Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 11, 2021 | |
Document Information Line Items | ||
Entity Registrant Name | SYSOREX, INC. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 144,088,212 | |
Amendment Flag | false | |
Entity Central Index Key | 0001737372 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Jun. 30, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Shell Company | false | |
Entity Ex Transition Period | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-55924 | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 68-0319458 | |
Entity Address, Address Line One | 13880 Dulles Corner Lane | |
Entity Address, Address Line Two | Suite 175 | |
Entity Address, City or Town | Herndon | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 20171 | |
Entity Interactive Data Current | Yes | |
City Area Code | 800 | |
Local Phone Number | 929-3871 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 99 | $ 67 |
Digital assets | 105 | 24 |
Accounts receivable, net | 491 | |
Related party receivables | 17 | |
Prepaid expenses and other current assets | 1,093 | |
Total Current Assets | 1,788 | 108 |
Mining equipment, net | 13,781 | 1,272 |
Intangible assets, net | 2,839 | |
Goodwill | 1,634 | |
Investment in Up North Hosting, LLC | 688 | 644 |
Other assets | 33 | |
Total Assets | 20,763 | 2,024 |
Current Liabilities | ||
Accounts payable | 6,986 | 7 |
Accrued liabilities | 1,517 | 117 |
Short-term debt, related parties | 2,226 | 75 |
Deferred revenue | 562 | |
Total Current Liabilities | 11,291 | 199 |
Other liabilities | 36 | |
Total Liabilities | 11,327 | 199 |
Commitments and Contingencies | ||
Stockholders’ Equity | ||
Common stock, par value $0.00001 per share, 500,000,000 shares authorized; 143,588,591 shares issued as of June 30, 2021, and 66,431,920 shares issued as of December 31, 2020, 143,513,212 shares outstanding as of June 30, 2021, and 66,431,920 shares outstanding as of December 31, 2020, respectively | 1 | |
Treasury stock, at cost, 75,379 shares as of June 30, 2021, and 0 shares as of December 31, 2020, respectively | ||
Subscription receivable | (100) | |
Additional paid-in-capital | 34,103 | 2,060 |
Accumulated Deficit | (24,668) | (135) |
Total Stockholders’ Equity | 9,436 | 1,825 |
Total Liabilities and Stockholders’ Equity | $ 20,763 | $ 2,024 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | Jun. 30, 2021 | Dec. 31, 2020 |
Statement of Cash Flows [Abstract] | ||
Common stock, par value (in Dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 143,588,591 | 66,431,920 |
Common stock, shares outstanding | 143,513,212 | 66,431,920 |
Treasury stock, shares | 75,379 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues | ||||
Mining income | $ 4,234 | $ 274 | $ 6,251 | $ 554 |
Product revenue | 1,599 | 1,599 | ||
Services revenue | 413 | 413 | ||
Total Revenues | 6,246 | 274 | 8,263 | 554 |
Operating costs and expenses | ||||
Mining cost | 344 | 104 | 475 | 215 |
Product cost | 1,391 | 1,391 | ||
Services cost | 242 | 242 | ||
Sales and marketing | 301 | 6 | 301 | 7 |
General and administrative | 4,307 | 4 | 4,364 | 4 |
Management Fees | 16 | 321 | 33 | |
Depreciation | 1,345 | 198 | 1,545 | 406 |
Amortization of intangibles | 121 | 121 | ||
Total Operating Costs and Expenses | 8,051 | 328 | 8,760 | 665 |
Loss from Operations | (1,805) | (54) | (497) | (111) |
Other Income (Expenses) | ||||
Merger charges | (22,004) | (22,004) | ||
Debt Restructuring fee | (2,000) | (2,000) | ||
Interest expense | (29) | (29) | ||
Realized gain on sale of digital assets | 1 | 8 | 88 | 14 |
Gain/(loss) on disposal of assets | 11 | (7) | 14 | |
Other expense, net | (25) | (28) | ||
Total Other Income (Expense) | (24,057) | 19 | (23,980) | 28 |
Loss before Income taxes and loss in equity method investee | (25,862) | (35) | (24,477) | (83) |
Income tax benefit | 179 | |||
Loss before Income in equity method investee | (25,683) | (35) | (24,477) | (83) |
Share of net loss of equity method investee | (60) | (3) | (56) | |
Net Loss | $ (25,743) | $ (38) | $ (24,533) | $ (83) |
Net Loss per share - basic and diluted (in Dollars per share) | $ (0.168) | $ (0.001) | $ (0.208) | $ (0.001) |
Weighted Average Shares Outstanding - basic and diluted (in Shares) | 153,096,881 | 69,720,300 | 118,068,397 | 69,720,300 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) - USD ($) $ in Thousands | Common Stock | Treasury Stock | Additional Paid-In Capital | Subscription Receivables | Accumulated Deficit | Total |
Balance at Dec. 31, 2019 | $ 2,671 | $ (100) | $ (587) | $ 1,984 | ||
Balance (in Shares) at Dec. 31, 2019 | 55,776,240 | |||||
Distributions to shareholders | (152) | (152) | ||||
Net Income (Loss) | (45) | (45) | ||||
Balance at Mar. 31, 2020 | 2,519 | (100) | (632) | 1,787 | ||
Balance (in Shares) at Mar. 31, 2020 | 55,776,240 | |||||
Distributions to shareholders | (149) | (149) | ||||
Net Income (Loss) | (38) | (38) | ||||
Balance at Jun. 30, 2020 | 2,370 | (100) | (670) | 1,600 | ||
Balance (in Shares) at Jun. 30, 2020 | 55,776,240 | |||||
Balance at Dec. 31, 2020 | 2,060 | (100) | (135) | 1,825 | ||
Balance (in Shares) at Dec. 31, 2020 | 66,431,920 | |||||
Distributions to shareholders | (1,521) | (1,521) | ||||
Payment of subscription receivable | 100 | 100 | ||||
Exercise of Moon Manager warrants | ||||||
Exercise of Moon Manager warrants (in Shares) | 14,607,980 | |||||
Net Income (Loss) | 1,210 | 1,210 | ||||
Balance at Mar. 31, 2021 | 539 | 1,075 | 1,614 | |||
Balance (in Shares) at Mar. 31, 2021 | 81,039,900 | |||||
Net Income (Loss) | (25,743) | (25,743) | ||||
Mining equipment | 12,000 | 12,000 | ||||
Mining equipment (in Shares) | 35,588,548 | |||||
Sysorex recapitalization | 19,401 | 19,401 | ||||
Sysorex recapitalization (in Shares) | 25,985,633 | |||||
TTM digital/Sysorex merger | $ 1 | 280 | 281 | |||
TTM digital/Sysorex merger (in Shares) | 494,311 | 75,379 | ||||
Professional services | 1,883 | 1,883 | ||||
Professional services (in Shares) | 404,820 | |||||
Balance at Jun. 30, 2021 | $ 1 | $ 34,103 | $ (24,668) | $ 9,436 | ||
Balance (in Shares) at Jun. 30, 2021 | 143,513,212 | 75,379 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Cash Flows from Operating Activities | ||
Net loss | $ (24,533) | $ (83) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 1,666 | 406 |
(Gain)/ loss on sale of mining equipment | 7 | (14) |
Realized gain on sale of digital assets | (88) | (14) |
Equity in earnings of equity method investment | 56 | (1) |
Change in fair value of accrued issuable equity | 27 | |
Issuance of shares in exchange for services | 1,883 | |
Merger Charges | 22,004 | |
Debt Restructuring expense | 2,000 | |
Changes in assets and liabilities: | ||
Digital assets | (5,864) | (519) |
Related party receivable | 17 | (14) |
Prepaid assets and other current assets | 167 | |
Accounts receivables and other current assets | 4,182 | (3) |
Accounts payable | (2,938) | 3 |
Accrued liabilities | 285 | (56) |
Net cash used in operating activities | (1,129) | (295) |
Cash Flows from Investing Activities | ||
Proceeds from sale of digital assets | 3,331 | 231 |
Reverse acquisition of Sysorex business | 28 | |
Purchase of mining equipment | (50) | (18) |
Proceeds from sale of mining equipment | 47 | 79 |
Distributions received from Up North Hosting | 12 | |
Investments in Up North | (100) | 5 |
Net cash provided by investing activities | 3,256 | 309 |
Cash Flows from Financing Activities | ||
Repayment of loans | (2,195) | (30) |
Payment of subscription receivable | 100 | |
Net cash used in financing activities | (2,095) | (30) |
Net increase (decrease) in cash and cash equivalents | 32 | (16) |
Cash and cash equivalents at beginning of period | 67 | 34 |
Cash and cash equivalents at end of period | 99 | 18 |
Cash paid for: | ||
Interest | 126 | |
Income taxes | ||
Supplemental disclosure of noncash investing and financing activities: | ||
Sysorex recapitalization | 19,401 | |
Payments of short-term borrowing with digital assets | 1,019 | |
Distribution of digital assets to stockholders’ | 1,521 | 301 |
Equipment acquired in exchange for equity | 12,000 | |
Equipment acquired through lease purchase arrangement | 2,130 | |
Settlement of loan with mining equipment | $ 75 |
Nature and Description of Busin
Nature and Description of Business | 6 Months Ended |
Jun. 30, 2021 | |
Description of Business, the Spin-Off and Going Concern and Management's Plans [Abstract] | |
Nature and description of Business | Note 1 — Nature and description of Business Description of Business Sysorex, Inc. is a digital asset technology company primarily focused on Ethereum mining and the Ethereum blockchain. The Company has two wholly owned subsidiaries: TTM Digital Assets& Technologies, Inc. (“TTM Digital”) and Sysorex Government Services, Inc. (“SGS”). Following the Company’s Merger with TTM Digital, the Company shifted its primary business focus to the mining of Ethereum and opportunities related to the Ethereum blockchain. In addition to the mining of Ethereum, the Company continues to operate its wholly owned subsidiary, SGS, a business that provides information technology products, solutions, and services to federal, state, and local government, including system integrators. In the future, the Company plans to explore potential strategies to leverage the Ethereum blockchain and distributed ledger technology to SGS’s business opportunities. The Company is headquartered in Virginia. |
Going Concern
Going Concern | 6 Months Ended |
Jun. 30, 2021 | |
Going Concern [Abstract] | |
Going Concern | Note 2 — Going Concern As of June 30, 2021, the Company had an approximate cash balance of $0.1 million, working capital deficit of approximately $9.5 million, and an accumulated deficit of approximately $24.7 million. The aforementioned factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern within one year after the date the condensed consolidated financial statements are issued. Funding our operations on a go-forward basis will rely significantly on the Company’s ability to continue to mine cryptocurrency and the spot or market price of the cryptocurrency mined. The Company expects to generate ongoing revenues from the mining of cryptocurrencies, primarily Ethereum currency rewards, in its mining facilities. The Company’s ability to liquidate Ethereum currency rewards if needed at future values will be evaluated from time to time to generate cash for operations. Generating Ethereum currency rewards which exceed our production and overhead costs will determine the Company’s ability to report profit margins related to such mining operations. If the Company is unable to generate sufficient revenue from Ethereum mining when needed or secure additional sources of funding, it may be necessary to significantly reduce the current rate of spending or explore other strategic alternatives. |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 3 — Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with GAAP for interim financial information, which are the accounting principles that are generally accepted in the United States of America. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of the Company’s operations for the three and six-month periods ended June 30, 2021, is not necessarily indicative of the results to be expected for the year ending December 31, 2021. These interim unaudited condensed consolidated financial statements should be read in conjunction with the Company’s 8-K/A filed with the SEC on June 24, 2021. TTM Digital Reverse Merger and Sysorex Recapitalization On April 8, 2021, the Company, TTM Digital, and TTM Acquisition Corp., a Nevada corporation, a wholly owned subsidiary of Sysorex (“MergerSub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). Under the terms of the Merger Agreement, the parties agreed that Sysorex would acquire TTM Digital by way of a reverse triangular merger, subject to certain closing conditions (the “Merger”). On April 14, 2021 (the “Effective Time”), the closing conditions delineated in the Merger Agreement were satisfied and the Merger closed. At the Effective Time, the MergerSub was merged with and into TTM Digital with TTM Digital surviving the Merger. Under the terms of the Merger Agreement, the shareholders of TTM Digital received a right to receive an aggregate of 124,218,268 shares of Sysorex common stock, $0.00001 par value per share (the “Merger Shares”) in exchange for their shares of TTM Digital. Simultaneously, upon the issuance of the Merger Shares to the TTM Digital shareholders, Sysorex was issued all of the authorized capital of TTM Digital and TTM Digital became a wholly owned subsidiary of Sysorex (together the “Combined Company”). The Merger resulted in a change of control, with the shareholders of TTM Digital receiving that number of Merger Shares equal to approximately eighty percent (80%) of the outstanding shares of capital stock of Sysorex including the effect of the Sysorex Recapitalization as discussed in TTM Digital Reverse Merger and Sysorex Recapitalization. Due to the TTM Digital shareholders acquiring a controlling interest in Sysorex after the merger, the transaction was accounted for as a reverse acquisition for accounting purposes, with TTM Digital being the accounting acquirer and reporting entity. Therefore, the historical amounts presented prior to the Merger are those of TTM Digital. The Merger is accounted for under the acquisition method of accounting applied to Sysorex as the accounting acquiree under the guidance of ASC 805 Business Combinations (“ASC 805”). In accordance with acquisition method guidance under ASC 805, the purchase consideration was $0.3 million. As discussed in Note 4 Segment Reporting after the completion of the Merger the Company reports two segments (“TTM Digital” and “Sysorex Government Services”) which are also defined as reporting units for impairment assessment purposes. The Company is in the process of finalizing the purchase allocation, thus the provisional measures of deferred income taxes, intangibles, and goodwill are subject to change. The Company expects the purchase price allocation to be finalized in 2021. In the purchase price allocation of the fair value of assets acquired and liabilities assumed, the Company has recognized an excess of net liabilities assumed over the determined fair value of the Sysorex Government Services Reporting Unit. The excess of the purchase price over the net liabilities assumed was allocated to goodwill in the amount of $1.6 million based upon the underlying value of the Sysorex Government Services Reporting Unit with any additional excess dete rmined to be a separate transaction from the business combination attributable to acquisition-related costs for the benefit of the TTM Digital shareholders in achieving liquidity for their shares as publicly traded instruments. These costs were determined to not have future economic benefits or synergies to the Combined Company operations and were expensed as of the Effective Time under the caption “Merger Charges” in the accompanying Condensed consolidated statement of operations. Subsequent to the Merger Agreement the majority of the Sysorex debt, certain liabilities classified as current and a forward consulting contract with a former member Sysorex board of director’s (the “Debt Items”) aggregating $19.4 million were converted to 34,097,255 Sysorex shares when fully issued (the “Sysorex Recapitalization”). 