Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 10, 2021 | |
Document Information Line Items | ||
Entity Registrant Name | 1847 GOEDEKER INC. | |
Trading Symbol | GOED | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 106,387,332 | |
Amendment Flag | false | |
Entity Central Index Key | 0001810140 | |
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 | 001-39418 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 83-3713938 | |
Entity Address, Address Line One | 3817 Millstone Parkway | |
Entity Address, City or Town | St. Charles | |
Entity Address, Country | MO | |
Entity Address, Postal Zip Code | 63301 | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Security Exchange Name | NYSE | |
Entity Interactive Data Current | Yes | |
City Area Code | 888 | |
Local Phone Number | 768-1710 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 45,234,542 | $ 934,729 |
Restricted cash | 8,385,848 | 8,977,187 |
Receivables | 21,266,787 | 1,998,232 |
Vendor deposits | 10,755,209 | 547,648 |
Merchandise inventory, net | 21,134,023 | 5,147,241 |
Prepaid expenses and other current assets | 3,680,975 | 635,084 |
Total Current Assets | 110,457,384 | 18,240,121 |
Property and equipment, net | 2,480,055 | 245,948 |
Operating lease right-of-use assets, net | 12,822,972 | 1,578,235 |
Goodwill | 222,107,789 | 4,725,689 |
Intangible assets, net | 1,170,239 | 1,381,937 |
Deferred tax asset | 8,049,978 | |
Other long-term assets | 45,000 | 45,000 |
TOTAL ASSETS | 357,133,417 | 26,216,930 |
Current Liabilities | ||
Accounts payable and accrued expenses | 51,897,666 | 12,701,715 |
Due to Sellers | 3,351,024 | |
Customer deposits | 30,811,985 | 21,879,210 |
Current portion of notes payable, net | 6,455,272 | 663,339 |
Current portion finance lease liability | 65,378 | |
Current portion of operating lease liabilities | 2,157,010 | 450,712 |
Contingent note payable | 188,170 | |
Total Current Liabilities | 94,926,505 | 35,694,976 |
Notes payable, net of current portion, net | 51,344,869 | 2,522,030 |
Finance lease liability, net of current portion | 145,431 | |
Operating lease liabilities, net of current portion | 12,149,107 | 1,127,523 |
Contingent note payable | 188,170 | |
TOTAL LIABILITIES | 158,565,912 | 39,532,699 |
Stockholders’ Equity (Deficit) | ||
Preferred stock, $0.0001 par value, 20,000,000 shares authorized; none issued and outstanding as of June 30, 2021 or December 31, 2020 | ||
Common stock, $0.0001 par value, 200,000,000 shares authorized; 106,374,232 and 6,111,200 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively | 10,638 | 611 |
Additional paid-in capital | 224,743,096 | 13,409,328 |
Accumulated deficit | (26,186,229) | (26,725,708) |
Total Stockholders’ Equity (Deficit) | 198,567,505 | (13,315,769) |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ 357,133,417 | $ 26,216,930 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Jun. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 106,374,232 | 6,111,200 |
Common stock, shares outstanding | 106,374,232 | 6,111,200 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Statement [Abstract] | ||||
Product sales, net | $ 64,072,098 | $ 15,285,031 | $ 77,769,466 | $ 24,962,209 |
Cost of goods sold | 51,016,609 | 12,685,158 | 62,085,520 | 20,796,328 |
Gross profit | 13,055,489 | 2,599,873 | 15,683,946 | 4,165,881 |
Operating Expenses | ||||
Personnel | 4,821,168 | 1,040,189 | 6,752,492 | 2,351,673 |
Advertising | 2,931,815 | 891,907 | 4,015,063 | 1,558,343 |
Bank and credit card fees | 2,095,359 | 454,569 | 2,628,101 | 699,309 |
Depreciation and amortization | 175,143 | 91,790 | 297,475 | 183,631 |
Acquisition expenses | 357,411 | 802,899 | ||
Loss on abandonment of right of use asset | 1,437,042 | 1,437,042 | ||
General and administrative | 2,500,381 | 1,509,417 | 4,294,390 | 2,949,257 |
Total Operating Expenses | 14,318,319 | 3,987,872 | 20,227,462 | 7,742,213 |
LOSS FROM OPERATIONS | (1,262,830) | (1,387,999) | (4,543,516) | (3,576,332) |
Other Income (Expense) | ||||
Interest income | 12,283 | 1,062 | 22,379 | 1,062 |
Financing costs | (74,738) | (74,504) | (80,003) | (269,186) |
Interest expense | (943,392) | (296,708) | (1,170,957) | (557,996) |
Loss on extinguishment of debt | (1,747,901) | (948,856) | (1,747,901) | (948,856) |
Write-off of acquisition receivable | (809,000) | (809,000) | ||
Change in fair value of warrant liability | (2,127,656) | (2,127,656) | ||
Other income (expense) | 794 | 2,880 | 10,999 | 5,263 |
Total Other Income (Expense) | (2,752,954) | (4,252,782) | (2,965,483) | (4,706,369) |
NET LOSS BEFORE INCOME TAXES | (4,015,784) | (5,640,781) | (7,508,999) | (8,282,701) |
INCOME TAX (EXPENSE) BENEFIT | 8,048,478 | 688,953 | 8,048,478 | 1,123,953 |
NET INCOME (LOSS) | $ 4,032,694 | $ (4,951,828) | $ 539,479 | $ (7,158,748) |
NET INCOME (LOSS) PER COMMON SHARE (in Dollars per share) | $ 0.11 | $ (0.99) | $ 0.03 | $ (1.43) |
DILUTED NET INCOME (LOSS) PER COMMON SHARE (in Dollars per share) | $ 0.09 | $ (0.99) | $ 0.02 | $ (1.43) |
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING – | ||||
BASIC (in Shares) | 36,540,827 | 5,000,000 | 21,410,073 | 5,000,000 |
DILUTED (in Shares) | 46,448,892 | 5,000,000 | 26,364,106 | 5,000,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders’ Equity (Deficit) (Unaudited) - USD ($) | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2019 | $ 475 | $ 1,079,179 | $ (5,157,871) | $ (4,078,217) |
Balance (in Shares) at Dec. 31, 2019 | 4,750,000 | |||
Net income (loss) | (2,206,920) | (2,206,920) | ||
Balance at Mar. 31, 2020 | $ 475 | 1,079,179 | (7,364,791) | (6,285,137) |
Balance (in Shares) at Mar. 31, 2020 | 4,750,000 | |||
Issuance of 1847 Holdings warrants in connection with notes payable | 566,711 | 566,711 | ||
Forgiveness of related party debt | 137,500 | 137,500 | ||
Issuance of 1847 Holdings shares in connection with exercise of warrant | 275,000 | 275,000 | ||
Net income (loss) | (4,951,828) | (4,951,828) | ||
Balance at Jun. 30, 2020 | $ 475 | 2,058,390 | (12,316,619) | (10,257,754) |
Balance (in Shares) at Jun. 30, 2020 | 4,750,000 | |||
Balance at Dec. 31, 2020 | $ 611 | 13,409,328 | (26,725,708) | (13,315,769) |
Balance (in Shares) at Dec. 31, 2020 | 6,111,200 | |||
Stock-based compensation expense | 124,575 | 124,575 | ||
Issuance of warrants in connection with notes payable | 1,340,438 | 1,340,438 | ||
Net income (loss) | (3,493,215) | (3,493,215) | ||
Balance at Mar. 31, 2021 | $ 611 | 14,874,341 | (30,218,923) | (15,343,971) |
Balance (in Shares) at Mar. 31, 2021 | 6,111,200 | |||
Issuance of common stock in connection with acquisition | $ 590 | 12,263,034 | 12,263,624 | |
Issuance of common stock in connection with acquisition (in Shares) | 5,895,973 | |||
Issuance of common stock in connection with public offering | $ 9,311 | 194,588,189 | 194,597,500 | |
Issuance of common stock in connection with public offering (in Shares) | 93,111,111 | |||
Issuance of stock grants | $ 22 | 554,978 | 555,000 | |
Issuance of stock grants (in Shares) | 216,800 | |||
Exercise of warrants | $ 104 | 2,337,979 | 2,338,083 | |
Exercise of warrants (in Shares) | 1,039,148 | |||
Stock-based compensation expense | 124,575 | 124,575 | ||
Net income (loss) | 4,032,694 | 4,032,694 | ||
Balance at Jun. 30, 2021 | $ 10,638 | $ 224,743,096 | $ (26,186,229) | $ 198,567,505 |
Balance (in Shares) at Jun. 30, 2021 | 106,374,232 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ 539,479 | $ (7,158,748) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 297,475 | 183,631 |
Amortization of debt discount | 666,927 | 318,599 |
Stock-based compensation expense | 804,150 | |
Loss on extinguishment of debt | 1,747,901 | 948,856 |
Loss on abandonment of right of use asset | 1,437,042 | |
Write-off of acquisition receivable | 809,000 | |
Change in fair value of warrant liability | 2,127,656 | |
Deferred tax assets | (8,049,978) | (1,123,953) |
Non-cash lease expense | 340,687 | 207,883 |
Changes in operating assets and liabilities: | ||
Receivables | 475,812 | (214,726) |
Vendor deposits | (207,561) | (50,543) |
Merchandise inventory | 2,313,999 | (344,635) |
Prepaid expenses and other assets | (1,037,508) | (1,914,049) |
Accounts payable and accrued expenses | (4,358,830) | 2,003,642 |
Customer deposits | (1,740,825) | 8,267,312 |
Operating lease liabilities | (214,072) | (207,883) |
Net cash provided by (used in) provided by operating activities | (6,985,302) | 3,852,042 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (509,428) | (7,000) |
Cash paid to Sellers in acquisition, net of cash acquired | (197,623,238) | |
Net cash used in investing activities | (198,132,666) | (7,000) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from equity offering | 194,597,500 | |
Cash received from warrant exercise | 2,338,083 | |
Proceeds from term note payable | 55,216,594 | 642,500 |
Repayment on notes payable | (3,321,536) | (181,674) |
Payments on finance leases | (4,199) | |
Net payments on lines of credit | (814,492) | |
Net cash provided by (used in) financing activities | 248,826,442 | (353,566) |
NET CHANGE IN CASH AND RESTRICTED CASH | 43,708,474 | 3,491,476 |
CASH AND RESTRICTED CASH, BEGINNING OF PERIOD | 9,911,916 | 64,470 |
CASH AND RESTRICTED CASH, END OF PERIOD | 53,620,390 | 3,555,946 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Cash paid for interest | 1,018,317 | 170,385 |
Cash paid for taxes | 697,976 | |
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Right of use assets acquired | 11,108,055 | |
Right of use liabilities assumed | 11,108,055 | |
Debt discount on notes payable from OID | 910,000 | |
Debt discount, warrants on short-term note payable | 1,340,438 | |
Stock issued in the acquisition of Appliances Connection | 12,263,624 | |
Debt paid off through issuance of new note | 5,616,111 | |
Due to Seller (consideration) settled by vendor deposits | 5,000,000 | |
Conversion of debt through issuance of 1847 Holdings common shares | 275,000 | |
Exercise of warrant liability through issuance of 1847 Holdings non-controlling interest | 118,500 | |
Derecognition of related party debt | 137,500 | |
Adjustment to fair value of goodwill based on final purchase price allocation | 121,736 | |
Cash, cash equivalents, and restricted cash consist of the following: | ||
Cash and cash equivalents | 45,234,542 | 3,555,946 |
Restricted cash | 8,385,848 | |
Cash and cash equivalents and restricted cash total | 53,620,390 | 3,555,946 |
Cash, cash equivalents, and restricted cash consist of the following | ||
Cash and cash equivalents | 934,729 | 64,470 |
Restricted cash | 8,977,187 | |
Cash and cash equivalents and restricted cash total | $ 9,911,916 | $ 64,470 |
Organization and Nature of Busi
Organization and Nature of Business | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
ORGANIZATION AND NATURE OF BUSINESS | NOTE 1—ORGANIZATION AND NATURE OF BUSINESS 1847 Goedeker Inc. (the “Company”) was formed under the laws of the State of Delaware on January 10, 2019 for the sole purpose of acquiring the business of Goedeker Television Co. Prior to the acquisition, the Company did not have any operations other than operations relating to its incorporation and organization. On April 5, 2019, the Company acquired substantially all the assets and assumed substantially all the liabilities of Goedeker Television Co., a Missouri corporation (“Goedeker”). As a result of this transaction, the Company acquired the former business of Goedeker and continues to operate this business. On October 20, 2020, the Company formed Appliances Connection Inc. (“ACI”) as a wholly owned subsidiary in the State of Delaware. On June 2, 2021, ACI acquired all of the issued and outstanding capital stock or other equity securities of 1 Stop Electronics Center, Inc., a New York corporation (“1 Stop”), Gold Coast Appliances, Inc., a New York corporation (“Gold Coast”), Superior Deals Inc., a New York corporation (“Superior Deals”), Joe’s Appliances LLC, a New York limited liability company (“Joe’s Appliances”) and YF Logistics LLC, a New Jersey limited liability company (“YF Logistics,” and collectively with 1 Stop, Gold Coast, Superior Deals, and Joe’s Appliances, “Appliances Connection”). See Note 9. The Company operates a technology-driven e-commerce platform for appliances, furniture, home goods and related products. Since its founding in 1951, the Company has evolved from a local brick and mortar operation serving the St. Louis metro area to a nationwide omni-channel retailer offering the largest online selection of household appliances across all major appliance brands with competitive pricing. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The unaudited condensed consolidated financial statements of the Company and its consolidated subsidiaries have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and with the instructions to Article 8 of Regulation S-X. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2020. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiaries, ACI, 1 Stop, Gold Coast, Superior Deals, Joe’s Appliances and YF Logistics. All significant intercompany balances and transactions have been eliminated in consolidation. The Company does not have a majority or minority interest in any other company, either consolidated or unconsolidated. Stock Split On July 30, 2020, the Company completed a 4,750-for-1 forward stock split of its outstanding common stock. As a result of this stock split, the Company’s issued and outstanding common stock increased from 1,000 to 4,750,000 shares. Accordingly, all share and per share information has been restated to retroactively show the effect of this stock split. Use of Estimates The preparation of these unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and equivalents include: (1) currency on hand, (2) demand deposits with banks or financial institutions, (3) other kinds of accounts that have the general characteristics of demand deposits, and (4) short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. The majority of payments due from financial institutions for the settlement of credit card and debit card transactions process within two business days and are, therefore, classified as cash and cash equivalents. Other payment methods that take more time to settle are classified as receivables. At June 30, 2021, restricted cash includes approximately $300,000 to secure vendor letters of credit and $8,085,848 withheld by credit card processors as security for the Company’s customer refund claims and credit card chargebacks. Cash pledged to secure the letter of credit will be released when the vendor offers the Company credit terms, and the cash held by credit card processors will be released at the discretion of the credit card companies. Revenue Recognition and Cost of Revenue The Company records revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606. Revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASC 606 also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer purchase orders, including significant judgments. The Company’s performance obligation is to deliver the customer’s order. Each customer order generally contains only one performance obligation based on the merchandise sale to be delivered, at which time revenue is recognized. Control of the delivery transfers to customers when the customer can direct the use of, and obtain substantially all the benefits from, the Company’s products, which generally occurs when the customer assumes the risk of loss. The risk of loss shifts to the customer at different times depending on the method of delivery. The Company delivers products to its customers in three possible ways. The first way is through a shipment of the products through a third-party carrier from the Company’s warehouse to the customer (a “Company Shipment”). The second way is through a shipment of the products through a third-party carrier from a warehouse