Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 13, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | OMNIQ Corp. | |
Entity Central Index Key | 0000278165 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 4,886,923 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 2,569 | $ 4,594 |
Accounts receivable, net | 11,428 | 9,661 |
Inventory | 2,347 | 1,507 |
Prepaid expenses | 634 | 670 |
Other current assets | 12 | 10 |
Total current assets | 17,090 | 16,442 |
Property and equipment, net of accumulated depreciation of $642 and $600, respectively | 248 | 289 |
Goodwill | 14,695 | 14,695 |
Trade name, net of accumulated amortization of $3,464 and $3,362, respectively | 927 | 1,028 |
Customer relationships, net of accumulated amortization of $8,456 and $8,111, respectively | 4,133 | 4,479 |
Other intangibles, net of accumulated amortization of $415 and $382, respectively | 1,008 | 1,042 |
Restricted Cash | 533 | |
Right of use lease asset | 69 | 76 |
Other assets | 42 | 74 |
Total assets | 38,212 | 38,658 |
Current liabilities | ||
Accounts payable and accrued liabilities | 34,074 | 26,811 |
Line of credit | 4,914 | |
Accrued payroll and sales tax | 1,364 | 1,717 |
Notes payable, related parties - current portion | 390 | 433 |
Notes payable - current portion | 6,449 | 6,449 |
Lease liability - current portion | 32 | 31 |
Other current liabilities | 1,380 | 1,412 |
Total current liabilities | 43,689 | 41,767 |
Long term liabilities | ||
Notes payable, related party, less current portion | 585 | 683 |
Accrued interest and accrued liabilities, related party | 59 | 56 |
Notes payable, less current portion | 1 | |
Lease liability | 40 | 48 |
Other long-term liabilities | 1,178 | 1,146 |
Total liabilities | 45,551 | 43,701 |
Stockholders' equity (deficit) | ||
Preferred stock, value | ||
Common stock; $0.001 par value; 15,000,000 shares authorized; 4,716,218 and 4,684,736 shares issued and outstanding, respectively. | 5 | 5 |
Additional paid-in capital | 52,819 | 51,842 |
Accumulated (deficit) | (60,104) | (56,726) |
Accumulated other comprehensive loss | (61) | (166) |
Total stockholders' equity (deficit) | (7,339) | (5,043) |
Total liabilities and stockholders' equity (deficit) | 38,212 | 38,658 |
Series A Preferred Stock [Member] | ||
Stockholders' equity (deficit) | ||
Preferred stock, value | ||
Series B Preferred Stock [Member] | ||
Stockholders' equity (deficit) | ||
Preferred stock, value | ||
Series C Preferred Stock [Member] | ||
Stockholders' equity (deficit) | ||
Preferred stock, value | 2 | 2 |
Total stockholders' equity (deficit) | $ 2 | $ 2 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accumulated depreciation of fixed assets | $ 642 | $ 600 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 15,000,000 | 15,000,000 |
Common stock, shares issued | 4,716,218 | 4,684,736 |
Common stock, shares outstanding | 4,716,218 | 4,684,736 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares designated | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares designated | 1 | 1 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Series C Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares designated | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 2,145,030 | 2,145,030 |
Preferred stock, shares outstanding | 2,145,030 | 2,145,030 |
Trade Names [Member] | ||
Accumulated amortization | $ 3,464 | $ 3,362 |
Customer Relationships [Member] | ||
Accumulated amortization | 8,456 | 8,111 |
Other Intangible Assets [Member] | ||
Accumulated amortization | $ 415 | $ 382 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues | ||
Total Revenues | $ 19,751 | $ 13,799 |
Cost of goods sold | ||
Cost of goods sold | 17,115 | 10,763 |
Gross profit | 2,636 | 3,036 |
Operating expenses | ||
Research and development | 494 | 386 |
Selling, general and administrative | 4,438 | 4,137 |
Depreciation | 43 | 47 |
Amortization | 525 | 502 |
Total operating expenses | 5,500 | 5,072 |
Income (loss) from operations | (2,864) | (2,036) |
Other income (expenses): | ||
Interest expense | (589) | (795) |
Other (expenses) income | 110 | (42) |
Total other expenses | (479) | (837) |
Net loss before Income Taxes | (3,343) | (2,873) |
Provision for Income Taxes | ||
Current | ||
Total Provision for Income Taxes | ||
Net loss attributable to OMNIQ Corp. | (3,343) | (2,873) |
Less: Preferred stock - Series C dividend | (31) | (72) |
Net loss attributable to the common stockholders | (3,374) | (2,945) |
Foreign currency translation adjustment | 105 | |
Other comprehensive income (loss) | $ (3,269) | $ (2,945) |
Net loss per share - basic | $ (0.70) | $ (0.74) |
Net loss per share from continuing operations - basic | $ (0.70) | $ (0.74) |
Weighted average number of common shares outstanding - basic | 4,700,737 | 3,984,006 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Series C Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Shares Repurchased [Member] | Accumulated Deficit [Member] | Other Comprehensive Income (Loss) [Member] | Total |
Beginning balance at Dec. 31, 2019 | $ 5 | $ 4 | $ 46,861 | $ (45,063) | $ 1 | $ 1,808 | |
Beginning balance, shares at Dec. 31, 2019 | 4,829 | 3,960 | |||||
Dividend on Class C Shares | (72) | (72) | |||||
Accumulated other comprehensive loss | (17) | (17) | |||||
Stock-based compensation - options and warrants | 190 | 190 | |||||
Subscribed common stock | 440 | 440 | |||||
Professional fees - restricted shares | 354 | 354 | |||||
Professional fees - restricted shares, shares | 65 | ||||||
Other misc. items | 14 | 14 | |||||
Net (loss) income | (2,873) | (2,873) | |||||
Ending balance at Mar. 31, 2020 | $ 5 | $ 4 | 47,845 | (47,994) | (16) | (156) | |
Ending balance, shares at Mar. 31, 2020 | 4,829 | 4,025 | |||||
Beginning balance at Dec. 31, 2020 | $ 2 | $ 5 | 51,842 | (56,726) | (166) | (5,043) | |
Beginning balance, shares at Dec. 31, 2020 | 2,145 | 4,685 | |||||
Dividend on Class C Shares | (31) | (31) | |||||
Other misc. items | (4) | (4) | |||||
ESPP Stock Issuance | 1 | 1 | |||||
Stock-based compensation - options, warrants, issuances | 786 | 786 | |||||
Stock and Warrant issued for services | 188 | $ 188 | |||||
Stock and Warrant issued for services, shares | 25 | ||||||
Exercise of stock options and warrants | 2 | $ 2 | |||||
Exercise of stock options and warrants, shares | 6 | ||||||
Cumulative translation adjustment | 105 | 105 | |||||
Net (loss) income | (3,343) | (3,343) | |||||
Ending balance at Mar. 31, 2021 | $ 2 | $ 5 | $ 52,819 | $ 0 | $ (60,104) | $ (61) | $ (7,339) |
Ending balance, shares at Mar. 31, 2021 | 2,145 | 4,716 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from continuing operating activities: | ||
Net loss | $ (3,343) | $ (2,873) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Stock based compensation | 974 | 544 |
Amortization of ROU lease asset | 7 | 13 |
Depreciation and amortization | 568 | 548 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,767) | (6,006) |
Prepaid expenses | 36 | (310) |
Inventory | (840) | 121 |
Accounts payable and accrued liabilities | 7,266 | 6,186 |
Accrued interest and accrued liabilities, related party | 3 | |
Accrued payroll and sales taxes payable | (353) | 731 |
Other assets | 54 | |
Lease liability | (7) | (12) |
Other liabilities | (32) | (531) |
Net cash (used in) provided by operating activities | 2,509 | (1,532) |
Cash flows from investing activities: | ||
Other assets | 565 | 24 |
Purchase of property and equipment | (2) | (1) |
Net cash provided by investing activities | 563 | 15 |
Cash flows from financing activities: | ||
Proceeds from ESPP stock issuance | 1 | |
Proceeds from / (payments on) line of credit | (4,914) | 3,613 |
Payment on notes/loans payable | (142) | (390) |
Net cash provided by (used in) financing activities | (5,055) | 3,223 |
Net increase (decrease) in cash | (1,983) | 1,706 |
Foreign currency translation adjustment | 58 | |
Cash, beginning of period | 4,594 | 1,615 |
Cash, end of period | 2,669 | 3,321 |
Cash paid for interest | 585 | 601 |
Cash paid for taxes | ||
Supplementary for non-cash flow information: | ||
Stock issued for services | 188 | 354 |
Intangible assets acquired in non-cash exchange | 885 | |
Stock options and warrants issued | $ 190 |
Nature of Operations
Nature of Operations | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | NOTE 1 – NATURE OF OPERATIONS OMNIQ Corp., a Delaware corporation, formerly Quest Solution, Inc., together with its wholly owned subsidiaries, referred to herein as “we,” “us,” and “our” (“OMNIQ” or the “Company”), was incorporated in 1973. Since its incorporation, the Company has been involved in various lines of business. From 2008 and to 2013, we were in the business of developing oil and gas reserves. In January 2014, we determined it was in the best interest of our stockholders to focus on operating companies with a track record of positive cash flows and larger existing revenue bases. Our strategy developed into leveraging management’s relationships in the business world for investments for the Company. Since 2014, we have made the following acquisitions resulting in us becoming a leading provider of computerized and machine vision image processing solutions: ● Quest Solutions, Inc. (January 2014) ● Bar Code Specialties, Inc. (November 2014) ● ViascanQdata, Inc (October 2015 – later sold in September 2016) ● HTS Image Processing, Inc. (October 2018) ● EyepaxIT Consulting LLC. (February 2021) We use patented and proprietary artificial intelligence (AI) technology to deliver data collection, real time surveillance and monitoring for supply chain management, homeland security, public safety, traffic & parking management and access control applications. The technology and services we provide helps our clients move people, assets and data safely and securely through airports, warehouses, schools, national borders, and many other applications and environments. We offer end-to-end solutions that include hardware, software, communications, and full lifecycle management services. We are an established manufacturer and distributor of barcode labels, tags, and ribbons, as well as RFID labels and tags. Our highly tenured team of professionals has the knowledge and expertise to simplify the integration process for our customers, and our team delivers proven problem-solving solutions backed by numerous customer references. We offer comprehensive packaged and configurable software and we are a leading provider of best-in-class mobile and wireless equipment. Our customers include government agencies and leading Fortune 500 companies from diverse sectors, including healthcare, food and beverage, manufacturing, retail, distribution, transportation and logistics, and oil, gas, and chemicals. COVID-19 The outbreak of the COVID-19 pandemic continues to affect the United States of America and the world, including in the primary regions we operate. Many State Governors issued temporary Executive Orders in 2020, that, among other stipulations, effectively limited in-person work activities for most industries and businesses having the effect of suspending or severely curtailing operations. Many of these orders are in the process of being lifted. To date, we have not incurred any significant interruptions to our day-to-day operations or supply chain, except some of our employees have or are working remotely. In response to the COVID-19 pandemic, we proactively implemented certain measures to strengthen cash flow, manage costs, strengthen liquidity and enhance employee safety. These measures included the reduction of payroll costs, a reduction in capital expenditures and other discretionary spending, the elimination of most business travel and restriction of visitors to our corporate office, enhanced cleaning and disinfection procedures at our corporate office and branch locations, promotion of social distancing and the wearing of face coverings (masks) at our corporate office and branch locations, and requirements for employees to work from home where possible. The extent of the ultimate impact of the pandemic on our operational and financial performance will depend on various developments, including the duration and spread of the outbreak, the impact on capital and financial markets, governmental limitations on business operations generally, and its and their impact on potential customers, employees, vendors and distribution partners, all of which cannot be reasonably predicted at this time. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 –SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES We describe our significant accounting policies in Note 2 of the notes to consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2020. During the three-month period ended March 31, 2021, there were no significant changes to those accounting policies. Principles of Consolidation and Basis of Presentation Our unaudited condensed consolidated financial statements include the financial position and results of operations of OMNIQ Corp. and its wholly owned subsidiaries Quest Marketing, Inc., Quest Exchange Ltd., and HTS Image Processing, Inc., collectively referred to herein as “we” or “us” or “our” or the “Company.” All significant intercompany accounts and transactions have been eliminated in these unaudited condensed consolidated financial statements. Business combinations are included in the unaudited condensed consolidated financial statements from their respective dates of acquisition. We have prepared the interim unaudited condensed consolidated financial statements included herein, in accordance with accounting principles generally accepted in the United States of America, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although we believe the disclosures are adequate to make the information presented not misleading. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these interim financial statements be read in conjunction with our financial statements for the year ended December 31, 2020, and notes thereto included in our Form 10-K filed with the SEC on March 31, 2021. The Company operates in one segment. Operating results for the three months ended March 31, 2021, are not necessarily indicative of the results that may be expected for the year ended December 31, 2021. Use of Estimates We prepare our unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reported period. These assumptions and estimates could have a material effect on our unaudited condensed consolidated financial statements. Actual results may differ materially from those estimates. We review our estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. Goodwill and Intangibles We have made acquisitions in the past that resulted in the recognition of goodwill. Goodwill is the excess of the consideration transferred plus the fair value of any non-controlling interest in the acquiree at the acquisition date over the fair values of the identifiable net assets acquired. We evaluate goodwill for impairment annually or more frequently, if triggering events occur or other impairment indicators arise which might impair recoverability. Application of the goodwill impairment test requires judgment. We performed a Step 1 quantitative assessment of goodwill impairment as of December 31, 2020, our annual impairment test date. We compared the carrying value inclusive of goodwill and definite-lived intangible assets, to its fair value. We estimated the fair value of these reporting units by weighting results from the income approach and the market approach, as further described in Note 2 in our Annual Report on Form 10-K for the year ended December 31, 2020. Based on this quantitative test, we determined there was no impairment as of the December 31, 2020. For the interim impairment test as of March 31, 2021, we compared the carrying value inclusive of goodwill and definite-lived intangible assets, to its fair value as of the December 31, 2020. The respective fair values exceeded their respective carrying values. Identifiable intangible assets are stated at cost, net of accumulated amortization. The assets are being amortized on the straight-line method over useful lives ranging from 3 to 11 years. Foreign Currency Translation Our unaudited condensed consolidated financial statements are presented in U.S. dollars. The functional currency for the Company is U.S. dollars. Transactions in currencies other than the functional currency are recorded using the appropriate exchange rate at the time of the transaction. All of our continuing operations are conducted in U.S. dollars except its subsidiary located in Israel. The records of the Israeli operation were maintained in the local currency and re-measured to the functional currency as follows: monetary assets and liabilities are converted using the balance sheet period-end date exchange rate, while the non-monetary assets and liabilities are converted using the historical exchange rate. Expenses and income items are converted using the weighted average exchange rates for the reporting period. Foreign transaction gains and losses are reported on the unaudited condensed consolidated statement of operations and were included in the amount of loss from comprehensive income. Net Loss Per Common Share Net loss per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”. Basic net loss per common share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued, unless doing so is anti-dilutive. The weighted-average number of common shares outstanding for computing basic EPS for the three-months ended March 31, 2021 and 2020 were 4,700,737 and 3,984,006, respectively. Diluted net loss per share of common stock is the same as basic net loss per share of common stock because the effects of potentially dilutive securities are antidilutive. The following table sets forth the potentially dilutive securities excluded from the computation of diluted net loss per share because such securities have an anti-dilutive impact due to losses reported as of: In thousands March 31, 2021 December 31, 2020 Options to purchase common stock 1,648 1,553 Convertible preferred stock - - Warrants to purchase common stock 1,227 75 Potential shares excluded from diluted net loss per share 2,875 1,628 Purchase Accounting and Business Combinations We account for our business combinations using the purchase method of accounting which requires that intangible assets be recognized apart from goodwill if they are contractual in nature or separately identifiable. Acquisitions are measured on the fair value of consideration exchanged and, if the consideration given is not cash, measurement is based on the fair value of the consideration given or the fair value of the assets acquired, whichever is more reliably measurable. The excess of cost of an acquired entity over the fair value of identifiable acquired assets and liabilities assumed is allocated to goodwill. The valuation and allocation processes rely on significant assumptions made by management. In certain situations, the allocations of excess purchase price are based upon preliminary estimates and assumptions. Accordingly, the allocations are subject to revision when we receive updated information, including appraisals and other analyses, which are completed within one year of the acquisition. Revisions to the fair values, which may be significant, are recorded when pending information is finalized, within one year from the acquisition date. Revenue Recognition. When entering into contracts with our customers, we review follow the five steps outline in Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606) i. Identify the contract with our customer. ii. Identify the performance obligations in the contract. iii. Determine the transaction price. iv. Allocate the transaction price to the performance obligations. And v. Evaluate the satisfaction of the performance obligations, We account for contracts, with our customers, when we have approval and commitment from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and collectability of consideration is probable. We evaluate, in accordance with Topic 606, whether we meet the criteria to be a principal or an agent and record the revenue on a gross or net basis. We are considered a principal if we obtain control of any one of the following: i. A good or another asset from another party that we then transfer to our customer. ii. A right to a service to be performed by another party, which gives the us the ability to direct that party to provide the service to the customer on our behalf, and iii. A good or service from another party that we then combine with other goods or services in providing the specified good or service to our customer. We have certain relationships with manufacturers and suppliers to sell us products or provide services. Our contracts may transfer to our customer a right to a future service or product to be provided by our manufacturer or supplier. When a specified good or service is a right to a good or service is provided by a manufacturer or supplier, we evaluate whether we control the right to the goods or services before that right is transferred to the customer rather than whether we control the underlying goods or services. Indicators that we control the specified good or service before it is transferred to the customer (and we are therefore a principal) include, but are not limited to, the following: i. We are responsible for fulfilling the promise to provide the specified good or service. This typically includes responsibility for the acceptability of the specified good or service. If we are primarily responsible for fulfilling the promise to provide the specified good or service, this may indicate that the other party involved in providing the specified good or service is acting on our behalf. Often, we provide value added services (combining hardware, integrating hardware to software, etc.) to the products and services purchased from our manufacturers and suppliers. ii. We have inventory risk before the specified good or service has been transferred to a customer. Our purchases of products or services from our manufactures and suppliers is evidenced by our issuing a binding purchase order contract with the negotiated terms including specifications, pricing, delivery among other things. Our obligation for purchased products and services is mutually exclusive of our customers’ performance (failure to take acceptance, make payment, etc. iii. We have sole discretion in establishing our price for the specified good or service. Establishing the price our customer pays for a specified good or service may indicate we have the ability to direct the use of that good or service and obtain substantially all of the remaining benefits. We control and set the pricing for the product or services to be provided to our customers. If the terms of a transaction do not indicate we are acting as a principal in the transaction, we are then considered acting as an agent and the associated revenues would be recognized on a net basis. As principal, when (or as) we satisfy a performance obligation, we recognize revenue in the gross amount of consideration which we expect to be entitled in exchange for the specified good or service transferred. We are an agent if our performance obligation is to arrange for the provision of the specified good or service by another party. As an agent, we do not control the specified good or service provided by another party before that good or service is transferred to our customer. As an agent, when (or as) we satisfy a performance obligation, we recognize revenue in the amount of any fee or commission which we expect to be entitled in exchange for arranging for the specified goods or services to be provided by another party to our customer. Under Topic 606, we recognize revenue (on either a gross or net basis previously discussed) only when we satisfy a performance obligation by transferring a promised good or service to our customer. A good