25,985,633 shares were immediately issued, a prefunded warrant was issued for 5,111,622 shares and the right to receive 3,000,000 shares of Sysorex stock at a future date at the option of the holder subject to certain events. As a result of the Debt Items not having original contractual conversion features the holders of the Debt Items are not classified as owners of Sysorex in the Merger and the Sysorex Recapitalization is accounted for as a separate transaction occurring immediately following the Merger under the guidance of ASC 805. Under the Exchange Agreement executed with each debt holder, the Debt Items were converted at a contractual conversion rate of $0.569 per share (the “Conversion Price”). As a part of the Sysorex Recapitalization, the Company recognized $2.0 million in debt restructuring fees expense and a prepaid consulting contract of $0.7 million in the condensed consolidated statement of operations and balance sheet for the period ended June 30, 2021, respectively. The following table presents the fair value of the identified assets acquired and liabilities assumed at the Merger date, the effect of the Sysorex Recapitalization on the assets acquired and liabilities assumed, and the net assets acquired and liabilities assumed for the aggregate of the reverse acquisition and Merger Charges and Sysorex Recapitalization separate transactions: (In thousands of dollars) Reverse Sysorex Aggregate Fair Cash $ 28 $ - $ 28 Accounts receivable 4,673 - 4,673 Prepaid assets and other current assets 2,551 (1,289 ) 1,262 Property and equipment 7 - 7 Goodwill 1,634 - 1,634 Customer Relationships Intangible 1,900 - 1,900 Tradename Intangible 1,060 - 1,060 Other assets 29 - 29 Accounts payable (10,437 ) 519 (9,918 ) Accrued liabilities (2,722 ) 1,589 (1,133 ) Deferred revenue (590 ) - (590 ) Short term debt (7,136 ) 3,871 (3,265 ) Long term debt (12,711 ) 12,711 - Other liabilities (9 ) - (9 ) Fair value allocated to net assets / (liabilities) $ (21,723 ) $ 17,401 $ (4,322 ) Fair value of consideration and recapitalization equity $ 281 $ 19,401 $ 19,682 Merger charges (22,004 ) - (22,004 ) Debt restructuring fees - (2,000 ) (2,000 ) Net Sysorex equity and charges to income (loss) $ (21,723 ) $ 17,401 $ (4,322 ) For the three and six months ended June 30, 2021, the Company incurred approximately $3.1 million of acquisition related costs that are included in general and administrative expenses in the accompanying condensed consolidated statement of operations. From the acquisition date to June 30, 2021, revenues and operating loss for the accounting acquiree Sysorex were approximately$2.0 million and $0.5 million (excluding the acquisition related costs, merger charges and debt restructuring fees described above), respectively. See Note 5- Segment Reporting. Pro Forma Financial Information The following unaudited proforma results of operations are presented for information purposes only. The unaudited proforma results of operations are not intended to present actual results that would have been attained had the reverse merger and Sysorex Recapitalization been completed as of January 1, 2020, or to project potential operating results as of any future date or for any future periods. The revenue and net loss of the reverse merger accounting acquiree for the three and six months ended June 30, 2021, included in the consolidated statement of operations amounted to approximately $2.0 million and $0.9 million, respectively: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Total Revenues $ 10,513 $ 2,604 $ 13,937 $ 5,150 Net Income (Loss) 406 (943 ) 535 (1,905 ) Net Income (Loss) per share - basic and diluted 0.003 (0.014 ) 0.005 (0.027 ) Weighted Average Shares Outstanding - basic and diluted 153,096,881 69,720,300 118,068,397 69,720,300 Supplemental Pro forma Information (a) Merger charges 22,004 - 22,004 - Restructuring fee 2,000 - 2,000 - Transaction costs - Accounting acquirer and acquiree 3,093 - 3,093 - Total Nonrecurring Pro forma Adjustments 27,097 - 27,097 - (a) Supplemental Pro forma Information consists of material, nonrecurring pro forma adjustments directly attributable to the reverse acquisition and Sysorex Recapitalization Impact of COVID-19 COVID-19 continues to impact businesses and the federal and local government – the workforce in general. With the continued spread of COVID-19 variants, such as the Delta variant, restrictions are slowly coming back into the workforce and new mandates are being contemplated. Many labor intensive or services companies are lacking the workforce required to perform their operations. This continues to cause delays for our customers due to lack of resources to manufacture products, integrate systems, perform maintenance and make deliveries. This is coupled with the fact that many federal and local government locations continue to keep receiving docks closed, denied access to facilities for site surveys, installations or maintenance. The Company is flexible with our workforce and allowing remote work and requiring vaccinations prior to return to the office. The Company continues to operate and adjust our expectations between our suppliers, service providers and our federal and local government customers. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 4 — Summary of Significant Accounting Policies Principles of Consolidation The condensed consolidated financial statements have been prepared using the accounting records of Sysorex, TTM and SGS. All material inter-company balances and transactions have been eliminated in consolidation. The Company’s wholly owned subsidiary, TTM has a 50% interest in Up North Hosting, LLC (“UNH”), which is accounted for as an equity method investment and is not consolidated. See Note 1 and 6 for additional information around UNH. Use of Estimates The preparation of 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 assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during each of the reporting periods. Actual results could differ from those estimates. The Company’s significant estimates consist of: ● Revenue recognition ● Fair value of digital assets ● Expected useful lives and valuation of assets ● Business combinations and reverse merger accounting Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity from the date of purchase of three months or less to be cash equivalents. Concentrations of Credit Risk Financial instruments that potentially subject the Company to credit risk consist primarily of cash. The Company’s cash is deposited with commercial banks in the United States but exceeds federally insured limits from time to time. The recorded carrying amount of cash and cash equivalents approximates their fair value. The Company uses an Exchange to store and trade its digital assets. If demand for crypto assets decline the Exchange could be negatively impacted. Mining Equipment Mining Equipment is stated at cost. Depreciation is computed using the straight-line method regardless of the category of asset. The Company has determined that the useful life of graphics processing units (“GPUs”) is 3-years and remaining mining equipment (primarily chassis, power supply units, computer memory, motherboards, risers, and fans) is depreciated over the estimated useful life of 5-years. Expenditures for repairs and maintenance are charged to expense as incurred. Upon disposition, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statement of operations. The rate at which the Company generates digital assets and, therefore, consumes the economic benefits of its transaction verification servers are influenced by several factors including the following: - the complexity of the transaction verification process which is driven by the algorithms contained within the Ethereum open-source software; - the general availability of appropriate computer processing capacity on a global basis (commonly referred to in the industry as hashing capacity which is measured in Terahash units); and - technological obsolescence reflecting rapid development in the transaction verification server industry such that more recently developed hardware is more economically efficient to run in terms of digital assets generated as a function of operating costs, primarily power costs. i.e., the speed of hardware evolution in the industry is such that later hardware models generally have faster processing capacity combined with lower operating costs and a lower cost of purchase. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of specialized equipment. Management will review this estimate quarterly and will revise such estimates as and when data comes available. To the extent that any of the assumptions underlying management’s estimate of useful life of its mining equipment are subject to revision in a future reporting period either because of changes in circumstances or through the availability of greater quantities of data then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets. Impairment of Long-lived Assets The Company reviews its long-lived assets, including mining equipment, for impairment whenever events or changes in circumstances indicate the carrying value of an asset or group of assets may not be recoverable. The carrying amount is considered not recoverable if the sum of the undiscounted cash flows to be generated from the use and eventual disposition of the asset group is less than the carrying amount of the asset group. If the carrying amount exceeds the undiscounted cash flows, then the carrying amount is compared to the fair value and an impairment loss is recorded for the difference between the fair value and the carrying amount. No impairment charges were identified during the periods ended June 30, 2021, or June 30, 2020. Revenue Recognition The Company recognizes revenue in accordance with ASC 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, five basic criteria must be met before revenue can be recognized: ● Identification of the contract, or contracts, with a customer; ● Identification of the performance obligations in the contract; ● Determination of the transaction price; ● Allocation of the transaction price to the performance obligations in the contract; and ● Recognition of revenue when, or as, the Company satisfies a performance obligation. Mining Revenue TTM Digital has entered into mining pools with the operators to provide computing power to the mining pool. The Company is entitled to a fractional share of the fixed cryptocurrency award the mining pool operator receives (less transaction fees to the mining pool operator) for successfully adding a block to the blockchain. The Company’s fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. Providing computing power in digital asset transaction verification services is an output of the Company’s ordinary activities. The provision of such computing power is the only performance obligation in the Company’s contracts with mining pool operators The transaction consideration the Company receives, if any, is non-cash consideration. The transaction price of the Company’s share of the cryptocurrency award is measured at fair value on the date received, which is not materially different than the fair value at the time the Company has earned the award from the mining pool. The consideration is all variable under the definition within ASC 606. Because it is not probable that a significant reversal of cumulative revenue will not occur, the consideration is constrained until the Company successfully places a block and the Company receives confirmation of the consideration it will receive, at which time revenue is recognized. There is no significant financing component in these transactions. Fair value of the digital asset award received is determined using the quoted price of the related digital asset at the time of receipt. There is currently no specific definitive guidance under GAAP or alternative accounting framework for the accounting for digital assets recognized as revenue or held, and management has exercised significant judgment in determining the appropriate accounting treatment. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies, which could impact the Company’s consolidated financial position and results from operations. Hardware and Software Revenue Recognition SGS is a primary resale channel for a large group of vendors and suppliers, including original equipment manufacturers (“OEMs”), software publishers and wholesale distributors. The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and collectability of consideration is probable. The Company evaluates the following indicators amongst others when determining whether it is acting as a principal in the transaction and recording revenue on a gross basis: (i) the Company is primarily responsible for fulfilling the promise to provide the specified product or service, (ii) the Company has inventory risk before the specified good or service has been transferred to a customer or after transfer of control to the customer and (iii) the Company has discretion in establishing the price for the specified good or service. If the terms of a transaction do not indicate the Company is acting as a principal in the transaction, then the Company is acting as an agent in the transaction and the associated revenues are recognized on a net basis. The Company recognizes revenue once control has passed to the customer. The following indicators are evaluated in determining when control has passed to the customer: (i) the Company has a right to payment for the product or service, (ii) the customer has legal title to the product, (iii) the Company has transferred physical possession of the product to the customer, (iv) the customer has the significant risk and rewards of ownership of the product and (v) the customer has accepted the product. The Company’s products can be delivered to customers in a variety of ways, including (i) as physical product shipped from the Company’s warehouse, (ii) via drop-shipment by the vendor or supplier or (iii) via electronic delivery of keys for software licenses. The Company’s shipping terms typically specify F.O.B. destination. The Company leverages drop-shipment arrangements with many of its vendors and suppliers to deliver products to its customers without having to physically hold the inventory at its warehouse. The Company is the principal in the transaction and recognizes revenue for drop-shipment arrangements on a gross basis. The Company may provide integration of products from multiple vendors as a solution it sells to the customer. In this arrangement, the Company provides direct warranty to the customer with the Company’s own personnel as the customer requires warranty on the solution and not individual vendor products. This type of warranty is sold integral to the overall solution quoted to the customer. The Company considers these service-type warranties to be performance obligations of the principal from the underlying products that make up a solution and therefore is acting as a principal in the transaction and records revenue on a gross basis at the point of sale. License and Maintenance Services Revenue Recognition SGS provides a customized design and configuration solution for its customers and in this capacity resells hardware, software and other IT equipment license and maintenance services in exchange for fixed fees. The Company selects the vendors and sells the products and services, including maintenance services, that best fit the customer’s needs. For sales of maintenance services and warranties, the customer obtains control at the point in time that the services to be provided by a third-party vendor are purchased by the customer and therefore the Company’s performance obligation to provide the overall systems solution is satisfied at that time. The Company’s customers generally pay within 30 to 60 days from the receipt of a customer-approved invoice. For resale of services, including maintenance services, warranties, and extended warranties, the Company is acting as an agent as the primary activity for those services are fulfilled by a third party. While the Company may facilitate and act as a first responder for these services, the third-party service providers perform the primary maintenance and warranty services for the customer. Therefore, the Company is not primarily responsible for performing these services and revenue is recorded on a net basis. Professional Services Revenue Recognition SGS’s professional services include fixed fee contracts. