Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2023 | Jun. 04, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-40913 | |
Entity Registrant Name | Alpine 4 Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-5482689 | |
Entity Address, Address Line One | 2525 E Arizona Biltmore Circle | |
Entity Address, Address Line Two | Suite 237 | |
Entity Address, City or Town | Phoenix | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85016 | |
City Area Code | 480 | |
Local Phone Number | 702-2431 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Shell Company | false | |
Entity Ex Transition Period | true | |
Registrant CIK | 0001606698 | |
Fiscal Year End | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 24,650,957 | |
Class B Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 906,012 | |
Class C Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 1,498,539 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | |||
CURRENT ASSETS: | |||||
Cash | $ 2,925,015 | $ 2,673,541 | |||
Accounts receivable, net | 16,068,693 | 17,139,944 | |||
Inventory | 22,234,478 | 25,258,369 | |||
Contract assets | 1,647,435 | 1,402,788 | |||
Prepaid expenses and other current assets | 1,969,978 | 2,428,223 | |||
Total current assets | 44,845,599 | 48,902,865 | |||
Property and equipment, net | 20,155,368 | 19,503,485 | |||
Intangible assets, net | 15,478,610 | 36,282,609 | |||
Right of use (ROU) assets, net | 15,289,327 | 16,407,566 | |||
Goodwill | 7,782,514 | 22,680,084 | |||
Other non-current assets | 948,788 | 1,855,605 | |||
TOTAL ASSETS | 104,500,206 | 145,632,214 | |||
CURRENT LIABILITIES: | |||||
Accounts payable | 18,249,084 | 8,608,554 | |||
Accrued expenses | 7,318,063 | 6,749,890 | |||
Contract liabilities | 5,420,178 | 5,284,285 | |||
Lines of credit, current portion | 11,077,614 | 7,426,814 | |||
Convertible note payable | 995,528 | 0 | |||
Financing lease obligation, current portion | 800,610 | 725,302 | |||
Operating lease obligation, current portion | 1,555,872 | 1,318,885 | |||
Total current liabilities | 52,038,474 | 33,314,866 | |||
Notes payable, non-current portion | 3,104,267 | 4,266,350 | |||
Lines of credit, non-current portion | 442,962 | 7,215,520 | |||
Financing lease obligations, non-current portion | 14,020,830 | 14,592,813 | |||
Operating lease obligations, non-current portion | 14,049,037 | 15,262,494 | |||
Deferred tax liability | 257,805 | 988,150 | |||
TOTAL LIABILITIES | 83,913,375 | 75,640,193 | |||
Commitments and Contingencies (Note 10) | |||||
STOCKHOLDERS' EQUITY | |||||
Additional paid-in capital | [1] | 143,595,686 | 141,723,921 | ||
Accumulated deficit | [1] | (122,773,253) | (71,734,395) | ||
Total stockholders' equity | [1] | 20,825,110 | 69,992,021 | ||
Non-controlling interest | [1] | (238,279) | 0 | ||
Total equity | 20,586,831 | [1] | 69,992,021 | [2] | |
TOTAL LIABILITIES AND EQUITY | 104,500,206 | 145,632,214 | |||
Nonrelated Party | |||||
CURRENT LIABILITIES: | |||||
Notes payable, current portion | 5,983,275 | 3,201,136 | |||
Related Party | |||||
CURRENT LIABILITIES: | |||||
Notes payable, current portion | 638,250 | 0 | |||
Series B Preferred Stock | |||||
STOCKHOLDERS' EQUITY | |||||
Preferred stock | [1] | 3 | 5 | ||
Class A Common Stock | |||||
STOCKHOLDERS' EQUITY | |||||
Common stock | [1] | 2,432 | 2,230 | ||
Class B Common Stock | |||||
STOCKHOLDERS' EQUITY | |||||
Common stock | [1] | 91 | 107 | ||
Class C Common Stock | |||||
STOCKHOLDERS' EQUITY | |||||
Common stock | [1] | $ 151 | $ 153 | ||
[1]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details.[2]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) | Sep. 30, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Series B Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 100 | 100 |
Preferred stock, shares issued (in shares) | 3 | 5 |
Preferred stock, shares outstanding (in shares) | 3 | 5 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 24,331,406 | 22,303,333 |
Common stock, shares outstanding (in shares) | 24,331,406 | 22,303,333 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Common stock, shares issued (in shares) | 906,012 | 1,068,512 |
Common stock, shares outstanding (in shares) | 906,012 | 1,068,512 |
Class C Common Stock | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 15,000,000 | 15,000,000 |
Common stock, shares issued (in shares) | 1,501,840 | 1,529,888 |
Common stock, shares outstanding (in shares) | 1,501,840 | 1,529,888 |
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 | ||||
Income Statement [Abstract] | |||||||
Revenues, net | $ 25,600,804 | $ 27,486,415 | $ 77,984,543 | $ 78,349,695 | |||
Cost of revenues | 22,237,697 | 21,894,759 | 61,617,890 | 62,277,188 | |||
Gross profit | 3,363,107 | 5,591,656 | 16,366,653 | 16,072,507 | |||
Operating expenses: | |||||||
General and administrative expenses | 8,974,652 | 9,584,035 | 29,111,129 | 26,648,323 | |||
Research and development | 1,412,219 | 26,602 | 3,138,655 | 707,281 | |||
Gain on sale of property | 0 | (115,700) | 0 | (5,938,150) | |||
Goodwill impairment losses | 14,897,570 | 0 | 14,897,570 | 0 | |||
Intangible asset impairment losses | 18,407,843 | 0 | 18,407,843 | 0 | |||
Total operating expenses | 43,692,284 | 9,494,937 | 65,555,197 | 21,417,454 | |||
Loss from operations | (40,329,177) | (3,903,281) | (49,188,544) | (5,344,947) | |||
Other income (expenses) | |||||||
Interest expense | (1,196,297) | (1,051,239) | (3,303,912) | (2,636,955) | |||
Gain on debt extinguishment | 490,312 | 0 | 490,312 | 0 | |||
Other income (expense) | (36,510) | (6,126) | 22,596 | 356,805 | |||
Total other income (expenses) | (742,495) | (1,057,365) | (2,791,004) | (2,280,150) | |||
Loss before income tax | (41,071,672) | (4,960,646) | (51,979,548) | (7,625,097) | |||
Income tax benefit | (115,544) | (196,276) | (702,411) | (400,973) | |||
Net loss | (40,956,128) | (4,764,370) | (51,277,137) | (7,224,124) | |||
Net loss attributable to non-controlling interest | 88,520 | [1] | 0 | 238,279 | 0 | ||
Net loss attributable to common shareholders | $ (40,867,608) | [1] | $ (4,764,370) | [1] | $ (51,038,858) | $ (7,224,124) | |
Weighted average shares outstanding | |||||||
Basic (in shares) | [2] | 27,409,203 | 24,721,070 | 25,666,740 | 23,472,306 | ||
Diluted (in shares) | [2] | 27,409,203 | 24,721,070 | 25,666,740 | 23,472,306 | ||
Basic loss per share (in dollars per share) | $ (1.49) | $ (0.19) | $ (1.99) | $ (0.31) | |||
Diluted loss per share (in dollars per share) | $ (1.49) | $ (0.19) | $ (1.99) | $ (0.31) | |||
[1]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details.[2]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) | May 12, 2023 |
Class A Common Stock | |
Conversion ratio | 0.125 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS CHANGES IN STOCKHOLDER'S EQUITY - USD ($) | Total | Conversion of Series D preferred stock to Class A | Conversion of Series C preferred stock to Class A | Total Stockholders’ Equity | Total Stockholders’ Equity Conversion of Series D preferred stock to Class A | Total Stockholders’ Equity Conversion of Series C preferred stock to Class A | Additional Paid-in Capital | Additional Paid-in Capital Conversion of Series B Preferred Stock to Class A Common Stock | Additional Paid-in Capital Conversion of Series D preferred stock to Class A | Additional Paid-in Capital Conversion of Series C preferred stock to Class A | Accumulated Deficit | Noncontrolling Interest | Series B Preferred Stock | Series B Preferred Stock Preferred Stock | Series B Preferred Stock Preferred Stock Conversion of Series B Preferred Stock to Class A Common Stock | Class A Common Stock | Class A Common Stock Common Stock | Class A Common Stock Common Stock Conversion of Class B Common Stock to Class A Common Stock | Class A Common Stock Common Stock Conversion of Series B Preferred Stock to Class A Common Stock | Class A Common Stock Common Stock Conversion of Series D preferred stock to Class A | Class A Common Stock Common Stock Conversion of Series C preferred stock to Class A | Class A Common Stock Common Stock Conversion of Class C Common Stock to Class A Common Stock | Class B Common Stock | Class B Common Stock Common Stock | Class B Common Stock Common Stock Conversion of Class B Common Stock to Class A Common Stock | Class C Common Stock | Class C Common Stock Common Stock | Class C Common Stock Common Stock Conversion of Class C Common Stock to Class A Common Stock | ||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | [1] | 20,224,938 | 1,068,512 | 1,562,635 | ||||||||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2021 | [1] | $ 71,491,476 | $ 71,491,475 | $ 130,348,267 | $ (58,859,082) | $ 0 | $ 5 | $ 2,022 | $ 107 | $ 156 | ||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Conversion of convertible securities (in shares) | [1] | 7,989 | 1,031 | |||||||||||||||||||||||||||||||||||
Conversion of convertible securities | [1] | $ 365,464 | $ 34,622 | $ 365,464 | $ 34,622 | $ 365,463 | $ 34,622 | $ 1 | ||||||||||||||||||||||||||||||
Issuance of shares of common stock for compensation (in shares) | [1] | 4,924 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for compensation | [1] | 99,248 | 99,248 | 99,248 | ||||||||||||||||||||||||||||||||||
Share-based compensation expense | [1] | 93,197 | 93,197 | 93,197 | ||||||||||||||||||||||||||||||||||
Net loss | [1] | (3,999,560) | (3,999,560) | (3,999,560) | ||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2022 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2022 | [1] | 20,238,882 | 1,068,512 | 1,562,635 | ||||||||||||||||||||||||||||||||||
Ending balance at Mar. 31, 2022 | [1] | 68,084,447 | 68,084,446 | 130,940,797 | (62,858,642) | $ 5 | $ 2,023 | $ 107 | $ 156 | |||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | [1] | 20,224,938 | 1,068,512 | 1,562,635 | ||||||||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2021 | [1] | 71,491,476 | 71,491,475 | 130,348,267 | (58,859,082) | 0 | $ 5 | $ 2,022 | $ 107 | $ 156 | ||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Net loss attributable to non-controlling interest | 0 | |||||||||||||||||||||||||||||||||||||
Net loss | (7,224,124) | |||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | [1] | 22,274,897 | 1,068,512 | 1,557,947 | ||||||||||||||||||||||||||||||||||
Ending balance at Sep. 30, 2022 | [1] | 75,458,890 | 75,458,889 | 141,539,601 | (66,083,206) | $ 5 | $ 2,226 | $ 107 | $ 156 | |||||||||||||||||||||||||||||
Beginning balance (in shares) at Mar. 31, 2022 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Mar. 31, 2022 | [1] | 20,238,882 | 1,068,512 | 1,562,635 | ||||||||||||||||||||||||||||||||||
Beginning balance at Mar. 31, 2022 | [1] | 68,084,447 | 68,084,446 | 130,940,797 | (62,858,642) | $ 5 | $ 2,023 | $ 107 | $ 156 | |||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for compensation (in shares) | [1] | 21,482 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for compensation | [1] | 132,309 | 132,309 | 132,307 | $ 2 | |||||||||||||||||||||||||||||||||
Shares issued from ATM (in shares) | [1] | 9,515 | ||||||||||||||||||||||||||||||||||||
Shares issued from ATM | [1] | 55,137 | 55,137 | 55,136 | $ 1 | |||||||||||||||||||||||||||||||||
Share-based compensation expense | [1] | 172,183 | 172,183 | 172,183 | ||||||||||||||||||||||||||||||||||
Net loss | [1] | 1,539,806 | 1,539,806 | 1,539,806 | ||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2022 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2022 | [1] | 20,269,879 | 1,068,512 | 1,562,635 | ||||||||||||||||||||||||||||||||||
Ending balance at Jun. 30, 2022 | [1] | 69,983,882 | 69,983,881 | 131,300,423 | (61,318,836) | $ 5 | $ 2,026 | $ 107 | $ 156 | |||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Exchange of shares of common stock for compensation (in shares) | [1] | 4,688 | (4,688) | |||||||||||||||||||||||||||||||||||
Exchange of shares of common stock for compensation | [1] | 0 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for cash, net of offering costs (in shares) | [1] | 1,811,595 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for cash, net of offering costs | [1] | 9,173,733 | 9,173,733 | 9,173,552 | $ 181 | |||||||||||||||||||||||||||||||||
Shares issued from ATM (in shares) | [1] | 188,735 | ||||||||||||||||||||||||||||||||||||
Shares issued from ATM | [1] | 1,042,186 | 1,042,186 | 1,042,167 | $ 19 | |||||||||||||||||||||||||||||||||
Share-based compensation expense | [1] | 23,459 | 23,459 | 23,459 | ||||||||||||||||||||||||||||||||||
Net loss attributable to non-controlling interest | 0 | |||||||||||||||||||||||||||||||||||||
Net loss | [1] | (4,764,370) | (4,764,370) | (4,764,370) | ||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | [1] | 5 | ||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | [1] | 22,274,897 | 1,068,512 | 1,557,947 | ||||||||||||||||||||||||||||||||||
Ending balance at Sep. 30, 2022 | [1] | 75,458,890 | 75,458,889 | 141,539,601 | (66,083,206) | $ 5 | $ 2,226 | $ 107 | $ 156 | |||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2022 | 5 | 5 | [1] | |||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2022 | 22,303,333 | 22,303,333 | [1] | 1,068,512 | 1,068,512 | [1] | 1,529,888 | 1,529,888 | [1] | |||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2022 | [1] | 69,992,021 | 69,992,021 | 141,723,921 | (71,734,395) | 0 | $ 5 | $ 2,230 | $ 107 | $ 153 | ||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Conversion of convertible securities (in shares) | [1] | 1,428 | (1,428) | |||||||||||||||||||||||||||||||||||
Series B Preferred Share removal (in shares) | [1] | (1) | ||||||||||||||||||||||||||||||||||||
Series B Preferred Share removal | [1] | 0 | 1 | $ (1) | ||||||||||||||||||||||||||||||||||
Share-based compensation expense | [1] | 182,589 | 182,589 | 182,589 | ||||||||||||||||||||||||||||||||||
Net loss | [1] | (5,769,143) | (5,769,143) | (5,769,143) | ||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2023 | [1] | 4 | ||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2023 | [1] | 22,304,761 | 1,068,512 | 1,528,460 | ||||||||||||||||||||||||||||||||||
Ending balance at Mar. 31, 2023 | [1] | 64,405,467 | 64,405,467 | 141,906,511 | (77,503,538) | 0 | $ 4 | $ 2,230 | $ 107 | $ 153 | ||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2022 | 5 | 5 | [1] | |||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2022 | 22,303,333 | 22,303,333 | [1] | 1,068,512 | 1,068,512 | [1] | 1,529,888 | 1,529,888 | [1] | |||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2022 | [1] | 69,992,021 | 69,992,021 | 141,723,921 | (71,734,395) | 0 | $ 5 | $ 2,230 | $ 107 | $ 153 | ||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Net loss attributable to non-controlling interest | (238,279) | |||||||||||||||||||||||||||||||||||||
Net loss | (51,038,858) | |||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2023 | 3 | 3 | [1] | |||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2023 | 24,331,406 | 24,331,406 | [1] | 906,012 | 906,012 | [1] | 1,501,840 | 1,501,840 | [1] | |||||||||||||||||||||||||||||
Ending balance at Sep. 30, 2023 | 20,586,831 | [2] | 20,825,110 | [1] | 143,595,686 | [1] | (122,773,253) | [1] | (238,279) | [1] | $ 3 | [1] | $ 2,432 | [1] | $ 91 | [1] | $ 151 | [1] | ||||||||||||||||||||
Beginning balance (in shares) at Mar. 31, 2023 | [1] | 4 | ||||||||||||||||||||||||||||||||||||
Beginning balance (in shares) at Mar. 31, 2023 | [1] | 22,304,761 | 1,068,512 | 1,528,460 | ||||||||||||||||||||||||||||||||||
Beginning balance at Mar. 31, 2023 | [1] | 64,405,467 | 64,405,467 | 141,906,511 | (77,503,538) | 0 | $ 4 | $ 2,230 | $ 107 | $ 153 | ||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Conversion of convertible securities (in shares) | [1] | (1) | 1,477,400 | 162,500 | 1 | (162,500) | ||||||||||||||||||||||||||||||||
Conversion of convertible securities | [1] | 1,000,809 | 1,000,809 | 1,000,661 | $ 1 | $ (1) | $ 148 | $ 16 | $ (16) | |||||||||||||||||||||||||||||
Adjustment for additional shares issued in connection with the reverse stock split (in shares) | [1] | 29,995 | 73 | |||||||||||||||||||||||||||||||||||
Adjustment for additional shares issued in connection with the reverse stock split | [1] | 3 | 3 | $ 3 | ||||||||||||||||||||||||||||||||||
Share-based compensation expense | [1] | 165,289 | 165,289 | 165,289 | ||||||||||||||||||||||||||||||||||
Net loss | [1] | (4,551,866) | (4,551,866) | (4,551,866) | ||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2023 | [1] | 3 | ||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2023 | [1] | 23,974,657 | 906,012 | 1,528,533 | ||||||||||||||||||||||||||||||||||
Ending balance at Jun. 30, 2023 | [1] | 61,019,702 | 61,019,702 | 143,072,462 | (82,055,404) | $ 3 | $ 2,397 | $ 91 | $ 153 | |||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||
Conversion of convertible securities (in shares) | [1] | 26,749 | (26,749) | |||||||||||||||||||||||||||||||||||
Conversion of convertible securities | [1] | $ 2 | $ (2) | |||||||||||||||||||||||||||||||||||
Adjustment for additional shares issued in connection with the reverse stock split (in shares) | [1] | 56 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for compensation (in shares) | [1] | 80,000 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for compensation | [1] | 91,200 | 91,200 | 91,192 | $ 8 | |||||||||||||||||||||||||||||||||
Issuance of shares of common stock for cash, net of offering costs (in shares) | [1] | 250,000 | ||||||||||||||||||||||||||||||||||||
Issuance of shares of common stock for cash, net of offering costs | [1] | 497,500 | 497,500 | 497,475 | $ 25 | |||||||||||||||||||||||||||||||||
Share-based compensation expense | [1] | (65,443) | (65,443) | (65,443) | ||||||||||||||||||||||||||||||||||
Net loss attributable to non-controlling interest | [1] | (88,520) | (88,520) | |||||||||||||||||||||||||||||||||||
Prior period NCI | [1] | 0 | 149,759 | 149,759 | (149,759) | |||||||||||||||||||||||||||||||||
Net loss | [1] | (40,867,608) | (40,867,608) | (40,867,608) | ||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2023 | 3 | 3 | [1] | |||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2023 | 24,331,406 | 24,331,406 | [1] | 906,012 | 906,012 | [1] | 1,501,840 | 1,501,840 | [1] | |||||||||||||||||||||||||||||
Ending balance at Sep. 30, 2023 | $ 20,586,831 | [2] | $ 20,825,110 | [1] | $ 143,595,686 | [1] | $ (122,773,253) | [1] | $ (238,279) | [1] | $ 3 | [1] | $ 2,432 | [1] | $ 91 | [1] | $ 151 | [1] | ||||||||||||||||||||
[1]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details.[2]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS CHANGES IN STOCKHOLDER'S EQUITY (Parenthetical) | May 12, 2023 |
Class A Common Stock | |
Conversion ratio | 0.125 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
OPERATING ACTIVITIES: | ||
Net loss | $ (51,277,137) | $ (7,224,124) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation | 2,216,444 | 2,313,984 |
Amortization | 2,386,173 | 2,276,256 |
Gain on sale of property | 0 | (5,938,150) |
Stock compensation expense | 373,786 | 520,416 |
Income tax benefit | (730,345) | (471,178) |
Amortization of debt discounts | 620,051 | 0 |
Gain on debt extinguishment | (490,312) | 0 |
Loss on asset disposal | 124,874 | 0 |
Non-cash lease expense | 1,118,239 | 519,818 |
Write off of inventory | 492,469 | 71,552 |
Bad debt expense | 208,927 | 115,835 |
Impairment of goodwill and intangible assets | 33,305,413 | 0 |
Changes in current assets and liabilities: | ||
Accounts receivable | 862,324 | (4,698,142) |
Inventory | 2,598,065 | (634,484) |
Contract assets | (244,647) | (529,602) |
Prepaid expenses and other assets | 1,365,062 | (2,022,333) |
Accounts payable | 9,540,530 | 383,358 |
Accrued expenses | 450,742 | 1,013,225 |
Contract liabilities | 135,893 | (2,989,957) |
Operating lease liability | (976,470) | (419,446) |
Net cash provided by (used in) operating activities | 2,080,081 | (17,712,972) |
INVESTING ACTIVITIES: | ||
Capital expenditures | (2,920,716) | (756,870) |
Proceeds from sale of building | 0 | 12,454,943 |
Proceeds from sale of asset | 0 | 140,710 |
Cash paid in international technology agreement | 0 | (250,000) |
Net cash (used in) provided by investing activities | (2,920,716) | 11,588,783 |
FINANCING ACTIVITIES: | ||
Proceeds from the sale of common stock, net of offering costs | 0 | 10,272,462 |
Net proceeds (repayments) from lines of credit | (3,295,256) | 4,875,062 |
Net proceeds from issuance of convertible notes, non-related party | 1,964,000 | 0 |
Debt issuance costs | (366,620) | 0 |
Repayment of building mortgage | 0 | (4,642,043) |
Cash paid on financing lease obligations | (496,675) | (480,272) |
Net cash provided by financing activities | 1,092,109 | 7,860,599 |
NET INCREASE IN CASH | 251,474 | 1,736,410 |
CASH, BEGINNING BALANCE | 2,673,541 | 3,715,666 |
CASH, ENDING BALANCE | 2,925,015 | 5,452,076 |
CASH PAID FOR: | ||
Interest | 3,853,435 | 2,617,292 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES: | ||
ROU asset and operating lease obligation recognized | 0 | 9,043,595 |
Equipment purchased on note payable | 129,145 | 243,843 |
Conversion of Series D preferred stock to Class A | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES: | ||
