Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 10, 2021 | |
Document Information Line Items | ||
Entity Registrant Name | COMSOVEREIGN HOLDING CORP. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 79,934,456 | |
Amendment Flag | false | |
Entity Central Index Key | 0001178727 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 333-150332 | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 46-5538504 | |
Entity Address, Address Line One | 5000 Quorum Drive | |
Entity Address, Address Line Two | Suite 400 | |
Entity Address, City or Town | Dallas | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75254 | |
City Area Code | (904) | |
Local Phone Number | 834-4400 | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheet - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 2,869 | $ 731 |
Accounts receivable, net | 1,943 | 787 |
Inventory, net | 10,819 | 4,538 |
Prepaid expenses | 6,734 | 1,473 |
Other current assets | 417 | 152 |
Total Current Assets | 22,782 | 7,681 |
Property and equipment, net | 9,796 | 2,286 |
Operating lease right-of-use assets | 3,867 | 2,725 |
Finance lease right-of-use-assets | 216 | 68 |
Intangible assets, net | 48,035 | 53,188 |
Goodwill | 103,604 | 64,898 |
Other assets – long term | 95 | 31 |
Total Assets | 188,395 | 130,877 |
Current Liabilities | ||
Accounts payable | 4,114 | 5,583 |
Accrued interest | 424 | 2,029 |
Accrued liabilities | 1,210 | 1,649 |
Accrued liabilities – related party | 86 | 30 |
Accrued payroll | 1,222 | 3,992 |
Contract liabilities, current | 2,932 | 721 |
Accrued warranty liability | 185 | |
Operating lease liabilities, current | 1,021 | 676 |
Finance lease liabilities, current | 66 | 46 |
Notes payable – related party | 160 | 1,010 |
Current portion of long-term debt, net of unamortized discounts and debt issuance costs | 12,354 | 18,340 |
Total Current Liabilities | 23,589 | 34,262 |
Debt – long term, net of unamortized discounts and debt issuance costs | 18,077 | 706 |
Contract liabilities – long term | 122 | 143 |
Accrued warranty liability – long term | 457 | |
Operating lease liabilities – long term | 3,012 | 2,209 |
Finance lease liabilities – long term | 138 | 9 |
Total Liabilities | 45,395 | 37,329 |
COMMITMENTS AND CONTINGENCIES (Note 17) | ||
STOCKHOLDERS’ EQUITY | ||
Preferred stock, $0.0001 par value, 100,000,000 shares authorized, no shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | ||
Common stock, $0.0001 par value, 300,000,000 shares authorized, 72,533,850 and 49,444,689 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | 17 | 15 |
Additional paid-in capital | 245,132 | 158,210 |
Accumulated deficit | (102,099) | (64,627) |
Treasury stock, at cost, 100,000 shares as of September 30, 2021 and December 31, 2020, respectively | (50) | (50) |
Total Stockholders’ Equity | 143,000 | 93,548 |
Total Liabilities and Stockholders’ Equity | $ 188,395 | $ 130,877 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheet (Parentheticals) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 72,533,850 | 49,444,689 |
Common stock, shares outstanding | 72,533,850 | 49,444,689 |
Treasury stock, at cost | 100,000 | 100,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statement of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue | $ 4,115 | $ 2,018 | $ 9,812 | $ 7,513 |
Cost of Goods Sold | 1,819 | 859 | 4,706 | 3,473 |
Gross Profit | 2,296 | 1,159 | 5,106 | 4,040 |
Operating Expenses | ||||
Research and development | 2,061 | 562 | 3,805 | 1,263 |
Sales and marketing | 247 | 1 | 449 | 31 |
General and administrative | 6,464 | 4,471 | 20,543 | 13,152 |
Depreciation and amortization | 3,834 | 2,909 | 11,034 | 8,654 |
Impairment expense | 281 | |||
Gain on the sale of assets | 48 | (83) | (1) | |
Total Operating Expenses | 12,654 | 7,943 | 36,029 | 23,099 |
Net Operating Loss | (10,358) | (6,784) | (30,923) | (19,059) |
Other Income (Expense) | ||||
Interest expense | (724) | (3,350) | (1,740) | (5,707) |
Other income (expense) | 1 | (129) | (116) | (129) |
Gain/(Loss) on extinguishment of debt | 298 | (22) | (4,725) | (22) |
Foreign currency transaction gain/(loss) | 94 | (46) | 32 | (6) |
Interest income | 1 | |||
Total Other Expenses | (331) | (3,547) | (6,549) | (5,863) |
Net Loss | $ (10,689) | $ (10,331) | $ (37,472) | $ (24,922) |
Loss per common share: | ||||
Basic and Diluted (in Dollars per share) | $ (0.15) | $ (0.23) | $ (0.56) | $ (0.56) |
Weighted-average shares outstanding: | ||||
Basic and Diluted (in Shares) | 71,994,529 | 44,216,540 | 66,388,447 | 44,155,510 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Comprehensive Loss(Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Net Loss | $ (10,689) | $ (10,331) | $ (37,472) | $ (24,922) |
Other Comprehensive Loss: | ||||
Foreign currency translation adjustment | 22 | 23 | ||
Total Comprehensive Loss | $ (10,689) | $ (10,309) | $ (37,472) | $ (24,899) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity(Unaudited) - USD ($) $ in Thousands | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Treasury Shares | Accumulated Deficit | Total |
Balance at Dec. 31, 2019 | $ 13 | $ 130,553 | $ (23) | $ (50) | $ (27,545) | $ 102,948 | |
Balance (in Shares) at Dec. 31, 2019 | 42,775,415 | ||||||
Issuance of common stock for settlement of accounts payable | 193 | 193 | |||||
Issuance of common stock for settlement of accounts payable (in Shares) | 55,032 | ||||||
Issuance of common stock for debt issue costs | 57 | 57 | |||||
Issuance of common stock for debt issue costs (in Shares) | 16,667 | ||||||
Foreign currency translation adjustment | 1 | 1 | |||||
Net loss | (7,026) | (7,026) | |||||
Balance at Mar. 31, 2020 | $ 13 | 130,803,318 | (22) | (50) | (34,571) | 96,173 | |
Balance (in Shares) at Mar. 31, 2020 | 42,847,114 | ||||||
Balance at Dec. 31, 2019 | $ 13 | 130,553 | (23) | (50) | (27,545) | 102,948 | |
Balance (in Shares) at Dec. 31, 2019 | 42,775,415 | ||||||
Net loss | (24,922) | ||||||
Balance at Sep. 30, 2020 | $ 14 | 156,196 | (50) | (52,467) | 103,693 | ||
Balance (in Shares) at Sep. 30, 2020 | 47,939,205 | ||||||
Balance at Mar. 31, 2020 | $ 13 | 130,803,318 | (22) | (50) | (34,571) | 96,173 | |
Balance (in Shares) at Mar. 31, 2020 | 42,847,114 | ||||||
Net loss | (7,565) | (7,565) | |||||
Balance at Jun. 30, 2020 | $ 13 | 130,957 | (22) | (50) | (42,136) | 88,762 | |
Balance (in Shares) at Jun. 30, 2020 | 42,948,690 | ||||||
Issuance of common stock for exercise of warrants | 3 | 3 | |||||
Issuance of common stock for exercise of warrants (in Shares) | 94,510 | ||||||
Issuance of common stock for payment of accrued interest | 38 | 38 | |||||
Issuance of common stock for payment of accrued interest (in Shares) | 7,066 | ||||||
Warrants issued in conjunction with debt agreements | 44 | 44 | |||||
Beneficial conversion feature | 69 | 69 | |||||
Issuance of common stock for debt issue costs | 1,340 | 1,340 | |||||
Issuance of common stock for debt issue costs (in Shares) | 133,333 | ||||||
Foreign currency translation adjustment | 22 | 22 | |||||
Issuance of common stock as vendor compensation | 268 | 268 | |||||
Issuance of common stock as vendor compensation (in Shares) | 69,337 | ||||||
Issuance of warrants as vendor compensation | 25 | 25 | |||||
Common stock issued for cash | 332 | 332 | |||||
Common stock issued for cash (in Shares) | 30,613 | ||||||
Non-cash contribution from Chief Executive Officer | 479 | 479 | |||||
Issuance of common stock for conversion of debt | 2,320 | 2,320 | |||||
Issuance of common stock for conversion of debt (in Shares) | 640,360 | ||||||
Share-based compensation | 531 | 531 | |||||
Issuance of Warrants for debt issuance costs | 104 | 104 | |||||
Issuance of common stock for extinguishment of debt and interest | 2,540 | 2,540 | |||||
Issuance of common stock for extinguishment of debt and interest (in Shares) | 204,135 | ||||||
Net loss | (10,331) | (10,331) | |||||
Balance at Sep. 30, 2020 | $ 14 | 156,196 | (50) | (52,467) | 103,693 | ||
Balance (in Shares) at Sep. 30, 2020 | 47,939,205 | ||||||
Issuance of common stock for Virtual Network Communications Inc. acquisition | $ 1 | 12,676 | 12,677 | ||||
Issuance of common stock for Virtual Network Communications Inc. acquisition (in Shares) | 3,912,737 | ||||||
Issuance of options for Virtual Network Communications Inc. acquisition | 2,261 | 2,261 | |||||
Issuance of warrants for Virtual Network Communications Inc. acquisition | 1,646 | 1,646 | |||||
Beneficial conversion feature | 567 | 567 | |||||
Issuance of warrants in conjunction with debt agreements | 150 | 150 | |||||
Balance at Dec. 31, 2020 | $ 15 | 158,210 | (50) | (64,627) | 93,548 | ||
Balance (in Shares) at Dec. 31, 2020 | 49,444,689 | ||||||
Issuance of common stock for exercise of options | 1 | 1 | |||||
Issuance of common stock for exercise of options (in Shares) | 3,334 | ||||||
Issuance of common stock as vendor compensation | 1,171 | 1,171 | |||||
Issuance of common stock as vendor compensation (in Shares) | 227,169 | ||||||
Issuance of common stock for conversion of debt | 1,602 | 1,602 | |||||
Issuance of common stock for conversion of debt (in Shares) | 580,199 | ||||||
Issuance of common stock for public offering | $ 1 | 39,655 | 39,656 | ||||
Issuance of common stock for public offering (in Shares) | 10,679,354 | ||||||
Share-based compensation | 356 | 356 | |||||
Share-based compensation (in Shares) | 66,667 | ||||||
Issuance of common stock for extinguishment of debt and interest | $ 1 | 12,382 | 12,383 | ||||
Issuance of common stock for extinguishment of debt and interest (in Shares) | 2,751,556 | ||||||
Issuance of warrants for extinguishment of debt and interest | 4,394 | 4,394 | |||||
Issuance of common stock for Sky Sapience Ltd. acquisition | 9,071 | 9,071 | |||||
Issuance of common stock for Sky Sapience Ltd. acquisition (in Shares) | 2,555,209 | ||||||
Net loss | (16,206) | (16,206) | |||||
Balance at Mar. 31, 2021 | $ 17 | 226,842 | (50) | (80,833) | 145,976 | ||
Balance (in Shares) at Mar. 31, 2021 | 66,308,177 | ||||||
Balance at Dec. 31, 2020 | $ 15 | 158,210 | (50) | (64,627) | 93,548 | ||
Balance (in Shares) at Dec. 31, 2020 | 49,444,689 | ||||||
Net loss | (37,472) | ||||||
Balance at Sep. 30, 2021 | $ 17 | 245,132 | (50) | (102,099) | 143,000 | ||
Balance (in Shares) at Sep. 30, 2021 | 72,533,850 | ||||||
Balance at Mar. 31, 2021 | $ 17 | 226,842 | (50) | (80,833) | 145,976 | ||
Balance (in Shares) at Mar. 31, 2021 | 66,308,177 | ||||||
Issuance of common stock for exercise of options | 16 | 16 | |||||
Issuance of common stock for exercise of options (in Shares) | 60,000 | ||||||
Issuance of common stock as vendor compensation | |||||||
Issuance of common stock as vendor compensation (in Shares) | 7,571 | ||||||
Share-based compensation | 526 | 526 | |||||
Issuance of common stock for RVision, Inc. acquisition | 5,500 | 5,500 | |||||
Issuance of common stock for RVision, Inc. acquisition (in Shares) | 2,000,000 | ||||||
Issuance of common stock for Innovation Digital, LLC acquisition | 7,343 | 7,343 | |||||
Issuance of common stock for Innovation Digital, LLC acquisition (in Shares) | 3,165,322 | ||||||
Issuance of Warrants for debt issuance costs | 919 | 919 | |||||
Net loss | (10,577) | (10,577) | |||||
Balance at Jun. 30, 2021 | $ 17 | 241,146 | (50) | (91,410) | 149,703 | ||
Balance (in Shares) at Jun. 30, 2021 | 71,541,070 | ||||||
Share-based compensation | 652 | 652 | |||||
Issuance of common stock for RF Engineering & Energy Resource, LLC acquisition | 2,204 | 2,204 | |||||
Issuance of common stock for RF Engineering & Energy Resource, LLC acquisition (in Shares) | 992,780 | ||||||
Issuance of Warrants for debt issuance costs | 1,130 | 1,130 | |||||
Net loss | (10,689) | (10,689) | |||||
Balance at Sep. 30, 2021 | $ 17 | $ 245,132 | $ (50) | $ (102,099) | $ 143,000 | ||
Balance (in Shares) at Sep. 30, 2021 | 72,533,850 |
Condensed Consolidated Statem_4
Condensed Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (37,472) | $ (24,922) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 1,362 | 798 |
Amortization | 9,672 | 7,847 |
Amortization of financing right-of-use asset | 17 | 8 |
Impairment Expense | 281 | |
Operating lease expense | 748 | 444 |
Bad debt expense | 207 | 648 |
Gain on the sale of assets | (83) | (1) |
Share-based compensation | 1,534 | 531 |
Amortization of debt discounts and debt issuance costs | 249 | 4,288 |
Share-based vendor payments | 1,171 | |
Other, net | 293 | |
Loss on extinguishment of debt | 4,725 | 22 |
Accounts receivable | (539) | 628 |
Inventory | (466) | (322) |
Prepaids | (5,709) | 355 |
Other current assets | (194) | (248) |
Other non-current assets | (6) | (168) |
Accounts payable | (3,800) | 2,719 |
Accrued liabilities | (796) | 420 |
Accrued payroll | (3,129) | |
Accrued interest | 106 | 1,079 |
Contract liabilities | (1,145) | 8 |
Operating lease liabilities | (503) | (274) |
(Repayments)/advances from related party | 56 | (95) |
Other current liabilities | 1,479 | |
Accrued warranty | 36 | |
Net cash (used in) operating activities | (33,736) | (4,463) |
Cash flows from investing activities: | ||
Business acquisitions, net of cash received | (4,495) | (3,146) |
Purchases of property and equipment | (3,086) | (97) |
Acquisition of intangible assets | (1,234) | |
Proceeds from disposal of property and equipment | 83 | 1 |
Net cash (used in) investing activities | (8,732) | (3,242) |
Cash flows from financing activities: | ||
Principal payment on finance lease | (40) | (12) |
Proceeds/(payments) on related party notes | (850) | 1,950 |
Payment on line of credit | (2,000) | |
Proceeds from sale of common stock from offering | 44,971 | 332 |
Offering costs | (5,315) | |
Proceeds from issuance of debt | 14,155 | 8,008 |
Proceeds from exercise of options | 17 | |
Debt issuance costs | 148 | |
Repayment of debt | (8,480) | (903) |
Net cash provided by financing activities | 44,606 | 7,375 |
Effect of exchange rates on cash | 23 | |
Net increase /(decrease) in cash, cash equivalents and restricted cash | 2,138 | (307) |
Cash, cash equivalents and restricted cash, beginning of period | 731 | 812 |
Cash, cash equivalents and restricted cash, end of period | 2,869 | 505 |
Supplemental disclosures of cash flow information: | ||
Taxes | ||
Interest | 533 | 367 |
Non-cash investing and financing activities: | ||
Debt incurred to sellers for Skyline Partners Technology LLC | 12,650 | |
Issuance of common stock for extinguishment of debt and interest | 12,382 | 2,343 |
Issuance of common stock for Sky Sapience Ltd. Acquisition | 9,071 | |
Issuance of common stock for Innovation Digital, LLC | 7,344 | |
Issuance of common stock for RVision, Inc. | 5,500 | |
Issuance of common stock for RF Engineering & Energy Resource, LLC | 2,204 | |
Acquisition of building with secured note payable | 4,480 | |
Issuance of warrants for extinguishment of debt and interest | 4,394 | |
Issuance of common stock for conversion of debt and interest | 1,602 | 286 |
Recognition of operating lease right-of-use asset and liability | 1,217 | |
Issuance of Warrants as debt issuance costs | 2,049 | 104 |
Capital asset additions transferred from inventory and prepaid | 862 | |
Debt incurred to sellers for Innovation Digital, LLC | 600 | |
Lease deposits recognized from Sky Sapience Ltd. Acquisition | 11 | |
Recognition of operating right-of-use asset and liability rent abatement | 152 | |
Debt incurred to sellers for Fast Plastics Parts LLC and Spring Creek Manufacturing, Inc. acquisition | 576 | |
Issuance of common stock to settle interest | 262 | |
Beneficial conversion feature | 636 | |
Common stock issued for payment of accounts payable | 193 | |
Common stock issued as debt issuance costs | $ 104 |
Description of Business and Bas
Description of Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business COMSovereign Holding Corp. (“the “Company”), formerly known as Drone Aviation Holding Corp., is a provider of technologically-advanced telecom solutions to network operators, mobile device carriers, governmental units and other enterprises worldwide. The Company has assembled a portfolio of communications, power and portable infrastructure technologies, capabilities and products that enable the upgrading of latent 3G networks to 4G and 4G-LTE networks and will facilitate the rapid rollout of the 5G and “next-Generation” (“nG”) networks of the future. The Company focuses on novel capabilities, including signal modulations, antennae, software, hardware and firmware technologies that enable increasingly efficient data transmission across the radio-frequency spectrum. The Company’s product solutions are complemented by a broad array of services including technical support, systems design and integration, and sophisticated research and development programs. The Company competes globally on the basis of its innovative technology, broad product offerings, high-quality and cost-effective customer solutions, as well as the scale of its global customer base and distribution. In addition, the Company believes it is in a unique position to rapidly increase its near-term domestic sales as it is among the few U.S.-based providers of telecommunications equipment and services. Corporate History of the Company The Company was incorporated under the laws of the State of Nevada on April 17, 2014. In November 2019, the Company entered into an Agreement and Plan of Merger with ComSovereign Corp., a Delaware corporation (“ComSovereign”). As a result, ComSovereign merged into a subsidiary of the Company and became a directly wholly-owned subsidiary of the Company. On January 29, 2021, the Company completed the acquisition of Skyline Partners Technology LLC, a Colorado limited liability company that does business under the name Fastback Networks (“Fastback”). Fastback, is a manufacturer of intelligent backhaul radio (IBR) systems that deliver high-performance wireless connectivity to virtually any location, including those challenged by Non-Line of Sight (NLOS) limitations. See Note 11 – Business Acquisitions On January 29, 2021, the Company, through its wholly-owned subsidiary, AZCOMS LLC (“AZCOMS”), completed the acquisition of a 140,000-square-foot building in Tucson, Arizona, and will hold and service the related debt as described in Note 13 – Debt Agreements. Business Acquisitions On February 25, 2021, the Company completed the acquisition of Sky Sapience Ltd., a company organized under the laws of the State of Israel (“SKS”). SKS is an Israeli-based manufacturer of drones with a patented tethered hovering technology that provides long-duration, mobile and all-weather Intelligence, Surveillance and Reconnaissance (ISR) capabilities to customers worldwide for both land and marine-based applications. See Note 11 – Business Acquisitions On April 1, 2021, the Company completed the acquisition of RVision, Inc., a Nevada corporation (“RVision”). RVision is a developer of technologically-advanced video and communications products and physical security solutions designed for government and private sector commercial industries. See Note 11 – Business Acquisitions On June 3, 2021, the Company completed the acquisition of Innovation Digital, LLC, a California limited liability company (“Innovation Digital”). Innovation Digital is a premier developer of “beyond state-of-the-art” mixed analog/digital signal processing solutions, intellectual property (IP) licensing, design and consulting services. See Note 11 – Business Acquisitions On July 16, 2021, the Company completed the acquisition of RF Engineering & Energy Resource, LLC, a Michigan limited liability company (“RF Engineering”). RF Engineering is a specialist in the design, outsourced manufacturing and distribution of ultra-high performance microwave antennas and other branded solutions for the wireless and wireline industries in the United States and Latin America. See Note 11 – Business Acquisitions On October 4, 2021, a Company completed the acquisition of SAGUNA Networks LTD, an Israeli-based software development company (“SAGUNA”). SAGUNA is a premier Multi-Access Edge Computing (“MEC”) cloud software developer. The acquisition significantly expanded the Company’s software technology offerings powering 5G wireless networks. See Note 19 – Business Acquisitions Each of the Company’s subsidiaries was acquired to address a different opportunity or segment within the North American and international telecom infrastructure and service market. Basis of Presentation The accompanying financial statements of the Company were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Historical information is not necessarily indicative of the Company’s future results of operations, financial position or cash flows. As described in Note 15 – Stockholders’ Equity Principles of Consolidation The results for the three and nine months ended September 30, 2021 are not necessarily indicative of the Company’s results of operations, financial position or cash flows that may be expected for the full fiscal year or future operating periods. The unaudited Condensed Consolidated Financial Statements included herein should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. The unaudited Condensed Consolidated Financial Statements as of, and for the three and nine months ended, September 30, 2021 and 2020 include the accounts of the Company and its subsidiaries: Drone AFS Corp., Lighter Than Air Systems Corp., DragonWave, Lextrum, Silver Bullet, VEO, InduraPower, Sovereign Plastics, VNC, Fastback, SKS, AZCOMS, RVision, Innovation Digital and RF Engineering. All intercompany transactions and accounts have been eliminated. Reclassifications Certain immaterial September 30, 2020 amounts have been reclassified to be consistent with the current period presentation. Use of Estimates The preparation of unaudited financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Estimates are used in accounting for, among other items, interest borrowing rates, valuation of equity securities in share-based payments, valuation of equity securities in debt issuances, valuation of acquired intangible assets, useful lives for depreciation and amortization of long-lived assets, valuation of future cash flows associated with impairment testing for goodwill, indefinite-lived intangible assets and other long-lived assets, deferred tax assets, uncertain income tax positions and contingencies. Actual results may ultimately differ from estimates, although management does not generally believe such differences would materially affect the financial statements in any individual year. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES There have been no material changes in the Company’s significant accounting policies as of and for the nine months ended September 30, 2021, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Acquisitions The Company accounts for business combinations under the acquisition method of accounting, in accordance with ASC Topic 805, Business Combinations Accounting Standards Not Yet Adopted The Company applies the guidance of Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. The Company recognizes the fair value of assets acquired and liabilities assumed in transactions; establishes the acquisition date fair value as the measurement objective for all assets acquired and liabilities assumed; expenses transaction and restructuring costs; and discloses the information needed to evaluate and understand the nature and financial effect of the business combination. In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Business Combination (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Earnings Per Share Potential common shares issuable to employees, non-employees and directors upon exercise or conversion of shares are excluded from the computation of diluted earnings per common share when the effect would be anti-dilutive. All potential common shares are anti-dilutive in periods of net loss available to common shareholders. Stock options and warrants are anti-dilutive when the exercise price of these instruments is greater than the average market price of the Company’s common stock for the period (out-of-the-money), regardless of whether the Company is in a period of net loss available to common shareholders. The following weighted-average potential common shares were excluded from the diluted loss per common share as their effect was anti-dilutive as of September 30, 2021 and 2020, respectively: stock options of 2,513,513 and 2,548,345, unvested restricted stock units of 330,046 and 314,938, warrants of 8,815,210 and 94,465, and convertible notes that, if converted, would result in an estimated 2,391,336 and 229,348 shares of common stock. |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | 3. GOING CONCERN U.S. GAAP requires management to assess a company’s ability to continue as a going concern within one year from the financial statement issuance and to provide related note disclosures in certain circumstances. The accompanying Unaudited Condensed Consolidated Financial Statements and notes have been prepared assuming the Company will continue as a going concern. For the nine months ended September 30, 2021, the Company generated negative cash flows from operations of $33.4 million and had an accumulated deficit of $102.1 million. Management anticipates that the Company will be dependent, for the near future, on additional debt facilities or investment capital to fund growth initiatives. The Company intends to position itself so that it will be able to raise additional funds through the capital markets, including but not limited to, securing a line or lines of credit, the issuance of debt, and/or accessing the equity markets. The Company’s fiscal operating results, negative working capital and accumulated deficit, among other factors, raise substantial doubt about the Company’s ability to continue as a going concern. The Company will continue to pursue the actions outlined above, as well as work towards increasing revenue and operating cash flows to meet its future liquidity requirements. However, there can be no assurance that the Company will be successful in any capital-raising efforts that it may undertake, and the failure of the Company to raise additional capital could adversely affect its future operations and viability. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue Disclosure [Abstract] | |
REVENUE | 4. REVENUE The following table is a summary of the Company’s timing of revenue recognition for the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine months ended (Amounts in thousands) 2021 2020 2021 2020 Timing of revenue recognition: Services and products transferred at a point in time $ 3,979 $ 1,941 $ 9,348 $ 7,056 Services and products transferred over time 136 77 464 457 Total revenue $ 4,115 $ 2,018 $ 9,812 $ 7,513 The Company disaggregates revenue by source and geographic destination to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Revenue by source consisted of the following for the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine months ended (Amounts in thousands) 2021 2020 2021 2020 Revenue by products and services: Products $ 3,847 $ 1,726 $ 8,713 $ 6,298 Services 268 292 1,099 1,215 Total revenue $ 4,115 $ 2,018 $ 9,812 $ 7,513 Revenue by geographic destination consisted of the following for the for the three and nine months ended September 30, 2021 and 2020: Three Months Ended Nine months ended (Amounts in thousands) 2021 2020 2021 2020 Revenue by geography: North America $ 3,665 $ 1,831 $ 7,945 $ 6,755 International 450 187 1,867 758 Total revenue $ 4,115 $ 2,018 $ 9,812 $ 7,513 Contract Balances The Company records contract assets when it has a right to consideration and records accounts receivable when it has an unconditional right to consideration. Contract liabilities consist of cash payments received (or unconditional rights to receive cash) in advance of fulfilling performance obligations. As of September 30, 2021, the Company did not have a contract assets balance. The following table is a summary of the Company’s opening and closing balances of contract liabilities related to contracts with customers. (Amounts in thousands) Total Balance at December 31, 2020 $ 864 Increase 2,190 Balance at September 30, 2021 $ 3,054 The amount of revenue recognized in the nine months ended September 30, 2021 that was included in the prior period contract liability balance was $2.2 million. This revenue consisted of services provided to customers who had been invoiced prior to the current year. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 9 Months Ended |
Sep. 30, 2021 | |
Cash and Cash Equivalents [Abstract] | |
CASH AND CASH EQUIVALENTS | 5. CASH AND CASH EQUIVALENTS Cash and cash equivalents consisted of the following as of September 30, 2021 and December 31, 2020: (Amounts in US$’s) September 30, December 31, Cash and cash equivalents $ 2,449 $ 731 Restricted cash 420 — Total cash, cash equivalents and restricted cash in the Statement of Cash Flows $ 2,869 $ 731 |
Accounts Receivable, Net
Accounts Receivable, Net | 9 Months Ended |
Sep. 30, 2021 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
ACCOUNTS RECEIVABLE, NET | 6. ACCOUNTS RECEIVABLE, NET Accounts receivable consisted of the following as of September 30, 2021 and December 31, 2020: (Amounts in US$’s) September 30, December 31, Account receivables $ 2,957 $ 2,474 Less: Allowance for doubtful accounts (1,014 ) (1,687 ) Total account receivables, net $ 1,943 $ 787 The Company recognized $0.0 million and $0.65 million of bad debt expense for the three months ended September 30, 2021 and 2020, respectively, and $0.2 million and $0.65 million for the nine months ended September 30, 2021 and 2020, respectively. |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2021 | |
Inventory Disclosure [Abstract] | |
INVENTORY | 7. INVENTORY Inventory consisted of the following as of September 30, 2021 and December 31, 2020: (Amounts in thousands) September 30, December 31, Raw materials $ 5,827 $ 1,765 Work in progress 1,682 461 Finished goods 4,598 3,305 Total inventory 12,107 5,531 Reserve (1,288 ) (993 ) Total inventory, net $ 10,819 $ 4,538 |
Prepaid
Prepaid | 9 Months Ended |
Sep. 30, 2021 | |
Prepaid [Abstract] | |
PREPAID | 8. PREPAID Prepaid expenses consisted of the following as of September 30, 2021 and December 31, 2020: (Amounts in thousands) September 30, December 31, Prepaid products and services $ 6,475 $ 172 Deferred offering expenses — 569 Prepaid rent and security deposit 259 732 $ 6,734 $ 1,473 |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | 9. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following as of September 30, 2021 and December 31, 2020: (Amounts in thousands) September 30, December 31, Shop machinery and equipment $ 11,556 $ 9,961 Computers and electronics 1,454 575 Office furniture and fixtures 710 348 Building 4,801 — Land 1,330 — Leasehold improvements 1,269 274 21,120 11,158 Less - accumulated depreciation (11,324 ) (8,872 ) $ 9,796 $ 2,286 The Company recognized $0.51 million and $0.28 million of depreciation expense for the three months ended September 30, 2021 and 2020, respectively, and $1.34 million and $0.8 million for the nine months ended September 30, 2021 and 2020, respectively. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases Disclosure [Abstract] | |
LEASES | 10. LEASES Operating Leases The Company has operating leases for office, manufacturing and warehouse space, office equipment, and vehicles. As part of the SKS business acquisition on February 25, 2021, the Company assumed a lease of flexible office space with a remaining term of approximately 22 months that will expire on July 1, 2023. Monthly payments are approximately $16 thousand during the remaining life of the lease. The lease did not include an implicit rate of return; therefore, the Company used an incremental borrowing rate based on other leases with similar terms. As part of the SKS business acquisition on February 25, 2021, the Company assumed vehicle leases with a remaining weighted average term of approximately 11 months. Monthly average payments are approximately $2 thousand during the remaining life of the leases. The leases included an implicit rates of return from 5.41% to 6% and no renewal options. In April 2021, the Company entered into 60-month office equipment lease with monthly payments and no renewal options. The lease did not include an implicit rate of return; therefore, the Company used an incremental borrowing rate based on other leases with similar terms. In April 2021, SKS entered into several vehicle leases with approximately 36-month terms. Monthly payments range from approximately $1 thousand to approximately $2 thousand. Each lease had an implicit rate of 6.0% and no renewal options. In May 2021, DragonWave entered into an amendment to its existing facility lease to extend the expiration date through June 20, 2022 and to increase the annual base to $12 thousand per month. The lease did not include an implicit rate of return; therefore, the Company used an incremental borrowing rate based on other leases with similar terms. The modification resulted in additional right-of-use asset and lease liability of $0.12 million As part of the RVision business acquisition on April 1, 2021, the Company assumed a lease of office space with a remaining term of approximately 33 months that will expire on March 31, 2024. Monthly payments are $7 thousand during the remaining life of the lease. The lease did not include an implicit rate of return; therefore, the Company used an incremental borrowing rate based on other leases with similar terms. Other information related to the Company’s operating leases are as follows: (Amounts in thousands) For the Operating lease ROU Asset – December 31, 2020 $ 2,725 Increase 1,890 Decrease — Amortization (748 ) Operating lease ROU Asset – September 30, 2021 $ 3,867 Operating lease liability – December 31, 2020 $ 2,885 Increase 1,883 Decrease (30 ) Amortization (705 ) Operating lease liability – September 30, 2021 $ 4,033 Operating lease liability – short term $ 1,021 Operating lease liability – long term 3,012 Operating lease liability – total $ 4,033 Operating lease cost $ 911 Variable lease cost $ — Short-term lease cost $ 129 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 890 The following table presents the weighted-average remaining lease term and weighted average discount rates related to the Company’s operating leases as of September 30, 2021 and December 31, 2020, respectively: September 30, December 31, Weighted average remaining lease term 6.13 years 4.19 years Weighted average discount rate 4.4 % 5.95 % The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the lease liabilities recorded on the Condensed Consolidated Balance Sheet as of September 30, 2021: (Amounts in thousands) Operating Remainder of 2021 $ 358 2022 1,240 2023 1,104 2024 767 2025 444 Thereafter 983 Total minimum lease payments 4,896 Less: effect of discounting (863 ) Present value of future minimum lease payments 4,033 Less: current obligations under leases (1,021 ) Long-term lease obligations $ 3,012 Finance Leases The Company has finance leases for certain manufacturing and office equipment. Information related to the Company’s finance leases are as follows: (Amounts in thousands) For the Finance lease ROU Asset – December 31, 2020 $ 68 Increase 187 Decrease (22 ) Amortization (17 ) Finance lease ROU Asset – September 30, 2021 $ 216 Finance lease liability – December 31, 2020 $ 55 Increase 188 Interest accretion 1 Payment (40 ) Operating lease liability – September 30, 2021 $ 204 Finance lease liability – short term $ 66 Finance lease liability – long term 138 Finance lease liability – total $ 204 The following table presents the weighted-average remaining lease term and weighted average discount rates related to the Company’s finance leases as of September 30, 2021 and December 31, 2020, respectively: September 30, December 31, Weighted average remaining lease term 3.18 years 1.10 years Weighted average discount rate 0.54 % 3.91 % The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the finance lease liabilities recorded on the Condensed Consolidated Balance Sheet as of September 30, 2021: (Amounts in thousands) Finance Remainder of 2021 $ 23 2022 72 2023 63 2024 49 2025 11 Thereafter 6 Total minimum lease payments 224 Less: effect of discounting (20 ) Present value of future minimum lease payments 204 Less: current obligations under leases (66 ) Long-term lease obligations $ 138 |
Business Acquisitions
Business Acquisitions | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | 11. BUSINESS ACQUISITIONS Skyline Partners Technology LLC On January 29, 2021, the Company completed the acquisition of Skyline Partners Technology LLC, a Colorado limited liability company that does business under the name Fastback Networks (“Fastback”), for cash consideration paid of $1.32 million and the issuance of $1.50 million aggregate principal amount of term notes and $11.15 million aggregate principal amount of convertible notes that are convertible into common stock at a conversion price of $5.22 per share, subject to adjustment. See Note 13 – Debt Agreements The Company has accounted for the purchase using the acquisition method of accounting for business combinations under ASC 805. Accordingly, the purchase price has been allocated to the underlying assets and liabilities in proportion to their respective fair values. The excess of the consideration transferred over the estimated fair values of the net assets acquired was recorded as goodwill. The following table summarizes the acquired assets and assumed liabilities and the preliminary acquisition accounting for the fair value of the assets and liabilities recognized in the Condensed Consolidated Balance Sheet at September 30, 2021: (Amounts in thousands) Fair Value Cash $ 9 Accounts receivable 245 Inventory 358 Prepaid expenses 1,914 Property & equipment 202 Intangible assets: Intellectual Property 3,502 Software 96 Goodwill 9,527 Total assets 15,853 Accounts payable 1,055 Accrued liabilities 174 Notes payable 210 Contract liabilities, current 213 Accrued warranty liability – long term 236 Total purchase consideration $ 13,965 This purchase price allocation is preliminary and is pending the finalization of the third-party valuation analysis and working capital, as the Company has not yet completed the detailed valuation analyses as of the filing date of this Form 10-Q. Sky Sapience Ltd. On February 25, 2021, the Company completed the acquisition of Sky Sapience Ltd., a company organized under the laws of the State of Israel (“SKS”). The total preliminary purchase price consideration amounted to $11.78 million, subject to working capital and other post-closing adjustments, representing (i) cash paid on the closing date of $2.71 million (ii) 2,555,209 shares of the Company’s common stock with a fair value of $9.07 million or $3.55 per share, of which an aggregate of 1,151,461 shares is being held in an escrow fund for purposes of satisfying any post-closing indemnification claims of the sellers under the Share Purchase Agreement. SKS’s products complement and enhance the Company’s tethered drone product portfolio for commercial communications, defense and national security markets. All resulting goodwill is expected to be tax deductible. The Company has accounted for the purchase using the acquisition method of accounting for business combinations under ASC 805. Accordingly, the purchase price has been allocated to the underlying assets and liabilities in proportion to their respective fair values. The excess of the consideration transferred over the estimated fair values of the net assets acquired was recorded as goodwill. The following table summarizes the acquired assets and assumed liabilities and the preliminary acquisition accounting for the fair value of the assets and liabilities recognized in the Condensed Consolidated Balance Sheet at September 30, 2021: (Amounts in thousands) Fair Value Cash $ 320 Accounts receivable 60 Inventory 1,229 Prepaid expenses 15 