Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 26, 2021 | Jun. 30, 2020 | |
Entity Registrant Name | Andover National Corp | ||
Entity Central Index Key | 0001712543 | ||
Trading Symbol | AANC | ||
Title of 12(g) Security | Class A Common Stock, par value $0.001 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
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 | 3,551,371 | ||
Class B Common stock | |||
Entity Common Stock, Shares Outstanding | 81,198 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | 2 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Dec. 31, 2020 | |
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor |
Current assets: | ||
Cash and cash equivalents | $ 11,407,971 | $ 14,302,699 |
Accounts receivable, net | 160,803 | 490,987 |
Prepaid expenses and other current assets | 31,702 | 49,547 |
Total current assets | 11,600,476 | 14,843,233 |
Non-current assets: | ||
Property and equipment, net | 245,953 | 2,147,918 |
Right-of-use asset, net | 220,294 | 258,523 |
Goodwill | 4,309,766 | 7,913,123 |
Intangible assets, net | 1,881,208 | 3,967,690 |
Total non-current assets | 6,657,221 | 14,287,254 |
TOTAL ASSETS | 18,257,697 | 29,130,487 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 587,584 | 685,364 |
Current portion of deferred consideration | 200,000 | 1,575,443 |
Notes payable | 385,963 | |
Lease liabilities | 42,970 | 82,225 |
Total current liabilities | 830,554 | 2,728,995 |
Non-current liabilities: | ||
Notes payable, net of current portion | 753,458 | |
Lease liabilities, net of current portion | 177,324 | 176,298 |
Deferred consideration, net of current portion | 300,000 | 346,884 |
Total non-current liabilities | 477,324 | 1,276,640 |
Total liabilities | 1,307,878 | 4,005,635 |
COMMITMENTS AND CONTINGENCIES | ||
Mezzanine equity: | ||
Redeemable noncontrolling interest | 3,265,892 | |
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 5,000,000 shares authorized, none issued and outstanding as of December 31, 2020 and 2019 | ||
Additional paid-in capital | 17,554,713 | 25,704,408 |
Accumulated deficit | (3,334,086) | (6,559,361) |
Total stockholders' equity | 14,222,392 | 19,147,545 |
Noncontrolling interest | 2,727,427 | 2,711,415 |
Total equity | 16,949,819 | 21,858,960 |
TOTAL LIABILITIES, MEZZANINE EQUITY AND EQUITY | 18,257,697 | 29,130,487 |
Class A Common stock | ||
Stockholders' equity: | ||
Common stock | 1,684 | 2,417 |
Class B Common stock | ||
Stockholders' equity: | ||
Common stock | $ 81 | $ 81 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common Stock, shares issued | 600 | |
Common Stock, shares outstanding | 600 | |
Class A Common stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common Stock, shares issued | 2,416,866 | 1,683,691 |
Common Stock, shares outstanding | 2,416,866 | 1,683,691 |
Class B Common stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 7,500,000 | 7,500,000 |
Common Stock, shares issued | 81,198 | 81,198 |
Common Stock, shares outstanding | 81,198 | 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, 2020 | |
Consolidated Statements of Operations | |||
Financial Designation, Predecessor and Successor [Fixed List] | Predecessor | Successor | |
Revenue | $ 683,265 | $ 1,957,025 | $ 7,702,866 |
Total revenues | 683,265 | 1,957,025 | 7,702,866 |
Operating costs and expenses: | |||
Cost of services provided | 280,847 | 928,275 | 4,113,893 |
General and administrative | 1,491,902 | 586,092 | 6,726,736 |
Sales and marketing | 12,003 | 117,352 | 207,497 |
Total operating costs and expenses | 1,784,752 | 1,631,719 | 11,048,126 |
Income (loss) from operations | (1,101,487) | 325,306 | (3,345,260) |
Other income (expense): | |||
Investment income | 37,589 | 34,976 | |
Other income | 809 | 120,644 | 191,400 |
Interest income | 94 | 3,858 | 6,036 |
Interest expense | (345) | (7,223) | |
Total other income | 38,492 | 124,157 | 225,189 |
Net income (loss) | (1,062,995) | 449,463 | (3,120,071) |
Less: Net loss attributable to noncontrolling interest | 60,760 | 105,204 | |
Net income (loss) attributable to common shareholders | $ (1,123,755) | $ 449,463 | $ (3,225,275) |
Net loss per common share | |||
Net loss per share attributable to Class A and Class B Common shareholders- Basic | $ (0.70) | $ (1.62) | |
Net loss per share attributable to Class A and Class B Common shareholders- Diluted | $ (0.70) | $ (1.62) | |
Weighted average shares outstanding | |||
Weighted average Class A and Class B Common shares outstanding- Basic | 1,612,172 | 1,996,044 | |
Weighted average Class A and Class B Common shares outstanding- Diluted | 1,612,172 | 1,996,044 |
Consolidated Statements of Equi
Consolidated Statements of Equity and Noncontrolling Interest - USD ($) | Class A Common stockCommon StockUnvested Restricted Stock Units | Class A Common stockCommon StockRestricted stock | Class A Common stockCommon Stock | Class A Common stockAdditional Paid-In CapitalUnvested Restricted Stock Units | Class A Common stockAdditional Paid-In CapitalRestricted stock | Class B Common stockCommon Stock | Parent [Member] | Common Stock | Additional Paid-In Capital | Retained Earnings/Accumulated Deficit | Non controlling Interest [Member] | Redeemable Noncontrolling InterestANC Green Solutions Potter's Purchase Agreement | Redeemable Noncontrolling InterestANC Green Solutions Smith purchase agreement | Redeemable Noncontrolling Interest | Total |
Beginning balance at Dec. 31, 2018 | $ 600 | $ 72,757 | $ 1,164,003 | $ 1,237,360 | |||||||||||
Beginning balance, shares at Dec. 31, 2018 | 600 | ||||||||||||||
Shareholder 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 | ||||||||||||||
Beginning balance at Dec. 31, 2018 | $ 600 | 72,757 | 1,164,003 | 1,237,360 | |||||||||||
Beginning balance, shares at Dec. 31, 2018 | 600 | ||||||||||||||
Ending balance at Dec. 31, 2019 | 14,222,392 | ||||||||||||||
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, 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 | |||||||||||||
Stock-based compensation | 200,839 | 200,839 | 200,839 | ||||||||||||
Issuance of Class A Common Stock in private placement, net of issuance costs | $ 182 | 2,005,662 | 2,005,480 | 2,005,662 | |||||||||||
Issuance of Class A Common Stock in private placement, net of issuance costs (in shares) | 182,335 | ||||||||||||||
Impact on non-controlling interest from acquisition of ANC Green Solutions I | 2,666,667 | 2,666,667 | |||||||||||||
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 | 14,222,392 | ||||||||||||||
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, shares at Dec. 31, 2019 | 1,683,691 | 81,198 | |||||||||||||
Impact on non-controlling interest from acquisition | $ 1,145,363 | $ 2,000,197 | |||||||||||||
Stock-based compensation | 980,649 | 980,649 | 980,649 | ||||||||||||
Issuance of Class A Common Stock for vested RSUs and restricted stock | $ 49 | $ 10 | $ (49) | $ (10) | |||||||||||
Issuance of Class A Common Stock for vested RSUs and restricted stock (in shares) | 49,424 | 10,000 | |||||||||||||
Issuance of Class A Common Stock in private placement, net of issuance costs | $ 674 | 7,169,779 | 7,169,105 | 7,169,779 | |||||||||||
Issuance of Class A Common Stock in private placement, net of issuance costs (in shares) | 673,751 | ||||||||||||||
Distribution to noncontrolling interest | (400) | $ (484) | (400) | ||||||||||||
Net income (loss) | (3,225,275) | (3,225,275) | (15,612) | 120,816 | (3,240,887) | ||||||||||
Ending balance at Dec. 31, 2020 | 19,147,545 | ||||||||||||||
Ending balance at Dec. 31, 2020 | $ 2,417 | $ 81 | $ 19,147,545 | $ 25,704,408 | $ (6,559,361) | $ 2,711,415 | $ 3,265,892 | $ 21,858,960 | |||||||
Ending balance, shares at Dec. 31, 2020 | 2,416,866 | 81,198 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Cash Flows from Operating Activities: | |||
Net income (loss) | $ (1,062,995) | $ 449,463 | $ (3,120,071) |
Reconciliation of net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 100,884 | 62,107 | 1,158,436 |
Stock-based compensation | 200,839 | 980,649 | |
Loss on disposal of fixed asset | 41,485 | ||
Bad debt expense | 24,695 | ||
Forgiveness of note payable | (191,400) | ||
Changes in operating assets and liabilities (excluding the effects of business acquisitions): | |||
Accounts receivable | 15,902 | (29,894) | (82,168) |
Prepaid expenses and other current assets | (2,400) | (9,643) | (15,654) |
Accounts payable and accrued expenses | 342,422 | 97,598 | (67,306) |
Net cash provided by (used in) operating activities | (405,348) | 611,116 | (1,312,819) |
Cash Flows from Investing Activities: | |||
Purchase of property and equipment | (58,921) | (48,338) | (996,795) |
Proceeds received from disposal of property and equipment | 37,490 | ||
Acquisition of ANC Potter's, net of cash acquired | (1,529,280) | ||
Acquisition of ANC Smith's, net of cash acquired | (1,651,114) | ||
Acquisition of ANC Green Solutions I, net of cash acquired | (3,431,837) | ||
Net cash used in investing activities | (3,490,758) | (48,338) | (4,139,699) |
Cash Flows from Financing Activities: | |||
Proceeds from notes payable | 1,238,796 | ||
Repayment of notes payable | (20,473) | (60,445) | |
Capital distribution | (1,247,448) | ||
Distribution to noncontrolling interest | (884) | ||
Proceeds from the issuance shares in private placement, net of issuance costs | 2,005,662 | 7,169,779 | |
Net cash provided by (used in) financing activities | 2,005,662 | (1,267,921) | 8,347,246 |
Net increase (decrease) in cash | (1,890,444) | (705,143) | 2,894,728 |
Cash and cash equivalents, beginning of the period | 13,298,415 | 899,653 | 11,407,971 |
Cash and cash equivalents, end of the period | 11,407,971 | 194,510 | 14,302,699 |
Supplemental disclosure of cash flow information | |||
Cash paid for interest | $ 345 | 7,184 | |
Issuance of Class A shares for vested RSUs | 59 | ||
Capital expenditures financed through notes payable | 13,348 | ||
Recognition of deferred consideration payable in acquisition of ANC Potter's | 146,884 | ||
Recognition of deferred consideration payable in acquisition of ANC Smith's | 1,275,443 | ||
Recognition of redeemable noncontrolling interest in acquisition of ANC Potter's | 1,145,363 | ||
Recognition of redeemable noncontrolling interest in acquisition of ANC Smith's | $ 2,000,197 | ||