other than the Company’s warehouse to the customer (a “Drop Shipment”) and the third way is where the Company itself delivers the products to the customer and often also installs the product (a “Local Delivery”). In the case of a Local Delivery, the Company loads the product on to its own truck and delivers and installs the product at the customer’s location. When a product is delivered through a Local Delivery, risk of loss passes to the customer at the time of installation and revenue is recognized upon installation at the customer’s location. In the case of a Company Shipment and a Drop Shipment, the delivery to the customer is made free on board, or FOB, shipping point (whether from the Company’s warehouse or a third party’s warehouse). Therefore, risk of loss and title transfers to the customer once the products are shipped (i.e., leaves the Company’s warehouse or a third-party’s warehouse). After shipment and prior to delivery, the customer is able to redirect the product to a different destination, which demonstrates the customer’s control over the product once shipped. Once the risk of loss has shifted to the customer, the Company has satisfied its performance obligation and the Company recognizes revenue. The Company agrees with customers on the selling price of each transaction. This transaction price is generally based on the agreed upon sales price. In the Company’s contracts with customers, it allocates the entire transaction price to the sales price, which is the basis for the determination of the relative standalone selling price allocated to each performance obligation. Any sales tax, value added tax, and other tax the Company collects concurrently with revenue-producing activities are excluded from revenue. Cost of revenue includes the cost of purchased merchandise plus the cost of shipping merchandise and where applicable installation, net of promotional rebates and other incentives received from vendors. Substantially all the Company’s sales are to individual retail consumers (homeowners), builders and designers. Shipping and Handling ‒ The Company bills its customers for shipping and handling charges, which are included in net sales for the applicable period, and the corresponding shipping and handling expense is reported in cost of sales. Disaggregated Revenue The Company’s disaggregated revenue by product type is as follows: Three Months Ended Six Months Ended 2021 2020 2021 2020 Appliance sales $ 56,202,115 $ 11,533,006 $ 66,387,297 $ 19,335,110 Furniture sales 6,172,784 2,768,327 8,487,474 4,050,163 Other sales 1,697,199 983,698 2,894,695 1,576,936 Total $ 64,072,098 $ 15,285,031 $ 77,769,466 $ 24,962,209 The Company also sells extended warranty contracts. The Company is an agent for the warranty company and earns a commission on the warranty contracts purchased by customers; therefore, the cost of the warranty contracts is netted against warranty revenue in the accompanying consolidated statement of operations. The Company assumes no liability for repairs to products on which it has sold a warranty contract. Receivables Receivables consists of customer’s balance payments for which the Company extends credit to certain homebuilders and designers based on prior business relationship, and vendor rebate receivables. Vendor rebates receivable represent amounts due from manufactures from whom the Company purchases products. Rebates receivable are stated at the amount that management expects to collect from manufacturers (vendors). Rebates are calculated on product and model sales programs from specific vendors. The rebates are paid at intermittent periods either in cash or through issuance of vendor credit memos, which can be applied against vendor accounts payable. Based on the Company’s assessment of the credit history with its manufacturers, it has concluded that there should be no allowance for uncollectible accounts. The Company historically collects substantially all its trade receivables from customers and bad debt expense has been historically immaterial to the combined financial statements. Uncollectible balances are expensed in the period it is determined to be uncollectible. The Company had no significant concentrations of receivables balances as of June 30, 2021 Merchandise Inventory Inventory consists of finished products acquired for resale and is valued at the lower-of-cost-or-market with cost determined on an average item basis. The Company periodically evaluates the value of items in inventory and provides write-downs to inventory based on its estimate of market conditions. Property and Equipment Property and equipment is stated at the historical cost. Maintenance and repairs of property and equipment are charged to operations as incurred. Leasehold improvements are amortized over the lesser of the base term of the lease or estimated life of the leasehold improvements. Depreciation is computed using the straight-line method over estimated useful lives as follows: Category Useful Life (Years) Furniture and fixtures 7 Machinery and equipment 5-7 Office equipment 5-7 Transportation equipment 5 Goodwill The Company tests its goodwill for impairment at least annually on December 31 and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company’s expected future cash flows; a significant adverse change in legal factors or in the business climate; unanticipated competition; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and the Company’s consolidated financial results. The Company tests goodwill by estimating fair value using a Discounted Cash Flow (“DCF”) model. The key assumptions used in the DCF model to determine the highest and best use of estimated future cash flows include revenue growth rates and profit margins based on internal forecasts, terminal value and an estimate of a market participant’s weighted-average cost of capital used to discount future cash flows to their present value. There were no impairment charges during three and six months ended June 30, 2021 and 2020. Intangible Assets As of June 30, 2021 and December 31, 2020, definite-lived intangible assets primarily consisted of tradenames and customer relationships which are being amortized over their estimated useful lives, or 5 years. The Company periodically evaluates the reasonableness of the useful lives of these assets. Once these assets are fully amortized, they are removed from the accounts. These assets are reviewed for impairment or obsolescence when events or changes in circumstances indicate that the carrying amount may not be recoverable. If impaired, intangible assets are written down to fair value based on discounted cash flows or other valuation techniques. The Company has no intangibles with indefinite lives. In applying the acquisition method of accounting, amounts assigned to identifiable assets and liabilities acquired were based on estimated fair values as of the date of acquisition, with the remainder recorded as goodwill. Identifiable intangible assets are initially valued at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Identifiable intangible assets with definite lives are amortized over their estimated useful lives and are reviewed for impairment if indicators of impairment arise. Intangible assets with indefinite lives are tested for impairment within one year of acquisitions or annually as of December 1, and whenever indicators of impairment exist. The fair values of intangible assets are compared against their carrying values, and an impairment loss would be recognized for the amount by which a carrying amount exceeds its fair value. Impairments for the three and six months ended June 30, 2021 were $1,437,042 due to an abandonment of certain right of use assets. There were no impairments for the six months ended June 30, 2020. Long-Lived Assets The Company reviews its property and equipment and any identifiable intangibles (including right of use assets) for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The test for impairment is required to be performed by management upon triggering events. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. Impairments for the three and six months ended June 30, 2021 were $1,437,042 due to an abandonment of certain right of use assets and the respective leasehold improvements. There were no impairments for the six months ended June 30, 2020. Lease Liabilities Lease liabilities and their corresponding right of use assets are recorded based on the present value of lease payments over the expected lease term at the lease commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate (“IBR”) based on the information available at the commencement date of the respective lease to determine the present value of future payments. The determination of the IBR requires judgment and is primarily based on publicly available information for companies within the same industry and with similar credit profiles. The Company adjusts the rate for the impact of collateralization, the lease term and other specific terms included in each lease arrangement. The IBR is determined at the lease commencement and is subsequently reassessed upon a modification to the lease arrangement. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company reviews the right of use asset for impairment whenever events or changes in circumstances indicate that the carrying amount of the right of use asset may not be recoverable. When such events occur, the Company compares the carrying amount of the right of use asset to the undiscounted expected future cash flows related to the right of use asset. If the comparison indicates that an impairment exists, the amount of the impairment is calculated as the difference between the excess of the carrying amount over the fair value of the right of use asset. If a readily determinable market price does not exist, fair value is estimated using discounted expected cash flows attributable to the right of use asset. Fair Value of Financial Instruments The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Cash, restricted cash, receivables, inventory, and prepaid expenses approximate fair value, due to their short-term nature. The fair value hierarchy is defined in the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. Customer Deposits Customer deposits represent the amount collected from customers when an order is placed. The deposits are transferred to revenue when the order ships to the customer or returned to the customer if the order is subsequently cancelled. Income Taxes Under the Company’s accounting policies, the Company initially recognizes a tax position in its unaudited condensed consolidated financial statements when it becomes more likely than not that the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the largest amount of tax positions that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authorities assuming full knowledge of the position and all relevant facts. Although the Company believes its provisions for unrecognized tax positions are reasonable, the Company can make no assurance that the final tax outcome of these matters will not be different from that which the Company has reflected in its income tax provisions and accruals. The tax law is subject to varied interpretations, and the Company has taken positions related to certain matters where the law is subject to interpretation. Such differences could have a material impact on the Company’s income tax provisions and operating results in the period(s) in which the Company makes such determination. In the second quarter of 2021, the Company acquired Appliances Connection. Appliances Connection has a history of profitable operations. As such, the Company determined that it was more likely than not that it would have profitable operations in the future and therefore be able to realize the deferred tax assets and accordingly reversed the allowance for deferred tax assets at June 30, 2021. Sales Tax Liability On June 21, 2018, the U.S. Supreme Court issued an opinion in South Dakota v. Wayfair, Inc., 138 S. Ct. 2080 (2018) Quill Corp v. North Dakota As of June 30, 2021, only one state has notified the Company of a potential sales tax liability of approximately $82,000, all of which was previously accrued. Income (Loss) Per Share Basic income (loss) per share is calculated by dividing the net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive securities. For the three and six months ended June 30, 2021, the potentially dilutive securities were warrants for the purchase of 455,560 shares of common stock and options for the purchase of 555,000 shares of common stock. The potentially dilutive securities for the three and six months ended June 30, 2020 were warrants for the purchase of 250,000 shares of common stock. These potentially dilutive securities were excluded from diluted loss per share. Reclassifications Certain accounts have been reclassified to conform with classifications adopted in the period ended June 30, 2021. Such reclassifications had no effect on net earnings or financial position. Impact of COVID-19 In December 2019, a novel strain of coronavirus (“COVID-19”) emerged in China. On March 11, 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic. The extent of the COVID-19 pandemic’s continued effect on the Company’s operational and financial performance and those of third parties on which the Company relies will depend on future developments, including the effectiveness of vaccines and other treatments for COVID-19, and other new information that may emerge concerning the severity of the pandemic and steps taken to contain the pandemic or treat its impact, among others. The ultimate impact of the COVID-19 pandemic is highly uncertain and subject to change. The Company does not yet know the full extent of potential impacts on its business and financing. However, these effects could have a material impact on the Company’s liquidity, capital resources, operations and business and those of the third parties on which the Company relies. Going Concern Assessment Management assesses going concern uncertainty in the Company’s unaudited condensed consolidated financial statements to determine whether there is sufficient cash on hand and working capital, including available borrowings on loans, to operate for a period of at least one year from the date the unaudited condensed consolidated financial statements are issued or available to be issued, which is referred to as the “look-forward period”, as defined in GAAP. As part of this assessment, based on conditions that are known and reasonably knowable to management, management will consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including the timing and nature of projected cash expenditures or programs, its ability to delay or curtail expenditures or programs and its ability to raise additional capital, if necessary, among other factors. Based on this assessment, as necessary or applicable, management makes certain assumptions around implementing curtailments or delays in the nature and timing of programs and expenditures to the extent it deems probable those implementations can be achieved and management has the proper authority to execute them within the look-forward period. For the six months ended June 30, 2021, the Company incurred operating losses of approximately $4,543,516 and negative cash flow from operations of $6,985,302, but had working capital of $15,530,879. Additionally, the Company had over $45 million of unrestricted cash at June 30, 2021. On June 2, 2021, the Company closed on the acquisition of Appliances Connection. Appliances Connection has historically been profitable, however, only 29 days of their operations are included in results for the three and six months of 2021. Management has prepared estimates of operations for fiscal years 2021 and 2022 and believes that sufficient funds will be generated from operations to fund its operations, and to service its debt obligations for one year from the date of the filing of these unaudited condensed consolidated financial statements. Additionally, only one month of operations for Appliances Connection, which has operated profitably, are included in the results of operations for the six months ended June 30, 2021. The impact of COVID-19 on the Company’s business has been considered in these assumptions; however, it is too early to know the full impact of COVID-19 or its timing on a return to more normal operations. The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize its assets and satisfy its liabilities in the normal course of business. Management believes that based on relevant conditions and events that are known and reasonably knowable that its forecasts, for one year from the date of the filing of these unaudited condensed consolidated financial statements, indicate improved operations and the Company’s ability to continue operations as a going concern. Recent Accounting Pronouncements Recently Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement Not Yet Adopted In June 2016, the FASB issued ASU 2016-13 Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The Company currently believes that all other issued and not yet effective accounting standards are not relevant to the Company’s unaudited condensed consolidated financial statements. |