or service is considered to be transferred when the customer obtains control. The standard defines control as an entity’s ability to direct the use of, and obtain substantially all of the remaining benefits from, an asset. We recognize revenue (either gross or net) once control has passed to the customer. The following indicators are evaluated in determining when control has passed to the customer: i. We have a right to payment for the product or service, ii. The customer has legal title to the product, iii. We have transferred physical possession of the product to the customer, iv. The customer has the risk and rewards of ownership of the product, and v. The customer has accepted the product. Revenue Recognition for Hardware. Manufacturers and suppliers, from whom we purchase hardware, often provide their warranties only providing assurance the products and services will conform to their specifications. These assurance type warranties are not sold separately and are not considered separate performance obligations. In some transactions, a third-party will provide the customer with an extended warranty. These extended warranties are sold separately and provide the customer with a service in addition to assurance that the product will function as expected. We consider these warranties to be separate performance obligations from the underlying product. For warranties, where we are arranging those services be provided by a third-party, we are acting as an agent in the transaction and records revenue on a net basis at the point of sale. Revenue Recognition for Software. As explained above, we evaluate whether the software assurance is a separate performance obligation by assessing if the third-party delivered software assurance is critical or essential to the core functionality of the software itself. This involves considering: i. If the software provides its original intended functionality to the customer without the updates, ii. If the customer would ascribe a higher value to the upgrades versus the up-front deliverable, iii. If the customer would expect frequent intelligence updates to the software (such as updates that maintain the original functionality), and iv. If the customer chooses to not delay or always install upgrades. If we determine the accompanying third-party delivered software assurance is critical or essential to the core functionality of the software license, the software license and the accompanying third-party delivered software assurance are recognized as a single performance obligation. In some transactions, a third-party will provide the customer with an extended warranty. These extended warranties are sold separately and provide the customer with a service in addition to assurance that the product will function as expected. We consider these warranties to be separate performance obligations from the underlying product. For warranties, where we are arranging those services be provided by a third-party, we are acting as an agent in the transaction and records revenue on a net basis at the point of sale. Revenue Recognition for Services. Revenues from the sale of professional and support services, provided by us, are recognized over the period the service is provided. As the customer receives the benefit of the service each month, we recognize the respective revenue on a gross basis as we are acting as a principal in the transaction. Additionally, we manage services team provides project support to customers that are billed on a fixed fee basis. We are acting as the principal in the transaction and recognize revenue on a gross basis based on the total number of hours incurred for the period over the total expected hours for the project. Total expected hours to complete the project is updated for each period and best represents the transfer of control of the service to the customer. Freight Costs. Stock-Based Compensation We periodically issue stock options and warrants to employees and non-employees in non-capital raising transactions for services and for financing costs. We account for stock option and warrant grants issued and vesting to employees based on the authoritative guidance provided by Financial Accounting Standards Board (the “FASB”) where the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. We record stock-based compensation expense according to the provisions of ASC Topic 718, Compensation – Stock Compensation. ASC Topic 718 requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values. Under the provisions of ASC Topic 718, the Company determines the appropriate fair value model to be used for valuing share-based payments and the amortization method for compensation cost. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. We account for equity instruments issued to parties other than employees for acquiring goods or services under guidance of section 505-50-30 of the FASB Accounting Standards Codification (“FASB ASC Section 505-50-30”). Pursuant to FASB ASC Section 505-50-30, all transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date used to determine the fair value of the equity instrument issued is the earlier of the date on which the performance is complete or the date on which it is probable that performance will occur. Recent Accounting Pronouncements We have evaluated the recent pronouncements and believe their adoption will not have a material effect on our financial statements. Reclassifications and Comparability Certain amounts in the financial statements of prior years have been reclassified to conform to the current year presentation for comparative purposes. This had no effect on total assets or net income. |
Going Concern
Going Concern | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 3 – GOING CONCERN The accompanying unaudited condensed consolidated financial statements have been prepared assuming that we will continue as a going concern. As of March 31, 2021, we had a working capital deficit of $26.6 million and an accumulated deficit of $60.1 million. These facts and others raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis. Management’s plan to eliminate the going concern situation includes, but is not limited to, the following: ● The continuation of improving cash flow by maintaining moderate cost reductions (subsequent to aggressive cost reduction actions implemented in previous years); ● Increasing the accounts receivable factoring line of credit; ● Negotiating lower interest rates on outstanding debt; ● Potential issuances of additional common stock; ● The creation of additional sales and profits across its product lines, and the obtaining of sufficient financing to restructure current debt in a manner more in line with the Company’s improving cash flow and cost reduction successes; ● In our portfolio of products, we have a computer vision technology that is based on AI and machine learning concepts. These solutions have a higher gross profit that will provide an increase in cashflow on a consolidated basis going forward. The Company has an operating facility with the ability for light manufacturing and assembling components, which helps reduce the cost of goods and increase profit margins; |
Concentrations
Concentrations | 3 Months Ended |
Mar. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Concentrations | NOTE 4 – CONCENTRATIONS For the three-months ended March 31, 2021 and the year ended December 31, 2020, one customer accounted for 35.8% and 37.2%, respectively, of the Company’s consolidated revenues. Accounts receivable at March 31, 2021 and December 31, 2020 are made up of trade receivables due from customers in the ordinary course of business. Two customers made up 57.6% of the accounts receivable balance at March 31, 2021 and one customer represented 46% of the balance of accounts receivable at December 31, 2020. Accounts payable are made up of amounts due to suppliers in the ordinary course of business at March 31, 2021 and December 31, 2020. One vendor made up 89% and 92.4% of our accounts payable on March 31, 2021 and December 31, 2020, respectively. |
Business Acquisition
Business Acquisition | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Business Acquisition | NOTE 5 – BUSINESS ACQUISITION In February 2020, OMNIQ entered in an asset purchase agreement with Eyepax IT Consulting LLC, a California limited liability company, (“Eyepax”) and its principal owners (collectively the “Sellers”), pursuant to which we purchased certain assets from the Sellers at a cash purchase price of $245,000. As additional consideration, the Company issued to the Sellers 80,000 shares of the Company’s common stock and an option to purchase 20,000 shares of the Company’s common stock at an exercise price of $5.00 per share, subject to adjustment, which shall vest quarterly in four (4) equal installments and expire on February 28, 2023. The Company entered into an employment agreement with Mr. Lalith Caldera, a principal owner of Eyepax, agreeing to pay Mr. Caldera an annual salary of $100,000. |
Credit Facilities and Line of C
Credit Facilities and Line of Credit | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Credit Facilities and Line of Credit | NOTE 6 – CREDIT FACILITIES AND LINE OF CREDIT We maintain operating lines of credit, factoring and revolving credit facilities with banks and finance companies to provide us working capital. In July 2016, we entered into a Factoring and Security Agreement (the “FASA”) with Action Capital Corporation (“Action”) to establish a sale of accounts receivable credit facility, whereby we may obtain short-term financing by selling and assigning acceptable accounts receivable to Action. Pursuant to the FASA, the outstanding principal amount of advances made by Action at any time shall not exceed $5.0 million. Action reserves and withholds to 5% of the face amount of each account purchased in a reserve account. As of March 31, 2021 and December 31, 2020, the balance outstanding was zero and $4.9 million, respectively. The annual interest rate with respect to the daily average balance of unpaid advances outstanding under the FASA (computed on a monthly basis) is equal to the “Prime Rate” of Wells Fargo Bank N.A. plus 2.0%, plus a monthly fee equal to 0.75% of the average outstanding balance. we also pay all other costs incurred by Action under the FASA, including all bank fees. The FASA continues in full force and effect unless terminated by either party upon 30 days’ prior written notice. The FASA credit facility is collateralized with a security interest in certain assets of the Company. The FASA includes customary representations and warranties and default provisions for transactions of this type. |
Related Party Notes Payable
Related Party Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Related Party Notes Payable | NOTE 7 – RELATED PARTY NOTES PAYABLE Related party notes payable, consisted of the following as of: March 31, 2021 December 31, 2020 In thousands Note payable –Marin $ 600 $ 660 Note payable –Thomet 375 413 Note payable–Shareholder Convertible Note - 43 Total notes payable 975 1,116 Less current portion (390 ) (433 ) Long-term portion $ 585 $ 683 Note Payable -Marin In December 2017, we entered into a $660 thousand, 1.89% annual interest rate note payable (the “Marin Note”) with two individuals from whom we previously acquired their company (in 2014). The Marin Note is payable in 60 monthly principal payments of $20 thousand beginning in October 2018. Accrued interest payable as of March 31, 2021, was $56 thousand. Accrued interest is payable at maturity. Note Payable – Thomet In December 2017, we entered into a $750 thousand, zero percent annual interest rate note payable (the “Thomet Note”) with an individual from whom we previously acquired his company (in 2014). The Thomet Note is payable in 60 monthly principal payments of $13 thousand beginning in October 2018. Note Payable – Shareholder Convertible Note In October 2018, we entered into a $700 thousand, 6% annual interest rate convertible note payable (the “Shareholder Convertible Note”) with Walefar and Campbeltown (collectively the “Holders”), in connection with the HTS Image Processing, Inc. Mr Shai Lustgarten, our Chief executive Officer and Director is the principal shareholder in Walefar. Mr. Carlos J. Nissensohn, a consultant and significant shareholder in OMNIQ, is the principal shareholder in Campbeltown. The Shareholder Convertible Note was retired in 2021. Future maturities of related party notes payable as of March 31, 2021, are as follows: In thousands 2021 292 2022 390 2023 293 2024 - Thereafter - Total $ 975 |