Recognition of noncontrolling interest in acquisition of ANC Green Solutions I | $ 2,666,667 | ||
Financial Designation, Predecessor and Successor [Fixed List] | Predecessor | Successor |
Nature of the Business
Nature of the Business | 12 Months Ended |
Dec. 31, 2020 | |
Nature of the Business | |
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 $4.0 million, subject to certain adjustments (the “Business Combination”). ANC Green Solutions I, LLC, formerly known as Legg Holdings, Inc. (“ANC Green Solutions I” 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 I’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 I is a master franchisor for outdoor insect control service businesses operating independently throughout the United States. On February 3, 2020, ANC Green Solutions - Potter’s, LLC, a wholly-owned subsidiary of the Company (“ANC Potter’s”), entered into an Asset Purchase and Contribution Agreement with Potter’s Professional Lawn Care, Inc, and its shareholders, pursuant to which ANC Potter’s purchased a sixty (60%) interest in Potter’s Professional Lawncare, Inc.’s property and assets, for $1.68 million, subject to certain adjustments. Potter’s Professional Lawn Care, Inc., a Florida corporation, is engaged in the business of commercial and residential fully-integrated lawn maintenance and landscape services including lawn care, new landscape design and installation, pest control, irrigation and arbor care. On February 28, 2020, Smith’s Tree Care, LLC, a wholly-owned subsidiary of the Company (“Smith’s Buyer”), entered into an Asset and Equity Purchase and Contribution Agreement (the “Smith Acquisition Agreement”) with Smith’s Tree Care, Inc., a Virginia corporation (“Smith’s Seller”), Utro Crane Company, Inc., a Virginia corporation, Utro Crane Company, LLC, a Delaware limited liability company and indirect subsidiary of the Company, and ANC Green Solutions - Smith’s, LLC, a Delaware limited liability company and indirect subsidiary of the Company (“ANC Smith’s”). Pursuant to the Smith Acquisition Agreement, among other things, (a) Smith’s Buyer acquired a sixty percent (60%) interest in all of property and assets of Smith Tree Care, Inc. and Utro Crane Company, Inc, (together, the “Seller Parties”) for an aggregate purchase price of approximately $3.0 million, subject to certain adjustments and (b) Smith’s 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 Seller Parties are engaged in the business of commercial and residential fully-integrated tree care, tree service, tree removal, stump grinding, mulching, logging, and related services. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |
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 I 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 I. 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 I's 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 and noncontrolling interest. 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 I, ANC Potter’s and ANC Smith’s. The accompanying Predecessor consolidated financial statements include the accounts of ANC Green Solutions I and its consolidated subsidiaries, Legg Lawncare, Inc. and Legg SMS Franchising, Inc. All material inter-company balances and transactions have been eliminated. Redeemable Noncontrolling Interest The Company classifies noncontrolling interests that contain an option of the noncontrolling shareholders to require the Company to purchase their interest as redeemable noncontrolling interests within mezzanine equity on the Company’s consolidated balance sheet. 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, 2020. 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 year ended December 31, 2020 (Successor), the period from October 4, 2019 through December 31, 2019 (Successor) and the period January 1, 2019 through October 3, 2019 (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 Year Ended October 4, 2019 January 1, 2019 December 31, through through 2020 December 31, 2019 October 3, 2019 Allowance for doubtful accounts, beginning of period $ 2,467 $ — $ 34,976 Bad debt expense 24,695 2,467 — Allowance for doubtful accounts, end of period $ 27,162 $ 2,467 $ 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, 2020 and 2019, 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 Buildings 15 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 (Successor) 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. Leases (Predecessor) 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 for the year ended December 31, 2020 and for 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, 2020 and 2019, 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 $19,500 ($26,000 for employees 50 years or over) for 2020. The Company contributed approximately $27,000, $6,000 and $5,000 during the year ended December 31, 2020 (Successor), the period October 4, 2019 through December 31, 2019 (Successor) and the period January 1, 2019 through October 3, 2019 (Predecessor), respectively. 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. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments- Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). This guidance introduces a new model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses. ASU 2016-13 also provides updated guidance regarding the impairment of available-for-sale debt securities and includes additional disclosure requirements. The new guidance is effective for public business entities that meet the definition of a Smaller Reporting Company as defined by the Securities and Exchange Commission for interim and annual periods beginning after December 15, 2022. Early adoption is permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles- Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), which simplifies goodwill impairment testing. This new guidance is effective for public business entities that meet the definition of a Smaller Reporting Company as defined by the Securities and Exchange Commission for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2022. Early adoption is 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, 2020 | |
Revenue | |
Revenue | Note 3 – Revenue The following table presents the Company’s revenue disaggregated by source: Successor Predecessor Year Ended October 4, 2019 January 1, 2019 December 31, through through 2020 December 31, 2019 October 3, 2019 Lawncare and tree care service revenue $ 7,620,131 $ 665,323 $ 1,880,694 Franchise revenue 82,735 17,942 76,331 Total revenue $ 7,702,866 $ 683,265 $ 1,957,025 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 and from tree care services, which includes tree trimming service, tree removal, stump grinding, mulching, logging and related 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. 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, 2020 | |
Business Combination (Successor) | |
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 I for $4.0 million in cash, consisting of $3.5 million paid at the closing of the Business Combination and $0.5 million 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 allocation of the purchase price to the assets acquired and liabilities assumed for the acquisition of ANC Green Solutions I (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 industry know-how and is 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 I, 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, 2019. 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, 2019, 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 Total revenue $ 2,640,290 Net loss (2,003,167) 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 $0.3 million and the elimination of transaction costs of $0.1 million. ANC Green Solutions Potter’s As described in Note 1, on February 3, 2020, the Company acquired a 60% membership interest in ANC Potter’s for $1.68 million in cash, consisting of approximately $1.5 million paid at closing and $0.147 million in deferred consideration to be paid on the two- year anniversary of the closing of the acquisition. The following table presents the preliminary allocation of the purchase price to the assets acquired and liabilities assumed for the acquisition of ANC Potter’s (in thousands): Accounts receivable and other current assets $ 107 Property and equipment 234 Right-of-use asset 113 Intangible assets 1,285 Goodwill 1,418 Accounts payable and accrued expenses (84) Lease liability (113) Notes payable (139) Deferred cash consideration (147) Non-controlling interest in ANC Green Solutions- Potters (1,145) Cash purchase price, net of cash acquired $ 1,529 The Company identified tradename, customer relationship and non-compete intangible assets. The tradename, customer relationship and non-compete intangible assets 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 industry know-how and is expected to be deductible for income tax purposes. The ANC Potter’s acquisition resulted in a redeemable noncontrolling interest, which has been classified as mezzanine equity due to the option of the noncontrolling shareholders to require the Company to purchase their interest. The acquisition-date fair value of the noncontrolling interest was determined using a market approach based on the transaction price observed in the ANC Potter’s acquisition. The year ended December 31, 2020 includes the operations of ANC Potter’s for the period from February 3, 2020, the date of acquisition, to December 31, 2020. The consolidated statement of operations for the year ended December 31, 2020, includes revenue of approximately $1.8 million and loss from operations of approximately $0.2 million, including intangible amortization expense, contributed by ANC Potter’s. In the year ended December 31, 2020, the Company incurred approximately $0.1 million of transaction costs related to the acquisition of ANC Potter’s. Unaudited Pro forma Financial Information The following pro forma financial information presents the combined results of operations for the Company and gives effect to the ANC Potter’s acquisition discussed above as if it had occurred on January 1, 2019. 