Conversion of common stock | 0 | 365,470 |
Conversion of Series C preferred stock to Class A | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES: | ||
Conversion of common stock | 0 | 34,622 |
Nonrelated Party | ||
FINANCING ACTIVITIES: | ||
Net proceeds (repayments) from issuances of notes payable, non-related party | 2,648,410 | (2,164,610) |
Related Party | ||
FINANCING ACTIVITIES: | ||
Proceeds from issuances of note payable, related party | $ 638,250 | $ 0 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The tax provision or benefit from income taxes for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter the Company updates our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. The quarterly tax provision, and the quarterly estimate of our annual effective tax rate, is subject to significant variation due to several factors, including variability in accurately predicting the pre-tax and taxable income and loss, changes in how the Company does business, audit developments, changes in law, regulations, and administrative practices, and relative changes of expenses or losses for which tax benefits are not recognized. Additionally, the effective tax rate can be more or less volatile based on the amount of pre-tax net loss. As of September 30, 2023, the effective income tax rate was significantly lower then the statutory rate due to the impact of recording Goodwill & Intangible asset impairment, and the valuation allowance maintained against the Company's deferred tax assets. The effective tax rate is 0.28% and 1.35%, respectively, for the three and nine months ended September 30, 2023 based on the loss before income tax in the Statement of Operations. This compares to the rate of 3.96% and 5.26%, respectively, for the three and nine months ended September 30, 2022. |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Alpine 4 Holdings, Inc. and its wholly owned subsidiaries (referred to herein collectively as the “Company,” “we,” “us” and “our”) and are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany accounts and transactions for the periods presented have been eliminated in consolidation. Certain reclassifications have been made that have no impact on net earnings and financial position. The unaudited financial statements presented herein include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for the fair statement of the financial condition, results of operations and cash flows for the period. However, these results are not necessarily indicative of results that may be achieved for any other interim period or for the full fiscal year. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules of the Securities and Exchange Commission (“SEC”). The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the SEC on May 5, 2023. The Company was incorporated under the laws of the State of Delaware in April 2014. We are a publicly traded conglomerate that acquires businesses that fit into our disruptive DSF business model of Drivers, Stabilizers, and Facilitators. Going Concern The Company’s financial statements are prepared in accordance with U.S. GAAP applicable to a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business within one year after the date the condensed consolidated financial statements are issued. In accordance with Financial Accounting Standards Board (“FASB”), Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40), our management evaluates whether there are conditions or events, considered in aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the financial statements are issued. As shown in the accompanying condensed consolidated financial statements, the Company has incurred significant recurring losses but has positive cash flows from operations for the current year. Although the Company has experienced net losses of $51.3 million and $7.2 million for the nine months ended September 30, 2023 and 2022, respectively, net cash flows provided by operating activities improved to $2.1 million for the nine months ended September 30, 2023, from $17.7 million used in operating activities for the nine months ended September 30, 2022. As of September 30, 2023, the Company had negative working capital of $7.2 million, which was a decrease of $22.8 million compared to December 31, 2022. The Company has bank financing totaling $35.0 million ($35.0 million in lines of credit including $0.4 million in capital expenditures lines of credit) of which $3.1 million was available and unused as of September 30, 2023. There are four lines of credit that are set to mature during the next twelve months. These four lines of credit total $34.0 million, of which $11.1 million was used as of September 30, 2023, and are shown as a current liability on the condensed consolidated balance sheet. These factors raise substantial doubt about the Company's ability to continue as a going concern. The Company plans to continue to generate additional revenue, improve cash flows from operations, and improve gross profit performance across all of its subsidiaries. The Company also may raise funds through debt financing, securing additional lines of credit, and the sale of shares in public or private offerings. As noted above, the Company has negative working capital and has continued to experience operating losses, which causes doubt as to the ability of the Company to continue. The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's plan of operations, and its ultimate transition to profitable operations are necessary for the Company to continue. The uncertainty that exists with these factors raises substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties. In order to mitigate the risk related to the going concern uncertainty, the Company has a three-fold plan to resolve these risks. First, the operating subsidiaries of Quality Circuit Assembly - West ("QCA-W"), Quality Circuit Assembly - Central ("QCA-C"), Identified Technologies ("IDT"), and RCA Commercial ("RCA") plan to expand their revenues and profits yielding increased cash flow in those operating segments. This plan will allow for an increased level of cash flow to the Company. Second, the Company has expanded its credit facilities at the subsidiary level over the past twelve months to allow for greater borrowing accessibility if needed for the expansion of product lines and sales opportunities and plans to extend or refinance any lines of credit coming due over the next twelve months in order to provide additional financing. Finally, operating companies hard hit by the supply-chain related price increases such as Morris Sheet Metal ("MSM"), Alternative Laboratories ("Alt Labs"), and Excel Construction ("Excel") have begun to experience an easing in the procurement and cost overruns of limited product supply. This subsequently has added to increased cash flow to those entities and less reliance on the Company to fund those activities. Although this plan is in place to mitigate the risk related to the going concern uncertainty, substantial doubt remains due to uncertainty around the growth projections and lack of control of many of the factors included in the Company’s plan. Entity level risks Our operations and performance may depend on global, regional, economic and geopolitical conditions. Russia’s invasion and military attacks on Ukraine have triggered significant sanctions from North American and European leaders. As of the date of this report, those events were continuing to escalate and create increasingly volatile global economic conditions. Resulting changes in North American trade policy could trigger retaliatory actions by Russia, its allies and other affected countries, including China, resulting in a “trade war.” A trade war could result in increased costs for raw materials that we use in our manufacturing and could otherwise limit our ability to sell our products abroad. These increased costs would have a negative effect on our financial condition and profitability. Furthermore, the military conflict between Russia and Ukraine is increasing supply interruptions and further hindering our ability to find the materials we need to make our products. If the conflict between Russia and Ukraine continues for a long period of time, or if other countries become further involved in the conflict, we could face significant adverse effects to our business and financial condition. The Company is not able to fully quantify the impact that these factors will have on the Company’s financial results during 2023 and beyond. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Principles of consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries as of September 30, 2023, and December 31, 2022. Significant intercompany balances and transactions have been eliminated. Use of estimates The condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States, or U.S. GAAP. Preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable. This applies in particular to useful lives of long-lived assets, reserves for accounts receivable and inventory, valuation allowance for deferred tax assets, fair values assigned to intangible assets acquired, and impairment of long-lived assets. Actual results could differ significantly from our estimates. To the extent that there are material differences between these estimates and actual results, the Company’s future financial statement presentation, financial condition, results of operations and cash flows will be affected. Reclassification Certain prior year amounts have been reclassified to conform to the current period presentation. These reclassifications had no impact on net earnings and financial position. The following table summarize the effects of the reclassifications on each financial statement line item for the periods indicated. Consolidated Statements of Operations for the Three and Nine Months ended September 30, 2022 Three months ended 9/30/22 Nine months ended 9/30/22 Previously Filed Effect of Reclassification Current period presentation Previously Filed Effect of Reclassification Current period presentation Cost of revenue 21,218,317 676,442 21,894,759 60,283,597 1,993,591 62,277,188 Gross Profit 6,268,098 (676,442) 5,591,656 18,066,098 (1,993,591) 16,072,507 General and administrative expenses 10,186,857 (602,822) 9,584,035 28,604,937 (1,956,614) 26,648,323 Research and development 88,960 (62,358) 26,602 675,725 31,556 707,281 Total operating expenses 10,160,117 (665,180) 9,494,937 23,342,512 (1,925,058) 21,417,454 Loss from operations (3,892,019) (11,262) (3,903,281) (5,276,414) (68,533) (5,344,947) Interest expense (1,055,687) 4,448 (1,051,239) (2,627,122) (9,833) (2,636,955) Other income (expense) (12,940) 6,814 (6,126) 278,439 78,366 356,805 Total other income (expenses) (1,068,627) 11,262 (1,057,365) (2,348,683) 68,533 (2,280,150) Net income (loss) $ (4,764,370) $ — $ (4,764,370) $ (7,224,124) $ — $ (7,224,124) Cash Cash and cash equivalents consist of cash and short-term investments with original maturities of less than 90 days. As of September 30, 2023, and December 31, 2022, the Company had no cash equivalents. The Company places its cash with credit quality institutions. At times, such amounts may be in excess of the FDIC insurance limit. As of September 30, 2023 and December 31, 2022, deposits in excess of FDIC limits were $2.3 million and $2.0 million, respectively. Major Customers & Vendors The Company had one customer within A4 Technology - RCA segment that made up 10% of total Company accounts receivable as of September 30, 2023. The Company had no customers that made up over 10% of total Company accounts receivable as of December 31, 2022. For the nine months ended September 30, 2023, the Company had no customers that made up over 10% of total Company revenues. For the nine months ended September 30, 2022, the Company had one customer within the A4 Technology - RCA segment that made up 12% of total Company revenues. For the nine months ended September 30, 2023 and 2022, the Company earned 10% and 11%, respectively, of total Company revenues from prime contractors. For the nine months ended September 30, 2023, the Company had no vendors that made up over 10% of total Company purchases. For the nine months ended September 30, 2022, the Company had one vendor within the A4 Technology - RCA segment that made up 14% of total Company purchases. Inventory Inventory for all subsidiaries is valued at weighted average cost. Management compares the cost of inventory with its net realizable value and an allowance is made to write down inventory to net realizable value, if lower. Inventory is segregated into three areas, raw materials, work-in-process and finished goods. Inventory at September 30, 2023, and December 31, 2022, consisted of: September 30, 2023 December 31, 2022 Raw materials $ 9,419,043 $ 9,116,824 Work in process 2,657,123 3,165,876 Finished goods 10,158,312 12,975,669 Inventory $ 22,234,478 $ 25,258,369 Goodwill In financial reporting, goodwill is not amortized, but is tested for impairment annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Events that result in an impairment review include significant changes in the business climate, declines in our operating results, or an expectation that the carrying amount may not be recoverable. We assess potential impairment by considering present economic conditions as well as future expectations. All assessments of goodwill impairment are conducted at the individual reporting unit level. As of September 30, 2023, the reporting units with goodwill were: TDI and RCA. As of December 31, 2022, the reporting units with goodwill were: QCA-W, MSM, Alt Labs, TDI, IDT, Elecjet Corporation ("Elecjet"), and RCA. See Note 3 - Goodwill and Intangible Assets for additional details. Impairment of Long-Lived Assets The Company accounts for long-lived assets in accordance with the provisions of ASC Topic 360, Accounting for the Impairment of Long-Lived Assets. This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when the estimated future cash flows from the use of the asset is less than the carrying amount of that asset. See Note 3 - Goodwill and Intangible Assets for additional details. Fair value measurements Accounting Standards Codification ("ASC") 820, Fair Value Measurements and Disclosures, 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. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. We apply the provisions of fair value measurement to various nonrecurring measurements for our financial and nonfinancial assets and liabilities. The Company's financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, notes payable and lines of credit. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. We calculate the estimated fair value of a reporting unit using a combination of the income and market approaches. For the income approach, we use DCF models developed in connection with our third-party valuation specialists that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates; and estimated discount rates. For the market approach, we use analyses based primarily on market comparables. We base these assumptions on historical data and experience, industry projections, and general economic conditions. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates. As of September 30, 2023, and December 31, 2022, the Company had no financial assets or liabilities that were required to be fair valued on a recurring basis as all of our financial assets and liabilities were Level 1. Research and Development The Company focuses on quality control and development of new products and the improvement of existing products. All costs related to research and development activities are expensed as incurred. During the nine months ended September 30, 2023 and 2022, research and development costs totaled $3.1 million and $0.7 million, respectively. Loss per share The Company presents both basic and diluted net loss per share on the face of the condensed consolidated statements of operations. Basic net loss per share is computed by dividing net loss attributable to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted per share calculations give effect to all potentially dilutive shares of common stock outstanding during the period, including stock options and warrants, using the treasury-stock method. If antidilutive, the effect of potentially dilutive shares of common stock is ignored. The amount of anti-dilutive shares related to stock options and warrants as of September 30, 2023 and 2022 was 2,878,496 and 2,725,270. respectively. The following table illustrates the computation of basic and diluted earnings per share (“EPS”) inclusive of all classes of common stock as the only difference between the classes of common stock are related to the voting rights for the Three and nine months ended September 30, 2023 and 2022: For the Three Months Ended September 30, 2023 For the Three Months Ended September 30, 2022 Net Loss Shares Per Share Amount Net Loss Shares Per Share Amount Basic EPS Net loss attributable to common shareholders $ (40,867,608) 27,409,203 $ (1.49) $ (4,764,370) 24,721,070 $ (0.19) Total $ (40,867,608) $ 27,409,203 $ (1.49) $ (4,764,370) $ 24,721,070 $ (0.19) For the Nine Months Ended September 30, 2023 For the Nine Months Ended September 30, 2022 Net Loss Shares Per Share Amount Net Loss Shares Per Share Amount Basic EPS Net loss attributable to common shareholders $ (51,038,858) 25,666,740 $ (1.99) $ (7,224,124) 23,472,306 $ (0.31) Total $ (51,038,858) 25,666,740 $ (1.99) $ (7,224,124) 23,472,306 $ (0.31) Revenue Recognition The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers ("Topic 606"). The following is a summary of the revenue recognition policy for each of the Company’s subsidiaries. Revenue is recognized under Topic 606, at a point in time and over a period of time, in a manner that reasonably reflects the delivery of its services and products to customers in return for expected consideration and includes the following elements: – executed contract with the Company's customers that it believes are legally enforceable; – identification of performance obligations in the respective contract; – determination of the transaction price for each performance obligation in the respective contract; – allocation of the transaction price to each performance obligation; and – recognition of revenue only when the Company satisfies each performance obligation. QCA and Alt Labs QCA (Circuit boards and cables) and Alt Labs (Supplements) are contract manufacturers and recognize revenue when the products have been built and control has been transferred to the customer. If a deposit for product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. Elecjet Elecjet is a manufacturer of electric components, and a research and development company for battery technology and recognizes revenue when the products have been shipped to the customer. If a deposit for a product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. Identified Technologies Identified Technologies provides 3D mapping drone software and data for industrial job sites and recognizes revenue when the service has been provided to the customer. If a deposit for a product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. Direct Tech Sales (“RCA”) RCA is engaged in the design, manufacture and wholesale distribution of electronics such as televisions, mounting solutions, projectors and screens, audio equipment, digital signage, mobile audio and video systems, and all wire and connecting products throughout the United States of America. RCA recognizes revenue when the products have been shipped to the customer which is also when title transfers. If a deposit for a product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. MSM, Excel and TDI For our construction contracts, revenue is generally recognized over time as our performance creates or enhances an asset that the customer controls as it is created or enhanced. Our fixed price construction projects generally use a cost-to-cost input method to measure our progress towards complete satisfaction of the performance obligation as we believe it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. For certain of our revenue streams, that are performed under time and materials contracts, our progress towards complete satisfaction of such performance obligations is measured using an output method as the customer receives and consumes the benefits of our performance completed to date. Due to uncertainties inherent in the estimation process, it is possible that estimates of costs to complete a performance obligation will be revised in the near-term. For those performance obligations for which revenue is recognized using a cost-to-cost input method, changes in total estimated costs, and related progress towards complete satisfaction of the performance obligation, are recognized on a cumulative catch-up basis in the period in which the revisions to the estimates are made. When the current estimate of total costs for a performance obligation indicate a loss, a provision for the entire estimated loss on the unsatisfied performance obligation is made in the period in which the loss becomes evident. Contract