Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 10, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Document Transition Report | false | |
Entity File Number | 001-40146 | |
Entity Registrant Name | FORIAN INC. | |
Entity Central Index Key | 0001829280 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 85-3467693 | |
Entity Address, Address Line One | 41 University Drive | |
Entity Address, Address Line Two | Suite 400 | |
Entity Address, City or Town | Newtown | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 18940 | |
City Area Code | 267 | |
Local Phone Number | 225-6263 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | FORA | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 32,644,828 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 12,309,300 | $ 18,663,805 |
Marketable securities | 11,581,855 | 12,399,361 |
Accounts receivable, net | 2,045,981 | 1,947,540 |
Contract assets | 1,746,171 | 1,056,891 |
Prepaid expenses | 1,258,238 | 1,017,927 |
Other assets | 384,313 | 900,242 |
Total current assets | 29,325,858 | 35,985,766 |
Property and equipment, net | 3,148,357 | 1,531,959 |
Intangible assets, net | 7,913,513 | 9,051,184 |
Goodwill | 9,099,372 | 9,099,372 |
Right of use assets, net | 735,164 | 859,637 |
Deposits and other assets | 285,801 | 314,443 |
Total assets | 50,508,065 | 56,842,361 |
Current liabilities: | ||
Accounts payable | 876,927 | 1,125,067 |
Accrued expenses | 3,697,186 | 4,068,109 |
Short-term operating lease liabilities | 246,501 | 247,325 |
Notes payable | 0 | 13,122 |
Warrant liability | 34,618 | 369,234 |
Deferred revenues | 2,984,880 | 976,268 |
Total current liabilities | 7,840,112 | 6,799,125 |
Long-term liabilities: | ||
Long-term operating lease liabilities | 491,199 | 611,523 |
Convertible notes payable, net of debt issuance costs ($6,000,000 in principal is held by a related party. Refer to Note 15) | 24,680,429 | 24,260,448 |
Total long-term liabilities | 25,171,628 | 24,871,971 |
Total liabilities | 33,011,740 | 31,671,096 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity: | ||
Preferred Stock; par value $0.001; 5,000,000 Shares authorized; 0 issued and outstanding as of June 30, 2022 and December 31, 2021 | 0 | 0 |
Common Stock; par value $0.001; 95,000,000 Shares authorized; 32,045,011 issued and outstanding as of June 30, 2022 and 31,773,154 issued and outstanding as of December 31, 2021 | 32,045 | 31,773 |
Additional paid-in capital | 67,572,043 | 57,959,622 |
Accumulated deficit | (50,107,763) | (32,820,130) |
Total stockholders' equity | 17,496,325 | 25,171,265 |
Total liabilities and stockholders' equity | $ 50,508,065 | $ 56,842,361 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Long-term liabilities: | ||
Net of debt issuance costs | $ 6,000,000 | $ 6,000,000 |
Stockholders' equity: | ||
Preferred Stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred Stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred Stock, shares issued (in shares) | 0 | 0 |
Preferred Stock, shares outstanding (in shares) | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common Stock, shares authorized (in shares) | 95,000,000 | 95,000,000 |
Common Stock, shares issued (in shares) | 32,045,011 | 31,773,154 |
Common Stock, shares outstanding (in shares) | 32,045,011 | 31,773,154 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues: | ||||
Total Revenues | $ 6,534,258 | $ 4,547,985 | $ 12,925,537 | $ 6,168,594 |
Costs and Expenses: | ||||
Cost of revenues | 1,746,808 | 1,232,790 | 3,314,357 | 1,690,676 |
Research and development | 3,387,053 | 1,949,926 | 6,609,924 | 3,447,764 |
Sales and marketing | 1,518,669 | 1,177,035 | 2,929,983 | 1,776,010 |
General and administrative | 4,870,157 | 6,577,696 | 10,958,611 | 9,362,258 |
Separation expenses | 0 | 0 | 5,611,857 | 0 |
Gain on sale of assets | 0 | 0 | (202,159) | 0 |
Depreciation and amortization | 604,122 | 595,488 | 1,209,796 | 783,072 |
Transaction related expenses | 0 | 0 | 0 | 1,210,279 |
Total costs and expenses | 12,126,809 | 11,532,935 | 30,432,369 | 18,270,059 |
Loss From Operations | (5,592,551) | (6,984,950) | (17,506,832) | (12,101,465) |
Other Income (Expense): | ||||
Change in fair value of warrant liability | 114,776 | (128,800) | 334,616 | 494,827 |
Interest and investment income | 18,954 | (20,446) | 23,442 | (19,205) |
Interest expense | (223,576) | 0 | (460,687) | 0 |
Foreign currency related gains | 253,852 | 169,256 | 331,828 | 145,250 |
Total other income, net | 164,006 | 20,010 | 229,199 | 620,872 |
Net loss before income taxes | (5,428,545) | (6,964,940) | (17,277,633) | (11,480,593) |
Income tax expense | (5,000) | 0 | (10,000) | 0 |
Net Loss | $ (5,433,545) | $ (6,964,940) | $ (17,287,633) | $ (11,480,593) |
Basic net loss per common share (in dollars per share) | $ (0.17) | $ (0.22) | $ (0.54) | $ (0.42) |
Diluted net loss per common share (in dollars per share) | $ (0.17) | $ (0.22) | $ (0.54) | $ (0.42) |
Weighted-average shares outstanding, basic (in shares) | 31,984,208 | 30,996,735 | 31,921,761 | 27,534,359 |
Weighted-average shares outstanding, diluted (in shares) | 31,984,208 | 30,996,735 | 31,921,761 | 27,534,359 |
Information and Software [Member] | ||||
Revenues: | ||||
Total Revenues | $ 6,084,439 | $ 3,763,671 | $ 11,893,533 | $ 5,172,649 |
Services [Member] | ||||
Revenues: | ||||
Total Revenues | 398,155 | 492,336 | 826,861 | 588,647 |
Other [Member] | ||||
Revenues: | ||||
Total Revenues | $ 51,664 | $ 291,978 | $ 205,143 | $ 407,298 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid In Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2020 | $ 0 | $ 21,233 | $ 17,514,907 | $ (6,269,025) | $ 11,267,115 |
Balance (in shares) at Dec. 31, 2020 | 0 | 21,233,039 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of Forian Common stock in Helix Acquisition | $ 0 | $ 8,408 | 18,446,376 | 0 | 18,454,784 |
Issuance of Forian Common stock in Helix Acquisition (in shares) | 0 | 8,408,383 | |||
Forian Restricted Stock Vesting from MOR unvested restricted stock | $ 0 | $ 343 | 5,102 | 0 | 5,445 |
Forian Restricted Stock Vesting from MOR unvested restricted stock (in shares) | 0 | 343,123 | |||
Issuance of common stock warrants | $ 0 | $ 0 | 389,976 | 0 | 389,976 |
Forian shares issued upon exercise of MOR Class B options | $ 0 | $ 10 | 292,820 | 0 | 292,830 |
Forian shares issued upon exercise of MOR Class B options (in shares) | 0 | 10,167 | |||
Issuance of Forian common stock | $ 0 | $ 1,192 | 11,967,460 | 0 | 11,968,652 |
Issuance of Forian common stock (in shares) | 0 | 1,191,743 | |||
Issuance of Forian common stock upon exercise of stock options | $ 0 | $ 13 | 35,607 | 0 | 35,620 |
Issuance of Forian common stock upon exercise of stock options (in shares) | 0 | 12,266 | |||
Stock based compensation expense | $ 0 | $ 0 | 3,612,728 | 0 | 3,612,728 |
Stock based compensation expense (in shares) | 0 | 0 | |||
Net loss | $ 0 | $ 0 | 0 | (11,480,593) | (11,480,593) |
Balance at Jun. 30, 2021 | $ 0 | $ 31,199 | 52,264,976 | (17,749,618) | 34,546,557 |
Balance (in shares) at Jun. 30, 2021 | 0 | 31,198,721 | |||
Balance at Dec. 31, 2020 | $ 0 | $ 21,233 | 17,514,907 | (6,269,025) | 11,267,115 |
Balance (in shares) at Dec. 31, 2020 | 0 | 21,233,039 | |||
Balance at Dec. 31, 2021 | $ 0 | $ 31,773 | 57,959,622 | (32,820,130) | 25,171,265 |
Balance (in shares) at Dec. 31, 2021 | 0 | 31,773,154 | |||
Balance at Mar. 31, 2021 | $ 0 | $ 29,824 | 37,510,532 | (10,784,678) | 26,755,678 |
Balance (in shares) at Mar. 31, 2021 | 0 | 29,824,424 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Forian Restricted Stock Vesting from MOR unvested restricted stock | $ 0 | $ 170 | 2,532 | 0 | 2,702 |
Forian Restricted Stock Vesting from MOR unvested restricted stock (in shares) | 0 | 170,288 | |||
Issuance of Forian common stock | $ 0 | $ 1,192 | 11,967,460 | 0 | 11,968,652 |
Issuance of Forian common stock (in shares) | 0 | 1,191,743 | |||
Issuance of Forian common stock upon exercise of stock options | $ 0 | $ 13 | 35,607 | 0 | 35,620 |
Issuance of Forian common stock upon exercise of stock options (in shares) | 0 | 12,266 | |||
Stock based compensation expense | $ 0 | $ 0 | 2,748,845 | 0 | 2,748,845 |
Stock based compensation expense (in shares) | 0 | 0 | |||
Net loss | $ 0 | $ 0 | 0 | (6,964,940) | (6,964,940) |
Balance at Jun. 30, 2021 | $ 0 | $ 31,199 | 52,264,976 | (17,749,618) | 34,546,557 |
Balance (in shares) at Jun. 30, 2021 | 0 | 31,198,721 | |||
Balance at Dec. 31, 2021 | $ 0 | $ 31,773 | 57,959,622 | (32,820,130) | 25,171,265 |
Balance (in shares) at Dec. 31, 2021 | 0 | 31,773,154 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Vesting of Restricted Stock and Stock Awards, net of shares surrendered for taxes | $ 0 | $ 264 | (58,349) | 0 | (58,085) |
Vesting of Restricted Stock and Stock Awards, net of shares surrendered for taxes (in shares) | 0 | 263,743 | |||
Issuance of Forian common stock upon exercise of stock options | $ 0 | $ 8 | (8) | 0 | 0 |
Issuance of Forian common stock upon exercise of stock options (in shares) | 0 | 8,114 | |||
Stock based compensation expense | $ 0 | $ 0 | 9,670,778 | 0 | 9,670,778 |
Stock based compensation expense (in shares) | 0 | 0 | |||
Net loss | $ 0 | $ 0 | 0 | (17,287,633) | (17,287,633) |
Balance at Jun. 30, 2022 | $ 0 | $ 32,045 | 67,572,043 | (50,107,763) | 17,496,325 |
Balance (in shares) at Jun. 30, 2022 | 0 | 32,045,011 | |||
Balance at Mar. 31, 2022 | $ 0 | $ 31,929 | 65,864,050 | (44,674,218) | 21,221,761 |
Balance (in shares) at Mar. 31, 2022 | 0 | 31,928,701 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Vesting of Restricted Stock and Stock Awards, net of shares surrendered for taxes | $ 0 | $ 108 | (58,193) | 0 | (58,085) |
Vesting of Restricted Stock and Stock Awards, net of shares surrendered for taxes (in shares) | 0 | 108,196 | |||
Issuance of Forian common stock upon exercise of stock options | $ 0 | $ 8 | (8) | 0 | 0 |
Issuance of Forian common stock upon exercise of stock options (in shares) | 0 | 8,114 | |||
Stock based compensation expense | $ 0 | $ 0 | 1,766,194 | 0 | 1,766,194 |
Stock based compensation expense (in shares) | 0 | 0 | |||
Net loss | $ 0 | $ 0 | 0 | (5,433,545) | (5,433,545) |
Balance at Jun. 30, 2022 | $ 0 | $ 32,045 | $ 67,572,043 | $ (50,107,763) | $ 17,496,325 |
Balance (in shares) at Jun. 30, 2022 | 0 | 32,045,011 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
Net loss | $ (5,433,545) | $ (6,964,940) | $ (17,287,633) | $ (11,480,593) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||
Depreciation and amortization | 1,209,796 | 783,072 | |||
Amortization on right of use asset | 124,473 | 94,010 | |||
Gain on sale of assets | 0 | 0 | (202,159) | 0 | |
Amortization of debt issuance costs | 2,666 | 0 | |||
Accrued interest on Convertible Notes | 417,315 | 0 | |||
Realized and unrealized gain on marketable securities | (22,043) | (2,331) | |||
Provision for doubtful accounts | 73,402 | 50,813 | |||
Stock-based compensation expense | 9,670,778 | 3,618,173 | |||
Change in fair value of warrant liability | (114,776) | 128,800 | (334,616) | (494,827) | |
Issuance of warrants in connection with transaction expenses | 0 | 389,976 | $ 389,976 | ||
Change in operating assets and liabilities: | |||||
Accounts receivable | (184,252) | (929,641) | |||
Contract assets | (689,280) | (108,808) | |||
Prepaid expenses | (240,311) | (594,129) | |||
Changes in lease liabilities during the period | (121,148) | (105,378) | |||
Deposits and other assets | 544,571 | (344,338) | |||
Accounts payable | (248,140) | (1,099,124) | |||
Accrued expenses | (370,923) | 1,865,826 | |||
Deferred revenues | 2,008,612 | 179,074 | |||
Net cash used in operating activities | (5,648,892) | (8,178,225) | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
Additions to property and equipment | (1,699,530) | (328,303) | |||
Proceeds from sale of assets | 225,575 | 0 | |||
Purchase of marketable securities | (23,959,558) | (12,504,788) | |||
Sale of marketable securities | 24,799,107 | 11,503,845 | |||
Cash acquired as part of business combination | 0 | 1,310,977 | |||
Net cash used in investing activities | (634,406) | (18,269) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
Proceeds from exercise of MOR Class B options | 0 | 292,830 | |||
Payments on notes payable and financing arrangements | (13,122) | (2,747) | |||
Payment of employee withholding tax related to restricted stock units | (58,085) | 0 | |||
Proceeds from exercise of common stock options | 0 | 35,620 | |||
Proceeds from sale of common stock | 0 | 11,968,652 | |||
Net cash (used in) provided by financing activities | (71,207) | 12,294,355 | |||
Net change in cash | (6,354,505) | 4,097,861 | |||
Cash and cash equivalents, beginning of period | 18,663,805 | 665,463 | 665,463 | ||
Cash and cash equivalents, end of period | $ 12,309,300 | $ 4,763,324 | 12,309,300 | 4,763,324 | $ 18,663,805 |
Supplemental disclosure of cash flow information: | |||||
Cash paid for interest | 0 | 724 | |||
Cash paid for taxes | 2,550 | 0 | |||
Non-cash Investing Activities: | |||||
Non-cash consideration for Helix acquisition | $ 0 | $ 18,454,784 |
BUSINESS ORGANIZATION AND NATUR
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS | 6 Months Ended |
Jun. 30, 2022 | |
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS [Abstract] | |
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS | Note 1 BUSINESS ORGANIZATION AND NATURE OF OPERATIONS Forian Inc. (the “Company” or “Forian”) was incorporated in Delaware on October 15, 2020 as a wholly owned subsidiary of Medical Outcomes Research Analytics, LLC (“MOR”) for the purpose of effecting the Business Combination (as defined below). All activity of the Company through March 2, 2021 relates only to MOR. MOR was established on May 6, 2019 in Delaware. The Company provides innovative software solutions, proprietary data and predictive analytics to optimize the operational, clinical and financial performance of its customers within the healthcare and cannabis industries. The Company’s mission is to provide its customers with the best-in-class critical technology services through a single integrated platform that enables its customers to operate their businesses more safely, efficiently and profitably and to serve its customers and its customers’ stakeholders and constituencies more comprehensively. The Company represents the unique convergence of proprietary healthcare and consumer data, innovative data management capabilities and intelligent data science with a leading cannabis technology platform yielding the combined power to drive innovation and transparency across the industries it serves. On March 2, 2021 (the “Merger Closing Date”), pursuant to the Agreement and Plan of Merger, dated as of October 16, 2020, as amended by Amendment to Agreement and Plan of Merger, dated as of December 31, 2020, as further amended by Amendment No. 2 to Agreement and Plan of Merger, dated February 9, 2021 (together, the “Merger Agreement”), by and among Helix Technologies, Inc. (“Helix”), the Company and DNA Merger Sub, Inc., a wholly owned subsidiary of the Company (“Merger Sub”), Merger Sub merged with and into Helix, with Helix being the surviving corporation as a wholly owned subsidiary of the Company (the “Merger”). Each share of Helix common stock was exchanged for 0.05 shares of Company common stock in the Merger. Helix provides traceability and point of sale technology, analytics solutions and other products to customers within each vertical of the cannabis industry to help them improve the performance of their business. Immediately prior to the Merger Closing Date, pursuant to the Equity Interest Contribution Agreement, dated March 2, 2021 (the “Contribution Agreement”), by and among the Company, MOR and each equity holder of MOR, such equity holders contributed their interests in MOR to the Company in exchange for shares of Company common stock (the “Contribution” and, together with the Merger, the “Business Combination”). Upon the closing of the Contribution, MOR became a wholly owned subsidiary of the Company. Each unit of MOR was exchanged for 1.7776 shares of Company common stock in the Merger, subject to adjustments pursuant to the Contribution Agreement. Pursuant to the Merger Agreement, while the Company is the legal acquirer, the Merger was accounted for as a reverse acquisition using the acquisition method of accounting in accordance with Accounting Standards Codification (“ASC”) Topic 805, Business Combinations |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2022 | |
BASIS OF PRESENTATION [Abstract] | |
