Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 01, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2021 | ||
Entity Registrant Name | HERITAGE GLOBAL INC. | ||
Entity Central Index Key | 0000849145 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 36,599,262 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Public Float | $ 72.3 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Entity File Number | 001-39471 | ||
Entity Tax Identification Number | 59-2291344 | ||
ICFR Auditor Attestation Flag | false | ||
Entity Address, Postal Zip Code | 92130 | ||
City Area Code | 858 | ||
Local Phone Number | 847-0659 | ||
Entity Incorporation, State or Country Code | FL | ||
Entity Address, Address Line One | 12625 High Bluff Drive | ||
Entity Address, Address Line Two | Suite 305 | ||
Entity Address, City or Town | San Diego | ||
Entity Address, State or Province | CA | ||
Entity Interactive Data Current | Yes | ||
Title of 12(g) Security | Common stock, $0.01 par value | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Trading Symbol | HGBL | ||
Security Exchange Name | NASDAQ | ||
Documents Incorporated by Reference | Portions of the Registrant’s definitive Proxy Statement for its 2022 Annual Meeting of Stockholders are incorporated by reference into Part III hereof. | ||
Auditor Name | BAKER TILLY US, LLP | ||
Auditor Location | San Diego, California | ||
Auditor Firm ID | 23 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 13,622 | $ 23,385 |
Accounts receivable | 2,732 | 1,496 |
Current portion of notes receivable, net | 2,254 | 1,338 |
Inventory – equipment | 3,220 | 235 |
Other current assets | 1,456 | 498 |
Total current assets | 23,284 | 26,952 |
Non-current portion of notes receivable, net | 1,784 | 748 |
Equity method investments | 4,683 | 2,402 |
Right-of-use asset | 2,694 | 963 |
Property, plant and equipment, net | 1,471 | 130 |
Intangible assets, net | 4,565 | 3,123 |
Goodwill | 7,446 | 5,585 |
Deferred tax assets | 4,488 | 4,402 |
Other assets | 49 | 250 |
Total assets | 50,464 | 44,555 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 11,244 | 13,609 |
Current portion of third party debt | 2,479 | |
Current portion of lease liabilities | 501 | 380 |
Total current liabilities | 14,224 | 13,989 |
Non-current portion of third party debt | 1,352 | |
Non-current portion of lease liabilities | 2,249 | 623 |
Total liabilities | 17,825 | 14,612 |
Commitments and contingencies (Note 13) | ||
Stockholders’ equity: | ||
Preferred stock, $10.00 par value, authorized 10,000,000 shares; issued and outstanding 565 Series N shares at December 31, 2021 and 568 shares at December 31, 2020 | 6 | 6 |
Common stock, $0.01 par value, authorized 300,000,000 shares; issued and outstanding 36,574,702 shares at December 31, 2021 and 35,281,183 shares at December 31, 2020 | 366 | 353 |
Additional paid-in capital | 293,030 | 293,400 |
Accumulated deficit | (260,763) | (263,816) |
Accumulated other comprehensive loss | 0 | 0 |
Total stockholders’ equity | 32,639 | 29,943 |
Total liabilities and stockholders’ equity | $ 50,464 | $ 44,555 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 122,000 | $ 0 |
Preferred stock, par value (in dollars per share) | $ 10 | $ 10 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 565 | 568 |
Preferred stock, shares outstanding | 565 | 568 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common Stock, Shares, Issued | 36,574,702 | 35,281,183 |
Common stock, shares outstanding | 36,574,702 | 35,281,183 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues: | ||
Total revenues | $ 25,792 | $ 26,183 |
Operating costs and expenses: | ||
Selling, general and administrative | 14,811 | 14,449 |
Depreciation and amortization | 460 | 362 |
Total operating costs and expenses | 22,699 | 23,920 |
Earnings of equity method investments | (79) | 3,796 |
Operating income | 3,014 | 6,059 |
Interest and other expense, net | (22) | (45) |
Income before income tax benefit | 2,992 | 6,014 |
Income tax benefit | (61) | (3,644) |
Net income | $ 3,053 | $ 9,658 |
Weighted average common shares outstanding – basic | 35,458,938 | 30,200,053 |
Weighted average common shares outstanding – diluted | 36,901,390 | 32,708,235 |
Net income per share – basic | $ 0.09 | $ 0.32 |
Net income per share – diluted | $ 0.08 | $ 0.30 |
Services Revenue [Member] | ||
Revenues: | ||
Total revenues | $ 19,954 | $ 21,806 |
Operating costs and expenses: | ||
Cost of services revenue and assets sales | 4,499 | 6,320 |
Asset Sales [Member] | ||
Revenues: | ||
Total revenues | 5,838 | 4,377 |
Operating costs and expenses: | ||
Cost of services revenue and assets sales | $ 2,929 | $ 2,789 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Preferred Stock [Member] | Preferred Stock [Member]Series N Preferred Stock [Member] | Common Stock [Member] | Common Stock [Member]Series N Preferred Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] |
Beginning Balance at Dec. 31, 2019 | $ 11,847 | $ 6 | $ 293 | $ 285,099 | $ (273,474) | $ (77) | ||
Balance (in shares) at Dec. 31, 2019 | 568 | 29,339,101 | ||||||
Issuance of common stock from stock option awards | $ (103) | $ 4 | (107) | |||||
Issuance of common stock from stock options awards, shares | 383,350 | 274,582 | ||||||
Issuance of common stock for services rendered | $ 570 | $ 2 | 568 | |||||
Issuance of common stock for services rendered, shares | 205,000 | |||||||
Issuance of common stock in public offering, net | 7,541 | $ 54 | 7,487 | |||||
Issuance of common stock in public offering, net, shares | 5,462,500 | |||||||
Stock-based compensation expense | 353 | 353 | ||||||
Net income | 9,658 | 9,658 | ||||||
Foreign currency translation adjustments | 77 | $ 77 | ||||||
Ending Balance at Dec. 31, 2020 | 29,943 | $ 6 | $ 353 | 293,400 | (263,816) | |||
Balance (in shares) at Dec. 31, 2020 | 568 | 35,281,183 | ||||||
Issuance of common stock from stock option awards | $ (765) | $ 13 | (778) | |||||
Issuance of common stock from stock options awards, shares | 1,895,437 | 1,268,399 | ||||||
Issuance of restricted common stock, shares | 25,000 | |||||||
Issuance of restricted common stock | $ 76 | 76 | ||||||
Issuance of common stock due to conversion of Series N Preferred stock, shares | (3) | 120 | ||||||
Stock-based compensation expense | 332 | 332 | ||||||
Net income | 3,053 | 3,053 | ||||||
Ending Balance at Dec. 31, 2021 | $ 32,639 | $ 6 | $ 366 | $ 293,030 | $ (260,763) | |||
Balance (in shares) at Dec. 31, 2021 | 565 | 36,574,702 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows (used in) provided by operating activities: | ||
Net income | $ 3,053 | $ 9,658 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||
Amortization of deferred issuance costs and fees | 141 | (30) |
Earnings of equity method investments | 79 | (3,796) |
Noncash lease expense | 532 | 520 |
Depreciation and amortization | 460 | 362 |
Deferred taxes | (86) | (4,030) |
Stock-based compensation expense | 408 | 353 |
Non-cash expense related to foreign operations | 0 | 77 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (826) | 363 |
Inventory – equipment | (2,487) | (131) |
Other assets | (749) | 818 |
Accounts payable and accrued liabilities | (3,095) | 5,500 |
Lease liabilities | (61) | (516) |
Net cash (used in) provided by operating activities | (2,631) | 9,148 |
Cash flows (used in) provided by investing activities: | ||
Investment in notes receivable | (8,039) | (6,081) |
Payments received on notes receivable | 3,984 | 1,736 |
Acquisition, net of cash acquired | (4,318) | 0 |
Cash received on transfer of notes receivable to partners | 1,961 | 4,950 |
Investment in equity method investments | (2,603) | (1,428) |
Cash distributions from equity method investments | 243 | 5,338 |
Purchase of property, plant and equipment | (1,425) | (7) |
Net cash (used in) provided by investing activities | (10,197) | 4,508 |
Cash flows provided by financing activities: | ||
Proceeds from debt payable to third parties | 5,248 | 5,625 |
Repayment of debt payable to third parties | (1,417) | (6,063) |
Proceeds from issuance of common stock in public offering, net | 0 | 7,541 |
Proceeds from issuance of common stock from stock option awards | 221 | 66 |
Payments of tax withholdings related to cashless exercises of stock option awards | (987) | (168) |
Net cash provided by financing activities | 3,065 | 7,001 |
Net (decrease) increase in cash and cash equivalents | (9,763) | 20,657 |
Cash and cash equivalents at beginning of year | 23,385 | 2,728 |
Cash and cash equivalents at end of year | 13,622 | 23,385 |
Supplemental cash flow information: | ||
Cash paid for income taxes | 116 | 143 |
Cash paid for interest | 22 | 43 |
Issuance of common stock for services rendered | 0 | 570 |
Noncash change in Right-of-use assets | 2,263 | 0 |
Noncash change in Lease liabilities | $ 2,263 | $ 0 |
Description of Business and Pri
Description of Business and Principles of Consolidation | 12 Months Ended |
Dec. 31, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business and Principles of Consolidation | Note 1 – Description of Business and Principles of Consolidation These consolidated financial statements include the accounts of Heritage Global Inc. together with its subsidiaries, including Heritage Global Partners, Inc. (“HGP”), National Loan Exchange Inc. (“NLEX”), Heritage Global LLC (“HG LLC”), Heritage Global Capital LLC (“HGC”), and Heritage ALT LLC (“ALT”). These entities, collectively, are referred to as “HGI,” the “Company,” “we” or “our” in these consolidated financial statements. These consolidated financial statements were prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”), as outlined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and include the assets, liabilities, revenues, and expenses of all subsidiaries over which HGI exercises control. All significant intercompany accounts and transactions have been eliminated upon consolidation. The Company began its asset liquidation operations in 2009 with the establishment of HG LLC. The business was subsequently expanded by the acquisitions of HGP, NLEX, and ALT in 2012, 2014, and 2021 respectively, and the creation of HGC in 2019. As a result, HGI is positioned to provide an array of value-added capital and financial asset solutions: auction and appraisal services, traditional asset disposition sales, and specialty financing solutions. The Company’s reportable segments consist of both its Financial Assets Division and Industrial Assets Division. COVID-19 The novel coronavirus (“COVID-19”) pandemic had a negative impact on the Company's performance during 2021 due to evolving travel and work restrictions, stimulus payments and credit policies impacting debt sales by financial institutions, and a delay in the typical process for the sale of certain industrial assets by manufacturing companies. Going forward, and subject to the caveat below, the Company does not believe the COVID-19 pandemic will have material negative impacts on its financial performance, as the Company expects that the supply of surplus industrial assets will return to pre-pandemic levels and believes that the continuing disruptions to the global supply chain, particularly those involving industrial assets, will further increase demand for U.S.-based surplus assets. Further, as stimulus payments conclude, the Company expects that the COVID-19 pandemic will have the following positive impacts: • increased activity for NLEX and HGC due to expanding volumes of nonperforming and charged-off consumer loans; • increased funding opportunities for HGC as lenders begin to increase loan volume while loosening underwriting standards, which will subsequently increase loans available to debt buyers of charged-off accounts; and • incremental valuation opportunities for the Company's valuation business as a result of greater focus on collateral on bank balance sheets. Further surges in COVID-19 infection rates could result in the continuation of stimulus payments and the implementation of additional credit policies impacting debt sales that may result in delayed revenues depending on the scope and magnitude of such policies. Public Offering On October 6, 2020, the Company completed a public offering (the “2020 Public Offering”) of 5,462,500 shares of its common stock, at a public offering price of $ 1.75 per share, which included a full exercise of the underwriters’ option to purchase 712,500 additional shares of common stock from the Company. The Company received approximately $ 8.7 million of net proceeds, after deducting underwriting discounts and commissions, but before offering expenses. During 2021, the Company deployed proceeds to fund the ALT acquisition, as well as various principal transactions in both its Financial Assets and Industrial Assets Divisions. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Use of estimates The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant estimates include the assessment of collectability of revenue recognized and the valuation of accounts receivable and notes receivable, inventory, investments, goodwill and intangible assets, liabilities, deferred income tax assets and liabilities including projecting future years’ taxable income, and stock-based compensation. These estimates have the potential to significantly impact our consolidated financial statements, either because of the significance of the financial statement item to which they relate, or because they require judgment and estimation due to the uncertainty involved in measuring, at a specific point in time, events that are continuous in nature. Foreign Currency The functional currency of foreign operations is deemed to be the local country’s currency. Assets and liabilities of operations outside of the United States are generally translated into U.S. dollars, and the effects of foreign currency translation adjustments are included as a component of accumulated other comprehensive income. Reclassifications Certain prior year balances within the consolidated financial statements have been reclassified to conform to current year presentation. Nature of Business The Company earns revenue both from commission or fee-based services, and from the sale of distressed or surplus assets. With respect to the former, revenue is recognized as the services are provided. With respect to the latter, the majority of the asset sale transactions are conducted directly by the Company and the revenue is recognized in the period in which the asset is sold. Fee based revenue is reported as services revenue, and the associated direct costs are reported as cost of services revenue. At the balance sheet date, any unsold assets which the Company owns are reported as inventory, any outstanding accounts receivable are included in the Company’s accounts receivable, and any associated liabilities are included in the Company’s accrued liabilities. Equipment inventory is expected to be sold within a year and is therefore classified as a current asset. The remaining asset sale transactions involve the Company acting jointly with one or more additional purchasers, pursuant to a partnership, joint venture or limited liability company agreement (collectively, “Joint Ventures”). Transactions in which the Company’s ownership share meets the criteria for the equity method investments under ASC Topic 323 – Equity Method and Joint Ventures (“ASC 323”), are accounted for as equity method investments, and, accordingly, the Company’s proportionate share of the net income (loss) is reported as earnings of equity method investments. At each balance sheet date, the Company’s investments in these Joint Ventures are reported in the consolidated balance sheet as equity method investments. Although the Company generally expects to exit each of its investments in Joint Ventures in less than one year, they are classified on the balance sheet as non-current assets due to the uncertainties relating to the timing of resale of the underlying assets as a result of the Joint Venture relationship. The Company monitors the value of the Joint Ventures’ underlying assets and liabilities and records a write down of its investments if the Company concludes that there has been a decline in the value of the net assets. As the activity of the Joint Ventures involves asset purchase/resale transactions, which is similar in nature to the Company’s other asset liquidation activities, the earnings (losses) of the Joint Ventures are included in the operating income in the accompanying consolidated income statements. In 2019, the Company formed Heritage Global Capital LLC (“HGC”), a wholly owned subsidiary of HGI, in order to provide specialty financing solutions to investors in charged-off and nonperforming asset portfolios. Cash and cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains its cash and cash equivalents with financial institutions in the United States. These accounts may from time to time exceed federally insured limits. The Company has not experienced any losses on such accounts. Accounts receivable, net The Company’s accounts receivable primarily relate to the operations of its asset liquidation business. They generally consist of three major categories: (1) fees, commissions and retainers relating to appraisals and auctions, (2) receivables from asset sales, and (3) receivables from Joint Venture partners. The initial value of an account receivable corresponds to the fair value of the underlying goods or services. To date, a majority of the receivables have been classified as current and, due to their short-term nature, any decline in fair value would be due to issues involving collectability. At each financial statement date the collectability of each outstanding account receivable is evaluated, and an allowance is recorded if the book value exceeds the amount that is deemed collectable. See Note 11 for more detail regarding the Company’s accounts receivable. Notes receivable, net The Company’s notes receivable balance consists of loans to buyers of charged-off and nonperforming receivable portfolios, which is considered the only loan category or segment to be reported under the applicable accounting guidance. These loans are measured at historical costs and reported at their outstanding principal balances net of any unamortized deferred fees and costs on originated loans. Loan origination fees and certain direct origination costs are deferred and recognized as adjustments to interest income over the lives of the related loans. As of December 31, 2021, the Company has no t recorded an allowance for credit losses related to notes receivable outstanding. In order to evaluate the need for an adjustment to the receivable balance related to credit losses, or impairment, the Company performs a review of all outstanding loan receivables on a quarterly basis to determine if any indicators exist that suggest the loan will not be fully recoverable. Inventory The Company’s inventory consists of assets acquired for resale, which are normally expected to be sold within a one-year operating cycle. All inventory is recorded at the lower of cost or net realizable value. Employee Retention Credit On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law providing numerous tax provisions and other stimulus measures, including the ERC, which is a refundable tax credit against certain employment taxes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021 extended and expanded the availability of the ERC. As an employer that carried on a trade or business during calendar year 2020 and whose gross receipts were less than 80 % in relation to comparable periods in 2019, the Company is eligible for the refundable ERC under the Cares Act for the quarters ended June 30, 2021 and September 30, 2021. As the Company has incurred certain employment taxes