Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2022 | May 10, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-39933 | |
Entity Registrant Name | urban-gro, Inc. | |
Entity Central Index Key | 0001706524 | |
Entity Tax Identification Number | 46-5158469 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 1751 Panorama Point | |
Entity Address, Address Line Two | Unit G | |
Entity Address, City or Town | Lafayette | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80026 | |
City Area Code | (720) | |
Local Phone Number | 390-3880 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | UGRO | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 10,637,040 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 27,052,203 | $ 34,592,190 |
Accounts receivable, net | 13,467,120 | 13,125,685 |
Inventories | 354,320 | 514,756 |
Prepaid expenses and other current assets | 10,081,436 | 11,248,266 |
Total current assets | 50,955,079 | 59,480,897 |
Non-current assets: | ||
Property and equipment, net | 207,638 | 207,496 |
Operating lease right of use assets, net | 693,524 | 689,704 |
Investments | 4,210,358 | 4,210,358 |
Goodwill | 7,992,121 | 7,992,121 |
Intangible assets, net | 1,412,965 | 1,575,466 |
Total non-current assets | 14,516,606 | 14,675,145 |
Total assets | 65,471,685 | 74,156,042 |
Current liabilities: | ||
Accounts payable | 7,930,985 | 6,066,896 |
Accrued expenses | 3,106,790 | 3,878,278 |
Customer deposits | 7,234,914 | 13,345,451 |
Contingent consideration | 1,563,000 | 1,563,000 |
Operating lease liabilities | 219,836 | 152,459 |
Total current liabilities | 20,055,525 | 25,006,084 |
Non-current liabilities: | ||
Operating lease liabilities | 474,862 | 542,003 |
Deferred tax liability | 332,565 | 440,625 |
Total non-current liabilities | 807,427 | 982,628 |
Total liabilities | 20,862,952 | 25,988,712 |
Preferred stock, $0.10 par value; 10,000,000 shares authorized; 0 shares issued and outstanding | ||
Common stock, $0.001 par value; 100,000,000 shares authorized; 11,627,528 issued and 10,353,525 outstanding as of March 31, 2022, and 11,588,110 issued and 10,733,195 outstanding as of December 31, 2021 | 11,628 | 11,588 |
Additional paid in capital | 79,589,977 | 78,679,220 |
Treasury shares, cost basis: 1,274,003 shares as of March 31, 2022 and 854,915 shares as of December 31, 2021 | (11,456,667) | (7,683,490) |
Accumulated deficit | (23,536,205) | (22,839,988) |
Total shareholders’ equity | 44,608,733 | 48,167,330 |
Total liabilities and shareholders’ equity | $ 65,471,685 | $ 74,156,042 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.10 | $ 0.10 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Common Stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 11,627,528 | 11,588,110 |
Common stock, shares outstanding | 10,353,525 | 10,733,195 |
Treasury Stock, Shares | 1,274,003 | 854,915 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue | ||
Total Revenue | $ 21,052,869 | $ 12,034,358 |
Cost of Revenue | 16,150,849 | 9,393,713 |
Gross profit | 4,902,020 | 2,640,645 |
Operating expenses: | ||
General and administrative | 4,887,801 | 2,197,009 |
Stock-based compensation | 882,000 | 290,805 |
Total operating expenses | 5,769,801 | 2,487,814 |
Income (loss) from operations | (867,781) | 152,831 |
Non-operating income (expenses): | ||
Interest expense | (7,658) | (317,443) |
Interest income | 79,852 | |
Interest expense – beneficial conversion of notes payable | (636,075) | |
Loss on extinguishment of debt | (790,723) | |
Other income (expense) | (8,690) | 2,828 |
Total non-operating income (expenses) | 63,504 | (1,741,413) |
Income (loss) before income taxes | (804,277) | (1,588,582) |
Deferred income tax benefit | 108,060 | |
Net income (loss) | (696,217) | (1,588,582) |
Comprehensive income (loss) | $ (696,217) | $ (1,588,582) |
Earnings (loss) per share: | ||
Net loss per share - basic and diluted | $ (0.07) | $ (0.20) |
Weighted average shares used in computation | 10,508,972 | 7,831,959 |
Equipment Systems [Member] | ||
Revenue | ||
Total Revenue | $ 17,067,344 | $ 11,344,752 |
Service [Member] | ||
Revenue | ||
Total Revenue | 3,638,507 | 260,513 |
Consumable Products [Member] | ||
Revenue | ||
Total Revenue | $ 347,018 | $ 429,093 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Shareholders' Equity (Deficit) (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 4,719 | $ 14,553,438 | $ (21,964,321) | $ (7,406,164) | |
Beginning balance, shares at Dec. 31, 2020 | 4,718,714 | ||||
Stock-based compensation | 290,805 | 290,805 | |||
Treasury stock | 2,975,000 | 2,975,000 | |||
Stock issued with exercise of warrants | $ 18 | 9,978 | 9,996 | ||
Stock issued with exercise of warrants, shares | 18,412 | ||||
Net income (loss) | (1,588,582) | (1,588,582) | |||
Beneficial conversion feature | 636,075 | 636,075 | |||
Conversion of Bridge Financing | $ 254 | 1,907,971 | 1,908,225 | ||
Conversion of Bridge Financing, shares | 254,425 | ||||
Stock grant program vesting | $ 17 | (17) | |||
Stock grant program vesting, shares | 16,586 | ||||
Stock issuance related to offering, net of offering costs of $4,400,683 | $ 6,210 | 57,693,107 | 57,699,317 | ||
Stock issuance related to offering, net of offering costs of $4,400,683, shares | 6,210,000 | ||||
Treasury stock | (2,975,000) | (2,975,000) | |||
Ending balance, value at Mar. 31, 2021 | $ 11,218 | 75,091,357 | (23,552,903) | (2,975,000) | 48,574,672 |
Ending balance, shares at Mar. 31, 2021 | 11,218,137 | ||||
Beginning balance, value at Dec. 31, 2021 | $ 11,588 | 78,679,220 | (22,839,988) | (7,683,490) | 48,167,330 |
Beginning balance, shares at Dec. 31, 2021 | 11,588,110 | ||||
Stock-based compensation | 882,000 | 882,000 | |||
Treasury stock | (3,773,177) | (3,773,177) | |||
Stock options exercised | $ 5 | 28,792 | $ 28,797 | ||
Stock Options Exercised, shares | 4,555 | 4,555 | |||
Stock issued with exercise of warrants | $ 35 | (35) | |||
Stock issued with exercise of warrants, shares | 34,863 | ||||
Net income (loss) | (696,217) | (696,217) | |||
Treasury stock | 3,773,177 | 3,773,177 | |||