BASIS OF PRESENTATION | Note 2 BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain footnotes and other financial information normally required by U.S. GAAP have been condensed or omitted in accordance with instructions to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, such statements include all adjustments which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of June 30, 2022. The operating results presented herein are not necessarily an indication of the results that may be expected for the year. The condensed consolidated financial statements should be read in conjunction with the Company’s audited Consolidated Financial Statements included in its Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the Securities and Exchange Commission (“SEC”) on March 31, 2022. The Contribution was completed on March 2, 2021 and the combination of MOR and Forian was accounted for as a transaction between entities under common control pursuant to ASC 805-50. Accordingly, the combination of Forian and MOR results in a change in reporting entity and the financial statements are presented as though the combination of Forian and MOR occurred as of the beginning of the periods presented. Additionally, the results of Helix are included in the accompanying condensed consolidated financial statements beginning on March 2, 2021, the Merger Closing Date. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Note 3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of (i) Medical Outcomes Research Analytics, LLC and its wholly owned subsidiaries COR Analytics, LLC and MOR Analytics, LLC, and (ii) Helix Technologies, Inc. and its wholly owned subsidiaries Helix TCS, LLC, Security Consultants Group, LLC, Security Grade Protective Services, Ltd., Bio-Tech Medical Software, Inc., Engeni LLC (including Engeni S.A. (“Engeni SA”), which is 99% owned by Engeni LLC), Green Tree International, Inc., Boss Security Solutions, Inc., BT UCS, Inc. and AIE Exchange Canada, Inc. Effective October 7, 2021, AIE Exchange Canada, Inc. was voluntarily dissolved. Effective December 31, 2021, (i) each of COR Analytics, LLC and MOR Analytics, LLC was merged with and into Medical Outcomes Research Analytics, LLC and (ii) each of BT UCS, Inc. and BOSS Security Solutions was merged with and into Security Grade Protective Services, Ltd., which entity was re-domesticated from Colorado to Delaware and renamed Helix Legacy, Inc. All intercompany transactions have been eliminated in consolidation. The financial results of Helix and its subsidiaries are included in the condensed consolidated financial statements beginning on March 2, 2021, the Merger Closing Date. Foreign Currency ASC Topic 830-10, Foreign Currency Matters Use of Estimates Preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgements and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses together with amounts disclosed in related notes to the financial statements. The significant areas of estimation include, but are not limited to, accounting for allowance for doubtful accounts, income taxes, depreciation, amortization of intangible assets, contingencies and stock-based compensation. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is possible that the external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates. Reclassifications Certain reclassifications have been made to the prior period financial statements to conform to the current period financial statement presentation. Foreign currency related gains were reclassified from other comprehensive income to other income (expense) for Engeni SA, the Company’s Argentinian subsidiary, which operates in a highly inflationary country. Fair Value of Financial Instruments The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820, Fair Value Measurements and Disclosures (“ASC 820”) ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an ordinary transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 — quoted prices in active markets for identical assets or liabilities; Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable; and Level 3 — inputs that are unobservable. The carrying value of the Company’s financial instruments, such as cash, marketable securities, accounts receivable and accrued liabilities and other liabilities approximate fair values due to the short-term nature of these instruments. The estimated fair value of the Company’s warrant liability as of June 30, 2022 and December 31, 2021 was $34,618 and $369,234, respectively, based on Level 3 inputs. Cash and Cash Equivalents and Credit Risk The Company considers all cash accounts that are not subject to withdrawal restrictions and highly liquid investments with a maturity of three months or less, when purchased, as cash and cash equivalents. The Company maintains cash with major financial institutions. Cash held at U.S. bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. The portion of deposits in excess of FDIC coverage is not protected by such insurance and represents a credit risk to the Company. At times, the Company’s deposits exceed this coverage. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of an allowance for doubtful accounts. The Company determines the allowance for doubtful accounts based on historical write-off experience, customer specific facts and economic conditions. Outstanding account balances are reviewed individually for collectability. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. Allowance for doubtful accounts was $286,416 and $350,991 at June 30, 2022 and December 31, 2021, respectively. Management charges account balances against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Long-Lived Assets, Including Definite Lived Intangible Assets Long-lived assets, other than goodwill and other indefinite-lived intangibles, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable through the estimated undiscounted future cash flows derived from such assets. Definite-lived intangible assets primarily consist of customer relationships, software technology and trade names. For long-lived assets used in operations, impairment losses are only recorded if the asset’s carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are written down to fair value. Goodwill Goodwill consists of the excess of cost over the fair value of net assets acquired in business combinations. Goodwill is not amortized. Instead, it is tested annually for impairment, or more frequently if events occur or circumstances change that would more likely than not reduce its fair value below its carrying amount. All goodwill is reported in the Information and Software reporting unit. Goodwill is evaluated for impairment annually or whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. The qualitative factors considered by Forian may include, but are not limited to, general economic conditions, the Company’s outlook, market performance of the Company’s industry and recent and forecasted financial performance. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that a reporting unit’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The Company has the option to first assess qualitative factors to determine whether events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount and to determine whether further action is needed. If, after assessing the totality of events or circumstances, the Company determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary. An impairment charge is recognized when the fair value of the Company’s goodwill is less than its carrying amount. No impairment losses have been recognized during the periods presented. Business Combinations The Company accounts for its business combinations under the provisions of ASC Topic 805-10, which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including non-controlling interests, are recorded at the date of acquisition at their respective fair values. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized separately from the business combinations and are expensed as incurred. If the business combination provides for contingent consideration, the Company records the contingent consideration at fair value at the acquisition date and any changes in fair value after the acquisition date are accounted for as measurement-period adjustments. Changes in fair value of contingent consideration resulting from events after the acquisition date, such as earn-outs, are recognized as follows: (i) if the contingent consideration is classified as equity, the contingent consideration is not re-measured and its subsequent settlement is accounted for within equity; or (ii) if the contingent consideration is classified as a liability, the changes in fair value are recognized in earnings. Revenue Recognition The Company recognizes revenue in accordance with Financial Accounting Standards Board (“FASB”) Topic 606, Revenue from Contracts with Customers Under ASC 606, the Company recognizes revenue when (or as) customers obtain control of promised goods or services, in an amount that reflects the consideration which is expected to be received in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed under ASC 606: (i) identify contract(s) with a customer; (ii) identify the performance obligation(s) in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligation(s) in the contract; and (v) recognize revenues when (or as) the Company satisfies a performance obligation. The Company applies the provisions of ASC 606 to an arrangement when a substantive contract exists and collectability is probable. The Company generates revenue from the following categories of offerings: Information and Software subscriptions, Services and Other products. The Company derives Information and Software revenue primarily from license fees for the Company’s Information products and subscription revenue for the Company’s Software products. Information products contracts are generally for a period of one month to five years. Information products’ customers may access data analytics products through the use of tools provided by the Company or by utilizing their own tools per the contract. Data products may consist of historical information as it exists at the time of delivery or information that will be updated over a period of time as agreed with the customer. In most cases, the provision of information products is considered a single performance obligation. In cases where the Company is not obligated to update information over the access period, and control over the use of the products passes to the customer when delivered, revenue is recognized when the information products are made available to the customer. In cases where information updates are provided over the contract term, they are considered highly interrelated with the information product delivered upon contract inception, and revenue is recognized ratably over the life of non-cancellable periods of the contract. Customers are generally invoiced according to monthly or annual amounts specified in the contract. Any amounts invoiced in excess of revenue recognized are recorded as deferred revenue. Revenue recognized in excess of amounts invoiced is recorded as a contract asset. Software revenue is primarily comprised of subscriptions to point of sale and business intelligence products and related hosting services. Subscription revenue is considered a single performance obligation recognized ratably over the term of the contract, beginning when access to the applicable software is provided to the customer. Customers are typically billed at the beginning of each month under agreements, which the customer may cancel with 30 days’ notice. When collection of fees occurs in advance of service delivery, revenue recognition is deferred until such services commence. Revenue for implementation fees is recognized as training and installation services are performed. Services revenues are primarily from fixed price contracts with government agencies where amounts are billed upon completion of the milestones within the contract. Revenue is recognized as the company satisfies its performance obligations under the contract. In the event that a contract does not specifically allocate revenue to the satisfaction of specific performance obligations or milestones, the transaction price is allocated based on the percentage of time spent, or expected to be spent, to meet each performance obligation. Initial customization of the software to meet state specific requirements and the training to appropriately utilize the software are generally recognized upon completion of the customization and acceptance by the state agency. Support and service revenues are then recognized over a predetermined period of time as defined in the contract. Contract renewals may include an annual service fee that is recognized over the time period defined in the contract. Other revenues are primarily from security monitoring services offerings and the provision of web marketing services. Contracts for these services have a stated transaction price for monthly services and are recognized as the services are provided. In some cases, contracts provide for variable consideration that is contingent upon the occurrence of uncertain future events, which can either increase or decrease the transaction price, including sales of products by customers derived from data analytics products the Company provides. Variable consideration based on sales of products by customers is recognized in the period of sales, subject to minimum amounts specified in contracts. Variable consideration is estimated at the expected value or at the most likely amount depending on the type of consideration. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimate of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of anticipated performance and all information (historical, current and forecasted) that is reasonably available to the Company and reevaluated each reporting period. The effect of revisions in recognized estimated variable consideration in excess of minimums are recorded beginning in the period in which the estimates are revised. Actual results could differ from periodic estimates. Significant judgments and estimates are sometimes necessary for the determination of whether performance obligations in a contract are distinct and whether they are delivered at a point in time or over time. Judgement is also necessary to assess revenue recognized under contingent revenue arrangements. Contract acquisition costs, which consist of sales commissions paid or payable, are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial and renewal contracts are deferred and then amortized on a straight-line basis over the contract term. Contract assets and deferred revenues consist of the following as of June 30, 2022: Contract Assets Contract Liability Costs of obtaining contracts Unbilled revenue Total Deferred Revenue Balance at January 1, 2021 $ 53,784 $ 142,917 $ 196,701 $ 158,884 Acquired from Helix — 20,128 20,128 320,936 Acquired balances recognized during period — (20,128 ) (20,128 ) (263,787 ) Beginning deferred revenue balance recognized during the period — — — (158,884 ) Net change due to timing of billings, payments and recognition 16,494 843,696 860,190 919,119 Balance at December 31, 2021 70,278 986,613 1,056,891 976,268 Beginning deferred revenue balance recognized during the period — — — (773,629 ) Net change due to timing of billings, payments and recognition 115,488 573,792 689,280 2,782,241 Balance at June 30, 2022 $ 185,766 $ 1,560,405 $ 1,746,171 $ 2,984,880 Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. The majority of the Company’s noncurrent remaining performance obligations will be recognized over the next 36 months. The transaction price allocated to remaining performance obligations consisted of the following: June 30, 2022 December 31, 2021 Estimated next twelve months $ 12,827,702 $ 8,525,736 Thereafter 10,590,820 11,424,934 Total $ 23,418,522 $ 19,950,670 Remaining performance obligations include $2,984,880 and $976,268 of billed and deferred revenue at June 30, 2022 and December 31, 2021, respectively. The Company’s disaggregated revenue categories as of June 30, 2022 and 2021 are as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Healthcare Information $ 3,602,913 $ 1,382,511 $ 7,137,774 $ 1,956,347 Software Subscriptions 2,481,526 2,381,160 4,755,759 3,216,302 Services 398,155 492,336 826,861 588,647 Other 51,664 291,978 205,143 407,298 Total $ 6,534,258 $ 4,547,985 $ 12,925,537 $ 6,168,594 Segment Information ASC 280, Segment Reporting Customer Concentration The Company did not have any customers that exceeded 10% of total revenue for the three and six months ended June 30, 2022 or 2021. Concentration of Vendors The Company licenses certain information assets from third parties as a key input to certain Information and Software Products. While information licensing fees represented less than 10% of the Company’s operating expenses for the and months ended June and any disruption associated with these suppliers could have a material short-term impact on the business while alternate sources are secured. During the and months ended June the Company had vendors representing 22% and 15% and and 16% of purchases for outside development and cloud computing services, respectively. Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation, which is recorded commencing at the in-service date using the straight-line method at rates sufficient to charge the cost of depreciable assets to operations over their estimated useful lives, which are 1 to 7 years. Maintenance and repairs are charged to operations as incurred. The Company reviews for the impairment of long-lived assets annually and whenever events and or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Such indicators include, among others, the nature of the asset, the projected future economic benefit of the asset, historical and future cash flows and profitability measurements. An impairment loss would be recognized when the value of the undiscounted estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than the carrying value. There were no impairment losses recognized during the and months ended June and Software Development Costs T he Company accounts for costs incurred in the development of computer software in accordance with ASC Subtopic - Intangibles – Goodwill and Other – Internal-Use Software and ASC Subtopic - Software –Costs of Software to be Sold, Leased or Marketed . Product development costs are primarily related to Company personnel and contractors for design and evaluating software development, testing, bug fixes, and other maintenance activities. Product development costs incurred in the application development stage for internal use software are subject to capitalization and subsequent amortization, and possible impairment. Product development costs not pertaining to the application development stage are expensed as incurred. The Company capitalized software development costs of and during the months ended June and respectively. Contingencies Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that it is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s condensed consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. Advertising Advertising costs are expensed as incurred and included in sales and marketing expenses and amounted to and for the and months ended June respectively, and and for the and months ended June respectively. Net Loss per Share Net loss per share of common stock is computed by dividing net loss by the weighted average number of common shares outstanding during the period. At June 30, 2022, the Company had potentially dilutive securities that could be exercised or converted into common stock. Refer to Note 14 for the Company’s disclosure on such potential dilution. Further, as the Company has incurred net losses for the three and six months ended June 30, 2022 and 2021, respectively, the diluted loss per share is the same as basic loss per share for the periods presented. Distinguishing Liabilities from Equity The Company relies on the guidance provided by ASC Topic 480, Distinguishing Liabilities from Equity Derivatives and Hedging: Contracts in Entity’s Own Equity Once the Company determines that a financial instrument should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability section and the equity section of the balance sheet (“temporary equity”). The Company will determine temporary equity classification if the redemption of the financial instrument is outside the control of the Company (i.e. at the option of the holder). Otherwise, the Company accounts for the financial instrument as permanent equity. Initial Measurement The Company records its financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received. Subsequent Measurement – Financial instruments classified as liabilities The Company records the fair value of its financial instruments classified as liabilities at each subsequent measurement date. The changes in fair value of its financial instruments classified as liabilities are recorded as other expense/income. Stock-based Compensation The Company’s 2020 Equity Incentive Plan (“2020 Plan”) permits the grant of stock options, restricted stock awards and/or restricted stock units. A total of 4,000,000 shares of Company common stock were originally authorized and reserved for issuance under the 2020 Plan. On June the Company’s stockholders approved an amendment to the Plan, which amended the Plan to increase the number of shares available for issuance by shares to a total of 6,400,000 shares. Income Taxes MOR was organized as a limited liability company and became a wholly owned subsidiary of the Company upon completion of