Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 25, 2020 | Jun. 30, 2019 | |
Entity Registrant Name | Andover National Corp | ||
Entity Central Index Key | 0001712543 | ||
Trading Symbol | AANC | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
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 Shell Company | false | ||
Entity Ex Transition Period | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Public Float | $ 0 | ||
Class A Common stock | |||
Entity Common Stock, Shares Outstanding | 1,892,998 | ||
Class B Common stock | |||
Entity Common Stock, Shares Outstanding | 81,198 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Dec. 31, 2018 | |
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor |
Current assets: | ||
Cash | $ 11,407,971 | $ 899,653 |
Accounts receivable, net | 160,803 | 146,811 |
Prepaid Expense and Other Assets, Current | 31,702 | |
Total current assets | 11,600,476 | 1,046,464 |
Non-current assets: | ||
Property and equipment, net | 245,953 | 261,378 |
Right-of-use asset, net | 220,294 | |
Goodwill | 4,309,766 | |
Intangible assets, net | 1,881,208 | |
Total non-current assets | 6,657,221 | 261,378 |
TOTAL ASSETS | 18,257,697 | 1,307,842 |
Current liabilities: | ||
Accounts payable and accrued expenses | 587,584 | 50,009 |
Current portion of deferred consideration | 200,000 | |
Notes payable | 20,473 | |
Lease liabilities | 42,970 | |
Total current liabilities | 830,554 | 70,482 |
Non-current liabilities: | ||
Lease liabilities, net of current portion | 177,324 | |
Deferred consideration, net of current portion | 300,000 | |
Total non-current liabilities | 477,324 | |
Total Liabilities | 1,307,878 | 70,482 |
Stockholders' equity: | ||
Common stock | 600 | |
Additional paid-in capital | 17,554,713 | 72,757 |
Accumulated deficit | (3,334,086) | 1,164,003 |
Total Stockholders' Equity (Deficit) | 14,222,392 | 1,237,360 |
Stockholders' Equity Attributable to Noncontrolling Interest | 2,727,427 | |
Total equity | 16,949,819 | 1,237,360 |
TOTAL LIABILITIES AND EQUITY | 18,257,697 | $ 1,307,842 |
Class A Common stock | ||
Stockholders' equity: | ||
Common stock | 1,684 | |
Class B Common stock | ||
Stockholders' equity: | ||
Common stock | $ 81 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 |
Preferred stock, par value | $ 0.001 | ||
Preferred stock, shares authorized | 5,000,000 | ||
Preferred stock, shares outstanding | 0 | ||
Common stock, par value | $ 1 | ||
Common stock, shares authorized | 600 | ||
Common Stock, shares issued | 600 | ||
Common Stock, shares outstanding | 600 | ||
Class A Common stock | |||
Common stock, par value | $ 0.001 | ||
Common stock, shares authorized | 60,000,000 | ||
Common Stock, shares issued | 1,683,691 | ||
Common Stock, shares outstanding | 1,683,691 | ||
Class B Common stock | |||
Common stock, par value | $ 0.001 | ||
Common stock, shares authorized | 7,500,000 | ||
Common Stock, shares issued | 81,198 | ||
Common Stock, shares outstanding | 81,198 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Revenue | $ 683,265 | $ 1,957,025 | $ 2,235,237 |
Total revenues | 683,265 | 1,957,025 | 2,235,237 |
Operating costs and expenses: | |||
Cost of services provided | 280,847 | 928,275 | 1,154,764 |
General and Administrative Expense | 1,491,902 | 586,092 | 547,293 |
Selling and Marketing Expense | 12,003 | 117,352 | 99,303 |
Total operating costs and expenses | 1,784,752 | 1,631,719 | 1,801,360 |
Income (loss) from operations | (1,101,487) | 325,306 | 433,877 |
Other income (expense): | |||
Investment income | 37,589 | ||
Other income | 809 | 120,644 | |
Interest income | 94 | 3,858 | |
Interest expense | (345) | (1,122) | |
Total other income (expense) | 38,492 | 124,157 | (1,122) |
Net income (loss) | (1,062,995) | 449,463 | 432,755 |
Less: Net income attributable to noncontrolling interest | 60,760 | ||
Net income (loss) attributable to common shareholders | $ (1,123,755) | $ 449,463 | $ 432,755 |
Net loss per common share | |||
Net loss per share attributable to Class A and Class B Common shareholders- Basic | $ (0.70) | ||
Net loss per share attributable to Class A and Class B Common shareholders- Diluted | $ (0.70) | ||
Weighted average shares outstanding | |||
Weighted average Class A and Class B Common shares outstanding- Basic | 1,612,172 | ||
Weighted average Class A and Class B Common shares outstanding- Diluted | 1,612,172 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) | Class A Common stockCommon Stock | Class B Common stockCommon Stock | Parent [Member] | Common Stock | Additional Paid-In Capital | Retained Earnings / Accumulated Deficit | Noncontrolling Interest [Member] | Total |
Beginning balance at Dec. 31, 2017 | $ 600 | $ 25,983 | $ 815,005 | $ 841,588 | ||||
Beginning balance, shares at Dec. 31, 2017 | 600 | |||||||
Shareholder contribution (distribution) | 46,774 | (83,757) | (36,983) | |||||
Net income (loss) | 432,755 | 432,755 | ||||||
Ending balance at Dec. 31, 2018 | 1,237,360 | |||||||
Ending balance at Dec. 31, 2018 | $ 600 | 72,757 | 1,164,003 | 1,237,360 | ||||
Ending balance, shares at Dec. 31, 2018 | 600 | |||||||
Shareholder contribution (distribution) | (1,247,448) | (1,247,448) | ||||||
Net income (loss) | 449,463 | 449,463 | ||||||
Ending balance at Oct. 03, 2019 | $ 600 | 72,757 | 366,018 | 439,375 | ||||
Ending balance, shares at Oct. 03, 2019 | 600 | |||||||
Net income (loss) | (1,062,995) | |||||||
Ending balance at Dec. 31, 2019 | $ 1,684 | $ 81 | $ 14,222,392 | 17,554,713 | (3,334,086) | $ 2,727,427 | 16,949,819 | |
Ending balance at Dec. 31, 2019 | 14,222,392 | |||||||
Ending balance, shares at Dec. 31, 2019 | 1,683,691 | 81,198 | ||||||
Beginning balance at Oct. 04, 2019 | $ 1,461 | $ 122 | 13,139,646 | 15,348,394 | (2,210,331) | 13,139,646 | ||
Beginning balance, shares at Oct. 04, 2019 | 1,460,757 | 121,797 | ||||||
Impact on non-controlling interest from acquisition of ANC Green Solutions I | 2,666,667,000 | 2,666,667,000 | ||||||
Common stock issued for cash | $ 182 | 2,005,662 | 2,005,480 | 2,005,662 | ||||
Common stock issued for cash, shares | 182,335 | |||||||
Stock-based compensation | 200,839 | 200,839 | 200,839 | |||||
Issuance of Class A Common Stock in conversion of Class B Common Stock | $ 41 | $ (41) | ||||||
Issuance of Class A Common Stock in conversion of Class B Common Stock (in shares) | 40,599 | (40,599) | ||||||
Net income (loss) | (1,123,755) | (1,123,755) | 60,760 | (1,062,995) | ||||
Ending balance at Dec. 31, 2019 | $ 1,684 | $ 81 | $ 14,222,392 | $ 17,554,713 | $ (3,334,086) | $ 2,727,427 | 16,949,819 | |
Ending balance at Dec. 31, 2019 | $ 14,222,392 | |||||||
Ending balance, shares at Dec. 31, 2019 | 1,683,691 | 81,198 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Cash Flows from Operating Activities: | ||||
Net income (loss) | $ (1,062,995) | $ (1,062,995) | $ 449,463 | $ 432,755 |
Reconciliation of net income (loss) to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 100,884 | 62,107 | 85,453 | |
Loss on disposal of fixed asset | 41,485 | |||
Stock-based compensation | 200,839 | |||
Changes in operating assets and liabilities: | ||||
Accounts receivable | 15,902 | (29,894) | (36,670) | |
Prepaid expenses and other current assets | (2,400) | (9,643) | ||
Accounts payable and accrued liabilities | 342,422 | 97,598 | 71 | |
Net cash provided by (used in) operating activities | (405,348) | 611,116 | 481,609 | |
Cash Flows from Investing Activities: | ||||
Purchase of property and equipment | (58,921) | (48,338) | (73,755) | |
Acquisition of ANC Green Solutions I, net of cash acquired | (3,431,837) | |||
Net cash used in investing activities | (3,490,758) | (48,338) | (73,755) | |
Cash Flows from Financing Activities: | ||||
Repayment to note payable | (20,473) | (5,854) | ||
Proceeds from the issuance of shares in private placement | 2,005,662 | |||
Capital distribution | (1,247,448) | (83,757) | ||
Capital contribution | 0 | 46,774 | ||
Net cash provided by (used in) financing activities | 2,005,662 | (1,267,921) | (42,837) | |
Net increase (decrease) in cash | (1,890,444) | (705,143) | 365,017 | |
Cash, beginning of period | 194,510 | 13,298,415 | 899,653 | 534,636 |
Cash, end of period | $ 11,407,971 | 11,407,971 | 194,510 | 899,653 |
Supplemental schedule of noncash financing activities: | ||||
Cash paid for interest | $ 345 | $ 1,122 | ||
Recognition of Noncontrolling Interest | $ 2,666,667 | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Nature of the Business
Nature of the Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of the Business | Note 1 – Nature of the Business Andover National Corporation, (the “Company” or “Successor”) was organized in the State of Utah on July 11, 2007, and reincorporated on March 20, 2014. Effective February 14, 2019, the Company completed a change of domicile to Delaware from Utah (the “Reincorporation”) by means of a merger of the Company with and into the Company’s wholly-owned subsidiary, Andover National Corporation, a Delaware corporation (“Andover”). On October 4, 2019, Andover Environmental Solutions, LLC, a wholly-owned subsidiary of the Company, entered into a Membership Interest Purchase Agreement with Heath L. Legg, pursuant to which Andover Environmental Solutions, LLC purchased sixty percent (60%) of the membership interests of ANC Green Solutions I, LLC, a Delaware limited liability company, for $4,000,000, subject to certain adjustments (the “Business Combination”). ANC Green Solutions I, LLC, formerly known as Legg Holdings, Inc. (“ANC Green Solutions” or “Legg”), is an operator and franchisor of commercial and residential landscaping, lawn care and pest control services, operating under the commercial trade name Superior Services. ANC Green Solution’s core service offerings provide residential homeowners and commercial customers with year-round monitoring and treatment by focusing on weed and insect control, irrigation, seeding, fertilization, general landscape maintenance and installation services. Additionally, ANC Green Solutions is a master franchisor for outdoor insect control service businesses operating independently throughout the United States. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Basis of Presentation These consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company and its consolidated subsidiaries which are directly or indirectly owned by the Company. As a result of the Business Combination, the Company is the acquirer for accounting purposes and ANC Green Solutions is the acquiree and accounting predecessor. The Company’s financial statement presentation distinguishes the Company’s financial performance into two distinct periods, the period up to the closing date of the Business Combination (labeled “Predecessor”) and the period including and after that date (labeled “Successor”). The Business Combination was accounted for as a business combination using the acquisition method of accounting, and the Successor financial statements reflect a new basis of accounting that is based on the fair value of the net assets acquired. Determining the fair value of the assets acquired and liabilities assumed is judgmental in nature and often involves the use of significant estimates and assumptions. See Note 4 – Business Combinations for a discussion of the estimated fair values of assets and liabilities recorded in connection with the Company’s acquisition of ANC Green Solutions. As a result of the application of the acquisition method of accounting as of the closing date of the Business Combination, the accompanying Consolidated Financial Statements include a black line division which indicates that the Predecessor and Successor reporting entities shown are presented on a different basis and are therefore, not comparable. The historical financial information of Andover prior to the Business Combination has not been reflected in the Predecessor financial statements as these historical amounts have been determined to be not useful information to a reader of the financial statements. The operations of Andover, until the closing of a business combination, other than income from investments and general and administrative expenses, were nominal. Accordingly, no other activity in the Company was reported for periods prior to October 4, 2019 besides ANC Green Solutions’ operations as Predecessor. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Management makes estimates that affect certain accounts including deferred income tax assets, accrued expenses, fair value of equity instruments and reserves for any other commitments or contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined. Principles of Consolidation The Company’s policy is to consolidate all entities in which it has a controlling financial interest. For consolidated entities that are less than wholly owned, the third party’s holding of equity interest is presented as noncontrolling interests in the Company’s consolidated balance sheets and consolidated statement of equity. The portion of net income (loss) attributable to the noncontrolling interests is presented as net income (loss) attributable to noncontrolling interests in the Company’s consolidated statement of operations. The accompanying Successor consolidated financial statements include the accounts of Andover National Corporation and its consolidated subsidiary, ANC Green Solutions. The accompanying Predecessor consolidated financial statements include the accounts of ANC Green Solutions and its consolidated subsidiaries, Legg Lawncare, Inc. and Legg SMS Franchising, Inc. All material inter-company balances and transactions have been eliminated. Cash and Cash Equivalents The Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and highly liquid investments with maturities of three months or less from the date of purchase to be cash and cash equivalents. As of December 31, 2019, the Company’s cash equivalents included U.S. Treasury Bills with maturities of 90 days or less. Realized and unrealized gains and losses on highly liquid investments classified as cash equivalents are reported in investment income in the consolidated statement of operations. The Company had no cash equivalents as of December 31, 2018. Concentration of credit risk The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible. Concentrations of credit risk with respect to trade accounts receivable are limited due to the number of customers comprising the customer base. During the period from October 4, 2019 through December 31, 2019 (Successor), the period January 1, 2019 through October 3, 2019 (Predecessor) and year ended December 31, 2018 (Predecessor), no customer accounted for more than 10% of the Company’s total revenue. Accounts Receivable Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company reserves for all accounts that are deemed to be uncollectible and reviews its allowance for doubtful accounts regularly. The allowance is based on the age of receivables and a specific identification of receivables considered at risk. Account balances are written off against the allowance when the potential for recovery is considered remote. The following table provides a roll forward of the allowance for doubtful accounts: Successor Predecessor October 4, 2019 January 1, 2019 through through Year Ended December 31, 2019 October 3, 2019 December 31, 2018 Allowance for doubtful accounts, beginning of period $ — $ 34,976 $ 23,051 Bad debt expense 2,467 — 11,925 Allowance for doubtful accounts, end of period $ 2,467 $ 34,976 $ 34,976 Prepaid expenses and other current assets Prepaid expenses consist of payments that the Company has made in advance for goods or services to be received in the future. Prepaid expenses primarily consist of payments associated with insurance contracts. Property and Equipment Property and equipment, stated at cost, are depreciated using the straight-line method over the estimated useful life of the asset, or for leasehold improvements, over the shorter of the estimated useful life or the lease term. As of December 31, 2019 and 2018, the estimated useful lives (in years) of each of the Company’s classes of property and equipment were as follows: Useful Lives (in years) Vehicles 5‑10 Equipment 5‑7 Leasehold improvements 5 Office equipment 5‑7 Equipment replacement, maintenance and repair costs, which do not extend the lives of the assets, are charged to operating expense as incurred. Impairment of Long-Lived Assets Long-lived assets, which include property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company considers the following to be some examples of important indicators that may trigger an impairment review: (i) historical, current and/ or projected operating or cash flow losses associated with the use of the asset; (ii) significant changes in the extent or manner in which the assets are used; (iii) significant changes in the business climate in which the assets are used, such as negative industry or economic trends, or increased competitive pressures; (iv) a significant decline in the market price of the asset; and (v) legal or regulatory changes. The Company evaluates assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events. The Company does not test for impairment in the year of acquisition of premises and equipment, so long as those premises and equipment are acquired from unrelated third parties. The Company assesses the recoverability of its long-lived assets by comparing the projected undiscounted net cash flows associated with the related long-lived asset or group of long-lived assets over their remaining estimated useful lives against their respective carrying amounts. In cases where estimated future net undiscounted cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of the asset or asset group. Fair value is generally determined using the assets expected future discounted cash flows or market value, if readily determinable. If long- lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated and amortized prospectively over the newly determined remaining estimated useful lives. Leases Effective January 1, 2019, the Company accounts for its leases under Accounting Standard Codification (“ASC”) Topic 842, Leases . The Company determines if an arrangement is a lease at inception. Operating leases are included in right-of-use (“ROU”) assets and lease liabilities on the consolidated balance sheets. Lease ROU assets and operating lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using the Company’s incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. ROU assets also include any lease payments made at or before lease commencement and exclude any lease incentives received. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company accounts for lease and non-lease components as a single lease component for all its leases. The Company does not recognize ROU assets and lease liabilities that arise from leases with an original term of 12 months or less. Rather, the Company recognizes the lease payments associated with these leases on a straight-line basis over the term of the lease. Prior to January 1, 2019, the Company accounted for leases under ASC 840. The Company recorded rent expense associated with its operating leases on a straight-line basis over the term of the lease. Goodwill and Intangible Assets (Successor) Goodwill. Goodwill represents the excess acquisition cost over the fair value of the net tangible and intangible assets acquired. Goodwill is not amortized and is subject to annual impairment testing on or between annual tests if an event or change in circumstance occurs that would more likely than not reduce the fair value of a reporting unit below its carrying value. In testing for goodwill impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is not required. If the Company concludes otherwise, the Company is required to perform the two-step impairment test. The goodwill impairment test is performed at the reporting unit level by comparing the estimated fair value of a reporting unit with its respective carrying value. If the estimated fair value exceeds the carrying value, goodwill at the reporting unit level is not impaired. If the estimated fair value is less than the carrying value, further analysis is necessary to determine the amount of impairment, if any, by comparing the implied fair value of the reporting unit’s goodwill to the carrying value of the reporting unit’s goodwill. Intangible Assets. Intangible assets deemed to have finite lives are amortized on a straight-line basis over their estimated useful lives, where the useful life is the period over which the asset is expected to contribute directly, or indirectly, to the Company’s future cash flows. Intangible assets are reviewed for impairment on an interim basis when certain events or circumstances exist. For amortizable intangible assets, impairment exists when the carrying amount of the intangible asset exceeds its fair value. At least annually, the remaining useful life is evaluated. Business Combinations (Successor) The Company applies the provisions of Accounting Standard Codification (“ASC”) Topic 805, Business Combinations , in the accounting for acquisitions. ASC 805 requires the Company to recognize separately from goodwill the assets acquired and the liabilities assumed at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While the Company uses its best estimates and assumptions to accurately apply preliminary value to assets acquired and liabilities assumed at the acquisition date, where applicable, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments in the current period, rather than a revision to a prior period. Upon the conclusion of the measurement period or final determination of the values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the consolidated statements of operations. Accounting for business combinations requires management to make significant estimates and assumptions, especially at the acquisition date, including estimates for intangible assets, contractual obligations assumed, restructuring liabilities, preacquisition contingencies, and contingent consideration, where applicable. Although the Company believes the assumptions and estimates made have been reasonable and appropriate, they are based in part on historical experience and information obtained from management of the acquired companies and are inherently uncertain. Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates, or actual results. Revenue Recognition The Company recognizes revenue from contracts with customers in accordance with ASC Topic 606, Revenue from Contracts with Customers (the “revenue standard”). The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. A good or service is transferred to a customer when, or as, the customer obtains control of that good or service. The following five steps are applied to achieve that core principle: · Step 1: Identify the contract with the customer · Step 2: Identify the performance obligations in the contract · Step 3: Determine the transaction price · Step 4: Allocate the transaction price to the performance obligation in the contract · Step 5: Recognize revenue when the company satisfies a performance condition The Company’s revenue is primarily generated from residential and commercial lawn care programs and services. The Company generally recognizes revenue from the sale of services as the services are performed, which is typically ratably over the term of the contract(s), which the Company believes to be the best measure of progress. The Company recognizes revenues as it completes services to its customers in an amount reflecting the total consideration it expects to receive from the customer. The Company determined that for contracts containing multiple performance obligations, stand-alone selling price is readily determinable for each performance obligation. The transaction price will include estimates of variable consideration, such as returns and provisions for doubtful accounts and sales incentives, to the extent it is probable that a significant reversal of revenue recognized will not occur. In all cases, when a sale is recorded by the Company, no significant uncertainty exists surrounding the purchaser’s obligation to pay. The Company also grants franchises to operators in exchange for an initial franchise license fee and continuing royalty payments. Franchise revenue is recognized over the license term as the Company has determined that all obligations under the franchise agreements represent a single performance obligation that is satisfied over time. Cost of services provided Cost of services provided represents costs directly related to the provision of the lawncare programs and services, and include direct labor, materials and equipment depreciation. The Company recognizes the costs of services provided as the associated revenues are recognized. Share-based compensation (Successor) The Company accounts for its share-based compensation arrangements in accordance with ASC Topic 718, Compensation – Stock Compensation, which requires the measurement of compensation expense for all share-based compensation granted to employees and non-employees at fair value on the date of grant and recognition of compensation expense over the related service period. Forfeitures are accounted for as they occur. Share-based awards with graded-vesting schedules are recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award. Net Income (Loss) Per Common Share (Successor) Basic net income (loss) per share is