Ending balance, value at Mar. 31, 2022 | $ 11,628 | $ 79,589,977 | $ (23,536,205) | $ (11,456,667) | $ 44,608,733 |
Ending balance, shares at Mar. 31, 2022 | 11,627,528 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity (Deficit) (Unaudited) (Parenthetical) | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Issuance of net offering cost | $ 4,400,683 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash Flows from Operating Activities | ||
Net income (loss) | $ (696,217) | $ (1,588,582) |
Adjustments to reconcile net income (loss) from operations: | ||
Depreciation and amortization | 218,278 | 55,685 |
Amortization of deferred financing costs | 103,632 | |
Loss on extinguishment of debt | 790,723 | |
Interest on convertible notes | 53,725 | |
Stock-based compensation expense | 882,000 | 290,805 |
Beneficial conversion of Bridge notes | 636,075 | |
Inventory write-offs | (69,667) | 14,539 |
Bad debt expense | 12,746 | 15,000 |
Changes in operating assets and liabilities (net of acquired amounts): | ||
Accounts receivable | (354,181) | 204,242 |
Inventories | 230,103 | (111,770) |
Prepayments and other assets | 1,209,576 | (1,178,239) |
Accounts payable and accrued expenses | 1,092,601 | 1,162,059 |
Operating leases | (33,913) | |
Deferred tax liability | (108,060) | |
Customer deposits | (6,110,537) | (149,412) |
Net Cash Provided By (Used In) Operating Activities | (3,727,271) | 298,482 |
Cash Flows from Investing Activities | ||
Purchases of property and equipment | (32,336) | |
Net Cash Used In Investing Activities | (32,336) | |
Cash Flows from Financing Activities | ||
Proceeds from issuance of Common Stock, net of offering costs | 28,797 | 58,170,696 |
Repurchase of Common Stock | (3,773,177) | (2,975,000) |
Repayment of notes payable | (5,755,845) | |
Payment of finance lease ROU liability | (36,000) | |
Net Cash Provided By (Used In) Financing Activities | (3,780,380) | 49,439,851 |
Net Increase (Decrease) in Cash | (7,539,987) | 49,738,333 |
Cash at Beginning of Period | 34,592,190 | 184,469 |
Cash at End of Period | 27,052,203 | 49,922,802 |
Supplemental Cash Flow Information: | ||
Interest paid | 7,658 | 317,443 |
Income taxes | ||
Operating lease right of use asset | $ 55,120 |
ORGANIZATION AND ACQUISITIONS,
ORGANIZATION AND ACQUISITIONS, BUSINESS PLAN, AND LIQUIDITY | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND ACQUISITIONS, BUSINESS PLAN, AND LIQUIDITY | NOTE 1 – ORGANIZATION AND ACQUISITIONS, BUSINESS PLAN, AND LIQUIDITY Organization urban-gro, Inc. (“our,” the “Company,” or “urban-gro”) is a fully integrated architectural design, engineering, procurement, and construction management (“E.P.C.”) design-build firm specializing in the indoor controlled environment agriculture (“CEA”) industry. To serve our horticulture clients, we engineer and design indoor CEA facilities and then integrate complex environmental equipment systems into those facilities. Through this work, we create high-performance indoor cultivation facilities for our clients to grow specialty crops, including leafy greens, vegetables, herbs, and plant-based medicines. Our custom-tailored approach to design, procurement, and equipment integration provides a single point of accountability across all aspects of indoor growing operations. We also help our clients achieve operational efficiency and economic advantages through a full spectrum of professional services and programs focused on facility optimization and environmental health which establish facilities that allow clients to manage, operate and perform at the highest level throughout their entire cultivation lifecycle once they are up and running. We also serve a broad range of commercial and governmental entities, providing them with planning, consulting, architectural and engineering design services for their facilities. We aim to work with our clients from inception of their project in a way that provides value throughout the life of their facility. We are a trusted partner and advisor to our clients and offer a complete set of engineering and managed services complemented by a vetted suite of select cultivation equipment systems. Acquisitions On June 28, 2021, the Company’s wholly-owned subsidiary, urban-gro Architect Holdings, LLC (the “Buyer”), and the 2WRCO Shareholders, the 2WRGA Shareholders, the MJ12 Shareholders, and the 2WRMS Shareholders (collectively, the “Sellers”), and Sam Andras, an individual (the “Sellers Representative”) entered into a Stock Purchase Agreement (the “Purchase Agreement”), pursuant to which the Buyer would purchase all of the issued and outstanding capital stock of 2WR of Colorado, Inc., a Colorado corporation (“2WRCO”), 2WR of Georgia, Inc., a Georgia corporation (“2WRGA”), MJ12 Design Studio, Inc., a Colorado corporation (“MJ12”) (collectively, the “Purchased Shares”) from the Sellers. In connection with the acquisition of the Purchased Shares, Buyer entered into an affiliate relationship with 2WR of Mississippi, P.C., a Mississippi professional corporation (“2WRMS” and together with 2WRCO, 2WRGA and MJ12, the “2WR Entities”). The transaction closed on July 30, 2021. The Purchased Shares had an initial purchase price of up to $ 7.1 million, which purchase price was subject to customary working capital adjustments (the “Purchase Price”). At closing, the Purchase Price was paid in the form of wire transfer of immediately available funds and the issuance of unregistered shares (the “Closing Payment Shares”) of the Company’s common stock, par value $ 0.001 , which Closing Payment Shares had an aggregate stated value of $ 2.0 million. Additionally, the Purchase Agreement provides for additional earnout payments (“Earnout Payments”) to the Sellers of up to an aggregate amount of $ 2.0 million, payable in cash or unregistered shares of the Company’s Common Stock in the Buyer’s sole discretion. The Earnout Payments are payable quarterly for a two-year period and will be equal to twenty percent of the 2WR Entities’ Quarterly Gross Profit (as defined in the Purchase Agreement). The value of the shares of the Company’s Common Stock issued in the transaction was determined based upon the daily