the Merger with Helix on March 2, 2021. As a result, the Company was treated as a partnership for federal and state income tax purposes through March 2, 2021. Accordingly, the Company’s taxable income, deductions, assets and liabilities are reported by the members on their respective income tax returns. Therefore, no provision for federal or state income tax has been made by the Company for all business activity from its inception through March 2, 2021. After March 2, 2021, the Company accounts for income taxes in accordance with FASB ASC 740 (“ASC 740”). Deferred income tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Tax contingencies are recorded, if needed, to address potential exposure involving tax positions the Company has taken that could be challenged by tax authorities. These potential exposures could result from applications of various statutes, rules, regulations and interpretations. Any estimates of tax contingencies contain assumptions and judgments about potential actions by taxing jurisdictions. Any interest and penalties related to uncertain tax positions would be included as part of the income tax provision. The Company’s conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analysis of or changes in tax laws, regulations and interpretations thereof as well as other factors. The Company recorded a provision for state taxes of and for the and months ended June respectively, and for the and months ended June Gain on Sale of Assets On March 3, 2022, the Company sold certain assets, consisting of customer contracts, accounts receivable, and other property related to its security monitoring services for $225,575 resulting in a gain of $202,159, which is included in operating expenses in the condensed consolidated statements of operations for the months ended June Separation Expenses During March 2022, the Company transferred certain development activities from its Engeni SA subsidiary to outsourced development facilities. As a result, the Company incurred $194,814 in severance and related costs to be recorded as a charge to operating expenses in during the months ended June On March 2, 2022, the Company and two advisors agreed not to renew special advisor agreements between the advisors and the Company. The advisors were the former chief executive officer and the former chief financial officer of Helix who were granted stock options in conjunction with their respective advisory agreements that were entered into upon the completion of the Helix acquisition. The Company and the advisors mutually agreed not to renew the advisory agreements. The services provided by these advisors included transition planning and consulting services related to integration of the business operations of Helix and Forian. Per the terms of the agreements, options to purchase 366,166 shares of common stock will continue to vest according to their original terms through March 2, 2023, and unvested stock options to purchase 732,332 shares of common stock were forfeited. The advisors are not required to perform services to the Company beyond the non-renewal date of March 2, 2022. As a result, the Company recorded $5,417,043 of stock compensation expenses related to the options that will vest over the twelve months ending March 2, 2023 during March 2022. Foreign Currency Related Gains Foreign currency related gains result from foreign currency transactions and translation gains related to our Engeni SA subsidiary. Recent Accounting Pronouncements In October 2021, the FASB issued Accounting Standards Update No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 6 Months Ended |
Jun. 30, 2022 | |
BUSINESS COMBINATION [Abstract] | |
BUSINESS COMBINATION | Note 4 BUSINESS COMBINATION On March 2, 2021, pursuant to the Merger and the Merger Agreement, Forian acquired 100% of the issued and outstanding capital stock, options and warrants of Helix. The total purchase consideration for the Merger was $18,454,784. The purchase consideration is equal to the product of (i) the total outstanding Helix common shares and common share equivalents for in-the-money warrants to purchase Helix common stock and vested stock options multiplied by the merger exchange ratio of 0.05 shares of Company common stock for 1 share of Helix common stock and (ii) $2.158 per share, which represented the fair value of Company common stock on the acquisition date. The Merger was accounted for as a business combination in accordance with ASC 805. The Company has determined fair values of the assets acquired and liabilities assumed in the Merger. The following table summarizes the purchase price allocations relating to the Merger: Total purchase price $ 18,454,784 Assets acquired: Cash 1,310,977 Accounts receivable, net 488,453 Prepaid expenses 215,064 Contract assets 20,128 Other assets 450,000 Property and equipment 146,559 Software Technology 5,279,000 Trade Names and Trademarks 386,000 Customer Relationships 5,269,000 Right of use assets 1,082,684 Deposits and other assets 58,950 Total assets acquired $ 14,706,815 Liabilities assumed: Accounts payable $ 681,879 Accrued expenses 1,972,663 Short-term lease liabilities 295,364 Deferred revenues 320,936 Warrant liability 1,247,715 Notes payable and financing arrangements 20,801 Other long-term liabilities 812,045 Total liabilities assumed $ 5,351,403 Estimated fair value of net assets acquired: $ 9,355,412 Goodwill $ 9,099,372 The estimates for useful lives of the identified intangibles are 8 years for Trade Names and Trademarks, 5 years for Customer Relationships and 2 and 7 years for Software Technology Intangibles with a weighted average useful life of 5.47 years. Transaction costs incurred in connection with the Business Combination amounted to $0 and $1,210,279 for the months ended June and respectively. Unaudited Pro Forma Financial Information T he following table represents the revenue, net loss and loss per share effect of the acquired company, as reported on a pro forma basis as if the acquisition occurred on January These pro forma results are not necessarily indicative of the results that would have occurred if the acquisition had occurred on the day of the periods presented, nor does the pro forma financial information purport to represent the results of operations for future periods. For the Months Ended June Description 2021 Revenues $ 8,177,506 Net loss $ (14,224,446 ) Net loss per share: Basic and diluted-as pro forma (unaudited) $ (0.47 ) The pro forma financial information for all periods presented above has been calculated after adjusting the results of the Company and Helix to reflect the business combination accounting effects resulting from this acquisition, including the amortization expense from acquired intangible assets included in the pro forma financial information presented above. The Forian historical condensed consolidated financial statements have been adjusted in the pro forma combined financial statements to give effect to pro forma events that are directly attributable to the business combination and factually supportable. The pro forma financial information is for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the periods presented. |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 6 Months Ended |
Jun. 30, 2022 | |
MARKETABLE SECURITIES [Abstract] | |
MARKETABLE SECURITIES | Note 5 MARKETABLE SECURITIES Marketable securities are stated at estimated fair value based upon current market quotes (level 1 inputs) and are classified as available-for-sale. Realized gains and losses are included in investment income. Unrealized gains and losses are immaterial and therefore the Company has presented such amounts within Investment income in the Statement of Operations. The Company invests in short-term U.S. Treasuries and money market mutual funds. As of June 30, 2022 and 2021, the fair value of these investments approximated cost. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 6 Months Ended |
Jun. 30, 2022 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | Note 6 PREPAID EXPENSES AND OTHER CURRENT ASSETS The Company has various agreements which require upfront and periodic payments. The Company records the expenses related to these agreements ratably over the annual terms. As of June 30, 2022 and December 31, 2021, the Company’s balance sheet reflected other prepaid expenses of $1,258,238 and $1,017,927, respectively, primarily relating to various software licenses and insurance policies with durations ranging from 3 months to 1 year. Included in other current assets as of June 30, 2022 are amounts receivable from employees totaling $384,313. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 6 Months Ended |
Jun. 30, 2022 | |
PROPERTY AND EQUIPMENT, NET [Abstract] | |
PROPERTY AND EQUIPMENT, NET | Note 7 PROPERTY AND EQUIPMENT, NET As of June 30, 2022 and December 31, 2021, property and equipment were comprised of the following: June 30, 2022 December 31, 2021 Personal computing equipment $ 195,089 $ 131,137 Furniture and equipment 127,802 119,381 Software development costs 2,985,827 1,338,044 Vehicles — 25,876 Total 3,308,718 1,614,438 Less: Accumulated depreciation and amortization (160,361 ) (82,479 ) Property and equipment, net $ 3,148,357 $ 1,531,959 Depreciation and amortization expense for the three and six months ended June 30, 2022 was $35,286 and $ , |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 6 Months Ended |
Jun. 30, 2022 | |
INTANGIBLE ASSETS, NET [Abstract] | |
INTANGIBLE ASSETS, NET | Note 8 INTANGIBLE ASSETS, NET The following tables summarize the Company’s intangible assets as of June 30, 2022 and December 31, 2021: Estimated Useful Life (Years) Gross Carrying Amount at December 31, 2021 Accumulated Amortization Net Book Value at June 30, Customer Relationships 5 $ 5,269,000 $ (1,400,056 ) $ 3,868,944 Software Technology 2 1,170,000 (776,825 ) 393,175 Software Technology 7 4,109,000 (779,519 ) 3,329,481 Tradenames and Trademarks 8 386,000 (64,087 ) 321,913 $ 10,934,000 $ (3,020,487 ) $ 7,913,513 Estimated Useful Life (Years) Gross Carrying Amount at March 2, 2021 Accumulated Amortization Net Book Value at December 31, 2021 Customer Relationships 5 $ 5,269,000 $ (872,501 ) $ 4,396,499 Software Technology 2 1,170,000 (484,355 ) 685,645 Software Technology 7 4,109,000 (486,011 ) 3,622,989 Tradenames and Trademarks 8 386,000 (39,949 ) 346,051 $ 10,934,000 $ (1,882,816 ) $ 9,051,184 The Company uses the straight-line method to determine the amortization expense for its definite lived intangible assets. Amortization expense related to the purchased intangible assets was $568,836 and $1,137,671 for the three and six months ended June 30, 2022, respectively, and $567,213 and $744,086 for the three and six months ended June 30, 2021, respectivel . The estimated future amortization expense for the next five years and thereafter is as follows: Years Ending December 31, Future amortization expense 2022 (Remaining) $ 1,136,379 2023 1,789,695 2024 1,689,050 2025 1,689,050 2026 816,549 Thereafter 792,790 Total $ 7,913,513 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2022 | |
ACCRUED EXPENSES [Abstract] | |
ACCRUED EXPENSES | Note 9 ACCRUED EXPENSES As of June 30, 2022 and December 31, 2021, accrued expenses were comprised of the following: June 30, 2022 December 31, 2021 Accrued salary, commission and bonus $ 1,828,832 $ 2,046,584 Accrued expenses 1,868,354 2,021,525 Total $ 3,697,186 $ 4,068,109 |
WARRANT LIABILITY
WARRANT LIABILITY | 6 Months Ended |
Jun. 30, 2022 | |
WARRANT LIABILITY [Abstract] | |
WARRANT LIABILITY | Note 10 WARRANT LIABILITY In conjunction with the Merger, outstanding warrants to purchase Helix common stock were converted to warrants to purchase Company common stock. As the warrant holders have the option to receive cash in lieu of common stock in certain circumstances, the Company determined that the warrants require classification as a liability pursuant to ASC 815-40. In accordance with the applicable accounting guidance, the outstanding warrants are recognized as a warrant liability on the condensed consolidated balance sheet and are measured at their inception date fair value (the closing date of the Merger) and subsequently re-measured at each reporting period with changes being recorded in the condensed consolidated statement of operations. As of June 30, 2022, the Company had 92,058 warrants outstanding classified as liabilities. The fair value of the Company’s warrant liability was calculated using the Black-Scholes model and the following assumptions: As of June 30, 2022 As of December 31, 2021 Fair value of company's common stock $ 4.39 $ 9.02 Dividend yield 0 % 0% Expected volatility 80% - 102 % 118% - 149% Risk Free interest rate 2.63% - 2.95 % 0.06% - 0.97% Expected life (years) 1.41 1.82 Exercise price $ 8.00 - $28.00 $ 8.00 - $28.00 Fair value of financial instruments - warrants $ 34,618 $ 369,234 The change in fair value of the financial instruments – warrants is as follows: Amount Balance as of January 1, 2022 $ 369,234 Change in fair value of warrant liability (334,616 ) Balance as of June 30 2022 $ 34,618 Amount Balance as of January 1, 2021 $ — Fair value of warrant liability assumed in connection with Helix Merger 1,247,715 Change in fair value of warrant liability (494,827 ) Balance as of June 30 2021 $ 752,888 Amount Balance as of April 1, 2022 $ 149,394 Change in fair value of warrant liability (114,776 ) Balance as of June 30 2022 $ 34,618 Amount Balance as of April 1, 2021 $ 624,088 Change in fair value of warrant liability 128,800 Balance as of June 30 2021 $ 752,888 |
CONVERTIBLE NOTES
CONVERTIBLE NOTES | 6 Months Ended |
Jun. 30, 2022 | |
CONVERTIBLE NOTES [Abstract] | |
CONVERTIBLE NOTES | Note 11 CONVERTIBLE NOTES June 30, 2022 December 31, 2021 Principal outstanding $ 24,000,000 $ 24,000,000 Add: accrued interest 697,315 280,000 Less: unamortized debt issuance costs (16,886 ) (19,552 ) Convertible note payable, net of debt issuance costs $ 24,680,429 $ 24,260,448 On September 1, 2021, the Company entered into a Note Purchase Agreement with certain accredited investors and a director of the Company, pursuant to which the Company issued at 100% of par value $24,000,000 in aggregate principal balance of 3.5% Convertible Promissory Notes due September 1, 2025 (the “Notes”), convertible into (i) shares of Company common stock, and (ii) warrants to purchase shares of Company common stock equal to 20% of the principal amount of the Notes divided by the conversion price of the Notes (the “Warrants”). The Notes will mature on the fourth-year anniversary of the date of issuance, which time is also the termination date of the Warrants if issued. The conversion price of the Notes and the exercise price of the Warrants is $11.98 per share, which was the consolidated closing bid price of the Company common stock as reported by Nasdaq on August 31, 2021, the most recently completed trading day preceding the Company entering into the Note Purchase Agreement with investors with respect to the Notes. The holders of the Notes may, at any time, convert all or a portion of the Notes plus accrued interest (subject to a minimum principal amount of $100,000) at the conversion price. The Company may redeem all or a portion of any Notes then outstanding at any time after the first anniversary of issuance at a price of 112.5% of par value plus accrued interest. In the event of a change of control of the Company, the Company may redeem all Notes then outstanding at a price of 108% of par value plus accrued interest. Interest expense on the Notes is payable upon maturity or earlier redemption unless the Notes are converted prior to such time. In the event the holders of the Note convert all or a portion of the Notes, the related accrued interest is converted at the conversion price. Interest expense related to the Notes was $207,315 and $417,315 for the three and six months ended June 30, 2022, respectively, and $0 and $0 for the three and six months ended June 30, 2021, respectively. The Company evaluated the embedded features in accordance with ASC 815-15-25 and determined embedded features are all clearly and closely related to the debt host instrument and therefore are not required to be bifurcated and separately measured at fair value. The Warrants were not issued in connection with the Notes, and issuance of the Warrants is contingent upon conversion of the Notes at the option of the Holder, therefore no portion of the proceeds are allocated to the Warrants. The Company incurred debt issuance costs associated with the Notes in the amount of $21,330, which will be deferred and amortized over the term of the Notes. During the three and six months ended June 30, 2022, the Company recognized $1,333 and $2,666 in amortization of debt issuance costs, respectively, and during the three and six months ended June 30, 2021, the Company recognized $0 and $0 in amortization of debt issuance costs, respectively. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2022 | |
STOCK-BASED COMPENSATION [Abstract] | |