Assets and Contract Liabilities The timing of revenue recognition may differ from the timing of invoicing to customers. Contract assets include unbilled amounts from our construction projects when revenues recognized under the cost-to-cost measure of progress exceed the amounts invoiced to our customers, as the amounts cannot be billed under the terms of our contracts. Such amounts are recoverable from our customers based upon various measures of performance, including achievement of certain milestones, completion of specified units or completion of a contract. In addition, many of our time and materials arrangements, are billed pursuant to contract terms that are standard within the industry, resulting in contract assets being recorded, as revenue is recognized in advance of billings. Our contract assets do not include capitalized costs to obtain and fulfill a contract. Contract assets are generally classified as current within the consolidated balance sheets. Contract liabilities from our construction contracts arise when amounts invoiced to our customers exceed revenues recognized under the cost-to-cost measure of progress. Contract liabilities additionally include advanced payments from our customers on certain contracts. Contract liabilities decrease as we recognize revenue from the satisfaction of the related performance obligation. The following tables present our revenues disaggregated by type for the three months ended September 30, 2023 and 2022: Three Months Ended September 30, 2023 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 10,767,541 $ — $ 8,062,587 $ — $ 18,830,128 Sale of services 4,305,614 — 2,074,058 — 391,004 6,770,676 Total revenues $ 4,305,614 $ 10,767,541 $ 2,074,058 $ 8,062,587 $ 391,004 $ 25,600,804 Three Months Ended September 30, 2022 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 7,354,658 $ — $ 11,581,471 $ — $ 18,936,129 Sale of services 5,097,834 — 3,098,735 — 353,717 8,550,286 Total revenues $ 5,097,834 $ 7,354,658 $ 3,098,735 $ 11,581,471 $ 353,717 $ 27,486,415 The following tables present our revenues disaggregated by type for the nine months ended September 30, 2023 and 2022: Nine Months Ended September 30, 2023 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 32,974,478 $ — $ 24,278,970 $ — $ 57,253,448 Sale of services 12,112,504 — 7,457,508 — 1,161,083 20,731,095 Total revenues $ 12,112,504 $ 32,974,478 $ 7,457,508 $ 24,278,970 $ 1,161,083 $ 77,984,543 Nine Months Ended September 30, 2022 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 23,533,228 $ — $ 30,631,117 $ — $ 54,164,345 Sale of services 14,823,297 — 8,258,923 — 1,103,130 24,185,350 Total revenues $ 14,823,297 $ 23,533,228 $ 8,258,923 $ 30,631,117 $ 1,103,130 $ 78,349,695 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Note 3 - Goodwill and Intangible Assets During the third quarter of 2023, the Company considered the sustained decrease in the Company’s publicly quoted share price and market capitalization, adverse impacts from macroeconomic conditions such as inflationary pressures and capital markets accessibility, the war in Ukraine and the war in the Middle East, and unfavorable short-term changes in the investment and operating plans of our primary customers; and as a result of these events concluded that a triggering event occurred which required the Company to perform an interim quantitative impairment test as of September 30, 2023. This assessment involved comparing the estimated fair value of each of its reporting units to the reporting unit’s carrying value, inclusive of the goodwill balance allocated to the reporting unit. Based upon the results of the impairment test, the Company concluded that the carrying value of certain reporting units exceeded their estimated fair value, resulting in a goodwill and long-lived intangible assets impairment charge. This impairment charge will not impact the Company’s cash flow. 2023 Year-to-Date Goodwill Impairment Testing Due to the triggering event noted above, the Company performed an interim quantitative impairment test as of September 30, 2023. We calculate the estimated fair value of a reporting unit using a combination of the income and market approaches. Under the income approach, we utilized the discounted cash flow models developed in connection with our third-party valuation specialists that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates; and estimated discount rates. For the market approach, we use analyses based primarily on market comparables. We base these assumptions on historical data and experience, industry projections, and general economic conditions. As a result of our interim impairment test that occurred as of September 30, 2023, we recognized a non-cash Goodwill impairment losses of $14.9 million within operating expenses during the third quarter of 2023. The impairment was primarily due to a decline in market capitalization coupled with sustained expectations of declining revenue growth and decreased margins in future years. After these impairments, the aggregate carrying amount of Goodwill was $7.8 million. Additional Goodwill Impairment Considerations Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual reporting units requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions. These assumptions and estimates include estimated future annual net cash flows, income tax considerations, discount rates, growth rates, royalty rates, contributory asset charges, and other market factors. If current expectations of future growth rates and margins are not met, if market factors outside of our control, such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation, change, or if management’s expectations or plans otherwise change, including updates to our long-term operating plans, then more of our reporting units might become impaired in the future. Additionally, any decisions to divest certain non-strategic assets has led, and could in the future lead, to Goodwill impairments. The reporting units impaired in 2023 were written down to their respective fair values resulting in zero excess fair value over carrying amount as of the applicable impairment test dates. TDI and RCA each have 10% or less excess fair value over carrying amount as of the 2023 interim impairment test and therefore have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future. See Note 8 - Segment Reporting for additional details on the reporting segments that incurred goodwill impairment. Changes in goodwill as of September 30, 2023 were as follows: 2023 Balance as of December 31, 2022 $ 22,680,084 Impairment of goodwill (14,897,570) Balance as of September 30, 2023 $ 7,782,514 Impairment of Long-Lived Assets As a result of our 2023 interim impairment test that occurred as of September 30, 2023, the Company determined that the carrying value of certain intangible assets had exceeded its undiscounted cash flows and, as a result, recorded a non-cash intangible asset impairment charge of $18.4 million in the consolidated statements of operations within operating expenses during the three and nine months ended September 30, 2023. Amortization expense for intangible assets was $0.8 million for the three months and $2.4 million for the nine months ended September 30, 2023 and $0.8 million for the three months and $2.3 million for the nine months ended September 30, 2022. Changes in the carrying amount of intangible assets were as follows: Software Non-compete Customer lists Patents, trademarks, and licenses Proprietary technology Intangible assets, Net Balance as of December 31, 2022 $ 51,390 $ 947,766 $ 11,299,860 $ 6,165,150 $ 17,818,443 $ 36,282,609 Impairment of intangible assets — — (623,179) (5,302,432) (12,482,232) (18,407,843) Amortization expense (51,390) (151,000) (767,058) (432,830) (993,878) (2,396,156) Balance as of September 30, 2023 $ — $ 796,766 $ 9,909,623 $ 429,888 $ 4,342,333 $ 15,478,610 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment and finance lease liabilities on the consolidated balance sheets.When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company discounts lease payments based on an estimate of its incremental borrowing rate. As of September 30, 2023, the future minimum finance and operating lease payments were as follows: Twelve Months Ending September 30, Finance Operating 2024 $ 1,958,956 $ 2,427,879 2025 1,934,916 2,132,342 2026 1,871,566 1,795,302 2027 1,911,880 1,832,680 2028 1,944,907 1,585,379 Thereafter 13,391,240 12,063,124 Total payments 23,013,465 21,836,706 Less: imputed interest (8,192,025) (6,231,797) Total obligation 14,821,440 15,604,909 Less: current portion (800,610) (1,555,872) Non-current lease obligations $ 14,020,830 $ 14,049,037 Finance Leases As of September 30, 2023, all finance leases in the table above were related to property and equipment. Depreciation expense associated with the finance leases within property and equipment, net was $938,863 and $938,863 for the nine months ended September 30, 2023 and 2022, respectively. Of this amount $133,508 and $0 is recorded within cost of revenues with the remainder recorded in general & administrative expenses on the condensed consolidated statements of operations for the nine months ended September 30, 2023 and 2022, respectively. Interest expense on finance leases for the nine months ended September 30, 2023, and 2022 was $907,063 and $946,241, respectively, and is recorded in interest expense on the condensed consolidated statements of operations. At September 30, 2023, the weighted average remaining lease terms were 11.2 years, and the weighted average discount rate was 8.01%. Operating Leases The table below presents the operating lease related assets and liabilities recorded on the Company’s condensed consolidated balance sheets as of September 30, 2023, and December 31, 2022: September 30, December 31, Assets Operating lease assets Operating lease right of use assets $ 15,289,327 $ 16,407,566 Total lease assets $ 15,289,327 $ 16,407,566 Liabilities Current liabilities Operating lease liability Current operating lease liability $ 1,555,872 $ 1,318,885 Noncurrent liabilities Operating lease liability Long-term operating lease liability 14,049,037 15,262,494 Total lease liability $ 15,604,909 $ 16,581,379 The lease expense for the nine months ended September 30, 2023 and 2022, were $1,938,803 and $519,818, respectively. Of this amount $404,993 and $0 were recorded within cost of revenues with the remainder recorded in general and administrative expense on the condensed consolidated statements of operations for the nine months ended September 30, 2023 and 2022, respectively. The cash paid under operating leases during the nine months ended September 30, 2023 and 2022, were $1,172,383 and $645,065, respectively. At September 30, 2023, the weighted average remaining lease terms were 11.3 years, and the weighted average discount rate was 6.02%. |
Leases | Leases The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment and finance lease liabilities on the consolidated balance sheets.When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company discounts lease payments based on an estimate of its incremental borrowing rate. As of September 30, 2023, the future minimum finance and operating lease payments were as follows: Twelve Months Ending September 30, Finance Operating 2024 $ 1,958,956 $ 2,427,879 2025 1,934,916 2,132,342 2026 1,871,566 1,795,302 2027 1,911,880 1,832,680 2028 1,944,907 1,585,379 Thereafter 13,391,240 12,063,124 Total payments 23,013,465 21,836,706 Less: imputed interest (8,192,025) (6,231,797) Total obligation 14,821,440 15,604,909 Less: current portion (800,610) (1,555,872) Non-current lease obligations $ 14,020,830 $ 14,049,037 Finance Leases As of September 30, 2023, all finance leases in the table above were related to property and equipment. Depreciation expense associated with the finance leases within property and equipment, net was $938,863 and $938,863 for the nine months ended September 30, 2023 and 2022, respectively. Of this amount $133,508 and $0 is recorded within cost of revenues with the remainder recorded in general & administrative expenses on the condensed consolidated statements of operations for the nine months ended September 30, 2023 and 2022, respectively. Interest expense on finance leases for the nine months ended September 30, 2023, and 2022 was $907,063 and $946,241, respectively, and is recorded in interest expense on the condensed consolidated statements of operations. At September 30, 2023, the weighted average remaining lease terms were 11.2 years, and the weighted average discount rate was 8.01%. Operating Leases The table below presents the operating lease related assets and liabilities recorded on the Company’s condensed consolidated balance sheets as of September 30, 2023, and December 31, 2022: September 30, December 31, Assets Operating lease assets Operating lease right of use assets $ 15,289,327 $ 16,407,566 Total lease assets $ 15,289,327 $ 16,407,566 Liabilities Current liabilities Operating lease liability Current operating lease liability $ 1,555,872 $ 1,318,885 Noncurrent liabilities Operating lease liability Long-term operating lease liability 14,049,037 15,262,494 Total lease liability $ 15,604,909 $ 16,581,379 The lease expense for the nine months ended September 30, 2023 and 2022, were $1,938,803 and $519,818, respectively. Of this amount $404,993 and $0 were recorded within cost of revenues with the remainder recorded in general and administrative expense on the condensed consolidated statements of operations for the nine months ended September 30, 2023 and 2022, respectively. The cash paid under operating leases during the nine months ended September 30, 2023 and 2022, were $1,172,383 and $645,065, respectively. At September 30, 2023, the weighted average remaining lease terms were 11.3 years, and the weighted average discount rate was 6.02%. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt The outstanding balances for the debts as of September 30, 2023, and December 31, 2022, were as follows: September 30, December 31, Lines of credit, current portion $ 11,077,614 $ 7,426,814 Equipment loans, current portion 291,710 68,410 Related party term notes, current portion 638,250 — Term notes, current portion 5,691,565 3,132,726 Total current 17,699,139 10,627,950 Lines of credit, net of current portion 442,962 7,215,520 Notes Payable, net of current portion 3,104,267 4,266,350 Total notes payable and lines of credit $ 21,246,368 $ 22,109,820 Future scheduled maturities of outstanding debt are as follows: Twelve Months Ending September 30, 2024 $ 17,699,139 2025 2,748,849 2026 628,474 2027 83,431 2028 17,084 Thereafter 69,391 Total $ 21,246,368 In August 2020, the Company filed a lawsuit against Alan Martin regarding his note payable. On July 31, 2023, the Company and Mr. Martin agreed to a settlement to resolve litigation surrounding this matter, which was subsequently amended on October 26, 2023. (See a description of the Company’s ongoing legal proceedings relating to this transaction in Note 10, Commitments and Contingencies, below.) As of the date of the settlement, the note had a balance of $2.9 million, and accrued interest and late fees of $2.0 million, which were reflected in current liabilities. On September 29, 2023, RCA Commercial Electronics entered into an amendment to its credit agreement with JPMorgan Chase Bank to revise the maturity date of the credit agreement to December 8, 2023. On September 29, 2023, the Company and certain of its subsidiaries (collectively, the “Borrowers”) entered into a Standard Merchant Cash Advance Agreement (the “Cash Advance Agreement”) for gross proceeds of $2,100,000 with Cedar Advance, LLC ("Cedar"), an unrelated third-party financial institution, for the purchase and sale of future receipts pursuant to which the Company sold in the aggregate $2,982,000 in future receipts of the Company and the Borrowers for gross proceeds of $2,100,000. The financing arrangement includes issuance costs of $100,000 and is presented in the balance sheet as a direct deduction from the carrying amount of the financing arrangement. Under the terms of the Cash Advance Agreement, until the purchase price has been repaid, the Company must pay $93,000 each week for 32 weeks with the first payment being due October 6, 2023. The financing arrangement has an effective interest rate of 42%. The financing arrangement is secured by an interest in collateral of select subsidiaries that had no other banking encumbrances, as well as that of the holding company itself (the “Collateral”), that is defined collectively as: (a) all accounts, including without limitation, all deposit accounts, accounts receivable, and other receivables, as those terms are defined by Article 9 of the Uniform Commercial Code (the “UCC”), now or hereafter owned or acquired by any Borrower; and (b) all proceeds, as defined by Article 9 of the UCC. Prior to the entry into the Cash Advance Agreement, there had been no relationship between the Company or any of its subsidiaries and Cedar. Due to delays in the anticipated closing of the sale of the Company’s shares and warrants pursuant to its outstanding registration statement, the financing was deemed necessary for working capital purposes. During 2023, the Company had five revolving lines of credit in the aggregate of $35.0 million, including one capital expenditures line of credit of $0.4 million. The revolving lines of credit used as of September 30, 2023, totaled $11.5 million with interest rates ranging from WSJ prime plus 2.50% to 4.25% and terms ranging from one In May 2023, the Company issued a one-year $0.4 million convertible note payable to an outside investor with an annual interest rate of 12% with the proceeds to be used for general corporate purposes. In connection with this convertible note payable, the Company issued 13,750 restricted shares of Class A Common Stock to the investor as additional consideration for the purchase of the note and 196,250 restricted shares of Class A Common Stock, which shall be returned to the Company if timely repayments are made against the note. The convertible note was issued with an original issue discount of $24,500. The fair value of the shares issued was determined based on the closing stock price on the date of issuance and after allocating the proceeds was $243,529, which was recorded as debt issuance cost. The carrying value of the note as of September 30, 2023 was $126,482 and is recorded as convertible debt on the condensed consolidated balance sheet. In June 2023, the Company issued a one-year $1.7 million convertible note payable to an outside investor with an annual interest rate of 12% with the proceeds to be used for general corporate purposes. In connection with this convertible note payable, the Company issued 67,400 restricted shares of Class A Common Stock to the investor as additional consideration for the purchase of the note and 1,200,000 restricted shares of Class A Common Stock, which shall be returned to the Company if timely repayments are made against the note. The convertible note was issued with an original issue discount of $242,120. The fair value of the shares issued was determined based on the closing stock price on the date of issuance and after allocating the proceeds was $757,280, which was recorded as debt issuance cost. Further, the Company issued 200,000 warrants to purchase common stock to the investor and 3,579 warrants as a finders fee. The Company calculated the fair value of the warrants using a Black-Scholes option pricing model (Note 7) to be $378,000 and $6,764, respectively, which was recorded as a debt issuance cost. As the warrants have a change of control redemption feature, the warrants are classified as a liability within accrued expenses on the condensed consolidated balance sheet. The carrying value of the note as of September 30, 2023 was $869,046 and is recorded as convertible debt on the condensed consolidated balance sheet. All convertible debt is classified as a current liability on the balance sheet and matures within the next twelve months. |
Convertible Debt
