | |||
Total | $ 2,307,902 | $ 997,594 | |
Contract-related Intangibles [Abstract] | |||
Gain on termination of unfavorable contract liability | 0 | $ 71,375 | |
Contract Asset and Liability | |||
Non-contract Related Intangibles [Abstract] | |||
Year 4 | 339,516 | ||
Year 5 | 239,690 | ||
Contract-related Intangibles [Abstract] | |||
Year 1 | 198,654 | ||
Year 2 | 290,403 | ||
Year 3 | 328,727 | ||
Thereafter | 234,231 | ||
Total | 1,631,221 | ||
Non-contract Related Intangible Assets | Contract Asset and Liability | |||
Non-contract Related Intangibles [Abstract] | |||
Year 1 | 172,412 | ||
Year 2 | 178,779 | ||
Year 3 | 174,763 | ||
Year 4 | 172,340 | ||
Year 5 | 63,940 | ||
Thereafter | 41,111 | ||
Total | 803,345 | ||
Customer Contracts | Contract Asset and Liability | |||
Contract-related Intangibles [Abstract] | |||
Year 1 | 26,242 | ||
Year 2 | 111,624 | ||
Year 3 | 153,964 | ||
Year 4 | 167,176 | ||
Year 5 | 175,750 | ||
Thereafter | 193,120 | ||
Total | $ 827,876 |
Aegis Contract and Related As_3
Aegis Contract and Related Asset Acquisition (Details) | 3 Months Ended | 7 Months Ended | ||||
Mar. 15, 2023 USD ($) employee vehicle | Jan. 12, 2023 USD ($) | Apr. 14, 2022 USD ($) | Sep. 30, 2023 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2023 USD ($) | |
Asset Acquisition [Line Items] | ||||||
Inventory adjustment | $ 20,130 | |||||
Accounts payable adjustment | $ 20,130 | |||||
Aegis Energy Services, LLC | ||||||
Asset Acquisition [Line Items] | ||||||
Assets acquired | vehicle | 8 | |||||
Employees acquired | employee | 8 | |||||
Cash | $ 170,000 | |||||
Accounts receivable credit issued | 300,000 | |||||
Account payable | 91,048 | |||||
Contingent consideration | 1,442,462 | |||||
Total fair value of consideration transferred | 2,003,510 | $ 667,121 | $ 564,027 | $ 562,752 | ||
Property, plant and equipment | 170,000 | |||||
Inventory | 391,048 | |||||
Identifiable intangible asset - customer contracts | 1,591,327 | |||||
Assets acquired | 2,152,375 | |||||
Deferred maintenance reserve | (871,856) | |||||
Liabilities assumed | (871,856) | |||||
Net identifiable assets acquired | 1,280,519 | |||||
Goodwill | 722,991 | |||||
Total revenues | $ 1,231,537 | |||||
Net income (loss) | $ 766,804 | |||||
Contingent consideration | 205,246 | |||||
Deferred maintenance reserve | 570,745 | |||||
Liabilities assumed, current | 775,991 | |||||
Contingent consideration | 1,206,077 | |||||
Deferred maintenance reserve | 279,600 | |||||
Liabilities assumed, noncurrent | $ 1,485,677 | |||||
Aegis Energy Services, LLC | Measurement Input, Discount Rate | ||||||
Asset Acquisition [Line Items] | ||||||
Intangible Assets, Measurement Input | 15% | |||||
Aegis Energy Services, LLC | Measurement Input, WACC | ||||||
Asset Acquisition [Line Items] | ||||||
Intangible Assets, Measurement Input | 12% |
Sale of Energy Producing Asse_2
Sale of Energy Producing Assets and Goodwill Impairment (Details) $ in Millions | 3 Months Ended |
Jun. 30, 2021 USD ($) site sale | |
Discontinued Operations and Disposal Groups [Abstract] | |
Number of sales of energy producing assets | sale | 2 |
Number of energy producing sites sold | site | 8 |
Consideration received | $ | $ 7 |
Leases (Details)
Leases (Details) | 3 Months Ended | 9 Months Ended | ||||
Jan. 01, 2024 USD ($) | Sep. 30, 2023 USD ($) ft² | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) ft² | Sep. 30, 2022 USD ($) | Jun. 30, 2023 ft² | |
Lessee, Lease, Description [Line Items] | ||||||
Lease cost | $ 209,506 | $ 201,578 | $ 616,062 | $ 608,652 | ||
Cash paid for amounts included in the measurement of operating lease liabilities | 558,028 | 549,402 | ||||
Right-of-use assets obtained in exchange for operating lease liabilities | $ 0 | $ 0 | ||||
Weighted-average remaining lease term - operating leases | 3 years 10 months 24 days | 3 years 7 months 6 days | 3 years 10 months 24 days | 3 years 7 months 6 days | ||
Weighted-average discount rate - operating leases (percent) | 6% | 6% | 6% | 6% | ||
Square feet of lease | ft² | 43,000 | 43,000 | 26,412 | |||
Rent expense | $ 44,254 | |||||
Lease term | 5 years | 5 years | ||||
Forecast | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Lease cost | $ 38,200 | |||||
Rent expense | $ 24,800 | |||||
Minimum | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Lease improvement costs | $ 1,000,000 | |||||
Maximum | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Lease improvement costs | $ 1,250,000 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities, Lessee (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Right of use assets | $ 754,957 | $ 1,245,549 |
Operating Lease, Liability, Current | 367,938 | 687,589 |
Operating Lease, Liability, Noncurrent | 429,737 | 623,452 |
