Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2022 USD ($) shares | |
Document Information | |
Document Type | 10-K |
Document Annual Report | true |
Document Period End Date | Dec. 31, 2022 |
Document Transition Report | false |
Entity File Number | 000-56442 |
Entity Registrant Name | GPB Holdings II, LP |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 47-3870808 |
Entity Address, Address Line One | c/o Highline Management, Inc. 33 East 33rd Street, Suite 807 |
Entity Address, City or Town | New York |
Entity Address State Or Province | NY |
Entity Address, Postal Zip Code | 10016 |
City Area Code | 877 |
Local Phone Number | 489-8484 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
ICFR Auditor Attestation Flag | false |
Entity Shell Company | false |
Entity Public Float | $ | $ 0 |
Entity Central Index Key | 0001640265 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Auditor Name | EISNERAMPER LLP |
Auditor Location | New York, New York |
Auditor Firm ID | 274 |
Class A Limited Partnership | |
Document Information | |
Entity Common Stock, Shares Outstanding | 5,892.48 |
Class A 1 Limited Partnership | |
Document Information | |
Entity Common Stock, Shares Outstanding | 3,168.26 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 334,427 | $ 356,574 |
Restricted cash | 18,227 | 9,102 |
Accounts receivable, net | 26,909 | 30,070 |
Due from related parties | 66 | |
Inventories | 1,097 | 878 |
Prepaid expenses | 5,649 | 6,781 |
Contract assets | 15,740 | 17,783 |
Investment securities, current portion | 2,135 | |
Current assets held for sale, continuing operations | 7,253 | |
Current assets held for sale, discontinued operations | 21,583 | 41,364 |
Total current assets | 423,632 | 472,006 |
Non-current assets: | ||
Restricted cash - long-term | 10,125 | |
Notes receivable - related party | 346 | |
Property and equipment, net | 8,245 | 8,788 |
Investment securities, net of current portion | 729 | 2,990 |
Equity method investments | 15,467 | 22,363 |
Right-of-use assets operating | 6,535 | 8,456 |
Assets held for sale discontinued operations, net of current portion | 16,520 | |
Goodwill | 78,895 | 78,895 |
Intangible assets, net | 67,973 | 81,790 |
Other non-current assets | 699 | 1,267 |
Total non-current assets | 178,543 | 231,540 |
Total assets | 602,175 | 703,546 |
Current liabilities: | ||
Accounts payable | 8,192 | 9,074 |
Accrued expenses | 21,510 | 24,670 |
Deferred revenue and customer deposits | 19,319 | 25,207 |
Current portion of note payable - related party | 6,458 | |
Long-term debt, current portion | 1,724 | 2,205 |
Finance lease liabilities, current portion | 224 | 227 |
Operating lease liabilities, current portion | 2,533 | 3,992 |
Due to related parties | 374 | 375 |
Other current liabilities | 271 | |
Total current liabilities | 53,876 | 72,479 |
Non-current liabilities: | ||
Long-term debt, net of current portion | 25 | 52,491 |
Finance lease liabilities discontinued operations, net of current portion | 159 | 370 |
Operating lease liabilities, net of current portion | 3,498 | 4,069 |
Deferred tax liabilities - long-term | 4,033 | 5,901 |
Other liabilities | 816 | 968 |
Total non-current liabilities | 8,531 | 63,799 |
Total liabilities | 62,407 | 136,278 |
Commitments and contingencies | ||
Partners' capital | ||
Partners' capital attributable to the Partnership | 529,172 | 551,903 |
Accumulated other comprehensive (loss) | (2,170) | (1,201) |
Total partners' capital attributable to the Partnership | 527,002 | 550,702 |
Non-controlling interests | 12,766 | 16,566 |
Total partners' capital | 539,768 | 567,268 |
Total liabilities and partners' capital | $ 602,175 | $ 703,546 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues: | |||
Product revenue | $ 71,080 | $ 61,968 | $ 46,216 |
Service revenue | 121,910 | 87,325 | 69,466 |
Debt investment interest income | 327 | 903 | 2,676 |
Gain (loss) on sale of investment securities | 26 | (712) | (97) |
Unrealized (loss) gain on investment securities | (2,261) | 3,169 | 645 |
Other revenue | 67 | 706 | 310 |
Total revenues | 191,149 | 153,359 | 119,216 |
Cost of revenues: | |||
Total cost of revenues | 102,673 | 73,043 | 54,177 |
Gross profit | 88,476 | 80,316 | 65,039 |
Operating expenses (income): | |||
Selling, general and administrative expenses | 85,998 | 86,533 | 59,379 |
Managerial assistance fee, related party | 7,852 | 11,874 | 12,245 |
Rent expense | 4,576 | 3,338 | 2,831 |
Loss (income) from equity method investments | 6,777 | (3,449) | (426) |
(Gain) loss on disposal of businesses | (6,723) | 5,334 | |
Asset impairment | 780 | ||
Depreciation and amortization | 15,174 | 10,302 | 8,717 |
Total net operating expenses | 113,654 | 113,932 | 83,526 |
Operating loss | (25,178) | (33,616) | (18,487) |
Other income (expense): | |||
Interest expense | (2,823) | (1,465) | (36) |
Interest expense to related party | (399) | (738) | (1,323) |
Interest income | 4,359 | 216 | 795 |
Loss on debt extinguishment | (4,502) | ||
Other expense | (881) | (830) | (166) |
Total other expense | (4,246) | (2,817) | (730) |
Loss from continuing operations before income tax | (29,424) | (36,433) | (19,217) |
Income tax benefit (expense) | 865 | 288 | (153) |
Net loss from continuing operations | (28,559) | (36,145) | (19,370) |
Gain on sale of discontinued operations | 7,919 | 176,799 | 31,806 |
Income from discontinued operations | 2,224 | 28,090 | 16,288 |
Income from discontinued operations, before tax | 10,143 | 204,889 | 48,094 |
Income tax expense, discontinued operations | (1,402) | ||
Income (loss) from discontinued operations | 10,143 | 204,889 | 46,692 |
Net (loss) income of continuing and discontinued operations | (18,416) | 168,744 | 27,322 |
Net income attributable to non-controlling interests | 2,364 | 2,420 | 9,439 |
Net (loss) income attributable to the Partnership | (20,780) | 166,324 | 17,883 |
Product | |||
Cost of revenues: | |||
Cost of goods and services sold | 35,574 | 26,127 | 17,396 |
Service | |||
Cost of revenues: | |||
Cost of goods and services sold | $ 67,099 | $ 46,916 | $ 36,781 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Consolidated Statements of Comprehensive (Loss) Income | |||
Net (loss) income | $ (18,416) | $ 168,744 | $ 27,322 |
Other comprehensive income (loss): | |||
Net change in unrealized (losses) gains on debt investment securities | 1,372 | (968) | |
Foreign currency translation loss | (1,072) | (296) | (150) |
Total other comprehensive (loss) income | (19,488) | 169,820 | 26,204 |
Other comprehensive loss attributable to non-controlling interests | (103) | (46) | (23) |
Net income attributable to non-controlling interests | 2,364 | 2,420 | 9,439 |
Comprehensive (loss) income attributable to the Partnership | $ (21,749) | $ 167,446 | $ 16,788 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Partners' Capital - USD ($) $ in Thousands | Class A Limited Partners | Class A-1 Limited Partners | Class B Limited Partners | Class B-1 Limited Partners | Partners' Capital Attributable to GPB Holdings II, LP | Accumulated Other Comprehensive Income (loss) | Non- Controlling Interests | Total |
Partners' capital - Beginning balance at Dec. 31, 2019 | $ 169,709 | $ 86,710 | $ 97,470 | $ 51,339 | $ 405,228 | $ (1,228) | $ 46,488 | $ 450,488 |
Increase (Decrease) in Partners' Capital | ||||||||
Unit issuance costs | (436) | (222) | (658) | (658) | ||||
Distributions | (14,570) | (7,415) | (7,760) | (4,278) | (34,023) | (34,023) | ||
Distributions to non-controlling interests holders | (23,722) | (23,722) | ||||||
Purchase of non-controlling interests | (286) | (147) | (166) | (87) | (686) | (5,814) | (6,500) | |
Net (loss) income | 6,654 | 3,739 | 4,793 | 2,697 | 17,883 | 9,439 | 27,322 | |
Other comprehensive income (loss) | (1,095) | (23) | (1,118) | |||||
Partners' capital - Ending balance at Dec. 31, 2020 | 161,507 | 82,887 | 93,901 | 49,449 | 387,744 | (2,323) | 26,368 | 411,789 |
Increase (Decrease) in Partners' Capital | ||||||||
Unit issuance costs | (75) | (8) | (83) | (83) | ||||
Distributions to non-controlling interests holders | (12,176) | (12,176) | ||||||
Tax withholding distributions | (864) | (444) | (508) | (266) | (2,082) | (2,082) | ||
Net (loss) income | 68,216 | 35,390 | 41,411 | 21,307 | 166,324 | 2,420 | 168,744 | |
Other comprehensive income (loss) | 1,122 | (46) | 1,076 | |||||
Partners' capital - Ending balance at Dec. 31, 2021 | 228,859 | 117,833 | 134,729 | 70,482 | 551,903 | (1,201) | 16,566 | 567,268 |
Increase (Decrease) in Partners' Capital | ||||||||
Distributions to non-controlling interests holders | (6,265) | (6,265) | ||||||
Transfers | (5,624) | 5,624 | 91 | (91) | ||||
Tax withholding distributions | (959) | (173) | (1,053) | 234 | (1,951) | 204 | (1,747) | |
Net (loss) income | (9,536) | (4,686) | (4,395) | (2,163) | (20,780) | 2,364 | (18,416) | |
Other comprehensive income (loss) | (969) | (103) | (1,072) | |||||
Partners' capital - Ending balance at Dec. 31, 2022 | $ 212,740 | $ 118,598 | $ 129,372 | $ 68,462 | $ 529,172 | $ (2,170) | $ 12,766 | $ 539,768 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net loss from continuing operations | $ (28,559) | $ (36,145) | $ (19,370) |
Net income from discontinued operations | 2,224 | 28,090 | 14,886 |
Gain on sale of discontinued operations | 7,919 | 176,799 | 31,806 |
Net (loss) income | (18,416) | 168,744 | 27,322 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | |||
Loss (income) from equity method investments | 6,777 | (3,449) | (426) |
(Gain) loss on disposal of business | (6,723) | 5,334 | |
Gain on sale of discontinued operations | (7,919) | (176,799) | (31,806) |
(Gain) loss on sale of debt investments | (26) | 712 | 97 |
Loss (gain) on sale of property, equipment, and leased assets | 3 | (14) | (3) |
Changes in unrealized losses (gains) on equity investment securities | 2,261 | (3,169) | (645) |
Impairment of goodwill, intangibles and long-lived assets | 780 | ||
Bad debt expense | 1,514 | 3,345 | 1,665 |
Depreciation and amortization | 16,449 | 11,577 | 12,384 |
Amortization of deferred financing costs | 286 | 167 | 47 |
Amortization of original issue discount on investment securities | (377) | ||
Amortization of right of use assets - operating and finance | 4,401 | 3,103 | 2,550 |
Paid-in-kind interest | (251) | (267) | |
Loss on extinguishment of debt | 4,502 | ||
Changes in deferred tax liabilities | (1,867) | (861) | |
Changes in operating assets and liabilities, net of effects from business combinations and dispositions: | |||
Accounts receivable, net | 319 | (3,363) | (4,474) |
Due from related parties | 66 | (256) | (364) |
Inventories | (219) | 1,089 | (1,344) |
Prepaid expenses | 1,132 | (1,476) | 380 |
Contract assets | 2,043 | (12,186) | (3,436) |
Other assets | 568 | 833 | 1,724 |
Accounts payable | (582) | 672 | 878 |
Accrued expenses | (1,078) | 2,286 | (554) |
Due to related parties | (241) | 203 | 185 |
Customer deposits | (5,888) | 10,512 | 3,885 |
Operating lease liability | (4,510) | (2,930) | (2,491) |
Other current liabilities | (403) | (1,329) | |
Other liabilities | (154) | (1,667) | 13,414 |
Net operating cash flows from discontinued operations | (2,224) | (12,084) | (20,279) |
Net cash used in operating activities | (9,929) | (9,928) | (2,484) |
Cash flows from investing activities: | |||
Purchase of businesses, net of cash acquired | (60,493) | ||
Proceeds from repayments of debt investments | 2,135 | ||
Proceeds from sale of businesses | 20,194 | 143,603 | 66,898 |
Proceeds from sale of debt investments | 26 | 3,563 | 5,106 |
Distributions received from investee | 38,643 | 189,288 | 861 |
Payment of contingent consideration | (10,800) | ||
Collections of notes receivable - related party | 344 | 1,727 | 412 |
Purchase of property and equipment | (1,554) | (5,322) | (7,276) |
Proceeds from sale of property and equipment | 11 | 39 | |
Payments for developed technology | (547) | (792) | (799) |
Net investing cash flows of discontinued operations | (2,932) | 1,336 | |
Net cash provided by investing activities | 59,252 | 257,881 | 66,538 |
Cash flows from financing activities: | |||
Repayments of notes payable, related party | (6,500) | (6,500) | |
Proceeds from loans payable | 56,460 | 6,675 | |
Repayments on loans payable | (57,527) | (100) | (100) |
Repayments on finance lease obligations | (215) | (225) | (12) |
Proceeds from lines of credit | 620 | 1,827 | 1,674 |
Repayments on lines of credit | (786) | (1,013) | (925) |
Unit issuance costs | (83) | (658) | |
Payments of debt issuance costs | (1,891) | (98) | |
Distributions | (4,033) | (34,023) | |
Purchase of non-controlling interest | (6,500) | ||
Distributions to non-controlling interest | (3,978) | (12,176) | (23,722) |
Net financing activities of discontinued operations | (4,822) | 305 | |
Net cash (used in) provided by financing activities | (72,419) | 37,977 | (63,884) |
Effect of exchange rate changes on cash | (51) | (19) | (38) |
Net (decrease) increase in cash and cash equivalents and restricted cash | (23,147) | 285,911 | 132 |
Cash and cash equivalents and restricted cash of continuing operations - beginning of year | 375,801 | 82,364 | 70,675 |
Cash and cash equivalents and restricted cash of discontinued operations - beginning of year | 7,526 | 19,083 | |
Cash and cash equivalents and restricted cash - beginning of year | 375,801 | 89,890 | 89,758 |
Cash and cash equivalents and restricted cash - end of year | 352,654 | 375,801 | 89,890 |
Less cash and cash equivalents and restricted cash of discontinued operations - end of period | (7,526) | ||
Cash and cash equivalents and restricted cash of continuing operations - end of year | 352,654 | 375,801 | 82,364 |
Supplemental disclosure of cash flow information: | |||
Cash payments for interest | 1,927 | 1,645 | |
Supplemental schedule of non-cash investing and financing activities: | |||
Debt issuance costs | (550) | ||
Distributions to non-controlling interest paid directly by buyer | (1,709) | ||
Distribution payable | 375 | (2,082) | |
Finance lease assets assumed | (741) | (94) | |
Finance lease liabilities assumed | 741 | 94 | |
Operating lease asset modification | 1,907 | ||
Operating lease liability modification | (1,907) | ||
Operating lease assets assumed | (4,387) | (3,994) | (2,049) |
Operating lease liabilities assumed | $ 4,387 | $ 3,994 | $ 2,049 |
Organization, Nature of Busines
Organization, Nature of Business and Recent Events | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Nature of Business and Recent Events | |
Organization, Nature of Business and Recent Events | 1. Organization, Nature of Business and Recent Events Organization GPB Holdings II, LP (“Holdings II”, the “Partnership”, “we”, “us”, “our” or the “Registrant”) is a holding company which was organized as a Delaware limited partnership on April 17, 2015 and commenced operations on June 1, 2015. GPB Capital Holdings, LLC (“General Partner”, “Capital Holdings”, “GPB Capital” or “GPB”), a Delaware limited liability company and registered investment adviser, is the Partnership’s General Partner pursuant to the terms of the Fourth Amended and Restated Agreement of Limited Partnership, dated April 26, 2018 (as the same may be amended from time to time, the “LPA”). Pursuant to the LPA, GPB conducts and manages our business. Robert Chmiel, GPB’s Chief Executive Officer and Chief Financial Officer, currently serves as the sole manager of GPB under the term of GPB’s limited liability company agreement. GPB has entered into a management services agreement with GPB’s wholly owned subsidiary, Highline Management, Inc. (“Highline”), pursuant to which Highline provides certain management services to GPB to assist GPB in fulfilling GPB’s duties as the Partnership’s general partner. Nature of Business The Partnership provides a range of strategic, operational and management resources to our subsidiaries which are engaged in a number of diverse business activities. Our Chief Operating Decision Maker (“CODM”) manages the segments as detailed below, regularly reviews consolidated financial information, evaluates overall strategic performance, and allocates resources to the Partnership. We report our businesses in the three segments for accounting purposes based on how our CODM views the Partnership as follows: ● Technology-Enabled Services segment (“Technology-Enabled Services” or “TES”) acquires and operates Technology-Enabled Services portfolio companies which provide Technology-Enabled Services to healthcare companies. Services provided include the sale and licensing of various electronic health records software and practice management software platforms for ambulatory, acute and long-term care facilities. The customer base served by our TES portfolio companies is dispersed across the U.S., related territories, Costa Rica and India. As of December 31, 2022, Holdings II owned 96% of Project Halo Holdings, LLC (“Halo”), which is comprised of Cantata Health Solutions, LLC (“Cantata”) (formerly Meta Healthcare IT Solutions, LLC) and Experience Care, LLC (“Experience Care”) (formerly Cantata Health, LLC); and 91.9% of HealthPrime International, LLC (“HealthPrime” or “HPI”), which includes 100% of Micro Development Services Inc. (“MDS”), all of which are accounted for under the consolidation method. Our Technology-Enabled Services also has non-controlling investments of 31% in Hotel Internet Services, LLC (“HIS”) as of December 31, 2022 which is accounted for under the equity method. HIS provides the equipment and associated services to hotels, resorts, military, student housing, casinos, and many other commercial venues. ● Energy segment (“Energy”) acquires and operates companies that provide services in the solar panel market. As of December 31, 2022 the Partnership owned 60% of Erus Holdings, LLC (“Erus”), which is accounted for under the consolidation method. In January, 2022, the Partnership sold its investment in its subsidiary Greenwave Energy, LLC (“Greenwave”). The Partnership has a 50% non-controlling equity method investment in Quantum Energy Holdings, LLC (“Quantum”). Quantum provides customer acquisition services to the alternative energy industry. ● Corporate and Other primarily consists of other operating segments that are not reportable under the quantitative thresholds under United States Generally Accepted Accounting Principles (“U.S. GAAP”), or are the selling, general or are the selling, general and administrative expenses of the Partnership. During the year ended December 31, 2021, the Partnership sold substantially all of its automotive assets including Orangeburg Subaru, LLC., and continues to own its 33.5% interest in GPB Prime Holdings, LLC (“GPB Prime”), an equity method investment, during GPB Prime’s wind down. During the year ended December 31, 2021, Holdings II sold its 76.7% interest in Riverwalk Tower LLC (“Riverwalk”), a real estate investment which was accounted for under the consolidation method. Lending Operations provides short to medium term loans, typically with 12-to-36 month durations, to companies. The Partnership has a 3% non-controlling equity method investment in Armada Waste Management Holdings, LLC (“Waste”). In March 2022, the Partnership sold its real estate investment in 124 Middleneck Realty LLC (“Middleneck”). Further information regarding our reportable business segments is contained in “Note 15. Business Segments”. Further information regarding equity method investments is contained in “Note 7. Equity Method Investments”. Highline Management, Inc. In January of 2020, Highline was formed as a wholly owned subsidiary of GPB, to provide operation support services to the GPB-managed partnerships. Highline’s formation followed the completion of an independent special investigation by outside legal counsel as a response to recommendations made by GPB’s predecessor Audit Committee to certain allegations brought against the General Partner as described below and in “Note 13. Commitments and Contingencies.” The predecessor Audit Committee made recommendations which led to a series of restructuring activities undertaken to accomplish a number of objectives including, but not limited to: (i) further enhancement of the corporate management structure, with additional professionals knowledgeable in the industry and commensurate with the complexity and demands of the business of the Partnership; (ii) formalization, to the extent possible, of the commitment to share human resources, facilities and operating assets among and between the entities that comprise the Partnership; and (iii) further development of the independent oversight of the corporate governance structure and framework to help enable the Partnership to achieve its goals, control risks and compliance with laws, rules and regulations. To that end, the initial five member Highline Board of Directors (the “Board”) (now four members) was appointed, three of whom are “independent” as that term is used in the NYSE listed company manual. To address its oversight and governance purposes, the Board established three committees, consisting entirely of the independent members, including an Audit Committee, a Governance Committee and a Compensation Committee, as more fully described below. Additionally, these restructuring activities were designed and implemented, in part, to establish an independent committee responsible for overseeing GPB’s management related to the Partnership’s affairs, establish additional layers of responsibility within the Partnership’s governance structure and enhance internal controls. As a key feature of this restructuring, Highline was formed to provide GPB with management and operation support services for the GPB-managed partnerships. Highline currently oversees on GPB’s behalf all day-to-day functions of the Partnership and its subsidiaries, including management of all underlying assets, human capital, accounting and financial reporting, and operations pursuant to a Management Services Agreement (“MSA”). As a result, Highline provides independent oversight and review of most aspects of our operations. Highline’s bylaws require a majority vote for any act of the Board except with respect to approval or adoption of any MSA, Resource Sharing Agreement or other similar agreement between Highline and GPB (or any amendment thereto), which in all instances must be approved by a majority of the independent directors. GPB has nominated and elected the initial directors to the Board. Highline has agreed to provide the following services (“Services”) to the Partnership (but not to the businesses owned by the Partnership which are managed day-to-day by their own management teams) pursuant to the MSA: • Manage and oversee the day-to-day affairs and operations of the Partnership including developing corporate strategy and business plans, and managing annual budgets; • Manage, oversee and facilitate the accounting and payment functions, including necessary cash management services with respect to the operations of the Partnership; • Manage and oversee the administration, operations, financial accounting and financial reporting for the Partnership, including managing the preparation of financial statements for the Partnership; • Manage the process for the audits of the financial statements of the Partnership; • Manage and oversee the process of obtaining third-party valuations of the Partnership in accordance with the LPA and the Class A and Class A-1 Private Placement Memorandum (the “PPM”) dated July 2018; • Communicate regularly and provide written reports (no less frequently than monthly) concerning the financial status and financial performance of the Partnership to GPB, including providing regular (no less frequent than monthly) asset management reports and updated financial models for the Partnership; • Provide periodic market data and information (no less frequent than quarterly) relating to the businesses of the Partnership reasonably requested by GPB for investor marketing and communication purposes; • Review and approve “Significant Transactions” approved by GPB’s Acquisition Committee. A Significant Transaction shall mean (i) a transaction that meets the definition of a Significant Subsidiary contained in Regulation S-X under federal securities laws; or (ii) based on criteria otherwise determined by the Board; • Review and approve any material change in the investment strategy of the Partnership; and • Perform such other services as may be reasonably requested by GPB and which are reasonably acceptable to Highline. GPB, through its Acquisition Committee, controls all major asset acquisition and divestiture decisions concerning the Partnership, subject to the approval by the Board of any such transaction that constitutes a Significant Transaction as described above. Highline’s responsibilities set forth above encompass reporting and monitoring distributions to our Limited Partners. Highline provides certain services to GPB as set forth in the MSA dated January 1, 2020. The May 2020 Amendment to the MSA set forth that the MSA would be in effect for an initial three-year term, effective as of January 1, 2020 through December 31, 2022. The MSA was subsequently amended in August 2021, under which the initial term of the MSA was extended as a five-year term, through December 31, 2024 . Pursuant to the amended order of the EDNY Court on April 14, 2021, operational and financial decisions to be made by Highline regarding the affairs of the Partnership are subject to the same authority of the Monitor as are decisions to be made by GPB. Other Events Federal Matters On February 4, 2021, the Securities and Exchange Commission (the “SEC”) filed a contested civil proceeding (the “SEC Action”) against GPB, Ascendant Capital, LLC (“Ascendant”), Ascendant Alternative Strategies, LLC (“AAS”), Mr. David Gentile, Mr. Jeffry Schneider and Mr. Jeffrey Lash in the United States District Court for the Eastern District of New York (the “EDNY Court”). No GPB-managed partnership is a named defendant. The SEC Action alleges several violations of the federal securities laws, including securities fraud. The SEC is seeking disgorgement and civil monetary penalties, among other remedies. Also, on February 4, 2021, the U.S. Attorney’s office for the Eastern District of New York the (“USAO”) brought a criminal indictment against Mr. Gentile, Mr. Schneider, and Mr. Lash (the “Criminal Case”). The indictment in the Criminal Case alleges conspiracy to commit securities fraud, conspiracy to commit wire fraud, and securities fraud against all three individuals. Mr. Gentile and Mr. Lash were also charged with two counts of wire fraud. We understand that the USAO intends to seek criminal forfeiture. Mr. Gentile resigned from all management and board positions with GPB and Highline, and the GPB-managed funds, including the Partnership, and subsidiaries of the Partnership, promptly following his indictment. State Matters On May 27, 2020, the Massachusetts Securities Division of the Office of the Secretary of the Commonwealth (“Massachusetts”) filed an Administrative Complaint against GPB for alleged violations of the Massachusetts Uniform Securities Act. No GPB-managed fund is a named defendant. The complaint alleges, among other things, that the offering documents for several GPB-managed funds, including the Partnership, included material misstatements or omissions. Massachusetts is seeking both monetary and administrative relief, including disgorgement and rescission to Massachusetts residents who purchased the GPB-managed funds. This matter is currently stayed, pending resolution of the Criminal Case. On February 4, 2021, seven State securities regulators (from Alabama, Georgia, Illinois, Missouri, New Jersey, New York, and South Carolina, collectively the “States”) each filed suit against GPB. No GPB-managed fund is a named defendant in any of the suits. Several of the suits also named Ascendant, AAS, Mr. Gentile, Mr. Schneider, and Mr. Lash as defendants. The States’ lawsuits allege, among other things, that the offering documents for several GPB-managed funds, including the Partnership, included material misstatements and omissions. The States are seeking both monetary and administrative relief, including disgorgement and rescission. The cases brought by the States have been stayed pending the conclusion of the related Criminal Case. The State of New Jersey has voluntarily dismissed its case, without prejudice to re-file it following the conclusion of the Criminal Case. Appointment of Monitor and Application for Receivership On February 11, 2021, the EDNY Court in the SEC Action appointed Joseph T. Gardemal III as an independent monitor over GPB (the “Monitor”) until further order of the Court (the “Order”). The Court appointed the Monitor in response to a request from the SEC, which asserted that the Monitor was necessary to protect investors in light of the alleged misconduct of GPB Capital’s former CEO, David Gentile. In its February 4, 2021 complaint (“the Complaint”) in the SEC Action, the SEC alleged that Mr. Gentile, as the owner and then-CEO of GPB Capital, along with Jeffry Schneider, the owner of Ascendant, GPB’s placement agent, lied to investors about the source of money used to make 8% annualized distribution payments to investors. According to the SEC, Mr. Gentile and others allegedly told investors that the distribution payments were paid exclusively with monies generated by GPB portfolio companies, but as alleged, GPB actually used investor money to pay portions of the annualized 8% distributions. The Complaint further contains allegations that Mr. Gentile and others manipulated financial statements of certain Limited Partnership funds that GPB manages to perpetuate the deception by giving the false appearance that the funds’ income was closer to generating sufficient income to cover the distribution payments than it actually was. Moreover, the Complaint alleges that Mr. Gentile engaged in undisclosed self-dealing, including by omitting from investor communications certain conflicts of interest and fees and other compensation that he received, totaling approximately $8.0 million. In support of the Order, the SEC contended that the Monitor would provide assurances to investors, GPB’s counterparties, and the public that an unbiased and qualified person who was not beholden to Mr. Gentile was vetting any significant transactions and decisions, and looking out for the interests of investors. Accordingly, pursuant to the Order, GPB shall (i) grant the Monitor access to all non-privileged books, records and account statements for the GPB-managed funds, including the Partnership, as well as their portfolio companies; and (ii) cooperate fully with requests by the Monitor reasonably calculated to fulfill the Monitor’s duties. As noted below, the Order was amended on April 14, 2021 (the “Amended Order”). The Monitor is required to assess the Partnership’s operations and business, and make recommendations to the EDNY Court, which may include continuation of GPB’s operations subject to the Monitorship, a liquidation of assets, or filing for reorganization in bankruptcy. The Order provides that the Monitor will remain in place until terminated by order of the EDNY Court, and grants the Monitor the authority to approve or disapprove proposed material corporate transactions by GPB, the Partnership and its subsidiaries, extensions of credit by them outside the ordinary course of business, decisions to make distributions to the Limited Partners of the Partnership, or any decision to file any bankruptcy or receiver petition for any of them, among other actions. The Monitor is not required to approve the issuance of the Consolidated Financial Statements included with this Form 10-K, nor has management sought or obtained approval from the Monitor. On April 14, 2021, the EDNY Court entered an Amended Order, providing that, in addition to the SEC and GPB, certain State regulators will receive access to the periodic reports filed by the Monitor pursuant to the Order. The following discussion about the authority of various governing bodies of GPB, the Acquisition Committee, Highline, and their respective officers and directors, is qualified by reference to the Amended Monitor Order. See “Note 13. Commitments and Contingencies” to our Consolidated Financial Statements for more information on the appointment of the Monitor. On May 31, 2022, Mr. Gentile filed a motion in the SEC Action to modify the Amended Order pursuant to Rule 60(b) of the Federal Rules of Civil Procedure (“Rule 60(b) Motion”). In his Rule 60(b) Motion, Mr. Gentile seeks a court order to, among other things, (i) narrow the scope of the Monitor’s responsibilities; and (ii) direct the Monitor to ensure that GPB does not sell or otherwise dispose of assets or portfolio companies that the Partnership owns before the completion of a “strategic assessment” to be conducted by three managers Mr. Gentile purportedly appointed to GPB on May 27, 2022. On that same day, May 31, 2022, the Monitor notified Mr. Gentile and GPB that Mr. Gentile’s purported appointment of three new managers to GPB without Monitor approval was, amongst other things, in violation of the Amended Order. Mr. Gentile and GPB were, at that time, given ten (10) business days to cure the violation of the Amended Order. The cure period expired without any steps having been taken to comply with the Monitor’s notification of violation of the Amended Order. On June 13, 2022, the SEC filed by Order to Show Cause in the SEC Action an application to (i) convert the existing Monitorship over GPB and the GPB-managed funds to a Receivership, and appoint the previously-appointed Monitor, Joseph T. Gardemal III, as Receiver; and (ii) impose a litigation injunction on cases filed against GPB and the GPB-managed funds (the “Receivership Application”). The Receivership Application and the Proposed Order Appointing Receiver and Imposing Litigation Injunction (the “Proposed Order”) were filed with the EDNY Court with consent of GPB’s management. The Receivership Application seeks appointment of Mr. Gardemal as Receiver in order to, in part, streamline the process by which GPB and the GPB-managed funds liquidate remaining portfolio company assets and distribute money to Limited Partners, subject to the EDNY Court’s supervision. The Proposed Order grants to Mr. Gardemal, generally, all powers and authorities previously possessed by the entities subject to the Proposed Order, as well as the powers possessed by the officers, directors, managers and others previously in charge of those entities, and permits him to, among other things, take all such actions necessary to preserve receivership assets. Additionally, the Receivership Application includes a proposed stay of all Federal and State actions (as well as any arbitrations) presently pending against GPB and the GPB-managed funds, and provides for a centralized claims process for Limited Partners, in the EDNY Court, to prevent potentially disparate actions in different courts that could negatively impact the assets proposed to be subject to the EDNY Court’s jurisdiction and control. The Rule 60(b) Motion and the validity of the appointment of the new managers are presently under consideration by the EDNY Court, along with the Receivership Application. Currently, there can be no assurance as to the outcome of the Rule 60(b) Motion or the Receivership Application. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The Consolidated Financial Statements through December 31, 2022, have been prepared in accordance with U.S. GAAP assuming the Partnership will continue as a going concern. Principles of Consolidation and Equity Method The Consolidated Financial Statements include the accounts of the Partnership and its subsidiaries in which it has a controlling interest. Intercompany accounts and transactions have been eliminated in consolidation. Our strategy in the segments in which we choose to participate is to invest in and operate income producing, middle market private companies primarily in North America. We focus on owning and operating portfolio companies on a long-term basis with a goal of maximizing returns for our investors by improving operational performance, and in turn, increasing the value. We strive to create long-term value and generate cash flow from operations for our Limited Partners by building industry-leading companies. To accomplish our objectives, we acquire controlling interests in operating companies and provide managerial expertise and investment capital to develop the operations and enhance the overall value of the business. In other situations, we acquire equity that affords us the ability to exercise significant influence over the business without a controlling stake. For this reason, we classify the earnings from our investments in entities where we have the ability to exercise significant influence as a component of operating income in our Consolidated Statements of Operations. Consolidation Method. The Partnership has a controlling interest when it owns a majority of the voting interest in an entity or when it is the primary beneficiary of a variable interest entity (“VIE”). A VIE is an entity in which the equity investment holders have not contributed sufficient capital to finance its activities or the equity investment holders do not have defined rights and obligations normally associated with an equity investment. The primary beneficiary is the party who has both the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and an obligation to absorb losses of the entity or a right to receive benefits from the entity that could potentially be significant to the entity. When determining which enterprise is the primary beneficiary, management considers (i) the entity’s purpose and design, (ii) which variable interest holder has the power to direct the activities that most significantly impact the entity’s economic performance, and (iii) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. When certain events occur, the Partnership reconsiders whether it is the primary beneficiary of that VIE. VIE’s are consolidated by the primary beneficiary. Non-Controlling Interests Non-controlling interests represent the portion of net assets in consolidated entities that are not owned by the Partnership. When the Partnership acquires a controlling interest in a consolidated entity, the non-controlling interest is initially recorded at fair value and subsequently adjusted for any capital transactions between the third-party investors and the consolidated entity that occur during the period and by net income (loss) attributable to non-controlling interests. Equity Method. The Partnership accounts for investment in companies where it does not exercise control and whose results are not consolidated, over which it is able to exercise significant influence under the equity method. Significant influence is generally considered to exist when our ownership interest in the voting stock of the investee is within quantitative guidance, although other factors, such as representation on the investee’s board of directors and the impact of commercial arrangements, are also considered in determining whether the equity method of accounting is appropriate. Under the equity method of accounting, the investments are initially recorded at cost and subsequently adjusted by the Partnership’s proportionate share of the investee’s net income or losses and any dividend distributions. We record contributions and distributions as an increase or decrease in the carrying value of the investment, respectively. When the Company’s interest in an equity method investment company is reduced to zero, the Company records no further losses in its Consolidated Statements of Operations unless the Company has an outstanding guarantee obligation or has committed additional funding to such equity method investment company. When such equity method investment company subsequently reports income, the Company will not record its share of such income until it exceeds the amount of the Company’s share of losses not previously recognized. The Partnership also evaluates the equity method investments for potential impairment whenever events or changes in circumstances indicate that there is an other than temporary decline in value of the investment. Such events include, but are not limited to, sustained operating losses by the investee or long‑term negative changes in the investee’s industry and sales of ownership interests at prices below our carrying value of our investment. During the year ended December 31, 2022, $8.0 million in impairment charges were recorded in loss from equity method investments on the Consolidated Statement of Operations, there were no impairment charges for the years ended December 31, 2021 and 2020. The impairment charge at Hotel Internet Services, Inc. (“HIS”) was the result of a permanent degradation in expected future operating performance and cash flows due to the loss of a primary revenue source. The loss of the primary revenue source is a direct result of the cessation of the manufacture of a technology component used in the delivery of the internet services for which a cost-effective alternative is not presently available. The charge at Quantum Energy Holdings, LLC (“Quantum”) was the result of the culmination of deterioration in the Company’s customer base and the Company’s decision not to expand into new markets due to excessive migration costs both of which are considered to be permanent in nature. Use of Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The actual results could differ from the estimates and assumptions made in the preparation of the accompanying Consolidated Financial Statements. The significant estimates made by management in the accompanying Consolidated Financial Statements relate to the fair value of assets acquired and liabilities assumed in business combinations, the valuation of goodwill and intangibles, reserves for potential litigation liabilities, depreciable lives, valuation of long-lived assets, and valuation of investments securities and equity method investments. Business Combinations The Partnership accounts for acquisitions in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations. ASC 805 provides guidance for recognition and measurement of identifiable assets and goodwill acquired, liabilities assumed, and any non-controlling interest in the acquiree at fair value. In a business combination, the net assets acquired, liabilities assumed and non-controlling interest in the acquired businesses are recorded as of the date of acquisition at their respective fair values. Any excess of the purchase price (consideration transferred) over the estimated fair values of net assets and identifiable intangible assets acquired is recorded as goodwill. Transaction costs are expensed when incurred. The operating results of the acquired businesses are reflected in our Consolidated Financial Statements commencing on the date of the acquisition. The Partnership records the net assets of acquired businesses at fair value, based, in part, upon internal estimates of cash flows and independent appraisals. Changes to the assumptions used to estimate the fair value could impact the recorded amounts of the net assets acquired and the resultant goodwill. Fair values of customer relationships are estimated by discounting expected future cash flows of the customers. Developed technology and tradenames are estimated using the relief from royalty method by estimating the savings attributable to having purchased the asset. Software platforms are valued at replacement cost and non-compete agreements are estimated using the with and without method that compares the prospective cash flows with and without the non-compete agreement in place. The fair value of real property is determined using a combination of the cost approach (the comparative unit method) and sales comparison approach (the building residual technique method). Cash and Cash Equivalents Cash and cash equivalents includes cash on hand, cash in bank accounts without restriction, and investments in Treasury Bills with original maturities of no longer than three months. The Partnership maintains cash balances with financial institutions that, at times, may exceed federally insured limits. Management periodically evaluates the creditworthiness of these institutions and has not experienced any losses on such deposits. As of December 31, 2022, the standard Federal Deposit Insurance Corporation (FDIC) insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per ownership category. Any deposit in excess of this insured amount could be lost. As of December 31, 2022, substantially all of the Partnership’s $30.1 million of deposited cash held in banks was in excess of the FDIC coverage limit. As of December 31, 2022, $304.3 million was invested in Treasury Bills, with original maturities of no longer than three months, are not presented in the table above. The Partnership uses Signature Bank for the majority of its banking. On March 12, 2023 the FDIC appointed the New York State Department of Financial Services as a receiver for Signature Bank and subsequently closed the bank. To protect the customers, substantially all of the deposits were moved to Signature Bridge Bank, N.A that will be a full service bank during a transition to a new permanent bank. GPB does not believe this will have a material impact on the financial statements of the Partnership, however, no assurance can be provided. As of December 31, 2022 the Partnership had $20.9 million of cash deposits at Signature Bank. Restricted Cash As of December 31, 2022, the Partnership held $18.2 million of total Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable primarily consist of trade receivables from customers, which are paid by customers and financing companies (Energy). Receivables are recorded at the invoiced amount or the amount expected to be received under contractual agreements. The Partnership maintains an allowance for doubtful accounts for estimated losses inherent in its accounts receivable. In establishing the required allowance, management considers payor terms, historical losses, current market conditions and customers’ financial condition, the amount of receivables in dispute, the current receivables aging and current payment patterns. Past due balances over 90 days are reviewed for collectability. Accounts receivable are written off against allowances after all reasonable collection efforts are exhausted. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation, or at the estimated fair value at the date of acquisition for property and equipment purchased in connection with a business combination. Property and equipment under capital leases are stated at the lower of the present value of minimum lease payments or the fair value of the asset at the inception of the lease, net of accumulated depreciation. Major additions and improvements which extend the useful lives of the assets are capitalized, while minor replacements, repairs, and maintenance, which do not improve or extend the lives of the assets, are expensed as incurred. Once the assets are placed into service, they are depreciated in accordance with the Partnership’s policy. Depreciation and amortization are computed over the estimated useful lives of the assets or the respective lease term for leasehold improvements, whichever is shorter using the straight-line method. Estimated useful lives are as follows: Property and Equipment Useful Lives Buildings 10 - 40 years Leasehold improvements Lesser of lease term or useful life Computer and office equipment 3 - 7 years Furniture and fixtures 3 - 7 years Vehicles 5 - 7 years Computer software 4 - 7 years The Partnership continually evaluates property and equipment, including leasehold improvements, to determine whether events and circumstances have occurred that may warrant revision of the estimated useful life or whether the remaining balance should be evaluated for possible impairment. The Partnership uses an estimate of the related un-discounted cash flows over the remaining life of the property and equipment in assessing whether an asset has been impaired. Management measures impairment losses based upon the amount by which the carrying amount of the asset exceeds the fair value and recognizes the impairment charge as a component of operating expenses. Leases The partnership accounts for leases under Accounting Standards Update (“ASU”) 2016-02, Leases (“ASC 842”), as amended. The Partnership determines if an arrangement is a lease at inception. Right-of-use (“ROU”) assets represent the Partnership’s right-to-use of an underlying asset for the lease term and lease liabilities represent the Partnership’s obligation to make lease payments arising from the lease. Finance leases are recorded in right-of-use assets - finance, on the Consolidated Balance Sheets. Operating lease obligations are included in operating lease liabilities on the Consolidated Balance Sheets. The classification of the Partnership’s leases as operating or finance leases, along with the initial measurement and recognition of the associated ROU assets and lease liabilities is performed at the lease commencement date. The measurement of lease liabilities, for all leases with terms longer than 12 months is based on the present value of future lease payments over the lease term. As the implicit rate in the lease is not determinable, the Partnership uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future lease payments. The ROU asset is based on the measurement of the lease liability and also includes any lease payments made prior to or on lease commencement, and excludes lease incentives and initial direct costs incurred, as applicable. The lease terms may include options to extend or terminate the lease when it is reasonably certain the Partnership will exercise any such options. Rent expense for the Partnership’s operating leases is recognized on a straight-line basis over the lease term. Amortization expense for the ROU asset associated with its finance leases is recognized on a straight-line basis over the shorter of the useful life of the asset or the lease term. The term of the lease and interest expense associated with its finance leases is recognized on the balance of the lease liability using the effective interest method based on the estimated incremental borrowing rate. Goodwill and Intangible Assets Goodwill represents the excess cost of businesses acquired over the fair value of the identifiable net assets. The Partnership’s indefinite lived intangible assets include certain tradenames and trademarks. The Partnership expects certain of its tradenames and trademarks will contribute to cash flows for an indefinite period. Definite lived intangible assets listed in the table below are recorded at fair value on the date of acquisition and amortized over their estimated useful lives using the straight‑line method. Software development costs are capitalized when these are ready for service from the time technological feasibility of the software is established. Amortization of the software development begins when the product is available for general release. Capitalized software costs incurred in connection with software development and platforms sold in the Technology-Enabled Services segment are capitalized once the software has reached technological feasibility which the Partnership considers to be a working model. Costs incurred in the maintenance and minor upgrade and enhancement of the Partnership’s software platforms without additional functionality are expensed as incurred. Internal and external costs, if direct and incurred for adding incremental functionality to the Partnership’s platform are capitalized until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. Costs incurred prior to attaining technological feasibility are expensed as incurred. Goodwill is not amortized but is tested for impairment at the reporting unit level at least annually or more often if events occur or circumstances change that could cause these assets to become impaired. Based on the Partnership’s internal reporting structure, the level at which discrete financial information is available and for which operating results are regularly reviewed and the economic similarity of its components, the Partnership has determined it has three reporting units: Erus, a component of the Energy segment, HPI and Halo, which are components of the Technology-Enabled Services segment. We test our goodwill and indefinite lived intangibles for impairment on December 31 of each year. If the Partnership determines that it is more likely than not that the fair value of the goodwill and indefinite lived intangibles of each reporting unit is less than their respective carrying amounts, then a quantitative impairment test would be performed. Under the quantitative impairment test, the fair value of the goodwill and indefinite lived-intangible of each reporting unit is compared to their respective carrying value. If the fair value of the goodwill and indefinite-lived intangible of each reporting unit exceed their respective carrying values, no impairment charge would result. If the fair value of the goodwill and indefinite lived intangible of each reporting unit is less than their respective carrying values, than an impairment charge would be recorded for the excess of the carrying amount of the reporting unit’s goodwill and indefinite-lived intangible assets over the implied fair value of those assets. Our definite-lived intangible assets consist primarily of amortizable intangible assets acquired in business combinations, customer relationships, software development and platforms, certain tradenames and trademarks and covenants not to compete. Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives. We review definite-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amount to future undiscounted cash flows the assets are expected to generate. If definite-lived assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds their fair market value. The estimated useful lives of the intangible assets as of December 31, 2022 were: Intangible Assets Useful Lives Customer relationships 8 - 15 years Software platform 4 - 7 years Developed technology 8 years Covenant not-to-compete 2 - 5 years Trade names and trademarks 3 - 5 years Impairment of Long-Lived Assets Long-lived assets, such as property and equipment subject to depreciation, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Partnership first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models and quoted market values. Impairment losses are recorded as a component of operating expenses in the Consolidated Statements of Operations. Fair Value of Financial Assets and Liabilities The Partnership’s financial instruments consist of cash, accounts receivables, contract assets, accrued expenses, notes payable, and debt. Fair values for cash, receivables, contract assets and accrued expenses approximate carrying values for these financial instruments because they are relatively short-term in nature. The carrying amount of notes payable and debt approximates fair value based on the length of maturity and existence of interest rates that approximate prevailing rates for similar instruments over similar periods of time. Fair Value Measurements The Partnership utilizes valuation techniques that maximize the use of observable inputs. The Partnership determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: • Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. • Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. A financial instruments categorization with the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. Assets Held for Sale and Discontinued Operations The Partnership classifies long-lived assets (disposal groups) to be sold as held for sale in accordance with ASU 2014-08, Presentation Of Financial Statements (ASC Topic 205) And Property, Plant, And Equipment (ASC Topic 360): Reporting Discontinued And Disclosures Of Disposals Of Components Of An Entity The fair value of a long-lived asset (disposal group) less any costs to sell is assessed each reporting period it remains classified as held for sale and any subsequent changes are reported as an adjustment to the carrying value of the asset (disposal group), as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale. Upon determining that a long-lived asset (disposal group) meets the criteria to be classified as held for sale, the Partnership reports the assets and liabilities of the disposal group for all periods presented in the line items assets held for sale and liabilities held for sale in the accompanying Consolidated Balance Sheets. The Partnership recognizes an impairment loss if the carrying amount of the long-lived asset (disposal group) exceeds the estimated fair value of the long-lived asset (disposal group) less cost to sell. If the Partnership recognizes an impairment loss, the adjusted carrying amount of the long-lived asset (disposal group) becomes its carrying amount. The Partnership classifies long-lived assets that meet the criteria to be classified as held for sale, as discontinued operations when a disposal group represents a strategic shift that has or will have a major effect on the Partnership’s operations and its financial results. The results of all discontinued operations, less applicable income taxes are reported as a separate component of income. Any gain or loss recognized on the disposal of a discontinued operation is presented separately on the Consolidated Statement of Operations. Cost of Revenues The ’s cost of revenues represents the amounts related to the sale of products and services. These costs include direct labor employee costs, travel, outsourcing, depreciation of software platforms and materials and parts. Selling, General and Administrative Expenses The Partnership’s operating expenses include, among others, payroll expenses, commissions, administrative expenses, audit fees, professional and insurance expense, litigation related and indemnification expenses, and taxes or other governmental charges levied against the Partnership. Partnership expenses may include broken deal expenses. The Partnership is allocated from GPB a portion of the total compensation of GPB’s or its affiliates’ officers and employees relating to the time such officers or employees provide services to the Partnership or its subsidiaries. Revenue Recognition The Partnership follows the provisions of ASC 606, Revenue from Contracts with Customers Technology-Enabled Services : prices charged to clients. In instances where stand-alone selling price is not observable, the Company utilizes an estimate of stand-alone selling price. Such estimates are derived from various methods that include: cost plus margin, historical pricing practices, and the residual approach. Energy Utility resales is revenue from the sale of natural gas to end consumers. Revenue is based on actual volumes sold to customers as the product is delivered, where delivery is the point at which the customers consume the natural gas. Customers are billed monthly on a cycle basis. The Company accrues unbilled revenues for natural gas delivered to customers, but not yet billed at month-end. Revenue is measured at the fair value of the consideration received, excluding discounts, rebates and sales taxes. The business reports revenue net of fulfillment costs in the accompanying Consolidated Statement of Operations as the business acts as an agent in these transactions . Contract Assets Contract assets relate to the Partnership’s pre-payment for materials and services performed and paid upon the installation of solar systems which is before the PTO completion date and revenue recognition. The contract assets are recognized as cost of goods sold and operating expense in the accompanying Consolidated Statement of Operations, concurrent with revenue recognition at the PTO date. Income Taxes The Partnership is a US-based limited partnership treated as a pass-through entity for U.S. federal and state income tax purposes. Some of the Partnership’s wholly owned subsidiaries are classified as corporations and subject to U.S. federal, state, and in some cases, foreign income taxes. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Partnership reduces the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. The need to establish valuation allowances for deferred tax assets is assessed quarterly. In assessing the requirement for, and amount of, a valuation allowance in accordance with the more likely than not standard for all periods, the Partnership considers all positive and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods, and tax planning alternatives. A history of cumulative losses is a significant piece of negative evidence used in the assessment. If a history of cumulative losses is incurred for a tax jurisdiction, forecasts of future profitability are not used as positive evidence related to the realization of the deferred tax assets in the assessment. Risks and Uncertainties We are subject to a number of legal proceedings at both the Partnership and our portfolio companies, as described in “Note 13. Commitments and Contingencies.” While we are vigorously defending our position in these proceedings, there is uncertainty surrounding their related outcomes and timing. The cost to defend and outcomes of these proceedings could affect the liquidity of the Partnership and the use of available cash. The Technology-Enabled Services industry is subject to rapid innovation, which forces companies to move swiftly to react to changes in the industry. Maintenance of state-of-the-art technology and network equipment is costly and requires expertise. It can be difficult to accurately price our Technology-Enabled Services portfolio companies’ long-term service contracts, which could negatively affect our business. Renewal of customer service contracts and establishment of new customer relationships are essential for growth of our Technology-Enabled Services portfolio companies. Our revenue could decline if we are unable to renew contracts and establish new relationships. Our Technology-Enabled Services portfolio companies derive a significant portion of their revenues from a limited number of customers. Our Technology-Enabled Services portfolio companies rely on their top vendor partners. We outsource a significant portion of our Technology-Enabled Services to offshore service providers which can subject us to a number of risks that may affect our ability to meet our customers’ expectations, contractual obligations and regulatory requirements. If the emerging technologies and platforms upon which we build our products do not gain or continue to maintain broad market acceptance, or if we fail to develop and introduce in a timely manner new products and services compatible with such emerging technologies, we may not be able to compete effectively and our ability to generate revenue will suffer. We are dependent on our license rights and other services from third parties, which may cause us to discontinue, delay or reduce product shipments. We may experience interruption at our data centers or client support facilities. In our healthcare information technology business, we and our clients are subject to a number of existing laws, regulations and industry initiatives, including The Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and other data privacy regulations, and we are susceptible to a continually changing and complex regulatory environment. We own and operate portfolio companies engaged in the energy business, which are subject to various market and regulatory risks that could have a negative impact on our financial results, including changes to government-sponsored incentives to adoption of solar energy, solar panel supply chain interruptions and changes in the relative price of energy sources supplying the electric grid. Many of our customers in this segment finance their purchases, and high levels of inflation or increased interest rates may discourage such purchases in the future. Our energy segment had one major vendor that accounted for substantially all material purchases in cost of sales for the year ended December 31, 2022, 2021 and 2020, respectively. Accounts payable to this vendor were $1.5 million and $3.6 million at December 31, 2022 and 2021, respectively. The Monitor is required to assess the Partnership’s operations and business, and make |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Recognition | |
Revenue Recognition | 3. Revenue Recognition The following is a disaggregation of revenue by major product or service lines, separated by reportable segments from which the Partnership generates its revenue. For more detailed information about reportable segments, see “Note 15. Business Segments”. Technology - Enabled (Dollars in thousands) Services Energy Total 2022 Product revenue $ 2,158 $ 68,922 $ 71,080 Service revenue 121,910 — 121,910 Revenue Stream Software licenses 2,158 — 2,158 Software maintenance and support 18,726 — 18,726 Professional services 23,390 — 23,390 Medical billing and services 79,794 — 79,794 Solar panel sales — 68,922 68,922 Timing of Revenue Recognition Products and services transferred at a point in time $ 2,158 $ 68,922 $ 71,080 Products and services transferred over time 121,910 — 121,910 Technology - Enabled (Dollars in thousands) Services Energy Total 2021 Product revenue $ 4,405 $ 57,563 $ 61,968 Service revenue 87,325 — 87,325 Revenue Stream Software licenses 4,405 — 4,405 Software maintenance and support 18,190 — 18,190 Professional services 23,511 — 23,511 Medical billing and services 45,624 — 45,624 Solar panel sales — 54,111 54,111 Utility resales — 3,452 3,452 Timing of Revenue Recognition Products and services transferred at a point in time $ 4,405 $ 57,563 $ 61,968 Products and services transferred over time 87,325 — 87,325 Technology - Enabled (Dollars in thousands) Services Energy Total 2020 Product revenue $ 6,726 $ 39,490 $ 46,216 Service revenue 69,466 — 69,466 Revenue Stream Software licenses 6,726 — 6,726 Software maintenance and support 18,057 — 18,057 Professional services 16,462 — 16,462 Medical billing and services 34,947 — 34,947 Solar panel sales — 35,534 35,534 Utility resales — 3,956 3,956 Timing of Revenue Recognition Products and services transferred at a point in time $ 6,726 $ 39,490 $ 46,216 Products and services transferred over time 69,466 — 69,466 Debt investment interest income, gain (loss) on sale of investment securities, unrealized gain (loss) on investment securities and other revenue earned from success fees on debt investments included in our consolidated revenues are not within the scope of ASC 606. |
Acquisitions and Dispositions
Acquisitions and Dispositions | 9 Months Ended |
Sep. 30, 2022 | |
Acquisitions and Dispositions | |