Receivables
Receivables | 6 Months Ended |
Jun. 30, 2021 | |
Receivables [Abstract] | |
RECEIVABLES | NOTE 3—RECEIVABLES At June 30, 2021 and December 31, 2020, receivables consisted of the following: June 30, December 31, Trade receivables from customers $ 11,858,185 $ - Vendor rebates receivable 5,486,634 1,337,791 Credit cards in process of collection 189,207 660,441 Other receivables 3,732,761 - Total receivables $ 21,266,787 $ 1,998,232 |
Merchandise Inventory
Merchandise Inventory | 6 Months Ended |
Jun. 30, 2021 | |
Inventory Disclosure [Abstract] | |
MERCHANDISE INVENTORY | NOTE 4—MERCHANDISE INVENTORY At June 30, 2021 and December 31, 2020, the inventory balances are composed of: June 30, December 31, Appliances $ 19,974,548 $ 5,285,975 Furniture 486,207 194,852 Other 1,098,268 91,414 Total merchandise inventory 21,559,023 5,572,241 Allowance for inventory obsolescence (425,000 ) (425,000 ) Merchandise inventory, net $ 21,134,023 $ 5,147,241 |
Vendor Deposits
Vendor Deposits | 6 Months Ended |
Jun. 30, 2021 | |
Vendor Deposits Disclosure [Abstract] | |
VENDOR DEPOSITS | NOTE 5—VENDOR DEPOSITS Deposits with vendors represent cash on deposit with one vendor arising from accumulated rebates paid by the vendor. The deposits are used by the vendor to seek to secure the Company’s purchases. The deposit can be withdrawn at any time up to the amount of the Company’s credit line with the vendor. Alternatively, the Company could secure their credit line with a floor plan line from a lender and withdraw all its deposits. The Company has elected to leave the deposits with the vendor on which it earns interest income. Prior to obtaining an open line of credit with a major vendor, the Company paid in advance for its purchases. The vendor did not ship product to the Company until an order was complete. As a result, the vendor held Company funds. A second vendor uses the Company’s vendor deposit account as collateral. Orders from this vendor exceeded the deposit account and the Company prepaid for some orders. Vendor deposits as of June 30, 2021 and December 31, 2020 were $10,755,209 and $547,648, respectively. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 6—PROPERTY AND EQUIPMENT Property and equipment consist of the following at June 30, 2021 and December 31, 2020: June 30, December 31, Equipment $ 69,336 $ 69,336 Warehouse equipment 374,448 61,070 Furniture and fixtures 8,434 512 Transportation equipment 1,417,047 63,784 Leasehold improvements 216,405 136,931 Construction in progress 509,428 - Total property and equipment 2,595,098 331,633 Accumulated depreciation (115,043 ) (85,685 ) Property and equipment, net $ 2,480,055 $ 245,948 Depreciation expense for the six months ended June 30, 2021 and 2020 was $85,777 and $21,864, respectively. All property and equipment are pledged to secure the Loans described below (See Note 10). On June 30, 2021, the Company closed its old warehouse and retail showroom in anticipation of relocating to a new facility. Accordingly, the Company wrote the remaining right of use asset and related leasehold improvements as of that date. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | NOTE 7—INTANGIBLE ASSETS AND GOODWILL The following provides a breakdown of identifiable intangible assets as of June 30, 2021 and December 31, 2020: June 30, December 31, Customer relationships $ 749,000 $ 749,000 Marketing related - tradename 1,368,000 1,368,000 Total intangible assets 2,117,000 2,117,000 Accumulated amortization (946,761 ) (735,063 ) Intangible assets, net $ 1,170,239 $ 1,381,937 In connection with the acquisition of Goedeker, the Company identified intangible assets of $2,117,000, representing trade names and customer relationships. These assets are being amortized on a straight-line basis over their weighted average estimated useful life of 2.75 years. Amortization expense for the three months ended June 30, 2021 and 2020 was $10,849 and $80,883, respectively. For the six months ended June 30, 2021 and 2020 amortization expense was $211,698 and $161,766, respectively. As of June 30, 2021, the estimated annual amortization expense for each of the next five years is as follows: 2021 (remainder of year) $ 211,698 2022 423,396 2023 423,396 2024 111,749 Total $ 1,170,239 Following is a summary of goodwill: Balance December 31, 2020 $ 4,725,689 Preliminary goodwill from acquisition of Appliances Connection 217,382,100 Balance June 30, 2021 $ 222,107,789 |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 6 Months Ended |
Jun. 30, 2021 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 8—ACCOUNTS PAYABLE AND ACCRUED EXPENSES The following is schedule of accounts payable and accrued expenses at June 30, 2021 and December 31, 2020: June 30, December 31, Trade accounts payable $ 23,939,457 $ 5,975,486 Sales tax 17,947,165 5,804,100 Accrued payroll liabilities 786,407 492,573 Accrued interest 199,340 10,000 Accrued liability for sales returns 200,000 200,000 Other accrued liabilities 8,825,297 219,556 Total accounts payable and accrued expenses $ 51,897,666 $ 12,701,715 |
Business Combination
Business Combination | 6 Months Ended |
Jun. 30, 2021 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATION | NOTE 9—BUSINESS COMBINATION On October 20, 2020, the Company entered into a securities purchase agreement, which was amended on December 8, 2020 and April 6, 2021 (as amended, the “Purchase Agreement”), with ACI, Appliances Connection and the sellers set forth on Exhibit A thereto (the “Sellers”), pursuant to which ACI agreed to acquire all of the issued and outstanding capital stock or other equity securities of Appliances Connection from the Sellers (the “Acquisition”). The Acquisition was completed on June 2, 2021. The aggregate purchase price is $222,000,000 (subject to adjustment), consisting of (i) $180,000,000 in cash (subject to adjustment), (ii) 2,333,333 shares of the Company’s common stock having a stated value that is equal to $21,000,000 and (iii) 3,562,640 shares of the Company’s common stock, which is equal to (A) $21,000,000 divided by (B) the average of the closing price of the Company’s common stock (as reported on NYSE American) for the 20 trading days immediately preceding the 3rd trading day prior to the closing date of the Acquisition. The purchase price was subject to a closing net working capital adjustment provision. Under this provision, the Sellers delivered to ACI a statement setting forth their good faith estimate of the net working capital of Appliances Connection (which excludes accruals for sales tax liabilities). If such estimated net working capital exceeded a target net working capital of ($15,476,941), then ACI was required to make a cash payment to the Sellers that is equal to such excess. If such target net working capital exceeded such estimated net working capital, then the Sellers were required make a cash payment to ACI that is equal to such excess. Upon execution of the Purchase Agreement, ACI paid a deposit in the amount of $100,000, and upon execution of the first amendment to Purchase Agreement, ACI paid an additional deposit in the amount of $75,000, all of which was credited towards the cash portion of the purchase price at closing. As a result of these adjustments, the cash portion of the purchase price paid was $212,597,483. The purchase price is also subject to a post-closing net working capital adjustment provision. On or before the 75th day following the closing of the Acquisition, ACI shall deliver to the Sellers a statement setting forth its calculation of the net working capital (as defined in the Purchase Agreement). If such net working capital exceeds the estimated net working capital described above, then within five (5) days after the final determination of such net working capital ACI shall send payment by wire transfer of immediately available funds to the Sellers in an amount equal to such excess. If the estimated net working capital exceeds such net working capital, then within five (5) days the Sellers shall pay to ACI in cash an amount equal to such excess. The Company accounted for the Acquisition using the acquisition method of accounting in accordance with FASB ASC Topic 805 “Business Combinations”. In accordance with ASC 805, we used our best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. The fair value of the purchase consideration issued to Appliances Connection was allocated to the net tangible assets acquired. The Company accounted for the Acquisition as the purchase of a business under GAAP under the acquisition method of accounting, and the assets and liabilities acquired were recorded as of the acquisition date, at their respective fair values and consolidated with those of the Company. The preliminary fair value of the net assets to be acquired is $7,479,007. The excess of the aggregate estimated fair value of the net tangible assets, $217,382,100, has been allocated to provisional goodwill. The table below represents the estimated preliminary purchase price allocation to the net assets acquired, as well as the associated estimated useful lives of the acquired intangible assets. Provisional purchase consideration at preliminary fair value: Cash consideration $ 180,000,000 Share issuance 12,263,624 Working capital adjustment paid to sellers 24,060,458 Working capital adjustment payable to sellers 8,537,025 Amount of consideration $ 224,861,107 Assets acquired and liabilities assumed at preliminary fair value Cash $ 6,437,220 Accounts receivable 19,744,368 Inventories 18,300,781 Vendor deposits 15,000,000 Other assets 2,194,384 Property and equipment 1,890,968 Right of use operating lease assets 1,833,899 Accounts payable and accrued expenses (43,673,578 ) Customer deposits (10,673,600 ) Finance lease obligation (215,008 ) Operating lease liability (1,833,899 ) Current portion of notes payable (458,913 ) Long term portion of notes payable (1,067,615 ) Net tangible assets acquired $ 7,479,007 Total net assets acquired $ 7,479,007 Consideration paid 224,861,107 Preliminary goodwill $ 217,382,100 Pro forma 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 Acquisition been completed as of January 1, 2020, or to project potential operating results as of any future date or for any future periods. Appliances Connection’s revenue and net income for the three and six months ended June 30, 2021 included in the consolidated statement of operations amounted to approximately $47,780,835 and $4,872,936, respectively. Three Months Ended Six Months Ended 2021 2020 2021 2020 Product sales, net $ 140,128,696 $ 91,490,100 $ 263,086,153 $ 158,241,719 Net income $ 17,288,674 $ 799,593 $ 32,898,194 $ 3,443,584 Basic earnings per share $ 0.16 $ 0.01 $ 0.31 $ 0.03 Diluted earnings per share (a) $ 0.16 $ 0.01 $ 0.31 $ 0.03 Basic number of shares 105,335,084 105,335,084 105,335,084 105,335,084 Diluted number of shares 105,335,084 105,335,084 105,335,084 105,335,084 (a) Assumes shares outstanding at offering were outstanding for all periods and that warrant price is equal to the offering price resulting in no diluted shares. The Company believes that as a result of the Appliances Connection acquisition, it acquired identified intangible assets which will reduce goodwill. The nature and amount of intangible assets acquired will be determined by a valuation report, but the amount of any intangible assets will create an additional deferred tax liability increasing the amount of goodwill as there is no tax basis in goodwill or intangible assets. |
Notes Payable
Notes Payable | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTE 10—NOTES PAYABLE Credit Facilities On June 2, 2021, the Company and ACI, as borrowers, entered into a credit and guaranty agreement (the “Credit Agreement”) with Appliances Connection and certain other subsidiaries of the Company party thereto from time to time as guarantors (the “Guarantors”), the financial institutions party thereto from time to time (“Lenders”), and Manufacturers and Traders Trust Company, as sole lead arranger, sole book runner, administrative agent and collateral agent (“M&T), pursuant to which the Lenders have agreed to make available to the Company and ACI senior secured credit facilities in the aggregate initial amount of $70,000,000, including (i) a $60,000,000 term loan (the “Term Loan”) and (ii) a $10,000,000 revolving credit facility (the “Revolving Loan”), which revolving credit facility includes a $2,000,000 swingline subfacility (the “Swing Line Loan” and together with the Term Loan and the Revolving Loan, the “Loans”) and a $2,000,000 letter of credit subfacility, in each case, on the terms and conditions contained in the Credit Agreement. On June 2, 2021, the Company borrowed the entire amount of the Term Loan and issued term loan notes to the Lenders in the aggregate principal amount of $60,000,000. As of June 30, 2021, the Company has not made any loans under the Revolving Loan. As of June 30, 2021, the outstanding balance of the Term Loan is $56,311,521, comprised of principal of $60,000,000, net of unamortized loan costs of $3,688,479. Loan costs before amortization include $3,500,000 of lender and placement agent fees and $250,995 of legal other fees. The Company classified $6,000,000 as a current liability and the balance as a long-term liability. Each of the Loans matures on June 2, 2026. The Loans will bear interest on the unpaid principal amount thereof as follows: (i) if it is a Loan bearing interest at a rate determined by the Base Rate (as defined in the Credit Agreement), then at the Base Rate plus the Applicable Margin (as defined in the Credit Agreement) for such Loan; (ii) if it is a Loan bearing interest at a rate determined by the LIBOR Rate (as defined in the Credit Agreement), then at the LIBOR Rate plus the Applicable Margin for such Loan; and (iii) if it is a Swing Line Loan, then at the rate applicable to Loans bearing interest at a rate determined by the Base Rate. The Term Loan initially bears interest at the LIBOR Rate plus Applicable Margin (3.9%), with an initial interest period of six months. The Company may elect to continue or convert the existing interest rate benchmark for the Term Loan from LIBOR Rate to Base Rate, and may elect the interest rate benchmark for future Revolving Loans as either LIBOR Rate or Base Rate (and, with respect to any Loan made at the LIBOR Rate, may also select the interest period applicable to any such Loan), by notifying M&T and Lenders from time to time in accordance