Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 15, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 001-04321 | ||
Entity Registrant Name | CASTELLUM, INC. | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Tax Identification Number | 27-4079982 | ||
Entity Address, Address Line One | 3 Bethesda Metro Center | ||
Entity Address, Address Line Two | Suite 700 | ||
Entity Address, City or Town | Bethesda | ||
Entity Address, State or Province | MD | ||
Entity Address, Postal Zip Code | 20814 | ||
City Area Code | (301) | ||
Local Phone Number | 961-4895 | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | ||
Trading Symbol | CTM | ||
Security Exchange Name | NYSEAMER | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 13,942,989 | ||
Entity Common Stock, Shares Outstanding | 53,029,915 | ||
Documents Incorporated by Reference | The information required by Part III (Items 10, 11, 12, 13 and 14) of this Annual Report on Form 10-K, to the extent not set forth herein, is incorporated herein by reference from the registrant's definitive proxy statement relating to the Annual Meeting of Shareholders to be held in 2024, which definitive proxy statement shall be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Annual Report on Form 10-K relates | ||
Entity Central Index Key | 0001877939 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 49 |
Auditor Name | RSM US LLP |
Auditor Location | McLean, Virginia |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash | $ 1,830,841 | $ 4,640,896 |
Accounts receivable | 6,883,566 | 5,193,562 |
Contract assets | 160,649 | 257,434 |
Prepaid income taxes | 216,909 | 351,116 |
Prepaid expenses and other current assets | 404,228 | 222,995 |
Total current assets | 9,496,193 | 10,666,003 |
Fixed assets, net | 310,170 | 173,350 |
Noncurrent assets: | ||
Right of use asset – operating lease | 613,143 | 35,524 |
Intangible assets, net | 8,970,864 | 6,634,167 |
Goodwill | 10,716,907 | 15,533,964 |
Total noncurrent assets | 20,611,084 | 22,377,005 |
Total assets | 30,107,277 | 33,043,008 |
Current liabilities: | ||
Accounts payable and accrued expenses | 784,965 | 1,617,596 |
Accrued payroll and payroll related expenses | 2,925,312 | 1,869,517 |
Current portion of lease liability – operating lease | 185,263 | 22,054 |
Due to seller | 350,000 | |
Obligation to issue common and preferred stock | 255,940 | 0 |
Contingent earnout | 380,000 | 812,000 |
Derivative liability | 157,600 | 824,000 |
Revolving credit facility | 625,025 | 300,025 |
Total current liabilities | 7,977,092 | 7,758,540 |
Noncurrent liabilities: | ||
Deferred tax liability | 6,292 | 0 |
Lease liability – operating lease, net of current portion | 435,204 | 12,632 |
Contingent earnout, net of current portion | 340,000 | 0 |
Note payable – related party, net of current portion | 400,000 | 400,000 |
Total noncurrent liabilities | 9,181,496 | 7,752,552 |
Total liabilities | 17,158,588 | 15,511,092 |
Stockholders' Equity | ||
Common stock, par value $0.0001; 3,000,000,000 shares authorized, 47,672,427 and 41,699,363 shares issued and outstanding as of December 31, 2023 and 2022, respectively | 4,767 | 4,170 |
Additional paid in capital | 56,926,157 | 43,621,651 |
Accumulated deficit | (43,982,900) | (26,094,570) |
Total stockholders’ equity | 12,948,689 | 17,531,916 |
Total liabilities and stockholders' equity | 30,107,277 | 33,043,008 |
Global Technology Management Resources, Inc | ||
Noncurrent assets: | ||
Goodwill | 2,102,037 | |
Related Party | ||
Current liabilities: | ||
Current portion of convertible promissory notes – related parties, net of discount | 238,212 | 0 |
Noncurrent liabilities: | ||
Notes payable, noncurrent | 2,000,000 | 999,430 |
Related Party | Global Technology Management Resources, Inc | ||
Current liabilities: | ||
Due to seller | 280,000 | |
Nonrelated Party | ||
Current liabilities: | ||
Current portion of notes payable, net of discount | 2,074,775 | 2,033,348 |
Noncurrent liabilities: | ||
Notes payable, noncurrent | 6,000,000 | 6,340,490 |
Series A Preferred | ||
Stockholders' Equity | ||
Preferred stock, value, issued | $ 588 | $ 588 |
Preferred stock, shares outstanding (in shares) | 5,875,000 | 5,875,000 |
Preferred stock, shares issued (in shares) | 5,875,000 | 5,875,000 |
Series C Preferred | ||
Stockholders' Equity | ||
Preferred stock, value, issued | $ 77 | $ 77 |
Preferred stock, shares outstanding (in shares) | 770,000 | 770,000 |
Preferred stock, shares issued (in shares) | 770,000 | 770,000 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 3,000,000,000 | 3,000,000,000 |
Common stock, shares, issued (in shares) | 47,672,427 | 41,699,363 |
Common stock, shares outstanding (in shares) | 47,672,427 | 41,699,363 |
Series A Preferred | ||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock par or stated value per share (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued (in shares) | 5,875,000 | 5,875,000 |
Preferred stock, shares outstanding (in shares) | 5,875,000 | 5,875,000 |
Series B Preferred | ||
Preferred stock, shares authorized (in shares) | 10,000,000 | |
Preferred stock par or stated value per share (in usd per share) | $ 0.0001 | |
Preferred stock, shares issued (in shares) | 0 | 3,610,000 |
Preferred stock, shares outstanding (in shares) | 0 | 3,610,000 |
Series C Preferred | ||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock par or stated value per share (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued (in shares) | 770,000 | 770,000 |
Preferred stock, shares outstanding (in shares) | 770,000 | 770,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | |||
Revenues | $ 45,243,812 | $ 42,190,643 | $ 25,067,450 |
Cost of revenues | 26,568,485 | 24,593,326 | 13,992,898 |
Gross profit | 18,675,327 | 17,597,317 | 11,074,552 |
Operating expenses: | |||
Indirect costs | 8,935,113 | 11,859,401 | 3,409,649 |
Overhead | 1,884,059 | 1,560,252 | 850,999 |
General and administrative | 17,697,886 | 13,586,600 | 14,539,053 |
Goodwill impairment loss | 6,919,094 | 0 | 0 |
(Gain) loss from change in fair value of contingent earnout | (92,000) | 555,000 | 0 |
Total operating expenses | 35,344,152 | 27,561,253 | 18,799,701 |
Loss from operations before other income (expense) | (16,668,825) | (9,963,936) | (7,725,149) |
Other income (expense): | |||
Loss on induced conversion | (300,000) | 0 | 0 |
Gain (loss) from change in fair value of derivative liability | 1,054,025 | (132,000) | 0 |
Other income, net | 106,419 | 303 | 38,851 |
Interest expense, net of interest income | (3,248,914) | (3,992,809) | (2,516,775) |
Total other (expense) | (2,388,470) | (4,124,506) | (2,477,924) |
Loss from operations before (expense) benefit for income taxes | (19,057,295) | (14,088,442) | (10,203,073) |
Income tax benefit (expense) | 1,257,117 | (819,596) | 2,656,643 |
Net loss | (17,800,178) | (14,908,038) | (7,546,430) |
Less: preferred stock dividends | 118,152 | 100,516 | 12,290 |
Net loss to common shareholders | $ (17,918,330) | $ (15,008,554) | $ (7,558,720) |
Net loss per share | |||
Net loss per share, basic (in usd per share) | $ (0.38) | $ (0.55) | $ (0.41) |
Net loss per share, diluted (in usd per share) | $ (0.38) | $ (0.55) | $ (0.41) |
Shares used in calculation of net loss per share - basic (in shares) | 47,177,950 | 27,468,226 | 18,259,283 |
Shares used in calculation of net loss per share - diluted (in shares) | 47,177,950 | 27,468,226 | 18,259,283 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net loss | $ (17,800,178) | $ (14,908,038) | $ (7,546,430) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 2,528,815 | 2,032,459 | 1,886,228 |
Amortization of discounts, premiums and deferred cost | 2,265,061 | 2,553,317 | 1,806,848 |
Stock-based compensation | 7,495,759 | 8,796,641 | 6,919,524 |
Deferred tax provision | (1,480,166) | 610,033 | (2,895,571) |
Gain on sale of fixed assets | 0 | (303) | 0 |
Financing fee and bank charges for note payable and advances on revolving credit line | 0 | 3,775 | 0 |
Realized gain on investment | 0 | 0 | (38,851) |
Goodwill impairment loss | 6,919,094 | 0 | 0 |
Lease cost | 218,314 | 1,139 | 754 |
Legal fees paid out of proceeds from note payable | 0 | 30,000 | 0 |
Change in fair value of contingent earnout | (92,000) | 555,000 | 0 |
Change in fair value of derivative liabilities | (1,054,025) | 132,000 | 0 |
Gain (Loss) on Shares Issued During The Period Due To Timing Differences | (107,491) | 0 | 0 |
Changes in assets and liabilities | |||
Accounts receivable | (1,187,118) | 634,448 | (1,217,326) |
Proceeds From Factoring Accounts Receivable | 850,141 | 0 | 0 |
Prepaid expenses and other current assets | 75,614 | (321,593) | 8,119 |
Contract asset (liability) | 96,785 | 333,621 | (817,646) |
Payment of transaction costs in acquisition of business | 0 | 0 | (50,500) |
Lease liability | (185,261) | 0 | 0 |
Accounts payable and accrued expenses | (807,791) | 537,664 | 594,715 |
Net cash (used in) provided by operating activities | (2,264,447) | 990,163 | (1,350,136) |
Cash flows from investing activities: | |||
Acquisition of business, cash paid to seller | (485,739) | (250,000) | 0 |
Cash from factoring | (411,975) | 0 | 0 |
Cash received in acquisition | 475,000 | 0 | 453,480 |
Sale of investment | 0 | 0 | 365,572 |
Purchases of fixed assets | (18,271) | (89,282) | (10,218) |
Net cash (used in) provided by investing activities | (440,985) | (339,282) | 808,834 |
Cash flows from financing activities: | |||
Proceeds from revolving credit line | 325,000 | 300,000 | 0 |
Payment of debt issuance costs | (15,000) | 0 | 0 |
Proceeds from issuance of preferred and common stock | 126,000 | 625,000 | 645,000 |
Proceeds from note payable | 1,200,000 | 1,470,000 | 0 |
Proceeds from exercise of stock options | 0 | 12,000 | 8,000 |
Proceeds from stock offering related to uplisting | 0 | 2,000,756 | 0 |
Preferred stock dividend | (118,152) | (100,516) | (12,290) |
Repayment of convertible note payable – related party | 0 | (500,000) | (70,000) |
Repayment of line of credit, net | 0 | 0 | (12,249) |
Loss on induced conversion | 300,000 | 0 | 0 |
Repayment of amounts due to seller | (280,000) | (471,003) | 0 |
Repayment of notes payable | (1,642,471) | (1,364,137) | (411,626) |
Net cash (used in) provided by financing activities | (104,623) | 1,972,100 | 146,835 |
Net (decrease) increase in cash | (2,810,055) | 2,622,981 | (394,467) |
Cash - beginning of period | 4,640,896 | 2,017,915 | 2,412,382 |
Cash - end of period | 1,830,841 | 4,640,896 | 2,017,915 |
Supplemental disclosures: | |||
Cash paid for interest | 994,449 | 912,965 | 688,930 |
Cash paid for income taxes | 72,484 | 467,910 | 168,100 |
Summary of noncash activities: | |||
Extinguishment of debt discount - derivative liabilities | 171,128 | 0 | 0 |
Extinguishment of debt discount - debt issuance costs | 8,034 | 0 | 0 |
Debt discount on note payable | 28,000 | 500,000 | 0 |
Common shares issued for obligation to issue shares | 0 | 533,750 | 0 |
Derivative liabilities incurred for note payable | 421,000 | 692,000 | 0 |
Extinguishment of derivative liability | 33,375 | 0 | 0 |
Gain on extinguishment of convertible note payable - related party | 0 | 2,667,903 | 0 |
Adjustment to contingent consideration and customer relationships | 0 | 275,000 | 0 |
Fair value adjustment recognized on issuance of common stock in Securities Purchase Agreement | 0 | 93,000 | 0 |
Deferred issuance costs | 0 | 59,300 | 0 |
Conversion of Series B preferred shares to common stock | 0 | 1,805 | 0 |
Cancellation of shares offsetting acquisition of business | 0 | 0 | 400,000 |
Global Technology Management Resources, Inc | |||
Summary of noncash activities: | |||
Acquisition of business, common stock issued to seller | 5,304,561 | 0 | 0 |
Partial Conversion Of Notes Payable | |||
Summary of noncash activities: | |||
Partial conversion of note payable | $ 0 | $ 160,000 | $ 0 |
Consolidated Statement Of Chang
Consolidated Statement Of Changes In Stockholders' Equity (Deficit) - USD ($) | Total | Notes Payable | Revision of Prior Period, Error Correction, Adjustment | Private Placement | Series C Preferred Subscription Agreements | MFSI | Merrison | SSI | The Albers Group, LLC | Global Technology Management Resources, Inc | Warrant | Common Stock | Common Stock Notes Payable | Common Stock Private Placement | Common Stock Series C Preferred Subscription Agreements | Common Stock MFSI | Common Stock Merrison | Common Stock SSI | Common Stock The Albers Group, LLC | Common Stock Global Technology Management Resources, Inc | Additional Paid-In Capital | Additional Paid-In Capital Notes Payable | Additional Paid-In Capital Revision of Prior Period, Error Correction, Adjustment | Additional Paid-In Capital Private Placement | Additional Paid-In Capital Series C Preferred Subscription Agreements | Additional Paid-In Capital MFSI | Additional Paid-In Capital Merrison | Additional Paid-In Capital SSI | Additional Paid-In Capital The Albers Group, LLC | Additional Paid-In Capital Global Technology Management Resources, Inc | Additional Paid-In Capital Warrant | Accumulated Deficit | Accumulated Deficit Revision of Prior Period, Error Correction, Adjustment | Series A Preferred | Series A Preferred Preferred Stock | Series B Preferred | Series B Preferred Preferred Stock | Series B Preferred Common Stock | Series B Preferred Additional Paid-In Capital | Series C Preferred | Series C Preferred Preferred Stock | Series C Preferred Preferred Stock Series C Preferred Subscription Agreements | Series C Preferred Common Stock | |
Beginning balance (in shares) at Dec. 31, 2020 | 15,411,264 | 5,875,000 | 3,610,000 | 0 | ||||||||||||||||||||||||||||||||||||||||
Beginning balance at Dec. 31, 2020 | $ 2,608,526 | $ 1,541 | $ 6,133,332 | $ (3,527,296) | $ 588 | $ 361 | $ 0 | |||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation – options | 3,113,261 | 3,113,261 | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation - warrants | $ 3,806,263 | $ 3,806,263 | ||||||||||||||||||||||||||||||||||||||||||
Shares issued in acquisition (in shares) | 1,114,023 | 500,000 | 2,632,095 | 481,250 | ||||||||||||||||||||||||||||||||||||||||
Shares issued in acquisition | $ 1,782,437 | $ 1,595,000 | $ 7,822,350 | $ 1,925,000 | $ 111 | $ 50 | $ 263 | $ 49 | $ 1,782,326 | $ 1,594,950 | $ 7,822,087 | $ 1,924,951 | ||||||||||||||||||||||||||||||||
Cancellation of shares in acquisition of MFSI (in shares) | (250,000) | |||||||||||||||||||||||||||||||||||||||||||
Cancellation of shares in acquisition of MFSI | $ (400,000) | $ (25) | $ (399,975) | |||||||||||||||||||||||||||||||||||||||||
Shares issued in exercise of stock options (in shares) | 10,000 | |||||||||||||||||||||||||||||||||||||||||||
Shares issued in exercise of stock options | 8,000 | $ 1 | 7,999 | |||||||||||||||||||||||||||||||||||||||||
Stock issued during period, shares, new issues (in shares) | 62,000 | 620,000 | 620,000 | 1,240,000 | ||||||||||||||||||||||||||||||||||||||||
Stock issued during period, value, new issues | $ 620,000 | $ 6 | $ 619,932 | $ 62 | ||||||||||||||||||||||||||||||||||||||||
Deferred issuance costs | 0 | |||||||||||||||||||||||||||||||||||||||||||
Extinguishment of debt discount related to debt issuance | 0 | |||||||||||||||||||||||||||||||||||||||||||
Net loss | (7,558,720) | (7,558,720) | ||||||||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 19,960,632 | 5,875,000 | 3,610,000 | 620,000 | ||||||||||||||||||||||||||||||||||||||||
Ending balance at Dec. 31, 2021 | 15,322,117 | $ 1,996 | 26,405,126 | (11,086,016) | $ 588 | $ 361 | $ 62 | |||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation – options | 4,985,233 | 4,985,233 | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation - warrants | 3,496,912 | 3,496,912 | ||||||||||||||||||||||||||||||||||||||||||
Shares issued in exercise of stock options (in shares) | 15,000 | |||||||||||||||||||||||||||||||||||||||||||
Shares issued in exercise of stock options | 12,000 | $ 2 | 11,998 | |||||||||||||||||||||||||||||||||||||||||
Stock issued during period, shares, new issues (in shares) | 132,500 | 15,000 | 150,000 | 150,000 | ||||||||||||||||||||||||||||||||||||||||
Stock issued during period, value, new issues | 533,750 | $ 150,000 | $ 13 | $ 2 | 533,737 | $ 149,983 | $ 15 | |||||||||||||||||||||||||||||||||||||
Stock-based compensation - shares issued for services and restricted stock (in shares) | 75,000 | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation - shares issued for services and Restricted stock | 379,499 | $ 8 | 379,491 | |||||||||||||||||||||||||||||||||||||||||
Shares issued for uplisting (in shares) | 1,351,231 | |||||||||||||||||||||||||||||||||||||||||||
Shares issued for uplisting, net of offering costs of approximately $$700,000 | 2,000,756 | $ 135 | 2,000,621 | |||||||||||||||||||||||||||||||||||||||||
Shares issued for cash including fair value adjustment (in shares) | 1,250,000 | |||||||||||||||||||||||||||||||||||||||||||
Shares issued for cash including fair value adjustment | 500,000 | $ 125 | 499,875 | |||||||||||||||||||||||||||||||||||||||||
Debt discount recognized for obligation to issue common stock | (100,000) | (100,000) | ||||||||||||||||||||||||||||||||||||||||||
Fair value adjustment on common stock for Crom | 93,000 | 93,000 | ||||||||||||||||||||||||||||||||||||||||||
Deferred issuance costs (in shares) | 125,000 | |||||||||||||||||||||||||||||||||||||||||||
Deferred issuance costs | 59,300 | $ 12 | 59,288 | |||||||||||||||||||||||||||||||||||||||||
Common shares issued in conversion (in shares) | 100,000 | (3,610,000) | 18,050,000 | |||||||||||||||||||||||||||||||||||||||||
Common shares issued in conversion | $ 160,000 | $ 10 | $ 159,990 | $ 0 | $ (361) | $ 1,805 | $ (1,444) | |||||||||||||||||||||||||||||||||||||
Extinguishment of debt discount related to debt issuance | 0 | |||||||||||||||||||||||||||||||||||||||||||
Net loss | (15,008,554) | (15,008,554) | ||||||||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 41,699,363 | 5,875,000 | 0 | 770,000 | ||||||||||||||||||||||||||||||||||||||||
Ending balance at Dec. 31, 2022 | $ 17,531,916 | $ 4,170 | 43,621,651 | (26,094,570) | $ 588 | $ 0 | $ 77 | |||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||
Preferred stock par or stated value per share (in usd per share) | $ 0.0001 | $ 0.0001 | ||||||||||||||||||||||||||||||||||||||||||
Common stock par or stated value per share (in usd per share) | $ 0.0001 | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation – options | $ 5,923,200 | 5,923,200 | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation - warrants | $ 1,076,969 | $ 1,076,969 | ||||||||||||||||||||||||||||||||||||||||||
Shares issued in acquisition (in shares) | 4,866,570 | |||||||||||||||||||||||||||||||||||||||||||
Shares issued in acquisition | $ 5,304,562 | $ 487 | $ 5,304,075 | |||||||||||||||||||||||||||||||||||||||||
Stock issued during period, shares, new issues (in shares) | 63,000 | |||||||||||||||||||||||||||||||||||||||||||
Stock issued during period, value, new issues | $ 126,000 | $ 6 | $ 125,994 | |||||||||||||||||||||||||||||||||||||||||
Stock-based compensation - shares issued for services and restricted stock (in shares) | 462,244 | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation - shares issued for services and Restricted stock | 423,659 | $ 45 | 423,614 | |||||||||||||||||||||||||||||||||||||||||
Deferred issuance costs | 0 | |||||||||||||||||||||||||||||||||||||||||||
Common shares issued in conversion (in shares) | 556,250 | |||||||||||||||||||||||||||||||||||||||||||
Common shares issued in conversion | 590,000 | $ 56 | 589,944 | |||||||||||||||||||||||||||||||||||||||||
Loss on induced conversion | 300,000 | 300,000 | ||||||||||||||||||||||||||||||||||||||||||
Extinguishment of debt discount related to derivative liability | (171,128) | (171,128) | ||||||||||||||||||||||||||||||||||||||||||
Extinguishment of debt discount related to debt issuance | (8,034) | (8,034) | ||||||||||||||||||||||||||||||||||||||||||
Extinguishment of derivative liability | 33,375 | 33,375 | ||||||||||||||||||||||||||||||||||||||||||
Stock issued as commitment shares in Crom transaction (in shares) | 25,000 | |||||||||||||||||||||||||||||||||||||||||||
Shares issued as commitment shares in Crom Transaction | 11,000 | $ 3 | 10,997 | |||||||||||||||||||||||||||||||||||||||||
Balance sheet reclassification adjustment | [1] | $ (274,500) | $ (304,500) | $ 30,000 | ||||||||||||||||||||||||||||||||||||||||
Net loss | (17,918,330) | (17,918,330) | ||||||||||||||||||||||||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2023 | 47,672,427 | 5,875,000 | 0 | 770,000 | ||||||||||||||||||||||||||||||||||||||||
Ending balance at Dec. 31, 2023 | $ 12,948,689 | $ 4,767 | $ 56,926,157 | $ (43,982,900) | $ 588 | $ 0 | $ 77 | |||||||||||||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||||||||||||||||||
Preferred stock par or stated value per share (in usd per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||||||||||||||||||||||||||||||||||
Common stock par or stated value per share (in usd per share) | $ 0.0001 | |||||||||||||||||||||||||||||||||||||||||||
[1] (a) In the second quarter of 2023, the Company made an immaterial balance sheet reclassification to reduce additional paid in capital by $304,500 and to increase the obligation to issue common shares account and the accumulated deficit account by $274,500 and $30,000, respectively. These immaterial amounts are also reflected in the Company's Consolidated Balance Sheets, Consolidated Statements of Cash Flows, and the Consolidated Statement of Changes in Stockholders' Equity. |
Consolidated Statement Of Cha_2
Consolidated Statement Of Changes In Stockholders' Equity (Deficit) - Parenthetical (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Uplisting, offering costs | $ 700,000 |
Nature of Operations