during 2021 and have yet to receive the refundable ERC, the Company has accounted for the credit as a loss recovery under ASC Topic 410, Asset Retirement and Environmental Obligations (by analogy), which indicates that a claim for recovery should be recognized only when the claim is probable as it is defined in ASC Topic 450, Contingencies. The Company has determined that the claim is in alignment with applicable regulatory criteria, the amounts are known and realizable, and refundable ERC is probable. Accordingly, and for the year ended December 31, 2021, the Company recorded a $ 0.6 million receivable classified in other current assets on its consolidated balance sheet and a corresponding reduction to payroll tax expense within selling, general and administrative expense on its consolidated statement of income. Equity Method Investments As noted above, we conduct a portion of our asset liquidation business through Joint Ventures. Transactions in which the Company’s ownership share meets the criteria for the equity method investments under ASC Topic 323 are accounted for using the equity method of accounting whereby our proportionate share of the Joint Venture’s net income (loss) is reported in the consolidated income statement as earnings of equity method investments. At the balance sheet date, our investments in these Joint Ventures are reported in the consolidated balance sheet as equity method investments. We monitor the value of each Joint Ventures’ underlying assets and liabilities and record a write down of our investments should we conclude that there has been a decline in the value of the net assets. Given that the underlying transactions are identical, in all material aspects, to asset liquidation transactions that we undertake independently, the net assets are similarly expected to be sold within a one-year operating cycle. However, these investments have historically been classified as non-current in our consolidated financial statements due to the uncertainties relating to the timing of resale of the underlying assets as a result of the Joint Venture relationship. See Note 6 for further detail. Fair value of financial instruments The fair value of financial instruments is the amount at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. At December 31, 2021 and 2020, the carrying values of the Company’s cash, accounts receivable, other assets, accounts payable and accrued liabilities approximate fair value given the short term nature of these instruments. The Company’s notes receivable and debt obligations approximate fair value as a result of the interest rate on the receivable or debt obligation approximating prevailing market rates. There are three levels within the fair value hierarchy: Level 1 – quoted prices in active markets for identical assets or liabilities; Level 2 – significant other observable inputs; and Level 3 – significant unobservable inputs. At December 31, 2021 and 2020, the Company had no material financial instruments requiring fair value measurement. Business combinations Acquisitions are accounted for under ASC Topic 805, Business Combinations (“ASC 805”), which requires that assets acquired and liabilities assumed that are deemed to be a business are recorded based on their respective acquisition date fair values. ASC 805 further requires that separately identifiable intangible assets be recorded at their acquisition date fair values and that the excess of consideration paid over the fair value of assets acquired and liabilities assumed (including identifiable intangible assets) should be recorded as goodwill. In August 2021 the Company acquired American Laboratory Trading ("ALT") for approximately $ 5.6 million. The Company's purchase price allocation was based on an evaluation of the appropriate fair values and represents management's best estimate. See Note 3 for further detail. Intangible assets Intangible assets are recorded at fair value upon acquisition. Those with an estimated useful life are amortized, and those with an indefinite useful life are unamortized. Subsequent to acquisition, the Company monitors events and changes in circumstances that require an assessment of intangible asset recoverability. Indefinite-lived intangible assets are assessed at least annually to determine both if they remain indefinite-lived and if they are impaired. The Company assesses whether or not there have been any events or changes in circumstances that suggest the value of the asset may not be recoverable. Amortized intangible assets are not tested annually, but are assessed when events and changes in circumstances suggest the assets may be impaired. If an assessment determines that the carrying amount of any intangible asset is not recoverable, an impairment loss is recognized in the income statement, determined by comparing the carrying amount of the asset to its fair value. All of the Company’s identifiable intangible assets at December 31, 2021 have been acquired as part of the acquisitions of HGP in 2012, NLEX in 2014 and ALT in 2021, and are discussed in more detail in Note 10. No impairment charges were necessary during 2021. Goodwill Goodwill, which results from the difference between the purchase price and the fair value of net identifiable tangible and intangible assets acquired in a business combination, is not amortized but, in accordance with GAAP, is tested at least annually for impairment. The Company performs its annual impairment test as of October 1. In testing goodwill, the Company initially uses a qualitative approach and analyzes relevant factors to determine if events and circumstances have affected the value of the goodwill. If the result of this qualitative analysis indicates that the value has been impaired, the Company then applies a quantitative approach to calculate the difference between the goodwill’s recorded value and its fair value. An impairment loss is recognized to the extent that the recorded value exceeds its fair value. Goodwill, in addition to being tested for impairment annually, is tested for impairment at interim periods if an event occurs or circumstances change such that it is more likely than not that the carrying amount of goodwill may be impaired. All of the Company’s goodwill relates to its acquisitions of HGP in 2012, NLEX in 2014 and ALT in 2021, and is discussed in more detail in Note 10. Deferred income taxes The Company recognizes deferred tax assets and liabilities for temporary differences between the tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted tax rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance when necessary to reduce deferred tax assets to the amount expected to be realized. In 2014, as a result of incurring losses in previous years, the Company recorded a valuation allowance against all of its net deferred tax assets. In 2020 the Company recorded a reduction to the valuation allowance resulting in a net deferred tax asset balance of approximately $ 4.4 million as it is more likely than not that some of our net operating loss carryforwards will be utilized. For further discussion of our income taxes, see Note 14. Liabilities and contingencies The Company is involved from time to time in various legal matters arising out of its operations in the normal course of business. On a case by case basis, the Company evaluates the likelihood of possible outcomes for this litigation. Based on this evaluation, the Company determines whether a loss accrual is appropriate. If the likelihood of a negative outcome is probable, and the amount can be reasonably estimated, the Company accounts for the estimated loss in the current period. See Note 16 for further discussion. Revenue recognition In 2018, the Company adopted the accounting standard ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) to all contracts using the modified retrospective method. Services revenue generally consists of commissions and fees from providing auction services, appraisals, brokering of sales transactions, secured lending and providing merger and acquisition advisory services. Asset sales revenue generally consists of proceeds obtained through sales of purchased assets. Revenue is recognized for both services revenue and asset sales revenue based on the ASC 606 standard recognition model, which consists of the following: (1) an agreement exists between two or more parties that creates enforceable rights and obligations, (2) the performance obligations are clearly identified, (3) the transaction price has been determined, (4) the transaction price has been properly allocated to each performance obligation, and (5) the entity satisfies a performance obligation by transferring a promised good or service to a customer for each of the entities. All services and asset sales revenue from contracts with customers is considered to be within the asset liquidation business, which consists of two reportable segments, the Industrial Assets Division and the Financial Assets Division. Generally, revenue is recognized in the asset liquidation business at the point in time in which the performance obligation has been satisfied and full consideration is received. The exception to recognition at a point in time occurs when certain contracts provide for advance payments recognized over a period of time. Services revenue recognized over a period of time is not material in comparison to total revenues ( less than 1 % of total revenues for the year ended December 31, 2021), and therefore not reported on a disaggregated basis. Further, as certain contracts stipulate that the customer make advance payments, amounts not recognized within the reporting period are considered deferred revenue and the Company’s “contract liability”. As of December 31, 2021, the deferred revenue balance was approximately $ 0.5 million. The deferred revenue balance is primarily related to customer deposits on ALT asset sales. The Company records receivables related to asset liquidation in certain situations based on timing of payments for asset liquidation transactions held at the end of the reporting period; however, revenue is generally recognized in the period that the Company satisfies the performance obligation and cash is collected. The Company does not record a “contract asset” for partially satisfied performance obligations. The Company evaluates revenue from asset liquidation transactions in accordance with the accounting guidance to determine whether to report such revenue on a gross or net basis. The Company has determined that it acts as an agent for its fee based asset liquidation transactions and therefore reports the revenue from transactions in which the Company acts as an agent on a net basis. The Company also earns asset liquidation income through asset liquidation transactions that involve the Company acting jointly with one or more additional purchasers, pursuant to a partnership, joint venture or limited liability company (“LLC”) agreement (collectively, “Joint Ventures”). For these transactions, in which the Company’s ownership share meets the criteria for the equity method investments under ASC 323, the Company does not record asset liquidation revenue or expense. Instead, the Company’s proportionate share of the net income (loss) is reported as earnings of equity method investments. In general, the Joint Ventures apply the same revenue recognition and other accounting policies as the Company. In 2019, the Company began providing specialty financing solutions to investors in charged-off and nonperforming asset portfolios. Fees collected in relation to the issuance of loans includes loan origination fees, interest income, portfolio monitoring fees, and a backend profit share percentage related to the underlying asset portfolio. The loan origination fees are offset with any direct origination costs and are deferred upon issuance of the loan and amortized over the lives of the related loans, as an adjustment to interest income. The interest method is used to arrive at a periodic interest cost (including amortization) that will represent a level effective rate on the sum of the face amount of the debt and (plus or minus) the unamortized premium or discount and expense at the beginning of each period. The monitoring fees and the backend profit share are considered a separate earnings process as compared to the origination fees and interest income. Monitoring fees are recorded at the agreed upon rate, and at the moment in which payments are made by the borrower. The backend profit share is recognized in accordance with the agreed upon rate at the time in which the amount is realizable and earned. The recognition policy was established due to the uncertainty of timing of the amount of backend profit share which will be realized, and the lack of historical precedence as this is a new business for the Company. During 2021 and 2020 the Company generated revenues specific to one customer representing 8 % and 10 % of total revenues respectively. Cost of services revenue and asset sales Cost of services revenue generally includes the direct costs associated with generating commissions and fees from the Company’s auction and appraisal services, merger and acquisition advisory services, and brokering of charged-off receivable portfolios. The Company recognizes these expenses in the period in which the revenue they relate to is recorded. Cost of asset sales generally includes the cost of purchased inventory and the related direct costs of selling inventory. The Company recognizes these expenses in the period in which title to the inventory passes to the buyer, and the buyer assumes the risk and reward of the inventory. Stock-based compensation The Company’s stock-based compensation is primarily in the form of options to purchase common shares. The grant date fair value of stock options is calculated using the Black-Scholes option pricing model. The determination of the fair value of the Company’s stock options is based on a variety of factors including, but not limited to, the price of the Company’s common stock, the expected volatility of the stock price over the expected life of the award, and expected exercise behavior. The grant date fair value of the awards is subsequently expensed over the vesting period, net of estimated forfeitures. The provisions of the Company’s stock-based compensation plans do not require the Company to settle any options by transferring cash or other assets, and therefore the Company classifies the option awards as equity. See Note 17 for further discussion of the Company’s stock-based compensation. Advertising The Company expenses advertising costs in the period in which they are incurred. Advertising and promotion expense included in selling, general and administrative expense for the years ended December 31, 2021 and 2020, was $ 0.4 million and $ 0.4 million, respectively. Recently adopted accounting pronouncements In 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes. The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. ASU 2019-12 became effective January 1, 2021 and did not have a material impact on the Company's consolidated financial statements. Future accounting pronouncements In 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (“ASU 2016-13”), which applies a current expected credit loss model which is a new impairment model based on expected losses rather than incurred losses. The expected credit losses, and subsequent adjustments to such losses, will be recorded through an allowance account that is deducted from, or added to, the amortized cost basis of the financial asset, with the net carrying value of the financial asset presented on the consolidated balance sheet at the amount expected to be collected. ASU 2016-13 eliminates the current accounting model for loans and debt securities acquired with deteriorated credit quality under ASC Topic 310-30, Receivables – Loans and Debt Securities Acquired with Deteriorated Credit Quality, which provides authoritative guidance for the accounting of the Company’s notes receivable. With respect to smaller reporting companies, the amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Business Combinations | Note 3 – Business Combinations The Company has determined that the acquisition of certain assets and liabilities of American Laboratory Trading, ("ALT") constitutes a business acquisition as defined by ASC Topic 805, Business Combinations ("ASC 805"). Accordingly, the assets acquired and liabilities assumed in the transaction were recorded at their estimated acquisition fair values, while transaction costs associated with the acquisition were expensed as incurred pursuant to the purchase method of accounting in accordance with ASC 805. The Company’s purchase price allocation was based on an evaluation of the appropriate fair values and represents management’s best estimate based on available data. Fair values are determined based on the requirements of ASC Topic 820, Fair Value Measurement (“ASC 820”). On August 23, 2021, the Company acquired (the “Transaction”) certain assets and liabilities of American Laboratory Trading pursuant to the terms and conditions of an Asset Purchase Agreement (the “Asset Purchase Agreement”), dated August 18, 2021, among the Company, American Laboratory Trading and certain individuals named therein. The aggregate purchase price paid to American Laboratory Trading was approximately $ 5.6 million, consisting of $ 2.3 million in cash, as adjusted for American Laboratory Trading 's working capital, the $ 2.0 million ALT Note and acquired real property of $ 1.3 million. The Asset Purchase Agreement contains customary representations and warranties and covenants by each party. The Company and ALT are obligated, subject to certain limitations, to indemnify the other under the Asset Purchase Agreement for losses arising from certain breaches of the Asset Purchase Agreement and for certain other liabilities, subject to applicable limitations set forth in the Asset Purchase Agreement. HGI has guaranteed the obligations of ALT under the terms of the Asset Purchase Agreement and the ALT Note. On August 23, 2021, in connection with the Transaction, a wholly-owned subsidiary of HGI (“RE Purchaser”), acquired the real property used in ALT’s business (the “Property”) pursuant to a Purchase and Sale Agreement (the “Real Estate Purchase Agreement” and together with the Purchase Agreement, the “Agreements”), dated August 18, 2021, between 12 Colton Road, LLC and RE Purchaser. The purchase price for the Property was $ 1.3 million. The Real Estate Purchase Agreement contains customary representations and warranties and covenants by each party. The parties to the Real Estate Purchase Agreement are obligated, subject to certain limitations, to indemnify the other under the Real Estate Purchase Agreement for losses arising from certain breaches of the Real Estate Purchase Agreement and other liabilities, subject to applicable limitations set forth in the Real Estate Purchase Agreement. ALT is a supplier of refurbished lab equipment and a provider of surplus asset services for the life sciences industry. The acquisition enhances the Company’s position in the biotech sector. Acquisition-related costs consisted of external fees for advisory, legal, and other professional services and totaled approximately $ 0.2 million for the year ended December 31, 2021, respectively. The major classes of assets and liabilities to which the Company has allocated the purchase price were as follows (in thousands): Accounts receivable $ 410 Inventory - equipment 498 Property, plant and equipment 1,315 Intangible assets 1,800 Goodwill 1,861 Other assets 8 Accounts payable and accrued liabilities ( 274 ) Purchase price $ 5,618 The $ 1.8 million of intangible assets are attributable to $ 1.2 million of vendor relationships that will be amortized over a period of five years and $ 0.7 million for the American Laboratory Trading trade name, which will be amortized over a period of 20 years . The Company made certain adjustments to the purchase price allocation during the fourth quarter of 2021, which primarily include an increase to separately identifiable intangible assets of $ 0.4 million and a decrease to the fair value of acquired inventory of $ 0.6 million. The excess of the consideration transferred over the fair values of assets acquired and liabilities assumed was recorded as goodwill, which was primarily attributed to increased synergies that are expected to be achieved from the acquisition. Goodwill is expected to be deductible for income tax purposes. The financial results of ALT have been included in the Company's consolidated financial statements since the date of the acquisition and have been reported as part of the Company's Industrial Assets Division. Unaudited Pro Forma Financial Information The unaudited pro forma financial information presented in the table below (in thousands) is provided for illustrative purposes only and summarizes the combined results of operations of the Company and ALT. For purposes of this pro forma presentation, the acquisition of ALT is assumed to have occurred on January 1, 2020. The pro forma financial information for all periods presented also includes the estimated business combination accounting effects resulting from this acquisition, notably amortization expense from the acquired intangible assets, interest expense from the ALT Note, and certain other integration related impacts. This unaudited pro forma financial information should not be relied upon as being indicative of the historical results that would have been obtained if the acquisition had actually occurred on January 1, 2020, nor of the results of operations that may be obtained in the future. For the Year Ended December 31, 2021 2020 Pro forma revenues $ 29,788 $ 32,082 Pro forma net income $ 3,285 $ 10,296 Pro forma net income per share - basic $ 0.09 $ 0.34 Pro forma net income per share - diluted $ 0.09 $ 0.31 |