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 ANC Potters acquisition had been completed on January 1, 2019, 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 and does not include the pro forma effect of the other business combinations which occurred during the periods presented. Year Ended December 31, 2020 2019 Total revenue $ 7,895,195 $ 4,819,389 Net loss (3,033,509) For purposes of the pro forma disclosures above, the primary adjustments for the year ended December 31, 2020 include the amortization of intangible assets of approximately $16,000 and the elimination of transaction costs of approximately $0.1 million. For purposes of the pro forma disclosures above, the primary adjustments for the year ended December 31, 2019 include amortization of intangible assets of approximately $0.2 million. ANC Green Solutions Smith’s As described in Note 1, on February 28, 2020, the Company acquired a 60% membership interest in ANC Smith’s for $3.0 million cash, consisting of $2.6 million paid at closing and an aggregate of $0.4 million in deferred consideration to be paid on the one- and two- year anniversary of the closing of acquisition. In addition, the ANC Smith’s acquisition agreement provides that the Smith Seller is entitled to an amount, if any, by which the final working capital, as defined in the agreement, delivered by the Smith Seller is greater than the target working capital provided for in the agreement, (the “Smith Working Capital Adjustment”). As of December 31, 2020, the Company’s preliminary estimate of the Smith Working Capital Adjustment due to Smith Seller is $0.9 million and is included in Current portion of deferred consideration on the Company’s consolidated balance sheet. The following table presents the preliminary allocation of the purchase price to the assets acquired and liabilities assumed for the acquisition of ANC Smith’s (in thousands): Accounts receivable and other current assets $ 167 Property and equipment 1,117 Intangible assets 1,537 Goodwill 2,186 Accounts payable and accrued expenses (80) Deferred cash consideration (1,276) Non-controlling interest in ANC Green Solutions- Smith (2,000) Cash purchase price, net of cash acquired $ 1,651 The Company identified tradename, customer relationship and non-compete intangible assets. The tradename, customer relationships and non-compete intangible assets 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 industry know-how and is expected to be deductible for income tax purposes. The ANC Smith’s acquisition resulted in a redeemable noncontrolling interest, which has been classified as mezzanine equity due to the option of the noncontrolling shareholders to require the Company to purchase their interest. The acquisition-date fair value of the noncontrolling interest was determined using a market approach based on the transaction price observed in the acquisition of ANC Smith’s. The year ended December 31, 2020 includes the operations of ANC Smith’s for the period from February 28, 2020, the date of acquisition, to December 31, 2020. The consolidated statement of operations for the year ended December 31, 2020, includes revenue of approximately $3.3 million and income from operations, including amortization expense, of approximately $0.3 million contributed by ANC Smith’s. During the year ended December 31, 2020, the Company incurred approximately $0.1 million of transaction costs related to the acquisition of ANC Smith’s. Unaudited Pro forma Financial Information The following pro forma financial information presents the combined results of operations for the Company and gives effect to the ANC Smith’s acquisition discussed above as if it had occurred on January 1, 2019. 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 ANC Smith’s acquisition had been completed on January 1, 2019, 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 and does not include the pro forma effect of the other business combinations which occurred during the periods presented. Year Ended December 31, 2020 2019 Total revenue $ 8,170,261 $ 6,248,542 Net loss (3,040,376) (155,570) For purposes of the pro forma disclosures above, the primary adjustments for the year ended December 31, 2020 include the amortization of intangible assets of approximately $0.05 million and the elimination of transaction costs of approximately $0.1 million. For purposes of the pro forma disclosures above, the primary adjustments for the year ended December 31, 2019 include amortization of intangible assets of approximately $0.3 million. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property and Equipment | |
Property and Equipment | Note 5‑ Property and Equipment December 31, 2020 2019 Vehicles $ 469,399 $ 101,410 Equipment 1,815,095 119,276 Land 174,585 — Buildings 51,947 — Leasehold improvements 66,886 42,163 Office equipment 5,892 2,196 Total property and equipment 2,583,804 265,045 Less: Accumulated depreciation (435,886) (19,092) Property and equipment, net $ 2,147,918 $ 245,953 Depreciation expense was $0.4 million for the year ended December 31, 2020, $0.02 million for the period October 4, 2019 through December 31, 2019 (Successor), $0.06 million for the period January 1, 2019 through October 3, 2019 (Predecessor). |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Successor) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets (Successor) | |
Goodwill and Intangible Assets (Successor) | Note 6‑ Goodwill and Intangible Assets (Successor) Changes in goodwill during the year ended December 31, 2020 and the period October 4, 2019 through December 31, 2019 is as follows: Balance at October 4, 2019 $ — Acquisition of ANC Green Solutions I 4,309,766 Balance at December 31, 2019 4,309,766 Acquisition of ANC Smith's 2,185,748 Acquisition of ANC Potter's 1,417,609 Balance at December 31, 2020 $ 7,913,123 As of December 31, 2020 and 2019, the Company’s intangible assets consisted of the following: Weighted average December 31, 2020 amortization period (in years) Gross Accumulated Amortization Net Tradenames $ 932,000 $ (125,708) $ 806,292 Customer relationships 3,289,000 (611,709) 2,677,291 Non-compete agreements 564,000 (79,893) 484,107 $ 4,785,000 $ (817,310) $ 3,967,690 Weighted average December 31, 2019 amortization period (in years) 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 Amortization expense was $0.7 million and $0.1 million for the year ended December 31, 2020 and the successor period October 4, 2019 to December 31, 2019, respectively. The estimated aggregate amortization expense for intangible assets over the next five fiscal years and thereafter is as follows: 2021 797,920 2022 797,920 2023 797,920 2024 781,670 2025 535,087 Thereafter 257,173 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases | |
Leases | Note 7‑ Leases Successor The Company leases facilities under agreements classified as operating leases that expire in 2023 and 2024. The Company’s leases include 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, 2020 and 2019, the Company had operating lease liabilities of approximately $0.3 million and $0.2 million, respectively and right of use assets of approximately $0.3 million and $0.2 million, respectively. Lease expenses during the year ended December 31, 2020 and the period October 4, 2019 through December 31, 2019 is as follows: Successor Year Ended October 4, 2019 December 31, through 2020 December 31, 2019 Operating leases Operating lease cost $ 89,500 $ 12,750 Operating lease expense 89,500 12,750 Short-term lease rent expense 78,574 18,418 Total rent expense $ 168,074 $ 31,168 The weighted-average remaining lease term as of December 31, 2020 is 2.93 years. The weighted-average discount rate is 5%. Supplemental cash flow information related to the Company’s leases is as follows: Successor Year Ended October 4, 2019 December 31, through 2020 December 31, 2019 Operating leases Operating cash flows from operating leases $ 89,500 $ 12,750 The maturity of the Company's operating leases are as follows: 2021 $ 2022 2023 2024 2025 — Thereafter — Total Less: Interest Present value of lease liabilities $ Predecessor Rent expense during the period January 1, 2019 through October 3, 2019 was approximately $0.04 million. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities (Successor) | 12 Months Ended |
Dec. 31, 2020 | |
Accounts Payable and Accrued Liabilities (Successor) | |
Accounts Payable and Accrued Liabilities (Successor) | Note 8 – Accounts Payable and Accrued Liabilities As of December 31, 2020 and 2019, the Company’s accounts payable and accrued liabilities consisted of the following: December 31, 2020 2019 Accounts payable $ 317,038 $ 138,712 Accrued professional fees 197,597 235,124 Accrued franchise tax 77,600 200,000 Accrued payroll 26,423 13,748 Due to noncontrolling interest — Accounts payable and accrued liabilities $ $ 587,584 |
Notes Payable (Successor)
Notes Payable (Successor) | 12 Months Ended |
Dec. 31, 2020 | |
Notes Payable (Successor) | |