Other Notes Payable
Other Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Other Notes Payable | NOTE 8 – OTHER NOTES PAYABLE (In thousands) March 31, 2021 December 31, 2020 Note Payable- Supplier $ 6,443 $ 6,443 All Other 6 7 Total 6,449 6,450 Less current portion (6,449 ) (6,449 ) Long Term Notes Payable $ - $ 1 Note Payable - Supplier On July 18, 2016, the Company and the Supplier entered into a certain secured promissory note, with an effective date of July 1, 2016, in the principal amount of $12.5 million (the “Secured Promissory Note”). The USD Note accrues interest at 18% per annum and is payable in six consecutive monthly installments of principal and accrued interest in a minimum principal amount of $250 thousand each, with any remaining principal and accrued interest due and payable on December 31, 2016. ● On September 7, 2018, the Company entered into a Sixth Amendment to the Secured Promissory Note (the “Sixth Amendment”) extending the maturity date to January 31, 2019. The Sixth Amendment also increases the principal amount to $8.7 million, an increase of $6.8 million, by rolling the Company’s then existing and outstanding accounts payable into the note by the previously mentioned amount of increase. The Company will continue to make monthly payments in the amount of $300 thousand for the first three monthly payments, and also in the amount of $500 thousand for the last two monthly payments prior to the note’s maturity. ● On April 30, 2019, the Company entered into a Seventh Amendment to the Secured Promissory Note (the “Seventh Amendment”) extending the maturity date to July 31, 2019. The Seventh Amendment also provides that the Company will continue to make monthly installments of principal and accrued interest in a minimum principal amount of $350 thousand each. The Company has made partial payments towards the required monthly installments under the terms of the Seventh Amendment. As has been the case with each previous amendment, the Company is in continual negotiations with the holder of the Secured Promissory Note to extend the maturity date and establish a new schedule of payments. |
Other Liabilities
Other Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | NOTE 9 – OTHER LIABILITIES At March 31, 2021 and December 31, 2020, other liabilities consisted of the following: (In thousands) March 31, 2021 December 31, 2020 Other vendor payable $ 801 $ 801 Dividend payable 284 253 Bonus payable - 27 Others 1,473 1,477 Total other liabilities 2,558 2,558 Less Current Portion (1,380 ) (1,412 ) Total long term other liabilities $ 1,178 $ 1,146 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 10 – STOCKHOLDERS’ EQUITY PREFERRED STOCK Series A As of March 31, 2021, there were 1,000,000 Series A preferred shares designated and no Series A preferred shares outstanding. The board of directors of the Company (the “Board”) had previously set the voting rights for the Series A preferred stock at 1 share of preferred to 250 common shares. Series B As of March 31, 2021, there was 1 preferred share designated and no preferred shares outstanding. Series C As of March 31, 2021, there were 5,000,000 Series C Preferred Shares (“Series C”) authorized with 2,145,030 issued and outstanding. The Series C shares have preferential rights above common shares and the Series B Preferred Shares and is entitled to receive a quarterly dividend at a rate of $0.06 per share per annum and have a liquidation preference of $1 per share. Series C shares outstanding are convertible into common stock at the rate of 20 preferred shares to one share of common stock. As of March 31, 2021, the accrued dividends on the Series C Preferred Stock was $284 thousand. The Series C Preferred Stock has a liquidation value and conversion price of $1.00 per share ($20.00 per 20 shares of preferred stock which convert to one share of common stock) and automatically converts into Common Stock at $1.00 per share ($20.00 per 20 shares of preferred stock which convert to one share of common stock) in the event that the Company’s common stock has a closing price of $30 per share for 20 consecutive trading days. COMMON STOCK In August 2020, OMNIQ’ Board of Directors adopted an Equity Incentive Plan (the “Plan”), as an incentive to retain existing employees and attract new employees, directors, officers, consultants, and advisors to the Company. Pursuant to the Plan, one million (1,000,000) shares of the Company’s common stock, par value $0.001 (the “Shares”), were set aside and reserved for issuance. As of March 31, 2021, we had issued 361,146 shares or $1.8 million to consultants and advisors for services rendered. In December 2015, our Board of Directors approved the OMNIQ. Employee Stock Purchase Plan (the “ESPP”). For the three months ending March 31, 2021 employees purchased 317 or $1 thousand shares of commons stock. On February 15, 2021 the Company issued 25,000 shares to Orion 4, LLC as part of a consulting agreement. The shares were valued at $188 thousand. For the three months ending March 31, 2021, 10,000 in stock options and stock warrants were exercised in exchange for 6,160 shares of OMNIQ common stock. For the three months ended March 31, 2021 we did not grant or issue any options or warrants. Warrants The following table summarizes information about warrants granted during the nine-month periods ended March 31, 2021 and 2020: March 31, 2021 March 31, 2020 Number of warrants Weighted Average Exercise Price Number of Weighted Average Exercise Price Balance, beginning of period 1,366,667 $ 7.19 1,166,667 $ 6.42 Warrants granted - 25,000 11.60 Warrants expired 15,000 - - Warrants cancelled, forfeited - - - Warrants exercised - - - Balance, end of period 1,351,667 $ 7.11 1,191,667 $ 6.53 Exercisable warrants 1,185,001 $ 6.94 1,191,667 $ 6.53 Outstanding warrants as of March 31, 2021 are as follows: Weighted Average Weighted Weighted Range of residual life Average Average Exercise span Outstanding Exercise Exercisable Exercise Prices (in years) Warrants Price Warrants Price 2.20 0.34 75,000 $ 2.20 75,000 $ 2.20 7.00 3.52 891,667 7.00 891,667 7.00 7.50 5.43 250,000 7.50 83,334 7.50 8.00 0.91 10,000 8.00 10,000 8.00 10.00 1.97 125,000 10.00 125,000 10.00 2.20 to 10.00 3.54 1,351,667 $ 6.94 1,185,001 $ 6.94 Warrants outstanding at March 31, 2021 and 2020 have the following expiry date and exercise prices: Exercise Expiry Date Prices 2021 2020 June 26, 2020 $ 5.60 - 10,000 October 10, 2020 12.00 - 15,000 December 30, 2020 4.00 - 150,000 February 02, 2021 14.00 - 15,000 August 02, 2021 2.20 75,000 75,000 October 10, 2021 10.00 25,000 25,000 February 27, 2022 8.00 10,000 10,000 May 18, 2023 10.00 50,000 - October 14, 2023 10.00 50,000 - October 06, 2024 7.00 891,667 891,667 September 01, 2025 7.50 83,334 - June 04, 2026 7.50 83,333 - December 04, 2027 7.50 83,333 - 1,351,667 1,191,667 Stock Options The following table summarizes information about stock options granted during the three months ended March 31, 2021 and 2020: March 31, 2021 March 31, 2020 Number of stock options Weighted Average Exercise Price Number of stock options Weighted Average Exercise Price Balance, beginning of period 1,811,550 $ 4.32 1,133,550 $ 4.00 Stock options granted - 20,000 5.00 Stock options expired - 30,250 3.98 Stock options cancelled, forfeited 28,750 - - Stock options exercised 10,000 - - Balance, end of period 1,772,800 $ 4.33 1,230,300 $ 4.01 Exercisable stock options 995,925 $ 4.09 986,925 $ 3.88 On September 30, 2020, the Company granted 775,000 stock options. These options were granted as part of the asset acquisition described in Note 4, and to a member of the board of advisors, and to certain employees as part of the Company’s Equity Incentive Plan. Outstanding stock options as of March 31, 2021 are as follows: Range of Exercise Prices Weighted Average residual life span (in years) Outstanding Stock Options Weighted Average Exercise Price Exercisable Stock Options Weighted Average Exercise Price $ 1.50 .88 38,017 $ 1.50 38,017 $ 1.50 $ 1.80 .88 76,033 $ 1.80 76,033 $ 1.80 $ 2.20 .34 175,000 $ 2.20 175,000 $ 2.20 $ 2.40 1.93 257,000 $ 2.40 257,000 $ 2.40 $ 4.20 4.06 10,000 $ 4.20 5,000 $ 4.20 $ 4.40 8.21 430,500 $ 4.40 80,500 $ 4.40 $ 4.84 9.51 380,000 $ 4.84 - $ 4.84 $ 5.00 2.28 147,500 $ 5.00 105,625 $ 5.00 $ 5.40 2.67 133,750 $ 5.40 133,750 $ 5.40 $ 10.00 3.64 125,000 $ 10.00 125,000 $ 10.00 $ 1.50 to 10.00 5.07 1,772,800 $ 4.33 995,925 $ 4.09 Stock options outstanding at March 31, 2021, and 2020 have the following expiration date and exercise prices: Expiration Date Exercise Prices March 31, 2021 March 31, 2020 August 2, 2021 $ 2.20 175,000 175,000 February 17, 2022 $ 1.50 38,017 38,017 February 17, 2022 $ 1.80 76,033 76,033 February 28, 2023 $ 5.00 20,000 20,000 March 5, 2023 $ 2.40 257,000 335,000 July 31, 2023 $ 5.00 127,500 127,500 October 31, 2023 $ 4.40 80,500 93,000 November 30, 2023 $ 5.40 133,750 133,750 November 20, 2024 $ 10.00 125,000 125,000 April 20, 2025 $ 4.20 10,000 - September 30, 2030 $ 4.40 350,000 - September 30, 2030 $ 4.84 380,000 - 1,772,800 1,123,300 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 11 – COMMITMENTS AND CONTINGENCIES Profit Sharing Plan We maintain a contributory profit-sharing plan covering substantially all fulltime employees within the requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”). In 2016, the Safe Harbor element was removed from the plan and the employer may make a discretionary matching contribution equal to a uniform percentage or dollar amount of participants’ elective deferrals for each Plan Year. In 2015, we were required to make a safe harbor non-elective contribution equal to 3 percent of a participant’s compensation. The plan also includes a 401(k) savings plan feature that allows substantially all employees to make voluntary contributions and provides for discretionary matching contributions determined annually by the Board of Directors. For the three months ending March 31, 2021, we elected to forgo the match. Operating Leases As of March 31, 2021, we had two operating leases as follows: ● Office space in Akron, Ohio, with monthly payments of $3 thousand and an incremental borrowing rate of 14.55%. As of March 31, 2021, we had 26 months remaining on the lease. ● A vehicle with monthly payments of less than $1 thousand. As of March 31, 2021, the Company had 10 months remaining on the lease. |
Litigation