Notes Receivable, Net
Notes Receivable, Net | 12 Months Ended |
Dec. 31, 2021 | |
Receivables [Abstract] | |
Notes Receivable, net | Note 4 – Notes Receivable, net The Company’s notes receivable balance consists of loans to buyers of charged-off and nonperforming receivable portfolios which resulted in a total outstanding principal balance of approximatel y $ 4.0 million, net of unamortized deferred fees and costs on originated loans. The activity during 2021 includes the issuance of additional notes of approximately $ 8.0 million, principal payments made by borrowers of approximately $ 4.0 million, the transfer of notes to the Company's joint venture, HGC Funding I LLC and Origination I LLC, of approximately $ 2.0 million, and adjustments to the deferred fees and costs balance of approximately $ 0.1 million. The table below shows the Company’s lending activity during 2021 and 2020: 2021 2020 Notes receivable, beginning of year $ 2,079 $ 2,685 Loan originations 8,039 6,081 Transfer of notes ( 1,961 ) ( 4,951 ) Principal repayments ( 3,985 ) ( 1,736 ) Notes receivable, end of year 4,172 2,079 Deferred financing fees and costs, net ( 134 ) 7 Notes receivable, net, end of year $ 4,038 $ 2,086 As of December 31, 2021, the Company has no t recorded an allowance for credit losses related to notes receivable outstanding. |
Lessor Arrangement
Lessor Arrangement | 12 Months Ended |
Dec. 31, 2021 | |
Lessor Disclosure [Abstract] | |
Lessor Arrangement | Note 5 – Lessor Arrangement In June 2019, the Company, with certain partners, entered into agreements to lease, with a purchase option, a fully functional manufacturing building, including all machinery and equipment held within. The assets under lease relate to the Company’s purchase, with certain partners, of a pharmaceutical campus in Huntsville, Alabama, which was finalized in the fourth quarter of 2018. The lessee is obligated to make monthly lease payments over a ten year period, totaling approximately $ 13.2 million for the real estate portion, and monthly lease payments over a six year period totaling approximately $ 9.7 million for the machinery and equipment. The lessor arrangement is classified as a sales-type lease, and, therefore, the present value of future lease payments has been recognized as revenue and a lease receivable as of the effective date. The real estate portion of the arrangement is held by CPFH LLC, the joint venture, and is accounted for under the equity method where the Company’s share in earnings from equity method investments is shown in one line item on the income statement. Refer to Note 6 for further information. The machinery and equipment portion of the arrangement is jointly owned by all the partners of CPFH LLC, apart from the joint venture entity. Therefore, the Company has derecognized the leased asset of approximately $ 0.9 million and recognized as revenue approximately $ 1.2 million, which represents the present value of future lease payments and a lease receivable included in the accounts receivable line item on the balance sheet, consistent and reflective of its business model for asset sales. The purchase option for both the real estate and machinery and equipment was expected to be exercised at any time on or after December 1, 2019 and before May 31, 2021 for a total purchase price of $ 20.0 million; of which $ 12.0 million and $ 8.0 million are allocated to the real estate and machinery and equipment, respectively. On May 31, 2021, the lessee delivered written notice to exercise the purchase option. The lessee confirmed that its intention was to exercise the option, however, was unable to complete the transaction as of December 31, 2021. As the classification of the lease remains a sales-type lease, CPFH LLC has not recorded a gain or loss as a result of the modification. |
Equity Method Investments
Equity Method Investments | 12 Months Ended |
Dec. 31, 2021 | |
Equity Method Investments And Joint Ventures [Abstract] | |
Equity Method Investments | Note 6 – Equity Method Investments In November 2018, CPFH LLC was formed to purchase certain real estate assets among partners in a Joint Venture. The Company’s share of the Joint Venture is 25 %. In March 2019, Oak Grove Asset Acquisitions LP was formed for the execution of auction deals with Napier Park, of which the Company holds a 50 % share. In March 2020 HGC Origination I LLC and HGC Funding I LLC were formed as joint ventures with a partner for purposes of conducting business relating to the sourcing, origination and funding of loans to debt purchasing clients. The table below details the Company’s Joint Venture revenues and earnings during 2021 and 2020 (in thousands): 2021 2020 Revenues: Oak Grove Asset Acquisitions LP $ 5 $ 1,129 CPFH LLC 473 15,538 HGC Funding I LLC and Origination I LLC 238 761 Total Revenues $ 716 $ 17,428 Operating income: Oak Grove Asset Acquisitions LP $ 4 $ 237 CPFH LLC ( 548 ) 13,930 HGC Funding I LLC and Origination I LLC 212 689 Total operating (loss) income $ ( 332 ) $ 14,856 The table below details the summarized components of assets and liabilities, as at December 31, 2021 and 2020, of the Company’s Joint Ventures at those dates (in thousands): 2021 2020 Assets: Oak Grove Asset Acquisitions LP $ — $ — CPFH LLC 11,789 10,791 HGC Funding I LLC and Origination I LLC 10,476 — Total assets $ 22,265 $ 10,791 Liabilities: Oak Grove Asset Acquisitions LP $ — $ 1 CPFH LLC 6,099 5,374 HGC Funding I LLC and Origination I LLC — — Total liabilities $ 6,099 $ 5,375 |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 7 – Earnings per Share The Company is required, in periods in which it has net income, to calculate basic earnings per share (“basic EPS”) using the two-class method. The two-class method is required because the Company’s shares of Series N preferred stock, each of which is convertible to 40 common shares, have the right to receive dividends or dividend equivalents should the Company declare dividends on its common stock. Under the two-class method, earnings for the period are allocated on a pro-rata basis to the common and preferred stockholders. The weighted-average number of common and preferred shares outstanding during the period is then used to calculate basic EPS for each class of shares. In periods in which the Company has a net loss, basic loss per share is calculated by dividing the loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. The two-class method is not used in periods in which the Company has a net loss because the preferred stock does not participate in losses. Stock options and other potential common shares are included in the calculation of diluted earnings per share (“diluted EPS”), since they are assumed to be exercised or converted, except when their effect would be anti-dilutive. The table below shows the calculation of the shares used in computing diluted EPS: December 31, December 31, Weighted Average Shares Calculation: 2021 2020 Basic weighted average shares outstanding 35,458,938 30,200,053 Treasury stock effect of common stock options and restricted stock awards 1,442,452 2,508,182 Diluted weighted average common shares outstanding 36,901,390 32,708,235 For 2021 and 2020 there were potential common shares totaling approximately 0.3 million and 0.1 million, respectively, that were excluded from the computation of diluted EPS as the inclusion of such shares would have been anti-dilutive. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 8 – Leases The Company leases office and warehouse space primarily in three locations: Del Mar, CA; Hayward, CA; and Edwardsville, IL. In connection with the Burlingame lease termination, which took effect on April 30, 2021 , the Company executed a new warehouse lease in Hayward, CA with an effective date of April 1, 2021 . As each contract does not meet any of the four criteria of ASC Topic 842, Leases, for financing lease classification, the Company has determined that each lease arrangement should be classified as an operating lease. The right-of-use assets and lease liabilities for each location are as follows (in thousands): Right-of-use assets: December 31, December 31, Del Mar, CA $ 477 $ 613 Hayward, CA 2,064 — Burlingame, CA — 99 Edwardsville, IL 153 251 $ 2,694 $ 963 Lease liabilities: December 31, December 31, Del Mar, CA $ 506 $ 641 Hayward, CA 2,089 — Burlingame, CA — 109 Edwardsville, IL 155 253 $ 2,750 $ 1,003 The Company’s leases generally do not provide an implicit rate, and, therefore, the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. The Company used its incremental borrowing rate as of January 1, 2019 for operating leases that commenced prior to that date. As of January 1, 2019, the Company’s incremental borrowing rate was 5.25 %. For leases commencing after January 1, 2019, the Company uses its incremental borrowing rate at time of commencement. As of April 1, 2021, the Company’s incremental borrowing rate was 4.95 %. Lease expense for these leases is recognized on a straight-line basis over the lease term. For 2021 and 2020, lease expense was approximately $ 0.5 million and $ 0.6 million, respectively. Undiscounted future minimum lease commitments as of December 31, 2021 that have initial or remaining lease terms in excess of one year are as follows (in thousands): 2022 $ 612 2023 563 2024 532 2025 396 2026 377 Thereafter 687 Total undiscounted future minimum lease payments 3,167 Less: imputed interest ( 417 ) Present value of lease liabilities $ 2,750 |
Property and Equipment, net
Property and Equipment, net | 12 Months Ended |
Dec. 31, 2021 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment, net | Note 9 – Property, Plant and Equipment, net Property, plant and equipment are recorded at historical cost. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives on a straight-line basis. The life of the building acquired in connection of the ALT purchase transaction was determined to be 25 years. Leasehold improvements are amortized over the useful life of the asset or the lease term, whichever is shorter. Estimated service lives are five years for furniture, fixtures and office equipment and three years for software and technology assets. Expenditures for repairs and maintenance not considered to substantially lengthen the life of the asset or increase capacity or efficiency are charged to expense as incurred. The following summarizes the components of the Company’s property, plant and equipment (in thousands): December 31, December 31, Building $ 985 $ — Land 397 — Furniture, fixtures and office equipment 97 203 Software and technology assets 84 340 Vehicles 11 — 1,574 543 Accumulated depreciation ( 103 ) ( 413 ) Property, plant and equipment, net $ 1,471 $ 130 Depreciation expense related to property, plant and equipment was $ 102,000 and $ 94,000 for the years ended December 31, 2021 and 2020, respectively. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Note 10 – Intangible Assets and Goodwill Intangible assets The details of identifiable intangible assets as of December 31, 2021 and 2020 are shown below (in thousands except for lives): Amortized Intangible Assets Original Remaining Carrying Intangible Amortization Carrying 31, Customer Relationships (HGP) 12 1.0 $ 62 $ — $ ( 32 ) $ 30 Trade Name (HGP) 14 3.0 513 — ( 128 ) 386 Customer Relationships (NLEX) 7.6 — 111 — ( 110 ) — Vendor Relationships (ALT) 5 4.7 — 1,150 ( 77 ) 1,073 Trade Name (ALT) 20 19.7 — 650 ( 11 ) 639 Total 686 1,800 ( 358 ) 2,128 Unamortized Intangible Assets Trade Name (NLEX) N/A N/A 2,437 — — 2,437 Total $ 3,123 $ 1,800 $ ( 358 ) $ 4,565 Amortized Intangible Assets Original Remaining Carrying Intangible Amortization Carrying Customer Relationships (HGP) 12 2.0 $ 92 $ — $ ( 30 ) $ 62 Trade Name (HGP) 14 4.0 642 — ( 129 ) 513 Customer Relationships (NLEX) 7.6 1 221 — ( 110 ) 111 Total 955 — ( 269 ) 686 Unamortized Intangible Assets Trade Name (NLEX) N/A N/A 2,437 — — 2,437 Total $ 3,392 $ — $ ( 269 ) $ 3,123 Amortization expense during each of 2021 and 2020 was $ 0.4 million and $ 0.3 million, respectively. No significant residual value is estimated for these intangible assets. The Company performed its annual impairment test for the year ended December 31, 2021, in the fourth quarter, and determined that no impairment charges were necessary. The estimated amortization expense during future years is shown below (in thousands): Year Amount 2022 $ 421 2023 391 2024 391 2025 262 2026 186 Thereafter 477 Total $ 2,128 Goodwill As part of its acquisitions, the Company recognized goodwill of $ 2.0 million related to HGP in 2012, $ 3.5 million related to NLEX in 2014, and $ 1.9 million related to ALT in 2021. Goodwill consisted of the following at December 31, 2021 and 2020 (in thousands): Acquisition December 31, December 31, HGP 2,040 2,040 NLEX 3,545 3,545 ALT 1,861 — Total goodwill $ 7,446 $ 5,585 The Company performed its annual impairment test for the year ended December 31, 2021, in the fourth quarter, and determined that no additional impairment charges were necessary. |
Accounts Receivable and Account
Accounts Receivable and Accounts Payable | 12 Months Ended |
Dec. 31, 2021 | |
Accounts Receivable And Accounts Payable [Abstract] | |
Accounts Receivable and Accounts Payable | Note 11 – Accounts Receivable and Accounts Payable Accounts receivable, net As described in Note 2, the Company’s accounts receivable are primarily related to the operations of its asset liquidation business. With respect to auction proceeds and asset dispositions, including NLEX’s accounts receivable brokerage transactions, the assets are not released to the buyer until payment has been received. The Company, therefore, is not exposed to significant collectability risk relating to these receivables. Given this experience, together with the ongoing business relationships between the Company and its joint venture partners, the Company has not historically required a formal credit quality assessment in connection with these activities. The Company has not experienced any significant collectability issues with its accounts receivable. As the Company’s asset liquidation business expands, more comprehensive credit assessments may be required. The Company's allowance for doubtful accounts was approximately $ 122,000 and $ 0 as of December 31, 2021 and 2020, respectively. Accounts payable and accrued liabilities Accounts payable and accrued liabilities consisted of the following at December 31, 2021 and 2020 (in thousands): 2021 2020 Due to auction clients $ 6,433 $ 8,026 Remuneration and benefits 1,909 2,498 Due to Joint Venture partners 402 1,349 Sales and other taxes 226 831 Accrued asset liquidation expenses 1,340 346 Accounting, auditing and tax consulting 184 166 Customer deposits 407 — Other 343 393 Total accounts payable and accrued liabilities $ 11,244 $ 13,609 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Note 12 – Debt Outstanding debt is summarized as follows (in thousands): December 31, December 31, Current Third party debt $ 2,479 $ — Non-current: Third party debt 1,352 — Total debt $ 3,831 $ — On February 10, 2020, the Company entered into a secured promissory note, business loan agreement, commercial security agreement and agreement to provide insurance (the “2020 Credit Facility”) with C3bank, National Association for a $ 5.0 million revolving line of credit. The 2020 Credit Facility matured on April 5, 2021 . Under the terms of the 2020 Credit Facility, the Company was permitted to use the proceeds of the loan solely for its business operations. The 2020 Credit Facility accrued at a variable interest rate, which was equal to the rate of interest last quoted by The Wall Street Journal as the “prime rate,” not to be less than 5.50 % per annum. The Company paid interest on the 2020 Credit Facility in regular monthly payments, beginning on March 5, 2020. The Company could prepay the 2020 Credit Facility without penalty. The 2020 Credit Facility was secured by a first priority security interest in certain of the Company’s and its certain subsidiaries’ current and future tangible and intangible assets, inventory, chattel paper, accounts, equipment and general intangibles. The availability of additional draws under the 2020 Credit Facility was conditioned, among other things, on the compliance with certain customary representations and warranties, including default, insolvency or bankruptcy, material adverse change in financial condition and any guarantor’s attempt to revise its guarantee. The agreement governing the 2020 Credit Facility also contained customary affirmative covenants regarding, among other things, the maintenance of records, maintenance of certain insurance coverage, compliance with governmental requirements and maintenance of a debt to equity ratio. The 2020 Credit Facility contained certain customary financial covenants and negative covenants that, among other things, include restrictions on the Company’s ability to create, incur or assume indebtedness for borrowed money, including capital leases or to sell, transfer, mortgage, assign, pledge, lease, grant a security interest in, or encumber any of the Company’s assets. During the year ended December 31, 2020, the Company drew on the line of credit for a total of $ 5.6 million and made repayments of principal totaling $ 5.6 million resulting in a zero balance as of December 31, 2020. On May 11, 2021, the Company entered into a promissory note, business loan agreement, commercial security agreement and pledge agreement (the “2021 Credit Facility”) with C3bank, National Association for a $ 10.0 million revolving line of credit. The 2021 Credit Facility matures on May 11, 2023 and replaces the 