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date. For fixed fee contracts, the Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous service. Because the Company’s contracts have an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations. Anticipated losses are recognized as soon as they become known. For the three months ended June 30, 2021, SGS did not incur any such losses. These amounts are based on known and estimated factors. Revenues from time and material or firm fixed price long-term and short-term contracts are derived principally with various United States government agencies. Contract Balances The timing of revenue recognition may differ from the timing of payment by customers. The Company records a receivable when revenue is recognized prior to payment and there is an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had deferred revenue of $0.6 million as of June 30, 2021. Accounts Receivable, net Account receivables are stated at the amount the Company expects to collect. The Company recognizes an allowance for doubtful accounts to ensure accounts receivables are not overstated due to un-collectability. Bad debt reserves are maintained for various customers based on a variety of factors, including the length of time the receivables are past due, significant one-time events and historical experience. An additional reserve for individual accounts is recorded when the Company becomes aware of a customer’s inability to meet its financial obligation, such as in the case of bankruptcy filings, or deterioration in the customer’s operating results or financial position. If circumstances related to customers change, estimates of the recoverability of receivables would be further adjusted. The Company’s allowance for doubtful accounts was $.05 million as of June 30, 2021. Equity Method Investments Equity method investments are equity securities in entities the Company does not control but over which it can exercise significant influence. These investments are accounted for under the equity method of accounting in accordance with ASC 323, Investments- Equity Method and Joint Ventures. Equity method investments are measured at cost minus impairment, if any, plus or minus the Company’s share of an investee’s income or loss. Digital Assets Digital assets (predominantly Ethereum) are included in current assets in the accompanying consolidated balance sheets. The classification of digital assets as a current asset has been made after the Company’s consideration of the consistent daily trading volume on cryptocurrency exchange markets, there are no limitations or restrictions on Company’s ability to sell Ethereum, and the pattern of actual sales of Ethereum by the Company. Digital assets purchased are recorded at cost and cryptocurrencies awarded to the Company through its mining activities are accounted for in connection with the Company’s revenue recognition policy disclosed above. Digital assets held are accounted for as intangible assets with indefinite useful lives. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the digital asset at the time its fair value is being measured. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. No impairment was determined to have existed at the quarter-end periods reported herein. The Company accounts for its gains or losses in accordance with the first in first out (FIFO) method of accounting. The Company recognized realized gains through the sale and disbursement of digital assets during the three and six months ended June 30, 2021, of $0.001 million and $0.09 million, respectively. For the three and six months ended June 30, 2020, the Company recognized realized gains of $0.01 million and $0.008 million, respectively. Fair Value The Company accounts for digital assets and other operating assets under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 820, Fair Value Measurements. This statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements, ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows: Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 — observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and Level 3 — assets and liabilities whose significant value drivers are unobservable. Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation. In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy. In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment. The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, and accounts payable, approximate fair value due to the short-term nature of these instruments. The Company determined the fair value of digital assets earned during the periods ended June 30, 2021, and 2020 by using quoted prices in active markets. The Company evaluates all accessible active markets and then selects the market which they determine to be the principal market. Fair value is determined by the USD spot at the time digital assets are earned. Digital assets mined by the Company are classified within Level II of the fair value hierarchy. Income Taxes Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing Deferred tax assets (“DTAs”). Based on this evaluation as of June 30, 2021, a valuation allowance of $6.4 million has been recorded through acquisition accounting to recognize only the portion of the DTA that is more likely than not to be realized. Additionally, the Company has not booked an income tax benefit for the current period pretax loss of $24.5 million. This is the primary reason the effective income tax rate differs from the statutory rate of 21 percent. The amount of the DTA considered realizable, however, could be adjusted if estimates of future taxable income are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth. Utilization of the net operating loss and credit carryforwards may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. The Company is currently in the process of evaluating the current NOL as a result of the merger Net Loss per Share Basic loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding, plus potentially dilutive common shares. Convertible debt, preferred stock, restricted stock units, stock options and warrants are excluded from the diluted net loss per share calculation when their impact is antidilutive. The Company reported a net loss for the three- and six-month periods ended June 30, 2021, and 2020, respectively, and as a result, all potentially dilutive common shares are considered antidilutive for these periods. The Company includes potentially issuable shares in the Weighted-average common shares – basic that include warrants and other agreements that are exercisable for little or no consideration without substantive contingencies and others once any contingencies relative to the issuance of the shares is resolved. Computations of basic and diluted weighted average common shares outstanding were as follows for the periods reported: Six Months Ended Three Months Ended June 30, June 30, 2021 2020 2021 2020 Weighted-average common shares outstanding 110,063,554 55,776,240 139,087,196 55,776,240 Weighted-average potential common shares considered outstanding 8,004,843 13,944,060 14,009,685 13,944,060 Weighted-average common shares outstanding - basic 118,068,397 69,720,300 153,096,881 69,720,300 Dilutive effect of options, warrants and restricted stock units - - - - Weighted-average common shares outstanding - diluted 118,068,397 69,720,300 153,096,881 69,720,300 Options and restricted stock units excluded from the computation of diluted loss per share because the effect of inclusion would be anti-dilutive - - - - Recent Accounting Standards In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases. ASU 2016-02 will also require new qualitative and quantitative disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company adopted ASU 2016-02 effective January 1, 2020. ASU 2016-02 did not have a material impact on the financial statements or disclosures. In January 2020, the FASB issued ASU 2020-01, Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815). Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. Emerging Growth Company Sysorex is an “emerging growth company” as defined in the JOBS Act. As such, Sysorex will be eligible to take advantage of certain exemptions from various reporting requirements that apply to other public companies that are not emerging growth companies, including compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. In addition, Section 107 of the JOBS Act provides that an emerging growth company may take advantage of the extended transition period provided in Section 13(a) of the Exchange Act, for complying with new or revised accounting standards, meaning that Sysorex, as an emerging growth company, can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. Sysorex has elected to take advantage of this extended transition period, and therefore our financial statements may not be comparable to those of companies that comply with such new or revised accounting standards. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 5 — Segment Reporting Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (CODM) for purposes of allocating resources and evaluating financial performance. The Company’s CODM is the chief financial officer who reviews financial information presented at the subsidiary level for purposes of allocating resources and evaluating financial performance. As such, the Company’s operations constitute two operating segments and two reportable segments. The following tables reflect the results of continuing operations of the company’s segments consistent with the management and measurement system utilized within the company. Performance measurement is primarily based on revenue and gross profit. These results are used, in part, by the chief operating decision maker, both in evaluating the performance of, and in allocating resources to, each of the segments. The CODM does not evaluate performance or allocate resources based on segment asset data, and therefore such information is not included. The following tables provide a summary of the revenue, cost of revenue for our subsidiary segments for the six and three months ended June 30, 2021 (in thousands): For the three months ended June 30, 2021 TTM Digital Sysorex Government Services Consolidated Revenues Products Revenue $ - $ 1,599 $ 1,599 Services Revenue - 413 413 Mining Income 4,234 - 4,234 Total Revenues $ 4,234 $ 2,012 $ 6,246 Product Cost $ - $ 1,391 $ 1,391 Services Cost - 242 242 Mining Cost 344 - 344 Other Operating Expenses $ 4,837 $ 1,237 $ 6,074 Operating Income (Loss) $ (948 ) $ (857 ) $ (1,805 ) For the six months ended June 30, 2021 TTM Digital Sysorex Government Services Consolidated Revenues Products Revenue $ - $ 1,599 $ 1,599 Services Revenue - 413 413 Mining Income 6,251 - 6,251 Total Revenues $ 6,251 $ 2,012 $ 8,263 Product Cost $ - $ 1,391 $ 1,391 Services Cost - 242 242 Mining Cost 475 - 475 Other Operating expenses $ 5,415 $ 1,237 $ 6,652 Operating Income (Loss) $ 360 $ (857 ) $ (497 ) Total Segment Assets $ 14,715 $ 6,048 $ 20,763 |
Mining Equipment, Net
Mining Equipment, Net | 6 Months Ended |
Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Mining Equipment, net | Note 6 — Mining Equipment, net Mining equipment, net, was comprised of the following at Balance as of June 30, December 31, 2021 2020 Gross Mining Equipment: Mining Equipment (non-GPUs) $ 1,158 $ 554 GPUs 15,542 2,167 Accumulated Depreciation Mining Equipment (non-GPUs) (283 ) (242 ) GPUs (2,636 ) (1,207 ) Mining Equipment, net $ 13,781 $ 1,272 An Ethereum mining server consists of multiple commodity Graphics Processing Units (GPUs) and ancillary components such as chassis, CPU, motherboard, and power supply. The GPUs are solely responsible for the compute power to generate the cryptographic hashes for mining, while the other components act to support the system. Depreciation expense was approximately $1.5 million during the six months ended June 30, 2021, and $1.3 million for the three months ended June 30, 2021. Depreciation expense was approximately $0.4 million during the six months ended June 30, 2020, and $0.2 million for the three months ended June 30, 2020. The Company (TTM Digital) purchased approximately 4,500 GPUs with specialized Cryptocurrency Mining Processors through execution of an Asset Contribution and Exchange Agreement and a Purchase Order for a lease to buy financing arrangement which total $2.2 million over 180 days subject to acceleration based on the completion of certain corporate events. The Company issued 35,588,548 shares of common stock at the merger. The assets and equity were exchanged in April 2021 prior to the reverse merger with Sysorex, Inc. See Subsequent event Note 10 for settlement of the obligation. |
Equity Method Investment
Equity Method Investment | 6 Months Ended |
Jun. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investment | Note 7 — Equity Method Investment The Up North Hosting balance sheet was as follows as of June 30, 2021, and December 31, 2020 (in thousands of dollars): June 30, December 31, 2021 2020 Current assets $ 241 $ 171 Non-current assets 1,211 1,247 Total assets $ 1,452 $ 1,418 Current liabilities 127 131 Total liabilities 127 131 Members’ equity 1,327 1,177 Retained Earnings (Deficit) (2 ) 110 Total Members’ Equity 1,325 1,287 Total Liabilities and Members’ Equity $ 1,452 $ 1,418 As of June 30, 2021, and December 31, 2020, Up North Hosting’s assets and liabilities were primarily comprised of fixed assets and short-term accrued liabilities as reflected on the consolidated balance sheet. Fixed assets, net, which are owned by Up North Hosting, were comprised of the following (in thousands of dollars): June 30, December 31, 2021 2020 Building $ 513 $ 513 Electrical Infrastructure Assets 525 525 Machinery & Equipment Assets 34 30 Mechanical (HVAC) Assets 271 271 Server and Network Assets 50 50 Gross value 1,393 1,389 Accumulated depreciation (217 ) (177 ) Property, plant, and equipment, net $ 1,176 $ 1,212 The Up North Hosting statement of operations for the six and three months ended June 30, 2021, and 2020 was as follows (in thousands of dollars): For the Three Months Ended For the Six Months Ended June 30, June 30, 2021 2020 2021 2020 Revenues $ 247 $ 228 $ 494 $ 710 Cost of revenues, excluding depreciation 198 193 399 349 Selling, general, and administrative 164 60 230 380 Other (Income)/Expense 4 (20 ) (24 ) (20 ) Net Income (loss) (119 ) (5 ) (111 ) 1 Net Income (loss) attributable to TTM $ (60 ) $ (3 ) $ (56 ) $ - The Company’s main cost of revenues relates to the hosting and electricity expenses used to power the Datacenter and the hosted equipment. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Note 8 — Intangible Assets Intangible assets as of June 30, 2021, consist of the following: Gross Net Carrying Accumulated Carrying Amount Amortization Amount Trade name $ 1,060 $ (22 ) $ 1,038 Customer Relationships 1,900 (99 ) 1,801 Total intangible assets $ 2,960 $ (121 ) $ 2,839 Calendar Years ending December 31, Amount Remaining 2021 287 2022 573 2023 573 2024 573 2025 266 Thereafter 567 Total $ 2,839 |