volume weighted average closing price of the Company’s Common Stock in the ten trading days prior to the issuance of such shares. The Company accounted for the acquisition of the 2WR Entities as follows: SCHEDULE OF INITIAL ACQUISITION OF TARGET COMPANIES Purchase Price $ 10,058,536 Allocation of Purchase Price: Cash $ 950,690 Accounts receivable, net $ 1,676,208 Prepayments and other assets $ 42,752 Property and equipment $ 9,351 Goodwill $ 7,090,054 Intangible assets $ 1,762,500 Accrued expenses $ 1,032,394 Deferred tax liability $ 440,625 The following pro forma amounts reflect the Company’s results as if the acquisition of the 2WR Entities had occurred on January 1, 2020. These pro forma amounts have been calculated after applying the Company’s accounting policies and adjusting the results of the acquisition to reflect the additional amortization of intangibles. SCHEDULE OF SUPPLEMENTAL INFORMATION ON UNAUDITED PRO-FORMA BASIC OF ACQUISITION 2022 2021 Three Months Ended March 31, 2022 2021 Revenues 21,052,869 13,748,802 Net income (loss) (696,217 ) (625,803 ) Acquired goodwill from the 2WR Entities represents the value expected to arise from organic growth and an opportunity to expand into a well-established market for the Company. Liquidity and Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business within one year after the date the consolidated financial statements are available to be issued. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Unaudited Condensed Consolidated Financial Statements The Company has prepared the accompanying condensed consolidated financial statements pursuant to the rules and regulations of the SEC for condensed financial reporting. The condensed consolidated financial statements are unaudited and, in the Company’s opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations and comprehensive income (loss), condensed consolidated statements of shareholders’ equity (deficit) and condensed consolidated statements of cash flows for the periods presented. The results reported in these condensed consolidated financial statements should not be regarded as necessarily indicative of results that may be expected for the entire year. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted in accordance with regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Significant Accounting Policies For a detailed discussion about the Company’s significant accounting policies, refer to Note 2 — “Summary of Significant Accounting Policies,” in the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. During the three months ended March 31, 2022, there were no material changes made to the Company’s significant accounting policies. Use of Estimates In preparing condensed consolidated financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of assets and liabilities at the date of the condensed consolidated financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include: estimated revenues earned under design contracts; estimated useful lives and potential impairment of long-lived assets , intangibles and goodwill; inventory write offs; allowance for deferred tax assets; and allowance for bad debt. Reclassification Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 3 – RELATED PARTY TRANSACTIONS Cloud 9 Support, LLC (“Cloud 9”) is an entity owned by James Lowe, a director of the 6,207 14,006 5,807 4,263 |
PREPAYMENTS AND OTHER ASSETS
PREPAYMENTS AND OTHER ASSETS | 3 Months Ended |
Mar. 31, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAYMENTS AND OTHER ASSETS | NOTE 4 – PREPAYMENTS AND OTHER ASSETS Prepayments and other assets are comprised of prepayments paid to vendors to initiate orders and prepaid services and fees. The prepaid balances are summarized as follows: SCHEDULE OF PREPAID BALANCES March 31, 2022 December 31, 2021 Vendor prepayments $ 9,586,885 $ 10,652,962 Prepaid services and fees 486,752 587,505 Other assets 7,799 7,799 Prepayments and other assets $ 10,081,436 $ 11,248,266 |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENTS | NOTE 5 – INVESTMENTS The components of investments are summarized as follows: SCHEDULE OF COST METHOD INVESTMENTS March 31, 2022 December 31, 2021 Investment in Edyza $ 1,710,358 $ 1,710,358 Investment in XSF 2,500,000 2,500,000 Investment $ 4,210,358 $ 4,210,358 Edyza The Company has a strategic investment in Edyza, Inc. (“Edyza”), a hardware and software technology company that enables dense sensor networks in agriculture, healthcare, and other environments that require precise micro-climate monitoring. The Company measures this investment at cost, less any impairment changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer. XS Financial On October 30, 2021, the Company’s wholly owned subsidiary UGFS, LLC, a Colorado limited liability company (“UGFS”), participated in a convertible note offering of Xtraction Services, Inc., a/k/a XS Financial Inc. (CSE: XSF) (OTCQB: XSHLF) (“XSF”), a specialty finance company providing CAPEX financing solutions, including equipment leasing, to Controlled Environment Agriculture (CEA) companies in the United States. UGFS, LLC invested $ 2,500,000 of a total $ 43,500,000 raised by XSF. The investment is convertible into equity and incurs 9.50 % interest payable in cash ( 8.0 %) and payment-in-kind Notes ( 1.5 %) prior to any Nasdaq listing and 8.0 % interest after any listing, pursuant to the Note Purchase Agreement. The debt matures on October 28, 2023 , with a one-year option to extend the maturity date at the option of XSF. In addition, UGFS received 1,250,000 warrants with a CAD$ 0.45 exercise price pursuant to the Warrant instrument. No value was attributed to the warrants at the time of the investment in XFS. |
GOODWILL & INTANGIBLE ASSETS