2020 Credit Facility. The Company is permitted to use the proceeds of the loan solely for its business operations. The 2021 Credit Facility accrues at a variable interest rate, which is based on the rate of interest last quoted by The Wall Street Journal as the “prime rate,” plus a margin of 1.70 % (such rate not to be less than 4.950 % per annum). The Company pays interest on the 2021 Credit Facility in regular monthly payments, which began on June 11, 2021. The 2021 Credit Facility also provides for a minimum fee, which is offset by interest payments. The Company may prepay the 2021 Credit Facility without penalty and may convert up to $ 5.0 million of revolving debt into term debt. The Company is the borrower under the 2021 Credit Facility. The 2021 Credit Facility is secured by a security interest in certain of the Company’s and its certain subsidiaries’ current and future tangible and intangible assets, inventory, chattel paper, accounts, equipment and general intangibles and a pledge of the equity of the direct and indirect subsidiaries of the Company. The availability of additional draws under the 2021 Credit Facility is conditioned, among other things, on the compliance with certain customary representations and warranties, including default, insolvency or bankruptcy, material adverse change in financial condition and any guarantor’s attempt to revise its guarantee. The agreement governing the 2021 Credit Facility also contains customary affirmative covenants regarding, among other things, the maintenance of records, maintenance of certain insurance coverage, compliance with governmental requirements and maintenance of several financial covenants. The 2021 Credit Facility contains certain customary financial covenants and negative covenants that, among other things, include restrictions on the Company’s ability to create, incur or assume indebtedness for borrowed money, including capital leases or to sell, transfer, mortgage, assign, pledge, lease, grant a security interest in, or encumber any of the Company’s assets. On May 11, 2021, the Company terminated the 2020 Credit Facility as a result of entry into the 2021 Credit Facility. During 2021, the Company drew on the line of credit for a total of $ 3.2 million and made repayments of principal totaling $ 1.3 million resulting in a balance of $ 1.9 million as of December 31, 2021. On August 23, 2021, the Company entered into a $ 2.0 million subordinated promissory note with an interest rate of 3 % per annum and a maturity date of August 23, 2025 (the “ALT Note”) as part of the aggregate purchase price paid to acquire certain assets and liabilities of American Laboratory Trading. The ALT Note requires 48 equal installments of approximately $ 44,000 on the first day of each month, beginning the next month succeeding the closing date of August 23, 2021 with the final payment due on August 23, 2025. The outstanding balance of the ALT Note as of December 31, 2021, was $ 1.9 million. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13 – Commitments and Contingencies At December 31, 2021 HGI does not expect any potential contingent liabilities, individually or in the aggregate, to have a material adverse effect on its assets or results of operations. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 14 – Income Taxes In 2014 the Company recorded a valuation allowance against its deferred tax assets, reducing the carrying value of those assets to zero as a result of historical losses. The following table summarizes the change in the valuation allowance during 2020 and 2021 (in thousands): Balance at December 31, 2019 $ 17,639 Change during 2020 ( 4,542 ) Balance at December 31, 2020 13,097 Change during 2021 ( 855 ) Balance at December 31, 2021 $ 12,242 As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. At December 31, 2020, the Company recorded a reduction to the valuation allowance based on the potential utilization of net operating loss carryforwards in future periods. At December 31, 2021, no additional reduction of the valuation allowance was determined necessary related to the potential utilization of net operating loss carryforwards in future periods, however a reduction of the valuation allowance was made related to the potential realization of certain state net operating loss carryforwards. At December 31, 2021 the Company has aggregate tax net operating loss carry forwards of approximately $ 77.8 million ($ 62.2 million of unrestricted net operating tax losses and approximately $ 15.6 million of restricted net operating tax losses). Substantially all of the net operating loss carry forwards and unused minimum tax credit carry forwards expire between 2024 and 2037. The reported tax expense varies from the amount that would be provided by applying the statutory U.S. Federal income tax rate to the income before income tax expense for the following reasons in each of the years ended December 31 (in thousands): 2021 2020 Expected federal statutory tax expense $ 628 $ 1,263 Increase (reduction) in taxes resulting from: State income taxes recoverable 43 388 Non-deductible expenses (permanent differences) ( 707 ) ( 193 ) Change in valuation allowance ( 855 ) ( 4,542 ) Tax rate changes 876 ( 599 ) Other ( 46 ) 39 Income tax benefit $ ( 61 ) $ ( 3,644 ) The Company’s utilization of restricted net operating tax loss carry forwards against future income for tax purposes is restricted pursuant to the “change in ownership” rules in Section 382 of the Internal Revenue Code. These rules, in general, provide that an ownership change occurs when the percentage shareholdings of 5% direct or indirect stockholders of a loss corporation have, in aggregate, increased by more than 50 percentage points during the immediately preceding three years. Restrictions in net operating loss carry forwards occurred in 2001 as a result of the acquisition of the Company by Street Capital. Pursuant to Section 382 of the Internal Revenue Code, the annual usage of the Company’s net operating loss carry forwards was limited to approximately $2.5 million per annum until 2008 and $1.7 million per annum thereafter. There is no certainty that the application of these “change in ownership” rules may not recur, resulting in further restrictions on the Company’s income tax loss carry forwards existing at a particular time. In addition, further restrictions, reductions in, or expiration of net operating loss and net capital loss carry forwards may occur through future merger, acquisition and/or disposition transactions or failure to continue a significant level of business activities. Any such additional limitations could require the Company to pay income taxes on its future earnings and record an income tax expense to the extent of such liability, despite the existence of such tax loss carry forwards. All loss taxation years remain open for audit pending the application of the respective tax losses against income in a subsequent taxation year. In general, the statute of limitations expires three years from the date that a company files a tax return applying prior year tax loss carry forwards against income for tax purposes in the later year. The 2018 through 2020 taxation years remain open for audit. The Company is subject to state income tax in multiple jurisdictions. In most states, the Company does not have tax loss carry forwards available to shield income attributable to a particular state from being subject to tax in that particular state. The components of the net deferred tax assets as of December 31, 2021 and 2020 are as follows in (thousands): 2021 2020 Net operating loss carry forwards $ 16,824 $ 17,623 Stock based compensation 1,095 1,007 Trade names and customer relationships ( 741 ) ( 805 ) Equity method investments ( 477 ) ( 478 ) Other 29 152 Gross deferred tax assets 16,730 17,499 Less: valuation allowance ( 12,242 ) ( 13,097 ) Deferred tax assets, net of valuation allowance $ 4,488 $ 4,402 As a result of the acquisition of NLEX in 2014, and the recognition of an indefinite-lived intangible asset in the amount of $ 2.4 million related to the NLEX trade name, the Company is required to record a non-current deferred tax liability in the amount of $ 0.6 million. The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. There have been no significant impacts to the Corporation's provision for income taxes in 2021 as a result of the CARES Act legislation. Uncertain Tax Positions The accounting for uncertainty in income taxes requires a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. Upon adoption of this principle in 2007, the Company derecognized certain tax positions that, upon examination, more likely than not would not have been sustained as a recognized tax benefit. As a result of derecognizing uncertain tax positions, the Company has recorded a cumulative reduction in its deferred tax assets of approximately $ 4.4 million associated with prior years’ tax benefits, which are not expected to be available primarily due to change of control usage restrictions, and a reduction in the rate of the tax benefit associated with all of its tax attributes. Due to the Company’s historic policy of applying a valuation allowance against its deferred tax assets, the effect of the above was an offsetting reduction in the Company’s valuation allowance. Accordingly, the above reduction had no net impact on the Company’s financial position, operations or cash flow. As of December 31, 2021, the total unrecognized tax benefit has been determined to be $ 4.5 million. In the unlikely event that these tax benefits are recognized in the future, the amount recognized at that time should result in a reduction in the Company’s effective tax rate. The Company’s policy is to recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. Because the Company has tax loss carry forwards in excess of the unrecognized tax benefits, the Company did not accrue for interest and penalties related to unrecognized tax benefits either upon the initial derecognition of uncertain tax positions or in the current period. It is possible that the total amount of the Company’s unrecognized tax benefits will significantly increase or decrease within the next 12 months. These changes may be the result of future audits, the application of “change in ownership” rules leading to further restrictions in tax losses arising from changes in the capital structure of the Company, reductions in available tax loss carry forwards through future merger, acquisition and/or disposition transactions, failure to continue a significant level of business activities, or other circumstances not known to management at this time. At this time, an estimate of the range of reasonably possible outcomes cannot be made. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 15 – Related Party Transactions As part of the operations of NLEX, the Company leases office space in Edwardsville, IL that is owned by the President of NLEX, David Ludwig. The total amount paid to the related party was approximately $ 110,000 for both years ended December 31, 2021 and 2020, and is included in selling, general and administrative expenses in the consolidated income statement. All of the payments in both 2021 and 2020 were made to David Ludwig. |
Legal Proceedings
Legal Proceedings | 12 Months Ended |
Dec. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Legal Proceedings | Note 16 – Legal Proceedings The Company is involved in various legal matters arising out of its operations in the normal course of business, none of which are expected, individually or in the aggregate, to have a material adverse effect on the Company. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Note 17 – Stockholders’ Equity Capital Stock The Company’s authorized capital stock consists of 300,000,000 common shares with a par value of $ 0.01 per share and 10,000,000 preferred shares with a par value of $ 10.00 per share. On October 6, 2020, the Company completed a public offering (the “2020 Public Offering”) of 5,462,500 shares of its common stock, at a public offering price of $ 1.75 per share, which included a full exercise of the underwriters’ option to purchase 712,500 additional shares of common stock from the Company. The Company received approximately $ 8.7 million of net proceeds, after deducting underwriting discounts and commissions, but before offering expenses. During 2021, the Company deployed proceeds to fund the ALT acquisition, as well as various principal transactions in both its Financial Assets and Industrial Assets Divisions. During 2021 and 2020 the Company issued 1,268,399 and 274,582 shares of common stock, respectively, pursuant to the exercise of stock options. In connection with an agreement entered on November 25, 2019, the Company issued 205,000 common shares to Maxim Group LLC for services rendered during 2020. On March 30, 2021, the Company and Scott West entered into a Separation Agreement and General Release (the “Separation Agreement”). Under the terms of the Separation Agreement, Mr. West’s separation from the Company was effective on March 31, 2021. On April 8, 2021, the Company granted 25,000 shares of the Company’s restricted common stock, which will be forfeited to the Company during the two years following the effective date of the Separation Agreement in the event Mr. West breaches the terms of the Separation Agreement. In addition, the Separation Agreement provides for customary mutual releases by the Company and Mr. West, and the Separation Agreement includes confidentiality, non-disparagement and other obligations. The full amount of the restricted common stock was expensed as of March 31, 2021 and there was no remaining unrecognized stock-based compensation expense as of December 31, 2021. Each share of Series N preferred stock has a voting entitlement equal to 40 common shares, votes with the common stock on an as-converted basis and is senior to all other preferred stock of the Company. Dividends, if any, will be paid on an as-converted basis equal to common stock dividends. The conversion value of each share of Series N preferred stock is $ 1,000 , and each share is convertible to 40 common shares at the rate of $ 25.00 per common share. The holders of shares of Series N preferred stock are entitled to liquidation preference over common stockholders equivalent to $1,000 per share. During 2021, three shares of the Company’s Series N preferred stock were converted into 120 shares of the Company’s common stock. During 2020, no shares of the Company’s Series N preferred stock were converted into shares of the Company’s common stock. Stock-Based Compensation Plans At December 31, 2021, the Company had four stock-based compensation plans which are described below. The fourth of these plans was adopted on May 5, 2016, and received approval from the Company’s stockholders at the special meeting of stockholders held on September 14, 2016. 2003 Stock Option and Appreciation Rights Plan In 2003, the stockholders of the Company approved the 2003 Stock Option and Appreciation Rights Plan (the “2003 Plan”) which provided for the issuance of incentive stock options, non-qualified stock options and Stock Appreciation Rights (“SARs”) up to an aggregate of 2,000,000 shares of common stock (subject to adjustment in the event of stock dividends, stock splits, and other similar events). The plan had a ten-year term, and therefore after 2013 no options have been issued. The price at which shares of common stock covered by the option can be purchased was determined by the Company’s Board or a committee thereof; however, in the case of incentive stock options the exercise price was never less than the fair market value of the Company’s common stock on the date the option was granted. 2003 Plan 2021 2020 Options outstanding, beginning of year — 20,000 Options expired — ( 20,000 ) Options outstanding, end of year — — No SARs were issued under the 2003 Plan. 2010 Non-Qualified Stock Option Plan In 2010, the Company’s Board approved the 2010 Non-Qualified Stock Option Plan (the “2010 Plan”) to induce certain key employees of the Company or any of its subsidiaries who are in a position to contribute materially to the Company’s prosperity to remain with the Company, to offer such persons incentives and rewards in recognition of their contributions to the Company’s progress, and to encourage such persons to continue to promote the best interests of the Company. The Company reserved 1,250,000 shares of common stock (subject to adjustment under certain circumstances) for issuance or transfer upon exercise of options granted under the 2010 Plan. Options may be issued under the 2010 Plan to any key employees or consultants selected by the Company’s Board (or an appropriately qualified committee). Options may not be granted with an exercise price less than the fair market value of the common stock of the Company as of the day of the grant. Options granted pursuant to the plan are subject to limitations on transfer and execution and may be issued subject to vesting conditions. Options may also be forfeited in certain circumstances. During 2021 and 2020 options to purchase 50,000 and 60,000 shares respectively were granted to the Company’s independent directors as part of their annual compensation. During 2020, options to purchase 50,000 shares were granted to newly appointed independent directors. Also during 2020, the Company issued options to purchase 15,000 shares of common stock to an outside consultant. 