Litigation | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation | NOTE 12 – LITIGATION The Company recently was named a defendant in a Mississippi state lawsuit that is directly related to the RedLPR case (the “Mississippi case”). The Mississippi case also names RedLPR, LLC as a defendant. The Mississippi case was brought by Riverland Park Technologies (“Riverland”). Riverland is also a party to the RedLPR case. The Mississippi case was filed in the Circuit Court of Rankin County, Mississippi on September 21, 2020. The Company was named a defendant in a case involving a former employee who claims he is owed approximately $60 thousand in unpaid commissions. The Company’s position is that the former employee’s claims have no apparent factual basis and appear to be designed to force a quick “nuisance value” settlement. This case was filed in the Superior Court of the State of California, County of San Diego on October 21, 2020. The Company is not a party to any other pending material legal proceeding. To the knowledge of management, no federal, state or local governmental agency is presently contemplating any proceeding against the Company. To the knowledge of management, no director, executive officer or affiliate of the Company, any owner of record or beneficially of more than five percent of the Company’s Common Stock is a party adverse to the Company or has a material interest adverse to the Company in any proceeding. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 13 – RELATED PARTY TRANSACTIONS Related party transactions are discussed in Note 7. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 14 – SUBSEQUENT EVENTS On May 6, 2021, the Company announced it entered into a definitive acquisition agreement pursuant to which OMNIQ will acquire 51% of Dangot Computers Ltd. (“Dangot”), a leader in providing state of the art technology enabling frictionless automated order processing & digital payment processing products for retail, fast food and parking, integrated working stations for physicians, drug delivery and blood tests, robotics for smart warehouses, point of sales and other innovative solutions. Upon the effectiveness of the acquisition, OMNIQ will pay the shareholder of Dangot a total of approximately $7.6 million (depending upon exchange rate to the Israeli Shekel) comprised of approximately $5.6 million to be paid in cash and $2 million in restricted shares based on average closing share price over the 30 trading days prior to signing. OMNIQ will have a one-year option to acquire the remaining 49% at the same valuation. Closing is expected shortly, upon receipt of approval by the Israeli Competition Authority. The Company assessed other potential subsequent events and there were none as of the filing date. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation Our unaudited condensed consolidated financial statements include the financial position and results of operations of OMNIQ Corp. and its wholly owned subsidiaries Quest Marketing, Inc., Quest Exchange Ltd., and HTS Image Processing, Inc., collectively referred to herein as “we” or “us” or “our” or the “Company.” All significant intercompany accounts and transactions have been eliminated in these unaudited condensed consolidated financial statements. Business combinations are included in the unaudited condensed consolidated financial statements from their respective dates of acquisition. We have prepared the interim unaudited condensed consolidated financial statements included herein, in accordance with accounting principles generally accepted in the United States of America, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although we believe the disclosures are adequate to make the information presented not misleading. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these interim financial statements be read in conjunction with our financial statements for the year ended December 31, 2020, and notes thereto included in our Form 10-K filed with the SEC on March 31, 2021. The Company operates in one segment. Operating results for the three months ended March 31, 2021, are not necessarily indicative of the results that may be expected for the year ended December 31, 2021. |
Use of Estimates | Use of Estimates We prepare our unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, which requires management to use its judgment to make estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reported period. These assumptions and estimates could have a material effect on our unaudited condensed consolidated financial statements. Actual results may differ materially from those estimates. We review our estimates on an ongoing basis based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. |
Goodwill and Intangibles | Goodwill and Intangibles We have made acquisitions in the past that resulted in the recognition of goodwill. Goodwill is the excess of the consideration transferred plus the fair value of any non-controlling interest in the acquiree at the acquisition date over the fair values of the identifiable net assets acquired. We evaluate goodwill for impairment annually or more frequently, if triggering events occur or other impairment indicators arise which might impair recoverability. Application of the goodwill impairment test requires judgment. We performed a Step 1 quantitative assessment of goodwill impairment as of December 31, 2020, our annual impairment test date. We compared the carrying value inclusive of goodwill and definite-lived intangible assets, to its fair value. We estimated the fair value of these reporting units by weighting results from the income approach and the market approach, as further described in Note 2 in our Annual Report on Form 10-K for the year ended December 31, 2020. Based on this quantitative test, we determined there was no impairment as of the December 31, 2020. For the interim impairment test as of March 31, 2021, we compared the carrying value inclusive of goodwill and definite-lived intangible assets, to its fair value as of the December 31, 2020. The respective fair values exceeded their respective carrying values. Identifiable intangible assets are stated at cost, net of accumulated amortization. The assets are being amortized on the straight-line method over useful lives ranging from 3 to 11 years. |
Foreign Currency Translation | Foreign Currency Translation Our unaudited condensed consolidated financial statements are presented in U.S. dollars. The functional currency for the Company is U.S. dollars. Transactions in currencies other than the functional currency are recorded using the appropriate exchange rate at the time of the transaction. All of our continuing operations are conducted in U.S. dollars except its subsidiary located in Israel. The records of the Israeli operation were maintained in the local currency and re-measured to the functional currency as follows: monetary assets and liabilities are converted using the balance sheet period-end date exchange rate, while the non-monetary assets and liabilities are converted using the historical exchange rate. Expenses and income items are converted using the weighted average exchange rates for the reporting period. Foreign transaction gains and losses are reported on the unaudited condensed consolidated statement of operations and were included in the amount of loss from comprehensive income. |
Net Loss Per Common Share | Net Loss Per Common Share Net loss per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”. Basic net loss per common share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued, unless doing so is anti-dilutive. The weighted-average number of common shares outstanding for computing basic EPS for the three-months ended March 31, 2021 and 2020 were 4,700,737 and 3,984,006, respectively. Diluted net loss per share of common stock is the same as basic net loss per share of common stock because the effects of potentially dilutive securities are antidilutive. The following table sets forth the potentially dilutive securities excluded from the computation of diluted net loss per share because such securities have an anti-dilutive impact due to losses reported as of: In thousands March 31, 2021 December 31, 2020 Options to purchase common stock 1,648 1,553 Convertible preferred stock - - Warrants to purchase common stock 1,227 75 Potential shares excluded from diluted net loss per share 2,875 1,628 |
Purchase Accounting and Business Combinations | Purchase Accounting and Business Combinations We account for our business combinations using the purchase method of accounting which requires that intangible assets be recognized apart from goodwill if they are contractual in nature or separately identifiable. Acquisitions are measured on the fair value of consideration exchanged and, if the consideration given is not cash, measurement is based on the fair value of the consideration given or the fair value of the assets acquired, whichever is more reliably measurable. The excess of cost of an acquired entity over the fair value of identifiable acquired assets and liabilities assumed is allocated to goodwill. The valuation and allocation processes rely on significant assumptions made by management. In certain situations, the allocations of excess purchase price are based upon preliminary estimates and assumptions. Accordingly, the allocations are subject to revision when we receive updated information, including appraisals and other analyses, which are completed within one year of the acquisition. Revisions to the fair values, which may be significant, are recorded when pending information is finalized, within one year from the acquisition date. |
Revenue Recognition | Revenue Recognition. When entering into contracts with our customers, we review follow the five steps outline in Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606) i. Identify the contract with our customer. ii. Identify the performance obligations in the contract. iii. Determine the transaction price. iv. Allocate the transaction price to the performance obligations. And v. Evaluate the satisfaction of the performance obligations, We account for contracts, with our customers, when we have approval and commitment from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and collectability of consideration is probable. We evaluate, in accordance with Topic 606, whether we meet the criteria to be a principal or an agent and record the revenue on a gross or net basis. We are considered a principal if we obtain control of any one of the following: i. A good or another asset from another party that we then transfer to our customer. ii. A right to a service to be performed by another party, which gives the us the ability to direct that party to provide the service to the customer on our behalf, and iii. A good or service from another party that we then combine with other goods or services in providing the specified good or service to our customer. We have certain relationships with manufacturers and suppliers to sell us products or provide services. Our contracts may transfer to our customer a right to a future service or product to be provided by our manufacturer or supplier. When a specified good or service is a right to a good or service is provided by a manufacturer or supplier, we evaluate whether we control the right to the goods or services before that right is transferred to the customer rather than whether we control the underlying goods or services. Indicators that we control the specified good or service before it is transferred to the customer (and we are therefore a principal) include, but are not limited to, the following: i. We are responsible for fulfilling the promise to provide the specified good or service. This typically includes responsibility for the acceptability of the specified good or service. If we are primarily responsible for fulfilling the promise to provide the specified good or service, this may indicate that the other party involved in providing the specified good or service is acting on our behalf. Often, we provide value added services (combining hardware, integrating hardware to software, etc.) to the products and services purchased from our manufacturers and suppliers. ii. We have inventory risk before the specified good or service has been transferred to a customer. Our purchases of products or services from our manufactures and suppliers is evidenced by our issuing a binding purchase order contract with the negotiated terms including specifications, pricing, delivery among other things. Our obligation for purchased products and services is mutually exclusive of our customers’ performance (failure to take acceptance, make payment, etc. iii. We have sole discretion in establishing our price for the specified good or service. Establishing the price our customer pays for a specified good or service may indicate we have the ability to direct the use of that good or service