Nature of Operations | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations Castellum, Inc. (the “Company”) is focused on building a large, successful technology company in the areas of information technology, electronic warfare, information warfare and cybersecurity with businesses in the governmental and commercial markets. Services include intelligence analysis, software development, software engineering, program management, strategic planning, information assurance and cybersecurity and policy along with analysis support. These services, which largely focus on securing data and establishing related policies, are applicable to customers in the federal government, financial services, healthcare and other users of large data applications. The services can be delivered to legacy, customer owned networks or customers who rely upon cloud-based infrastructures. The Company has worked with multiple business brokers and contacts within their business network to identify potential acquisitions. Bayberry Acquisition Corporation (“Bayberry”) was a wholly owned subsidiary of the Company. Jay Wright and Mark Fuller controlled and managed Bayberry and were named officers and directors of the Company upon the acquisition of Bayberry. The transaction was accounted for as a reverse merger. As a result, Bayberry was considered the accounting acquirer. On February 23, 2021, Bayberry was dissolved with the Nevada Secretary of State as there was no activity, and Bayberry was non-operational post-merger with Castellum. Corvus Consulting, LLC (“Corvus”), acquired in November 2019, is a wholly owned subsidiary of the Company. Corvus provides scientific, engineering, technical, operational support, and training services to federal government and commercial clients. Corvus focuses on Cyberspace Operations, Electronic Warfare, Information Operations, Intelligence and Joint/Electromagnetic Spectrum Operations. The specialties of Corvus range from high-level policy development and Congressional liaison to requirements analysis, DOTMLPF-p development assistance and design services for hardware and software systems fulfilling the mission needs of the Department of Defense and Intelligence Communities. The Company entered into a definitive merger agreement with Mainnerve Federal Services, Inc. dba MFSI Government Group, a Delaware corporation (“MFSI”), effective as of January 1, 2021. This acquisition closed on February 11, 2021. MFSI, a government contractor, has built strong relationships with numerous customers, in the software engineering and IT arena. MFSI provides services in data security and operations for Army, Navy and Intelligence Community clients, and currently works as a software engineering/development, database administration and data analytics subcontractor. The Company acquired Merrison Technologies, LLC, a Virginia limited liability company (“Merrison”), on August 5, 2021. Merrison, is a government contractor with expertise in software engineering and IT in the classified arena. Effective December 1, 2023, all operations, contracts and employees were merged into the Corvus entity and Merrison was dissolved with the Virginia Secretary of State. Specialty Systems, Inc. (“SSI”) was acquired August 12, 2021. SSI is a New Jersey based government contractor that provides critical mission support to the Navy at Joint Base McGuire-Dix-Lakehurst in the areas of software engineering, cyber security, systems engineering, program support and network engineering. The Company acquired certain business assets from The Albers Group, LLC located in Pax River, Maryland (“Pax River”) which closed on November 16, 2021 in an asset purchase for up to 550,000 shares of common stock and cash of $200,000 paid monthly over a 10-month period starting February 2022 upon the satisfaction of conditions in the acquisition agreement. The Company acquired Lexington Solutions Group, LLC (“LSG”), on April 15, 2022. LSG is a government contractor with a wide range of national security, strategic communication, and management consulting services. The Company acquired Global Technologies Management Resources, Inc. (“GTMR”) on March 23, 2023. GTMR is a government contractor based in Hollywood, Maryland near Naval Air Station Patuxent River. On July 19, 2021, the Company filed a Certificate of Amendment with the State of Nevada to change the par value of all common and preferred stock to all be $0.0001. All changes to the par value dollar amount for these classes of stock and adjustment to additional paid in capital have been made retroactively. On October 13, 2022, the Company completed a $3,000,000 public offering, a 1-for-20 Reverse Stock Split of its common shares, and an uplisting to the NYSE American exchange. All share and per share figures related to the common stock have been retroactively adjusted in accordance with SEC Staff Accounting Bulletin (“SAB”) Topic 4C. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). Principles of Consolidation The consolidated financial statements include the accounts of Castellum, Inc. and its subsidiaries, collectively referred to as “the Company”. All significant intercompany accounts and transactions have been eliminated in consolidation. Castellum, Inc. owns 100% of Corvus, MFSI, Merrison (until dissolved as of December 1, 2023), and SSI. The Company applies the guidance of Topic 805 Business Combinations of the Financial Accounting Standards Board Accounting Standards Codification (“ASC”). The Company accounted for these acquisitions as business combinations and the difference between the consideration paid and the net assets acquired was first attributed to identified intangible assets and the remainder of the difference was applied to goodwill. Reclassification The Company has reclassified certain amounts in the 2022 financial statements to comply with the 2023 presentation. These principally relate to classification of “Gain on Disposal of Fixed Assets” to “Other” on our consolidated statements of operations. The reclassifications had no impact on total net loss or net cash flows for the years ended December 31, 2023 and 2022. Business Segments Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM, the Chief Executive Officer, reviews consolidated results of operations to make decisions. The Company maintains one operating and reportable segment, which is the delivery of products and services in the areas of information technology, electronic warfare, information warfare and cybersecurity in the governmental and commercial markets. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. These estimates include, but are not limited to, management’s estimate of provisions required for uncollectible accounts receivable, the acquired value of the intangible assets, impaired value of intangible assets, liabilities to accrue, cost incurred in the satisfaction of performance obligations, fair value for consideration elements of business combinations, permanent and temporary differences related to income taxes and determination of the fair value of stock awards. Actual results could differ from those estimates. Cash Cash consists of cash and demand deposits with an original maturity of three months or less. The Company holds no cash equivalents as of December 31, 2023 and 2022, respectively. The Company maintains cash balances in excess of the FDIC insured limit at a single bank. The Company does not consider this risk to be material. Fixed Assets and Long-Lived Assets, Including Intangible Assets and Goodwill Fixed assets are stated at cost. Depreciation on fixed assets is computed using the straight-line method over the estimated useful lives of the assets, which range from three ASC 360 requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment effective April 1, 2017. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets. Intangible assets with finite useful lives are stated at cost less accumulated amortization and impairment. Intangible assets capitalized as of December 31, 2023 represent the valuation of the Company’s customer relationships, trade names, backlog and non-compete agreements which were acquired in the acquisitions. These intangible assets are being amortized on either the straight-line basis over their estimated average useful lives (certain trademarks, tradenames, backlog and non-compete agreements) or are being amortized based on the present value of the future cash flows (customer relationships, certain tradenames, backlog, and non-compete agreements). Amortization expense of the intangible assets runs through March 2038. The Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following: 1. Significant underperformance relative to expected historical or projected future operating results; 2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and 3. Significant negative industry or economic trends. When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on fair value. Si gnificant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. When the Company acquires a controlling financial interest through a business combination, the Company uses the acquisition method of accounting to allocate the purchase consideration to the assets acquired and liabilities assumed, which are recorded at fair value. Any excess of purchase consideration over the net fair value of the net assets acquired is recognized as goodwill. Prior to 2022, the Company performed its annual goodwill and intangible asset impairment test at the end of the fourth quarter. In 2022, the Company changed the date of its annual goodwill and intangible asset impairment assessment to the first day of the fourth quarter. The Company believes this change does not represent a material change in method of applying an accounting principle. This voluntary change is preferable under the circumstances as it results in better alignment with the timing of the Company’s long-range planning and forecasting process and provides the Company with additional time to complete its annual goodwill impairment testing in advance of its year-end reporting. This change does not delay, accelerate, or avoid an impairment of goodwill. During the third quarter of 2023, due to decline in stock price, Management determined that a triggering event occurred representing an indicator of goodwill impairment and requiring goodwill impairment testing for each of its reporting units as of September 30, 2023. Management elected to bypass a qualitative assessment and performed a quantitative assessment, including a market capitalization reconciliation, to evaluate the performance of its reporting units. The impairment assessment resulted in a non-cash goodwill impairment charge related to all three reporting units totaling $6,919,094. Given the date of this assessment, Management concluded it satisfied the Company’s annual assessment requirement. Additionally, during the fourth quarter of 2023, Management considered whether there were any additional triggering events that would represent indicators of impairment and determined there were none. Subsequent Events Subsequent events were evaluated through March 21, 2024, the date the consolidated financial statements for the year ended December 31, 2023 were issued . Revenue Recognition The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ ASC 606” ) . The Company accounts for a contract with a customer that is within the scope of this Topic only when the five steps of revenue recognition under ASC 606 are met. The five core principles will be evaluated for each service provided by the Company and is further supported by applicable guidance in ASC 606 to support the Company’s recognition of revenue. Revenue is derived primarily from services provided to the federal government. The Company enters into agreements with customers that create enforceable rights and obligations and for which it is probable that the Company will collect the consideration to which it will be entitled as services and solutions are transferred to the customer. The Company also evaluates whether two or more agreements should be accounted for as one single contract. When determining the total transaction price, the Company identifies both fixed and variable consideration elements within the contract. The Company estimates variable consideration as the most likely amount to which the Company expects to be entitled limited to the extent that it is probable that a significant reversal will not occur in a subsequent period. At contract inception, the Company determines whether the goods or services to be provided are to be accounted for as a single performance obligation or as multiple performance obligations. For most contracts, the customers require the Company to perform several tasks in providing an integrated output and, hence, each of these contracts are deemed as having only one performance obligation. When contracts are separated into multiple performance obligations, the Company allocates the total transaction price to each performance obligation based on the estimated relative standalone selling prices of the promised services underlying each performance obligation. This evaluation requires professional judgment, and it may impact the timing and pattern of revenue recognition. If multiple performance obligations are identified, the Company generally uses the cost plus a margin approach to determine the relative standalone selling price of each performance obligation. The Company does not assess whether a contract contains a significant financing component if the Company expects, at contract inception, that the period between when payment by the client and the transfer of promised services to the client occur will be less than one year. The Company currently generates its revenue from three different types of contractual arrangements: cost plus fixed fee (“CPFF”), firm-fixed-price contracts (“FFP”) and time-and-materials (“T&M”) contracts. The Company generally recognizes revenue over time as control is transferred to the customer, based on the extent of progress towards satisfaction of the performance obligation. The selection of the method used to measure progress requires judgment and is dependent on the contract type and the nature of the goods or services to be provided. For CPFF contracts, the Company uses input progress measures to derive revenue based on hours worked on contract performance as follows: direct costs plus Defense Contract Audit Agency (“DCAA”) approved provisional burdens plus fee. The provisional indirect rates are adjusted and billed at actual at year end. Revenue from FFP contracts is generally recognized ratably over the contract term, using a time-based measure of progress, even if billing is based on other metrics or milestones, including specific deliverables. For T&M contracts, the Company uses input progress measures to estimate revenue earned based on hours worked on contract performance at negotiated billing rates, plus direct costs and indirect cost burdens associated with materials and the direct expenses incurred in performance of the contract. These arrangements generally qualify for the “right-to-invoice” practical expedient where revenue is recognized in proportion to billable consideration. FFP Level-Of-Effort contracts are substantially similar to T&M contracts except that the Company is required to deliver a specified level of effort over a stated period. For these contracts, the Company estimates revenue earned using contract hours worked at negotiated bill rates as the Company delivers the contractually required workforce. Revenue generated by Contract Support Service contracts is recognized over time as services are provided, based on the transfer of control. Revenue generated by FFP contracts is recognized over time as performance obligations are satisfied. Most contracts do not contain variable consideration and contract modifications are generally minimal. For these reasons, there is not a significant impact of electing these transition practical expedients. Revenue generated from contracts with federal, state, and local governments is recorded over time, rather than at a point in time. Under the Contract Support Services contracts, the Company performs software design work as it is assigned by the customer, and bills the customer, generally semi-monthly, on either a CPFF or T&M basis, as labor hours are expended. Certain other government contracts for software development have specific deliverables and are structured as FFP contracts, which are generally billed as the performance obligations under the contract are met. Revenue recognition under FFP contracts require judgment to allocate the transaction price to the performance obligations. Contracts may have terms up to five years. Contract accounting requires judgment relative to assessing risks and estimating contract revenue and costs and assumptions for schedule and technical issues. Due to the size and nature of contracts, estimates of revenue and costs are subject to a number of variables. For contract change orders, claims or similar items, judgment is required for estimating the amounts, assessing the potential for realization and determining whether realization is probable. Estimates of total contract revenue and costs are continuously monitored during the term of the contract and are subject to revision as the contract progresses. From time to time, facts develop that require revisions of revenue recognized or cost estimates. To the extent that a revised estimate affects the current or an earlier period, the cumulative effect of the revision is recognized in the period in which the facts requiring the revision become known. The Company accounts for contract costs in accordance with ASC Topic 340-40, Contracts with Customers. The Company recognizes the cost of sales of a contract as expense when incurred or at the time a performance obligation is satisfied. The Company recognizes an asset from the costs to fulfill a contract only if the costs relate directly to a contract, the costs generate or enhance resources that will be used in satisfying a performance obligation in the future and the costs are expected to be recovered. The incremental costs of obtaining a contract are capitalized unless the costs would have been incurred regardless of whether the contract was obtained. The following table disaggregates the Company’s revenue by contract type for the years ended December 31: 2023 2022 2021 Revenue: Time and material $ 25,631,786 $ 25,302,224 $ 15,381,979 Firm fixed price 3,129,520 3,350,084 4,864,638 Cost plus fixed fee 16,482,505 13,538,335 4,745,646 Other — — 75,187 Total $ 45,243,811 $ 42,190,643 $ 25,067,450 Contract Balances Contract assets include unbilled amounts typically resulting from FFP contracts when the revenue recognized exceeds the amounts billed to the customer on uncompleted contracts. Contract liabilities consist of billings in excess of costs and estimated earnings on uncompleted contracts. In accordance with industry practice, contract assets and liabilities related to costs and estimated earnings in excess of billings on uncompleted contracts, and billings in excess of costs and estimated earnings on uncompleted contracts, have been classified as current. The contract cycle for certain long-term contracts may extend beyond one year; thus, collection of the amounts related to these contracts may extend beyond one year. Derivative Financial Instruments Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of certain of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Valuations derived from various models are subject to ongoing internal and external verification and review. The model used incorporates market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss). With the issuance of the July 2017 FASB ASU 2017-11, “ Earnings Per Share (Topic 260 ) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815 ) ,” which addresses the complexity of accounting for certain financial instruments. Under current GAAP, an equity-linked financial instrument that otherwise is not required to be classified as a liability under the guidance Topic 480 is evaluated under the guidance in Topic 815, Derivatives and Hedging , to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), a reporting entity is required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date. The amendments in this accounting standards update revise the guidance for instruments with embedded features in Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity , which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. Accounts Receivable and Concentration of Credit Risk An allowance for credit losses is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible. Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. The Company does not charge interest on accounts receivable; however, United States (“U.S.”) government agencies may pay interest on invoices outstanding more than 30 days. Interest income is recorded when received. As of December 31, 2023 and 2022, management did not consider an allowance for credit losses is necessary. The Company’s customer base is concentrated with a relatively small number of customers. The Company does not generally require collateral or other security to support accounts receivable. To reduce credit risk, the Company performs ongoing credit evaluations on its customers’ financial condition. The Company establishes allowances for credit losses based upon factors surrounding the credit risk of customers, historical trends and other information. For the years ended December 31, 2023, 2022, and 2021, the Company had three customers represent 52%, 62%, and 61% of revenue earned, respectively. Any customer that represents 10% or greater of total revenue represents a risk. The Company also has three customers that represent 54% of the total accounts receivable as of December 31, 2023 and four customers that represented 60% of the total accounts receivable as of December 31, 2022. Accounting for Income Taxes Income taxes are accounted for under the asset and liability method. We estimate our income taxes in each of the jurisdictions where the Company operates. This process involves estimating our current tax expense or benefit together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheets. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. When assessing the realizability of deferred tax assets, we consider whether it is more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment, we consider the availability of loss carryforwards, projected reversals of deferred tax liabilities, projected future taxable income, and ongoing prudent and feasible tax planning strategies. We are subject to income taxes in the federal and state tax jurisdictions based upon our business operations in those jurisdictions. Significant judgment is required in evaluating uncertain tax positions. We record uncertain tax positions in accordance with ASC 740-10 on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position, and (2) with respect to those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. Management evaluates its tax positions on a quarterly basis. The Company files income tax returns in the U.S. federal tax jurisdiction and various state tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the Internal Revenue Service (“IRS”) and state taxing authorities, generally for three years after they were filed. Share-Based Compensation The Company follows ASC 718 Compensation – Stock Compensation and has adopted ASU 2017-09 Compensation – Stock Compensation (Topic 718) Scope of Modification Accounting . The Company calculates compensation expense for all awards granted, but not yet vested, based on the grant-date fair values. The Company recognizes these compensation costs, on a pro rata basis over the requisite service period of each vesting tranche of each award for service-based grants, and as the criteria is achieved for performance-based grants. The Company adopted ASU 2016-09 Improvements to Employee Share-Based Payment Accounting . Cash paid when shares are directly withheld for tax withholding purposes is classified as a financing activity in the statement of cash flows. Fair Value of Financial Instruments ASC 825 Financial Instruments requires the Company to disclose estimated fair values for its financial instruments. Fair value estimates, methods, and assumptions are set forth below for the Company’s financial instruments: The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued liabilities, approximate fair value because of the short-term maturity of those instruments. The fair value of debt reflects the price at which the debt instrument would transact between market participants, in an orderly transaction at the measurement date. The fair value of the equity consideration from business combinations are measured using the price of our common stock at the measurement date, along with applying an appropriate discount for lack of marketability. For contingent liabilities from business combinations, the fair value is measured on the acquisition date using an option pricing model. The Company does not utilize derivative instruments for hedging purposes. Earnings (Loss) Per Share of Common Stock Basic net income (loss) per common share is computed using the weighted average number of common shares outstanding, as well as a warrant to purchase 1,080,717 shares of common stock for a total aggregate exercise price of $1 granted in connection with the $5,600,000 note payable maturing September 30, 2024, as the cash consideration for the holder/grantee to receive common shares was determined to be nonsubstantive. Diluted earnings per share (“EPS”) include additional dilution from common stock equivalents, such as convertible notes, preferred stock, stock issuable pursuant to the exercise of stock options and all other warrants. Common stock equivalents are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for periods presented, so only the basic weighted average number of common shares are used in the computations. The Company subtracts dividends on preferred stock when calculating earnings (loss) per share. Refer to N ote 16 , Subsequent Events. Recent Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions The Company has completed the following acquisitions to achieve its business purposes as discussed in Note 1 ; GTMR On March 22, 2023, the Company entered into an agreement and plan of merger with GTMR. This acquisition was accounted for as a business combination whereby GTMR became a 100% owned subsidiary of the Company. The Company acquired GTMR to expand our