Total | $ 797,675 | $ 1,311,041 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Lease obligations, current | Lease obligations, current |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Lease obligations, net of current portion | Lease obligations, net of current portion |
Leases - Future Minimum Lease C
Leases - Future Minimum Lease Commitments (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Year 1 | $ 398,741 | |
Year 2 | 127,092 | |
Year 3 | 119,902 | |
Year 4 | 61,044 | |
Year 5 | 53,752 | |
Thereafter | 130,553 | |
Total lease payments | 891,084 | |
Less: imputed interest | 93,409 | |
Total | $ 797,675 | $ 1,311,041 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Noncash Expense | $ 68,775 | $ 69,118 | $ 174,711 | $ 254,718 |
Fair value of options | $ 244,625 | |||
Weighted average grant date fair value (in dollars per share) | $ 0.43 | |||
Share-based Payment Arrangement, Nonemployee | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Price (dollars per share) | $ 0.88 | 0.88 | ||
Share-based Payment Arrangement, Nonemployee | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Price (dollars per share) | $ 1.10 | $ 1.10 | ||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost not yet recognized, amount | $ 568,334 | $ 568,334 | ||
Compensation cost not yet recognized, period for recognition | 2 years 7 months 20 days | |||
Nonqualified Options | Share-based Payment Arrangement, Nonemployee | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (shares) | 575,000 | |||
2022 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares remaining available for future issuance | 3,025,000 | 3,025,000 | ||
Tecogen | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (shares) | 575,000 | |||
Tecogen | Amended Plan | Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares of common stock reserved for future issuance | 3,838,750 | 3,838,750 | ||
Number of shares remaining available for future issuance | 191,193 | 191,193 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock Option Activity (Details) - USD ($) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Sep. 30, 2023 | Dec. 31, 2022 | |
Exercise Price Per Share [Abstract] | |||
Exercise Price Per Share, Outstanding, Minimum (per share) | $ 1.10 | $ 0.71 | |
Exercise Price Per Share, Outstanding, Maximum (dollars per share) | 3.20 | $ 10.33 | |
Exercise price per share, Vested and expected to vest (dollars per share) | 0.71 | ||
Minimum | |||
Exercise Price Per Share [Abstract] | |||
Exercise price per share, Granted (dollars per share) | 0.88 | ||
Maximum | |||
Exercise Price Per Share [Abstract] | |||
Exercise price per share, Granted (dollars per share) | $ 1.10 | ||
Tecogen | |||
Stock Options Outstanding [Roll Forward] | |||
Beginning (shares) | 3,204,297 | ||
Granted (shares) | 575,000 | ||
Exercised (shares) | 0 | ||
Canceled and forfeited (shares) | (44,800) | ||
Ending (shares) | 3,734,497 | 3,204,297 | |
Exercisable (shares) | 1,931,322 | ||
Vested and expected to vest (shares) | 3,462,521 | ||
Weighted Average Exercise Price [Roll Forward] | |||
Beginning (usd per share) | $ 1.61 | ||
Granted (usd per share) | 0.93 | ||
Canceled and forfeited (usd per share) | 2.86 | ||
Ending (usd per share) | 1.49 | $ 1.61 | |
Exercisable (usd per share) | 1.97 | ||
Vested and expected to vest (usd per share) | $ 1.53 | ||
Weighted Average Remaining Life | 7 years 3 months 18 days | 7 years 1 month 20 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Outstanding, Aggregate Intrinsic Value | $ 188,529 | $ 882,074 | |
Exercisable, Aggregate Intrinsic Value | 112,578 | ||
Vested and expected to vest, Aggregate Intrinsic Value | $ 177,136 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value on a Recurring Basis (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Unrealized gain (loss) on investment securities | $ (56,246) | $ 0 | $ (18,749) | $ 37,497 | ||
Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Unrealized gain (loss) on investment securities | (18,749) | 37,497 | ||||
Fair Value, Measurements, Recurring | Level 1 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Assets, Fair Value Disclosure | 0 | 0 | 0 | 0 | ||
Fair Value, Measurements, Recurring | Level 2 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Available-for-sale equity securities | 74,995 | 112,492 | 74,995 | 112,492 | $ 93,744 | $ 74,995 |
Unrealized gain (loss) | (18,749) | 37,497 | ||||
Assets, Fair Value Disclosure | 74,995 | 112,492 | 74,995 | 112,492 | ||
Fair Value, Measurements, Recurring | Level 3 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Assets, Fair Value Disclosure | 0 | 0 | 0 | 0 | ||
Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Assets, Fair Value Disclosure | 74,995 | 112,492 | 74,995 | 112,492 | ||