with the provisions of the Credit Agreement. Notwithstanding the foregoing, following an event of default, the Loans will bear interest at a rate that is 2% per annum higher than the interest rate then in effect for the applicable Loan. The Company must repay the principal amount of the Term Loan in quarterly installments of $1,500,000 each, payable on the last business day of each March, June, September and December, commencing on September 30, 2021. The remaining unpaid principal amount of the Term Loan must be repaid on the maturity date, unless payment is sooner required by the Credit Agreement. Mandatory repayments of amounts borrowed under the Revolving Loan facility are required only if the amount borrowed at any time exceeds the commitment amount. Amounts borrowed under Revolving Loans may be repaid and reborrowed at any time until the maturity date. The Company may voluntarily prepay the Loans from time to time in accordance with the provisions of the Credit Agreement, and will be required to prepay the Loans under certain limited circumstances as set forth in the Credit Agreement, including upon receipt of cash proceeds in connection with certain specified asset sales, receipt of insurance or condemnation proceeds or other cash proceeds received other than in the ordinary course of business or upon receipt of cash proceeds from the incurrence of indebtedness that is not permitted under the Credit Agreement, all as more specifically set forth in the Credit Agreement. Under the Credit Agreement, the Company is required to pay certain fees to M&T, including a commitment fee of up to 0.5% per annum with respect to the unused portion of the Lenders’ revolving loan commitments, determined as set forth in the Credit Agreement, and certain fees in connection with the issuance of any letters of credit under the Credit Agreement. The Credit Agreement contains customary representations, warranties, affirmative and negative financial and other covenants, including leverage ratio and fixed charge coverage ratios, and events of default for loans of this type. The Loans are guaranteed by the Guarantors and are secured by a first priority security interest in substantially all of the assets of the Company, ACI and the Guarantors. Maturities of the Term Loan are as follows: For the years ended December 31, Amount 2021 (remainder of year) $ 3,000,000 2022 6,000,000 2023 6,000,000 2024 6,000,000 2025 6,000,000 Thereafter 33,000,000 Total 60,000,000 Less: Loan costs (3,688,479 ) Total $ 56,311,521 Amount classified as a current liability $ 6,000,000 Amount classified as long-term liability $ 50,311,521 Northpoint Loan On June 3, 2021, the Company entered into a loan and security agreement with Northpoint Commercial Finance LLC (“Northpoint”), pursuant to which Northpoint may from time to time advance funds for the acquisition, financing and/or refinancing by the Company of inventory purchased from Samsung Electronics America, Inc. and/or affiliates and for such other purposes as are acceptable Northpoint. The loan and security agreement provides that Northpoint may establish a credit limit and may adjust such credit limit from time to time; provided that such credit limit does not constitute a commitment or committed line of credit Northpoint. As of June 30, 2021, such credit limit is $1,000,000 and the Company has not borrowed any funds. The applicable per annum interest rates for a loan, including any default rates, will be determined at the time of the loan. The loan and security agreement contains customary events of default and is secured by a security interest in all of the Company’s inventory (i) that is manufactured, distributed, or sold by Samsung Electronics America, Inc. and/or its affiliates and/or (ii) that bears any trade names, trademarks, or logos of Samsung Electronics America, Inc. and/or its affiliates; all returns, repossessions, exchanges, substitutions, replacements, attachments, parts, accessories and accessions of any of the foregoing; all price protection payments, discounts, rebates, credits, factory holdbacks and incentive payments related to any of the foregoing; supporting obligations to any of the foregoing; and products and proceeds in whatever form of any of the foregoing. Arvest Loan On August 25, 2020, the Company entered into a promissory note and security agreement with Arvest Bank for a loan in the principal amount of $3,500,000. As of December 31, 2020, the outstanding balance of this loan is $3,185,369 comprised of principal of $3,283,628, net of unamortized loan costs of $98,259. On May 10, 2021, the Company repaid this loan by transferring principal and accrued interest from the restricted cash account. 10% OID Senior Promissory Notes On March 19, 2021, the Company entered into a securities purchase agreement with two institutional investors, pursuant to which the Company issued to each investor (i) a 10% OID senior secured promissory note in the principal amount of $2,750,000 and (ii) a four-year warrant to purchase 200,000 shares of the Company’s common stock at an exercise price of $12.00, subject to adjustments, which may be exercised on a cashless basis, for a purchase price of $2,500,000 each, or $5,000,000 in the aggregate, the relative fair value of which is $1,340,438 and was recorded as debt discount. After deducting a placement fee and other expenses, the Company received net proceeds of $4,590,000. The original issue discount and warrant expense were amortized as interest expense. On June 2, 2021, the Company repaid these notes in full from the proceeds of the Term Loan. At the time of repayment, the Company wrote off the balance of the debt discount, $1,653,048, as a loss on early extinguishment of debt. Vehicle Loans Appliances Connection has financed purchases of transportation vehicles with notes payable which are secured by the vehicles purchased. These notes have five-year terms and interest rates ranging from 3.59% to 5.74%. As of June 30, 2021, the outstanding balance of these notes is $1,488,620. Following is a summary of payments due for the succeeding five years: For the years ended December 31, Amount 2021 (remainder of year) $ 246,761 2022 396,848 2023 363,842 2024 311,979 2025 169,190 Thereafter - Total $ 1,488,620 Amount classified as a current liability $ 455,272 Amount classified as a long-term liability $ 1,033,348 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2021 | |
ASU 2016-02 Transition [Abstract] | |
LEASES | NOTE 11—LEASES Financing Leases Appliances connection has three finance leases for the acquisition of forklifts. At June 30, 2021, the total amount due on these leases was $210,809. The Following is a summary of payments due on financing leases for the succeeding five years: For the years ended December 31, Amount 2021 (remainder of year) $ 36,528 2022 66,284 2023 52,644 2024 35,688 2025 and thereafter 48,960 Total payments 240,104 Less: amount representing interest (29,295 ) Present value of minimum lease payments $ 210,809 Operating Leases On April 5, 2019, the Company entered into a lease agreement with S.H.J., L.L.C for its prior principal office in Ballwin, Missouri. The lease is for a term five (5) years and provides for a base rent of $45,000 per month. In addition, the Company is responsible for all taxes and insurance premiums during the lease term. The lease contains customary events of default. On January 13, 2021, the Company entered into a lease agreement with Westgate 200, LLC, which was amended on March 31, 2021, for its new principal office and showroom in St. Charles, Missouri. The lease terminates on April 30, 2027, with two (2) options to renew for additional five (5) year periods. The base rent is $20,977 per month until September 30, 2021, and increases to $31,465 per month until April 30, 2022, after which time the base rent increases at approximately 2.5% per year thereafter. The Company must also pay its 43.4% pro rata portion of the property taxes, operating expenses and insurance costs and is also responsible to pay for the utilities used on the premises. The lease contains customary events of default. In connection with the new lease, the Company recorded a right of use asset and liability of $1,954,022 representing the initial present value of future lease payments. On June 2, 2021, 1 Stop entered into a new lease agreement with 1870 Bath Ave. LLC, a related party, for the premises located at 1870 Bath Avenue, Brooklyn, NY. The lease is for a term of ten (10) years and provides for a base rent of $74,263 per month during the first year with annual increases to $96,896 during the last year of the term. 1 Stop is also responsible for all property taxes, insurance costs and the utilities used on the premises. The lease contains customary events of default. This lease replaces the prior lease entered into between the parties on September 1, 2018. The initial right of use asset and liability associated with this lease is $8,430,959. On June 2, 2021, Joe’s Appliances entered into a new lease agreement with 812 5th Ave Realty LLC, a related party, for the premises located at 7812 5th Avenue, Brooklyn, NY. The lease is for a term of ten (10) years and provides for a base rent of $6,365 per month during the first year with annual increases to $8,305 during the last year of the term. Joe’s Appliances is also responsible for all property taxes, insurance costs and the utilities used on the premises. The lease contains customary events of default. This lease replaces the prior lease entered into between the parties on September 1, 2018. The initial right of use asset and liability associated with this lease is $723,074. On May 31, 2019, YF Logistics entered into a sublease agreement with Dynamic Marketing, Inc. (“DMI”) for its warehouse space in Hamilton, NJ. The initial term of the sublease was for a period commencing on June 1, 2019 and terminating on April 30, 2020, with automatic renewals for successive one year terms until the earlier of (i) termination by either upon thirty (30) days’ prior written notice or (ii) April 30, 2024. The sublease provides for a base rent equal to 71.43% of the base rent paid by DMI under its lease for the premises, plus 71.43% of any taxes, operating expenses, additional charges or any other amounts due by DMI, for a total of $56,250 per month. The initial right of use asset and liability associated with this lease is $3,007,661. During the three and six months ended June 20, 2021, the Company accrued rent expense of $62,386 and $721,959, respectively. During the three and six months ended June 30, 2020, rent expense was $461,401 and $671,135, respectively. Supplemental balance sheet information related to leases at June 30, 2021 was as follows: Operating lease right-of-use assets $ 12,822,972 Lease liabilities, current portion $ 2,157,010 Lease liabilities, long-term 12,149,107 Total operating lease liabilities $ 14,306,117 Weighted average remaining lease term (months) 100 Weighted average discount rate 4.2 % Maturities of the lease liabilities for each of the next five years is as follows: 2021 (remainder of year) $ 1,167,967 2022 2,580,999 2023 2,620,008 2024 1,805,142 2025 1,486,525 Thereafter 7,065,391 Total lease payments $ 16,726,032 Less imputed interest (2,419,915 ) Total lease liability $ 14,306,117 On June 30, 2021, the Company closed its old warehouse and retail showroom in anticipation of relocating to a new facility. Accordingly, the Company wrote-off the remaining right of use asset and related leasehold improvements as of that date. |
Supplier Concentration
Supplier Concentration | 6 Months Ended |
Jun. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
SUPPLIER CONCENTRATION | NOTE 12—SUPPLIER CONCENTRATION Significant customers and suppliers are those that account for greater than ten percent of the Company’s revenues and purchases. For the three and six months ended June 30, 2021, the Company purchased a substantial portion of finished goods from DMI, 55% and 60%, respectively. The Company believes there are numerous other suppliers that could be substituted should the supplier become unavailable or non-competitive. |
Related Parties
Related Parties | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES | NOTE 13—RELATED PARTIES Management Services Agreement On April 5, 2019, the Company entered into a management services agreement with 1847 Partners LLC (the “Manager”), a company owned and controlled by Ellery W. Roberts, the Company’s chairman and prior significant stockholder, which was amended effective on August 4, 2020. Pursuant to the offsetting management services agreement, as amended, the Company appointed the Manager to provide certain services to it for a quarterly management fee equal to $62,500; provided, however, that under certain circumstances specified in the management services agreement, the quarterly fee may be reduced if similar fees payable to the Manager by subsidiaries of the Company’s former parent company, 1847 Holdings LLC, exceed a threshold amount. The Company shall also reimburse the Manager for all costs and expenses of the Company which are specifically approved by the board of directors of the Company, including all out-of-pocket costs and expenses, that are actually incurred by the Manager or its affiliates on behalf of the Company in connection with performing services under the management services agreement. The Company did not pay any expenses for the three and six months ended June 30, 2021 and 2020. The Company expensed management fees of $62,500 for the three months ended June 30, 2021 and 2020 and $125,000 for the six months ended June 30, 2021 and 2020. DMI The Company is a member of DMI, an appliance purchasing cooperative. DMI purchases consumer electronics and appliances at wholesale prices from various vendors, and then makes such products available to its members, including the Company, who sell such products to end consumers. DMI’s purchasing group arrangement provides its members, including the Company, with leverage and purchasing power with appliance vendors, and increases the Company’s ability to compete with competitors, including big box appliance and electronics retailers. The Company owns an approximate 5% interest in the cooperative. Additionally, Albert Fouerti, who is a member of the Company’s board of directors, is the president of ACI and Appliances Connection, and a former significant stockholder of Appliances Connection prior to the Acquisition, is on the board of DMI. As such, DMI is deemed to be a related party. At June 30, 2021, vendor rebate deposits due from DMI were $10,009,836. During the three and six months ended June 30, 2021, total purchases from DMI, net of holdbacks, were $26,999,225 and $27,970,121, respectively. Lease Agreements As described above, 1 Stop, Joe’s Appliances and Gold Coast have entered into lease agreements with 1870 Bath Ave. LLC, 812 5th Ave Realty LLC and 54 Glen Cove Realty, LLC, respectively. Each of these entities is owned by Albert Fouerti and Elie Fouerti (the vice president of 1 Stop, Joe’s Appliances and Gold Coast and former significant stockholder of each prior to the Acquisition). In addition, YF Logistics has entered into a sublease agreement with DMI. The total rent expense under these related party leases was $148,685 for the period June 2 to June 30, 2021. |
Stockholders' Deficit
Stockholders' Deficit | 6 Months Ended |