and obtain substantially all of the remaining benefits. We control and set the pricing for the product or services to be provided to our customers. If the terms of a transaction do not indicate we are acting as a principal in the transaction, we are then considered acting as an agent and the associated revenues would be recognized on a net basis. As principal, when (or as) we satisfy a performance obligation, we recognize revenue in the gross amount of consideration which we expect to be entitled in exchange for the specified good or service transferred. We are an agent if our performance obligation is to arrange for the provision of the specified good or service by another party. As an agent, we do not control the specified good or service provided by another party before that good or service is transferred to our customer. As an agent, when (or as) we satisfy a performance obligation, we recognize revenue in the amount of any fee or commission which we expect to be entitled in exchange for arranging for the specified goods or services to be provided by another party to our customer. Under Topic 606, we recognize revenue (on either a gross or net basis previously discussed) only when we satisfy a performance obligation by transferring a promised good or service to our customer. A good or service is considered to be transferred when the customer obtains control. The standard defines control as an entity’s ability to direct the use of, and obtain substantially all of the remaining benefits from, an asset. We recognize revenue (either gross or net) once control has passed to the customer. The following indicators are evaluated in determining when control has passed to the customer: i. We have a right to payment for the product or service, ii. The customer has legal title to the product, iii. We have transferred physical possession of the product to the customer, iv. The customer has the risk and rewards of ownership of the product, and v. The customer has accepted the product. Revenue Recognition for Hardware. Manufacturers and suppliers, from whom we purchase hardware, often provide their warranties only providing assurance the products and services will conform to their specifications. These assurance type warranties are not sold separately and are not considered separate performance obligations. In some transactions, a third-party will provide the customer with an extended warranty. These extended warranties are sold separately and provide the customer with a service in addition to assurance that the product will function as expected. We consider these warranties to be separate performance obligations from the underlying product. For warranties, where we are arranging those services be provided by a third-party, we are acting as an agent in the transaction and records revenue on a net basis at the point of sale. Revenue Recognition for Software. As explained above, we evaluate whether the software assurance is a separate performance obligation by assessing if the third-party delivered software assurance is critical or essential to the core functionality of the software itself. This involves considering: i. If the software provides its original intended functionality to the customer without the updates, ii. If the customer would ascribe a higher value to the upgrades versus the up-front deliverable, iii. If the customer would expect frequent intelligence updates to the software (such as updates that maintain the original functionality), and iv. If the customer chooses to not delay or always install upgrades. If we determine the accompanying third-party delivered software assurance is critical or essential to the core functionality of the software license, the software license and the accompanying third-party delivered software assurance are recognized as a single performance obligation. In some transactions, a third-party will provide the customer with an extended warranty. These extended warranties are sold separately and provide the customer with a service in addition to assurance that the product will function as expected. We consider these warranties to be separate performance obligations from the underlying product. For warranties, where we are arranging those services be provided by a third-party, we are acting as an agent in the transaction and records revenue on a net basis at the point of sale. Revenue Recognition for Services. Revenues from the sale of professional and support services, provided by us, are recognized over the period the service is provided. As the customer receives the benefit of the service each month, we recognize the respective revenue on a gross basis as we are acting as a principal in the transaction. Additionally, we manage services team provides project support to customers that are billed on a fixed fee basis. We are acting as the principal in the transaction and recognize revenue on a gross basis based on the total number of hours incurred for the period over the total expected hours for the project. Total expected hours to complete the project is updated for each period and best represents the transfer of control of the service to the customer. Freight Costs. |
Stock-Based Compensation | Stock-Based Compensation We periodically issue stock options and warrants to employees and non-employees in non-capital raising transactions for services and for financing costs. We account for stock option and warrant grants issued and vesting to employees based on the authoritative guidance provided by Financial Accounting Standards Board (the “FASB”) where the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. We record stock-based compensation expense according to the provisions of ASC Topic 718, Compensation – Stock Compensation. ASC Topic 718 requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values. Under the provisions of ASC Topic 718, the Company determines the appropriate fair value model to be used for valuing share-based payments and the amortization method for compensation cost. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. We account for equity instruments issued to parties other than employees for acquiring goods or services under guidance of section 505-50-30 of the FASB Accounting Standards Codification (“FASB ASC Section 505-50-30”). Pursuant to FASB ASC Section 505-50-30, all transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date used to determine the fair value of the equity instrument issued is the earlier of the date on which the performance is complete or the date on which it is probable that performance will occur. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements We have evaluated the recent pronouncements and believe their adoption will not have a material effect on our financial statements. |
Reclassifications and Comparability | Reclassifications and Comparability Certain amounts in the financial statements of prior years have been reclassified to conform to the current year presentation for comparative purposes. This had no effect on total assets or net income. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Anti Dilutive Securities Excludes from Computation of Earnings Per Share | The following table sets forth the potentially dilutive securities excluded from the computation of diluted net loss per share because such securities have an anti-dilutive impact due to losses reported as of: In thousands March 31, 2021 December 31, 2020 Options to purchase common stock 1,648 1,553 Convertible preferred stock - - Warrants to purchase common stock 1,227 75 Potential shares excluded from diluted net loss per share 2,875 1,628 |
Related Party Notes Payable (Ta
Related Party Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable, Related Parties | Related party notes payable, consisted of the following as of: March 31, 2021 December 31, 2020 In thousands Note payable –Marin $ 600 $ 660 Note payable –Thomet 375 413 Note payable–Shareholder Convertible Note - 43 Total notes payable 975 1,116 Less current portion (390 ) (433 ) Long-term portion $ 585 $ 683 |
Schedule of Future Maturities of Notes Payable, Related Parties | Future maturities of related party notes payable as of March 31, 2021, are as follows: In thousands 2021 292 2022 390 2023 293 2024 - Thereafter - Total $ 975 |
Other Notes Payable (Tables)
Other Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Other Notes Payable | Other notes payable at March 31, 2021 and December 31, 2020, consists of the following: (In thousands) March 31, 2021 December 31, 2020 Note Payable- Supplier $ 6,443 $ 6,443 All Other 6 7 Total 6,449 6,450 Less current portion (6,449 ) (6,449 ) Long Term Notes Payable $ - $ 1 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Liabilities | At March 31, 2021 and December 31, 2020, other liabilities consisted of the following: (In thousands) March 31, 2021 December 31, 2020 Other vendor payable $ 801 $ 801 Dividend payable 284 253 Bonus payable - 27 Others 1,473 1,477 Total other liabilities 2,558 2,558 Less Current Portion (1,380 ) (1,412 ) Total long term other liabilities $ 1,178 $ 1,146 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of Warrants Activity | The following table summarizes information about warrants granted during the nine-month periods ended March 31, 2021 and 2020: March 31, 2021 March 31, 2020 Number of warrants Weighted Average Exercise Price Number of Weighted Average Exercise Price Balance, beginning of period 1,366,667 $ 7.19 1,166,667 $ 6.42 Warrants granted - 25,000 11.60 Warrants expired 15,000 - - Warrants cancelled, forfeited - - - Warrants exercised - - - Balance, end of period 1,351,667 $ 7.11 1,191,667 $ 6.53 Exercisable warrants 1,185,001 $ 6.94 1,191,667 $ 6.53 |
Schedule of Outstanding Warrants | Outstanding warrants as of March 31, 2021 are as follows: Weighted Average Weighted Weighted Range of residual life Average Average Exercise span Outstanding Exercise Exercisable Exercise Prices (in years) Warrants Price Warrants Price 2.20 0.34 75,000 $ 2.20 75,000 $ 2.20 7.00 3.52 891,667 7.00 891,667 7.00 7.50 5.43 250,000 7.50 83,334 7.50 8.00 0.91 10,000 8.00 10,000 8.00 10.00 1.97 125,000 10.00 125,000 10.00 2.20 to 10.00 3.54 1,351,667 $ 6.94 1,185,001 $ 6.94 |
Schedule of Warrants Outstanding, Expiry Date and Exercise Prices | Warrants outstanding at March 31, 2021 and 2020 have the following expiry date and exercise prices: Exercise Expiry Date Prices 2021 2020 June 26, 2020 $ 5.60 - 10,000 October 10, 2020 12.00 - 15,000 December 30, 2020 4.00 - 150,000 February 02, 2021 14.00 - 15,000 August 02, 2021 2.20 75,000 75,000 October 10, 2021 10.00 25,000 25,000 February 27, 2022 8.00 10,000 10,000 May 18, 2023 10.00 50,000 - October 14, 2023 10.00 50,000 - October 06, 2024 7.00 891,667 891,667 September 01, 2025 7.50 83,334 - June 04, 2026 7.50 83,333 - December 04, 2027 7.50 83,333 - 1,351,667 1,191,667 |
Schedule of Stock Options Granted | The following table summarizes information about stock options granted during the three months ended March 31, 2021 and 2020: March 31, 2021 March 31, 2020 Number of stock options Weighted Average Exercise Price Number of stock options Weighted Average Exercise Price Balance, beginning of period 1,811,550 $ 4.32 1,133,550 $ 4.00 Stock options granted - 20,000 5.00 Stock options expired - 30,250 3.98 Stock options cancelled, forfeited 28,750 - - Stock options exercised 10,000 - - Balance, end of period 1,772,800 $ 4.33 1,230,300 $ 4.01 Exercisable stock options 995,925 $ 4.09 986,925 $ 3.88 |
Schedule of Outstanding Stock Options | Outstanding stock options as of March 31, 2021 are as follows: Range of Exercise Prices Weighted Average residual life span (in years) Outstanding Stock Options Weighted Average Exercise Price Exercisable Stock Options Weighted Average Exercise Price $ 1.50 .88 38,017 $ 1.50 38,017 $ 1.50 $ 1.80 .88 76,033 $ 1.80 76,033 $ 1.80 $ 2.20 .34 175,000 $ 2.20 175,000 $ 2.20 $ 2.40 1.93 257,000 $ 2.40 257,000 $ 2.40 $ 4.20 4.06 10,000 $ 4.20 5,000 $ 4.20 $ 4.40 8.21 430,500 $ 4.40 80,500 $ 4.40 $ 4.84 9.51 380,000 $ 4.84 - $ 4.84 $ 5.00 2.28 147,500 $ 5.00 105,625 $ 5.00 $ 5.40 2.67 133,750 $ 5.40 133,750 $ 5.40 $ 10.00 3.64 125,000 $ 10.00 125,000 $ 10.00 $ 1.50 to 10.00 5.07 1,772,800 $ 4.33 995,925 $ 4.09 |