Acquisitions and Dispositions | 4. Acquisitions and Dispositions 2022 ACQUISITION Technology-Enabled Services On July 18, 2022, GPB HPI Holdings, LLC (“HPI Holdings”) a Delaware limited liability Company and 89% owned subsidiary of the Partnership, entered into an agreement to acquire 100% of the outstanding shares of MDS, an 80% owned subsidiary of the Partnership for cash consideration of $13.5 million net of $0.5 million to be paid to a non-controlling shareholder in quarterly installments commencing in July 2022. Transaction costs were $0.3 million. At the consummation of the transaction, the assets and liabilities of MDS were recorded on HPI’s books at their respective carrying values. There were no outflows of cash for the purchase of MDS and no gain or loss was recorded in connection with the transaction as MDS and HPI Holdings were both under common control of the Partnership prior to and after the consummation of the transaction. MDS is included in the HPI Holdings reporting unit. 2022 DISPOSITIONS In January, 2022, Greenwave Energy, LLC (“Greenwave”), a subsidiary of the Partnership entered into an Asset Purchase Agreement with United Energy Trading, LLC (“UET”). The Asset Purchase Agreement became effective on January 1, 2022, at which time UET acquired all customer contracts for the sale of natural gas or renewable energy credits and carbon offsets as well as intellectual property rights to the Greenwave name in exchange for $4.4 million in net cash proceeds. The $4.4 million in net cash proceeds were received in January 2022. The Partnership recorded a gain of $4.4 million on disposal of the business in January 2022. In March, 2022, the Partnership sold Middleneck, the real estate of its shuttered Tower Ford dealership for net proceeds of $9.9 million, to the current operator of an auto dealership on the site, subject to standard post-closing adjustments. The Partnership recorded a gain of approximately $2.3 million on disposal of the real estate in 2022. 2021 ACQUISITIONS Technology-Enabled Services On September 30, 2021, GPB HPI Holdings, LLC (“HPI Holdings”), a Delaware limited liability Company and subsidiary of the Partnership, entered into an agreement to acquire all of the issued, outstanding stock and voting rights of AHS for $81.6 million which included cash consideration of $58.3 million ($3.3 million in cash and the issuance of new term loans for $55.0 million) (net of cash and restricted cash acquired of $7.4 million) and the fair value of the earnout of $15.9 million, which is a level 3 financial asset. The terms of the new loans are discussed in “Note 10. Borrowings”. The earnout was valued using a Monte-Carlo simulation. The earnout is contingent on AHS retaining certain customers, with $10.8 million being earned and paid as of December 31, 2021. HPI provides Revenue Cycle Management (“RCM”) and data analytics based practice management tools for small to large independent medical groups. AHS provides technology-enabled outsourced RCM solutions to physician practices and institutions and broadens the offerings of HPI across medical practice management technology. Transaction costs were $1.8 million. AHS is included in the HPI reporting unit. On November 1, 2021, Cantata acquired all of the issued, outstanding stock and voting rights of Pro-Comp Software Consultants, Inc. (“Pro-Comp”), an Ohio corporation, or $3.1 million in cash which included cash consideration of $2.1 million and an earnout of $1.0 million, which is a level 3 financial asset. The fair value of the earnout was determined using a Monte Carlo simulation. The earnout is contingent on Pro-Comp achieving certain future net sales targets. Cantata focuses on RCM and Electronic Health Records management (“EHR”) software solutions for long term care, skilled nursing, and assisted living environments Pro-Comp is focused on EHR software and storage which compliments Cantatas existing offerings. Pro-Comp is included in the Halo reporting unit. The results of operations of the acquired entities have been included in the consolidated results of the Partnership from the date of acquisition. The components of the acquired balance sheets, which were recorded at fair value, were as follows: (Dollars in thousands) AHS ProComp Current assets $ 17,217 $ 82 Property and equipment 1,362 — Other assets 316 — Intangible assets 35,200 880 Goodwill 41,778 2,191 Current liabilities (6,317) (8) Deferred tax liability (6,474) — Other liabilities (1,482) — Net assets $ 81,600 $ 3,145 Partnership’s ownership 100 % 100 % In connection with the 2021 acquisitions, the Partnership identified the following intangible assets: (Dollars in thousands) AHS ProComp Useful Lives Customer relationships $ 25,300 $ 320 8 - 12 Years Software development and platform cost 8,200 560 5 Years Trademarks and trade names 1,700 — 8 - 10 Years Total $ 35,200 $ 880 The accompanying Consolidated Statement of Operations for the year ended December 31, 2021, includes $10.7 million of revenue and a net loss of $0.6 million, related to AHS for the period from September 30, 2021, (date of acquisition), through December 31, 2021. The accompanying Consolidated Statement of Operations for the year ended December 31, 2021 includes $137 thousand of revenue and net income of $33 thousand for Pro-Comp for the period from November 1, 2021 (date of acquisition) through December 31, 2021. The Partnership’s unaudited pro forma consolidated results for the years ended December 31, 2021 and 2020, are summarized in the table below, assuming the acquisition of AHS and Pro-Comp had occurred on January 1, 2020. These unaudited pro forma results have been prepared for comparative purposes only and do not purport to be indicative of the results of operations which would have actually resulted had the acquisition occurred on January 1, 2020, or are they indicative of future results of operations. The Partnership’s unaudited pro forma consolidated results of operations (as if the acquisition of AHS and Pro-Comp had occurred on January 1, 2020) is as follows: Year ended December 31, (Dollars in thousands) 2021 2020 Pro forma revenue $ 184,999 $ 160,383 Pro forma net loss from continuing operations $ (36,509) $ (19,524) 2021 DISPOSITIONS Automotive Group On September 12, 2021, GPB Automotive Portfolio, LP (“APLP”), Automile Parent, Capstone Automotive Group, LLC, Capstone Automotive Group II, LLC (“Capstone II”), Automile TY Holdings, LLC (each, a “Seller” and collectively, the “Sellers”) and Prime Real Estate Holdings, LLC (the “Real Estate Equity Seller” and, together with the Sellers, the “Seller Parties” and, together with their respective subsidiaries, the “Selling Entities”), each a Delaware limited liability company, entered into a purchase agreement (the “Automotive Purchase Agreement”) with Group 1 Automotive, Inc. (the “Purchaser” or “Group 1”), a Delaware corporation. Pursuant to the Automotive Purchase Agreement, the Seller Parties agreed to sell substantially all of the assets of the Selling Entities (“Prime Automotive Group”). APLP and Holdings II are each invested in GPB Prime Holdings, LLC (“GPB Prime”) through the Sellers, Holdings II through its wholly owned subsidiary Capstone II (owner of Orangeburg Subaru, LLC “Orangeburg”) and APLP through its interest in the other Sellers. In November 2021, the Selling Entities obtained the necessary manufacturer approvals and completed the sale of substantially all of its assets, including real estate, three collision centers, and 27 of its 29 dealerships to Group 1. In December 2021, the Selling Entities obtained the necessary manufacturer approvals and completed the sale of its 28th dealership and the related real estate to a third-party. The aggregate consideration for all of the 28 dealership purchases and real estate was $824.9 million after taking into account the payoff of floorplan financing and mortgage debt outstanding at the time of the Group 1 Sale. The aggregate consideration is subject to customary post-close adjustments as defined in the Automotive Purchase Agreement. The 29th dealership, Prime Subaru Manchester, has not received approval for transfer from its Subaru distributor in New Hampshire, however, the closing consideration of $33.4 million was initially put in escrow by Group 1 and was subsequently released to the Selling Entities in April 2022. The Selling Entities continue to own and operate Prime Subaru Manchester while awaiting approval of the transfer. See “Note 13. Commitments and Contingencies” for more information on the Prime Subaru Manchester transaction. Included in the aggregate consideration of $824.9 million for the sale of 28 dealerships and real estate includes $763.6 million received directly by GPB Prime, which was, restricted from distribution to the Partnership or any of its affiliates pursuant to the terms of the M&T Credit Agreement. On December 28, 2021, GPB Prime reached an agreement in principle with M&T Bank to allow for distribution to APLP and the Partnership, a sum of $570.0 million of which $188.8 million was distributed to the Partnership. As result, effective December 31, 2021, Highline management, on behalf of GPB, commenced the plan to liquidate APLP’s remaining net assets and wind up APLP (“Plan of Liquidation”). In March and April 2022, GPB Prime reached additional agreements in principle with M&T Bank to allow for distributions to APLP and the Partnership, of a sum of $115.0 million, of which $38.5 million was distributed to the Partnership. In January 2023, an additional $8.0 was distributed to the Partnership. The Partnership recorded a gain of $96.5 million in connection with the sale of dealerships and real estate by GPB Prime. The gain on sale is recorded as a component of gain on sale of discontinued operations in the accompanying 2021 Consolidated Statements of Operations. As of December 31, 2022, the Partnership continues to hold a 33.5% non-controlling interest in GPB Prime. The carrying value of the investment at December 31, 2022 and 2021 was $21.6 million and $57.9 million, respectfully, is included in assets held for sale in the accompanying Consolidated Balance Sheets. As part of the Group 1 Sale described above Orangeburg, a 100% owned subsidiary of the Partnership, was sold for $28.1 million after standard closing adjustments net cash proceeds were $24.6 million. The Partnership recorded a gain of $5.9 million in connection with the sale of the dealership. The gain on sale is recorded as a component of gain on sale of discontinued operations in the accompanying 2021 Consolidated Statement of Operations. The Partnership’s investments in GPB Prime and Orangeburg previously constituted the Automotive Retail Segment. Alliance On November 15, 2021, Alliance Physical Therapy Partners, LLC (“Alliance”), the Partnership and Alliance PT Buyer, Inc. (the “Buyer”) entered into a membership Interest Purchase Agreement whereby all of the Partnership’s membership interests were sold to the Buyer. The sale closed on December 21, 2021 at which time net proceeds of $119.0 million were received by the Partnership and the Partnership recorded a gain on sale of $74.4 million which is recorded as a component of gain on sale of discontinued operations in the accompanying Consolidated Statement of Operations. The Partnerships investment in Alliance previously constituted the Physical Therapy segment. Commencing in 2021, we no longer consolidate the Automotive Retail and Physical Therapy segments within our financial results or reflect the financial results of these segments within our continuing results of operations. The historical results of operations and financial positions of the Automotive Retail and Physical Therapy segments through the date of sale, are reported as Discontinued Operations in the Consolidated Financial Statements. For further information on discontinued operations, See “Note 5. Discontinued Operations and Assets Held for Sale” Riverwalk Tower On September 17, 2021, GPB Riverwalk LLC, (“GPBR”), a wholly owned subsidiary of the Partnership and TRD Riverwalk LLC, an unrelated Florida Limited Liability Company (“TRD”), entered into an Agreement on Purchase of Membership Interests (the “APMI”). The APMI provides for the sale of all the membership interests held by GPBR in Riverwalk Tower, LLC in exchange for a $28.3 million promissory note payable, bearing interest at 9.5% per annum compounded annually, up to the receipt by GPBR of $20.8 million, whereupon the interest will terminate and no longer accrue. The promissory note is open ended with no fixed term. Because of the uncertainty with collection of the promissory note, the Partnership recorded a loss on disposal of business of $5.3 million in the accompanying Consolidated Statement of Operations equal to the carrying value of the net investment in Riverwalk Tower LLC at the date of its sale. In the event it becomes probable that the promissory note will be paid by TRD, the Partnership may record a gain equal to the amount of such proceeds received. 2020 ACQUISITIONS Technology-Enabled Services In September 2020, the Partnership acquired additional equity interests of Halo for $6.5 million which includes $5.8 million return of capital to the non-controlling interest. As a result of this transaction, the Partnership’s ownership interest increased to from 79% to 96%. As there was no change in control, the difference between the carrying value of the non-controlling interest and the consideration paid of $0.7 million, is included in the Consolidated Statement of Partners’ Capital. 2020 DISPOSITIONS In February 2020, the Partnership sold its interests in Matrix PEO Holdings, LLC (“Matrix”) and Surge PEO Holdings, LLC (“Surge”), for net proceeds of $82.4 million including $15.5 million in cash. The sale of Matrix and Surge comprise the Partnership’s former Business Services segment and represents a strategic shift in the Partnership’s operations and therefore, qualifies to be reported as discontinued operations. The Partnership recorded a net gain on disposal of the discontinued operations of $30.4 million recorded in income from discontinued operations in the Consolidated Statement of Operations for the year ended December 31, 2020. During the year ended December 31, 2022, the Partnership received the final earnout payment of $5.9 million, $1.7 million was paid directly to non-controlling interest holders, and wrote off liabilities of $0.3 million resulting in a gain on disposal of discontinued operations of $7.9 million recorded in income from discontinued operations in the Consolidated Statement of Operations. Commencing in 2020, we no longer consolidate the Business Services segment within our financial results or reflect the financial results of these segments within our continuing results of operations. The historical results of operations and financial positions of the Business Services segment through the date of sale are reported as Discontinued Operations in the Consolidated Financial Statements. For further information on discontinued operations, See “Note 5. Discontinued Operations and Assets Held for Sale” |
Discontinued Operations and Ass
Discontinued Operations and Assets Held for Sale | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations and Assets Held for Sale | |
Discontinued Operations and Assets Held for Sale | 5. Discontinued Operations and Assets Held for Sale The following dispositions represent a strategic shift in the Partnerships operations and financial results and therefore, the Partnership is presenting the operating results and cash flows as discontinued operations in the accompanying financial statements for all periods presented. Automotive Retail As discussed in “Note 4. Acquisitions and Dispositions,” GPB Prime, in which the Partnership continues to hold a 33.5% equity investment completed the sale of substantially all of its assets, including real estate, three collision centers and 28 dealerships in 2021 resulting in a gain on sale of discontinued operations of $96.5 million. The Partnership also sold its wholly owned dealership, Orangeburg, in 2021 resulting in a gain on sale of discontinued operations of $5.9 million. The Partnership’s remaining investment in GPB Prime of $21.6 million is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2022. Upon completion of the sale, the Partnership will have no involvement in the operations of GPB Prime or Orangeburg. Summarized operating results for the Automotive Retail segment for 2022, 2021 and 2020 were as follows: Year ended December 31, (Dollars in thousands) 2022 2021 2020 Revenues $ — $ 69,255 $ 78,354 Cost of revenues — 57,678 66,550 Gross profit — 11,577 11,804 Operating income 2,224 12,468 5,193 Operating income 2,224 24,045 16,997 Other income — 284 (986) Income from discontinued operations 2,224 24,329 16,011 Gain on sale of discontinued operations — 102,419 — Net income from discontinued operations $ 2,224 $ 126,748 $ 16,011 Summarized cash flow for the Automotive Retail segment for 2022, 2021 and 2020 were as follows: Year ended December 31 (Dollars in thousands) 2022 2021 2020 Cash provided by (used in) Operating activities $ — $ 5,619 $ 1,276 Investing activities 38,643 (5) (21) Financing activities — (12,339) 2,475 Net increase (decrease) in cash and cash equivalents $ 38,643 $ (6,725) $ 3,730 The cash flow amounts in the table above exclude the effects of transactions among and between Automotive Retail and the Partnership. Physical Therapy On December 21, 2021, as discussed in “Note 4. Acquisitions and Dispositions,” we completed the sale of Alliance which comprised our Physical Therapy segment businesses. Upon completion of the sale, the Partnership will have no involvement in the operations of Alliance. Summarized operating results for the Physical Therapy segment for 2021 and 2020 were as follows: Year ended December 31, (Dollars in thousands) 2021 2020 Revenues $ 75,322 $ 65,662 Cost of revenues 53,678 51,523 Gross profit 21,644 14,139 Operating expenses (18,102) (16,387) Operating income (loss) 3,542 (2,248) Other income 219 1,710 Income (loss) from discontinued operations 3,761 (538) Gain on sale of discontinued operations 74,380 — Net income (loss) from discontinued operations $ 78,141 $ (538) Summarized cash flow for the Physical Therapy segment for 2021 and 2020 were as follows: Year ended December 31 (Dollars in thousands) 2021 2020 Cash provided by (used in) Operating activities $ 10,386 $ (6,441) Investing activities (2,927) (2,643) Financing activities (14,985) 12,216 Net (decrease) increase in cash and cash equivalents $ (7,526) $ 3,132 The cash flow amounts in the table above exclude the effects of transactions among and between Physical Therapy and the Partnership. Corporate and Other Real estate with a $7.2 million carrying value is included in assets held for sale on the balance sheet as of December 31, 2021. Business Services The Partnership elected to exit the Business Services operating segment which provided professional employer organizations services. On September 27, 2019, the Partnership signed an agreement with an investment bank committing to sell all of its equity interests of Matrix and 100% of the equity interests of Surge, its employee leasing business subsidiaries to Matrix PEO Holdings Acquisition, LLC, a third party. Upon completion of the sale, the Partnership will has involvement in the operations of Matrix and Surge. On February 14, 2020, the Partnership completed the sale of Matrix and Surge, for $82.4 million net of $15.5 million in cash acquired by the buyer. The Partnership recognized a gain as a result of the sale of Matrix and Surge on February 14, 2020 of $31.8 million, net of taxes and after customary and normal working capital adjustments. During the year ended December 31, 2022, the Partnership received the final earnout payment of $5.9 million, $1.7 million was paid directly to non-controlling interest holders, and wrote off liabilities of $0.3 million resulting in a gain on disposal of discontinued operations of $7.9 million recorded in income from discontinued operations in the Consolidated Statement of Operations. Summarized operating results for Matrix and Surge for 2020 were as follows: Year ended December 31, (Dollars in thousands) 2020 Revenues $ 2,232 Cost of revenues 922 Gross profit 1,310 Operating expenses 495 Operating loss 815 Other income (expense) — Income from discontinued operations 815 Gain on sale of discontinued operations 31,806 Income tax expense on discontinued operations (1,402) Net income from discontinued operations $ 31,219 Summarized cash flow for Matrix and Surge for 2020 were as follows: Year ended December 31 (Dollars in thousands) 2020 Cash provided by (used in) Operating activities $ (228) Investing activities 4,000 Financing activities — Net increase in cash and cash equivalents $ 3,772 The cash flow amounts in the table above exclude the effects of transactions among and between Business Services and the Partnership. |
Receivables, net
Receivables, net | 12 Months Ended |
Dec. 31, 2022 | |
Receivables, net | |
Receivables, net | 6. Receivables, net Receivables, net of allowance for doubtful accounts, consisted of the following: December 31, (Dollars in thousands) 2022 2021 Receivables Energy $ 1,866 $ 7,667 Technology-enabled services 27,155 23,348 Corporate and other — 509 Total 29,021 31,524 Allowance for doubtful accounts Energy (223) (617) Technology-enabled services (1,889) (837) Total (2,112) (1,454) Receivables, net $ 26,909 $ 30,070 |
Equity Method Investments
Equity Method Investments | 12 Months Ended |
Dec. 31, 2022 | |
Equity Method Investments. | |
Equity Method Investments | 7. Equity Method Investments For a discussion of the business activities of the Partnership’s equity method investments See “Note 1. Organization, Nature of Business and Recent Events”. The carrying amounts of equity method investments were as follows: December 31, 2022 2021 Ownership Carrying Ownership Carrying (Dollars in thousands) Segment Percentage Amount Percentage Amount Investment Quantum Energy Holdings, LLC Energy 50.0 % $ 9,397 50.0 % $ 12,282 Hotel Internet Services, LLC Technology-Enabled Services 31.0 % 5,996 31.0 % 10,007 Other 74 74 $ 15,467 $ 22,363 Income (losses) from equity method investments were as follows: Years Ended December 31, (Dollars in thousands) 2022 2021 2020 Investment Quantum Energy Holdings, LLC $ (2,885) $ 2,263 $ 327 Hotel Internet Services, LLC (4,010) 672 (114) Other 118 514 213 Total $ (6,777) $ 3,449 $ 426 For the year ended December 31, 2022, impairment charges of $2.9 million and $5.1 million were recorded on Quantum and HIS, respectively, which is recorded in loss (income) from equity method investments in the Consolidated Statement of Operations. The impairment charge at HIS was the result of a permanent degradation in expected performance and cash flows due to the loss of a primary revenue source. The loss of a primary revenue source is a direct result of the cessation of the manufacture of a technology component used in the delivery of the internet services for which a cost-effective alternative is not presently available. The charge at Quantum was the result of the culmination of the deterioration in the Company’s customer base and the Company’s decision not to expand into new markets due to the excessive migration costs both of which are considered to be permanent in nature. The impairment charge was based on a quantitative assessment that indicated that the carrying value was greater than the fair value. Fair values were determined using a combination of the income approach and the market approach. Condensed balance sheet data of equity method investments were as follows: (Dollars in thousands) Quantum HIS December 31, 2022 Current assets $ 5,763 $ 5,194 Non-current assets 515 608 Current liabilities 4,179 3,032 Non-current liabilities 2,045 150 Non-controlling interest (801) — Equity attributable to the Partnership 855 2,620 December 31, 2021 Current assets $ 6,256 $ 3,619 Non-current assets 863 353 Current liabilities 5,611 1,867 Non-current liabilities 2,157 716 Non-controlling interest (777) — Equity attributable to the Partnership 128 1,389 Condensed income statement data of equity method investments were as follows: (Dollars in thousands) Quantum HIS Year ended December 31, 2022 Revenue $ 20,165 $ 10,348 Net income 727 1,232 Year ended December 31, 2021 Revenue $ 20,809 $ 8,644 Net income 5,202 811 Year ended December 31, 2020 Revenue $ 21,816 $ 6,741 Net income 1,515 25 Reconciliation of the Partnership’s interest in underlying equity of the investee to the carrying amount of the Partnership’s interest included in the Consolidated Balance Sheet of the Partnership as of December 31, 2022 and 2021: (Dollars in thousands) Quantum HIS December 31, 2022 Partnership interest in underlying equity $ 428 $ 812 Allocation of contractual income — 1,704 (Distributions) Contributions (6,671) 226 Step up in basis, net of amortization 15,640 3,254 Carry amount of Partnership interest $ 9,397 $ 5,996 December 31, 2021 Partnership interest in underlying equity $ 64 $ 431 Other — 853 (Distributions) Contributions (6,671) 226 Step up in basis, net of amortization 18,889 8,497 Carry amount of Partnership interest $ 12,282 $ 10,007 GPB Prime Holdings, LLC (“GPB Prime”) The Partnership, together with an affiliate, APLP own a 33.5% and 66.5% ownership interest, respectively, in GPB Prime. The Partnership accounts for its ownership in GPB Prime under the equity method. The carrying value of the Partnership’s investment in GPB Prime included in assets held for sale was $21.6 million and $57.9 million as of December 31, 2022 and 2021, respectively. As discussed in “Note 4. Acquisitions and Dispositions” and “Note 5. Discontinued Operations and Assets Held for Sale” GPB Prime completed the sale of substantially all of its assets, including real estate, three collision centers and 28 dealerships during the year ended December 31, 2021. On December 28, 2021, to allow for distributions to the Partnership and APLP, Highline management, on behalf of GPB, commenced Plan of Liquidation. Because the sale and Plan of Liquidation represented a strategic shift in the Partnerships operations and financial results, the Partnership has included the GPB Prime equity method investment and related equity method investment income in assets held for sale and discontinued operations, respectively, for all periods presented. The Consolidated Financial Statements of GPB Prime are included below because GPB Prime was a material investee of the Partnership in 2021 and 2020. As discussed above, APLP, the parent of GPB Prime, has commenced its Plan of Liquidation and has transitioned to the liquidation basis of accounting effective December 31, 2021. The effects of the transition to a liquidation basis of accounting have been included in the unaudited Consolidated Financial Statements as of and for the year ended December 31, 2022, presented below. The Consolidated Financial Statements as of and for the years ended December 31, 2021 and 2020, presented below, have been prepared in accordance with U.S. GAAP assuming the Partnership would continue as a going concern. GPB Prime Holdings, LLC Consolidated Balance Sheets as of December 31, 2022 (Liquidation Basis) December 31, 2022 (unaudited) Assets Cash and cash equivalents $ 44,231 Restricted cash 20,224 Contracts in transit 990 Receivables 2,672 Estimated receipts during liquidation 1,067 Assets held for sale 3,650 Total assets $ 72,834 Liabilities Floorplan payable 2,514 Accounts payable 1,640 Accrued expenses and other liabilities 3,127 Liabilities held for sale 1,127 Total liabilities 8,408 Net Assets in Liquidation $ 64,426 GPB Prime Holdings, LLC Consolidated Statement of Changes in Net Assets in Liquidation for the year ended December 31, 2022 (Liquidation Basis) Year ended December 31, 2022 (unaudited) Net assets in liquidation, beginning of period $ 172,842 Changes in net assets in liquidation: Increase in accounts receivable 75 Increase in assets held for sale 1,091 Decrease in accounts payable 1,532 Decrease in accrued expenses and other liabilities 5,938 Changes in Liability for estimated costs in excess of estimated receipts during liquidation (653) Net changes in liquidation value 7,983 Proceeds received in excess of assets recorded 3,601 Payments made in excess of liabilities recorded (5,000) Tax distributions made in excess of liabilities recorded — Distributions to Members (115,000) Changes in net assets in liquidation (108,416) Net assets in liquidation, end of period $ 64,426 GPB Prime Holdings, LLC Consolidated Balance Sheets as of December 31, 2021 and 2020. December 31, 2021 2020 Assets Current assets: Cash $ 107,012 $ 90,609 Current portion of restricted cash 18,949 — Contracts in transit 531 32,767 Receivables, net of allowance for doubtful accounts 7,276 29,201 Due from related parties, current portion 408 — Inventories — 223,314 Prepaid expenses and other current assets 10,614 10,613 Lease rental/service vehicles — 12,463 Assets held for sale 21,647 94,532 Total current assets 166,437 493,499 Non-current assets: Restricted cash, net of current portion 18,949 14,427 Property and equipment, net — 216,252 Goodwill — 135,378 Franchise rights — 112,663 Right-of-use assets - operating — 46,164 Right-of-use assets - finance — 21,944 Due from related parties, net of current portion — 6,340 Other assets 8,254 7,179 Total non-current assets 27,203 560,347 Total assets 193,640 1,053,846 Current liabilities: Accounts payable $ 5,568 $ 30,796 Accrued expenses and other current liabilities 8,687 26,833 Liabilities held for sale 2,236 2,273 Notes payable - related party, current portion — 903 Long-term debt, current portion — 17,894 Redeemable non-controlling interests, current portion — 18,450 Floorplan payable 3,373 246,022 Operating lease liabilities, current portion 133 3,559 Finance lease liabilities, current portion — 787 Leased vehicle liability — 12,510 Total current liabilities 19,997 360,027 Non-current liabilities: Long-term debt, net of current portion — 233,308 Operating lease liabilities, net of current portion 801 44,040 Finance lease liabilities, net of current portion — 22,121 Other liabilities — 1,577 Redeemable non-controlling interests, net of current portion — 9,973 Total non-current liabilities 801 311,019 Total liabilities 20,798 671,046 Members’ capital 172,842 382,800 Total liabilities and members’ capital $ 193,640 $ 1,053,846 GPB Prime Holdings, LLC Consolidated Statements of Operations for the Years ended December 31, 2021 and 2020. Years ended December 31, 2021 2020 Revenues: New vehicle retail sales $ 805,280 $ 872,701 Used vehicle retail sales 499,933 512,528 Used vehicle wholesale sales 78,747 64,312 Service, body, and parts sales 187,920 210,772 Finance and insurance sales 72,088 68,644 Total revenues 1,643,968 1,728,957 Cost of sales: New vehicle retail cost 723,587 811,404 Used vehicle retail cost 458,053 475,584 Used vehicle wholesale cost 69,716 60,729 Service, body, and parts cost 78,896 90,191 Total cost of sales 1,330,252 1,437,908 Gross profit 313,716 291,049 Operating expenses: Selling, general and administrative expenses 235,578 212,007 (Gain) loss on sale of dealerships, property and equipment, net (288,064) 275 Rent expense 5,063 7,425 Asset impairment 892 2,744 Depreciation and amortization 7,506 8,580 Total operating (income) expenses (39,025) 231,031 Operating income 352,741 60,018 Other income (expense): Floorplan interest (2,648) (6,800) Interest expense (7,957) (11,675) Interest expense to related parties (704) (561) Other income (expense), primarily gain on forgiveness of debt 12,060 (379) Total other income (expense), net 751 (19,415) Net income 353,492 40,603 Net income attributable to non-controlling interests 118,420 13,452 Net income attributable to the Partnership $ 235,072 $ 27,151 GPB Prime Holdings, LLC Consolidated Statements of Cash Flow for the Years ended December 31, 2021 and 2020. Years ended December 31, 2021 2020 Cash flows from operating activities: Net income attributable to GPB Prime Holdings, LLC $ 353,492 $ 40,603 Adjustments to reconcile net income to net cash provided by operating activities Depreciation 6,388 7,361 Amortization of right-of-use assets - finance 1,118 1,219 Amortization of right-of-use assets - operating 3,742 3,901 Amortization of debt issuance costs in interest expense 3,493 1,010 Asset impairment 892 2,744 (Gain) loss on disposal of property and equipment, net (32,259) 1,584 (Gain) loss on sale of dealerships, net (261,070) (1,309) Increase (decrease) in interest rate swap liability in interest expense (835) 835 Bad debt recovery, net (77) 1,260 PPP loan forgiveness (14,860) — Expense related to net income attributable to NCI 2,801 — Other adjustments to reconcile net income/loss (693) 918 Changes in operating assets and liabilities: Contracts in transit 32,236 3,618 Receivables 22,058 3,176 Due from related parties 4,971 10,581 Inventories 111,325 87,992 Prepaids expenses (income) and other current assets (1,679) 3,315 Leased rental/service vehicles 12,463 3,170 Other assets (1,312) (2,697) Accounts payable (25,228) 3,487 Accrued expenses (17,442) (8,749) Payments on lease liabilities - operating (3,427) (3,645) Leases vehicle liability (12,510) (3,075) Other liabilities 11,159 1,576 Net cash provided by operating activities 194,746 158,875 Cash flows from investing activities: Payments for disposition of dealerships — — Purchase of property and equipment (18,099) (7,751) Proceeds from disposition of property and equipment 264,402 12,577 Proceeds from disposition of dealerships 581,809 9,095 Net cash provided by (used in) investing activities 828,112 13,921 Cash flows from financing activities: Payments of floorplan debt, non-trade, net (146,808) (105,696) Proceeds from long-term debt — 27,888 Payments of long-term debt (236,811) (29,633) Payments of finance lease liabilities (1,796) (747) Payments of deferred financing costs (2,190) (782) Partners' capital contributions — — Capital contributions from non-controlling interests 10,777 3,700 Distributions to partners and non-controlling interests (574,229) (64) Distributions to mandatorily redeemable capital (31,927) — Net cash (used in) provided by financing activities (982,984) (105,334) Net increase in cash and restricted cash 39,874 67,462 Cash and restricted cash, beginning of year 105,036 37,574 Cash and restricted cash, end of year $ 144,910 $ 105,036 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Property and Equipment | 8. Property and Equipment Components of property and equipment were as follows: December 31, (Dollars in thousands) 2022 2021 Property and equipment Buildings $ 4,476 $ 5,044 Leasehold improvements 747 775 Computer and office equipment 4,410 3,202 Furniture and fixtures 528 750 Vehicles 2,272 1,892 Computer software 1,473 1,229 Total 13,906 12,892 Accumulated depreciation and amortization (5,661) (4,104) Total property and equipment, net $ 8,245 $ 8,788 Depreciation expense related to property and equipment for the years ended December 31, 2022, 2021 and 2020 was $2.1 million and $1.5 million and $1.1 million, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 9. Goodwill and Intangible Assets As of December 31, 2022 and 2021, goodwill consisted of the following: Technology - Enabled (Dollars in thousands) Services Energy Total Balance, December 31, 2022 $ 64,601 $ 14,294 $ 78,895 Goodwill acquired through business combinations — — — Balance, December 31, 2021 64,601 14,294 78,895 Goodwill acquired through business combinations 43,969 — 43,969 Balance, January 1, 2021 $ 20,632 $ 14,294 $ 34,926 The Partnership performed quantitative impairment testing in 2022, 2021 and 2020. The Partnership determined the estimated fair value of the goodwill was greater than its respective carrying value and an no impairment charge was warranted. See further information on goodwill acquired which is included in “Note 4. Acquisitions and Dispositions”. As of December 31, 2022 and 2021, intangible assets consisted of the following: Weighted Gross Average Carrying Accumulated Net Carrying Remaining (Dollars in thousands) Amount Impairment Amortization Amount Lives (Years) December 31, 2022 Customer relationships $ 90,658 $ — $ (37,993) $ 52,665 5.6 Trademark and trade names 5,760 — (3,108) 2,652 1.7 Software development and platform cost 38,610 — (25,954) 12,656 4.1 Covenant not to compete 1,341 — (1,341) — — Total $ 136,369 $ — $ (68,396) $ 67,973 December 31, 2021 Customer relationships $ 90,658 $ — $ (28,148) $ 62,510 9.8 Trademark and trade names 5,760 — (2,308) 3,452 2.7 Software development and platform cost 38,067 — (22,239) 15,828 7.6 Covenant not to compete 1,341 — (1,341) — — Total $ 135,826 $ — $ (54,036) $ 81,790 (1) The Partnership capitalized software development and platform costs of $0.5 million, $0.7 million and $0.8 million, respectively, during the years ended December 31, 2022, 2021 and 2020. Amortization expense related to intangible assets was $14.4 million, $10.0 million and $11.3 million, for the years ended December 31, 2022, 2021 and 2020, respectively. The Amortization expense for software development and platform included in cost of revenues for the years ended December 31, 2022, 2021 and 2020 was $1.3 million, $1.2 million and $3.7 million, respectively. The Partnership recorded an impairment loss based on a quantitative assessment that indicated that the carrying value was greater than fair value of $0.8 million related to trademarks and trade names during the year ended December 31, 2020. No impairment was recorded for the year ended December 31, 2022 and 2021. Estimated amortization expense for each of the next five years and thereafter is as follows: Estimated (Dollars in thousands) Amortization Expense 2023 $ 13,625 2024 12,934 2025 11,936 2026 11,077 2027 7,426 Thereafter 9,366 Total $ 66,364 |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings | |
Borrowings | 10. Borrowings Debt Debt, other than amounts due to related-parties and lease obligations, as of December 31, 2022 and 2021, consists of the following: December 31, (Dollars in thousands) 2022 2021 Promissory notes $ — $ 55,000 Lines of credit 1,624 1,790 Installment notes 125 225 Total long-term debt 1,749 57,015 Less: current maturities (1,724) (2,205) Less: debt issuance costs — (2,319) Long term debt, less current maturities $ 25 $ 52,491 The aggregate contractual maturities of debt as of December 31, 2022 were as follows: Contractual (Dollars in thousands) Amount 2023 $ 1,724 2024 25 2025 and thereafter — Total $ 1,749 Promissory Notes The Partnership held the following Promissory notes: ● On September 30, 2021, the Partnership entered into a Credit and Guaranty Agreement with Crestline Direct Finance, L.P. (“Crestline Agreement”) in the amount of $57.0 million in connection with the acquisition of AHS by HealthPrime International, LLC(“HPI”). The $ 57.0 million consisting of (i) $55.0 million aggregate principal amount of term loans and (ii) $2.0 million aggregate principal amount of revolving commitments, subject to the terms and conditions of the Crestline Agreement. The debt bore interest at LIBOR plus 8% , which became due and payable in escalating quarterly payments over five years beginning on September 30, 2022, and had a maturity date of September 30, 2026. Debt issuance costs were $2.4 million and were being amortized over the term of the loan of which $0.4 million had been amortized through September 30, 2022. HPI was also required to pay the lender an additional fee (the “Exit Fee”) upon repayment of the loan at any time for any reason. The amount of the Exit Fee is equal to the lessor of 1 percent of the stated amount the loan, or an amount based on the greater of the trailing twelve months earnings before interest, taxes, and depreciation, or the implied fair value of the equity of AHS. The Partnership has estimated the fair value of the Exit Fee to be $0.6 million on the date of issuance. The Partnership has included the Exit Fee as a component of debt issuance costs and with a corresponding liability recorded in accrued expenses on the Consolidated Balance Sheets. On June 29, 2022 the Partnership repaid the Crestline loan in full. Total repayment of the loan was $57.4 million which included principal of $55.0 million, interest premium of $2.3 million and legal fees of $0.1 million. In addition, the Partnership paid a $0.6 million of exit fee that was previously included in accrued expenses. Expenses totaling $4.5 million associated with the loan repayment consisting of unamortized debt costs of $2.1 million, interest premium of $2.3 million and $0.1 million of legal fees are recorded in loss on extinguishment of debt in the Consolidated Statements of Operations . ● The Partnership has a credit agreement outstanding with BBVA Compass Bank. The credit agreement requires equal principal payments plus interest at the bank’s prime rate plus 4.0% . Repayments were $100 thousand and $100 thousand in the years ended December 31 , 2022 and 2021, respectively. The note matures in March 2024. The outstanding amounts due on the note as of December 31, 2022 and 2021 were $125 thousand and $225 thousand, respectively. The note payable is secured by substantially all the assets of the Partnership. Lines of Credit The Partnership has a line of credit with BBVA Compass Bank. The line requires monthly payments of interest only at the prime rate plus 0.25% per annum (7.75% as of December 31, 2022 and 3.5% as of December 31, 2021) through maturity in July 2026. The outstanding balances on the line of credit as of December 31, 2022 and 2021, were $1.6 million and $1.8 million, respectively. There were borrowings of $0.6 million and $1.8 million for the years ended December 31, 2022 and 2021, respectively. Repayments on the line of credit were $0.8 million and $1.0 million for the years ended December 31, 2022 and 2021, respectively. PPP loan On April 10, 2020, Orangeburg Subaru, LLC, received funding in connection with “Small Business Loans” under the federal Paycheck Protection Program provided in Section 7(a) of the Small Business Act of 1953, as amended by the Coronavirus Aid, Relief and Economic Security Act, as amended from time to time (the “PPP”). Orangeburg Subaru, LLC, borrowed $1.1 million original principal amount, which was funded on April 10, 2020 (the “PPP Loan”). The PPP loan bore interest at 1% per annum and matured in 2022. Interest and principal payments under the PPP loan was deferred for a period of 6 months. The Partnership was approved for full forgiveness of the PPP loan amount of $1.1 million in April 2021. The loan was forgiven in full in April 2021; the $1.1 million gain is included in other income on the Consolidated Statement of Operations. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Income Taxes | 11. Income Taxes The partnership is a US-based limited partnership treated as a pass-through entity for U.S. federal and state income tax purposes. Some of the Company’s wholly owned subsidiaries are classified as corporations and subject to U.S. federal, state, and in some cases, foreign income taxes. Domestic and foreign components of income (loss) from continuing operations before income taxes for the years ended December 31, 2022, 2021 and 2020 are shown below: December 31, (Dollars in thousands) 2022 2021 2020 Domestic $ (33,258) $ (38,262) $ (20,332) Foreign 3,834 1,829 1,115 Loss from continuing operations before income tax $ (29,424) $ (36,433) $ (19,217) The benefit (expense) for income taxes attributable to loss from continuing operations for the years ended December 31, 2022, 2021 and 2020 consisted of: December 31, (Dollars in thousands) 2022 2020 2020 Current: Federal $ (23) $ — $ — State (219) (123) — Foreign (731) (398) (176) (973) (521) (176) Deferred: Federal 1,614 419 — State 282 418 — Foreign (58) (28) 23 1,838 809 23 Income tax benefit (expense) $ 865 $ 288 $ (153) A reconciliation of the difference between income tax benefit (expense) from continuing operations at the statutory rate and the Partnerships’ total income tax provision for the years ended December 31, 2022, 2021 and 2020 is as follows: December 31, 2022 2021 2020 Statutory federal tax rate $ 6,179 $ 7,651 $ 4,036 Non-taxable earnings (4,832) (7,471) (4,270) State income taxes, net of federal benefit 108 321 — Foreign earnings subject to different tax rates (14) (41) 81 Non-deductible expenses (878) (162) — Deferred adjustments including provision to return 290 — — Other 12 (10) — Income tax benefit (expense) $ 865 $ 288 $ (153) The significant components of deferred income tax assets and liabilities as of December 31, 2022 and 2021 were attributable to: December 31, (Dollars in thousands) 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 401 $ 259 State net operating loss carryforwards 170 99 Pension liability — 175 Interest limitation - Sec 163j 2,868 2,377 Accrued vacation — 223 Right of use asset - lease liability 391 — Other 314 127 Total deferred tax assets 4,144 3,260 Valuation allowance — — Total deferred tax assets, net of valuation allowance 4,144 3,260 Deferred tax liabilities: Intangible assets (7,292) (8,571) Right of use assets (394) — Property and equipment (491) (590) Total deferred tax liabilities (8,177) (9,161) Total net deferred tax liabilities $ (4,033) $ (5,901) We reduce the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. The deferred tax assets all relate to one wholly owned subsidiary of the Partnership. In assessing the need for a valuation allowance, appropriate consideration is given to all positive and negative evidence related to the realization of deferred tax assets. This assessment considers, among other matters, the nature and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods, and tax planning alternatives. A history of cumulative losses is a significant piece of negative evidence used in our assessment. If a history of cumulative losses is incurred for a tax jurisdiction, forecasts of future profitability are not used as positive evidence related to the realization of the deferred tax assets in the assessment. As of December 31, 2022, the Company has determined that no valuation allowance was necessary because expectations for future taxable income, including the reversing effect of taxable temporary differences, to be generated by the Company’s wholly-owned taxable subsidiary over periods in which temporary differences become deductible and operating loss carryforwards expire, are sufficient such that it is more likely than not that the Company will realize the carrying amount of its deferred tax assets. As of December 31, 2022, the Partnership had gross federal net operating loss carryforwards of $1.9 million, which can be carried forward indefinitely, and $3.2 million of gross state net operating loss carryforwards expiring between 2026 and indefinite. As of December 31, 2022, the Partnership intends to indefinitely reinvest all cumulative undistributed earnings of foreign subsidiaries, and as such no U.S. federal or state income or foreign withholding taxes have been recorded. It is not practicable to determine the amount of the unrecognized deferred tax liability related to any undistributed foreign earnings. We recognize the tax benefits of an uncertain tax position only if those benefits are more likely than not to be sustained based on existing tax law. Unrecognized tax benefits are subsequently recognized at the time the more likely than not recognition threshold is met, the tax matter is effectively settled or the statute of limitations for the relevant taxing authority to examine and challenge the tax position has expired, whichever is earlier. We account for all interest and penalties on uncertain income tax positions as income tax expense. As of December 31, 2022, the Partnership had no unrecognized tax benefits. We file income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. The income tax returns for the taxable entities in the U.S. and India jurisdictions are open for examination and adjustment. As of December 31, 2022, the U. S. federal and state income tax returns are open for examination and adjustment for the years 2019 to 2022 and 2018 to 2022, respectively, and the India tax returns are open for examination and adjustment from 2019 to 2022. |
Partners' Capital
Partners' Capital | 12 Months Ended |
Dec. 31, 2022 | |
Partners' Capital | |
Partners' Capital | 12. Partners’ Capital Capital Contributions The Partnership was authorized As of December 31, 2022, there were 5,892.48 Class A Limited Partnership Units, 3,168.26 Class A-1 Limited Partnership Units, 2,955.88 Class B Limited Partnership Units and 1,604.25 Class B-1 Limited Partnership Units outstanding. As of December 31, 2021, there were 6,001.44 Class A Limited Partnership Units, 3,059.30 Class A-1Limited Partnership Units, 2,953.80 Class B Limited Partnership Units and 1,606.33 Class B-1 Limited Partnership Units outstanding. As of December 31, 2020, there were 5,999.38 Class A Limited Partnership Units, 3,061.36 Class A-1 Limited Partnership Units, 2,941.80 Class B Limited Partnership Units and 1,618.33 Class B-1Limited Partnership Units sent of the General Partner. The unit issuance fees for Class B and Class B-1 Limited Partners are different than the fees paid by Class A and Class A-1 Limited Partners. These fees are direct and incremental costs of raising capital from issued Units and are reflected as unit offering costs in the Consolidated Statements of Partners’ Capital. GPB H2 SLP, LLC, an affiliate of the General Partner, is entitled to receive a performance allocation from the Partnership as discussed below. Distributions After payment of any tax distributions and payment and reservation of all amounts deemed necessary by the General Partner in its sole discretion, the Partnership has generally made Class A and Class A-1 ordinary cash distributions at a rate of 8% of each Limited Partners’ adjusted Units per annum through 2018. Adjusted Units are calculated based on gross capital contributions of $50,000 less 11% selling fees equaling 1 adjusted unit. For example, if a Limited Partner subscribed into Class A for $50,000 with 11% selling fees with a net capital contribution of $44,500, that investor would receive a yearly distribution of $4,000. The calculation for this Limited Partner is 1 unit multiplied by the 8% distribution rate. A Class B and Class B-1 investor has received ordinary cash distributions at a rate of 8.7% of gross capital contributions. As of December 31, 2022 and through the date of this filing, none of the Limited Partners have reached the second tier of priority noted below (capitalized terms herein shall have the definition in accordance with the LPA and PPM). • First, 100% to the Limited Partners, in proportion to their respective Net Capital Contributions, until each Limited Partner has received cumulative distributions equal to such Limited Partners’ Net Capital Contribution Amount; • Second, 100% to the Limited Partners, in proportion to their respective Unreturned Capital Contributions, until each Limited Partner has received cumulative distributions equal to such Limited Partners’ aggregate Capital Contributions; • Third, 100% to the Limited Partners, in proportion to their respective Accrued Preferred Returns, until each Limited Partner has received cumulative distributions equal to the sum of such Limited Partners’ aggregate Capital Contributions and Limited Partner Preferred Return; • Fourth, 100% to the Special Partner until the cumulative distributions made to the Special Partner equal 20% of the sum of all amounts distributed to each Limited Partner in excess of such Limited Partners’ Net Capital Contribution Amount and to the Special Partner and; • Thereafter, 80% to the Limited Partners and 20% to the Special Partner, with such amounts distributed to the Limited Partners in proportion to their respective aggregate Capital Contributions. In the first quarter of 2019, the Partnership transitioned to a quarterly dynamic distribution rate, paid in arrears. The General Partner determines distribution amounts, if any, following the end of the calendar quarter, and will generally pay out any approved distributions prior to the end of the subsequent quarter. Distribution rates under this policy have historically fluctuated from quarter to quarter based on, among other things, the performance of the Partnership. As a result, Limited Partners should not expect future distribution rates to be the same as past ones. In accordance with the first step of the Partnership’s distribution waterfall, all of the Partnership’s distributions made to date have been a return of capital contributions made to the Partnership by investors. The source of these return of capital distributions have included, and may in the future continue to include, cash flow from operations and investor contributions. As of February 2021, all distributions need to be approved by the Monitor until further notice. During the year ended December 31, 2022 and 2021, there were state tax withholding distributions made on behalf of the Limited Partners of $2.1 million and $1.7 million, respectively. Net profits and net losses are allocated to the Limited Partners according to their capital accounts in a manner sufficient to cause each Limited Partners’ capital account to equal the amounts such Limited Partners would receive upon the liquidation of the Partnership. Net profits and net losses were determined on an accrual basis of accounting in accordance with U.S. GAAP. Redemptions As per the LPA and PPM, Limited Partners who have held their Units for at least one year may request that the Partnership repurchase all, but not less than all, of their Units. A Limited Partners’ ability to request a redemption may not be construed to mean a Limited Partner has any right to demand or receive the return of such Limited Partners’ capital contribution or otherwise modify any limitations under the PPM. The Partnership intends to redeem Units on a quarterly basis on the last business day of each calendar quarter and will not redeem in excess of 10% of the Units during any 12 all requests as of any calendar quarter end, then at such future time, if any, when sufficient funds become available in the General Partner’s sole discretion, pending requests will be honored among all requesting Limited Partners in accordance with their order of receipt. In August 2018, the General Partner suspended all redemptions. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 13. Commitments and Contingencies We, our General Partner, and our portfolio companies are involved in a number of regulatory, litigation, arbitration and other proceedings or investigations, many of which expose us to potential financial loss. We are advancing funds pursuant to indemnification clauses in the LPA, to officers and directors, as well as GPB, its principals, representatives, and affiliates, for any costs they may incur in connection with such disputes as required by various agreements or governing law. This advancing of funds does not cover any potential future indemnifiable outcomes or settlements that result from these disputes. We establish reserves or escrows for legal actions when potential losses associated with the actions become probable and the costs can be reasonably estimated. The actual costs of resolving legal actions may be substantially higher or lower than the amounts reserved or placed in escrow for those actions. Distributions may be delayed or withheld until such reserves are no longer needed or the escrow period expires. If liabilities exceed the amounts reserved or placed in escrow, Limited Partners may need to fund the difference by refunding some or all distributions previously received. In 2022, 2021, and 2020, the Partnership expensed $8.0 million, $4.0 million and $1.5 million, respectively, of legal indemnification expenses recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations. With respect to all significant litigation and regulatory matters facing us and our General Partner, we have considered the likelihood of an adverse outcome. It is possible that we could incur losses pertaining to these matters that may have a material adverse effect on our operational results, financial condition or liquidity in any future reporting period. We understand that the General Partner is currently paying legal costs associated with these actions for itself and certain indemnified parties. The Partnership expects to provide partial reimbursement to the General Partner as required by various agreements or governing law, but the amount is not reasonably estimable at this time. Regulatory and Governmental Matters GPB and certain of its principals and affiliates face various regulatory and governmental matters. GPB seeks to comply with all laws, rules, regulations and investigations into any potential or alleged violation of law. In such situations where GPB disagrees with the allegations made against it, GPB intends to vigorously defend itself in court. These matters could have a material adverse effect on GPB and the Partnership’s business, acquisitions, or results of operations. Appointment of Monitor and Application for Receivership On February 11, 2021, the EDNY Court in the SEC Action appointed the Monitor over GPB until further order of the Court. The EDNY Court appointed the Monitor in response to a request from the SEC, which asserted that the Monitor was necessary to protect investors in light of the alleged misconduct of GPB Capital’s former CEO, David Gentile. In its February 4, 2021 Complaint in the SEC Action, the SEC alleged that Mr. Gentile, as the owner and then-CEO of GPB Capital, along with Jeffry Schneider, the owner of GPB’s placement agent, lied to investors about the source of money used to make 8% annualized distribution payments to investors. According to the SEC, Mr. Gentile and others allegedly told investors that the distribution payments were paid exclusively with monies generated by GPB portfolio companies, but as alleged, GPB actually used investor money to pay portions of the annualized 8% distributions. The Complaint further contains allegations that Mr. Gentile and others manipulated financial statements of certain limited partnership funds that GPB manages to perpetuate the deception by giving the false appearance that the funds’ income was closer to generating sufficient income to cover the distribution payments than it actually was. Moreover, the Complaint alleges that Mr. Gentile engaged in undisclosed self-dealing, including by omitting from investor communications certain conflicts of interest and fees and other compensation that he received, totaling approximately $8.0 million. In support of the Order, the SEC contended that the Monitor would provide assurances to investors, GPB’s counterparties, and the public that an unbiased and qualified person who was not beholden to Mr. Gentile was vetting any significant transactions and decisions, and looking out for the interests of investors. Accordingly, pursuant to the Order, GPB shall (i) grant the Monitor access to all non-privileged books, records and account statements for the GPB-managed funds, including the Partnership, as well as their portfolio companies; and (ii) cooperate fully with requests by the Monitor reasonably calculated to fulfill the Monitor’s duties. As noted below, the Order was amended on April 14, 2021. The Monitor is required to assess the Partnership’s operations and business, and make recommendations to the EDNY Court, which may include continuation of GPB’s operations subject to the Monitorship, a liquidation of assets, or filing for reorganization in bankruptcy. The Order provides that the Monitor will remain in place until terminated by order of the EDNY Court, and grants the Monitor the authority to approve or disapprove proposed material corporate transactions by GPB, the Partnership and its subsidiaries, extensions of credit by them outside the ordinary course of business, decisions to make distributions to the Limited Partners of the Partnership, or any decision to file any bankruptcy or receiver petition for any of them, among other actions. The Monitor is not required to approve the issuance of the Consolidated Financial Statements included with this Form 10-K, nor has management sought or obtained approval from the Monitor. On April 14, 2021, the EDNY Court entered an Amended Order, providing that, in addition to the SEC and GPB, certain State regulators will receive access to the periodic reports filed by the Monitor pursuant to the Order. On May 31, 2022, Mr. Gentile filed a motion in the SEC Action to modify the Amended Order pursuant to Rule 60(b) of the Federal Rules of Civil Procedure. In his Rule 60(b) Motion, Mr. Gentile seeks a court order to, among other things, (i) narrow the scope of the Monitor’s responsibilities; and (ii) direct the Monitor to ensure that GPB does not sell or otherwise dispose of assets or portfolio companies that the Partnership owns before the completion of a “strategic assessment” to be conducted by three managers Mr. Gentile purportedly appointed to GPB on May 27, 2022. On that same day, May 31, 2022, the Monitor notified Mr. Gentile and GPB that Mr. Gentile’s purported appointment of three new managers to GPB without Monitor approval was, amongst other things, in violation of the Amended Order. Mr. Gentile and GPB were, at that time, given ten ( 10 On June 13, 2022, the SEC filed by Order to Show Cause in the SEC Action an application to (i) convert the existing Monitorship over GPB and the GPB-managed funds to a Receivership, and appoint the previously-appointed Monitor, Joseph T. Gardemal III, as Receiver; and (ii) impose a litigation injunction on cases filed against GPB and the GPB-managed funds. The Receivership Application and the Proposed Order were filed with the EDNY Court with consent of GPB’s management. The Receivership Application seeks appointment of Mr. Gardemal as Receiver in order to, in part, streamline the process by which GPB and the GPB-managed funds liquidate remaining portfolio company assets and distribute money to Limited Partners, subject to the EDNY Court’s supervision. The Proposed Order grants to Mr. Gardemal, generally, all powers and authorities previously possessed by the entities subject to the Proposed Order, as well as the powers possessed by the officers, directors, managers and others previously in charge of those entities, and permits him to, among other things, take all such actions necessary to preserve receivership assets. Additionally, the Receivership Application includes a proposed stay of all Federal and State actions (as well as any arbitrations) presently pending against GPB and the GPB-managed funds, and provides for a centralized claims process for GPB Limited Partners, in the EDNY Court, to prevent potentially disparate actions in different courts that could negatively impact the assets proposed to be subject to the EDNY Court’s jurisdiction and control. The Rule 60(b) Motion and the validity of the appointment of the new managers are presently under consideration by the EDNY Court, along with the Receivership Application. Currently, there can be no assurance as to the outcome of the Rule 60(b) Motion or the Receivership Application. Federal Matters On February 4, 2021, the SEC Action was filed against GPB, Ascendant, AAS, David Gentile, Jeffry Schneider and Jeffrey Lash in the EDNY Court. No GPB-managed partnership is a named defendant in the SEC Action. The SEC Action alleges several violations of the federal securities laws, including securities fraud. The SEC is seeking disgorgement and civil monetary penalties, among other remedies. Also, on February 4, 2021, the USAO brought the Criminal Case against Mr. Gentile, Mr. Schneider, and Mr. Lash. The indictment in the Criminal Case alleges conspiracy to commit securities fraud, conspiracy to commit wire fraud, and securities fraud against all three individuals. Mr. Gentile and Mr. Lash were also charged with two counts of wire fraud. We understand that the USAO intends to seek criminal forfeiture. Mr. Gentile resigned from all management and board positions with GPB and Highline, and the GPB-managed funds, including the Partnership, and subsidiaries of the Partnership, promptly following his indictment. State Matters On May 27, 2020, Massachusetts filed an Administrative Complaint against GPB for alleged violations of the Massachusetts Uniform Securities Act. No GPB-managed fund is a named defendant. The complaint alleges, among other things, that the offering documents for several GPB-managed funds, including the Partnership, included material misstatements or omissions. Massachusetts is seeking both monetary and administrative relief, including disgorgement and rescission to Massachusetts residents who purchased the GPB-managed funds. This matter is currently stayed, pending resolution of the Criminal Case. On February 4, 2021, seven state securities regulators (from Alabama, Georgia, Illinois, Missouri, New Jersey, New York, and South Carolina, collectively the “States”) each filed suit against GPB. No GPB-managed fund is a named defendant in any of the suits. Several of the suits also named Ascendant, AAS, Mr. Gentile, Mr. Schneider, and Mr. Lash as defendants. The States’ lawsuits allege, among other things, that the offering documents for several GPB-managed funds, including the Partnership, included material misstatements and omissions. The States are seeking both monetary and administrative relief, including disgorgement and rescission. The cases brought by the States have been stayed pending the conclusion of the related Criminal Case. The State of New Jersey has voluntarily dismissed its case, without prejudice to re-file it following the conclusion of the Criminal Case. Actions Asserted Against GPB and Others, Not Including the Partnership Ismo J. Ranssi, derivatively on behalf of Armada Waste Management, LP, v. GPB Capital Holdings, LLC, et al. (New York Supreme Court, New York County, Index No. 654059/2020) In August 2020, plaintiffs filed a derivative action against GPB, Ascendant Capital, AAS, Axiom, David Gentile, Mark D. Martino, and Jeffry Schneider in New York Supreme Court. GPB Waste Management, LP is named as a nominal defendant. The Partnership is not a named defendant. The Complaint alleges, among other things, that the offering documents for certain GPB managed funds include material misstatements and omissions. Plaintiffs bring causes of action against GPB for breach of fiduciary duty, breach of contract, unjust enrichment, and an equitable accounting, and against all other defendants for breach of fiduciary duty and aiding and abetting breach of fiduciary duty, and unjust enrichment. The plaintiffs seek a declaration from the Court that defendants breached duties owed to them, and that defendants must indemnify GPB Waste Management, LP for costs in connection with the suit. Plaintiffs also seek unspecified damages and an equitable accounting, and an Order that defendants disgorge all fees obtained through the sale of GPB Waste Management, LP “securities”. Any potential losses associated with this matter cannot be estimated at this time. Galen G. Miller and E. Ruth Miller, derivatively on behalf of GPB Holdings II, LP, v. GPB Capital Holdings, LLC, et al. (New York Supreme Court, New York County, Index No. 656982/2019) In November 2019, plaintiffs filed a derivative action against GPB, Ascendant, AAS, Axiom, Michael Cohn, Steven Frangioni, David Gentile, William Jacoby, Minchung Kgil, Mark D. Martino, and Jeffry Schneider in New York Supreme Court, New York County. The Partnership was named only as a nominal defendant. An Amended Complaint was filed on or about March 2, 2020, alleging, among other things, that the offering documents for certain GPB-managed funds include material misstatements and omissions. The Amended Complaint alleges causes of action for breach of fiduciary duty against all defendants; aiding and abetting breach of fiduciary duty against Ascendant, AAS, Axiom and Mr. Martino; breach of contract against GPB; unjust enrichment against all defendants; and an equitable accounting against GPB. The plaintiffs are seeking disgorgement of alleged unjust enrichment, unspecified damages as a result of alleged wrongful acts, costs of the action, and an equitable accounting. Any potential losses associated with this matter cannot be estimated at this time. GPB Lender, LLC v. GPB Capital Holdings, LLC (New York Supreme Court, Nassau County, Index No. 604887/2022) On or about April 14, 2022, plaintiff GPB Lender, LLC, a related entity, filed a lawsuit against GPB Capital Holdings, LLC in New York Supreme Court, Nassau County, for breaches of a promissory note and breaches of contract related to a 2016 loan agreement and a 2019 loan agreement entered into between the parties. Plaintiff alleged that it is owed approximately $2.0 million in unpaid principal and interest under the promissory note. Plaintiff also alleged that it is owed approximately $0.4 million in unpaid principal and interest under the two loan agreements. On January 30, 2023, the Court granted GPB Lender, LLC’s motion for summary judgment in the principal amount of approximately $2.5 million, plus interest. No costs are expected to be charged to the Partnership. Cient LLC v. GPB Capital Holdings, LLC (New York Supreme Court, Nassau County, Index No. 604886/2022) On or about April 14, 2022, plaintiff Cient LLC, a related entity, filed a lawsuit against GPB Capital Holdings, LLC in New York Supreme Court, Nassau County, for breach of a loan agreement and breach of contract relating to a 2019 loan agreement entered into by the parties. Plaintiff alleged that approximately $0.8 million in unpaid principal remains due, along with accrued and unpaid interest. On January 30, 2023, the Court granted Cient LLC’s motion for summary judgment in the principal amount of $0.9 million, plus interest. No costs are expected to be charged to the Partnership. Plymouth Rock Holding LLC v. GPB Capital Holdings, LLC (New York Supreme Court, Nassau County, Index No. 604873/2022) On or about April 14, 2022, plaintiff Plymouth Rock Holding, LLC, a related entity, filed a lawsuit against GPB Capital Holdings, LLC in New York Supreme Court, Nassau County, for breach of a loan agreement and breach of contract relating to a 2019 loan agreement entered into by the parties. Plaintiff alleged that approximately $0.3 million in unpaid principal remains due, along with accrued and unpaid interest. On January 30, 2023, the Court granted Plymouth Rock Holding LLC’s motion for summary judgment in the principal amount of $0.4 million, plus interest. No costs are expected to be charged to the Partnership. Actions Asserted Against GPB and Others, Including the Partnership For all matters below in which the Partnership is a defendant and where the partnership disagrees with the allegations against, we intend to vigorously defend against the allegations, however no assurances can be given that we will be successful in doing so. Tom Alberto, et al. v. GPB Capital Holdings, LLC, et al. (American Arbitration Association, Case Number: 01-22-0001-5433) On or about April 13, 2022, claimants, investors in Funds managed by GPB Capital Holdings, LLC, commenced an arbitration with the American Arbitration Association against GPB Capital Holdings, LLC, GPB Automotive Portfolio, LP, GPB Holdings II, LP, GPB Cold Storage, LP, GPB Holdings, LP, GPB Holdings II, LP, GPB Holdings Qualified, LP, GPB Holdings III, LP, GPB NYC Development, LP, and GPB Waste Management, LP, along with other non-GPB parties. All claimants were customers of Concorde Investment Services, LLC (“Concorde”), and each purchased his or her limited partnership interest in a GPB-managed Fund through Concorde. Claimants asserted claims based on fraud, breach of fiduciary duty, breach of contract, among others, and claimed to have suffered millions of dollars in damages. GPB contended that the arbitration was improperly filed, and as such commenced a proceeding in New York State Supreme Court (GPB Capital Holdings, LLC et al. v. Tom Alberto et al., Index No. 656432/2022), solely for the purpose of seeking a stay of the arbitration. In July 2022, following the Court’s entry of an Order temporarily staying the arbitration, the parties stipulated and agreed to the entry of a court order entering judgment for GPB and the other petitioners. The arbitration will be permanently stayed upon the Court so-ordering the parties stipulation. In a letter dated December 20, 2022, the American Arbitration Association informed the parties to the arbitration that, as of December 20, 2022, the arbitration was closed. Michael Peirce, derivatively on behalf of GPB Automotive Portfolio, LP v. GPB Capital Holdings, LLC, Ascendant Capital, LLC, Ascendant Alternative Strategies, LLC, Axiom Capital Management, Inc., Steven Frangioni, David Gentile, William Jacoby, Minchung Kgil, Mark D. Martino and Jeffry Schneider, -and- GPB Automotive Portfolio, LP, Nominal Defendant (New York Supreme Court, New York County, Case No. 652858/2020) In July 2020, plaintiff filed a derivative action in New York Supreme Court against GPB, Ascendant, AAS, Axiom, Steve Frangioni, David Gentile, William Jacoby, Minchung Kgil, Mark Martino, and Jeffry Schneider. The Complaint alleges various breaches of fiduciary duty and/or aiding and abetting the breaches of fiduciary duty against all defendants, breach of contract against GPB, unjust enrichment, and an equitable accounting. Plaintiffs are seeking declaratory relief, disgorgement, restitution, an equitable accounting, and unspecified damages. Any potential losses associated with this matter cannot be estimated at this time. Alfredo J. Martinez, et al. v. GPB Capital Holdings, LLC (Delaware Chancery Court, Case No. 2019-1005) In December 2019, plaintiffs filed a civil action in Delaware Court of Chancery to compel inspection books and records from GPB, as General Partner, and from the Partnership, GPB Holdings I, GPB Automotive Portfolio, LP, and GPB Waste Management. In June 2020, the court dismissed plaintiffs’ books and records request, but allowed a contract claim for specific performance to proceed as a plenary action. The plaintiffs are seeking unspecified damages and penalties. Any potential losses associated with this matter cannot be estimated at this time. Alfredo J. Martinez and HighTower Advisors v. GPB Capital Holdings, LLC, et al. (Delaware Chancery Court, Case No. 2020-0545) In July 2020, plaintiff filed a complaint against GPB, Armada Waste Management GP, LLC, Armada Waste Management, LP, the Partnership, GPB Automotive Portfolio, LP, and GPB Holdings, LP in the Delaware Court of Chancery to compel inspection of GPB’s books and records based upon specious and unsubstantiated allegations regarding alleged fraudulent activity, mismanagement, and breaches of fiduciary duty. The plaintiffs are seeking an order compelling GPB to permit inspection of documents related to Armada Waste, as well as for costs and fees. Any potential losses associated with this matter cannot be estimated at this time. Lance Cotten, Alex Vavas and Eric Molbegat v. GPB Capital Holdings, LLC, Automile Holdings LLC D/B/A Prime Automotive Group, David Gentile, David Rosenberg, Philip Delzotta, Joseph Delzotta, and any other related entities (New York Supreme Court, Nassau County, Case No. 604943/2020) In May 2020, plaintiffs filed a civil action in New York Supreme Court, Nassau County, against GPB, Automile Holdings LLC d/b/a Prime Automotive Group, David Gentile, David Rosenberg, Philip Delzotta, Joseph Delzotta, and other related entities. The Complaint alleges that defendants engaged in systematic fraudulent and discriminatory schemes against customers and engaged in retaliatory actions against plaintiffs, who were employed by Garden City Nissan from August until October 2019. The plaintiffs are seeking damages pursuant to New York Labor Law Section 740, which provides for compensation for lost wages, benefits, and other remuneration, and liquidated damages for alleged violations of Executive Law Section 296. No costs associated with the resolution of this matter are expected to be charged to the Partnership. Monica Ortiz, on behalf of herself and other individuals similarly situated v. GPB Capital Holdings LLC; Automile Holdings, LLC d/b/a Prime Automotive Group; David Gentile; David Rosenberg; Philip Delzotta; Joseph Delzotta; and other affiliated entities and individuals (New York Supreme Court, Nassau County, Case No. 604918/2020) In May 2020, plaintiffs filed a class action in New York Supreme Court, Nassau County, against GPB, Automile Holdings LLC d/b/a Prime Automotive Group, David Gentile, David Rosenberg, Philip Delzotta, Joseph Delzotta, and other affiliated entities and individuals. In November 2020, the plaintiffs voluntarily discontinued the action only as against David Rosenberg. The Complaint alleges deceptive and misleading business practices of the named Defendants with respect to the marketing, sale, and/or leasing of automobiles and the financial and credit products related to the same throughout the State of New York. Plaintiffs allege defendants’ collection of fraudulent rebates exceeds $1,000,000. The plaintiffs are seeking class-wide