Jun. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' DEFICIT | NOTE 14—STOCKHOLDERS’ DEFICIT As of June 30, 2021, the Company was authorized to issue 200,000,000 shares of common stock, $0.0001 par value per share, and 20,000,000 shares of “blank check” preferred stock, 0.0001 par value per share. To date, the Company has not designated or issued any shares of preferred stock. Common Stock As of June 30, 2021 and December 31, 2020, the Company had 106,374,232 and 6,111,200 shares of common stock issued and outstanding, respectively. Each share entitles the holder thereof to one vote per share on all matters coming before the stockholders of the Company for a vote. On May 27, 2021, the Company entered into an underwriting agreement with ThinkEquity, a division of Fordham Financial Management, Inc. (the “Underwriter”), relating to a public offering of units, each unit consisting of one share of common stock and a warrant to purchase one share of common stock. Under the underwriting agreement, the Company agreed to sell 91,111,111 units to the Underwriter, at a purchase price per unit of $2.0925 (the offering price to the public of $2.25 per unit minus the Underwriter’s discount), and also agreed to grant to the Underwriter a 30-day option to purchase up to 2,000,000 additional shares of common stock, at a purchase price of $2.0832 per share, and/or warrants to purchase up to 2,000,000 additional shares of common stock, at a purchase price of $0.0093 per warrant, in any combination thereof, solely to cover over-allotments, if any. The Underwriter exercised its option to purchase 2,000,000 additional warrants on May 28, 2021 and exercised its option to purchase 2,000,000 additional shares on June 3, 2021. The shares of common stock and warrants contained in the units were immediately separable and were issued separately. On June 2, 2021, the Company sold 91,111,111 shares of common stock and warrants to purchase 93,111,111 shares of common stock for total gross proceeds of $205,020,000. After deducting the underwriting commission and expenses, the Company received net proceeds of approximately $194,597,500. The Company used the proceeds of the offering to fund a portion of the purchase price for the Acquisition. On June 7, 2021, the Company sold 2,000,000 shares of common stock to the Underwriter for total gross proceeds of $4,480,000. After deducting the underwriting commission and expenses, the Company received net proceeds of approximately $4,166,400. During June 2021, 1,039,148 shares of common stock were issued as a result of the exercise of 1,039,148 warrants with proceeds of $2,338,083 On June 2, 2021, the Company issued 5,895,973 shares of common stock to the Sellers in connection with the Acquisition (See Note 9). On June 3, 2021, the Company granted restricted stock awards under the Plan described below to certain directors and officers of the Company for an aggregate of 216,800 shares of common stock valued at $555,000, the value of the stock on the date of grant. All shares were immediately vested. The Company did not issue any shares of common stock during the three and six months ended June 20, 2020. Equity Incentive Plan Effective as of July 30, 2020, the Company established the 1847 Goedeker Inc. 2020 Equity Incentive Plan (the “Plan”) and reserved 555,000 shares of common stock for issuance under the Plan. The Plan was approved by the Company’s board of directors and stockholders on April 21, 2020. On April 9, 2021, the board of directors approved an amendment to the Plan to increase the number of shares of common Stock reserved for issuance under the Plan from 555,000 to 1,000,000 shares. Such increase was approved by the Company’s stockholders effective as of May 13, 2021. The Plan is administered by compensation committee of the board of directors. The Plan permits the grant of restricted stock, stock options and other forms of incentive compensation to the Company’s officers, employees, directors and consultants. As of June 30, 2021, a total of 228,200 shares of common stock remain available for issuance under the Plan. During the third and fourth quarters of 2020, the Company issued options for the purchase of 555,000 shares of common stock with a total fair value of $1,848,056. The Company recorded stock option expense related to these options of $113,886 and $227,772 for the three and six months ended June 30, 2021, respectively. The remaining compensation expense of $1,199,998 will be recognized over the remaining vesting period of 37 months. The following table presents activity relating to stock options for the six months ended June 30, 2021: Shares Weighted Average Outstanding at January 1, 2021 555,000 $ 9.00 9 Granted - - - Exercised - - - Forfeited / Cancelled / Expired - - - Outstanding at June 30, 2021 555,000 $ 9.00 8.50 Exercisable at June 30, 2021 65,790 $ 9.00 8.50 As of June 30, 2021, vested outstanding stock options had no intrinsic value as the exercise price is greater than the estimated fair value of the underlying common stock. The Company recognizes compensation expense for stock option awards on a straight-line basis over the applicable service period of the award. The service period is generally the vesting period. Warrants On August 4, 2020, the Company issued warrants for the purchase of 55,560 shares of common stock to affiliates of the representative in its initial public offering. These warrants are exercisable at any time and from time to time, in whole or in part, beginning on January 26, 2021 until July 30, 2025, an exercise price of $11.25 per share (subject to customary adjustments), and may also be exercised on a cashless basis if at any time during the term of the warrants the issuance of common stock upon exercise of the warrants is not covered by an effective registration statement. On March 19, 2021, the Company issued four-year warrants to purchase an aggregate of 400,000 shares of common stock to two investors. These warrants are exercisable at any time and from time to time, in whole or in part, at an exercise price of $12.00 per share (subject to customary adjustments), and may also be exercised on a cashless basis if at any time during the term of the warrants the issuance of common stock upon exercise of the warrants is not covered by an effective registration statement. On June 2, 2021, the Company issued warrants to purchase 93,111,111 shares of common stock in the public offering. These warrants are exercisable immediately and expire five years from the date of issuance. The warrants have an exercise price of $2.25 per share, subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the Company’s common stock or upon any distributions of assets, including cash, stock or other property to stockholders, and may also be exercised on a cashless basis if at any time during the term of the warrants the issuance of common stock upon exercise of the warrants is not covered by an effective registration statement. All of the foregoing warrants contain an exercise limitation, pursuant to which a holder will not have the right to exercise any portion of the warrant if the holder (together with its affiliates) would beneficially own in excess of 4.99% of the number of shares of the Company’s common stock outstanding immediately after giving effect to the exercise, which such percentage may be increased or decreased to any other percentage not in excess of 9.99% upon 61 days’ notice to the Company. The following table presents activity relating to the warrants for the six months ended June 30, 2021: Shares Weighted Weighted Average Outstanding at January 1, 2021 55,560 $ 11.25 4.5 Granted 93,511,111 2.25 5.0 Exercised (1,039,148 ) 2.25 - Cancelled / Expired - - - Outstanding at June 30, 2021 92,527,523 $ 2.30 5.0 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 15—COMMITMENTS AND CONTINGENCIES On January 18, 2019, the Company entered into an asset purchase agreement with Goedeker, Steve Goedeker and Mike Goedeker, pursuant to which on April 5, 2019 the Company acquired substantially all of the assets of Goedeker used in its retail appliance and furniture business (the “Goedeker Business”). Pursuant to the asset purchase agreement, Goedeker entitled to receive an earn out payment of $200,000 if the EBITDA (as defined in the asset purchase agreement) of the Goedeker Business for the trailing twelve (12) month period from April 5, 2022 is $2,500,000 or greater, and may be entitled to receive a partial earn out payment if the EBITDA of the Goedeker Business is less than $2,500,000 but greater than $1,500,000. The Company expects to meet this target and adjusted the contingent note payable in the condensed consolidated balance sheet to the present value of the amount due. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 16—SUBSEQUENT EVENTS In accordance with ASC 855-10, the Company has analyzed its operations subsequent to June 30, 2021 to the date these unaudited condensed consolidated financial statements were issued and has determined that it does not have any material subsequent events to disclose in these unaudited condensed consolidated financial statements, except as set forth below. On July 28, 2021, the Company issued an option under the Plan for the purchase of 150,000 shares of common stock to the Company’s new Chief Financial Officer, Maria Johnson. The option has an exercise price of $3.10 per share and vests with respect to 25% of the shares commencing on July 28, 2022 and on each of the first, second and third anniversaries thereof, respectively, subject to Ms. Johnson’s continuous service to the Company on each applicable vesting date; provided that, in the event of a change in control (as defined in the Plan), the option will vest in full. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements of the Company and its consolidated subsidiaries have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and with the instructions to Article 8 of Regulation S-X. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2020. |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiaries, ACI, 1 Stop, Gold Coast, Superior Deals, Joe’s Appliances and YF Logistics. All significant intercompany balances and transactions have been eliminated in consolidation. The Company does not have a majority or minority interest in any other company, either consolidated or unconsolidated. |
Stock Split | Stock Split On July 30, 2020, the Company completed a 4,750-for-1 forward stock split of its outstanding common stock. As a result of this stock split, the Company’s issued and outstanding common stock increased from 1,000 to 4,750,000 shares. Accordingly, all share and per share information has been restated to retroactively show the effect of this stock split. |
Use of Estimates | Use of Estimates The preparation of these unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and equivalents include: (1) currency on hand, (2) demand deposits with banks or financial institutions, (3) other kinds of accounts that have the general characteristics of demand deposits, and (4) short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. The majority of payments due from financial institutions for the settlement of credit card and debit card transactions process within two business days and are, therefore, classified as cash and cash equivalents. Other payment methods that take more time to settle are classified as receivables. At June 30, 2021, restricted cash includes approximately $300,000 to secure vendor letters of credit and $8,085,848 withheld by credit card processors as security for the Company’s customer refund claims and credit card chargebacks. Cash pledged to secure the letter of credit will be released when the vendor offers the Company credit terms, and the cash held by credit card processors will be released at the discretion of the credit card companies. |
Revenue Recognition and Cost of Revenue | Revenue Recognition and Cost of Revenue The Company records revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606. Revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASC 606 also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer purchase orders, including significant judgments. The Company’s performance obligation is to deliver the customer’s order. Each customer order generally contains only one performance obligation based on the merchandise sale to be delivered, at which time revenue is recognized. Control of the delivery transfers to customers when the customer can direct the use of, and obtain substantially all the benefits from, the Company’s products, which generally occurs when the customer assumes the risk of loss. The risk of loss shifts to the customer at different times depending on the method of delivery. The Company delivers products to its customers in three possible ways. The first way is through a shipment of the products through a third-party carrier from the Company’s warehouse to the customer (a “Company Shipment”). The second way is through a shipment of the products through a third-party carrier from a warehouse other than the Company’s warehouse to the customer (a “Drop Shipment”) and the third way is where the Company itself delivers the products to the customer and often also installs the product (a “Local Delivery”). In the case of a Local Delivery, the Company loads the product on to its own truck and delivers and installs the product at the customer’s location. When a product is delivered through a Local Delivery, risk of loss passes to the customer at the time of installation and revenue is recognized upon installation at the customer’s location. In the case of a Company Shipment and a Drop Shipment, the delivery to the customer is made free on board, or FOB, shipping point (whether from the Company’s warehouse or a third party’s warehouse). Therefore, risk of loss and title transfers to the customer once the products are shipped (i.e., leaves the Company’s warehouse or a third-party’s warehouse). After shipment and prior to delivery, the customer is able to redirect the product to a different destination, which demonstrates the customer’s control over the product once shipped. Once the risk of loss has shifted to the customer, the Company has satisfied its performance obligation and the Company recognizes revenue. The Company agrees with customers on the selling price of each transaction. This transaction price is generally based on the agreed upon sales price. In the Company’s contracts with customers, it allocates the entire transaction price to the sales price, which is the basis for the determination of the relative standalone selling price allocated to each performance obligation. Any sales tax, value added tax, and other tax the Company collects concurrently with revenue-producing activities are excluded from revenue. Cost of revenue includes the cost of purchased merchandise plus the cost of shipping merchandise and where applicable installation, net of promotional rebates and other incentives received from vendors. Substantially all the Company’s sales are to individual retail consumers (homeowners), builders and designers. Shipping and Handling ‒ The Company bills its customers for shipping and handling charges, which are included in net sales for the applicable period, and the corresponding shipping and handling expense is reported in cost of sales. Disaggregated Revenue The Company’s disaggregated revenue by product type is as follows: Three Months Ended Six Months Ended 2021 2020 2021 2020 Appliance sales $ 56,202,115 $ 11,533,006 $ 66,387,297 $ 19,335,110 Furniture sales 6,172,784 2,768,327 8,487,474 4,050,163 Other sales 1,697,199 983,698 2,894,695 1,576,936 Total $ 64,072,098 $ 15,285,031 $ 77,769,466 $ 24,962,209 The Company also sells extended warranty contracts. The Company is an agent for the warranty company and earns a commission on the warranty contracts purchased by customers; therefore, the cost of the warranty contracts is netted against warranty revenue in the accompanying consolidated statement of operations. The Company assumes no liability for repairs to products on which it has sold a warranty contract. |