capabilities, increase market share, gain access to new contracts, and achieve cost efficiencies through synergies and economies of scale. As the acquisition was an equity acquisition of GTMR, certain assets of the acquisition (intangible assets and goodwill) are not considered deductible for tax purposes. The following represents the preliminary assets and liabilities acquired in this acquisition: March 31, 2023 Adjustments December 31, 2023 Cash $ 475,000 $ — $ 475,000 Accounts receivable and other receivables 1,380,203 (9,384) 1,370,819 Income tax receivable 155,449 (127,992) 27,457 Prepaid expenses 116,892 (30,856) 86,036 Other assets 17,182 — 17,182 Furniture and equipment 163,301 103,760 267,061 Right of use asset - operating lease — 641,392 641,392 Customer relationships 2,426,000 — 2,426,000 Right of use - finance lease — 17,456 17,456 Tradename 517,000 — 517,000 Backlog 1,774,000 — 1,774,000 Goodwill 1,822,466 279,571 2,102,037 Deferred tax liability (1,244,368) (242,093) (1,486,461) Lease liability - operating lease (17,608) (603,799) (621,407) Lease liability - finance lease — (12,549) (12,549) Accounts payable and accrued expenses (1,030,957) 141,341 (889,616) Net assets acquired $ 6,554,560 $ 156,847 $ 6,711,407 The consideration paid for GTMR was as follows: Cash $ 470,233 Due to Seller 350,000 Other consideration 17,791 Cash from factoring 411,975 Common stock 5,304,561 Accounts receivable note 156,847 Total consideration paid $ 6,711,407 The GTMR Acquisition has been accounted for under the acquisition method of accounting. Under the acquisition method of accounting, the total acquisition consideration price was allocated to the assets acquired and liabilities assumed based on their preliminary estimated fair values. The fair value measurements utilize estimates based on key assumptions of the GTMR Acquisition, and historical and current market data. The excess of the purchase price over the total of the estimated fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill. To determine the fair values of tangible and intangible assets acquired and liabilities assumed for GTMR, we engaged a third-party independent valuation specialist. Intangible assets, which are primarily comprised of customer relationships and backlog, were valued using the excess earnings discounted cash flow method. On the date of the acquisition, the Company simultaneously factored $411,975 of the accounts receivable from GTMR to finance the acquisition. The Company had received a preliminary valuation from its specialist and recorded the value of the assets and liabilities acquired based on historical inputs and data as of March 22, 2023. The allocation of the purchase price is based on the best information available. The Company paid $185,896 in transaction costs of GTMR, which was excluded from the purchase price and issued an accounts receivable note (“Accounts Receivable Note”) and held back $350,000, the details for which have been discussed in amounts due to seller in Note 9 . During the measurement period (which is the period required to obtain all necessary information that existed at the acquisition date, or to conclude that such information is unavailable, not to exceed one year), additional assets or liabilities may be recognized, or there could be changes to the amounts of assets or liabilities previously recognized on a preliminary basis, if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in the recognition of these assets or liabilities as of that date. The measurement period for the GTMR acquisition is currently open and may remain open until March 22, 2024, but we do not anticipate any further adjustments. During the measurement period, the Company recorded several adjustments to goodwill as a result of GTMR's adoption of ASC 842, tax adjustments, and an update to the fair value of acquired furniture and equipment. These measurement period adjustments were subsequently identified as a result of the completion of third party accounting assistance. The Company also recorded a measurement period adjustment to goodwill as a result of finalizing the transaction price. The Company entered into an accounts receivable note payable due to the sellers four months after the closing date of the transaction, subject to the adjustment of any net working capital deficiencies. This amount was determined to be $156,847. Lexington Solutions Group (“LSG”) On April 15, 2022, the Company entered into Amendment No. 1 to Business Acquisition Agreement (“LSG Business Acquisition Agreement”) with LSG to acquire the assets of LSG. This LSG Business Acquisition Agreement superseded the Business Acquisition Agreement originally entered into on February 11, 2022. Under the terms of the LSG Business Acquisition Agreement, the Company acquired assets and assumed liabilities of LSG for consideration as follows: (a) 625,000 shares of common stock (600,000 shares paid at closing (issued on May 4, 2022) and 25,000 shares to be held and due within three business days of payment of the second tranche of cash described below); and (b) cash payments as follows: $250,000 due at closing (“initial cash payment”); $250,000 plus or minus any applicable post-closing adjustments paid on the date that is six months after the closing date (“second tranche”) (paid in October 2022); and $280,000 that was due no later than 10 months after the closing date of the acquisition (paid in January 2023). As the acquisition was of the assets of LSG, intangible assets and goodwill are considered deductible for tax purposes. The following represents the assets and liabilities acquired in this acquisition: Receivable from Seller $ 413,609 Due from employee/travel advance 5,000 Miscellaneous license 2,394 Customer relationships 785,000 Non-compete agreements 10,000 Backlog 489,000 Goodwill 1,471,000 Net Assets acquired 3,176,003 The consideration paid for the acquisition of LSG was as follows: Common stock (600,000 shares issued May 4, 2022) 2,280,000 Holdback shares (25,000 shares due six months after the closing date) 95,000 Cash 521,003 Due to seller (cash) 280,000 $ 3,176,003 The LSG acquisition has been accounted for under the acquisition method of accounting. Under the acquisition method of accounting, the total acquisition consideration price was allocated to the assets acquired and liabilities assumed based on their preliminary estimated fair values. The fair value measurements utilize estimates based on key assumptions of the LSG acquisition, and historical and current market data. The excess of the purchase price over the total of the estimated fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill. To determine the fair values of tangible and intangible assets acquired and liabilities assumed for LSG, the Company engaged a third-party independent valuation specialist. The Company had received a valuation from its specialist and recorded the value of the assets and liabilities acquired based on historical inputs and data as of April 15, 2022. The allocation of the purchase price is based on the best information available. The Company paid $44,752 in transaction costs of LSG, which was excluded from the purchase price. During the measurement period (which is the period required to obtain all necessary information that existed at the acquisition date, or to conclude that such information is unavailable, not to exceed one year), additional assets or liabilities may be recognized, or there could be changes to the amounts of assets or liabilities previously recognized on a preliminary basis, if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in the recognition of these assets or liabilities as of that date. There have been no adjustments for the year ended December 31, 2023 and the measurement period was closed April 15, 2023. For all acquisitions disclosed, there were no transaction costs that were not recognized as an expense. The following table shows unaudited pro-forma results for the year ended December 31, 2023 and 2022, as if the acquisitions of GTMR and LSG had occurred on January 1, 2022. These unaudited pro forma results of operations are based on the historical financial statements of each of the companies. For the year ended December 31, 2023 Revenues $ 47,890,783 Net loss $ (17,893,806) Net loss per share - basic $ (0.37) For the year ended December 31, 2022 Revenues $ 54,080,245 Net loss $ (14,816,304) Net loss per share - basic $ (0.53) |
Fixed Assets
Fixed Assets | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | Fixed Assets Fixed assets consisted of the following as of December 31: 2023 2022 Equipment and software $ 258,091 $ 141,732 Furniture 43,119 32,574 Automobile 43,928 — Leasehold improvements 192,959 83,266 Total fixed assets 538,097 257,572 Accumulated depreciation (227,927) (84,222) Fixed assets, net $ 310,170 $ 173,350 Depreciation expense for the years ended December 31, 2023, 2022, and 2021 was $148,512, $62,026, and $19,120 respectively. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible assets consisted of the following as of December 31, 2023 and December 31, 2022: December 31, 2023 Gross carrying value Accumulated Amortization Net carrying value Customer relationships 4.5– 15 years $ 11,961,000 $ (5,529,674) $ 6,431,326 Trade name 4.5 years 783,000 (363,938) 419,062 Trademark 15 years 533,864 (145,277) 388,587 Backlog 2 years 3,210,000 (1,513,986) 1,696,014 Non-compete agreement 3-4 years 684,000 (648,125) 35,875 $ 17,171,864 $ (8,201,000) $ 8,970,864 December 31, 2022 Customer relationships 4.5– 15 years $ 9,535,000 $ (3,916,501) $ 5,618,499 Trade name 4.5 years 266,000 (245,336) 20,664 Trademark 15 years 533,864 (88,119) 445,745 Backlog 2 years 1,436,000 (1,077,616) 358,384 Non-compete agreement 3-4 years 684,000 (493,125) 190,875 $ 12,454,864 $ (5,820,697) $ 6,634,167 The intangible assets, with the exception of the trademarks, were recorded as part of the acquisitions of Corvus, MFSI, Merrison, LSG, SSI and GTMR. Amortization expense for the years ended December 31, 2023, 2022, and 2021 was $2,380,303, $1,970,433, and $1,867,108 respectively, and the intangible assets are being amortized based on the estimated future lives as noted above. Future amortization of the intangible assets for the next five years as of December 31 are as follows: 2024 $ 2,074,686 2025 1,453,000 2026 1,242,863 2027 1,034,302 2028 543,592 Thereafter 2,622,421 Total $ 8,970,864 The following table presents changes to goodwill for the years ended December 31, 2023 and 2022 for each reporting unit: Corvus SSI MFSI Merrison Total December 31, 2021 $ 4,136,011 $ 8,461,150 $ 685,073 $ 780,730 $ 14,062,964 Goodwill acquired through acquisitions 1,471,000 — — — 1,471,000 Merrison subsumed into Corvus 780,730 — — (780,730) — December 31, 2022 6,387,741 8,461,150 685,073 — 15,533,964 Goodwill acquired through acquisitions — 2,102,037 — — 2,102,037 Impairment loss (4,429,000) (1,845,094) (645,000) — (6,919,094) December 31, 2023 $ 1,958,741 $ 8,718,093 $ 40,073 $ — $ 10,716,907 |
Convertible Promissory Notes -
Convertible Promissory Notes - Related Party | 12 Months Ended |
Dec. 31, 2023 | |
Convertible Notes Payable [Abstract] | |
Convertible Promissory Notes – Related Party | Convertible Promissory Notes – Related Party The Company entered into convertible promissory notes – related party as follows as of December 31: 2023 2022 Convertible note payable with a trust related to one of the Company’s former directors, convertible at $0.260 per share, at 5% interest, (extinguished on April 4, 2022 for new note) $ 3,209,617 $ 3,209,617 Total Convertible Notes Payable – Related Party $ 3,209,617 $ 3,209,617 Less: Debt discount (971,405) (2,210,187) $ 2,238,212 $ 999,430 Interest expense which includes amortization of discount and premium for the years ended December 31, 2023 and 2022 was $1,399,262 and $1,535,840, respectively. The amount of the debt discount recorded related to the conversion feature granted to the note holder was evaluated for characteristics of liability or equity and was determined to be equity under ASC 470 and ASC 480. The Company recognized this as additional paid in capital, and the discount is being amortized over the life of the note. On February 1, 2021, the two promissory notes with The Buckhout Charitable Remainder Trust (Laurie Buckhout – Trustee), were combined into one new note in the principal balance of $4,279,617, that has a new maturity date of February 1, 2024. The interest rate remains at 5% per annum. The conversion terms have remained at $0.26 per share. It was determined that under ASC 470, the debt amendment was considered a modification. Then again on August 12, 2021, the convertible note was amended to remove the principal payments and extend the debt further to September 30, 2024. It was determined that under ASC 470, the debt amendment was considered a modification. On April 4, 2022, the Company entered into a letter agreement with The Buckhout Charitable Remainder Trust (Laurie Buckhout – Trustee) whereby the Company made a partial repayment of $500,000 (“First Payment”) to reduce the note from $4,209,617 to $3,709,617. The First Payment of $500,000 was paid from proceeds from Crom Cortana Fund, LLC (“Crom”) as part of a unit agreement under the Securities Purchase Agreement (“SPA”) entered into with Crom on April 4, 2022. The Company commenced accruing interest on March 1, 2022, however, no payment of interest was due through October 31, 2022. The Company originally intended to make a second payment (“Second Payment”) of $2,709,617 at the time of an anticipated secondary offering, initially expected to occur on or about August 1, 2022, subject to extensions through October 31, 2022. However, given the timing of our secondary offering, the Second Payment did not occur during the third quarter of 2022 and the Company negotiated an extension of the Second Payment to October 31, 2022. In October 2022, the Company made an advanced principal payment of $500,000, further reducing the principal of the convertible promissory note to $3,209,617. On February 22, 2024, the Company entered into a new note payable with the Buckout Charitable Remainder Trust. As a result, a majority of the balance is reflected in non-current liabilities. Refer to subsequent events in Note 16 for more detail. |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2023 | |
Notes Payable [Abstract] | |
Notes Payable | Notes Payable The Company entered into notes payable as follows as of December 31: 2023 2022 Note payable at 7% originally due November 2023, maturing September 30, 2024 (a) $ 5,600,000 $ 5,600,000 Note payable at 10% interest dated February 28,2022 and matures the earlier of (i) September 30, 2024 or (ii) the acceleration of the obligations as contemplated under the promissory note including the successful completion of an equity offering of at least $15,000,000 (b) 400,000 400,000 Note payable at 12% interest dated April 6, 2023 and matures the earlier of (i) September 30, 2024 or (ii) the acceleration of the obligations as contemplated under the promissory note (c) 400,000 — Convertible note payable, convertible at $1.60 per share, at 7%, maturing April 4, 2023 (d) — 890,000 Convertible note payable, convertible at $1.20 per share, at 10%, maturing February 13, 2024 (d) 840,000 — Term note payable, at prime plus 3% interest, applied on a deferred basis (8.50% at December 31, 2023 and 6.25% at December 31, 2022) maturing August 11, 2024 981,764 2,324,236 Total Notes Payable 8,221,764 9,214,236 Less: Debt Discount (146,989) (840,398) $ 8,074,775 $ 8,373,838 (a) On August 12, 2021, the note payable was amended to extend the debt to September 30, 2024. It was determined that under ASC 470, the debt amendment was considered a modification. The amount of the debt discount recorded related to the warrants granted to the note holder was evaluated for characteristics of liability or equity and was determined to be equity under ASC 470 and ASC 480. (b) On February 28, 2022, the Company was obligated to issue 125,000 shares of common stock as further consideration for making this loan to the Company. The shares were issued in April 2022. (c) On April 6, 2023, the Company entered into a promissory note with principal balance of $400,000 bearing interest at 12% per annum. This promissory note matures at the earlier of September 30, 2024 or at the acceleration of the obligations under the promissory note (together with those discussed in a and b above, “Eisiminger Notes”). Interest is paid in monthly installments and the total principal is due upon maturity. (d) On February 13, 2023, the Company entered into a series of transactions with Crom Cortana Fund LLC (“Crom”), the primary purpose of which is related to the GTMR Acquisition entered into on March 22, 2023. In connection therewith, the Company and Crom entered into an agreement to pay off the amount owed to Crom under the terms of the convertible promissory note in the original principal amount of $1,050,000 due April 4, 2023 ("Prior Crom Note"). In consideration of a $300,000 cash payment and 556,250 shares of common stock representing conversion of the remaining principal balance of the Company’s obligations under the Prior Crom Note are deemed satisfied reducing the balance to zero; we induced conversion of the debt, which effectively extinguished the debt. Simultaneously therewith, the parties entered into the Securities Purchase Agreement (the “2023 SPA”) pursuant to which Crom purchased (a) a convertible promissory note in the principal amount of $840,000 (the “2023 Note Payable”), which matures February 13, 2024 and bears interest at a per annum rate equal to 10% to be paid monthly, and (b) a warrant pursuant to which Crom has the right to purchase up to 700,000 shares of the Company’s common stock (the “2023 Warrant”) at an exercise price of $1.38 which expires 60 months from the date of issuance. The proceeds of the 2023 Note Payable were used primarily to fund the GTMR acquisition, as well as fund the aforementioned debt repayment. Interest expense, which includes amortization of discount, for the years ended December 31, 2023, 2022, and 2021 was $1,732,265, $1,874,142, and $859,744 respectively. On April 4, 2022, the Company secured a $950,000 revolving credit facility with Live Oak Bank (“Revolving Credit Facility”). The Revolving Credit Facility matures on March 28, 2029, and draws on it are charged interest at the rate of prime plus 2.75% per annum. Interest is payable monthly. The outstanding balance as of December 31, 2023 and December 31, 2022, under the Revolving Credit Facility was $625,025 and $300,025, respectively. On February 22, 2024, the Company extended the maturity date of the Eisiminger Notes. As a result, the majority of the balance is reflected in non-current liabilities. Refer to subsequent events in Note 16 for more detail. Due to the subsequent events described under Note 16 , the total principal payments on our notes payable for the next three years are as follows: 2024 $ 2,221,764 2025 — 2026 6,000,000 Total $ 8,221,764 |
Note Payable - Related Party
Note Payable - Related Party | 12 Months Ended |
Dec. 31, 2023 | |
NOTE PAYABLE RELATED PARTY [Abstract] | |
Note Payable - Related Party | Note Payable – Related Party The Company entered into a note payable – related party as follows as of December 31: 2023 2022 Note payable at 5% due December 31, 2024, in connection with the acquisition of SSI $ 400,000 $ 400,000 |
Amount Due To Seller
Amount Due To Seller | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Amount Due To Seller | Amount Due To Seller In the acquisition of GTMR, the Company was obligated to pay $1,250,000 which included $350,000 held back to satisfy any net working capital deficiencies. This balance was originally scheduled to be paid six months following the closing date, however, payment has been postponed and the unpaid balance of $350,000 will accrue interest at an annual rate of 5% until it is paid in full in July of 2024. The $350,000 is recorded in current liabilities on the Company's Consolidated Balance Sheets as of December 31, 2023. In the acquisition of GTMR, the Company also issued an Accounts Receivable Note to the sellers of GTMR whereby the Company is obligated to pay the sellers a principal amount of $206,587, adjusted for deficiencies in net working capital, for four months following the closing date of the acquisition. The Company determined a net working capital deficiency of $49,740 resulting in an amount due to the sellers of $156,847. This amount was paid in full during the three months ended September 30, 2023. In the acquisition of LSG, the Company was obligated to pay $3,176,003, which included cash of $780,000 and a working capital adjustment of $21,003. Of this amount, $521,003 was paid by December 31, 2022. The remaining $280,000 of this balance was paid on January 23, 2023. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | Stockholders’ Equity (Deficit) On October 13, 2022, the Company effected a 1-for-20 reverse split of our authorized and outstanding shares of common stock. As a result of the Reverse Stock Split, all authorized and outstanding common stock and per share amounts in this Annual Report on Form 10-K, including but not limited to, the consolidated financial statements and footnotes included herein, have been adjusted to reflect the Reverse Stock Split for all periods presented. Preferred Stock The Company has 50,000,000 shares of preferred stock authorized. The Company has designated a Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock. The Series B Preferred Stock was fully converted into Common Stock during 2022, and as such, there is no outstanding Series B Preferred Stock as of December 31, 2023. Series A Preferred Stock The Company has designated 10,000,000 shares of Series A Preferred Stock, par value of $0.0001. On April 7, 2022, the Company amended the Certificate of Designation for its Series A Preferred Stock to (a) provide for an annualized dividend of $0.0125 per share to be paid monthly; (b) amend the conversion ratio for each share of Series A Preferred Stock to convert into two shares of common stock instead of 20 shares of common stock; and (c) provide for the Company to have the option to repurchase the Series A Preferred Stock at any time at a price of $1 per share. In connection with the Amendment to the Certificate of Designation, former officers of the Company (“Former Officers”) entered into a letter agreement dated April 4, 2022 with Crom and the Company for Crom to purchase 1,750,000 shares of Common Stock from the officers for $455,000, the proceeds of which were paid directly to the Former Officers. The letter agreement also provided for the Former Officers to sell certain amounts of the common stock they own through the date of the public offering. As of December 31, 2023 and December 31, 2022, the Company had 5,875,000 shares of Series A Preferred Stock issued and outstanding, respectively. The 5,875,000 shares were issued to the Former Officers of the Company in settlement of debt. For the year ended December 31, 2023, the Company has total preferred stock dividends recognized of $118,152, of which $72,624 is related to Series A Preferred Stock dividends. Series B Preferred Stock The Company has designated 10,000,000 shares of Series B Preferred Stock, par value of $0.0001. On October 17, 2022 the Company issued a total of 15,375,000 shares of Common Stock in connection with the conversion of all of its Series B preferred shares outstanding in connection with its public offering. As of December 31, 2023 and December 31, 2022, the Company had 0 and 3,610,000 shares of Series B Preferred Stock issued and outstanding, respectively. The 3,610,000 shares were issued to the shareholders, who are also directors of the Company, for the Bayberry acquisition in June 2019. Series C Preferred Stock The Company has designated 10,000,000 shares of Series C Preferred Stock, par value of $0.0001 (effective July 19, 2021). In the year ended December 31, 2022, the Company raised $150,000 for 150,000 shares of Series C Preferred Stock. In the year ended December 31, 2021, the Company raised $620,000 for 620,000 shares of Series C Preferred Stock along with 1,240,000 common shares. Each share of the Series C Preferred Stock is convertible into 0.625 common shares, and the Series C Preferred Stock pays a $0.06 dividend per Series C Preferred share per year. The dividend commenced accruing when the Series C Preferred Shares were fully designated and issued. For the year ended December 31, 2023, the Company has total preferred stock dividends recognized of $118,152 of which $45,528 is related to Series C Preferred Stock dividends. The Series C Preferred Stockholders under their subscription agreements were issued 0.1 common shares per Series C Preferred share for their investment. As a result, the Company issued 62,000 common shares for the 620,000 Series C Preferred shares purchased. As of December 31, 2022, another $25,000 was raised for an additional 25,000 Series C Preferred shares and 2,500 common shares that were not issued as of the balance sheet date. The $25,000 is reflected as an obligation to issue shares on the Consolidated Balance Sheet as of December 31, 2022. Common Stock The Company has 3,000,000,000 shares of common stock, par value $0.0001 authorized. The Company had 47,672,427 and 41,699,363 shares issued and outstanding as of December 31, 2023 and 2022, respectively. The holders of the Company’s Common Stock are entitled to one vote for each share of common stock held. On October 17, 2022, the Company closed its public offering of 1,500,000 shares of common stock consisting of 1,350,000 shares sold by the Company and 150,000 shares sold by certain selling stockholders, at a public offering price of $2.00 per share. In connection therewith, the Company issued 1,231 shares of common stock to stockholders with fractional shares resulting from the Reverse Stock Split. Warrants The following represents a summary of warrants for the years ended December 31: 2023 2022 Number Weighted Number Weighted Beginning balance 5,678,836 $ 1.84 3,161,568 $ 1.60 Granted 1,765,862 1.17 2,517,268 2.20 Ending balance 7,444,698 $ 1.68 5,678,836 $ 1.84 Intrinsic value of warrants $ 327,214 $ 1,374,303 Weighted Average Remaining Contractual Life (Years) 4.70 Options As of December 31, 2023, the Company has granted 522,265 shares of common stock under the Stock Incentive Plan. In addition, on November 9, 2021, the Company approved the 2021 Stock Incentive Plan (“Stock Incentive Plan”) that authorizes the Company to grant up to 2,500,000 shares of common stock. Prior to this date, the granting of options was not done pursuant to the terms of a stock incentive plan. The following represents a summary of options for the years ended December 31, 2023 and 2022: Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in Years) Weighted-Average Fair Value Outstanding, December 31, 2021 4,594,688 $ 2.09 6.21 $ 3.72 Granted 2,585,000 3.45 6.25 3.34 Exercised (15,000) 0.80 Forfeited (739,688) 2.41 Outstanding December 31, 2022 6,425,000 2.69 5.63 4.26 Granted 1,932,500 1.48 6.19 1.10 Exercised — — Forfeited (114,063) 2.00 Outstanding December 31, 2023 8,243,437 $ 2.41 4.98 $ 3.58 As of December 31, 2023 Vested and Exercisable 4,620,822 $ 2.44 4.70 $ 3.20 Stock based compensation expense related to stock options for the years ended December 31, 2023 and 2022 was $5,923,200 and $4,985,233, respectively, which is comprised of $4,675,129 and $3,852,606 in service-based grants and $1,248,071 and $1,132,627 in performance-based grants, for the years ended December 31, 2023 and 2022, respectively. In accordance with ASC 718-10-50, the Company measures the fair value of its share-based payment arrangements using the Black-Scholes model. The Company measures the share-based compensation on the grant date using the following assumptions: Year Ended December 31, 2023 2022 Expected term 7 years 7 years Expected volatility 161.61% - 166.14% 135.00%– 177.00% Expected dividend yield — — Risk-free interest rate 3.48% - 3.89% 0.10 % The Company measures the share-based compensation for all stock options and warrants that are not considered derivative liabilities using the Black-Scholes method with these assumptions, and any changes to these inputs can produce significantly higher or lower fair value measurements. The weighted average grant date fair value of the options granted during the years ended December 31, 2023 and 2022 was $1.10 and $3.34, respectively. The risk-free interest rate is based on the yield of a zero coupon U.S. Treasury Security with a maturity equal to the expected life of the stock option from the date of the grant. The assumption for expected volatility is based on the historical volatility of the Company. Aside from dividends paid on preferred shares, it is the Company's intent to retain all profits for the operations of the business for the foreseeable future, as such the dividend yield assumption is zero. |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. GAAP sets forth a three-level fair value hierarchy, which prioritizes the inputs used in measuring fair value. The three levels are as follows: Level 1 – defined as observable inputs, such as quoted market prices in active markets. Level 2 – defined as inputs other than quoted prices in active markets that are either directly or indirectly observable. Level 3 – defined as unobservable inputs in which little or no market data exists, therefore, requiring an entity to develop its own assumptions. Our financial assets and liabilities subject to the three-level fair value hierarchy consist principally of cash and cash equivalents, accounts receivable, accounts payable, contingent consideration and derivative liabilities. The estimated fair value of cash and cash equivalents, accounts receivable, fixed interest debt and accounts payable approximates their carrying value. On April 4, 2022, the Company issued common stock, a convertible note, and warrants in a securities purchase agreement (“SPA”), with Crom (“2022 Crom SPA”). The Company had evaluated the conversion option liability in the convertible note and the warrants to determine proper accounting treatment and determined them to be derivative liabilities (“Derivative Liabilities”). On February 13, 2023, the 2022 Crom SPA was terminated through an induced conversion thereby extinguishing the conversion option liability associated with the 2022 Crom note; the warrants were not affected. Concurrent with the termination of the 2022 Crom SPA, the Company issued common stock, a convertible note, and warrants in an SPA with Crom . The Company evaluated the conversion option in this convertible note and these warrants to determine proper accounting treatment and determined them to be derivative liabilities (also “Derivative Liabilities”). The Derivative Liabilities had and have been accounted for utilizing ASC 815 “Derivatives and Hedging.” The Company recognized liabilities for the estimated fair values of the Derivative Liabilities. The estimated fair values of these liabilities were calculated using a binomial pricing model with key input variables by an independent third party, as of the date of issuance, with changes in fair value recorded as gains or losses on revaluation in other income (expense). The contingent earnout included in total consideration for the SSI acquisition as of December 31, 2022, presented as part of current liabilities on the Consolidated Balance Sheets, was measured at fair value on a recurring basis using the present value approach, which incorporates factors such as revenue growth and forecasted adjusted EBITDA to estimate expected value. Changes in fair value of the contingent earnout were recorded as gains or losses on revaluation in operating expenses on the Consolidated Statements of Operations until the earnout amount was settled with the sellers of SSI. On February 15, 2024, the Company agreed to the amount and timing of the earnout payout. Please see Note 16 for subsequent events. The Company determined that the significant inputs used to value the Derivative Liabilities and the contingent earnout fall within Level 3 of the fair value hierarchy. As a result, the Company has determined that the valuation of its Derivative Liabilities and contingent earnout are classified in Level 3 of the fair value hierarchy as shown in the table below: Fair Value Measurements at December 31, 2023 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 157,600 $ 157,600 Fair Value Measurements at December 31, 2022 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 824,000 $ 824,000 Contingent earnout $ — $ — $ 812,000 $ 812,000 Total $ — $ — $ 1,636,000 $ 1,636,000 The Company’s Derivative Liabilities as of December 31 are as follows: 2023 2022 Inception Fair value of conversion option in 2022 Crom convertible note $ — $ 191,000 $ 314,000 Fair Value of 656,250 warrants on April 4, 2022 $ 66,000 $ 633,000 $ 378,000 Fair value of conversion option in 2023 Crom convertible note $ 200 $ — $ 162,000 Fair value of 700,000 warrants on February 13, 2023 $ 91,400 $ — $ 259,000 $ 157,600 $ 824,000 During the year ended December 31, 2023, 2022, and 2021 the Company recognized changes in the fair value of the Derivative Liabilities of $666,400, $824,000, and $0 respectively. Activity related to the Derivative Liabilities for the year ended December 31, 2023 is as follows: Beginning balance as of December 31, 2022 $ (824,000) Issuance of Derivative Liabilities (421,000) Change in fair value of Derivative Liabilities 1,087,400 Ending balance as of December 31, 2023 $ (157,600) Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of the Derivative Liabilities is estimated using a binomial valuation model. The assumptions, inputs and methodologies the Company uses in determining fair value result in inherent uncertainty due to the application of judgment. The following assumptions were used for the periods as follows: 2023 2022 Stock Price $ 0.30 $ 1.26 Conversion option - convertible note 1.20 1.60 Strike price - warrants 1.38 - 1.84 1.84 Term 0.12 years - 4.10 years 0.26 years - 4.26 years Volatility 98.00% - 148.30% 121.00% - 156.50% Market yield - conversion option 17.40 % 10.30 % Risk-free rate 3.90% - 5.60% 4.10% - 4.40% |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions During 2023, the Company granted warrants to two of its officers pursuant to the employment agreements with these officers as a bonus for closing the GTMR Acquisition. During 2022, the Company repaid $1,000,000 of note principal to a member of its Board of Directors in relation to payments on its related party note payable. For details on this note payable refer to Note 6 . In June 2021, the Company raised $220,000 for 220,000 shares of the to be designated Series C Preferred Stock along with 440,000 common shares from the newly hired Chief Growth Officer of the Company. In January 2021, August 2021, November 2021 and April 2022, the Company granted warrants to two of its officers pursuant to the employment agreements with these officers as a bonus for closing the MFSI, Merrison, SSI, Pax River (assets purchased from The Albers Group, LLC) and LSG transactions. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Defined Contribution Plan | Defined Contribution Plan The Company and its subsidiaries maintain 401(k) plans as a defined contribution retirement plan for all eligible employees. Each 401(k) plan provides for tax-deferred contributions of employees’ salaries, limited to a maximum annual amount as established by the IRS. The plans enroll employees immediately with no age or service requirement. The aggregate 401(k) Plan employer match was $882,707, $651,353 and $434,267 in the years ended December 31, 2023, 2022 and 2021, respectively. |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Commitments The Company, since April 2020, has entered into a series of employment agreements with management and key employees. The employment agreements are generally for terms ranging from three On April 1, 2020, the Company entered into employment agreements with both Mark Fuller and Jay Wright (the “Two Officers”). The agreements have a term of three years. Pursuant to the agreements, each of the Two Officers have a base salary of $240,000 per year and may be increased to $25,000 per month upon reaching an annualized revenue run rate of $25,000,000 or greater (which occurred in 2021), $30,000 per month upon reaching an annualized revenue of $50,000,000 or greater (which occurred in March, 2023), or $40,000 per month upon reaching an annualized revenue run rate of $75,000,000 or greater. The Company shall pay to the Two Officers a cash bonus equal to the lesser of (i) one percent (1%) of the trailing twelve months revenues of each company acquired during the term of the employment agreement, or (ii) four percent (4%) of the trailing twelve month EBITDA of each business acquired during the term of the employment agreement, provided that, for a bonus to be due, such acquisition must be accretive to the Company on both a revenue per share and EBITDA per share basis. Additionally, the Company shall issue 1 warrant to each of the Two Officers for each $1 of revenue acquired in any such acquisition with a 7-year term and a strike price equal to the price used in such acquisition or if no stock is used, the 30-day moving average closing price of the Company’s stock. An additional bonus of $50,000 and 500,000 warrants with a $2.00 strike price shall be paid to the the Two Officers upon the Company commencing trading on either the Nasdaq or the NYSE American (which occurred on October 13, 2022), and an additional bonus of $125,000 and 1,250,000 warrants with a $2.40 strike price shall be paid to each of the Two Officers upon the Company joining the Russell 3000 and/or Russell 2000 stock index(ices). On July 1, 2021, the Company entered into an employment agreement with its Chief Growth Officer for a period of four years, expiring June 30, 2025. Pursuant to the agreements, the Chief Growth Officer has a base salary of $250,000 per year and may be increased to $25,000 per month upon the Navy division reaching an annualized revenue run rate of $25,000,000 or greater (which occurred in 2021), $30,000 per month upon the Navy division reaching an annualized revenue of $60,000,000 or greater, or $40,000 per month upon the Navy division reaching an annualized revenue run rate of $100,000,000 or greater. The Chief Growth Officer is entitled to a bonus at the discretion of the Board of Directors annually. In addition, the Chief Growth Officer was granted 1,500,000 stock options, which 750,000 are considered time based grants over a vesting period of four years; and 750,000 are performance based grants as follows: (a) 250,000 upon the closing of an acquisition in the Navy division of a company with annualized revenue of $12 million or greater; (b) 250,000 upon the Navy division achieving $25 million in revenue and $2.5 million in EBITDA in any 12 month period; and (c) 250,000 upon the overall Company achieving $100 million in revenue run rate based on quarterly performance (i.e. $25 million in any calendar quarter). On August 5, 2021, the Company and the former executive of Merrison (the “Executive”) entered into an employment agreement for a period of three years through August 5, 2024. Under the employment agreement, the Executive shall be paid a base salary of $220,000 annually and receive 150,000 stock options. In addition, the Executive will be provided a bonus of $80,000 payable annually on August 31 each year, starting August 31, 2022, if and only if Merrison maintains an annualized net income of $500,000 for the one-year period ending on the applicable August 31. On August 12, 2021, the Company entered into several employment agreements for three On April 25, 2022, the Company entered into an employment agreement with its Chief Financial Officer (“CFO”). The employment agreement has a term of three years and five days and automatically renews for successive one-year periods unless terminated by the Company or the CFO, with 90 days advance notice of its intent not to renew. The agreement provides for an annual base salary of $275,000 (the “CFO Base Salary”). The CFO Base Salary will increase as follows: (i) $25,000 per month upon the Company achieving an annualized revenue run rate of $50,000,000 or greater (which occurred in March, 2023); (ii) $35,000 per month upon the Company achieving an annualized revenue run rate of $75,000,000 or greater; (iii) $40,000 per month upon the Company reaching an annualized revenue run rate of $150,000,000 or greater and EBITDA margin of no less than 7%; and (iv) $45,000 per month upon the Company reaching an annualized revenue run rate of $300,000,000 or greater and adjusted EBITDA margin of no less than 8%. Additionally, the CFO shall be eligible to earn a performance bonus at the discretion of the Board of the Company with target bonuses that are the following percentages of CFO Base Salary based on certain performance criteria set forth in the employment agreement: (i) 50% of CFO Base Salary of less than $35,000 per month; (ii) 60% of CFO Base Salary of $35,000 to less than $40,000 per month; and (iii) 100% of CFO Base Salary of $40,000 or more per month. The performance criteria include (a) ensure on time filing of all periodic filings (Form 10Q and Form 10K) and event driven filings (Schedule 13(d), Section 16 filings (Forms 3, 4, and 5) and Form 8K); (b) ensure on time filings and payment of all federal, state and local tax obligations; and (c) prepare an annual consolidated draft budget based on subsidiary budgets by October 31 each year. The CFO is entitled to earn an additional bonus of (i) $50,000 and 500,000 warrants to purchase the Company’s common stock with an exercise price of $2.00 upon the Company’s common stock trading on any tier of the Nasdaq or the New York Stock Exchange (which occurred on October 13, 2022), and (ii) $100,000 and 750,000 warrants to purchase the Company’s common stock with an exercise price of $2.40 upon the Company joining the Russell 3000 and/or Russell 2000 stock index(ices). The Board of the Company may pay an additional bonus (separate from any target) in its sole discretion. As an additional incentive for entering into the employment agreement, the CFO was granted 1,800,000 stock options to purchase the Company’s common stock at an exercise price of $3.80 per share which vest ratably over the first 36 months of employment with the Company. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table summarizes the significant differences between the U.S. federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31: 2023 2022 2021 Federal income taxes at statutory rate 21.00 % 21.00 % 21.00 % State income taxes at statutory rate 2.20 % 3.50 % 7.61 % Change in tax rate (0.80) % (2.90) % (1.58) % Permanent differences (3.60) % (7.70) % (0.98) % Other 0.50 % (1.70) % (0.04) % Goodwill impairment (6.30) % — % — % Change in valuation allowance (6.40) % (17.90) % — % Totals 6.60 % (5.70) % 26.01 % The following is a summary of the net deferred tax asset (liability) as of December 31: 2023 2022 2021 Deferred tax assets: Deferred interest $ 698,231 $ — $ — Lease liabilities 160,042 8,973 — Accrued expenses 352,346 148,776 95,673 Stock compensation 3,530,993 3,008,318 2,358,218 Transaction costs 44,665 41,817 53,881 Other 160 149,153 2,407 Total deferred tax assets 4,786,437 3,357,037 2,510,179 Deferred tax liabilities: Intangible assets (1,348,275) (939,607) (1,334,460) ROU Assets (156,788) (9,052) — Property and equipment (55,164) (8,569) (14,312) Debt discount (256,788) (741,579) (400,064) Cash to accrual method change (136,667) (43,443) (151,310) Total deferred tax liabilities (1,953,682) (1,742,250) (1,900,146) Valuation allowance $ (2,839,047) $ (1,614,787) $ — Net deferred tax assets (liabilities) $ (6,292) $ — $ 610,033 A full valuation allowance was established in the second quarter of 2022 due to the uncertainty of the utilization of deferred tax assets in future periods. In evaluating the Company’s ability to realize the deferred tax assets, management considered all available positive and negative evidence, including cumulative historic earnings, reversal of temporary differences, projected taxable income and tax planning strategies. The Company’s negative evidence, largely related to the Company's historical pre-tax net losses, currently outweighs its positive evidence of future taxable income therefore it is more-likely-than-not that the Company will not realize a significant portion of our deferred tax assets. The amount of the deferred tax asset to be realized in the future could however be adjusted if objective negative evidence is no longer present. The Company classifies accrued interest and penalties, if any, for unrecognized tax benefits as part of income tax expense. The Company did not accrue any penalties or interest as of December 31, 2023 and 2022. The provision (benefit) for income taxes for the years ended December 31 are as follows: 2023 2022 2021 Current $ 223,049 $ 209,563 $ 238,928 Deferred (1,480,166) 610,033 (2,895,571) Total $ (1,257,117) $ 819,596 $ (2,656,643) |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On January 25, 2024 the Company entered into a securities purchase agreement (the “SPA”) with an institutional investor, pursuant to which the Company agreed to sell and issue, in a registered direct offering, an aggregate of (i) 5,243,967 shares of the Company’s common stock, at a purchase price of $0.32 per share and accompanying warrant (the “Warrant”) and (ii) 3,193,534 pre-funded warrants (the “Pre-funded Warrant(s)”) to purchase up to an aggregate of 3,193,534 shares of common stock at a purchase price of $0.319 per Pre-funded Warrant and accompanying Warrant, for aggregate gross proceeds to the Company of approximately $2.7 million, before deducting the placement agent fees and estimated offering expenses payable by the Company (the “Registered Offering”). Pursuant to the terms of the SPA, in a concurrent private placement (the “Private Placement” and together with the Registered Offering, the “Offering”), the Company also sold and issued to the Purchaser warrants (the “Warrants”) to purchase up to 8,437,501 shares of common stock. The Warrants will become exercisable upon receipt of shareholder approval, expire five years from such approval, and have an exercise price of $0.35 per share. The shares, the Pre-Funded Warrants, and the Pre-Funded Warrant Shares are being offered pursuant to a shelf registration statement on Form S-3 (File No. 333-275840), which was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on December 12, 2023, and a related prospectus supplement dated January 25, 2024, related to the Registered Offering. The Offering closed on January 29, 2024. Pursuant to a placement agency agreement dated as of January 25, 2024 (the “Placement Agency Agreement”), the Company engaged Maxim Group LLC (“Maxim”) to act as the lead placement agent in connection with the Offering. At closing, the Company paid Maxim (i) a cash fee equal to 7.0% of the aggregate gross proceeds of the Offering and (ii) reimbursed Maxim for all reasonable and documented out-of-pocket expenses of $60,000, which included the reasonable fees, costs, and disbursements of its legal counsel. On February 13, 2024 the Company paid the outstanding principal and accrued interest owed on the 2023 Note Payable to Crom in the amount of $847,000. On February 16, 2024 the Company entered into a letter agreement to (i) extend the maturity date from December 31, 2024 to August 1, 2025 on the note payable dated August 12, 2021 in the principal amount of $400,000 that was issued in connection with the acquisition of SSI and (ii) require monthly principal payments of $50,000 per month for eight months commencing on the maturity date. All other terms of the note payable remain unchanged. On February 15, 2024 the Company entered into an agreement with the former shareholders of SSI concerning, among other things, the amount and timing of the earnout payment owed under the terms of the agreement and plan of merger dated August 12, 2021 between the Company, SSI, and the other parties named therein. With respect to the earnout payment, the parties agreed to settle the amount for a total of $720,000, with an initial payment of $180,000 to be made by the Company at signing of the agreement, plus monthly payments thereafter of $20,000 plus interest payable at 5% per annum for 27 months. As a result, $380,000 is reflected in current liabilities and $340,000 is reflected in non-current liabilities. On February 22, 2024 the Company entered into a $4,000,000 revolving credit facility with Live Oak Banking Company that bears interest at prime plus 2% interest which matures on February 22, 2025 (the “New Live Oak Revolver). The New Live Oak Revolver replaces the $950,000 revolving credit facility dated April 4, 2022 with Live Oak Banking Company with a maturity date of March 28, 2029. The Company rolled over approximately $625,000 of the principal balance outstanding on the prior revolving credit facility and made payments totaling $1,209,617 to the holders of two notes payable referred to in the next two paragraphs. On February 22, 2024 the Company entered into an agreement to extend the maturity date from September 30, 2024 to August 31, 2026 on the note payable dated November 21, 2019 in the principal amount of $5,600,000 and the note payable dated February 28, 2022 in the principal amount $400,000. Additionally, the per annum interest rate on t he Eisiminger Notes was set at 7.5% through February 1, 2025, after which it increases to 8.0%. All other terms of the notes payable remain unchanged. The Company accessed funds available on the New Live Oak Revolver to pay the outstanding principal and interest in full on the note payable dated April 6, 2023 in the principal amount of $400,000. The Company accessed funds available on the New Live Oak Revolver to pay $809,617 owed to The Buckhout Charitable Remainder Trust under the terms of the amended convertible promissory note payable in the principal amount of $3,209,617 which matures on September 30, 2024. Simultaneously therewith, the Company and The Buckhout Charitable Remainder Trust entered into a new note payable in the principal amount of $2,400,000 which matures on August 31, 2026, and accrues interest at a per annum rate of 5% through January 1, 2025, 8% per annum through January 1, 2026, and 12% per annum thereafter. The principal amount shall be amortized at the rate of $100,000 per month, commencing in September 2024. The terms of the new note payable to The Buckhout Charitable Remainder Trust do not permit the principal amount to be converted into common stock. On March 12, 2024, the Board of Directors approved the extension of the term of the Two Officers employment agreements until June 30, 2024. The employment agreements are described in Note 14 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net loss | $ (17,800,178) | $ (14,908,038) | $ (7,546,430) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Castellum, Inc. and its subsidiaries, collectively referred to as “the Company”. All significant intercompany accounts and transactions have been eliminated in consolidation. Castellum, Inc. owns 100% of Corvus, MFSI, Merrison (until dissolved as of December 1, 2023), and SSI. The Company applies the guidance of Topic 805 Business Combinations of the Financial Accounting Standards Board Accounting Standards Codification (“ASC”). The Company accounted for these acquisitions as business combinations and the difference between the consideration paid and the net assets acquired was first attributed to identified intangible assets and the remainder of the difference was applied to goodwill. |