injunctive relief requiring defendant dealerships to disclose financing options, rebates, interest rates, and risk of repossession; monetary and punitive damages for violation of New York General Business Laws, unjust enrichment, negligent misrepresentation, and breach of contract; and also seek costs and fees. Any potential losses associated with this matter cannot be estimated at this time. In re: GPB Capital Holdings, LLC Litigation (formerly, Adam Younker, Dennis and Cheryl Schneider, Elizabeth Plaza, and Plaza Professional Center Inc. PFT Sharing v. GPB Capital Holdings, LLC, et al. and Peter G. Golder, individually and on behalf of all others similarly situated, v. GPB Capital Holdings, LLC, et al. (New York Supreme Court, New York County, Case No. 157679/2019) In May 2020, plaintiffs filed a consolidated class action complaint in New York Supreme Court, New York County, against GPB, GPB Holdings, GPB Holdings II, GPB Holdings III, the Partnership, GPB Cold Storage, GPB Waste Management, David Gentile, Jeffrey Lash, Macrina Kgil, a/k/a Minchung Kgil, William Edward Jacoby, Scott Naugle, Jeffry Schneider, AAS, Ascendant, and Axiom Capital Management. The Complaint alleges, among other things, that the offering documents for certain GPB-managed funds, include material misstatements and omissions. The plaintiffs are seeking disgorgement, unspecified damages, and other equitable relief. Any potential losses associated with this matter cannot be estimated at this time. Phillip J. Cadez, et al. v. GPB Capital Holdings, LLC, et al. (Delaware Chancery Court, Case No. 2020-0402) In May 2020, plaintiffs filed a derivative action in Delaware Court of Chancery against GPB, David Gentile, Jeffrey Lash, and Jeffry Schneider. The complaint also names GPB Holdings, LP, and the Partnership as nominal defendants. Previously, plaintiffs had filed a complaint to compel inspection of books and records, which had been dismissed without prejudice. In the current action, plaintiffs are alleging breaches of fiduciary duties and/or the aiding and abetting of those breaches, unjust enrichment, and with regard to GPB, breach of the Partnerships’ Limited Partnership Agreements. Plaintiffs are seeking unspecified damages based on the causes of action pled, equitable relief in the form of a directive to remove GPB as the General Partner of GPB Holdings, LP and the Partnership, a constructive trust, costs of the action (including attorneys’ fees), and other declaratory and equitable relief. Any potential losses associated with this matter cannot be estimated at this time. Jeff Lipman and Carol Lipman, derivatively on behalf of GPB Holdings II, LP and GPB Automotive Portfolio, LP v. GPB Capital Holdings, LLC, et al. (Delaware Chancery Court, Case No. 2020-0054) In January 2020, plaintiffs filed a derivative action in Delaware Court of Chancery against GPB, David Gentile, Jeffrey Lash, and Jeffry Schneider. The complaint alleges breaches of fiduciary duty and/or aiding and abetting breaches of fiduciary duty against each of the defendants, and declaratory relief from the Court related to allegations of fraud, gross negligence, and willful misconduct. The plaintiffs seek unspecified damages and declaratory forms of relief. Any potential losses associated with this matter cannot be estimated at this time. Mary Purcell, et al. v. GPB Holdings II, LP, et al. (Cal. Supreme Court, Orange County, Case No. 30-2019-01115653-CU-FR-CJC) In December 2019, plaintiffs filed a civil action in Superior Court in Orange County, California against Rodney Potratz, FSC Securities Corporation, GPB Automotive Portfolio, LP, the Partnership, GPB, David Gentile, Roger Anscher, William Jacoby, Jeffrey Lash, Ascendant, Trevor Carney, Jeffry Schneider, and DOES 1 - 15, inclusive. An Amended Complaint was filed on or about June 10, 2020. In the Amended Complaint, Plaintiffs allege breach of contract against GPB Capital and DOES 1-15, inclusive; statutory and common law fraud against all defendants; breach of fiduciary duty against all defendants; and negligence against all defendants. Plaintiffs allege losses in excess of $4.8 million and are seeking rescission, compensatory damages, unspecified equitable relief and punitive damages, and interest and attorneys’ fees in unspecified amounts. Any potential losses associated with this matter cannot be estimated at this time. Barbara Deluca and Drew R. Naylor, on behalf of themselves and other similarly situated Limited Partners, v. GPB Automotive Portfolio, LP et al. (S.D.N.Y., Case No. 19-CV-10498) In November 2019, plaintiffs filed a putative class action complaint in the United States District Court for the Southern District of New York against GPB, GPB Automotive Portfolio, LP, the Partnership, David Gentile, Jeffery Lash, AAS, Axiom, Jeffry Schneider, Mark Martino, and Ascendant. The Complaint alleges fraud and material omissions and misrepresentations to induce investment and losses in excess of $1.27 billion. The plaintiffs are seeking disgorgement, compensatory, consequential, and general damages; disgorgement; rescission; restitution; punitive damages; and the establishment of a constructive trust. Any potential losses associated with this matter cannot be estimated at this time. Kinnie Ma Individual Retirement Account, et al., individually and on behalf of all others similarly situated, v. Ascendant Capital, LLC, et al. (W.D. Texas, Case No. 19-cv-01050) In October 2019, plaintiffs filed a putative class action in the United States District Court for the Western District of Texas against GPB, certain GPB-managed limited partnerships, including the Partnership, for which GPB is the General Partner, AAS, and Ascendant, as well as certain principals of the GPB-managed limited partnerships, auditors, broker-dealers, a fund administrator, and other individuals. The Complaint alleges violations and/or aiding and abetting violations of the Texas Securities Act, fraud, substantial assistance in the commission of fraud, breach of fiduciary duty, substantial assistance in breach of fiduciary duty, and negligence. Plaintiffs allege losses in excess of $1.8 billion and are seeking compensatory damages in an unspecified amount, rescission, fees and costs, and class certification. Any potential losses associated with this matter cannot be estimated at this time. On June 1, 2022, the Western District of Texas Court consolidated this matter with Barasch v. GPB Capital, et al. Kinnie Ma U.S. v. Gentile, et al. Stanley S. and Millicent R. Barasch Trust and Loretta Dehay, individually and on behalf of others similar situated v. GPB Capital Holdings, LLC, et al. (W.D. Texas, Case No. 19 Civ. 01079) In November 2019, plaintiffs filed a putative class action in the United States District Court for the Western District of Texas against, the Partnership and other GPB-managed limited partnerships, AAS, and Ascendant, as well as certain principals of the GPB-managed funds, auditors, a fund administrator, and individuals. (The original Complaint named Millicent R. Barasch as the plaintiff, but since her death, her trust has successfully moved to substitute for all purposes in this litigation.) The Complaint alleges civil conspiracy, fraud, substantial assistance in the commission of fraud, breach of fiduciary duty, substantial assistance in the breach of fiduciary duty, negligence, violations of the Texas Securities Act, and aiding and abetting violations of the Texas Securities Act. Plaintiffs allege losses in excess of $1.8 billion and are seeking compensatory and other unspecified damages, declaratory relief, rescission, and costs and fees. Any potential losses associated with this matter cannot be estimated at this time. On June 1, 2022, the Western District of Texas Court consolidated this matter into Kinnie Ma v. Ascendant Capital, LLC et al. (19-cv-01050). The claims at issue in this case continue under the Kinnie Ma docket number. Concorde Investment Services, LLC v. GPB Capital Holdings, LLC, et al. (New York Supreme Court, New York County, Index No. 650928/2021) In February 2021, Concorde Investment Services, LLC filed suit in New York State Supreme Court, New York County, against GPB, certain limited partnerships for which GPB is the General Partner, and others. The Complaint alleges breaches of contract, fraudulent inducement, negligence, interference with contract, interference with existing economic relations, interference with prospective economic advantage, indemnity, and declaratory relief, and includes a demand for arbitration. Plaintiff’s demands include compensatory damages of at least $5.0 million, punitive damages, and a declaration that Concorde is contractually indemnified by the Defendants. In October 2021, the Supreme Court ordered the action be stayed so that the Plaintiffs could pursue claims in arbitration. By the same Order, the Court denied the Defendants’ motions to dismiss the Complaint. Any potential losses associated with this action cannot be estimated at this time. Jeffry Schneider v. GPB Capital Holdings, LLC et al., Case No. 2021-0963 (Court of Chancery, DE) In November 2021, Plaintiff, a former affiliate of GPB Capital Holdings, LLC, filed a Complaint in Chancery Court in Delaware against GPB Capital Holdings, LLC and each of the funds it manages, including the Partnership, seeking a ruling that he is contractually entitled to mandatory advancement of legal fees by GPB Capital with respect to several lawsuits in which Plaintiff is named. On March 24, 2022, the Chancery Court issued a bench ruling, finding that Plaintiff was entitled to advancement of his legal fees from GPB Capital. Any potential losses associated with this action |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions | |
Related Party Transactions | 14. Related Party Transactions FEES AND EXPENSES The Partnership has entered into numerous related party transactions. The Partnership incurred the following fees and expenses: Managerial Assistance Fee Per the LPA and PPM, GPB, as General Partner, is entitled to receive an annualized managerial assistance fee, for providing managerial assistance services to the Partnership and its portfolio companies and equity method investees. Those services include conducting the day-to-day operations of the Partnership inclusive of the identification, management and disposition of underlying portfolio companies and other duties assumed and stated under the LPA. The Managerial Assistance Fee does not include expenses related to In-House Services and Operations Support Services provided to the Partnership or its portfolio companies and equity method investees. Such expenses are in addition to, and not in lieu of, the Managerial Assistance Fee. The Managerial Assistance Fee is payable by the Partnership quarterly in advance of 2.0% per annum for Class A and B B-1 Partnership Expenses The Partnership pays its own operating expenses. GPB is responsible for its or its affiliates’ general and administrative costs and expenses and its day to day overhead expenses of managing the Partnership and is not entitled to be reimbursed by the Partnership for such expenses other than for the portion of the total compensation of GBP’s or its affiliates (including holding companies), officers and employees relating to the time such officers or employees provide In-House Services or Operations Support Services to the Partnership or its investee entities. Such expenses are in addition to, and not in lieu of, the Managerial Assistance Fee. “In-House Services” include but are not limited to accounting, legal, compliance, information technology, human resources, and operational and management services to the Partnership or the investee entities. “Operations Support Services” include, but are not limited to, operational support and consulting services and similar services to, or in connection with, the identification, acquisition, holding and improvement of the investee entities. In addition GPB has, on occasion, paid Partnership expenses on the Partnerships’ behalf. Upon request from GPB, the Partnership reimburses GPB in full for all of the expenses paid on its behalf. Partnership expenses included as a component of selling, general and administrative expenses in the Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020, were $12.4 million, $7.0 million and $3.2 million, respectively. As of December 31, 2022 and December 31, 2021, respectively, the Partnership has non-interest-bearing payables of nil and $0.2 million, to GPB for these expenses, which are included in amounts due to related parties in the Consolidated Balance Sheets. NOTES RECEIVABLE FROM RELATED PARTIES In February 2016, the Partnership entered into a loan agreement with Quantum, an equity method investee. This “interest only” loan bore interest at 4% per annum through 2017 and 8% per annum through March 2022. Subsequent repayments and additional lending resulted in a loan balance of $0.5 million at December 31, 2020. During the years ended December 31, 2022, 2021 and 2020, payments of $0.1 million, $0.4 million and $0.2 million, respectively, were received. As of December 31, 2022, 2021 and, 2021, the outstanding note receivable balance was nil and $0.1 million, respectively, which was included in note receivable – related party in the Consolidated Balance Sheets. During 2019, the Partnership loaned Quantum $0.8 million under an additional loan agreement to be used for purposes of closing their Florida office. The loan had a 36 NOTES PAYABLE TO RELATED PARTIES In 2017 a term loan agreement was entered into by Project Halo of which Meta HealthCare IT Solutions, LLC and Cantata were co-borrowers, with Rural India Supporting Trust (“RIST”), a company that controls a board seat of Halo. As of December 31, 2019, the principal outstanding was $13.0 million. Interest-only payments accrued at an annual rate of 10.0% for 36 months from the effective date of June 2017. In September 2020, Halo entered into the First Amendment to Intercreditor Agreement with RIST which required Halo to pay down $6.5 million of its outstanding debt obligation and extended the maturity date of the term loan to December 31, 2022.The amended term loan accrued interest at a rate of 10% with all outstanding principal due at maturity. The loan agreement contained certain financial and non-financial covenants. On February 24, 2022, the Partnership paid off the RIST loan principal and outstanding interest on behalf of the borrowers. As of December 31, 2022 and 2021, the outstanding note payable balance, including accrued interest, was nil and $6.5 million, respectively, which was included in note payable - related party in the Consolidated Balance Sheets. For the years ended December 31, 2022, 2021 and 2020, interest expense related to these notes were $0.1 million, $0.7 million and $1.3 million, respectively, included in interest expense to related parties in the Consolidated Statement of Operations. DUE TO AFFILIATED COMPANIES Commencing during 2018, the Partnership was subject to allocated expenses from GPB Prime, an affiliated entity that runs GPB’s automotive strategy across all entities in the GPB fund complex. This arrangement ended in November 2021 when the automotive dealerships were sold. For the years ended December 31, 2021 and 2020, the Partnership recorded general and administrative expenses related to this allocation of $2.2 million and $1.9 million, respectively, which is included in selling, general and administrative expenses in the Consolidated Statements of Operations. CONSULTING AGREEMENTS For the years ended December 31, 2022, 2021 and 2020, respectively, Erus paid $0.2 million, $0.2 million and $0.2 million, respectively, for consulting fees to a non-controlling interest member of Erus, who was also previously a member of Erus’ management. The consulting fees are recorded in selling, general and administrative expenses in the Consolidated Statements of Operations. Greenwave, a subsidiary of the Partnership until January 2022, incurred related-party expenses of $0.3 million and $0.3 million for the years ended December 31, 2021 and 2020, respectively. These expenses were recorded in selling, general and administrative expenses in the Consolidated Statements of Operations. The expenses were related to the provision of services from a company owned by the CEO of the subsidiary. Quantum, an equity method investee of the Partnership, incurred expenses of $0.8 million, $0.4 million and $0.7 million for the years ended December 31, 2022, 2021 and 2020, respectively. The expenses were related to the provision of consulting services from several companies owned by officers of the subsidiary. Accounts payable related to these services were $0.2 million and $0.8 million, as of December 31, 2022 and 2021, respectively. OTHER RELATED PARTY TRANSACTIONS For the years ended December 31, 2021 and 2020, certain automobile dealerships owned by the Partnership purchased vehicles from dealerships owned by AP LP totaling $1.1 million and $0.5 million, respectively. For the years ended December 31, 2021 and 2020, certain automobile dealerships owned by the Partnership sold vehicles to dealerships owned by AP LP totaling $1.5 million, $1.7 million, respectively. For the years ended December 31, 2022 and 2021, respectively, Erus paid $0.6 million and $0.3 million to Reimagine Roofing, a company affiliated with one of the Erus’ senior executives. These fees are included in cost of services in the Consolidated Statements of Operations. Erus occasionally sells customer accounts to an entity controlled by a non-controlling interest member of Erus, who is a member of the subsidiary’s management. For the years ended December 31, 2022, 2021 and 2020, respectively, the amounts sold were $0.8 million, $0.5 million and $0.4 million, respectively, which are included in product revenue in the Consolidated Statements of Operations. HPI, a subsidiary of the Partnership, entered into sales transactions with a company controlled by a director of the subsidiary. Revenues related to this relationship were $5.3 million, $6.3 million and $5.0 million for the years ended December 31, 2022, 2021 and 2020, respectively. These revenues were included in service revenue in Consolidated Statements of Operations. Accounts receivable were $0.5 million and $0.6 million, as of December 31, 2022 and 2021, respectively and are included in accounts receivable, net on the Consolidated Balance Sheets. As compensation for the services to be rendered by Highline, the Partnership pays GPB’s Operation Service Provider (“OSP”) fees to Highline for an annual amount agreed to by GPB and Highline, subject to the Highline Board’s approval, following Highline’s delivery of the annual written budget to GPB detailing the fees, costs and expenses that will be incurred by Highline in providing its Services. The Partnership recorded OSP fees as a component of selling, general and administrative expenses in the Consolidated Statements of Operations of $1.4 million, $5.3 million and $1.4 million for the years ended December 31, 2022, 2021 and 2020, respectively. On July 18, 2022, HPI Holdings LLC (“HPI Holdings”) entered into an agreement to acquire 100% of the outstanding shares of MDS for cash consideration of $13.5 million net of $0.5 million to be paid to a non-controlling shareholder. Transaction costs were $0.3 million. At the consummation of the transaction, the assets and liabilities of MDS were recorded on HPI’s books at their respective carrying values. No gain or loss was recorded in connection with the transaction as MDS and HPI Holdings were both under common control of the Partnership prior to and after the consummation of the transaction. MDS is included in the HPI Holdings reporting unit. See “Note 4. Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale” The partnership and non-controlling shareholder executed a contribution agreement in connection with the acquisition, which states that the non-controlling shareholder will receive eight quarterly installments of $63 thousand starting in July 2022. During the year ended December 31, 2022 two payments were made. As of December 31, 2022, the outstanding payable balance was $0.4 million, which is included in amounts due to related parties in the Consolidated Balance Sheets. Quantum leases space from an officer of the company. Quantum paid rent for the years ended December 31, 2022, 2021 and 2020 of $0.2 million during each year. In 2021 and 2020 HPI, MDS and Experience Care entered into a number of agreements as a vendor and customer with its related party Itelagen. For the years ended December 31, 2021 and 2020, respectively, ITelagen, paid $0.3 million and $0.6 million for revenue cycle management services, which are included in service revenue in the Consolidated Statements of Operations. For the years ended December 31, 2021 and 2020, respectively, ITelagen provided IT services of $0.3 million and $1.2 million. These costs are included in selling, general and administrative expense in the Consolidated Statements of Operations. There were no receivables or payables due from/to the Partnership as of December 31, 2021. |
Business Segments
Business Segments | 12 Months Ended |
Dec. 31, 2022 | |
Business Segments | |
Business Segments | 15. Business Segments ASC 280, Segment Reporting, requires use of the management approach model for segment reporting, which considers how management organizes segments within the Partnership to allocate resources, make operating decisions and assess performance. The reportable segments are among the business activities of the Partnership for which discrete financial information is available and for which operating results are regularly reviewed by its chief operating decision maker. The Partnership’s chief operating decision maker is its Chief Executive Officer. Management deems operating segments that exceed certain quantitative thresholds to be reportable segments. Our segments coincide with how our businesses are managed. As of December 31, 2022, the Partnership has the following reportable segments: ● Technology-Enabled Services; ● Energy and ● Corporate and Other. The last segment, which we refer to as “Corporate and Other,” primarily consists of other operating segments that are not reportable under the quantitative thresholds, or are selling, general and administrative expenses of Corporate. Segment results incorporate the revenues and expenses of consolidated subsidiaries from the date of acquisition. Reportable segments’ financial data were as follows: Technology Enabled Corporate (Dollars in thousands) Services Energy and Other Total 2022 Revenue $ 124,068 $ 68,922 $ (1,841) $ 191,149 Loss (income) from equity method investments 4,010 2,885 (118) 6,777 Gain on disposal of businesses — (4,424) (2,299) (6,723) Depreciation and amortization 14,645 529 — 15,174 Operating income (loss) (854) 2,216 (26,540) (25,178) Gain on sale of discontinued operations — — 7,919 7,919 Expenditures for long-lived assets (1,166) (388) — (1,554) Total assets 213,672 47,330 341,173 602,175 2021 Revenue $ 91,730 $ 57,563 $ 4,066 $ 153,359 Income from equity method investments (672) (2,263) (514) (3,449) Loss on disposal of businesses — — 5,334 5,334 Depreciation and amortization 9,758 480 64 10,302 Operating income (loss) 2,984 3,702 (40,302) (33,616) Gain on sale of discontinued operations — — 176,799 176,799 Expenditures for long-lived assets (928) (727) (3,667) (5,322) Total assets 219,810 60,641 423,095 703,546 2020 Revenue $ 76,192 $ 39,490 $ 3,534 $ 119,216 (Income) loss from equity method investments 114 (327) (213) (426) Impairment of goodwill, intangibles and other assets 780 — — 780 Depreciation and amortization 8,285 401 31 8,717 Operating income (loss) 2,996 2,744 (24,227) (18,487) Gain on sale of discontinued operations — — 31,806 31,806 Expenditures for long-lived assets (912) (510) (5,854) (7,276) Total assets 126,627 44,288 369,606 540,521 Operating segments do not sell products to each other; however, several of the portfolio companies in the Technology-Enabled Services segment paid management fees to the Corporate and Other operating segment for services performed by Corporate. These fees have been eliminated from the respective segment information above. |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent events | |
Subsequent events | 16. Subsequent events On January 6, 2023 HPI Holdings entered into an agreement to purchase substantially all of the assets of ALN Management Company, LLC (“ALN”) a provider of RCM and business related management services for $21.9 million. ALN will be included in the HPI Holdings reporting unit. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Consolidated Financial Statements through December 31, 2022, have been prepared in accordance with U.S. GAAP assuming the Partnership will continue as a going concern. |
Principles of Consolidation and Equity Method | Principles of Consolidation and Equity Method The Consolidated Financial Statements include the accounts of the Partnership and its subsidiaries in which it has a controlling interest. Intercompany accounts and transactions have been eliminated in consolidation. Our strategy in the segments in which we choose to participate is to invest in and operate income producing, middle market private companies primarily in North America. We focus on owning and operating portfolio companies on a long-term basis with a goal of maximizing returns for our investors by improving operational performance, and in turn, increasing the value. We strive to create long-term value and generate cash flow from operations for our Limited Partners by building industry-leading companies. To accomplish our objectives, we acquire controlling interests in operating companies and provide managerial expertise and investment capital to develop the operations and enhance the overall value of the business. In other situations, we acquire equity that affords us the ability to exercise significant influence over the business without a controlling stake. For this reason, we classify the earnings from our investments in entities where we have the ability to exercise significant influence as a component of operating income in our Consolidated Statements of Operations. Consolidation Method. The Partnership has a controlling interest when it owns a majority of the voting interest in an entity or when it is the primary beneficiary of a variable interest entity (“VIE”). A VIE is an entity in which the equity investment holders have not contributed sufficient capital to finance its activities or the equity investment holders do not have defined rights and obligations normally associated with an equity investment. The primary beneficiary is the party who has both the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and an obligation to absorb losses of the entity or a right to receive benefits from the entity that could potentially be significant to the entity. When determining which enterprise is the primary beneficiary, management considers (i) the entity’s purpose and design, (ii) which variable interest holder has the power to direct the activities that most significantly impact the entity’s economic performance, and (iii) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. When certain events occur, the Partnership reconsiders whether it is the primary beneficiary of that VIE. VIE’s are consolidated by the primary beneficiary. Non-Controlling Interests Non-controlling interests represent the portion of net assets in consolidated entities that are not owned by the Partnership. When the Partnership acquires a controlling interest in a consolidated entity, the non-controlling interest is initially recorded at fair value and subsequently adjusted for any capital transactions between the third-party investors and the consolidated entity that occur during the period and by net income (loss) attributable to non-controlling interests. Equity Method. The Partnership accounts for investment in companies where it does not exercise control and whose results are not consolidated, over which it is able to exercise significant influence under the equity method. Significant influence is generally considered to exist when our ownership interest in the voting stock of the investee is within quantitative guidance, although other factors, such as representation on the investee’s board of directors and the impact of commercial arrangements, are also considered in determining whether the equity method of accounting is appropriate. Under the equity method of accounting, the investments are initially recorded at cost and subsequently adjusted by the Partnership’s proportionate share of the investee’s net income or losses and any dividend distributions. We record contributions and distributions as an increase or decrease in the carrying value of the investment, respectively. When the Company’s interest in an equity method investment company is reduced to zero, the Company records no further losses in its Consolidated Statements of Operations unless the Company has an outstanding guarantee obligation or has committed additional funding to such equity method investment company. When such equity method investment company subsequently reports income, the Company will not record its share of such income until it exceeds the amount of the Company’s share of losses not previously recognized. The Partnership also evaluates the equity method investments for potential impairment whenever events or changes in circumstances indicate that there is an other than temporary decline in value of the investment. Such events include, but are not limited to, sustained operating losses by the investee or long‑term negative changes in the investee’s industry and sales of ownership interests at prices below our carrying value of our investment. During the year ended December 31, 2022, $8.0 million in impairment charges were recorded in loss from equity method investments on the Consolidated Statement of Operations, there were no impairment charges for the years ended December 31, 2021 and 2020. The impairment charge at Hotel Internet Services, Inc. (“HIS”) was the result of a permanent degradation in expected future operating performance and cash flows due to the loss of a primary revenue source. The loss of the primary revenue source is a direct result of the cessation of the manufacture of a technology component used in the delivery of the internet services for which a cost-effective alternative is not presently available. The charge at Quantum Energy Holdings, LLC (“Quantum”) was the result of the culmination of deterioration in the Company’s customer base and the Company’s decision not to expand into new markets due to excessive migration costs both of which are considered to be permanent in nature. |
Use of Estimates | Use of Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The actual results could differ from the estimates and assumptions made in the preparation of the accompanying Consolidated Financial Statements. The significant estimates made by management in the accompanying Consolidated Financial Statements relate to the fair value of assets acquired and liabilities assumed in business combinations, the valuation of goodwill and intangibles, reserves for potential litigation liabilities, depreciable lives, valuation of long-lived assets, and valuation of investments securities and equity method investments. |
Business Combinations | Business Combinations The Partnership accounts for acquisitions in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations. ASC 805 provides guidance for recognition and measurement of identifiable assets and goodwill acquired, liabilities assumed, and any non-controlling interest in the acquiree at fair value. In a business combination, the net assets acquired, liabilities assumed and non-controlling interest in the acquired businesses are recorded as of the date of acquisition at their respective fair values. Any excess of the purchase price (consideration transferred) over the estimated fair values of net assets and identifiable intangible assets acquired is recorded as goodwill. Transaction costs are expensed when incurred. The operating results of the acquired businesses are reflected in our Consolidated Financial Statements commencing on the date of the acquisition. The Partnership records the net assets of acquired businesses at fair value, based, in part, upon internal estimates of cash flows and independent appraisals. Changes to the assumptions used to estimate the fair value could impact the recorded amounts of the net assets acquired and the resultant goodwill. Fair values of customer relationships are estimated by discounting expected future cash flows of the customers. Developed technology and tradenames are estimated using the relief from royalty method by estimating the savings attributable to having purchased the asset. Software platforms are valued at replacement cost and non-compete agreements are estimated using the with and without method that compares the prospective cash flows with and without the non-compete agreement in place. The fair value of real property is determined using a combination of the cost approach (the comparative unit method) and sales comparison approach (the building residual technique method). |
Cash, Cash Equivalents and Restricted Cash | Cash and Cash Equivalents Cash and cash equivalents includes cash on hand, cash in bank accounts without restriction, and investments in Treasury Bills with original maturities of no longer than three months. The Partnership maintains cash balances with financial institutions that, at times, may exceed federally insured limits. Management periodically evaluates the creditworthiness of these institutions and has not experienced any losses on such deposits. As of December 31, 2022, the standard Federal Deposit Insurance Corporation (FDIC) insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per ownership category. Any deposit in excess of this insured amount could be lost. As of December 31, 2022, substantially all of the Partnership’s $30.1 million of deposited cash held in banks was in excess of the FDIC coverage limit. As of December 31, 2022, $304.3 million was invested in Treasury Bills, with original maturities of no longer than three months, are not presented in the table above. The Partnership uses Signature Bank for the majority of its banking. On March 12, 2023 the FDIC appointed the New York State Department of Financial Services as a receiver for Signature Bank and subsequently closed the bank. To protect the customers, substantially all of the deposits were moved to Signature Bridge Bank, N.A that will be a full service bank during a transition to a new permanent bank. GPB does not believe this will have a material impact on the financial statements of the Partnership, however, no assurance can be provided. As of December 31, 2022 the Partnership had $20.9 million of cash deposits at Signature Bank. Restricted Cash As of December 31, 2022, the Partnership held $18.2 million of total |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable primarily consist of trade receivables from customers, which are paid by customers and financing companies (Energy). Receivables are recorded at the invoiced amount or the amount expected to be received under contractual agreements. The Partnership maintains an allowance for doubtful accounts for estimated losses inherent in its accounts receivable. In establishing the required allowance, management considers payor terms, historical losses, current market conditions and customers’ financial condition, the amount of receivables in dispute, the current receivables aging and current payment patterns. Past due balances over 90 days are reviewed for collectability. Accounts receivable are written off against allowances after all reasonable collection efforts are exhausted. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation, or at the estimated fair value at the date of acquisition for property and equipment purchased in connection with a business combination. Property and equipment under capital leases are stated at the lower of the present value of minimum lease payments or the fair value of the asset at the inception of the lease, net of accumulated depreciation. Major additions and improvements which extend the useful lives of the assets are capitalized, while minor replacements, repairs, and maintenance, which do not improve or extend the lives of the assets, are expensed as incurred. Once the assets are placed into service, they are depreciated in accordance with the Partnership’s policy. Depreciation and amortization are computed over the estimated useful lives of the assets or the respective lease term for leasehold improvements, whichever is shorter using the straight-line method. Estimated useful lives are as follows: Property and Equipment Useful Lives Buildings 10 - 40 years Leasehold improvements Lesser of lease term or useful life Computer and office equipment 3 - 7 years Furniture and fixtures 3 - 7 years Vehicles 5 - 7 years Computer software 4 - 7 years The Partnership continually evaluates property and equipment, including leasehold improvements, to determine whether events and circumstances have occurred that may warrant revision of the estimated useful life or whether the remaining balance should be evaluated for possible impairment. The Partnership uses an estimate of the related un-discounted cash flows over the remaining life of the property and equipment in assessing whether an asset has been impaired. Management measures impairment losses based upon the amount by which the carrying amount of the asset exceeds the fair value and recognizes the impairment charge as a component of operating expenses. |