calculated by dividing the net income (loss) applicable to the common stockholders by the weighted average number of shares of common stock outstanding during the reporting periods. Diluted net income (loss) per share includes the effect, if any, from the potential exercise or conversion of securities, such as warrants and restricted stock units that would result in the issuance of incremental shares of common stock. In computing the basic and diluted net loss per share applicable to common stockholders during the period October 4, 2019 through December 31, 2019, the weighted average number of shares remains the same for both calculations due to the fact that when a net loss exists, dilutive shares are not included in the calculation as the impact is anti-dilutive. Related Party Transactions The Company accounts for related party transactions in accordance with ASC 850, Related Party Disclosures. A party is considered to be related to the Company if the party directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. Fair Value Measurements Fair value measurements are based on the premise that fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the following three-tier fair value hierarchy has been used in determining the inputs used in measuring fair value: Level 1‑ Quoted prices in active markets for identical assets or liabilities on the reporting date. Level 2‑ Pricing inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3‑ Pricing inputs are generally unobservable and include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require management’s judgment or estimation of assumptions that market participants would use in pricing the assets or liabilities. The fair values are therefore determined using factors that involve considerable judgment and interpretations, including but not limited to private and public comparables, third-party appraisals, discounted cash flow models and fund manager estimates. Financial instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Management’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The use of different assumptions and/or estimation methodologies may have a material effect on estimated fair values. Accordingly, the fair value estimates disclosed or initial amounts recorded may not be indicative of the amount that the Company or holders of the instruments could realize in a current market exchange. As of December 31, 2019 and 2018, the recorded values of cash and cash equivalents, accounts receivable, accounts payable and notes payable, approximate the fair values due to the short-term nature of the instruments. Income Taxes Successor Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more-likely than not that some or all of the deferred tax assets will not be realized. The Company also follows the provisions of accounting for uncertainty in income taxes which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition. In accordance with this guidance, tax positions must meet a more-likely than not recognition threshold and measurement attribute for the financial statement recognition and measurement of tax position. The Company’s policy is to account for income tax related interest and penalties in the provision for income taxes in the accompanying consolidated statements of operations. Predecessor The Predecessor’s subsidiaries were Subchapter S pass-through entities for income tax purposes. Accordingly, the Predecessor was not viewed as a taxpaying entity in any jurisdiction and did not require a provision for income taxes. Segment Information The Company operates under one segment which provides residential and commercial lawncare services. Retirement Plans The Company maintains defined benefit contribution retirement plans for eligible employees under Section 401(k) of the Internal Revenue Code. Participants can make voluntary contributions up the Internal Revenue Service limit of $19,000 ($25,000 for employees 50 years or over) for 2019. The Company contributed $5,593, $5,050 and $4,006 during the period October 4, 2019 through December 31, 2019 (Successor), the period January 1, 2019 through October 3, 2019 (Predecessor) and the year ended December 31, 2018 (Predecessor), respectively. Recent Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016‑2, Leases (“ASC 842”). The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, using a modified retrospective approach. The Company adopted ASC 842 on January 1, 2019 using the optional transition method to apply the new guidance as of the date of adoption, rather than as of the earliest period presented. The adoption of ASC 842 on January 1, 2019 did not have an impact on the Company’s consolidated financial statements as the Company did not have any leases with original terms longer than 12 months at the date of adoption. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is effective for fiscal periods beginning after December 15, 2018, including interim periods within those periods. The standard became effective for the Company in the first quarter of 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU 2018‑07, Compensation- Stock Compensation (Topic 718) Improvements to Nonemployee Share-Based Payment Accounting , which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The guidance also specifies that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The Company early adopted this standard as of January 1, 2019. The Company did not grant share-based payment awards during the Predecessor period. Accordingly, the adoption of this standard did not have a material effect on the Company’s consolidated financial statements and related disclosures. Recent Issued Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019‑12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019‑12”), which is intended to simplify various aspects related to accounting for income taxes. ASU 2019‑12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 3 – Revenue The following table presents the Company’s revenue disaggregated by source: Successor Predecessor October 4, 2019 January 1, 2019 through through Year Ended December 31, 2019 October 3, 2019 December 31, 2018 Lawncare service revenue $ 665,323 $ 1,880,694 $ 2,142,043 Franchise revenue 17,942 76,331 93,194 Total revenue $ 683,265 $ 1,957,025 $ 2,235,237 The Company’s revenue is primarily generated from residential and commercial lawn care programs and services, which includes lawncare, landscaping and hardscaping, irrigation, and mosquito, termite and pest control services. The Company generally recognizes revenue from the sale of services as the services are performed, which is typically ratably over the term of the contract(s), which the Company believes to be the best measure of progress. The Company recognizes revenues as it completes services to its customers in an amount reflecting the total consideration it expects to receive from the customer. The Company generally does not offer sales incentives or discounts to customers. Payment terms vary by customer, but payments are generally due at the point of service. The Company incurs certain direct incremental costs to obtain contracts with customers, such as sales-related commissions, where the recognition period for the related revenue is less than one years. These costs are expensed as incurred and recorded with in general and administrative expense in the consolidate statement of operations. The Company also grants franchises to operators in exchange for an initial franchise license fee and continuing royalty payments. Franchise revenue is recognized over the license term as the Company has determined that all obligations under the franchise agreements represent a single performance obligation that is satisfied over time. |
Business Combination (Successor
Business Combination (Successor) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Business Combination (Successor) | Note 4 – Business Combination (Successor) As described in Note 1, on October 4, 2019, the Company acquired sixty percent (60%) of the membership interests of ANC Green Solutions for $4,000,000 in cash, consisting of $3,500,000 paid at the closing of the Business Combination and $500,000 in deferred consideration to be paid on the one- and two- year anniversary of the closing of the Business Combination. The following table presents the preliminary allocation of the purchase price to the assets acquired and liabilities assumed for the acquisition of ANC Green Solutions (in thousands): Accounts receivable $ 176 Prepaid expenses 10 Property and equipment 206 Intangible assets 1,963 Goodwill 4,310 Accounts payable and accrued expenses (66) Deferred cash consideration (500) Non-controlling interest in ANC Solutions (2,667) Cash purchase price, net of cash acquired $ 3,432 The Company identified tradename and customer relationship intangible assets. The tradename and customer relationships will be amortized on a straight-line basis over its estimated useful life (see Note 6). The goodwill recognized results from such factors as an assembled workforce and management’s superior industry know-how and is not expected to be deductible for income tax purposes. The acquisition-date fair value of the noncontrolling interest was determined using a market approach based on the transaction price observed in the Business Combination. The Company recorded approximately $65,000 in transaction costs related to the acquisition of ANC Green Solutions, which are recorded in General and administrative expense in the Consolidated statement of operations for the period October 4, 2019 through December 31, 2019. Unaudited Pro Forma Financial Information The following unaudited pro forma financial information presents the combined results of operations for the Company and gives effect to the Business Combination discussed above as if they had occurred on January 1, 2018. The pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the results of operations that would have been realized if the Business Combinations had been completed on January 1, 2018, nor does it purport to project the results of operations of the combined company in future periods. The pro forma financial information does not give effect to any anticipated integration costs related to the acquired company. Year ended December 31, 2019 December 31, 2018 Total revenue $ 2,640,290 $ 2,235,237 Net loss (2,003,167) (430,624) For purposes of the pro forma disclosures above, the primary adjustments for the year ended December 31, 2019 include the inclusion of amortization of the intangible assets of $245,000 and the elimination of transaction costs of $119,000. For purposes of the pro forma disclosures above, the primary adjustments for the year ended December 31, 2018 include the inclusion of amortization of the intangible assets of $327,000. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 5‑ Property and Equipment Successor Predecessor December 31, 2019 December 31, 2018 Vehicles $ 101,410 $ 377,932 Equipment 119,276 292,272 Leasehold improvements 42,163 9,990 Office equipment 2,196 4,664 Total property and equipment 265,045 684,858 Less: Accumulated depreciation (19,092) (423,480) Property and equipment, net $ 245,953 $ 261,378 Depreciation expense was $19,092 for the period October 4, 2019 through December 31, 2019 (Successor), $62,107 for the period January 1, 2019 through October 3, 2019 (Predecessor) and $85,453 for the year ended December 31, 2018 (Predecessor). |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Successor) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets (Successor) | Note 6‑ Goodwill and Intangible Assets (Successor) As of December 31, 2019, the Company’s goodwill balance of $4,309,766 relates to the Business Combination. There have been no changes to goodwill from initial recognition on October 4, 2019 through December 31, 2019. As of December 31, 2019, the Company’s intangible assets consisted of the following: December 31, 2019 Gross Accumulated Amortization Net Tradenames $ 251,000 $ (10,458) $ 240,542 Customer relationships 1,712,000 (71,334) 1,640,666 $ 1,963,000 $ (81,792) $ 1,881,208 Weighted average amortization period (in years) Tradenames 6 Customer relationships 6 Amortization expense was $81,792 for the successor period October 4, 2019 to December 31, 2019. The estimated aggregate amortization expense for intangible assets over the next five fiscal years and thereafter is as follows: 2020 327,167 2021 327,167 2022 327,167 2023 327,167 2024 327,167 Thereafter 245,373 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Note 7‑ Leases Successor The Company leases a facility under an agreement classified as an operating lease that expires in 2024. The Company’s lease includes renewal options; however, renewal options have not been included in the calculation of the lease liabilities and right of use assets as the Company is not reasonably certain to exercise the options. Leases with an initial term of 12 months or less are not recorded on the balance sheet and expense is recognized on a straight-line basis over the lease term. The Company does not act as a lessor or have any leases classified as financing leases. At December 31, 2019, the Company had operating lease liabilities of $220,294 and right of use assets of $220,294. Lease expenses during the period October 4, 2019 through December 31, 2019 are as follows: Successor October 4, 2019 through December 31, 2019 Operating leases Operating lease cost $ 12,750 Operating lease expense 12,750 Short-term lease rent expense 18,418 Total rent expense $ 31,168 The weighted-average remaining lease term as of December 31, 2019 was 4.75 years. The weighted-average discount rate was 4%. The Company’s maturity of its operating leases are as follows: 2020 $ 51,000 2021 51,000 2022 51,000 2023 51,000 2024 38,250 Thereafter — Total 242,250 Less: Interest (21,956) Present value of lease liabilities $ 220,294 Predecessor Rent expense during the period January 1, 2019 through October 3, 2019 and for the year ended December 31, 2018 was $42,785 and $56,047, respectively. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Liabilities | Note 8 – Accounts Payable and Accrued Liabilities As of December 31, 2019 and 2018, the Company’s accounts payable and accrued liabilities consisted of the following: Successor Predecessor December 31, 2019 December 31, 2018 Accounts payable $ 138,712 $ — Accrued professional fees 235,124 30,212 Accrued franchise tax 200,000 — Accrued payroll 13,748 19,797 Accounts payable and accrued liabilities $ 587,584 $ 50,009 |