Other current assets 334 Property & equipment 148 Operating lease right-of-use assets 472 Intangible assets: Goodwill 13,115 Total assets 15,693 Accounts payable 710 Accrued liabilities 431 Contract liabilities, current 2,309 Operating lease liabilities, current 194 Operating lease liabilities - long term 267 Total purchase consideration $ 11,782 RVision, Inc. On April 1, 2021, the Company completed the acquisition of RVision, Inc., a Nevada corporation. The Company acquired 100% of the outstanding capital stock of RVision in exchange for 2,000,000 shares of its common stock with a fair value of $2.75 per share. The company has agreed to file a registration statement under the Securities Act of 1933, as amended, to register the resale of 1,000,000 of such shares of common stock within 30 days of the closing date and to include the remaining shares in any registration statement the Company files under the Securities Act for a primary offering within one year of the closing date, subject to certain exceptions. RVision’s products complement and enhance the Company’s communication offerings and provides additional access to governmental and private sector commercial industries. All resulting goodwill is expected to be tax deductible. The Company has accounted for the purchase using the acquisition method of accounting for business combinations under ASC 805. Accordingly, the purchase price has been allocated to the underlying assets and liabilities in proportion to their respective fair values. The excess of the consideration transferred over the estimated fair values of the net assets acquired was recorded as goodwill. The following table summarizes the acquired assets and assumed liabilities and the preliminary acquisition accounting for the fair value of the assets and liabilities recognized in the Condensed Consolidated Balance Sheet at September 30, 2021: (Amounts in thousands) Fair Value Cash $ 449 Accounts receivable 47 Prepaid expenses 53 Inventory 825 Property & equipment 16 Operating lease right-of-use asset 270 Intangible assets: Goodwill 5,629 Total assets 7,289 Accounts payable 54 Accrued liabilities 219 Operating lease liabilities, current 74 Contract liabilities, current 793 Notes payable 453 Operating lease liabilities – long term 196 Total purchase consideration $ 5,500 This purchase price allocation is preliminary and is pending the finalization of the third-party valuation analysis and working capital, as the Company has not yet completed the detailed valuation analyses as of the filing date of this Form 10-Q. Innovation Digital, LLC On June 3, 2021, the Company completed the acquisition of Innovation Digital, LLC, a California limited liability company, for cash consideration paid of $1.0 million, 3,165,322 shares of common stock with a fair value of $7.34 million or $2.32 per share, and a promissory note in the principal amount of $0.60 million that is convertible into common stock at a conversion price of $2.35. Pursuant to the terms of the acquisition, the Company has agreed to filed a registration statement under the Securities Act of 1933, as amended (the “Securities Act”), to register the resale of the 3,165,322 shares of common stock. See Note 13 – Debt Agreements The Company has accounted for the purchase using the acquisition method of accounting for business combinations under ASC 805. Accordingly, the purchase price has been allocated to the underlying assets and liabilities in proportion to their respective fair values. The excess of the consideration transferred over the estimated fair values of the net assets acquired was recorded as goodwill. The following table summarizes the acquired assets and assumed liabilities and the preliminary acquisition accounting for the fair value of the assets and liabilities recognized in the Condensed Consolidated Balance Sheet at September 30, 2021: (Amounts in thousands) Fair Value Property & equipment 6 Operating lease right-of-use asset 105 Other Non-Current Assets 2 Intangible assets: Goodwill 9,046 Total assets 9,159 Accounts payable 78 Operating lease liabilities, current 32 Notes payable 31 Operating lease liabilities – long term 74 Total purchase consideration $ 8,944 This purchase price allocation is preliminary and is pending the finalization of the third-party valuation analysis and working capital, as the Company has not yet completed the detailed valuation analyses as of the filing date of this Form 10-Q. RF Engineering & Energy Resource, LLC On July 16, 2021, the Company completed the acquisition of RF Engineering& Energy Resource, LLC, a Michigan limited liability company, for cash consideration paid of $0.55 million and 992,780 shares of common stock with a fair value of $2.2 million or approximately $2.22 per share. RF Engineering’s position as a world-leading specialist in high performance antenna design and distribution enhances the Company’s wireless product development capabilities and sales and distribution channels. All resulting goodwill is expected to be tax deductible. See Note 13 – Debt Agreements The Company has accounted for the purchase using the acquisition method of accounting for business combinations under ASC 805. Accordingly, the purchase price has been allocated to the underlying assets and liabilities in proportion to their respective fair values. The excess of the consideration transferred over the estimated fair values of the net assets acquired was recorded as goodwill. The following table summarizes the acquired assets and assumed liabilities and the preliminary acquisition accounting for the fair value of the assets and liabilities recognized in the Condensed Consolidated Balance Sheet at September 30, 2021: (Amounts in thousands) Fair Value Cash $ 4 Accounts receivable 472 Prepaid expenses 42 Inventory 1,587 Other Current Assets 36 Property & equipment, net 72 Intangible assets: Goodwill 1,389 Total assets 3,602 Accounts payable 375 Accrued liabilities 4 Contract liabilities, current 20 Notes payable 453 Total purchase consideration $ 2,750 This purchase price allocation is preliminary and is pending the finalization of the third-party valuation analysis and working capital, as the Company has not yet completed the detailed valuation analyses as of the filing date of this Form 10-Q. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | 12. GOODWILL The following table sets forth the changes in the carrying amount of goodwill for the nine months ended September 30, 2021: (Amounts in thousands) Total Balance at December 31, 2020 $ 64,898 2021 Acquisitions 38,706 Balance at September 30, 2021 $ 103,604 The following table sets forth the gross carrying amounts and accumulated amortization of the Company’s intangible assets as of September 30, 2021 and December 31, 2020: (Amounts in thousands) Gross Accumulated Net Definite-lived intangible assets: Trade names $ 5,974 $ (1,350 ) $ 4,624 Licenses 350 (34 ) 316 Technology 39,350 (10,304 ) 29,046 Customer relationships 21,201 (5,485 ) 15,716 Intellectual property 3,730 (673 ) 3,057 Noncompete 937 (508 ) 429 Total definite-lived intangible assets at December 31, 2020 $ 71,542 $ (18,354 ) $ 53,188 Trade names $ 5,974 $ (2,037 ) $ 3,936 Licenses 69 (69 ) — Technology 39,350 (15,222 ) 24,128 Customer relationships 21,201 (8,365 ) 12,836 Intellectual property 7,232 (1,457 ) 5,775 Noncompete 937 (859 ) 78 Capitalized software 1,329 (48 ) 1,282 Total definite-lived intangible assets at September 30, 2021 $ 76,092 $ (28,057 ) $ 48,035 Amortization expense of intangible assets was $3.22 million and $2.62 million for the three months ended September 30, 2021 and 2020, respectively, and $9.67 million and $7.85 million for the nine months ended September 30, 2021 and 2020, respectively. During the nine months ended September 30, 2021, the Company impaired obsolete software that was replaced during the year. Impairment expense for the three and nine months ended September 30, 2021 was $0.28 million. There was no impairment expense for the three and nine months ended September 30, 2020. The Company’s amortization is generally based on no residual value using the straight-line amortization method as it best represents the benefit of the intangible assets. However, capitalized software is amortized using greater of the (1) the net realizable value test, which is based on the proportion of current gross revenues to the total of current and estimated future gross revenues for the project or (2) straight-line amortization. The following table sets forth the weighted-average amortization period, in total and by major intangible asset class: Asset Class Weighted- Trade names 6.8 years Licenses 5.0 years Technology 6.0 years Customer relationships 5.7 years Intellectual property 6.5 years Noncompete 2.0 years Capitalized software 4.7 years All Intangible assets 6.0 years As of September, 30 2021, assuming no additional amortizable intangible assets, the expected amortization expense for the unamortized acquired intangible assets for the next five years and thereafter was as follows: (Amounts in thousands) Estimated Remainder of 2021 $ 4,234 2022 12,689 2023 12,576 2024 10,494 2025 4,688 2026 2,057 Thereafter 1,297 Total $ 48,035 |
Debt Agreements
Debt Agreements | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
DEBT AGREEMENTS | 13. DEBT AGREEMENTS Secured Notes Payable In August 2016, InduraPower entered into a promissory note not to exceed the principal amount of $0.55 million that bore interest at 8.5% per annum with a maturity date of August 31, 2018. On September 11, 2019, the note was amended with both parties agreeing that the outstanding balance of $0.81 million would be due on February 28, 2020. This promissory note was secured by substantially all of the assets of InduraPower. As of December 31, 2020, an aggregate principal amount of $0.79 million was outstanding under this note. The aggregate principal amount of this note was fully repaid during fiscal 2021. In August 2016, InduraPower entered into a promissory note in the principal amount of $0.45 million that bore interest at 9.0% per annum and was scheduled to mature on March 1, 2022. As of December 31, 2020, an aggregate principal amount of and $0.15 million, was outstanding under this note. This promissory note was secured by all assets, certain real estate and cash accounts of InduraPower, and was guaranteed by certain officers of InduraPower. The aggregate principal amount of this note was fully repaid during fiscal 2021. In August 2016, InduraPower entered into a promissory note in the principal amount of $50 thousand that bore interest at 7.9% per annum and was scheduled to mature on September 1, 2021. This promissory note was secured by business equipment, certain real estate and cash accounts of InduraPower and was guaranteed by certain officers of InduraPower. As of December 31, 2020, an aggregate principal amount of $11 thousand was outstanding under this note. The aggregate principal amount of this note was fully repaid during fiscal 2021. In November 2019, DragonWave entered into a loan agreement under which it received $2.0 million bearing interest at the rate of 9.0% per annum and is scheduled to mature on November 26, 2021. Upon an event of default, the interest rate would automatically increase to 15% per annum on any unpaid principal and interest, compounded monthly, and all unpaid principal and accrued interest would become due on-demand. Accrued interest is calculated on a compound basis and is payable semi-annually in May and November of each year. Principal is scheduled to be due in full at maturity but can be prepaid in full or in part without penalty. The loan is secured by all of the assets of DragonWave and is guaranteed by ComSovereign. The debt issuance costs were the result of the issuance of 350,000 shares of common stock and a cash payment of $80 thousand. The Company defaulted on this loan during fiscal 2020, which caused the interest rate to increase to a monthly compounded rate of 15% per annum, a late charge of 5% was incurred, and the loan and accrued interest became due on-demand. Amounts recorded as debt discounts and issuance costs were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year, as a result of the loan becoming due on-demand from the default event. As of December 31, 2020, an aggregate principal amount of $2.0 million was outstanding under this loan. On January 26, 2021, $1.0 million of the principal amount of this loan and all accrued interest with a combined total of $1.23 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, On February 26, 2020, the Company entered into a $0.6 million secured business loan that bore interest at 78.99% per annum which matured on December 26, 2020. The loan was secured by the assets of the Company. As of December 31, 2020, an aggregate principal amount of $75 thousand was outstanding and past due under this loan. The aggregate principal amount of this loan was fully repaid during 2021. In connection with the acquisition of the business by Sovereign Plastics on March 6, 2020, the Company assumed a secured loan with FirstBank in the principal amount of $0.98 million that bore interest at 5% per annum, with a maturity date of June 1, 2020. This loan was subsequently extended to September 15, 2020 and the interest rate was increased to 36% per annum for any principal balance remaining unpaid past the extended maturity date. The loan was secured by certain assets of Sovereign Plastics. This loan was subjected to covenants, whereby Sovereign Plastics was required to meet certain financial and non-financial covenants at the end of each fiscal year. As of December 31, 2020, an aggregate principal amount of $0.86 million was outstanding and past due under this loan. The aggregate principal amount of this loan was fully repaid during fiscal 2021. On March 19, 2020, the Company entered into a secured loan agreement in the amount of $2.01 million that bore interest at 5% per annum with a maturity date of August 31, 2020, which was subsequently extended to October 15, 2020. Upon maturity, the interest rate automatically increased to 18% per annum, and a late charge of 5% was charged for any balance overdue by more than 10 days. The loan was secured by certain intellectual property assets of the Company. As of December 31, 2020, an aggregate principal amount of $2.01 million was outstanding and past due under this loan. On January 26, 2021, the aggregate principal amount of this loan and accrued interest with a combined total of $2.25 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, In connection with the acquisition of the business by Sovereign Plastics on March 6, 2020, the Company assumed various equipment financing loans with aggregate principal balances of approximately $0.2 million, which were secured by the related equipment, that bore interest ranging from 6.7% to 8.5% per annum. Monthly principal and interest payments were due over the term. As of December 31, 2020, aggregate principal balances of approximately $0.18 million were outstanding and past due under these loans. The aggregate principal amounts of these loans were fully repaid during fiscal 2021. On December 8, 2020, the Company entered into a secured loan agreement in the aggregate principal amount of $1.1 million with an original issue discount of $0.1 million, that bore interest at the rate of 10% per annum and matured on January 6, 2021. Upon an event of default, the interest rate would automatically increase to 36% per annum on any unpaid principal, or the maximum amount permitted by applicable law, compounded monthly, and all unpaid principal and accrued interest would become due on-demand. The loan was guaranteed by VNC and was secured by the Company’s equity interest in VNC, all of the assets of VNC and certain intellectual property assets of the Company. Daniel L. Hodges, the Company’s Chief Executive Officer, transferred a total of 23,334 shares of his personally owned, issued and outstanding common stock to the lender and brokers, as part of this transaction. The shares had a total fair value of $0.14 million. The Company accounted for this as a contribution from Mr. Hodges, as debt issuance costs. The Company incurred debt issuance costs to the placement agent of this transaction in the amount of $50 thousand. As of December 31, 2020, an aggregate principal amount of $1.1 million was outstanding under this loan. On January 26, 2021, $0.4 million of the principal amount of this loan and accrued interest with a combined total of $0.5 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, On January 15, 2021, in connection with its acquisition of the new manufacturing facility in Tucson, Arizona, AZCOMS entered into a secured loan agreement pursuant to which it received a loan in the amount of up to $5.36 million that bears interest on the outstanding loan balance at the greater of (i) 8% per annum or (ii) 6.75% per annum in excess of the 1-month LIBOR rate, and matures on January 15, 2022. At the closing of the loan, the lender withheld $0.51 million of the loan amount as an interest reserve. In addition, $0.88 million of the loan amount was withheld and may be disbursed at later dates to pay for lender-approved improvements to the property secured by the loan. Interest is payable monthly. The loan is due in full at maturity. Upon an event of default, the interest rate on the loan will increase by an additional 5.00% per annum, and the outstanding principal amount of the loan, accrued interest thereon and fees may become due on-demand. Upon the maturity date or earlier date upon which the unpaid balance of the loan may become immediately payable due to acceleration, and on any prepayments of the loan, AZCOMS will owe an exit fee equal to the greater of (a) $54 thousand, or (b) 1.00% of the unpaid loan balance and all unpaid accrued interest and fees. Subject to certain terms and conditions and upon payment of a fee, AZCOMS may request a six-month extension of the maturity date. The loan is secured by the land, building and certain other assets of AZCOMS and is guaranteed by the Company and Daniel L. Hodges, the Company’s Chief Executive Officer. In addition, all rights to leases and rent related to the land and building assets have been assigned to the lender for potential non-performance by AZCOMS of its obligations under the loan. This loan is subject to certain financial and non-financial covenants on the part of AZCOMS at the end of each fiscal quarter and fiscal year. The Company incurred debt issuance costs for transaction in the amount of $0.16 million. As of September 30, 2021, an aggregate principal amount of $5.00 million was outstanding under this loan. In connection with its acquisition of Fastback on January 29, 2021, the Company assumed the obligations of the sellers on a secured loan in the principal amount of $0.21 million that bears interest on the outstanding loan balance at the greater of (i) 5.75% per annum in excess of the Prime Rate or (ii) $4 thousand per month, with a maturity date of April 30, 2021. Interest is payable monthly. Upon an event of default, the interest rate on the loan will increase by an additional 5.00% per annum, and the outstanding principal amount of the loan, accrued interest thereon and fees may become due on-demand. The loan was secured by the assets of Fastback. The principal amount of this loan was fully repaid during fiscal 2021. Notes Payable In connection with its acquisition of DragonWave and Lextrum in April 2019, ComSovereign assumed the obligations of the seller on a promissory note in the principal amount of $0.5 million that bore interest at 12.0% per annum with a maturity date of October 17, 2017, which was subsequently extended to September 30, 2020 and the interest rate was reduced to 10% per annum. Accrued interest and the full principal balance were due at maturity. Upon maturity, the interest rate increased to 15% per annum for any balance overdue by more than 5 days. During 2020, all unpaid accrued interest from October 1, 2019 through December 31, 