Receivables | Receivables Receivables consists of customer’s balance payments for which the Company extends credit to certain homebuilders and designers based on prior business relationship, and vendor rebate receivables. Vendor rebates receivable represent amounts due from manufactures from whom the Company purchases products. Rebates receivable are stated at the amount that management expects to collect from manufacturers (vendors). Rebates are calculated on product and model sales programs from specific vendors. The rebates are paid at intermittent periods either in cash or through issuance of vendor credit memos, which can be applied against vendor accounts payable. Based on the Company’s assessment of the credit history with its manufacturers, it has concluded that there should be no allowance for uncollectible accounts. The Company historically collects substantially all its trade receivables from customers and bad debt expense has been historically immaterial to the combined financial statements. Uncollectible balances are expensed in the period it is determined to be uncollectible. The Company had no significant concentrations of receivables balances as of June 30, 2021 |
Merchandise Inventory | Merchandise Inventory Inventory consists of finished products acquired for resale and is valued at the lower-of-cost-or-market with cost determined on an average item basis. The Company periodically evaluates the value of items in inventory and provides write-downs to inventory based on its estimate of market conditions. |
Property and Equipment | Property and Equipment Property and equipment is stated at the historical cost. Maintenance and repairs of property and equipment are charged to operations as incurred. Leasehold improvements are amortized over the lesser of the base term of the lease or estimated life of the leasehold improvements. Depreciation is computed using the straight-line method over estimated useful lives as follows: Category Useful Life (Years) Furniture and fixtures 7 Machinery and equipment 5-7 Office equipment 5-7 Transportation equipment 5 |
Goodwill | Goodwill The Company tests its goodwill for impairment at least annually on December 31 and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company’s expected future cash flows; a significant adverse change in legal factors or in the business climate; unanticipated competition; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and the Company’s consolidated financial results. The Company tests goodwill by estimating fair value using a Discounted Cash Flow (“DCF”) model. The key assumptions used in the DCF model to determine the highest and best use of estimated future cash flows include revenue growth rates and profit margins based on internal forecasts, terminal value and an estimate of a market participant’s weighted-average cost of capital used to discount future cash flows to their present value. There were no impairment charges during three and six months ended June 30, 2021 and 2020. |
Intangible Assets | Intangible Assets As of June 30, 2021 and December 31, 2020, definite-lived intangible assets primarily consisted of tradenames and customer relationships which are being amortized over their estimated useful lives, or 5 years. The Company periodically evaluates the reasonableness of the useful lives of these assets. Once these assets are fully amortized, they are removed from the accounts. These assets are reviewed for impairment or obsolescence when events or changes in circumstances indicate that the carrying amount may not be recoverable. If impaired, intangible assets are written down to fair value based on discounted cash flows or other valuation techniques. The Company has no intangibles with indefinite lives. In applying the acquisition method of accounting, amounts assigned to identifiable assets and liabilities acquired were based on estimated fair values as of the date of acquisition, with the remainder recorded as goodwill. Identifiable intangible assets are initially valued at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Identifiable intangible assets with definite lives are amortized over their estimated useful lives and are reviewed for impairment if indicators of impairment arise. Intangible assets with indefinite lives are tested for impairment within one year of acquisitions or annually as of December 1, and whenever indicators of impairment exist. The fair values of intangible assets are compared against their carrying values, and an impairment loss would be recognized for the amount by which a carrying amount exceeds its fair value. Impairments for the three and six months ended June 30, 2021 were $1,437,042 due to an abandonment of certain right of use assets. There were no impairments for the six months ended June 30, 2020. |
Long-Lived Assets | Long-Lived Assets The Company reviews its property and equipment and any identifiable intangibles (including right of use assets) for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The test for impairment is required to be performed by management upon triggering events. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell. Impairments for the three and six months ended June 30, 2021 were $1,437,042 due to an abandonment of certain right of use assets and the respective leasehold improvements. There were no impairments for the six months ended June 30, 2020. |
Lease Liabilities | Lease Liabilities Lease liabilities and their corresponding right of use assets are recorded based on the present value of lease payments over the expected lease term at the lease commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate (“IBR”) based on the information available at the commencement date of the respective lease to determine the present value of future payments. The determination of the IBR requires judgment and is primarily based on publicly available information for companies within the same industry and with similar credit profiles. The Company adjusts the rate for the impact of collateralization, the lease term and other specific terms included in each lease arrangement. The IBR is determined at the lease commencement and is subsequently reassessed upon a modification to the lease arrangement. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company reviews the right of use asset for impairment whenever events or changes in circumstances indicate that the carrying amount of the right of use asset may not be recoverable. When such events occur, the Company compares the carrying amount of the right of use asset to the undiscounted expected future cash flows related to the right of use asset. If the comparison indicates that an impairment exists, the amount of the impairment is calculated as the difference between the excess of the carrying amount over the fair value of the right of use asset. If a readily determinable market price does not exist, fair value is estimated using discounted expected cash flows attributable to the right of use asset. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Cash, restricted cash, receivables, inventory, and prepaid expenses approximate fair value, due to their short-term nature. The fair value hierarchy is defined in the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. |
Customer Deposits | Customer Deposits Customer deposits represent the amount collected from customers when an order is placed. The deposits are transferred to revenue when the order ships to the customer or returned to the customer if the order is subsequently cancelled. |
Income Taxes | Income Taxes Under the Company’s accounting policies, the Company initially recognizes a tax position in its unaudited condensed consolidated financial statements when it becomes more likely than not that the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the largest amount of tax positions that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authorities assuming full knowledge of the position and all relevant facts. Although the Company believes its provisions for unrecognized tax positions are reasonable, the Company can make no assurance that the final tax outcome of these matters will not be different from that which the Company has reflected in its income tax provisions and accruals. The tax law is subject to varied interpretations, and the Company has taken positions related to certain matters where the law is subject to interpretation. Such differences could have a material impact on the Company’s income tax provisions and operating results in the period(s) in which the Company makes such determination. In the second quarter of 2021, the Company acquired Appliances Connection. Appliances Connection has a history of profitable operations. As such, the Company determined that it was more likely than not that it would have profitable operations in the future and therefore be able to realize the deferred tax assets and accordingly reversed the allowance for deferred tax assets at June 30, 2021. |
Sales Tax Liability | Sales Tax Liability On June 21, 2018, the U.S. Supreme Court issued an opinion in South Dakota v. Wayfair, Inc., 138 S. Ct. 2080 (2018) Quill Corp v. North Dakota As of June 30, 2021, only one state has notified the Company of a potential sales tax liability of approximately $82,000, all of which was previously accrued. |
Income (Loss) Per Share | Income (Loss) Per Share Basic income (loss) per share is calculated by dividing the net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive securities. For the three and six months ended June 30, 2021, the potentially dilutive securities were warrants for the purchase of 455,560 shares of common stock and options for the purchase of 555,000 shares of common stock. The potentially dilutive securities for the three and six months ended June 30, 2020 were warrants for the purchase of 250,000 shares of common stock. These potentially dilutive securities were excluded from diluted loss per share. |
Reclassifications | Reclassifications Certain accounts have been reclassified to conform with classifications adopted in the period ended June 30, 2021. Such reclassifications had no effect on net earnings or financial position. |
Impact of COVID-19 | Impact of COVID-19 In December 2019, a novel strain of coronavirus (“COVID-19”) emerged in China. On March 11, 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic. The extent of the COVID-19 pandemic’s continued effect on the Company’s operational and financial performance and those of third parties on which the Company relies will depend on future developments, including the effectiveness of vaccines and other treatments for COVID-19, and other new information that may emerge concerning the severity of the pandemic and steps taken to contain the pandemic or treat its impact, among others. The ultimate impact of the COVID-19 pandemic is highly uncertain and subject to change. The Company does not yet know the full extent of potential impacts on its business and financing. However, these effects could have a material impact on the Company’s liquidity, capital resources, operations and business and those of the third parties on which the Company relies. |
Going Concern Assessment | Going Concern Assessment Management assesses going concern uncertainty in the Company’s unaudited condensed consolidated financial statements to determine whether there is sufficient cash on hand and working capital, including available borrowings on loans, to operate for a period of at least one year from the date the unaudited condensed consolidated financial statements are issued or available to be issued, which is referred to as the “look-forward period”, as defined in GAAP. As part of this assessment, based on conditions that are known and reasonably knowable to management, management will consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including the timing and nature of projected cash expenditures or programs, its ability to delay or curtail expenditures or programs and its ability to raise additional capital, if necessary, among other factors. Based on this assessment, as necessary or applicable, management makes certain assumptions around implementing curtailments or delays in the nature and timing of programs and expenditures to the extent it deems probable those implementations can be achieved and management has the proper authority to execute them within the look-forward period. For the six months ended June 30, 2021, the Company incurred operating losses of approximately $4,543,516 and negative cash flow from operations of $6,985,302, but had working capital of $15,530,879. Additionally, the Company had over $45 million of unrestricted cash at June 30, 2021. On June 2, 2021, the Company closed on the acquisition of Appliances Connection. Appliances Connection has historically been profitable, however, only 29 days of their operations are included in results for the three and six months of 2021. Management has prepared estimates of operations for fiscal years 2021 and 2022 and believes that sufficient funds will be generated from operations to fund its operations, and to service its debt obligations for one year from the date of the filing of these unaudited condensed consolidated financial statements. Additionally, only one month of operations for Appliances Connection, which has operated profitably, are included in the results of operations for the six months ended June 30, 2021. The impact of COVID-19 on the Company’s business has been considered in these assumptions; however, it is too early to know the full impact of COVID-19 or its timing on a return to more normal operations. The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize its assets and satisfy its liabilities in the normal course of business. Management believes that based on relevant conditions and events that are known and reasonably knowable that its forecasts, for one year from the date of the filing of these unaudited condensed consolidated financial statements, indicate improved operations and the Company’s ability to continue operations as a going concern. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement Not Yet Adopted In June 2016, the FASB issued ASU 2016-13 Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The Company currently believes that all other issued and not yet effective accounting standards are not relevant to the Company’s unaudited condensed consolidated financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of disaggregated revenue | Three Months Ended Six Months Ended 2021 2020 2021 2020 Appliance sales $ 56,202,115 $ 11,533,006 $ 66,387,297 $ 19,335,110 Furniture sales 6,172,784 2,768,327 8,487,474 4,050,163 Other sales 1,697,199 983,698 2,894,695 1,576,936 Total $ 64,072,098 $ 15,285,031 $ 77,769,466 $ 24,962,209 |
Schedule of property and equipment estimated useful life | Category Useful Life (Years) Furniture and fixtures 7 Machinery and equipment 5-7 Office equipment 5-7 Transportation equipment 5 |
Receivables (Tables)
Receivables (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Receivables [Abstract] | |
Schedule of receivables | June 30, December 31, Trade receivables from customers $ 11,858,185 $ - Vendor rebates receivable 5,486,634 1,337,791 Credit cards in process of collection 189,207 660,441 Other receivables 3,732,761 - Total receivables $ 21,266,787 $ 1,998,232 |
Merchandise Inventory (Tables)
Merchandise Inventory (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory balances | June 30, December 31, Appliances $ 19,974,548 $ 5,285,975 Furniture 486,207 194,852 Other 1,098,268 91,414 Total merchandise inventory 21,559,023 5,572,241 Allowance for inventory obsolescence (425,000 ) (425,000 ) Merchandise inventory, net $ 21,134,023 $ 5,147,241 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | June 30, December 31, Equipment $ 69,336 $ 69,336 Warehouse equipment 374,448 61,070 Furniture and fixtures 8,434 512 Transportation equipment 1,417,047 63,784 Leasehold improvements 216,405 136,931 Construction in progress 509,428 - Total property and equipment 2,595,098 331,633 Accumulated depreciation (115,043 ) (85,685 ) Property and equipment, net $ 2,480,055 $ 245,948 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | June 30, December 31, Customer relationships $ 749,000 $ 749,000 Marketing related - tradename 1,368,000 1,368,000 Total intangible assets 2,117,000 2,117,000 Accumulated amortization (946,761 ) (735,063 ) Intangible assets, net $ 1,170,239 $ 1,381,937 |