Reclassification | Reclassification |
Business Segments | Business Segments Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM, the Chief Executive Officer, reviews consolidated results of operations to make decisions. The Company maintains one operating and reportable segment, which is the delivery of products and services in the areas of information technology, electronic warfare, information warfare and cybersecurity in the governmental and commercial markets. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. These estimates include, but are not limited to, management’s estimate of provisions required for uncollectible accounts receivable, the acquired value of the intangible assets, impaired value of intangible assets, liabilities to accrue, cost incurred in the satisfaction of performance obligations, fair value for consideration elements of business combinations, permanent and temporary differences related to income taxes and determination of the fair value of stock awards. Actual results could differ from those estimates. |
Cash | Cash |
Fixed Assets and Long-Lived Assets, Including Intangible Assets and Goodwill | Fixed Assets and Long-Lived Assets, Including Intangible Assets and Goodwill Fixed assets are stated at cost. Depreciation on fixed assets is computed using the straight-line method over the estimated useful lives of the assets, which range from three ASC 360 requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment effective April 1, 2017. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets. Intangible assets with finite useful lives are stated at cost less accumulated amortization and impairment. Intangible assets capitalized as of December 31, 2023 represent the valuation of the Company’s customer relationships, trade names, backlog and non-compete agreements which were acquired in the acquisitions. These intangible assets are being amortized on either the straight-line basis over their estimated average useful lives (certain trademarks, tradenames, backlog and non-compete agreements) or are being amortized based on the present value of the future cash flows (customer relationships, certain tradenames, backlog, and non-compete agreements). Amortization expense of the intangible assets runs through March 2038. The Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following: 1. Significant underperformance relative to expected historical or projected future operating results; 2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and 3. Significant negative industry or economic trends. When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on fair value. Si gnificant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. When the Company acquires a controlling financial interest through a business combination, the Company uses the acquisition method of accounting to allocate the purchase consideration to the assets acquired and liabilities assumed, which are recorded at fair value. Any excess of purchase consideration over the net fair value of the net assets acquired is recognized as goodwill. Prior to 2022, the Company performed its annual goodwill and intangible asset impairment test at the end of the fourth quarter. In 2022, the Company changed the date of its annual goodwill and intangible asset impairment assessment to the first day of the fourth quarter. The Company believes this change does not represent a material change in method of applying an accounting principle. This voluntary change is preferable under the circumstances as it results in better alignment with the timing of the Company’s long-range planning and forecasting process and provides the Company with additional time to complete its annual goodwill impairment testing in advance of its year-end reporting. This change does not delay, accelerate, or avoid an impairment of goodwill. |
Subsequent Events | Subsequent Events Subsequent events were evaluated through March 21, 2024, the date the consolidated financial statements for the year ended December 31, 2023 were issued |
Revenue Recognition And Contract Balances | Revenue Recognition The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ ASC 606” ) . The Company accounts for a contract with a customer that is within the scope of this Topic only when the five steps of revenue recognition under ASC 606 are met. The five core principles will be evaluated for each service provided by the Company and is further supported by applicable guidance in ASC 606 to support the Company’s recognition of revenue. Revenue is derived primarily from services provided to the federal government. The Company enters into agreements with customers that create enforceable rights and obligations and for which it is probable that the Company will collect the consideration to which it will be entitled as services and solutions are transferred to the customer. The Company also evaluates whether two or more agreements should be accounted for as one single contract. When determining the total transaction price, the Company identifies both fixed and variable consideration elements within the contract. The Company estimates variable consideration as the most likely amount to which the Company expects to be entitled limited to the extent that it is probable that a significant reversal will not occur in a subsequent period. At contract inception, the Company determines whether the goods or services to be provided are to be accounted for as a single performance obligation or as multiple performance obligations. For most contracts, the customers require the Company to perform several tasks in providing an integrated output and, hence, each of these contracts are deemed as having only one performance obligation. When contracts are separated into multiple performance obligations, the Company allocates the total transaction price to each performance obligation based on the estimated relative standalone selling prices of the promised services underlying each performance obligation. This evaluation requires professional judgment, and it may impact the timing and pattern of revenue recognition. If multiple performance obligations are identified, the Company generally uses the cost plus a margin approach to determine the relative standalone selling price of each performance obligation. The Company does not assess whether a contract contains a significant financing component if the Company expects, at contract inception, that the period between when payment by the client and the transfer of promised services to the client occur will be less than one year. The Company currently generates its revenue from three different types of contractual arrangements: cost plus fixed fee (“CPFF”), firm-fixed-price contracts (“FFP”) and time-and-materials (“T&M”) contracts. The Company generally recognizes revenue over time as control is transferred to the customer, based on the extent of progress towards satisfaction of the performance obligation. The selection of the method used to measure progress requires judgment and is dependent on the contract type and the nature of the goods or services to be provided. For CPFF contracts, the Company uses input progress measures to derive revenue based on hours worked on contract performance as follows: direct costs plus Defense Contract Audit Agency (“DCAA”) approved provisional burdens plus fee. The provisional indirect rates are adjusted and billed at actual at year end. Revenue from FFP contracts is generally recognized ratably over the contract term, using a time-based measure of progress, even if billing is based on other metrics or milestones, including specific deliverables. For T&M contracts, the Company uses input progress measures to estimate revenue earned based on hours worked on contract performance at negotiated billing rates, plus direct costs and indirect cost burdens associated with materials and the direct expenses incurred in performance of the contract. These arrangements generally qualify for the “right-to-invoice” practical expedient where revenue is recognized in proportion to billable consideration. FFP Level-Of-Effort contracts are substantially similar to T&M contracts except that the Company is required to deliver a specified level of effort over a stated period. For these contracts, the Company estimates revenue earned using contract hours worked at negotiated bill rates as the Company delivers the contractually required workforce. Revenue generated by Contract Support Service contracts is recognized over time as services are provided, based on the transfer of control. Revenue generated by FFP contracts is recognized over time as performance obligations are satisfied. Most contracts do not contain variable consideration and contract modifications are generally minimal. For these reasons, there is not a significant impact of electing these transition practical expedients. Revenue generated from contracts with federal, state, and local governments is recorded over time, rather than at a point in time. Under the Contract Support Services contracts, the Company performs software design work as it is assigned by the customer, and bills the customer, generally semi-monthly, on either a CPFF or T&M basis, as labor hours are expended. Certain other government contracts for software development have specific deliverables and are structured as FFP contracts, which are generally billed as the performance obligations under the contract are met. Revenue recognition under FFP contracts require judgment to allocate the transaction price to the performance obligations. Contracts may have terms up to five years. Contract accounting requires judgment relative to assessing risks and estimating contract revenue and costs and assumptions for schedule and technical issues. Due to the size and nature of contracts, estimates of revenue and costs are subject to a number of variables. For contract change orders, claims or similar items, judgment is required for estimating the amounts, assessing the potential for realization and determining whether realization is probable. Estimates of total contract revenue and costs are continuously monitored during the term of the contract and are subject to revision as the contract progresses. From time to time, facts develop that require revisions of revenue recognized or cost estimates. To the extent that a revised estimate affects the current or an earlier period, the cumulative effect of the revision is recognized in the period in which the facts requiring the revision become known. The Company accounts for contract costs in accordance with ASC Topic 340-40, Contracts with Customers. The Company recognizes the cost of sales of a contract as expense when incurred or at the time a performance obligation is satisfied. The Company recognizes an asset from the costs to fulfill a contract only if the costs relate directly to a contract, the costs generate or enhance resources that will be used in satisfying a performance obligation in the future and the costs are expected to be recovered. The incremental costs of obtaining a contract are capitalized unless the costs would have been incurred regardless of whether the contract was obtained. The following table disaggregates the Company’s revenue by contract type for the years ended December 31: 2023 2022 2021 Revenue: Time and material $ 25,631,786 $ 25,302,224 $ 15,381,979 Firm fixed price 3,129,520 3,350,084 4,864,638 Cost plus fixed fee 16,482,505 13,538,335 4,745,646 Other — — 75,187 Total $ 45,243,811 $ 42,190,643 $ 25,067,450 Contract Balances Contract assets include unbilled amounts typically resulting from FFP contracts when the revenue recognized exceeds the amounts billed to the customer on uncompleted contracts. Contract liabilities consist of billings in excess of costs and estimated earnings on uncompleted contracts. In accordance with industry practice, contract assets and liabilities related to costs and estimated earnings in excess of billings on uncompleted contracts, and billings in excess of costs and estimated earnings on uncompleted contracts, have been classified as current. The contract cycle for certain long-term contracts may extend beyond one year; thus, collection of the amounts related to these contracts may extend beyond one year. |
Derivative Financial Instruments | Derivative Financial Instruments Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of certain of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Valuations derived from various models are subject to ongoing internal and external verification and review. The model used incorporates market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss). With the issuance of the July 2017 FASB ASU 2017-11, “ Earnings Per Share (Topic 260 ) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815 ) ,” which addresses the complexity of accounting for certain financial instruments. Under current GAAP, an equity-linked financial instrument that otherwise is not required to be classified as a liability under the guidance Topic 480 is evaluated under the guidance in Topic 815, Derivatives and Hedging , to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), a reporting entity is required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date. The amendments in this accounting standards update revise the guidance for instruments with embedded features in Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity , which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. |
Accounts Receivable And Concentration Of Risk | Accounts Receivable and Concentration of Credit Risk An allowance for credit losses is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible. Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. The Company does not charge interest on accounts receivable; however, United States (“U.S.”) government agencies may pay interest on invoices outstanding more than 30 days. Interest income is recorded when received. As of December 31, 2023 and 2022, management did not consider an allowance for credit losses is necessary. The Company’s customer base is concentrated with a relatively small number of customers. The Company does not generally require collateral or other security to support accounts receivable. To reduce credit risk, the Company performs ongoing credit evaluations on its customers’ financial condition. The Company establishes allowances for credit losses based upon factors surrounding the credit risk of customers, historical trends and other information. |
Accounting for Income Taxes | Accounting for Income Taxes Income taxes are accounted for under the asset and liability method. We estimate our income taxes in each of the jurisdictions where the Company operates. This process involves estimating our current tax expense or benefit together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheets. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. When assessing the realizability of deferred tax assets, we consider whether it is more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment, we consider the availability of loss carryforwards, projected reversals of deferred tax liabilities, projected future taxable income, and ongoing prudent and feasible tax planning strategies. We are subject to income taxes in the federal and state tax jurisdictions based upon our business operations in those jurisdictions. Significant judgment is required in evaluating uncertain tax positions. We record uncertain tax positions in accordance with ASC 740-10 on the basis of a two-step process whereby (1) we determine whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position, and (2) with respect to those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. Management evaluates its tax positions on a quarterly basis. The Company files income tax returns in the U.S. federal tax jurisdiction and various state tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the Internal Revenue Service (“IRS”) and state taxing authorities, generally for three years after they were filed. |
Share-Based Compensation | Share-Based Compensation The Company follows ASC 718 Compensation – Stock Compensation and has adopted ASU 2017-09 Compensation – Stock Compensation (Topic 718) Scope of Modification Accounting . The Company calculates compensation expense for all awards granted, but not yet vested, based on the grant-date fair values. The Company recognizes these compensation costs, on a pro rata basis over the requisite service period of each vesting tranche of each award for service-based grants, and as the criteria is achieved for performance-based grants. The Company adopted ASU 2016-09 Improvements to Employee Share-Based Payment Accounting . Cash paid when shares are directly withheld for tax withholding purposes is classified as a financing activity in the statement of cash flows. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC 825 Financial Instruments requires the Company to disclose estimated fair values for its financial instruments. Fair value estimates, methods, and assumptions are set forth below for the Company’s financial instruments: The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued liabilities, approximate fair value because of the short-term maturity of those instruments. The fair value of debt reflects the price at which the debt instrument would transact between market participants, in an orderly transaction at the measurement date. The fair value of the equity consideration from business combinations are measured using the price of our common stock at the measurement date, along with applying an appropriate discount for lack of marketability. For contingent liabilities from business combinations, the fair value is measured on the acquisition date using an option pricing model. The Company does not utilize derivative instruments for hedging purposes. |
Earnings (Loss) Per Share of Common Stock | Earnings (Loss) Per Share of Common Stock Basic net income (loss) per common share is computed using the weighted average number of common shares outstanding, as well as a warrant to purchase 1,080,717 shares of common stock for a total aggregate exercise price of $1 granted in connection with the $5,600,000 note payable maturing September 30, 2024, as the cash consideration for the holder/grantee to receive common shares was determined to be nonsubstantive. Diluted earnings per share (“EPS”) include additional dilution from common stock equivalents, such as convertible notes, preferred stock, stock issuable pursuant to the exercise of stock options and all other warrants. Common stock equivalents are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for periods presented, so only the basic weighted average number of common shares are used in the computations. The Company subtracts dividends on preferred stock when calculating earnings (loss) per share. Refer to N ote 16 , Subsequent Events. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Company's Revenue By Contract Type | The following table disaggregates the Company’s revenue by contract type for the years ended December 31: 2023 2022 2021 Revenue: Time and material $ 25,631,786 $ 25,302,224 $ 15,381,979 Firm fixed price 3,129,520 3,350,084 4,864,638 Cost plus fixed fee 16,482,505 13,538,335 4,745,646 Other — — 75,187 Total $ 45,243,811 $ 42,190,643 $ 25,067,450 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Assets and Liabilities Acquired | The following represents the preliminary assets and liabilities acquired in this acquisition: March 31, 2023 Adjustments December 31, 2023 Cash $ 475,000 $ — $ 475,000 Accounts receivable and other receivables 1,380,203 (9,384) 1,370,819 Income tax receivable 155,449 (127,992) 27,457 Prepaid expenses 116,892 (30,856) 86,036 Other assets 17,182 — 17,182 Furniture and equipment 163,301 103,760 267,061 Right of use asset - operating lease — 641,392 641,392 Customer relationships 2,426,000 — 2,426,000 Right of use - finance lease — 17,456 17,456 Tradename 517,000 — 517,000 Backlog 1,774,000 — 1,774,000 Goodwill 1,822,466 279,571 2,102,037 Deferred tax liability (1,244,368) (242,093) (1,486,461) Lease liability - operating lease (17,608) (603,799) (621,407) Lease liability - finance lease — (12,549) (12,549) Accounts payable and accrued expenses (1,030,957) 141,341 (889,616) Net assets acquired $ 6,554,560 $ 156,847 $ 6,711,407 The consideration paid for GTMR was as follows: Cash $ 470,233 Due to Seller 350,000 Other consideration 17,791 Cash from factoring 411,975 Common stock 5,304,561 Accounts receivable note 156,847 Total consideration paid $ 6,711,407 The following represents the assets and liabilities acquired in this acquisition: Receivable from Seller $ 413,609 Due from employee/travel advance 5,000 Miscellaneous license 2,394 Customer relationships 785,000 Non-compete agreements 10,000 Backlog 489,000 Goodwill 1,471,000 Net Assets acquired 3,176,003 The consideration paid for the acquisition of LSG was as follows: Common stock (600,000 shares issued May 4, 2022) 2,280,000 Holdback shares (25,000 shares due six months after the closing date) 95,000 Cash 521,003 Due to seller (cash) 280,000 $ 3,176,003 |