STOCK-BASED COMPENSATION | Note 12 STOCK-BASED COMPENSATION Restricted Stock Awards and Restricted Stock Units Unvested equity interests of MOR were converted into restricted Company common stock based upon the exchange ratio of 1.7776 shares of Company common stock for each 1 MOR unit, subject to any adjustments required under the Contribution Agreement. The information regarding the 2020 Plan below is presented as though the combination occurred as of the beginning of the periods presented. Number of Restricted Shares and Units Weighted Average Grant Date Fair Value Per Share Unvested at January 1, 2021 1,699,676 $ 1.28 Issued 454,000 11.71 Vested (907,545 ) 0.03 Canceled (100,000 ) 12.18 Unvested at December 31 2021 1,146,131 3.28 Issued — — Vested (261,775 ) 2.32 Canceled (11,541 ) 0.04 Unvested at June 30 2022 872,815 $ 4.34 The 872,815 of unvested awards at June 30, 2022 Stock Options As part of the Merger (see Note 4), the Company assumed the Helix TCS, Inc. Omnibus Stock Incentive Plan and the Bio-Tech Medical Software, Inc. 2014 Stock Incentive Plan, each as amended, pursuant to which options exercisable at prices between $2.00 and $51.80 per share for 455,089 shares of Company common stock were outstanding. The value attributable to service subsequent to the Merger will be recognized as compensation cost by the Company. The fair value of the stock options was estimated using the Black-Scholes option pricing model, and the assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgement. The assumptions at June 30, 2022 and December 31, 2021 are as follows: June 30, 2022 December 31, 2021 Exercise Price $ 2.00 to $51.80 $ 2.00 to $51.80 Fair value of Company common stock $ 2.98 - $15.61 $ 7.85 to $22.90 Dividend yield 0% 0% Expected volatility 117% to 188% 117% to 188% Risk Free interest rate 0.27% to 2.96% 0.27% to 1.59% Expected life (years) remaining 0.34 to 9.87 0.84 to 10.00 Stock option activity for the period ended June 30, 2022 Shares Underlying Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding at January 1, 2021 — $ — — Options assumed in Helix Merger 455,089 $ 15.13 3.24 Granted 3,893,714 $ 12.73 9.31 Exercised (29,937 ) $ 6.03 1.02 Forfeited and expired (271,893 ) $ 7.31 6.65 Outstanding at December 31 2021 4,046,973 $ 14.25 8.75 Granted 1,186,250 $ 4.02 9.83 Exercised (33,334 ) $ 2.47 3.05 Forfeited and expired (956,431 ) $ 15.16 8.46 Outstanding at June 30, 2022 4,243,458 $ 10.60 8.85 Vested options at June 30 2022 1,174,374 $ 11.16 7.56 The weighted average exercise price and remaining contractual life of exercisable options as of June 30, 2022 is $11.16 and 7.56 years, respectively. The total aggregate intrinsic value of the exercisable options as of June 30, 2022 was approximately $96,844. Stock Compensation Expense The grant date fair value per share for the stock options granted was $3.66 and $12.39 for the six months ended June 30, 2022 and 2021, respectively. On March 2, 2022, the Company and the former chief executive officer and the former chief financial officer of Helix mutually agreed not to renew special advisor agreements between the advisors and the Company. Per the terms of the agreements, options to purchase 366,166 shares of common stock will continue to vest according to their original terms through March 2, 2023, and unvested stock options to purchase 732,332 shares of common stock were forfeited. The advisors are not required to perform services to the Company beyond the non-renewal date of March 2, 2022. As a result, the Company recorded $5,417,043 of stock compensation expenses related to the options that will vest over the twelve months ending March 2, 2023 during March 2022. At June 30, 2022, the total unrecognized stock compensation expense related to unvested stock option awards and restricted stock awards and restricted stock units granted was $20,195,643, which the Company expects to recognize over a weighted-average period of approximately 3.17 years. Stock compensation expense for the three and six months ended June 30, 2022 and 2021 is as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Services $ 41,253 $ 4,656 $ 65,160 $ 4,656 Research and development 144,347 83,099 229,966 137,989 Sales and marketing 190,094 174,919 242,619 206,663 General and administrative 1,390,500 2,488,873 3,715,990 3,268,865 Separation expenses — — 5,417,043 — Total $ 1,766,194 $ 2,751,547 $ 9,670,778 $ 3,618,173 Total intrinsic value of options exercised in the period ended June 30, 2022 was $26,472. The total fair value of restricted shares vested during the period ended June 30, 2022 was $1,590,188. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2022 | |
STOCKHOLDERS' EQUITY [Abstract] | |
STOCKHOLDERS' EQUITY | Note 13 STOCKHOLDERS’ EQUITY The Condensed Consolidated Statement of Stockholders’ Equity reflects the exchange of MOR Members Equity for Company common stock as of the beginning of the periods presented. See Note 2. All of MOR’s Class A, Class B vested profit interests’ units, Series S, Series S-1, and vested Restricted Class B units were converted to Company common stock on March 2, 2021 based upon the exchange ratio of 1.7776 shares of Company common stock to 1 MOR member unit, subject to adjustment pursuant to the Contribution Agreement. Unvested Class B profit interest units, unvested restricted Class B units and options to acquire Restricted Class B Units were converted to unvested restricted Company common stock on March 2, 2021 based upon the exchange ratio of 1.7776 shares of Company common stock to 1 MOR member unit, subject to adjustment pursuant to the Contribution Agreement. The applicable vesting provisions of such MOR units carried over to the restricted Company common stock. In March 2021, the Company issued warrants to purchase 17,031 shares of Company common stock at a per-share purchase price equal to $0.01. The warrants terminate after a period of 2 years from the issuance date. The warrants were issued in exchange for services provided with a fair value of $389,976 included in transaction related expenses for the year ended December 31, 2021. On April 16, 2021, the Company raised proceeds of $11,968,652, net of transaction expenses of $31,348, resulting from the sale of 1,191,743 shares of Company common stock at an average purchase price equal to $10.21 per share to a select group of institutional and accredited investors. Investors included both unaffiliated investors as well as directors of the Company. Directors purchased 560,461 shares of common stock at a purchase price of $11.33 per share, which amount represented the consolidated closing bid price of Company common stock as reported by the Nasdaq on April 9, 2021, the last trading day prior to execution of the securities purchase agreement. Unaffiliated investors purchased 631,282 shares of Company common stock at a purchase price of $8.95 per share, which price was negotiated on April 9, 2021, and represents an approximately 15% discount to the preceding day’s volume weighted average price. See Note 4 for additional details on shares issued pursuant to the Merger. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2022 | |
NET LOSS PER SHARE [Abstract] | |
NET LOSS PER SHARE | Note 14 NET LOSS PER SHARE The following table sets forth the computation of the basic and diluted net loss per share: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Net loss attributable to common shareholders $ (5,433,545 ) $ (6,964,940 ) $ (17,287,633 ) $ (11,480,593 ) Net loss per share attributable to common shareholders: Basic $ (0.17 ) $ (0.22 ) $ (0.54 ) $ (0.42 ) Diluted $ (0.17 ) $ (0.22 ) $ (0.54 ) $ (0.42 ) Weighted average common shares outstanding: Basic 31,984,208 30,996,735 31,921,761 27,534,359 Diluted 31,984,208 30,996,735 31,921,761 27,534,359 The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive: As of June 30, 2022 2021 Potentially dilutive securities: Warrants 119,087 124,087 Stock options 4,243,458 3,703,329 Convertible notes 2,462,212 — Unvested Restricted Stock Awards and Units 872,815 1,760,551 Total 7,697,572 5,587,967 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2022 | |
RELATED PARTY TRANSACTIONS [Abstract] | |
RELATED PARTY TRANSACTIONS | Note 15 RELATED PARTY TRANSACTIONS Adam Dublin, Chief Strategy Officer, was previously a consultant for a current vendor of the Company. Mr. Dublin’s consultancy with the vendor ended on December 11, 2020 and the parties have agreed not to renew the consulting agreement. Pursuant to Mr. Dublin’s consulting agreement with the vendor, Mr. Dublin received payments from the vendor for the three and six months ended June 30, 2022 of $142,266 and $234,635, respectively, and for the three and six months ended June 30, 2021 of $90,065 and $196,149, respectively. On April 16, 2021, the Company raised net proceeds of $11,968,652 resulting from the sale of Company common stock to a select group of institutional and accredited investors, which included directors of the Company. See Note 13 for additional information. On September 1, 2021, the Company issued at 100% of par value $24,000,000 in aggregate principal balance of 3.5% Convertible Promissory Notes due 2025 convertible into (i) shares of Company common stock, and (ii) warrants to purchase shares of Company common stock equal to 20% of the principal amount of the Notes divided by the conversion price to a select group of institutional and accredited investors, which included a director of the Company who holds $6,000,000 of the Notes. See Note 11 for additional information. |
SEGMENT RESULTS
SEGMENT RESULTS | 6 Months Ended |
Jun. 30, 2022 | |
SEGMENT RESULTS [Abstract] | |
SEGMENT RESULTS | Note 16 SEGMENT RESULTS The Company provides innovative software solutions, proprietary data and predictive analytics to optimize the operational, clinical and financial performance of its customers within the healthcare and cannabis industries. FASB ASC Topic 280, “ Segment Reporting The Company has three operating and reportable segments, which are consistent with its reporting units as follows: The “Information and Software” segment licenses information and software products to customers. Revenues in this segment are currently derived from customers in the healthcare or cannabis industries; however, the Company’s information may be licensed to other customer segments as the Company leverages its analytics platform. The “Services” segment provides implementation, support and training on a contractual basis to customers. Revenues in this segment are primarily generated from the operation of cannabis-related “seed to sale” traceability platforms for government entities. The Company plans to introduce Real World Evidence (RWE) and Data as a Service (DaaS) service offerings in this segment in the future. The “Other” segment consists of certain other business operations, primarily in security and marketing services. The following represents selected information for the Company’s reportable segments: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Information and Software Revenue $ 6,084,439 $ 3,763,671 $ 11,893,533 $ 5,172,649 Costs and expenses 7,362,160 6,514,714 14,805,374 10,152,316 Loss from operations $ (1,277,721 ) $ (2,751,043 ) $ (2,911,841 ) $ (4,979,667 ) Total other income/(expense) — — — — Loss before income taxes $ (1,277,721 ) $ (2,751,043 ) $ (2,911,841 ) $ (4,979,667 ) Services Revenue $ 398,155 $ 492,336 $ 826,861 $ 588,647 Costs and expenses 307,755 305,830 599,354 386,120 Income from operations $ 90,400 $ 186,506 $ 227,507 $ 202,527 Total other income/(expense) — — — — Income before income taxes $ 90,400 $ 186,506 $ 227,507 $ 202,527 Other Revenue $ 51,664 $ 291,978 $ 205,143 $ 407,298 Costs and expenses 204,814 390,100 421,877 469,987 Income (loss) from operations $ (153,150 ) $ (98,122 ) $ (216,734 ) $ (62,689 ) Total other income/(expense) — 169,012 50 144,918 Income (loss) before income taxes $ (153,150 ) $ 70,890 $ (216,684 ) $ 82,229 Centrally Managed Costs Revenue $ — $ — $ — $ — Costs and expenses 4,252,080 4,322,291 14,605,764 7,261,636 Loss from operations $ (4,252,080 ) $ (4,322,291 ) $ (14,605,764 ) $ (7,261,636 ) Total other income/(expense) 164,006 (149,002 ) 229,149 475,954 Loss before income taxes $ (4,088,074 ) $ (4,471,293 ) $ (14,376,615 ) $ (6,785,682 ) Income tax expense (5,000 ) — (10,000 ) — Net loss $ (4,093,074 ) $ (4,471,293 ) $ (14,386,615 ) $ (6,785,682 ) Totals Revenue $ 6,534,258 $ 4,547,985 $ 12,925,537 $ 6,168,594 Costs and expenses 12,126,809 11,532,935 30,432,369 18,270,059 Loss from operations $ (5,592,551 ) $ (6,984,950 ) $ (17,506,832 ) $ (12,101,465 ) Total other income/(expense) 164,006 20,010 229,199 620,872 Loss before income taxes $ (5,428,545 ) $ (6,964,940 ) $ (17,277,633 ) $ (11,480,593 ) Income tax expense (5,000 ) — (10,000 ) — Net loss $ (5,433,545 ) $ (6,964,940 ) $ (17,287,633 ) $ (11,480,593 ) Approximately 98% of the Company’s revenues were attributable to customers in the United States for the three and six months ended June 30, 2022. Approximately 98% of revenues were attributable to customers in the United States for the three and six months ended June 30, 2021. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Note 17 COMMITMENTS AND CONTINGENCIES Operating Leases The Company accounts for leases in accordance with ASC Topic 842, Leases Leases are classified as finance or operating in accordance with the guidance in ASC 842. The Company does not hold any finance leases. The Company is obligated under operating lease agreements for office facilities in (i) Florida (two), (ii) Washington, (iii) Colorado and (iv) Argentina that expire in (i) December 2024, (ii) December 2022, (iii) February 2026 and (iv) July 2024, respectively. The Company also has two short-term leases related to offices in Pennsylvania and Massachusetts. These short-term leases are currently leased on a month-to-month basis. A short-term lease is a lease with a term of 12 months or less and does not include the option to purchase the underlying asset that we would expect to exercise. The Company has elected to adopt the short-term lease exemption in ASC 842 and as such have not recognized a “right of use” asset or lease liability for these short-term leases. The Company’s lease agreements generally do not provide an implicit borrowing rate, therefore an internal incremental borrowing rate is determined based on information available at lease commencement date for purposes of determining the present value of lease payments. Supplemental cash flow information and non-cash activity related to leases for the six months ended June 30, 2022 and 2021 were as follows: For the Six Months Ended June 30, 2022 2021 Cash used in operating leases $ 154,234 $ 120,615 ROU assets obtained in exchange for new operating lease liabilities $ — $ 1,082,684 ROU lease assets and lease liabilities for the Company’s operating leases were recorded in the condensed consolidated balance sheet as follows: June 30, 2022 December 31, 2021 Right of use assets, net $ 735,164 $ 859,637 Short-term operating lease liabilities $ 246,501 $ 247,325 Long-term operating lease liabilities 491,199 611,523 Total lease liabilities $ 737,700 $ 858,848 Weighted average remaining lease term (in years) 2.86 3.32 Weighted average discount rate 8.49 % 8.5% The components of lease expense were as follows for each of the periods presented: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Operating lease expense $ 78,781 $ 81,935 $ 157,562 $ 109,247 Short-term lease expense $ 58,522 $ 26,541 $ 118,409 $ 34,493 Total operating lease costs $ 137,303 $ 108,476 $ 275,971 $ 143,740 Future lease payments included in the measurement of lease liabilities on the condensed consolidated balance sheet as of June 30, 2022, for the following five fiscal years and thereafter were as follows: June 30, 2022 2022 $ 154,235 2023 286,670 2024 291,161 2025 85,726 2026 14,287 Total future minimum lease payments $ 832,079 Less imputed interest (94,379 ) Total $ 737,700 Service Agreements The Company entered into certain service agreements that provide for future minimum payments. The terms of these agreements vary in length. The following table shows the remaining payment obligations under these licenses as of June 30, 2022: June 30, 2022 Year ending December 31, 2022 $ 353,844 Year ending December 31, 2023 1,741,439 Year ending December 31, 2024 1,887,595 Year ending December 31, 2025 1,600,000 Year ending December 31, 2026 400,000 $ 5,982,878 Legal Proceedings From time to time the Company may be involved in claims that arise during the ordinary course of business. For any matters where management currently believes it is probable that the Company will incur a loss and that the probable loss or range of loss can be reasonably estimated, the Company records reserves in the condensed consolidated financial statements based on its best estimates of such loss. In other instances, because of the uncertainties related to either the probable outcome or the amount or range of loss, management is unable to make a reasonable estimate of a liability, if any. Regardless of the outcome, litigation can be costly and time consuming, and it can divert management’s attention from important business matters and initiatives, negatively impacting the Company’s overall operations. Although the results of litigation and claims cannot be predicted with certainty, the Company does not currently have any pending litigation to which it is a party or to which its property is subject that we believe to be material, except for the below. Audet v. Green Tree International, et. al. On February 14, 2020, John Audet filed a complaint in 15th Judicial Circuit in and for Palm Beach County, Florida against multiple parties, including Green Tree International (“GTI”), an indirect subsidiary of the Company, claiming that he owned 10% of GTI. The complaint seeks unspecified monetary damages equivalent to the value a 10% shareholder of GTI would have received in the subsequent Helix and Forian transactions, along with an equitable accounting and constructive trust to determine if Audet suffered any loss of profit distributions. The case is in the process of discovery and no trial schedule has been established. Each of the parties’ motions for summary judgment were recently denied. The Company believes the lawsuit is wholly without merit and will vigorously defend the claims in the lawsuit Nykiah Thomas v. Security Consultants Group, LLC d/b/a Helix TCS, Helix Technologies, Inc. and Shamson Sundra On July 16, 2021, Nykiah Thomas, individually and on behalf of M’Seiya Thomas, a minor, filed a complaint in the District Court, City and County of Denver, Colorado, against Security Consultants Group, LLC d/b/a Helix TCS and Helix Technologies, Inc., subsidiaries of Forian, and Shamson Sundra, a former employee of Security Consultants Group, LLC, alleging negligence in the performance of security services in connection with a school shooting at STEM School Highlands Ranch that occurred on May 7, 2019. In January 2022, the parties reached an agreement in principle to settle this dispute. In May 2022, the settlement agreement was approved by the Court and the parties entered into a Stipulation for Dismissal with Prejudice. The lawsuit was dismissed with prejudice by the Court in an order dated July 1, 2022. Grant Whitus et al. v. Forian Inc., Zachary Venegas and Scott Ogur On July 30, 2021, four former Helix employees filed a lawsuit in the Arapahoe County, Colorado District Court against the Company and Helix’s former managers asserting claims of breach of contract, promissory estoppel, breach of the covenant of good faith and fair dealing, civil theft and conversion, fraudulent misrepresentation, civil conspiracy, and unjust enrichment / quantum meruit, all relating to the plaintiffs’ claims that they were promised equity interest in Helix or compensation that they never received. The original complaint was never served, and in November 2021 the plaintiffs filed and served an amended complaint adding a fifth plaintiff, and seeking over $27.5 million in damages as well as attorneys’ fees and costs. The Company removed the matter to the United States District Court for the District of Colorado in December 2021 and both the Company and the individual defendants filed motions to dismiss on January 20, 2022. Plaintiffs subsequently amended their complaint on April 21, 2022, adding Helix TCS LLC and Helix Technologies, Inc. as defendants and advancing additional claims for breach of fiduciary duty and violation of the Colorado Wage Claims Act. The Company and the individual defendants filed their separate motions to dismiss on June 1, 2022, and briefing of those motions was completed on July 13, 2022. Although the motions are still pending, the Court ordered the parties to begin discovery. The Company intends to defend vigorously against the claims in the lawsuit. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2022 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | Note 18 SUBSEQUENT EVENTS The Company entered into a new lease agreement for office space in Hingham, Massachusetts, commencing on July 1, 2022. The lease has an initial term of two years, and base rent per year is approximately $22,000. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of (i) Medical Outcomes Research Analytics, LLC and its wholly owned subsidiaries COR Analytics, LLC and MOR Analytics, LLC, and (ii) Helix Technologies, Inc. and its wholly owned subsidiaries Helix TCS, LLC, Security Consultants Group, LLC, Security Grade Protective Services, Ltd., Bio-Tech Medical Software, Inc., Engeni LLC (including Engeni S.A. (“Engeni SA”), which is 99% owned by Engeni LLC), Green Tree International, Inc., Boss Security Solutions, Inc., BT UCS, Inc. and AIE Exchange Canada, Inc. Effective October 7, 2021, AIE Exchange Canada, Inc. was voluntarily dissolved. Effective December 31, 2021, (i) each of COR Analytics, LLC and MOR Analytics, LLC was merged with and into Medical Outcomes Research Analytics, LLC and (ii) each of BT UCS, Inc. and BOSS Security Solutions was merged with and into Security Grade Protective Services, Ltd., which entity was re-domesticated from Colorado to Delaware and renamed Helix Legacy, Inc. All intercompany transactions have been eliminated in consolidation. The financial results of Helix and its subsidiaries are included in the condensed consolidated financial statements beginning on March 2, 2021, the Merger Closing Date. |