2019 was converted into 4,832 shares of common stock. As of December 31, 2020, an aggregate principal amount of $0.5 million was outstanding and past due under this note. On January 26, 2021, the aggregate principal amount of this note and accrued interest with a combined total of $0.56 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, In connection with its acquisition of DragonWave and Lextrum in April 2019, ComSovereign assumed the obligations of the seller of a promissory note in the principal amount of $0.18 million that bore interest at the rate of 15% per annum and was due on November 30, 2017, which was subsequently extend to September 30, 2020 and the interest rate was reduced to 10% per annum. Accrued interest and principal were due and payable at maturity. Upon maturity, the interest rate increased to 15% per annum for any balance overdue by more than 5 days. As of December 31, 2020, an aggregate principal amount of $0.18 million was outstanding and past due. The aggregate principal amount of this note was fully repaid during fiscal 2021. In October 2017, DragonWave entered into a 90-day promissory note in the principal amount of $4.4 million with an original issue discount of $0.4 million. Subsequently, this note was amended to accrue interest at the rate of 8% per annum and to extend the maturity date with new payment terms. In September 2019, the promissory note was increased to $5.0 million as all unpaid accrued interest was added to the principal balance and to extend the maturity date to March 20, 2020 and increase the interest rate to 10% per annum. In April 2020, the maturity date of this note was extended to August 31, 2020, the interest rate was increased to 12% per annum, and the Company provided to the lender 33,334 fully paid and non-assessable shares of its common stock that have been treated as debt issuance costs. As of December 31, 2020, an aggregate principal amount of $3.5 million was outstanding under this note. On January 26, 2021, the aggregate principal amount of this note and accrued interest with a combined total of $4.21 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, On November 7, 2019, ComSovereign entered into several promissory notes in the aggregate principal amount of $0.45 million that bore an effective interest rate at 133% per annum due to a single payment incentive, which matured on December 6, 2019. Of these promissory notes, an aggregate principal amount of $0.2 million was owed to three employees. Accrued interest and principal were due and payable at maturity. These notes had been past due and were accruing interest at a rate of 18% per annum. As of December 31, 2020, the aggregate principal amount of $67 thousand was outstanding and past due under these notes. The aggregate principal amount of these notes was fully repaid during fiscal 2021. On March 5, 2020, the Company sold a promissory note in the principal amount of $0.5 million with an original issue discount of $54 thousand, that matured on November 30, 2020. Additionally, in lieu of interest, the Company issued to the lender 16,667 shares of its common stock with a fair value of $57 thousand, which was recognized as a debt discount and amortized to interest expense over the term of the note. Any principal balance remaining unpaid past the maturity date accrued interest at a rate of 15% per annum. As of December 31, 2020, an aggregate principal amount of $0.5 million was outstanding and past due under this note. On January 26, 2021, the aggregate principal amount of this note and accrued interest with a combined total of $0.51 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, In connection with the acquisition of the business by Sovereign Plastics on March 6, 2020, the Company, entered into promissory notes or agreed to pay the sellers an aggregate principal amount of $0.58 million that did not bear interest and required monthly principal payments. As of December 31, 2021, an aggregate amount of $0.55 million was outstanding and past due. However, there were no penalties associated with this default. The aggregate principal amount of these notes was fully repaid during fiscal 2021. In addition, the Company assumed a note payable in the amount of $87 thousand bearing interest at 3% per annum and with a maturity date of February 16, 2023. Monthly payments of principal and interest are due over the term. As of September 30, 2021 and December 31, 2020, an aggregate principal amount of $22 thousand and $83 thousand, respectively, was outstanding under this note. On May 29, 2020, the Company entered into a promissory note in the principal amount of $0.29 with an original issue discount of $40 thousand and a maturity date of September 30, 2020. The balance was due at maturity, with interest accruing at a rate of 12% per annum for any principal balance remaining unpaid past the maturity date. As of December 31, 2020, an aggregate principal amount of $0.29 million was outstanding and past due under this note. On January 26, 2021, the aggregate principal amount of this note, a 10% principal bonus, and accrued interest with a combined total of $0.33 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, Between July 2, 2020 and August 21, 2020, the Company borrowed an aggregate of $1.2 million from accredited investors and issued to such investors promissory notes evidencing such loans. The principal amounts of the notes were between $50 thousand and $200 thousand. The notes had maturity dates between October 13, 2020 and November 30, 2020 that bore interest at a rate of 15% per annum, with interest accrued at an annually compounded rate of 18% per annum for any principal balance remaining unpaid past the maturity date. Daniel L. Hodges, the Company’s Chief Executive Officer, transferred a total of 96,634 shares of his personally owned, issued and outstanding common stock, with a fair value of $0.48 million, to the accredited investors and brokers, as part of this transaction. The Company accounted for this as a contribution from Mr. Hodges and as debt discounts and issuance costs. The amounts recorded as debt discounts and issuance costs were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year. As of December 31, 2020, an aggregate principal amount of $1.2 million was outstanding and past due under these notes. On January 26, 2021, $0.75 million of the aggregate principal amount of these notes, a 10% principal bonus, and accrued interest with a combined total of $0.89 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, Between November 4, 2020 and November 24, 2020, the Company borrowed an aggregate of $0.55 million from accredited investors and issued to such investors promissory notes evidencing such loans. The principal amounts of the notes were between $50 thousand and $100 thousand. The notes had maturity dates between January 31, 2021 and February 23, 2021 that bore interest at a rate of 15% per annum, with interest accrued at an annually compounded rate of 18% per annum for any principal balance remaining unpaid past the maturity date. Daniel L. Hodges, the Company’s Chief Executive Officer, transferred a total of 38,334 shares of his personally owned, issued and outstanding common stock, with a fair value of $0.26 million, to the accredited investors, as part of this transaction. The Company accounted for this as a contribution from Mr. Hodges and as debt discounts and issuance costs. The Company defaulted on these notes during the 2020 fiscal year, causing the interest rate to increase to an annually compounded rate of 18% per annum, and the note and accrued interest to become due on-demand. The amounts recorded as debt discounts were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year. As of December 31, 2020, an aggregate principal amount of $0.55 million was outstanding under these notes. On January 26, 2021, $0.5 million of the aggregate principal amount of these notes, a 10% principal bonus, and accrued interest with a combined total of $0.57 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Shareholders’ Equity, In connection with its acquisition of Fastback on January 29, 2021, the Company issued to the sellers $1.5 million aggregate principal amount of term promissory notes. The individual principal amounts of the notes ranged from $1 thousand to $393 thousand. These notes bore interest at the rate of 10% per annum and matured on the earlier of (i) January 1, 2022, (ii) the date on which an aggregate of $6.0 million worth of products and services are sold following the acquisition date by (A) Fastback or (B) the Company and its subsidiaries (other than Fastback) to certain specified Fastback customers, or (iii) the date on which the Company issues and sells shares of its common stock or debt securities to investors in a bona-fide arms-length financing transaction for aggregate consideration of at least $12.0 million. Interest was payable in cash semi-annually in arrears on each June 1 and December 1, commencing on June 1, 2021, and on the maturity date. Principal and any unpaid accrued interest was due on the maturity date. These notes matured on February 10, 2021 upon the Company’s closing of a public offering, as disclosed in Note 15- Shareholders’ Equity Various subsidiaries of the Company received loan proceeds or the Company assumed in conjunction with various acquisitions an aggregate amount of $0.77 million under the Paycheck Protection Program (“PPP”). The PPP loans have maturity dates ranging from 2 to 5 years and an interest rate of 1% per annum. The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable pursuant to section 1106 of the CARES Act, after a period of up to 24 weeks, as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The amount of loan forgiveness shall be calculated in accordance with the requirements of the PPP, including the provisions of Section 1106 of the CARES Act, although no more than 40 percent of the amount forgiven can be attributable to non-payroll costs. Further, the amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the period of up to 24 weeks. During the nine months ended September 30, 2021, an aggregate of $0.73 million of these notes has been forgiven. This forgiveness was recorded as a gain on extinguishment of debt in the Condensed Consolidated Statement of Operations. As of September 30, 2021 and December 31, 2020 September 30, 2021 and, an aggregate principal amount of $0.04 million and $0.58 million, respectively, was outstanding under these loans. In connection with the acquisition of RVision by the Company, the Company assumed two notes payable with aggregate principal balances of $0.3 million. These notes bore interest at 6% and were paid in full immediately following the completion of the acquisition by the Company. Senior Debentures In connection with its acquisition of DragonWave and Lextrum in April 2019, ComSovereign assumed the obligations of the seller of $0.1 million aggregate principal amount of 8% Senior Convertible Debentures of the seller that bore interest at the rate of 8% per annum and matured on December 31, 2019. Interest was payable semi-annually in cash or, at the seller’s option, in shares of the seller’s common stock at the conversion price that was equal to the lesser of (1) $24.00 or (2) 80% of the common stock price offered under the next equity offering. On April 30, 2020, these debentures were modified to remove the conversion feature and only have settlement through cash. During fiscal 2020, these debentures became past due and interest accrued at a rate of 15% per annum. As of December 31, 2020, an aggregate principal amount of $84 thousand was outstanding under these debentures. The aggregate principal amount of this debenture was fully repaid during fiscal 2021. Convertible Notes Payable On July 7, 2020, the Company sold a convertible promissory note in the principal amount of $0.29 million with an original issue discount of $36 thousand that bore interest at a rate of 12.5% per annum, and warrants to purchase an additional 52,910 shares of common stock. Warrants to purchase up to 9,260 shares of common stock, were also issued to an unrelated third-party as a placement fee for the transaction. Terms and maturities are similar to the April 29, 2020 note, as disclosed in the Company’s annual 10-K. In connection with this note, the Company recognized debt discounts of $0.22 million. On July 28, 2020, the Company defaulted on this note under the related Registration Rights Agreement by not filing a registration statement by July 28, 2020. As a result, the aggregate principal balance increased by penalties and interest of $88 thousand. In addition, the interest rate was increased to 24% per annum, and the note and accrued interest became due on-demand. As of December 31, 2020, there was an aggregate principal amount of $0.37 million outstanding and past due under this note. On January 22, 2021, the note holder converted the full principal of $0.37 million and all accrued interest with a combined total of $0.42 million into 155,013 shares of common stock. On August 21, 2020, the Company sold a convertible promissory note in the principal amount of $1.7 million with an original issue discount of $0.2 million that bore interest at a rate of 5.0% per annum and matured on November 20, 2020. Accrued interest and principal were due on the maturity date. Upon maturity, the interest rate automatically increased to the lesser of 18% per annum or the maximum amount permitted by applicable law on any unpaid principal and accrued interest. Following the maturity date, the note was convertible into shares of common stock at a conversion price equal to 65% of the lowest volume weighted average price of the common stock during the 20 consecutive trading days immediately preceding the conversion date. As additional consideration for the loan, the Company issued to the lender 133,334 shares of common stock at a fair value of $10.05 per share. Warrants to purchase up to 17,857 shares of common stock that are exercisable for a purchase price of $8.40 per share at any time on or prior to August 20, 2025, were also issued to an unrelated third-party as a placement fee for the transaction. These transactions resulted in the Company recognized aggregate debt discounts of $1.73 million. On November 21, 2020, the Company defaulted on this note by not repaying the principal and accrued interest by the maturity date, which resulted in the aggregate principal balance increasing by penalties and interest of $0.54 million. In addition, the interest rate was increased to 24% per annum. As of December 31, 2020, an aggregate principal amount of $2.24 million was outstanding and past due under this note. The aggregate principal amount of this note was fully repaid during fiscal 2021. In connection with its acquisition of Fastback on January 29, 2021, the Company issued to the sellers $11.15 million aggregate principal amount of convertible promissory notes. The individual principal amounts of the notes ranged from $6 thousand to $5.58 million. These notes initially bear interest at the rate of 1.01% per annum, which is to be adjusted to the prime rate as published by the Wall Street Journal on each annual anniversary of the issuance date, and mature on January 29, 2026. Interest is payable in cash annually in arrears on each January 1. Commencing on January 29, 2022, the outstanding principal and accrued interest on these notes may be converted in full to shares of the Company’s common stock at a conversion price of $5.22 per share, subject to adjustment. Upon an event of default, the interest rate will automatically increase to 15% per annum compounded annually, and all unpaid principal and accrued interest may become due on-demand. Principal and any unpaid accrued interest are due on the maturity date. Upon maturity, the interest rate will automatically increase to 15% per annum compounded annually on any unpaid principal. As of September 30, 2021, an aggregate principal amount of $11.15 million was outstanding. In connection with its acquisition of Innovation Digital on June 3, 2021, the Company issued to the seller, who became an employee of the Company, a convertible promissory note in the principal amount of $0.6 million that bears interest at the rate of 5% per annum, maturing on June 3, 2022. Accrued interest and principal is due at maturity. Commencing December 3, 2021, the outstanding principal and accrued interest on this note may be converted into shares of the Company’s common stock at an initial conversion price of $2.35 per share subject to certain terms, conditions and adjustment. As of September 30, 2021, the full principal amount of $0.6 million was outstanding. Senior Convertible Promissory Note On May 27, 2021, the Company sold a senior secured convertible promissory note in the principal amount of $11.0 million with an original issue discount of $1.0 million bearing an interest rate of 6% per annum that matures on May 27, 2023. The Company issued to the buyer warrants to purchase up to 1,820,000 shares of common stock with an exercise price of $4.50 per share, subject to adjustment, any time prior to May 27, 2026, and a grant date fair value of $0.505 per share. The Company also paid aggregate cash debt issuance costs of $0.69 million. The resulting aggregate debt discount recorded by the Company of $2.6 million. Principal payments of $0.61 million plus interest are required to be paid monthly commencing six months after the date of issuance. This note is guaranteed by each of the Company’s subsidiaries and is secured by a first priority lien on all of the assets and properties of the Company and the assets and properties of its subsidiaries, subject only to the liens securing approximately $1.0 million principal amount of outstanding indebtedness of one of its subsidiaries. On August 25, 2021, we amended and restated the senior secured convertible note we issued to reduce the initial conversion price of such note to $3.00 per share, and to adjust the exercise price of the warrants to $3.00 per share. As of September 30, 2021, he full principal amount of $11.0 million was outstanding. On August 25, 2021, the Company sold a senior secured convertible promissory note in the principal amount of $5.8 million with an original issue discount of $0.8 million bearing an interest rate of 6% per annum that matures on August 25, 2025. The Company issued to the buyer warrants to purchase up to 1,315,789 shares of common stock with an exercise price of $3.00 per share, subject to adjustment, any time prior to August 25, 2026, and a grant date fair value of $0.859 per share. The Company also paid aggregate cash debt issuance costs of $0.35 million. The resulting aggregate debt discount recorded by the Company of $2.28 million. Principal payments of $0.322 million plus interest are required to be paid monthly commencing five business days after a registration statement is declared effective, but in no event later than November 30, 2021. This note is guaranteed by each of the Company’s subsidiaries and is secured by a first priority lien on all of the assets and properties of the Company and the assets and properties of its subsidiaries, subject only to the liens securing approximately $1.0 million principal amount of outstanding indebtedness of one of its subsidiaries. As of September 30, 2021, an aggregate principal amount of $5.8 million was outstanding. Senior Convertible Debentures On September 24, 2019, ComSovereign sold $0.25 million aggregate principal amount of 10% Senior Convertible Debentures that bore interest at a rate of 10% per annum and were scheduled to mature on December 31, 2021. Interest was paid semi-annually in arrears in June and December of each year in cash or, at ComSovereign’s option, in shares of common stock at the conversion price that is equal to the lesser of (1) $7.50 or (2) a future effective price per share of any common stock sold by ComSovereign. Upon an event of default, the interest rate shall automatically increase to 15% per