Schedule of annual amortization expense | 2021 (remainder of year) $ 211,698 2022 423,396 2023 423,396 2024 111,749 Total $ 1,170,239 |
Schedule of goodwill | Balance December 31, 2020 $ 4,725,689 Preliminary goodwill from acquisition of Appliances Connection 217,382,100 Balance June 30, 2021 $ 222,107,789 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | June 30, December 31, Trade accounts payable $ 23,939,457 $ 5,975,486 Sales tax 17,947,165 5,804,100 Accrued payroll liabilities 786,407 492,573 Accrued interest 199,340 10,000 Accrued liability for sales returns 200,000 200,000 Other accrued liabilities 8,825,297 219,556 Total accounts payable and accrued expenses $ 51,897,666 $ 12,701,715 |
Business Combination (Tables)
Business Combination (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Business Combinations [Abstract] | |
Schedule of preliminary analysis for the Goedeker asset purchase | Provisional purchase consideration at preliminary fair value: Cash consideration $ 180,000,000 Share issuance 12,263,624 Working capital adjustment paid to sellers 24,060,458 Working capital adjustment payable to sellers 8,537,025 Amount of consideration $ 224,861,107 Assets acquired and liabilities assumed at preliminary fair value Cash $ 6,437,220 Accounts receivable 19,744,368 Inventories 18,300,781 Vendor deposits 15,000,000 Other assets 2,194,384 Property and equipment 1,890,968 Right of use operating lease assets 1,833,899 Accounts payable and accrued expenses (43,673,578 ) Customer deposits (10,673,600 ) Finance lease obligation (215,008 ) Operating lease liability (1,833,899 ) Current portion of notes payable (458,913 ) Long term portion of notes payable (1,067,615 ) Net tangible assets acquired $ 7,479,007 Total net assets acquired $ 7,479,007 Consideration paid 224,861,107 Preliminary goodwill $ 217,382,100 |
Schedule of consolidated statement of operations | Three Months Ended Six Months Ended 2021 2020 2021 2020 Product sales, net $ 140,128,696 $ 91,490,100 $ 263,086,153 $ 158,241,719 Net income $ 17,288,674 $ 799,593 $ 32,898,194 $ 3,443,584 Basic earnings per share $ 0.16 $ 0.01 $ 0.31 $ 0.03 Diluted earnings per share (a) $ 0.16 $ 0.01 $ 0.31 $ 0.03 Basic number of shares 105,335,084 105,335,084 105,335,084 105,335,084 Diluted number of shares 105,335,084 105,335,084 105,335,084 105,335,084 |
Notes Payable (Tables)
Notes Payable (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of maturities of term loan | For the years ended December 31, Amount 2021 (remainder of year) $ 3,000,000 2022 6,000,000 2023 6,000,000 2024 6,000,000 2025 6,000,000 Thereafter 33,000,000 Total 60,000,000 Less: Loan costs (3,688,479 ) Total $ 56,311,521 Amount classified as a current liability $ 6,000,000 Amount classified as long-term liability $ 50,311,521 |
Schedule of payments due for succeeding five years | For the years ended December 31, Amount 2021 (remainder of year) $ 246,761 2022 396,848 2023 363,842 2024 311,979 2025 169,190 Thereafter - Total $ 1,488,620 Amount classified as a current liability $ 455,272 Amount classified as a long-term liability $ 1,033,348 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
ASU 2016-02 Transition [Abstract] | |
Schedule of financing leases liability | For the years ended December 31, Amount 2021 (remainder of year) $ 36,528 2022 66,284 2023 52,644 2024 35,688 2025 and thereafter 48,960 Total payments 240,104 Less: amount representing interest (29,295 ) Present value of minimum lease payments $ 210,809 |
Schedule of supplemental balance sheet information related to leases | Operating lease right-of-use assets $ 12,822,972 Lease liabilities, current portion $ 2,157,010 Lease liabilities, long-term 12,149,107 Total operating lease liabilities $ 14,306,117 Weighted average remaining lease term (months) 100 Weighted average discount rate 4.2 % |
Schedule of financing leases liability | 2021 (remainder of year) $ 1,167,967 2022 2,580,999 2023 2,620,008 2024 1,805,142 2025 1,486,525 Thereafter 7,065,391 Total lease payments $ 16,726,032 Less imputed interest (2,419,915 ) Total lease liability $ 14,306,117 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of activity relating to stock options | Shares Weighted Average Outstanding at January 1, 2021 555,000 $ 9.00 9 Granted - - - Exercised - - - Forfeited / Cancelled / Expired - - - Outstanding at June 30, 2021 555,000 $ 9.00 8.50 Exercisable at June 30, 2021 65,790 $ 9.00 8.50 |
Schedule of activity relating to warrants | Shares Weighted Weighted Average Outstanding at January 1, 2021 55,560 $ 11.25 4.5 Granted 93,511,111 2.25 5.0 Exercised (1,039,148 ) 2.25 - Cancelled / Expired - - - Outstanding at June 30, 2021 92,527,523 $ 2.30 5.0 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jul. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Forward stock split, description | the Company completed a 4,750-for-1 forward stock split of its outstanding common stock. As a result of this stock split, the Company’s issued and outstanding common stock increased from 1,000 to 4,750,000 shares. Accordingly, all share and per share information has been restated to retroactively show the effect of this stock split. | |||||
Restricted cash and cash equivalents, description | restricted cash includes approximately $300,000 to secure vendor letters of credit and $8,085,848 withheld by credit card processors as security for the Company’s customer refund claims and credit card chargebacks. | |||||
Impairment right of use assets | $ 1,437,042 | $ 1,437,042 | ||||
Impairment long lived right of use assets | 1,437,042 | 1,437,042 | ||||
Accounts payable and accrued expenses | 17,947,165 | 17,947,165 | $ 5,804,100 | |||
Sales tax liability connection transaction | 10,975,324 | |||||
Accrued interest | 1,042,991 | 1,042,991 | ||||
Potential sales tax liability | 82,000 | 82,000 | ||||
Operating lossses | (1,262,830) | $ (1,387,999) | (4,543,516) | $ (3,576,332) | ||
Cash flows used in operations | (6,985,302) | $ 3,852,042 | ||||
Negative working capital | 15,530,879 | 15,530,879 | ||||
lease hold improvements | $ 45 | $ 45 | ||||
Warrant [Member] | ||||||
Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Potentially dilutive securities (in Shares) | 455,560 | 250,000 | ||||
Share-based Payment Arrangement, Option [Member] | ||||||
Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Potentially dilutive securities (in Shares) | 555,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of disaggregated revenue - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of disaggregated revenue [Abstract] | ||||
Appliance sales | $ 56,202,115 | $ 11,533,006 | $ 66,387,297 | $ 19,335,110 |
Furniture sales | 6,172,784 | 2,768,327 | 8,487,474 | 4,050,163 |
Other sales | 1,697,199 | 983,698 | 2,894,695 | 1,576,936 |
Total | $ 64,072,098 | $ 15,285,031 | $ 77,769,466 | $ 24,962,209 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life | 6 Months Ended |
Jun. 30, 2021 | |
Furniture and Fixtures [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life [Line Items] | |
Useful Life | 7 years |
Transportation Equipment [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life [Line Items] | |
Useful Life | 5 years |
Minimum [Member] | Machinery and Equipment [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life [Line Items] | |
Useful Life | 5 years |
Minimum [Member] | Office Equipment [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life [Line Items] | |
Useful Life | 5 years |
Maximum [Member] | Machinery and Equipment [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life [Line Items] | |
Useful Life | 7 years |
Maximum [Member] | Office Equipment [Member] | |
Summary of Significant Accounting Policies (Details) - Schedule of property and equipment estimated useful life [Line Items] | |
Useful Life | 7 years |
Receivables (Details) - Schedul
Receivables (Details) - Schedule of receivables - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Schedule of receivables [Abstract] | ||
Trade receivables from customers | $ 11,858,185 | |
Vendor rebates receivable | 5,486,634 | 1,337,791 |
Credit cards in process of collection | 189,207 | 660,441 |
Other receivables | 3,732,761 | |
Total receivables | $ 21,266,787 | $ 1,998,232 |
Merchandise Inventory (Details)
Merchandise Inventory (Details) - Schedule of inventory balances - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Inventory [Line Items] | ||
Total merchandise inventory | $ 21,559,023 | $ 5,572,241 |
Allowance for inventory obsolescence | (425,000) | (425,000) |
Merchandise inventory, net | 21,134,023 | 5,147,241 |
Appliances [Member] | ||
Inventory [Line Items] | ||
Total merchandise inventory | 19,974,548 | 5,285,975 |
Furniture [Member] | ||
Inventory [Line Items] | ||
Total merchandise inventory | 486,207 | 194,852 |
Other [Member] | ||
Inventory [Line Items] | ||
Total merchandise inventory | $ 1,098,268 | $ 91,414 |
Vendor Deposits (Details)
Vendor Deposits (Details) - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Vendor Deposits Disclosure [Abstract] | ||
Vendor deposits | $ 10,755,209 | $ 547,648 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 85,777 | $ 21,864 |
Property and Equipment (Detai_2
Property and Equipment (Details) - Schedule of property and equipment - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 2,595,098 | $ 331,633 |
Accumulated depreciation | (115,043) | (85,685) |
Property and equipment, net | 2,480,055 | 245,948 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 69,336 | 69,336 |
Warehouse equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 374,448 | 61,070 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 8,434 | 512 |
Transportation equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,417,047 | 63,784 |
Leasehold improvements[Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 216,405 | $ 136,931 |
Construction in progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 509,428 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Identifiable intangible assets | $ 2,117,000 | $ 2,117,000 | $ 2,117,000 | ||
Weighted average estimated useful life | 2 years 9 months | ||||
Amortization expense | $ 10,849 | $ 80,883 | $ 211,698 | $ 161,766 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill (Details) - Schedule of intangible assets - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Schedule of intangible assets [Abstract] | ||
Customer relationships | $ 749,000 | $ 749,000 |
Marketing related - tradename | 1,368,000 | 1,368,000 |
Total intangible assets | 2,117,000 | 2,117,000 |
Accumulated amortization | (946,761) | (735,063) |
Intangible assets, net | $ 1,170,239 | $ 1,381,937 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill (Details) - Schedule of annual amortization expense | Jun. 30, 2021USD ($) |
Schedule of annual amortization expense [Abstract] | |
2021 (remainder of year) | $ 211,698 |
2022 | 423,396 |
2023 | 423,396 |
2024 | 111,749 |
Total | $ 1,170,239 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill (Details) - Schedule of goodwill | Jun. 30, 2021USD ($) |
Schedule of goodwill [Abstract] | |
Balance December 31, 2020 | $ 4,725,689 |
Preliminary goodwill from acquisition of Appliances Connection | 217,382,100 |
Balance June 30, 2021 | $ 222,107,789 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - Schedule of accounts payable and accrued expenses - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Schedule of accounts payable and accrued expenses [Abstract] | ||
Trade accounts payable | $ 23,939,457 | $ 5,975,486 |
Sales tax | 17,947,165 | 5,804,100 |
Accrued payroll liabilities | 786,407 | 492,573 |
Accrued interest | 199,340 | 10,000 |
Accrued liability for sales returns | 200,000 | 200,000 |
Other accrued liabilities | 8,825,297 | 219,556 |
Total accounts payable and accrued expenses | $ 51,897,666 | $ 12,701,715 |
Business Combination (Details)
Business Combination (Details) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021USD ($) | Jun. 30, 2021USD ($) | |
Business Combinations [Abstract] | ||
Common stock, description | The aggregate purchase price is $222,000,000 (subject to adjustment), consisting of (i) $180,000,000 in cash (subject to adjustment), (ii) 2,333,333 shares of the Company’s common stock having a stated value that is equal to $21,000,000 and (iii) 3,562,640 shares of the Company’s common stock, which is equal to (A) $21,000,000 divided by (B) the average of the closing price of the Company’s common stock (as reported on NYSE American) for the 20 trading days immediately preceding the 3rd trading day prior to the closing date of the Acquisition. | |
Working capital exceeded | $ (15,476,941) | $ (15,476,941) |
Deposits | 100,000 | 100,000 |
Additional deposit | 75,000 | 75,000 |
Cash portion of the purchase price | 212,597,483 | |
Fair value of assets acquired | 7,479,007 | |
Fair value of the net tangible assets | 217,382,100 | 217,382,100 |
Revenue | 47,780,835 | 47,780,835 |
Net income | $ 4,872,936 | $ 4,872,936 |
Business Combination (Details)
Business Combination (Details) - Schedule of preliminary analysis for the Goedeker asset purchase - USD ($) | 6 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2020 | |
Provisional purchase consideration at preliminary fair value: | ||
Cash consideration | $ 180,000,000 | |
Share issuance | 12,263,624 | |
Working capital adjustment paid to sellers | 24,060,458 | |
Working capital adjustment payable to sellers | 8,537,025 | |
Amount of consideration | 224,861,107 | |
Assets acquired and liabilities assumed at preliminary fair value | ||
Cash | 6,437,220 | |
Accounts receivable | 19,744,368 | |
Inventories | 18,300,781 | |
Vendor deposits | 15,000,000 | |
Other assets | 2,194,384 | |
Property and equipment | 1,890,968 | |
Right of use operating lease assets | 1,833,899 | |
Accounts payable and accrued expenses | (43,673,578) | |
Customer deposits | (10,673,600) | |
Finance lease obligation | (215,008) | |
Operating lease liability | (1,833,899) | |
Current portion of notes payable | (458,913) | |
Long term portion of notes payable | (1,067,615) | $ (6,000,000) |
Net tangible assets acquired | 7,479,007 | |
Total net assets acquired | 7,479,007 | |
Consideration paid | 224,861,107 | |
Preliminary goodwill | $ 217,382,100 |
Business Combination (Details_2
Business Combination (Details) - Schedule of consolidated statement of operations - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Schedule of consolidated statement of operations [Abstract] | |||||
Product sales, net | $ 140,128,696 | $ 91,490,100 | $ 263,086,153 | $ 158,241,719 | |
Net income | $ 17,288,674 | $ 799,593 | $ 32,898,194 | $ 3,443,584 | |
Basic earnings per share | $ 0.16 | $ 0.01 | $ 0.31 | $ 0.03 | |
Diluted earnings per share | [1] | $ 0.16 | $ 0.01 | $ 0.31 | $ 0.03 |
Basic number of shares | 105,335,084 | 105,335,084 | 105,335,084 | 105,335,084 | |
Diluted number of shares | 105,335,084 | 105,335,084 | 105,335,084 | 105,335,084 | |
[1] | Assumes shares outstanding at offering were outstanding for all periods and that warrant price is equal to the offering price resulting in no diluted shares. |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Jun. 02, 2021 | Mar. 19, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Aug. 25, 2020 |
Notes Payable (Details) [Line Items] | |||||