2010 Plan 2021 2020 Options outstanding, beginning of year 1,100,000 975,000 Options granted 50,000 125,000 Options exercised ( 793,750 ) — Options forfeited ( 25,000 ) — Options outstanding, end of year 331,250 1,100,000 The outstanding options vest over four years at exercise prices ranging from $ 0.24 to $ 2.85 per share. Other Options Issued In 2012, the Company’s Board approved the issuance of options for 625,000 shares of common stock. The options expired during 2019. In 2021, the Company’s Board approved the issuance of options to purchase 150,000 shares at an exercise price of $ 1.78 to certain accredited personnel. In 2020, the Company’s Board approved the issuance of options to purchase 90,000 shares at an exercise price of $ 1.41 to certain accredited personnel. Other Options 2021 2020 Options outstanding, beginning of year 344,375 265,000 Options issued 150,000 90,000 Options exercised ( 22,500 ) ( 10,625 ) Options forfeited ( 67,500 ) — Options outstanding, end of year 404,375 344,375 Heritage Global Inc. 2016 Stock Option Plan In 2016, the Company adopted the Heritage Global Inc. 2016 Stock Option Plan (the “2016 Plan”) which provided for the issuance of incentive stock options and non-qualified stock options up to an aggregate of 3,150,000 shares of common stock (subject to adjustment in the event of stock dividends, stock splits, and other similar events). Options may not be granted with an exercise price less than the fair market value of the common stock of the Company as of the day of the grant. Options granted pursuant to the plan are subject to limitations on transfer and execution and may be issued subject to vesting conditions. Options may also be forfeited in certain circumstances. During 2016 options to purchase 2,539,200 shares of common stock were granted to the Company’s employees. During 2021 and 2020, options to purchase a total of 522,500 and 259,750 shares, respectively, were granted to the Company’s employees under the 2016 Plan. 2016 Plan 2021 2020 Options outstanding, beginning of year 2,071,850 2,351,850 Options granted 522,500 259,750 Options exercised ( 1,079,187 ) ( 372,725 ) Options forfeited ( 57,500 ) ( 167,025 ) Options outstanding, end of year 1,457,663 2,071,850 The outstanding options under the 2016 Plan vest over four years at exercise prices ranging from $ 0.45 to $ 3.33 per share. Stock-Based Compensation Expense Total compensation cost related to stock options in both 2021 and 2020 was $ 0.4 million. These amounts were recorded in selling, general and administrative expense in both years. During 2021 and 2020, options to purchase 1,895,437 and 383,350 shares were exercised, respectively. The tax benefit recognized by the Company related to these option exercises was approximately $ 1.0 million in 2021, as compared to $ 0.2 million recognized in 2020. In connection with the stock option grants during 2021 and 2020, the fair value of each option grant was estimated on the date of the grant using the Black-Scholes option pricing model with the following assumptions: 2021 2020 Risk-free interest rate 0 % - 1 % 0 % - 2 % Expected life (years) 6.6 6.8 Expected volatility 80 % 74 % Expected dividend yield Zero Zero The risk-free interest rates are those for U.S. Treasury constant maturities for terms matching the expected term of the option. The expected life of the options is calculated according to the simplified method for estimating the expected term of the options, based on the vesting period and contractual term of each option grant. Expected volatility is based on the Company’s historical volatility. The Company has never paid a dividend on its common stock and therefore the expected dividend yield is zero. The following summarizes the changes in common stock options for 2021 and 2020: 2021 2020 Options Weighted Options Weighted Outstanding at beginning of year 3,516,225 $ 0.63 3,611,850 $ 0.51 Granted 722,500 $ 2.28 474,750 $ 1.62 Exercised ( 1,895,437 ) $ 0.48 ( 383,350 ) $ 0.46 Expired — $ — ( 20,000 ) $ 0.83 Forfeited ( 150,000 ) $ 1.61 ( 167,025 ) $ 1.15 Outstanding at end of year 2,193,288 $ 1.23 3,516,225 $ 0.63 Options exercisable at year end 978,350 $ 0.60 2,566,100 $ 0.47 Weighted-average fair value of options granted $ 1.59 $ 1.64 As of December 31, 2021, the Company had unvested options for the purchase of 1,214,938 shares with a weighted average grant date fair value of $ 0.96 per share. As of December 31, 2020, the Company had unvested options for the purchase of 950,125 shares with a weighted average grant date fair value of $ 0.71 per share. As of December 31, 2021, the total unrecognized stock-based compensation expense related to unvested stock options was $ 1.2 million, which is expected to be recognized over a weighted-average period of 3.1 years. The total fair value of options vesting during both 2021 and 2020 was $ 0.2 million and $ 0.3 million, respectively. The unvested options have no associated performance conditions. In general, the Company’s employee turnover is low, and the Company expects that the majority of the unvested options will vest according to the standard four-year timetable. The following table summarizes information about all stock options outstanding at December 31, 2021: Exercise price Options Weighted (years) Weighted Number Weighted Weighted $ 0.24 to $ 0.48 742,225 5.0 $ 0.44 700,600 4.9 $ 0.44 $ 0.53 to $ 0.95 501,063 7.7 $ 0.76 212,750 7.6 $ 0.76 $ 1.41 to $ 1.90 612,500 9.3 $ 1.47 47,500 8.5 $ 1.47 $ 2.77 to $ 3.33 337,500 9.2 $ 2.77 17,500 8.6 $ 2.77 2,193,288 978,350 At December 31, 2021 and 2020, the aggregate intrinsic value of exercisable options was $ 1.3 million and $ 6.3 million, respectively. Restricted Stock Restricted stock awards represent a right to receive shares of common stock at a future date determined in accordance with the participant’s award agreement. There is no exercise price and no monetary payment required for receipt of restricted stock awards or the shares issued in settlement of the award. Instead, consideration is furnished in the form of the participant’s services to the Company. Compensation cost for these awards is based on the fair value on the date of grant and recognized as compensation expense on a straight-line basis over the requisite service period. In June 2018, the Company granted 600,000 shares of Company restricted common stock in connection with the Addendum to the Employment Agreements of David Ludwig and Tom Ludwig. The shares are subject to certain restrictions on transfer and a right of repurchase over five years , ending May 31, 2023, and require a continued term of service to the Company. Stock-based compensation expense related to the restricted stock awards, calculated by using the grant date fair value of $ 0.43 per share, was $ 52,000 for both 2020 and 2021. The unrecognized stock-based compensation expense as of December 31, 2021 and 2020 was approximately $ 73,000 and $ 125,000 , respectively. Under the terms of the Separation Agreement, the Company granted 25,000 shares of the Company’s restricted common stock on April 8, 2021. The shares of restricted common stock will be forfeited to the Company during the two years following the effective date of the Separation Agreement in the event Mr. West breaches the terms of the Separation Agreement. The full amount of the restricted common stock was expensed in the first quarter of 2021 and there was no remaining unrecognized stock-based compensation expense as of December 31, 2021. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting Information Additional Information [Abstract] | |
Segment Information | Note 18 – Segment Information The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company’s reportable segments. The Company manages its business primarily on differentiated revenue streams for services offered. The Company’s reportable segments consist of the Industrial Asset Division and Financial Assets Division. Our Industrial Assets division advises enterprise and financial customers on the sale of industrial assets mostly from surplus and sometimes distressed circumstances while acting as an agent, guarantor or principal in the sale. Our Financial Assets division provides liquidity to issuers of consumer credit that are looking to monetize nonperforming and charged-off loans — loans that creditors have written off as uncollectable. Nonperforming and charged-off loans typically originate from banks that issue unsecured consumer credit. The Company evaluates the performance of its reportable segments based primarily on net operating income. Further, the Company does not utilize segmented asset information to evaluate the performance of its reportable segments and does not include intercompany transfers between segments for management reporting purposes. The following table sets forth certain financial information for the Company's reportable segments (in thousands): For the Year Ended December 31, 2021 2020 Industrial Assets Division: Net operating income $ 3,393 $ 5,764 Financial Assets Division: Net operating income $ 2,024 $ 2,637 Corporate and Other: Net operating loss $ ( 2,403 ) $ ( 2,342 ) Consolidated: Net operating income $ 3,014 $ 6,059 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 19 – Subsequent Events The Company has evaluated events subsequent to December 31, 2021 for potential recognition or disclosure in its consolidated financial statements. There have been no material subsequent events requiring disclosure in these financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of estimates The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant estimates include the assessment of collectability of revenue recognized and the valuation of accounts receivable and notes receivable, inventory, investments, goodwill and intangible assets, liabilities, deferred income tax assets and liabilities including projecting future years’ taxable income, and stock-based compensation. These estimates have the potential to significantly impact our consolidated financial statements, either because of the significance of the financial statement item to which they relate, or because they require judgment and estimation due to the uncertainty involved in measuring, at a specific point in time, events that are continuous in nature. |
Foreign Currency | Foreign Currency The functional currency of foreign operations is deemed to be the local country’s currency. Assets and liabilities of operations outside of the United States are generally translated into U.S. dollars, and the effects of foreign currency translation adjustments are included as a component of accumulated other comprehensive income. |
Reclassifications | Reclassifications Certain prior year balances within the consolidated financial statements have been reclassified to conform to current year presentation. |
Nature of Business | Nature of Business The Company earns revenue both from commission or fee-based services, and from the sale of distressed or surplus assets. With respect to the former, revenue is recognized as the services are provided. With respect to the latter, the majority of the asset sale transactions are conducted directly by the Company and the revenue is recognized in the period in which the asset is sold. Fee based revenue is reported as services revenue, and the associated direct costs are reported as cost of services revenue. At the balance sheet date, any unsold assets which the Company owns are reported as inventory, any outstanding accounts receivable are included in the Company’s accounts receivable, and any associated liabilities are included in the Company’s accrued liabilities. Equipment inventory is expected to be sold within a year and is therefore classified as a current asset. The remaining asset sale transactions involve the Company acting jointly with one or more additional purchasers, pursuant to a partnership, joint venture or limited liability company agreement (collectively, “Joint Ventures”). Transactions in which the Company’s ownership share meets the criteria for the equity method investments under ASC Topic 323 – Equity Method and Joint Ventures (“ASC 323”), are accounted for as equity method investments, and, accordingly, the Company’s proportionate share of the net income (loss) is reported as earnings of equity method investments. At each balance sheet date, the Company’s investments in these Joint Ventures are reported in the consolidated balance sheet as equity method investments. Although the Company generally expects to exit each of its investments in Joint Ventures in less than one year, they are classified on the balance sheet as non-current assets due to the uncertainties relating to the timing of resale of the underlying assets as a result of the Joint Venture relationship. The Company monitors the value of the Joint Ventures’ underlying assets and liabilities and records a write down of its investments if the Company concludes that there has been a decline in the value of the net assets. As the activity of the Joint Ventures involves asset purchase/resale transactions, which is similar in nature to the Company’s other asset liquidation activities, the earnings (losses) of the Joint Ventures are included in the operating income in the accompanying consolidated income statements. In 2019, the Company formed Heritage Global Capital LLC (“HGC”), a wholly owned subsidiary of HGI, in order to provide specialty financing solutions to investors in charged-off and nonperforming asset portfolios. |
Cash and cash equivalents | Cash and cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains its cash and cash equivalents with financial institutions in the United States. These accounts may from time to time exceed federally insured limits. The Company has not experienced any losses on such accounts. |
Accounts receivable, net | Accounts receivable, net The Company’s accounts receivable primarily relate to the operations of its asset liquidation business. They generally consist of three major categories: (1) fees, commissions and retainers relating to appraisals and auctions, (2) receivables from asset sales, and (3) receivables from Joint Venture partners. The initial value of an account receivable corresponds to the fair value of the underlying goods or services. To date, a majority of the receivables have been classified as current and, due to their short-term nature, any decline in fair value would be due to issues involving collectability. At each financial statement date the collectability of each outstanding account receivable is evaluated, and an allowance is recorded if the book value exceeds the amount that is deemed collectable. See Note 11 for more detail regarding the Company’s accounts receivable. |
Notes receivable, net | Notes receivable, net The Company’s notes receivable balance consists of loans to buyers of charged-off and nonperforming receivable portfolios, which is considered the only loan category or segment to be reported under the applicable accounting guidance. These loans are measured at historical costs and reported at their outstanding principal balances net of any unamortized deferred fees and costs on originated loans. Loan origination fees and certain direct origination costs are deferred and recognized as adjustments to interest income over the lives of the related loans. As of December 31, 2021, the Company has no t recorded an allowance for credit losses related to notes receivable outstanding. In order to evaluate the need for an adjustment to the receivable balance related to credit losses, or impairment, the Company performs a review of all outstanding loan receivables on a quarterly basis to determine if any indicators exist that suggest the loan will not be fully recoverable. |
Inventory | Inventory The Company’s inventory consists of assets acquired for resale, which are normally expected to be sold within a one-year operating cycle. All inventory is recorded at the lower of cost or net realizable value. |
Equity Method Investments | Equity Method Investments As noted above, we conduct a portion of our asset liquidation business through Joint Ventures. Transactions in which the Company’s ownership share meets the criteria for the equity method investments under ASC Topic 323 are accounted for using the equity method of accounting whereby our proportionate share of the Joint Venture’s net income (loss) is reported in the consolidated income statement as earnings of equity method investments. At the balance sheet date, our investments in these Joint Ventures are reported in the consolidated balance sheet as equity method investments. We monitor the value of each Joint Ventures’ underlying assets and liabilities and record a write down of our investments should we conclude that there has been a decline in the value of the net assets. Given that the underlying transactions are identical, in all material aspects, to asset liquidation transactions that we undertake independently, the net assets are similarly expected to be sold within a one-year operating cycle. However, these investments have historically been classified as non-current in our consolidated financial statements due to the uncertainties relating to the timing of resale of the underlying assets as a result of the Joint Venture relationship. See Note 6 for further detail. |
Fair value of financial instruments | Fair value of financial instruments The fair value of financial instruments is the amount at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. At December 31, 2021 and 2020, the carrying values of the Company’s cash, accounts receivable, other assets, accounts payable and accrued liabilities approximate fair value given the short term nature of these instruments. The Company’s notes receivable and debt obligations approximate fair value as a result of the interest rate on the receivable or debt obligation approximating prevailing market rates. There are three levels within the fair value hierarchy: Level 1 – quoted prices in active markets for identical assets or liabilities; Level 2 – significant other observable inputs; and Level 3 – significant unobservable inputs. At December 31, 2021 and 2020, the Company had no material financial instruments requiring fair value measurement. |
Business combinations | Business combinations Acquisitions are accounted for under ASC Topic 805, Business Combinations (“ASC 805”), which requires that assets acquired and liabilities assumed that are deemed to be a business are recorded based on their respective acquisition date fair values. ASC 805 further requires that separately identifiable intangible assets be recorded at their acquisition date fair values and that the excess of consideration paid over the fair value of assets acquired and liabilities assumed (including identifiable intangible assets) should be recorded as goodwill. In August 2021 the Company acquired American Laboratory Trading ("ALT") for approximately $ 5.6 million. The Company's purchase price allocation was based on an evaluation of the appropriate fair values and represents management's best estimate. See Note 3 for further detail. |
Intangible assets | Intangible assets Intangible assets are recorded at fair value upon acquisition. Those with an estimated useful life are amortized, and those with an indefinite useful life are unamortized. Subsequent to acquisition, the Company monitors events and changes in circumstances that require an assessment of intangible asset recoverability. Indefinite-lived intangible assets are assessed at least annually to determine both if they remain indefinite-lived and if they are impaired. The Company assesses whether or not there have been any events or changes in circumstances that suggest the value of the asset may not be recoverable. Amortized intangible assets are not tested annually, but are assessed when events and changes in circumstances suggest the assets may be impaired. If an assessment determines that the carrying amount of any intangible asset is not recoverable, an impairment loss is recognized in the income statement, determined by comparing the carrying amount of the asset to its fair value. All of the Company’s identifiable intangible assets at December 31, 2021 have been acquired as part of the acquisitions of HGP in 2012, NLEX in 2014 and ALT in 2021, and are discussed in more detail in Note 10. No impairment charges were necessary during 2021. |
Goodwill | Goodwill Goodwill, which results from the difference between the purchase price and the fair value of net identifiable tangible and intangible assets acquired in a business combination, is not amortized but, in accordance with GAAP, is tested at least annually for impairment. The Company performs its annual impairment test as of October 1. In testing goodwill, the Company initially uses a qualitative approach and analyzes relevant factors to determine if events and circumstances have affected the value of the goodwill. If the result of this qualitative analysis indicates that the value has been impaired, the Company then applies a quantitative approach to calculate the difference between the goodwill’s recorded value and its fair value. An impairment loss is recognized to the extent that the recorded value exceeds its fair value. Goodwill, in addition to being tested for impairment annually, is tested for impairment at interim periods if an event occurs or circumstances change such that it is more likely than not that the carrying amount of goodwill may be impaired. All of the Company’s goodwill relates to its acquisitions of HGP in 2012, NLEX in 2014 and ALT in 2021, and is discussed in more detail in Note 10. |
Deferred income taxes | Deferred income taxes The Company recognizes deferred tax assets and liabilities for temporary differences between the tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted tax rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance when necessary to reduce deferred tax assets to the amount expected to be realized. In 2014, as a result of incurring losses in previous years, the Company recorded a valuation allowance against all of its net deferred tax assets. In 2020 the Company recorded a reduction to the valuation allowance resulting in a net deferred tax asset balance of approximately $ 4.4 million as it is more likely than not that some of our net operating loss carryforwards will be utilized. For further discussion of our income taxes, see Note 14. |