Notes Payable (Predecessor)
Notes Payable (Predecessor) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Notes Payable (Predecessor) | Note 9– Notes Payable (Predecessor) The Predecessor was party to loan agreements used for the purchase of supplies, equipment and a truck. As of December 31, 2018, approximately $20,000 was outstanding and bore an annual interest rate of 3.29%. During the period January 1, 2019 through October 3, 2019 the remaining outstanding balance was repaid in full. During the year ended December 31, 2018 the predecessor repaid $5,854 in principle related to its outstanding Notes. |
Stockholders Equity
Stockholders Equity | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders Equity | Note 10 – Stockholders Equity Successor Preferred Stock The Company is authorized to issue 5.0 million shares of preferred stock, par value $0.001 as of December 31, 2019. No shares of preferred stock were issued or are outstanding as of December 31, 2019. Common Stock The Company has authorized 67.5 million shares of common stock, $0.001 par value per share as of December 31, 2019, of which 60.0 million shares are designated as Class A Common Stock and of which 7.5 million are designated as Class B Common Stock. Both classes of common stock qualify for and share equally in dividends, if declared by the Company’s Board of Directors. In the event of liquidation, dissolution, distribution of assets or winding-up of the Company, the holders of both classes of common stock have equal rights to receive all the assets of the Company, after rights of the holders of the preferred stock, if any, have been satisfied. Class A Common Stock Holders of Class A Common Stock are entitled to one vote per share on matters to be voted upon by stockholders. Holders of Class A Common Stock have no preemptive rights to subscribe for or to purchase any additional shares of Class A Common Stock or other obligations convertible into shares of Class A Common Stock which the Company may issue in the future. All of the outstanding shares of Class A Common Stock are fully paid and non-assessable. Holders of our Class A Common Stock are not liable for further calls or assessments. In October 2019, the Company entered into a separation agreement with the Company’s Chief Executive Officer, (the “Former Executive”), pursuant to which the Former Executive agreed to (a) convert the 40,599 shares of Class B Common Stock of the Company beneficially owned by the Former Executive into 40,599 shares of Class A Common Stock, and (b) cancel all warrants to purchase common stock beneficially held by the Former Executive. In December 2019, the Company entered into separate subscription agreements with certain accredited investors, pursuant to which the Company, in a private placement, issued and sold to the accredited investors an aggregate of 182,335 shares of its Class A Common Stock, at an offering price of $11.00 per share, for gross proceeds to the Company of $2,005,662. As of December 31, 2019, there are 1,683,691 shares of Class A Common Stock outstanding. Class B Common Stock Holders of Class B Common Stock are entitled to fifty votes per share on matters to be voted upon by stockholders. Holders of our Class B Common Stock are entitled to elect, exclusively and as a separate class, three of the Company’s Board of Directors, who may not be removed without cause without the affirmative vote of holders of a majority of the outstanding shares of Class B Common Stock, voting as a separate class. Holders of the Class B Common Stock may, at any time, convert their Class B Common Stock into one share of Class A Common Stock. The Class B conversion ratio is subject to adjustments upon the occurrence of certain events. As described above, in October 2019, the Company entered into a separation agreement with the Former Executive, pursuant to which the Former Executive agreed to convert the 40,599 shares of Class B Common Stock of the Company beneficially owned by the Former Executive into 40,599 shares of Class A Common Stock. As of December 31, 2019, there are 81,198 shares of Class B Common Stock outstanding. Warrants As of December 31, 2019, the Company’s outstanding warrants are as follows: Outstanding as of Exercise Expiration December 31, 2019 Price Date Class W‑1 Warrant 1,125,000 $ 12.50 September 25, 2028 Class W‑2 Warrant 1,125,000 $ 15.00 September 25, 2028 The Class W‑1 and Class W‑2 warrants, (together, the “Warrants”) were issued by the Successor Company and are fully vested and will become exercisable on September 25, 2023, except in the event of a change in control, or termination without cause, as defined in the respective warrant agreements. The Warrants are subject to anti-dilution adjustments in connection with stock splits, tender offers, and certain other events (as described in the respective warrant agreements), and (y) provide for a right for the holders of the Warrants to choose to require that the Warrants be assumed by a successor entity or that the holder of Warrants receive the same consideration as stockholders upon certain change in control events. A summary of warrant activity during the Successor period October 4, 2019 through December 31, 2019 is as follows: Weighted average Weighted remaining exercise contractual life Warrants price (in years) Outstanding as of October 4, 2019 3,150,000 $ 13.75 9.0 Forfeited (900,000) $ 13.75 — Outstanding as of December 31, 2019 2,250,000 $ 13.75 8.7 Exercisable — $ — Predecessor Prior to the Business Combination there were 600 issued and outstanding shares of ANC Green Solutions, Inc. |
Share-based Compensation (Succe
Share-based Compensation (Successor) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Compensation (Successor) | Note 11– Share-based Compensation (Successor) The Andover National Corporation 2019 Equity Incentive Plan (the “Plan”) provides for the issuance of incentive and non-incentive stock options, stock grants and share-based awards. Options and restricted stock units granted generally vest over a period of one to four years and have a maximum term of ten years from the date of grant. As of December 31, 2019, an aggregate of 1,000,000 shares of common stock were authorized under the Plan, subject to an “evergreen” provision that will automatically increase the maximum number of shares of Common Stock that may be issued under the term of the Plan. As of December 31, 2019, 840,000 common shares were available for future grants under the Plan. The fair value of the Company’s restricted stock and restricted stock unit grants were determined by reference to recent or anticipated cash transactions involving the sale of the Company’s common stock. The fair value of the Company’s common stock was estimated to be $11.00 per share at December 31, 2019. The Company recorded total share-based compensation expense of $200,839 for the period October 4, 2019 to December 31, 2019. Restricted Stock As of December 31, 2019, the Company has 10,000 unvested restricted shares with a weighted average grate date fair value of $10 per share. Total unrecognized expense remaining on the restricted shares is $7,650 and is expected to be recognized over the next 0.1 year. Restricted Stock Units Below is a table summarizing the unvested restricted stock units for period from October 4, 2019 through December 31, 2019: Weighted average grant- Units date fair value Unvested as of October 4, 2019 — $ — Granted 150,000 11.00 Unvested as of December 31, 2019 150,000 $ 11.00 Total unrecognized expense remaining $ 1,475,000 Weighted average years expected to be recognized over 1.5 |
Income (Loss) Per Common Share
Income (Loss) Per Common Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Income (Loss) Per Common Share | Note 12 – Income (Loss) Per Common Share The Company calculates basic income (loss) per share by dividing net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during each period. Diluted earnings (loss) per share includes the effect, if any, from the potential exercise or conversion of securities, such as warrants, stock options and restricted stock units, that would result in the issuance of incremental shares of common stock. For the period October 4, 2019 through December 31, 2019 (Successor), the earnings per share amounts are the same for Class A Common and Class B Common stock because the holders of each class are legally entitled to equal per share distributions whether through dividends or in liquidation. The calculations of basic and diluted income (loss) per common share are as follows: Successor October 4, 2019 through December 31, 2019 Numerator: Net loss attributable to common shareholders $ (1,123,755) Denominator: Weighted average Class A common shares outstanding 1,523,675 Weighted average Class B common shares outstanding 88,497 Weighted average Class A and Class B common shares outstanding- Basic 1,612,172 Dilutive effect of potential common shares — Weighted average Class A and Class B common shares outstanding- Diluted 1,612,172 Net loss per share attributable to Class A and Class B Common shareholders- Basic $ (0.70) Net loss per shares attributable to Class A and Class B Common shareholders- Diluted $ (0.70) The following potentially dilutive securities outstanding for the Successor period ended December 31, 2019 have been excluded from the computation of diluted weighted average shares outstanding, as they would be antidilutive. Successor December 31, 2019 Unvested Restricted Stock Units 150,000 Unvested Restricted Stock 10,000 Warrants 2,250,000 2,410,000 There were no potentially dilutive securities outstanding for the Predecessor periods ended October 3, 2019 and December 31, 2018. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 13 – Related Party Transactions Successor The Company occupies a portion of commercial office space that is leased by Peter Cohen, the Company’s Chief Executive Officer, who provides the space to the Company on a month-to-month basis for approximately $6,000 per month. There is no formal lease agreement or security deposit associated with this agreement. The Company paid $18,400 to Mr. Cohen during the period of October 4, 2019 through December 31, 2019 related to this lease agreement. In connection with the Business Combination, the Company entered into a lease agreement with the minority interest holders of ANC Green Solutions I, LLC. The lease agreement is for a period of five years. The Company paid $12,750 during the period of October 4, 2019 through December 31, 2019 related to this lease agreement. In December 2019, the Company entered into subscription agreements with Mr. Cohen and Jeffrey Piermont, the Company’s President and Chief Operating Officer and issued and sold 22,728 and 9,091 shares of its Class A Common Stock, respectively, for total gross proceeds to the Company of $350,009. Predecessor Shareholder contributions for the period of January 1, 2019 through October 3, 2019 and the year ended December 31, 2018 were approximately $0 and $47,000, respectively. Shareholder distributions for the period of January 1, 2019 through October 3, 2019 and the year ended December 31, 2018 were approximately $1,247,000 and $84,000, respectively. During the period January 1, 2019 through October 3, 2019 and the year ended December 31, 2018, the Company was party to a lease agreement with a shareholder of the Company. The Company paid $42,785 and $56,047 to a shareholder during the period of January 1, 2019 through October 3, 2019 and year ended December 31, 2018, respectively, related to this lease agreement. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 14 – Income Taxes Successor The Company has accumulated net losses and has not recorded an income tax provision or benefit for the United States (U.S.) federal and state income taxes during period from October 4, 2019 through December 31, 2019. A reconciliation of income taxes at the statutory federal income tax rate to net income taxes included in the consolidated statements of operations is as follows: October 4, 2019 through December 31, 2019 U.S. federal income tax expense at the statutory rate 21.0 % State income taxes, net of federal taxes 3.5 Non-controlling interest 1.4 Other permanent items (0.5) Change in valuation allowance (25.4) Income tax provision (benefit) — % Net deferred tax assets consist of the following components: December 31, 2019 Deferred tax assets Net operating loss carryforwards $ 663,177 Stock-based compensation 65,597 Total deferred tax assets 728,774 Less valuation allowance (728,744) Net deferred tax assets $ — As of each reporting date, the Company considers existing evidence, both positive and negative, that could impact its view with regard to future realization of deferred tax assets. The Company believes that it is more likely than not that the benefit for deferred tax assets will not be realized. In recognition of this uncertainty, a full valuation allowance was applied to the deferred tax assets. The Company did not record a tax provision for the period October 4, 2019 through December 31, 2019, due to the Company's estimate that the effective tax rate for each year is 0%. Future realization depends on the Company's future earnings, if any, the timing and amount of which are uncertain as of December 31, 2019. In the future, should management conclude that it is more likely than not that the deferred tax assets are partially or fully realizable, the valuation allowance would be reduced to the extent of such expected realization and the amount would be recognized as a deferred income tax benefit in the Company's consolidated statements of operations. At December 31, 2019 the Company had net operating loss carryforwards of approximately $2.8 million. Federal net operating losses of approximately $2.6 million carryforward indefinitely. State operating loss carryforwards of approximately $2.1 million carry forward indefinitely. Pursuant to Section 382 of the Internal Revenue Code of 1986, as amended, a portion of the Company’s federal and state net operating loss carryforwards may be limited due to ownership changes that occurred previously or that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. Due to the existence of the valuation allowance, limitations created by the ownership changes will not impact the Company’s effective tax rate. All tax years remain subject to examination by major taxing jurisdictions. There have been no material income tax related interest or penalties assessed or recorded during the period October 4, 2019 through December 31, 2019. No liability related to uncertain tax positions is reported in the Company's consolidated financial statements. Predecessor Prior to the Business Combination, the Company was a Subchapter S pass-through entity for income tax purposes. Accordingly, the Company not subject to income taxes prior to the acquisition and therefore there is no tax provision related to the income. |
Subsequent Events (Successor)
Subsequent Events (Successor) | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events (Successor) | Note 15 – Subsequent Events (Successor) On February 28, 2020, the Company, through an indirect wholly owned subsidiary, entered into an Asset and Equity Purchase and Contribution Agreement (the “Smith Purchase Agreement”) with Smith’s Tree Care, Inc., a Virginia corporation (“Smith Seller”), Utro Crane Company, LLC, a Delaware limited liability company and indirect subsidiary of the Company, Utro Crane Company, Inc., a Virginia corporation, and ANC Green Solutions - Smith’s, LLC, a Delaware limited liability company and indirect subsidiary of the Company (“ANC Smith’s”), pursuant to which, among other things, (i) the Company purchased an undivided sixty percent (60%) interest in all of Smith Seller’s right, title and interest in and to all of Smith Seller’s property and assets (the “Acquired Assets”), in consideration for an aggregate purchase price payable by the Company of approximately $3.0 million, subject to certain adjustments, as set forth in the Smith Purchase Agreement and (ii) Smith Seller conveyed, transferred, assigned and delivered to ANC Smith’s an undivided forty percent (40%) interest in the Acquired Assets in exchange for equity securities of ANC Smith’s. The acquisition will be accounted for as a business combination using the acquisition method of accounting for all identifiable assets acquired and liabilities assumed at fair value as of the date control is obtained. The accounting for this acquisition is not yet complete. On February 3, 2020, the Company, through an indirect wholly owned subsidiary, entered into an Asset Purchase and Contribution Agreement (the “Potter Purchase Agreement”) with Potter’s Professional Lawn Care, Inc., a Florida corporation (“Potter Seller”), and the shareholders of Potter Seller party thereto, pursuant to which the Company purchased from Potter Seller a sixty percent (60%) interest in all of Potter Seller’s right, title and interest in and to all of Potter Seller’s property and assets, for $1,680,000 in cash, subject to certain adjustments. The acquisition will be accounted for as a business combination using the acquisition method of accounting for all identifiable assets acquired and liabilities assumed at fair value as of the date control is obtained. The accounting for this acquisition is not yet complete. On January 30, 2020, the Company entered into subscription agreements with certain investors (including Mr. Cohen, and Milun Patel, the Company’s Chief Financial Officer) and issued and sold an aggregate of 39,628 shares of its Class A Common Stock to such investors for total gross proceeds to the Company of $435,908. On January 31, 2020, the Company entered into a subscription agreement with an additional investor and issued and sold an aggregate of 90,910 shares of Class A Common Stock to such additional investor for total gross proceeds to the Company of $1,000,010. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation These consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company and its consolidated subsidiaries which are directly or indirectly owned by the Company. As a result of the Business Combination, the Company is the acquirer for accounting purposes and ANC Green Solutions is the acquiree and accounting predecessor. The Company’s financial statement presentation distinguishes the Company’s financial performance into two distinct periods, the period up to the closing date of the Business Combination (labeled “Predecessor”) and the period including and after that date (labeled “Successor”). The Business Combination was accounted for as a business combination using the acquisition method of accounting, and the Successor financial statements reflect a new basis of accounting that is based on the fair value of the net assets acquired. Determining the fair value of the assets acquired and liabilities assumed is judgmental in nature and often involves the use of significant estimates and assumptions. See Note 4 – Business Combinations for a discussion of the estimated fair values of assets and liabilities recorded in connection with the Company’s acquisition of ANC Green Solutions. As a result of the application of the acquisition method of accounting as of the closing date of the Business Combination, the accompanying Consolidated Financial Statements include a black line division which indicates that the Predecessor and Successor reporting entities shown are presented on a different basis and are therefore, not comparable. The historical financial information of Andover prior to the Business Combination has not been reflected in the Predecessor financial statements as these historical amounts have been determined to be not useful information to a reader of the financial statements. The operations of Andover, until the closing of a business combination, other than income from investments and general and administrative expenses, were nominal. Accordingly, no other activity in the Company was reported for periods prior to October 4, 2019 besides ANC Green Solutions’ operations as Predecessor. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Management makes estimates that affect certain accounts including deferred income tax assets, accrued expenses, fair value of equity instruments and reserves for any other commitments or contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined. |
Principles of Consolidation | Principles of Consolidation The Company’s policy is to consolidate all entities in which it has a controlling financial interest. For consolidated entities that are less than wholly owned, the third party’s holding of equity interest is presented as noncontrolling interests in the Company’s consolidated balance sheets and consolidated statement of equity. The portion of net income (loss) attributable to the noncontrolling interests is presented as net income (loss) attributable to noncontrolling interests in the Company’s consolidated statement of operations. The accompanying Successor consolidated financial statements include the accounts of Andover National Corporation and its consolidated subsidiary, ANC Green Solutions. The accompanying Predecessor consolidated financial statements include the accounts of ANC Green Solutions and its consolidated subsidiaries, Legg Lawncare, Inc. and Legg SMS Franchising, Inc. All material inter-company balances and transactions have been eliminated. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and highly liquid investments with maturities of three months or less from the date of purchase to be cash and cash equivalents. As of December 31, 2019, the Company’s cash equivalents included U.S. Treasury Bills with maturities of 90 days or less. Realized and unrealized gains and losses on highly liquid investments classified as cash equivalents are reported in investment income in the consolidated statement of operations. The Company had no cash equivalents as of December 31, 2018. |
Concentration of credit risk | Concentration of credit risk The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible. Concentrations of credit risk with respect to trade accounts receivable are limited due to the number of customers comprising the customer base. During the period from October 4, 2019 through December 31, 2019 (Successor), the period January 1, 2019 through October 3, 2019 (Predecessor) and year ended December 31, 2018 (Predecessor), no customer accounted for more than 10% of the Company’s total revenue. |
Accounts receivable | Accounts Receivable Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company reserves for all accounts that are deemed to be uncollectible and reviews its allowance for doubtful accounts regularly. The allowance is based on the age of receivables and a specific identification of receivables considered at risk. Account balances are written off against the allowance when the potential for recovery is considered remote. The following table provides a roll forward of the allowance for doubtful accounts: Successor Predecessor October 4, 2019 January 1, 2019 through through Year Ended December 31, 2019 October 3, 2019 December 31, 2018 Allowance for doubtful accounts, beginning of period $ — $ 34,976 $ 23,051 Bad debt expense 2,467 — 11,925 Allowance for doubtful accounts, end of period $ 2,467 $ 34,976 $ 34,976 |
Prepaid expenses and other current assets | Prepaid expenses and other current assets Prepaid expenses consist of payments that the Company has made in advance for goods or services to be received in the future. Prepaid expenses primarily consist of payments associated with insurance contracts. |