Credit facilities, description | pursuant to which the Lenders have agreed to make available to the Company and ACI senior secured credit facilities in the aggregate initial amount of $70,000,000, including (i) a $60,000,000 term loan (the “Term Loan”) and (ii) a $10,000,000 revolving credit facility (the “Revolving Loan”), which revolving credit facility includes a $2,000,000 swingline subfacility (the “Swing Line Loan” and together with the Term Loan and the Revolving Loan, the “Loans”) and a $2,000,000 letter of credit subfacility, in each case, on the terms and conditions contained in the Credit Agreement. On June 2, 2021, the Company borrowed the entire amount of the Term Loan and issued term loan notes to the Lenders in the aggregate principal amount of $60,000,000. As of June 30, 2021, the Company has not made any loans under the Revolving Loan. As of June 30, 2021, the outstanding balance of the Term Loan is $56,311,521, comprised of principal of $60,000,000, net of unamortized loan costs of $3,688,479. Loan costs before amortization include $3,500,000 of lender and placement agent fees and $250,995 of legal other fees. The Company classified $6,000,000 as a current liability and the balance as a long-term liability. | ||||
Interest rate | 3.90% | ||||
Interest rate per annum | 2.00% | ||||
Term loan quarterly installments | The Company must repay the principal amount of the Term Loan in quarterly installments of $1,500,000 each, payable on the last business day of each March, June, September and December, commencing on September 30, 2021. | ||||
Commitment fee percentage per annum | 0.50% | ||||
Credit limit | $ 1,000,000 | ||||
Principal amount | $ 3,500,000 | ||||
Outstanding balance | $ 3,185,369 | ||||
Comprised of principal | 3,283,628 | ||||
Unamortized loan costs | $ 98,259 | ||||
Securities purchase agreement, description | the Company entered into a securities purchase agreement with two institutional investors, pursuant to which the Company issued to each investor (i) a 10% OID senior secured promissory note in the principal amount of $2,750,000 and (ii) a four-year warrant to purchase 200,000 shares of the Company’s common stock at an exercise price of $12.00, subject to adjustments, which may be exercised on a cashless basis, for a purchase price of $2,500,000 each, or $5,000,000 in the aggregate, the relative fair value of which is $1,340,438 and was recorded as debt discount. After deducting a placement fee and other expenses, the Company received net proceeds of $4,590,000. The original issue discount and warrant expense were amortized as interest expense. On June 2, 2021, the Company repaid these notes in full from the proceeds of the Term Loan. At the time of repayment, the Company wrote off the balance of the debt discount, $1,653,048, as a loss on early extinguishment of debt. | ||||
Outstanding balance of notes | $ 1,488,620 | ||||
Minimum [Member] | |||||
Notes Payable (Details) [Line Items] | |||||
Interest rates | 3.59% | ||||
Maximum [Member] | |||||
Notes Payable (Details) [Line Items] | |||||
Interest rates | 5.74% |
Notes Payable (Details) - Sched
Notes Payable (Details) - Schedule of maturities of term loan - USD ($) | Jun. 30, 2021 | Dec. 31, 2020 |
Schedule of maturities of term loan [Abstract] | ||
2021 (remainder of year) | $ 3,000,000 | |
2022 | 6,000,000 | |
2023 | 6,000,000 | |
2024 | 6,000,000 | |
2025 | 6,000,000 | |
Thereafter | 33,000,000 | |
Total | 60,000,000 | |
Less: Loan costs | (3,688,479) | |
Total | 56,311,521 | |
Amount classified as a current liability | $ 1,067,615 | 6,000,000 |
Amount classified as long-term liability | $ 50,311,521 |
Notes Payable (Details) - Sch_2
Notes Payable (Details) - Schedule of payments due for succeeding five years | Dec. 31, 2021USD ($) |
Schedule of payments due for succeeding five years [Abstract] | |
2021 (remainder of year) | $ 246,761 |
2022 | 396,848 |
2023 | 363,842 |
2024 | 311,979 |
2025 | 169,190 |
Thereafter | |
Total | 1,488,620 |
Amount classified as a current liability | 455,272 |
Amount classified as a long-term liability | $ 1,033,348 |
Leases (Details)
Leases (Details) - USD ($) | Jun. 02, 2021 | Jan. 13, 2021 | Apr. 05, 2019 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 |
Leases (Details) [Line Items] | ||||||||
Finance lease payment due | $ 210,809 | $ 210,809 | ||||||
Base rent Increases | $ 74,263 | $ 45,000 | ||||||
Lease agreement, description | The Company must also pay its 43.4% pro rata portion of the property taxes, operating expenses and insurance costs and is also responsible to pay for the utilities used on the premises. | |||||||
Right of use assets | 1,954,022 | 1,954,022 | ||||||
Term of lease | 10 years | |||||||
Base rent Increases | $ 96,896 | |||||||
Operating lease light of use asset | 8,430,959 | $ 12,822,972 | $ 12,822,972 | $ 1,578,235 | ||||
Percentage of base rent | 71.43% | 71.43% | ||||||
Percentage of taxes Paid | 71.43% | 71.43% | ||||||
Total amont | $ 56,250 | $ 56,250 | ||||||
Right of asset and liability | 3,007,661 | 3,007,661 | ||||||
Accrued rent expense | $ 62,386 | $ 461,401 | $ 721,959 | $ 671,135 | ||||
LLC [Member] | ||||||||
Leases (Details) [Line Items] | ||||||||
Base rent Increases | 6,365 | |||||||
Lease agreement, description | the Company entered into a lease agreement with Westgate 200, LLC, which was amended on March 31, 2021, for its new principal office and showroom in St. Charles, Missouri. The lease terminates on April 30, 2027, with two (2) options to renew for additional five (5) year periods. The base rent is $20,977 per month until September 30, 2021, and increases to $31,465 per month until April 30, 2022, after which time the base rent increases at approximately 2.5% per year thereafter. | |||||||
Base rent Increases | 8,305 | |||||||
Operating lease light of use asset | $ 723,074 |
Leases (Details) - Schedule of
Leases (Details) - Schedule of financing leases liability | Jun. 30, 2021USD ($) |
Schedule of financing leases liability [Abstract] | |
2021 (remainder of year) | $ 36,528 |
2022 | 66,284 |
2023 | 52,644 |
2024 | 35,688 |
2025 and thereafter | 48,960 |
Total payments | 240,104 |
Less: amount representing interest | (29,295) |
Present value of minimum lease payments | $ 210,809 |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of supplemental balance sheet information related to leases - USD ($) | Jun. 30, 2021 | Jun. 02, 2021 | Dec. 31, 2020 |
Schedule of supplemental balance sheet information related to leases [Abstract] | |||
Operating lease right-of-use assets | $ 12,822,972 | $ 8,430,959 | $ 1,578,235 |
Lease liabilities, current portion | 2,157,010 | 450,712 | |
Lease liabilities, long-term | 12,149,107 | $ 1,127,523 | |
Total operating lease liabilities | $ 14,306,117 | ||
Weighted average remaining lease term (months) | 100 years | ||
Weighted average discount rate | 4.20% |
Leases (Details) - Schedule o_3
Leases (Details) - Schedule of maturities of the lease liability | Jun. 30, 2021USD ($) |
Schedule of maturities of the lease liability [Abstract] | |
2021 (remainder of year) | $ 1,167,967 |
2022 | 2,580,999 |
2023 | 2,620,008 |
2024 | 1,805,142 |
2025 | 1,486,525 |
Thereafter | 7,065,391 |
Total lease payments | 16,726,032 |
Less imputed interest | (2,419,915) |
Total lease liability | $ 14,306,117 |
Supplier Concentration (Details
Supplier Concentration (Details) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Supplier Concentration (Details) [Line Items] | ||
Concentration risk percentage | 55.00% | 60.00% |
Revenue Benchmark [Member] | ||
Supplier Concentration (Details) [Line Items] | ||
Concentration risk percentage | 10.00% |
Related Parties (Details)
Related Parties (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Related Party Transactions [Abstract] | ||||
Service fee to manager | $ 62,500 | |||
Management fees | $ 62,500 | $ 62,500 | $ 125,000 | $ 125,000 |
Equity interest rate | 5.00% | |||
Vendor rebate deposits | 10,009,836 | $ 10,009,836 | ||
Rent expense | 148,685 | |||
Net of holdback, value | $ 26,999,225 | $ 27,970,121 |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) - USD ($) | Jun. 07, 2021 | Jun. 03, 2021 | Jun. 02, 2021 | May 27, 2021 | Jun. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jul. 30, 2021 | Apr. 09, 2021 | Mar. 19, 2021 | Dec. 31, 2020 | Aug. 04, 2020 | Mar. 19, 2020 |
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Common stock, shares authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||||||||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||||||||
Preferred stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||
Common stock, shares issued | 106,374,232 | 106,374,232 | 6,111,200 | ||||||||||
Common stock, shares outstanfing | 106,374,232 | 106,374,232 | 6,111,200 | ||||||||||
Underwriting agreement, description | Under the underwriting agreement, the Company agreed to sell 91,111,111 units to the Underwriter, at a purchase price per unit of $2.0925 (the offering price to the public of $2.25 per unit minus the Underwriter’s discount), and also agreed to grant to the Underwriter a 30-day option to purchase up to 2,000,000 additional shares of common stock, at a purchase price of $2.0832 per share, and/or warrants to purchase up to 2,000,000 additional shares of common stock, at a purchase price of $0.0093 per warrant, in any combination thereof, solely to cover over-allotments, if any. The Underwriter exercised its option to purchase 2,000,000 additional warrants on May 28, 2021 and exercised its option to purchase 2,000,000 additional shares on June 3, 2021. | ||||||||||||
Shares of common stock sold | 91,111,111 | ||||||||||||
Warrants to purchase shares of common stock | 93,111,111 | ||||||||||||
Gross proceeds (in Dollars) | $ 205,020,000 | ||||||||||||
Net proceeds (in Dollars) | $ 194,597,500 | ||||||||||||
Shares of common stock connections with acquisitions | 5,895,973 | ||||||||||||
Shares of common stock remain available for issuance | 228,200 | 228,200 | |||||||||||
Purchase of shares of common stock | 555,000 | ||||||||||||
Common stock fair value (in Dollars) | $ 1,848,056 | ||||||||||||
Stock option expense (in Dollars) | $ 113,886 | $ 227,772 | |||||||||||
Remaining compensation expense (in Dollars) | $ 1,199,998 | $ 1,199,998 | |||||||||||
Remaining vesting period | 37 months | ||||||||||||
Warrants, description | pursuant to which a holder will not have the right to exercise any portion of the warrant if the holder (together with its affiliates) would beneficially own in excess of 4.99% of the number of shares of the Company’s common stock outstanding immediately after giving effect to the exercise, which such percentage may be increased or decreased to any other percentage not in excess of 9.99% upon 61 days’ notice to the Company. | ||||||||||||
Underwriter [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Shares of common stock sold | 2,000,000 | ||||||||||||
Gross proceeds (in Dollars) | $ 4,480,000 | ||||||||||||
Net proceeds (in Dollars) | $ 4,166,400 | ||||||||||||
Affiliated Entity [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Purchase shares of common stock | 55,560 | ||||||||||||
Exercise price per share (in Dollars per share) | $ 11.25 | ||||||||||||
Investor [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Purchase shares of common stock | 400,000 | ||||||||||||
Exercise price per share (in Dollars per share) | $ 12 | ||||||||||||
IPO [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Purchase shares of common stock | 93,111,111 | ||||||||||||
Exercise price per share (in Dollars per share) | $ 2.25 | $ 2.25 | |||||||||||
Directors and Officers [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Aggregate shares of common stock | 216,800 | ||||||||||||
Aggregate shares of common stock, value (in Dollars) | $ 555,000 | ||||||||||||
Minimum [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Reserved shares of common stock for issuance | 555,000 | ||||||||||||
Maximum [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Reserved shares of common stock for issuance | 1,000,000 | ||||||||||||
2020 Equity Incentive Plan [Member] | Subsequent Event [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Reserved shares of common stock for issuance | 555,000 | ||||||||||||
Common Stock [Member] | |||||||||||||
Stockholders' Deficit (Details) [Line Items] | |||||||||||||
Shares of common stock issued | 1,039,148 | 1,039,148 | |||||||||||
Exercise of warrants | 1,039,148 | ||||||||||||
Proceeds from warrants exercises (in Dollars) | $ 2,338,083 | ||||||||||||
Shares of common stock connections with acquisitions | 5,895,973 |
Stockholders' Deficit (Detail_2
Stockholders' Deficit (Details) - Schedule of activity relating to stock options | 6 Months Ended |
Jun. 30, 2021$ / sharesshares | |
Schedule of activity relating to stock options [Abstract] | |
Outstanding beginning balance, Shares | 555,000 |
Outstanding beginning balance, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 9 |
Outstanding beginning balance, Weighted Average Contractual Term in Years | 9 years |
Outstanding ending balance, Shares | 555,000 |
Outstanding ending balance, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 9 |
Outstanding ending balance, Weighted Average Contractual Term in Years | 8 years 6 months |
Exercisable, Shares | 65,790 |
Exercisable, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 9 |
Exercisable, Weighted Average Contractual Term in Years | 8 years 6 months |
Granted, Shares | |
Granted, Weighted Average Exercise Price (in Dollars per share) | $ / shares | |
Granted,Weighted Average Contractual Term in Years | |
Exercised, Shares | |
Exercised, Weighted Average Exercise Price (in Dollars per share) | $ / shares | |
Exercised, Weighted Average Contractual Term in Years | |
Forfeited / Cancelled / Expired, Shares | |
Forfeited / Cancelled / Expired, Weighted Average Exercise Price (in Dollars per share) | $ / shares | |
Forfeited / Cancelled / Expired, Weighted Average Contractual Term in Years (in Dollars per share) | $ / shares |
Stockholders' Deficit (Detail_3
Stockholders' Deficit (Details) - Schedule of activity relating to warrants | 6 Months Ended |
Jun. 30, 2021$ / sharesshares | |
Schedule of activity relating to warrants [Abstract] | |
Outstanding beginning balance, Shares | 55,560 |
Outstanding beginning balance, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 11.25 |
Outstanding beginning balance, Weighted Average Contractual Term in Years | 4 years 6 months |
Outstanding ending balance, Shares | 92,527,523 |
Outstanding ending balance, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 2.30 |
Outstanding ending balance, Weighted Average Contractual Term in Years | 5 years |
Granted, Shares | 93,511,111 |
Granted, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 2.25 |
Granted, Weighted Average Contractual Term in Years | 5 years |
Exercised, Shares | (1,039,148) |
Exercised, Weighted Average Exercise Price (in Dollars per share) | $ / shares | $ 2.25 |
Exercised,Weighted Average Contractual Term in Years | |
Cancelled / Expired, Shares | |
Cancelled / Expired, Weighted Average Exercise Price (in Dollars per share) | $ / shares | |
Cancelled / Expired, Weighted Average Contractual Term in Years |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Asset purchase agreement, description | Pursuant to the asset purchase agreement, Goedeker entitled to receive an earn out payment of $200,000 if the EBITDA (as defined in the asset purchase agreement) of the Goedeker Business for the trailing twelve (12) month period from April 5, 2022 is $2,500,000 or greater, and may be entitled to receive a partial earn out payment if the EBITDA of the Goedeker Business is less than $2,500,000 but greater than $1,500,000. |
Subsequent Events (Details)
Subsequent Events (Details) - Maria Johnson [Member] | 1 Months Ended |
Jul. 28, 2021$ / sharesshares | |
Subsequent Events (Details) [Line Items] | |
Purchase shares of common stock | shares | 150,000 |
Exercise price per share | $ / shares | $ 3.10 |
Vesting percentage | 25.00% |