Leases | Leases The partnership accounts for leases under Accounting Standards Update (“ASU”) 2016-02, Leases (“ASC 842”), as amended. The Partnership determines if an arrangement is a lease at inception. Right-of-use (“ROU”) assets represent the Partnership’s right-to-use of an underlying asset for the lease term and lease liabilities represent the Partnership’s obligation to make lease payments arising from the lease. Finance leases are recorded in right-of-use assets - finance, on the Consolidated Balance Sheets. Operating lease obligations are included in operating lease liabilities on the Consolidated Balance Sheets. The classification of the Partnership’s leases as operating or finance leases, along with the initial measurement and recognition of the associated ROU assets and lease liabilities is performed at the lease commencement date. The measurement of lease liabilities, for all leases with terms longer than 12 months is based on the present value of future lease payments over the lease term. As the implicit rate in the lease is not determinable, the Partnership uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future lease payments. The ROU asset is based on the measurement of the lease liability and also includes any lease payments made prior to or on lease commencement, and excludes lease incentives and initial direct costs incurred, as applicable. The lease terms may include options to extend or terminate the lease when it is reasonably certain the Partnership will exercise any such options. Rent expense for the Partnership’s operating leases is recognized on a straight-line basis over the lease term. Amortization expense for the ROU asset associated with its finance leases is recognized on a straight-line basis over the shorter of the useful life of the asset or the lease term. The term of the lease and interest expense associated with its finance leases is recognized on the balance of the lease liability using the effective interest method based on the estimated incremental borrowing rate. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the excess cost of businesses acquired over the fair value of the identifiable net assets. The Partnership’s indefinite lived intangible assets include certain tradenames and trademarks. The Partnership expects certain of its tradenames and trademarks will contribute to cash flows for an indefinite period. Definite lived intangible assets listed in the table below are recorded at fair value on the date of acquisition and amortized over their estimated useful lives using the straight‑line method. Software development costs are capitalized when these are ready for service from the time technological feasibility of the software is established. Amortization of the software development begins when the product is available for general release. Capitalized software costs incurred in connection with software development and platforms sold in the Technology-Enabled Services segment are capitalized once the software has reached technological feasibility which the Partnership considers to be a working model. Costs incurred in the maintenance and minor upgrade and enhancement of the Partnership’s software platforms without additional functionality are expensed as incurred. Internal and external costs, if direct and incurred for adding incremental functionality to the Partnership’s platform are capitalized until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. Costs incurred prior to attaining technological feasibility are expensed as incurred. Goodwill is not amortized but is tested for impairment at the reporting unit level at least annually or more often if events occur or circumstances change that could cause these assets to become impaired. Based on the Partnership’s internal reporting structure, the level at which discrete financial information is available and for which operating results are regularly reviewed and the economic similarity of its components, the Partnership has determined it has three reporting units: Erus, a component of the Energy segment, HPI and Halo, which are components of the Technology-Enabled Services segment. We test our goodwill and indefinite lived intangibles for impairment on December 31 of each year. If the Partnership determines that it is more likely than not that the fair value of the goodwill and indefinite lived intangibles of each reporting unit is less than their respective carrying amounts, then a quantitative impairment test would be performed. Under the quantitative impairment test, the fair value of the goodwill and indefinite lived-intangible of each reporting unit is compared to their respective carrying value. If the fair value of the goodwill and indefinite-lived intangible of each reporting unit exceed their respective carrying values, no impairment charge would result. If the fair value of the goodwill and indefinite lived intangible of each reporting unit is less than their respective carrying values, than an impairment charge would be recorded for the excess of the carrying amount of the reporting unit’s goodwill and indefinite-lived intangible assets over the implied fair value of those assets. Our definite-lived intangible assets consist primarily of amortizable intangible assets acquired in business combinations, customer relationships, software development and platforms, certain tradenames and trademarks and covenants not to compete. Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives. We review definite-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amount to future undiscounted cash flows the assets are expected to generate. If definite-lived assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds their fair market value. The estimated useful lives of the intangible assets as of December 31, 2022 were: Intangible Assets Useful Lives Customer relationships 8 - 15 years Software platform 4 - 7 years Developed technology 8 years Covenant not-to-compete 2 - 5 years Trade names and trademarks 3 - 5 years |
Impairment of LongLived Assets | Impairment of Long-Lived Assets Long-lived assets, such as property and equipment subject to depreciation, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Partnership first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models and quoted market values. Impairment losses are recorded as a component of operating expenses in the Consolidated Statements of Operations. |
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities The Partnership’s financial instruments consist of cash, accounts receivables, contract assets, accrued expenses, notes payable, and debt. Fair values for cash, receivables, contract assets and accrued expenses approximate carrying values for these financial instruments because they are relatively short-term in nature. The carrying amount of notes payable and debt approximates fair value based on the length of maturity and existence of interest rates that approximate prevailing rates for similar instruments over similar periods of time. |
Fair Value Measurements | Fair Value Measurements The Partnership utilizes valuation techniques that maximize the use of observable inputs. The Partnership determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: • Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. • Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. A financial instruments categorization with the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. |
Assets Held for Sale and Discontinued Operations | Assets Held for Sale and Discontinued Operations The Partnership classifies long-lived assets (disposal groups) to be sold as held for sale in accordance with ASU 2014-08, Presentation Of Financial Statements (ASC Topic 205) And Property, Plant, And Equipment (ASC Topic 360): Reporting Discontinued And Disclosures Of Disposals Of Components Of An Entity The fair value of a long-lived asset (disposal group) less any costs to sell is assessed each reporting period it remains classified as held for sale and any subsequent changes are reported as an adjustment to the carrying value of the asset (disposal group), as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale. Upon determining that a long-lived asset (disposal group) meets the criteria to be classified as held for sale, the Partnership reports the assets and liabilities of the disposal group for all periods presented in the line items assets held for sale and liabilities held for sale in the accompanying Consolidated Balance Sheets. The Partnership recognizes an impairment loss if the carrying amount of the long-lived asset (disposal group) exceeds the estimated fair value of the long-lived asset (disposal group) less cost to sell. If the Partnership recognizes an impairment loss, the adjusted carrying amount of the long-lived asset (disposal group) becomes its carrying amount. The Partnership classifies long-lived assets that meet the criteria to be classified as held for sale, as discontinued operations when a disposal group represents a strategic shift that has or will have a major effect on the Partnership’s operations and its financial results. The results of all discontinued operations, less applicable income taxes are reported as a separate component of income. Any gain or loss recognized on the disposal of a discontinued operation is presented separately on the Consolidated Statement of Operations. |
Cost of Revenues | Cost of Revenues The ’s cost of revenues represents the amounts related to the sale of products and services. These costs include direct labor employee costs, travel, outsourcing, depreciation of software platforms and materials and parts. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses The Partnership’s operating expenses include, among others, payroll expenses, commissions, administrative expenses, audit fees, professional and insurance expense, litigation related and indemnification expenses, and taxes or other governmental charges levied against the Partnership. Partnership expenses may include broken deal expenses. The Partnership is allocated from GPB a portion of the total compensation of GPB’s or its affiliates’ officers and employees relating to the time such officers or employees provide services to the Partnership or its subsidiaries. |
Revenue Recognition | Revenue Recognition The Partnership follows the provisions of ASC 606, Revenue from Contracts with Customers Technology-Enabled Services : prices charged to clients. In instances where stand-alone selling price is not observable, the Company utilizes an estimate of stand-alone selling price. Such estimates are derived from various methods that include: cost plus margin, historical pricing practices, and the residual approach. Energy Utility resales is revenue from the sale of natural gas to end consumers. Revenue is based on actual volumes sold to customers as the product is delivered, where delivery is the point at which the customers consume the natural gas. Customers are billed monthly on a cycle basis. The Company accrues unbilled revenues for natural gas delivered to customers, but not yet billed at month-end. Revenue is measured at the fair value of the consideration received, excluding discounts, rebates and sales taxes. The business reports revenue net of fulfillment costs in the accompanying Consolidated Statement of Operations as the business acts as an agent in these transactions . Contract Assets Contract assets relate to the Partnership’s pre-payment for materials and services performed and paid upon the installation of solar systems which is before the PTO completion date and revenue recognition. The contract assets are recognized as cost of goods sold and operating expense in the accompanying Consolidated Statement of Operations, concurrent with revenue recognition at the PTO date. |
Income Taxes | Income Taxes The Partnership is a US-based limited partnership treated as a pass-through entity for U.S. federal and state income tax purposes. Some of the Partnership’s wholly owned subsidiaries are classified as corporations and subject to U.S. federal, state, and in some cases, foreign income taxes. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Partnership reduces the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. The need to establish valuation allowances for deferred tax assets is assessed quarterly. In assessing the requirement for, and amount of, a valuation allowance in accordance with the more likely than not standard for all periods, the Partnership considers all positive and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods, and tax planning alternatives. A history of cumulative losses is a significant piece of negative evidence used in the assessment. If a history of cumulative losses is incurred for a tax jurisdiction, forecasts of future profitability are not used as positive evidence related to the realization of the deferred tax assets in the assessment. |
Risks and Uncertainties | Risks and Uncertainties We are subject to a number of legal proceedings at both the Partnership and our portfolio companies, as described in “Note 13. Commitments and Contingencies.” While we are vigorously defending our position in these proceedings, there is uncertainty surrounding their related outcomes and timing. The cost to defend and outcomes of these proceedings could affect the liquidity of the Partnership and the use of available cash. The Technology-Enabled Services industry is subject to rapid innovation, which forces companies to move swiftly to react to changes in the industry. Maintenance of state-of-the-art technology and network equipment is costly and requires expertise. It can be difficult to accurately price our Technology-Enabled Services portfolio companies’ long-term service contracts, which could negatively affect our business. Renewal of customer service contracts and establishment of new customer relationships are essential for growth of our Technology-Enabled Services portfolio companies. Our revenue could decline if we are unable to renew contracts and establish new relationships. Our Technology-Enabled Services portfolio companies derive a significant portion of their revenues from a limited number of customers. Our Technology-Enabled Services portfolio companies rely on their top vendor partners. We outsource a significant portion of our Technology-Enabled Services to offshore service providers which can subject us to a number of risks that may affect our ability to meet our customers’ expectations, contractual obligations and regulatory requirements. If the emerging technologies and platforms upon which we build our products do not gain or continue to maintain broad market acceptance, or if we fail to develop and introduce in a timely manner new products and services compatible with such emerging technologies, we may not be able to compete effectively and our ability to generate revenue will suffer. We are dependent on our license rights and other services from third parties, which may cause us to discontinue, delay or reduce product shipments. We may experience interruption at our data centers or client support facilities. In our healthcare information technology business, we and our clients are subject to a number of existing laws, regulations and industry initiatives, including The Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and other data privacy regulations, and we are susceptible to a continually changing and complex regulatory environment. We own and operate portfolio companies engaged in the energy business, which are subject to various market and regulatory risks that could have a negative impact on our financial results, including changes to government-sponsored incentives to adoption of solar energy, solar panel supply chain interruptions and changes in the relative price of energy sources supplying the electric grid. Many of our customers in this segment finance their purchases, and high levels of inflation or increased interest rates may discourage such purchases in the future. Our energy segment had one major vendor that accounted for substantially all material purchases in cost of sales for the year ended December 31, 2022, 2021 and 2020, respectively. Accounts payable to this vendor were $1.5 million and $3.6 million at December 31, 2022 and 2021, respectively. The Monitor is required to assess the Partnership’s operations and business, and make recommendations to the court, which may include continuation of the operations subject to his monitoring, or a liquidation of assets, or filing for reorganizing in bankruptcy. The Order provides that the Monitor will remain in place until terminated by order of the EDNY Court, and grants the Monitor the authority to approve or disapprove proposed material corporate transactions by GPB, the Partnership or its subsidiaries, extensions of credit by them outside the ordinary course of business, decisions to resume distributions to the Limited Partners of the Partnership, or any decision to file any bankruptcy or receiver petition for any of them, among other actions. On June 13, 2022, the SEC filed by Order to Show Cause in the SEC Action an application to (i) convert the existing Monitorship over GPB and the GPB-managed funds to a Receivership, and appoint the previously-appointed Monitor, Joseph T. Gardemal III, as Receiver; and (ii) impose the “Receivership Application”. The Receivership Application and the Proposed Order were filed with the EDNY Court with consent of GPB’s management. If appointed, the receiver could assume the right to operate and manage the business and we may be subject to, among other things, closer monitoring of our day-to-day activities and books and records than under the current Monitorship. We may also be prohibited from making certain investments or undertaking other activities that we would have otherwise pursued, may be required to settle disputes, including with creditors, in ways that we may not otherwise have agreed to outside of Receivership, or otherwise be subject to reorganization or liquidation. Future outbreaks of COVID-19 could have a material adverse impact on our businesses, financial condition and results of operations. Our impacted businesses have rebounded well to at or near pre-COVID-19 sales levels. However, future COVID-19 outbreaks in the markets in which we operate may in the future cause changes in customer behaviors, including a decrease for healthcare services, and for home and commercial solar systems. This may lead to increased valuation risks, such as impairment of long-lived assets. Uncertainties in the global economy may negatively impact our suppliers and other business partners, which may interrupt our supply chain and require other changes to our operations. These and other factors may adversely impact our financial condition, liquidity and cash flow. Our access to our cash and cash equivalents in amounts adequate to finance our operations could be significantly impaired by the financial institutions, with which we have arrangements. Any material decline in our ability to access our cash and cash equivalents could adversely impact our ability to meet our operating expenses, provide distributions, result in breaches of our contractual obligations or result in violations of federal or state wage and hour laws, among other things, any of which could have material adverse impacts on our operations and liquidity. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Schedule of property plant and equipment | December 31, (Dollars in thousands) 2022 2021 Property and equipment Buildings $ 4,476 $ 5,044 Leasehold improvements 747 775 Computer and office equipment 4,410 3,202 Furniture and fixtures 528 750 Vehicles 2,272 1,892 Computer software 1,473 1,229 Total 13,906 12,892 Accumulated depreciation and amortization (5,661) (4,104) Total property and equipment, net $ 8,245 $ 8,788 |
Schedule of goodwill and intangible assets | Intangible Assets Useful Lives Customer relationships 8 - 15 years Software platform 4 - 7 years Developed technology 8 years Covenant not-to-compete 2 - 5 years Trade names and trademarks 3 - 5 years |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Recognition | |
Schedule of disaggregation of revenue by major product or service lines, separated by reportable segments | Technology - Enabled (Dollars in thousands) Services Energy Total 2022 Product revenue $ 2,158 $ 68,922 $ 71,080 Service revenue 121,910 — 121,910 Revenue Stream Software licenses 2,158 — 2,158 Software maintenance and support 18,726 — 18,726 Professional services 23,390 — 23,390 Medical billing and services 79,794 — 79,794 Solar panel sales — 68,922 68,922 Timing of Revenue Recognition Products and services transferred at a point in time $ 2,158 $ 68,922 $ 71,080 Products and services transferred over time 121,910 — 121,910 Technology - Enabled (Dollars in thousands) Services Energy Total 2021 Product revenue $ 4,405 $ 57,563 $ 61,968 Service revenue 87,325 — 87,325 Revenue Stream Software licenses 4,405 — 4,405 Software maintenance and support 18,190 — 18,190 Professional services 23,511 — 23,511 Medical billing and services 45,624 — 45,624 Solar panel sales — 54,111 54,111 Utility resales — 3,452 3,452 Timing of Revenue Recognition Products and services transferred at a point in time $ 4,405 $ 57,563 $ 61,968 Products and services transferred over time 87,325 — 87,325 Technology - Enabled (Dollars in thousands) Services Energy Total 2020 Product revenue $ 6,726 $ 39,490 $ 46,216 Service revenue 69,466 — 69,466 Revenue Stream Software licenses 6,726 — 6,726 Software maintenance and support 18,057 — 18,057 Professional services 16,462 — 16,462 Medical billing and services 34,947 — 34,947 Solar panel sales — 35,534 35,534 Utility resales — 3,956 3,956 Timing of Revenue Recognition Products and services transferred at a point in time $ 6,726 $ 39,490 $ 46,216 Products and services transferred over time 69,466 — 69,466 |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Acquisitions and Dispositions | |
Schedule of acquired balance sheets, recorded at fair value | (Dollars in thousands) AHS ProComp Current assets $ 17,217 $ 82 Property and equipment 1,362 — Other assets 316 — Intangible assets 35,200 880 Goodwill 41,778 2,191 Current liabilities (6,317) (8) Deferred tax liability (6,474) — Other liabilities (1,482) — Net assets $ 81,600 $ 3,145 Partnership’s ownership 100 % 100 % |
Schedule of acquired intangible assets | (Dollars in thousands) AHS ProComp Useful Lives Customer relationships $ 25,300 $ 320 8 - 12 Years Software development and platform cost 8,200 560 5 Years Trademarks and trade names 1,700 — 8 - 10 Years Total $ 35,200 $ 880 |
Schedule of pro forma consolidated results of operations | Year ended December 31, (Dollars in thousands) 2021 2020 Pro forma revenue $ 184,999 $ 160,383 Pro forma net loss from continuing operations $ (36,509) $ (19,524) |
Discontinued Operations and A_2
Discontinued Operations and Assets Held for Sale (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Automotive Retail | |
Discontinued Operations and Assets Held for Sale | |
Schedule of summarized operating results and cash flows | Year ended December 31, (Dollars in thousands) 2022 2021 2020 Revenues $ — $ 69,255 $ 78,354 Cost of revenues — 57,678 66,550 Gross profit — 11,577 11,804 Operating income 2,224 12,468 5,193 Operating income 2,224 24,045 16,997 Other income — 284 (986) Income from discontinued operations 2,224 24,329 16,011 Gain on sale of discontinued operations — 102,419 — Net income from discontinued operations $ 2,224 $ 126,748 $ 16,011 Year ended December 31 (Dollars in thousands) 2022 2021 2020 Cash provided by (used in) Operating activities $ — $ 5,619 $ 1,276 Investing activities 38,643 (5) (21) Financing activities — (12,339) 2,475 Net increase (decrease) in cash and cash equivalents $ 38,643 $ (6,725) $ 3,730 |
Physical Therapy | |
Discontinued Operations and Assets Held for Sale | |
Schedule of summarized operating results and cash flows | Year ended December 31, (Dollars in thousands) 2021 2020 Revenues $ 75,322 $ 65,662 Cost of revenues 53,678 51,523 Gross profit 21,644 14,139 Operating expenses (18,102) (16,387) Operating income (loss) 3,542 (2,248) Other income 219 1,710 Income (loss) from discontinued operations 3,761 (538) Gain on sale of discontinued operations 74,380 — Net income (loss) from discontinued operations $ 78,141 $ (538) Year ended December 31 (Dollars in thousands) 2021 2020 Cash provided by (used in) Operating activities $ 10,386 $ (6,441) Investing activities (2,927) (2,643) Financing activities (14,985) 12,216 Net (decrease) increase in cash and cash equivalents $ (7,526) $ 3,132 |
Matrix PEO Holdings, LLC and Surge PEO Holdings, LLC | |
Discontinued Operations and Assets Held for Sale | |
Schedule of summarized operating results and cash flows | Year ended December 31, (Dollars in thousands) 2020 Revenues $ 2,232 Cost of revenues 922 Gross profit 1,310 Operating expenses 495 Operating loss 815 Other income (expense) — Income from discontinued operations 815 Gain on sale of discontinued operations 31,806 Income tax expense on discontinued operations (1,402) Net income from discontinued operations $ 31,219 Year ended December 31 (Dollars in thousands) 2020 Cash provided by (used in) Operating activities $ (228) Investing activities 4,000 Financing activities — Net increase in cash and cash equivalents $ 3,772 |
Receivables, net (Tables)
Receivables, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables, net | |
Schedule of receivables, net of allowance for doubtful accounts | December 31, (Dollars in thousands) 2022 2021 Receivables Energy $ 1,866 $ 7,667 Technology-enabled services 27,155 23,348 Corporate and other — 509 Total 29,021 31,524 Allowance for doubtful accounts Energy (223) (617) Technology-enabled services (1,889) (837) Total (2,112) (1,454) Receivables, net $ 26,909 $ 30,070 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity Method Investments | |
Schedule of carrying amounts of equity method investments | December 31, 2022 2021 Ownership Carrying Ownership Carrying (Dollars in thousands) Segment Percentage Amount Percentage Amount Investment Quantum Energy Holdings, LLC Energy 50.0 % $ 9,397 50.0 % $ 12,282 Hotel Internet Services, LLC Technology-Enabled Services 31.0 % 5,996 31.0 % 10,007 Other 74 74 $ 15,467 $ 22,363 |
Schedule of income (losses) from equity method investments | Years Ended December 31, (Dollars in thousands) 2022 2021 2020 Investment Quantum Energy Holdings, LLC $ (2,885) $ 2,263 $ 327 Hotel Internet Services, LLC (4,010) 672 (114) Other 118 514 213 Total $ (6,777) $ 3,449 $ 426 |
Schedule of consolidated balance Sheets from equity method investments | (Dollars in thousands) Quantum HIS December 31, 2022 Current assets $ 5,763 $ 5,194 Non-current assets 515 608 Current liabilities 4,179 3,032 Non-current liabilities 2,045 150 Non-controlling interest (801) — Equity attributable to the Partnership 855 2,620 December 31, 2021 Current assets $ 6,256 $ 3,619 Non-current assets 863 353 Current liabilities 5,611 1,867 Non-current liabilities 2,157 716 Non-controlling interest (777) — Equity attributable to the Partnership 128 1,389 |
Schedule of statements of operations from equity method investments | (Dollars in thousands) Quantum HIS Year ended December 31, 2022 Revenue $ 20,165 $ 10,348 Net income 727 1,232 Year ended December 31, 2021 Revenue $ 20,809 $ 8,644 Net income 5,202 811 Year ended December 31, 2020 Revenue $ 21,816 $ 6,741 Net income 1,515 25 |
Schedule of carrying amount of partnership from equity method investments | (Dollars in thousands) Quantum HIS December 31, 2022 Partnership interest in underlying equity $ 428 $ 812 Allocation of contractual income — 1,704 (Distributions) Contributions (6,671) 226 Step up in basis, net of amortization 15,640 3,254 Carry amount of Partnership interest $ 9,397 $ 5,996 December 31, 2021 Partnership interest in underlying equity $ 64 $ 431 Other — 853 (Distributions) Contributions (6,671) 226 Step up in basis, net of amortization 18,889 8,497 Carry amount of Partnership interest $ 12,282 $ 10,007 |
GPB Prime Holdings, LLC | |
Equity Method Investments | |
Schedule of consolidated balance Sheets from equity method investments | GPB Prime Holdings, LLC Consolidated Balance Sheets as of December 31, 2022 (Liquidation Basis) December 31, 2022 (unaudited) Assets Cash and cash equivalents $ 44,231 Restricted cash 20,224 Contracts in transit 990 Receivables 2,672 Estimated receipts during liquidation 1,067 Assets held for sale 3,650 Total assets $ 72,834 Liabilities Floorplan payable 2,514 Accounts payable 1,640 Accrued expenses and other liabilities 3,127 Liabilities held for sale 1,127 Total liabilities 8,408 Net Assets in Liquidation $ 64,426 GPB Prime Holdings, LLC Consolidated Balance Sheets as of December 31, 2021 and 2020. December 31, 2021 2020 Assets Current assets: Cash $ 107,012 $ 90,609 Current portion of restricted cash 18,949 — Contracts in transit 531 32,767 Receivables, net of allowance for doubtful accounts 7,276 29,201 Due from related parties, current portion 408 — Inventories — 223,314 Prepaid expenses and other current assets 10,614 10,613 Lease rental/service vehicles — 12,463 Assets held for sale 21,647 94,532 Total current assets 166,437 493,499 Non-current assets: Restricted cash, net of current portion 18,949 14,427 Property and equipment, net — 216,252 Goodwill — 135,378 Franchise rights — 112,663 Right-of-use assets - operating — 46,164 Right-of-use assets - finance — 21,944 Due from related parties, net of current portion — 6,340 Other assets 8,254 7,179 Total non-current assets 27,203 560,347 Total assets 193,640 1,053,846 Current liabilities: Accounts payable $ 5,568 $ 30,796 Accrued expenses and other current liabilities 8,687 26,833 Liabilities held for sale 2,236 2,273 Notes payable - related party, current portion — 903 Long-term debt, current portion — 17,894 Redeemable non-controlling interests, current portion — 18,450 Floorplan payable 3,373 246,022 Operating lease liabilities, current portion 133 3,559 Finance lease liabilities, current portion — 787 Leased vehicle liability — 12,510 Total current liabilities 19,997 360,027 Non-current liabilities: Long-term debt, net of current portion — 233,308 Operating lease liabilities, net of current portion 801 44,040 Finance lease liabilities, net of current portion — 22,121 Other liabilities — 1,577 Redeemable non-controlling interests, net of current portion — 9,973 Total non-current liabilities 801 311,019 Total liabilities 20,798 671,046 Members’ capital 172,842 382,800 Total liabilities and members’ capital $ 193,640 $ 1,053,846 |
Schedule of statements of operations from equity method investments | GPB Prime Holdings, LLC Consolidated Statements of Operations for the Years ended December 31, 2021 and 2020. Years ended December 31, 2021 2020 Revenues: New vehicle retail sales $ 805,280 $ 872,701 Used vehicle retail sales 499,933 512,528 Used vehicle wholesale sales 78,747 64,312 Service, body, and parts sales 187,920 210,772 Finance and insurance sales 72,088 68,644 Total revenues 1,643,968 1,728,957 Cost of sales: New vehicle retail cost 723,587 811,404 Used vehicle retail cost 458,053 475,584 Used vehicle wholesale cost 69,716 60,729 Service, body, and parts cost 78,896 90,191 Total cost of sales 1,330,252 1,437,908 Gross profit 313,716 291,049 Operating expenses: Selling, general and administrative expenses 235,578 212,007 (Gain) loss on sale of dealerships, property and equipment, net (288,064) 275 Rent expense 5,063 7,425 Asset impairment 892 2,744 Depreciation and amortization 7,506 8,580 Total operating (income) expenses (39,025) 231,031 Operating income 352,741 60,018 Other income (expense): Floorplan interest (2,648) (6,800) Interest expense (7,957) (11,675) Interest expense to related parties (704) (561) Other income (expense), primarily gain on forgiveness of debt 12,060 (379) Total other income (expense), net 751 (19,415) Net income 353,492 40,603 Net income attributable to non-controlling interests 118,420 13,452 Net income attributable to the Partnership $ 235,072 $ 27,151 |
Schedule of changes in net assets in Liquidation from equity method investments | GPB Prime Holdings, LLC Consolidated Statement of Changes in Net Assets in Liquidation for the year ended December 31, 2022 (Liquidation Basis) Year ended December 31, 2022 (unaudited) Net assets in liquidation, beginning of period $ 172,842 Changes in net assets in liquidation: Increase in accounts receivable 75 Increase in assets held for sale 1,091 Decrease in accounts payable 1,532 Decrease in accrued expenses and other liabilities 5,938 Changes in Liability for estimated costs in excess of estimated receipts during liquidation (653) Net changes in liquidation value 7,983 Proceeds received in excess of assets recorded 3,601 Payments made in excess of liabilities recorded (5,000) Tax distributions made in excess of liabilities recorded — Distributions to Members (115,000) Changes in net assets in liquidation (108,416) Net assets in liquidation, end of period $ 64,426 |