Property and Equipment | Property and Equipment Property and equipment, stated at cost, are depreciated using the straight-line method over the estimated useful life of the asset, or for leasehold improvements, over the shorter of the estimated useful life or the lease term. As of December 31, 2019 and 2018, the estimated useful lives (in years) of each of the Company’s classes of property and equipment were as follows: Useful Lives (in years) Vehicles 5‑10 Equipment 5‑7 Leasehold improvements 5 Office equipment 5‑7 Equipment replacement, maintenance and repair costs, which do not extend the lives of the assets, are charged to operating expense as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, which include property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company considers the following to be some examples of important indicators that may trigger an impairment review: (i) historical, current and/ or projected operating or cash flow losses associated with the use of the asset; (ii) significant changes in the extent or manner in which the assets are used; (iii) significant changes in the business climate in which the assets are used, such as negative industry or economic trends, or increased competitive pressures; (iv) a significant decline in the market price of the asset; and (v) legal or regulatory changes. The Company evaluates assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events. The Company does not test for impairment in the year of acquisition of premises and equipment, so long as those premises and equipment are acquired from unrelated third parties. The Company assesses the recoverability of its long-lived assets by comparing the projected undiscounted net cash flows associated with the related long-lived asset or group of long-lived assets over their remaining estimated useful lives against their respective carrying amounts. In cases where estimated future net undiscounted cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of the asset or asset group. Fair value is generally determined using the assets expected future discounted cash flows or market value, if readily determinable. If long- lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated and amortized prospectively over the newly determined remaining estimated useful lives. |
Leases | Leases Effective January 1, 2019, the Company accounts for its leases under Accounting Standard Codification (“ASC”) Topic 842, Leases . The Company determines if an arrangement is a lease at inception. Operating leases are included in right-of-use (“ROU”) assets and lease liabilities on the consolidated balance sheets. Lease ROU assets and operating lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using the Company’s incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. ROU assets also include any lease payments made at or before lease commencement and exclude any lease incentives received. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company accounts for lease and non-lease components as a single lease component for all its leases. The Company does not recognize ROU assets and lease liabilities that arise from leases with an original term of 12 months or less. Rather, the Company recognizes the lease payments associated with these leases on a straight-line basis over the term of the lease. Prior to January 1, 2019, the Company accounted for leases under ASC 840. The Company recorded rent expense associated with its operating leases on a straight-line basis over the term of the lease. |
Goodwill and Intangible Assets (Successor) | Goodwill and Intangible Assets (Successor) Goodwill. Goodwill represents the excess acquisition cost over the fair value of the net tangible and intangible assets acquired. Goodwill is not amortized and is subject to annual impairment testing on or between annual tests if an event or change in circumstance occurs that would more likely than not reduce the fair value of a reporting unit below its carrying value. In testing for goodwill impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is not required. If the Company concludes otherwise, the Company is required to perform the two-step impairment test. The goodwill impairment test is performed at the reporting unit level by comparing the estimated fair value of a reporting unit with its respective carrying value. If the estimated fair value exceeds the carrying value, goodwill at the reporting unit level is not impaired. If the estimated fair value is less than the carrying value, further analysis is necessary to determine the amount of impairment, if any, by comparing the implied fair value of the reporting unit’s goodwill to the carrying value of the reporting unit’s goodwill. Intangible Assets. Intangible assets deemed to have finite lives are amortized on a straight-line basis over their estimated useful lives, where the useful life is the period over which the asset is expected to contribute directly, or indirectly, to the Company’s future cash flows. Intangible assets are reviewed for impairment on an interim basis when certain events or circumstances exist. For amortizable intangible assets, impairment exists when the carrying amount of the intangible asset exceeds its fair value. At least annually, the remaining useful life is evaluated. |
Business Combinations (Successor) | Business Combinations (Successor) The Company applies the provisions of Accounting Standard Codification (“ASC”) Topic 805, Business Combinations , in the accounting for acquisitions. ASC 805 requires the Company to recognize separately from goodwill the assets acquired and the liabilities assumed at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While the Company uses its best estimates and assumptions to accurately apply preliminary value to assets acquired and liabilities assumed at the acquisition date, where applicable, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments in the current period, rather than a revision to a prior period. Upon the conclusion of the measurement period or final determination of the values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the consolidated statements of operations. Accounting for business combinations requires management to make significant estimates and assumptions, especially at the acquisition date, including estimates for intangible assets, contractual obligations assumed, restructuring liabilities, preacquisition contingencies, and contingent consideration, where applicable. Although the Company believes the assumptions and estimates made have been reasonable and appropriate, they are based in part on historical experience and information obtained from management of the acquired companies and are inherently uncertain. Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates, or actual results. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue from contracts with customers in accordance with ASC Topic 606, Revenue from Contracts with Customers (the “revenue standard”). The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. A good or service is transferred to a customer when, or as, the customer obtains control of that good or service. The following five steps are applied to achieve that core principle: · Step 1: Identify the contract with the customer · Step 2: Identify the performance obligations in the contract · Step 3: Determine the transaction price · Step 4: Allocate the transaction price to the performance obligation in the contract · Step 5: Recognize revenue when the company satisfies a performance condition The Company’s revenue is primarily generated from residential and commercial lawn care programs and services. The Company generally recognizes revenue from the sale of services as the services are performed, which is typically ratably over the term of the contract(s), which the Company believes to be the best measure of progress. The Company recognizes revenues as it completes services to its customers in an amount reflecting the total consideration it expects to receive from the customer. The Company determined that for contracts containing multiple performance obligations, stand-alone selling price is readily determinable for each performance obligation. The transaction price will include estimates of variable consideration, such as returns and provisions for doubtful accounts and sales incentives, to the extent it is probable that a significant reversal of revenue recognized will not occur. In all cases, when a sale is recorded by the Company, no significant uncertainty exists surrounding the purchaser’s obligation to pay. The Company also grants franchises to operators in exchange for an initial franchise license fee and continuing royalty payments. Franchise revenue is recognized over the license term as the Company has determined that all obligations under the franchise agreements represent a single performance obligation that is satisfied over time. |
Cost of services provided | Cost of services provided Cost of services provided represents costs directly related to the provision of the lawncare programs and services, and include direct labor, materials and equipment depreciation. The Company recognizes the costs of services provided as the associated revenues are recognized. |
Share-based compensation (Successor) | Share-based compensation (Successor) The Company accounts for its share-based compensation arrangements in accordance with ASC Topic 718, Compensation – Stock Compensation, which requires the measurement of compensation expense for all share-based compensation granted to employees and non-employees at fair value on the date of grant and recognition of compensation expense over the related service period. Forfeitures are accounted for as they occur. Share-based awards with graded-vesting schedules are recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award. |
Net Income (Loss) Per Common Share (Successor) | Net Income (Loss) Per Common Share (Successor) Basic net income (loss) per share is calculated by dividing the net income (loss) applicable to the common stockholders by the weighted average number of shares of common stock outstanding during the reporting periods. Diluted net income (loss) per share includes the effect, if any, from the potential exercise or conversion of securities, such as warrants and restricted stock units that would result in the issuance of incremental shares of common stock. In computing the basic and diluted net loss per share applicable to common stockholders during the period October 4, 2019 through December 31, 2019, the weighted average number of shares remains the same for both calculations due to the fact that when a net loss exists, dilutive shares are not included in the calculation as the impact is anti-dilutive. |
Related Party Transactions | Related Party Transactions The Company accounts for related party transactions in accordance with ASC 850, Related Party Disclosures. A party is considered to be related to the Company if the party directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. |
Fair Value Measurements | Fair Value Measurements Fair value measurements are based on the premise that fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the following three-tier fair value hierarchy has been used in determining the inputs used in measuring fair value: Level 1‑ Quoted prices in active markets for identical assets or liabilities on the reporting date. Level 2‑ Pricing inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3‑ Pricing inputs are generally unobservable and include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require management’s judgment or estimation of assumptions that market participants would use in pricing the assets or liabilities. The fair values are therefore determined using factors that involve considerable judgment and interpretations, including but not limited to private and public comparables, third-party appraisals, discounted cash flow models and fund manager estimates. Financial instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Management’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The use of different assumptions and/or estimation methodologies may have a material effect on estimated fair values. Accordingly, the fair value estimates disclosed or initial amounts recorded may not be indicative of the amount that the Company or holders of the instruments could realize in a current market exchange. As of December 31, 2019 and 2018, the recorded values of cash and cash equivalents, accounts receivable, accounts payable and notes payable, approximate the fair values due to the short-term nature of the instruments. |