annum. In connection with these debentures, ComSovereign recognized aggregate debt discounts of $0.25 million. On April 21, 2020, all unpaid accrued interest through December 31, 2019 was converted into 2,234 shares of common stock. Also on April 21, 2020, all the outstanding warrants were exercised at $0.03 per share into 94,510 issued shares of the Company’s common stock, resulting in full rec |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 14. RELATED PARTY TRANSACTIONS Accrued Liabilities – Related Party As of September 30, 2021 and December 31, 2020, the accrued liabilities – related party balance was $86 thousand and $30 thousand, respectively, which represented amounts owed to various contractors, officers and employees of the Company as described below. On November 10, 2017, the Company and Global Security Innovative Strategies, LLC (“GSIS”), a company in which David Aguilar, a member of the Company’s Board of Directors, is a principal, entered in an agreement (the “GSIS Agreement”) pursuant to which GSIS agreed to provide business development support and general consulting services for sales opportunities with U.S. government agencies and other identified prospects and consulting support services for the Company. The GSIS Agreement had an initial term of six months beginning on November 1, 2017. On September 26, 2018, the parties amended the GSIS Agreement to extend the period of service through September 2019 with monthly automatic renewals thereafter. The Company also agreed to issue an option to purchase 100,000 shares of the Company’s common stock at an exercise price of $1.00. This option immediately vested and terminates on September 26, 2022. Pursuant to the GSIS Agreement, GSIS is paid a fee of $10 thousand per month. In addition, GSIS is paid for the expenses incurred in connection with the performance of its duties under the GSIS Agreement. Either party may terminate or renew the GSIS Agreement at any time, for any reason or no reason, upon at least 30 days’ notice to the other party. As of September 30, 2021 and December 31, 2020, GSIS was owed $31 thousand and $30 thousand, respectively, for normal monthly retainers and expenses incurred and these amounts were recorded in accrued liabilities – related party. Notes Payable – Related Party On August 5, 2019, Daniel L. Hodges, the Company’s Chairman and Chief Executive Officer, and his wife, loaned DragonWave $0.2 million at an interest rate of 5.0% per annum and an 18.0% default interest rate with a maturity date of December 31, 2020. Interest was payable monthly while the full principal balance was due at maturity. During fiscal 2020, this loan became past due and was accruing interest at an increased default rate of 18.0% per annum. As of December 31, 2020, $0.2 million was outstanding and past due under the loan. The aggregate principal amount of this note was fully repaid during the first quarter of fiscal year 2021. On July 1, 2020, Brent Davies, a member of the Company’s Board of Directors and Audit Committee, loaned the Company $50 thousand at an interest rate of 4.80% per annum with an original maturity date of August 31, 2020. This note was amended to extend the maturity date to November 30, 2020. Interest and the full principal balance was due at maturity. During fiscal 2020, this loan became past due and was accruing interest at an increased default rate of 18.0% per annum. As of December 31, 2020, $50 thousand was outstanding and past due under the loan. The aggregate principal amount of this note was fully repaid during the first quarter of fiscal year 2021. Between October 15, 2020 and December 28, 2020, the Company borrowed an aggregate of $0.6 million from Dr. Dustin McIntire, the Company’s Chief Technology Officer, and issued promissory notes evidencing such loans. The principal amounts of the notes were between $0.1 million and $0.4 million, and such notes bore interest at 10% per annum and were due between January 14, 2021 and March 28, 2021. As of December 31, 2020, $0.6 million was outstanding under these notes. The aggregate principal amount of these notes was fully repaid during the first quarter of fiscal year 2021. Between November 13, 2020 and December 24, 2020, the Company borrowed an aggregate of $0.16 million from Richard J. Berman, a member of the Company’s Board of Directors, and issued promissory notes evidencing such loans. The principal amounts of the notes were between $40 thousand and $120 thousand, and such notes bore interest at 8% per annum and were due between February 12, 2021 and March 23, 2021. As of December 31, 2020, $0.16 million was outstanding under these notes. On January 26, 2021, the aggregate principal amount of this note, a 10% principal bonus, and all accrued interest with a combined total of $0.18 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, |
Shareholders_ Equity
Shareholders’ Equity | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS’ EQUITY | 15. SHAREHOLDERS’ EQUITY For the nine months ended September 30, 2021 As of September 30, 2021, the Company had 100,000,000 shares of preferred stock authorized for issuance, none of which were issued and outstanding and 300,000,000 shares of common stock authorized for issuance and 72,533,850 shares of common stock issued and outstanding. On May 26, 2020, the board of directors of the Company and stockholders holding a majority of the outstanding shares of the Company’s common stock approved resolutions authorizing the board of directors to effect the Split of the Company’s common stock at an exchange ratio of up to 1-for-3, with the board of directors retaining the discretion as to whether to implement the Split. On December 16, 2020, the Company’s board of directors approved a ratio for the Split of 1-for-3, which was effected on January 21, 2021. The Condensed Consolidated Financial Statements and accompanying notes give effect to this Split as if it occurred at the beginning of the first period presented. Public Offerings On January 26, 2021 (the “First Offering Closing Date”), the Company sold an aggregate of 3,855,422 units at a price to the public of $4.15 per unit (the “First Offering”), each unit consisting of one share of the Company’s common stock, and a warrant to purchase one share of common stock at an exercise price of $4.50 per share (the “First Offering Warrants”), pursuant to an Underwriting Agreement, dated as of January 21, 2021 (the “First Offering Underwriting Agreement”), between the Company and the representative (the “Representative”) of the several underwriters named in the First Offering Underwriting Agreement. In addition, pursuant to the First Offering Underwriting Agreement, the Company granted the Representative a 45-day option to purchase up to 578,312 additional shares of common stock, and/or 578,312 additional First Offering Warrants, to cover over-allotments in connection with the First Offering, which the Representative partially exercised to purchase 578,312 Warrants on the First Offering Closing Date. For additional information on these First Offering Warrants, see Note 16 – Share-Based Compensation. The common stock and the warrants of the First Offering were offered and sold to the public pursuant to the Company’s registration statement on Form S-1 (File No. 333-248490), filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) under the Securities Act, on August 28, 2020, as amended, and which became effective on January 21, 2021. On the First Offering Closing Date, the Company received gross proceeds of approximately $16.0 million, before deducting underwriting discounts and commissions of eight percent (8%) of the gross proceeds and estimated offering expenses. On January 27, 2021, the Representative exercised its over-allotment option for the First Offering to purchase 329,815 additional shares of common stock, which closed on January 29, 2021. The Company received gross proceeds of approximately $1.37 million before deducting underwriting discounts and commissions of eight percent (8%) of the gross proceeds. Pursuant to the First Offering Underwriting Agreement, the Company also agreed to issue to the Representative warrants (the “Representative’s First Offering Warrants”) to purchase up to a total of 154,216 shares of common stock (4% of the shares of common stock sold in the First Offering). See Note 16 – Share-Based Compensation. The total expenses of the First Offering were approximately $2.7 million, which included the underwriting discounts and commissions and the Representative’s reimbursable expenses relating to the First Offering. As part of this offering, the Company also issued 100,000 warrants to purchase the Company’s common stock at $4.15 per share to compensate a vendor for certain offering costs. See Note 16 – Share-Based Compensation. On February 10, 2021 (the “Second Offering Closing Date”), the Company sold an aggregate of 5,647,059 shares of the Company’s common stock, at a price to the public of $4.25 per share (the “Second Offering”), pursuant to an Underwriting Agreement, dated as of February 10, 2021 (the “Second Offering Underwriting Agreement”), between the Company the Representative of the several underwriters named in the Second Offering Underwriting Agreement. In addition, pursuant to the Second Offering Underwriting Agreement, the Company granted the Representative a 45-day option to purchase up to 847,058 additional shares of common stock to cover over-allotments in connection with the Second Offering, which the Representative exercised in full on February 11, 2021. The common stock was offered and sold to the public pursuant to the Company’s registration statement on Form S-1 (File No. 333-252780), filed by the Company with the SEC under the Securities Act, on February 5, 2021, and the Company’s registration statement on Form S-1 (File No. 333-252974), filed by the Company with the SEC under Rule 462(b) of the Securities Act on February 10, 2021, each of which became effective on February 10, 2021. The Company received gross proceeds of approximately $27.6 million, before deducting underwriting discounts and commissions of 8% of the gross proceeds and estimated offering expenses. Pursuant to the Second Offering Underwriting Agreement, the Company also issued to the Representative warrants (the “Representative’s Second Offering Warrants”) to purchase up to a total of 225,882 shares of common stock (4% of the shares of common stock sold in the Second Offering), of which warrants to purchase 198,776 shares of common stock were registered under the Securities Act and warrants to purchase 27,106 shares of common stock were issued in a private placement to the Representative. See Note 16 – Share-Based Compensation. The total expenses of the Second Offering were approximately $2.6 million, which included the underwriting discounts and commissions and the Representative’s reimbursable expenses relating to the Second Offering. Consulting Agreements and Settlements with Vendors On January 31, 2020, the Company entered into an agreement with a consultant to replace an existing consulting agreement between the consultant and the Company to allow the consultant to elect to take from 50% to 100% of its compensation in the form of common stock based on an agreed upon conversion calculation. Any difference between the amount due and the actual fair value of the shares issued in payment is recorded as general and administrative expense in the Company’s Condensed Consolidated Financial Statements. Common stock to be issued to the consultant will be paid on a quarterly basis. During the nine months ended September 30, 2021 and 2020, respectively, the Company issued 15,740 shares of its common stock with a fair value of $69 thousand and 55,032 shares of its common stock, with a fair value of $193 thousand to the consultant for services previously rendered. On December 9, 2020, the Company entered into an agreement with a consultant that required the payment of 5,000 shares of its common stock with a fair value of $31 thousand at the inception of the contract with the obligation to perform services in the future. These shares of common stock were issued on December 14, 2020. As of December 31, 2020, 2,125 of these shares of common stock had vested and expense of $13 thousand has been recognized, through satisfaction of the performance obligation. During the first quarter of the fiscal 2021 year, the remaining shares of 2,875 vested and $18 thousand of additional expense was recognized. Dividends The Company did not pay dividends to holders of its common stock during the nine months ended September 30, 2021. The determination to pay dividends on common stock will be at the discretion of the Board of Directors and will depend on applicable laws and the Company’s financial condition, results of operations, cash requirements, prospects and such other factors as the Board of Directors may deem relevant. In addition, current or future loan agreements may restrict the Company’s ability to pay dividends. The Company does not anticipate declaring or paying any cash dividends on common stock in the foreseeable future. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | 16. SHARE-BASED COMPENSATION As described in Note 15 – Stockholders’ Equity 2020 Long-Term Incentive Plan On April 22, 2020, the Company’s Board of Directors adopted the 2020 Long-Term Incentive Plan (the “2020 Plan”), which was approved by the stockholders on or about May 6, 2020. Employees, officers, directors and consultants that provide services to the Company or one of its subsidiaries may be selected to receive awards under the 2020 Plan. Awards under the 2020 Plan may be in the form of incentive or nonqualified stock options, stock appreciation rights, stock bonuses, restricted stock, stock units and other forms of awards including cash awards and performance-based awards. As originally approved, a total of 3,333,334 shares of the Company’s common stock were authorized for issuance with respect to awards granted under the 2020 Plan. As approved by the stockholders on or about June 25, 2021, the amount authorized to be issued under the 2020 Plan has been increased to 8,333,334 shares of the Company’s common stock. Any shares subject to awards that are not paid, delivered or exercised before they expire or are cancelled or terminated, or fail to vest, as well as shares used to pay the purchase or exercise price of awards or related tax withholding obligations, will become available for other award grants under the 2020 Plan. As of September 30, 2021, 5,430,505 options had been issued under the 2020 Plan, of which 33,334 were forfeited and 63,333 have been exercised, and 2,936,163 shares authorized under the 2020 Plan remained available for award purposes. The 2020 Plan will terminate on May 1, 2030. The maximum term of options, stock appreciation rights and other rights to acquire common stock under the 2020 Plan is ten years after the initial date of the award. Restricted Stock Awards On December 2, 2019, the Company’s Board of Directors granted an aggregate of 633,336 RSAs to nine officers and directors (“Participant”) at a grant date fair value of $2.46 per share. The original vesting period for these RSAs is as follows: 283,339 were to vest on the one-year anniversary of the grant date; 283,331 were to vest on the two-year anniversary of the original grant date; and 66,666 were scheduled to vest on the three-year anniversary of the original grant date. As of December 31, 2020, 283,339 RSAs had vested. In the first quarter of fiscal 2021, the Company modified the RSA awards for two individuals to accelerate the final vesting of their awards in consideration of the individuals’ separation and/or retirement. This modification resulted in the vesting of an additional 50,000 RSAs. An incremental compensation expense was recognized for the modification totaling $0.17 million during the nine months ended September 30, 2021. As of September 30, 2021, the remaining unvested RSAs from these awards, totaling 299,997, are scheduled to vest as follows: 233,331 are scheduled to vest on the two-year anniversary of the original grant date; and 66,666 were scheduled to vest on the three-year anniversary of the original grant date. On January 26, 2021, the Company’s Board of Directors granted an aggregate of 66,667 RSAs to one director at a grant date fair value of $4.50 per share. The vesting period for these RSAs is as follows: 33,334 vest on the one-year anniversary of the grant date and 33,333 vest on the two-year anniversary of the original grant date. For all RSAs that are currently outstanding, if the Participant’s employment with, engagement by, or service to the Company terminates for any reason (other than due to disability, retirement or death, or termination by employee for “Good Cause” as defined pursuant to a written employment contract) prior to the vesting of all or any portion of the RSAs granted, such RSAs shall immediately be cancelled. If the Participant’s employment with, engagement by, or service to the Company terminates due to the Participant’s death, disability or retirement, or by termination by such employee for “Good Cause” as defined pursuant to a written employment contract, the Participant shall become 100% vested in the RSAs granted as of the date of any such termination. There were no RSAs that were forfeited in the nine months ended September 30, 2021. For the three and nine months ended September 30, 2021, respectively, the Company recognized $0.18 million and $0.71 million of compensation expense related to RSAs and had unrecognized compensation cost as of September 30, 2021 for RSAs of $0.46 million. Stock Options On April 1, 2021, from shares available to be issued under the 2020 Plan, the Board of Directors of the Company granted options to purchase an aggregate 2,458,163 shares of common stock with exercise prices ranging from $2.75 to $3.025 per share and a grant date fair value ranging from $0.961 to $1.042 per share. These options have a three year service period and vest ratably on the first, second and third anniversary of their grant date. Also, on April 1, 2021, the Board of Directors of the Company authorized the issuance of options to purchase an aggregate of 2,680,048 shares of common stock with an exercise price of $2.75 per share. These shares were in excess of the number of shares available under the 2020 Plan at that time and were subject to the approval by the Company’s stockholders of an increase to the shares available in the 2020 Plan as noted above. Effective with the approval of the shareholders on June 25, 2021, these shares were considered granted and have a grant date fair value ranging from $0.759 to 0.768 per share. Of these, options to purchase 753,837 shares have a three year service period and vest ratably on the first, second and third anniversary of their authorization for issuance and options to purchase 1,025,000 shares have a two-year service period and vest ratably on the first and second anniversary of their authorization for issuance. On May 5, 2021, the Board of Directors of the Company authorized the issuance of options to purchase an aggregate of 295,000 shares of common stock with an exercise price of $2.75 per share. These shares were in excess of the amount of shares available under the 2020 Plan at that time and were subject to the approval by the Company’s stockholders of an increase to the shares available in the 2020 Plan as noted above. Effective with the approval of the shareholders on June 25, 2021, these shares are considered granted and have a grant date fair value of $0.873 per share. Of these, options to purchase 2,700,000 shares have a one year service period and vest ratably on the six month and twelve month anniversary of their authorization for issuance and options to purchase 25,000 shares vested immediately upon grant. On June 29, 2021, the Board of Directors approved the modification of 655,002 options previously issued outside of the corporate plan. These options were scheduled to