Convertible Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Convertible Debt | Debt The outstanding balances for the debts as of September 30, 2023, and December 31, 2022, were as follows: September 30, December 31, Lines of credit, current portion $ 11,077,614 $ 7,426,814 Equipment loans, current portion 291,710 68,410 Related party term notes, current portion 638,250 — Term notes, current portion 5,691,565 3,132,726 Total current 17,699,139 10,627,950 Lines of credit, net of current portion 442,962 7,215,520 Notes Payable, net of current portion 3,104,267 4,266,350 Total notes payable and lines of credit $ 21,246,368 $ 22,109,820 Future scheduled maturities of outstanding debt are as follows: Twelve Months Ending September 30, 2024 $ 17,699,139 2025 2,748,849 2026 628,474 2027 83,431 2028 17,084 Thereafter 69,391 Total $ 21,246,368 In August 2020, the Company filed a lawsuit against Alan Martin regarding his note payable. On July 31, 2023, the Company and Mr. Martin agreed to a settlement to resolve litigation surrounding this matter, which was subsequently amended on October 26, 2023. (See a description of the Company’s ongoing legal proceedings relating to this transaction in Note 10, Commitments and Contingencies, below.) As of the date of the settlement, the note had a balance of $2.9 million, and accrued interest and late fees of $2.0 million, which were reflected in current liabilities. On September 29, 2023, RCA Commercial Electronics entered into an amendment to its credit agreement with JPMorgan Chase Bank to revise the maturity date of the credit agreement to December 8, 2023. On September 29, 2023, the Company and certain of its subsidiaries (collectively, the “Borrowers”) entered into a Standard Merchant Cash Advance Agreement (the “Cash Advance Agreement”) for gross proceeds of $2,100,000 with Cedar Advance, LLC ("Cedar"), an unrelated third-party financial institution, for the purchase and sale of future receipts pursuant to which the Company sold in the aggregate $2,982,000 in future receipts of the Company and the Borrowers for gross proceeds of $2,100,000. The financing arrangement includes issuance costs of $100,000 and is presented in the balance sheet as a direct deduction from the carrying amount of the financing arrangement. Under the terms of the Cash Advance Agreement, until the purchase price has been repaid, the Company must pay $93,000 each week for 32 weeks with the first payment being due October 6, 2023. The financing arrangement has an effective interest rate of 42%. The financing arrangement is secured by an interest in collateral of select subsidiaries that had no other banking encumbrances, as well as that of the holding company itself (the “Collateral”), that is defined collectively as: (a) all accounts, including without limitation, all deposit accounts, accounts receivable, and other receivables, as those terms are defined by Article 9 of the Uniform Commercial Code (the “UCC”), now or hereafter owned or acquired by any Borrower; and (b) all proceeds, as defined by Article 9 of the UCC. Prior to the entry into the Cash Advance Agreement, there had been no relationship between the Company or any of its subsidiaries and Cedar. Due to delays in the anticipated closing of the sale of the Company’s shares and warrants pursuant to its outstanding registration statement, the financing was deemed necessary for working capital purposes. During 2023, the Company had five revolving lines of credit in the aggregate of $35.0 million, including one capital expenditures line of credit of $0.4 million. The revolving lines of credit used as of September 30, 2023, totaled $11.5 million with interest rates ranging from WSJ prime plus 2.50% to 4.25% and terms ranging from one In May 2023, the Company issued a one-year $0.4 million convertible note payable to an outside investor with an annual interest rate of 12% with the proceeds to be used for general corporate purposes. In connection with this convertible note payable, the Company issued 13,750 restricted shares of Class A Common Stock to the investor as additional consideration for the purchase of the note and 196,250 restricted shares of Class A Common Stock, which shall be returned to the Company if timely repayments are made against the note. The convertible note was issued with an original issue discount of $24,500. The fair value of the shares issued was determined based on the closing stock price on the date of issuance and after allocating the proceeds was $243,529, which was recorded as debt issuance cost. The carrying value of the note as of September 30, 2023 was $126,482 and is recorded as convertible debt on the condensed consolidated balance sheet. In June 2023, the Company issued a one-year $1.7 million convertible note payable to an outside investor with an annual interest rate of 12% with the proceeds to be used for general corporate purposes. In connection with this convertible note payable, the Company issued 67,400 restricted shares of Class A Common Stock to the investor as additional consideration for the purchase of the note and 1,200,000 restricted shares of Class A Common Stock, which shall be returned to the Company if timely repayments are made against the note. The convertible note was issued with an original issue discount of $242,120. The fair value of the shares issued was determined based on the closing stock price on the date of issuance and after allocating the proceeds was $757,280, which was recorded as debt issuance cost. Further, the Company issued 200,000 warrants to purchase common stock to the investor and 3,579 warrants as a finders fee. The Company calculated the fair value of the warrants using a Black-Scholes option pricing model (Note 7) to be $378,000 and $6,764, respectively, which was recorded as a debt issuance cost. As the warrants have a change of control redemption feature, the warrants are classified as a liability within accrued expenses on the condensed consolidated balance sheet. The carrying value of the note as of September 30, 2023 was $869,046 and is recorded as convertible debt on the condensed consolidated balance sheet. All convertible debt is classified as a current liability on the balance sheet and matures within the next twelve months. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity On May 12, 2023, a Certificate of Amendment was filed to effect a one-for-eight (1-for-8) reverse split (the “Reverse Split”) of the shares of the Company’s the Class A, Class B, and Class C Common Stock, and to decrease the number of shares of Class A Common Stock from 295,000,000 shares to 200,000,000 shares (the “Class A Common Stock Decrease”). The Reverse Split and the Class A Common Stock Decrease became effective on May 12, 2023. As a result of the Reverse Split, every eight shares of the Company’s issued and outstanding Class A Common Stock automatically converted into one share of Class A Common Stock, without any change in the par value per share, and began trading on a post-split basis under the Company’s existing trading symbol, “ALPP,” when the market opened on May 15, 2023. Additionally, every eight shares of the Company’s issued and outstanding Class B Common Stock automatically converted into one share of Class B Common Stock, without any change in the par value per share, and every eight shares of the Company’s issued and outstanding Class C Common Stock automatically converted into one share of Class C Common Stock, without any change in the par value per share. The Reverse Split affected all holders of Class A, Class B, and Class C Common Stock uniformly and did not affect any common stockholder’s percentage ownership interest in the Company, except for de minimis changes as a result of the elimination of fractional shares. A total of 180,037,350 shares of Class A Common Stock were issued and outstanding immediately prior to the Reverse Split, and approximately 22,504,669 shares of common stock were issued and outstanding immediately after the Reverse Split. No fractional shares were outstanding following the Reverse Split. Any holder who would have received a fractional share of common stock automatically received an additional fraction of a share of common stock to round up to the next whole share. In addition, effective as of the same time as the Reverse Split, proportionate adjustments were made to all then-outstanding options and warrants with respect to the number of shares of Class A Common Stock subject to such options or warrants and the exercise prices thereof. The impact of this change in capital structure has been retrospectively applied to all periods presented herein. Common Stock The Company had the following transactions in its common stock during the three months ended September 30, 2023: • In July 2023, the Company issued 250,000 shares as part of a settlement agreement at $1.99 per share. • In August 2023, the Company issued 80,000 shares as compensation at $1.25 per share. • In September 2023, certain shareholders converted 26,749 shares of Class C common stock into 26,749 shares of Class A common stock. Stock Options The following table summarizes the stock option activity for the nine months ended September 30, 2023: Options Weighted Weighted Aggregate Outstanding at December 31, 2022 386,751 $ 4.39 7.94 $ 463,495 Granted — — Forfeited (33,248) 6.16 Exercised — — Outstanding at September 30, 2023 353,503 $ 4.22 7.06 $ 36,217 Exercisable at September 30, 2023 158,821 $ 1.85 5.20 $ 36,217 The following table summarizes information about options outstanding and exercisable as of September 30, 2023: Options Outstanding Options Exercisable Exercise Number Weighted Weighted Number Weighted $ 0.40 111,438 4.76 $ 0.40 111,438 $ 0.40 0.80 10,625 4.53 0.80 10,625 0.80 6.16 217,939 8.59 6.16 23,254 6.16 7.20 13,504 3.52 7.20 13,504 7.20 353,506 158,821 During the nine months ended September 30, 2023 and 2022, stock option expense amounted to $0.3 million and $0.1 million, respectively. Unrecognized stock option expense as of September 30, 2023 amounted to $0.7 million, which will be recognized over a period extending through April 2025. Warrants The following table summarizes the warrants activity for the nine months ended September 30, 2023: Warrants Weighted Weighted Aggregate Outstanding at December 31, 2022 2,321,411 $ 11.78 4.31 $ — Granted 203,579 3.51 4.75 Forfeited — — Exercised — — Outstanding at September 30, 2023 2,524,990 $ 11.12 3.62 $ — Exercisable at September 30, 2023 2,524,990 $ 11.12 3.62 $ — The following table summarizes information about warrants outstanding and exercisable as of September 30, 2023: Warrants Outstanding Warrants Exercisable Exercise Number Weighted Weighted Number Weighted $ 52.80 52,084 1.39 $ 52.80 52,084 $ 52.80 20.16 49,604 1.20 20.16 49,604 20.16 24.80 535,716 3.16 24.80 535,716 24.80 24.64 53,572 3.15 24.64 53,572 24.64 5.52 1,630,435 3.79 5.52 1,630,435 5.52 3.50 200,000 4.75 3.50 200,000 3.50 4.20 3,579 4.75 4.20 3,579 4.20 2,524,990 2,524,990 During the nine months ended September 30, 2023, the Company issued 200,000 and 3,579 warrants to two holders in connection with the issuance of a convertible note payable. The warrants have an exercise price of $3.50 and $4.20, respectively, were exercisable as of June 29, 2023, and expire on June 29, 2028. The fair value of the 200,000 and 3,579 warrants at issuance was $378,000 and $6,764, respectively, and was determined using the Black-Scholes option pricing model. The fair value of the warrants as of September 30, 2023, was $145,000 and $2,595, respectively, and was determined using the following assumptions: Stock price $0.73 Risk-free interest rate 5.50% Expected life of the warrants 4.75 Expected volatility 194% Expected dividend yield 0% |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting The Company discloses segment information that is consistent with the way in which management operates and views its business. Effective during the quarter ended September 30, 2023, the Company increased its reportable segments to seven segments. All segments and the subsidiaries within each segment are geographically located in North America. The financial results are logical to review in this manner for comparison, trend, deviations, etc. purposes. Management excludes the following when reviewing the profit/loss by segment. • Intercompany Sales/Cost of Revenues • Management fees to the parent Company • Income tax benefit/expense There has been no change to the measurement method in how management reviews the profit/loss by segment. The operating segments and their business activity are as follows: • A4 Construction Services - MSM provides commercial construction services primarily as a sheet metal contractor. • A4 Manufacturing - QCA-W is a contract manufacturer within the technology industry. • A4 Manufacturing - Alt Labs is a contract manufacturer within the dietary & nutraceutical supplements industry. • A4 Defense - TDI does contracting for the US Government particularly for the US Defense Department and US Department of State. • A4 Technologies - RCA is a business-to-business ("B2B") commercial electronics manufacturer. • A4 Technologies - Elecjet operates as a battery research & development company. • A4 Aerospace - Vayu is a drone aircraft manufacturer. • A4 All Other includes the QCA-C, IDT, Global Autonomous Corporation ("GAC") , Excel and Corporate. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Revenue A4 Construction Services - MSM $ 3,864,819 $ 4,641,335 $ 11,228,351 $ 13,735,021 A4 Manufacturing - QCA 3,678,052 4,006,665 13,189,382 12,566,907 A4 Manufacturing - Alt Labs 6,394,983 2,707,513 17,409,026 9,490,536 A4 Defense - TDI 2,074,058 3,098,735 7,457,508 8,258,923 A4 Technologies - RCA 7,996,701 11,477,833 23,988,744 29,625,368 A4 Technologies - Elecjet 65,886 103,638 290,226 1,005,749 A4 Aerospace - Vayu — — 4,171 25,000 All Other 1,526,305 1,450,696 4,417,135 3,642,191 $ 25,600,804 $ 27,486,415 $ 77,984,543 $ 78,349,695 Gross profit (loss) A4 Construction Services - MSM $ 198,237 $ 96,339 $ 979,932 $ 487,598 A4 Manufacturing - QCA (396,194) 618,625 2,287,710 2,666,538 A4 Manufacturing - Alt Labs 985,610 317,357 3,713,038 1,478,197 A4 Defense - TDI 221,666 903,845 1,782,798 3,043,644 A4 Technologies - RCA 2,567,450 3,805,942 7,693,654 8,186,193 A4 Technologies - Elecjet (71,284) (192,744) (198,093) (205,976) A4 Aerospace - Vayu — (593) 1,706 (6,064) All Other (142,378) 42,885 105,908 422,377 $ 3,363,107 $ 5,591,656 $ 16,366,653 $ 16,072,507 Income (loss) from operations A4 Construction Services - MSM $ (1,322,422) $ (306,425) $ (1,877,443) $ (760,724) A4 Manufacturing - QCA (3,585,823) (29,101) (3,120,210) 656,151 A4 Manufacturing - Alt Labs (5,526,768) (1,324,793) (5,904,542) 2,806,960 A4 Defense - TDI (263,942) 336,401 746,827 1,543,245 A4 Technologies - RCA 434,845 1,635,201 1,855,395 2,394,868 A4 Technologies - Elecjet (12,210,193) (305,485) (12,677,889) (878,385) A4 Aerospace - Vayu (13,141,251) (916,253) (15,342,234) (2,542,581) All Other (4,713,623) (2,992,826) (12,868,448) (8,564,481) $ (40,329,177) $ (3,903,281) $ (49,188,544) $ (5,344,947) Depreciation and amortization A4 Construction Services - MSM $ 627,209 $ 171,960 $ 980,172 $ 509,706 A4 Manufacturing - QCA 101,384 105,573 331,936 314,356 A4 Manufacturing - Alt Labs 196,194 242,527 630,402 803,510 A4 Defense - TDI 72,433 72,338 217,299 216,518 A4 Technologies - RCA 244,804 270,300 734,413 610,399 A4 Technologies - Elecjet 105,666 103,532 317,000 308,665 A4 Aerospace - Vayu 252,704 258,871 771,294 792,765 All Other (110,916) 346,683 620,101 1,034,321 $ 1,489,478 $ 1,571,784 $ 4,602,617 $ 4,590,240 Interest expense A4 Construction Services - MSM $ 649,599 $ 98,811 $ 861,472 $ 340,337 A4 Manufacturing - QCA 150,785 78,269 485,435 202,159 A4 Manufacturing - Alt Labs 88,449 200,285 238,108 351,962 A4 Defense - TDI (33,945) — — — A4 Technologies - RCA 98,347 103,438 256,199 218,686 A4 Technologies - Elecjet — — — — A4 Aerospace - Vayu (11,372) — — — All Other 254,434 570,436 1,462,698 1,523,811 $ 1,196,297 $ 1,051,239 $ 3,303,912 $ 2,636,955 Net income (loss) A4 Construction Services - MSM $ (1,887,597) $ (403,258) $ (2,616,968) $ (1,042,559) A4 Manufacturing - QCA (3,723,975) (148,902) (3,592,218) 386,728 A4 Manufacturing - Alt Labs (5,646,349) (1,512,864) (6,126,408) 2,673,865 A4 Defense - TDI (229,998) 336,401 771,908 1,543,245 A4 Technologies - RCA 336,498 1,531,763 1,599,196 2,176,182 A4 Technologies - Elecjet (12,210,193) (305,413) (12,677,889) (881,858) A4 Aerospace - Vayu (13,186,179) (916,253) (15,427,910) (2,542,581) All Other (4,408,335) (3,345,844) (13,206,848) (9,537,146) $ (40,956,128) $ (4,764,370) $ (51,277,137) $ (7,224,124) The Company’s reportable segments as of September 30, 2023, and December 31, 2022, were as follows: As of September 30, 2023 As of December 31, 2022 Total assets A4 Construction Services - MSM $ 16,059,629 $ 11,309,049 A4 Manufacturing - QCA 16,489,038 20,988,492 A4 Manufacturing - Alt Labs 23,545,683 26,636,905 A4 Defense - TDI 12,569,449 13,497,381 A4 Technologies - RCA 23,791,454 27,191,977 A4 Technologies - Elecjet 548,406 12,897,440 A4 Aerospace - Vayu 1,651,865 14,632,530 All Other 9,844,682 18,478,440 $ 104,500,206 $ 145,632,214 Goodwill A4 Construction Services - MSM $ — $ 113,592 A4 Manufacturing - QCA — 1,963,761 A4 Manufacturing - Alt Labs — 4,410,564 A4 Defense - TDI 6,426,786 6,426,786 A4 Technologies - RCA 1,355,728 1,355,728 A4 Technologies - Elecjet — 6,496,343 A4 Aerospace - Vayu — — All Other — 1,913,310 $ 7,782,514 $ 22,680,084 Accounts receivable, net A4 Construction Services - MSM $ 4,487,235 $ 5,188,521 A4 Manufacturing - QCA 2,634,122 3,867,141 A4 Manufacturing - Alt Labs 2,379,169 1,833,502 A4 Defense - TDI 1,131,434 1,905,314 A4 Technologies - RCA 3,870,943 3,232,559 A4 Technologies - Elecjet 1,257 12,888 A4 Aerospace - Vayu 500,000 — All Other 1,064,533 1,100,019 $ 16,068,693 $ 17,139,944 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Licensing Agreement DTI Services Limited Liability Company (“DTI”) has entered into licensing agreements with RCA Trademark Management for the licensing rights to the respective trademarks in the United States of America and Canada. The RCA licensing agreement was amended with Technicolor, S.A., as licensor, and expires December 31, 2027 except for the agreement relating to Computer Monitors and Outdoor Televisions which expires on December 31, 2025. DTI agreed to pay a royalty fee of 2.50% to 3.50% on net sales based on product type with a total minimum annual payment of $550,000 for the year ended 2023, $600,000 for the year ended 2024, $620,000 for the year ended 2025, $660,000 for the year ended 2026, and $700,000 for the year ended 2027. Warranty Service Agreement DTI entered into an agreement to provide certain warranty services for a lighting supplier through December 31, 2024, except for one class of customer, for whom services will be provided through 2030. In exchange for these services, DTI expects to receive $66,626 and $59,964 during the years ended December 31, 2023 and 2024, respectively. Royalty Agreement On November 28, 2021, the Company entered into a Royalty Agreement with the sellers of Elecjet. The Company desires to build its initial factory (“Factory”) to manufacture graphene batteries in the territory of the United States. The Company agreed to pay the sellers 1.5% of net sales for batteries produced by the Factory. Royalty payments shall continue to be paid for a period of ten years from the starting date, or until the total of the royalty payments equals $50 million, whichever occurs first. Legal Proceedings From time to time, the Company may become involved in lawsuits and other legal proceedings that arise in the course of business. Litigation is subject to inherent uncertainties, and it is not possible to predict the outcome of litigation with total confidence. As of the date of this report, the Company was not aware of any legal proceedings or potential claims against it whose outcome would be likely, individually or in the aggregate, to have a material adverse effect on the Company’s business, financial condition, operating results, or cash flows. Alan Martin Lawsuit In August 2020, in a matter relating to our former subsidiary Horizon Well Testing, LLC (“Horizon”), the Company filed a lawsuit in the United States District Court, District of Arizona (Case No.2:20-cv-01679-DJH), against Alan Martin, the seller of Horizon dba Venture West Energy Services, LLC (“VWES”). The Company brought suit seeking to avoid the claimed liability due from the Company to Alan Martin, for the Company’s 2017 purchase of Mr. Martin’s business, Horizon. On summary judgment, the court found that the Company’s claim was barred by a time-limiting clause for indemnification claims. The Company disagreed with the court’s ruling and planned to appeal. Mr. Martin filed a counterclaim in which he claimed that he remains unpaid on the promissory note, as modified, under which the Company purchased Horizon. The note balance alleged to have a principal sum due of $3.3 million, plus interest at 8% accruing from 2019 to present, plus late fees accruing at $575 per day. After confidential mediation before Hon. Eileen Willett, United States Magistrate Judge for the United States District Court for the District of Arizona, the parties settled their dispute on acceptable terms. The Company and Mr. Martin agreed to an amended settlement agreement whereby Mr. Martin will receive the following: $100,000 payable on or before August 3, 2023; 250,000 shares issued immediately; $250,000 in cash and 250,000 shares on or before October 31, 2023, $2,000,000 payable on or before January 15, 2024 and a $1,800,000 note payable with monthly payments of $75,000 beginning on December 1, 2023 with a final payment of $900,000 payable on or before December 1, 2024, when the Company’s payment promise is backed by a stipulated liability totaling the total amount owed under the agreement. Through the date of this report $380,000 payment in cash and 500,000 shares have been paid and issued by the Company. The January 15, 2024 payment of $2,000,000 was renegotiated with a final due date of December 1, 2024, including an incremental 100,000 