Notes Payable (Successor) | Note 9– Notes Payable (Successor) Notes payable consists of the following: December 31, 2020 2019 Equipment notes $ 761,075 $ — PPP loans 378,346 — 1,139,421 — Less: current portion of Notes Payable (385,963) — Notes payable, net of current portion $ 753,458 $ — Equipment notes During the year ended December 31, 2020, ANC Smith’s entered into secured loan agreements with an aggregate principal balance of $0.7 million for the purchase of certain equipment. The equipment notes bear interest at a fixed rate of 2.85% and are due to be repaid in monthly installments over their five year terms. ANC Potters is party equipment loan agreements, the proceeds of which were used to purchase certain equipment and a truck. The loans have remaining terms ranging from less than one year to four years and bear a weighted average annual interest rate of 4.5%. During the year ended December 31, 2020, the Company made aggregate principal payments of approximately $0.06 million. PPP loans In April 2020, ANC Green Solutions I, ANC Potter’s and ANC Smith’s each qualified for and received a loan pursuant to the Paycheck Protection Program, a program implemented by the U.S. Small Business Administration (“SBA”) under the Coronavirus Aid, Relief, and Economic Security Act, from qualified lenders. The PPP Loans bear interest at a fixed rate of 1.0% per annum, have terms of two years, and are unsecured and guaranteed by the SBA. The principal amounts of the PPP Loans are subject to forgiveness under the Paycheck Protection Program upon the Company’s request to the extent that the PPP Loan proceeds are used to pay expenses permitted by the Paycheck Protection Program, including payroll costs, covered rent and mortgage obligations, and covered utility payments incurred by the borrower. During the three months ended December 31, 2020, the Company applied for forgiveness of the PPP Loans with respect to these covered expenses. ANC Smith’s forgiveness application was accepted in November 2020 and the Company recognized $0.2 million in Other income on its consolidated statement of operations. As of December 31, 2020, the applications for forgiveness for ANC Potter’s and ANC Green Solutions I’s PPP Loans are in process. In March 2021, ANC Potter’s PPP loan forgiveness application was accepted. To the extent that all or part of the PPP Loans are not forgiven, the Company will be required to pay interest on the PPP Loan at a rate of 1.0% per annum, and commencing when the SBA makes a forgiveness determination or 10 months after the covered period, principal and interest payments will be required through the maturity dates in April 2022. The terms of the PPP Loans provide for customary events of default including, among other things, payment defaults, breach of representations and warranties, and insolvency events. The PPP Loans may be accelerated upon the occurrence of an event of default. |
Stockholders Equity
Stockholders Equity | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders Equity | |
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, 2020. No shares of preferred stock were issued or are outstanding as of December 31, 2020 and 2019. Common Stock The Company has authorized 67.5 million shares of common stock, $0.001 par value per share as of December 31, 2020, 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. During the year ended December 31, 2020, the Company entered into separate subscription agreements with certain accredited investors, pursuant to which the Company, in private placements, issued and sold to the accredited investors an aggregate of 673,751 shares of its Class A Common Stock, at an offering price of $11.00 per share, for gross proceeds to the Company of $7.4 million and net proceeds of $7.1 million. 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 $2.0 million. 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. As of December 31, 2020 and 2019, there are 2,416,866 and 1,683,691 shares of Class A Common Stock outstanding, respectively. 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, 2020 and 2019, there are 81,198 shares of Class B Common Stock outstanding. Warrants As of December 31, 2020, the Company’s outstanding warrants are as follows: Outstanding as of December 31, 2020 Exercise Price Expiration Date Class W‑1 Warrant $ 12.50 September 25, 2028 Class W‑2 Warrant $ 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, 2020 is as follows: Weighted average remaining contractual life Warrants Weighted exercise price (in years) Outstanding as of October 4, 2019 3,150,000 $ 13.75 9.0 Forfeited 13.75 — Outstanding as of December 31, 2019 $ 13.75 8.7 Forfeited — — — Outstanding as of December 31, 2020 $ 13.75 7.7 Exercisable — $ — Predecessor Prior to the Business Combination there were 600 issued and outstanding shares of ANC Green Solutions, Inc.I. |
Share-based Compensation (Succe
Share-based Compensation (Successor) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Compensation (Successor) | |
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, 2020, an aggregate of 1,084,132 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, 2020, 919,700 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, 2020. The Company recorded total share-based compensation expense of $1.0 million and $0.2 million for the year ended December 31, 2020 and for the period October 4, 2019 to December 31, 2019, respectively. Restricted Stock During the year ended December 31, 2020, 10,000 shares of restricted stock vested with a weighted average grant date fair value of $10 per share. The fair market value of restricted stock vesting during the year ended December 31, 2020 was $110,000. Restricted Stock Units Below is a table summarizing the unvested restricted stock units for period from October 4, 2019 through December 31, 2020: Weighted average grant- Units date fair value Unvested as of October 4, 2019 — $ — Granted Unvested as of December 31, 2019 $ Granted Forfeited $ Vested Unvested as of December 31, 2020 $ Total unrecognized expense remaining $ Weighted average years expected to be recognized over The fair value of restricted stock units that vested during the year ended December 31, 2020 was approximately $0.5 million. |
Income (Loss) Per Common Share
Income (Loss) Per Common Share (Successor) | 12 Months Ended |
Dec. 31, 2020 | |
Income (Loss) Per Common Share (Successor) | |
Income (Loss) Per Common Share (Successor) | 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 year ended December 31, 2020 (Successor) and 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: Year Ended October 4, 2019 December 31, through 2020 December 31, 2019 Numerator: Net loss attributable to common shareholders $ (3,225,275) $ (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 $ (1.62) $ (0.70) Net loss per shares attributable to Class A and Class B Common shareholders- Diluted $ (1.62) $ (0.70) The following potentially dilutive securities outstanding for the Successor periods ended December 31, 2020 and 2019 have been excluded from the computation of diluted weighted average shares outstanding, as they would be antidilutive. December 31, 2020 2019 Unvested Restricted Stock Units 105,008 150,000 Unvested Restricted Stock — 10,000 Warrants 2,250,000 2,250,000 2,355,008 2,410,000 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions | |
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 approximately $79,000 and $18,400 to Mr. Cohen during the year ended December 31, 2020 and for the period of October 4, 2019 through December 31, 2019, respectively, 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. The lease agreement is for a period of five years. The Company paid $51,000 and $12,750 during the year ended December 31, 2020 and for period of October 4, 2019 through December 31, 2019, respectively, related to this lease agreement. In connection with the Potters Acquisition, the Company entered into a lease agreement with the minority interest holders of ANC Potter’s. The lease agreement is for a period of three years. The Company paid $38,500 during the year ended December 31, 2020 related to this agreement. On January 30, 2020, the Company entered into a subscription agreement at an offering price of $11.00 per share, with PENSCO Trust Company Custodian FBO Peter Cohen SEP IRA, on behalf of Peter A. Cohen, for 22,728 shares of Class A Common Stock in exchange for $250,000 cash. In addition, on January 30, 2020, the Company entered into a subscription agreement at an offering price of $11.00 per share, with PENSCO Trust Company LLC, Custodian FBO Milun K. Patel IRA, on behalf of Milun K. Patel, for 6,900 shares of Class A Common Stock in exchange for $75,900 cash. 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 distributions for the period of January 1, 2019 through October 3, 2019 were approximately $1.2 million. During the period January 1, 2019 through October 3, 2019, the Company was party to a lease agreement with a shareholder of the Company. The Company paid approximately $43,000 to a shareholder during the period of January 1, 2019 through October 3, 2019 related to this lease agreement. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
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 the year ended December 31, 2020 and for period from October 4, 2019 through December 31, 2019. For the Year Ended October 4, 2019 December 30, through 2020 December 31, 2019 Statutory federal income tax rate 21.0 % % State income taxes, net of federal taxes 3.6 % % Non-controlling interest 0.0 % % Other permanent items (0.2) % % Change in valuation allowance (24.4) % % Income taxes provision (benefit) 0.0 % 0.0 % Net deferred tax assets consist of the following components: December 31, 2020 2019 Deferred tax assets: Net operating loss carryforwards 1,334,445 663,177 Stock-based compensation 141,914 65,597 Amortization 973 — Passthrough entity 178,676 — Other 45 — Total deferred income tax assets 1,656,053 728,774 Deferred tax liabilities: Depreciation — — — — Valuation allowance (1,656,053) (728,774) Deferred tax asset, net of allowance — — 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 year ended December 31, 2020 and 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, 2020. 