Credit Risk and Concentrations
Credit Risk and Concentrations | 6 Months Ended |
Jun. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
Credit Risk and Concentrations | Note 9 — Credit Risk and Concentrations Financial instruments that subject the Company to credit risk consist principally of trade accounts receivable and cash. The Company performs certain credit evaluation procedures and does not require collateral for financial instruments subject to credit risk. The Company believes that credit risk is limited because the Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk of its customers, establishes an allowance for uncollectible accounts and, consequently, believes that its accounts receivable credit risk exposure beyond such allowances is limited. The Company maintains cash deposits with financial institutions, which, from time to time, may exceed federally insured limits. The Company has not experienced any losses and believes it is not exposed to any significant credit risk from cash. The following table sets forth the percentages of sales derived by SGS from those customers that accounted for at least 10% of sales during the six and three months ended June 30, 2021. (in thousands of dollars): For the period $ % Customer A 1,254 49 % Customer B 492 19 % Customer C 302 12 % As of June 30, 2021, Customer A and Customer B represented approximately 56% and 12% of total accounts receivable. In addition, one additional customer represented 31% of accounts receivable. For the six and three months ended June 30, 2021, four SGS vendors represented approximately 53%, 35%, 28% and 11% of total purchases for SGS products. Purchases from these vendors during the six and three months ended June 30, 2021, were $0.9 million, $0.6 million, $0.4 million and $0.2 million, respectively. Mining equipment purchased from one TTM vendor during the six months ended June 30, 2021, was $14.2 million. Of the $14.2 million, in consideration exchanged $12 million was paid in Common Stock of the Company and the balance of $2.2 million was settled through payment in digital assets. Geographic and Technology Concentration The Company had geographic concentration risk with mining operations being exclusively carried out within New York in the first Quarter 2021 and throughout 2020, while the Company has added geographic diversity during April 2021 using a colocation datacenter in North Carolina. Any legislation that restricts or bans the mining of proof-of-work related digital asset mining in New York State would have a negative impact on the Company’s ability to operate and generate revenues. Further, the Company had concentrated exposure to the Ethereum blockchain infrastructure through its mining operations during the periods presented. There is a possibility of digital asset mining algorithms transitioning to proof-of-stake validation and other mining related risks, which could make us less competitive and ultimately adversely affect our business and our ability to generate revenues. When and if Ethereum switches to proof-of stake the Company’s GPUs will no longer be able to mine Ethereum. Additionally, on August 5, 2021, the London Hard Fork protocol went into effect which includes changes in Ethereum’s handling of transaction fees. These changes could have an impact on the Company’s revenue stream. |
Debt, Related Parties
Debt, Related Parties | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Debt, related parties | Note 10 — Debt, related parties Debt as of June 30, 2021, and December 31, 2020, consisted of the following (in thousands): As of As of 2021 2020 Short-Term Debt Loan from shareholder $ - $ 75 First Choice Promissory Note Payable (A) 1,070 - CoreWeave Inc. Purchase order – GH Hardware (B) 1,156 - Total Short-Term Debt $ 2,226 $ 75 (A) First Choice Promissory Note Payable On March 19, 2021, the Company, Systat and First Choice International Company, Inc. (“Lender”) entered into a Letter Agreement (“Letter Agreement”), providing for the advance payment by the Lender of $2.0 million (“Advance”) to Systat on behalf of the Company. Please see Note 15 Subsequent Events, regarding satisfaction and repayment of the debt in full on July 8, 2021. (B) CoreWeave, Inc. Purchase Order- GH Hardware The Company acquired 1,344 GPU data mining equipment with 125 gigahash of computing power in a lease to buy arrangement with a stated contract price per gigahash. The Company agreed to total payments of $2.2 million over 180 days subject to acceleration based on the completion of certain corporate events. Revenue generated by operation of the equipment from April 1, 2021, shall be credited against the purchase price until payment of the balance of the purchase price. The Company has determined that the fair value of the installment payments is $2.13 million and will record $0.07 million in financing interest costs for the aggregate $2.2 million in total payments. The Company recognized approximately $0.04 million of such interest expense during the three and six months ended June 30, 2021. Please see Note 15 Subsequent Events, regarding satisfaction and repayment of the debt in full on July 21, 2021. |
Digital Assets
Digital Assets | 6 Months Ended |
Jun. 30, 2021 | |
Digital Assets [Abstract] | |
Digital Assets | Note 11- Digital Assets The following table presents the roll forward of digital asset activity during the periods ended: Six months ended 2021 2020 Opening Balance $ 24 $ 25 Revenue from mining 6,252 554 Purchase of mining equipment with digital assets (1,019 ) - Mining pool operating fees (66 ) (2 ) Management fees (322 ) (33 ) Owners distributions (1,521 ) (301 ) Proceeds from sale of digital assets (3,331 ) (230 ) Realized gain on sale of digital assets 88 14 Ending Balance $ 105 $ 26 Three months ended 2021 2020 Opening Balance $ 14 $ 20 Revenue from mining 4,234 274 Purchases of Mining equipment with digital assets (1,019 ) - Mining pool operating fees (45 ) - Management fees - (17 ) Owners’ distributions - (149 ) Proceeds from sale of digital assets (3,080 ) (110 ) Realized gain on sale of digital assets 1 8 Ending Balance $ 105 $ 26 |
Equity
Equity | 6 Months Ended |
Jun. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Equity | Note 12- Equity As discussed in Note 2 Basis of Presentation the Company completed a reverse merger of Sysorex and TTM Digital with TTM Digital being the accounting acquirer and reporting entity. In a reverse merger the capital accounts of the reporting entity (TTM Digital) are restated to reflect the legal capital structure of the legal acquirer (Sysorex). As a result, the share data of the reporting entity has been retroactively restated for all periods presented to the equivalent share values of Sysorex for the capital transaction activity of TTM Digital, as if the reverse merger occurred on January 1, 2020. The share data of the reporting entity has been retroactively stated for all periods presented to the equivalent share values of Sysorex. The Company is authorized to issue 500,000,000 shares of common stock, $0.00001 par value, and 10,000,000 shares of preferred stock, $0.00001 par value. The holders of the Company’s common stock are entitled to one vote per share. As of June 30, 2021, 500,000,000 common stock shares were authorized; 143,588,591 shares were issued, and 143,513,212 shares were outstanding. No preferred stock has been designated or issued. As of December 31, 2019, the Company had 55,776,240 shares outstanding. During the quarter ended September 30, 2020, the Company issued 10,655,680 shares. As of December 31, 2020, the Company had 66,431,290 shares outstanding. During the quarter ended March 31, 2021, the Company issued to Moon Manager LLC, 14,607,980 shares and issued the rights to an additional 2,000,000 shares. Effective on April 1, 2021, TTM Digital entered into an Asset Contribution and Exchange Agreement (Mining Equipment) to acquire approximately 4,500 GPUs with CoreWeave. In connection with the Contribution and Exchange Agreement, TTM Digital issued equity representing 28.65% of the pre-merger equity outstanding for TTM Digital. In settlement of the Contribution and Exchange Agreement the Company issued 35,588,548 shares valued at $12 million. On April 14, 2021, the reverse merger of Sysorex and TTM Digital closed. As a result of the reverse merger, the Company recognized the 494,311 shares outstanding of the existing Sysorex Shareholders and the 75,379 shares of Treasury stock of Sysorex that are part of the legal capital structure. The Company recorded $0.03 million as purchase consideration on the recognition of the existing Sysorex Shareholders share by the reporting entity. As discussed in Note 2, the majority of the Sysorex debt, certain liabilities classified as current and a forward consulting contract with a former Sysorex Board Member (the “Debt Items”) aggregating $19.4 million were converted to 34,097,255 Sysorex shares when fully issued (the “Sysorex Recapitalization”). 25,985,633 shares were immediately issued, prefunded rights were exchanged from an investor’s issued shares for 5,111,622 shares and the right to receive 3,000,000 shares of Sysorex stock at a future date at the option of the holder subject to certain events. During the three months ended June 30, 2021, the Company additionally issued an aggregate of 404,820 shares, comprised of 339,820 pre-merger shares for corporate advisory expertise and consulting services to be provided in relation to the Merger at a value of $1.9 million, and 65,000 shares in exchange for consulting and legal services at a value of $0.04 million. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13 — Commitments and Contingencies Contractual Commitments The Company agreed to hosting arrangements whereby each month, the Company is to pay approximately $0.045 million per month as per the hosting facilities services order and the services agreement for the operation and management of the machines. In addition, the Company entered into a separate services arrangement whereby at a minimum, $0.035 million per month is charged for personnel per the Master Services Agreement. In excess of 525 hours from provider, there are hourly charges. It is not expected that the fee is greater than $35,000 per month. In total, the Company is contractually obligated to pay approximately $0.085 million per month. Litigation Certain conditions may exist as of the date the financial statements are issued which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed, unless they involve guarantees, in which case the guarantees would be disclosed. There can be no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. There are no pending legal proceedings to which the Company is a party to. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 14- Related Party Transactions Effective April 1, 2021, the Company entered a variety of contracts with CoreWeave, Inc. (“CoreWeave”). Asset Contribution and Exchange Agreement On April 1, 2021, CoreWeave contributed 3,130 GPU of data mining equipment with 150 gigahash of computing power to the Company in exchange for an equity interest representing 28.65% of the outstanding pre-merger equity of TTM Digital prior to the merger transaction with Sysorex for a total value of approximately $12 million. As a result of the merger, and in consideration for the 28.65% ownership of TTM Digital. CoreWeave was issued 35,588,548 shares of Sysorex common stock at the merger. Lease to Buy Purchase Order The Company acquired 1,344 GPU data mining equipment with 125 gigahash of computing power in a lease to buy arrangement. The Company agreed to total payments of $2.2 million over 180 days subject to acceleration based on the completion of certain corporate events. Revenue generated by operation of the equipment from April 1, 2021, shall be credited against the purchase price until payment of the balance of the purchase price. The Company has determined that the fair value of the installment payments is $2.1 million and will record $0.07 million in financing interest costs for the aggregate $2.2 million in installment payments. The Company recognized approximately $0.046 million of such interest expense during the three and six months ended June 30, 2021. See Note 10 Debt, related parties for the outstanding obligation as of June 30, 2021. Hosting Facilities Services Order The Hosting Facility Services Order (the “Hosting Contract”) provided for the provision of hosting facility space and services by CoreWeave. The services are paid for in advance of the service month and the initial term of the hosting services is through June 30, 2022 and renews automatically for successive one year renewal terms unless either party terminates within sixty days of the expiration of the then current term. At the signing of the Hosting Contract an estimated 382 data mining rigs were covered at an estimated monthly cost of approximately $21,556 ($0.2 million per year). The Company recorded $0.06 million in hosting costs for the six months ended June 30, 2021. Services Agreement The initial term of the Services Agreement runs from April 1, 2021, through June 30, 2022, and automatically renews thereafter for successive one (1)-year terms unless either party provides written notice to the other of nonrenewal within sixty (60) days of the expiration of the then current Term. The initiation of the Services Agreement required a one-time payment of $0.1 million. The monthly base management fee was set to $20.00 per GPU-based Mining System (approximately $0.02 million per month), and $6.50 per ASIC-based Mining System. Base management fees are paid in arrears and due within fifteen (15) days of invoice receipt. If, during any calendar month of the Term, CoreWeave operates on average, more than 1,500 Mining Systems on behalf of the Company, the Base Management Fee with respect to the excess Mining Systems above 1,500 is discounted by Forty Percent (40%). The Company recorded $0.07 million in mining costs for the six months ended June 30, 2021. Master Services Agreement On April 29, 2021, the Company entered into a Master Services Agreement with CoreWeave to provide support to management relating to cryptocurrency expertise, marketing, and other operational matters for a three-month term. The compensation for these services is a fixed fee of $35,000 per 30-day period, which includes 175 hours per period. The Company recorded $0.07 million in service costs for the six months ended June 30, 2021. First Choice International Company, Inc. On March 19, 2021, the Company, Systat and First Choice International Company, Inc. (“First Choice”) entered into a Letter Agreement (“Letter Agreement”), providing for the advance payment by the Lender of $2 million (the “Advance”) to Systat on behalf of the Company. In consideration of the Advance, Systat agreed it would (a) enter into a Securities Settlement Agreement (“SSA”) with the Company for the exchange of three promissory notes owed by the Company to Systat in the aggregate principal amount of $3.3 