Liabilities and contingencies | Liabilities and contingencies The Company is involved from time to time in various legal matters arising out of its operations in the normal course of business. On a case by case basis, the Company evaluates the likelihood of possible outcomes for this litigation. Based on this evaluation, the Company determines whether a loss accrual is appropriate. If the likelihood of a negative outcome is probable, and the amount can be reasonably estimated, the Company accounts for the estimated loss in the current period. See Note 16 for further discussion. |
Revenue Recognition | Revenue recognition In 2018, the Company adopted the accounting standard ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) to all contracts using the modified retrospective method. Services revenue generally consists of commissions and fees from providing auction services, appraisals, brokering of sales transactions, secured lending and providing merger and acquisition advisory services. Asset sales revenue generally consists of proceeds obtained through sales of purchased assets. Revenue is recognized for both services revenue and asset sales revenue based on the ASC 606 standard recognition model, which consists of the following: (1) an agreement exists between two or more parties that creates enforceable rights and obligations, (2) the performance obligations are clearly identified, (3) the transaction price has been determined, (4) the transaction price has been properly allocated to each performance obligation, and (5) the entity satisfies a performance obligation by transferring a promised good or service to a customer for each of the entities. All services and asset sales revenue from contracts with customers is considered to be within the asset liquidation business, which consists of two reportable segments, the Industrial Assets Division and the Financial Assets Division. Generally, revenue is recognized in the asset liquidation business at the point in time in which the performance obligation has been satisfied and full consideration is received. The exception to recognition at a point in time occurs when certain contracts provide for advance payments recognized over a period of time. Services revenue recognized over a period of time is not material in comparison to total revenues ( less than 1 % of total revenues for the year ended December 31, 2021), and therefore not reported on a disaggregated basis. Further, as certain contracts stipulate that the customer make advance payments, amounts not recognized within the reporting period are considered deferred revenue and the Company’s “contract liability”. As of December 31, 2021, the deferred revenue balance was approximately $ 0.5 million. The deferred revenue balance is primarily related to customer deposits on ALT asset sales. The Company records receivables related to asset liquidation in certain situations based on timing of payments for asset liquidation transactions held at the end of the reporting period; however, revenue is generally recognized in the period that the Company satisfies the performance obligation and cash is collected. The Company does not record a “contract asset” for partially satisfied performance obligations. The Company evaluates revenue from asset liquidation transactions in accordance with the accounting guidance to determine whether to report such revenue on a gross or net basis. The Company has determined that it acts as an agent for its fee based asset liquidation transactions and therefore reports the revenue from transactions in which the Company acts as an agent on a net basis. The Company also earns asset liquidation income through asset liquidation transactions that involve the Company acting jointly with one or more additional purchasers, pursuant to a partnership, joint venture or limited liability company (“LLC”) agreement (collectively, “Joint Ventures”). For these transactions, in which the Company’s ownership share meets the criteria for the equity method investments under ASC 323, the Company does not record asset liquidation revenue or expense. Instead, the Company’s proportionate share of the net income (loss) is reported as earnings of equity method investments. In general, the Joint Ventures apply the same revenue recognition and other accounting policies as the Company. In 2019, the Company began providing specialty financing solutions to investors in charged-off and nonperforming asset portfolios. Fees collected in relation to the issuance of loans includes loan origination fees, interest income, portfolio monitoring fees, and a backend profit share percentage related to the underlying asset portfolio. The loan origination fees are offset with any direct origination costs and are deferred upon issuance of the loan and amortized over the lives of the related loans, as an adjustment to interest income. The interest method is used to arrive at a periodic interest cost (including amortization) that will represent a level effective rate on the sum of the face amount of the debt and (plus or minus) the unamortized premium or discount and expense at the beginning of each period. The monitoring fees and the backend profit share are considered a separate earnings process as compared to the origination fees and interest income. Monitoring fees are recorded at the agreed upon rate, and at the moment in which payments are made by the borrower. The backend profit share is recognized in accordance with the agreed upon rate at the time in which the amount is realizable and earned. The recognition policy was established due to the uncertainty of timing of the amount of backend profit share which will be realized, and the lack of historical precedence as this is a new business for the Company. During 2021 and 2020 the Company generated revenues specific to one customer representing 8 % and 10 % of total revenues respectively. |
Cost of services revenue and asset sales | Cost of services revenue and asset sales Cost of services revenue generally includes the direct costs associated with generating commissions and fees from the Company’s auction and appraisal services, merger and acquisition advisory services, and brokering of charged-off receivable portfolios. The Company recognizes these expenses in the period in which the revenue they relate to is recorded. Cost of asset sales generally includes the cost of purchased inventory and the related direct costs of selling inventory. The Company recognizes these expenses in the period in which title to the inventory passes to the buyer, and the buyer assumes the risk and reward of the inventory. |
Stock-based compensation | Stock-based compensation The Company’s stock-based compensation is primarily in the form of options to purchase common shares. The grant date fair value of stock options is calculated using the Black-Scholes option pricing model. The determination of the fair value of the Company’s stock options is based on a variety of factors including, but not limited to, the price of the Company’s common stock, the expected volatility of the stock price over the expected life of the award, and expected exercise behavior. The grant date fair value of the awards is subsequently expensed over the vesting period, net of estimated forfeitures. The provisions of the Company’s stock-based compensation plans do not require the Company to settle any options by transferring cash or other assets, and therefore the Company classifies the option awards as equity. See Note 17 for further discussion of the Company’s stock-based compensation. |
Advertising | Advertising The Company expenses advertising costs in the period in which they are incurred. Advertising and promotion expense included in selling, general and administrative expense for the years ended December 31, 2021 and 2020, was $ 0.4 million and $ 0.4 million, respectively. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes. The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. ASU 2019-12 became effective January 1, 2021 and did not have a material impact on the Company's consolidated financial statements. |
Future accounting pronouncements | Future accounting pronouncements In 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (“ASU 2016-13”), which applies a current expected credit loss model which is a new impairment model based on expected losses rather than incurred losses. The expected credit losses, and subsequent adjustments to such losses, will be recorded through an allowance account that is deducted from, or added to, the amortized cost basis of the financial asset, with the net carrying value of the financial asset presented on the consolidated balance sheet at the amount expected to be collected. ASU 2016-13 eliminates the current accounting model for loans and debt securities acquired with deteriorated credit quality under ASC Topic 310-30, Receivables – Loans and Debt Securities Acquired with Deteriorated Credit Quality, which provides authoritative guidance for the accounting of the Company’s notes receivable. With respect to smaller reporting companies, the amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Schedule of Major Classes of Assets and Liabilities Preliminarily Allocated to Purchase Price | The major classes of assets and liabilities to which the Company has allocated the purchase price were as follows (in thousands): Accounts receivable $ 410 Inventory - equipment 498 Property, plant and equipment 1,315 Intangible assets 1,800 Goodwill 1,861 Other assets 8 Accounts payable and accrued liabilities ( 274 ) Purchase price $ 5,618 |
Unaudited Pro Forma Information | For the Year Ended December 31, 2021 2020 Pro forma revenues $ 29,788 $ 32,082 Pro forma net income $ 3,285 $ 10,296 Pro forma net income per share - basic $ 0.09 $ 0.34 Pro forma net income per share - diluted $ 0.09 $ 0.31 |
Notes Receivable, Net (Tables)
Notes Receivable, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Receivables [Abstract] | |
Schedule of Company's Lending Activity | The table below shows the Company’s lending activity during 2021 and 2020: 2021 2020 Notes receivable, beginning of year $ 2,079 $ 2,685 Loan originations 8,039 6,081 Transfer of notes ( 1,961 ) ( 4,951 ) Principal repayments ( 3,985 ) ( 1,736 ) Notes receivable, end of year 4,172 2,079 Deferred financing fees and costs, net ( 134 ) 7 Notes receivable, net, end of year $ 4,038 $ 2,086 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity Method Investments And Joint Ventures [Abstract] | |
Schedule of Joint Venture Revenues and Net Income (Loss) | The table below details the Company’s Joint Venture revenues and earnings during 2021 and 2020 (in thousands): 2021 2020 Revenues: Oak Grove Asset Acquisitions LP $ 5 $ 1,129 CPFH LLC 473 15,538 HGC Funding I LLC and Origination I LLC 238 761 Total Revenues $ 716 $ 17,428 Operating income: Oak Grove Asset Acquisitions LP $ 4 $ 237 CPFH LLC ( 548 ) 13,930 HGC Funding I LLC and Origination I LLC 212 689 Total operating (loss) income $ ( 332 ) $ 14,856 |
Schedule of the Components of Assets and Liabilities | The table below details the summarized components of assets and liabilities, as at December 31, 2021 and 2020, of the Company’s Joint Ventures at those dates (in thousands): 2021 2020 Assets: Oak Grove Asset Acquisitions LP $ — $ — CPFH LLC 11,789 10,791 HGC Funding I LLC and Origination I LLC 10,476 — Total assets $ 22,265 $ 10,791 Liabilities: Oak Grove Asset Acquisitions LP $ — $ 1 CPFH LLC 6,099 5,374 HGC Funding I LLC and Origination I LLC — — Total liabilities $ 6,099 $ 5,375 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of the Shares Used in Computing Diluted EPS | The table below shows the calculation of the shares used in computing diluted EPS: December 31, December 31, Weighted Average Shares Calculation: 2021 2020 Basic weighted average shares outstanding 35,458,938 30,200,053 Treasury stock effect of common stock options and restricted stock awards 1,442,452 2,508,182 Diluted weighted average common shares outstanding 36,901,390 32,708,235 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Schedule of Right-of-Use Assets and Lease Liabilities | The right-of-use assets and lease liabilities for each location are as follows (in thousands): Right-of-use assets: December 31, December 31, Del Mar, CA $ 477 $ 613 Hayward, CA 2,064 — Burlingame, CA — 99 Edwardsville, IL 153 251 $ 2,694 $ 963 Lease liabilities: December 31, December 31, Del Mar, CA $ 506 $ 641 Hayward, CA 2,089 — Burlingame, CA — 109 Edwardsville, IL 155 253 $ 2,750 $ 1,003 |
Schedule of Undiscounted Future Minimum Lease Commitments | Undiscounted future minimum lease commitments as of December 31, 2021 that have initial or remaining lease terms in excess of one year are as follows (in thousands): 2022 $ 612 2023 563 2024 532 2025 396 2026 377 Thereafter 687 Total undiscounted future minimum lease payments 3,167 Less: imputed interest ( 417 ) Present value of lease liabilities $ 2,750 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | The following summarizes the components of the Company’s property, plant and equipment (in thousands): December 31, December 31, Building $ 985 $ — Land 397 — Furniture, fixtures and office equipment 97 203 Software and technology assets 84 340 Vehicles 11 — 1,574 543 Accumulated depreciation ( 103 ) ( 413 ) Property, plant and equipment, net $ 1,471 $ 130 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The details of identifiable intangible assets as of December 31, 2021 and 2020 are shown below (in thousands except for lives): Amortized Intangible Assets Original Remaining Carrying Intangible Amortization Carrying 31, Customer Relationships (HGP) 12 1.0 $ 62 $ — $ ( 32 ) $ 30 Trade Name (HGP) 14 3.0 513 — ( 128 ) 386 Customer Relationships (NLEX) 7.6 — 111 — ( 110 ) — Vendor Relationships (ALT) 5 4.7 — 1,150 ( 77 ) 1,073 Trade Name (ALT) 20 19.7 — 650 ( 11 ) 639 Total 686 1,800 ( 358 ) 2,128 Unamortized Intangible Assets Trade Name (NLEX) N/A N/A 2,437 — — 2,437 Total $ 3,123 $ 1,800 $ ( 358 ) $ 4,565 Amortized Intangible Assets Original Remaining Carrying Intangible Amortization Carrying Customer Relationships (HGP) 12 2.0 $ 92 $ — $ ( 30 ) $ 62 Trade Name (HGP) 14 4.0 642 — ( 129 ) 513 Customer Relationships (NLEX) 7.6 1 221 — ( 110 ) 111 Total 955 — ( 269 ) 686 Unamortized Intangible Assets Trade Name (NLEX) N/A N/A 2,437 — — 2,437 Total $ 3,392 $ — $ ( 269 ) $ 3,123 |
Schedule of Estimated Amortization Expense, Intangible Assets | The estimated amortization expense during future years is shown below (in thousands): Year Amount 2022 $ 421 2023 391 2024 391 2025 262 2026 186 Thereafter 477 Total $ 2,128 |
Schedule of Goodwill | Goodwill consisted of the following at December 31, 2021 and 2020 (in thousands): Acquisition December 31, December 31, HGP 2,040 2,040 NLEX 3,545 3,545 ALT 1,861 — Total goodwill $ 7,446 $ 5,585 |
Accounts Receivable and Accou_2
Accounts Receivable and Accounts Payable (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables And Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable and accrued liabilities consisted of the following at December 31, 2021 and 2020 (in thousands): 2021 2020 Due to auction clients $ 6,433 $ 8,026 Remuneration and benefits 1,909 2,498 Due to Joint Venture partners 402 1,349 Sales and other taxes 226 831 Accrued asset liquidation expenses 1,340 346 Accounting, auditing and tax consulting 184 166 Customer deposits 407 — Other 343 393 Total accounts payable and accrued liabilities $ 11,244 $ 13,609 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Outstanding debt is summarized as follows (in thousands): December 31, December 31, Current Third party debt $ 2,479 $ — Non-current: Third party debt 1,352 — Total debt $ 3,831 $ — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Summary of Change in Valuation Allowance | The following table summarizes the change in the valuation allowance during 2020 and 2021 (in thousands): Balance at December 31, 2019 $ 17,639 Change during 2020 ( 4,542 ) Balance at December 31, 2020 13,097 Change during 2021 ( 855 ) Balance at December 31, 2021 $ 12,242 |
Schedule of Components of Income Tax Expense (Benefit) | The reported tax expense varies from the amount that would be provided by applying the statutory U.S. Federal income tax rate to the income before income tax expense for the following reasons in each of the years ended December 31 (in thousands): 2021 2020 Expected federal statutory tax expense $ 628 $ 1,263 Increase (reduction) in taxes resulting from: State income taxes recoverable 43 388 Non-deductible expenses (permanent differences) ( 707 ) ( 193 ) Change in valuation allowance ( 855 ) ( 4,542 ) Tax rate changes 876 ( 599 ) Other ( 46 ) 39 Income tax benefit $ ( 61 ) $ ( 3,644 ) |
Schedule of Deferred Tax Assets and Liabilities | The components of the net deferred tax assets as of December 31, 2021 and 2020 are as follows in (thousands): 2021 2020 Net operating loss carry forwards $ 16,824 $ 17,623 Stock based compensation 1,095 1,007 Trade names and customer relationships ( 741 ) ( 805 ) Equity method investments ( 477 ) ( 478 ) Other 29 152 Gross deferred tax assets 16,730 17,499 Less: valuation allowance ( 12,242 ) ( 13,097 ) Deferred tax assets, net of valuation allowance $ 4,488 $ 4,402 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Class Of Stock [Line Items] | |
Schedule of Assumptions for Fair Value of Option Grant | In connection with the stock option grants during 2021 and 2020, the fair value of each option grant was estimated on the date of the grant using the Black-Scholes option pricing model with the following assumptions: 2021 2020 Risk-free interest rate 0 % - 1 % 0 % - 2 % Expected life (years) 6.6 6.8 Expected volatility 80 % 74 % Expected dividend yield Zero Zero |
Schedule of Changes in Common Stock Options | The following summarizes the changes in common stock options for 2021 and 2020: 2021 2020 Options Weighted Options Weighted Outstanding at beginning of year 3,516,225 $ 0.63 3,611,850 $ 0.51 Granted 722,500 $ 2.28 474,750 $ 1.62 Exercised ( 1,895,437 ) $ 0.48 ( 383,350 ) $ 0.46 Expired — $ — ( 20,000 ) $ 0.83 Forfeited ( 150,000 ) $ 1.61 ( 167,025 ) $ 1.15 Outstanding at end of year 2,193,288 $ 1.23 3,516,225 $ 0.63 Options exercisable at year end 978,350 $ 0.60 2,566,100 $ 0.47 Weighted-average fair value of options granted $ 1.59 $ 1.64 |
Schedule of Information about All Stock Options Outstanding | The following table summarizes information about all stock options outstanding at December 31, 2021: Exercise price Options Weighted (years) Weighted Number Weighted Weighted $ 0.24 to $ 0.48 742,225 5.0 $ 0.44 700,600 4.9 $ 0.44 $ 0.53 to $ 0.95 501,063 7.7 $ 0.76 212,750 7.6 $ 0.76 $ 1.41 to $ 1.90 612,500 9.3 $ 1.47 47,500 8.5 $ 1.47 $ 2.77 to $ 3.33 337,500 9.2 $ 2.77 17,500 8.6 $ 2.77 2,193,288 978,350 |
Other Options Issued [Member] | |
Class Of Stock [Line Items] | |
Schedule of Stock Options and Other Stock Options Issued | Other Options 2021 2020 Options outstanding, beginning of year 344,375 265,000 Options issued 150,000 90,000 Options exercised ( 22,500 ) ( 10,625 ) Options forfeited ( 67,500 ) — Options outstanding, end of year 404,375 344,375 |
2003 Stock Option and Appreciation Rights Plan [Member] | |
Class Of Stock [Line Items] | |
Schedule of Stock Options and Other Stock Options Issued | 2003 Plan 2021 2020 Options outstanding, beginning of year — 20,000 Options expired — ( 20,000 ) Options outstanding, end of year — — |