Income Taxes | Income Taxes Successor Income taxes are accounted for under the asset and liability method. Deferred income taxes are recorded for temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities reflect the tax rates expected to be in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more-likely than not that some or all of the deferred tax assets will not be realized. The Company also follows the provisions of accounting for uncertainty in income taxes which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition. In accordance with this guidance, tax positions must meet a more-likely than not recognition threshold and measurement attribute for the financial statement recognition and measurement of tax position. The Company’s policy is to account for income tax related interest and penalties in the provision for income taxes in the accompanying consolidated statements of operations. Predecessor The Predecessor’s subsidiaries were Subchapter S pass-through entities for income tax purposes. Accordingly, the Predecessor was not viewed as a taxpaying entity in any jurisdiction and did not require a provision for income taxes. |
Segment Information | Segment Information The Company operates under one segment which provides residential and commercial lawncare services. |
Retirement Plans | Retirement Plans The Company maintains defined benefit contribution retirement plans for eligible employees under Section 401(k) of the Internal Revenue Code. Participants can make voluntary contributions up the Internal Revenue Service limit of $19,000 ($25,000 for employees 50 years or over) for 2019. The Company contributed $5,593, $5,050 and $4,006 during the period October 4, 2019 through December 31, 2019 (Successor), the period January 1, 2019 through October 3, 2019 (Predecessor) and the year ended December 31, 2018 (Predecessor), respectively. |
Recently Adopted Accounting Pronouncements | Recent Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016‑2, Leases (“ASC 842”). The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, using a modified retrospective approach. The Company adopted ASC 842 on January 1, 2019 using the optional transition method to apply the new guidance as of the date of adoption, rather than as of the earliest period presented. The adoption of ASC 842 on January 1, 2019 did not have an impact on the Company’s consolidated financial statements as the Company did not have any leases with original terms longer than 12 months at the date of adoption. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is effective for fiscal periods beginning after December 15, 2018, including interim periods within those periods. The standard became effective for the Company in the first quarter of 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU 2018‑07, Compensation- Stock Compensation (Topic 718) Improvements to Nonemployee Share-Based Payment Accounting , which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The guidance also specifies that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The Company early adopted this standard as of January 1, 2019. The Company did not grant share-based payment awards during the Predecessor period. Accordingly, the adoption of this standard did not have a material effect on the Company’s consolidated financial statements and related disclosures. |
Recent Issued Accounting Pronouncements | Recent Issued Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019‑12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019‑12”), which is intended to simplify various aspects related to accounting for income taxes. ASU 2019‑12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of roll forward of the allowance for doubtful accounts | Successor Predecessor October 4, 2019 January 1, 2019 through through Year Ended December 31, 2019 October 3, 2019 December 31, 2018 Allowance for doubtful accounts, beginning of period $ — $ 34,976 $ 23,051 Bad debt expense 2,467 — 11,925 Allowance for doubtful accounts, end of period $ 2,467 $ 34,976 $ 34,976 |
Schedule of estimated useful lives of property plant and equipment | Useful Lives (in years) Vehicles 5‑10 Equipment 5‑7 Leasehold improvements 5 Office equipment 5‑7 |
Business Combination (Success_2
Business Combination (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Preliminary allocation of purchase price to assets acquired and liabilities assumed for acquisition | The following table presents the preliminary allocation of the purchase price to the assets acquired and liabilities assumed for the acquisition of ANC Green Solutions (in thousands): Accounts receivable $ 176 Prepaid expenses 10 Property and equipment 206 Intangible assets 1,963 Goodwill 4,310 Accounts payable and accrued expenses (66) Deferred cash consideration (500) Non-controlling interest in ANC Solutions (2,667) Cash purchase price, net of cash acquired $ 3,432 |
Schedule of Unaudited Pro Forma Financial Information | Year ended December 31, 2019 December 31, 2018 Total revenue $ 2,640,290 $ 2,235,237 Net loss (2,003,167) (430,624) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Successor Predecessor December 31, 2019 December 31, 2018 Vehicles $ 101,410 $ 377,932 Equipment 119,276 292,272 Leasehold improvements 42,163 9,990 Office equipment 2,196 4,664 Total property and equipment 265,045 684,858 Less: Accumulated depreciation (19,092) (423,480) Property and equipment, net $ 245,953 $ 261,378 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | December 31, 2019 Gross Accumulated Amortization Net Tradenames $ 251,000 $ (10,458) $ 240,542 Customer relationships 1,712,000 (71,334) 1,640,666 $ 1,963,000 $ (81,792) $ 1,881,208 Weighted average amortization period (in years) Tradenames 6 Customer relationships 6 |
Schedule of estimated aggregate amortization expense | 2020 327,167 2021 327,167 2022 327,167 2023 327,167 2024 327,167 Thereafter 245,373 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Summary of lease expenses | Lease expenses during the period October 4, 2019 through December 31, 2019 are as follows: Successor October 4, 2019 through December 31, 2019 Operating leases Operating lease cost $ 12,750 Operating lease expense 12,750 Short-term lease rent expense 18,418 Total rent expense $ 31,168 |
Schedule of maturity of operating leases | The Company’s maturity of its operating leases are as follows: 2020 $ 51,000 2021 51,000 2022 51,000 2023 51,000 2024 38,250 Thereafter — Total 242,250 Less: Interest (21,956) Present value of lease liabilities $ 220,294 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts payable and Accrued liabilities | Successor Predecessor December 31, 2019 December 31, 2018 Accounts payable $ 138,712 $ — Accrued professional fees 235,124 30,212 Accrued franchise tax 200,000 — Accrued payroll 13,748 19,797 Accounts payable and accrued liabilities $ 587,584 $ 50,009 |
Stockholders Equity (Tables)
Stockholders Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of outstanding warrants | Outstanding as of Exercise Expiration December 31, 2019 Price Date Class W‑1 Warrant 1,125,000 $ 12.50 September 25, 2028 Class W‑2 Warrant 1,125,000 $ 15.00 September 25, 2028 |
Summary of warrant activity | Weighted average Weighted remaining exercise contractual life Warrants price (in years) Outstanding as of October 4, 2019 3,150,000 $ 13.75 9.0 Forfeited (900,000) $ 13.75 — Outstanding as of December 31, 2019 2,250,000 $ 13.75 8.7 Exercisable — $ — |
Share-based Compensation (Suc_2
Share-based Compensation (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of unvested restricted stock units | Weighted average grant- Units date fair value Unvested as of October 4, 2019 — $ — Granted 150,000 11.00 Unvested as of December 31, 2019 150,000 $ 11.00 Total unrecognized expense remaining $ 1,475,000 Weighted average years expected to be recognized over 1.5 |
Income (Loss) Per Common Share
Income (Loss) Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Summary calculations of basic and diluted income (loss) per common share | Successor October 4, 2019 through December 31, 2019 Numerator: Net loss attributable to common shareholders $ (1,123,755) Denominator: Weighted average Class A common shares outstanding 1,523,675 Weighted average Class B common shares outstanding 88,497 Weighted average Class A and Class B common shares outstanding- Basic 1,612,172 Dilutive effect of potential common shares — Weighted average Class A and Class B common shares outstanding- Diluted 1,612,172 Net loss per share attributable to Class A and Class B Common shareholders- Basic $ (0.70) Net loss per shares attributable to Class A and Class B Common shareholders- Diluted $ (0.70) |
Summary of potentially dilutive securities excluded from computation of diluted weighted average shares outstanding | Successor December 31, 2019 Unvested Restricted Stock Units 150,000 Unvested Restricted Stock 10,000 Warrants 2,250,000 2,410,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Net deferred tax assets | December 31, 2019 Deferred tax assets Net operating loss carryforwards $ 663,177 Stock-based compensation 65,597 Total deferred tax assets 728,774 Less valuation allowance (728,744) Net deferred tax assets $ — |
Provision for (benefit from) income taxes | October 4, 2019 through December 31, 2019 U.S. federal income tax expense at the statutory rate 21.0 % State income taxes, net of federal taxes 3.5 Non-controlling interest 1.4 Other permanent items (0.5) Change in valuation allowance (25.4) Income tax provision (benefit) — % |
Nature of the Business (Details
Nature of the Business (Details) - ANC Green Solutions [Member] | Oct. 04, 2019USD ($) |
Business Acquisition [Line Items] | |
Percentage voting interest acquired | 60.00% |
Consideration transferred | $ 4,000,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Accounts Receivable (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Accounting Policies [Abstract] | ||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor | |
Allowance for doubtful accounts, beginning of period | $ 34,976 | $ 0 | $ 34,976 | $ 23,051 |
Bad debt expense | 2,467 | 11,925 | ||
Allowance for doubtful accounts, end of period | $ 2,467 | $ 2,467 | $ 34,976 | $ 34,976 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Minimum | Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Minimum | Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Minimum | Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Maximum | Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | |
Maximum | Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Maximum | Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Additional (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2019USD ($) | Oct. 03, 2019USD ($) | Dec. 31, 2019segment | Dec. 31, 2018USD ($) | |
Segment Information | ||||
Number of reportable segments | segment | 1 | |||
Retirement Plans | ||||
Employer contribution | $ | $ 5,593 | $ 5,050 | $ 4,006 |
Revenue (Details)
Revenue (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Total revenue | $ 683,265 | $ 1,957,025 | $ 2,235,237 |
Lawncare service revenue | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 665,323 | 1,880,694 | 2,142,043 |
Franchise revenue | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 17,942 | $ 76,331 | $ 93,194 |
Business Combination (Success_3
Business Combination (Successor) - Purchase Price (Details) - USD ($) | Oct. 04, 2019 | Dec. 31, 2019 | Dec. 31, 2019 |
Preliminary allocation of purchase price | |||
Goodwill | $ 4,309,766 | $ 4,309,766 | |
ANC Green Solutions [Member] | |||
Business Acquisition [Line Items] | |||
Percentage voting interest acquired | 60.00% | ||
Cash consideration | $ 3,500,000 | ||
Purchase consideration | 4,000,000 | ||
Deferred consideration | 500,000 | ||
Preliminary allocation of purchase price | |||
Accounts receivable | 176,000 | ||
Prepaid expenses | 10,000 | ||
Property and equipment | 206,000 | ||
Intangible assets | 1,963,000 | ||
Goodwill | 4,310,000 | ||
Accounts payable and accrued expenses | (66,000) | ||
Deferred cash consideration | (500,000) | ||
Non-controlling interest in ANC Solutions | (2,667,000) | ||
Cash purchase price, net of cash acquired | $ 3,432,000 | ||
Transaction cost related to acquisition | $ 65,000 | $ 119,000 |
Business Combination (Success_4
Business Combination (Successor) - Unaudited Proforma (Details) - ANC Green Solutions [Member] - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | |||
Total revenue | $ 2,640,290 | $ 2,235,237 | |
Net loss | (2,003,167) | (430,624) | |
Amortization of intangible assets | 245,000 | $ 327,000 | |
Transaction cost related to acquisition | $ 65,000 | $ 119,000 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Total property and equipment | $ 265,045 | $ 684,858 | |
Less : Accumulated depreciation | (19,092) | (423,480) | |
Property and equipment, net | 245,953 | 261,378 | |