Foreign Currency | Foreign Currency ASC Topic 830-10, Foreign Currency Matters |
Use of Estimates | Use of Estimates Preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgements and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses together with amounts disclosed in related notes to the financial statements. The significant areas of estimation include, but are not limited to, accounting for allowance for doubtful accounts, income taxes, depreciation, amortization of intangible assets, contingencies and stock-based compensation. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is possible that the external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates. |
Reclassifications | Reclassifications Certain reclassifications have been made to the prior period financial statements to conform to the current period financial statement presentation. Foreign currency related gains were reclassified from other comprehensive income to other income (expense) for Engeni SA, the Company’s Argentinian subsidiary, which operates in a highly inflationary country. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820, Fair Value Measurements and Disclosures (“ASC 820”) ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an ordinary transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 — quoted prices in active markets for identical assets or liabilities; Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable; and Level 3 — inputs that are unobservable. The carrying value of the Company’s financial instruments, such as cash, marketable securities, accounts receivable and accrued liabilities and other liabilities approximate fair values due to the short-term nature of these instruments. The estimated fair value of the Company’s warrant liability as of June 30, 2022 and December 31, 2021 was $34,618 and $369,234, respectively, based on Level 3 inputs. |
Cash and Cash Equivalents and Credit Risk | Cash and Cash Equivalents and Credit Risk The Company considers all cash accounts that are not subject to withdrawal restrictions and highly liquid investments with a maturity of three months or less, when purchased, as cash and cash equivalents. The Company maintains cash with major financial institutions. Cash held at U.S. bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. The portion of deposits in excess of FDIC coverage is not protected by such insurance and represents a credit risk to the Company. At times, the Company’s deposits exceed this coverage. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of an allowance for doubtful accounts. The Company determines the allowance for doubtful accounts based on historical write-off experience, customer specific facts and economic conditions. Outstanding account balances are reviewed individually for collectability. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. Allowance for doubtful accounts was $286,416 and $350,991 at June 30, 2022 and December 31, 2021, respectively. Management charges account balances against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. |
Long-Lived Assets, Including Definite Lived Intangible Assets | Long-Lived Assets, Including Definite Lived Intangible Assets Long-lived assets, other than goodwill and other indefinite-lived intangibles, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable through the estimated undiscounted future cash flows derived from such assets. Definite-lived intangible assets primarily consist of customer relationships, software technology and trade names. For long-lived assets used in operations, impairment losses are only recorded if the asset’s carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are written down to fair value. |
Goodwill | Goodwill Goodwill consists of the excess of cost over the fair value of net assets acquired in business combinations. Goodwill is not amortized. Instead, it is tested annually for impairment, or more frequently if events occur or circumstances change that would more likely than not reduce its fair value below its carrying amount. All goodwill is reported in the Information and Software reporting unit. Goodwill is evaluated for impairment annually or whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. The qualitative factors considered by Forian may include, but are not limited to, general economic conditions, the Company’s outlook, market performance of the Company’s industry and recent and forecasted financial performance. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that a reporting unit’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The Company has the option to first assess qualitative factors to determine whether events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount and to determine whether further action is needed. If, after assessing the totality of events or circumstances, the Company determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary. An impairment charge is recognized when the fair value of the Company’s goodwill is less than its carrying amount. No impairment losses have been recognized during the periods presented. |
Business Combinations | Business Combinations The Company accounts for its business combinations under the provisions of ASC Topic 805-10, which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including non-controlling interests, are recorded at the date of acquisition at their respective fair values. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized separately from the business combinations and are expensed as incurred. If the business combination provides for contingent consideration, the Company records the contingent consideration at fair value at the acquisition date and any changes in fair value after the acquisition date are accounted for as measurement-period adjustments. Changes in fair value of contingent consideration resulting from events after the acquisition date, such as earn-outs, are recognized as follows: (i) if the contingent consideration is classified as equity, the contingent consideration is not re-measured and its subsequent settlement is accounted for within equity; or (ii) if the contingent consideration is classified as a liability, the changes in fair value are recognized in earnings. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with Financial Accounting Standards Board (“FASB”) Topic 606, Revenue from Contracts with Customers Under ASC 606, the Company recognizes revenue when (or as) customers obtain control of promised goods or services, in an amount that reflects the consideration which is expected to be received in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed under ASC 606: (i) identify contract(s) with a customer; (ii) identify the performance obligation(s) in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligation(s) in the contract; and (v) recognize revenues when (or as) the Company satisfies a performance obligation. The Company applies the provisions of ASC 606 to an arrangement when a substantive contract exists and collectability is probable. The Company generates revenue from the following categories of offerings: Information and Software subscriptions, Services and Other products. The Company derives Information and Software revenue primarily from license fees for the Company’s Information products and subscription revenue for the Company’s Software products. Information products contracts are generally for a period of one month to five years. Information products’ customers may access data analytics products through the use of tools provided by the Company or by utilizing their own tools per the contract. Data products may consist of historical information as it exists at the time of delivery or information that will be updated over a period of time as agreed with the customer. In most cases, the provision of information products is considered a single performance obligation. In cases where the Company is not obligated to update information over the access period, and control over the use of the products passes to the customer when delivered, revenue is recognized when the information products are made available to the customer. In cases where information updates are provided over the contract term, they are considered highly interrelated with the information product delivered upon contract inception, and revenue is recognized ratably over the life of non-cancellable periods of the contract. Customers are generally invoiced according to monthly or annual amounts specified in the contract. Any amounts invoiced in excess of revenue recognized are recorded as deferred revenue. Revenue recognized in excess of amounts invoiced is recorded as a contract asset. Software revenue is primarily comprised of subscriptions to point of sale and business intelligence products and related hosting services. Subscription revenue is considered a single performance obligation recognized ratably over the term of the contract, beginning when access to the applicable software is provided to the customer. Customers are typically billed at the beginning of each month under agreements, which the customer may cancel with 30 days’ notice. When collection of fees occurs in advance of service delivery, revenue recognition is deferred until such services commence. Revenue for implementation fees is recognized as training and installation services are performed. Services revenues are primarily from fixed price contracts with government agencies where amounts are billed upon completion of the milestones within the contract. Revenue is recognized as the company satisfies its performance obligations under the contract. In the event that a contract does not specifically allocate revenue to the satisfaction of specific performance obligations or milestones, the transaction price is allocated based on the percentage of time spent, or expected to be spent, to meet each performance obligation. Initial customization of the software to meet state specific requirements and the training to appropriately utilize the software are generally recognized upon completion of the customization and acceptance by the state agency. Support and service revenues are then recognized over a predetermined period of time as defined in the contract. Contract renewals may include an annual service fee that is recognized over the time period defined in the contract. Other revenues are primarily from security monitoring services offerings and the provision of web marketing services. Contracts for these services have a stated transaction price for monthly services and are recognized as the services are provided. In some cases, contracts provide for variable consideration that is contingent upon the occurrence of uncertain future events, which can either increase or decrease the transaction price, including sales of products by customers derived from data analytics products the Company provides. Variable consideration based on sales of products by customers is recognized in the period of sales, subject to minimum amounts specified in contracts. Variable consideration is estimated at the expected value or at the most likely amount depending on the type of consideration. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimate of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of anticipated performance and all information (historical, current and forecasted) that is reasonably available to the Company and reevaluated each reporting period. The effect of revisions in recognized estimated variable consideration in excess of minimums are recorded beginning in the period in which the estimates are revised. Actual results could differ from periodic estimates. Significant judgments and estimates are sometimes necessary for the determination of whether performance obligations in a contract are distinct and whether they are delivered at a point in time or over time. Judgement is also necessary to assess revenue recognized under contingent revenue arrangements. Contract acquisition costs, which consist of sales commissions paid or payable, are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions for initial and renewal contracts are deferred and then amortized on a straight-line basis over the contract term. Contract assets and deferred revenues consist of the following as of June 30, 2022: Contract Assets Contract Liability Costs of obtaining contracts Unbilled revenue Total Deferred Revenue Balance at January 1, 2021 $ 53,784 $ 142,917 $ 196,701 $ 158,884 Acquired from Helix — 20,128 20,128 320,936 Acquired balances recognized during period — (20,128 ) (20,128 ) (263,787 ) Beginning deferred revenue balance recognized during the period — — — (158,884 ) Net change due to timing of billings, payments and recognition 16,494 843,696 860,190 919,119 Balance at December 31, 2021 70,278 986,613 1,056,891 976,268 Beginning deferred revenue balance recognized during the period — — — (773,629 ) Net change due to timing of billings, payments and recognition 115,488 573,792 689,280 2,782,241 Balance at June 30, 2022 $ 185,766 $ 1,560,405 $ 1,746,171 $ 2,984,880 Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. The majority of the Company’s noncurrent remaining performance obligations will be recognized over the next 36 months. The transaction price allocated to remaining performance obligations consisted of the following: June 30, 2022 December 31, 2021 Estimated next twelve months $ 12,827,702 $ 8,525,736 Thereafter 10,590,820 11,424,934 Total $ 23,418,522 $ 19,950,670 Remaining performance obligations include $2,984,880 and $976,268 of billed and deferred revenue at June 30, 2022 and December 31, 2021, respectively. The Company’s disaggregated revenue categories as of June 30, 2022 and 2021 are as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Healthcare Information $ 3,602,913 $ 1,382,511 $ 7,137,774 $ 1,956,347 Software Subscriptions 2,481,526 2,381,160 4,755,759 3,216,302 Services 398,155 492,336 826,861 588,647 Other 51,664 291,978 205,143 407,298 Total $ 6,534,258 $ 4,547,985 $ 12,925,537 $ 6,168,594 |
Segment Information | Segment Information ASC 280, Segment Reporting |
Customer Concentration | Customer Concentration The Company did not have any customers that exceeded 10% of total revenue for the three and six months ended June 30, 2022 or 2021. |
Concentration of Vendors | Concentration of Vendors The Company licenses certain information assets from third parties as a key input to certain Information and Software Products. While information licensing fees represented less than 10% of the Company’s operating expenses for the and months ended June and any disruption associated with these suppliers could have a material short-term impact on the business while alternate sources are secured. During the and months ended June the Company had vendors representing 22% and 15% and and 16% of purchases for outside development and cloud computing services, respectively. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation, which is recorded commencing at the in-service date using the straight-line method at rates sufficient to charge the cost of depreciable assets to operations over their estimated useful lives, which are 1 to 7 years. Maintenance and repairs are charged to operations as incurred. The Company reviews for the impairment of long-lived assets annually and whenever events and or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Such indicators include, among others, the nature of the asset, the projected future economic benefit of the asset, historical and future cash flows and profitability measurements. An impairment loss would be recognized when the value of the undiscounted estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than the carrying value. There were no impairment losses recognized during the and months ended June and |
Software Development Costs | Software Development Costs T he Company accounts for costs incurred in the development of computer software in accordance with ASC Subtopic - Intangibles – Goodwill and Other – Internal-Use Software and ASC Subtopic - Software –Costs of Software to be Sold, Leased or Marketed . Product development costs are primarily related to Company personnel and contractors for design and evaluating software development, testing, bug fixes, and other maintenance activities. Product development costs incurred in the application development stage for internal use software are subject to capitalization and subsequent amortization, and possible impairment. Product development costs not pertaining to the application development stage are expensed as incurred. The Company capitalized software development costs of and during the months ended June and respectively. |
Contingencies | Contingencies Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that it is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s condensed consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. |
Advertising | Advertising Advertising costs are expensed as incurred and included in sales and marketing expenses and amounted to and for the and months ended June respectively, and and for the and months ended June respectively. |
Net Loss per Share | Net Loss per Share Net loss per share of common stock is computed by dividing net loss by the weighted average number of common shares outstanding during the period. At June 30, 2022, the Company had potentially dilutive securities that could be exercised or converted into common stock. Refer to Note 14 for the Company’s disclosure on such potential dilution. Further, as the Company has incurred net losses for the three and six months ended June 30, 2022 and 2021, respectively, the diluted loss per share is the same as basic loss per share for the periods presented. |