GOODWILL & INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL & INTANGIBLE ASSETS | NOTE 6 – GOODWILL & INTANGIBLE ASSETS Goodwill The Company recorded goodwill in conjunction with the initial acquisition of Impact Engineering, Inc. (“Impact”) on March 7, 2019 and the 2WR Entities on July 30, 2021. The goodwill balance as of March 31, 2022 and December 31, 2021 is $ 7,992,121 . Goodwill is not amortized. There is no goodwill for income tax purposes. The Company did not record any impairment charges related to goodwill for the periods ended March 31, 2022 and 2021. Intangible Assets Other Than Goodwill Intangible assets as of March 31, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS March 31, 2022 Cost Accumulated Amortization Net Book Value Finite-lived intangible assets: Customer relationships 834,100 79,438 754,662 Trademarks and trade names 499,000 66,533 432,467 Backlog and Other 445,837 292,568 153,269 Total finite-lived intangible assets: 1,778,937 438,539 1,340,398 Indefinite-lived intangible assets: Patents 44,276 - 44,276 Trade name 28,291 - 28,291 Total Intangible assets, net 1,851,504 438,539 1,412,965 December 31, 2021 Cost Accumulated Amortization Net Book Value Customer relationships 834,100 49,649 784,451 Trademarks and trade names 499,000 41,583 457,417 Backlog and Other 518,404 184,806 333,598 1,851,504 276,039 1,575,466 The estimated future amortization expense for intangible assets subject to amortization as of March 31, 2022, is summarized below: SCHEDULE OF FUTURE AMORTIZATION EXPENSES OF INTANGIBLE ASSETS Estimated Future Amortization Expense Remainder of 2022 308,584 2023 220,601 2024 220,601 2025 220,464 Thereafter 370,148 Total 1,340,398 Amortization expense for intangible assets for the three months ended March 31, 2022 and 2021 was $ 162,500 and $ 168 respectively. |
ACCRUED EXPENSES
ACCRUED EXPENSES | 3 Months Ended |
Mar. 31, 2022 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | NOTE 7 – ACCRUED EXPENSES Accrued expenses are summarized as follows: SCHEDULE OF ACCRUED EXPENSES March 31, December 31, 2022 2021 Accrued operating expenses $ 852,026 $ 628,871 Accrued wages and related expenses 1,060,846 1,887,124 Accrued 401(k) 4,675 23,520 Accrued sales tax payable 1,189,243 1,338,763 Accrued expenses $ 3,106,790 $ 3,878,278 |
RISKS AND UNCERTAINTIES
RISKS AND UNCERTAINTIES | 3 Months Ended |
Mar. 31, 2022 | |
Risks and Uncertainties [Abstract] | |
RISKS AND UNCERTAINTIES | NOTE 8 – RISKS AND UNCERTAINTIES Concentration Risk The table below shows customers who account for 10% or more of the Company’s total revenues and 10% or more of the Company’s accounts receivable for the periods presented: Customers exceeding 10% of revenue: SCHEDULES OF CONCENTRATION OF RISK March 31, March 31, Company Customer Number 2022 2021 C000001462 25 % 31 % C000001140 16 % * C000000114 11 % * C000001472 11 % * C000001660 * 26 % C000001210 * 14 % Customers exceeding 10% of accounts receivable: March 31, December 31, Company Customer Number 2022 2021 C000001462 37 % 41 % C000001140 * 23 % C000000114 50 % * The table below shows vendors who account for 10% or more of the Company’s total purchases and 10% or more of the Company’s accounts payable for the periods presented: Vendors exceeding 10% of purchases: March 31, March 31, Company Vendor Number 2022 2021 V000001029 26 % 18 % V000000453 19 % 14 % V000001372 11 % 15 % V000001326 * 11 % Vendors exceeding 10% of accounts payable: March 31, December 31, Company Vendor Number 2022 2021 V000001029 42 % * V000000453 18 % 20 % V000001372 * 33 % V000001326 * 12 % *Amounts less than 10% Foreign Exchange Risk Although the Company’s revenues and expenses are expected to be predominantly denominated in United States dollars, the Company may be exposed to currency exchange fluctuations. Recent events in the global financial markets have been coupled with increased volatility in the currency markets. Fluctuations in the exchange rate between the U.S. dollar, the Canadian dollar, the Euro, the Swiss franc, and the currency of other regions in which the Company may operate may have a material adverse effect on the Company’s business, financial condition and operating results. The Company may, in the future, establish a program to hedge a portion of the Company’s foreign currency exposure with the objective of minimizing the impact of adverse foreign currency exchange movements. However, even if the Company develops a hedging program, there can be no assurance that it will effectively mitigate currency risks. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 9 – STOCK-BASED COMPENSATION Stock-based compensation expense for the three months ended March 31, 2022 and 2021 was $ 882,000 and $ 290,805 , respectively, based on the vesting schedule of the stock grants and options. The following schedule shows stock grant activity for the three months ended March 31, 2022. SCHEDULE OF STOCK GRANT ACTIVITY Grants unissued as of December 31, 2021 153,673 Grants awarded 311,500 Forfeiture/Cancelled (7,200 ) Grants Vested (16,667 ) Grants unissued as of March 31, 2022 441,306 As of March 31, 2022, the Company has $ 2.2 The following schedule shows stock option activity for the three months ended March 31, 2022. SCHEDULE OF STOCK GRANT VESTING PERIODS Number of Shares Weighted Average Remaining Life (Years) Weighted Average Exercise Price Stock options outstanding as of December 31, 2021 641,337 7.55 $ 6.27 Issued 44,410 9.8 $ 10.48 Expired - - $ - Exercised (4,555 ) - $ 6.00 Stock options outstanding as of March 31, 2022 681,192 7.75 $ 6.63 Stock options exercisable as of March 31, 2022 579,169 7.41 $ 6.44 The fair value of the options is calculated using the Black-Scholes pricing model based on the market value of the underlying common stock at the valuation measurement date of $ 10.48, 10 0.66 100 As of March 31, 2022, the Company has $ 0.7 in unrecognized share-based compensation expense related to these stock options. The aggregate intrinsic value of the options outstanding and exercisable at March 31, 2022 is $ 0 . |
SHAREHOLDERS_ EQUITY
SHAREHOLDERS’ EQUITY | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