Schedule of Stock Options, Expiry Date and Exercise Prices | Stock options outstanding at March 31, 2021, and 2020 have the following expiration date and exercise prices: Expiration Date Exercise Prices March 31, 2021 March 31, 2020 August 2, 2021 $ 2.20 175,000 175,000 February 17, 2022 $ 1.50 38,017 38,017 February 17, 2022 $ 1.80 76,033 76,033 February 28, 2023 $ 5.00 20,000 20,000 March 5, 2023 $ 2.40 257,000 335,000 July 31, 2023 $ 5.00 127,500 127,500 October 31, 2023 $ 4.40 80,500 93,000 November 30, 2023 $ 5.40 133,750 133,750 November 20, 2024 $ 10.00 125,000 125,000 April 20, 2025 $ 4.20 10,000 - September 30, 2030 $ 4.40 350,000 - September 30, 2030 $ 4.84 380,000 - 1,772,800 1,123,300 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Impairment of goodwill | |||
Weighted average number of common shares outstanding | 4,700,737 | 3,984,006 | |
Minimum [Member] | |||
Finite-lived intangible asset, useful life | 3 years | ||
Maximum [Member] | |||
Finite-lived intangible asset, useful life | 11 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Anti Dilutive Securities Excludes from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Potential shares excluded from diluted net loss per share | 2,875,000 | 1,628,000 |
Options to Purchase Common Stock [Member] | ||
Potential shares excluded from diluted net loss per share | 1,648,000 | 1,553,000 |
Convertible Preferred Stock [Member] | ||
Potential shares excluded from diluted net loss per share | ||
Warrants to Purchase Common Stock [Member] | ||
Potential shares excluded from diluted net loss per share | 1,227,000 | 75,000 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Working capital deficit | $ 26,600 | |
Accumulated deficit | $ (60,104) | $ (56,726) |
Concentrations (Details Narrati
Concentrations (Details Narrative) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
One Customer [Member] | Revenue [Member] | ||
Concentration risk, percentage | 35.80% | 37.20% |
One Customer [Member] | Accounts Receivable [Member] | ||
Concentration risk, percentage | 46.00% | |
Two Customer [Member] | Accounts Receivable [Member] | ||
Concentration risk, percentage | 57.60% | |
Two Customer [Member] | Accounts Payable [Member] | ||
Concentration risk, percentage | 89.00% | |
One Vendor [Member] | Accounts Payable [Member] | ||
Concentration risk, percentage | 92.40% |
Business Acquisition (Details N
Business Acquisition (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | |
Number of options granted to purchase common stock | 20,000 | ||
Weighted average exercise price, stock options granted | $ 5 | ||
Asset Purchase Agreement [Member] | Eyepax IT Consulting, LLC [Member] | |||
Cash purchase price | $ 245 | ||
Number of shares will be issued | 80 | ||
Number of options granted to purchase common stock | 20 | ||
Weighted average exercise price, stock options granted | $ 5 | ||
Stock options, expiration date | Feb. 28, 2023 | ||
Employment Agreement [Member] | Mr. Caldera [Member] | |||
Annual salary | $ 100 |
Credit Facilities and Line of_2
Credit Facilities and Line of Credit (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | ||
Jul. 31, 2016 | Dec. 31, 2020 | Mar. 31, 2020 | |
Line of credit, balance | $ 4,900 | $ 4,900 | |
Action Capital Corporation [Member] | Factoring and Security Agreement [Member] | |||
Line of credit maximum borrowing capacity | $ 5,000 | ||
Percentage of reserve account | 5.00% | ||
Percentage of average outstanding balance | 0.75% | ||
Action Capital Corporation [Member] | Factoring and Security Agreement [Member] | Prime Rate [Member] | |||
Percentage of average outstanding balance | 2.00% |
Related party Notes Payable (De
Related party Notes Payable (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | |||
Oct. 31, 2018 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2017 | |
Note payable, related parties | $ 975 | $ 1,116 | ||
Accrued interest payable | 59 | 56 | ||
Marin Note [Member] | ||||
Note payable, related parties | $ 660 | |||
Debt instruments interest rate | 1.89% | |||
Monthly principal payments | $ 20 | |||
Thomet Note [Member] | ||||
Note payable, related parties | $ 750 | |||
Debt instruments interest rate | 0.00% | |||
Monthly principal payments | 13 | |||
Note Payable - Shareholder Convertible Note [Member] | ||||
Note payable, related parties | $ 700 | $ 43 | ||
Debt instruments interest rate | 6.00% |
Related party Notes Payable - S
Related party Notes Payable - Schedule of Notes Payable, Related Parties (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Oct. 31, 2018 |
Total notes payable | $ 975 | $ 1,116 | |
Less: current portion | (390) | (433) | |
Long Term Notes Payable | 585 | 683 | |
Note Payable Marin [Member] | |||
Total notes payable | 600 | 660 | |
Note Payable Thomet [Member] | |||
Total notes payable | 375 | 413 | |
Note Payable - Shareholder Convertible Note [Member] | |||
Total notes payable | $ 43 | $ 700 |
Related party Notes Payable -_2
Related party Notes Payable - Schedule of Future Maturities of Notes Payable, Related Parties (Details) - Notes Payable, Related Parties [Member] $ in Thousands | Mar. 31, 2021USD ($) |
2021 | $ 292 |
2022 | 390 |
2023 | 293 |
2024 | |
Thereafter | |
Total | $ 975 |
Other Notes Payable (Details Na
Other Notes Payable (Details Narrative) - USD ($) $ in Thousands | Sep. 07, 2018 | Jul. 18, 2016 | Apr. 30, 2019 |
First Minimum Payment [Member] | |||
Debt instruments periodic payment | $ 350 | ||
Secured Promissory Note [Member] | |||
Debt instrument face amount | $ 12,500 | ||
Debt instruments interest rate | 18.00% | ||
Debt instruments periodic payment | $ 250 | ||
Debt instrument due date | Dec. 31, 2016 | ||
Sixth Amendment Agreement [Member] | Secured Promissory Note [Member] | |||
Debt instrument face amount | $ 8,700 | ||
Debt instrument, increase, accrued interest | 6,800 | ||
Sixth Amendment Agreement [Member] | First Three Monthly Payments [Member] | Secured Promissory Note [Member] | |||
Debt instruments periodic payment | 300 | ||
Sixth Amendment Agreement [Member] | Last Two Monthly Payments [Member] | Secured Promissory Note [Member] | |||
Debt instruments periodic payment | $ 500 |
Other Notes Payable - Schedule
Other Notes Payable - Schedule of Other Notes Payable (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Total notes payable | $ 6,449 | $ 6,450 |
Less: current portion | (6,449) | (6,449) |
Long Term Notes Payable | 1 | |
Note Payable- Supplier [Member] | ||
Total notes payable | 6,443 | 6,443 |
All Other [Member] | ||
Total notes payable | $ 6 | $ 7 |
Other Liabilities - Schedule of
Other Liabilities - Schedule of Other Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Other vendor payable | $ 801 | $ 801 |
Dividend payable | 284 | 253 |
Bonus payable | 27 | |
Others | 1,473 | 1,477 |
Total other liabilities | 2,558 | 2,558 |
Less Current Portion | (1,380) | (1,412) |
Total long term other liabilities | $ 1,178 | $ 1,146 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Feb. 15, 2021 | Sep. 30, 2020 | Aug. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Common stock, price per share | $ 0.001 | $ 0.001 | ||||
Number of shares for services | ||||||
Number of shares for services, value | $ 188 | |||||
Value issued under employee stock purchase plan | $ 1 | |||||
Stock options exercised during period shares | 10,000 | |||||
Stock Options [Member] | ||||||
Stock options granted | 775,000 | |||||
Common Stock [Member] | ||||||
Value of stock converted during period | ||||||
Number of shares for services | 25,000 | |||||
Number of shares for services, value | ||||||
Value issued under employee stock purchase plan | ||||||
Stock options exercised during period shares | 10,000 | |||||
Common Stock [Member] | Orion 4, LLC [Member] | Consulting Agreement [Member] | ||||||
Number of shares for services | 25,000 | |||||
Number of shares for services, value | $ 188 | |||||
Warrants to Purchase Common Stock [Member] | ||||||
Stock options exercised during period shares | 6,160 | |||||
Equity Incentive Plan [Member] | Common Stock [Member] | ||||||
Number of stock issued | 1,000,000 | |||||
Common stock, price per share | $ 0.001 | |||||
Employee Stock Purchase Plan [Member] | Common Stock [Member] | ||||||
Stock issued under employee stock purchase plan, shares | 317 | |||||
Value issued under employee stock purchase plan | $ 1 | |||||
Board of Directors [Member] | ||||||
Preferred stock voting rights | The board of directors of the Company (the "Board") had previously set the voting rights for the Series A preferred stock at 1 share of preferred to 250 common shares. | |||||
Consultants and Advisors [Member] | Equity Incentive Plan [Member] | Common Stock [Member] | ||||||
Number of shares for services | 361,146 | |||||
Number of shares for services, value | $ 1,800 | |||||
Series A Preferred Stock [Member] | ||||||
Preferred stock shares authorized | 1,000,000 | 1,000,000 | ||||
Preferred stock, shares issued | 0 | 0 | ||||
Preferred stock shares outstanding | 0 | 0 | ||||
Series B Preferred Stock [Member] | ||||||
Preferred stock shares authorized | 1 | 1 | ||||
Preferred stock, shares issued | 0 | 0 | ||||
Preferred stock shares outstanding | 0 | 0 | ||||
Series C Preferred Stock [Member] | ||||||
Preferred stock shares authorized | 5,000,000 | 5,000,000 | ||||
Preferred stock, shares issued | 2,145,030 | 2,145,030 | ||||
Preferred stock shares outstanding | 2,145,030 | 2,145,030 | ||||
Dividend rate per annum | $ 0.06 | |||||
Liquidation preference per share | $ 1 | |||||
Accrued dividends | $ 284 | |||||
Value of stock converted during period | ||||||
Preferred stock conversion, description | The Series C Preferred Stock has a liquidation value and conversion price of $1.00 per share ($20.00 per 20 shares of preferred stock which convert to one share of common stock) and automatically converts into Common Stock at $1.00 per share ($20.00 per 20 shares of preferred stock which convert to one share of common stock) in the event that the Company's common stock has a closing price of $30 per share for 20 consecutive trading days. | |||||
Preferred stock, conversion price per share | $ 1 | |||||
Preferred stock closing price per shares | $ 30 | |||||
Number of shares for services, value | ||||||
Value issued under employee stock purchase plan |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Warrants Activity (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Equity [Abstract] | ||
Number of warrants, Outstanding, Beginning of period | 1,366,667 | 1,166,667 |
Number of warrants, Warrants granted | 25,000 | |
Number of warrants, Warrants expired | 15,000 | |
Number of warrants, Warrants cancelled, forfeited | ||
Number of warrants, Warrants exercised | ||
Number of warrants, Outstanding, End of period | 1,351,667 | 1,191,667 |
Number of warrants, Exercisable warrants | 1,185,001 | 1,191,667 |
Weighted Average Exercise Price balance, Outstanding, Beginning of period | $ 7.19 | $ 6.42 |
Weighted Average Exercise Price, Warrants granted | 11.60 | |
Weighted Average Exercise Price, Warrants expired | ||
Weighted Average Exercise Price, Warrants cancelled, forfeited | ||
Weighted Average Exercise Price, Warrants exercised | ||
Weighted Average Exercise Price, Outstanding, End of period | 7.11 | 6.53 |
Weighted Average Exercise Price, Exercisable warrants | $ 6.94 | $ 6.53 |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of Outstanding Warrants (Details) - Warrants to Purchase Common Stock [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Range of Exercise Prices, Upper Range Limit | $ 10 |
Range of Exercise Prices, Lower Range Limit | $ 2.20 |
Weighted Average residual life span (in years) | 3 years 6 months 14 days |
Outstanding Warrants | shares | 1,351,667 |