warrants, as mutually agreed upon between Mr. Martin and the Company. The Company has not yet made the monthly payments as called for under the modified agreement, and talks between the Company and Mr. Martin are proceeding on a possible further resolution agreeable to both parties. Robert Porter Lawsuit In August 2021, in a matter relating to Horizon, Robert Porter filed a lawsuit in the District Court of Oklahoma County, State of Oklahoma (CJ-2021-3421), alleging unjust enrichment and breach of contract with respect to shares of Company that Mr. Porter claims were owed to him pursuant to his employment contract with the Company as President of Horizon. In October 2021, the Company filed its answer denying such claims. In October 2021, the Company also filed counterclaims against Mr. Porter for conversion and breach of fiduciary duties. The Company believes this lawsuit is without merit and as such, no accrual has been recorded as of September 30, 2023, nor anytime subsequently. Discovery is ongoing, while no trial date has yet been set. VWES Lawsuit In October 2021, in a matter relating to Horizon, the Company received three complaints in the District Court of Oklahoma Country State of Oklahoma from former VWES employees Bruce Morse (CJ-2021-4316), Brian Hobbs (CJ-2021-4315), Thomas Karraker (CJ-2021-4314) for unjust enrichment, and breach of contract with respect to their employment contracts with Horizon. On January 19, 2022, the Company filed answers to all three lawsuits that denied these claims. The Company believes these are frivolous lawsuits. In July 2022, the Company and Mr. Morse settled his claims against the Company. The settlement included the cash payment of $24,375 for Mr. Morse's claimed 4,688 shares of Class A common stock, and subsequently Mr. Morse’s case is pending filing for dismissal. Subsequently, Mr. Hobbs and Mr. Karraker have also expressed interest in settling claims on similar terms, and negotiations were ongoing as of the date of this report. As no formal settlement offer has been extended to Mr. Hobbs or Mr. Karraker, no accrual has been recorded as of September 30, 2023, not anytime subsequently. Gatehouse Lawsuit In June 2022, in a matter relating to the Company’s subsidiaries, DTI Services Limited Liability Company and Direct Tech Sales, LLC (doing business as RCA), the Company received a complaint filed in the Superior Court of Marion County State of Indiana (CAUSE NO. 49D01-2203-PL-006662) by Gatehouse, LLC (“Gatehouse”), a supplier of PPP gloves for resale by RCA, seeking payment of $213,000 for supplied goods that RCA has good reason to believe are counterfeit, and thus unsalable. RCA has answered the complaint and asserted counterclaims of fraud and breach of contract. After a long delay in prosecution of the case by Gatehouse, motion practice has begun in this matter, with discovery proceeding and a pre-trial conference scheduled for June 27th, 2024. Mark Bell Lawsuit In November 2022, the Company and its subsidiaries Excel and A4 Construction received a complaint filed by Mark Bell in the district court of Idaho (CV42-22-4066) with regard to the Company’s February 2020 purchase of Excel Fabrication LLC (“Excel”) from Mr. Bell. The matter relates to the lack of payment on a $2.3 million seller note comprising part of the purchase consideration. In December 2022 the Company counter-sued Mr. Bell for breach of contract, fraud, and misrepresentation in the February 2020 sale of Excel to the Company. The case is set for trial on June 25th, 2024. Starr Corporation Arbitration In December 2022, the Company’s subsidiary Excel received a demand for binding arbitration (AAA Case No. 01-22-0004-9935) by Starr Corporation of Idaho (“Starr Corporation”), a contractor for whom Excel was performing as sub-contractor. Excel stopped its work for Starr Corporation pursuant to its claimed contract right of termination based on Starr Corporation’s failure to make payment within the contracted period for work satisfactorily performed. Starr Corporation claims that Excel’s termination was wrongful, and seeks approximately $0.5 million, reflecting its costs in having to complete work that was called for under the contract. Upon notice to both Starr Corporation and to the Arbitrator that Excel would no longer be participating in the arbitration due to a pending filing by Excel of a petition for bankruptcy under Chapter 7, the arbitration was cancelled by the Arbitrator, with no further proceedings are contemplated in this matter. State University of New York at Stonybrook Lawsuit In February 2023, the Company learned that a complaint was brought in the State of New York against Vayu in 2019 (prior to the Company’s ownership of Vayu) seeking a refund for two returned airframes. The case had originally been dismissed for lack of jurisdiction but was revived by virtue of New York’s highest court ruling (State of New York v Vayu, APL-2021-00148) that the State’s long arm statute applied to the 2016 transaction between Vayu and the State University of New York at Stonybrook. Total damages sought by the State of New York are less than $100,000, including interest and costs. In light of the decision by the Court of Appeals to return the case to the trial courts for adjudication, the Company has expressed its wish to settle the matter and has offered a settlement of $56,300. The Company and the State of NY have each stipulated to a settlement for $56,300, to be filed with the court upon payment by Company of that amount in July 2024, plus applicable interest from the date of the agreed stipulation. Kevin Thomas Lawsuit In May 2023, Kevin Thomas, who sold Alt Labs to the Company in May of 2021, sued the Company and its subsidiaries Alt Labs and A4 Manufacturing in the State circuit court for Collier County Florida (Case Number 23-CA-1981), alleging that the Company failed to deliver shares of the Company as promised by the terms of the purchase agreement. Additionally Mr. Thomas claimed that an amount of $610,000 in Employee Retention Credits was received by the Company and that the portion representing the credit attributed to the first and second quarters of 2021 (prior to the May 4th, 2021 date of sale), should be remitted to him rather than retained by the Company. The Company believes that Mr. Thomas’ complaint is wholly without merit, and and after a period of negotiation and motion practice, on May 3, 2024 the Company agreed to a payment to Mr. Thomas of $85,000 as full settlement of the claims, together with a mutual release of the parties of any other possible claims related to the Company’s purchase of Alt Labs. Steve Page Lawsuit In September 2023, Page Management Inc, who sold TDI to the Company in May of 2021, sued the Company’s A4 Defense subsidiary in the state circuit court for Lee County Florida (Case Number 23-CA-10426), alleging that an amount of $256,433 in Employee Retention Credits was received by the Company attributed to the fourth quarter of 2020 and first quarter of 2021 should be remitted to him rather than retained by the Company. The Company believes that Page Management’s complaint is wholly without merit, and the Company is in the process of considering possible motions and counterclaims., as well as conducting discussions between the parties regarding a possible settlement. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On October 1, 2023, in a matter relating to the Company’s business previously conducted under the subsidiary Deluxe Sheet Metal Inc, (“Deluxe”), an amendment to the lease of a now vacant building leased by Deluxe was executed with the landlord Envision South Bend LLC (“Envision”). The amendment called for a return of the building to Envision upon payment of back rent owed, with the promised backed by a stipulated liability by the Company in an amount totaling the total rent and related expenses owed under the full term of the lease. Payment of the back rent owned was due October 31, 2023, however the Company did not make the required payment, and talks between the Company and Envision are proceeding on a possible further resolution agreeable to both parties. On October 31, 2023, the Company granted 25,000 shares of our Class A common stock to the Chief Financial Officer. On November 6, 2023, MSM entered into an Amended Forbearance agreement extending the forbearance period until November 22, 2023, which was then subsequently amended to January 12, 2024. On November 8, 2023, the Company and certain of its subsidiaries (collectively, the “Borrowers”) entered into a Standard Merchant Cash Advance Agreement for gross proceeds of $1,050,000 with Meged Funding Group, an unrelated third-party financial institution, for the purchase and sale of future receipts pursuant to which the Company sold in the aggregate $1,480,500 in future receipts of the Borrowers for gross proceeds of $1,050,000. The financing arrangement includes issuance costs of $50,000 and has an effective interest rate of 41%. On November 17, 2023, the Company entered into a purchase agreement (the “Purchase Agreement”) and related registration rights agreement (the "Registration Rights Agreement") with Ionic Ventures, LLC (“Ionic Ventures”), which provides that, upon the terms and subject to the conditions and limitations set forth therein, we have the right to direct Ionic Ventures to purchase up to an aggregate of $32,000,000 of shares of our Class A common stock over the 36-month term of the Purchase Agreement. Ionic Ventures' obligation to purchase shares under the Purchase Agreement is subject to the satisfaction of certain commencement conditions, including, without limitation, the effectiveness of the registration statement, our Class A common stock shall be listed or quoted on the Nasdaq Capital Market and all securities to be issued to Ionic Ventures pursuant to the Purchase Agreement shall have been approved for listing on the Nasdaq Capital Market, and our representations and warranties shall be true and correct in all material respects as of the commencement date. On December 9, 2023, in a matter relating to the Company’s subsidiary, Quality Circuit Assembly, Inc. (“QCA”), the Company received a complaint filed in the Superior Court of Santa Clara County, State of California (Case number 23CV428025) by KW FUND VI-SVRD PORTFOLIO, LLC (“KW”), a landlord of a vacant facility rented by QCA but never occupied, seeking damages from QCA as Tenant and from the Company as guarantor for default on the lease. KW seeks $900,000 in damages. The Company and QCA have answered the complaint, and discovery is proceeding, and in addition the parties are in contact regarding possible terms of settlement. On December 20, 2023, Direct Tech Sales, LLC d/b/a RCA Commercial Electronics, an Indiana limited liability company (“DTS”), and DTI Services Limited Liability Company d/b/a RCA Commercial Electronics, an Indiana limited liability company (“DTI” and together with “DTS, individually and collectively, jointly and severally, the “Borrowers”), both of which entities are subsidiaries of Alpine 4 Holdings, Inc., a Delaware corporation (“Alpine 4”) entered into a Loan and Security Agreement (“Loan Agreement”) with North Mill Capital LLC, d/b/a SLR Business Credit, a Delaware limited liability company (the “Lender”). Additionally, and in connection with the Loan Agreement, Alpine 4 entered into a Corporate Guaranty with the Lender, and DTS entered into a Collateral Assignment Agreement with the Lender pursuant to which DTS granted to the Lender a security interest in certain collateral of DTI. On December 27, 2023, the Company and certain of its subsidiaries (collectively, the “Borrowers”) entered into a Standard Merchant Cash Advance Agreement for gross proceeds of $500,000 with AEC GAP Capital, an unrelated third-party financial institution, for the purchase and sale of future receipts pursuant to which the Company sold in the aggregate $745,000 in future receipts of the Borrowers for gross proceeds of $500,000. The financing arrangement includes issuance costs of $38,500 and has an effective interest rate of 41%. On January 12, 2024, the Company and the following subsidiaries of the Company, Morris Sheet Metal Corp. ("Morris"), JTD Spiral ("JTD"), Morris Enterprises, LLC ("MorrisE"), Morris Transportation LLC ("MorrisT"), and Deluxe Sheet Metal, Inc. ("Deluxe" and together with Morris, JTD, Morris E, and MorrisT, the "Sellers"), entered into an asset purchase agreement (the "Agreement") with Bright-MSM Newco, Inc., an Indiana corporation ("Bright"), relating to the sale by the Company of the assets of the Sellers, and the assumption by Bright of certain liabilities of the Sellers. Pursuant to the Agreement, the Company agreed to sell to Bright and Bright agreed to purchase from the Seller 100% ownership of the assets of the Subsidiaries (the "Assets"), other than certain excluded assets (the "Excluded Assets"). Bright agreed to assume and to discharge certain liabilities of the Sellers (the "Assumed Liabilities") on the terms and subject to the conditions set forth in the Agreement. Pursuant to the Agreement, the consideration paid by Bright for the Assets (the “Purchase Price”) was (a) $1,577,488.97, and (b) the assumption of the Assumed Liabilities. At the closing, Bright agreed to pay off certain obligations of the Sellers, and retained $157,748.90 as a “Holdback Amount (10% of the cash portion of the Purchase Price).” The parties to the Agreement agreed that if there are no claims asserted by Bright under the Agreement within one year of the closing, Bright would pay the Holdback Amount to the Company. On January 15, 2024, in a matter relating to the Company’s subsidiary, Excel Construction Services, LLC (“Excel”), the Company received a complaint filed in the District Court of Twin Falls County, State of Idaho (Case number CV42-24-0190) by Newport Edgewater LLLP (“Newport”), a landlord of a facility rented by Excel, seeking damages from Excel as Tenant and from the Company as guarantor for default on the lease. Newport seeks the total amount owed under the lease over its entire term. On February 29, 2024, a default judgement was entered in the matter against Excel and the Company in an amount of $1,862,391.17, about which the Company is currently contesting before the court the circumstances leading to the default judgement having been issued. Effective February 22, 2024, the Compensation Committee of the Company approved the issuance of new Stock Options to be distributed to the Company's employees and executives with the total amount of Stock Options to be issued to be 3,725,000. Of the 3,725,000 options that were issued, 700,000 options were issued to the Chief Executive Officer, 600,000 options were issued to the Chief Operating Officer, 550,000 options were issued to the VP of Investor Relations, and 300,000 options were issued to the Chief Financial Officer. On March 15, 2024, the Board of Directors (the “Board”) of the Company approved the Company’s plan to wind-down its wholly owned subsidiary Thermal Dynamics International, Inc. (“TDI”) to strengthen the Company’s core business and focus the Company’s resources and equipment on businesses and investments that are more strategic and profitable. The Board’s determination will have no impact on the Company’s other wholly owned subsidiaries. For the twelve months ended December 31, 2023, the Company’s revenues from TDI are expected to be approximately $8.5 million. The Company intends to wind down the operations of TDI over approximately three months, subject to discussions with customers and suppliers of the business. In connection with approval of the plan to exit the business, the Company is expected to incur total non-cash expenses of between $10 million and $12 million, including impairment of intangible assets of approximately $11 million and impairment of a portion of property, plant and equipment of approximately $1 million. Management anticipates that these expenses will be excluded in calculating the Company’s non- GAAP financial performance measures to be reported for 2024. In connection with the wind-down of TDI, the Company also expects to incur other transition costs of approximately $500,000, including advisor fees. On April 12, 2024, in a matter relating to the Company’s prior purchase of Horizon Well Testing, LLC (“HWT”), the Company and HWT were named as third-party defendant in a complaint filed in the District Court of Creek County, State of Oklahoma (Case number CJ-2018-11) by U.S. Energy Devlopment Corporation (“US Energy”), seeking damages associated with liens filed by the original owner of HWT against the property interests of US Energy, who is now seeking unspecified damages greater than $75,000. The Company believes that the prior owner of HWT is personally liable to US Energy for any harm caused to US Energy, and is in communication with US Energy about removing HWT and the Company as named defendants to the lawsuit. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Principles of consolidation | The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries as of September 30, 2023, and December 31, 2022. Significant intercompany balances and transactions have been eliminated. |
Use of estimates | The condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States, or U.S. GAAP. Preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable. This applies in particular to useful lives of long-lived assets, reserves for accounts receivable and inventory, valuation allowance for deferred tax assets, fair values assigned to intangible assets acquired, and impairment of long-lived assets. Actual results could differ significantly from our estimates. To the extent that there are material differences between these estimates and actual results, the Company’s future financial statement presentation, financial condition, results of operations and cash flows will be affected. |
Reclassification | Certain prior year amounts have been reclassified to conform to the current period presentation. These reclassifications had no impact on net earnings and financial position. The following table summarize the effects of the reclassifications on each financial statement line item for the periods indicated. |
Cash | Cash and cash equivalents consist of cash and short-term investments with original maturities of less than 90 days. |
Major Customers & Vendors | The Company had one customer within A4 Technology - RCA segment that made up 10% of total Company accounts receivable as of September 30, 2023. The Company had no customers that made up over 10% of total Company accounts receivable as of December 31, 2022. For the nine months ended September 30, 2023, the Company had no customers that made up over 10% of total Company revenues. For the nine months ended September 30, 2022, the Company had one customer within the A4 Technology - RCA segment that made up 12% of total Company revenues. For the nine months ended September 30, 2023 and 2022, the Company earned 10% and 11%, respectively, of total Company revenues from prime contractors. For the nine months ended September 30, 2023, the Company had no vendors that made up over 10% of total Company purchases. For the nine months ended September 30, 2022, the Company had one vendor within the A4 Technology - RCA segment that made up 14% of total Company purchases. |
Inventory | Inventory for all subsidiaries is valued at weighted average cost. Management compares the cost of inventory with its net realizable value and an allowance is made to write down inventory to net realizable value, if lower. Inventory is segregated into three areas, raw materials, work-in-process and finished goods. |
Goodwill | In financial reporting, goodwill is not amortized, but is tested for impairment annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Events that result in an impairment review include significant changes in the business climate, declines in our operating results, or an expectation that the carrying amount may not be recoverable. We assess potential impairment by considering present economic conditions as well as future expectations. All assessments of goodwill impairment are conducted at the individual reporting unit level. As of September 30, 2023, the reporting units with goodwill were: TDI and RCA. As of December 31, 2022, the reporting units with goodwill were: QCA-W, MSM, Alt Labs, TDI, IDT, Elecjet Corporation ("Elecjet"), and RCA. See Note 3 - Goodwill and Intangible Assets for additional details. |
Impairment of Long-Lived Assets | The Company accounts for long-lived assets in accordance with the provisions of ASC Topic 360, Accounting for the Impairment of Long-Lived Assets. This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when the estimated future cash flows from the use of the asset is less than the carrying amount of that asset. See Note 3 - Goodwill and Intangible Assets for additional details. |