Schedule of Business Acquisition, Pro Forma Information | These unaudited pro forma results of operations are based on the historical financial statements of each of the companies. For the year ended December 31, 2023 Revenues $ 47,890,783 Net loss $ (17,893,806) Net loss per share - basic $ (0.37) For the year ended December 31, 2022 Revenues $ 54,080,245 Net loss $ (14,816,304) Net loss per share - basic $ (0.53) |
Fixed Assets (Tables)
Fixed Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Fixed Assets | Fixed assets consisted of the following as of December 31: 2023 2022 Equipment and software $ 258,091 $ 141,732 Furniture 43,119 32,574 Automobile 43,928 — Leasehold improvements 192,959 83,266 Total fixed assets 538,097 257,572 Accumulated depreciation (227,927) (84,222) Fixed assets, net $ 310,170 $ 173,350 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets consisted of the following as of December 31, 2023 and December 31, 2022: December 31, 2023 Gross carrying value Accumulated Amortization Net carrying value Customer relationships 4.5– 15 years $ 11,961,000 $ (5,529,674) $ 6,431,326 Trade name 4.5 years 783,000 (363,938) 419,062 Trademark 15 years 533,864 (145,277) 388,587 Backlog 2 years 3,210,000 (1,513,986) 1,696,014 Non-compete agreement 3-4 years 684,000 (648,125) 35,875 $ 17,171,864 $ (8,201,000) $ 8,970,864 December 31, 2022 Customer relationships 4.5– 15 years $ 9,535,000 $ (3,916,501) $ 5,618,499 Trade name 4.5 years 266,000 (245,336) 20,664 Trademark 15 years 533,864 (88,119) 445,745 Backlog 2 years 1,436,000 (1,077,616) 358,384 Non-compete agreement 3-4 years 684,000 (493,125) 190,875 $ 12,454,864 $ (5,820,697) $ 6,634,167 |
Schedule of Future Amortization of Intangible Assets | Future amortization of the intangible assets for the next five years as of December 31 are as follows: 2024 $ 2,074,686 2025 1,453,000 2026 1,242,863 2027 1,034,302 2028 543,592 Thereafter 2,622,421 Total $ 8,970,864 |
Schedule of Goodwill | The following table presents changes to goodwill for the years ended December 31, 2023 and 2022 for each reporting unit: Corvus SSI MFSI Merrison Total December 31, 2021 $ 4,136,011 $ 8,461,150 $ 685,073 $ 780,730 $ 14,062,964 Goodwill acquired through acquisitions 1,471,000 — — — 1,471,000 Merrison subsumed into Corvus 780,730 — — (780,730) — December 31, 2022 6,387,741 8,461,150 685,073 — 15,533,964 Goodwill acquired through acquisitions — 2,102,037 — — 2,102,037 Impairment loss (4,429,000) (1,845,094) (645,000) — (6,919,094) December 31, 2023 $ 1,958,741 $ 8,718,093 $ 40,073 $ — $ 10,716,907 |
Convertible Promissory Notes _2
Convertible Promissory Notes - Related Party (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Convertible Notes Payable [Abstract] | |
Schedule of convertible promissory notes, Related party | The Company entered into convertible promissory notes – related party as follows as of December 31: 2023 2022 Convertible note payable with a trust related to one of the Company’s former directors, convertible at $0.260 per share, at 5% interest, (extinguished on April 4, 2022 for new note) $ 3,209,617 $ 3,209,617 Total Convertible Notes Payable – Related Party $ 3,209,617 $ 3,209,617 Less: Debt discount (971,405) (2,210,187) $ 2,238,212 $ 999,430 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Payable [Abstract] | |
Schedule of notes payable | The Company entered into notes payable as follows as of December 31: 2023 2022 Note payable at 7% originally due November 2023, maturing September 30, 2024 (a) $ 5,600,000 $ 5,600,000 Note payable at 10% interest dated February 28,2022 and matures the earlier of (i) September 30, 2024 or (ii) the acceleration of the obligations as contemplated under the promissory note including the successful completion of an equity offering of at least $15,000,000 (b) 400,000 400,000 Note payable at 12% interest dated April 6, 2023 and matures the earlier of (i) September 30, 2024 or (ii) the acceleration of the obligations as contemplated under the promissory note (c) 400,000 — Convertible note payable, convertible at $1.60 per share, at 7%, maturing April 4, 2023 (d) — 890,000 Convertible note payable, convertible at $1.20 per share, at 10%, maturing February 13, 2024 (d) 840,000 — Term note payable, at prime plus 3% interest, applied on a deferred basis (8.50% at December 31, 2023 and 6.25% at December 31, 2022) maturing August 11, 2024 981,764 2,324,236 Total Notes Payable 8,221,764 9,214,236 Less: Debt Discount (146,989) (840,398) $ 8,074,775 $ 8,373,838 (a) On August 12, 2021, the note payable was amended to extend the debt to September 30, 2024. It was determined that under ASC 470, the debt amendment was considered a modification. The amount of the debt discount recorded related to the warrants granted to the note holder was evaluated for characteristics of liability or equity and was determined to be equity under ASC 470 and ASC 480. (b) On February 28, 2022, the Company was obligated to issue 125,000 shares of common stock as further consideration for making this loan to the Company. The shares were issued in April 2022. (c) On April 6, 2023, the Company entered into a promissory note with principal balance of $400,000 bearing interest at 12% per annum. This promissory note matures at the earlier of September 30, 2024 or at the acceleration of the obligations under the promissory note (together with those discussed in a and b above, “Eisiminger Notes”). Interest is paid in monthly installments and the total principal is due upon maturity. (d) On February 13, 2023, the Company entered into a series of transactions with Crom Cortana Fund LLC (“Crom”), the primary purpose of which is related to the GTMR Acquisition entered into on March 22, 2023. In connection therewith, the Company and Crom entered into an agreement to pay off the amount owed to Crom under the terms of the convertible promissory note in the original principal amount of $1,050,000 due April 4, 2023 ("Prior Crom Note"). In consideration of a $300,000 cash payment and 556,250 shares of common stock representing conversion of the remaining principal balance of the Company’s obligations under the Prior Crom Note are deemed satisfied reducing the balance to zero; we induced conversion of the debt, which effectively extinguished the debt. Simultaneously therewith, the parties entered into the Securities Purchase Agreement (the “2023 SPA”) pursuant to which Crom purchased (a) a convertible promissory note in the principal amount of $840,000 (the “2023 Note Payable”), which matures February 13, 2024 and bears interest at a per annum rate equal to 10% to be paid monthly, and (b) a warrant pursuant to which Crom has the right to purchase up to 700,000 shares of the Company’s common stock (the “2023 Warrant”) at an exercise price of $1.38 which expires 60 months from the date of issuance. The proceeds of the 2023 Note Payable were used primarily to fund the GTMR acquisition, as well as fund the aforementioned debt repayment. |
Schedule of repayment, net of discounts | Due to the subsequent events described under Note 16 , the total principal payments on our notes payable for the next three years are as follows: 2024 $ 2,221,764 2025 — 2026 6,000,000 Total $ 8,221,764 |
Note Payable - Related Party (T
Note Payable - Related Party (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
NOTE PAYABLE RELATED PARTY [Abstract] | |
Schedule of notes payable to related party | The Company entered into a note payable – related party as follows as of December 31: 2023 2022 Note payable at 5% due December 31, 2024, in connection with the acquisition of SSI $ 400,000 $ 400,000 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Schedule of warrants | The following represents a summary of warrants for the years ended December 31: 2023 2022 Number Weighted Number Weighted Beginning balance 5,678,836 $ 1.84 3,161,568 $ 1.60 Granted 1,765,862 1.17 2,517,268 2.20 Ending balance 7,444,698 $ 1.68 5,678,836 $ 1.84 Intrinsic value of warrants $ 327,214 $ 1,374,303 Weighted Average Remaining Contractual Life (Years) 4.70 |
Schedule of options | The following represents a summary of options for the years ended December 31, 2023 and 2022: Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in Years) Weighted-Average Fair Value Outstanding, December 31, 2021 4,594,688 $ 2.09 6.21 $ 3.72 Granted 2,585,000 3.45 6.25 3.34 Exercised (15,000) 0.80 Forfeited (739,688) 2.41 Outstanding December 31, 2022 6,425,000 2.69 5.63 4.26 Granted 1,932,500 1.48 6.19 1.10 Exercised — — Forfeited (114,063) 2.00 Outstanding December 31, 2023 8,243,437 $ 2.41 4.98 $ 3.58 As of December 31, 2023 Vested and Exercisable 4,620,822 $ 2.44 4.70 $ 3.20 |
Schedule of Stock Options, Valuation Assumptions | The Company measures the share-based compensation on the grant date using the following assumptions: Year Ended December 31, 2023 2022 Expected term 7 years 7 years Expected volatility 161.61% - 166.14% 135.00%– 177.00% Expected dividend yield — — Risk-free interest rate 3.48% - 3.89% 0.10 % |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Summary of derivative liabilities and the contingent earnout fall | As a result, the Company has determined that the valuation of its Derivative Liabilities and contingent earnout are classified in Level 3 of the fair value hierarchy as shown in the table below: Fair Value Measurements at December 31, 2023 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 157,600 $ 157,600 Fair Value Measurements at December 31, 2022 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 824,000 $ 824,000 Contingent earnout $ — $ — $ 812,000 $ 812,000 Total $ — $ — $ 1,636,000 $ 1,636,000 |
Summary of derivative liabilities | The Company’s Derivative Liabilities as of December 31 are as follows: 2023 2022 Inception Fair value of conversion option in 2022 Crom convertible note $ — $ 191,000 $ 314,000 Fair Value of 656,250 warrants on April 4, 2022 $ 66,000 $ 633,000 $ 378,000 Fair value of conversion option in 2023 Crom convertible note $ 200 $ — $ 162,000 Fair value of 700,000 warrants on February 13, 2023 $ 91,400 $ — $ 259,000 $ 157,600 $ 824,000 |
Summary of change in the fair value of the derivative liabilities | Activity related to the Derivative Liabilities for the year ended December 31, 2023 is as follows: Beginning balance as of December 31, 2022 $ (824,000) Issuance of Derivative Liabilities (421,000) Change in fair value of Derivative Liabilities 1,087,400 Ending balance as of December 31, 2023 $ (157,600) |
Summary of fair value measurements | The following assumptions were used for the periods as follows: 2023 2022 Stock Price $ 0.30 $ 1.26 Conversion option - convertible note 1.20 1.60 Strike price - warrants 1.38 - 1.84 1.84 Term 0.12 years - 4.10 years 0.26 years - 4.26 years Volatility 98.00% - 148.30% 121.00% - 156.50% Market yield - conversion option 17.40 % 10.30 % Risk-free rate 3.90% - 5.60% 4.10% - 4.40% |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The following table summarizes the significant differences between the U.S. federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31: 2023 2022 2021 Federal income taxes at statutory rate 21.00 % 21.00 % 21.00 % State income taxes at statutory rate 2.20 % 3.50 % 7.61 % Change in tax rate (0.80) % (2.90) % (1.58) % Permanent differences (3.60) % (7.70) % (0.98) % Other 0.50 % (1.70) % (0.04) % Goodwill impairment (6.30) % — % — % Change in valuation allowance (6.40) % (17.90) % — % Totals 6.60 % (5.70) % 26.01 % |
Schedule of Deferred Tax Assets and Liabilities | The following is a summary of the net deferred tax asset (liability) as of December 31: 2023 2022 2021 Deferred tax assets: Deferred interest $ 698,231 $ — $ — Lease liabilities 160,042 8,973 — Accrued expenses 352,346 148,776 95,673 Stock compensation 3,530,993 3,008,318 2,358,218 Transaction costs 44,665 41,817 53,881 Other 160 149,153 2,407 Total deferred tax assets 4,786,437 3,357,037 2,510,179 Deferred tax liabilities: Intangible assets (1,348,275) (939,607) (1,334,460) ROU Assets (156,788) (9,052) — Property and equipment (55,164) (8,569) (14,312) Debt discount (256,788) (741,579) (400,064) Cash to accrual method change (136,667) (43,443) (151,310) Total deferred tax liabilities (1,953,682) (1,742,250) (1,900,146) Valuation allowance $ (2,839,047) $ (1,614,787) $ — Net deferred tax assets (liabilities) $ (6,292) $ — $ 610,033 |
Schedule of Components of Income Tax Expense (Benefit) | The provision (benefit) for income taxes for the years ended December 31 are as follows: 2023 2022 2021 Current $ 223,049 $ 209,563 $ 238,928 Deferred (1,480,166) 610,033 (2,895,571) Total $ (1,257,117) $ 819,596 $ (2,656,643) |
Nature of Operations - Addition
Nature of Operations - Additional Information (Detail) | 12 Months Ended | ||||||
Dec. 31, 2023 USD ($) $ / shares | Oct. 13, 2022 USD ($) | Nov. 16, 2021 USD ($) shares | Dec. 31, 2023 USD ($) $ / shares | Dec. 31, 2022 USD ($) $ / shares | Dec. 31, 2021 USD ($) | Jul. 19, 2021 $ / shares | |
Nature Of Operations [Line Items] | |||||||
Cash payment in asset purchase | $ 485,739 | $ 250,000 | $ 0 | ||||
Common stock, par value (in usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Public Offering | |||||||
Nature Of Operations [Line Items] | |||||||
Consideration received on transaction | $ 3,000,000 | ||||||
CISD | IPO | |||||||
Nature Of Operations [Line Items] | |||||||
Stock split ratio | 0.05 | ||||||
Certificate Of Amendment | |||||||
Nature Of Operations [Line Items] | |||||||
Preferred stock par or stated value per share (in usd per share) | $ / shares | $ 0.0001 | ||||||
Common stock, par value (in usd per share) | $ / shares | $ 0.0001 | ||||||
The Albers Group, LLC | |||||||
Nature Of Operations [Line Items] | |||||||
Shares issued in acquisition (in shares) | shares | 550,000 | ||||||
Cash payment in asset purchase | $ 200,000 | ||||||
Business combination, term to complete combination | 10 months | ||||||
Global Technology Management Resources, Inc | |||||||
Nature Of Operations [Line Items] | |||||||
Cash payment in asset purchase | $ 470,233 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | |||
Oct. 13, 2022 | Dec. 31, 2023 USD ($) reportingUnit segment $ / shares shares | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Accounting Policies [Line Items] | ||||
Ownership percentage by parent | 1 | |||
Number of operating segments | segment | 1 | |||
Number of reportable segments | segment | 1 | |||
Cash equivalents | $ 0 | $ 0 | ||
Number of securities covered by warrants or rights (in shares) | shares | 1,080,717 | |||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 1 | |||
Number of reporting units | reportingUnit | 3 | |||
Goodwill impairment loss | $ 6,919,094 | $ 0 | $ 0 | |
Minimum | ||||
Accounting Policies [Line Items] | ||||
Intangible assets, useful life | 3 years | |||
Maximum | ||||
Accounting Policies [Line Items] | ||||
Intangible assets, useful life | 15 years | |||
CISD | IPO | ||||
Accounting Policies [Line Items] | ||||
Stock split ratio | 0.05 | |||
Three Customers | Revenue, Product and Service Benchmark | Customer Concentration Risk | ||||
Accounting Policies [Line Items] | ||||
Concentration risk, percentage | 52% | 62% | 61% | |
Three Customers | Accounts Receivable | Customer Concentration Risk | ||||
Accounting Policies [Line Items] | ||||
Concentration risk, percentage | 54% | |||
Four Customers [Member] | Accounts Receivable | Customer Concentration Risk | ||||
Accounting Policies [Line Items] | ||||
Concentration risk, percentage | 60% | |||
Notes Payable Due 2024 | ||||
Accounting Policies [Line Items] | ||||
Debt instrument gross | $ 5,600,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Company's Revenue By Contract Type (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Accounting Policies [Line Items] | |||
Total | $ 45,243,811 | $ 42,190,643 | $ 25,067,450 |
Time and material | |||
Accounting Policies [Line Items] | |||
Total | 25,631,786 | 25,302,224 | 15,381,979 |
Firm fixed price | |||
Accounting Policies [Line Items] | |||
Total | 3,129,520 | 3,350,084 | 4,864,638 |
Cost plus fixed fee | |||
Accounting Policies [Line Items] | |||
Total | 16,482,505 | 13,538,335 | 4,745,646 |
Other | |||
Accounting Policies [Line Items] | |||
Total | $ 0 | $ 0 | $ 75,187 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) | 12 Months Ended | |||||||
Dec. 31, 2023 | Jun. 30, 2023 | Mar. 22, 2023 | Jan. 23, 2023 | Apr. 15, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||||||||
Cash from factoring | $ 411,975 | $ 0 | $ 0 | |||||
After closing date | 4 months | |||||||
Cash payment in asset purchase | $ 485,739 | 250,000 | $ 0 | |||||
Global Technology Management Resources, Inc | ||||||||
Business Acquisition [Line Items] | ||||||||
Business acquisition percentage of voting interests acquired | 100% | |||||||
Cash from factoring | $ 411,975 | |||||||
Business combination transaction costs incurred | $ 185,896 | |||||||
Accounts receivable note | 156,847 | $ 156,847 | 206,587 | |||||
Cash payment in asset purchase | $ 470,233 | |||||||
Transaction costs | $ 185,896 | |||||||
Revenues | $ 7,779,478 | |||||||
Lexington Solutions Group | ||||||||
Business Acquisition [Line Items] | ||||||||
Business combination transaction costs incurred | $ 44,752 | |||||||
Business combination equity interests issued or issuable number of shares (in shares) | 625,000 | |||||||
Shares issued in acquisition (in shares) | 600,000 | |||||||
Business combination contingent consideration payable in shares | 25,000 | |||||||
Cash payment in asset purchase | $ 521,003 | |||||||
Transaction costs | 44,752 | |||||||
Lexington Solutions Group | Tranche One | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash payment in asset purchase | 250,000 | |||||||
Lexington Solutions Group | Tranche Two | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash payment in asset purchase | $ 280,000 | 250,000 | $ 521,003 | |||||
Lexington Solutions Group | Tranche Three | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash payment in asset purchase | $ 280,000 |
Acquisitions - Schedule of Asse
Acquisitions - Schedule of Assets and Liabilities Acquired (Detail) - USD ($) | 9 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2023 | Jun. 30, 2023 | Mar. 22, 2023 | Apr. 15, 2022 | Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2023 | |
Business Acquisition [Line Items] | |||||||||
Furniture and equipment | $ 538,097 | $ 538,097 | $ 538,097 | $ 257,572 | |||||
Goodwill | 10,716,907 | 10,716,907 | 10,716,907 | 15,533,964 | $ 14,062,964 | ||||
The consideration paid for the acquisition | |||||||||
Cash | 485,739 | 250,000 | 0 | ||||||
Cash from factoring | 411,975 | $ 0 | $ 0 | ||||||
Global Technology Management Resources, Inc | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash | 475,000 | 475,000 | 475,000 | $ 475,000 | |||||
Adjustment to cash | 0 | ||||||||
Accounts receivable and other receivables | 1,370,819 | 1,370,819 | 1,370,819 | 1,380,203 | |||||
Adjustment to accounts receivable and other receivables | (9,384) | ||||||||
Income tax receivable | 27,457 | 27,457 | 27,457 | 155,449 | |||||
Adjustment to income tax receivable | (127,992) | ||||||||
Prepaid expenses | 86,036 | 86,036 | 86,036 | 116,892 | |||||
Adjustment to prepaid expenses | (30,856) | ||||||||
Other assets | 17,182 | 17,182 | 17,182 | 17,182 | |||||
Adjustment to other asset | 0 | ||||||||
Furniture and equipment | 267,061 | 267,061 | 267,061 | 163,301 | |||||
Adjustment to furniture and equipment | 103,760 | ||||||||
Right of use asset - operating lease | 641,392 | 641,392 | 641,392 | 0 | |||||
Adjustment to right of use asset - operating lease | 641,392 | ||||||||
Right of use - finance lease | 17,456 | 17,456 | 17,456 | 0 | |||||
Adjustment to right of use asset - finance lease | 17,456 | ||||||||
Goodwill | 2,102,037 | 2,102,037 | 2,102,037 | 1,822,466 | |||||
Goodwill purchase accounting adjustments | 279,571 | ||||||||
Deferred tax liability | (1,486,461) | (1,486,461) | (1,486,461) | (1,244,368) | |||||
Adjustment to deferred tax liability | (242,093) | ||||||||
Lease liability - operating lease | (621,407) | (621,407) | (621,407) | (17,608) | |||||
Adjustment to lease liability - operating lease | (603,799) | ||||||||
Lease liability - finance lease | (12,549) | (12,549) | (12,549) | 0 | |||||
Adjustment to lease liability - finance lease | (12,549) | ||||||||
Accounts payable and accrued expenses | (889,616) | (889,616) | (889,616) | (1,030,957) | |||||
Adjustment to accounts payable and accrued expenses | 141,341 | ||||||||
Net assets acquired | 6,711,407 | 6,711,407 | 6,711,407 | 6,554,560 | |||||
Adjustment of net assets acquired | 156,847 | ||||||||
The consideration paid for the acquisition | |||||||||
Cash | 470,233 | ||||||||
Due to Seller | 350,000 | ||||||||
Other consideration | 17,791 | ||||||||
Cash from factoring | 411,975 | ||||||||
Common stock | 5,304,561 | ||||||||
Accounts receivable note | 156,847 | $ 156,847 | $ 206,587 | ||||||
Total consideration paid | 6,711,407 | ||||||||
Global Technology Management Resources, Inc | Customer relationships | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | 2,426,000 | 2,426,000 | 2,426,000 | 2,426,000 | |||||
Adjustment to intangibles | 0 | ||||||||
Global Technology Management Resources, Inc | Tradename | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | 517,000 | 517,000 | 517,000 | 517,000 | |||||
Adjustment to intangibles | 0 | ||||||||
Global Technology Management Resources, Inc | Backlog | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | $ 1,774,000 | 1,774,000 | $ 1,774,000 | $ 1,774,000 | |||||
Adjustment to intangibles | $ 0 | ||||||||
Lexington Solutions Group | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 1,471,000 | ||||||||
Receivable from Seller | 413,609 | ||||||||
Due from employee/travel advance | 5,000 | ||||||||
Net assets acquired | 3,176,003 | ||||||||
The consideration paid for the acquisition | |||||||||
Cash | 521,003 | ||||||||
Common stock | 2,280,000 | ||||||||
Holdback shares | 95,000 | ||||||||
Due to seller (cash) | 280,000 | ||||||||
Total consideration paid | 3,176,003 | ||||||||
Lexington Solutions Group | Customer relationships | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | 785,000 | ||||||||
Lexington Solutions Group | Backlog | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | 489,000 | ||||||||
Lexington Solutions Group | Miscellaneous license | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | 2,394 | ||||||||
Lexington Solutions Group | Non-compete agreements | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangibles | $ 10,000 |
Acquisitions - Schedule of As_2
Acquisitions - Schedule of Assets and Liabilities Acquired (Parenthetical) (Detail) - Lexington Solutions Group - shares | May 04, 2022 | Apr. 15, 2022 |
Asset Acquisition [Line Items] | ||
Business acquisition, equity interest issued or issuable, number of shares (in shares) | 625,000 | |
Common Stock | ||
Asset Acquisition [Line Items] | ||
Business acquisition, equity interest issued or issuable, number of shares (in shares) | 600,000 | |
Holdback Shares | ||
Asset Acquisition [Line Items] | ||
Business acquisition, equity interest issued or issuable, number of shares (in shares) | 25,000 |
Acquisitions - Schedule of Busi
Acquisitions - Schedule of Business Acquisition, Pro Forma Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | ||
Revenues | $ 47,890,783 | $ 54,080,245 |
Net loss | $ (17,893,806) | $ (14,816,304) |
Net loss per share - basic (in usd per share) | $ (0.37) | $ (0.53) |
Fixed Assets - Summary of Fixed
Fixed Assets - Summary of Fixed Assets (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 538,097 | $ 257,572 |
Accumulated depreciation | (227,927) | (84,222) |
Fixed assets, net | 310,170 | 173,350 |
Equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | 258,091 | 141,732 |