Schedule of consolidated statement of cash flow from equity method investments | Years ended December 31, 2021 2020 Cash flows from operating activities: Net income attributable to GPB Prime Holdings, LLC $ 353,492 $ 40,603 Adjustments to reconcile net income to net cash provided by operating activities Depreciation 6,388 7,361 Amortization of right-of-use assets - finance 1,118 1,219 Amortization of right-of-use assets - operating 3,742 3,901 Amortization of debt issuance costs in interest expense 3,493 1,010 Asset impairment 892 2,744 (Gain) loss on disposal of property and equipment, net (32,259) 1,584 (Gain) loss on sale of dealerships, net (261,070) (1,309) Increase (decrease) in interest rate swap liability in interest expense (835) 835 Bad debt recovery, net (77) 1,260 PPP loan forgiveness (14,860) — Expense related to net income attributable to NCI 2,801 — Other adjustments to reconcile net income/loss (693) 918 Changes in operating assets and liabilities: Contracts in transit 32,236 3,618 Receivables 22,058 3,176 Due from related parties 4,971 10,581 Inventories 111,325 87,992 Prepaids expenses (income) and other current assets (1,679) 3,315 Leased rental/service vehicles 12,463 3,170 Other assets (1,312) (2,697) Accounts payable (25,228) 3,487 Accrued expenses (17,442) (8,749) Payments on lease liabilities - operating (3,427) (3,645) Leases vehicle liability (12,510) (3,075) Other liabilities 11,159 1,576 Net cash provided by operating activities 194,746 158,875 Cash flows from investing activities: Payments for disposition of dealerships — — Purchase of property and equipment (18,099) (7,751) Proceeds from disposition of property and equipment 264,402 12,577 Proceeds from disposition of dealerships 581,809 9,095 Net cash provided by (used in) investing activities 828,112 13,921 Cash flows from financing activities: Payments of floorplan debt, non-trade, net (146,808) (105,696) Proceeds from long-term debt — 27,888 Payments of long-term debt (236,811) (29,633) Payments of finance lease liabilities (1,796) (747) Payments of deferred financing costs (2,190) (782) Partners' capital contributions — — Capital contributions from non-controlling interests 10,777 3,700 Distributions to partners and non-controlling interests (574,229) (64) Distributions to mandatorily redeemable capital (31,927) — Net cash (used in) provided by financing activities (982,984) (105,334) Net increase in cash and restricted cash 39,874 67,462 Cash and restricted cash, beginning of year 105,036 37,574 Cash and restricted cash, end of year $ 144,910 $ 105,036 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Schedule of property and equipment | December 31, (Dollars in thousands) 2022 2021 Property and equipment Buildings $ 4,476 $ 5,044 Leasehold improvements 747 775 Computer and office equipment 4,410 3,202 Furniture and fixtures 528 750 Vehicles 2,272 1,892 Computer software 1,473 1,229 Total 13,906 12,892 Accumulated depreciation and amortization (5,661) (4,104) Total property and equipment, net $ 8,245 $ 8,788 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets | |
Schedule of goodwill | Technology - Enabled (Dollars in thousands) Services Energy Total Balance, December 31, 2022 $ 64,601 $ 14,294 $ 78,895 Goodwill acquired through business combinations — — — Balance, December 31, 2021 64,601 14,294 78,895 Goodwill acquired through business combinations 43,969 — 43,969 Balance, January 1, 2021 $ 20,632 $ 14,294 $ 34,926 |
Schedule of intangible assets | Weighted Gross Average Carrying Accumulated Net Carrying Remaining (Dollars in thousands) Amount Impairment Amortization Amount Lives (Years) December 31, 2022 Customer relationships $ 90,658 $ — $ (37,993) $ 52,665 5.6 Trademark and trade names 5,760 — (3,108) 2,652 1.7 Software development and platform cost 38,610 — (25,954) 12,656 4.1 Covenant not to compete 1,341 — (1,341) — — Total $ 136,369 $ — $ (68,396) $ 67,973 December 31, 2021 Customer relationships $ 90,658 $ — $ (28,148) $ 62,510 9.8 Trademark and trade names 5,760 — (2,308) 3,452 2.7 Software development and platform cost 38,067 — (22,239) 15,828 7.6 Covenant not to compete 1,341 — (1,341) — — Total $ 135,826 $ — $ (54,036) $ 81,790 (1) |
Schedule of estimated amortization expense | Estimated (Dollars in thousands) Amortization Expense 2023 $ 13,625 2024 12,934 2025 11,936 2026 11,077 2027 7,426 Thereafter 9,366 Total $ 66,364 |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings | |
Schedule of debt, other than amounts due to related-parties and lease obligations | December 31, (Dollars in thousands) 2022 2021 Promissory notes $ — $ 55,000 Lines of credit 1,624 1,790 Installment notes 125 225 Total long-term debt 1,749 57,015 Less: current maturities (1,724) (2,205) Less: debt issuance costs — (2,319) Long term debt, less current maturities $ 25 $ 52,491 |
Schedule of aggregate contractual maturities of debt | Contractual (Dollars in thousands) Amount 2023 $ 1,724 2024 25 2025 and thereafter — Total $ 1,749 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Summary of domestic and foreign components of income (loss) from continuing operations before income taxes | December 31, (Dollars in thousands) 2022 2021 2020 Domestic $ (33,258) $ (38,262) $ (20,332) Foreign 3,834 1,829 1,115 Loss from continuing operations before income tax $ (29,424) $ (36,433) $ (19,217) |
Summary of benefit (expense) for income taxes attributable to loss from continuing operations | December 31, (Dollars in thousands) 2022 2020 2020 Current: Federal $ (23) $ — $ — State (219) (123) — Foreign (731) (398) (176) (973) (521) (176) Deferred: Federal 1,614 419 — State 282 418 — Foreign (58) (28) 23 1,838 809 23 Income tax benefit (expense) $ 865 $ 288 $ (153) |
Summary of reconciliation of the difference between income tax (expense) benefit from continuing operations at the statutory rate and the Partnerships' total income tax provision | December 31, 2022 2021 2020 Statutory federal tax rate $ 6,179 $ 7,651 $ 4,036 Non-taxable earnings (4,832) (7,471) (4,270) State income taxes, net of federal benefit 108 321 — Foreign earnings subject to different tax rates (14) (41) 81 Non-deductible expenses (878) (162) — Deferred adjustments including provision to return 290 — — Other 12 (10) — Income tax benefit (expense) $ 865 $ 288 $ (153) |
Summary of significant components of deferred income tax assets and liabilities | December 31, (Dollars in thousands) 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 401 $ 259 State net operating loss carryforwards 170 99 Pension liability — 175 Interest limitation - Sec 163j 2,868 2,377 Accrued vacation — 223 Right of use asset - lease liability 391 — Other 314 127 Total deferred tax assets 4,144 3,260 Valuation allowance — — Total deferred tax assets, net of valuation allowance 4,144 3,260 Deferred tax liabilities: Intangible assets (7,292) (8,571) Right of use assets (394) — Property and equipment (491) (590) Total deferred tax liabilities (8,177) (9,161) Total net deferred tax liabilities $ (4,033) $ (5,901) |
Business Segments (Tables)
Business Segments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Segments | |
Schedule of reportable segments | Technology Enabled Corporate (Dollars in thousands) Services Energy and Other Total 2022 Revenue $ 124,068 $ 68,922 $ (1,841) $ 191,149 Loss (income) from equity method investments 4,010 2,885 (118) 6,777 Gain on disposal of businesses — (4,424) (2,299) (6,723) Depreciation and amortization 14,645 529 — 15,174 Operating income (loss) (854) 2,216 (26,540) (25,178) Gain on sale of discontinued operations — — 7,919 7,919 Expenditures for long-lived assets (1,166) (388) — (1,554) Total assets 213,672 47,330 341,173 602,175 2021 Revenue $ 91,730 $ 57,563 $ 4,066 $ 153,359 Income from equity method investments (672) (2,263) (514) (3,449) Loss on disposal of businesses — — 5,334 5,334 Depreciation and amortization 9,758 480 64 10,302 Operating income (loss) 2,984 3,702 (40,302) (33,616) Gain on sale of discontinued operations — — 176,799 176,799 Expenditures for long-lived assets (928) (727) (3,667) (5,322) Total assets 219,810 60,641 423,095 703,546 2020 Revenue $ 76,192 $ 39,490 $ 3,534 $ 119,216 (Income) loss from equity method investments 114 (327) (213) (426) Impairment of goodwill, intangibles and other assets 780 — — 780 Depreciation and amortization 8,285 401 31 8,717 Operating income (loss) 2,996 2,744 (24,227) (18,487) Gain on sale of discontinued operations — — 31,806 31,806 Expenditures for long-lived assets (912) (510) (5,854) (7,276) Total assets 126,627 44,288 369,606 540,521 |
Organization, Nature of Busin_2
Organization, Nature of Business and Recent Events (Details) $ in Millions | 12 Months Ended | ||||
Feb. 11, 2021 USD ($) | Feb. 04, 2021 | Dec. 31, 2022 segment | Jan. 31, 2022 | Dec. 31, 2021 | |
Organization, Nature of Business and Recent Events | |||||
Number of segments | segment | 3 | ||||
Percentage of annualized distribution payments to investors | 8% | 8% | |||
Compensation fees paid | $ | $ 8 | ||||
Hotel Internet Services, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Noncontrolling interest | 31% | ||||
Project Halo Holdings, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 96% | ||||
HPI | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 91.90% | ||||
Micro Development Services Inc. | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 100% | ||||
Erus Holdings, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 60% | ||||
Quantum Energy Holdings, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 50% | 50% | 50% | ||
GPB Prime Holdings, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 33.50% | ||||
Riverwalk Tower, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 76.70% | ||||
Armada Waste Management Holdings, LLC | |||||
Organization, Nature of Business and Recent Events | |||||
Ownership percentage | 3% |
Significant Accounting Policies
Significant Accounting Policies - Principles of Consolidation and Equity Method (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |||
Impairment charges in relation to the equity method investments | $ 8 | $ 0 | $ 0 |
Significant Accounting Polici_2
Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash, Cash Equivalents and Restricted Cash | ||||
Cash held in banks | $ 30,100 | |||
Cash, cash equivalents and restricted cash | 352,654 | $ 375,801 | $ 82,364 | $ 70,675 |
Deposits | 20,900 | |||
Restricted cash | $ 18,227 | $ 9,102 | ||
Restricted Cash, Current, Statement of Financial Position [Extensible Enumeration] | Restricted cash | |||
US treasury bill securities | ||||
Cash, Cash Equivalents and Restricted Cash | ||||
Investee in original maturity | $ 304,300 |
Significant Accounting Polici_3
Significant Accounting Policies -Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Buildings | Minimum | |
Property and Equipment | |
Property plant and equipment useful life | 10 years |
Buildings | Maximum | |
Property and Equipment | |
Property plant and equipment useful life | 40 years |
Leasehold Improvements | |
Property and Equipment | |
Estimated useful lives | Lesser of lease term or useful life |
Computer equipment | Minimum | |
Property and Equipment | |
Property plant and equipment useful life | 3 years |
Computer equipment | Maximum | |
Property and Equipment | |
Property plant and equipment useful life | 7 years |
Furniture and fixtures | Minimum | |
Property and Equipment | |
Property plant and equipment useful life | 3 years |
Furniture and fixtures | Maximum | |
Property and Equipment | |
Property plant and equipment useful life | 7 years |
Vehicles | Minimum | |
Property and Equipment | |
Property plant and equipment useful life | 5 years |
Vehicles | Maximum | |
Property and Equipment | |
Property plant and equipment useful life | 7 years |
Software development | Minimum | |
Property and Equipment | |
Property plant and equipment useful life | 4 years |
Software development | Maximum | |
Property and Equipment | |
Property plant and equipment useful life | 7 years |
Significant Accounting Polici_4
Significant Accounting Policies - Goodwill and Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Customer relationships | Minimum | |
Goodwill and Intangible Assets | |
Useful life | 8 years |
Customer relationships | Maximum | |
Goodwill and Intangible Assets | |
Useful life | 15 years |
Software platform | Minimum | |
Goodwill and Intangible Assets | |
Useful life | 4 years |
Software platform | Maximum | |
Goodwill and Intangible Assets | |
Useful life | 7 years |
Developed technology | |
Goodwill and Intangible Assets | |
Useful life | 8 years |
Covenant not-to-compete | Minimum | |
Goodwill and Intangible Assets | |
Useful life | 2 years |
Covenant not-to-compete | Maximum | |
Goodwill and Intangible Assets | |
Useful life | 5 years |
Trademarks and trade names | Minimum | |
Goodwill and Intangible Assets | |
Useful life | 3 years |
Trademarks and trade names | Maximum | |
Goodwill and Intangible Assets | |
Useful life | 5 years |
Significant Accounting Polici_5
Significant Accounting Policies - Risks and Uncertainties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |||
Cost of revenue | $ 102,673 | $ 73,043 | $ 54,177 |
Accounts payables | $ 1,500 | $ 3,600 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | $ 191,149 | $ 153,359 | $ 119,216 |
Product revenue | 71,080 | 61,968 | 46,216 |
Service revenue | 121,910 | 87,325 | 69,466 |
Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Product revenue | 2,158 | 4,405 | 6,726 |
Service revenue | 121,910 | 87,325 | 69,466 |
Energy | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Product revenue | 68,922 | 57,563 | 39,490 |
Transferred at Point in Time | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 71,080 | 61,968 | 46,216 |
Transferred at Point in Time | Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 2,158 | 4,405 | 6,726 |
Transferred at Point in Time | Energy | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 68,922 | 57,563 | 39,490 |
Transferred over Time | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 121,910 | 87,325 | 69,466 |
Transferred over Time | Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 121,910 | 87,325 | 69,466 |
Software licenses | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 2,158 | 4,405 | 6,726 |
Software licenses | Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 2,158 | 4,405 | 6,726 |
Software maintenance and support | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 18,726 | 18,190 | 18,057 |
Software maintenance and support | Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 18,726 | 18,190 | 18,057 |
Professional services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 23,390 | 23,511 | 16,462 |
Professional services | Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 23,390 | 23,511 | 16,462 |
Medical billing and services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 79,794 | 45,624 | 34,947 |
Medical billing and services | Technology - Enabled Services | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 79,794 | 45,624 | 34,947 |
Solar panel sales | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 68,922 | 54,111 | 35,534 |
Solar panel sales | Energy | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | $ 68,922 | 54,111 | 35,534 |
Utility resales | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | 3,452 | 3,956 | |
Utility resales | Energy | |||
Disaggregation of revenue by major product or service lines, separated by reportable segments | |||
Total revenues | $ 3,452 | $ 3,956 |
Acquisitions and Dispositions -
Acquisitions and Dispositions - 2022 Acquisition (Details) - HPI $ in Thousands | Jul. 18, 2022 USD ($) |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Transaction costs | $ 300 |
Subsidiary of the Partnership, One | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Ownership interest owned | 89% |
Cash consideration | $ 13,500 |
Payments of non-controlling shareholder | 500 |
MDS | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Gain or loss recorded in connection with transaction | $ 0 |
MDS | Subsidiary of the Partnership, One | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Ownership interest acquired | 100% |
MDS | Subsidiary of the Partnership, Two | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Ownership interest previously held | 80% |
Acquisitions and Dispositions_2
Acquisitions and Dispositions - 2022 Disposals (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2022 | Jan. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Gain (loss) on disposal of businesses | $ 6,723 | $ (5,334) | ||
Greenwave Energy Holdings, LLC | Discontinued Operations, Disposed of by Sale | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from disposal of business | $ 4,400 | |||
Gain (loss) on disposal of businesses | $ 4,400 | |||
Middleneck | Discontinued Operations, Disposed of by Sale | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from disposal of business | $ 9,900 | |||
Gain (loss) on disposal of businesses | $ 2,300 |
Acquisitions and Dispositions_3
Acquisitions and Dispositions - 2021 Acquisition (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jul. 18, 2022 | Nov. 01, 2021 | Sep. 30, 2021 | Dec. 31, 2021 | |
HPI | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Transaction costs | $ 0.3 | |||
AdvantEdge Healthcare Solutions, Inc | HPI | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Consideration transferred | $ 81.6 | |||
Amount in cash | 3.3 | |||
Cash consideration | 58.3 | |||
Consideration transferred from issuance of new term loans | 55 | |||
Cash and restricted cash acquired | 7.4 | |||
Fair value of the earnout | 15.9 | |||
Earnout contingent being earned and paid | $ 10.8 | |||
Transaction costs | $ 1.8 | |||
Pro-Comp | Cantata | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Consideration transferred | $ 3.1 | |||
Cash consideration | 2.1 | |||
Fair value of the earnout | $ 1 |
Acquisitions and Dispositions_4
Acquisitions and Dispositions - Components of the acquired balance sheets (Details) $ in Thousands | Dec. 31, 2021 USD ($) |
AdvantEdge Healthcare Solutions, Inc | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Current assets | $ 17,217 |
Property and equipment | 1,362 |
Other assets | 316 |
Intangible assets | 35,200 |
Goodwill | 41,778 |
Current liabilities | (6,317) |
Deferred tax liability | (6,474) |
Other liabilities | (1,482) |
Net assets | $ 81,600 |
Partnership's ownership | 100% |
Pro-Comp | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Current assets | $ 82 |
Intangible assets | 880 |
Goodwill | 2,191 |
Current liabilities | (8) |
Net assets | $ 3,145 |
Partnership's ownership | 100% |
Acquisitions and Dispositions_5
Acquisitions and Dispositions - Intangible assets (Details) - USD ($) $ in Thousands | 2 Months Ended | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Pro forma revenue | $ 184,999 | $ 160,383 | ||
Pro forma net loss from continuing operations | $ (36,509) | $ (19,524) | ||
Customer relationships | Minimum | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Useful life | 8 years | |||
Customer relationships | Maximum | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Useful life | 12 years | |||
Software development and platform cost | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Useful life | 5 years | |||
Trademarks and trade names | Minimum | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Useful life | 8 years | |||
Trademarks and trade names | Maximum | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Useful life | 10 years | |||
AdvantEdge Healthcare Solutions, Inc | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | $ 35,200 | $ 35,200 | $ 35,200 | |
Revenue | 10,700 | |||
Net income (loss) | 600 | |||
AdvantEdge Healthcare Solutions, Inc | Customer relationships | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | 25,300 | 25,300 | 25,300 | |
AdvantEdge Healthcare Solutions, Inc | Software development and platform cost | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | 8,200 | 8,200 | 8,200 | |
AdvantEdge Healthcare Solutions, Inc | Trademarks and trade names | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | 1,700 | 1,700 | 1,700 | |
Pro-Comp | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | 880 | 880 | 880 | |
Revenue | 137,000 | |||
Net income (loss) | 33,000 | |||
Pro-Comp | Customer relationships | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | 320 | 320 | 320 | |
Pro-Comp | Software development and platform cost | ||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||
Intangible assets | $ 560 | $ 560 | $ 560 |
Acquisitions and Dispositions_6
Acquisitions and Dispositions - 2021 Disposals (Details) $ in Thousands | 1 Months Ended | 2 Months Ended | 12 Months Ended | |||||||||
Dec. 28, 2021 USD ($) | Nov. 15, 2021 USD ($) | Sep. 17, 2021 USD ($) | Jan. 31, 2023 USD ($) | Apr. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) item | Nov. 30, 2021 USD ($) item Center | Apr. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) Center item | Dec. 31, 2020 USD ($) | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Gain (loss) on disposal of businesses | $ 6,723 | $ (5,334) | ||||||||||
Gain from sale of dealerships and real estate | 7,919 | 176,799 | $ 31,806 | |||||||||
Assets held for sale | $ 41,364 | $ 21,583 | 41,364 | |||||||||
GPB Prime | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Ownership interest owned | 33.50% | |||||||||||
Disposed by sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Number of dealerships sold | item | 28 | |||||||||||
Held for sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Number of dealerships sold | item | 28 | |||||||||||
Distribution received | $ 38,500 | |||||||||||
Riverwalk Tower, LLC | Disposed by sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Promissory note payable as consideration for sale of business | $ 28,300 | |||||||||||
Interest on notes | 9.50% | |||||||||||
Notes up to the receipt of which interest is payable | $ 20,800 | |||||||||||
Gain (loss) on disposal of businesses | 5,300 | |||||||||||
Consideration from disposal | $ 28,300 | |||||||||||
Prime Automotive Group | Held for sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Promissory note payable as consideration for sale of business | $ 824,900 | |||||||||||
Number of collision centers sold | Center | 3 | |||||||||||
Number of dealerships sold | item | 27 | |||||||||||
Number of dealerships held | item | 29 | |||||||||||
Consideration from disposal | $ 824,900 | |||||||||||
Consideration for disposal kept in escrow account | 33,400 | |||||||||||
Consideration for disposal of real estate | 763,600 | |||||||||||
GPB Prime | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Assets held for sale | $ 57,900 | $ 21,600 | $ 57,900 | |||||||||
GPB Prime | Held for sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Number of collision centers sold | Center | 3 | |||||||||||
Number of dealerships sold | item | 28 | |||||||||||
Distributions | $ 570,000 | $ 115,000 | $ 115,000 | |||||||||
Distribution received | $ 188,800 | $ 8,000 | ||||||||||
Gain from sale of dealerships and real estate | $ 96,500 | $ 21,600 | $ 96,500 | |||||||||
Alliance | Held for sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Promissory note payable as consideration for sale of business | $ 119,000 | |||||||||||
Consideration from disposal | 119,000 | |||||||||||
Gain from sale of dealerships and real estate | $ 74,400 | |||||||||||
Orangeburg | Held for sale | ||||||||||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | ||||||||||||
Promissory note payable as consideration for sale of business | 28,100 | |||||||||||
Consideration from disposal | 28,100 | |||||||||||
Gain from sale of dealerships and real estate | $ 5,900 | $ 5,900 | ||||||||||
Percentage of ownership interest sold | 100% | |||||||||||
Net cash proceeds from disposal | $ 24,600 |
Acquisitions and Dispositions_7
Acquisitions and Dispositions - 2020 Acquisition (Details) $ in Millions | 1 Months Ended |
Sep. 30, 2020 USD ($) | |
Project Halo Holdings, LLC | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Consideration acquisition | $ 6.5 |
Payments of non-controlling shareholder | $ 5.8 |
Ownership interest previously held | 79% |
Gain or loss recorded in connection with transaction | $ 0.7 |
Project Halo Holdings, LLC | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |
Ownership interest owned | 96% |
Acquisitions and Dispositions_8
Acquisitions and Dispositions - 2020 Dispositions (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Feb. 14, 2020 | Feb. 29, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |||||
Gain on sale of discontinued operations | $ 7,919 | $ 176,799 | $ 31,806 | ||
Matrix PEO Holdings, LLC and Surge PEO Holdings, LLC | Disposed by sale | |||||
Acquisitions, Disposals, Discontinued Operations and Assets Held for Sale | |||||
Consideration from disposal | $ 82,400 | $ 82,400 | |||
Consideration received in cash | 15,500 | ||||
Gain on sale of discontinued operations | $ (31,800) | 30,400 | (7,900) | $ 31,806 | |
Final earnout payment received | 5,900 | 5,900 | |||
Earnout payment directly to non-controlling interest holders | 1,700 | 1,700 | |||
Write off of liabilities | $ 300 | $ 300 |
Discontinued Operations and A_3
Discontinued Operations and Assets Held for Sale - Additional Information (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jan. 31, 2023 USD ($) | Nov. 30, 2021 USD ($) item | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) Center item | Dec. 31, 2020 USD ($) | |
Discontinued Operations and Assets Held for Sale | |||||
Gain on sale of discontinued operations | $ (7,919) | $ (176,799) | $ (31,806) | ||
Discontinued Operations, Held-for-sale [Member] | |||||
Discontinued Operations and Assets Held for Sale | |||||
Number of dealerships sold | item | 28 | ||||
Automotive Retail | Discontinued Operations, Held-for-sale [Member] | |||||
Discontinued Operations and Assets Held for Sale | |||||
Gain on sale of discontinued operations | $ (102,419) | ||||
GPB Prime Holdings, LLC | Discontinued Operations, Held-for-sale [Member] | |||||
Discontinued Operations and Assets Held for Sale | |||||
Equity investment held | 33.50% | ||||
Number of collision centers sold | Center | 3 | ||||
Number of dealerships sold | item | 28 | ||||
Gain on sale of discontinued operations | $ (96,500) | $ (21,600) | $ (96,500) | ||
Orangeburg | Discontinued Operations, Held-for-sale [Member] | |||||
Discontinued Operations and Assets Held for Sale | |||||
Gain on sale of discontinued operations | $ (5,900) | $ (5,900) |
Discontinued Operations and A_4
Discontinued Operations and Assets Held for Sale - Operating results (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Feb. 14, 2020 | Jan. 31, 2023 | Feb. 29, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating results | ||||||
Income (loss) from discontinued operations | $ 10,143 | $ 204,889 | $ 46,692 | |||
Gain on sale of discontinued operations | 7,919 | 176,799 | 31,806 | |||
Income tax expense on discontinued operations | 1,402 | |||||
Net income (loss) from discontinued operations | 2,224 | 28,090 | 14,886 | |||
Automotive Retail | Discontinued operations, held-for-sale | ||||||
Operating results | ||||||
Revenues | 69,255 | 78,354 | ||||
Cost of revenues | 57,678 | 66,550 | ||||
Gross profit | 11,577 | 11,804 | ||||
Operating income (loss) | 2,224 | 12,468 | 5,193 | |||
Operating income | 2,224 | 24,045 | 16,997 | |||
Other income (expense) | 284 | (986) | ||||
Income (loss) from discontinued operations | 2,224 | 24,329 | 16,011 | |||
Gain on sale of discontinued operations | 102,419 | |||||
Net income (loss) from discontinued operations | 2,224 | 126,748 | 16,011 | |||
GPB Prime Holdings, LLC | Discontinued operations, held-for-sale | ||||||
Operating results | ||||||
Gain on sale of discontinued operations | $ 96,500 | 21,600 | 96,500 | |||
Physical Therapy | Discontinued operations, held-for-sale | ||||||
Operating results | ||||||
Revenues | 75,322 | 65,662 | ||||
Cost of revenues | 53,678 | 51,523 | ||||
Gross profit | 21,644 | 14,139 | ||||
Operating expenses | (18,102) | (16,387) | ||||
Operating income | 3,542 | (2,248) | ||||
Other income (expense) | 219 | 1,710 | ||||
Income (loss) from discontinued operations | 3,761 | (538) | ||||
Gain on sale of discontinued operations | 74,380 | |||||
Net income (loss) from discontinued operations | $ 78,141 | (538) | ||||
Matrix PEO Holdings, LLC and Surge PEO Holdings, LLC | Discontinued operations | ||||||
Operating results | ||||||
Revenues | 2,232 | |||||
Cost of revenues | 922 | |||||
Gross profit | 1,310 | |||||
Operating income (loss) | 495 | |||||
Operating income | 815 | |||||
Income (loss) from discontinued operations | 815 | |||||
Gain on sale of discontinued operations | $ (31,800) | $ 30,400 | $ (7,900) | 31,806 | ||
Income tax expense on discontinued operations | (1,402) | |||||
Net income (loss) from discontinued operations | $ 31,219 |
Discontinued Operations and A_5
Discontinued Operations and Assets Held for Sale - Cash flow (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash provided by (used in) | |||
Operating activities | $ (2,224) | $ (12,084) | $ (20,279) |
Financing activities | (4,822) | 305 | |
Automotive Retail | Discontinued operations, held-for-sale | |||
Cash provided by (used in) | |||
Operating activities | 5,619 | 1,276 | |
Investing activities | 38,643 | (5) | (21) |
Financing activities | (12,339) | 2,475 | |
Net (decrease) increase in cash and cash equivalents | $ 38,643 | (6,725) | 3,730 |
Physical Therapy | Discontinued operations, held-for-sale | |||
Cash provided by (used in) | |||
Operating activities | 10,386 | (6,441) | |
Investing activities | (2,927) | (2,643) | |
Financing activities | (14,985) | 12,216 | |
Net (decrease) increase in cash and cash equivalents | $ (7,526) | 3,132 | |
Matrix PEO Holdings, LLC and Surge PEO Holdings, LLC | Discontinued operations | |||
Cash provided by (used in) | |||
Operating activities | (228) | ||
Investing activities | 4,000 | ||
Net (decrease) increase in cash and cash equivalents | $ 3,772 |
Discontinued Operations and A_6
Discontinued Operations and Assets Held for Sale - Corporate and other - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Feb. 14, 2020 | Sep. 27, 2019 | Feb. 29, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Discontinued Operations and Assets Held for Sale | ||||||
Gain on sale of discontinued operations | $ (7,919) | $ (176,799) | $ (31,806) | |||
Matrix PEO Holdings, LLC and Surge PEO Holdings, LLC | Discontinued operations | ||||||
Discontinued Operations and Assets Held for Sale | ||||||
Carrying value of the remaining investment included in assets held for sale | $ 7,200 | |||||
Percentage of Ownership Interest Sold | 100% | |||||
Consideration from disposal | $ 82,400 | $ 82,400 | ||||
Cash acquired by the buyer | 15,500 | |||||
Final earnout payment received | 5,900 | 5,900 | ||||
Earnout payment directly to non-controlling interest holders | 1,700 | 1,700 | ||||
Write off of liabilities | 300 | 300 | ||||
Gain on sale of discontinued operations | $ 31,800 | $ (30,400) | $ 7,900 | $ (31,806) |
Receivables, net (Details)
Receivables, net (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Receivables, net | ||
Receivables | $ 29,021 | $ 31,524 |
Allowance for doubtful accounts | (2,112) | (1,454) |
Receivables, net | 26,909 | 30,070 |
Energy | ||
Receivables, net | ||
Receivables | 1,866 | 7,667 |
Allowance for doubtful accounts | (223) | (617) |
Technology - Enabled Services | ||
Receivables, net | ||
Receivables | 27,155 | 23,348 |
Allowance for doubtful accounts | $ (1,889) | (837) |
Corporate and Other | ||
Receivables, net | ||
Receivables | $ 509 |
Equity Method Investments - Car
Equity Method Investments - Carrying amounts of equity method investments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jan. 31, 2022 | Dec. 31, 2021 |
Equity Method Investments | |||
Equity method investments | $ 15,467 | $ 22,363 | |
Other | |||
Equity Method Investments | |||
Equity method investments | $ 74 | $ 74 | |
Quantum Energy Holdings, LLC | |||
Equity Method Investments | |||
Ownership percentage | 50% | 50% | 50% |
Equity method investments | $ 9,397 | $ 12,282 | |
Hotel Internet Services, LLC | |||
Equity Method Investments | |||
Ownership percentage | 31% | 31% | |
Equity method investments | $ 5,996 | $ 10,007 |
Equity Method Investments - Inc
Equity Method Investments - Income (losses) from equity method investments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Equity Method Investments | |||
Income from equity method investments | $ (6,777) | $ 3,449 | $ 426 |
(Income) loss from equity method investments | (6,777) | 3,449 | 426 |
Other | |||
Equity Method Investments | |||
(Income) loss from equity method investments | 118 | 514 | 213 |
Quantum Energy Holdings, LLC | |||
Equity Method Investments | |||
(Income) loss from equity method investments | (2,885) | 2,263 | 327 |
Hotel Internet Services, LLC | |||
Equity Method Investments | |||
(Income) loss from equity method investments | $ (4,010) | $ 672 | $ (114) |
Equity Method Investments - Add
Equity Method Investments - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Equity Method Investments | |||
Impairment | $ 8 | $ 0 | $ 0 |
Quantum Energy Holdings, LLC | |||
Equity Method Investments | |||
Impairment | 2.9 | ||
Hotel Internet Services, LLC | |||
Equity Method Investments | |||
Impairment | $ 5.1 |
Equity Method Investments - Con
Equity Method Investments - Condensed balance sheet data and income statement data of equity method investments and (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed balance sheet data | |||
Current assets | $ 423,632 | $ 472,006 | |
Non-current assets | 178,543 | 231,540 | |
Current liabilities | 53,876 | 72,479 | |
Non-current liabilities | 8,531 | 63,799 | |
Non-controlling interests | 12,766 | 16,566 | |
Equity attributable to the Partnership | 527,002 | 550,702 | |
Condensed income statement data | |||
Revenue | 191,149 | 153,359 | $ 119,216 |
Net income | (20,780) | 166,324 | 17,883 |
Quantum Energy Holdings, LLC | |||
Condensed balance sheet data | |||
Current assets | 5,763 | 6,256 | |
Non-current assets | 515 | 863 | |
Current liabilities | 4,179 | 5,611 | |
Non-current liabilities | 2,045 | 2,157 | |
Non-controlling interests | (801) | (777) | |
Equity attributable to the Partnership | 855 | 128 | |
Condensed income statement data | |||
Revenue | 20,165 | 20,809 | 21,816 |
Net income | 727 | 5,202 | 1,515 |
Hotel Internet Services, LLC | |||
Condensed balance sheet data | |||
Current assets | 5,194 | 3,619 | |
Non-current assets | 608 | 353 | |
Current liabilities | 3,032 | 1,867 | |
Non-current liabilities | 150 | 716 | |
Equity attributable to the Partnership | 2,620 | 1,389 | |
Condensed income statement data | |||
Revenue | 10,348 | 8,644 | 6,741 |
Net income | $ 1,232 | $ 811 | $ 25 |
Equity Method Investments - Rec
Equity Method Investments - Reconciliation of the Partnership's interest in underlying equity of the investee to the carrying amount of the Partnership's interest (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Partnership's interest in underlying equity of investee to the carrying amount of the Partnership's interest | ||
Carry amount of Partnership interest | $ 15,467 | $ 22,363 |
Quantum Energy Holdings, LLC | ||
Reconciliation of Partnership's interest in underlying equity of investee to the carrying amount of the Partnership's interest | ||
Partnership interest in underlying equity | 428 | 64 |
(Distributions) Contributions | (6,671) | (6,671) |
Step up in basis, net of amortization | 15,640 | 18,889 |
Carry amount of Partnership interest | 9,397 | 12,282 |
Hotel Internet Services, LLC | ||
Reconciliation of Partnership's interest in underlying equity of investee to the carrying amount of the Partnership's interest | ||
Partnership interest in underlying equity | 812 | 431 |
Allocation of contractual income | 1,704 | |
Other | 853 | |
(Distributions) Contributions | 226 | 226 |
Step up in basis, net of amortization | 3,254 | 8,497 |
Carry amount of Partnership interest | $ 5,996 | $ 10,007 |
Equity Method Investments - GPB
Equity Method Investments - GPB Prime Holdings, LLC - textuals (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Equity Method Investments | ||
Equity method investments | $ 15,467 | $ 22,363 |
GPB Prime Holdings, LLC | ||
Equity Method Investments | ||
Ownership percentage | 33.50% | |
GPB Prime Holdings, LLC | APLP | ||
Equity Method Investments | ||
Ownership percentage | 33.50% | 66.50% |
Equity Method Investments - C_2
Equity Method Investments - Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Assets | |||
Cash and cash equivalents | $ 334,427 | $ 356,574 | |
Restricted cash | 18,227 | 9,102 | |
Total assets | 602,175 | 703,546 | $ 540,521 |
Liabilities | |||
Accounts payable | 8,192 | 9,074 | |
Total liabilities | 62,407 | 136,278 | |
GPB Prime Holdings, LLC | |||
Assets | |||
Assets held for sale | 21,600 | 57,900 | |
GPB Prime Holdings, LLC | |||
Assets | |||
Cash and cash equivalents | 44,231 | 107,012 | 90,609 |
Restricted cash | 20,224 | 18,949 | |
Contracts in transit | 990 | ||
Receivables | 2,672 | ||
Estimated receipts during liquidation | 1,067 | ||
Assets held for sale | 3,650 | ||
Total assets | 72,834 | 193,640 | 1,053,846 |
Liabilities | |||