2010 Non-Qualified Stock Option Plan [Member] | |
Class Of Stock [Line Items] | |
Schedule of Stock Options and Other Stock Options Issued | 2010 Plan 2021 2020 Options outstanding, beginning of year 1,100,000 975,000 Options granted 50,000 125,000 Options exercised ( 793,750 ) — Options forfeited ( 25,000 ) — Options outstanding, end of year 331,250 1,100,000 |
2016 Stock Option Plan [Member] | |
Class Of Stock [Line Items] | |
Schedule of Stock Options and Other Stock Options Issued | 2016 Plan 2021 2020 Options outstanding, beginning of year 2,071,850 2,351,850 Options granted 522,500 259,750 Options exercised ( 1,079,187 ) ( 372,725 ) Options forfeited ( 57,500 ) ( 167,025 ) Options outstanding, end of year 1,457,663 2,071,850 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting Information Additional Information [Abstract] | |
Schedule of Financial Information for the Company's Reportable Segments | The following table sets forth certain financial information for the Company's reportable segments (in thousands): For the Year Ended December 31, 2021 2020 Industrial Assets Division: Net operating income $ 3,393 $ 5,764 Financial Assets Division: Net operating income $ 2,024 $ 2,637 Corporate and Other: Net operating loss $ ( 2,403 ) $ ( 2,342 ) Consolidated: Net operating income $ 3,014 $ 6,059 |
Description of Business and P_2
Description of Business and Principles of Consolidation - Public offering (Details) - Common Stock [Member] $ / shares in Units, $ in Millions | Oct. 06, 2020USD ($)$ / sharesshares |
Number shares issuance public offering | 5,462,500 |
Public offering price per share | $ / shares | $ 1.75 |
Number of shares exercise of the underwriters option to purchase | 712,500 |
Proceeds from issuance public offering | $ | $ 8.7 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Aug. 31, 2021USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2021USD ($)Segment | Dec. 31, 2020USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||||
Allowance for credit losses related to notes receivable outstanding | $ 0 | $ 0 | ||
Intangible assets impairment charges | 0 | |||
Goodwill impairment charges | 0 | |||
Deferred tax assets | 4,488 | $ 4,488 | $ 4,402 | |
Percentage of revenue specific to customer from net revenue | 8.00% | 10.00% | ||
Accounts receivable | 600 | $ 600 | ||
Selling, General and Administrative Expenses [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Advertising and promotion expense | $ 400 | $ 400 | ||
Maximum [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of service revenue that is recognized over a period of time against total revenue | 80.00% | |||
American Laboratory Trading [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Stock Issued During Period, Value, Acquisitions | $ 5,600 | |||
ASC 606 [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Number of reporting segment | Segment | 2 | |||
Deferred revenue | $ 500 | $ 500 | ||
ASC 606 [Member] | Maximum [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of service revenue that is recognized over a period of time against total revenue | 1.00% |
Business Combinations (Narrativ
Business Combinations (Narrative) (Details) - USD ($) $ in Thousands | Aug. 23, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Intangible Assets | $ 4,565 | $ 3,123 | |
Intangible Assets, Increase | 400 | ||
Fair value of acquired inventory | 600 | ||
Real Estate Purchase Agreement [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price of the Property | $ 1,300 | ||
ALT [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price paid | 5,600 | ||
Businesses acquisition, payment by cash | 2,300 | ||
Business acquisition, as ALT note | 2,000 | ||
Purchase price of the Property | $ 1,300 | ||
Acquisition related costs | 200 | ||
Intangible Assets | 1,800 | ||
ALT [Member] | Vendor Relationships [Member] | |||
Business Acquisition [Line Items] | |||
Intangible Assets | $ 1,200 | ||
Intangible Assets, Amortization Period | 5 years | 4 years 8 months 12 days | |
ALT [Member] | Trade Name [Member] | |||
Business Acquisition [Line Items] | |||
Intangible Assets | $ 700 | ||
Intangible Assets, Amortization Period | 20 years |
Business Combinations - Schedul
Business Combinations - Schedule of Major Classes of Assets and Liabilities Preliminarily Allocated to Purchase Price (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||
Accounts receivable | $ 600 | |
Goodwill | 7,446 | $ 5,585 |
ALT [Member] | ||
Business Acquisition [Line Items] | ||
Accounts receivable | 410 | |
Inventory - equipment | 498 | |
Property, plant and equipment | 1,315 | |
Intangible assets | 1,800 | |
Goodwill | 1,861 | $ 0 |
Other assets | 8 | |
Accounts payable and accrued liabilities | (274) | |
Purchase price | $ 5,618 |
Business Combinations - Unaudit
Business Combinations - Unaudited Pro Forma Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Business Combinations [Abstract] | ||
Pro forma revenues | $ 29,788 | $ 32,082 |
Pro forma net income | $ 3,285 | $ 10,296 |
Pro forma net income per share - basic | $ 0.09 | $ 0.34 |
Pro forma net income per share - diluted | $ 0.09 | $ 0.31 |
Notes Receivable, Net - Narrati
Notes Receivable, Net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Receivables [Abstract] | |||
Outstanding principal balance | $ 4,172 | $ 2,079 | $ 2,685 |
Outstanding principal balance | 4,000 | ||
Additional notes issued | 8,000 | ||
Principal payments received | 4,000 | ||
Deferred fees and costs | 100 | ||
Notes receivable balance of certain loans transferred to joint venture | 2,000 | ||
Allowance for credit losses | $ 0 |
Notes Receivable, Net - Schedul
Notes Receivable, Net - Schedule of Company's Lending Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts Notes And Loans Receivable [Line Items] | ||
Notes receivable , beginning of year | $ 2,079 | $ 2,685 |
Loan originations | 8,039 | 6,081 |
Transfer of notes | (1,961) | (4,951) |
Principal repayments | (3,985) | (1,736) |
Notes receivable, end of year | 4,172 | 2,079 |
Deferred financing fees and costs, net | (134) | 7 |
Notes receivable, net, end of year | $ 4,038 | $ 2,086 |
Lessor Arrangement (Narrative)
Lessor Arrangement (Narrative) (Details) $ in Millions | 1 Months Ended |
Jun. 30, 2019USD ($) | |
Lessor Lease Description [Line Items] | |
Sale leaseback transaction, date | The purchase option for both the real estate and machinery and equipment was expected to be exercised at any time on or after December 1, 2019 and before May 31, 2021 |
Total purchase price | $ 20 |
Real Estate [Member] | |
Lessor Lease Description [Line Items] | |
Lease payments term | 10 years |
Total monthly lease payments | $ 13.2 |
Total purchase price | $ 12 |
Machinery and Equipment [Member] | |
Lessor Lease Description [Line Items] | |
Lease payments term | 6 years |
Total monthly lease payments | $ 9.7 |
Total purchase price | 8 |
Derecognized lease asset | 0.9 |
Revenue from derecognized lease asset | $ 1.2 |
Equity Method Investments (Narr
Equity Method Investments (Narrative) (Details) | Mar. 31, 2019 | Nov. 14, 2018 |
CPFH LLC [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Equity method investment, ownership percentage | 25.00% | |
Oak Grove Asset Acquisitions LP [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Equity method investment, ownership percentage | 50.00% |
Schedule of Joint Venture Reven
Schedule of Joint Venture Revenues and Net Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule Of Equity Method Investments [Line Items] | ||
Net income | $ 3,053 | $ 9,658 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Revenues | 716 | 17,428 |
Net income | (332) | 14,856 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Oak Grove Asset Acquisitions LP [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Revenues | 5 | 1,129 |
Net income | 4 | 237 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | CPFH LLC [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Revenues | 473 | 15,538 |
Net income | (548) | 13,930 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | HGC Funding I LLC and Origination I LLC [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Revenues | 238 | 761 |
Net income | $ 212 | $ 689 |
Schedule of the Components of A
Schedule of the Components of Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule Of Equity Method Investments [Line Items] | ||
Assets | $ 50,464 | $ 44,555 |
Liabilities | 17,825 | 14,612 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Assets | 22,265 | 10,791 |
Liabilities | 6,099 | 5,375 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Oak Grove Asset Acquisitions LP [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Liabilities | 1 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | CPFH LLC [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Assets | 11,789 | 10,791 |
Liabilities | 6,099 | $ 5,374 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | HGC Funding I LLC and Origination I LLC [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Assets | $ 10,476 |
Earnings per Share (Narrative)
Earnings per Share (Narrative) (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Convertible Preferred Stock, Shares Issuable upon Conversion | the Company’s shares of Series N preferred stock, each of which is convertible to 40 common shares, have the right to receive dividends or dividend equivalents should the Company declare dividends on its common stock. | |
Series N preferred stock, each convertible to common shares | 40 | |
Anti-dilutive common shares | 300,000 | 100,000 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Calculation of the Shares Used in Computing Diluted EPS (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Basic weighted average shares outstanding | 35,458,938 | 30,200,053 |
Treasury stock effect of common stock options and restricted stock awards | 1,442,452 | 2,508,182 |
Diluted weighted average common shares outstanding | 36,901,390 | 32,708,235 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021USD ($)Location | Dec. 31, 2020USD ($) | Apr. 01, 2021 | Jan. 01, 2019 | |
Lessee Lease Description [Line Items] | ||||
Number of locations | Location | 3 | |||
Lessee operating lease, incremental borrowing rate | 4.95% | 5.25% | ||
Lease expense | $ | $ 0.5 | $ 0.6 | ||
Burlingame, CA [Member] | ||||
Lessee Lease Description [Line Items] | ||||
Lease termination date | Apr. 30, 2021 | |||
Hayward, CA [Member] | ||||
Lessee Lease Description [Line Items] | ||||
Warehouse lease, effective date | Apr. 1, 2021 |
Leases - Schedule of Right-of-U
Leases - Schedule of Right-of-Use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Lessee Lease Description [Line Items] | ||
Right-of-use asset | $ 2,694 | $ 963 |
Lease liabilities | 2,750 | 1,003 |
Del Mar, CA [Member] | ||
Lessee Lease Description [Line Items] | ||
Right-of-use asset | 477 | 613 |
Lease liabilities | 506 | 641 |
Hayward F G H K Industrial L L C [Member] | ||
Lessee Lease Description [Line Items] | ||
Right-of-use asset | 2,064 | |
Lease liabilities | 2,089 | |
Burlingame, CA [Member] | ||
Lessee Lease Description [Line Items] | ||
Right-of-use asset | 99 | |
Lease liabilities | 109 | |
Edwardsville, IL [Member] | ||
Lessee Lease Description [Line Items] | ||
Right-of-use asset | 153 | 251 |
Lease liabilities | $ 155 | $ 253 |
Leases - Schedule of Undiscount
Leases - Schedule of Undiscounted Future Minimum Lease Commitments (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Operating Lease Liabilities Payments Due [Abstract] | ||
2022 | $ 612 | |
2023 | 563 | |
2024 | 532 | |
2025 | 396 | |
2026 | 377 | |
Thereafter | 687 | |
Total undiscounted future minimum lease payments | 3,167 | |
Less: imputed interest | (417) | |
Present value of lease liabilities | $ 2,750 | $ 1,003 |
Property, Plant and Equipment,
Property, Plant and Equipment, net (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property Plant And Equipment [Line Items] | ||
Depreciation expense | $ 102,000 | $ 94,000 |
Building | ||
Property Plant And Equipment [Line Items] | ||
Estimated service life | 25 years | |
Furniture, fixtures and office equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Estimated service life | 5 years | |
Software and technology assets [Member] | ||
Property Plant And Equipment [Line Items] | ||
Estimated service life | 3 years |
Schedule of Property, Plant and
Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 1,574 | $ 543 |
Accumulated depreciation | (103) | (413) |
Property, plant and equipment, net | 1,471 | 130 |
Building | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 985 | |
Land | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 397 | |
Furniture, fixtures and office equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 97 | 203 |
Software and technology assets [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 84 | $ 340 |
Vehicle | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 11 |
Schedule of Intangible Assets (
Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Total net amortized intangible assets | $ 686 | $ 955 | |
Intangible assets acquired | 1,800 | 0 | |
Total net amortized intangible assets | 2,128 | 686 | $ 955 |
Amortization | (358) | (269) | |
Intangible assets acquired | 1,800 | 0 | |
Total net intangible assets | 4,565 | 3,123 | 3,392 |
NLEX [Member] | Trade Name [Member] | |||
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Unamortized intangible assets | 2,437 | $ 2,437 | $ 2,437 |
ALT [Member] | Trade Name [Member] | |||
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Finite-Lived intangible asset, useful life | 20 years | ||
Finite-Lived intangible assets, remaining amortization period | 19 years 8 months 12 days | ||
Intangible assets acquired | 650 | ||
Total net amortized intangible assets | 639 | ||
Amortization | (11) | ||
Customer Relationships [Member] | HGP [Member] | |||
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Finite-Lived intangible asset, useful life | 12 years | 12 years | |
Finite-Lived intangible assets, remaining amortization period | 1 year | 2 years | |
Total net amortized intangible assets | 62 | $ 92 | |
Total net amortized intangible assets | 30 | 62 | $ 92 |
Amortization | (32) | $ (30) | |
Customer Relationships [Member] | NLEX [Member] | |||
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Finite-Lived intangible asset, useful life | 7 years 7 months 6 days | 7 years 7 months 6 days | |
Finite-Lived intangible assets, remaining amortization period | 1 year | ||
Total net amortized intangible assets | 111 | $ 221 | |
Intangible assets acquired | 0 | ||
Total net amortized intangible assets | 111 | $ 221 | |
Amortization | (110) | $ 110 | |
HGP Trade Name [Member] | |||
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Finite-Lived intangible asset, useful life | 14 years | 14 years | |
Finite-Lived intangible assets, remaining amortization period | 3 years | 4 years | |
Total net amortized intangible assets | 513 | $ 642 | |
Total net amortized intangible assets | 386 | 513 | $ 642 |
Amortization | $ (128) | $ (129) | |
Vendor Relationships [Member] | ALT [Member] | |||
Finite And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Finite-Lived intangible asset, useful life | 5 years | ||
Finite-Lived intangible assets, remaining amortization period | 5 years | 4 years 8 months 12 days | |
Intangible assets acquired | $ 1,150 | ||
Total net amortized intangible assets | 1,073 | ||
Amortization | $ (77) |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2014 | Dec. 31, 2012 | |
Finite Lived Intangible Assets [Line Items] | |||||
Amortization expense, intangible assets | $ 358 | $ 269 | |||
Residual value intangible assets | $ 0 | 0 | |||
Goodwill | 7,446 | 7,446 | 5,585 | ||
Impairment of goodwill | 0 | ||||
Impairment charges | 0 | ||||
HGP [Member] | |||||
Finite Lived Intangible Assets [Line Items] | |||||
Goodwill | 2,040 | 2,040 | 2,040 | $ 2,000 | |
NLEX [Member] | |||||
Finite Lived Intangible Assets [Line Items] | |||||
Goodwill | 3,545 | 3,545 | 3,545 | $ 3,500 | |
ALT [Member] | |||||
Finite Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 1,861 | $ 1,861 | $ 0 |
Intangible Assets- Schedule of
Intangible Assets- Schedule of Estimated Amortization Expense (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
2022 | $ 421 |
2023 | 391 |
2024 | 391 |
2025 | 262 |
2026 | 186 |
Thereafter | 477 |
Total | $ 2,128 |
Intangible Assets- Schedule o_2
Intangible Assets- Schedule of Goodwill (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2014 | Dec. 31, 2012 |
Finite Lived Intangible Assets [Line Items] | ||||
Goodwill | $ 7,446 | $ 5,585 | ||
HGP [Member] | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Goodwill | 2,040 | 2,040 | $ 2,000 | |
NLEX [Member] | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Goodwill | 3,545 | 3,545 | $ 3,500 | |
ALT [Member] | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Goodwill | $ 1,861 | $ 0 |
Accounts Receivable and Accou_3
Accounts Receivable and Accounts Payable (Narrative) (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts Receivable And Accounts Payable [Abstract] | ||
Allowance for doubtful accounts | $ 122,000 | $ 0 |
Schedule of Accounts Payable an
Schedule of Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Payables And Accruals [Abstract] | ||
Due to auction clients | $ 6,433 | $ 8,026 |
Remuneration and benefits | 1,909 | 2,498 |
Due to Joint Venture partners | 402 | 1,349 |
Sales and other taxes | 226 | 831 |
Accrued asset liquidation expenses | 1,340 | 346 |
Accounting, auditing and tax consulting | 184 | 166 |
Customer Deposits | 407 | 0 |
Other | 343 | 393 |
Total accounts payable and accrued liabilities | $ 11,244 | $ 13,609 |
Schedule of Debt (Details)
Schedule of Debt (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Current | |
Third party debt | $ 2,479 |
Non-current: | |
Third party debt | 1,352 |
Total third party debt | $ 3,831 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | Aug. 23, 2021 | May 11, 2021 | Feb. 10, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Heritage Global LLC [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit | $ 2,000,000 | ||||
Debt instrument, Maturity date | Aug. 23, 2025 | ||||
Interest rate per annum | 3.00% | ||||
Litigation settlement installments amount due | $ 44,000 | ||||
Debt Outstanding Amount | $ 1,900,000 | ||||
Wall Street Journal prime rate [Member] | Heritage Global LLC [Member] | |||||
Debt Instrument [Line Items] | |||||
Interest rate per annum | 1.70% | ||||
Wall Street Journal prime rate [Member] | Minimum [Member] | Heritage Global LLC [Member] | |||||
Debt Instrument [Line Items] | |||||
Interest rate per annum | 4.95% | ||||
Revolving Line of Credit [Member] | Heritage Global LLC [Member] | |||||
Debt Instrument [Line Items] | |||||
Convert From Revolving Debt To Term Debt | 5,000,000 | ||||
First Choice Bank [Member] | Revolving Line of Credit [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit | $ 0 | ||||
Line of credit, repayment | 5,600,000 | ||||
Line of credit, drawn amount | $ 5,600,000 | ||||
First Choice Bank [Member] | Revolving Line of Credit [Member] | Heritage Global LLC [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit | 1,900,000 | ||||
Line of credit, repayment | 1,300,000 | ||||
Line of credit, drawn amount | $ 3,200,000 | ||||
C3bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit | $ 5,000,000 | ||||
Debt instrument, Maturity date | Apr. 5, 2021 | ||||
C3bank [Member] | Heritage Global LLC [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit | $ 10,000,000 | ||||
Debt instrument, Maturity date | May 11, 2023 | ||||
C3bank [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Interest rate per annum | 5.50% |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jan. 31, 2018 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2014 | |