Automobile | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | 43,928 | 0 |
Furniture | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | 43,119 | 32,574 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 192,959 | $ 83,266 |
Fixed Assets - Additional Infor
Fixed Assets - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 148,512 | $ 62,026 | $ 19,120 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Schedule of Intangible Assets (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | $ 17,171,864 | $ 12,454,864 |
Accumulated Amortization | (8,201,000) | (5,820,697) |
Net carrying value | $ 8,970,864 | 6,634,167 |
Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 3 years | |
Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 15 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | $ 11,961,000 | 9,535,000 |
Accumulated Amortization | (5,529,674) | (3,916,501) |
Net carrying value | $ 6,431,326 | $ 5,618,499 |
Customer relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 4 years 6 months | 4 years 6 months |
Customer relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 15 years | 15 years |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 4 years 6 months | 4 years 6 months |
Gross carrying value | $ 783,000 | $ 266,000 |
Accumulated Amortization | (363,938) | (245,336) |
Net carrying value | $ 419,062 | $ 20,664 |
Trademark | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 15 years | 15 years |
Gross carrying value | $ 533,864 | $ 533,864 |
Accumulated Amortization | (145,277) | (88,119) |
Net carrying value | $ 388,587 | $ 445,745 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 2 years | 2 years |
Gross carrying value | $ 3,210,000 | $ 1,436,000 |
Accumulated Amortization | (1,513,986) | (1,077,616) |
Net carrying value | 1,696,014 | 358,384 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | 684,000 | 684,000 |
Accumulated Amortization | (648,125) | (493,125) |
Net carrying value | $ 35,875 | $ 190,875 |
Non-compete agreements | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 3 years | 3 years |
Non-compete agreements | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, useful life | 4 years | 4 years |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization of intangible assets | $ 2,380,303 | $ 1,970,433 | $ 1,867,108 |
Goodwill impairment loss | $ 6,919,094 | $ 0 | $ 0 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Schedule of Future Amortization of Intangible Assets (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2024 | $ 2,074,686 | |
2025 | 1,453,000 | |
2026 | 1,242,863 | |
2027 | 1,034,302 | |
2028 | 543,592 | |
Thereafter | 2,622,421 | |
Net carrying value | $ 8,970,864 | $ 6,634,167 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Schedule of Goodwill (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | |||
Balance – beginning of period | $ 15,533,964 | $ 14,062,964 | |
Goodwill acquired through acquisitions | 2,102,037 | 1,471,000 | |
Merrison subsumed into Corvus | 0 | ||
Goodwill impairment loss | (6,919,094) | 0 | $ 0 |
Balance – ending of period | 10,716,907 | 15,533,964 | 14,062,964 |
Corvus | |||
Goodwill [Roll Forward] | |||
Balance – beginning of period | 6,387,741 | 4,136,011 | |
Goodwill acquired through acquisitions | 0 | 1,471,000 | |
Merrison subsumed into Corvus | 780,730 | ||
Goodwill impairment loss | (4,429,000) | ||
Balance – ending of period | 1,958,741 | 6,387,741 | 4,136,011 |
SSI | |||
Goodwill [Roll Forward] | |||
Balance – beginning of period | 8,461,150 | 8,461,150 | |
Goodwill acquired through acquisitions | 2,102,037 | 0 | |
Merrison subsumed into Corvus | 0 | ||
Goodwill impairment loss | (1,845,094) | ||
Balance – ending of period | 8,718,093 | 8,461,150 | 8,461,150 |
MFSI | |||
Goodwill [Roll Forward] | |||
Balance – beginning of period | 685,073 | 685,073 | |
Goodwill acquired through acquisitions | 0 | 0 | |
Merrison subsumed into Corvus | 0 | ||
Goodwill impairment loss | (645,000) | ||
Balance – ending of period | 40,073 | 685,073 | 685,073 |
Merrison | |||
Goodwill [Roll Forward] | |||
Balance – beginning of period | 0 | 780,730 | |
Goodwill acquired through acquisitions | 0 | 0 | |
Merrison subsumed into Corvus | (780,730) | ||
Goodwill impairment loss | 0 | ||
Balance – ending of period | $ 0 | $ 0 | $ 780,730 |
Convertible Promissory Notes _3
Convertible Promissory Notes - Related Party - Schedule of Convertible Promissory Notes, Related party (Detail) - Convertible note payable to related party - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Debt instrument, convertible, conversion price | $ 0.260 | $ 0.260 |
Interest rate | 5% | 5% |
Total convertible notes payable – related parties | $ 3,209,617 | $ 3,209,617 |
Less: Debt discount | (971,405) | (2,210,187) |
Total | $ 2,238,212 | $ 999,430 |
Convertible Promissory Notes _4
Convertible Promissory Notes - Related Party - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Apr. 04, 2022 | Oct. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Feb. 01, 2021 | |
Debt Instrument [Line Items] | ||||||
Interest expense | $ 1,399,262 | $ 1,535,840 | ||||
Repayments of convertible debt | 0 | $ 500,000 | $ 70,000 | |||
Crom | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of convertible debt | $ 500,000 | |||||
Convertible note payable to related party | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 5% | 5% | ||||
Debt instrument, convertible, conversion price | $ 0.260 | $ 0.260 | ||||
Debt instrument gross | $ 3,209,617 | $ 3,209,617 | ||||
Convertible note payable to related party | Buckhout Charitable Remainder Trust | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument gross | $ 3,209,617 | |||||
Convertible note payable to related party | Conversion price 0.013 | Buckhout Charitable Remainder Trust | ||||||
Debt Instrument [Line Items] | ||||||
Promissory note, principal balance | $ 4,279,617 | |||||
Interest rate | 5% | |||||
Debt instrument, convertible, conversion price | $ 0.26 | |||||
Convertible note payable to related party | Conversion price 0.26 per share | Buckhout Charitable Remainder Trust | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of convertible debt | $ 500,000 | $ 500,000 | ||||
Debt instrument gross | 4,209,617 | |||||
Convertible note payable to related party | Convertible debt pursuant to debt amendment conversion price 0.26 per share | Buckhout Charitable Remainder Trust | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument gross | $ 3,709,617 | |||||
Debt instrument periodic payment terms balloon payment to be paid | $ 2,709,617 |
Convertible Promissory Notes _5
Convertible Promissory Notes - Related Party - Schedule of Convertible Promissory Notes, Related party (Parenthetical) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Apr. 04, 2022 | Oct. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||
Repayment of convertible debt | $ 0 | $ 500,000 | $ 70,000 | ||
Crom | |||||
Debt Instrument [Line Items] | |||||
Repayment of convertible debt | $ 500,000 | ||||
Convertible note payable to related party | Conversion price 0.26 per share | Buckhout Charitable Remainder Trust | |||||
Debt Instrument [Line Items] | |||||
Repayment of convertible debt | $ 500,000 | $ 500,000 | |||
Debt instrument gross | 4,209,617 | ||||
Convertible note payable to related party | Convertible debt pursuant to debt amendment conversion price 0.26 per share | Buckhout Charitable Remainder Trust | |||||
Debt Instrument [Line Items] | |||||
Debt instrument gross | $ 3,709,617 | ||||
Debt instrument periodic payment terms balloon payment to be paid | $ 2,709,617 |
Notes Payable - Schedule of Not
Notes Payable - Schedule of Notes Payable (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule Of Notes Payable [Line Items] | ||
Total Notes Payable | $ 8,221,764 | $ 9,214,236 |
Less: Debt Discount | (146,989) | (840,398) |
Total | 8,074,775 | 8,373,838 |
Promissory Note | Note Payable Maturing The Earlier Of September 30, 2024 Or Completion Of Equity Offering | ||
Schedule Of Notes Payable [Line Items] | ||
Total Notes Payable | 400,000 | 400,000 |
Promissory Note | Note Payable Maturing The Earlier Of September 30, 2024 Or Acceleration Of Obligations | ||
Schedule Of Notes Payable [Line Items] | ||
Total Notes Payable | 400,000 | 0 |
Convertible Notes Payable | Convertibles Maturing April 4, 2023 | ||
Schedule Of Notes Payable [Line Items] | ||
Total Notes Payable | 0 | 890,000 |
Convertible Notes Payable | Convertibles Maturing February 13, 2024 | ||
Schedule Of Notes Payable [Line Items] | ||
Total Notes Payable | 840,000 | 0 |
Term Note Payable | ||
Schedule Of Notes Payable [Line Items] | ||
Total Notes Payable | $ 981,764 | $ 2,324,236 |
Notes Payable - Schedule of N_2
Notes Payable - Schedule of Notes Payable Narrative (Detail) - USD ($) | 12 Months Ended | |||||
Feb. 13, 2023 | Dec. 31, 2023 | Apr. 06, 2023 | Dec. 31, 2022 | Apr. 04, 2022 | Feb. 28, 2022 | |
Debt Instrument [Line Items] | ||||||
Common stock, shares, issued (in shares) | 47,672,427 | 41,699,363 | ||||
Total Notes Payable | $ 8,221,764 | $ 9,214,236 | ||||
Number of securities covered by warrants or rights (in shares) | 1,080,717 | |||||
Exercise price of warrants or rights (in usd per share) | $ 1 | |||||
Convertible Notes, Warrants | ||||||
Debt Instrument [Line Items] | ||||||
Number of securities covered by warrants or rights (in shares) | 700,000 | |||||
Exercise price of warrants or rights (in usd per share) | $ 1.38 | |||||
Notes Payable | Note Payable Maturing September 30, 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 700% | |||||
Total Notes Payable | $ 5,600,000 | 5,600,000 | ||||
Promissory Note | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 1,000% | 12% | ||||
Common stock, shares, issued (in shares) | 15,000,000 | 125,000 | ||||
Promissory Note | Note Payable Maturing The Earlier Of September 30, 2024 Or Completion Of Equity Offering | ||||||
Debt Instrument [Line Items] | ||||||
Total Notes Payable | $ 400,000 | 400,000 | ||||
Promissory Note | Note Payable Maturing The Earlier Of September 30, 2024 Or Acceleration Of Obligations | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 1,200% | |||||
Total Notes Payable | $ 400,000 | 0 | ||||
Convertible Notes Payable | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 0 | $ 1,050,000 | ||||
Conversion of stock, shares issued (in shares) | 556,250 | |||||
Conversion of stock, amount issued | $ 300,000 | |||||
Convertible Notes Payable | Convertibles Maturing April 4, 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 700% | |||||
Debt instrument, convertible, conversion price | $ 1.60 | |||||
Total Notes Payable | $ 0 | 890,000 | ||||
Convertible Notes Payable | Convertibles Maturing February 13, 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 1,000% | |||||
Debt instrument, convertible, conversion price | $ 1.20 | |||||
Total Notes Payable | $ 840,000 | 0 | ||||
Convertible Notes Payable | Crom | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, term | 60 months | |||||
Convertible Notes Payable | Crom | Convbertibles Maturing February 13, 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 10% | |||||
Total Notes Payable | $ 840,000 | |||||
Term Note Payable | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, basis spread on variable rate | 300% | |||||
Total Notes Payable | $ 981,764 | $ 2,324,236 | ||||
Debt Instrument, Interest Rate, Effective Percentage | 850% | 625% | ||||
Promissory Note, Dated April 6, 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Total Notes Payable | $ 400,000 |
Notes Payable - Additional Info
Notes Payable - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Apr. 04, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | ||||
Interest expense, debt | $ 1,732,265 | $ 1,874,142 | $ 859,744 | |
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility maximum borrowing capacity | $ 950,000 | |||
Long-term line of credit | $ 625,025 | $ 300,025 | ||
Revolving Credit Facility | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 2.75% |
Notes Payable - Schedule of Rep
Notes Payable - Schedule of Repayment, Net of Discounts (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule Of Note Payable Repayment Schedule, Net Of Discounts [Line Items] | ||
Total | $ 8,221,764 | $ 9,214,236 |
Notes Payable And Convertible Notes Payable | ||
Schedule Of Note Payable Repayment Schedule, Net Of Discounts [Line Items] | ||
2024 | 2,221,764 | |
2025 | 0 | |
2026 | 6,000,000 | |
Total | $ 8,221,764 |
Note Payable - Related Party -
Note Payable - Related Party - Schedule Of Notes Payable To Related Party (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of notes payable to related party [Line Items] | ||
Total Notes Payable | $ 8,221,764 | $ 9,214,236 |
SSI | ||
Schedule of notes payable to related party [Line Items] | ||
Total Notes Payable | $ 400,000 | |
SSI | Related Party | ||
Schedule of notes payable to related party [Line Items] | ||
Total Notes Payable | $ 400,000 | |
Interest rate | 5% | 5% |
Note Payable - Related Party _2
Note Payable - Related Party - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of notes payable to related party [Line Items] | |||
Interest expense | $ 1,399,262 | $ 1,535,840 | |
Related Party | |||
Schedule of notes payable to related party [Line Items] | |||
Interest expense | $ 20,000 | $ 20,000 | $ 7,726 |
Amount Due To Seller - Addition
Amount Due To Seller - Additional Information (Detail) | 12 Months Ended | |||||||
Dec. 31, 2023 USD ($) | Jun. 30, 2023 USD ($) | Mar. 22, 2023 USD ($) | Jan. 23, 2023 USD ($) | Apr. 15, 2022 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | ||||||||
Due to seller | $ 350,000 | $ 350,000 | ||||||
Cash payment in asset purchase | 485,739 | $ 250,000 | $ 0 | |||||
Global Technology Management Resources, Inc | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration transferred | $ 1,250,000 | |||||||
Accounts receivable note | 156,847 | $ 156,847 | $ 206,587 | |||||
Consideration payable period | 4 months | |||||||
Capital deficiency | $ 49,740 | |||||||
Consideration transferred | 6,711,407 | |||||||
Cash payment in asset purchase | $ 470,233 | |||||||
Global Technology Management Resources, Inc | Related Party | ||||||||
Business Acquisition [Line Items] | ||||||||
Due to seller | 280,000 | |||||||
Interest rate | 5 | |||||||
Lexington Solutions Group | ||||||||
Business Acquisition [Line Items] | ||||||||
Consideration transferred | $ 3,176,003 | |||||||
Cash payment in asset purchase | 521,003 | |||||||
Working capital adjustment | 21,003 | |||||||
Lexington Solutions Group | Tranche One, Two And Three | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash payment in asset purchase | 780,000 | |||||||
Lexington Solutions Group | Tranche Two | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash payment in asset purchase | $ 280,000 | $ 250,000 | $ 521,003 |
Stockholders' Equity (Deficit_2
Stockholders' Equity (Deficit) - Additional Information (Detail) | 1 Months Ended | 12 Months Ended | |||||||
Oct. 17, 2022 $ / shares shares | Oct. 13, 2022 | Apr. 07, 2022 $ / shares shares | Jun. 30, 2019 shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) shares | Apr. 04, 2022 USD ($) shares | Nov. 09, 2021 shares | |
Class of Stock [Line Items] | |||||||||
Common stock, par value (in usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 | |||||||
Less: preferred stock dividends | $ | $ 118,152 | $ 100,516 | $ 12,290 | ||||||
Stock issued during period, value, new issues | $ | 533,750 | ||||||||
Obligation to issue common and preferred stock | $ | $ 255,940 | $ 0 | |||||||
Common stock, shares authorized (in shares) | 3,000,000,000 | 3,000,000,000 | |||||||
Common stock, shares, issued (in shares) | 47,672,427 | 41,699,363 | |||||||
Common stock, shares outstanding (in shares) | 47,672,427 | 41,699,363 | |||||||
Stock-based compensation – options | $ | $ 5,923,200 | $ 4,985,233 | $ 3,113,261 | ||||||
IPO | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 1,500,000 | ||||||||
Sale of stock, price per share (in usd per share) | $ / shares | $ 2 | ||||||||
IPO | CISD | |||||||||
Class of Stock [Line Items] | |||||||||
Stock split ratio | 0.05 | ||||||||
IPO | Company | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 1,350,000 | ||||||||
IPO | Stockholders | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 150,000 | ||||||||
Service Based Grants | |||||||||
Class of Stock [Line Items] | |||||||||
Stock based compensation expense | $ | 4,675,129 | 3,852,606 | |||||||
Performance Shares | |||||||||
Class of Stock [Line Items] | |||||||||
Stock based compensation expense | $ | $ 1,248,071 | $ 1,132,627 | |||||||
Stock Incentive Plan | |||||||||
Class of Stock [Line Items] | |||||||||
Stock-based compensation, shares authorized (in shares) | 522,265 | 2,500,000 | |||||||
Options | |||||||||
Class of Stock [Line Items] | |||||||||
Shares issued in exercise of stock options (in shares) | 0 | 15,000 | |||||||
Number of options granted (in shares) | 1,932,500 | 2,585,000 | |||||||
Options, grants in period, weighted average exercise price (in usd per share) | $ / shares | $ 1.48 | $ 3.45 | |||||||
Options, weighted average grant date fair value (in usd per share) | $ / shares | $ 1.10 | $ 3.34 | |||||||
Common Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 132,500 | ||||||||
Stock issued during period, value, new issues | $ | $ 13 | ||||||||
Shares issued in exercise of stock options (in shares) | 15,000 | 10,000 | |||||||
Stock issued during period, shares, reverse stock splits (in shares) | 1,231 | ||||||||
Common Stock | Public Offering | |||||||||
Class of Stock [Line Items] | |||||||||
Common stock, issued (in shares) | 15,375,000 | ||||||||
Additional Paid-In Capital | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, value, new issues | $ | $ 533,737 | ||||||||
Stock-based compensation – options | $ | $ 5,923,200 | $ 4,985,233 | $ 3,113,261 | ||||||
Series A Preferred | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | |||||||
Preferred stock par or stated value per share (in usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Preferred stock, shares issued (in shares) | 5,875,000 | 5,875,000 | |||||||
Preferred stock, shares outstanding (in shares) | 5,875,000 | 5,875,000 | |||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 2 | ||||||||
Preferred stock repurchase price per share | $ / shares | $ 1 | ||||||||
Less: preferred stock dividends | $ | $ 72,624 | ||||||||
Preferred stock, dividend rate, per dollar amount (in usd per share) | $ / shares | $ 0.0125 | ||||||||
Series A Preferred | Letter Agreement | Crom | |||||||||
Class of Stock [Line Items] | |||||||||
Common stock, shares subscribed but unissued | 1,750,000 | ||||||||
Common stock, value, subscriptions | $ | $ 455,000 | ||||||||
Series A Preferred | Former Officer | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares issued (in shares) | 5,875,000 | ||||||||
Series A Preferred | Previously Reported | |||||||||
Class of Stock [Line Items] | |||||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 20 | ||||||||
Series B Preferred | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | ||||||||
Preferred stock par or stated value per share (in usd per share) | $ / shares | $ 0.0001 | ||||||||
Preferred stock, shares issued (in shares) | 0 | 3,610,000 | |||||||
Preferred stock, shares outstanding (in shares) | 0 | 3,610,000 | |||||||
Series B Preferred | Preferred Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 3,610,000 | ||||||||
Series C Preferred | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | |||||||
Preferred stock par or stated value per share (in usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Preferred stock, shares issued (in shares) | 770,000 | 770,000 | |||||||
Preferred stock, shares outstanding (in shares) | 770,000 | 770,000 | |||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 0.625 | ||||||||
Preferred stock, dividend rate, per dollar amount (in usd per share) | $ / shares | $ 0.06 | ||||||||
Dividends, preferred stock, cash | $ | $ 45,528 | ||||||||
Series C Preferred | Preferred Stock Along With Common Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, value, new issues | $ | $ 150,000 | $ 620,000 | |||||||
Series C Preferred | Preferred Stock Along With Common Stock | 2021 Series C Preferred Shares Obligation | |||||||||
Class of Stock [Line Items] | |||||||||
Obligation to issue common and preferred stock | $ | $ 25,000 | ||||||||
Series C Preferred | Preferred Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 150,000 | 620,000 | |||||||
Conversion of stock, shares converted (in shares) | 620,000 | ||||||||
Series C Preferred | Preferred Stock | 2021 Series C Preferred Shares Obligation | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 25,000 | ||||||||
Series C Preferred | Common Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 1,240,000 | ||||||||
Conversion of stock, shares issued (in shares) | 62,000 | ||||||||
Series C Preferred | Common Stock | 2021 Series C Preferred Shares Obligation | |||||||||
Class of Stock [Line Items] | |||||||||
Stock issued during period, shares, new issues (in shares) | 2,500 | ||||||||
Common Stock | Series C Preferred Stock Subscription Agreements | |||||||||
Class of Stock [Line Items] | |||||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 0.1 |
Stockholders' Equity (Deficit_3
Stockholders' Equity (Deficit) - Schedule of warrants (Detail) - Warrant - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Number | ||
Beginning balance (in shares) | 5,678,836 | 3,161,568 |
Granted (in shares) | 1,765,862 | 2,517,268 |
Ending balance (in shares) | 7,444,698 | 5,678,836 |
Intrinsic value of warrants | $ 327,214 | $ 1,374,303 |
Weighted Average Remaining Contractual Life (Years) | 4 years 8 months 12 days | |
Weighted Average Exercise Price | ||
Beginning balance (in usd per share) | $ 1.84 | $ 1.60 |
Granted | 1.17 | 2.20 |
Ending balance (in usd per share) | $ 1.68 | $ 1.84 |
Stockholders' Equity (Deficit_4
Stockholders' Equity (Deficit) - Schedule of options (Detail) - Options - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number | |||
Beginning balance (in shares) | 6,425,000 | 4,594,688 | |
Granted (in shares) | 1,932,500 | 2,585,000 | |
Exercised (in shares) | 0 | (15,000) | |
Forfeited (in shares) | (114,063) | (739,688) | |
Ending balance (in shares) | 8,243,437 | 6,425,000 | 4,594,688 |
Vested and expected to vest (in shares) | 4,620,822 | ||
Weighted Average Exercise Price | |||
Beginning balance (in usd per share) | $ 2.69 | $ 2.09 | |
Granted | 1.48 | 3.45 | |
Exercised (in usd per share) | 0 | 0.80 | |
Forfeited (in usd per share) | 2 | 2.41 | |
Ending balance (in usd per share) | 2.41 | $ 2.69 | $ 2.09 |
Vested and expected to vest (in usd per share) | $ 2.44 | ||
Weighted-Average Remaining Contractual Term (in Years) | |||
Weighted Average Remaining Contractual Life (Years) | 4 years 11 months 23 days | 5 years 7 months 17 days | 6 years 2 months 15 days |
Weighted-average remaining contractual life, granted (in Years) | 6 years 2 months 8 days | 6 years 3 months | |
Weighted average remaining contractual life, vested and exercisable (in Years) | 4 years 8 months 12 days | ||
Weighted-Average Fair Value [Abstract] | |||
Beginning balance weighted-average fair value (in usd per share) | $ 4.26 | $ 3.72 | |
Options, weighted average grant date fair value (in usd per share) | 1.10 | 3.34 | |
Ending balance, weighted-average fair value (in usd per share) | 3.58 | $ 4.26 | $ 3.72 |
Vested and expected to vest, exercisable, weighted average grant date fair value (in usd per share) | $ 3.20 |
Stockholders' Equity (Deficit_5
Stockholders' Equity (Deficit) - Schedule of Stock Options, Valuation Assumptions (Detail) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Equity [Abstract] | ||
Expected term | 7 years | 7 years |
Expected volatility minimum | 16,161% | 13,500% |
Expected volatility maximum | 16,614% | 17,700% |
Expected dividend yield | 0% | 0% |
Risk-free interest rate minimum | 348% | |
Risk-free interest rate maximum | 389% | |
Risk-free interest rate | 0.10% |
Fair Value - Summary of Derivat
Fair Value - Summary of Derivative Liabilities and the Contingent Earn out Fall (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liabilities | $ 157,600 | $ 824,000 |