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, 2020 and 2019, the Company had net operating loss carryforwards of approximately $5.6 million and $2.8 million. Federal net operating losses of approximately $5.6 million carryforward indefinitely. State operating loss carryforwards of approximately $5.4 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 year ended December 31, 2020 and 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, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events (Successor) | Note 15 – Subsequent Events (Successor) On January 20, 2021, the Company, through an indirect wholly owned subsidiary, entered into an Asset and Equity Purchase and Contribution Agreement (the “Zodega Purchase Agreement”) with Litton Enterprises Inc. D/B/A Zodega-TIS Services, a Texas corporation (“Zodega Seller”), the Zodega Seller shareholders and ANC Green Solutions- Zodega, LLC, a Delaware limited liability company (“ANC Zodega”), pursuant to which, among other things, (i) the Company purchased an undivided fifty-one percent (51%) interest in all of Zodega Seller’s right, title and interest in and to all of Zodega Seller’s property and assets (the “Acquired Assets”), in consideration for 51,290 shares of the Company’s Class A common stock, with a value of approximately $0.6 million, subject to certain adjustments, as set forth in the Zodega Purchase Agreement and (ii) Zodega Seller conveyed, transferred, assigned and delivered to ANC Zodega’s an undivided forty percent (49%) interest in the Acquired Assets in exchange for equity securities of ANC Zodega’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 January 26, 2021, the Company’s subsidiary ANC Green Solutions- Zodega made a capital call, as defined in the limited liability agreement of ANC Zodega, of $0.9 million, to fund the acquisition of substantially all of the assets and property of Texas Seasons Corporation through the Company’s indirect subsidiary and ANC Zodega’s wholly owned subsidiary Zodega Landscape Services, LLC. In connection with funding the capital call for the acquisition, the Company entered into a promissory note agreement with Litton Enterprises Inc. for $0.5 million. The promissory note agreement bears interest at a rate of WSJ Prime plus 7.0% and is due to be repaid by the minority interest holder to the Company on the fourth anniversary of the note agreement. On February 18, 2021, Company’s subsidiary ANC Green Solutions- Zodega made a capital call, as defined in the limited liability agreement of ANC Zodega, of $0.3 million, to fund the acquisition of substantially all of the assets and property of Greentex Landscaping Inc., through the Company’s indirect subsidiary and ANC Zodega’s wholly owned subsidiary Zodega Landscape Services, LLC. In connection with funding the capital call for the acquisition, the Company entered into a promissory note agreement with Litton Enterprises Inc. for $0.2 million. The promissory note agreement bears interest at a rate of Prime plus 7.0% and is due to be repaid by the minority interest holder to the Company on the fourth anniversary of the note agreement. On February 19, 2021, Company’s subsidiary ANC Green Solutions- Zodega made a capital call, as defined in the limited liability agreement of ANC Zodega, of $2.2 million, to fund the acquisition of substantially all of the assets and property of C.J.’s Yardworks, Inc. through the Company’s indirect subsidiary and ANC Zodega’s wholly owned subsidiary Zodega Landscape Services, LLC. In connection with funding the capital call for the acquisition, the Company entered into a promissory note agreement with Litton Enterprises Inc. for $1.1 million. The promissory note agreement bears interest at a rate of Prime plus 7.0% and is due to be repaid by the minority interest holder to the Company on the fourth anniversary of the note agreement. On February 1, 2021, the Company and each of Blumenthal Family Investment Joint Venture, L.P., Jeffrey C. Piermont and The Peter A. Cohen Revocable Trust (the “Warrant Holders”) entered into Warrant Cancellation Agreements with the Company in order to terminate the Warrants and to refund the Warrant Holders the original purchase price for the Warrants. On March 12, 2021, Company’s subsidiary ANC Green Solutions- Zodega made a capital call, as defined in the limited liability agreement of ANC Zodega, of $0.8 million, to fund the acquisition of substantially all of the assets and property of Lillard Lawn & Landscaping, Inc. through the Company’s indirect subsidiary and ANC Zodega’s wholly owned subsidiary Zodega Landscape Services, LLC. In connection with funding the capital call for the acquisition, the Company entered into a promissory note agreement with Litton Enterprises Inc. for $0.4 million. The promissory note agreement bears interest at a rate of Prime plus 7.0% and is due to be repaid by the minority interest holder to the Company on the fourth anniversary of the note agreement. Subsequent to December 31, 2020 the Company entered into subscription agreements with additional investors and issued and sold an aggregate of $1,020,616 shares of Class A Common Stock to such additional investors for total gross proceeds to the Company of approximately $11.2 million. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |
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 I 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 I. 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 I's 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 and noncontrolling interest. 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 I, ANC Potter’s and ANC Smith’s. The accompanying Predecessor consolidated financial statements include the accounts of ANC Green Solutions I and its consolidated subsidiaries, Legg Lawncare, Inc. and Legg SMS Franchising, Inc. All material inter-company balances and transactions have been eliminated. |
Redeemable Noncontrolling Interest | Redeemable Noncontrolling Interest The Company classifies noncontrolling interests that contain an option of the noncontrolling shareholders to require the Company to purchase their interest as redeemable noncontrolling interests within mezzanine equity on the Company’s consolidated balance sheet. |
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, 2020. |
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 year ended December 31, 2020 (Successor), the period from October 4, 2019 through December 31, 2019 (Successor) and the period January 1, 2019 through October 3, 2019 (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 Year Ended October 4, 2019 January 1, 2019 December 31, through through 2020 December 31, 2019 October 3, 2019 Allowance for doubtful accounts, beginning of period $ 2,467 $ — $ 34,976 Bad debt expense 24,695 2,467 — Allowance for doubtful accounts, end of period $ 27,162 $ 2,467 $ 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, 2020 and 2019, 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 Buildings 15 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 (Successor) 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. Leases (Predecessor) 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 for the year ended December 31, 2020 and for 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, 2020 and 2019, 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 $19,500 ($26,000 for employees 50 years or over) for 2020. The Company contributed approximately $27,000, $6,000 and $5,000 during the year ended December 31, 2020 (Successor), the period October 4, 2019 through December 31, 2019 (Successor) and the period January 1, 2019 through October 3, 2019 (Predecessor), respectively. |
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. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments- Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). This guidance introduces a new model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses. ASU 2016-13 also provides updated guidance regarding the impairment of available-for-sale debt securities and includes additional disclosure requirements. The new guidance is effective for public business entities that meet the definition of a Smaller Reporting Company as defined by the Securities and Exchange Commission for interim and annual periods beginning after December 15, 2022. Early adoption is permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles- Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), which simplifies goodwill impairment testing. This new guidance is effective for public business entities that meet the definition of a Smaller Reporting Company as defined by the Securities and Exchange Commission for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2022. Early adoption is 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, 2020 | |
Summary of Significant Accounting Policies | |
Schedule of roll forward of the allowance for doubtful accounts | Successor Predecessor Year Ended October 4, 2019 January 1, 2019 December 31, through through 2020 December 31, 2019 October 3, 2019 Allowance for doubtful accounts, beginning of period $ 2,467 $ — $ 34,976 Bad debt expense 24,695 2,467 — Allowance for doubtful accounts, end of period $ 27,162 $ 2,467 $ 34,976 |
Schedule of estimated useful lives of property and equipment | Useful Lives (in years) Vehicles 5-10 Equipment 5-7 Buildings 15 Leasehold improvements 5 Office equipment 5-7 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue | |
Schedule of revenue disaggregated by source | Successor Predecessor Year Ended October 4, 2019 January 1, 2019 December 31, through through 2020 December 31, 2019 October 3, 2019 Lawncare and tree care service revenue $ 7,620,131 $ 665,323 $ 1,880,694 Franchise revenue 82,735 17,942 76,331 Total revenue $ 7,702,866 $ 683,265 $ 1,957,025 |
Business Combination (Success_2
Business Combination (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Acquisition [Line Items] | |
Preliminary allocation of purchase price to assets acquired and liabilities assumed for acquisition | The following table presents the allocation of the purchase price to the assets acquired and liabilities assumed for the acquisition of ANC Green Solutions I (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 pro forma financial information | Year Ended December 31, 2019 Total revenue $ 2,640,290 Net loss (2,003,167) |
ANC Green Solutions Potter's Purchase Agreement | |
Business Acquisition [Line Items] | |
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 Potter’s (in thousands): Accounts receivable and other current assets $ 107 Property and equipment 234 Right-of-use asset 113 Intangible assets 1,285 Goodwill 1,418 Accounts payable and accrued expenses (84) Lease liability (113) Notes payable (139) Deferred cash consideration (147) Non-controlling interest in ANC Green Solutions- Potters (1,145) Cash purchase price, net of cash acquired $ 1,529 |
Schedule of pro forma financial information | Year Ended December 31, 2020 2019 Total revenue $ 7,895,195 $ 4,819,389 Net loss (3,033,509) |
ANC Green Solutions Smith purchase agreement | |
Business Acquisition [Line Items] | |
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 Smith’s (in thousands): Accounts receivable and other current assets $ 167 Property and equipment 1,117 Intangible assets 1,537 Goodwill 2,186 Accounts payable and accrued expenses (80) Deferred cash consideration (1,276) Non-controlling interest in ANC Green Solutions- Smith (2,000) Cash purchase price, net of cash acquired $ 1,651 |
Schedule of pro forma financial information | Year Ended December 31, 2020 2019 Total revenue $ 8,170,261 $ 6,248,542 Net loss (3,040,376) (155,570) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property and Equipment | |