SHAREHOLDERS’ EQUITY | NOTE 10 – SHAREHOLDERS’ EQUITY On May 24, 2021, the Board of Directors authorized a stock repurchase program to purchase up to $ 5.0 million of the currently outstanding shares of the Company’s common stock, over a period of 12 months through open market purchases, in compliance with Rule 10b-18 under the Securities Exchange Act of 1934. On January 18, 2022, the Board of Directors authorized a $ 2.0 million increase to the stock repurchase program, to a total of $ 7.0 million. On February 2, 2022, the Board of Directors authorized an additional $ 1.5 million increase to the stock repurchase, to a total of $ 8.5 million. During the three months ended March 31, 2022, the Company repurchased 419,088 shares of common stock at an average price per share of $ 9.02 , for a total price of $ 3.8 924,003 shares of common stock at an average of $ 9.20 per share, for a total price of $ 8.5 million, under this program. During the three months ended March 31, 2021, the Company repurchased 350,000 shares of common stock at an average price of $ 8.50 3.0 |
WARRANTS
WARRANTS | 3 Months Ended |
Mar. 31, 2022 | |
Warrants | |
WARRANTS | NOTE 11 – WARRANTS The following table shows warrant activity for the three months ended March 31, 2022. SCHEDULE OF WARRANT ACTIVITY Number of shares Weighted Average Exercise Price Warrants outstanding as of December 31, 2021 374,088 $ 11.26 Exercised (18,196 ) $ 6.00 Terminated – cashless exercise (44,393 ) $ 6.00 Warrants outstanding as of March 31, 2022 311,499 $ 12.23 Warrants exercisable as of March 31, 2022 311,499 $ 12.23 The weighted-average life of the warrants is 2.6 0 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 12 – INCOME TAXES The Company has experienced losses for both book and tax purposes since inception. The deferred income tax benefit for the three months ended March 31, 2022 relates to the reduction in the deferred tax liability associated with the amortization of the intangible assets from the acquisition of the 2WR Entities. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 13 – SUBSEQUENT EVENTS The Company has evaluated events and transaction occurring subsequent to March 31, 2022 up to the date of this filing of these condensed consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that evaluation. On March 13, 2022, the Company, Emerald Merger Sub, Inc. (“Merger Sub”), Emerald Construction Management, Inc. (“Emerald”), Christopher W. Cullens, Charles W. Cullens, and Green Stone Property LLC (“Green Stone” and, collectively with Christopher W. Cullens and Charles W. Cullens, the “Sellers”), and, solely in his capacity as the Seller Representative, Christopher W. Cullens (the “Seller Representative”) entered into an Acquisition Agreement and Plan of Merger (the “Acquisition Agreement”), pursuant to which Emerald merged with and into Merger Sub and the Company purchased all of Sellers’ membership interest in CTS Strategies, LLC (the “CTS Interest”). The transactions pursuant to the Acquisition Agreement were completed on April 29, 2022. Pursuant to the Acquisition Agreement, the initial purchase price for Emerald (the “Initial Purchase Price”) was $ 5.0 million, consisting of $ 2.5 million in unregistered shares (the “Closing Payment Shares”) of the Company’s common stock, par value $ 0.001 (“Company Common Stock”) and $ 2.5 million of cash, and the purchase price for the CTS Interest was $ 1,000 . The Initial Purchase Price was subject to certain adjustments, including a working capital adjustment. At closing, the Initial Purchase Price was paid in the form of wire transfer of immediately available funds and the issuance of the Closing Payment Shares. Additionally, the Acquisition Agreement provides for additional earnout payments (“Earnout Payments”) to the Sellers of up to an aggregate amount of $ 2.0 million, payable in unregistered shares of Company Common Stock. The Earnout Payments are payable quarterly for a two-year period and will be equal to 35% of the Quarterly Gross Profit of Emerald (as defined in the Acquisition Agreement). The value of the shares of Company Common Stock to be issued for the Closing Payment Shares was determined based upon the daily volume weighted average closing price of the Company Common Stock in the ten trading days prior the signing date of the Acquisition Agreement. The value of the shares of Company Common Stock to be issued for the Earnout Payments are determined based upon the daily volume weighted average closing price of the Company Common Stock in the ten trading days prior to the end of the applicable annual quarter the Quarterly Gross Profit was calculated. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates In preparing condensed consolidated financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of assets and liabilities at the date of the condensed consolidated financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include: estimated revenues earned under design contracts; estimated useful lives and potential impairment of long-lived assets , intangibles and goodwill; inventory write offs; allowance for deferred tax assets; and allowance for bad debt. |
Reclassification | Reclassification Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
ORGANIZATION AND ACQUISITIONS_2
ORGANIZATION AND ACQUISITIONS, BUSINESS PLAN, AND LIQUIDITY (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SCHEDULE OF INITIAL ACQUISITION OF TARGET COMPANIES | SCHEDULE OF INITIAL ACQUISITION OF TARGET COMPANIES Purchase Price $ 10,058,536 Allocation of Purchase Price: Cash $ 950,690 Accounts receivable, net $ 1,676,208 Prepayments and other assets $ 42,752 Property and equipment $ 9,351 Goodwill $ 7,090,054 Intangible assets $ 1,762,500 Accrued expenses $ 1,032,394 Deferred tax liability $ 440,625 |
SCHEDULE OF SUPPLEMENTAL INFORMATION ON UNAUDITED PRO-FORMA BASIC OF ACQUISITION | The following pro forma amounts reflect the Company’s results as if the acquisition of the 2WR Entities had occurred on January 1, 2020. These pro forma amounts have been calculated after applying the Company’s accounting policies and adjusting the results of the acquisition to reflect the additional amortization of intangibles. SCHEDULE OF SUPPLEMENTAL INFORMATION ON UNAUDITED PRO-FORMA BASIC OF ACQUISITION 2022 2021 Three Months Ended March 31, 2022 2021 Revenues 21,052,869 13,748,802 Net income (loss) (696,217 ) (625,803 ) |
PREPAYMENTS AND OTHER ASSETS (T