Distinguishing Liabilities from Equity | Distinguishing Liabilities from Equity The Company relies on the guidance provided by ASC Topic 480, Distinguishing Liabilities from Equity Derivatives and Hedging: Contracts in Entity’s Own Equity Once the Company determines that a financial instrument should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability section and the equity section of the balance sheet (“temporary equity”). The Company will determine temporary equity classification if the redemption of the financial instrument is outside the control of the Company (i.e. at the option of the holder). Otherwise, the Company accounts for the financial instrument as permanent equity. Initial Measurement The Company records its financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received. Subsequent Measurement – Financial instruments classified as liabilities The Company records the fair value of its financial instruments classified as liabilities at each subsequent measurement date. The changes in fair value of its financial instruments classified as liabilities are recorded as other expense/income. |
Stock-based Compensation | Stock-based Compensation The Company’s 2020 Equity Incentive Plan (“2020 Plan”) permits the grant of stock options, restricted stock awards and/or restricted stock units. A total of 4,000,000 shares of Company common stock were originally authorized and reserved for issuance under the 2020 Plan. On June the Company’s stockholders approved an amendment to the Plan, which amended the Plan to increase the number of shares available for issuance by shares to a total of 6,400,000 shares. |
Income Taxes | Income Taxes MOR was organized as a limited liability company and became a wholly owned subsidiary of the Company upon completion of the Merger with Helix on March 2, 2021. As a result, the Company was treated as a partnership for federal and state income tax purposes through March 2, 2021. Accordingly, the Company’s taxable income, deductions, assets and liabilities are reported by the members on their respective income tax returns. Therefore, no provision for federal or state income tax has been made by the Company for all business activity from its inception through March 2, 2021. After March 2, 2021, the Company accounts for income taxes in accordance with FASB ASC 740 (“ASC 740”). Deferred income tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Tax contingencies are recorded, if needed, to address potential exposure involving tax positions the Company has taken that could be challenged by tax authorities. These potential exposures could result from applications of various statutes, rules, regulations and interpretations. Any estimates of tax contingencies contain assumptions and judgments about potential actions by taxing jurisdictions. Any interest and penalties related to uncertain tax positions would be included as part of the income tax provision. The Company’s conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analysis of or changes in tax laws, regulations and interpretations thereof as well as other factors. The Company recorded a provision for state taxes of and for the and months ended June respectively, and for the and months ended June |
Gain on Sale of Assets | Gain on Sale of Assets On March 3, 2022, the Company sold certain assets, consisting of customer contracts, accounts receivable, and other property related to its security monitoring services for $225,575 resulting in a gain of $202,159, which is included in operating expenses in the condensed consolidated statements of operations for the months ended June |
Separation Expenses | Separation Expenses During March 2022, the Company transferred certain development activities from its Engeni SA subsidiary to outsourced development facilities. As a result, the Company incurred $194,814 in severance and related costs to be recorded as a charge to operating expenses in during the months ended June On March 2, 2022, the Company and two advisors agreed not to renew special advisor agreements between the advisors and the Company. The advisors were the former chief executive officer and the former chief financial officer of Helix who were granted stock options in conjunction with their respective advisory agreements that were entered into upon the completion of the Helix acquisition. The Company and the advisors mutually agreed not to renew the advisory agreements. The services provided by these advisors included transition planning and consulting services related to integration of the business operations of Helix and Forian. Per the terms of the agreements, options to purchase 366,166 shares of common stock will continue to vest according to their original terms through March 2, 2023, and unvested stock options to purchase 732,332 shares of common stock were forfeited. The advisors are not required to perform services to the Company beyond the non-renewal date of March 2, 2022. As a result, the Company recorded $5,417,043 of stock compensation expenses related to the options that will vest over the twelve months ending March 2, 2023 during March 2022. |
Foreign Currency Related Gains | Foreign Currency Related Gains Foreign currency related gains result from foreign currency transactions and translation gains related to our Engeni SA subsidiary. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In October 2021, the FASB issued Accounting Standards Update No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Contract Balances | Contract assets and deferred revenues consist of the following as of June 30, 2022: Contract Assets Contract Liability Costs of obtaining contracts Unbilled revenue Total Deferred Revenue Balance at January 1, 2021 $ 53,784 $ 142,917 $ 196,701 $ 158,884 Acquired from Helix — 20,128 20,128 320,936 Acquired balances recognized during period — (20,128 ) (20,128 ) (263,787 ) Beginning deferred revenue balance recognized during the period — — — (158,884 ) Net change due to timing of billings, payments and recognition 16,494 843,696 860,190 919,119 Balance at December 31, 2021 70,278 986,613 1,056,891 976,268 Beginning deferred revenue balance recognized during the period — — — (773,629 ) Net change due to timing of billings, payments and recognition 115,488 573,792 689,280 2,782,241 Balance at June 30, 2022 $ 185,766 $ 1,560,405 $ 1,746,171 $ 2,984,880 |
Transaction Price Allocated to Remaining Performance Obligations | The transaction price allocated to remaining performance obligations consisted of the following: June 30, 2022 December 31, 2021 Estimated next twelve months $ 12,827,702 $ 8,525,736 Thereafter 10,590,820 11,424,934 Total $ 23,418,522 $ 19,950,670 |
Disaggregation of Revenue | The Company’s disaggregated revenue categories as of June 30, 2022 and 2021 are as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Healthcare Information $ 3,602,913 $ 1,382,511 $ 7,137,774 $ 1,956,347 Software Subscriptions 2,481,526 2,381,160 4,755,759 3,216,302 Services 398,155 492,336 826,861 588,647 Other 51,664 291,978 205,143 407,298 Total $ 6,534,258 $ 4,547,985 $ 12,925,537 $ 6,168,594 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
BUSINESS COMBINATION [Abstract] | |
Purchase Price Allocations | The following table summarizes the purchase price allocations relating to the Merger: Total purchase price $ 18,454,784 Assets acquired: Cash 1,310,977 Accounts receivable, net 488,453 Prepaid expenses 215,064 Contract assets 20,128 Other assets 450,000 Property and equipment 146,559 Software Technology 5,279,000 Trade Names and Trademarks 386,000 Customer Relationships 5,269,000 Right of use assets 1,082,684 Deposits and other assets 58,950 Total assets acquired $ 14,706,815 Liabilities assumed: Accounts payable $ 681,879 Accrued expenses 1,972,663 Short-term lease liabilities 295,364 Deferred revenues 320,936 Warrant liability 1,247,715 Notes payable and financing arrangements 20,801 Other long-term liabilities 812,045 Total liabilities assumed $ 5,351,403 Estimated fair value of net assets acquired: $ 9,355,412 Goodwill $ 9,099,372 |
Pro Forma Financial Information | T he following table represents the revenue, net loss and loss per share effect of the acquired company, as reported on a pro forma basis as if the acquisition occurred on January These pro forma results are not necessarily indicative of the results that would have occurred if the acquisition had occurred on the day of the periods presented, nor does the pro forma financial information purport to represent the results of operations for future periods. For the Months Ended June Description 2021 Revenues $ 8,177,506 Net loss $ (14,224,446 ) Net loss per share: Basic and diluted-as pro forma (unaudited) $ (0.47 ) |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
PROPERTY AND EQUIPMENT, NET [Abstract] | |
Property and Equipment | As of June 30, 2022 and December 31, 2021, property and equipment were comprised of the following: June 30, 2022 December 31, 2021 Personal computing equipment $ 195,089 $ 131,137 Furniture and equipment 127,802 119,381 Software development costs 2,985,827 1,338,044 Vehicles — 25,876 Total 3,308,718 1,614,438 Less: Accumulated depreciation and amortization (160,361 ) (82,479 ) Property and equipment, net $ 3,148,357 $ 1,531,959 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
INTANGIBLE ASSETS, NET [Abstract] | |
Intangible Assets | The following tables summarize the Company’s intangible assets as of June 30, 2022 and December 31, 2021: Estimated Useful Life (Years) Gross Carrying Amount at December 31, 2021 Accumulated Amortization Net Book Value at June 30, Customer Relationships 5 $ 5,269,000 $ (1,400,056 ) $ 3,868,944 Software Technology 2 1,170,000 (776,825 ) 393,175 Software Technology 7 4,109,000 (779,519 ) 3,329,481 Tradenames and Trademarks 8 386,000 (64,087 ) 321,913 $ 10,934,000 $ (3,020,487 ) $ 7,913,513 Estimated Useful Life (Years) Gross Carrying Amount at March 2, 2021 Accumulated Amortization Net Book Value at December 31, 2021 Customer Relationships 5 $ 5,269,000 $ (872,501 ) $ 4,396,499 Software Technology 2 1,170,000 (484,355 ) 685,645 Software Technology 7 4,109,000 (486,011 ) 3,622,989 Tradenames and Trademarks 8 386,000 (39,949 ) 346,051 $ 10,934,000 $ (1,882,816 ) $ 9,051,184 |
Estimated Future Amortization Expense | The estimated future amortization expense for the next five years and thereafter is as follows: Years Ending December 31, Future amortization expense 2022 (Remaining) $ 1,136,379 2023 1,789,695 2024 1,689,050 2025 1,689,050 2026 816,549 Thereafter 792,790 Total $ 7,913,513 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
ACCRUED EXPENSES [Abstract] | |
Accrued Expenses | As of June 30, 2022 and December 31, 2021, accrued expenses were comprised of the following: June 30, 2022 December 31, 2021 Accrued salary, commission and bonus $ 1,828,832 $ 2,046,584 Accrued expenses 1,868,354 2,021,525 Total $ 3,697,186 $ 4,068,109 |
WARRANT LIABILITY (Tables)
WARRANT LIABILITY (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
WARRANT LIABILITY [Abstract] | |
Fair Value of Warrant Liability Assumptions | The fair value of the Company’s warrant liability was calculated using the Black-Scholes model and the following assumptions: As of June 30, 2022 As of December 31, 2021 Fair value of company's common stock $ 4.39 $ 9.02 Dividend yield 0 % 0% Expected volatility 80% - 102 % 118% - 149% Risk Free interest rate 2.63% - 2.95 % 0.06% - 0.97% Expected life (years) 1.41 1.82 Exercise price $ 8.00 - $28.00 $ 8.00 - $28.00 Fair value of financial instruments - warrants $ 34,618 $ 369,234 |
Change in Fair Value of Financial Instruments | The change in fair value of the financial instruments – warrants is as follows: Amount Balance as of January 1, 2022 $ 369,234 Change in fair value of warrant liability (334,616 ) Balance as of June 30 2022 $ 34,618 Amount Balance as of January 1, 2021 $ — Fair value of warrant liability assumed in connection with Helix Merger 1,247,715 Change in fair value of warrant liability (494,827 ) Balance as of June 30 2021 $ 752,888 Amount Balance as of April 1, 2022 $ 149,394 Change in fair value of warrant liability (114,776 ) Balance as of June 30 2022 $ 34,618 Amount Balance as of April 1, 2021 $ 624,088 Change in fair value of warrant liability 128,800 Balance as of June 30 2021 $ 752,888 |
CONVERTIBLE NOTES (Tables)
CONVERTIBLE NOTES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
CONVERTIBLE NOTES [Abstract] | |
Convertible Note Payable | June 30, 2022 December 31, 2021 Principal outstanding $ 24,000,000 $ 24,000,000 Add: accrued interest 697,315 280,000 Less: unamortized debt issuance costs (16,886 ) (19,552 ) Convertible note payable, net of debt issuance costs $ 24,680,429 $ 24,260,448 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
STOCK-BASED COMPENSATION [Abstract] | |
Information Regarding Equity Incentive Plan | The information regarding the 2020 Plan below is presented as though the combination occurred as of the beginning of the periods presented. Number of Restricted Shares and Units Weighted Average Grant Date Fair Value Per Share Unvested at January 1, 2021 1,699,676 $ 1.28 Issued 454,000 11.71 Vested (907,545 ) 0.03 Canceled (100,000 ) 12.18 Unvested at December 31 2021 1,146,131 3.28 Issued — — Vested (261,775 ) 2.32 Canceled (11,541 ) 0.04 Unvested at June 30 2022 872,815 $ 4.34 |
Fair Value of Stock Option Assumptions | The assumptions at June 30, 2022 and December 31, 2021 are as follows: June 30, 2022 December 31, 2021 Exercise Price $ 2.00 to $51.80 $ 2.00 to $51.80 Fair value of Company common stock $ 2.98 - $15.61 $ 7.85 to $22.90 Dividend yield 0% 0% Expected volatility 117% to 188% 117% to 188% Risk Free interest rate 0.27% to 2.96% 0.27% to 1.59% Expected life (years) remaining 0.34 to 9.87 0.84 to 10.00 |
Stock Option Activity | Stock option activity for the period ended June 30, 2022 Shares Underlying Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding at January 1, 2021 — $ — — Options assumed in Helix Merger 455,089 $ 15.13 3.24 Granted 3,893,714 $ 12.73 9.31 Exercised (29,937 ) $ 6.03 1.02 Forfeited and expired (271,893 ) $ 7.31 6.65 Outstanding at December 31 2021 4,046,973 $ 14.25 8.75 Granted 1,186,250 $ 4.02 9.83 Exercised (33,334 ) $ 2.47 3.05 Forfeited and expired (956,431 ) $ 15.16 8.46 Outstanding at June 30, 2022 4,243,458 $ 10.60 8.85 Vested options at June 30 2022 1,174,374 $ 11.16 7.56 |
Stock Compensation Expense | Stock compensation expense for the three and six months ended June 30, 2022 and 2021 is as follows: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Services $ 41,253 $ 4,656 $ 65,160 $ 4,656 Research and development 144,347 83,099 229,966 137,989 Sales and marketing 190,094 174,919 242,619 206,663 General and administrative 1,390,500 2,488,873 3,715,990 3,268,865 Separation expenses — — 5,417,043 — Total $ 1,766,194 $ 2,751,547 $ 9,670,778 $ 3,618,173 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
NET LOSS PER SHARE [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of the basic and diluted net loss per share: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Net loss attributable to common shareholders $ (5,433,545 ) $ (6,964,940 ) $ (17,287,633 ) $ (11,480,593 ) Net loss per share attributable to common shareholders: Basic $ (0.17 ) $ (0.22 ) $ (0.54 ) $ (0.42 ) Diluted $ (0.17 ) $ (0.22 ) $ (0.54 ) $ (0.42 ) Weighted average common shares outstanding: Basic 31,984,208 30,996,735 31,921,761 27,534,359 Diluted 31,984,208 30,996,735 31,921,761 27,534,359 |
Antidilutive Securities Excluded from Computation of Loss Per Share | The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive: As of June 30, 2022 2021 Potentially dilutive securities: Warrants 119,087 124,087 Stock options 4,243,458 3,703,329 Convertible notes 2,462,212 — Unvested Restricted Stock Awards and Units 872,815 1,760,551 Total 7,697,572 5,587,967 |
SEGMENT RESULTS (Tables)
SEGMENT RESULTS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
SEGMENT RESULTS [Abstract] | |
Segment Reporting Information by Segment | The following represents selected information for the Company’s reportable segments: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Information and Software Revenue $ 6,084,439 $ 3,763,671 $ 11,893,533 $ 5,172,649 Costs and expenses 7,362,160 6,514,714 14,805,374 10,152,316 Loss from operations $ (1,277,721 ) $ (2,751,043 ) $ (2,911,841 ) $ (4,979,667 ) Total other income/(expense) — — — — Loss before income taxes $ (1,277,721 ) $ (2,751,043 ) $ (2,911,841 ) $ (4,979,667 ) Services Revenue $ 398,155 $ 492,336 $ 826,861 $ 588,647 Costs and expenses 307,755 305,830 599,354 386,120 Income from operations $ 90,400 $ 186,506 $ 227,507 $ 202,527 Total other income/(expense) — — — — Income before income taxes $ 90,400 $ 186,506 $ 227,507 $ 202,527 Other Revenue $ 51,664 $ 291,978 $ 205,143 $ 407,298 Costs and expenses 204,814 390,100 421,877 469,987 Income (loss) from operations $ (153,150 ) $ (98,122 ) $ (216,734 ) $ (62,689 ) Total other income/(expense) — 169,012 50 144,918 Income (loss) before income taxes $ (153,150 ) $ 70,890 $ (216,684 ) $ 82,229 Centrally Managed Costs Revenue $ — $ — $ — $ — Costs and expenses 4,252,080 4,322,291 14,605,764 7,261,636 Loss from operations $ (4,252,080 ) $ (4,322,291 ) $ (14,605,764 ) $ (7,261,636 ) Total other income/(expense) 164,006 (149,002 ) 229,149 475,954 Loss before income taxes $ (4,088,074 ) $ (4,471,293 ) $ (14,376,615 ) $ (6,785,682 ) Income tax expense (5,000 ) — (10,000 ) — Net loss $ (4,093,074 ) $ (4,471,293 ) $ (14,386,615 ) $ (6,785,682 ) Totals Revenue $ 6,534,258 $ 4,547,985 $ 12,925,537 $ 6,168,594 Costs and expenses 12,126,809 11,532,935 30,432,369 18,270,059 Loss from operations $ (5,592,551 ) $ (6,984,950 ) $ (17,506,832 ) $ (12,101,465 ) Total other income/(expense) 164,006 20,010 229,199 620,872 Loss before income taxes $ (5,428,545 ) $ (6,964,940 ) $ (17,277,633 ) $ (11,480,593 ) Income tax expense (5,000 ) — (10,000 ) — Net loss $ (5,433,545 ) $ (6,964,940 ) $ (17,287,633 ) $ (11,480,593 ) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Supplemental Cash Flow Information and Non-Cash Activity Related to Leases | Supplemental cash flow information and non-cash activity related to leases for the six months ended June 30, 2022 and 2021 were as follows: For the Six Months Ended June 30, 2022 2021 Cash used in operating leases $ 154,234 $ 120,615 ROU assets obtained in exchange for new operating lease liabilities $ — $ 1,082,684 |
ROU Lease Assets and Lease Liabilities | ROU lease assets and lease liabilities for the Company’s operating leases were recorded in the condensed consolidated balance sheet as follows: June 30, 2022 December 31, 2021 Right of use assets, net $ 735,164 $ 859,637 Short-term operating lease liabilities $ 246,501 $ 247,325 Long-term operating lease liabilities 491,199 611,523 Total lease liabilities $ 737,700 $ 858,848 Weighted average remaining lease term (in years) 2.86 3.32 Weighted average discount rate 8.49 % 8.5% |
Components of Lease Expenses | The components of lease expense were as follows for each of the periods presented: For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Operating lease expense $ 78,781 $ 81,935 $ 157,562 $ 109,247 Short-term lease expense $ 58,522 $ 26,541 $ 118,409 $ 34,493 Total operating lease costs $ 137,303 $ 108,476 $ 275,971 $ 143,740 |