Schedule of property and equipment | December 31, 2020 2019 Vehicles $ 469,399 $ 101,410 Equipment 1,815,095 119,276 Land 174,585 — Buildings 51,947 — Leasehold improvements 66,886 42,163 Office equipment 5,892 2,196 Total property and equipment 2,583,804 265,045 Less: Accumulated depreciation (435,886) (19,092) Property and equipment, net $ 2,147,918 $ 245,953 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets (Successor) | |
Summary of changes in goodwill | Balance at October 4, 2019 $ — Acquisition of ANC Green Solutions I 4,309,766 Balance at December 31, 2019 4,309,766 Acquisition of ANC Smith's 2,185,748 Acquisition of ANC Potter's 1,417,609 Balance at December 31, 2020 $ 7,913,123 |
Schedule of intangible assets | Weighted average December 31, 2020 amortization period (in years) Gross Accumulated Amortization Net Tradenames $ 932,000 $ (125,708) $ 806,292 Customer relationships 3,289,000 (611,709) 2,677,291 Non-compete agreements 564,000 (79,893) 484,107 $ 4,785,000 $ (817,310) $ 3,967,690 Weighted average December 31, 2019 amortization period (in years) 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 |
Schedule of estimated aggregate amortization expense | 2021 797,920 2022 797,920 2023 797,920 2024 781,670 2025 535,087 Thereafter 257,173 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases | |
Schedule of lease expenses | Lease expenses during the year ended December 31, 2020 and the period October 4, 2019 through December 31, 2019 is as follows: Successor Year Ended October 4, 2019 December 31, through 2020 December 31, 2019 Operating leases Operating lease cost $ 89,500 $ 12,750 Operating lease expense 89,500 12,750 Short-term lease rent expense 78,574 18,418 Total rent expense $ 168,074 $ 31,168 |
Schedule of maturity of operating leases | Successor Year Ended October 4, 2019 December 31, through 2020 December 31, 2019 Operating leases Operating cash flows from operating leases $ 89,500 $ 12,750 The maturity of the Company's operating leases are as follows: 2021 $ 2022 2023 2024 2025 — Thereafter — Total Less: Interest Present value of lease liabilities $ |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounts Payable and Accrued Liabilities (Successor) | |
Schedule of accounts payable and accrued liabilities (successor) | December 31, 2020 2019 Accounts payable $ 317,038 $ 138,712 Accrued professional fees 197,597 235,124 Accrued franchise tax 77,600 200,000 Accrued payroll 26,423 13,748 Due to noncontrolling interest — Accounts payable and accrued liabilities $ $ 587,584 |
Notes Payable (Successor) (Tabl
Notes Payable (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes Payable (Successor) | |
Schedule of Notes Payable | December 31, 2020 2019 Equipment notes $ 761,075 $ — PPP loans 378,346 — 1,139,421 — Less: current portion of Notes Payable (385,963) — Notes payable, net of current portion $ 753,458 $ — |
Stockholders Equity (Tables)
Stockholders Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders Equity | |
Schedule of outstanding warrants | Outstanding as of December 31, 2020 Exercise Price Expiration Date Class W‑1 Warrant $ 12.50 September 25, 2028 Class W‑2 Warrant $ 15.00 September 25, 2028 |
Summary of warrant activity | Weighted average remaining contractual life Warrants Weighted exercise price (in years) Outstanding as of October 4, 2019 3,150,000 $ 13.75 9.0 Forfeited 13.75 — Outstanding as of December 31, 2019 $ 13.75 8.7 Forfeited — — — Outstanding as of December 31, 2020 $ 13.75 7.7 Exercisable — $ — |
Share-based Compensation (Suc_2
Share-based Compensation (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Compensation (Successor) | |
Schedule of unvested restricted stock units | Weighted average grant- Units date fair value Unvested as of October 4, 2019 — $ — Granted Unvested as of December 31, 2019 $ Granted Forfeited $ Vested Unvested as of December 31, 2020 $ Total unrecognized expense remaining $ Weighted average years expected to be recognized over |
Income (Loss) Per Common Shar_2
Income (Loss) Per Common Share (Successor) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income (Loss) Per Common Share (Successor) | |
Summary calculations of basic and diluted income (loss) per common share | Year Ended October 4, 2019 December 31, through 2020 December 31, 2019 Numerator: Net loss attributable to common shareholders $ (3,225,275) $ (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 $ (1.62) $ (0.70) Net loss per shares attributable to Class A and Class B Common shareholders- Diluted $ (1.62) $ (0.70) |
Summary of potentially dilutive securities excluded from computation of diluted weighted average shares outstanding | December 31, 2020 2019 Unvested Restricted Stock Units 105,008 150,000 Unvested Restricted Stock — 10,000 Warrants 2,250,000 2,250,000 2,355,008 2,410,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Provision for (benefit from) income taxes | For the Year Ended October 4, 2019 December 30, through 2020 December 31, 2019 Statutory federal income tax rate 21.0 % % State income taxes, net of federal taxes 3.6 % % Non-controlling interest 0.0 % % Other permanent items (0.2) % % Change in valuation allowance (24.4) % % Income taxes provision (benefit) 0.0 % 0.0 % |
Net deferred tax assets | December 31, 2020 2019 Deferred tax assets: Net operating loss carryforwards 1,334,445 663,177 Stock-based compensation 141,914 65,597 Amortization 973 — Passthrough entity 178,676 — Other 45 — Total deferred income tax assets 1,656,053 728,774 Deferred tax liabilities: Depreciation — — — — Valuation allowance (1,656,053) (728,774) Deferred tax asset, net of allowance — — |
Nature of the Business (Details
Nature of the Business (Details) - USD ($) $ in Thousands | Feb. 28, 2020 | Feb. 03, 2020 | Oct. 04, 2019 |
ANC Green Solutions I | |||
Business Acquisition [Line Items] | |||
Percentage voting interest acquired | 60.00% | ||
Consideration transferred | $ 4,000 | ||
ANC Potter's [Member] | |||
Business Acquisition [Line Items] | |||
Percentage voting interest acquired | 60.00% | ||
Consideration transferred | $ 1,680 | ||
ANC Green Solutions Smith purchase agreement | |||
Business Acquisition [Line Items] | |||
Percentage voting interest acquired | 60.00% | ||
Consideration transferred | $ 3,000 | ||
ANC Green Solutions Smith purchase agreement | ANC Smith | |||
Business Acquisition [Line Items] | |||
Percentage voting interest acquired | 40.00% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Accounts Receivable (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Summary of Significant Accounting Policies | ||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | |
Allowance for doubtful accounts, beginning of period | $ 0 | $ 34,976 | $ 0 | $ 34,976 | $ 2,467 | |
Bad debt expense | 2,467 | 24,695 | ||||
Allowance for doubtful accounts, end of period | $ 2,467 | $ 2,467 | $ 34,976 | $ 27,162 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 15 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 5 years | 5 years |
Minimum | Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 5 years | |
Minimum | Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 5 years | |
Minimum | Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 5 years | |
Maximum | Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 10 years | |
Maximum | Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 7 years | |
Maximum | Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment Useful Lives (in years) | 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, 2020USD ($)segment | |
Segment Information | |||
Number of reportable segments | segment | 1 | ||
Retirement Plans | |||
Employer contribution | $ 6,000 | $ 5,000 | $ 27,000 |
Maximum | |||
Retirement Plans | |||
Employer contribution | 19,500 | ||
Employees 50 years or over | Maximum | |||
Retirement Plans | |||
Employer contribution | $ 26,000 |
Revenue (Details)
Revenue (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | |
Total revenue | $ 683,265 | $ 1,957,025 | $ 7,702,866 | |||
Lawn and tree care service revenue | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total revenue | 665,323 | 1,880,694 | 7,620,131 | |||
Franchise revenue | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total revenue | $ 17,942 | $ 76,331 | $ 82,735 |
Business Combination (Success_3
Business Combination (Successor) - Purchase Price (Details) - USD ($) | Dec. 31, 2020 | Feb. 28, 2020 | Feb. 03, 2020 | Dec. 31, 2019 | Oct. 04, 2019 |
Preliminary allocation of purchase price | |||||
Goodwill | $ 7,913,123 | $ 4,309,766 | |||
ANC Green Solutions I | |||||
Preliminary allocation of purchase price | |||||
Accounts receivable and other current assets | $ 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 | (2,667,000) | ||||
Cash purchase price, net of cash acquired | $ 3,432,000 | ||||
ANC Green Solutions Potter's Purchase Agreement | |||||
Preliminary allocation of purchase price | |||||
Accounts receivable and other current assets | $ 107,000 | ||||
Property and equipment | 234,000 | ||||
Right-of-use asset | 113,000 | ||||
Intangible assets | 1,285,000 | ||||
Goodwill | 1,418,000 | ||||
Accounts payable and accrued expenses | (84,000) | ||||
Lease liability | (113,000) | ||||
Notes payable | (139,000) | ||||
Deferred cash consideration | (147,000) | ||||
Non-controlling interest in ANC | (1,145,000) | ||||
Cash purchase price, net of cash acquired | $ 1,529,000 | ||||
ANC Green Solutions Smith purchase agreement | |||||
Preliminary allocation of purchase price | |||||
Accounts receivable and other current assets | $ 167,000 | ||||
Property and equipment | 1,117,000 | ||||
Intangible assets | 1,537,000 | ||||
Goodwill | 2,186,000 | ||||
Accounts payable and accrued expenses | (80,000) | ||||
Deferred cash consideration | (1,276,000) | ||||
Non-controlling interest in ANC | (2,000,000) | ||||
Cash purchase price, net of cash acquired | $ 1,651,000 |
Business Combination (Success_4
Business Combination (Successor) - Unaudited Proforma Financial Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
ANC Green Solutions I | ||
Business Acquisition [Line Items] | ||
Total revenue | $ 2,640,290 | |
Net loss | (2,003,167) | |
ANC Green Solutions Potter's Purchase Agreement | ||