PREPAYMENTS AND OTHER ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
SCHEDULE OF PREPAID BALANCES | Prepayments and other assets are comprised of prepayments paid to vendors to initiate orders and prepaid services and fees. The prepaid balances are summarized as follows: SCHEDULE OF PREPAID BALANCES March 31, 2022 December 31, 2021 Vendor prepayments $ 9,586,885 $ 10,652,962 Prepaid services and fees 486,752 587,505 Other assets 7,799 7,799 Prepayments and other assets $ 10,081,436 $ 11,248,266 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
SCHEDULE OF COST METHOD INVESTMENTS | The components of investments are summarized as follows: SCHEDULE OF COST METHOD INVESTMENTS March 31, 2022 December 31, 2021 Investment in Edyza $ 1,710,358 $ 1,710,358 Investment in XSF 2,500,000 2,500,000 Investment $ 4,210,358 $ 4,210,358 |
GOODWILL & INTANGIBLE ASSETS (T
GOODWILL & INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS | Intangible assets as of March 31, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS March 31, 2022 Cost Accumulated Amortization Net Book Value Finite-lived intangible assets: Customer relationships 834,100 79,438 754,662 Trademarks and trade names 499,000 66,533 432,467 Backlog and Other 445,837 292,568 153,269 Total finite-lived intangible assets: 1,778,937 438,539 1,340,398 Indefinite-lived intangible assets: Patents 44,276 - 44,276 Trade name 28,291 - 28,291 Total Intangible assets, net 1,851,504 438,539 1,412,965 December 31, 2021 Cost Accumulated Amortization Net Book Value Customer relationships 834,100 49,649 784,451 Trademarks and trade names 499,000 41,583 457,417 Backlog and Other 518,404 184,806 333,598 1,851,504 276,039 1,575,466 |
SCHEDULE OF FUTURE AMORTIZATION EXPENSES OF INTANGIBLE ASSETS | The estimated future amortization expense for intangible assets subject to amortization as of March 31, 2022, is summarized below: SCHEDULE OF FUTURE AMORTIZATION EXPENSES OF INTANGIBLE ASSETS Estimated Future Amortization Expense Remainder of 2022 308,584 2023 220,601 2024 220,601 2025 220,464 Thereafter 370,148 Total 1,340,398 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCRUED EXPENSES | Accrued expenses are summarized as follows: SCHEDULE OF ACCRUED EXPENSES March 31, December 31, 2022 2021 Accrued operating expenses $ 852,026 $ 628,871 Accrued wages and related expenses 1,060,846 1,887,124 Accrued 401(k) 4,675 23,520 Accrued sales tax payable 1,189,243 1,338,763 Accrued expenses $ 3,106,790 $ 3,878,278 |
RISKS AND UNCERTAINTIES (Tables
RISKS AND UNCERTAINTIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Risks and Uncertainties [Abstract] | |
SCHEDULES OF CONCENTRATION OF RISK | The table below shows customers who account for 10% or more of the Company’s total revenues and 10% or more of the Company’s accounts receivable for the periods presented: Customers exceeding 10% of revenue: SCHEDULES OF CONCENTRATION OF RISK March 31, March 31, Company Customer Number 2022 2021 C000001462 25 % 31 % C000001140 16 % * C000000114 11 % * C000001472 11 % * C000001660 * 26 % C000001210 * 14 % Customers exceeding 10% of accounts receivable: March 31, December 31, Company Customer Number 2022 2021 C000001462 37 % 41 % C000001140 * 23 % C000000114 50 % * The table below shows vendors who account for 10% or more of the Company’s total purchases and 10% or more of the Company’s accounts payable for the periods presented: Vendors exceeding 10% of purchases: March 31, March 31, Company Vendor Number 2022 2021 V000001029 26 % 18 % V000000453 19 % 14 % V000001372 11 % 15 % V000001326 * 11 % Vendors exceeding 10% of accounts payable: March 31, December 31, Company Vendor Number 2022 2021 V000001029 42 % * V000000453 18 % 20 % V000001372 * 33 % V000001326 * 12 % *Amounts less than 10% |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
SCHEDULE OF STOCK GRANT ACTIVITY | The following schedule shows stock grant activity for the three months ended March 31, 2022. SCHEDULE OF STOCK GRANT ACTIVITY Grants unissued as of December 31, 2021 153,673 Grants awarded 311,500 Forfeiture/Cancelled (7,200 ) Grants Vested (16,667 ) Grants unissued as of March 31, 2022 441,306 |
SCHEDULE OF STOCK GRANT VESTING PERIODS | The following schedule shows stock option activity for the three months ended March 31, 2022. SCHEDULE OF STOCK GRANT VESTING PERIODS Number of Shares Weighted Average Remaining Life (Years) Weighted Average Exercise Price Stock options outstanding as of December 31, 2021 641,337 7.55 $ 6.27 Issued 44,410 9.8 $ 10.48 Expired - - $ - Exercised (4,555 ) - $ 6.00 Stock options outstanding as of March 31, 2022 681,192 7.75 $ 6.63 Stock options exercisable as of March 31, 2022 579,169 7.41 $ 6.44 |
WARRANTS (Tables)
WARRANTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Warrants | |
SCHEDULE OF WARRANT ACTIVITY | The following table shows warrant activity for the three months ended March 31, 2022. SCHEDULE OF WARRANT ACTIVITY Number of shares Weighted Average Exercise Price Warrants outstanding as of December 31, 2021 374,088 $ 11.26 Exercised (18,196 ) $ 6.00 Terminated – cashless exercise (44,393 ) $ 6.00 Warrants outstanding as of March 31, 2022 311,499 $ 12.23 Warrants exercisable as of March 31, 2022 311,499 $ 12.23 |
SCHEDULE OF INITIAL ACQUISITION
SCHEDULE OF INITIAL ACQUISITION OF TARGET COMPANIES (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Allocation of Purchase Price: | ||
Goodwill | $ 7,992,121 | $ 7,992,121 |
2WR of Colorado, Inc. [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Purchase Price | 10,058,536 | |
Allocation of Purchase Price: | ||
Cash | 950,690 | |
Accounts receivable, net | 1,676,208 | |
Prepayments and other assets | 42,752 | |
Property and equipment | 9,351 | |
Goodwill | 7,090,054 | |
Intangible assets | 1,762,500 | |
Accrued expenses | 1,032,394 | |
Deferred tax liability | $ 440,625 |
SCHEDULE OF SUPPLEMENTAL INFORM
SCHEDULE OF SUPPLEMENTAL INFORMATION ON UNAUDITED PRO-FORMA BASIC OF ACQUISITION (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Revenues | $ 21,052,869 | $ 13,748,802 |
Net income (loss) | $ (696,217) | $ (625,803) |