million plus accrued interest (the “Exchanged Notes”) for equity of the Company in the Sysorex Recapitalization; and (b) assign an additional note dated June 30, 2020, in the principal amount of $3 million (the “Assigned First Choice Note”) to First Choice. First Choice further agreed to enter into a SSA to exchange the Assigned First Choice Note for equity in the Company in the Sysorex Recapitalization. In addition, the Company obtained additional financing of approximately $278,000 from First Choice on April 14, 2021, immediately before the Merger execution through a Commercial Loan Agreement. As of the Merger the Company carried approximately $5,414,000 in debt owed to First Choice for the Advance, the Assigned First Choice Note, the Commercial Loan Agreement (collectively the “First Choice Notes”) and accrued interest on the First Choice Notes. In the Sysorex Recapitalization transaction the $3 million Assigned First Choice Note was exchanged for the right to 5,272,407 shares of Company stock. In payment for the debt, First Choice was compensated with 160,785 share of Company stock and 5,111,622 Prefunded Warrants with an exercise price of $.00001 per share. During the quarter ended June 30, 2021, the Company paid $1.3 million to First Choice to reduce the amount of debt owed. As of June 30, 2021, the balance of the loans with First Choice were approximately $1 million. The Company made additional payments to First Choice in July 2021 and as noted in Note 15 Subsequent Events made a final payment on July 8, 2021, of approximately $1 million in full satisfaction of the First Choice obligations. Bespoke Growth Partners, Inc. On July 13, 2020, the Company executed an agreement with Bespoke Growth Partners, Inc. (“Bespoke”) for the provision of consulting services to Sysorex. Bespoke was compensated $25,000 for this consulting services agreement and amendments plus the issuance of 250,000 shares of Company stock. On April 1, 2021, TTM Digital executed a consulting agreement with Bespoke which called for compensation equal to 4.5% of the outstanding pre-merger equity of TTM Digital. In payment for corporate advisory expertise and consulting services, Bespoke was compensated with 339,820 shares of Company Stock and 5,250,000 Prefunded Warrants with an exercise price of $.00001 per share. The compensation was valued at approximately $1.9 million and, recorded in General and Administrative expenses in the Condensed Consolidated Statements of Operations. |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | Note 15 — Subsequent Event On July 7, 2021, the Company consummated the initial closing (the “Initial Closing”) of a private placement offering (the “Offering”) pursuant to the terms and conditions of that certain Securities Purchase Agreement, dated as of July 7, 2021 (the “Purchase Agreement”), between the Company and forty (40) accredited investors (the “Purchasers”). At the Initial Closing, the Company sold the Purchasers (i) 12.5% Original Issue Discount Senior Secured Convertible Debentures (the “Debentures”) in an aggregate principal amount of $9,990,000.00 and (ii) warrants (the “Warrants” and together with the Debentures, the “Underlying Securities”) to purchase up to 3,534,751 shares of common stock of the Company (the “Common Stock”), subject to adjustments provided by the Warrants, or units of Common Stock and Common Stock purchase warrants, which represents 100% warrant coverage. The Company received a total of $8,880,000 in gross proceeds at the Initial Offering, taking into account the 12.5% original issue discount, before deducting offering expenses and commissions. The maximum number of shares of Common Stock that may be issued through the conversion of the Debentures and the exercise of the Warrants as of July 7, 2021 (the “Original Issue Date”) is 7,069,502. On July 8, 2021, the Company paid $979,883 to First Choice International Company, Inc., in full satisfaction of the Company’s promissory note obligation. On July 20, 2021, the Board of Directors of the Company approved an amendment (the “Plan Amendment”) of the Company’s 2018 Equity Incentive Plan (as so amended, the “Plan”) to increase the number of shares of the Company’s common stock reserved for issuance thereunder by 8,000,000 shares. The Plan Amendment became effective immediately. On July 21, 2021, the Company paid $1,003,185 to CoreWeave, in full satisfaction of the remaining amount of the Company’s lease to buy mining equipment obligation. On July 26, 2021, the Company and Mr. Wasserberg entered into an amendment to the employment agreement in connection with Mr. Wasserberg’s services as the Chief Executive Officer of the Company and President, Treasurer, and Secretary of its wholly owned subsidiary TTM on May 7, 2021, effective as of July 20, 2021 (the “Amendment”). The Amendment increases the total number of restricted shares of Common Stock issuable to Mr. Wasserberg pursuant to the Agreement to 1,000,000 and provides that the entirety of the shares will be issued pursuant to the Plan in accordance with the following vesting schedule: (i) 500,000 shares of Common Stock will be issued and vested as of July 20, 2021 and (ii) additional 500,000 shares of restricted Common Stock will be issued and vested on January 20, 2022, provided that such issuance and vesting will occur only if Mr. Wasserberg remains an employee of the Company and TTM as of such date. On August 13, 2021, the Company consummated the second closing (the “Second Closing”) of a private placement offering pursuant to the terms and conditions of that certain Securities Purchase Agreement, dated as of July 7, 2021 (the “Purchase Agreement”), between the Company and thirty-nine (39) accredited investors (the “Purchasers”). At the Second Closing, the Company sold the Purchasers (i) 12.5% Original Issue Discount Senior Secured Convertible Debentures (the “Debentures”) in an aggregate principal amount of $3,976,875 and (ii) warrants (the “Warrants” and together with the Debentures, the “Underlying Securities”) to purchase up to 1,862,279 shares of Common Stock, subject to adjustments provided by the Warrants, or units of Common Stock and Common Stock purchase warrants, which represents 100% warrant coverage, for aggregate gross proceeds of $3,535,000, taking into account the 12.5% original issue discount, before deducting offering expenses and commissions. The maximum number of shares of Common Stock that may be issued through the conversion of the Debentures and the exercise of the Warrants of the Second Closing as of August 13, 2021, is 3,724,558. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements have been prepared using the accounting records of Sysorex, TTM and SGS. All material inter-company balances and transactions have been eliminated in consolidation. The Company’s wholly owned subsidiary, TTM has a 50% interest in Up North Hosting, LLC (“UNH”), which is accounted for as an equity method investment and is not consolidated. See Note 1 and 6 for additional information around UNH. |
Use of Estimates | Use of Estimates The preparation of 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 assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during each of the reporting periods. Actual results could differ from those estimates. The Company’s significant estimates consist of: ● Revenue recognition ● Fair value of digital assets ● Expected useful lives and valuation of assets ● Business combinations and reverse merger accounting |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity from the date of purchase of three months or less to be cash equivalents. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to credit risk consist primarily of cash. The Company’s cash is deposited with commercial banks in the United States but exceeds federally insured limits from time to time. The recorded carrying amount of cash and cash equivalents approximates their fair value. The Company uses an Exchange to store and trade its digital assets. If demand for crypto assets decline the Exchange could be negatively impacted. |
Mining Equipment | Mining Equipment Mining Equipment is stated at cost. Depreciation is computed using the straight-line method regardless of the category of asset. The Company has determined that the useful life of graphics processing units (“GPUs”) is 3-years and remaining mining equipment (primarily chassis, power supply units, computer memory, motherboards, risers, and fans) is depreciated over the estimated useful life of 5-years. Expenditures for repairs and maintenance are charged to expense as incurred. Upon disposition, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statement of operations. The rate at which the Company generates digital assets and, therefore, consumes the economic benefits of its transaction verification servers are influenced by several factors including the following: - the complexity of the transaction verification process which is driven by the algorithms contained within the Ethereum open-source software; - the general availability of appropriate computer processing capacity on a global basis (commonly referred to in the industry as hashing capacity which is measured in Terahash units); and - technological obsolescence reflecting rapid development in the transaction verification server industry such that more recently developed hardware is more economically efficient to run in terms of digital assets generated as a function of operating costs, primarily power costs. i.e., the speed of hardware evolution in the industry is such that later hardware models generally have faster processing capacity combined with lower operating costs and a lower cost of purchase. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of specialized equipment. Management will review this estimate quarterly and will revise such estimates as and when data comes available. To the extent that any of the assumptions underlying management’s estimate of useful life of its mining equipment are subject to revision in a future reporting period either because of changes in circumstances or through the availability of greater quantities of data then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets The Company reviews its long-lived assets, including mining equipment, for impairment whenever events or changes in circumstances indicate the carrying value of an asset or group of assets may not be recoverable. The carrying amount is considered not recoverable if the sum of the undiscounted cash flows to be generated from the use and eventual disposition of the asset group is less than the carrying amount of the asset group. If the carrying amount exceeds the undiscounted cash flows, then the carrying amount is compared to the fair value and an impairment loss is recorded for the difference between the fair value and the carrying amount. No impairment charges were identified during the periods ended June 30, 2021, or June 30, 2020. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with ASC 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, five basic criteria must be met before revenue can be recognized: ● Identification of the contract, or contracts, with a customer; ● Identification of the performance obligations in the contract; ● Determination of the transaction price; ● Allocation of the transaction price to the performance obligations in the contract; and ● Recognition of revenue when, or as, the Company satisfies a performance obligation. |
Mining Revenue [Policy Text Block] | Mining Revenue TTM Digital has entered into mining pools with the operators to provide computing power to the mining pool. The Company is entitled to a fractional share of the fixed cryptocurrency award the mining pool operator receives (less transaction fees to the mining pool operator) for successfully adding a block to the blockchain. The Company’s fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. Providing computing power in digital asset transaction verification services is an output of the Company’s ordinary activities. The provision of such computing power is the only performance obligation in the Company’s contracts with mining pool operators The transaction consideration the Company receives, if any, is non-cash consideration. The transaction price of the Company’s share of the cryptocurrency award is measured at fair value on the date received, which is not materially different than the fair value at the time the Company has earned the award from the mining pool. The consideration is all variable under the definition within ASC 606. Because it is not probable that a significant reversal of cumulative revenue will not occur, the consideration is constrained until the Company successfully places a block and the Company receives confirmation of the consideration it will receive, at which time revenue is recognized. There is no significant financing component in these transactions. Fair value of the digital asset award received is determined using the quoted price of the related digital asset at the time of receipt. There is currently no specific definitive guidance under GAAP or alternative accounting framework for the accounting for digital assets recognized as revenue or held, and management has exercised significant judgment in determining the appropriate accounting treatment. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies, which could impact the Company’s consolidated financial position and results from operations. Hardware and Software Revenue Recognition SGS is a primary resale channel for a large group of vendors and suppliers, including original equipment manufacturers (“OEMs”), software publishers and wholesale distributors. The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and collectability of consideration is probable. The Company evaluates the following indicators amongst others when determining whether it is acting as a principal in the transaction and recording revenue on a gross basis: (i) the Company is primarily responsible for fulfilling the promise to provide the specified product or service, (ii) the Company has inventory risk before the specified good or service has been transferred to a customer or after transfer of control to the customer and (iii) the Company has discretion in establishing the price for the specified good or service. If the terms of a transaction do not indicate the Company is acting as a principal in the transaction, then the Company is acting as an agent in the transaction and the associated revenues are recognized on a net basis. The Company recognizes revenue once control has passed to the customer. The following indicators are evaluated in determining when control has passed to the customer: (i) the Company has a right to payment for the product or service, (ii) the customer has legal title to the product, (iii) the Company has transferred physical possession of the product to the customer, (iv) the customer has the significant risk and rewards of ownership of the product and (v) the customer has accepted the product. The Company’s products can be delivered to customers in a variety of ways, including (i) as physical product shipped from the Company’s warehouse, (ii) via drop-shipment by the vendor or supplier or (iii) via electronic delivery of keys for software licenses. The Company’s shipping terms typically specify F.O.B. destination. The Company leverages drop-shipment arrangements with many of its vendors and suppliers to deliver products to its customers without having to physically hold the inventory at its warehouse. The Company is the principal in the transaction and recognizes revenue for drop-shipment arrangements on a gross basis. The Company may provide integration of products from multiple vendors as a solution it sells to the customer. In this arrangement, the Company provides direct warranty to the customer with the Company’s own personnel as the customer requires warranty on the solution and not individual vendor products. This type of warranty is sold integral to the overall solution quoted to the customer. The Company considers these service-type warranties to be performance obligations of the principal from the underlying products that make up a solution and therefore is acting as a principal in the transaction and records revenue on a gross basis at the point of sale. License and Maintenance Services Revenue Recognition SGS provides a customized design and configuration solution for its customers and in this capacity resells hardware, software and other IT equipment license and maintenance services in exchange for fixed fees. The Company selects the vendors and sells the products and services, including maintenance services, that best fit the customer’s needs. For sales of maintenance services and warranties, the customer obtains control at the point in time that the services to be provided by a third-party vendor are purchased by the customer and therefore the Company’s performance obligation to provide the overall systems solution is satisfied at that time. The Company’s customers generally pay within 30 to 60 days from the receipt of a customer-approved invoice. For resale of services, including maintenance services, warranties, and extended warranties, the Company is acting as an agent as the primary activity for those services are fulfilled by a third party. While the Company may facilitate and act as a first responder for these services, the third-party service providers perform the primary maintenance and warranty services for the customer. Therefore, the Company is not primarily responsible for performing these services and revenue is recorded on a net basis. Professional Services Revenue Recognition SGS’s professional services include fixed fee contracts. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date. For fixed fee contracts, the Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous service. Because the Company’s contracts have an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations. Anticipated losses are recognized as soon as they become known. For the three months ended June 30, 2021, SGS did not incur any such losses. These amounts are based on known and estimated factors. Revenues from time and material or firm fixed price long-term and short-term contracts are derived principally with various United States government agencies. Contract Balances The timing of revenue recognition may differ from the timing of payment by customers. The Company records a receivable when revenue is recognized prior to payment and there is an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had deferred revenue of $0.6 million as of June 30, 2021. Accounts Receivable, net Account receivables are stated at the amount the Company expects to collect. The Company recognizes an allowance for doubtful accounts to ensure accounts receivables are not overstated due to un-collectability. Bad debt reserves are maintained for various customers based on a variety of factors, including the length of time the receivables are past due, significant one-time events and historical experience. An additional reserve for individual accounts is recorded when the Company becomes aware of a customer’s inability to meet its financial obligation, such as in the case of bankruptcy filings, or deterioration in the customer’s operating results or financial position. If circumstances related to customers change, estimates of the recoverability of receivables would be further adjusted. The Company’s allowance for doubtful accounts was $.05 million as of June 30, 2021. Equity Method Investments Equity method investments are equity securities in entities the Company does not control but over which it can exercise significant influence. These investments are accounted for under the equity method of accounting in accordance with ASC 323, Investments- Equity Method and Joint Ventures. Equity method investments are measured at cost minus impairment, if any, plus or minus the Company’s share of an investee’s income or loss. Digital Assets Digital assets (predominantly Ethereum) are included in current assets in the accompanying consolidated balance sheets. The classification of digital assets as a current asset has been made after the Company’s consideration of the consistent daily trading volume on cryptocurrency exchange markets, there are no limitations or restrictions on Company’s ability to sell Ethereum, and the pattern of actual sales of Ethereum by the Company. Digital assets purchased are recorded at cost and cryptocurrencies awarded to the Company through its mining activities are accounted for in connection with the Company’s revenue recognition policy disclosed above. Digital assets held are accounted for as intangible assets with indefinite useful lives. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the digital asset at the time its fair value is being measured. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. No impairment was determined to have existed at the quarter-end periods reported herein. The Company accounts for its gains or losses in accordance with the first in first out (FIFO) method of accounting. The Company recognized realized gains through the sale and disbursement of digital assets during the three and six months ended June 30, 2021, of $0.001 million and $0.09 million, respectively. For the three and six months ended June 30, 2020, the Company recognized realized gains of $0.01 million and $0.008 million, respectively. Fair Value The Company accounts for digital assets and other operating assets under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 820, Fair Value Measurements. This statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements, ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows: Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 — observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and Level 3 — assets and liabilities whose significant value drivers are unobservable. Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation. In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy. In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment. The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, and accounts payable, approximate fair value due to the short-term nature of these instruments. The Company determined the fair value of digital assets earned during the periods ended June 30, 2021, and 2020 by using quoted prices in active markets. The Company evaluates all accessible active markets and then selects the market which they determine to be the principal market. Fair value is determined by the USD spot at the time digital assets are earned. Digital assets mined by the Company are classified within Level II of the fair value hierarchy. Income Taxes Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing Deferred tax assets (“DTAs”). Based on this evaluation as of June 30, 2021, a valuation allowance of $6.4 million has been recorded through acquisition accounting to recognize only the portion of the DTA that is more likely than not to be realized. Additionally, the Company has not booked an income tax benefit for the current period pretax loss of $24.5 million. This is the primary reason the effective income tax rate differs from the statutory rate of 21 percent. The amount of the DTA considered realizable, however, could be adjusted if estimates of future taxable income are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth. Utilization of the net operating loss and credit carryforwards may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. The Company is currently in the process of evaluating the current NOL as a result of the merger |
Net Loss per Share | Net Loss per Share Basic loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding, plus potentially dilutive common shares. Convertible debt, preferred stock, restricted stock units, stock options and warrants are excluded from the diluted net loss per share calculation when their impact is antidilutive. The Company reported a net loss for the three- and six-month periods ended June 30, 2021, and 2020, respectively, and as a result, all potentially dilutive common shares are considered antidilutive for these periods. The Company includes potentially issuable shares in the Weighted-average common shares – basic that include warrants and other agreements that are exercisable for little or no consideration without substantive contingencies and others once any contingencies relative to the issuance of the shares is resolved. Computations of basic and diluted weighted average common shares outstanding were as follows for the periods reported: Six Months Ended Three Months Ended June 30, June 30, 2021 2020 2021 2020 Weighted-average common shares outstanding 110,063,554 55,776,240 139,087,196 55,776,240 Weighted-average potential common shares considered outstanding 8,004,843 13,944,060 14,009,685 13,944,060 Weighted-average common shares outstanding - basic 118,068,397 69,720,300 153,096,881 69,720,300 Dilutive effect of options, warrants and restricted stock units - - - - Weighted-average common shares outstanding - diluted 118,068,397 69,720,300 153,096,881 69,720,300 Options and restricted stock units excluded from the computation of diluted loss per share because the effect of inclusion would be anti-dilutive - - - - |
Recent Accounting Standards | Recent Accounting Standards In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases. ASU 2016-02 will also require new qualitative and quantitative disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company adopted ASU 2016-02 effective January 1, 2020. ASU 2016-02 did not have a material impact on the financial statements or disclosures. In January 2020, the FASB issued ASU 2020-01, Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815). Any new accounting standards, not disclosed above, that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. |
Emerging Growth Company | Emerging Growth Company Sysorex is an “emerging growth company” as defined in the JOBS Act. As such, Sysorex will be eligible to take advantage of certain exemptions from various reporting requirements that apply to other public companies that are not emerging growth companies, including compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. In addition, Section 107 of the JOBS Act provides that an emerging growth company may take advantage of the extended transition period provided in Section 13(a) of the Exchange Act, for complying with new or revised accounting standards, meaning that Sysorex, as an emerging growth company, can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. Sysorex has elected to take advantage of this extended transition period, and therefore our financial statements may not be comparable to those of companies that comply with such new or revised accounting standards. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of fair value of the identified assets acquired and liabilities | (In thousands of dollars) Reverse Sysorex Aggregate Fair Cash $ 28 $ - $ 28 Accounts receivable 4,673 - 4,673 Prepaid assets and other current assets 2,551 (1,289 ) 1,262 Property and equipment 7 - 7 Goodwill 1,634 - 1,634 Customer Relationships Intangible 1,900 - 1,900 Tradename Intangible 1,060 - 1,060 Other assets 29 - 29 Accounts payable (10,437 ) 519 (9,918 ) Accrued liabilities (2,722 ) 1,589 (1,133 ) Deferred revenue (590 ) - (590 ) Short term debt (7,136 ) 3,871 (3,265 ) Long term debt (12,711 ) 12,711 - Other liabilities (9 ) - (9 ) Fair value allocated to net assets / (liabilities) $ (21,723 ) $ 17,401 $ (4,322 ) Fair value of consideration and recapitalization equity $ 281 $ 19,401 $ 19,682 Merger charges (22,004 ) - (22,004 ) Debt restructuring fees - (2,000 ) (2,000 ) Net Sysorex equity and charges to income (loss) $ (21,723 ) $ 17,401 $ (4,322 ) |
Schedule of unaudited proforma results of operations | Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Total Revenues $ 10,513 $ 2,604 $ 13,937 $ 5,150 Net Income (Loss) 406 (943 ) 535 (1,905 ) Net Income (Loss) per share - basic and diluted 0.003 (0.014 ) 0.005 (0.027 ) Weighted Average Shares Outstanding - basic and diluted 153,096,881 69,720,300 118,068,397 69,720,300 Supplemental Pro forma Information (a) Merger charges 22,004 - 22,004 - Restructuring fee 2,000 - 2,000 - Transaction costs - Accounting acquirer and acquiree 3,093 - 3,093 - Total Nonrecurring Pro forma Adjustments 27,097 - 27,097 - |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of basic and diluted weighted average common shares outstanding | Six Months Ended Three Months Ended June 30, June 30, 2021 2020 2021 2020 Weighted-average common shares outstanding 110,063,554 55,776,240 139,087,196 55,776,240 Weighted-average potential common shares considered outstanding 8,004,843 13,944,060 14,009,685 13,944,060 Weighted-average common shares outstanding - basic 118,068,397 69,720,300 153,096,881 69,720,300 Dilutive effect of options, warrants and restricted stock units - - - - Weighted-average common shares outstanding - diluted 118,068,397 69,720,300 153,096,881 69,720,300 Options and restricted stock units excluded from the computation of diluted loss per share because the effect of inclusion would be anti-dilutive - - - - |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of cost of revenue for our Seller segment | For the three months ended June 30, 2021 TTM Digital Sysorex Government Services Consolidated Revenues Products Revenue $ - $ 1,599 $ 1,599 Services Revenue - 413 413 Mining Income 4,234 - 4,234 Total Revenues $ 4,234 $ 2,012 $ 6,246 Product Cost $ - $ 1,391 $ 1,391 Services Cost - 242 242 Mining Cost 344 - 344 Other Operating Expenses $ 4,837 $ 1,237 $ 6,074 Operating Income (Loss) $ (948 ) $ (857 ) $ (1,805 ) For the six months ended June 30, 2021 TTM Digital Sysorex Government Services Consolidated Revenues Products Revenue $ - $ 1,599 $ 1,599 Services Revenue - 413 413 Mining Income 6,251 - 6,251 Total Revenues $ 6,251 $ 2,012 $ 8,263 Product Cost $ - $ 1,391 $ 1,391 Services Cost - 242 242 Mining Cost 475 - 475 Other Operating expenses $ 5,415 $ 1,237 $ 6,652 Operating Income (Loss) $ 360 $ (857 ) $ (497 ) Total Segment Assets $ 14,715 $ 6,048 $ 20,763 |
Mining Equipment, Net (Tables)
Mining Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of mining equipment, net | Balance as of June 30, December 31, 2021 2020 Gross Mining Equipment: Mining Equipment (non-GPUs) $ 1,158 $ 554 GPUs 15,542 2,167 Accumulated Depreciation Mining Equipment (non-GPUs) (283 ) (242 ) GPUs (2,636 ) (1,207 ) Mining Equipment, net $ 13,781 $ 1,272 |
Equity Method Investment (Table
Equity Method Investment (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of balance sheet | June 30, December 31, 2021 2020 Current assets $ 241 $ 171 Non-current assets 1,211 1,247 Total assets $ 1,452 $ 1,418 Current liabilities 127 131 Total liabilities 127 131 Members’ equity 1,327 1,177 Retained Earnings (Deficit) (2 ) 110 Total Members’ Equity 1,325 1,287 Total Liabilities and Members’ Equity $ 1,452 $ 1,418 |