expire 90 days after the March 31, 2021 retirement of a long-time employee. This modification extended the expiration date of these options through December 15, 2021. The Company has recognized incremental compensation expense of $0.13 million related to this modification. No options were granted during the three months ended September 30, 2020. The following table summarizes the assumptions used to estimate the fair value of options granted during the nine months ended September 30, 2021: 2021 Expected dividend yield 0 % Expected volatility 46.5 - 53.02 % Risk-free interest rate 0.48 - 0.89 % Expected life of options 3.00 - 5.00 years The following tables represent stock option activity for the nine months ended September 30, 2021 and 2020: (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2020 3,433,515 $ 1.59 2.01 $ 15,221 Exercisable – December 31, 2020 3,400,181 1.58 1.99 15,129 Granted 4,532,000 2.76 4.51 — Exercised (63,333 ) 0.26 3.77 85 Cancelled or Expired (856,669 ) 1.78 0.18 91 Outstanding – September 30, 2021 7,045,513 $ 2.33 3.51 $ 830 Exercisable – September 30, 2021 2,513,513 $ 1.56 1.70 $ 830 (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2019 2,898,347 $ 1.90 1.92 $ 2,265 Exercisable – December 31, 2019 2,898,347 1.90 1.92 2,265 Granted 908,505 0.77 4.59 5,838 Exercised — — — — Cancelled or Expired (333,335 ) 2.01 0.59 1,903 Outstanding – September 30, 2020 3,440,183 $ 1.59 2.26 $ 19,339 Exercisable – September 30, 2020 3,406,849 $ 1.58 2.24 $ 19,207 The Company recognized $0.47 million and $0.82 million of share-based compensation expense related to options for the three and nine months ended September 30, 2021, respectively. The Company recognized $5 thousand of share-based compensation expense related to options for the nine months ended September 30, 2020. Compensation expense related to stock options is recorded in general and administrative in the Condensed Consolidated Statement of Operations. For the nine months ended September 30, 2021, the Company has $3.48 million of unrecognized compensation expense related to options. For the nine months ended September 30, 2020, the Company had $25 thousand of unrecognized compensation expense related to options. Warrants On January 26, 2021, the Company issued warrants to purchase an aggregate of 2,751,556 shares of the Company’s common stock as partial consideration for the debt extinguishments disclosed in Note 15 – Debt Agreements Related Party Transactions On January 26, 2021, the Company issued warrants to purchase an aggregate of 100,000 shares of the Company’s common stock as consideration for certain costs related to the First Offering as disclosed in Note 15 – Stockholders’ Equity On January 26, 2021, the Company issued warrants to purchase an aggregate of 154,216 shares of the Company’s common stock as the Representative’s First Offering Warrants as discussed in Note 15 – Stockholders’ Equity On January 26, 2021, the Company issued warrants to purchase an aggregate of 4,433,734 shares of the Company’s common stock as portion of the Units offered in the Company’s First Offering as disclosed in Note 15 – Stockholders’ Equity On February 12, 2021, the Company issued warrants to purchase an aggregate of 225,882 shares of the Company’s common stock as the Representative’s Second Offering Warrants as discussed in Note 15 – Stockholders’ Equity On May 27, 2021, the Company issued warrants to purchase an aggregate of 1,820,000 shares of the Company’s common stock in conjunction with a debt agreement as discussed in Note 15 – Debt Agreements On August 25, 2021, the Company issued warrants to purchase an aggregate of 1,315,789 shares of the Company’s common stock in conjunction with a debt agreement as discussed in Note 15 – Debt Agreements All warrants are valued utilizing the Black-Scholes pricing model using the assumptions listed below. The weighted average grant date fair value of all warrants issued during the nine months ended September 30, 2021, was $1.328 per share. The following table summarizes the assumptions used to estimate the fair value of warrants granted during the nine months ended September 30, 2021: 2021 Expected dividend yield 0 % Expected volatility 39.94 - 46.22 % Risk-free interest rate 0.42 - 0.84 % Contractual life of warrants 5.00 years The following tables represents warrant activity for the nine months ended September 30, 2021 and 2020: (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2020 890,416 $ 1.46 4.02 $ 4,083 Exercisable – December 31, 2020 890,416 $ 1.46 4.02 $ 4,083 Granted/Issued 10,804,881 4.09 4.45 — Exercised — — — — Forfeited or Expired (13,706 ) 1.90 0.85 1 Outstanding – September 30, 2021 11,681,591 $ 3.89 4.37 $ 679 Exercisable – September 30, 2021 11,681,591 $ 3.89 4.37 $ 679 (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2019 167,846 $ 2.85 1.96 $ 258 Exercisable – December 31, 2019 167,846 $ 2.85 1.96 $ 258 Granted 858,985 1.39 4.43 5,016 Exercised (94,510 ) 0.03 1.25 678 Forfeited or Expired — — — — Outstanding – September 30, 2020 932,321 $ 1.79 4.17 $ 5,251 Exercisable – September 30, 2020 932,321 $ 1.79 4.17 $ 5,251 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 17. COMMITMENTS AND CONTINGENCIES From time to time, the Company may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. Management does not believe that after the final disposition any of these matters is likely to have a material adverse impact on the Company’s financial condition, results of operations or cash flows. |
Concentration
Concentration | 9 Months Ended |
Sep. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION | 18. CONCENTRATION Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of trade accounts receivable. The Company performs ongoing credit evaluations of its customers and generally does not require collateral related to its trade accounts receivable. At September 30, 2021, accounts receivable from customers comprised approximately 97% of the Company’s total trade accounts receivable, and none of this balance had been characterized as uncollectible. In addition, for the nine months ended September 30, 2021, there were no customers that individually exceeded 10% of revenue. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 19. SUBSEQUENT EVENTS Corporate Acquisition On October 4, 2021, the Company completed the acquisition of SAGUNA Networks LTD (“SAGUNA”), a Israeli company for total consideration of approximately $13.6 million worth of shares of restricted common stock. Public Offering of Preferred Series A On October 29, 2021 (the “Preferred Series A Offering Closing Date”), the Company sold an aggregate of 320,000 shares of the Company’s newly-designated 9.25% Series A Cumulative Redeemable Perpetual Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”), at a public offering price of $25.00 per share, which is the initial liquidation preference of the Series A Preferred Stock. Pursuant to the terms of the Underwriting Agreement dated October 26, 2021, the Company granted the Underwriters a 30-day option to purchase up to an additional 48,000 shares of Series A Preferred Stock. The Series A Preferred Stock was offered and sold pursuant to a prospectus supplement, dated October 26, 2021 (the “Prospectus Supplement”), and a base prospectus, dated September 14, 2021, relating to the Company’s effective shelf registration statement (the “Registration Statement”) on Form S-3 (File No. 333-259307). The Series A Preferred Stock has been listed on The Nasdaq Capital Market under the symbol “COMSP”. On the Preferred Series A Offering Closing Date, the Company received gross proceeds of approximately $7.2 million, before deducting underwriting discounts and commissions of eight percent (8%) of the gross proceeds and estimated offering expenses. The total expenses of the Preferred Series A Offering were approximately $0.9 million, which included the underwriting discounts and commissions and the Representative’s reimbursable expenses relating to the Preferred Series A Offering. The Company intends to use $2.75 million of the net proceeds from the Offering for the repayment of certain indebtedness and the balance for general corporate and working capital purposes. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Acquisitions | Acquisitions The Company accounts for business combinations under the acquisition method of accounting, in accordance with ASC Topic 805, Business Combinations |
Accounting Standards Not Yet Adopted | Accounting Standards Not Yet Adopted The Company applies the guidance of Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. The Company recognizes the fair value of assets acquired and liabilities assumed in transactions; establishes the acquisition date fair value as the measurement objective for all assets acquired and liabilities assumed; expenses transaction and restructuring costs; and discloses the information needed to evaluate and understand the nature and financial effect of the business combination. In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Business Combination (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
Earnings Per Share | Earnings Per Share Potential common shares issuable to employees, non-employees and directors upon exercise or conversion of shares are excluded from the computation of diluted earnings per common share when the effect would be anti-dilutive. All potential common shares are anti-dilutive in periods of net loss available to common shareholders. Stock options and warrants are anti-dilutive when the exercise price of these instruments is greater than the average market price of the Company’s common stock for the period (out-of-the-money), regardless of whether the Company is in a period of net loss available to common shareholders. The following weighted-average potential common shares were excluded from the diluted loss per common share as their effect was anti-dilutive as of September 30, 2021 and 2020, respectively: stock options of 2,513,513 and 2,548,345, unvested restricted stock units of 330,046 and 314,938, warrants of 8,815,210 and 94,465, and convertible notes that, if converted, would result in an estimated 2,391,336 and 229,348 shares of common stock. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue Disclosure [Abstract] | |
Schedule of timing of revenue recognition | Three Months Ended Nine months ended (Amounts in thousands) 2021 2020 2021 2020 Timing of revenue recognition: Services and products transferred at a point in time $ 3,979 $ 1,941 $ 9,348 $ 7,056 Services and products transferred over time 136 77 464 457 Total revenue $ 4,115 $ 2,018 $ 9,812 $ 7,513 |
Schedule of revenue by products and services | Three Months Ended Nine months ended (Amounts in thousands) 2021 2020 2021 2020 Revenue by products and services: Products $ 3,847 $ 1,726 $ 8,713 $ 6,298 Services 268 292 1,099 1,215 Total revenue $ 4,115 $ 2,018 $ 9,812 $ 7,513 |
Schedule of revenue by geography | Three Months Ended Nine months ended (Amounts in thousands) 2021 2020 2021 2020 Revenue by geography: North America $ 3,665 $ 1,831 $ 7,945 $ 6,755 International 450 187 1,867 758 Total revenue $ 4,115 $ 2,018 $ 9,812 $ 7,513 |
Schedule of opening and closing balances of contract liabilities | (Amounts in thousands) Total Balance at December 31, 2020 $ 864 Increase 2,190 Balance at September 30, 2021 $ 3,054 |
Cash and Cash Equivalents (Tabl
Cash and Cash Equivalents (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of cash and cash equivalents consisted | (Amounts in US$’s) September 30, December 31, Cash and cash equivalents $ 2,449 $ 731 Restricted cash 420 — Total cash, cash equivalents and restricted cash in the Statement of Cash Flows $ 2,869 $ 731 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | |
Schedule of accounts receivable, net | (Amounts in US$’s) September 30, December 31, Account receivables $ 2,957 $ 2,474 Less: Allowance for doubtful accounts (1,014 ) (1,687 ) Total account receivables, net $ 1,943 $ 787 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | (Amounts in thousands) September 30, December 31, Raw materials $ 5,827 $ 1,765 Work in progress 1,682 461 Finished goods 4,598 3,305 Total inventory 12,107 5,531 Reserve (1,288 ) (993 ) Total inventory, net $ 10,819 $ 4,538 |
Prepaid (Tables)
Prepaid (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Prepaid [Abstract] | |
Schedule of prepaid expenses | (Amounts in thousands) September 30, December 31, Prepaid products and services $ 6,475 $ 172 Deferred offering expenses — 569 Prepaid rent and security deposit 259 732 $ 6,734 $ 1,473 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment, net | (Amounts in thousands) September 30, December 31, Shop machinery and equipment $ 11,556 $ 9,961 Computers and electronics 1,454 575 Office furniture and fixtures 710 348 Building 4,801 — Land 1,330 — Leasehold improvements 1,269 274 21,120 11,158 Less - accumulated depreciation (11,324 ) (8,872 ) $ 9,796 $ 2,286 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases Disclosure [Abstract] | |
Schedule of other information related to our operating leases | (Amounts in thousands) For the Operating lease ROU Asset – December 31, 2020 $ 2,725 Increase 1,890 Decrease — Amortization (748 ) Operating lease ROU Asset – September 30, 2021 $ 3,867 Operating lease liability – December 31, 2020 $ 2,885 Increase 1,883 Decrease (30 ) Amortization (705 ) Operating lease liability – September 30, 2021 $ 4,033 Operating lease liability – short term $ 1,021 Operating lease liability – long term 3,012 Operating lease liability – total $ 4,033 Operating lease cost $ 911 Variable lease cost $ — Short-term lease cost $ 129 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 890 |
Schedule of weighted-average remaining lease term and weighted average discount rates of operating leases | September 30, December 31, Weighted average remaining lease term 6.13 years 4.19 years Weighted average discount rate 4.4 % 5.95 % |
Schedule of total remaining years to lease liabilities | (Amounts in thousands) Operating Remainder of 2021 $ 358 2022 1,240 2023 1,104 2024 767 2025 444 Thereafter 983 Total minimum lease payments 4,896 Less: effect of discounting (863 ) Present value of future minimum lease payments 4,033 Less: current obligations under leases (1,021 ) Long-term lease obligations $ 3,012 |
Schedule of finance leases information | (Amounts in thousands) For the Finance lease ROU Asset – December 31, 2020 $ 68 Increase 187 Decrease (22 ) Amortization (17 ) Finance lease ROU Asset – September 30, 2021 $ 216 Finance lease liability – December 31, 2020 $ 55 Increase 188 Interest accretion 1 Payment (40 ) Operating lease liability – September 30, 2021 $ 204 Finance lease liability – short term $ 66 Finance lease liability – long term 138 Finance lease liability – total $ 204 |
Schedule of weighted-average remaining lease term and weighted average discount rates of finance leases | September 30, December 31, Weighted average remaining lease term 3.18 years 1.10 years Weighted average discount rate 0.54 % 3.91 % |
Schedule of total remaining years to the finance lease liabilities | (Amounts in thousands) Finance Remainder of 2021 $ 23 2022 72 2023 63 2024 49 2025 11 Thereafter 6 Total minimum lease payments 224 Less: effect of discounting (20 ) Present value of future minimum lease payments 204 Less: current obligations under leases (66 ) Long-term lease obligations $ 138 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Skyline Partners Technology LLC [Member] | |
Business Acquisitions (Tables) [Line Items] | |
Schedule of allocation of total preliminary estimated purchase price | (Amounts in thousands) Fair Value Cash $ 9 Accounts receivable 245 Inventory 358 Prepaid expenses 1,914 Property & equipment 202 Intangible assets: Intellectual Property 3,502 Software 96 Goodwill 9,527 Total assets 15,853 Accounts payable 1,055 Accrued liabilities 174 Notes payable 210 Contract liabilities, current 213 Accrued warranty liability – long term 236 Total purchase consideration $ 13,965 (Amounts in thousands) Fair Value Cash $ 320 Accounts receivable 60 Inventory 1,229 Prepaid expenses 15 Other current assets 334 Property & equipment 148 Operating lease right-of-use assets 472 Intangible assets: Goodwill 13,115 Total assets 15,693 Accounts payable 710 Accrued liabilities 431 Contract liabilities, current 2,309 Operating lease liabilities, current 194 Operating lease liabilities - long term 267 Total purchase consideration $ 11,782 (Amounts in thousands) Fair Value Cash $ 449 Accounts receivable 47 Prepaid expenses 53 Inventory 825 Property & equipment 16 Operating lease right-of-use asset 270 Intangible assets: Goodwill 5,629 Total assets 7,289 Accounts payable 54 Accrued liabilities 219 Operating lease liabilities, current 74 Contract liabilities, current 793 Notes payable 453 Operating lease liabilities – long term 196 Total purchase consideration $ 5,500 (Amounts in thousands) Fair Value Property & equipment 6 Operating lease right-of-use asset 105 Other Non-Current Assets 2 Intangible assets: Goodwill 9,046 Total assets 9,159 Accounts payable 78 Operating lease liabilities, current 32 Notes payable 31 Operating lease liabilities – long term 74 Total purchase consideration $ 8,944 (Amounts in thousands) Fair Value Cash $ 4 Accounts receivable 472 Prepaid expenses 42 Inventory 1,587 Other Current Assets 36 Property & equipment, net 72 Intangible assets: Goodwill 1,389 Total assets 3,602 Accounts payable 375 Accrued liabilities 4 Contract liabilities, current 20 Notes payable 453 Total purchase consideration $ 2,750 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in carrying amount of goodwill | (Amounts in thousands) Total Balance at December 31, 2020 $ 64,898 2021 Acquisitions 38,706 Balance at September 30, 2021 $ 103,604 |
Schedule of gross carrying amounts and accumulated amortization | (Amounts in thousands) Gross Accumulated Net Definite-lived intangible assets: Trade names $ 5,974 $ (1,350 ) $ 4,624 Licenses 350 (34 ) 316 Technology 39,350 (10,304 ) 29,046 Customer relationships 21,201 (5,485 ) 15,716 Intellectual property 3,730 (673 ) 3,057 Noncompete 937 (508 ) 429 Total definite-lived intangible assets at December 31, 2020 $ 71,542 $ (18,354 ) $ 53,188 Trade names $ 5,974 $ (2,037 ) $ 3,936 Licenses 69 (69 ) — Technology 39,350 (15,222 ) 24,128 Customer relationships 21,201 (8,365 ) 12,836 Intellectual property 7,232 (1,457 ) 5,775 Noncompete 937 (859 ) 78 Capitalized software 1,329 (48 ) 1,282 Total definite-lived intangible assets at September 30, 2021 $ 76,092 $ (28,057 ) $ 48,035 |
Schedule of intangible asset | Asset Class Weighted- Trade names 6.8 years Licenses 5.0 years Technology 6.0 years Customer relationships 5.7 years Intellectual property 6.5 years Noncompete 2.0 years Capitalized software 4.7 years All Intangible assets 6.0 years |
Schedule of amortization expense for intangible assets | (Amounts in thousands) Estimated Remainder of 2021 $ 4,234 2022 12,689 2023 12,576 2024 10,494 2025 4,688 2026 2,057 Thereafter 1,297 Total $ 48,035 |
Debt Agreements (Tables)
Debt Agreements (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of future maturities of long-term debt | (Amounts in thousands) Remainder of 2021 $ 2,879 2022 16,815 2023 3,742 2024 9 2025 9 Thereafter 11,348 Total $ 34,802 Less unamortized discounts and debt issuance costs (4,371 ) Total net debt 30,431 Less current portion of long-term debt, net of unamortized discounts and debt issuance costs (12,354 ) Total long-term debt, net of unamortized discounts and debt issuance costs 18,077 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Warrant [Member] | |
Share-Based Compensation (Tables) [Line Items] | |
Schedule of assumptions used to estimate fair value stock options granted | 2021 Expected dividend yield 0 % Expected volatility 46.5 - 53.02 % Risk-free interest rate 0.48 - 0.89 % Expected life of options 3.00 - 5.00 years 2021 Expected dividend yield 0 % Expected volatility 39.94 - 46.22 % Risk-free interest rate 0.42 - 0.84 % Contractual life of warrants 5.00 years |