Depreciation expense | 19,092 | $ 62,107 | 85,453 |
Vehicles | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 101,410 | 377,932 | |
Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 119,276 | 292,272 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 42,163 | 9,990 | |
Office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 2,196 | $ 4,664 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Successor) (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Acquired Indefinite-lived Intangible Assets [Line Items] | |
Gross | $ 1,963,000 |
Accumulated Amortization | (81,792) |
Net | 1,881,208 |
Goodwill | 4,309,766 |
Tradenames | |
Acquired Indefinite-lived Intangible Assets [Line Items] | |
Gross | 251,000 |
Accumulated Amortization | (10,458) |
Net | $ 240,542 |
Weighted average amortization period | 6 years |
Customer relationships | |
Acquired Indefinite-lived Intangible Assets [Line Items] | |
Gross | $ 1,712,000 |
Accumulated Amortization | (71,334) |
Net | $ 1,640,666 |
Weighted average amortization period | 6 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Successor) (Details 1) | Dec. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 327,167 |
2021 | 327,167 |
2022 | 327,167 |
2023 | 327,167 |
2024 | 327,167 |
Thereafter | $ 245,373 |
Leases - Lease Expenses (Detail
Leases - Lease Expenses (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Leases [Abstract] | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Right of use assets | $ 220,294 | ||
Operating lease liabilities | 220,294 | ||
Lease Expenses | |||
Operating lease expense | 12,750 | $ 42,785 | |
Short-term lease rent expense | 18,418 | ||
Total rent expense | $ 31,168 | ||
Weighted average remaining lease term | 4 years 9 months | ||
Weighted average discount rate | 4.00% |
Leases - Lease Maturity (Detail
Leases - Lease Maturity (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Maturity of operating leases | |||
2020 | $ 51,000 | ||
2021 | 51,000 | ||
2022 | 51,000 | ||
2023 | 51,000 | ||
2024 | 38,250 | ||
Total | 242,250 | ||
Less: Interest | (21,956) | ||
Present value of lease liabilities | 220,294 | ||
Rent expense | $ 12,750 | $ 42,785 | |
Rent expense | $ 56,047 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Accounts payable | $ 138,712 | ||
Accrued professional fees | 235,124 | $ 30,212 | |
Accrued franchise tax | 200,000 | ||
Accrued payroll | 13,748 | 19,797 | |
Total | $ 587,584 | $ 50,009 |
Notes Payable (Predecessor) (De
Notes Payable (Predecessor) (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Oct. 03, 2019 | Dec. 31, 2018 | |
Debt Disclosure [Abstract] | ||
Outstanding notes payable | $ 20,000 | |
Annual interest rate | 3.29% | |
Repayment of principal | $ 20,473 | $ 5,854 |
Stockholders Equity - Warrants
Stockholders Equity - Warrants (Details) - $ / shares | Dec. 31, 2019 | Oct. 04, 2019 |
Warrants | ||
Warrant outstanding | 2,250,000 | 3,150,000 |
Exercise Price | $ 13.75 | $ 13.75 |
Class W1 Warrant | ||
Warrants | ||
Warrant outstanding | 1,125,000 | |
Exercise Price | $ 12.50 | |
Expiration Date | Sep. 25, 2028 | |
Class W2 Warrant | ||
Warrants | ||
Warrant outstanding | 1,125,000 | |
Exercise Price | $ 15 | |
Expiration Date | Sep. 25, 2028 |
Stockholders Equity - Schedule
Stockholders Equity - Schedule of warrants (Details) - $ / shares | Oct. 04, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 |
Stockholders' Equity Note [Abstract] | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor | ||
Beginning balance | 3,150,000 | ||||
Forfeited | (900,000) | ||||
Ending balance | 3,150,000 | 2,250,000 | 2,250,000 | ||
Weighted exercise price, beginning balance | $ 13.75 | ||||
Weighted exercise price, Forfeited | 13.75 | ||||
Weighted exercise price, Ending balance | $ 13.75 | $ 13.75 | $ 13.75 | ||
Weighted average remaining contractual life of warrants | 9 years | 8 years 8 months 12 days |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Class of Stock [Line Items] | ||||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Preferred stock, shares outstanding | 0 | 0 | 0 | |||
Common stock, shares authorized | 600 | |||||
Common stock, par value | $ 1 | |||||
Common Stock, shares issued | 600 | |||||
Common Stock, shares outstanding | 600 | |||||
Preferred Stock | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Preferred stock, shares issued | 0 | 0 | 0 | |||
Preferred stock, shares outstanding | 0 | 0 | 0 | |||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized | 67,500,000 | 67,500,000 | 67,500,000 | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Class A Common stock | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized | 60,000,000 | 60,000,000 | 60,000,000 | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Number of votes | 1 | |||||
Common Stock, shares issued | 1,683,691 | 1,683,691 | 1,683,691 | |||
Common Stock, shares outstanding | 1,683,691 | 1,683,691 | 1,683,691 | |||
Class B Common stock | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized | 7,500,000 | 7,500,000 | 7,500,000 | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Number of votes | 50 | |||||
Common Stock, shares issued | 81,198 | 81,198 | 81,198 | |||
Common Stock, shares outstanding | 81,198 | 81,198 | 81,198 | |||
Private Placement | Class A Common stock | ||||||
Class of Stock [Line Items] | ||||||
Shares issued | 182,335 | |||||
Share price | $ 11 | $ 11 | $ 11 | |||
Gross proceeds | $ 2,005,662 | |||||
Peter Cohen | Class A Common stock | ||||||
Class of Stock [Line Items] | ||||||
Shares issued on conversion | 40,599 | 40,599 | ||||
Peter Cohen | Class B Common stock | ||||||
Class of Stock [Line Items] | ||||||
Shares converted | 40,599 | 40,599 |
Share-based Compensation (Suc_3
Share-based Compensation (Successor) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Unit | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
2019 Equity Incentive Plans | |||
Weighted average grant-date fair value | |||
Weighted average grant-date fair value, Beginning balance | $ 11 | ||
2019 Equity Incentive Plans | Unvested Restricted Stock Units | |||
Unit | |||
Granted | 150,000 | ||
Ending balance | 150,000 | ||
Total unrecognized expense remaining | $ 1,475,000 | ||
Weighted average years expected to be recognized over | 1 year 6 months | ||
Weighted average grant-date fair value | |||
Weighted average grant-date fair value, Granted | $ 11 | ||
Weighted average grant-date fair value, Beginning balance | $ 11 |
Share-based Compensation (Suc_4
Share-based Compensation (Successor) (Details Textual) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based compensation expense | $ | $ 200,839 | |
2019 Equity Incentive Plans | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate shares of common stock were authorized | 1,000,000 | 1,000,000 |
Common shares were available for future grants | 840,000 | 840,000 |
Weighted average grant-date fair value | $ / shares | $ 11 | $ 11 |
2019 Equity Incentive Plans | Options | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting Period | 1 year | |
2019 Equity Incentive Plans | Options | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting Period | 4 years | |
2019 Equity Incentive Plans | Unvested Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unvested restricted shares | 10,000 | 10,000 |
Weighted average grant-date fair value | $ / shares | $ 10 | $ 10 |
Total unrecognized expense remaining | $ | $ 7,650 | $ 7,650 |
Weighted average years expected to be recognized over | 1 month 6 days | |
2019 Equity Incentive Plans | Unvested Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unvested restricted shares | 150,000 | 150,000 |
Weighted average grant-date fair value | $ / shares | $ 11 | $ 11 |
Total unrecognized expense remaining | $ | $ 1,475,000 | $ 1,475,000 |
Weighted average years expected to be recognized over | 1 year 6 months | |
2019 Equity Incentive Plans | Unvested Restricted Stock Units | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting Period | 10 years |
Income (Loss) Per Common Shar_2
Income (Loss) Per Common Share - Basic and Diluted (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor |
Net income (loss) attributable to common shareholders | $ (1,123,755) | $ 449,463 | $ 432,755 |
Weighted average common shares outstanding- Basic | 1,612,172 | ||
Weighted average common shares outstanding- Diluted | 1,612,172 | ||
Net loss per share attributable to Class A and Class B Common shareholders- Basic | $ (0.70) | ||
Net loss per shares attributable to Class A and Class B Common shareholders- Diluted | $ (0.70) | ||
Class A Common stock | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Weighted average common shares outstanding- Basic | 1,523,675 | ||
Class B Common stock | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Weighted average common shares outstanding- Basic | 88,497 |
Income (Loss) Per Common Shar_3
Income (Loss) Per Common Share - Anti Dilutive (Details) - shares | Oct. 03, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor | ||
Potential equivalent shares excluded | 0 | 2,410,000 | 0 | 0 | |
Unvested Restricted Stock Units | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Potential equivalent shares excluded | 150,000 | ||||
Unvested Restricted Stock | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Potential equivalent shares excluded | 10,000 | ||||
Warrants | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Potential equivalent shares excluded | 2,250,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2018 | |
Lease expense | $ 31,168 | ||||
Rent expense | $ 56,047 | ||||
Proceeds from the issuance of shares in private placement | $ 2,005,662 | ||||
Shareholders contribution | $ 0 | 46,774 | |||
Shareholders distribution | 1,247,448 | 83,757 | |||
Class A Common stock | |||||
Proceeds from the issuance of shares in private placement | $ 350,009 | ||||
Peter Cohen | Lease Transactions | |||||
Lease cost per month | 6,000 | ||||
Lease expense | $ 18,400 | ||||
Peter Cohen | Class A Common stock | |||||
Shares issued | 22,728 | ||||
Jeffrey Piermont | Class A Common stock | |||||
Shares issued | 9,091 | ||||
Noncontrolling Interest [Member] | Class A Common stock | ANC Green Solutions [Member] | |||||
Lease term | 5 years | 5 years | 5 years | ||
Lease expense | $ 12,750 | ||||
Shareholder | |||||
Shareholders distribution | 1,247,000 | 84,000 | |||
Shareholder | Lease Transactions | |||||
Lease expense | $ 42,785 | ||||
Rent expense | $ 56,047 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2019 | |
Income Tax Disclosure [Line Items] | |||
Effective tax rate | 21.00% | 0.00% | |
Operating loss carryforwards | $ 2.8 | $ 2.8 | |
Income tax related interest or penalties assessed or recorded | 0 | ||
Income tax provision | $ 0 | ||
Federal | |||
Income Tax Disclosure [Line Items] | |||
Operating loss carryforwards | 2.6 | 2.6 | |
State | |||
Income Tax Disclosure [Line Items] | |||
Operating loss carryforwards | $ 2.1 | $ 2.1 |
Income Taxes - Income tax provi
Income Taxes - Income tax provision (benefit) (Details) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Dec. 31, 2019 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
U.S. federal income tax expense at the statutory rate | 21.00% | 0.00% |
State income taxes, net of federal taxes | 3.50% | |
Non-controlling interest | 1.40% | |
Other permanent items | (0.50%) | |
Change in valuation allowance | (25.40%) |
Income Taxes - Net deferred tax
Income Taxes - Net deferred taxes assets (Details) | Dec. 31, 2019USD ($) |
Components of Deferred Tax Assets [Abstract] | |
Net operating loss carryforwards | $ 663,177 |
Stock-based compensation | 65,597 |
Total deferred tax assets | 728,774 |
Less valuation allowance | $ (728,744) |
Subsequent Events (Successor) (
Subsequent Events (Successor) (Details) - USD ($) | Feb. 28, 2020 | Feb. 03, 2020 | Jan. 31, 2020 | Jan. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2019 |
Proceeds from the issuance of shares in private placement | $ 2,005,662 | |||||
Class A Common stock | ||||||
Proceeds from the issuance of shares in private placement | $ 350,009 | |||||
Class A Common stock | Common Stock | ||||||
Shares issued | 182,335 | |||||
Subsequent Event | Class A Common stock | Common Stock | ||||||
Shares issued | 90,910 | 39,628 | ||||
Proceeds from the issuance of shares in private placement | $ 1,000,010 | $ 435,908 | ||||
Smith Purchase Agreement | Subsequent Event | ||||||
Percentage of shares acquired | 60.00% | |||||
Consideration transferred | $ 3,000,000 | |||||
Smith Purchase Agreement | ANC Smith | Subsequent Event | ||||||
Percentage of shares acquired | 40.00% | |||||
Potter Purchase Agreement | Subsequent Event | ||||||
Percentage of shares acquired | 60.00% | |||||
Payments to acquire business | $ 1,680,000 |