Future Lease Payments Included in Measurement of Lease Liabilities | Future lease payments included in the measurement of lease liabilities on the condensed consolidated balance sheet as of June 30, 2022, for the following five fiscal years and thereafter were as follows: June 30, 2022 2022 $ 154,235 2023 286,670 2024 291,161 2025 85,726 2026 14,287 Total future minimum lease payments $ 832,079 Less imputed interest (94,379 ) Total $ 737,700 |
Remaining Payment Obligations under these Licenses | The following table shows the remaining payment obligations under these licenses as of June 30, 2022: June 30, 2022 Year ending December 31, 2022 $ 353,844 Year ending December 31, 2023 1,741,439 Year ending December 31, 2024 1,887,595 Year ending December 31, 2025 1,600,000 Year ending December 31, 2026 400,000 $ 5,982,878 |
BUSINESS ORGANIZATION AND NAT_2
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS (Details) | 6 Months Ended | |
Mar. 02, 2021 | Jun. 30, 2022 | |
Business Organization and Nature of Operations Description [Abstract] | ||
Exchange ratio | 1.7776 | |
Medical Outcomes Research Analytics, LLC [Member] | ||
Business Organization and Nature of Operations Description [Abstract] | ||
Exchange ratio | 1.7776 | |
Helix Technologies, Inc [Member] | ||
Business Organization and Nature of Operations Description [Abstract] | ||
Exchange ratio | 0.05 | 0.05 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Principles of Consolidation (Details) | Jun. 30, 2022 |
Engeni S.A. [Member] | |
Principles of Consolidation [Abstract] | |
Percentage of owned subsidiaries | 99% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Foreign Currency (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Foreign Currency [Abstract] | |||||
Revenue | $ 6,534,258 | $ 4,547,985 | $ 12,925,537 | $ 6,168,594 | |
Engeni S.A. [Member] | Revenue Benchmark [Member] | Geographic Concentration Risk [Member] | |||||
Foreign Currency [Abstract] | |||||
Percentage of consolidated net sales | 1% | 1% | 1% | 1% | 1% |
Revenue | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Fair Value of Financial Instruments (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Warrant Liability [Member] | Level 3 Inputs [Member] | ||
Debt Instrument, Fair Value Disclosure [Abstract] | ||
Estimated fair value of Convertible Note | $ 34,618 | $ 369,234 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Cash and Cash Equivalents and Credit Risk (Details) | Jun. 30, 2022 USD ($) |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Cash, FDIC insured amount | $ 250,000 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Accounts Receivable and Allowance for Doubtful Accounts [Abstract] | ||
Allowance for doubtful accounts | $ 286,416 | $ 350,991 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Goodwill (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Goodwill [Abstract] | ||
Impairment losses | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Revenue Recognition (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Revenue Recognition [Abstract] | |||||
Payment term after billed date | 30 days | ||||
Contract assets [Abstract] | |||||
Beginning balance | $ 1,056,891 | $ 196,701 | $ 196,701 | ||
Acquired from Helix | (20,128) | ||||
Beginning deferred revenue balance recognized during the period | 0 | 0 | |||
Net change due to timing of billings, payments and recognition | 689,280 | 860,190 | |||
Ending balance | $ 1,746,171 | 1,746,171 | 1,056,891 | ||
Revenues [Abstract] | |||||
Disaggregated revenue | 6,534,258 | $ 4,547,985 | 12,925,537 | 6,168,594 | |
Revenue, Performance Obligation [Abstract] | |||||
Remaining performance obligation | 23,418,522 | 23,418,522 | 19,950,670 | ||
Remaining performance obligation of billed and deferred revenue | 2,984,880 | 2,984,880 | 976,268 | ||
Healthcare Information [Member] | |||||
Revenues [Abstract] | |||||
Disaggregated revenue | 3,602,913 | 1,382,511 | 7,137,774 | 1,956,347 | |
Software Subscriptions [Member] | |||||
Revenues [Abstract] | |||||
Disaggregated revenue | 2,481,526 | 2,381,160 | 4,755,759 | 3,216,302 | |
Service [Member] | |||||
Revenues [Abstract] | |||||
Disaggregated revenue | 398,155 | 492,336 | 826,861 | 588,647 | |
Other [Member] | |||||
Revenues [Abstract] | |||||
Disaggregated revenue | $ 51,664 | $ 291,978 | $ 205,143 | 407,298 | |
Minimum [Member] | |||||
Revenue Recognition [Abstract] | |||||
Period of information products contracts | 1 month | ||||
Maximum [Member] | |||||
Revenue Recognition [Abstract] | |||||
Period of information products contracts | 5 years | ||||
Helix Technologies, Inc [Member] | |||||
Contract assets [Abstract] | |||||
Acquired from Helix | $ 20,128 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |||||
Revenue, Performance Obligation [Abstract] | |||||
Period of recognized noncurrent remaining performance obligations | 1 year | ||||
Remaining performance obligation | $ 8,525,736 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |||||
Revenue, Performance Obligation [Abstract] | |||||
Period of recognized noncurrent remaining performance obligations | 1 year | 1 year | |||
Remaining performance obligation | $ 12,827,702 | $ 12,827,702 | 11,424,934 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |||||
Revenue, Performance Obligation [Abstract] | |||||
Period of recognized noncurrent remaining performance obligations | |||||
Remaining performance obligation | $ 10,590,820 | $ 10,590,820 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |||||
Revenue, Performance Obligation [Abstract] | |||||
Period of recognized noncurrent remaining performance obligations | 36 months | 36 months | |||
Costs of Obtaining Contracts [Member] | |||||
Contract assets [Abstract] | |||||
Beginning balance | $ 70,278 | 53,784 | 53,784 | ||
Acquired from Helix | 0 | ||||
Beginning deferred revenue balance recognized during the period | 0 | 0 | |||
Net change due to timing of billings, payments and recognition | 115,488 | 16,494 | |||
Ending balance | $ 185,766 | 185,766 | 70,278 | ||
Costs of Obtaining Contracts [Member] | Helix Technologies, Inc [Member] | |||||
Contract assets [Abstract] | |||||
Acquired from Helix | 0 | ||||
Unbilled Revenue [Member] | |||||
Contract assets [Abstract] | |||||
Beginning balance | 986,613 | 142,917 | 142,917 | ||
Acquired from Helix | (20,128) | ||||
Beginning deferred revenue balance recognized during the period | 0 | 0 | |||
Net change due to timing of billings, payments and recognition | 573,792 | 843,696 | |||
Ending balance | 1,560,405 | 1,560,405 | 986,613 | ||
Unbilled Revenue [Member] | Helix Technologies, Inc [Member] | |||||
Contract assets [Abstract] | |||||
Acquired from Helix | 20,128 | ||||
Deferred Revenue [Member] | |||||
Contract liabilities (Deferred Revenue) [Abstract] | |||||
Beginning balance | 976,268 | $ 158,884 | 158,884 | ||
Acquired from Helix | (263,787) | ||||
Beginning deferred revenue balance recognized during the period | (773,629) | (158,884) | |||
Net change due to timing of billings, payments and recognition | 2,782,241 | 919,119 | |||
Ending balance | $ 2,984,880 | $ 2,984,880 | 976,268 | ||
Deferred Revenue [Member] | Helix Technologies, Inc [Member] | |||||
Contract liabilities (Deferred Revenue) [Abstract] | |||||
Acquired from Helix | $ 320,936 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Customer Concentration (Details) - Customer | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||||
Customer Concentration [Abstract] | ||||
Number of major customers | 0 | 0 | 0 | 0 |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Concentration of Vendors (Details) - Vendor | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Reliance on Key Vendors [Abstract] | ||||
Percentage of licensing fees | 10% | 10% | 10% | 10% |
Number of vendors | 2 | 2 | ||
Outside Development [Member] | ||||
Reliance on Key Vendors [Abstract] | ||||
Percentage of licensing fees | 22% | 15% | ||
Cloud Computing Services [Member] | ||||
Reliance on Key Vendors [Abstract] | ||||
Percentage of licensing fees | 21% | 16% |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Property and Equipment, Net (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Property and Equipment, Net [Abstract] | ||||
Impairment losses | $ 0 | $ 0 | $ 0 | $ 0 |
Minimum [Member] | ||||
Property and Equipment, Net [Abstract] | ||||
Estimated useful lives | 1 year | |||
Maximum [Member] | ||||
Property and Equipment, Net [Abstract] | ||||
Estimated useful lives | 7 years |
SUMMARY OF SIGNIFICANT ACCOU_14
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Software Development Costs (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Software Development Costs [Abstract] | ||
Capitalized software development costs | $ 1,624,991 | $ 266,410 |
SUMMARY OF SIGNIFICANT ACCOU_15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Advertising (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Advertising [Abstract] | ||||
Advertising costs | $ 49,314 | $ 16,063 | $ 81,496 | $ 20,998 |
SUMMARY OF SIGNIFICANT ACCOU_16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Stock-Based Compensation (Details) - shares | Jun. 15, 2022 | Jun. 14, 2022 |
Stock-based Compensation [Abstract] | ||
Number of shares authorized and reserved for issuance under 2020 Plan (in shares) | 6,400,000 | 4,000,000 |
Increase in number of shares authorized and reserved for issuance under 2020 Plan (in shares) | 2,400,000 |
SUMMARY OF SIGNIFICANT ACCOU_17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Income Taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 22 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Mar. 02, 2021 | |
Income Taxes [Abstract] | |||||
Provision for federal or state income tax | $ 0 | ||||
Provision for state taxes | $ 5,000 | $ 0 | $ 10,000 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOU_18
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Gain on Sale of Assets (Details) - USD ($) | 6 Months Ended | ||
Mar. 03, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | |
Gain on Sale of Assets [Abstract] | |||
Proceeds from sale of assets | $ 225,575 | $ 225,575 | $ 0 |
Gain on sale of assets | $ 202,159 |
SUMMARY OF SIGNIFICANT ACCOU_19
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Separation Expenses (Details) | 1 Months Ended | 6 Months Ended | ||
Mar. 02, 2022 USD ($) Advisor shares | Mar. 31, 2022 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | |
Separation Expenses [Abstract] | ||||
Severance and related costs | $ | $ 194,814 | |||
Number of advisors | Advisor | 2 | |||
Options to purchase shares of common stock (in shares) | shares | 366,166 | |||
Shares of common stock forfeited (in shares) | shares | 732,332 | |||
Stock compensation expenses | $ | $ 5,417,043 | $ 9,670,778 | $ 3,618,173 |
BUSINESS COMBINATION, Summary o
BUSINESS COMBINATION, Summary of Purchase Price Allocation (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Mar. 02, 2021 USD ($) $ / shares | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Business Combination [Abstract] | ||||||
Stock exchange ratio | 1.7776 | |||||
Liabilities assumed [Abstract] | ||||||
Goodwill | $ 9,099,372 | $ 9,099,372 | $ 9,099,372 | |||
Transaction costs incurred for business combination | $ 0 | $ 0 | $ 0 | $ 1,210,279 | ||
Trade Names and Trademarks [Member] | ||||||
Liabilities assumed [Abstract] | ||||||
Estimated useful life | 8 years | 8 years | ||||
Customer Relationships [Member] | ||||||
Liabilities assumed [Abstract] | ||||||
Estimated useful life | 5 years | 5 years | ||||
Helix Technologies, Inc [Member] | ||||||
Business Combination [Abstract] | ||||||
Percentage of voting interest acquired | 100% | |||||
Stock exchange ratio | 0.05 | 0.05 | ||||
Acquisition price (in dollars per share) | $ / shares | $ 2.158 | |||||
Purchase Price Allocations [Abstract] | ||||||
Total purchase price | $ 18,454,784 | |||||
Assets acquired [Abstract] | ||||||
Cash | 1,310,977 | |||||
Accounts receivable, net | 488,453 | |||||
Prepaid expenses | 215,064 | |||||
Contract assets | 20,128 | |||||
Other assets | 450,000 | |||||
Property and equipment | 146,559 | |||||
Right of use assets | 1,082,684 | |||||
Deposits and other assets | 58,950 | |||||
Total assets acquired | 14,706,815 | |||||
Liabilities assumed [Abstract] | ||||||
Accounts payable | 681,879 | |||||
Accrued expenses | 1,972,663 | |||||
Short-term lease liabilities | 295,364 | |||||
Deferred revenues | 320,936 | |||||
Warrant liability | 1,247,715 | |||||
Notes payable and financing arrangements | 20,801 | |||||
Other long-term liabilities | 812,045 | |||||
Total liabilities assumed | 5,351,403 | |||||
Estimated fair value of net assets acquired | 9,355,412 | |||||
Goodwill | 9,099,372 | |||||
Weighted average useful life | 5 years 5 months 19 days | |||||
Transaction costs incurred for business combination | $ 0 | $ 1,210,279 | ||||
Helix Technologies, Inc [Member] | Software Technology [Member] | ||||||
Assets acquired [Abstract] | ||||||
Intangibles | 5,279,000 | |||||
Helix Technologies, Inc [Member] | Software Technology [Member] | Minimum [Member] | ||||||
Liabilities assumed [Abstract] | ||||||
Estimated useful life | 2 years | |||||
Helix Technologies, Inc [Member] | Software Technology [Member] | Maximum [Member] | ||||||
Liabilities assumed [Abstract] | ||||||
Estimated useful life | 7 years | |||||
Helix Technologies, Inc [Member] | Trade Names and Trademarks [Member] | ||||||
Assets acquired [Abstract] | ||||||
Intangibles | 386,000 | |||||
Liabilities assumed [Abstract] | ||||||
Estimated useful life | 8 years | |||||
Helix Technologies, Inc [Member] | Customer Relationships [Member] | ||||||
Assets acquired [Abstract] | ||||||
Intangibles | $ 5,269,000 | |||||
Liabilities assumed [Abstract] | ||||||
Estimated useful life | 5 years |
BUSINESS COMBINATION, Unaudited
BUSINESS COMBINATION, Unaudited Pro Forma Financial Information (Details) - Helix Technologies, Inc [Member] | 6 Months Ended |
Jun. 30, 2021 USD ($) $ / shares | |
Pro Forma Financial Information [Abstract] | |
Revenues | $ | $ 8,177,506 |
Net loss | $ | $ (14,224,446) |
Net loss per share [Abstract] | |
Basic as pro forma (in dollars per share) | $ / shares | $ (0.47) |
Diluted as pro forma (in dollars per share) | $ / shares | $ (0.47) |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Prepaid Expense [Abstract] | ||
Other prepaid expenses | $ 1,258,238 | $ 1,017,927 |
Other Current Assets [Member] | ||
Prepaid Expense [Abstract] | ||
Receivable from employees | $ 384,313 | |
Minimum [Member] | ||
Prepaid Expense [Abstract] | ||
Prepaid expense related to software licenses and insurance policies period | 3 months | |
Maximum [Member] | ||
Prepaid Expense [Abstract] | ||
Prepaid expense related to software licenses and insurance policies period | 1 year |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Property, Plant and Equipment, Net, by Type [Abstract] | |||||
Property and equipment | $ 3,308,718 | $ 3,308,718 | $ 1,614,438 | ||
Less: Accumulated depreciation and amortization | (160,361) | (160,361) | (82,479) | ||
Property and equipment, net | 3,148,357 | 3,148,357 | 1,531,959 | ||
Depreciation [Abstract] | |||||
Depreciation and amortization expense | 35,286 | $ 28,275 | 72,125 | $ 38,986 | |
Personal Computing Equipment [Member] | |||||
Property, Plant and Equipment, Net, by Type [Abstract] | |||||
Property and equipment | 195,089 | 195,089 | 131,137 | ||
Furniture and Equipment [Member] | |||||
Property, Plant and Equipment, Net, by Type [Abstract] | |||||
Property and equipment | 127,802 | 127,802 | 119,381 | ||
Software Development Costs [Member] | |||||
Property, Plant and Equipment, Net, by Type [Abstract] | |||||
Property and equipment | 2,985,827 | 2,985,827 | 1,338,044 | ||
Depreciation [Abstract] | |||||
Depreciation and amortization expense | 10,467 | $ 2,680 | 43,726 | $ 2,680 | |
Vehicles [Member] | |||||
Property, Plant and Equipment, Net, by Type [Abstract] | |||||
Property and equipment | $ 0 | $ 0 | $ 25,876 |
INTANGIBLE ASSETS, NET, Summary
INTANGIBLE ASSETS, NET, Summary (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Intangible Assets [Abstract] | |||||
Gross carrying amount | $ 10,934,000 | $ 10,934,000 | $ 10,934,000 | ||
Accumulated amortization | (3,020,487) | (3,020,487) | (1,882,816) | ||
Net book value | 7,913,513 | 7,913,513 | $ 9,051,184 | ||
Amortization expense for intangible assets | 568,836 | $ 567,213 | $ 1,137,671 | $ 744,086 | |
Customer Relationships [Member] | |||||
Intangible Assets [Abstract] | |||||
Estimated useful life | 5 years | 5 years | |||
Gross carrying amount | 5,269,000 | $ 5,269,000 | $ 5,269,000 | ||
Accumulated amortization | (1,400,056) | (1,400,056) | (872,501) | ||
Net book value | 3,868,944 | $ 3,868,944 | $ 4,396,499 | ||
Software Technology [Member] | |||||
Intangible Assets [Abstract] | |||||
Estimated useful life | 2 years | 2 years | |||
Gross carrying amount | 1,170,000 | $ 1,170,000 | $ 1,170,000 | ||
Accumulated amortization | (776,825) | (776,825) | (484,355) | ||
Net book value | 393,175 | $ 393,175 | $ 685,645 | ||
Software Technology [Member] | |||||
Intangible Assets [Abstract] | |||||
Estimated useful life | 7 years | 7 years | |||
Gross carrying amount | 4,109,000 | $ 4,109,000 | $ 4,109,000 | ||
Accumulated amortization | (779,519) | (779,519) | (486,011) | ||
Net book value | 3,329,481 | $ 3,329,481 | $ 3,622,989 | ||
Tradenames and Trademarks [Member] | |||||
Intangible Assets [Abstract] | |||||
Estimated useful life | 8 years | 8 years | |||
Gross carrying amount | 386,000 | $ 386,000 | $ 386,000 | ||
Accumulated amortization | (64,087) | (64,087) | (39,949) | ||
Net book value | $ 321,913 | $ 321,913 | $ 346,051 |
INTANGIBLE ASSETS, NET, Estimat
INTANGIBLE ASSETS, NET, Estimated Future Amortization Expense (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Estimated Future Amortization Expense [Abstract] | ||
2022 (Remaining) | $ 1,136,379 | |
2023 | 1,789,695 | |
2024 | 1,689,050 | |
2025 | 1,689,050 | |
2026 | 816,549 | |
Thereafter | 792,790 | |
Net book value | $ 7,913,513 | $ 9,051,184 |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
ACCRUED EXPENSES [Abstract] | ||
Accrued salary, commission and bonus | $ 1,828,832 | $ 2,046,584 |
Accrued expenses | 1,868,354 | 2,021,525 |
Total | $ 3,697,186 | $ 4,068,109 |
WARRANT LIABILITY (Details)
WARRANT LIABILITY (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Mar. 31, 2022 | |
WARRANT LIABILITY [Abstract] | ||||||
Number of warrants outstanding (in shares) | 92,058 | 92,058 | ||||
Fair Value of Warrant Liability Assumptions [Abstract] | ||||||
Fair value of financial instruments - warrants | $ 34,618 | $ 752,888 | $ 34,618 | $ 752,888 | $ 369,234 | $ 149,394 |
Change in Fair Value of Financial Instruments [Abstract] | ||||||
Beginning Balance | 149,394 | 624,088 | 369,234 | 0 | 0 | |
Fair value of warrant liability assumed in connection with Helix Merger | 1,247,715 | |||||
Change in fair value of warrant liability | (114,776) | 128,800 | (334,616) | (494,827) | ||
Ending Balance | $ 34,618 | $ 752,888 | $ 34,618 | $ 752,888 | $ 369,234 | |
Warrant Liability [Member] | ||||||