Schedule of fixed asset net | June 30, December 31, 2021 2020 Building $ 513 $ 513 Electrical Infrastructure Assets 525 525 Machinery & Equipment Assets 34 30 Mechanical (HVAC) Assets 271 271 Server and Network Assets 50 50 Gross value 1,393 1,389 Accumulated depreciation (217 ) (177 ) Property, plant, and equipment, net $ 1,176 $ 1,212 |
Schedule of operation | For the Three Months Ended For the Six Months Ended June 30, June 30, 2021 2020 2021 2020 Revenues $ 247 $ 228 $ 494 $ 710 Cost of revenues, excluding depreciation 198 193 399 349 Selling, general, and administrative 164 60 230 380 Other (Income)/Expense 4 (20 ) (24 ) (20 ) Net Income (loss) (119 ) (5 ) (111 ) 1 Net Income (loss) attributable to TTM $ (60 ) $ (3 ) $ (56 ) $ - |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Gross Net Carrying Accumulated Carrying Amount Amortization Amount Trade name $ 1,060 $ (22 ) $ 1,038 Customer Relationships 1,900 (99 ) 1,801 Total intangible assets $ 2,960 $ (121 ) $ 2,839 |
Schedule of remaining years | Calendar Years ending December 31, Amount Remaining 2021 287 2022 573 2023 573 2024 573 2025 266 Thereafter 567 Total $ 2,839 |
Credit Risk and Concentrations
Credit Risk and Concentrations (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
Schedule of risk percentage of sales | For the period $ % Customer A 1,254 49 % Customer B 492 19 % Customer C 302 12 % |
Debt, Related Parties (Tables)
Debt, Related Parties (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of debt | As of As of 2021 2020 Short-Term Debt Loan from shareholder $ - $ 75 First Choice Promissory Note Payable (A) 1,070 - CoreWeave Inc. Purchase order – GH Hardware (B) 1,156 - Total Short-Term Debt $ 2,226 $ 75 |
Digital Assets (Tables)
Digital Assets (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Digital Assets [Abstract] | |
Schedule of digital assets | Six months ended 2021 2020 Opening Balance $ 24 $ 25 Revenue from mining 6,252 554 Purchase of mining equipment with digital assets (1,019 ) - Mining pool operating fees (66 ) (2 ) Management fees (322 ) (33 ) Owners distributions (1,521 ) (301 ) Proceeds from sale of digital assets (3,331 ) (230 ) Realized gain on sale of digital assets 88 14 Ending Balance $ 105 $ 26 Three months ended 2021 2020 Opening Balance $ 14 $ 20 Revenue from mining 4,234 274 Purchases of Mining equipment with digital assets (1,019 ) - Mining pool operating fees (45 ) - Management fees - (17 ) Owners’ distributions - (149 ) Proceeds from sale of digital assets (3,080 ) (110 ) Realized gain on sale of digital assets 1 8 Ending Balance $ 105 $ 26 |
Going Concern (Details)
Going Concern (Details) $ in Millions | Jun. 30, 2021USD ($) |
Going Concern [Abstract] | |
Cash balance | $ 0.1 |
Working capital deficit | 9.5 |
Accumulated deficit | $ 24.7 |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 02, 2021 | Jun. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Dec. 31, 2020 |
Basis of Presentation (Details) [Line Items] | |||||
Number of common stock right to receive (in Shares) | 35,588,548 | 404,820 | 10,655,680 | ||
Common stock par value per share (in Dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||
Percentage of outstanding shares of capital stock | 80.00% | ||||
Purchase consideration | $ 0.3 | $ 0.3 | |||
Goodwill | $ 1.6 | 1.6 | |||
Debt conversion, converted instrument, amount | $ 19.4 | ||||
Shares issued (in Shares) | 1,900,000 | ||||
Debt conversion price per share (in Dollars per share) | $ 0.569 | $ 0.569 | |||
Debt restructuring fees expense | $ 2 | $ 2 | |||
Prepaid consulting contract | 0.7 | 0.7 | |||
General and administrative expenses | $ 1.9 | 3.1 | |||
Revenues | 2 | ||||
Operating loss | 0.5 | ||||
Net loss of reverse merger | $ 2 | $ 0.9 | |||
Sysorex stock [Member] | |||||
Basis of Presentation (Details) [Line Items] | |||||
Shares issued (in Shares) | 34,097,255 | ||||
Shares were immediately issued (in Shares) | 25,985,633 | ||||
Prefunded warrant was issued (in Shares) | 5,111,622 | ||||
Future shares issued (in Shares) | 3,000,000 | 3,000,000 | |||
TTM Digital [Member] | |||||
Basis of Presentation (Details) [Line Items] | |||||
Number of common stock right to receive (in Shares) | 124,218,268 | ||||
Common stock par value per share (in Dollars per share) | $ 0.00001 | $ 0.00001 |
Basis of Presentation (Detail_2
Basis of Presentation (Details) - Schedule of fair value of the identified assets acquired and liabilities $ in Thousands | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Reverse Acquisition Fair Value [Member] | |
Basis of Presentation (Details) - Schedule of fair value of the identified assets acquired and liabilities [Line Items] | |
Cash | $ 28 |
Accounts receivable | 4,673 |
Prepaid assets and other current assets | 2,551 |
Property and equipment | 7 |
Goodwill | 1,634 |
Customer Relationships Intangible | 1,900 |
Tradename Intangible | 1,060 |
Other assets | 29 |
Accounts payable | (10,437) |
Accrued liabilities | (2,722) |
Deferred revenue | (590) |
Short term debt | (7,136) |
Long term debt | (12,711) |
Other liabilities | (9) |
Fair value allocated to net assets / (liabilities) | (21,723) |
Fair value of consideration and recapitalization equity | 281 |
Merger charges | (22,004) |
Debt restructuring fees | |
Net Sysorex equity and charges to income (loss) | (21,723) |
Sysorex Recapitalization Fair Value [Member] | |
Basis of Presentation (Details) - Schedule of fair value of the identified assets acquired and liabilities [Line Items] | |
Cash | |
Accounts receivable | |
Prepaid assets and other current assets | (1,289) |
Property and equipment | |
Goodwill | |
Customer Relationships Intangible | |
Tradename Intangible | |
Other assets | |
Accounts payable | 519 |
Accrued liabilities | 1,589 |
Deferred revenue | |
Short term debt | 3,871 |
Long term debt | 12,711 |
Other liabilities | |
Fair value allocated to net assets / (liabilities) | 17,401 |
Fair value of consideration and recapitalization equity | 19,401 |
Merger charges | |
Debt restructuring fees | (2,000) |
Net Sysorex equity and charges to income (loss) | 17,401 |
Aggregate Fair Value [Member] | |
Basis of Presentation (Details) - Schedule of fair value of the identified assets acquired and liabilities [Line Items] | |
Cash | 28 |
Accounts receivable | 4,673 |
Prepaid assets and other current assets | 1,262 |
Property and equipment | 7 |
Goodwill | 1,634 |
Customer Relationships Intangible | 1,900 |
Tradename Intangible | 1,060 |
Other assets | 29 |
Accounts payable | (9,918) |
Accrued liabilities | (1,133) |
Deferred revenue | (590) |
Short term debt | (3,265) |
Long term debt | |
Other liabilities | (9) |
Fair value allocated to net assets / (liabilities) | (4,322) |
Fair value of consideration and recapitalization equity | 19,682 |
Merger charges | (22,004) |
Debt restructuring fees | (2,000) |
Net Sysorex equity and charges to income (loss) | $ (4,322) |
Basis of Presentation (Detail_3
Basis of Presentation (Details) - Schedule of unaudited proforma results of operations - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Schedule of unaudited proforma results of operations [Abstract] | |||||
Total Revenues | $ 10,513 | $ 2,604 | $ 13,937 | $ 5,150 | |
Net Income (Loss) | $ 406 | $ (943) | $ 535 | $ (1,905) | |
Net Income (Loss) per share - basic and diluted (in Dollars per share) | $ 0.003 | $ (0.014) | $ 0.005 | $ (0.027) | |
Weighted Average Shares Outstanding - basic and diluted (in Shares) | 153,096,881 | 69,720,300 | 118,068,397 | 69,720,300 | |
Supplemental Pro forma Information (a) | |||||
Merger charges | [1] | $ 22,004 | $ 22,004 | ||
Restructuring fee | [1] | 2,000 | 2,000 | ||
Transaction costs - Accounting acquirer and acquiree | [1] | 3,093 | 3,093 | ||
Total Nonrecurring Pro forma Adjustments | [1] | $ 27,097 | $ 27,097 | ||
[1] | Supplemental Pro forma Information consists of material, nonrecurring pro forma adjustments directly attributable to the reverse acquisition and Sysorex Recapitalization |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Summary of Significant Accounting Policies (Details) [Line Items] | ||||
Principles of consolidation interest percentage | 50.00% | |||
Deferred revenue | $ 600,000 | $ 600,000 | ||
Allowance for doubtful accounts | 5 | 5 | ||
Sale and disbursement of digital assets | 1,000 | 90,000 | ||
Recognized realized gains | $ 10,000 | $ 8,000 | ||
Valuation allowance | $ 6,400,000 | 6,400,000 | ||
Income tax benefit | $ 24,500,000 | |||
Income tax rate | 21.00% | |||
Minimum [Member] | ||||
Summary of Significant Accounting Policies (Details) [Line Items] | ||||
Estimated useful life | 3 | |||
Maximum [Member] | ||||
Summary of Significant Accounting Policies (Details) [Line Items] | ||||
Estimated useful life | 5 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of basic and diluted weighted average common shares outstanding - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of basic and diluted weighted average common shares outstanding [Abstract] | ||||
Weighted-average common shares outstanding | 139,087,196 | 55,776,240 | 110,063,554 | 55,776,240 |
Weighted-average potential common shares considered outstanding | 14,009,685 | 13,944,060 | 8,004,843 | 13,944,060 |
Weighted-average common shares outstanding - basic | 153,096,881 | 69,720,300 | 118,068,397 | 69,720,300 |
Dilutive effect of options, warrants and restricted stock units (in Dollars) | ||||
Weighted-average common shares outstanding - diluted | 153,096,881 | 69,720,300 | 118,068,397 | 69,720,300 |
Options and restricted stock units excluded from the computation of diluted loss per share because the effect of inclusion would be anti-dilutive |
Segment Reporting (Details)
Segment Reporting (Details) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Number of operating segements | 2 |
Number of reporting segements | 2 |
Segment Reporting (Details) - S
Segment Reporting (Details) - Schedule of cost of revenue for our Seller segment - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
TTM Digital [Member] | ||
Revenues | ||
Products Revenue | ||
Services Revenue | ||
Mining Income | 4,234 | 6,251 |
Total Revenues | 4,234 | 6,251 |
Product Cost | ||
Services Cost | ||
Mining Cost | 344 | 475 |
Other Operating Expenses | 4,837 | 5,415 |
Total Segment Assets | 14,715 | |
Operating Income (Loss) | (948) | 360 |
Sysorex Government Services [Member] | ||
Revenues | ||
Products Revenue | 1,599 | 1,599 |
Services Revenue | 413 | 413 |
Mining Income | ||
Total Revenues | 2,012 | 2,012 |
Product Cost | 1,391 | 1,391 |
Services Cost | 242 | 242 |
Mining Cost | ||
Other Operating Expenses | 1,237 | 1,237 |
Total Segment Assets | 6,048 | |
Operating Income (Loss) | (857) | (857) |
Consolidated [Member] | ||
Revenues | ||
Products Revenue | 1,599 | 1,599 |
Services Revenue | 413 | 413 |
Mining Income | 4,234 | 6,251 |
Total Revenues | 6,246 | 8,263 |
Product Cost | 1,391 | 1,391 |
Services Cost | 242 | 242 |
Mining Cost | 344 | 475 |
Other Operating Expenses | 6,074 | 6,652 |
Total Segment Assets | 20,763 | |
Operating Income (Loss) | $ (1,805) | $ (497) |
Mining Equipment, Net (Details)
Mining Equipment, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Mining Equipment, Net (Details) [Line Items] | ||||
Depreciation expense | $ 1.3 | $ 1.5 | ||
Depreciation expenses | $ 0.2 | $ 0.4 | ||
Gross proceeds | $ 2.2 | |||
Common Stock [Member] | ||||
Mining Equipment, Net (Details) [Line Items] | ||||
Shares issued (in Shares) | 35,588,548 | 35,588,548 |
Mining Equipment, Net (Detail_2
Mining Equipment, Net (Details) - Schedule of mining equipment, net - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Gross Mining Equipment: | ||
Mining Equipment, net | $ 13,781 | $ 1,272 |
Mining Equipment (non-GPUs) [Member] | ||
Gross Mining Equipment: | ||
Mining Equipment (non-GPUs) | (283) | (242) |
GPUs [Member] | ||
Gross Mining Equipment: | ||
Graphics Processing Units | (2,636) | (1,207) |
Mining Equipment (non-GPUs) [Member] | ||
Gross Mining Equipment: | ||
Mining Equipment (non-GPUs) | 1,158 | 554 |
GPUs [Member] | ||
Gross Mining Equipment: | ||
Graphics Processing Units | $ 15,542 | $ 2,167 |
Equity Method Investment (Detai
Equity Method Investment (Details) - Schedule of balance sheet - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Schedule of balance sheet [Abstract] | ||
Current assets | $ 241 | $ 171 |
Non-current assets | 1,211 | 1,247 |
Total assets | 1,452 | 1,418 |
Current liabilities | 127 | 131 |
Total liabilities | 127 | 131 |
Members’ equity | 1,327 | 1,177 |
Retained Earnings (Deficit) | (2) | 110 |
Total Members’ Equity | 1,325 | 1,287 |
Total Liabilities and Members’ Equity | $ 1,452 | $ 1,418 |
Equity Method Investment (Det_2
Equity Method Investment (Details) - Schedule of fixed asset net - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Schedule of fixed asset net [Abstract] | ||
Building | $ 513 | $ 513 |
Electrical Infrastructure Assets | 525 | 525 |
Machinery & Equipment Assets | 34 | 30 |
Mechanical (HVAC) Assets | 271 | 271 |
Server and Network Assets | 50 | 50 |
Gross value | 1,393 | 1,389 |
Accumulated depreciation | (217) | (177) |
Property, plant, and equipment, net | $ 1,176 | $ 1,212 |
Equity Method Investment (Det_3
Equity Method Investment (Details) - Schedule of operation - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of operation [Abstract] | ||||
Revenues | $ 247 | $ 228 | $ 494 | $ 710 |
Cost of revenues, excluding depreciation | 198 | 193 | 399 | 349 |
Selling, general, and administrative | 164 | 60 | 230 | 380 |
Other (Income)/Expense | 4 | (20) | (24) | (20) |
Net Income (loss) | (119) | (5) | (111) | 1 |
Net Income (loss) attributable to TTM | $ (60) | $ (3) | $ (56) |
Intangible Assets (Details) - S
Intangible Assets (Details) - Schedule of intangible assets $ in Thousands | Jun. 30, 2021USD ($) |
Intangible Assets (Details) - Schedule of intangible assets [Line Items] | |
Gross Carrying Amount | $ 2,960 |
Accumulated Amortization | (121) |
Net Carrying Amount | 2,839 |
Trade name [Member] | |
Intangible Assets (Details) - Schedule of intangible assets [Line Items] | |
Gross Carrying Amount | 1,060 |
Accumulated Amortization | (22) |
Net Carrying Amount | 1,038 |
Customer Relationships [Member] | |
Intangible Assets (Details) - Schedule of intangible assets [Line Items] | |
Gross Carrying Amount | 1,900 |
Accumulated Amortization | (99) |
Net Carrying Amount | $ 1,801 |
Intangible Assets (Details) -_2
Intangible Assets (Details) - Schedule of remaining years $ in Thousands | Jun. 30, 2021USD ($) |
Schedule of remaining years [Abstract] | |
Remaining 2021 | $ 287 |
2022 | 573 |
2023 | 573 |
2024 | 573 |
2025 | 266 |
Thereafter | 567 |
Total | $ 2,839 |
Credit Risk and Concentration_2
Credit Risk and Concentrations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | |
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 10.00% | ||
Purchases from vendors | $ 14,200 | ||
Cash paid | $ 100 | 100 | |
TTM Vendor [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Purchases from vendors | 14,200 | ||
Cash pain in common stock | 12,000 | ||
Cash paid | $ 2,200 | 2,200 | |
Total Purchase [Member] | Vendor One [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 53.00% | ||
Purchases from SGS vendors | Purchases from these vendors during the six and three months ended June 30, 2021, were $0.9 million, $0.6 million, $0.4 million and $0.2 million, respectively. | ||
Purchases from vendors | $ 900 | ||
Total Purchase [Member] | Vendor Two [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 35.00% | ||