Schedule of stock option activity | (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2020 890,416 $ 1.46 4.02 $ 4,083 Exercisable – December 31, 2020 890,416 $ 1.46 4.02 $ 4,083 Granted/Issued 10,804,881 4.09 4.45 — Exercised — — — — Forfeited or Expired (13,706 ) 1.90 0.85 1 Outstanding – September 30, 2021 11,681,591 $ 3.89 4.37 $ 679 Exercisable – September 30, 2021 11,681,591 $ 3.89 4.37 $ 679 (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2019 167,846 $ 2.85 1.96 $ 258 Exercisable – December 31, 2019 167,846 $ 2.85 1.96 $ 258 Granted 858,985 1.39 4.43 5,016 Exercised (94,510 ) 0.03 1.25 678 Forfeited or Expired — — — — Outstanding – September 30, 2020 932,321 $ 1.79 4.17 $ 5,251 Exercisable – September 30, 2020 932,321 $ 1.79 4.17 $ 5,251 |
Stock Options [Member] | |
Share-Based Compensation (Tables) [Line Items] | |
Schedule of stock option activity | (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2020 3,433,515 $ 1.59 2.01 $ 15,221 Exercisable – December 31, 2020 3,400,181 1.58 1.99 15,129 Granted 4,532,000 2.76 4.51 — Exercised (63,333 ) 0.26 3.77 85 Cancelled or Expired (856,669 ) 1.78 0.18 91 Outstanding – September 30, 2021 7,045,513 $ 2.33 3.51 $ 830 Exercisable – September 30, 2021 2,513,513 $ 1.56 1.70 $ 830 (Amounts in thousands except per share data) Number of Weighted- Weighted- Aggregate Outstanding – December 31, 2019 2,898,347 $ 1.90 1.92 $ 2,265 Exercisable – December 31, 2019 2,898,347 1.90 1.92 2,265 Granted 908,505 0.77 4.59 5,838 Exercised — — — — Cancelled or Expired (333,335 ) 2.01 0.59 1,903 Outstanding – September 30, 2020 3,440,183 $ 1.59 2.26 $ 19,339 Exercisable – September 30, 2020 3,406,849 $ 1.58 2.24 $ 19,207 |
Description of Business and B_2
Description of Business and Basis of Presentation (Details) | 1 Months Ended | 9 Months Ended |
Jan. 29, 2021 | Sep. 30, 2021 | |
Accounting Policies [Abstract] | ||
Area square feet description | On January 29, 2021, the Company, through its wholly-owned subsidiary, AZCOMS LLC (“AZCOMS”), completed the acquisition of a 140,000-square-foot building in Tucson, Arizona, and will hold and service the related debt as described in Note 13 – Debt Agreements. | |
Description of agreement | The unaudited Condensed Consolidated Financial Statements included herein should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Details) - shares | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Accounting Policies [Abstract] | ||
Stock option | 2,513,513 | 2,548,345 |
Unvested restricted stock units | 330,046 | 314,938 |
Warrants | 8,815,210 | 94,465 |
Shares of common stock | 2,391,336 | 229,348 |
Going Concern (Details)
Going Concern (Details) - Management's Liquidity Plans [Member] $ in Millions | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Going Concern (Details) [Line Items] | |
Cash flows from operations | $ (33.4) |
Accumulated deficit | $ (102.1) |
Revenue (Details)
Revenue (Details) $ in Millions | Sep. 30, 2021USD ($) |
Revenue Disclosure [Abstract] | |
Contract liabilities | $ 2.2 |
Revenue (Details) - Schedule of
Revenue (Details) - Schedule of timing of revenue recognition - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Timing of revenue recognition: | ||||
Services and products transferred at a point in time | $ 3,979 | $ 1,941 | $ 9,348 | $ 7,056 |
Services and products transferred over time | 136 | 77 | 464 | 457 |
Total revenue | $ 4,115 | $ 2,018 | $ 9,812 | $ 7,513 |
Revenue (Details) - Schedule _2
Revenue (Details) - Schedule of revenue by products and services - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue by products and services: | ||||
Total revenue | $ 4,115 | $ 2,018 | $ 9,812 | $ 7,513 |
Products [Member] | ||||
Revenue by products and services: | ||||
Total revenue | 3,847 | 1,726 | 8,713 | 6,298 |
Services [Member] | ||||
Revenue by products and services: | ||||
Total revenue | $ 268 | $ 292 | $ 1,099 | $ 1,215 |
Revenue (Details) - Schedule _3
Revenue (Details) - Schedule of revenue by geography - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue by geography: | ||||
Total revenue | $ 4,115 | $ 2,018 | $ 9,812 | $ 7,513 |
North America [Member] | ||||
Revenue by geography: | ||||
Total revenue | 3,665 | 1,831 | 7,945 | 6,755 |
International [Member] | ||||
Revenue by geography: | ||||
Total revenue | $ 450 | $ 187 | $ 1,867 | $ 758 |
Revenue (Details) - Schedule _4
Revenue (Details) - Schedule of opening and closing balances of contract liabilities $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Schedule of opening and closing balances of contract liabilities [Abstract] | |
Balance at December 31, 2020 | $ 864 |
Increase | 2,190 |
Balance at September 30, 2021 | $ 3,054 |
Cash and Cash Equivalents (Deta
Cash and Cash Equivalents (Details) - Schedule of cash and cash equivalents consisted - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of cash and cash equivalents consisted [Abstract] | ||
Cash and cash equivalents | $ 2,449 | $ 731 |
Restricted cash | 420 | |
Total cash, cash equivalents and restricted cash in the Statement of Cash Flows | $ 2,869 | $ 731 |
Accounts Receivable, Net (Detai
Accounts Receivable, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Accounts Receivable, after Allowance for Credit Loss [Abstract] | ||||
Bad debt expense | $ 0 | $ 650 | $ 200 | $ 650 |
Accounts Receivable, Net (Det_2
Accounts Receivable, Net (Details) - Schedule of accounts receivable, net - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of accounts receivable, net [Abstract] | ||
Account receivables | $ 2,957 | $ 2,474 |
Less: Allowance for doubtful accounts | (1,014) | (1,687) |
Total account receivables, net | $ 1,943 | $ 787 |
Inventory (Details) - Schedule
Inventory (Details) - Schedule of inventory - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of inventory [Abstract] | ||
Raw materials | $ 5,827 | $ 1,765 |
Work in progress | 1,682 | 461 |
Finished goods | 4,598 | 3,305 |
Total inventory | 12,107 | 5,531 |
Reserve | (1,288) | (993) |
Total inventory, net | $ 10,819 | $ 4,538 |
Prepaid (Details) - Schedule of
Prepaid (Details) - Schedule of prepaid expenses - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of prepaid expenses [Abstract] | ||
Prepaid products and services | $ 6,475 | $ 172 |
Deferred offering expenses | 569 | |
Prepaid rent and security deposit | 259 | 732 |
Prepaid expenses, net | $ 6,734 | $ 1,473 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 510 | $ 280 | $ 800 | $ 1,340 |
Property and Equipment, Net (_2
Property and Equipment, Net (Details) - Schedule of property and equipment, net - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 21,120 | $ 11,158 |
Less - accumulated depreciation | (11,324) | (8,872) |
Property and equipment, net | 9,796 | 2,286 |
Shop machinery and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 11,556 | 9,961 |
Computers and electronics [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,454 | 575 |
Office furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 710 | 348 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,801 | |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,330 | |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,269 | $ 274 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | |||
May 31, 2021 | Apr. 30, 2021 | Feb. 25, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | |
Leases (Details) [Line Items] | |||||
Weighted average remaining operating lease term | 6 years 1 month 17 days | 4 years 2 months 8 days | |||
Monthly payments of operating lease | $ 2 | ||||
Lease agreement, description | In May 2021, DragonWave entered into an amendment to its existing facility lease to extend the expiration date through June 20, 2022 and to increase the annual base to $12 thousand per month. The lease did not include an implicit rate of return; therefore, the Company used an incremental borrowing rate based on other leases with similar terms. The modification resulted in additional right-of-use asset and lease liability of $0.12 million As part of the RVision business acquisition on April 1, 2021, the Company assumed a lease of office space with a remaining term of approximately 33 months that will expire on March 31, 2024. Monthly payments are $7 thousand during the remaining life of the lease. | Monthly payments range from approximately $1 thousand to approximately $2 thousand. Each lease had an implicit rate of 6.0% and no renewal options. | |||
Office Space [Member] | |||||
Leases (Details) [Line Items] | |||||
Weighted average remaining operating lease term | 22 months | ||||
Monthly payments of operating lease | $ 16 | ||||
Vehicles [Member] | |||||
Leases (Details) [Line Items] | |||||
Weighted average remaining operating lease term | 11 months | ||||
Minimum [Member] | Vehicles [Member] | |||||
Leases (Details) [Line Items] | |||||
Leases included an implicit rates | 5.41% | ||||
Maximum [Member] | Vehicles [Member] | |||||
Leases (Details) [Line Items] | |||||
Leases included an implicit rates | 6.00% |
Leases (Details) - Schedule of
Leases (Details) - Schedule of other information related to our operating leases - Other information related [Member] $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Leases (Details) - Schedule of other information related to our operating leases [Line Items] | |
Operating lease ROU Asset | $ 2,725 |
Increase | 1,890 |
Decrease | |
Amortization | (748) |
Operating lease ROU Asset | 3,867 |
Operating lease liability | 2,885 |
Increase | 1,883 |
Decrease | (30) |
Amortization | (705) |
Operating lease liability | 4,033 |
Operating lease liability – short term | 1,021 |
Operating lease liability – long term | 3,012 |
Operating lease liability – total | 4,033 |
Operating lease cost | 911 |
Variable lease cost | |
Short-term lease cost | 129 |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 890 |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of weighted-average remaining lease term and weighted average discount rates of operating leases | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of weighted-average remaining lease term and weighted average discount rates of operating leases [Abstract] | ||
Weighted average remaining lease term | 6 years 1 month 17 days | 4 years 2 months 8 days |
Weighted average discount rate | 4.40% | 5.95% |
Leases (Details) - Schedule o_3
Leases (Details) - Schedule of total remaining years to lease liabilities - Operating Leases [Member] $ in Thousands | Sep. 30, 2021USD ($) |
Leases (Details) - Schedule of total remaining years to lease liabilities [Line Items] | |
Remainder of 2021 | $ 358 |
2022 | 1,240 |
2023 | 1,104 |
2024 | 767 |
2025 | 444 |
Thereafter | 983 |
Total minimum lease payments | 4,896 |
Less: effect of discounting | (863) |
Present value of future minimum lease payments | 4,033 |
Less: current obligations under leases | (1,021) |
Long-term lease obligations | $ 3,012 |
Leases (Details) - Schedule o_4
Leases (Details) - Schedule of finance leases information $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Schedule of finance leases information [Abstract] | |
Finance lease ROU Asset – December 31, 2020 | $ 68 |
Increase | 187 |
Decrease | (22) |
Amortization | (17) |
Finance lease ROU Asset – September 30, 2021 | 216 |
Finance lease liability – December 31, 2020 | 55 |
Increase | 188 |
Interest accretion | 1 |
Payment | (40) |
Operating lease liability – September 30, 2021 | 204 |
Finance lease liability – short term | 66 |
Finance lease liability – long term | 138 |
Finance lease liability – total | $ 204 |
Leases (Details) - Schedule o_5
Leases (Details) - Schedule of weighted-average remaining lease term and weighted average discount rates of finance leases | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule of weighted-average remaining lease term and weighted average discount rates of finance leases [Abstract] | ||
Weighted average remaining lease term | 3 years 2 months 4 days | 1 year 1 month 6 days |
Weighted average discount rate | 0.54% | 3.91% |
Leases (Details) - Schedule o_6
Leases (Details) - Schedule of total remaining years to the finance lease liabilities $ in Thousands | Sep. 30, 2021USD ($) |
Schedule of total remaining years to the finance lease liabilities [Abstract] | |
Remainder of 2021 | $ 23 |
2022 | 72 |
2023 | 63 |
2024 | 49 |
2025 | 11 |
Thereafter | 6 |
Total minimum lease payments | 224 |
Less: effect of discounting | (20) |
Present value of future minimum lease payments | 204 |
Less: current obligations under leases | (66) |
Long-term lease obligations | $ 138 |
Business Acquisitions (Details)
Business Acquisitions (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Jun. 03, 2021 | Apr. 02, 2021 | Feb. 25, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Jul. 16, 2021 | Jan. 29, 2021 | |
Skyline Partners Technology LLC [Member] | |||||||
Business Acquisitions (Details) [Line Items] | |||||||
Purchase price of consideration | $ 1,320,000 | ||||||
Principal amount | 1,500,000 | ||||||
Acquisition related cost | $ 79,000 | ||||||
Acquisition related costs expensed | $ 18,000 | $ 61,000 | |||||
Sky Sapience Ltd [Member] | |||||||
Business Acquisitions (Details) [Line Items] | |||||||
Purchase price of consideration | $ 11,780,000 | ||||||
Conversion price per share (in Dollars per share) | $ 3.55 | ||||||
Cash | $ 2,710,000 | ||||||
Number of shares of common stock issued (in Shares) | 2,555,209 | ||||||
Fair value of common stock | $ 9,070,000 | ||||||
Number of shares held in escrow fund (in Shares) | 1,151,461 | ||||||
RVision, Inc [Member] | |||||||
Business Acquisitions (Details) [Line Items] | |||||||
Fair value of common stock | $ 2,000,000 | ||||||
Outstanding capital stock | 100.00% | ||||||
Fair value per share price (in Dollars per share) | $ 2.75 | ||||||
Shares of common stock (in Shares) | 1,000,000 | ||||||
Innovation Digital, LLC [Member] | |||||||
Business Acquisitions (Details) [Line Items] | |||||||
Principal amount | $ 600,000 | ||||||
Conversion price per share (in Dollars per share) | $ 2.35 | ||||||
Fair value of common stock | $ 3,165,322 | ||||||
Fair value per share price (in Dollars per share) | $ 2.32 | ||||||
Cash consideration | $ 1,000,000 | ||||||
Common stock fair value | $ 7,340,000 | ||||||
Resale common stock (in Shares) | 3,165,322 | ||||||
RF Engineering & Energy Resource, LLC [Member] | |||||||
Business Acquisitions (Details) [Line Items] | |||||||
Principal amount | $ 2,220,000 | ||||||
Fair value of common stock | $ 992,780 | ||||||
Fair value per share price (in Dollars per share) | $ 2.2 | ||||||
Cash consideration | $ 550,000 | ||||||
Convertible Notes Payable [Member] | Skyline Partners Technology LLC [Member] | |||||||
Business Acquisitions (Details) [Line Items] | |||||||
Principal amount | $ 11,150,000 | ||||||
Conversion price per share (in Dollars per share) | $ 5.22 |
Business Acquisitions (Detail_2
Business Acquisitions (Details) - Schedule of allocation of total preliminary estimated purchase price $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Skyline Partners Technology LLC [Member] | |
Business Combination, Separately Recognized Transactions [Line Items] | |
Cash | $ 9 |
Accounts receivable | 245 |
Inventory | 358 |
Prepaid expenses | 1,914 |
Intangible assets: | |
Property & equipment | 202 |
Intangible assets: | |
Intellectual Property | 3,502 |
Software | 96 |
Goodwill | 9,527 |
Total assets | 15,853 |
Accounts payable | 1,055 |
Accrued liabilities | 174 |
Notes payable | 210 |
Contract liabilities, current | 213 |
Accrued warranty liability – long term | 236 |
Total purchase consideration | 13,965 |
Sky Sapience Ltd. [Member] | |
Business Combination, Separately Recognized Transactions [Line Items] | |
Cash | 320 |
Accounts receivable | 60 |
Inventory | 1,229 |
Prepaid expenses | 15 |
Other current assets | 334 |
Intangible assets: | |
Property & equipment | 148 |
Operating lease right-of-use asset | 472 |
Intangible assets: | |
Goodwill | 13,115 |
Total assets | 15,693 |
Accounts payable | 710 |
Accrued liabilities | 431 |
Contract liabilities, current | 2,309 |
Operating lease liabilities, current | 194 |
Operating lease liabilities - long term | 267 |
Total purchase consideration | 11,782 |
RVision, Inc [Member] | |
Business Combination, Separately Recognized Transactions [Line Items] | |
Cash | 449 |
Accounts receivable | 47 |
Inventory | 825 |
Prepaid expenses | 53 |
Intangible assets: | |
Property & equipment | 16 |
Operating lease right-of-use asset | 270 |
Intangible assets: | |
Goodwill | 5,629 |
Total assets | 7,289 |
Accounts payable | 54 |
Accrued liabilities | 219 |
Notes payable | 453 |
Contract liabilities, current | 793 |
Operating lease liabilities, current | 74 |
Operating lease liabilities - long term | 196 |
Total purchase consideration | 5,500 |
Innovation Digital, LLC [Member] | |
Intangible assets: | |
Property & equipment | 6 |
Operating lease right-of-use asset | 105 |
Other Non-Current Assets | 2 |
Intangible assets: | |
Operating lease liabilities – long term | 74 |
Intangible assets: | |
Goodwill | 9,046 |
Total assets | 9,159 |
Accounts payable | 78 |
Notes payable | 31 |
Operating lease liabilities, current | 32 |
Total purchase consideration | 8,944 |
RF Engineering & Energy Resource, LLC [Member] | |
Business Combination, Separately Recognized Transactions [Line Items] | |
Cash | 4 |
Accounts receivable | 472 |
Inventory | 1,587 |
Prepaid expenses | 42 |
Other current assets | 36 |
Property & equipment, net | 72 |
Intangible assets: | |
Goodwill | 1,389 |
Total assets | 3,602 |
Accounts payable | 375 |
Accrued liabilities | 4 |
Notes payable | 453 |
Contract liabilities, current | 20 |
Total purchase consideration | $ 2,750 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense of intangible assets | $ 3,220 | $ 2,620 | $ 9,670 | $ 7,850 |
Impairment expense | $ 280 |
Goodwill (Details) - Schedule o
Goodwill (Details) - Schedule of changes in carrying amount of goodwill $ in Thousands | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Schedule of changes in carrying amount of goodwill [Abstract] | |
Balance at December 31, 2020 | $ 64,898 |
2021 Acquisitions | 38,706 |
Balance at September 30, 2021 | $ 103,604 |
Goodwill (Details) - Schedule_2
Goodwill (Details) - Schedule of gross carrying amounts and accumulated amortization - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Definite-lived intangible assets: | ||
Gross Carrying Amount | $ 76,092 | $ 71,542 |
Accumulated Amortization | (28,057) | (18,354) |
Net Carrying Amount | 48,035 | 53,188 |
Trade names [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 5,974 | 5,974 |
Accumulated Amortization | (2,037) | (1,350) |
Net Carrying Amount | 3,936 | 4,624 |
Licenses [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 69 | 350 |
Accumulated Amortization | (69) | (34) |
Net Carrying Amount | 316 | |
Technology [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 39,350 | 39,350 |
Accumulated Amortization | (15,222) | (10,304) |
Net Carrying Amount | 24,128 | 29,046 |
Customer relationships [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 21,201 | 21,201 |
Accumulated Amortization | (8,365) | (5,485) |
Net Carrying Amount | 12,836 | 15,716 |
Intellectual property [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 7,232 | 3,730 |
Accumulated Amortization | (1,457) | (673) |
Net Carrying Amount | 5,775 | 3,057 |
Noncompete [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 937 | 937 |
Accumulated Amortization | (859) | (508) |
Net Carrying Amount | 78 | $ 429 |
Capitalized software [Member] | ||
Definite-lived intangible assets: | ||
Gross Carrying Amount | 1,329 | |
Accumulated Amortization | (48) | |
Net Carrying Amount | $ 1,282 |
Goodwill (Details) - Schedule_3
Goodwill (Details) - Schedule of major intangible asset class | 9 Months Ended |
Sep. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 6 years |
Trade Names [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 6 years 9 months 18 days |
Licenses [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 5 years |