Fair Value of Warrant Liability Assumptions [Abstract] | ||||||
Fair value of company's common stock (in dollars per share) | $ 4.39 | $ 4.39 | $ 9.02 | |||
Dividend yield | 0% | 0% | ||||
Expected volatility, minimum | 80% | 118% | ||||
Expected volatility, maximum | 102% | 149% | ||||
Risk Free interest rate, minimum | 2.63% | 0.06% | ||||
Risk Free interest rate, maximum | 2.95% | 0.97% | ||||
Expected life (years) | 1 year 4 months 28 days | 1 year 9 months 25 days | ||||
Fair value of financial instruments - warrants | $ 34,618 | $ 34,618 | $ 369,234 | |||
Change in Fair Value of Financial Instruments [Abstract] | ||||||
Beginning Balance | 369,234 | |||||
Ending Balance | $ 34,618 | $ 34,618 | $ 369,234 | |||
Warrant Liability [Member] | Minimum [Member] | ||||||
Fair Value of Warrant Liability Assumptions [Abstract] | ||||||
Exercise price (in dollars per share) | $ 8 | $ 8 | $ 8 | |||
Warrant Liability [Member] | Maximum [Member] | ||||||
Fair Value of Warrant Liability Assumptions [Abstract] | ||||||
Exercise price (in dollars per share) | $ 28 | $ 28 | $ 28 |
CONVERTIBLE NOTES (Details)
CONVERTIBLE NOTES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Sep. 01, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Mar. 31, 2021 | |
Convertible Notes [Abstract] | |||||||
Convertible note payable, net of debt issuance costs | $ 24,680,429 | $ 24,680,429 | $ 24,260,448 | ||||
Exercise price of warrants (in dollars per share) | $ 0.01 | ||||||
Interest expense on convertible notes | 417,315 | $ 0 | |||||
Amortization of debt issuance costs | 2,666 | 0 | |||||
Convertible Notes [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Principal outstanding | $ 24,000,000 | 24,000,000 | 24,000,000 | 24,000,000 | |||
Add: accrued interest | 697,315 | 697,315 | 280,000 | ||||
Less: unamortized debt issuance costs | (16,886) | (16,886) | (19,552) | ||||
Convertible note payable, net of debt issuance costs | 24,680,429 | 24,680,429 | $ 24,260,448 | ||||
Percentage of issuance cost on principal amount | 100% | ||||||
Interest percentage on convertible promissory note | 3.50% | ||||||
Percentage of warrant to purchase common stock on principal amount | 20% | ||||||
Exercise price of warrants (in dollars per share) | $ 11.98 | ||||||
Minimum principal amount | $ 100,000 | ||||||
Interest expense on convertible notes | 207,315 | $ 0 | 417,315 | 0 | |||
Debt issuance costs | 21,330 | 21,330 | |||||
Amortization of debt issuance costs | $ 1,333 | $ 0 | $ 2,666 | $ 0 | |||
Convertible Notes [Member] | Period One [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Percentage of redemption price | 112.50% | ||||||
Convertible Notes [Member] | Period Two [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Percentage of redemption price | 108% |
STOCK-BASED COMPENSATION, Restr
STOCK-BASED COMPENSATION, Restricted Stock Awards and Restricted Stock Units (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | |
STOCK-BASED COMPENSATION [Abstract] | ||
Exchange ratio | 1.7776 | |
Restricted Stock Awards and Restricted Stock Units [Member] | ||
Number of Restricted Shares and Units [Roll Forward] | ||
Outstanding at beginning of period (in shares) | 1,146,131 | 1,699,676 |
Issued (in shares) | 0 | 454,000 |
Vested (in shares) | (261,775) | (907,545) |
Canceled (in shares) | (11,541) | (100,000) |
Outstanding at end of period (in shares) | 872,815 | 1,146,131 |
Weighted Average Grant Date Fair Value Per Share [Abstract] | ||
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 3.28 | $ 1.28 |
Issued (in dollars per share) | $ / shares | 0 | 11.71 |
Vested (in dollars per share) | $ / shares | 2.32 | 0.03 |
Cancelled (in dollars per share) | $ / shares | 0.04 | 12.18 |
Outstanding at end of period (in dollars per share) | $ / shares | $ 4.34 | $ 3.28 |
Restricted Stock Units [Member] | ||
Number of Restricted Shares and Units [Roll Forward] | ||
Outstanding at end of period (in shares) | 273,000 | |
Restricted Stock Awards [Member] | ||
Number of Restricted Shares and Units [Roll Forward] | ||
Outstanding at end of period (in shares) | 599,815 |
STOCK-BASED COMPENSATION, Stock
STOCK-BASED COMPENSATION, Stock Options (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Mar. 02, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Shares Underlying Options [Roll Forward] | |||
Options granted (in shares) | 366,166 | ||
Stock Options [Member] | |||
Fair Value of Stock Option Assumptions [Abstract] | |||
Dividend yield | 0% | 0% | |
Expected volatility | 117% | 117% | |
Expected volatility, maximum | 188% | 188% | |
Risk Free interest rate, minimum | 0.27% | 0.27% | |
Risk Free interest rate, maximum | 2.96% | 1.59% | |
Shares Underlying Options [Roll Forward] | |||
Outstanding at beginning of period (in shares) | 4,046,973 | 0 | |
Options assumed in Helix Merger (in shares) | 455,089 | ||
Options granted (in shares) | 1,186,250 | 3,893,714 | |
Options exercised (in shares) | (33,334) | (29,937) | |
Options forfeited and expired (in shares) | (956,431) | (271,893) | |
Outstanding at end of period (in shares) | 4,243,458 | 4,046,973 | |
Vested options outstanding (in shares) | 1,174,374 | ||
Weighted Average Exercise Price [Abstract] | |||
Weighted average exercise price, options outstanding (in dollars per share) | $ 14.25 | $ 0 | |
Weighted average exercise price, options assumed in Helix Merger (in dollars per share) | 15.13 | ||
Weighted average exercise price, options granted (in dollars per share) | 4.02 | 12.73 | |
Weighted average exercise price, options exercises (in dollars per share) | 2.47 | 6.03 | |
Weighted average exercise price, options forfeited and expired (in dollars per share) | 15.16 | 7.31 | |
Weighted average exercise price, options outstanding (in dollars per share) | 10.60 | $ 14.25 | |
Weighted average exercise price, Vested options outstanding (in dollars per share) | $ 11.16 | ||
Weighted Average Remaining Contractual Term (in years) [Abstract] | |||
Weighted average remaining contractual term, options outstanding | 8 years 10 months 6 days | 8 years 9 months | |
Weighted average remaining contractual term, options assumed in Helix Merger | 3 years 2 months 26 days | ||
Weighted average remaining contractual term, options granted | 9 years 9 months 29 days | 9 years 3 months 21 days | |
Weighted average remaining contractual term, options exercised | 3 years 18 days | 1 year 7 days | |
Weighted average remaining contractual term, options forfeited and expired | 8 years 5 months 15 days | 6 years 7 months 24 days | |
Weighted average remaining contractual term, vested options outstanding | 7 years 6 months 21 days | ||
Aggregate intrinsic value of exercisable options | $ 96,844 | ||
Stock Options [Member] | Minimum [Member] | |||
Fair Value of Stock Option Assumptions [Abstract] | |||
Exercise price (in dollars per share) | $ 2 | $ 2 | |
Fair value of company common stock (in dollars per share) | $ 2.98 | $ 7.85 | |
Expected life (years) remaining | 4 months 2 days | 10 months 2 days | |
Stock Options [Member] | Maximum [Member] | |||
Fair Value of Stock Option Assumptions [Abstract] | |||
Exercise price (in dollars per share) | $ 51.80 | $ 51.80 | |
Fair value of company common stock (in dollars per share) | $ 15.61 | $ 22.90 | |
Expected life (years) remaining | 9 years 10 months 13 days | 10 years |
STOCK-BASED COMPENSATION, Sto_2
STOCK-BASED COMPENSATION, Stock Compensation Expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Mar. 02, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Stock Compensation Expense [Abstract] | |||||
Stock options granted date fair value (in dollars per share) | $ 3.66 | $ 12.39 | |||
Options to purchase shares of common stock (in shares) | 366,166 | ||||
Shares of common stock forfeited (in shares) | 732,332 | ||||
Stock compensation expenses | $ 5,417,043 | $ 9,670,778 | $ 3,618,173 | ||
Total unrecognized compensation | $ 20,195,643 | $ 20,195,643 | |||
Weighted-average period | 3 years 2 months 1 day | ||||
Stock compensation expense | 1,766,194 | $ 2,751,547 | $ 9,670,778 | 3,618,173 | |
Intrinsic value of options exercised | 26,472 | ||||
Fair value of restricted shares vested | 1,590,188 | ||||
Services [Member] | |||||
Stock Compensation Expense [Abstract] | |||||
Stock compensation expense | 41,253 | 4,656 | 65,160 | 4,656 | |
Research and Development [Member] | |||||
Stock Compensation Expense [Abstract] | |||||
Stock compensation expense | 144,347 | 83,099 | 229,966 | 137,989 | |
Sales and Marketing [Member] | |||||
Stock Compensation Expense [Abstract] | |||||
Stock compensation expense | 190,094 | 174,919 | 242,619 | 206,663 | |
General and Administrative [Member] | |||||
Stock Compensation Expense [Abstract] | |||||
Stock compensation expense | 1,390,500 | 2,488,873 | 3,715,990 | 3,268,865 | |
Separation Expenses [Member] | |||||
Stock Compensation Expense [Abstract] | |||||
Stock compensation expense | $ 0 | $ 0 | $ 5,417,043 | $ 0 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) | 6 Months Ended | 12 Months Ended | ||||
Apr. 16, 2021 USD ($) $ / shares shares | Apr. 09, 2021 $ / shares shares | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Mar. 31, 2021 $ / shares shares | |
Stockholders' Equity [Abstract] | ||||||
Exchange ratio | 1.7776 | |||||
Warrant to purchase shares of common stock (in shares) | shares | 17,031 | |||||
Warrant to purchase shares of common stock price per share (in dollars per share) | $ / shares | $ 0.01 | |||||
Warrants termination period (in years) | 2 years | |||||
Warrants issued in exchange for services | $ | $ 0 | $ 389,976 | $ 389,976 | |||
Gross proceeds from sale of common stock | $ | $ 11,968,652 | $ 0 | $ 11,968,652 | |||
Net of transaction expenses | $ | $ 31,348 | |||||
Sale of common stock (in shares) | shares | 1,191,743 | |||||
Purchase price (in dollars per share) | $ / shares | $ 10.21 | |||||
Directors [Member] | ||||||
Stockholders' Equity [Abstract] | ||||||
Sale of common stock (in shares) | shares | 560,461 | |||||
Purchase price (in dollars per share) | $ / shares | $ 11.33 | |||||
Unaffiliated Investors [Member] | ||||||
Stockholders' Equity [Abstract] | ||||||
Sale of common stock (in shares) | shares | 631,282 | |||||
Purchase price (in dollars per share) | $ / shares | $ 8.95 | |||||
Discount rate to preceding day's volume weighted average price | 15% |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
NET LOSS PER SHARE [Abstract] | ||||
Net loss attributable to common shareholders | $ (5,433,545) | $ (6,964,940) | $ (17,287,633) | $ (11,480,593) |
Earnings Per Share, Basic [Abstract] | ||||
Basic (in dollars per share) | $ (0.17) | $ (0.22) | $ (0.54) | $ (0.42) |
Earnings Per Share, Diluted [Abstract] | ||||
Diluted (in dollars per share) | $ (0.17) | $ (0.22) | $ (0.54) | $ (0.42) |
Weighted Average Common Shares Outstanding [Abstract] | ||||
Basic (in shares) | 31,984,208 | 30,996,735 | 31,921,761 | 27,534,359 |
Diluted (in shares) | 31,984,208 | 30,996,735 | 31,921,761 | 27,534,359 |
Potentially Dilutive Securities [Abstract] | ||||
Antidilutive securities excluded from computation of loss per share (in shares) | 7,697,572 | 5,587,967 | ||
Warrants [Member] | ||||
Potentially Dilutive Securities [Abstract] | ||||
Antidilutive securities excluded from computation of loss per share (in shares) | 119,087 | 124,087 | ||
Stock Options [Member] | ||||
Potentially Dilutive Securities [Abstract] | ||||
Antidilutive securities excluded from computation of loss per share (in shares) | 4,243,458 | 3,703,329 | ||
Convertible Notes [Member] | ||||
Potentially Dilutive Securities [Abstract] | ||||
Antidilutive securities excluded from computation of loss per share (in shares) | 2,462,212 | 0 | ||
Unvested Restricted Stock Awards and Units [Member] | ||||
Potentially Dilutive Securities [Abstract] | ||||
Antidilutive securities excluded from computation of loss per share (in shares) | 872,815 | 1,760,551 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Apr. 16, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Sep. 01, 2021 | |
Related Party Transactions [Abstract] | |||||||
Net proceeds from sale of common stock | $ 11,968,652 | $ 0 | $ 11,968,652 | ||||
Notes held by directors | $ 6,000,000 | 6,000,000 | $ 6,000,000 | ||||
Convertible Promissory Notes [Member] | |||||||
Related Party Transactions [Abstract] | |||||||
Percentage of issuance cost on principal amount | 100% | ||||||
Principal outstanding | 24,000,000 | 24,000,000 | $ 24,000,000 | $ 24,000,000 | |||
Interest percentage on convertible promissory note | 3.50% | ||||||
Percentage of warrant to purchase common stock on principal amount | 20% | ||||||
Notes held by directors | $ 6,000,000 | ||||||
Medical Outcomes Research Analytics, LLC [Member] | Adam Dublin [Member] | |||||||
Related Party Transactions [Abstract] | |||||||
Received payments | $ 142,266 | $ 90,065 | $ 234,635 | $ 196,149 |
SEGMENT RESULTS (Details)
SEGMENT RESULTS (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) Segment | Jun. 30, 2021 USD ($) | |
SEGMENT RESULTS [Abstract] | ||||
Number of operating segments | Segment | 3 | |||
Number of reportable segments | Segment | 3 | |||
Selected Information for Reportable Segments [Abstract] | ||||
Revenue | $ 6,534,258 | $ 4,547,985 | $ 12,925,537 | $ 6,168,594 |
Costs and expenses | 12,126,809 | 11,532,935 | 30,432,369 | 18,270,059 |
Loss From Operations | (5,592,551) | (6,984,950) | (17,506,832) | (12,101,465) |
Total other income/(expense) | 164,006 | 20,010 | 229,199 | 620,872 |
Net loss before income taxes | (5,428,545) | (6,964,940) | (17,277,633) | (11,480,593) |
Income tax expense | (5,000) | 0 | (10,000) | 0 |
Net Loss | (5,433,545) | (6,964,940) | (17,287,633) | (11,480,593) |
Reportable Segments [Member] | Information and Software [Member] | ||||
Selected Information for Reportable Segments [Abstract] | ||||
Revenue | 6,084,439 | 3,763,671 | 11,893,533 | 5,172,649 |
Costs and expenses | 7,362,160 | 6,514,714 | 14,805,374 | 10,152,316 |
Loss From Operations | (1,277,721) | (2,751,043) | (2,911,841) | (4,979,667) |
Total other income/(expense) | 0 | 0 | 0 | 0 |
Net loss before income taxes | (1,277,721) | (2,751,043) | (2,911,841) | (4,979,667) |
Reportable Segments [Member] | Services [Member] | ||||
Selected Information for Reportable Segments [Abstract] | ||||
Revenue | 398,155 | 492,336 | 826,861 | 588,647 |
Costs and expenses | 307,755 | 305,830 | 599,354 | 386,120 |
Loss From Operations | 90,400 | 186,506 | 227,507 | 202,527 |
Total other income/(expense) | 0 | 0 | 0 | 0 |
Net loss before income taxes | 90,400 | 186,506 | 227,507 | 202,527 |
Reportable Segments [Member] | Other [Member] | ||||
Selected Information for Reportable Segments [Abstract] | ||||
Revenue | 51,664 | 291,978 | 205,143 | 407,298 |
Costs and expenses | 204,814 | 390,100 | 421,877 | 469,987 |
Loss From Operations | (153,150) | (98,122) | (216,734) | (62,689) |
Total other income/(expense) | 0 | 169,012 | 50 | 144,918 |
Net loss before income taxes | (153,150) | 70,890 | (216,684) | 82,229 |
Centrally Managed Costs [Member] | ||||
Selected Information for Reportable Segments [Abstract] | ||||
Revenue | 0 | 0 | 0 | 0 |
Costs and expenses | 4,252,080 | 4,322,291 | 14,605,764 | 7,261,636 |
Loss From Operations | (4,252,080) | (4,322,291) | (14,605,764) | (7,261,636) |
Total other income/(expense) | 164,006 | (149,002) | 229,149 | 475,954 |
Net loss before income taxes | (4,088,074) | (4,471,293) | (14,376,615) | (6,785,682) |
Income tax expense | (5,000) | 0 | (10,000) | 0 |
Net Loss | $ (4,093,074) | $ (4,471,293) | $ (14,386,615) | $ (6,785,682) |
Revenue [Member] | Geographic Concentration Risk [Member] | United States [Member] | ||||
Customer Concentration [Abstract] | ||||
Percentage of revenues generated from customer sales | 98% | 98% | 98% | 98% |
COMMITMENTS AND CONTINGENCIES,
COMMITMENTS AND CONTINGENCIES, Operating Leases (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) Lease Facility | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Operating Leases [Abstract] | |||||
Number of office facilities | Facility | 2 | ||||
Number of short-term leases | Lease | 2 | ||||
ROU lease assets and lease liabilities [Abstract] | |||||
Cash used in operating leases | $ 154,234 | $ 120,615 | |||
ROU assets obtained in exchange for new operating lease liabilities | 0 | 1,082,684 | |||
Lease liabilities | $ 737,700 | $ 737,700 | $ 858,848 | ||
Weighted average remaining lease term (in years) | 2 years 10 months 9 days | 2 years 10 months 9 days | 3 years 3 months 25 days | ||
Weighted average discount rate | 8.49% | 8.49% | 8.50% | ||
Lease, Cost [Abstract] | |||||
Operating lease expense | $ 78,781 | $ 81,935 | $ 157,562 | 109,247 | |
Short-term lease expense | 58,522 | 26,541 | 118,409 | 34,493 | |
Total operating lease costs | 137,303 | $ 108,476 | 275,971 | $ 143,740 | |
Future Lease Payments [Abstract] | |||||
2022 (Remaining) | 154,235 | 154,235 | |||
2023 | 286,670 | 286,670 | |||
2024 | 291,161 | 291,161 | |||
2025 | 85,726 | 85,726 | |||
2026 | 14,287 | 14,287 | |||
Total future minimum lease payments | 832,079 | 832,079 | |||
Less imputed interest | (94,379) | (94,379) | |||
Total | 737,700 | 737,700 | $ 858,848 | ||
Right of Use Assets, Net [Member] | |||||
ROU lease assets and lease liabilities [Abstract] | |||||
Lease liabilities | 735,164 | 735,164 | 859,637 | ||
Future Lease Payments [Abstract] | |||||
Total | 735,164 | 735,164 | 859,637 | ||
Short-Term Operating Lease Liabilities [Member] | |||||
ROU lease assets and lease liabilities [Abstract] | |||||
Lease liabilities | 246,501 | 246,501 | 247,325 | ||
Future Lease Payments [Abstract] | |||||
Total | 246,501 | 246,501 | 247,325 | ||
Long-Term Operating Lease Liabilities [Member] | |||||
ROU lease assets and lease liabilities [Abstract] | |||||
Lease liabilities | 491,199 | 491,199 | 611,523 | ||
Future Lease Payments [Abstract] | |||||
Total | $ 491,199 | $ 491,199 | $ 611,523 | ||
Minimum [Member] | |||||
Operating Leases [Abstract] | |||||
Operating lease term | 1 year | 1 year | |||
Maximum [Member] | |||||
Operating Leases [Abstract] | |||||
Operating lease term | 5 years | 5 years |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES, Service Agreements and Legal Proceedings (Details) | Jul. 30, 2021 USD ($) Employee | Jun. 30, 2022 USD ($) | Feb. 14, 2020 |
Remaining payment obligations [Abstract] | |||
Year ending December 31, 2022 | $ 353,844 | ||
Year ending December 31, 2023 | 1,741,439 | ||
Year ending December 31, 2024 | 1,887,595 | ||
Year ending December 31, 2025 | 1,600,000 | ||
Year ending December 31, 2026 | 400,000 | ||
Total payment obligations | $ 5,982,878 | ||
Audet v. Green Tree International, et. al. [Member] | John Audet [Member] | |||
Loss Contingency [Abstract] | |||
Ownership percentage | 10% | ||
Grant Whitus et al. v. Forian Inc., Zachary Venegas and Scott Ogur [Member] | |||
Loss Contingency [Abstract] | |||
Number of former employees to file lawsuit | Employee | 4 | ||
Loss contingency, damages, attorneys' fees and costs | $ 27,500,000 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Events [Member] | Jul. 01, 2022 USD ($) |
Subsequent Event [Abstract] | |
Initial lease term | 2 years |
Lease rent expenses | $ 22,000 |