Contingent earnout | 812,000 | |
Total | $ 1,636,000 | |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Derivative liability | Derivative liability |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liabilities | $ 0 | $ 0 |
Contingent earnout | 0 | |
Total | 0 | |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liabilities | 0 | 0 |
Contingent earnout | 0 | |
Total | 0 | |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liabilities | $ 157,600 | 824,000 |
Contingent earnout | 812,000 | |
Total | $ 1,636,000 |
Fair Value - Summary of Deriv_2
Fair Value - Summary of Derivative liabilities (Detail) - USD ($) | 12 Months Ended | ||||
Apr. 04, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Feb. 13, 2023 | |
Derivative [Line Items] | |||||
Derivative liability | $ 157,600 | $ 824,000 | |||
Fair value of warrants (in shares) | $ (1,054,025) | 132,000 | $ 0 | ||
Number of securities covered by warrants or rights (in shares) | 1,080,717 | ||||
Convertible note | Prior Crom Convertible Note | |||||
Derivative [Line Items] | |||||
Derivative liability | 314,000 | $ 0 | 191,000 | ||
Convertible note | Crom Cortana Fund LLC | |||||
Derivative [Line Items] | |||||
Derivative liability | 162,000 | 200 | 0 | ||
Warrants | |||||
Derivative [Line Items] | |||||
Fair value of warrants (in shares) | 656,250 | ||||
Warrants | Convertibles Maturing April 4, 2023 | |||||
Derivative [Line Items] | |||||
Derivative liability | 378,000 | 66,000 | 633,000 | ||
Warrants | Convertibles Maturing February 13, 2024 | |||||
Derivative [Line Items] | |||||
Derivative liability | $ 259,000 | $ 91,400 | $ 0 | ||
Number of securities covered by warrants or rights (in shares) | 700,000 |
Fair Value - Additional Informa
Fair Value - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |||
Change in fair value of derivative liabilities | $ 666,400 | $ 824,000 | $ 0 |
Fair Value - Summary of Change
Fair Value - Summary of Change in the Fair Value of the Derivative Liabilities (Detail) | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance as of December 31, 2022 | $ (824,000) |
Issuance of Derivative Liabilities | (421,000) |
Change in fair value of Derivative Liabilities | 1,087,400 |
Ending balance as of December 31, 2023 | $ (157,600) |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Fair Value Adjustment of Warrants |
Fair Value - Summary of Fair Va
Fair Value - Summary of Fair Value Measurements (Detail) | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2022 Rate | Dec. 31, 2023 $ / shares Rate | Apr. 04, 2022 $ / shares | |
Minimum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Debt instrument, term | 3 months 3 days | 1 month 13 days | |
Maximum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Debt instrument, term | 4 years 3 months 3 days | 4 years 1 month 6 days | |
Stock Price | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 0.30 | 1.26 | |
Conversion option - convertible note | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 1.20 | 1.60 | |
Strike price - warrants | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 1.84 | ||
Strike price - warrants | Minimum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 1.38 | ||
Strike price - warrants | Maximum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 1.84 | ||
Volatility | Minimum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 98 | 121 | |
Volatility | Maximum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 148.30 | 156.50 | |
Market yield - conversion option | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | 0.1740 | 0.1030 | |
Risk-free rate | Minimum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | Rate | 4.10 | 3.90 | |
Risk-free rate | Maximum | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liability, measurement input | Rate | 4.40 | 5.60 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||||
Apr. 30, 2022 officer | Nov. 30, 2021 officer | Aug. 31, 2021 officer | Jun. 30, 2021 USD ($) shares | Jan. 31, 2021 officer | Dec. 31, 2022 USD ($) | |
Related Party Transaction [Line Items] | ||||||
Number of officers | officer | 2 | 2 | 2 | 2 | ||
Chief Growth Officer | Series C Preferred | ||||||
Related Party Transaction [Line Items] | ||||||
Stock issued during period, value, issued for services | $ | $ 220,000 | |||||
Stock issued during period, shares, Issued for services (in shares) | shares | 220,000 | |||||
Chief Growth Officer | Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Stock issued during period, shares, Issued for services (in shares) | shares | 440,000 | |||||
Director | ||||||
Related Party Transaction [Line Items] | ||||||
Debt instrument, repaid, principal | $ | $ 1,000,000 |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Employer match | $ 882,707 | $ 651,353 | $ 434,267 |
Commitments - Additional Inform
Commitments - Additional Information (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||
Mar. 22, 2023 USD ($) shares | Apr. 25, 2022 USD ($) | Aug. 12, 2021 shares | Aug. 05, 2021 USD ($) shares | Jul. 01, 2021 USD ($) shares | Apr. 01, 2020 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 $ / shares shares | |
Other Commitments [Line Items] | ||||||||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 1 | |||||||
Options | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options granted (in shares) | shares | 1,932,500 | 2,585,000 | ||||||
Options, grants in period, weighted average exercise price (in usd per share) | $ / shares | $ 1.48 | $ 3.45 | ||||||
Minimum | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, general term | 3 years | |||||||
Maximum | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, general term | 4 years | |||||||
David Bell,Chief Financial Officer | Warrant | ||||||||
Other Commitments [Line Items] | ||||||||
Bonus warrants (in shares) | shares | 500,000 | |||||||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 2 | |||||||
David Bell,Chief Financial Officer | Warrant | Upon the Company Joining the Russell 3000 Andor Russell 2000 stock index(ices) | ||||||||
Other Commitments [Line Items] | ||||||||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 2.40 | |||||||
David Bell,Chief Financial Officer | Deferred Bonus | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash award granted, amount | $ 50 | |||||||
David Bell,Chief Financial Officer | Deferred Bonus | Upon the Company Joining the Russell 3000 Andor Russell 2000 stock index(ices) | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash award granted, amount | $ 100 | |||||||
Bonus warrants (in shares) | shares | 750,000 | |||||||
David Bell,Chief Financial Officer | Less Than 35,000 Per Month | ||||||||
Other Commitments [Line Items] | ||||||||
Annual base salary | $ 35 | |||||||
David Bell,Chief Financial Officer | Less Than 35,000 Per Month | Bell Performance Bonus | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash awards granted, percentage | 50% | |||||||
David Bell,Chief Financial Officer | 35,000 to Less Than 40,000 Per Month | Bell Performance Bonus | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash awards granted, percentage | 60% | |||||||
David Bell,Chief Financial Officer | 40,000 or More Per Month | ||||||||
Other Commitments [Line Items] | ||||||||
Annual base salary | $ 40 | |||||||
David Bell,Chief Financial Officer | 40,000 or More Per Month | Bell Performance Bonus | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash awards granted, percentage | 100% | |||||||
David Bell,Chief Financial Officer | Minimum | 35,000 to Less Than 40,000 Per Month | ||||||||
Other Commitments [Line Items] | ||||||||
Annual base salary | $ 35 | |||||||
David Bell,Chief Financial Officer | Maximum | 35,000 to Less Than 40,000 Per Month | ||||||||
Other Commitments [Line Items] | ||||||||
Annual base salary | $ 40 | |||||||
Employment Agreement | Management Personnel One | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options received by personnel as per agreement (in shares) | shares | 300,000 | |||||||
Employment Agreement | Management Personnel Two | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options received by personnel as per agreement (in shares) | shares | 300,000 | |||||||
Employment Agreement | Management Personnel Three | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options received by personnel as per agreement (in shares) | shares | 300,000 | |||||||
Employment Agreement | Warrant | Commencing Trading On Tier Of NASDAQ OR NYSE | ||||||||
Other Commitments [Line Items] | ||||||||
Bonus warrants (in shares) | shares | 500,000 | |||||||
Strike price (in usd per share) | $ / shares | $ 2 | |||||||
Employment Agreement | Warrant | After Joining Russel 3000 and Russel 2000 Stock Indices | ||||||||
Other Commitments [Line Items] | ||||||||
Bonus warrants (in shares) | shares | 1,250,000 | |||||||
Strike price (in usd per share) | $ / shares | $ 2.40 | |||||||
Employment Agreement | Deferred Bonus | Commencing Trading On Tier Of NASDAQ OR NYSE | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash award granted, amount | $ 50 | |||||||
Employment Agreement | Deferred Bonus | After Joining Russel 3000 and Russel 2000 Stock Indices | ||||||||
Other Commitments [Line Items] | ||||||||
Deferred compensation arrangement with individual, cash award granted, amount | 125 | |||||||
Employment Agreement | Upon Reaching An Annualized Revenue Run Rate Of 25,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Revenue run rate | 25,000 | |||||||
Employment Agreement | Upon Achieving An Annualized Revenue Run Rate Of 75,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Revenue run rate | 75,000 | |||||||
Employment Agreement | Upon Reaching An Annualized Revenue Of $50,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Revenue run rate | $ 50,000 | |||||||
Employment Agreement | David Bell,Chief Financial Officer | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options granted (in shares) | shares | 1,800,000 | |||||||
Annual base salary | $ 275 | |||||||
Vesting period | 36 months | |||||||
Number of days within which advance notice for intent not to renew has to be provided | 90 days | |||||||
Options, grants in period, weighted average exercise price (in usd per share) | $ / shares | $ 3.80 | |||||||
Employment Agreement | David Bell,Chief Financial Officer | Upon Achieving An Annualized Revenue Run Rate Of 50,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | $ 25 | |||||||
Revenue run rate | 50,000 | |||||||
Employment Agreement | David Bell,Chief Financial Officer | Upon Achieving An Annualized Revenue Run Rate Of 75,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 35 | |||||||
Revenue run rate | 75,000 | |||||||
Employment Agreement | David Bell,Chief Financial Officer | Upon Reaching an Annualized Revenue Run Rate of 150,000,000 or greater and EBITDA Margin of No Less Than 7 | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 40 | |||||||
Revenue run rate | $ 150,000 | |||||||
EBITDA margin | 0.07 | |||||||
Employment Agreement | David Bell,Chief Financial Officer | Upon Reaching an Annualized Revenue Run Rate of 300,000,000 or Greater and Adjusted EBITDA Margin of No Less Than 8 | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | $ 45 | |||||||
Revenue run rate | $ 300,000 | |||||||
EBITDA margin | 0.08 | |||||||
Employment Agreement | Mark Fuller and Jay Wright | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, term | 3 years | |||||||
Percentage of the trailing twelve months revenues of each company acquired during the term of the agreement paid as cash bonus | 1% | |||||||
Percentage of the trailing twelve month EBITDA of each business acquired during the term of the employment agreement paid as cash bonus | 4% | |||||||
Warrants and rights outstanding, term | 7 years | |||||||
Employment Agreement | Mark Fuller | ||||||||
Other Commitments [Line Items] | ||||||||
Annual base salary | $ 240 | |||||||
Number of warrant issued for each dollar amount of revenue acquired in any acquisition | shares | 1 | |||||||
Employment Agreement | Mark Fuller | Upon Reaching An Annualized Revenue Run Rate Of 25,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | $ 25 | |||||||
Employment Agreement | Mark Fuller | Upon Achieving An Annualized Revenue Run Rate Of 75,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 40 | |||||||
Employment Agreement | Mark Fuller | Upon Reaching An Annualized Revenue Of $50,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 30 | |||||||
Employment Agreement | Jay Wright | ||||||||
Other Commitments [Line Items] | ||||||||
Annual base salary | $ 240 | |||||||
Number of warrant issued for each dollar amount of revenue acquired in any acquisition | shares | 1 | |||||||
Employment Agreement | Jay Wright | Upon Reaching An Annualized Revenue Run Rate Of 25,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | $ 25 | |||||||
Employment Agreement | Jay Wright | Upon Achieving An Annualized Revenue Run Rate Of 75,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 40 | |||||||
Employment Agreement | Jay Wright | Upon Reaching An Annualized Revenue Of $50,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | $ 30 | |||||||
Employment Agreement | Chief Growth Officer | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, term | 4 years | |||||||
Annual base salary | $ 250 | |||||||
Employment Agreement | Chief Growth Officer | Options | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options granted (in shares) | shares | 1,500,000 | |||||||
Employment Agreement | Chief Growth Officer | Time Based Options | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options granted (in shares) | shares | 750,000 | |||||||
Vesting period | 4 years | |||||||
Employment Agreement | Chief Growth Officer | Performance Based Options | ||||||||
Other Commitments [Line Items] | ||||||||
Number of options granted (in shares) | shares | 750,000 | |||||||
Number of options grants upon closing of acquisition (in shares) | shares | 250,000 | |||||||
Annualized Revenue Required to grant options upon clsoing of acquisition | $ 12,000 | |||||||
Number of options grant upon achieving the revenue and ebitda amounts (in shares) | shares | 250,000 | |||||||
Achievement of revenue required to grant options | $ 25,000 | |||||||
EBITDA required to grant options in any twelve month period | $ 2,500 | |||||||
Number of options grant upon overall achievement of revenue run rate based on quarterly performance (in shares) | shares | 250,000 | |||||||
Achievement of revenue run rate based on quarterly performance to grant options | $ 100,000 | |||||||
Achievement of revenue run rate in any calendar quarter to grant options | 25,000 | |||||||
Employment Agreement | Chief Growth Officer | Navy Division Reaching An Annualized Revenue Run Rate Of 25,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 25 | |||||||
Revenue run rate | 25,000 | |||||||
Employment Agreement | Chief Growth Officer | Navy Division Reaching An Annualized Revenue Run Rate Of 60,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 30 | |||||||
Revenue run rate | 60,000 | |||||||
Employment Agreement | Chief Growth Officer | Navy Division Reaching An Annualized Revenue Run Rate Of 100,000,000 Or Greater | ||||||||
Other Commitments [Line Items] | ||||||||
Per month increase in annual base salary committed | 40 | |||||||
Revenue run rate | $ 100,000 | |||||||
Employment Agreement | Former Executive Of Merrison | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, term | 3 years | |||||||
Annual base salary | $ 220 | |||||||
As per agreement, number of stock options entitled to receive (in shares) | shares | 150,000 | |||||||
Bonus payable annually as per agreement | $ 80 | |||||||
Annualized net income required to maintain for one year period ending on applicable date to eligible of bonus | $ 500 | |||||||
Employment Agreement | Two Executives Of SSI As Well As Three Management Personnel | Management Personnel Three | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, term | 3 years | |||||||
Employment Agreement | Chief Executive Officer | ||||||||
Other Commitments [Line Items] | ||||||||
Employment agreements, term | 3 years | |||||||
Annual base salary | $ 200 | |||||||
As per agreement, number of stock options entitled to receive (in shares) | shares | 300,000 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Federal income taxes at statutory rate | 21% | 21% | 21% |
State income taxes at statutory rate | 2.20% | 3.50% | 7.61% |
Change in tax rate | (0.80%) | (2.90%) | (1.58%) |
Permanent differences | (3.60%) | (7.70%) | (0.98%) |
Other | 0.50% | (1.70%) | (0.04%) |
Goodwill impairment | (6.30%) | 0% | 0% |
Change in valuation allowance | (6.40%) | (17.90%) | 0% |
Totals | 6.60% | (5.70%) | 26.01% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | |||
Deferred interest | $ 698,231 | $ 0 | $ 0 |
Lease liabilities | 160,042 | 8,973 | 0 |
Accrued expenses | 352,346 | 148,776 | 95,673 |
Stock compensation | 3,530,993 | 3,008,318 | 2,358,218 |
Transaction costs | 44,665 | 41,817 | 53,881 |
Other | 160 | 149,153 | 2,407 |
Total deferred tax assets | 4,786,437 | 3,357,037 | 2,510,179 |
Deferred tax liabilities: | |||
Intangible assets | (1,348,275) | (939,607) | (1,334,460) |
ROU Assets | (156,788) | (9,052) | 0 |
Property and equipment | (55,164) | (8,569) | (14,312) |
Debt discount | (256,788) | (741,579) | (400,064) |
Cash to accrual method change | (136,667) | (43,443) | (151,310) |
Total deferred tax liabilities | (1,953,682) | (1,742,250) | (1,900,146) |
Valuation allowance | (2,839,047) | (1,614,787) | 0 |
Net deferred tax assets (liabilities) | $ (6,292) | ||
Net deferred tax assets (liabilities) | $ 0 | $ 610,033 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Accrued interest and penalties | $ 0 | $ 0 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components Of Income Tax Expense (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Current | $ 223,049 | $ 209,563 | $ 238,928 |
Deferred tax provision | (1,480,166) | 610,033 | (2,895,571) |
Total | $ (1,257,117) | $ 819,596 | $ (2,656,643) |
Subsequent Events (Details)
Subsequent Events (Details) | 1 Months Ended | |||||||||||||||||
Mar. 12, 2024 officer | Feb. 22, 2024 USD ($) | Feb. 16, 2024 USD ($) | Feb. 15, 2024 USD ($) | Feb. 13, 2024 USD ($) | Jan. 25, 2024 USD ($) $ / shares shares | Apr. 04, 2022 USD ($) | Apr. 30, 2022 officer | Nov. 30, 2021 officer | Aug. 31, 2021 officer | Jan. 31, 2021 officer | Aug. 31, 2026 | Jan. 01, 2026 | Jan. 01, 2025 | Dec. 31, 2023 USD ($) $ / shares shares | Apr. 06, 2023 | Dec. 31, 2022 USD ($) | Aug. 12, 2021 USD ($) | |
Subsequent Event [Line Items] | ||||||||||||||||||
Number of securities covered by warrants or rights (in shares) | shares | 1,080,717 | |||||||||||||||||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 1 | |||||||||||||||||
Contingent earnout | $ 380,000 | $ 812,000 | ||||||||||||||||
Contingent earnout, net of current portion | $ 340,000 | $ 0 | ||||||||||||||||
Number of officers | officer | 2 | 2 | 2 | 2 | ||||||||||||||
Eisiminger Note | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Interest rate | 7.50% | |||||||||||||||||
Convertible note payable to related party | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Debt instrument gross | $ 3,209,617 | |||||||||||||||||
Notes Payable Due Two Thousand And Twenty Six | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Promissory note, principal balance | $ 2,400,000 | |||||||||||||||||
Revolving Credit Facility | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Revolving credit facility maximum borrowing capacity | $ 950,000 | |||||||||||||||||
Revolving Credit Facility | Prime Rate | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.75% | |||||||||||||||||
Note payable | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Promissory note, principal balance | $ 400,000 | |||||||||||||||||
Notes Payable | Note Payable Maturing September 30, 2024 | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Interest rate | 700% | |||||||||||||||||
Promissory Note | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Interest rate | 1,000% | 12% | ||||||||||||||||
Subsequent Event | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Sale of stock, price per share (in usd per share) | $ / shares | $ 0.32 | |||||||||||||||||
Agency fee, percentage | 0.070 | |||||||||||||||||
Earnout settlement | $ 720,000 | |||||||||||||||||
Initial payment | 180,000 | |||||||||||||||||
Payment amount | $ 20,000 | |||||||||||||||||
Interest percent | 0.05 | |||||||||||||||||
Term of earnout | 27 months | |||||||||||||||||
Number of officers | officer | 2 | |||||||||||||||||
Subsequent Event | Eisiminger Note | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Interest rate | 8% | |||||||||||||||||
Debt instrument, repaid, principal | $ 400,000 | |||||||||||||||||
Subsequent Event | Buckhout Charitable Remainder Trust | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Debt instrument, repaid, principal | 809,617 | |||||||||||||||||
Subsequent Event | Notes Payable Due Two Thousand And Twenty Six | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Interest rate | 12% | 8% | 5% | |||||||||||||||
Promissory note, monthly principal | 100,000 | |||||||||||||||||
Subsequent Event | Revolving Credit Facility | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Revolving credit facility maximum borrowing capacity | 4,000,000 | |||||||||||||||||
Amount rolled over | $ 625,000 | |||||||||||||||||
Subsequent Event | Revolving Credit Facility | Prime Rate | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Debt instrument, basis spread on variable rate | 2% | |||||||||||||||||
Subsequent Event | Convertible Notes Payable | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Number of securities covered by warrants or rights (in shares) | shares | 3,193,534 | |||||||||||||||||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 0.319 | |||||||||||||||||
Subsequent Event | Convertible Notes Payable | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Warrants issued | shares | 3,193,534 | |||||||||||||||||
Partial conversion of note payable | $ 847,000 | |||||||||||||||||
Subsequent Event | Note payable | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Periodic payment | $ 50,000 | |||||||||||||||||
Debt instrument, repaid, principal | $ 1,209,617 | |||||||||||||||||
Subsequent Event | Notes Payable | Note Payable Maturing September 30, 2024 | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Promissory note, principal balance | 5,600,000 | |||||||||||||||||
Subsequent Event | Promissory Note | Note Payable Maturing The Earlier Of September 30, 2024 Or Completion Of Equity Offering | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Promissory note, principal balance | $ 400,000 | |||||||||||||||||
Subsequent Event | SPA Agreement | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Common stock, issued (in shares) | shares | 5,243,967 | |||||||||||||||||
Consideration received on transaction | $ 2,700,000 | |||||||||||||||||
Subsequent Event | Private Placement | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Out of pocket expenses | $ 60,000 | |||||||||||||||||
Subsequent Event | Private Placement | Convertible Notes Payable | ||||||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||||||
Number of securities covered by warrants or rights (in shares) | shares | 8,437,501 | |||||||||||||||||
Exercise price of warrants or rights (in usd per share) | $ / shares | $ 0.35 | |||||||||||||||||
Warrants and rights outstanding, term | 5 years |
Uncategorized Items - ctm-20231
Label | Element | Value |
Revision of Prior Period, Error Correction, Adjustment [Member] | ||
Prior Period Reclassification Adjustment | us-gaap_PriorPeriodReclassificationAdjustment | $ (274,500) |
Retained Earnings [Member] | Revision of Prior Period, Error Correction, Adjustment [Member] | ||
Prior Period Reclassification Adjustment | us-gaap_PriorPeriodReclassificationAdjustment | 30,000 |
Additional Paid-in Capital [Member] | Revision of Prior Period, Error Correction, Adjustment [Member] | ||
Prior Period Reclassification Adjustment | us-gaap_PriorPeriodReclassificationAdjustment | $ (304,500) |