Purchases from vendors | $ 600 | ||
Total Purchase [Member] | Vendor Three [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 28.00% | ||
Purchases from vendors | $ 400 | ||
Total Purchase [Member] | Vendor Four [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 11.00% | ||
Purchases from vendors | $ 200 | ||
Customer A [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Purchases from vendors | 1,254 | $ 1,254 | |
Customer A [Member] | Accounts Receivable [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 56.00% | ||
Customer B [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Purchases from vendors | $ 492 | $ 492 | |
Customer B [Member] | Accounts Receivable [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 12.00% | ||
Accounts Receivable [Member] | Additional Customer [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Number of customer | one | ||
Additional Customer [Member] | Accounts Receivable [Member] | |||
Credit Risk and Concentrations (Details) [Line Items] | |||
Concentration risk, percentage | 31.00% |
Credit Risk and Concentration_3
Credit Risk and Concentrations (Details) - Schedule of risk percentage of sales - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Customer A [Member] | ||
Revenue, Major Customer [Line Items] | ||
Purchases from vendors | $ 1,254 | $ 1,254 |
Concentration risk, percentage | 49.00% | 49.00% |
Customer B [Member] | ||
Revenue, Major Customer [Line Items] | ||
Purchases from vendors | $ 492 | $ 492 |
Concentration risk, percentage | 19.00% | 19.00% |
Customer C [Member] | ||
Revenue, Major Customer [Line Items] | ||
Purchases from vendors | $ 302 | $ 302 |
Concentration risk, percentage | 12.00% | 12.00% |
Debt, Related Parties (Details)
Debt, Related Parties (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended |
Mar. 19, 2021 | Jun. 30, 2021 | Jun. 30, 2021 | |
Debt, Related Parties (Details) [Line Items] | |||
Purchase order , description | The Company acquired 1,344 GPU data mining equipment with 125 gigahash of computing power in a lease to buy arrangement with a stated contract price per gigahash. The Company agreed to total payments of $2.2 million over 180 days subject to acceleration based on the completion of certain corporate events. Revenue generated by operation of the equipment from April 1, 2021, shall be credited against the purchase price until payment of the balance of the purchase price. | ||
Fair value of installment payments | $ 2,130 | ||
Financing interest costs | 70 | ||
Aggregate of Total Payments | $ 2,200 | ||
Interest expense | $ 40 | $ 40 | |
Lender [Member] | |||
Debt, Related Parties (Details) [Line Items] | |||
Advance payment | $ 2,000 |
Debt, Related Parties (Detail_2
Debt, Related Parties (Details) - Schedule of debt - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2021 | Dec. 31, 2020 | ||
Short-Term Debt | |||
Loan from shareholder | $ 75 | ||
First Choice Promissory Note Payable | [1] | 1,070 | |
CoreWeave Inc. Purchase order – GH Hardware | [2] | 1,156 | |
Total Short-Term Debt | $ 2,226 | $ 75 | |
[1] | First Choice Promissory Note Payable On March 19, 2021, the Company, Systat and First Choice International Company, Inc. (“Lender”) entered into a Letter Agreement (“Letter Agreement”), providing for the advance payment by the Lender of $2.0 million (“Advance”) to Systat on behalf of the Company. Please see Note 15 Subsequent Events, regarding satisfaction and repayment of the debt in full on July 8, 2021. | ||
[2] | CoreWeave, Inc. Purchase Order- GH Hardware The Company acquired 1,344 GPU data mining equipment with 125 gigahash of computing power in a lease to buy arrangement with a stated contract price per gigahash. The Company agreed to total payments of $2.2 million over 180 days subject to acceleration based on the completion of certain corporate events. Revenue generated by operation of the equipment from April 1, 2021, shall be credited against the purchase price until payment of the balance of the purchase price. The Company has determined that the fair value of the installment payments is $2.13 million and will record $0.07 million in financing interest costs for the aggregate $2.2 million in total payments. The Company recognized approximately $0.04 million of such interest expense during the three and six months ended June 30, 2021. Please see Note 15 Subsequent Events, regarding satisfaction and repayment of the debt in full on July 21, 2021. |
Digital Assets (Details) - Sche
Digital Assets (Details) - Schedule of digital assets - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of digital assets [Abstract] | ||||
Opening Balance | $ 14 | $ 20 | $ 24 | $ 25 |
Revenue from mining | 4,234 | 274 | 6,252 | 554 |
Purchase | (1,019) | (1,019) | ||
Mining pool operating fees | (45) | (66) | (2) | |
Management fees | (17) | (322) | (33) | |
Owners | (149) | (1,521) | (301) | |
Proceeds from sale of digital assets | (3,080) | (110) | (3,331) | (230) |
Realized gain on sale of digital assets | 1 | 8 | 88 | 14 |
Ending Balance | $ 105 | $ 26 | $ 105 | $ 26 |
Equity (Details)
Equity (Details) - USD ($) | Apr. 02, 2021 | Apr. 14, 2021 | Mar. 31, 2021 | Jun. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Dec. 31, 2019 | Dec. 31, 2020 |
Equity (Details) [Line Items] | ||||||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | 500,000,000 | |||||
Common stock, par value (in Dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||||
Common stock vote, description | The holders of the Company’s common stock are entitled to one vote per share. | |||||||
Common stock, shares issued | 143,588,591 | 143,588,591 | 66,431,920 | |||||
Common stock, shares outstanding | 143,513,212 | 143,513,212 | 66,431,920 | |||||
Preferred stock, designated or issued | 0 | |||||||
Outstanding shares | 55,776,240 | |||||||
Shares issued | 35,588,548 | 404,820 | 10,655,680 | |||||
Equity outstanding, percentage | 28.65% | |||||||
Value of shares (in Dollars) | $ 12,000,000 | |||||||
Reverse merger, description | As a result of the reverse merger, the Company recognized the 494,311 shares outstanding of the existing Sysorex Shareholders and the 75,379 shares of Treasury stock of Sysorex that are part of the legal capital structure. The Company recorded $0.03 million as purchase consideration on the recognition of the existing Sysorex Shareholders share by the reporting entity. | |||||||
Merger aggrement, description | As discussed in Note 2, the majority of the Sysorex debt, certain liabilities classified as current and a forward consulting contract with a former Sysorex Board Member (the “Debt Items”) aggregating $19.4 million were converted to 34,097,255 Sysorex shares when fully issued (the “Sysorex Recapitalization”). 25,985,633 shares were immediately issued, prefunded rights were exchanged from an investor’s issued shares for 5,111,622 shares and the right to receive 3,000,000 shares of Sysorex stock at a future date at the option of the holder subject to certain events. | |||||||
Pre-merger shares | 339,820 | |||||||
Debt Conversion, Converted Instrument, Shares Issued | 1,900,000 | |||||||
Merger value (in Dollars) | $ 65,000 | |||||||
Legal fees (in Dollars per share) | $ 40,000 | |||||||
Common Stock [Member] | ||||||||
Equity (Details) [Line Items] | ||||||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | ||||||
Common stock, par value (in Dollars per share) | $ 0.00001 | $ 0.00001 | ||||||
Preferred Stock [Member] | ||||||||
Equity (Details) [Line Items] | ||||||||
Preferred stock, shares issued | 10,000,000 | 10,000,000 | ||||||
Preferred stock, par value (in Dollars per share) | $ 0.00001 | $ 0.00001 | ||||||
Moon Manager Warants [Member] | ||||||||
Equity (Details) [Line Items] | ||||||||
Shares issued | 14,607,980 | |||||||
Aggregate of amount proceeds (in Dollars) | $ 66,431,290 | |||||||
Prefunded Warrants [Member] | ||||||||
Equity (Details) [Line Items] | ||||||||
Additional shares purchased | 2,000,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Hosting facilities services order and the services agreement | $ 45 |
Master Services Agreement personnel charge | $ 35 |
Contractual commitments, Description | In excess of 525 hours from provider, there are hourly charges. It is not expected that the fee is greater than $35,000 per month. In total, the Company is contractually obligated to pay approximately $0.085 million per month. |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Jul. 08, 2021 | Apr. 14, 2021 | Apr. 02, 2021 | Apr. 29, 2021 | Mar. 19, 2021 | Jun. 30, 2021 | Jul. 13, 2021 |
Related Party Transactions (Details) [Line Items] | |||||||
Ownership | 28.65% | ||||||
Installment payment description | 2 million over 180 days subject to acceleration based on the completion of certain corporate events. Revenue generated by operation of the equipment from April 1, 2021, shall be credited against the purchase price until payment of the balance of the purchase price. The Company has determined that the fair value of the installment payments is $2.1 million and will record $0.07 million in financing interest costs for the aggregate $2.2 million in installment payments. The Company recognized approximately $0.046 million of such interest expense during the three and six months ended June 30, 2021. | ||||||
Cover expenses description | At the signing of the Hosting Contract an estimated 382 data mining rigs were covered at an estimated monthly cost of approximately $21,556 ($0.2 million per year). | ||||||
Hosting costs | $ 60,000 | ||||||
Services agreement description | The initial term of the Services Agreement runs from April 1, 2021, through June 30, 2022, and automatically renews thereafter for successive one (1)-year terms unless either party provides written notice to the other of nonrenewal within sixty (60) days of the expiration of the then current Term. The initiation of the Services Agreement required a one-time payment of $0.1 million. The monthly base management fee was set to $20.00 per GPU-based Mining System (approximately $0.02 million per month), and $6.50 per ASIC-based Mining System. Base management fees are paid in arrears and due within fifteen (15) days of invoice receipt. If, during any calendar month of the Term, CoreWeave operates on average, more than 1,500 Mining Systems on behalf of the Company, the Base Management Fee with respect to the excess Mining Systems above 1,500 is discounted by Forty Percent (40%). The Company recorded $0.07 million in mining costs for the six months ended June 30, 2021. | ||||||
Advance payment amount | $ 2,000,000 | ||||||
Principal amount | $ 3,300,000 | $ 3,000,000 | |||||
Additional financing amount | $ 278,000 | ||||||
Debt owed advance amount | 5,414,000 | ||||||
Transaction amount | $ 3,000,000 | ||||||
Exchange shares (in Shares) | 5,272,407 | ||||||
Compensated shares (in Shares) | 160,785 | ||||||
Prefunded Warrants (in Shares) | 5,111,622 | ||||||
Debt amount | $ 1,300,000 | ||||||
Loan amount | 1,000,000 | ||||||
Outstanding equity percentage | 4.50% | ||||||
Agreement provided shares (in Shares) | 339,820 | ||||||
Warrants shares (in Shares) | 5,250,000 | ||||||
Exercise price (in Dollars per share) | $ 1 | ||||||
General and administrative expenses | $ 1,900,000 | 3,100,000 | |||||
Subsequent Event [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Final payment amount | $ 1,000,000 | ||||||
Services agreement amount | $ 25,000 | ||||||
Shares issued (in Shares) | 250,000 | ||||||
Asset Contribution and Exchange Agreement [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Equity interest percentage | 28.65% | ||||||
Master Services Agreement [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Services cost | $ 35,000 | $ 70,000 | |||||
TTM Digital [Member] | Asset Contribution and Exchange Agreement [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Merger transaction value | $ 12,000,000 | ||||||
Corweave, Inc. [Member] | Asset Contribution and Exchange Agreement [Member] | |||||||
Related Party Transactions (Details) [Line Items] | |||||||
Shares issued (in Shares) | 35,588,548 |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent Event [Member] - USD ($) $ in Thousands | Aug. 13, 2021 | Jul. 26, 2021 | Jul. 21, 2021 | Jul. 08, 2021 | Jul. 07, 2021 | Jul. 20, 2021 |
Subsequent Event (Details) [Line Items] | ||||||
Purchase agreement, description | (i) 12.5% Original Issue Discount Senior Secured Convertible Debentures (the “Debentures”) in an aggregate principal amount of $9,990,000.00 and (ii) warrants (the “Warrants” and together with the Debentures, the “Underlying Securities”) to purchase up to 3,534,751 shares of common stock of the Company (the “Common Stock”), subject to adjustments provided by the Warrants, or units of Common Stock and Common Stock purchase warrants, which represents 100% warrant coverage. The Company received a total of $8,880,000 in gross proceeds at the Initial Offering, taking into account the 12.5% original issue discount, before deducting offering expenses and commissions. The maximum number of shares of Common Stock that may be issued through the conversion of the Debentures and the exercise of the Warrants as of July 7, 2021 (the “Original Issue Date”) is 7,069,502. | |||||
Common stock reserved for issuance of shares | 8,000,000 | |||||
Vesting, description | The Amendment increases the total number of restricted shares of Common Stock issuable to Mr. Wasserberg pursuant to the Agreement to 1,000,000 and provides that the entirety of the shares will be issued pursuant to the Plan in accordance with the following vesting schedule: (i) 500,000 shares of Common Stock will be issued and vested as of July 20, 2021 and (ii) additional 500,000 shares of restricted Common Stock will be issued and vested on January 20, 2022, provided that such issuance and vesting will occur only if Mr. Wasserberg remains an employee of the Company and TTM as of such date. | |||||
Subsequent event, description | the Company consummated the second closing (the “Second Closing”) of a private placement offering pursuant to the terms and conditions of that certain Securities Purchase Agreement, dated as of July 7, 2021 (the “Purchase Agreement”), between the Company and thirty-nine (39) accredited investors (the “Purchasers”). At the Second Closing, the Company sold the Purchasers (i) 12.5% Original Issue Discount Senior Secured Convertible Debentures (the “Debentures”) in an aggregate principal amount of $3,976,875 and (ii) warrants (the “Warrants” and together with the Debentures, the “Underlying Securities”) to purchase up to 1,862,279 shares of Common Stock, subject to adjustments provided by the Warrants, or units of Common Stock and Common Stock purchase warrants, which represents 100% warrant coverage, for aggregate gross proceeds of $3,535,000, taking into account the 12.5% original issue discount, before deducting offering expenses and commissions. The maximum number of shares of Common Stock that may be issued through the conversion of the Debentures and the exercise of the Warrants of the Second Closing as of August 13, 2021, is 3,724,558. | |||||
First Choice International Company, Inc [Member] | ||||||
Subsequent Event (Details) [Line Items] | ||||||
Paid in promissory note obligation | $ 979,883 | |||||
CoreWeave, Inc [Member] | ||||||
Subsequent Event (Details) [Line Items] | ||||||
Paid to buy mining equipment obligation | $ 1,003,185 | |||||
Maximum [Member] | ||||||
Subsequent Event (Details) [Line Items] | ||||||
Agreement of shares | 1,000,000 |