Fair value measurements | Fair value measurements Accounting Standards Codification ("ASC") 820, Fair Value Measurements and Disclosures, 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. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. We apply the provisions of fair value measurement to various nonrecurring measurements for our financial and nonfinancial assets and liabilities. The Company's financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, notes payable and lines of credit. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. We calculate the estimated fair value of a reporting unit using a combination of the income and market approaches. For the income approach, we use DCF models developed in connection with our third-party valuation specialists that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates; and estimated discount rates. For the market approach, we use analyses based primarily on market comparables. We base these assumptions on historical data and experience, industry projections, and general economic conditions. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates. As of September 30, 2023, and December 31, 2022, the Company had no financial assets or liabilities that were required to be fair valued on a recurring basis as all of our financial assets and liabilities were Level 1. |
Research and Development | Research and Development |
Earnings (loss) per share | Loss per share |
Revenue Recognition | The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers ("Topic 606"). The following is a summary of the revenue recognition policy for each of the Company’s subsidiaries. Revenue is recognized under Topic 606, at a point in time and over a period of time, in a manner that reasonably reflects the delivery of its services and products to customers in return for expected consideration and includes the following elements: – executed contract with the Company's customers that it believes are legally enforceable; – identification of performance obligations in the respective contract; – determination of the transaction price for each performance obligation in the respective contract; – allocation of the transaction price to each performance obligation; and – recognition of revenue only when the Company satisfies each performance obligation. QCA and Alt Labs QCA (Circuit boards and cables) and Alt Labs (Supplements) are contract manufacturers and recognize revenue when the products have been built and control has been transferred to the customer. If a deposit for product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. Elecjet Elecjet is a manufacturer of electric components, and a research and development company for battery technology and recognizes revenue when the products have been shipped to the customer. If a deposit for a product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. Identified Technologies Identified Technologies provides 3D mapping drone software and data for industrial job sites and recognizes revenue when the service has been provided to the customer. If a deposit for a product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. Direct Tech Sales (“RCA”) RCA is engaged in the design, manufacture and wholesale distribution of electronics such as televisions, mounting solutions, projectors and screens, audio equipment, digital signage, mobile audio and video systems, and all wire and connecting products throughout the United States of America. RCA recognizes revenue when the products have been shipped to the customer which is also when title transfers. If a deposit for a product or service is received prior to completion, the payment is recorded as deferred revenue until such point the product or services meets our revenue recognition policy. Management assesses the materiality and likelihood of warranty work and returns, and records reserves as needed, and have determined that the warranty and returns would be immaterial for the periods presented. MSM, Excel and TDI For our construction contracts, revenue is generally recognized over time as our performance creates or enhances an asset that the customer controls as it is created or enhanced. Our fixed price construction projects generally use a cost-to-cost input method to measure our progress towards complete satisfaction of the performance obligation as we believe it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. For certain of our revenue streams, that are performed under time and materials contracts, our progress towards complete satisfaction of such performance obligations is measured using an output method as the customer receives and consumes the benefits of our performance completed to date. Due to uncertainties inherent in the estimation process, it is possible that estimates of costs to complete a performance obligation will be revised in the near-term. For those performance obligations for which revenue is recognized using a cost-to-cost input method, changes in total estimated costs, and related progress towards complete satisfaction of the performance obligation, are recognized on a cumulative catch-up basis in the period in which the revisions to the estimates are made. When the current estimate of total costs for a performance obligation indicate a loss, a provision for the entire estimated loss on the unsatisfied performance obligation is made in the period in which the loss becomes evident. Contract Assets and Contract Liabilities The timing of revenue recognition may differ from the timing of invoicing to customers. Contract assets include unbilled amounts from our construction projects when revenues recognized under the cost-to-cost measure of progress exceed the amounts invoiced to our customers, as the amounts cannot be billed under the terms of our contracts. Such amounts are recoverable from our customers based upon various measures of performance, including achievement of certain milestones, completion of specified units or completion of a contract. In addition, many of our time and materials arrangements, are billed pursuant to contract terms that are standard within the industry, resulting in contract assets being recorded, as revenue is recognized in advance of billings. Our contract assets do not include capitalized costs to obtain and fulfill a contract. Contract assets are generally classified as current within the consolidated balance sheets. Contract liabilities from our construction contracts arise when amounts invoiced to our customers exceed revenues recognized under the cost-to-cost measure of progress. Contract liabilities additionally include advanced payments from our customers on certain contracts. Contract liabilities decrease as we recognize revenue from the satisfaction of the related performance obligation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments | Consolidated Statements of Operations for the Three and Nine Months ended September 30, 2022 Three months ended 9/30/22 Nine months ended 9/30/22 Previously Filed Effect of Reclassification Current period presentation Previously Filed Effect of Reclassification Current period presentation Cost of revenue 21,218,317 676,442 21,894,759 60,283,597 1,993,591 62,277,188 Gross Profit 6,268,098 (676,442) 5,591,656 18,066,098 (1,993,591) 16,072,507 General and administrative expenses 10,186,857 (602,822) 9,584,035 28,604,937 (1,956,614) 26,648,323 Research and development 88,960 (62,358) 26,602 675,725 31,556 707,281 Total operating expenses 10,160,117 (665,180) 9,494,937 23,342,512 (1,925,058) 21,417,454 Loss from operations (3,892,019) (11,262) (3,903,281) (5,276,414) (68,533) (5,344,947) Interest expense (1,055,687) 4,448 (1,051,239) (2,627,122) (9,833) (2,636,955) Other income (expense) (12,940) 6,814 (6,126) 278,439 78,366 356,805 Total other income (expenses) (1,068,627) 11,262 (1,057,365) (2,348,683) 68,533 (2,280,150) Net income (loss) $ (4,764,370) $ — $ (4,764,370) $ (7,224,124) $ — $ (7,224,124) |
Schedule of Inventory | Inventory at September 30, 2023, and December 31, 2022, consisted of: September 30, 2023 December 31, 2022 Raw materials $ 9,419,043 $ 9,116,824 Work in process 2,657,123 3,165,876 Finished goods 10,158,312 12,975,669 Inventory $ 22,234,478 $ 25,258,369 |
Schedule of Computation of Basic and Diluted EPS | The following table illustrates the computation of basic and diluted earnings per share (“EPS”) inclusive of all classes of common stock as the only difference between the classes of common stock are related to the voting rights for the Three and nine months ended September 30, 2023 and 2022: For the Three Months Ended September 30, 2023 For the Three Months Ended September 30, 2022 Net Loss Shares Per Share Amount Net Loss Shares Per Share Amount Basic EPS Net loss attributable to common shareholders $ (40,867,608) 27,409,203 $ (1.49) $ (4,764,370) 24,721,070 $ (0.19) Total $ (40,867,608) $ 27,409,203 $ (1.49) $ (4,764,370) $ 24,721,070 $ (0.19) For the Nine Months Ended September 30, 2023 For the Nine Months Ended September 30, 2022 Net Loss Shares Per Share Amount Net Loss Shares Per Share Amount Basic EPS Net loss attributable to common shareholders $ (51,038,858) 25,666,740 $ (1.99) $ (7,224,124) 23,472,306 $ (0.31) Total $ (51,038,858) 25,666,740 $ (1.99) $ (7,224,124) 23,472,306 $ (0.31) |
Disaggregation of Revenue | The following tables present our revenues disaggregated by type for the three months ended September 30, 2023 and 2022: Three Months Ended September 30, 2023 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 10,767,541 $ — $ 8,062,587 $ — $ 18,830,128 Sale of services 4,305,614 — 2,074,058 — 391,004 6,770,676 Total revenues $ 4,305,614 $ 10,767,541 $ 2,074,058 $ 8,062,587 $ 391,004 $ 25,600,804 Three Months Ended September 30, 2022 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 7,354,658 $ — $ 11,581,471 $ — $ 18,936,129 Sale of services 5,097,834 — 3,098,735 — 353,717 8,550,286 Total revenues $ 5,097,834 $ 7,354,658 $ 3,098,735 $ 11,581,471 $ 353,717 $ 27,486,415 The following tables present our revenues disaggregated by type for the nine months ended September 30, 2023 and 2022: Nine Months Ended September 30, 2023 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 32,974,478 $ — $ 24,278,970 $ — $ 57,253,448 Sale of services 12,112,504 — 7,457,508 — 1,161,083 20,731,095 Total revenues $ 12,112,504 $ 32,974,478 $ 7,457,508 $ 24,278,970 $ 1,161,083 $ 77,984,543 Nine Months Ended September 30, 2022 Construction Services Manufacturing Defense Technologies Aerospace Total Sale of goods $ — $ 23,533,228 $ — $ 30,631,117 $ — $ 54,164,345 Sale of services 14,823,297 — 8,258,923 — 1,103,130 24,185,350 Total revenues $ 14,823,297 $ 23,533,228 $ 8,258,923 $ 30,631,117 $ 1,103,130 $ 78,349,695 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Changes in goodwill as of September 30, 2023 were as follows: 2023 Balance as of December 31, 2022 $ 22,680,084 Impairment of goodwill (14,897,570) Balance as of September 30, 2023 $ 7,782,514 |
Schedule of Finite-Lived Intangible Assets | Changes in the carrying amount of intangible assets were as follows: Software Non-compete Customer lists Patents, trademarks, and licenses Proprietary technology Intangible assets, Net Balance as of December 31, 2022 $ 51,390 $ 947,766 $ 11,299,860 $ 6,165,150 $ 17,818,443 $ 36,282,609 Impairment of intangible assets — — (623,179) (5,302,432) (12,482,232) (18,407,843) Amortization expense (51,390) (151,000) (767,058) (432,830) (993,878) (2,396,156) Balance as of September 30, 2023 $ — $ 796,766 $ 9,909,623 $ 429,888 $ 4,342,333 $ 15,478,610 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Finance Lease, Liability, Fiscal Year Maturity | As of September 30, 2023, the future minimum finance and operating lease payments were as follows: Twelve Months Ending September 30, Finance Operating 2024 $ 1,958,956 $ 2,427,879 2025 1,934,916 2,132,342 2026 1,871,566 1,795,302 2027 1,911,880 1,832,680 2028 1,944,907 1,585,379 Thereafter 13,391,240 12,063,124 Total payments 23,013,465 21,836,706 Less: imputed interest (8,192,025) (6,231,797) Total obligation 14,821,440 15,604,909 Less: current portion (800,610) (1,555,872) Non-current lease obligations $ 14,020,830 $ 14,049,037 |
Lessee, Operating Lease, Liability, Maturity | As of September 30, 2023, the future minimum finance and operating lease payments were as follows: Twelve Months Ending September 30, Finance Operating 2024 $ 1,958,956 $ 2,427,879 2025 1,934,916 2,132,342 2026 1,871,566 1,795,302 2027 1,911,880 1,832,680 2028 1,944,907 1,585,379 Thereafter 13,391,240 12,063,124 Total payments 23,013,465 21,836,706 Less: imputed interest (8,192,025) (6,231,797) Total obligation 14,821,440 15,604,909 Less: current portion (800,610) (1,555,872) Non-current lease obligations $ 14,020,830 $ 14,049,037 |
Schedule of Right of Use Assets and Lease Liabilities | The table below presents the operating lease related assets and liabilities recorded on the Company’s condensed consolidated balance sheets as of September 30, 2023, and December 31, 2022: September 30, December 31, Assets Operating lease assets Operating lease right of use assets $ 15,289,327 $ 16,407,566 Total lease assets $ 15,289,327 $ 16,407,566 Liabilities Current liabilities Operating lease liability Current operating lease liability $ 1,555,872 $ 1,318,885 Noncurrent liabilities Operating lease liability Long-term operating lease liability 14,049,037 15,262,494 Total lease liability $ 15,604,909 $ 16,581,379 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | The outstanding balances for the debts as of September 30, 2023, and December 31, 2022, were as follows: September 30, December 31, Lines of credit, current portion $ 11,077,614 $ 7,426,814 Equipment loans, current portion 291,710 68,410 Related party term notes, current portion 638,250 — Term notes, current portion 5,691,565 3,132,726 Total current 17,699,139 10,627,950 Lines of credit, net of current portion 442,962 7,215,520 Notes Payable, net of current portion 3,104,267 4,266,350 Total notes payable and lines of credit $ 21,246,368 $ 22,109,820 |
Schedule of Maturities of Long-term Debt | Future scheduled maturities of outstanding debt are as follows: Twelve Months Ending September 30, 2024 $ 17,699,139 2025 2,748,849 2026 628,474 2027 83,431 2028 17,084 Thereafter 69,391 Total $ 21,246,368 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Share-based Payment Arrangement, Option, Activity | The following table summarizes the stock option activity for the nine months ended September 30, 2023: Options Weighted Weighted Aggregate Outstanding at December 31, 2022 386,751 $ 4.39 7.94 $ 463,495 Granted — — Forfeited (33,248) 6.16 Exercised — — Outstanding at September 30, 2023 353,503 $ 4.22 7.06 $ 36,217 Exercisable at September 30, 2023 158,821 $ 1.85 5.20 $ 36,217 |
Share-based Payment Arrangement, Option, Exercise Price Range | The following table summarizes information about options outstanding and exercisable as of September 30, 2023: Options Outstanding Options Exercisable Exercise Number Weighted Weighted Number Weighted $ 0.40 111,438 4.76 $ 0.40 111,438 $ 0.40 0.80 10,625 4.53 0.80 10,625 0.80 6.16 217,939 8.59 6.16 23,254 6.16 7.20 13,504 3.52 7.20 13,504 7.20 353,506 158,821 |
Schedule of Stockholders' Equity Note, Warrants or Rights | The following table summarizes the warrants activity for the nine months ended September 30, 2023: Warrants Weighted Weighted Aggregate Outstanding at December 31, 2022 2,321,411 $ 11.78 4.31 $ — Granted 203,579 3.51 4.75 Forfeited — — Exercised — — Outstanding at September 30, 2023 2,524,990 $ 11.12 3.62 $ — Exercisable at September 30, 2023 2,524,990 $ 11.12 3.62 $ — |
Schedule of Warrants Outstanding and Exercisable | The following table summarizes information about warrants outstanding and exercisable as of September 30, 2023: Warrants Outstanding Warrants Exercisable Exercise Number Weighted Weighted Number Weighted $ 52.80 52,084 1.39 $ 52.80 52,084 $ 52.80 20.16 49,604 1.20 20.16 49,604 20.16 24.80 535,716 3.16 24.80 535,716 24.80 24.64 53,572 3.15 24.64 53,572 24.64 5.52 1,630,435 3.79 5.52 1,630,435 5.52 3.50 200,000 4.75 3.50 200,000 3.50 4.20 3,579 4.75 4.20 3,579 4.20 2,524,990 2,524,990 |
Fair Value Measurement Inputs and Valuation Techniques | The fair value of the warrants as of September 30, 2023, was $145,000 and $2,595, respectively, and was determined using the following assumptions: Stock price $0.73 Risk-free interest rate 5.50% Expected life of the warrants 4.75 Expected volatility 194% Expected dividend yield 0% |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Revenue A4 Construction Services - MSM $ 3,864,819 $ 4,641,335 $ 11,228,351 $ 13,735,021 A4 Manufacturing - QCA 3,678,052 4,006,665 13,189,382 12,566,907 A4 Manufacturing - Alt Labs 6,394,983 2,707,513 17,409,026 9,490,536 A4 Defense - TDI 2,074,058 3,098,735 7,457,508 8,258,923 A4 Technologies - RCA 7,996,701 11,477,833 23,988,744 29,625,368 A4 Technologies - Elecjet 65,886 103,638 290,226 1,005,749 A4 Aerospace - Vayu — — 4,171 25,000 All Other 1,526,305 1,450,696 4,417,135 3,642,191 $ 25,600,804 $ 27,486,415 $ 77,984,543 $ 78,349,695 Gross profit (loss) A4 Construction Services - MSM $ 198,237 $ 96,339 $ 979,932 $ 487,598 A4 Manufacturing - QCA (396,194) 618,625 2,287,710 2,666,538 A4 Manufacturing - Alt Labs 985,610 317,357 3,713,038 1,478,197 A4 Defense - TDI 221,666 903,845 1,782,798 3,043,644 A4 Technologies - RCA 2,567,450 3,805,942 7,693,654 8,186,193 A4 Technologies - Elecjet (71,284) (192,744) (198,093) (205,976) A4 Aerospace - Vayu — (593) 1,706 (6,064) All Other (142,378) 42,885 105,908 422,377 $ 3,363,107 $ 5,591,656 $ 16,366,653 $ 16,072,507 Income (loss) from operations A4 Construction Services - MSM $ (1,322,422) $ (306,425) $ (1,877,443) $ (760,724) A4 Manufacturing - QCA (3,585,823) (29,101) (3,120,210) 656,151 A4 Manufacturing - Alt Labs (5,526,768) (1,324,793) (5,904,542) 2,806,960 A4 Defense - TDI (263,942) 336,401 746,827 1,543,245 A4 Technologies - RCA 434,845 1,635,201 1,855,395 2,394,868 A4 Technologies - Elecjet (12,210,193) (305,485) (12,677,889) (878,385) A4 Aerospace - Vayu (13,141,251) (916,253) (15,342,234) (2,542,581) All Other (4,713,623) (2,992,826) (12,868,448) (8,564,481) $ (40,329,177) $ (3,903,281) $ (49,188,544) $ (5,344,947) Depreciation and amortization A4 Construction Services - MSM $ 627,209 $ 171,960 $ 980,172 $ 509,706 A4 Manufacturing - QCA 101,384 105,573 331,936 314,356 A4 Manufacturing - Alt Labs 196,194 242,527 630,402 803,510 A4 Defense - TDI 72,433 72,338 217,299 216,518 A4 Technologies - RCA 244,804 270,300 734,413 610,399 A4 Technologies - Elecjet 105,666 103,532 317,000 308,665 A4 Aerospace - Vayu 252,704 258,871 771,294 792,765 All Other (110,916) 346,683 620,101 1,034,321 $ 1,489,478 $ 1,571,784 $ 4,602,617 $ 4,590,240 Interest expense A4 Construction Services - MSM $ 649,599 $ 98,811 $ 861,472 $ 340,337 A4 Manufacturing - QCA 150,785 78,269 485,435 202,159 A4 Manufacturing - Alt Labs 88,449 200,285 238,108 351,962 A4 Defense - TDI (33,945) — — — A4 Technologies - RCA 98,347 103,438 256,199 218,686 A4 Technologies - Elecjet — — — — A4 Aerospace - Vayu (11,372) — — — All Other 254,434 570,436 1,462,698 1,523,811 $ 1,196,297 $ 1,051,239 $ 3,303,912 $ 2,636,955 Net income (loss) A4 Construction Services - MSM $ (1,887,597) $ (403,258) $ (2,616,968) $ (1,042,559) A4 Manufacturing - QCA (3,723,975) (148,902) (3,592,218) 386,728 A4 Manufacturing - Alt Labs (5,646,349) (1,512,864) (6,126,408) 2,673,865 A4 Defense - TDI (229,998) 336,401 771,908 1,543,245 A4 Technologies - RCA 336,498 1,531,763 1,599,196 2,176,182 A4 Technologies - Elecjet (12,210,193) (305,413) (12,677,889) (881,858) A4 Aerospace - Vayu (13,186,179) (916,253) (15,427,910) (2,542,581) All Other (4,408,335) (3,345,844) (13,206,848) (9,537,146) $ (40,956,128) $ (4,764,370) $ (51,277,137) $ (7,224,124) The Company’s reportable segments as of September 30, 2023, and December 31, 2022, were as follows: As of September 30, 2023 As of December 31, 2022 Total assets A4 Construction Services - MSM $ 16,059,629 $ 11,309,049 A4 Manufacturing - QCA 16,489,038 20,988,492 A4 Manufacturing - Alt Labs 23,545,683 26,636,905 A4 Defense - TDI 12,569,449 13,497,381 A4 Technologies - RCA 23,791,454 27,191,977 A4 Technologies - Elecjet 548,406 12,897,440 A4 Aerospace - Vayu 1,651,865 14,632,530 All Other 9,844,682 18,478,440 $ 104,500,206 $ 145,632,214 Goodwill A4 Construction Services - MSM $ — $ 113,592 A4 Manufacturing - QCA — 1,963,761 A4 Manufacturing - Alt Labs — 4,410,564 A4 Defense - TDI 6,426,786 6,426,786 A4 Technologies - RCA 1,355,728 1,355,728 A4 Technologies - Elecjet — 6,496,343 A4 Aerospace - Vayu — — All Other — 1,913,310 $ 7,782,514 $ 22,680,084 Accounts receivable, net A4 Construction Services - MSM $ 4,487,235 $ 5,188,521 A4 Manufacturing - QCA 2,634,122 3,867,141 A4 Manufacturing - Alt Labs 2,379,169 1,833,502 A4 Defense - TDI 1,131,434 1,905,314 A4 Technologies - RCA 3,870,943 3,232,559 A4 Technologies - Elecjet 1,257 12,888 A4 Aerospace - Vayu 500,000 — All Other 1,064,533 1,100,019 $ 16,068,693 $ 17,139,944 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Goodwill impairment losses | $ 14,897,570 | $ 0 | $ 14,897,570 | $ 0 |
Intangible asset impairment losses | $ 18,407,843 | $ 0 | $ 18,407,843 | $ 0 |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Schedule of Investments [Line Items] | |||||
Net loss | $ 40,956,128 | $ 4,764,370 | $ 51,277,137 | $ 7,224,124 | |