Eurosite Power, Inc. | Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Unrealized gain (loss) on investment securities | (18,749) | 37,497 | ||||
Eurosite Power, Inc. | Fair Value, Measurements, Recurring | Level 1 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Available-for-sale equity securities | 0 | 0 | 0 | 0 | ||
Eurosite Power, Inc. | Fair Value, Measurements, Recurring | Level 2 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Available-for-sale equity securities | 74,995 | 112,492 | 74,995 | 112,492 | ||
Eurosite Power, Inc. | Fair Value, Measurements, Recurring | Level 3 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Available-for-sale equity securities | 0 | 0 | 0 | 0 | ||
Eurosite Power, Inc. | Estimate of Fair Value Measurement | Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Available-for-sale equity securities | $ 74,995 | $ 112,492 | $ 74,995 | $ 112,492 |
Fair Value Measurements - Chang
Fair Value Measurements - Change in Level 2 Assets (Details) - Fair Value, Measurements, Recurring - Level 2 - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value, beginning | $ 93,744 | $ 74,995 |
Unrealized gain (loss) | (18,749) | 37,497 |
Fair value, ending | 74,995 | 112,492 |
Eurosite Power, Inc. | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value, ending | $ 74,995 | $ 112,492 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Nov. 23, 2022 CAD ($) | Dec. 31, 2022 USD ($) |
Loss Contingencies [Line Items] | ||
Damages sought | $ 1,000,000 | |
Guarantee liability | $ 150,000 |
Segments (Details)
Segments (Details) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) segment | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of operating divisions | segment | 3 | ||||
Revenue | $ 7,112,530 | $ 6,618,110 | $ 19,241,106 | $ 20,471,026 | |
Gross profit | 2,926,021 | 2,893,334 | 7,852,356 | 8,687,571 | |
Assets | 29,186,745 | 30,071,323 | 29,186,745 | 30,071,323 | $ 28,252,857 |
Products | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 2,938,789 | 3,206,732 | 7,094,556 | 10,156,328 | |
Gross profit | 1,269,042 | 1,132,489 | 2,593,785 | 3,421,863 | |
Assets | 10,591,087 | 10,639,810 | 10,591,087 | 10,639,810 | |
Maintenance services | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 3,890,685 | 3,119,994 | 11,134,186 | 9,245,134 | |
Gross profit | 1,496,216 | 1,596,249 | 4,771,889 | 4,723,382 | |
Assets | 13,270,545 | 10,308,988 | 13,270,545 | 10,308,988 | |
Energy production | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 331,141 | 332,774 | 1,214,806 | 1,268,623 | |
Gross profit | 160,763 | 164,596 | 486,682 | 542,326 | |
Assets | 3,203,776 | 3,754,321 | 3,203,776 | 3,754,321 | |
Corporate, other and elimination | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | (48,085) | (41,390) | (202,442) | (199,059) | |
Gross profit | 0 | 0 | 0 | 0 | |
Assets | 2,121,337 | 5,368,204 | 2,121,337 | 5,368,204 | |
Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 7,112,530 | 6,618,110 | 19,241,106 | 20,471,026 | |
Operating Segments | Products | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 2,938,789 | 3,206,732 | 7,094,556 | 10,156,328 | |
Operating Segments | Maintenance services | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 3,842,600 | 3,078,604 | 10,931,744 | 9,046,075 | |
Operating Segments | Energy production | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 331,141 | 332,774 | 1,214,806 | 1,268,623 | |
Operating Segments | Corporate, other and elimination | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 0 | 0 | 0 | 0 | |
Intersegment Eliminations | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 0 | 0 | 0 | 0 | |
Intersegment Eliminations | Products | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 0 | 0 | 0 | 0 | |
Intersegment Eliminations | Maintenance services | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 48,085 | 41,390 | 202,442 | 199,059 | |
Intersegment Eliminations | Energy production | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 0 | 0 | 0 | 0 | |
Intersegment Eliminations | Corporate, other and elimination | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | $ (48,085) | $ (41,390) | $ (202,442) | $ (199,059) |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event | Oct. 10, 2023 USD ($) | Oct. 09, 2023 USD ($) |
Reverse Stock Split, Scenario 1 | ||
Subsequent Event [Line Items] | ||
Reverse stock split ratio | 0.25 | |
Reverse Stock Split, Scenario 2 | ||
Subsequent Event [Line Items] | ||
Reverse stock split ratio | 0.2 | |
Reverse Stock Split, Scenario 3 | ||
Subsequent Event [Line Items] | ||
Reverse stock split ratio | 0.167 | |
Earl R. Lewis, III | ||
Subsequent Event [Line Items] | ||
Line of credit limit | $ 1,000,000 | |
Amount of financing | $ 500,000 | $ 500,000 |
Interest rate | 5.12% |