Business Acquisition [Line Items] | ||
Total revenue | $ 7,895,195 | 4,819,389 |
Net loss | (3,033,509) | (340,758) |
ANC Green Solutions Smith purchase agreement | ||
Business Acquisition [Line Items] | ||
Total revenue | 8,170,261 | 6,248,542 |
Net loss | $ (3,040,376) | $ (155,570) |
Business Combination (Success_5
Business Combination (Successor) - Additional information (Details) - USD ($) | Dec. 31, 2020 | Feb. 28, 2020 | Feb. 03, 2020 | Oct. 04, 2019 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||||||||
Amortization of intangible assets | $ 100,000 | $ 700,000 | |||||||
ANC Green Solutions I | |||||||||
Business Acquisition [Line Items] | |||||||||
Percentage voting interest acquired | 60.00% | ||||||||
Aggregate purchase price | $ 4,000,000 | ||||||||
Amount paid at closing | 3,500,000 | ||||||||
Deferred consideration to be paid | $ 500,000 | ||||||||
Transaction cost related to acquisition | $ 65,000 | $ 100,000 | |||||||
Amortization of intangible assets | 300,000 | ||||||||
ANC Green Solutions Potter's Purchase Agreement | |||||||||
Business Acquisition [Line Items] | |||||||||
Percentage voting interest acquired | 60.00% | ||||||||
Aggregate purchase price | $ 1,680,000 | ||||||||
Amount paid at closing | 1,500,000 | ||||||||
Deferred consideration to be paid | $ 147,000 | ||||||||
Transaction cost related to acquisition | 100,000 | ||||||||
Amortization of intangible assets | 16,000 | 200,000 | |||||||
Revenue since acquisition | $ 1,800,000 | ||||||||
Loss from operations since acquisition | $ 200,000 | ||||||||
ANC Green Solutions Smith purchase agreement | |||||||||
Business Acquisition [Line Items] | |||||||||
Percentage voting interest acquired | 60.00% | ||||||||
Aggregate purchase price | $ 3,000,000 | ||||||||
Amount paid at closing | 2,600,000 | ||||||||
Deferred consideration to be paid | $ 400,000 | ||||||||
Working Capital Adjustment in deferred consideration | $ 900,000 | ||||||||
Transaction cost related to acquisition | 100,000 | ||||||||
Amortization of intangible assets | $ 300,000 | $ 50,000 | $ 300,000 | ||||||
Revenue since acquisition | $ 3,300,000 |
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, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 265,045 | $ 2,583,804 | |
Less : Accumulated depreciation | (19,092) | (435,886) | |
Property and equipment, net | 245,953 | 2,147,918 | |
Depreciation expense | 20,000 | $ 60,000 | 400,000 |
Vehicles | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 101,410 | 469,399 | |
Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 119,276 | 1,815,095 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 174,585 | ||
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 51,947 | ||
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 42,163 | 66,886 | |
Office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 2,196 | $ 5,892 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Successor) (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | ||
Beginning Balance | $ 4,309,766 | |
Ending Balance | $ 4,309,766 | 7,913,123 |
ANC Green Solutions I | ||
Goodwill [Roll Forward] | ||
Acquisition | $ 4,309,766 | |
ANC Green Solutions Smith purchase agreement | ||
Goodwill [Roll Forward] | ||
Acquisition | 2,185,748 | |
ANC Green Solutions Potter's Purchase Agreement | ||
Goodwill [Roll Forward] | ||
Acquisition | $ 1,417,609 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Successor) - Intangible assets (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | $ 1,963,000 | $ 4,785,000 | $ 1,963,000 |
Accumulated Amortization | (81,792) | (817,310) | (81,792) |
Net | 1,881,208 | 3,967,690 | 1,881,208 |
Amortization expense | 100,000 | 700,000 | |
Tradenames | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 251,000 | 932,000 | 251,000 |
Accumulated Amortization | (10,458) | (125,708) | (10,458) |
Net | 240,542 | $ 806,292 | $ 240,542 |
Weighted average amortization period | 7 years 6 months | 6 years | |
Customer relationships | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 1,712,000 | $ 3,289,000 | $ 1,712,000 |
Accumulated Amortization | (71,334) | (611,709) | (71,334) |
Net | $ 1,640,666 | $ 2,677,291 | $ 1,640,666 |
Weighted average amortization period | 5 years 8 months 12 days | 6 years | |
Non-compete agreements | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | $ 564,000 | ||
Accumulated Amortization | (79,893) | ||
Net | $ 484,107 | ||
Weighted average amortization period | 6 years 7 months 6 days |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Successor) - Amortization expense (Details) | Dec. 31, 2020USD ($) |
Goodwill and Intangible Assets (Successor) | |
2021 | $ 797,920 |
2022 | 797,920 |
2023 | 797,920 |
2024 | 781,670 |
2025 | 535,087 |
Thereafter | $ 257,173 |
Leases - Lease Expenses (Detail
Leases - Lease Expenses (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Leases | ||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | |
Operating lease liabilities | $ 200,000 | $ 200,000 | $ 258,523 | |||
Right of use assets | $ 220,294 | 220,294 | 258,523 | |||
Lease Expenses | ||||||
Operating lease cost | 12,750 | 89,500 | ||||
Short-term lease rent expense | 18,418 | 78,574 | ||||
Total rent expense | $ 31,168 | $ 168,074 | ||||
Weighted average remaining lease term | 2 years 11 months 5 days | |||||
Weighted average discount rate | 5.00% |
Leases - Supplemental cash flow
Leases - Supplemental cash flow information (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Operating leases | ||||||
Operating cash flows from operating leases | $ 12,750 | $ 89,500 | ||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor |
Leases - Lease Maturity (Detail
Leases - Lease Maturity (Details) - USD ($) | 9 Months Ended | ||
Oct. 03, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Maturity of operating leases | |||
2021 | $ 93,000 | ||
2022 | 93,000 | ||
2023 | 54,500 | ||
2024 | 38,250 | ||
Total | 278,750 | ||
Less: Interest | (20,227) | ||
Present value of lease liabilities | $ 258,523 | $ 200,000 | |
Rent expense | $ 40,000 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities (Successor) (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Accounts Payable and Accrued Liabilities (Successor) | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor |
Accounts payable | $ 138,712 | $ 317,038 | |||
Accrued professional fees | 235,124 | 197,597 | |||
Accrued franchise tax | 200,000 | 77,600 | |||
Accrued payroll | 13,748 | 26,423 | |||
Due to noncontrolling interest | 66,706 | ||||
Accounts payable and accrued liabilities | $ 587,584 | $ 685,364 |
Notes Payable (Successor) - Add
Notes Payable (Successor) - Additional information (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |
Nov. 30, 2020 | Apr. 30, 2020 | Oct. 03, 2019 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||||
Outstanding notes payable | $ 1,139,421 | |||
Loan remaining term | 2 years | |||
Repayment of principal | $ 20,473 | 60,445 | ||
Forgiveness of notes payable | $ 191,400 | |||
Other Income | ||||
Debt Instrument [Line Items] | ||||
Forgiveness of notes payable | $ 200,000 | |||
PPP loans | ||||
Debt Instrument [Line Items] | ||||
Annual interest rate | 1.00% | |||
Fixed Rate | 1.0% | |||
Equipment notes | ||||
Debt Instrument [Line Items] | ||||
Outstanding notes payable | $ 700,000 | |||
Annual interest rate | 4.50% | |||
Aggregate principal amount | $ 60,000 | |||
Fixed Rate | 2.85% | |||
Equipment notes | Minimum | ||||
Debt Instrument [Line Items] | ||||
Loan remaining term | 1 year | |||
Equipment notes | Maximum | ||||
Debt Instrument [Line Items] | ||||
Loan remaining term | 4 years |
Notes Payable (Successor) - (De
Notes Payable (Successor) - (Details) | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | |
Notes Payable | $ 1,139,421 |
Less: current portion of Notes Payable | (385,963) |
Notes payable, net of current portion | 753,458 |
Equipment notes | |
Debt Instrument [Line Items] | |
Notes Payable | 761,075 |
PPP loans | |
Debt Instrument [Line Items] | |
Notes Payable | $ 378,346 |
Stockholders Equity - Warrants
Stockholders Equity - Warrants (Details) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 | Oct. 03, 2019 |
Warrants | |||
Warrant outstanding | 2,250,000 | 3,150,000 | |
Exercise Price | $ 13.75 | $ 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 - Additiona
Stockholders Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Class of Stock [Line Items] | |||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, shares issued | 0 | 0 | |
Preferred stock, shares outstanding | 0 | 0 | |
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 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, shares issued | 0 | 0 | |
Preferred stock, shares outstanding | 0 | 0 | |
Common Stock | |||
Class of Stock [Line Items] | |||
Common stock, shares authorized | 67,500,000 | ||
Common stock, par value | $ 0.001 | ||
Class A Common stock | |||
Class of Stock [Line Items] | |||
Common stock, shares authorized | 60,000,000 | 60,000,000 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Number of votes | 1 | ||
Common Stock, shares issued | 2,416,866 | 1,683,691 | |
Common Stock, shares outstanding | 2,416,866 | 1,683,691 | |
Class B Common stock | |||
Class of Stock [Line Items] | |||
Common stock, shares authorized | 7,500,000 | 7,500,000 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Number of votes | 50 | ||
Common Stock, shares issued | 81,198 | 81,198 | |
Common Stock, shares outstanding | 81,198 | 81,198 | |
Private Placement | Class A Common stock | |||
Class of Stock [Line Items] | |||
Issuance of Class A Common Stock in private placement, net of issuance costs (in shares) | 673,751 | 182,335 | |
Share price | $ 11 | $ 11 | |
Gross proceeds | $ 7.4 | $ 2 | |
Net proceeds | $ 7.1 | ||
Peter Cohen | Class A Common stock | |||
Class of Stock [Line Items] | |||
Shares issued on conversion | 40,599 | ||
Peter Cohen | Class B Common stock | |||
Class of Stock [Line Items] | |||
Shares converted | 40,599 |
Stockholders Equity - Schedule
Stockholders Equity - Schedule of warrants (Details) - $ / shares | Oct. 03, 2019 | Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 |
Stockholders Equity | |||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | ||