Floorplan payable | 2,514 | ||
Accounts payable | 1,640 | 5,568 | 30,796 |
Accrued expenses and other liabilities | 3,127 | ||
Liabilities held for sale | 1,127 | 2,236 | 2,273 |
Total liabilities | 8,408 | 20,798 | $ 671,046 |
Net Assets in Liquidation | $ 64,426 | $ 172,842 |
Equity Method Investments - C_3
Equity Method Investments - Consolidated Statement of Changes in Net Assets in Liquidation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in net assets in liquidation: | |||
Increase in accounts receivable | $ (319) | $ 3,363 | $ 4,474 |
Decrease in accounts payable | (582) | 672 | 878 |
GPB Prime Holdings, LLC [Member] | |||
Equity Method Investments | |||
Net assets in liquidation, beginning of period | 172,842 | ||
Changes in net assets in liquidation: | |||
Increase in accounts receivable | 75 | (22,058) | (3,176) |
Increase in assets held for sale | 1,091 | ||
Decrease in accounts payable | 1,532 | (25,228) | $ 3,487 |
Decrease in accrued expenses and other liabilities | 5,938 | ||
Changes in Liability for estimated costs in excess of estimated receipts during liquidation | (653) | ||
Net changes in liquidation value | 7,983 | ||
Proceeds received in excess of assets recorded | 3,601 | ||
Payments made in excess of liabilities recorded | (5,000) | ||
Distributions to Members | (115,000) | ||
Changes in net assets in liquidation | (108,416) | ||
Net assets in liquidation, end of period | $ 64,426 | $ 172,842 |
Equity Method Investments - G_2
Equity Method Investments - GPB Prime Holdings, LLC Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | |||
Cash and cash equivalents | $ 334,427 | $ 356,574 | |
Restricted cash | 18,227 | 9,102 | |
Due from related parties | 66 | ||
Inventories | 1,097 | 878 | |
Current assets held for sale, continuing operations | 7,253 | ||
Total current assets | 423,632 | 472,006 | |
Non-current assets: | |||
Restricted cash - long-term | 10,125 | ||
Property and equipment, net | 8,245 | 8,788 | |
Goodwill | 78,895 | 78,895 | $ 34,926 |
Right-of-use assets operating | 6,535 | 8,456 | |
Other non-current assets | 699 | 1,267 | |
Total non-current assets | 178,543 | 231,540 | |
Total assets | 602,175 | 703,546 | 540,521 |
Current liabilities: | |||
Accounts payable | 8,192 | 9,074 | |
Long-term debt, current portion | 1,724 | 2,205 | |
Operating lease liabilities, current portion | 2,533 | 3,992 | |
Finance lease liabilities, current portion | 224 | 227 | |
Total current liabilities | 53,876 | 72,479 | |
Non-current liabilities: | |||
Long-term debt, net of current portion | 25 | 52,491 | |
Operating lease liabilities, net of current portion | 3,498 | 4,069 | |
Other liabilities | 816 | 968 | |
Total non-current liabilities | 8,531 | 63,799 | |
Total liabilities | 62,407 | 136,278 | |
Total liabilities and partners' capital | 602,175 | 703,546 | |
GPB Prime Holdings, LLC | |||
Current assets: | |||
Cash and cash equivalents | 44,231 | 107,012 | 90,609 |
Restricted cash | 20,224 | 18,949 | |
Contracts in transit | 531 | 32,767 | |
Receivables, net of allowance for doubtful accounts | 7,276 | 29,201 | |
Due from related parties | 408 | ||
Inventories | 223,314 | ||
Prepaid expenses and other current assets | 10,614 | 10,613 | |
Lease rental/service vehicles | 12,463 | ||
Current assets held for sale, continuing operations | 21,647 | 94,532 | |
Total current assets | 166,437 | 493,499 | |
Non-current assets: | |||
Restricted cash - long-term | 18,949 | 14,427 | |
Property and equipment, net | 216,252 | ||
Goodwill | 135,378 | ||
Franchise rights | 112,663 | ||
Right-of-use assets operating | 46,164 | ||
Right-of-use assets - finance | 21,944 | ||
Due from related parties, net of current portion | 6,340 | ||
Other non-current assets | 8,254 | 7,179 | |
Total non-current assets | 27,203 | 560,347 | |
Total assets | 72,834 | 193,640 | 1,053,846 |
Current liabilities: | |||
Accounts payable | 1,640 | 5,568 | 30,796 |
Accrued expenses and other current liabilities | 8,687 | 26,833 | |
Liabilities held for sale | 1,127 | 2,236 | 2,273 |
Notes payable - related party, current portion | 903 | ||
Long-term debt, current portion | 17,894 | ||
Redeemable non-controlling interests, current portion | 18,450 | ||
Floorplan payable | 3,373 | 246,022 | |
Operating lease liabilities, current portion | 133 | 3,559 | |
Finance lease liabilities, current portion | 787 | ||
Leased vehicle liability | 12,510 | ||
Total current liabilities | 19,997 | 360,027 | |
Non-current liabilities: | |||
Long-term debt, net of current portion | 233,308 | ||
Operating lease liabilities, net of current portion | 801 | 44,040 | |
Finance lease liabilities, net of current portion | 22,121 | ||
Other liabilities | 1,577 | ||
Redeemable non-controlling interests, net of current portion | 9,973 | ||
Total non-current liabilities | 801 | 311,019 | |
Total liabilities | $ 8,408 | 20,798 | 671,046 |
Members' capital | 172,842 | 382,800 | |
Total liabilities and partners' capital | $ 193,640 | $ 1,053,846 |
Equity Method Investments - G_3
Equity Method Investments - GPB Prime Holdings, LLC Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues: | |||
Total revenues | $ 191,149 | $ 153,359 | $ 119,216 |
Cost of revenues: | |||
Cost of revenue | 102,673 | 73,043 | 54,177 |
Gross profit | 88,476 | 80,316 | 65,039 |
Operating expenses (income): | |||
Selling, general and administrative expenses | 85,998 | 86,533 | 59,379 |
Rent expense | 4,576 | 3,338 | 2,831 |
Asset impairment | 780 | ||
Depreciation and amortization | 15,174 | 10,302 | 8,717 |
Total net operating expenses | 113,654 | 113,932 | 83,526 |
Operating loss | (25,178) | (33,616) | (18,487) |
Other income (expense): | |||
Interest expense | (2,823) | (1,465) | (36) |
Other income (expense), primarily gain on forgiveness of debt | 881 | 830 | 166 |
Total other expense | (4,246) | (2,817) | (730) |
Net (loss) income of continuing and discontinued operations | (18,416) | 168,744 | 27,322 |
Net income (loss) attributable to non-controlling interest | 2,364 | 2,420 | 9,439 |
Net (loss) income attributable to the Partnership | $ (20,780) | 166,324 | 17,883 |
GPB Prime Holdings, LLC | |||
Revenues: | |||
Total revenues | 1,643,968 | 1,728,957 | |
Cost of revenues: | |||
Cost of revenue | 1,330,252 | 1,437,908 | |
Gross profit | 313,716 | 291,049 | |
Operating expenses (income): | |||
Selling, general and administrative expenses | 235,578 | 212,007 | |
(Gain) loss on sale of dealerships, property and equipment, net | (288,064) | 275 | |
Rent expense | 5,063 | 7,425 | |
Asset impairment | 892 | 2,744 | |
Depreciation and amortization | 7,506 | 8,580 | |
Total net operating expenses | (39,025) | 231,031 | |
Operating loss | 352,741 | 60,018 | |
Other income (expense): | |||
Floorplan interest | (2,648) | (6,800) | |
Interest expense | (7,957) | (11,675) | |
Interest expense to related parties | (704) | (561) | |
Other income (expense), primarily gain on forgiveness of debt | 12,060 | (379) | |
Total other expense | 751 | (19,415) | |
Net (loss) income of continuing and discontinued operations | 353,492 | 40,603 | |
Net income (loss) attributable to non-controlling interest | 118,420 | 13,452 | |
Net (loss) income attributable to the Partnership | 235,072 | 27,151 | |
GPB Prime Holdings, LLC | New vehicle retail | |||
Revenues: | |||
Total revenues | 805,280 | 872,701 | |
Cost of revenues: | |||
Cost of revenue | 723,587 | 811,404 | |
GPB Prime Holdings, LLC | Used vehicle retail | |||
Revenues: | |||
Total revenues | 499,933 | 512,528 | |
Cost of revenues: | |||
Cost of revenue | 458,053 | 475,584 | |
GPB Prime Holdings, LLC | Used vehicle wholesale | |||
Revenues: | |||
Total revenues | 78,747 | 64,312 | |
Cost of revenues: | |||
Cost of revenue | 69,716 | 60,729 | |
GPB Prime Holdings, LLC | Service, body, and parts | |||
Revenues: | |||
Total revenues | 187,920 | 210,772 | |
Cost of revenues: | |||
Cost of revenue | 78,896 | 90,191 | |
GPB Prime Holdings, LLC | Finance and insurance | |||
Revenues: | |||
Total revenues | $ 72,088 | $ 68,644 |
Equity Method Investments - G_4
Equity Method Investments - GPB Prime Holdings, LLC Consolidated Statements of Cash Flow (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net (loss) income | $ (18,416) | $ 168,744 | $ 27,322 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | |||
Depreciation expense related to property and equipment | 2,100 | 1,500 | 1,100 |
Amortization of right of use assets - operating and finance | 4,401 | 3,103 | 2,550 |
Amortization of deferred financing costs | 286 | 167 | 47 |
Asset impairment | 780 | ||
Bad debt expense | 1,514 | 3,345 | 1,665 |
Changes in operating assets and liabilities, net of effects from business combinations and dispositions: | |||
Accounts receivable, net | 319 | (3,363) | (4,474) |
Due from related parties | 66 | (256) | (364) |
Inventories | (219) | 1,089 | (1,344) |
Accounts payable | (582) | 672 | 878 |
Accrued expenses | (1,078) | 2,286 | (554) |
Operating lease liability | (4,510) | (2,930) | (2,491) |
Net cash used in operating activities | (9,929) | (9,928) | (2,484) |
Cash flows from investing activities: | |||
Purchase of property and equipment | (1,554) | (5,322) | (7,276) |
Proceeds from sale of property and equipment | 11 | 39 | |
Net cash provided by investing activities | 59,252 | 257,881 | 66,538 |
Cash flows from financing activities: | |||
Repayments on finance lease obligations | (215) | (225) | (12) |
Payments of debt issuance costs | (1,891) | (98) | |
Net cash (used in) provided by financing activities | (72,419) | 37,977 | (63,884) |
Net (decrease) increase in cash and cash equivalents and restricted cash | (23,147) | 285,911 | 132 |
Cash and cash equivalents and restricted cash of continuing operations - beginning of year | 375,801 | 82,364 | 70,675 |
Cash and cash equivalents and restricted cash of continuing operations - end of year | 352,654 | 375,801 | 82,364 |
GPB Prime Holdings, LLC | |||
Cash flows from operating activities: | |||
Net (loss) income | 353,492 | 40,603 | |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | |||
Depreciation expense related to property and equipment | 6,388 | 7,361 | |
Amortization of right-of-use assets - finance | 1,118 | 1,219 | |
Amortization of right of use assets - operating and finance | 3,742 | 3,901 | |
Amortization of deferred financing costs | 3,493 | 1,010 | |
Asset impairment | 892 | 2,744 | |
(Gain) loss on disposal of property and equipment, net | (32,259) | 1,584 | |
(Gain) loss on sale of dealerships, net | (261,070) | (1,309) | |
Increase (decrease) in interest rate swap liability in interest expense | (835) | 835 | |
Bad debt expense | (77) | 1,260 | |
PPP loan forgiveness | (14,860) | ||
Expense related to net income attributable to NCI | 2,801 | ||
Other adjustments to reconcile net income/loss | (693) | 918 | |
Changes in operating assets and liabilities, net of effects from business combinations and dispositions: | |||
Contracts in transit | 32,236 | 3,618 | |
Accounts receivable, net | (75) | 22,058 | 3,176 |
Due from related parties | 4,971 | 10,581 | |
Inventories | 111,325 | 87,992 | |
Prepaids expenses (income) and other current assets | (1,679) | 3,315 | |
Leased rental/service vehicles | 12,463 | 3,170 | |
Other assets | (1,312) | (2,697) | |
Accounts payable | 1,532 | (25,228) | 3,487 |
Accrued expenses | (17,442) | (8,749) | |
Operating lease liability | (3,427) | (3,645) | |
Leases vehicle liability | (12,510) | (3,075) | |
Other liabilities | 11,159 | 1,576 | |
Net cash used in operating activities | 194,746 | 158,875 | |
Cash flows from investing activities: | |||
Purchase of property and equipment | (18,099) | (7,751) | |
Proceeds from sale of property and equipment | 264,402 | 12,577 | |
Proceeds from disposition of dealerships | 581,809 | 9,095 | |
Net cash provided by investing activities | 828,112 | 13,921 | |
Cash flows from financing activities: | |||
Payments of floorplan debt, non-trade, net | (146,808) | (105,696) | |
Proceeds from long-term debt | 27,888 | ||
Payments of long-term debt | (236,811) | (29,633) | |
Repayments on finance lease obligations | (1,796) | (747) | |
Payments of debt issuance costs | (2,190) | (782) | |
Capital contributions from non-controlling interests | 10,777 | 3,700 | |
Distributions to partners and non-controlling interests | (574,229) | (64) | |
Distributions to mandatorily redeemable capital | (31,927) | ||
Net cash (used in) provided by financing activities | (982,984) | (105,334) | |
Net (decrease) increase in cash and cash equivalents and restricted cash | 39,874 | 67,462 | |
Cash and cash equivalents and restricted cash of continuing operations - beginning of year | $ 144,910 | 105,036 | 37,574 |
Cash and cash equivalents and restricted cash of continuing operations - end of year | $ 144,910 | $ 105,036 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property and Equipment | |||
Total | $ 13,906 | $ 12,892 | |
Accumulated depreciation and amortization | (5,661) | (4,104) | |
Total property and equipment, net | 8,245 | 8,788 | |
Depreciation expense related to property and equipment | 2,100 | 1,500 | $ 1,100 |
Buildings | |||
Property and Equipment | |||
Total | 4,476 | 5,044 | |
Leasehold Improvements | |||
Property and Equipment | |||
Total | 747 | 775 | |
Computer and office equipment | |||
Property and Equipment | |||
Total | 4,410 | 3,202 | |
Furniture and fixtures | |||
Property and Equipment | |||
Total | 528 | 750 | |
Vehicles | |||
Property and Equipment | |||
Total | 2,272 | 1,892 | |
Computer software | |||
Property and Equipment | |||
Total | $ 1,473 | $ 1,229 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill | ||
Balance at beginning | $ 78,895 | $ 34,926 |
Goodwill acquired through business combinations | 0 | 43,969 |
Goodwill at ending | 78,895 | 78,895 |
Technology Enabled Services | ||
Goodwill | ||
Balance at beginning | 64,601 | 20,632 |
Goodwill acquired through business combinations | 0 | 43,969 |
Goodwill at ending | 64,601 | 64,601 |
Energy | ||
Goodwill | ||
Balance at beginning | 14,294 | 14,294 |
Goodwill acquired through business combinations | 0 | |
Goodwill at ending | $ 14,294 | $ 14,294 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Intangible assets | ||
Gross Carrying Amount | $ 136,369 | $ 135,826 |
Accumulated Amortization | (68,396) | (54,036) |
Net Carrying Amount | 67,973 | 81,790 |
Indefinite lived intangible assets not subject to amortization | ||
Intangible assets | ||
Net Carrying Amount | 1,600 | 1,600 |
Customer Relationships [Member] | ||
Intangible assets | ||
Gross Carrying Amount | 90,658 | 90,658 |
Accumulated Amortization | (37,993) | (28,148) |
Net Carrying Amount | $ 52,665 | $ 62,510 |
Weighted Average Remaining Lives (Years) | 5 years 7 months 6 days | 9 years 9 months 18 days |
Trademarks and Trade Names [Member] | ||
Intangible assets | ||
Gross Carrying Amount | $ 5,760 | $ 5,760 |
Accumulated Amortization | (3,108) | (2,308) |
Net Carrying Amount | $ 2,652 | $ 3,452 |
Weighted Average Remaining Lives (Years) | 1 year 8 months 12 days | 2 years 8 months 12 days |
Software and Software Development Costs [Member] | ||
Intangible assets | ||
Gross Carrying Amount | $ 38,610 | $ 38,067 |
Accumulated Amortization | (25,954) | (22,239) |
Net Carrying Amount | $ 12,656 | $ 15,828 |
Weighted Average Remaining Lives (Years) | 4 years 1 month 6 days | 7 years 7 months 6 days |
Covenant Not To Compete | ||
Intangible assets | ||
Gross Carrying Amount | $ 1,341 | $ 1,341 |
Accumulated Amortization | $ (1,341) | $ (1,341) |
Weighted Average Remaining Lives (Years) | 0 years | 0 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Estimated amortization expense (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Estimated Amortization Expense | |
2023 | $ 13,625 |
2024 | 12,934 |
2025 | 11,936 |
2026 | 11,077 |
2027 | 7,426 |
Thereafter | 9,366 |
Total | $ 66,364 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Intangible assets | |||
Capitalized software development costs | $ 0.5 | $ 0.7 | $ 0.8 |
Amortization expense related to intangible assets | 14.4 | 10 | 11.3 |
Goodwill impairment loss | 0 | 0 | 0.8 |
Software and Software Development Costs [Member] | |||
Intangible assets | |||
Amortization expense related to intangible assets | $ 1.3 | $ 1.2 | $ 3.7 |
Borrowings (Details)
Borrowings (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Borrowings | ||
Total long-term debt | $ 1,749 | $ 57,015 |
Less: current maturities | (1,724) | (2,205) |
Less: debt issuance costs | (2,319) | |
Long term debt, less current maturities | 25 | 52,491 |
Promissory notes | ||
Borrowings | ||
Total long-term debt | 55,000 | |
Lines of credit | ||
Borrowings | ||
Total long-term debt | 1,624 | 1,790 |
Installment notes | ||
Borrowings | ||
Total long-term debt | $ 125 | $ 225 |
Borrowings - Aggregate contract
Borrowings - Aggregate contractual maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Aggregate contractual maturities | ||
2023 | $ 1,724 | |
2024 | 25 | |
Total long-term debt | $ 1,749 | $ 57,015 |
Borrowings - Promissory notes (
Borrowings - Promissory notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Borrowings | |||||
Total long-term debt | $ 1,749 | $ 57,015 | |||
Amortization of deferred financing costs | 286 | 167 | $ 47 | ||
Promissory Notes | |||||
Borrowings | |||||
Aggregate principal amount | $ 57,000 | ||||
Maturity term | 5 years | ||||
Total long-term debt | 55,000 | ||||
Debt issuance costs | $ 2,400 | ||||
Amortization of deferred financing costs | $ 400 | ||||
Percentage of Exit Fee on stated amount of debt | 1% | ||||
Period of EBDITA in calculating exit fee | 12 months | ||||
Fair value of the Exit Fee | $ 600 | ||||
Repayment of the loan | 57,400 | ||||
Principal amount | 55,000 | ||||
Interest premium | 2,300 | ||||
Legal fees | 100 | ||||
Exit fees | 600 | ||||
Expenses associated with the loan repayment included in loss on extinguishment of debt | 4,500 | ||||
Unamortized debt costs | 2,100 | ||||
Installment Note | |||||
Borrowings | |||||
Total long-term debt | 125 | $ 225 | |||
Repayment of the loan | $ 100 | ||||
LIBOR | Promissory Notes | |||||
Borrowings | |||||
Interest rate, basis spread | 8% | ||||
LIBOR | Installment Note | |||||
Borrowings | |||||
Interest rate, basis spread | 4% | ||||
Crestline Agreement | Promissory Notes | |||||
Borrowings | |||||
Aggregate principal amount | $ 2,000 | ||||
Notes Payable, Other Payables | Crestline Agreement | Promissory Notes | |||||
Borrowings | |||||
Aggregate principal amount | 57,000 | ||||
Term loan | Promissory Notes | |||||
Borrowings | |||||
Aggregate principal amount | $ 55,000 |
Borrowings - Lines of credit (D
Borrowings - Lines of credit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Borrowings | |||
Proceeds from lines of credit | $ 620 | $ 1,827 | $ 1,674 |
Repayments on lines of credit | $ 786 | $ 1,013 | $ 925 |
Lines of credit | |||
Borrowings | |||
Effective interest rate (as a percent) | 7.75% | 3.50% | |
Lines of credit | $ 1,600 | $ 1,800 | |
Proceeds from lines of credit | 600 | 1,800 | |
Repayments on lines of credit | $ 800 | $ 1,000 | |
Prime rate | Lines of credit | |||
Borrowings | |||
Interest rate, basis spread | 0.25% |
Borrowings - PPP loan (Details)
Borrowings - PPP loan (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Apr. 10, 2020 | Apr. 30, 2021 | Dec. 31, 2022 | |
Borrowings | |||
loan interest matured | 1% | ||
Paycheck Protection Program | |||
Borrowings | |||
Amount borrowed | $ 1.1 | ||
Amount of loan forgiven | $ 1.1 | ||
Gain on loan forgiven | $ 1.1 |
Income Taxes - Income (loss) be
Income Taxes - Income (loss) before income tax (expense) benefit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Domestic and foreign components of income (loss) from continuing operations before income taxes | |||
Domestic | $ (33,258) | $ (38,262) | $ (20,332) |
Foreign | 3,834 | 1,829 | 1,115 |
Loss from continuing operations before income tax | $ (29,424) | $ (36,433) | $ (19,217) |
Income Taxes - Income tax benef
Income Taxes - Income tax benefit (expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ (23) | ||
State | (219) | $ (123) | |
Foreign | (731) | (398) | $ (176) |
Current | (973) | (521) | (176) |
Deferred: | |||
Federal | 1,614 | 419 | |
State | 282 | 418 | |
Foreign | (58) | (28) | 23 |
Deferred | 1,838 | 809 | 23 |
Income tax benefit (expense) | $ 865 | $ 288 | $ (153) |
Income Taxes - reconciliation o
Income Taxes - reconciliation of the difference between income tax benefit (expense) from continuing operations at the statutory rate and the Partnerships' total income tax provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of the difference between income tax benefit (expense) from continuing operations at the statutory rate and the Partnerships' total income tax provision | |||
Statutory federal tax rate | $ 6,179 | $ 7,651 | $ 4,036 |
Non-taxable earnings | (4,832) | (7,471) | (4,270) |
State income taxes, net of federal benefit | 108 | 321 | |
Foreign earnings subject to different tax rates | (14) | (41) | 81 |
Non-deductible expenses | (878) | (162) | |
Deferred adjustments including provision to return | 290 | ||
Other | 12 | (10) | |
Income tax benefit (expense) | $ 865 | $ 288 | $ (153) |
Income Taxes - significant comp
Income Taxes - significant components of deferred income tax assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 401 | $ 259 |
State net operating loss carryforwards | 170 | 99 |
Pension liability | 175 | |
Interest limitation - Sec 163j | 2,868 | 2,377 |
Accrued vacation | 223 | |
Right of use asset - lease liability | 391 | |
Other | 314 | 127 |
Total deferred tax assets | 4,144 | 3,260 |
Valuation allowance | 0 | |
Total deferred tax assets, net of valuation allowance | 4,144 | 3,260 |
Deferred tax liabilities: | ||
Intangible assets | (7,292) | (8,571) |
Right of use assets | (394) | |
Property and equipment | (491) | (590) |
Total deferred tax liabilities | (8,177) | (9,161) |
Total net deferred tax liabilities | $ (4,033) | $ (5,901) |
Income Taxes - textuals (Detail
Income Taxes - textuals (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Income Taxes | |
Valuation allowance | $ 0 |
Federal net operating loss carryforwards, which can be carried forward indefinitely | 1.9 |
Gross state net operating loss carryforwards expiring between 2026 and indefinite | 3.2 |
Unrecognized tax benefits | $ 0 |
Partners' Capital - Capital Con
Partners' Capital - Capital Contributions (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Class A Limited Partnership Units | |||
Partners' Capital | |||
Amount authorized | $ 750 | ||
Number of shares outstanding | 5,892.48 | 6,001.44 | 5,999.38 |
Class A-1 Limited Partnership Units | |||
Partners' Capital | |||
Number of shares outstanding | 3,168.26 | 3,059.30 | 3,061.36 |
Class B Limited Partnership Units | |||
Partners' Capital | |||
Amount authorized | $ 750 | ||
Number of shares outstanding | 2,955.88 | 2,953.80 | 2,941.80 |
Class B-1 Limited Partnership Units | |||
Partners' Capital | |||
Number of shares outstanding | 1,604.25 | 1,606.33 | 1,618.33 |
Partners' Capital - Distributio
Partners' Capital - Distributions (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) shares | |
Class A and A-1 Limited Partnership Units | |
Partners' Capital | |
Cash distributions rate | 8% |
Gross capital contributions | $ 50,000 |
Selling fees (as a percent) | 11% |
Selling fees equaling adjusted unit | shares | 1 |
Class A and A-1 Limited Partnership Units | if a Limited Partner subscribed into Class A for $50,000 | |
Partners' Capital | |
Cash distributions rate | 8% |
Gross capital contributions | $ 50,000 |
Selling fees (as a percent) | 11% |
Net capital contribution | $ 44,500 |
Yearly distribution | $ 4,000 |
Class B and B-1 Limited Partnership Units | |
Partners' Capital | |
Cash distributions rate | 8.70% |
Partners' Capital - Distribut_2
Partners' Capital - Distributions, priorities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Partners' Capital | ||
First priority to Limited Partners, in proportion to respective Net Capital Contributions (as a percent) | 100% | |
Second priority to Limited Partners, in proportion to respective Unreturned Capital Contributions (as a percent) | 100% | |
Third priority to Limited Partners, in proportion to respective Accrued Preferred Returns (as a percent) | 100% | |
Fourth priority to Special Partners (as a percent) | 100% | |
Cumulative distributions made to the Special Partner as percentage of the sum of all amounts distributed to each Limited Partner in excess of Limited Partners' Net Capital Contribution Amount (as a percent) | 20% | |
Last priority to Limited Partners with amounts distributed to the Limited Partners in proportion to aggregate Capital Contributions (as a percent) | 80% | |
Last priority to Special Partners with amounts distributed to the Limited Partners in proportion to aggregate Capital Contributions (as a percent) | 20% | |
State tax withholding distributions | $ 2.1 | $ 1.7 |
Partners' Capital - Redemptions
Partners' Capital - Redemptions (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Partners' Capital | |
Holding term of units to request for repurchase | 1 year |
Maximum redemption percentage in any 12 month period | 10% |
Term for non redemption of share after receipt of required written notice of redemption | 12 months |
Redemption price as percentage of net asset value | 97% |
Cash available for redemptions as percentage of operating cash flow from previous fiscal year | 10% |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 1 Months Ended | 12 Months Ended | |||||||||||
Jan. 30, 2023 USD ($) | May 31, 2022 item | Apr. 14, 2022 USD ($) | Feb. 04, 2021 USD ($) item state person | Nov. 30, 2021 USD ($) | Feb. 28, 2021 USD ($) | Jan. 31, 2021 USD ($) | May 31, 2020 USD ($) | Dec. 31, 2019 USD ($) | Nov. 30, 2019 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Commitments and Contingencies | |||||||||||||
Legal indemnification expenses | $ 8,000,000 | $ 4,000,000 | $ 1,500,000 | ||||||||||
Number of individuals of which criminal cases brought on account of fraud | person | 3 | ||||||||||||
Number of counts of wire fraud charged | item | 2 | ||||||||||||
Number of state securities regulators filed suit against company | state | 7 | ||||||||||||
Amount in excess of defendants' collection of fraudulent rebates | $ 1,000,000 | ||||||||||||
Loss contingency and investment | $ 1,270,000,000 | ||||||||||||
Unpaid Principal and Interest Under the Promissory Note with GPB Lender, LLC | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | $ 2,000,000 | ||||||||||||
Unpaid Principal and Interest Under the Two Loan Agreements with GPB Lender, LLC | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | $ 2,500,000 | 400,000 | |||||||||||
Unpaid Principal Due Along With Accrued And Unpaid Interest With Client Llc | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | 800,000 | ||||||||||||
Aggregate principal amount | 900,000 | ||||||||||||
Unpaid Principal due, Along With Accrued and Unpaid Interest with Plymouth Rock Holding LLC | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | $ 300,000 | ||||||||||||
Aggregate principal amount | $ 400,000 | ||||||||||||
Breach of Contract with Mary Purcell | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged losses in excess of amounts | $ 4,800,000 | ||||||||||||
Case filed by Stanley S. and Millicent R. Barasch Trust and Loretta Dehay | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged losses in excess of amounts | $ 1,800,000,000 | ||||||||||||
Case filed by Kinnie Ma Individual Retirement Account | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged losses in excess of amounts | $ 1,800,000 | ||||||||||||
Case filed by Concorde Investment Services, LLC | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | $ 5,000,000 | ||||||||||||
Waste Management Disposal Services of Pennsylvania, Inc v Nino Tristani | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | $ 300,000 | ||||||||||||
Agreed settlement amount | $ 400,000 | ||||||||||||
Waste Management of New York, LLC V Nino Tristani | |||||||||||||
Commitments and Contingencies | |||||||||||||
Alleged amount by plaintiff | $ 300,000 | ||||||||||||
Agreed settlement amount | $ 400,000 | ||||||||||||
David Gentile | |||||||||||||
Commitments and Contingencies | |||||||||||||
Percentage of annualized distribution payments to investors | 8% | ||||||||||||
Amount received from undisclosed self-dealing | $ 8,000,000 | ||||||||||||
Number of managers appointed for strategic assessment | item | 3 | ||||||||||||
Number of business days given to cure the violation of the Amended Order | 10 days |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | 23 Months Ended | 74 Months Ended | ||||||||
Jul. 18, 2022 | Jul. 31, 2022 | Nov. 30, 2021 | Jan. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2017 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2017 | Mar. 31, 2022 | |
Related Party Transaction | ||||||||||||
Managerial assistance fee, related party | $ 7,900 | $ 11,900 | $ 12,200 | |||||||||
Due to related parties | 374 | 375 | ||||||||||
Managerial assistance fee, related party | 7,852 | 11,874 | 12,245 | |||||||||
Revenue | 191,149 | 153,359 | 119,216 | |||||||||
Quarterly installment amount | $ 63 | |||||||||||
Waste Management Disposal Services of Pennsylvania, Inc v Nino Tristani [Member] | ||||||||||||
Related Party Transaction | ||||||||||||
Agreed settlement amount | $ 400 | |||||||||||
Alleged amount by plaintiff | $ 300 | |||||||||||
MDS Medical LLC | ||||||||||||
Related Party Transaction | ||||||||||||
Outstanding payable balance | $ 400 | |||||||||||
Ownership interest acquired | 100% | |||||||||||
Cash consideration | $ 13,500 | |||||||||||
Transaction costs | 300 | |||||||||||
MDS Medical LLC | Non-controlling shareholder | ||||||||||||
Related Party Transaction | ||||||||||||
Cash consideration | $ 500 | |||||||||||
Class A Limited Partners | ||||||||||||
Related Party Transaction | ||||||||||||
Percentage on Gross Capital Contributions as Managerial Assistance Fee | 2% | |||||||||||
Class A-1 Limited Partners | ||||||||||||
Related Party Transaction | ||||||||||||
Percentage on Gross Capital Contributions as Managerial Assistance Fee | 1.75% | |||||||||||
Class B Limited Partners | ||||||||||||
Related Party Transaction | ||||||||||||
Percentage on Gross Capital Contributions as Managerial Assistance Fee | 2% | |||||||||||
Class B-1 Limited Partners | ||||||||||||
Related Party Transaction | ||||||||||||
Percentage on Gross Capital Contributions as Managerial Assistance Fee | 1.75% | |||||||||||
Affiliated Entity | ||||||||||||
Related Party Transaction | ||||||||||||
General and administrative expenses | 2,200 | 1,900 | ||||||||||
Quantum | ||||||||||||
Related Party Transaction | ||||||||||||
Managerial assistance fee, related party | $ 800 | 400 | 700 | |||||||||
Itelagen | Waste Management Disposal Services of Pennsylvania, Inc v Nino Tristani [Member] | ||||||||||||
Related Party Transaction | ||||||||||||
Alleged amount by plaintiff | 300 | 1,200 | ||||||||||
Partnership Expenses. | ||||||||||||
Related Party Transaction | ||||||||||||
Partnership expenses | 12,400 | 7,000 | 3,200 | |||||||||
Partnership Expenses. | GPB Holdings | ||||||||||||
Related Party Transaction | ||||||||||||
Due to related parties | 0 | 200 | ||||||||||
Loan to Quantum, Equity Method Investee | Notes Receivable | ||||||||||||
Related Party Transaction | ||||||||||||
Due to related parties | 0 | 100 | ||||||||||
Aggregate principal amount | 500 | |||||||||||
Interest rate | 4% | 8% | ||||||||||
Payments to related party | 100 | 400 | 200 | |||||||||
Loan to Quantum For Purpose Of Closing Florida Office | Notes Receivable | ||||||||||||
Related Party Transaction | ||||||||||||
Aggregate principal amount | $ 800 | |||||||||||
Interest rate | 8% | |||||||||||
Outstanding balance of notes receivable | 0 | 300 | ||||||||||
Proceeds from related party loan | $ 300 | 300 | 300 | |||||||||
Maturity term | 36 months | |||||||||||
Loan Agreement was Entered into by Project Halo Holdings LLC | Notes Payable, Other Payables | ||||||||||||
Related Party Transaction | ||||||||||||
Interest rate | 10% | 10% | ||||||||||
Maturity term | 36 months | |||||||||||
Outstanding balance of notes payable | $ 0 | 6,500 | $ 13,000 | |||||||||
Amount of debt pay down for extended maturity | $ 6,500 | |||||||||||
Interest expense | 100 | 700 | 1,300 | |||||||||
Consulting Agreements | ||||||||||||
Related Party Transaction | ||||||||||||
Accounts payable | 200 | 800 | ||||||||||
Consulting Agreements | Green Wave | ||||||||||||
Related Party Transaction | ||||||||||||
General and administrative expenses | 300 | 300 | ||||||||||
Consulting Agreements | Erus | ||||||||||||
Related Party Transaction | ||||||||||||
General and administrative expenses | 200 | 200 | 200 | |||||||||
Other Related Party Transactions | Erus | ||||||||||||
Related Party Transaction | ||||||||||||
Managerial assistance fee, related party | 600 | 300 | ||||||||||
Revenue | 800 | 500 | 400 | |||||||||
Other Related Party Transactions | HPI | ||||||||||||
Related Party Transaction | ||||||||||||
Revenue | 5,300 | 6,300 | 5,000 | |||||||||
Accounts receivable from related party | 500 | 600 | ||||||||||
Other Related Party Transactions | Certain automobile dealers | ||||||||||||
Related Party Transaction | ||||||||||||
Purchase of vehicles | 1,100 | 500 | ||||||||||
Sale of vehicles | 1,500 | 1,700 | ||||||||||
Agreements as a Vendor and Customer with Itelagen | Itelagen | ||||||||||||
Related Party Transaction | ||||||||||||
Sale of vehicles | 300 | 600 | ||||||||||
OSP Fees for the Services Rendered by Highline | ||||||||||||
Related Party Transaction | ||||||||||||
General and administrative expenses | 1,400 | 5,300 | 1,400 | |||||||||
Leases space from an officer | Quantum | ||||||||||||
Related Party Transaction | ||||||||||||
Rent paid | $ 200 | $ 200 | $ 200 |
Business Segments (Details)
Business Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Segments | |||
Revenue | $ 191,149 | $ 153,359 | $ 119,216 |
Loss (income) from equity method investments | 6,777 | (3,449) | (426) |
(Gain) loss on disposal of businesses | (6,723) | 5,334 | |
Impairment of goodwill, intangibles and long-lived assets | 780 | ||
Depreciation and amortization | 15,174 | 10,302 | 8,717 |
Operating income (loss) | (25,178) | (33,616) | (18,487) |
Gain on sale of discontinued operations | 7,919 | 176,799 | 31,806 |
Expenditures for long-lived assets | (1,554) | (5,322) | (7,276) |
Total assets | 602,175 | 703,546 | 540,521 |
Technology - Enabled Services | |||
Business Segments | |||
Revenue | 124,068 | 91,730 | 76,192 |
Loss (income) from equity method investments | 4,010 | (672) | 114 |
Impairment of goodwill, intangibles and long-lived assets | 780 | ||
Depreciation and amortization | 14,645 | 9,758 | 8,285 |
Operating income (loss) | (854) | 2,984 | 2,996 |
Expenditures for long-lived assets | (1,166) | (928) | (912) |
Total assets | 213,672 | 219,810 | 126,627 |
Energy | |||
Business Segments | |||
Revenue | 68,922 | 57,563 | 39,490 |
Loss (income) from equity method investments | 2,885 | (2,263) | (327) |
(Gain) loss on disposal of businesses | (4,424) | ||
Depreciation and amortization | 529 | 480 | 401 |
Operating income (loss) | 2,216 | 3,702 | 2,744 |
Expenditures for long-lived assets | (388) | (727) | (510) |
Total assets | 47,330 | 60,641 | 44,288 |
Corporate and Other | |||
Business Segments | |||
Revenue | (1,841) | 4,066 | 3,534 |
Loss (income) from equity method investments | (118) | (514) | (213) |
(Gain) loss on disposal of businesses | (2,299) | 5,334 | |
Depreciation and amortization | 64 | 31 | |
Operating income (loss) | (26,540) | (40,302) | (24,227) |
Gain on sale of discontinued operations | 7,919 | 176,799 | 31,806 |
Expenditures for long-lived assets | (3,667) | (5,854) | |
Total assets | $ 341,173 | $ 423,095 | $ 369,606 |
Subsequent events (Details)
Subsequent events (Details) $ in Millions | Jan. 06, 2023 USD ($) |
Subsequent events | HPI | ALN Management Company | |
Subsequent Event [Line Items] | |
Consideration transferred | $ 21.9 |