ORGANIZATION AND ACQUISITIONS_3
ORGANIZATION AND ACQUISITIONS, BUSINESS PLAN, AND LIQUIDITY (Details Narrative) - USD ($) $ / shares in Units, $ in Millions | Jun. 28, 2021 | Mar. 31, 2022 | Dec. 31, 2021 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | |
Purchase Agreement [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Payments to Acquire Businesses, Gross | $ 7.1 | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | ||
Stock Issued During Period, Value, Acquisitions | $ 2 | ||
Earnout Payments | $ 2 | ||
Description for EarnoutPayments | The Earnout Payments are payable quarterly for a two-year period and will be equal to twenty percent of the 2WR Entities’ Quarterly Gross Profit (as defined in the Purchase Agreement). |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - Cloud 9 Support, LLC [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Related Party Transaction [Line Items] | ||
Revenue from Related Parties | $ 6,207 | $ 14,006 |
Accounts Receivable, Related Parties, Current | $ 5,807 | $ 4,263 |
SCHEDULE OF PREPAID BALANCES (D
SCHEDULE OF PREPAID BALANCES (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Vendor prepayments | $ 9,586,885 | $ 10,652,962 |
Prepaid services and fees | 486,752 | 587,505 |
Other assets | 7,799 | 7,799 |
Prepayments and other assets | $ 10,081,436 | $ 11,248,266 |
SCHEDULE OF COST METHOD INVESTM
SCHEDULE OF COST METHOD INVESTMENTS (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Investments in and Advances to Affiliates [Line Items] | ||
Investment | $ 4,210,358 | $ 4,210,358 |
Edyza [Member] | ||
Investments in and Advances to Affiliates [Line Items] | ||
Investment | 1,710,358 | 1,710,358 |
XSF [Member] | ||
Investments in and Advances to Affiliates [Line Items] | ||
Investment | $ 2,500,000 | $ 2,500,000 |
INVESTMENTS (Details Narrative)
INVESTMENTS (Details Narrative) shares in Thousands | Oct. 30, 2021USD ($)shares | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) | Oct. 30, 2021$ / shares |
Investments in and Advances to Affiliates [Line Items] | ||||
Investments | $ 4,210,358 | $ 4,210,358 | ||
XS Financial [Member] | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Investments | $ 2,500,000 | |||
Capital rasied | $ 43,500,000 | |||
Conversion of debt into equity percentage | 9.50% | |||
Debt Instrument, Maturity Date | Oct. 28, 2023 | |||
Class of Warrant or Right, Outstanding | shares | 1,250,000,000 | |||
XS Financial [Member] | Warrant [Member] | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Share Price | $ / shares | $ 0.45 | |||
XS Financial [Member] | Note Purchase Agreement [Member] | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Conversion of debt into equity percentage | 8.00% | |||
XS Financial [Member] | Note Purchase Agreement [Member] | Payment in Kind (PIK) Note [Member] | ||||
Investments in and Advances to Affiliates [Line Items] | ||||
Conversion of debt into equity percentage | 1.50% |
SCHEDULE OF FINITE-LIVED INTANG
SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite lived intangible assets Cost | $ 1,778,937 | $ 1,851,504 |
Finite lived intangible assets accumulated amortization | 438,539 | 276,039 |
Finite lived intangible assets net book value | 1,340,398 | |
Indefinite lived intangible assets Cost | 1,851,504 | |
Indefinite lived intangible assets accumulated amortization | 438,539 | |
Finite lived intangible assets net book value | 1,412,965 | 1,575,466 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite lived intangible assets Cost | 834,100 | 834,100 |
Finite lived intangible assets accumulated amortization | 79,438 | 49,649 |
Finite lived intangible assets net book value | 754,662 | |
Finite lived intangible assets net book value | 784,451 | |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite lived intangible assets Cost | 499,000 | 499,000 |
Finite lived intangible assets accumulated amortization | 66,533 | 41,583 |
Finite lived intangible assets net book value | 432,467 | |
Finite lived intangible assets net book value | 457,417 | |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite lived intangible assets Cost | 445,837 | 518,404 |
Finite lived intangible assets accumulated amortization | 292,568 | 184,806 |
Finite lived intangible assets net book value | 153,269 | |
Finite lived intangible assets net book value | $ 333,598 | |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite lived intangible assets Cost | 44,276 | |
Indefinite lived intangible assets accumulated amortization | ||
Indefinite lived intangible assets net book value | 44,276 | |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite lived intangible assets Cost | 28,291 | |
Indefinite lived intangible assets accumulated amortization | ||
Finite lived intangible assets net book value | $ 28,291 |
SCHEDULE OF FUTURE AMORTIZATION
SCHEDULE OF FUTURE AMORTIZATION EXPENSES OF INTANGIBLE ASSETS (Details) | Mar. 31, 2022USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2022 | $ 308,584 |
2023 | 220,601 |
2024 | 220,601 |
2025 | 220,464 |
Thereafter | 370,148 |
Total | $ 1,340,398 |
GOODWILL & INTANGIBLE ASSETS (D
GOODWILL & INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 7,992,121 | $ 7,992,121 | |
Amortization of Intangible Assets | $ 162,500 | $ 168 |
SCHEDULE OF ACCRUED EXPENSES (D
SCHEDULE OF ACCRUED EXPENSES (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accrued operating expenses | $ 852,026 | $ 628,871 |
Accrued wages and related expenses | 1,060,846 | 1,887,124 |
Accrued 401(k) | 4,675 | 23,520 |
Accrued sales tax payable | 1,189,243 | 1,338,763 |
Accrued expenses | $ 3,106,790 | $ 3,878,278 |
SCHEDULES OF CONCENTRATION OF R
SCHEDULES OF CONCENTRATION OF RISK (Details) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
C000001462 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 25.00% | 31.00% |
C000001462 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 37.00% | 41.00% |
C000001140 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 16.00% | |
C000001140 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 23.00% | |
C000000114 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 11.00% | |