Net cash provided by (used in) operating activities | 2,080,081 | $ (17,712,972) | |||
Working capital | (7,200,000) | (7,200,000) | |||
Decrease in working capital | 22,800,000 | ||||
Lines of credit, current portion | 34,000,000 | 34,000,000 | |||
Lines of credit, current portion | 11,077,614 | 11,077,614 | $ 7,426,814 | ||
Revolving Credit Facility | Line of Credit | |||||
Schedule of Investments [Line Items] | |||||
Maximum borrowing capacity | 35,000,000 | 35,000,000 | |||
Remaining borrowing capacity | 3,100,000 | 3,100,000 | |||
Revolving Credit Facility | Four Revolving Lines of Credit | Line of Credit | |||||
Schedule of Investments [Line Items] | |||||
Maximum borrowing capacity | 35,000,000 | 35,000,000 | |||
Revolving Credit Facility | Capital Expenditure Line of Credit | Line of Credit | |||||
Schedule of Investments [Line Items] | |||||
Maximum borrowing capacity | $ 400,000 | $ 400,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Statements of Operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||||||||
Sep. 30, 2023 | Jun. 30, 2023 | [1] | Mar. 31, 2023 | [1] | Sep. 30, 2022 | Jun. 30, 2022 | [1] | Mar. 31, 2022 | [1] | Sep. 30, 2023 | Sep. 30, 2022 | |||
Condensed Financial Statements, Captions [Line Items] | ||||||||||||||
Cost of revenues | $ 22,237,697 | $ 21,894,759 | $ 61,617,890 | $ 62,277,188 | ||||||||||
Gross profit (loss) | 3,363,107 | 5,591,656 | 16,366,653 | 16,072,507 | ||||||||||
General and administrative expenses | 8,974,652 | 9,584,035 | 29,111,129 | 26,648,323 | ||||||||||
Research and development | 1,412,219 | 26,602 | 3,138,655 | 707,281 | ||||||||||
Operating Expenses | 43,692,284 | 9,494,937 | 65,555,197 | 21,417,454 | ||||||||||
Income (loss) from operations | (40,329,177) | (3,903,281) | (49,188,544) | (5,344,947) | ||||||||||
Interest Expense | (1,196,297) | (1,051,239) | (3,303,912) | (2,636,955) | ||||||||||
Other income (expense) | (36,510) | (6,126) | 22,596 | 356,805 | ||||||||||
Total other income (expenses) | (742,495) | (1,057,365) | (2,791,004) | (2,280,150) | ||||||||||
Net loss | $ (40,867,608) | [1] | $ (4,551,866) | $ (5,769,143) | (4,764,370) | [1] | $ 1,539,806 | $ (3,999,560) | $ (51,038,858) | (7,224,124) | ||||
Previously Filed | ||||||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||||||
Cost of revenues | 21,218,317 | 60,283,597 | ||||||||||||
Gross profit (loss) | 6,268,098 | 18,066,098 | ||||||||||||
General and administrative expenses | 10,186,857 | 28,604,937 | ||||||||||||
Research and development | 88,960 | 675,725 | ||||||||||||
Operating Expenses | 10,160,117 | 23,342,512 | ||||||||||||
Income (loss) from operations | (3,892,019) | (5,276,414) | ||||||||||||
Interest Expense | (1,055,687) | (2,627,122) | ||||||||||||
Other income (expense) | (12,940) | 278,439 | ||||||||||||
Total other income (expenses) | (1,068,627) | (2,348,683) | ||||||||||||
Net loss | (4,764,370) | (7,224,124) | ||||||||||||
Effect of Reclassification | ||||||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||||||
Cost of revenues | 676,442 | 1,993,591 | ||||||||||||
Gross profit (loss) | (676,442) | (1,993,591) | ||||||||||||
General and administrative expenses | (602,822) | (1,956,614) | ||||||||||||
Research and development | (62,358) | 31,556 | ||||||||||||
Operating Expenses | (665,180) | (1,925,058) | ||||||||||||
Income (loss) from operations | (11,262) | (68,533) | ||||||||||||
Interest Expense | 4,448 | (9,833) | ||||||||||||
Other income (expense) | 6,814 | 78,366 | ||||||||||||
Total other income (expenses) | 11,262 | 68,533 | ||||||||||||
Net loss | $ 0 | $ 0 | ||||||||||||
[1]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details. |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Cash (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Cash equivalents | $ 0 | $ 0 |
Uninsured cash | $ 2,300,000 | $ 2,000,000 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Major Customers & Vendors (Details) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue | Customer Concentration Risk | Customer One | ||
Product Information [Line Items] | ||
Concentration risk, percentage | 12% | |
Revenue | Customer Concentration Risk | Prime Contractors | ||
Product Information [Line Items] | ||
Concentration risk, percentage | 10% | 11% |
Cost of Goods and Service | Vendor Concentration Risk | A4 Technologies - RCA Segment | ||
Product Information [Line Items] | ||
Concentration risk, percentage | 14% | |
Accounts Receivable | Customer Concentration Risk | Customer One | ||
Product Information [Line Items] | ||
Concentration risk, percentage | 10% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Inventory (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Raw materials | $ 9,419,043 | $ 9,116,824 |
Work in process | 2,657,123 | 3,165,876 |
Finished goods | 10,158,312 | 12,975,669 |
Inventory | $ 22,234,478 | $ 25,258,369 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Research and Development (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accounting Policies [Abstract] | ||||
Research and development | $ 1,412,219 | $ 26,602 | $ 3,138,655 | $ 707,281 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | ||
Accounting Policies [Abstract] | |||||
Antidilutive securities (in shares) | 2,878,496 | 2,725,270 | |||
Basic EPS | |||||
Net loss attributable to common shareholders | $ (40,867,608) | $ (4,764,370) | $ (51,038,858) | $ (7,224,124) | |
Net loss (in shares) | [1] | 27,409,203 | 24,721,070 | 25,666,740 | 23,472,306 |
Net loss (in dollars per share) | $ (1.49) | $ (0.19) | $ (1.99) | $ (0.31) | |
Diluted EPS | |||||
Net Loss | $ (40,867,608) | $ (4,764,370) | $ (51,038,858) | $ (7,224,124) | |
Net loss (in shares) | [1] | 27,409,203 | 24,721,070 | 25,666,740 | 23,472,306 |
Net loss (in dollars per share) | $ (1.49) | $ (0.19) | $ (1.99) | $ (0.31) | |
[1]Current and prior period results have been adjusted to reflect the one-for-eight stock split effected in May 2023. See Note 7, Stockholders' Equity for details. |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Schedule of 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 revenues | $ 25,600,804 | $ 27,486,415 | $ 77,984,543 | $ 78,349,695 |
Construction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 4,305,614 | 5,097,834 | 12,112,504 | 14,823,297 |
Manufacturing | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 10,767,541 | 7,354,658 | 32,974,478 | 23,533,228 |
Defense | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 2,074,058 | 3,098,735 | 7,457,508 | 8,258,923 |
Technologies | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 8,062,587 | 11,581,471 | 24,278,970 | 30,631,117 |
Aerospace | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 391,004 | 353,717 | 1,161,083 | 1,103,130 |
Sale of goods | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 18,830,128 | 18,936,129 | 57,253,448 | 54,164,345 |
Sale of goods | Construction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 0 | 0 | 0 | 0 |
Sale of goods | Manufacturing | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 10,767,541 | 7,354,658 | 32,974,478 | 23,533,228 |
Sale of goods | Defense | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 0 | 0 | 0 | 0 |
Sale of goods | Technologies | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 8,062,587 | 11,581,471 | 24,278,970 | 30,631,117 |
Sale of goods | Aerospace | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 0 | 0 | 0 | 0 |
Sale of services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 6,770,676 | 8,550,286 | 20,731,095 | 24,185,350 |
Sale of services | Construction Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 4,305,614 | 5,097,834 | 12,112,504 | 14,823,297 |
Sale of services | Manufacturing | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 0 | 0 | 0 | 0 |
Sale of services | Defense | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 2,074,058 | 3,098,735 | 7,457,508 | 8,258,923 |
Sale of services | Technologies | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 0 | 0 | 0 | 0 |
Sale of services | Aerospace | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 391,004 | $ 353,717 | $ 1,161,083 | $ 1,103,130 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Goodwill [Line Items] | |||||
Goodwill impairment losses | $ 14,897,570 | $ 0 | $ 14,897,570 | $ 0 | |
Goodwill | 7,782,514 | 7,782,514 | $ 22,680,084 | ||
Amortization expense | $ 800,000 | $ 800,000 | 2,396,156 | $ 2,300,000 | |
Impairment of Intangible Assets, Finite-Lived | $ 18,407,843 | ||||
TDI | |||||
Goodwill [Line Items] | |||||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 10% | 10% | |||
RCA | |||||
Goodwill [Line Items] | |||||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 10% | 10% |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Goodwill Rollforward (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill [Roll Forward] | ||||
Balance as of December 31, 2022 | $ 22,680,084 | |||
Goodwill impairment losses | $ (14,897,570) | $ 0 | (14,897,570) | $ 0 |
Balance as of September 30, 2023 | $ 7,782,514 | $ 7,782,514 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible Assets Rollforward (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Finite-Lived Intangible Assets [Roll Forward] | ||||
Balance as of December 31, 2022 | $ 36,282,609 | |||
Impairment of intangible assets | (18,407,843) | |||
Amortization expense | $ (800,000) | $ (800,000) | (2,396,156) | $ (2,300,000) |
Balance as of September 30, 2023 | 15,478,610 | 15,478,610 | ||
Software | ||||
Finite-Lived Intangible Assets [Roll Forward] | ||||
Balance as of December 31, 2022 | 51,390 | |||
Impairment of intangible assets | 0 | |||
Amortization expense | (51,390) | |||
Balance as of September 30, 2023 | 0 | 0 | ||
Non-compete | ||||
Finite-Lived Intangible Assets [Roll Forward] | ||||
Balance as of December 31, 2022 | 947,766 | |||
Impairment of intangible assets | 0 | |||
Amortization expense | (151,000) | |||
Balance as of September 30, 2023 | 796,766 | 796,766 | ||
Customer lists | ||||
Finite-Lived Intangible Assets [Roll Forward] | ||||
Balance as of December 31, 2022 | 11,299,860 | |||
Impairment of intangible assets | (623,179) | |||
Amortization expense | (767,058) | |||
Balance as of September 30, 2023 | 9,909,623 | 9,909,623 | ||
Patents, trademarks, and licenses | ||||
Finite-Lived Intangible Assets [Roll Forward] | ||||
Balance as of December 31, 2022 | 6,165,150 | |||
Impairment of intangible assets | (5,302,432) | |||
Amortization expense | (432,830) | |||
Balance as of September 30, 2023 | 429,888 | 429,888 | ||
Proprietary technology | ||||
Finite-Lived Intangible Assets [Roll Forward] | ||||
Balance as of December 31, 2022 | 17,818,443 | |||
Impairment of intangible assets | (12,482,232) | |||
Amortization expense | (993,878) | |||
Balance as of September 30, 2023 | $ 4,342,333 | $ 4,342,333 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Finance Leases | ||
2024 | $ 1,958,956 | |
2025 | 1,934,916 | |
2026 | 1,871,566 | |
2027 | 1,911,880 | |
2028 | 1,944,907 | |
Thereafter | 13,391,240 | |
Total payments | 23,013,465 | |
Less: imputed interest | (8,192,025) | |
Total obligation | 14,821,440 | |
Less: current portion | (800,610) | $ (725,302) |
Non-current lease obligations | 14,020,830 | 14,592,813 |
Operating Leases | ||
2024 | 2,427,879 | |
2025 | 2,132,342 | |
2026 | 1,795,302 | |
2027 | 1,832,680 | |
2028 | 1,585,379 | |
Thereafter | 12,063,124 | |
Total payments | 21,836,706 | |
Less: imputed interest | (6,231,797) | |
Total lease liability | 15,604,909 | 16,581,379 |
Less: current portion | (1,555,872) | (1,318,885) |
Non-current lease obligations | $ 14,049,037 | $ 15,262,494 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Finance Leases | ||
Finance lease, right-of-use asset, amortization | $ 938,863 | $ 938,863 |
Finance lease, interest expense | $ 907,063 | 946,241 |
Finance lease, weighted average remaining lease term | 11 years 2 months 12 days | |
Finance lease, weighted average discount rate (as a percent) | 8.01% | |
Operating Leases | ||
Operating lease, cost | $ 1,938,803 | 519,818 |
Operating lease, payments | $ 1,172,383 | 645,065 |
Operating lease, weighted average remaining lease term | 11 years 3 months 18 days | |
Operating lease, weighted average discount rate (as a percent) | 6.02% | |
Cost of Sales | ||
Finance Leases | ||
Finance lease, right-of-use asset, amortization | $ 133,508 | 0 |
Operating Leases | ||
Operating lease, cost | $ 404,993 | $ 0 |
Leases - Schedule of Right of U
Leases - Schedule of Right of Use Assets and Lease Liabilities (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Assets | ||
Operating lease assets | $ 15,289,327 | $ 16,407,566 |
Liabilities | ||
Current operating lease liability | 1,555,872 | 1,318,885 |
Long-term operating lease liability | 14,049,037 | 15,262,494 |
Total lease liability | $ 15,604,909 | $ 16,581,379 |
Debt - Schedule of Notes Payabl
Debt - Schedule of Notes Payable (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Total current | $ 17,699,139 | $ 10,627,950 |
Total | 21,246,368 | 22,109,820 |
Line of Credit | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Total current | 11,077,614 | 7,426,814 |
Long-term debt | 442,962 | 7,215,520 |
Equipment loans, current portion | ||
Debt Instrument [Line Items] | ||
Total current | 291,710 | 68,410 |
Related party term notes, current portion | ||
Debt Instrument [Line Items] | ||
Total current | 638,250 | 0 |
Term notes, current portion | ||
Debt Instrument [Line Items] | ||
Total current | 5,691,565 | 3,132,726 |
Notes Payable, net of current portion | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 3,104,267 | $ 4,266,350 |
Debt - Future Scheduled Maturit
Debt - Future Scheduled Maturities of Outstanding Notes Payable (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
2024 | $ 17,699,139 | |
2025 | 2,748,849 | |
2026 | 628,474 | |
2027 | 83,431 | |
2028 | 17,084 | |
Thereafter | 69,391 | |
Total | $ 21,246,368 | $ 22,109,820 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 9 Months Ended | |||
Sep. 29, 2023 USD ($) | Sep. 30, 2023 USD ($) lineOfCredit | Jul. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||
Note balance | $ 21,246,368 | $ 22,109,820 | ||
Asset Pledged as Collateral | ||||
Debt Instrument [Line Items] | ||||
Cash | $ 2,982,000 | |||
Standard Merchant Cash Advance Agreement | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, face amount | 2,100,000 | |||
Issuance costs | 100,000 | |||
Monthly payments | $ 93,000 | |||
Interest rate, effective percentage | 42% | |||
Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 35,000,000 | |||
Number of lines of credit | lineOfCredit | 5 | |||
Proceeds from lines of credit | $ 11,500,000 | |||
Remaining borrowing capacity | 3,100,000 | |||
Line of Credit | Revolving Credit Facility | Capital Expenditure Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 400,000 | |||
Number of lines of credit | lineOfCredit | 1 | |||
Line of Credit | Minimum | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Debt instrument term | 1 year | |||
Line of Credit | Minimum | Revolving Credit Facility | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate (as a percent) | 2.50% | |||
Line of Credit | Maximum | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Debt instrument term | 5 years | |||
Line of Credit | Maximum | Revolving Credit Facility | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate (as a percent) | 4.25% | |||
Alan Martin | Term notes, current portion | ||||
Debt Instrument [Line Items] | ||||
Note balance | $ 2,900,000 | |||
Interest payable, current | $ 2,000,000 |
Convertible Debt (Details)
Convertible Debt (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Jun. 30, 2023 | May 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||||
Net proceeds from issuance of convertible notes, non-related party | $ 243,529 | $ 1,964,000 | $ 0 | |
Convertible Note Payable 1 | ||||
Debt Instrument [Line Items] | ||||
Convertible debt | 126,482 | |||
Convertible Note Payable 2 | ||||
Debt Instrument [Line Items] | ||||
Convertible debt | $ 869,046 | |||
Restricted Stock | ||||
Debt Instrument [Line Items] | ||||
Shares granted (in shares) | 67,400 | 13,750 | ||
Convertible Notes Payable | ||||
Debt Instrument [Line Items] | ||||
Debt instrument term | 1 year | 1 year | ||
Debt instrument, face amount | $ 1,700,000 | $ 400,000 | ||
Interest rate (as a percent) | 12% | 12% | ||
Original issue discount | $ 242,120 | $ 24,500 | ||
Net proceeds from issuance of convertible notes, non-related party | $ 757,280 | |||
Convertible Notes Payable | Warrants 2 | ||||
Debt Instrument [Line Items] | ||||
Warrants outstanding | 3,579 | |||
Fair value of warrants issued | $ 6,764 | |||
Convertible Notes Payable | Warrants 1 | ||||
Debt Instrument [Line Items] | ||||
Warrants outstanding | 200,000 | |||
Fair value of warrants issued | $ 378,000 | |||
Convertible Notes Payable | Restricted Stock | ||||
Debt Instrument [Line Items] | ||||
Shares granted (in shares) | 1,200,000 | 196,250 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) | 1 Months Ended | 9 Months Ended | |||||||
Aug. 03, 2023 | Sep. 30, 2023 | Aug. 31, 2023 | Jul. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | May 12, 2023 | May 11, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Issuance of shares of common stock for compensation (in shares) | 80,000 | ||||||||
Shares Issued, Price Per Share | $ 1.25 | ||||||||
Stock compensation expense | $ 373,786 | $ 520,416 | |||||||
Share-based compensation expense not yet recognized, options | $ 700,000 | 700,000 | |||||||
Warrants Not Settleable in Cash, Fair Value Disclosure | $ 145,000 | 145,000 | $ 2,595 | ||||||
Stock options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock compensation expense | $ 300,000 | $ 100,000 | |||||||
Horizon Well Testing Case | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares settled (in shares) | 250,000 | 250,000 | |||||||
Shares Issued, Price Per Share | $ 1.99 | ||||||||
Class C Common Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock, shares authorized (in shares) | 15,000,000 | 15,000,000 | 15,000,000 | ||||||
Common stock, shares outstanding (in shares) | 1,501,840 | 1,501,840 | 1,529,888 | ||||||
Common stock, shares issued (in shares) | 1,501,840 | 1,501,840 | 1,529,888 | ||||||
Stock converted (in shares) | 26,749 | ||||||||
Class A Common Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 | 200,000,000 | 295,000,000 | 200,000,000 | ||||
Common stock, shares outstanding (in shares) | 24,331,406 | 24,331,406 | 22,504,669 | 180,037,350 | 22,303,333 | ||||
Common stock, shares issued (in shares) | 24,331,406 | 24,331,406 | 22,504,669 | 180,037,350 | 22,303,333 | ||||
Conversion of stock, shares issued (in shares) | 26,749 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Options | ||
Outstanding, beginning balance (in shares) | 386,751 | |
Granted (in shares) | 0 | |
Forfeited (in shares) | (33,248) | |
Exercised (in shares) | 0 | |
Outstanding, ending balance (in shares) | 353,503 | 386,751 |
Exercisable (in shares) | 158,821 | |
Weighted Average Exercise Price | ||
Outstanding, beginning balance (in dollars per share) | $ 4.39 | |
Granted (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 6.16 | |
Exercised (in dollars per share) | 0 | |
Outstanding, ending balance (in dollars per share) | 4.22 | $ 4.39 |
Exercisable (in dollars per share) | $ 1.85 | |
Weighted Average Remaining Contractual Life (Years) | ||
Outstanding | 7 years 21 days | 7 years 11 months 8 days |
Exercisable | 5 years 2 months 12 days | |
Aggregate Intrinsic Value | ||
Outstanding | $ 36,217 | $ 463,495 |
Exercisable | $ 36,217 |
Stockholders' Equity - Options
Stockholders' Equity - Options Outstanding and Exercisable (Details) | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Options Outstanding | |
Number of Shares (in shares) | shares | 353,506 |
Options Exercisable | |
Number of Shares (in shares) | shares | 158,821 |
Exercise Price $0.40 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price (in dollars per share) | $ 0.40 |
Exercise price (in dollars per share) | $ 0.40 |
Options Outstanding | |
Number of Shares (in shares) | shares | 111,438 |
Weighted Average Remaining Life (Years) | 4 years 9 months 3 days |
Weighted Average Exercise Price (in dollars per share) | $ 0.40 |
Options Exercisable | |
Number of Shares (in shares) | shares | 111,438 |
Weighted Average Exercise Price (in dollars per share) | $ 0.40 |
Exercise Price $0.80 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price (in dollars per share) | 0.80 |
Exercise price (in dollars per share) | $ 0.80 |
Options Outstanding | |
Number of Shares (in shares) | shares | 10,625 |
Weighted Average Remaining Life (Years) | 4 years 6 months 10 days |
Weighted Average Exercise Price (in dollars per share) | $ 0.80 |
Options Exercisable | |
Number of Shares (in shares) | shares | 10,625 |
Weighted Average Exercise Price (in dollars per share) | $ 0.80 |
Exercise Price $6.16 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price (in dollars per share) | 6.16 |
Exercise price (in dollars per share) | $ 6.16 |
Options Outstanding | |
Number of Shares (in shares) | shares | 217,939 |