Beginning balance | 3,150,000 | 3,150,000 | 2,250,000 | ||||
Forfeited | (900,000) | ||||||
Ending balance | 3,150,000 | 2,250,000 | 2,250,000 | 3,150,000 | |||
Weighted exercise price, beginning balance | $ 13.75 | $ 13.75 | $ 13.75 | ||||
Weighted exercise price, Forfeited | 13.75 | ||||||
Weighted exercise price, Ending balance | $ 13.75 | $ 13.75 | $ 13.75 | $ 13.75 | $ 13.75 | ||
Weighted average remaining contractual life of warrants | 9 years | 8 years 8 months 12 days | 7 years 8 months 12 days |
Share-based Compensation (Suc_3
Share-based Compensation (Successor) (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Unit | ||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | |
Forfeited | (900,000) | |||||
Ending balance | 2,250,000 | |||||
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 | ||||||
Beginning balance | 150,000 | |||||
Granted | 150,000 | 18,182 | ||||
Forfeited | (13,750) | |||||
Vested | (49,424) | |||||
Ending balance | 150,000 | 150,000 | 105,008 | |||
Total unrecognized expense remaining | $ 551,000 | |||||
Weighted average years expected to be recognized over | 1 year 1 month 6 days | |||||
Weighted average grant-date fair value | ||||||
Weighted average grant-date fair value, Ending balance | $ 11 | |||||
Weighted average grant-date fair value, Granted | $ 11 | 11 | ||||
Forfeited (in dollars per share) | 11 | |||||
Vested (in dollars per share) | 11 | |||||
Weighted average grant-date fair value, Beginning balance | $ 11 | $ 11 | $ 11 |
Share-based Compensation (Suc_4
Share-based Compensation (Successor)- Additional information (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unvested restricted shares | 2,250,000 | |
Total share-based compensation expense | $ 200,000 | $ 1,000,000 |
Fair value ,vested | $ 500,000 | |
2019 Equity Incentive Plans | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate shares of common stock were authorized | 1,084,132 | |
Common shares were available for future grants | 919,700 | |
Weighted average grant-date fair value | $ 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 | Restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant-date fair value | $ 10 | |
Unvested restricted shares | 10,000 | |
Total unrecognized expense remaining | $ 110,000 | |
2019 Equity Incentive Plans | Unvested Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average grant-date fair value | $ 11 | $ 11 |
Unvested restricted shares | 150,000 | 105,008 |
Total unrecognized expense remaining | $ 551,000 | |
Weighted average years expected to be recognized over | 1 year 1 month 6 days | |
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_3
Income (Loss) Per Common Share (Successor) - Basic and Diluted (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | |
Net loss attributable to common shareholders | $ (1,123,755) | $ 449,463 | $ (3,225,275) | |||
Weighted average common shares outstanding- Basic | 1,612,172 | 1,996,044 | ||||
Weighted average common shares outstanding- Diluted | 1,612,172 | 1,996,044 | ||||
Net loss per share attributable to Class A and Class B Common shareholders- Basic | $ (0.70) | $ (1.62) | ||||
Net loss per shares attributable to Class A and Class B Common shareholders- Diluted | $ (0.70) | $ (1.62) | ||||
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 | 1,914,846 | ||||
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 | 81,198 |
Income (Loss) Per Common Shar_4
Income (Loss) Per Common Share (Successor) - Anti Dilutive (Details) - shares | 1 Months Ended | 2 Months Ended | 9 Months Ended | 12 Months Ended | ||
Oct. 31, 2019 | Oct. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Successor | Predecessor | Successor | |
Potential equivalent shares excluded | 2,355,008 | 2,410,000 | ||||
Unvested Restricted Stock Units | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||
Potential equivalent shares excluded | 105,008 | 150,000 | ||||
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 | 2,250,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Jan. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Oct. 03, 2019 | Dec. 31, 2020 |
Lease expense | $ 31,168 | $ 168,074 | ||||
Operating Leases, Rent Expense | $ 40,000 | |||||
Proceeds from issuance | $ 2,005,662 | 7,169,779 | ||||
Shareholders distribution | 1,247,448 | |||||
ANC Green Solutions Potter's Purchase Agreement | Lease Transactions | ||||||
Lease expense | $ 38,500 | |||||
Lease term | 3 years | |||||
Class A Common stock | ||||||
Proceeds from issuance | $ 350,009 | |||||
Peter Cohen | Lease Transactions | ||||||
Lease cost per month | $ 6,000 | |||||
Lease expense | 18,400 | 79,000 | ||||
Peter Cohen | Class A Common stock | ||||||
Offering price | $ 11 | |||||
Shares issued | 22,728 | 22,728 | ||||
Proceeds from issuance | $ 250,000 | |||||
Jeffrey Piermont | Class A Common stock | ||||||
Shares issued | 9,091 | |||||
Non controlling Interest [Member] | Class A Common stock | ANC Green Solutions I | ||||||
Lease expense | $ 12,750 | $ 51,000 | ||||
Lease term | 5 years | |||||
Shareholder | ||||||
Shareholders distribution | 1,200,000 | |||||
Shareholder | Lease Transactions | ||||||
Lease expense | $ 43,000 | |||||
Milun K . Patel | Class A Common stock | ||||||
Offering price | $ 11 | |||||
Shares issued | 6,900 | |||||
Proceeds from issuance | $ 75,900 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 12 Months Ended |
Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2020 | |
Income Tax Disclosure [Line Items] | ||||
Effective tax rate | 0.00% | 0.00% | 21.00% | 21.00% |
Operating loss carryforwards | $ 2,800,000 | $ 2,800,000 | $ 5,600,000 | |
Unrecognized tax benefits | $ 0 | 0 | 0 | 0 |
Income tax related interest or penalties assessed or recorded | 0 | 0 | 0 | |
Income tax provision | $ 0 | 0 | 0 | |
Federal | ||||
Income Tax Disclosure [Line Items] | ||||
Operating loss carryforwards | 5,600,000 | 5,600,000 | 5,600,000 | |
State | ||||
Income Tax Disclosure [Line Items] | ||||
Operating loss carryforwards | $ 5,400,000 | $ 5,400,000 | $ 5,400,000 |
Income Taxes - Income tax provi
Income Taxes - Income tax provision (benefit) (Details) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 12 Months Ended |
Oct. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2020 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||||
Statutory federal income tax rate | 0.00% | 0.00% | 21.00% | 21.00% |
State income taxes, net of federal taxes | 3.50% | 3.60% | ||
Non-controlling interest | 1.40% | 0.00% | ||
Other permanent items | (0.50%) | (0.20%) | ||
Change in valuation allowance | (25.40%) | (24.40%) | ||
Income tax provision (benefit) | 0.00% | 0.00% |
Income Taxes - Net deferred tax
Income Taxes - Net deferred taxes assets (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets | ||
Net operating loss carryforwards | $ 1,334,445 | $ 663,177 |
Stock-based compensation | 141,914 | 65,597 |
Amortization | 973 | |
Passthrough entity | 178,676 | |
Other | 45 | |
Total deferred tax assets | 1,656,053 | 728,774 |
Less valuation allowance | (1,656,053) | (728,774) |
Deferred tax asset, net of allowance | $ 0 | $ 0 |
Subsequent Events (Successor) (
Subsequent Events (Successor) (Details) - USD ($) | Mar. 12, 2021 | Feb. 19, 2021 | Feb. 18, 2021 | Jan. 26, 2021 | Jan. 20, 2021 | Feb. 28, 2020 | Feb. 03, 2020 | Jan. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2020 |
Proceeds from the issuance shares in private placement, net of issuance costs | $ 2,005,662 | $ 7,169,779 | |||||||||
Class A Common stock | |||||||||||
Proceeds from the issuance shares in private placement, net of issuance costs | $ 350,009 | ||||||||||
Subsequent Event | Class A Common stock | Common Stock | |||||||||||
Issuance of Class A Common Stock | $ 1,020,616 | ||||||||||
Proceeds from the issuance shares in private placement, net of issuance costs | $ 11,200,000 | ||||||||||
ANC Green Solutions- Zodega | Subsequent Event | |||||||||||
Percentage of shares acquired | 51.00% | ||||||||||
Consideration in shares | 51,290 | ||||||||||
Consideration transferred | $ 600,000 | ||||||||||
ANC Green Solutions Smith purchase agreement | |||||||||||
Percentage of shares acquired | 60.00% | ||||||||||
Consideration transferred | $ 3,000,000 | ||||||||||
Payments to acquire business | $ 2,600,000 | ||||||||||
ANC Green Solutions Smith purchase agreement | ANC Smith | |||||||||||
Percentage of shares acquired | 40.00% | ||||||||||
ANC Green Solutions Potter's Purchase Agreement | |||||||||||
Percentage of shares acquired | 60.00% | ||||||||||
Consideration transferred | $ 1,680,000 | ||||||||||
Payments to acquire business | $ 1,500,000 | ||||||||||
ANC Zodega Purchase agreement | ANC Green Solutions- Zodega | Subsequent Event | |||||||||||
Percentage of shares acquired | 49.00% | ||||||||||
Texas Seasons Corporation | ANC Green Solutions- Zodega | Subsequent Event | |||||||||||
Amount of capital call to fund the business acquisition | $ 900,000 | ||||||||||
Texas Seasons Corporation | ANC Green Solutions- Zodega | Subsequent Event | Litton Enterprises Inc. | |||||||||||
Total promissory notes | $ 500,000 | ||||||||||
Promissory notes percentage | 7.00% | ||||||||||
Greentex Landscaping Inc. | ANC Green Solutions- Zodega | Subsequent Event | |||||||||||
Amount of capital call to fund the business acquisition | $ 300,000 | ||||||||||
Greentex Landscaping Inc. | ANC Green Solutions- Zodega | Subsequent Event | Litton Enterprises Inc. | |||||||||||
Total promissory notes | $ 200,000 | ||||||||||
Promissory notes percentage | 7.00% | ||||||||||
C.J.'s Yardworks, Inc. | ANC Green Solutions- Zodega | Subsequent Event | |||||||||||
Amount of capital call to fund the business acquisition | $ 2,200,000 | ||||||||||
C.J.'s Yardworks, Inc. | ANC Green Solutions- Zodega | Subsequent Event | Litton Enterprises Inc. | |||||||||||
Total promissory notes | $ 1,100,000 | ||||||||||
Promissory notes percentage | 7.00% | ||||||||||
Lillard Lawn & Landscaping, Inc. | ANC Green Solutions- Zodega | Subsequent Event | |||||||||||
Amount of capital call to fund the business acquisition | $ 800,000 | ||||||||||
Lillard Lawn & Landscaping, Inc. | ANC Green Solutions- Zodega | Subsequent Event | Litton Enterprises Inc. | |||||||||||
Total promissory notes | $ 400,000 | ||||||||||
Promissory notes percentage | 7.00% |