Weighted Average Exercise Price | $ 6.94 |
Exercisable Warrants | shares | 1,185,001 |
Weighted Average Exercise Price | $ 6.94 |
Exercise Price Range 1 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 2.20 |
Weighted Average residual life span (in years) | 4 months 2 days |
Outstanding Warrants | shares | 75,000 |
Weighted Average Exercise Price | $ 2.20 |
Exercisable Warrants | shares | 75,000 |
Weighted Average Exercise Price | $ 2.20 |
Exercise Price Range 2 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 7 |
Weighted Average residual life span (in years) | 3 years 6 months 7 days |
Outstanding Warrants | shares | 891,667 |
Weighted Average Exercise Price | $ 7 |
Exercisable Warrants | shares | 891,667 |
Weighted Average Exercise Price | $ 7 |
Exercise Price Range 3 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 7.50 |
Weighted Average residual life span (in years) | 5 years 5 months 5 days |
Outstanding Warrants | shares | 250,000 |
Weighted Average Exercise Price | $ 7.50 |
Exercisable Warrants | shares | 83,334 |
Weighted Average Exercise Price | $ 7.50 |
Exercise Price Range 4 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 8 |
Weighted Average residual life span (in years) | 10 months 28 days |
Outstanding Warrants | shares | 10,000 |
Weighted Average Exercise Price | $ 8 |
Exercisable Warrants | shares | 10,000 |
Weighted Average Exercise Price | $ 8 |
Exercise Price Range 5 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 10 |
Weighted Average residual life span (in years) | 1 year 11 months 19 days |
Outstanding Warrants | shares | 125,000 |
Weighted Average Exercise Price | $ 10 |
Exercisable Warrants | shares | 125,000 |
Weighted Average Exercise Price | $ 10 |
Stockholders' Equity - Schedu_3
Stockholders' Equity - Schedule of Warrants Outstanding, Expiry Date and Exercise Prices (Details) - $ / shares | Mar. 31, 2021 | Mar. 31, 2020 |
Warrant Outstanding | 1,351,667 | 1,191,667 |
June 26, 2020 [Member] | ||
Warrant Expiry Date | Jun. 26, 2020 | |
Warrant Exercise Prices | $ 5.60 | |
Warrant Outstanding | 10,000 | |
October 10, 2020 [Member] | ||
Warrant Expiry Date | Oct. 10, 2020 | |
Warrant Exercise Prices | $ 12 | |
Warrant Outstanding | 15,000 | |
December 30, 2020 [Member] | ||
Warrant Expiry Date | Dec. 30, 2020 | |
Warrant Exercise Prices | $ 4 | |
Warrant Outstanding | 150,000 | |
February 02, 2021 [Member] | ||
Warrant Expiry Date | Feb. 2, 2021 | |
Warrant Exercise Prices | $ 14 | |
Warrant Outstanding | 15,000 | |
August 2, 2021 [Member] | ||
Warrant Expiry Date | Aug. 2, 2021 | |
Warrant Exercise Prices | $ 2.20 | |
Warrant Outstanding | 75,000 | 75,000 |
October 10, 2021 [Member] | ||
Warrant Expiry Date | Oct. 10, 2021 | |
Warrant Exercise Prices | $ 10 | |
Warrant Outstanding | 25,000 | 25,000 |
February 27, 2022 [Member] | ||
Warrant Expiry Date | Feb. 27, 2022 | |
Warrant Exercise Prices | $ 8 | |
Warrant Outstanding | 10,000 | 10,000 |
May 18, 2023 [Member] | ||
Warrant Expiry Date | May 18, 2023 | |
Warrant Exercise Prices | $ 10 | |
Warrant Outstanding | 50,000 | |
October 14, 2023 [Member] | ||
Warrant Expiry Date | Oct. 14, 2023 | |
Warrant Exercise Prices | $ 10 | |
Warrant Outstanding | 50,000 | |
October 6, 2024 [Member] | ||
Warrant Expiry Date | Oct. 6, 2024 | |
Warrant Exercise Prices | $ 7 | |
Warrant Outstanding | 891,667 | 891,667 |
September 1, 2025 [Member] | ||
Warrant Expiry Date | Sep. 1, 2025 | |
Warrant Exercise Prices | $ 7.50 | |
Warrant Outstanding | 83,334 | |
June 4, 2026 [Member] | ||
Warrant Expiry Date | Jun. 4, 2026 | |
Warrant Exercise Prices | $ 7.50 | |
Warrant Outstanding | 83,333 | |
December 4, 2027 [Member] | ||
Warrant Expiry Date | Dec. 4, 2027 | |
Warrant Exercise Prices | $ 7.50 | |
Warrant Outstanding | 83,333 |
Stockholders' Equity - Schedu_4
Stockholders' Equity - Schedule of Stock Options Granted (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Equity [Abstract] | ||
Number of stock options, Outstanding, Beginning of period | 1,811,550 | 1,133,550 |
Number of stock options, Stock options granted | 20,000 | |
Number of stock options, Stock options expired | 30,250 | |
Number of stock options, Stock options cancelled, forfeited | 28,750 | |
Number of stock options, Stock options exercised | 10,000 | |
Number of stock options, Outstanding, End of period | 1,772,800 | 1,230,300 |
Number of stock options, Exercisable stock options | 995,925 | 986,925 |
Weighted Average Exercise Price, Outstanding, Beginning of period | $ 4.32 | $ 4 |
Weighted Average Exercise Price, Stock options granted | 5 | |
Weighted Average Exercise Price, Stock options expired | 3.98 | |
Weighted Average Exercise Price, Stock options cancelled, forfeited | ||
Weighted Average Exercise Price, Stock options exercised | ||
Weighted Average Exercise Price, Outstanding, End of period | 4.33 | 4.01 |
Weighted Average Exercise Price, Exercisable stock options | $ 4.09 | $ 3.88 |
Stockholders' Equity - Schedu_5
Stockholders' Equity - Schedule of Outstanding Stock Options (Details) - Stock Options [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Range of Exercise Prices, Upper Range Limit | $ 10 |
Range of Exercise Prices, Lower Range Limit | $ 1.50 |
Weighted Average residual life span (in years) | 5 years 26 days |
Outstanding Stock Options | shares | 1,772,800 |
Weighted Average Exercise Price | $ 4.30 |
Exercisable Stock Options | shares | 995,925 |
Weighted Average Exercise Price | $ 4.09 |
Exercise Price Range 1 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 1.50 |
Weighted Average residual life span (in years) | 10 months 17 days |
Outstanding Stock Options | shares | 38,017 |
Weighted Average Exercise Price | $ 1.50 |
Exercisable Stock Options | shares | 38,017 |
Weighted Average Exercise Price | $ 1.50 |
Exercise Price Range 2 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 1.80 |
Weighted Average residual life span (in years) | 10 months 17 days |
Outstanding Stock Options | shares | 76,033 |
Weighted Average Exercise Price | $ 1.80 |
Exercisable Stock Options | shares | 76,033 |
Weighted Average Exercise Price | $ 1.80 |
Exercise Price Range 3 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 2.20 |
Weighted Average residual life span (in years) | 4 months 2 days |
Outstanding Stock Options | shares | 175,000 |
Weighted Average Exercise Price | $ 2.20 |
Exercisable Stock Options | shares | 175,000 |
Weighted Average Exercise Price | $ 2.20 |
Exercise Price Range 4 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 2.40 |
Weighted Average residual life span (in years) | 1 year 11 months 4 days |
Outstanding Stock Options | shares | 257,000 |
Weighted Average Exercise Price | $ 2.40 |
Exercisable Stock Options | shares | 257,000 |
Weighted Average Exercise Price | $ 2.40 |
Exercise Price Range 5 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 4.20 |
Weighted Average residual life span (in years) | 4 years 22 days |
Outstanding Stock Options | shares | 10,000 |
Weighted Average Exercise Price | $ 4.20 |
Exercisable Stock Options | shares | 5,000 |
Weighted Average Exercise Price | $ 4.20 |
Exercise Price Range 6 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 4.40 |
Weighted Average residual life span (in years) | 8 years 2 months 16 days |
Outstanding Stock Options | shares | 430,500 |
Weighted Average Exercise Price | $ 4.40 |
Exercisable Stock Options | shares | 80,500 |
Weighted Average Exercise Price | $ 4.40 |
Exercise Price Range 7 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 4.84 |
Weighted Average residual life span (in years) | 9 years 6 months 3 days |
Outstanding Stock Options | shares | 380,000 |
Weighted Average Exercise Price | $ 4.84 |
Exercisable Stock Options | shares | |
Weighted Average Exercise Price | $ 4.84 |
Exercise Price Range 8 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 5 |
Weighted Average residual life span (in years) | 2 years 3 months 11 days |
Outstanding Stock Options | shares | 147,500 |
Weighted Average Exercise Price | $ 5 |
Exercisable Stock Options | shares | 105,625 |
Weighted Average Exercise Price | $ 5 |
Exercise Price Range 9 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 5.40 |
Weighted Average residual life span (in years) | 2 years 8 months 2 days |
Outstanding Stock Options | shares | 133,750 |
Weighted Average Exercise Price | $ 5.40 |
Exercisable Stock Options | shares | 133,750 |
Weighted Average Exercise Price | $ 5.40 |
Exercise Price Range 10 [Member] | |
Range of Exercise Prices, Upper Range Limit | $ 10 |
Weighted Average residual life span (in years) | 3 years 7 months 21 days |
Outstanding Stock Options | shares | 125,000 |
Weighted Average Exercise Price | $ 10 |
Exercisable Stock Options | shares | 125,000 |
Weighted Average Exercise Price | $ 10 |
Stockholders' Equity - Schedu_6
Stockholders' Equity - Schedule of Stock Options, Expiry Date and Exercise Prices (Details) - $ / shares | 3 Months Ended | |||
Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | |
Stock option exercise prices | $ 4.33 | $ 4.32 | $ 4.01 | $ 4 |
Stock option outstanding | 1,772,800 | 1,811,550 | 1,230,300 | 1,133,550 |
August 2, 2021 [Member] | ||||
Stock option expiration date | Aug. 2, 2021 | |||
Stock option exercise prices | $ 2.20 | |||
Stock option outstanding | 175,000 | 175,000 | ||
February 17, 2022 [Member] | ||||
Stock option expiration date | Feb. 17, 2022 | |||
Stock option exercise prices | $ 1.50 | |||
Stock option outstanding | 38,017 | 38,017 | ||
February 17, 2022 [Member] | ||||
Stock option expiration date | Feb. 17, 2022 | |||
Stock option exercise prices | $ 1.80 | |||
Stock option outstanding | 76,033 | 76,033 | ||
February 28, 2023 [Member] | ||||
Stock option expiration date | Feb. 28, 2023 | |||
Stock option exercise prices | $ 5 | |||
Stock option outstanding | 20,000 | 20,000 | ||
March 05, 2023 [Member] | ||||
Stock option expiration date | Mar. 5, 2023 | |||
Stock option exercise prices | $ 2.40 | |||
Stock option outstanding | 257,000 | 335,000 | ||
July 31, 2023 [Member] | ||||
Stock option expiration date | Jul. 31, 2023 | |||
Stock option exercise prices | $ 5 | |||
Stock option outstanding | 127,500 | 127,500 | ||
October 31, 2023 [Member] | ||||
Stock option expiration date | Oct. 31, 2023 | |||
Stock option exercise prices | $ 4.40 | |||
Stock option outstanding | 80,500 | 93,000 | ||
November 30, 2023 [Member] | ||||
Stock option expiration date | Nov. 30, 2023 | |||
Stock option exercise prices | $ 5.40 | |||
Stock option outstanding | 133,750 | 133,750 | ||
November 20, 2024 [Member] | ||||
Stock option expiration date | Nov. 20, 2024 | |||
Stock option exercise prices | $ 10 | |||
Stock option outstanding | 125,000 | 125,000 | ||
April 20, 2025 [Member] | ||||
Stock option expiration date | Apr. 20, 2025 | |||
Stock option exercise prices | $ 4.20 | |||
Stock option outstanding | 10,000 | |||
September 30, 2030 [Member] | ||||
Stock option expiration date | Sep. 30, 2030 | |||
Stock option exercise prices | $ 4.40 | |||
Stock option outstanding | 350,000 | |||
September 30, 2030 [Member] | ||||
Stock option expiration date | Sep. 30, 2030 | |||
Stock option exercise prices | $ 4.84 | |||
Stock option outstanding | 380,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Vehicle Lease [Member] | |
Lease provides for monthly payments | $ 1 |
Remaining lease term | 10 months |
Akron [Member] | |
Lease provides for monthly payments | $ 3 |
Incremental borrowing rate | 14.55% |
Remaining lease term | 26 months |
Litigation (Details Narrative)
Litigation (Details Narrative) $ in Thousands | Mar. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Unpaid commissions | $ 60 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - Definitive Acquisition Agreement [Member] $ in Thousands | May 06, 2021USD ($)shares |
Acquisition percentage | 51.00% |
Due to related party | $ 7,600 |
Cash | $ 5,600 |
Restricted shares | shares | 2,000 |
Option term | P1Y |
Remaining acquired percentage | 49.00% |