Weighted Average Remaining Life (Years) | 8 years 7 months 2 days |
Weighted Average Exercise Price (in dollars per share) | $ 6.16 |
Options Exercisable | |
Number of Shares (in shares) | shares | 23,254 |
Weighted Average Exercise Price (in dollars per share) | $ 6.16 |
Exercise Price $7.20 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price (in dollars per share) | 7.20 |
Exercise price (in dollars per share) | $ 7.20 |
Options Outstanding | |
Number of Shares (in shares) | shares | 13,504 |
Weighted Average Remaining Life (Years) | 3 years 6 months 7 days |
Weighted Average Exercise Price (in dollars per share) | $ 7.20 |
Options Exercisable | |
Number of Shares (in shares) | shares | 13,504 |
Weighted Average Exercise Price (in dollars per share) | $ 7.20 |
Stockholders' Equity - Warrants
Stockholders' Equity - Warrants Activity (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Warrants | ||
Outstanding, beginning balance (in shares) | 386,751 | |
Granted (in shares) | 0 | |
Forfeited (in shares) | (33,248) | |
Exercised (in shares) | 0 | |
Outstanding, ending balance (in shares) | 353,503 | 386,751 |
Exercisable (in shares) | 158,821 | |
Weighted Average Exercise Price | ||
Outstanding, beginning balance (in dollars per share) | $ 4.39 | |
Granted (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 6.16 | |
Exercised (in dollars per share) | 0 | |
Outstanding, ending balance (in dollars per share) | 4.22 | $ 4.39 |
Exercisable (in dollars per share) | $ 1.85 | |
Weighted Average Remaining Contractual Life (Years) | ||
Outstanding | 7 years 21 days | 7 years 11 months 8 days |
Exercisable | 5 years 2 months 12 days | |
Aggregate Intrinsic Value | ||
Outstanding | $ 36,217 | $ 463,495 |
Exercisable | $ 36,217 | |
Warrant | ||
Warrants | ||
Outstanding, beginning balance (in shares) | 2,321,411 | |
Granted (in shares) | 203,579 | |
Forfeited (in shares) | 0 | |
Exercised (in shares) | 0 | |
Outstanding, ending balance (in shares) | 2,524,990 | 2,321,411 |
Exercisable (in shares) | 2,524,990 | |
Weighted Average Exercise Price | ||
Outstanding, beginning balance (in dollars per share) | $ 11.78 | |
Granted (in dollars per share) | 3.51 | |
Forfeited (in dollars per share) | 0 | |
Exercised (in dollars per share) | 0 | |
Outstanding, ending balance (in dollars per share) | 11.12 | $ 11.78 |
Exercisable (in dollars per share) | $ 11.12 | |
Weighted Average Remaining Contractual Life (Years) | ||
Outstanding | 3 years 7 months 13 days | 4 years 3 months 21 days |
Granted | 4 years 9 months | |
Exercisable | 3 years 7 months 13 days | |
Aggregate Intrinsic Value | ||
Outstanding | $ 0 | $ 0 |
Exercisable | $ 0 |
Stockholders' Equity - Warran_2
Stockholders' Equity - Warrants Outstanding and Exercisable (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Number of Shares outstanding (in shares) | 353,503 | 386,751 |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 7 years 21 days | 7 years 11 months 8 days |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 4.22 | $ 4.39 |
Warrants Exercisable, Number of Shares (in shares) | 158,821 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 1.85 | |
Warrants 1 | Convertible Notes Payable | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants outstanding | 200,000 | |
Warrant exercise price (in dollar per share) | $ 3.50 | |
Fair value of warrants issued | $ 378,000 | |
Warrants 2 | Convertible Notes Payable | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants outstanding | 3,579 | |
Warrant exercise price (in dollar per share) | $ 4.20 | |
Fair value of warrants issued | $ 6,764 | |
Warrant | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Number of Shares outstanding (in shares) | 2,524,990 | 2,321,411 |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 3 years 7 months 13 days | 4 years 3 months 21 days |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 11.12 | $ 11.78 |
Warrants Exercisable, Number of Shares (in shares) | 2,524,990 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 11.12 | |
Warrant | Exercise price $52.80 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 52.80 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 52,084 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 1 year 4 months 20 days | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 52.80 | |
Warrants Exercisable, Number of Shares (in shares) | 52,084 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 52.80 | |
Warrant | Exercise price $20.16 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 20.16 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 49,604 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 1 year 2 months 12 days | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 20.16 | |
Warrants Exercisable, Number of Shares (in shares) | 49,604 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 20.16 | |
Warrant | Exercise price $24.80 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 24.80 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 535,716 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 3 years 1 month 28 days | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 24.80 | |
Warrants Exercisable, Number of Shares (in shares) | 535,716 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 24.80 | |
Warrant | Exercise price $24.64 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 24.64 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 53,572 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 3 years 1 month 24 days | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 24.64 | |
Warrants Exercisable, Number of Shares (in shares) | 53,572 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 24.64 | |
Warrant | Exercise price $5.52 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 5.52 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 1,630,435 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 3 years 9 months 14 days | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 5.52 | |
Warrants Exercisable, Number of Shares (in shares) | 1,630,435 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 5.52 | |
Warrant | Exercise price $3.50 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 3.50 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 200,000 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 4 years 9 months | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 3.50 | |
Warrants Exercisable, Number of Shares (in shares) | 200,000 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 3.50 | |
Warrant | Exercise price $4.20 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants Outstanding, Exercise Price (in dollars per share) | $ 4.20 | |
Warrants Outstanding, Number of Shares outstanding (in shares) | 3,579 | |
Warrants Outstanding, Weighted Average Remaining Life (Years) | 4 years 9 months | |
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 4.20 | |
Warrants Exercisable, Number of Shares (in shares) | 3,579 | |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 4.20 |
Stockholders' Equity - Valuatio
Stockholders' Equity - Valuation Assumptions (Details) | Sep. 30, 2023 |
Stock price | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding, measurement input | 0.73 |
Risk-free interest rate | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding, measurement input | 5.5 |
Expected life of the warrants | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding, measurement input | 4.75 |
Expected volatility | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding, measurement input | 194 |
Expected dividend yield | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding, measurement input | 0 |
Segment Reporting (Details)
Segment Reporting (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 [Abstract] | |||||
Number of operating segments | segment | 7 | ||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | $ 25,600,804 | $ 27,486,415 | $ 77,984,543 | $ 78,349,695 | |
Gross profit (loss) | 3,363,107 | 5,591,656 | 16,366,653 | 16,072,507 | |
Income (loss) from operations | (40,329,177) | (3,903,281) | (49,188,544) | (5,344,947) | |
Depreciation and amortization | 1,489,478 | 1,571,784 | 4,602,617 | 4,590,240 | |
Interest expense | 1,196,297 | 1,051,239 | 3,303,912 | 2,636,955 | |
Net income (loss) | (40,956,128) | (4,764,370) | (51,277,137) | (7,224,124) | |
Total assets | 104,500,206 | 104,500,206 | $ 145,632,214 | ||
Goodwill | 7,782,514 | 7,782,514 | 22,680,084 | ||
Accounts receivable, net | 16,068,693 | 16,068,693 | 17,139,944 | ||
All Other | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 1,526,305 | 1,450,696 | 4,417,135 | 3,642,191 | |
Gross profit (loss) | (142,378) | 42,885 | 105,908 | 422,377 | |
Income (loss) from operations | (4,713,623) | (2,992,826) | (12,868,448) | (8,564,481) | |
Depreciation and amortization | (110,916) | 346,683 | 620,101 | 1,034,321 | |
Interest expense | 254,434 | 570,436 | 1,462,698 | 1,523,811 | |
Net income (loss) | (4,408,335) | (3,345,844) | (13,206,848) | (9,537,146) | |
Total assets | 9,844,682 | 9,844,682 | 18,478,440 | ||
Goodwill | 0 | 0 | 1,913,310 | ||
Accounts receivable, net | 1,064,533 | 1,064,533 | 1,100,019 | ||
A4 Construction Services - MSM Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 3,864,819 | 4,641,335 | 11,228,351 | 13,735,021 | |
Gross profit (loss) | 198,237 | 96,339 | 979,932 | 487,598 | |
Income (loss) from operations | (1,322,422) | (306,425) | (1,877,443) | (760,724) | |
Depreciation and amortization | 627,209 | 171,960 | 980,172 | 509,706 | |
Interest expense | 649,599 | 98,811 | 861,472 | 340,337 | |
Net income (loss) | (1,887,597) | (403,258) | (2,616,968) | (1,042,559) | |
Total assets | 16,059,629 | 16,059,629 | 11,309,049 | ||
Goodwill | 0 | 0 | 113,592 | ||
Accounts receivable, net | 4,487,235 | 4,487,235 | 5,188,521 | ||
A4 Manufacturing - QCA Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 3,678,052 | 4,006,665 | 13,189,382 | 12,566,907 | |
Gross profit (loss) | (396,194) | 618,625 | 2,287,710 | 2,666,538 | |
Income (loss) from operations | (3,585,823) | (29,101) | (3,120,210) | 656,151 | |
Depreciation and amortization | 101,384 | 105,573 | 331,936 | 314,356 | |
Interest expense | 150,785 | 78,269 | 485,435 | 202,159 | |
Net income (loss) | (3,723,975) | (148,902) | (3,592,218) | 386,728 | |
Total assets | 16,489,038 | 16,489,038 | 20,988,492 | ||
Goodwill | 0 | 0 | 1,963,761 | ||
Accounts receivable, net | 2,634,122 | 2,634,122 | 3,867,141 | ||
A4 Manufacturing - Alt Labs Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 6,394,983 | 2,707,513 | 17,409,026 | 9,490,536 | |
Gross profit (loss) | 985,610 | 317,357 | 3,713,038 | 1,478,197 | |
Income (loss) from operations | (5,526,768) | (1,324,793) | (5,904,542) | 2,806,960 | |
Depreciation and amortization | 196,194 | 242,527 | 630,402 | 803,510 | |
Interest expense | 88,449 | 200,285 | 238,108 | 351,962 | |
Net income (loss) | (5,646,349) | (1,512,864) | (6,126,408) | 2,673,865 | |
Total assets | 23,545,683 | 23,545,683 | 26,636,905 | ||
Goodwill | 0 | 0 | 4,410,564 | ||
Accounts receivable, net | 2,379,169 | 2,379,169 | 1,833,502 | ||
A4 Defense - TDI Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 2,074,058 | 3,098,735 | 7,457,508 | 8,258,923 | |
Gross profit (loss) | 221,666 | 903,845 | 1,782,798 | 3,043,644 | |
Income (loss) from operations | (263,942) | 336,401 | 746,827 | 1,543,245 | |
Depreciation and amortization | 72,433 | 72,338 | 217,299 | 216,518 | |
Interest expense | (33,945) | 0 | 0 | 0 | |
Net income (loss) | (229,998) | 336,401 | 771,908 | 1,543,245 | |
Total assets | 12,569,449 | 12,569,449 | 13,497,381 | ||
Goodwill | 6,426,786 | 6,426,786 | 6,426,786 | ||
Accounts receivable, net | 1,131,434 | 1,131,434 | 1,905,314 | ||
A4 Technologies - RCA Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 7,996,701 | 11,477,833 | 23,988,744 | 29,625,368 | |
Gross profit (loss) | 2,567,450 | 3,805,942 | 7,693,654 | 8,186,193 | |
Income (loss) from operations | 434,845 | 1,635,201 | 1,855,395 | 2,394,868 | |
Depreciation and amortization | 244,804 | 270,300 | 734,413 | 610,399 | |
Interest expense | 98,347 | 103,438 | 256,199 | 218,686 | |
Net income (loss) | 336,498 | 1,531,763 | 1,599,196 | 2,176,182 | |
Total assets | 23,791,454 | 23,791,454 | 27,191,977 | ||
Goodwill | 1,355,728 | 1,355,728 | 1,355,728 | ||
Accounts receivable, net | 3,870,943 | 3,870,943 | 3,232,559 | ||
A4 Technologies - Elecjet Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 65,886 | 103,638 | 290,226 | 1,005,749 | |
Gross profit (loss) | (71,284) | (192,744) | (198,093) | (205,976) | |
Income (loss) from operations | (12,210,193) | (305,485) | (12,677,889) | (878,385) | |
Depreciation and amortization | 105,666 | 103,532 | 317,000 | 308,665 | |
Interest expense | 0 | 0 | 0 | 0 | |
Net income (loss) | (12,210,193) | (305,413) | (12,677,889) | (881,858) | |
Total assets | 548,406 | 548,406 | 12,897,440 | ||
Goodwill | 0 | 0 | 6,496,343 | ||
Accounts receivable, net | 1,257 | 1,257 | 12,888 | ||
A4 Aerospace - Vayu Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues, net | 0 | 0 | 4,171 | 25,000 | |
Gross profit (loss) | 0 | (593) | 1,706 | (6,064) | |
Income (loss) from operations | (13,141,251) | (916,253) | (15,342,234) | (2,542,581) | |
Depreciation and amortization | 252,704 | 258,871 | 771,294 | 792,765 | |
Interest expense | (11,372) | 0 | 0 | 0 | |
Net income (loss) | (13,186,179) | $ (916,253) | (15,427,910) | $ (2,542,581) | |
Total assets | 1,651,865 | 1,651,865 | 14,632,530 | ||
Goodwill | 0 | 0 | 0 | ||
Accounts receivable, net | $ 500,000 | $ 500,000 | $ 0 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) | 1 Months Ended | 3 Months Ended | ||||||||||||||||||||
Dec. 01, 2024 USD ($) | May 03, 2024 USD ($) | Apr. 12, 2024 USD ($) | Jan. 15, 2024 USD ($) shares | Dec. 09, 2023 USD ($) | Dec. 01, 2023 USD ($) | Oct. 31, 2023 USD ($) shares | Aug. 03, 2023 USD ($) shares | Nov. 28, 2021 USD ($) | Sep. 30, 2023 USD ($) | Jul. 31, 2023 shares | May 31, 2023 USD ($) | Feb. 28, 2023 USD ($) | Dec. 31, 2022 USD ($) | Nov. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | Oct. 31, 2021 shares | Oct. 31, 2021 USD ($) | Oct. 31, 2021 complaint | Oct. 31, 2021 lawsuit | Aug. 31, 2020 USD ($) | Oct. 31, 2023 USD ($) shares | |
Other Commitments [Line Items] | ||||||||||||||||||||||
2023 Warrant service agreement | $ 66,626 | |||||||||||||||||||||
2024 Warrant service agreement | 59,964 | |||||||||||||||||||||
Loss contingency, damages sought, value | 256,433 | $ 610,000 | $ 100,000 | $ 500,000 | $ 2,300,000 | $ 213,000 | ||||||||||||||||
Damages offered | $ 56,300 | |||||||||||||||||||||
Subsequent Event | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Loss contingency, damages sought, value | $ 75,000 | $ 900,000 | ||||||||||||||||||||
Damages offered | $ 85,000 | |||||||||||||||||||||
Horizon Well Testing Case | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Damages paid value | $ 100,000 | $ 3,300,000 | ||||||||||||||||||||
Loss contingency interest rate (as a percent) | 8% | |||||||||||||||||||||
Daily late fee | $ 575 | |||||||||||||||||||||
Number of shares settled (in shares) | shares | 250,000 | 250,000 | ||||||||||||||||||||
Horizon Well Testing Case | Subsequent Event | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Damages paid value | $ 900,000 | $ 2,000,000 | $ 250,000 | $ 380,000 | ||||||||||||||||||
Number of shares settled (in shares) | shares | 100,000 | 250,000 | 500,000 | |||||||||||||||||||
Note payable | $ 1,800,000 | |||||||||||||||||||||
Monthly note payable payment | $ 75,000 | |||||||||||||||||||||
Complaints In Discount Court of Oklahoma Country State of Oklahoma | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Loss contingency, number of claims | 3 | 3 | ||||||||||||||||||||
Complaints In Discount Court of Oklahoma Country State of Oklahoma | Settled Litigation | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Number of shares settled (in shares) | shares | 4,688 | |||||||||||||||||||||
Litigation settlement amount | $ 24,375 | |||||||||||||||||||||
Licensing Agreement | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Minimum annual payment, reminder of fiscal year | 550,000 | |||||||||||||||||||||
Minimum annual payment, year one | 600,000 | |||||||||||||||||||||
Minimum annual payment, year two | 620,000 | |||||||||||||||||||||
Minimum annual payment, year three | 660,000 | |||||||||||||||||||||
Minimum annual payment, year four | $ 700,000 | |||||||||||||||||||||
Licensing Agreement | Minimum | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Royalty fee | 2.50% | |||||||||||||||||||||
Licensing Agreement | Maximum | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Royalty fee | 3.50% | |||||||||||||||||||||
Royalty Agreements | ||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||
Payment as a percentage of net sales | 1.50% | |||||||||||||||||||||
Royalty agreement, term | 10 years | |||||||||||||||||||||
Other commitment | $ 50,000,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||
Apr. 12, 2024 | Feb. 22, 2024 | Jan. 12, 2024 | Dec. 09, 2023 | Nov. 17, 2023 | Oct. 31, 2023 | Sep. 30, 2023 | May 31, 2023 | Feb. 28, 2023 | Dec. 31, 2022 | Nov. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2023 | Dec. 31, 2023 | Dec. 27, 2023 | Nov. 08, 2023 | Sep. 29, 2023 | |
Subsequent Event [Line Items] | |||||||||||||||||
Granted (in shares) | 0 | ||||||||||||||||
Loss contingency, damages sought, value | $ 256,433 | $ 610,000 | $ 100,000 | $ 500,000 | $ 2,300,000 | $ 213,000 | |||||||||||
Asset Pledged as Collateral | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Cash | $ 2,982,000 | ||||||||||||||||
Standard Merchant Cash Advance Agreement | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Debt instrument, face amount | 2,100,000 | ||||||||||||||||
Issuance costs | $ 100,000 | ||||||||||||||||
Interest rate, effective percentage | 42% | ||||||||||||||||
Subsequent Event | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Granted (in shares) | 3,725,000 | ||||||||||||||||
Loss contingency, damages sought, value | $ 75,000 | $ 900,000 | |||||||||||||||
Subsequent Event | Thermal Dynamics International, Inc. | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Disposal Group, Including Discontinued Operation, Revenue | $ 8,500,000 | ||||||||||||||||
Disposal Group, Including Discontinued Operation, Impairment Of Intangible Assets | 11,000,000 | ||||||||||||||||
Disposal Group, Including Discontinued Operation, Impairment Of Property, Plant And Equipment | 1,000,000 | ||||||||||||||||
Disposal Group, Including Discontinued Operations, Transaction Costs | 500,000 | ||||||||||||||||
Subsequent Event | Thermal Dynamics International, Inc. | Minimum | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Disposal Group, Including Discontinued Operation, Other Expense | 10,000,000 | ||||||||||||||||
Subsequent Event | Thermal Dynamics International, Inc. | Maximum | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Disposal Group, Including Discontinued Operation, Other Expense | $ 12,000,000 | ||||||||||||||||
Subsequent Event | Chief Executive Officer | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Granted (in shares) | 700,000 | ||||||||||||||||
Subsequent Event | Chief Financial Officer | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Granted (in shares) | 300,000 | ||||||||||||||||
Subsequent Event | Chief Operating Officer | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Granted (in shares) | 600,000 | ||||||||||||||||
Subsequent Event | Vice President | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Granted (in shares) | 550,000 | ||||||||||||||||
Subsequent Event | Class A Common Stock | Chief Financial Officer | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Issuance of shares of common stock for cash, net of offering costs (in shares) | 25,000 | ||||||||||||||||
Subsequent Event | Bright-MSM Newco, Inc. | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Percentage of ownership of the asset | 100% | ||||||||||||||||
Payments for asset acquisitions | $ 1,577,488.97 | ||||||||||||||||
Asset acquisition, contingent consideration, liability | $ 157,748.9 | ||||||||||||||||
Percentage of cash portion of the purchase price | 10% | ||||||||||||||||
Subsequent Event | Asset Pledged as Collateral | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Cash | $ 745,000 | $ 1,480,500 | |||||||||||||||
Subsequent Event | Ionic Ventures | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Sale of stock, shares issued (in shares) | 32,000,000 | ||||||||||||||||
Term of agreement | 36 months | ||||||||||||||||
Subsequent Event | Standard Merchant Cash Advance Agreement | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Issuance costs | $ 38,500 | $ 50,000 | |||||||||||||||
Interest rate, effective percentage | 41% | 41% | |||||||||||||||
Subsequent Event | Standard Merchant Cash Advance Agreement | Meged Funding Group | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Debt instrument, face amount | $ 1,050,000 | ||||||||||||||||
Subsequent Event | Standard Merchant Cash Advance Agreement | AEC GAP Captial | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Debt instrument, face amount | $ 500,000 |