Income Taxes [Line Items] | |||||
Deferred Tax Assets Net | $ 4,488 | $ 4,402 | $ 0 | ||
Operating loss carryforwards | $ 77,800 | ||||
Operating Loss Carryforwards, Expiration Date | Substantially all of the net operating loss carry forwards and unused minimum tax credit carry forwards expire between 2024 and 2037. | ||||
Operating Loss Carryforwards, Limitations on Use | The Company’s utilization of restricted net operating tax loss carry forwards against future income for tax purposes is restricted pursuant to the “change in ownership” rules in Section 382 of the Internal Revenue Code. These rules, in general, provide that an ownership change occurs when the percentage shareholdings of 5% direct or indirect stockholders of a loss corporation have, in aggregate, increased by more than 50 percentage points during the immediately preceding three years.Restrictions in net operating loss carry forwards occurred in 2001 as a result of the acquisition of the Company by Street Capital. Pursuant to Section 382 of the Internal Revenue Code, the annual usage of the Company’s net operating loss carry forwards was limited to approximately $2.5 million per annum until 2008 and $1.7 million per annum thereafter. There is no certainty that the application of these “change in ownership” rules may not recur, resulting in further restrictions on the Company’s income tax loss carry forwards existing at a particular time. In addition, further restrictions, reductions in, or expiration of net operating loss and net capital loss carry forwards may occur through future merger, acquisition and/or disposition transactions or failure to continue a significant level of business activities. Any such additional limitations could require the Company to pay income taxes on its future earnings and record an income tax expense to the extent of such liability, despite the existence of such tax loss carry forwards. | ||||
Open Tax Year | 2018 | 2020 | 2019 | ||
Reduction in Deferred Tax Assets | $ 4,400 | ||||
Total Unrecognized Tax Benefits | $ 4,500 | ||||
NLEX [Member] | |||||
Income Taxes [Line Items] | |||||
Deferred income tax liabilities net | 600 | ||||
Trade Names [Member] | Indefinite-Lived [Member] | NLEX [Member] | |||||
Income Taxes [Line Items] | |||||
Identifiable intangible assets | $ 2,400 | ||||
Operating Loss Carryforwards Per Year After 2008 [Member] | |||||
Income Taxes [Line Items] | |||||
Operating Loss Carryforwards, Limitations on Use | The Company’s utilization of restricted net operating tax loss carry forwards against future income for tax purposes is restricted pursuant to the “change in ownership” rules in Section 382 of the Internal Revenue Code. These rules, in general, provide that an ownership change occurs when the percentage shareholdings of 5% direct or indirect stockholders of a loss corporation have, in aggregate, increased by more than 50 percentage points during the immediately preceding three years.Restrictions in net operating loss carry forwards occurred in 2001 as a result of the acquisition of the Company by Street Capital. Pursuant to Section 382 of the Internal Revenue Code, the annual usage of the Company’s net operating loss carry forwards was limited to approximately $2.5 million per annum until 2008 and $1.7 million per annum thereafter. | ||||
Unrestricted [Member] | |||||
Income Taxes [Line Items] | |||||
Operating loss carryforwards | $ 62,200 | ||||
Restricted [Member] | |||||
Income Taxes [Line Items] | |||||
Operating loss carryforwards | $ 15,600 |
Summary of Change in Valuation
Summary of Change in Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Beginning balance | $ 13,097 | $ 17,639 |
Change during the period | (855) | (4,542) |
Ending balance | $ 12,242 | $ 13,097 |
Schedule of Components of Incom
Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Expected federal statutory tax expense | $ 628 | $ 1,263 |
Increase (reduction) in taxes resulting from: | ||
State income taxes recoverable | 43 | 388 |
Non-deductible expenses (permanent differences) | (707) | (193) |
Change in valuation allowance | (855) | (4,542) |
Tax rate changes | 876 | (599) |
Other | (46) | 39 |
Income tax benefit | $ (61) | $ (3,644) |
Schedule of Deferred Tax Assets
Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2014 |
Income Taxes [Line Items] | ||||
Net operating loss carry forwards | $ 16,824 | $ 17,623 | ||
Stock based compensation | 1,095 | 1,007 | ||
Equity method investments | (477) | (478) | ||
Other | 29 | 152 | ||
Gross deferred tax assets | 16,730 | 17,499 | ||
Less: valuation allowance | (12,242) | (13,097) | $ (17,639) | |
Deferred tax assets, net of valuation allowance | 4,488 | 4,402 | $ 0 | |
Trade Names And Customer Relationships [Member] | ||||
Income Taxes [Line Items] | ||||
Trade names and customer relationships | $ (741) | $ (805) |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Senior Officer of NLEX [Member] | Lease Amounts [Member] | Edwardsville, IL [Member] | Selling, General and Administrative Expenses [Member] | ||
Related Party Transaction [Line Items] | ||
Payment to related party | $ 110,000 | $ 110,000 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - USD ($) | Apr. 08, 2021 | Oct. 06, 2020 | Nov. 25, 2019 | Jun. 30, 2018 | Dec. 31, 2016 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 31, 2003 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Class Of Stock [Line Items] | |||||||||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | |||||||||
Common stock, par value | $ 0.01 | $ 0.01 | |||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |||||||||
Preferred stock, par value | $ 10 | $ 10 | |||||||||
Options, Exercised (in shares) | 1,895,437 | 383,350 | |||||||||
Convertible Preferred Stock, Shares Issuable upon Conversion | the Company’s shares of Series N preferred stock, each of which is convertible to 40 common shares, have the right to receive dividends or dividend equivalents should the Company declare dividends on its common stock. | ||||||||||
Series N preferred shares, conversion price per share | $ 1,000 | ||||||||||
Series N preferred stock, each convertible to common shares | 40 | ||||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 4 | ||||||||||
Term of Stock-Based Compensation Plan | 6 years 7 months 6 days | 6 years 9 months 18 days | |||||||||
Options to purchase, Granted (in shares) | 25,000 | 722,500 | 474,750 | ||||||||
Exercise Price, Outstanding | $ 1.23 | $ 0.63 | $ 0.51 | ||||||||
Exercise price, options granted in period | $ 2.28 | $ 1.62 | |||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 4 | ||||||||||
Stock-based compensation expense | $ 408,000 | $ 353,000 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 1,214,938 | 950,125 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | $ 0.96 | $ 0.71 | |||||||||
Unrecognized stock-based compensation | $ 1,200,000 | ||||||||||
Unrecognized stock-based compensation, Period for recognition | 3 years 1 month 6 days | ||||||||||
Fair Value of Options Vested in Period | $ 200,000 | $ 300,000 | |||||||||
Aggregate intrinsic value of exercisable options | 1,300,000 | 6,300,000 | |||||||||
Unrecognized stock-based compensation expense | $ 73,000 | $ 125,000 | |||||||||
Other Options Issued [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options, Exercised (in shares) | 22,500 | 10,625 | |||||||||
Options to purchase, Granted (in shares) | 625,000 | 150,000 | 90,000 | ||||||||
Exercise price, options granted in period | $ 1.78 | $ 1.41 | |||||||||
Restricted Stock [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Shares restriction term of service | 2 years | ||||||||||
Unrecognized stock-based compensation expense | $ 0 | ||||||||||
Annual Compensation Plan [Member] | Stock Options [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options, Exercised (in shares) | 1,895,437 | 383,350 | |||||||||
Tax benefit recognized | $ 1,000,000 | $ 200,000 | |||||||||
Annual Compensation Plan [Member] | Stock Options [Member] | Selling, General and Administrative Expenses [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Stock-based compensation expense | $ 400,000 | $ 400,000 | |||||||||
2003 Stock Option and Appreciation Rights Plan [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 2,000,000 | ||||||||||
Term of Stock-Based Compensation Plan | 10 years | ||||||||||
Options to purchase, Granted (in shares) | 0 | 0 | |||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 2,000,000 | ||||||||||
2010 Non-Qualified Stock Option Plan [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options, Exercised (in shares) | 793,750 | ||||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 1,250,000 | ||||||||||
Options to purchase, Granted (in shares) | 50,000 | 125,000 | |||||||||
Stock Option Award Vesting Period | 4 years | ||||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 1,250,000 | ||||||||||
2010 Non-Qualified Stock Option Plan [Member] | Minimum [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Exercise Price, Outstanding | $ 0.24 | ||||||||||
2010 Non-Qualified Stock Option Plan [Member] | Maximum [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Exercise Price, Outstanding | $ 2.85 | ||||||||||
2010 Non-Qualified Stock Option Plan [Member] | Directors [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options to purchase, Granted (in shares) | 50,000 | 60,000 | |||||||||
2010 Non-Qualified Stock Option Plan [Member] | Newly Appointed Independent Directors [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options to purchase, Granted (in shares) | 50,000 | ||||||||||
2010 Non-Qualified Stock Option Plan [Member] | Outside Consultant [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options to purchase, Granted (in shares) | 15,000 | ||||||||||
2016 Stock Option Plan [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Options, Exercised (in shares) | 1,079,187 | 372,725 | |||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 3,150,000 | ||||||||||
Options to purchase, Granted (in shares) | 2,539,200 | 522,500 | 259,750 | ||||||||
Stock Option Award Vesting Period | 4 years | ||||||||||
Number of Shares Authorized for Stock-Based Compensation Plan | 3,150,000 | ||||||||||
2016 Stock Option Plan [Member] | Minimum [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Exercise Price, Outstanding | $ 0.45 | ||||||||||
2016 Stock Option Plan [Member] | Maximum [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Exercise Price, Outstanding | $ 3.33 | ||||||||||
Common Stock [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of common stock in public offering, net, shares | 5,462,500 | ||||||||||
Options, Exercised (in shares) | 1,268,399 | 274,582 | |||||||||
Issuance of common stock for services rendered, shares | 205,000 | ||||||||||
Issuance of restricted common stock (in shares) | 25,000 | ||||||||||
Series N preferred shares, conversion price per share | $ 1,000 | ||||||||||
Series N preferred stock, each convertible to common shares | 120 | ||||||||||
Preferred Stock [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Convertible Preferred Stock, Shares Issuable upon Conversion | Each share of Series N preferred stock has a voting entitlement equal to 40 common shares, votes with the common stock on an as-converted basis and is senior to all other preferred stock of the Company. Dividends, if any, will be paid on an as-converted basis equal to common stock dividends. The conversion value of each share of Series N preferred stock is $1,000, and each share is convertible to 40 common shares at the rate of $25.00 per common share. The holders of shares of Series N preferred stock are entitled to liquidation preference over common stockholders equivalent to $1,000 per share. | ||||||||||
Share price | $ 25 | ||||||||||
Conversion of series N preferred stock to shares of common stock | 0 | ||||||||||
Maxim Group LLC [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of common stock for services rendered, shares | 205,000 | ||||||||||
IPO [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of common stock in public offering, net, shares | 5,462,500 | ||||||||||
Public offering price | $ 1.75 | ||||||||||
Additional issuance of underwritten public offering share | 712,500 | ||||||||||
Proceeds from underwritten public offering net of underwriting discounts and commissions | $ 8,700,000 | ||||||||||
David Ludwig And Tom Ludwig [Member] | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of restricted common stock (in shares) | 600,000 | ||||||||||
Stock-based compensation expense | $ 52,000 | $ 52,000 | |||||||||
Shares restriction term of service | 5 years | ||||||||||
Weighted average grant date fair value | $ 0.43 | $ 0.43 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of 2003 Stock Option and Appreciation Rights Plan (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Options outstanding, beginning of year | 3,516,225 | 3,611,850 |
Options expired | 0 | (20,000) |
Options forfeited | (150,000) | (167,025) |
Options outstanding, end of year | 2,193,288 | 3,516,225 |
2003 Stock Option and Appreciation Rights Plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Options outstanding, beginning of year | 0 | 20,000 |
Options expired | (20,000) | |
Options outstanding, end of year | 0 | 0 |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of 2010 Non-Qualified Stock Option Plan (Details) - shares | Apr. 08, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options outstanding, beginning of year | 3,516,225 | 3,611,850 | |
Options granted | 25,000 | 722,500 | 474,750 |
Options exercised | (1,895,437) | (383,350) | |
Options forfeited | (150,000) | (167,025) | |
Options outstanding, end of year | 2,193,288 | 3,516,225 | |
2010 Non-Qualified Stock Option Plan [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options outstanding, beginning of year | 1,100,000 | 975,000 | |
Options granted | 50,000 | 125,000 | |
Options exercised | (793,750) | ||
Options forfeited | (25,000) | ||
Options outstanding, end of year | 331,250 | 1,100,000 |
Stockholders' Equity - Schedu_3
Stockholders' Equity - Schedule of Other Stock Options Issued (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Options outstanding, beginning of year | 3,516,225 | 3,611,850 |
Options exercised | (1,895,437) | (383,350) |
Options forfeited | (150,000) | (167,025) |
Options expired | 0 | (20,000) |
Options outstanding, end of year | 2,193,288 | 3,516,225 |
Other Options Issued [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Options outstanding, beginning of year | 344,375 | 265,000 |
Options issued | 150,000 | 90,000 |
Options exercised | (22,500) | (10,625) |
Options forfeited | (67,500) | |
Options outstanding, end of year | 404,375 | 344,375 |
Stockholders' Equity - Schedu_4
Stockholders' Equity - Schedule of Heritage Global Inc. 2016 Stock Option Plan (Details) - shares | Apr. 08, 2021 | Dec. 31, 2016 | Dec. 31, 2021 | Dec. 31, 2020 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Options outstanding, beginning of year | 3,516,225 | 3,611,850 | ||
Options granted | 25,000 | 722,500 | 474,750 | |
Options exercised | (1,895,437) | (383,350) | ||
Options forfeited | (150,000) | (167,025) | ||
Options outstanding, end of year | 2,193,288 | 3,516,225 | ||
2016 Stock Option Plan [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Options outstanding, beginning of year | 2,071,850 | 2,351,850 | ||
Options granted | 2,539,200 | 522,500 | 259,750 | |
Options exercised | (1,079,187) | (372,725) | ||
Options forfeited | (57,500) | (167,025) | ||
Options outstanding, end of year | 1,457,663 | 2,071,850 |
Stockholders' Equity - Schedu_5
Stockholders' Equity - Schedule of Assumptions for Fair Value of Option Grant (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Risk-free interest rate (Minimum) | 0.00% | 0.00% |
Risk-free interest rate (Maximum) | 1.00% | 2.00% |
Expected life (years) | 6 years 7 months 6 days | 6 years 9 months 18 days |
Expected volatility | 80.00% | 74.00% |
Expected dividend yield | 0.00% | 0.00% |
Stockholders' Equity - Schedu_6
Stockholders' Equity - Schedule of Changes in Common Stock Options (Details) - $ / shares | Apr. 08, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||
Options outstanding, beginning of year | 3,516,225 | 3,611,850 | |
Options granted | 25,000 | 722,500 | 474,750 |
Options, Exercised | (1,895,437) | (383,350) | |
Options, Expired | 0 | (20,000) | |
Options, Forfeited | (150,000) | (167,025) | |
Options outstanding, end of year | 2,193,288 | 3,516,225 | |
Options exercisable at year end | 978,350 | 2,566,100 | |
Weighted Average Exercise Price, Outstanding at beginning of year | $ 0.63 | $ 0.51 | |
Weighted Average Exercise Price, Granted | 2.28 | 1.62 | |
Weighted Average Exercise Price, Exercised | 0.48 | 0.46 | |
Weighted Average Exercise Price, Expired | 0 | 0.83 | |
Weighted Average Exercise Price, Forfeited | 1.61 | 1.15 | |
Weighted Average Exercise Price, Outstanding at end of year | 1.23 | 0.63 | |
Weighted Average Exercise Price, Options exercisable at end of year | 0.60 | 0.47 | |
Weighted-average fair value of options granted during the year | $ 1.59 | $ 1.64 |
Stockholders' Equity - Schedu_7
Stockholders' Equity - Schedule of Information about All Stock Options Outstanding (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Outstanding | 2,193,288 | 3,516,225 | 3,611,850 |
Options Outstanding, Weighted Average Exercise Price | $ 1.23 | $ 0.63 | $ 0.51 |
Number Exercisable | 978,350 | 2,566,100 | |
Number Exercisable, Weighted Average Exercise Price | $ 0.60 | $ 0.47 | |
Exercise Price $0.24 to $0.48 [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Outstanding | 742,225 | ||
Options Outstanding, Weighted Average Remaining Life (years) | 5 years | ||
Options Outstanding, Weighted Average Exercise Price | $ 0.44 | ||
Number Exercisable | 700,600 | ||
Number Exercisable, Weighted Average Remaining Life (years) | 4 years 10 months 24 days | ||
Number Exercisable, Weighted Average Exercise Price | $ 0.44 | ||
Exercise Price $0.53 to $0.95 [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Outstanding | 501,063 | ||
Options Outstanding, Weighted Average Remaining Life (years) | 7 years 8 months 12 days | ||
Options Outstanding, Weighted Average Exercise Price | $ 0.76 | ||
Number Exercisable | 212,750 | ||
Number Exercisable, Weighted Average Remaining Life (years) | 7 years 7 months 6 days | ||
Number Exercisable, Weighted Average Exercise Price | $ 0.76 | ||
Exercise Price $1.41 to $1.90 [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Outstanding | 612,500 | ||
Options Outstanding, Weighted Average Remaining Life (years) | 9 years 3 months 18 days | ||
Options Outstanding, Weighted Average Exercise Price | $ 1.47 | ||
Number Exercisable | 47,500 | ||
Number Exercisable, Weighted Average Remaining Life (years) | 8 years 6 months | ||
Number Exercisable, Weighted Average Exercise Price | $ 1.47 | ||
Exercise Price $2.77 to $3.33 [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Outstanding | 337,500 | ||
Options Outstanding, Weighted Average Remaining Life (years) | 9 years 2 months 12 days | ||
Options Outstanding, Weighted Average Exercise Price | $ 2.77 | ||
Number Exercisable | 17,500 | ||
Number Exercisable, Weighted Average Remaining Life (years) | 8 years 7 months 6 days | ||
Number Exercisable, Weighted Average Exercise Price | $ 2.77 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Net operating income (loss) | $ 3,014 | $ 6,059 |
Industrial Assets Division [Member] | ||
Net operating income (loss) | 3,393 | 5,764 |
Financial Assets Division [Member] | ||
Net operating income (loss) | 2,024 | 2,637 |
Corporate and Other [Member] | ||
Net operating income (loss) | $ (2,403) | $ (2,342) |