C000000114 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 50.00% | |
C000001472 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 11.00% | |
C000001660 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 26.00% | |
C000001210 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 14.00% | |
V000001029 [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 26.00% | 18.00% |
V000001029 [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 42.00% | |
V000000453 [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 19.00% | 14.00% |
V000000453 [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 18.00% | 20.00% |
V000001372 [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 11.00% | 15.00% |
V000001372 [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 33.00% | |
V000001326 [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 11.00% | |
V000001326 [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 12.00% |
SCHEDULE OF STOCK GRANT ACTIVIT
SCHEDULE OF STOCK GRANT ACTIVITY (Details) | 3 Months Ended |
Mar. 31, 2022shares | |
Share-Based Payment Arrangement [Abstract] | |
Grants outstanding, beginning | 153,673 |
Grants awarded | 311,500 |
Forfeiture/Cancelled | (7,200) |
Grants Vested | (16,667) |
Grants outstanding, ending | 441,306 |
SCHEDULE OF STOCK GRANT VESTING
SCHEDULE OF STOCK GRANT VESTING PERIODS (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Share-Based Payment Arrangement [Abstract] | |
Stock options outstanding, Number of shares, beginning | shares | 641,337 |
Stock options outstanding, Weighted Average Remaining Life (Years) | 7 years 6 months 18 days |
Stock options outstanding, Weighted Average Exercise Price, Beginning | $ / shares | $ 6.27 |
Issued, Number of shares | shares | 44,410 |
Issued, Weighted Average Remaining Life (Years) | 9 years 9 months 18 days |
Issued, Weighted Average Exercise Price | $ / shares | $ 10.48 |
Expired, Number of shares | shares | |
Expired, Weighted Average Remaining Life (Years) | |
Expired, Weighted Average Exercise Price | $ / shares | |
Exercised, Number of shares | shares | (4,555) |
Exercised, Weighted Average Exercise Price | $ / shares | $ 6 |
Stock options outstanding, Number of shares, ending | shares | 681,192 |
Stock options outstanding, Weighted Average Remaining Life (Years) | 7 years 9 months |
Stock options outstanding, Weighted Average Exercise Price, Ending | $ / shares | $ 6.63 |
Stock options exercisable | shares | 579,169 |
Stock options exercisable, Weighted Average Remaining Life (Years) | 7 years 4 months 28 days |
Stock options exercisable, Weighted Average Exercise Price | $ / shares | $ 6.44 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 882,000 | $ 290,805 |
Unrecognized share-based compensation expense | 2,200,000 | |
Aggregate intrinsic value of options outstanding and exercisable | 0 | |
Share-Based Payment Arrangement, Option [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Unrecognized share-based compensation expense | $ 700,000 | |
Share price | $ 10.48 | |
Remaining contractual term | 10 years | |
Rsk-free interest rate | 0.66% | |
Expected volatility rate | 100.00% |
SHAREHOLDERS_ EQUITY (Details N
SHAREHOLDERS’ EQUITY (Details Narrative) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||||
Mar. 31, 2022 | Mar. 31, 2021 | Feb. 02, 2022 | Jan. 18, 2022 | May 24, 2021 | |
Stock Repurchase Program [Member] | |||||
Class of Stock [Line Items] | |||||
Stock Repurchased During Period, Shares | 924,003 | 350,000 | |||
Share Price | $ 9.20 | $ 8.50 | |||
Stock Repurchased During Period, Value | $ 8.5 | $ 3 | |||
Common Stock [Member] | Stock Repurchase Program [Member] | |||||
Class of Stock [Line Items] | |||||
Stock Repurchased During Period, Shares | 419,088 | ||||
Share Price | $ 9.02 | ||||
Stock Repurchased During Period, Value | $ 3.8 | ||||
Board of Directors [Member] | |||||
Class of Stock [Line Items] | |||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 8.5 | $ 7 | |||
Board of Directors [Member] | Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Stock Repurchase Program, Authorized Amount | $ 1.5 | $ 2 | $ 5 |
SCHEDULE OF WARRANT ACTIVITY (D
SCHEDULE OF WARRANT ACTIVITY (Details) - Warrant [Member] | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Offsetting Assets [Line Items] | |
Number of shares, Warrants outstanding beginning | shares | 374,088 |
Weighted Average Exercise Price, Balance beginning | $ / shares | $ 11.26 |
Number of shares, Warrants Exercised | shares | (18,196) |
Weighted Average Exercise Price, Warrants Exercised | $ / shares | $ 6 |
Number of shares, Warrants terminated cashless exercise | shares | (44,393) |
Weighted Average Exercise Price, Warrants terminated cashless exercise | $ / shares | $ 6 |
Number of shares, Warrants outstanding ending | shares | 311,499 |
Weighted Average Exercise Price, Balance ending | $ / shares | $ 12.23 |
Number of shares, Warrants exercisable | shares | 311,499 |
Weighted Average Exercise Price, Warrants exercisable | $ / shares | $ 12.23 |
WARRANTS (Details Narrative)
WARRANTS (Details Narrative) | Mar. 31, 2022USD ($) |
Warrants | |
Warrant term | 2 years 7 months 6 days |
Aggregate intrinsic value outstanding and exercisable amount | $ 0 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Mar. 13, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | |
Acquisition Agreement [Member] | CTS Strategies LLC [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Business Combination, Consideration Transferred | $ 5,000,000 | ||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 2,500,000 | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | ||
Payments to Acquire Businesses, Gross | $ 2,500,000 | ||
[custom:BusinessCombinationConsiderationTransferredInterest] | $ 1,000 | ||
Business Acquisition, Description of Acquired Entity | the Acquisition Agreement provides for additional earnout payments (“Earnout Payments”) to the Sellers of up to an aggregate amount of $ | ||
Acquisition Agreement [Member] | CTS Strategies LLC [Member] | Earnout Payment [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 2,000,000 |