Technology [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 6 years |
Customer relationships [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 5 years 8 months 12 days |
Intellectual Property [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 6 years 6 months |
Noncompete [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 2 years |
Capitalized software [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Weighted- Average Amortization period | 4 years 8 months 12 days |
Goodwill (Details) - Schedule_4
Goodwill (Details) - Schedule of amortization expense for intangible assets $ in Thousands | Sep. 30, 2021USD ($) |
Schedule of amortization expense for intangible assets [Abstract] | |
Remainder of 2021 | $ 4,234 |
2022 | 12,689 |
2023 | 12,576 |
2024 | 10,494 |
2025 | 4,688 |
2026 | 2,057 |
Thereafter | 1,297 |
Total | $ 48,035 |
Debt Agreements (Details)
Debt Agreements (Details) - USD ($) | Jun. 03, 2021 | Jan. 15, 2021 | Dec. 08, 2020 | Jul. 07, 2020 | Jul. 02, 2020 | Mar. 06, 2020 | Mar. 05, 2020 | Nov. 07, 2019 | Sep. 11, 2019 | Oct. 29, 2021 | Aug. 25, 2021 | May 27, 2021 | Jan. 29, 2021 | Jan. 26, 2021 | Nov. 24, 2020 | Aug. 21, 2020 | Apr. 30, 2020 | Mar. 19, 2020 | Feb. 26, 2020 | Nov. 30, 2019 | Sep. 24, 2019 | Apr. 30, 2019 | Aug. 31, 2016 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Sep. 30, 2020 | May 29, 2020 | Dec. 31, 2019 | Oct. 31, 2017 |
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 87,000 | $ 5,800,000 | $ 450,000 | $ 40,000 | $ 580,000 | $ 0.29 | ||||||||||||||||||||||||
Debt instrument interest rate | 3.00% | 6.00% | 10.00% | 12.00% | ||||||||||||||||||||||||||
Debt instrument maturity date | Feb. 16, 2023 | Aug. 25, 2025 | ||||||||||||||||||||||||||||
Aggregate principal amount outstanding loan | 2,000,000 | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 22,000 | $ 1,500,000 | 83,000 | |||||||||||||||||||||||||||
Secured loan agreement, description | the Company assumed a secured loan with FirstBank in the principal amount of $0.98 million that bore interest at 5% per annum, with a maturity date of June 1, 2020. This loan was subsequently extended to September 15, 2020 and the interest rate was increased to 36% per annum for any principal balance remaining unpaid past the extended maturity date. The loan was secured by certain assets of Sovereign Plastics. This loan was subjected to covenants, whereby Sovereign Plastics was required to meet certain financial and non-financial covenants at the end of each fiscal year. As of December 31, 2020, an aggregate principal amount of $0.86 million was outstanding and past due under this loan. | |||||||||||||||||||||||||||||
Loan converted into common stock, decription | in connection with its acquisition of the new manufacturing facility in Tucson, Arizona, AZCOMS entered into a secured loan agreement pursuant to which it received a loan in the amount of up to $5.36 million that bears interest on the outstanding loan balance at the greater of (i) 8% per annum or (ii) 6.75% per annum in excess of the 1-month LIBOR rate, and matures on January 15, 2022. At the closing of the loan, the lender withheld $0.51 million of the loan amount as an interest reserve. In addition, $0.88 million of the loan amount was withheld and may be disbursed at later dates to pay for lender-approved improvements to the property secured by the loan. Interest is payable monthly. The loan is due in full at maturity. Upon an event of default, the interest rate on the loan will increase by an additional 5.00% per annum, and the outstanding principal amount of the loan, accrued interest thereon and fees may become due on-demand. Upon the maturity date or earlier date upon which the unpaid balance of the loan may become immediately payable due to acceleration, and on any prepayments of the loan, AZCOMS will owe an exit fee equal to the greater of (a) $54 thousand, or (b) 1.00% of the unpaid loan balance and all unpaid accrued interest and fees. Subject to certain terms and conditions and upon payment of a fee, AZCOMS may request a six-month extension of the maturity date. The loan is secured by the land, building and certain other assets of AZCOMS and is guaranteed by the Company and Daniel L. Hodges, the Company’s Chief Executive Officer. In addition, all rights to leases and rent related to the land and building assets have been assigned to the lender for potential non-performance by AZCOMS of its obligations under the loan. This loan is subject to certain financial and non-financial covenants on the part of AZCOMS at the end of each fiscal quarter and fiscal year. The Company incurred debt issuance costs for transaction in the amount of $0.16 million. As of September 30, 2021, an aggregate principal amount of $5.00 million was outstanding under this loan.In connection with its acquisition of Fastback on January 29, 2021, the Company assumed the obligations of the sellers on a secured loan in the principal amount of $0.21 million that bears interest on the outstanding loan balance at the greater of (i) 5.75% per annum in excess of the Prime Rate or (ii) $4 thousand per month, with a maturity date of April 30, 2021. Interest is payable monthly. | $1.0 million of the principal amount of this loan and all accrued interest with a combined total of $1.23 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, resulting in the issuance of 295,674 shares of common stock, along with warrants to purchase up to 295,674 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026. The extinguishment on January 26, 2021 cured all events of default. As of September 30, 2021, an aggregate principal amount of $1.0 million was outstanding under this loan. | ||||||||||||||||||||||||||||
Loan interest rate | 5.00% | |||||||||||||||||||||||||||||
Accrued interest percentage | 10.00% | 10.00% | ||||||||||||||||||||||||||||
Interest rate percentage | 15.00% | 15.00% | ||||||||||||||||||||||||||||
Aggregate amount | $ 500,000 | |||||||||||||||||||||||||||||
Debt discount amount | $ 800,000 | $ 40,000 | ||||||||||||||||||||||||||||
Principal bonus percentage | 10.00% | |||||||||||||||||||||||||||||
Accrued interest | $ 890,000 | |||||||||||||||||||||||||||||
Extinguished rate (in Dollars per share) | $ 4.15 | |||||||||||||||||||||||||||||
Common stock, shares issued (in Shares) | 213,496 | 72,533,850 | 49,444,689 | |||||||||||||||||||||||||||
Purchase of common stock shares (in Shares) | 213,496 | |||||||||||||||||||||||||||||
Purchase price per share (in Dollars per share) | $ 4.5 | |||||||||||||||||||||||||||||
Debt instrument description | The principal amounts of the notes were between $50 thousand and $100 thousand. The notes had maturity dates between January 31, 2021 and February 23, 2021 that bore interest at a rate of 15% per annum, with interest accrued at an annually compounded rate of 18% per annum for any principal balance remaining unpaid past the maturity date. Daniel L. Hodges, the Company’s Chief Executive Officer, transferred a total of 38,334 shares of his personally owned, issued and outstanding common stock, with a fair value of $0.26 million, to the accredited investors, as part of this transaction. The Company accounted for this as a contribution from Mr. Hodges and as debt discounts and issuance costs. The Company defaulted on these notes during the 2020 fiscal year, causing the interest rate to increase to an annually compounded rate of 18% per annum, and the note and accrued interest to become due on-demand. The amounts recorded as debt discounts were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year. As of December 31, 2020, an aggregate principal amount of $0.55 million was outstanding under these notes. On January 26, 2021, $0.5 million of the aggregate principal amount of these notes, a 10% principal bonus, and accrued interest with a combined total of $0.57 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Shareholders’ Equity, resulting in the issuance of 136,324 shares of common stock, along with warrants to purchase up to 136,324 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026. The remaining $50 thousand aggregate principal amount of these notes was fully repaid during fiscal 2021. | |||||||||||||||||||||||||||||
Debt instrument maturity period, description | the Company issued to the seller, who became an employee of the Company, a convertible promissory note in the principal amount of $0.6 million that bears interest at the rate of 5% per annum, maturing on June 3, 2022. Accrued interest and principal is due at maturity. Commencing December 3, 2021, the outstanding principal and accrued interest on this note may be converted into shares of the Company’s common stock at an initial conversion price of $2.35 per share subject to certain terms, conditions and adjustment. As of September 30, 2021, the full principal amount of $0.6 million was outstanding. | the Company sold a convertible promissory note in the principal amount of $0.29 million with an original issue discount of $36 thousand that bore interest at a rate of 12.5% per annum, and warrants to purchase an additional 52,910 shares of common stock. Warrants to purchase up to 9,260 shares of common stock, were also issued to an unrelated third-party as a placement fee for the transaction. Terms and maturities are similar to the April 29, 2020 note, as disclosed in the Company’s annual 10-K. In connection with this note, the Company recognized debt discounts of $0.22 million. On July 28, 2020, the Company defaulted on this note under the related Registration Rights Agreement by not filing a registration statement by July 28, 2020. As a result, the aggregate principal balance increased by penalties and interest of $88 thousand. In addition, the interest rate was increased to 24% per annum, and the note and accrued interest became due on-demand. As of December 31, 2020, there was an aggregate principal amount of $0.37 million outstanding and past due under this note. On January 22, 2021, the note holder converted the full principal of $0.37 million and all accrued interest with a combined total of $0.42 million into 155,013 shares of common stock. | the Company sold $1.0 million aggregate principal amount of 9% Senior Convertible Debentures to an accredited investor that bore interest at a rate of 9% per annum and a maturity date of September 30, 2020, subsequently extended to November 30, 2020. Accrued interest and principal were due at maturity, with interest paid in cash or, at the Company’s option, in shares of common stock at the conversion price of $3.00 per share. Upon an event of default, the interest rate would automatically increase to 15% per annum. The debentures were convertible into shares of the Company’s common stock at a conversion price of $3.00 per share. The Company also issued warrants to purchase 33,334 shares of common stock that are exercisable for a purchase price of $3.00 per share, at any time on or prior to the earlier of December 31, 2022 or the second anniversary of the Company’s consummation of a public offering of its common stock in connection with an up-listing of the common stock to a national securities exchange. In connection with these debentures, the Company recorded total debt discounts of $0.16 million. Amounts recorded as debt discounts were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year, as a result of the debentures becoming due on-demand from the default event. As of December 31, 2020, an aggregate principal amount of $1.0 million was outstanding and past due under these debentures. On January 26, 2021, the holder of these debentures converted the principal amount of $0.9 million into 300,000 shares of common stock. The remaining principal amount of $0.1 million and accrued interest with a combined total of $0.16 million, was fully extinguished on January 26, 2021 at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, resulting in the issuance of, along with warrants to purchase up to 38,713 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026. | The Company issued to the buyer warrants to purchase up to 1,315,789 shares of common stock with an exercise price of $3.00 per share, subject to adjustment, any time prior to August 25, 2026, and a grant date fair value of $0.859 per share. The Company also paid aggregate cash debt issuance costs of $0.35 million. The resulting aggregate debt discount recorded by the Company of $2.28 million. Principal payments of $0.322 million plus interest are required to be paid monthly commencing five business days after a registration statement is declared effective, but in no event later than November 30, 2021. This note is guaranteed by each of the Company’s subsidiaries and is secured by a first priority lien on all of the assets and properties of the Company and the assets and properties of its subsidiaries, subject only to the liens securing approximately $1.0 million principal amount of outstanding indebtedness of one of its subsidiaries. As of September 30, 2021, an aggregate principal amount of $5.8 million was outstanding. | the Company sold a senior secured convertible promissory note in the principal amount of $11.0 million with an original issue discount of $1.0 million bearing an interest rate of 6% per annum that matures on May 27, 2023. The Company issued to the buyer warrants to purchase up to 1,820,000 shares of common stock with an exercise price of $4.50 per share, subject to adjustment, any time prior to May 27, 2026, and a grant date fair value of $0.505 per share. The Company also paid aggregate cash debt issuance costs of $0.69 million. The resulting aggregate debt discount recorded by the Company of $2.6 million. Principal payments of $0.61 million plus interest are required to be paid monthly commencing six months after the date of issuance. This note is guaranteed by each of the Company’s subsidiaries and is secured by a first priority lien on all of the assets and properties of the Company and the assets and properties of its subsidiaries, subject only to the liens securing approximately $1.0 million principal amount of outstanding indebtedness of one of its subsidiaries. On August 25, 2021, we amended and restated the senior secured convertible note we issued to reduce the initial conversion price of such note to $3.00 per share, and to adjust the exercise price of the warrants to $3.00 per share. As of September 30, 2021, he full principal amount of $11.0 million was outstanding. | the Company issued to the sellers $1.5 million aggregate principal amount of term promissory notes. The individual principal amounts of the notes ranged from $1 thousand to $393 thousand. These notes bore interest at the rate of 10% per annum and matured on the earlier of (i) January 1, 2022, (ii) the date on which an aggregate of $6.0 million worth of products and services are sold following the acquisition date by (A) Fastback or (B) the Company and its subsidiaries (other than Fastback) to certain specified Fastback customers, or (iii) the date on which the Company issues and sells shares of its common stock or debt securities to investors in a bona-fide arms-length financing transaction for aggregate consideration of at least $12.0 million. Interest was payable in cash semi-annually in arrears on each June 1 and December 1, commencing on June 1, 2021, and on the maturity date. Principal and any unpaid accrued interest was due on the maturity date. These notes matured on February 10, 2021 upon the Company’s closing of a public offering, as disclosed in Note 15- Shareholders’ Equity. However, the representative of the Fastback sellers requested that the Company withhold payment of principal and interest on these notes until a dispute among such sellers was resolved. As payment was withheld at the request of the sellers’ representative, no event of default had occurred and interest was accrued only through the maturity date. These notes were fully repaid during fiscal 2021. | the Company sold a convertible promissory note in the principal amount of $1.7 million with an original issue discount of $0.2 million that bore interest at a rate of 5.0% per annum and matured on November 20, 2020. Accrued interest and principal were due on the maturity date. Upon maturity, the interest rate automatically increased to the lesser of 18% per annum or the maximum amount permitted by applicable law on any unpaid principal and accrued interest. Following the maturity date, the note was convertible into shares of common stock at a conversion price equal to 65% of the lowest volume weighted average price of the common stock during the 20 consecutive trading days immediately preceding the conversion date. As additional consideration for the loan, the Company issued to the lender 133,334 shares of common stock at a fair value of $10.05 per share. Warrants to purchase up to 17,857 shares of common stock that are exercisable for a purchase price of $8.40 per share at any time on or prior to August 20, 2025, were also issued to an unrelated third-party as a placement fee for the transaction. These transactions resulted in the Company recognized aggregate debt discounts of $1.73 million. On November 21, 2020, the Company defaulted on this note by not repaying the principal and accrued interest by the maturity date, which resulted in the aggregate principal balance increasing by penalties and interest of $0.54 million. In addition, the interest rate was increased to 24% per annum. As of December 31, 2020, an aggregate principal amount of $2.24 million was outstanding and past due under this note. | |||||||||||||||||||||||
Aggregated amount | $ 730,000 | |||||||||||||||||||||||||||||
Common stock warrants purchase (in Shares) | 1,315,789 | |||||||||||||||||||||||||||||
Common stock conversion price, description | ComSovereign sold $0.25 million aggregate principal amount of 10% Senior Convertible Debentures that bore interest at a rate of 10% per annum and were scheduled to mature on December 31, 2021. Interest was paid semi-annually in arrears in June and December of each year in cash or, at ComSovereign’s option, in shares of common stock at the conversion price that is equal to the lesser of (1) $7.50 or (2) a future effective price per share of any common stock sold by ComSovereign. Upon an event of default, the interest rate shall automatically increase to 15% per annum. In connection with these debentures, ComSovereign recognized aggregate debt discounts of $0.25 million. On April 21, 2020, all unpaid accrued interest through December 31, 2019 was converted into 2,234 shares of common stock. Also on April 21, 2020, all the outstanding warrants were exercised at $0.03 per share into 94,510 issued shares of the Company’s common stock, resulting in full recognition in interest expense of the remaining debt discount. On April 30, 2020, these debentures were amended to provide for the conversion of the debentures into shares of the Company’s common stock instead of ComSovereign’s common stock and the conversion price was changed from $7.50 per share to $2.268 per share. The Company defaulted on these debentures during the 2020 fiscal year, causing the interest rate to increase to 15% per annum, and the debentures and accrued interest to become due on-demand. Any remaining amounts recorded as debt discounts were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year. As of December 31, 2020, an aggregate principal amount of $0.25 million was outstanding and past due under these debentures. On January 26, 2021, the holder of these debentures converted the aggregate principal and interest of $0.28 million into 125,186 shares of common stock. | |||||||||||||||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Net proceeds received | $ 2,750,000 | |||||||||||||||||||||||||||||
Promissory Note [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 550,000 | |||||||||||||||||||||||||||||
Debt instrument interest rate | 8.50% | |||||||||||||||||||||||||||||
Debt instrument maturity date | Feb. 28, 2020 | Aug. 31, 2018 | ||||||||||||||||||||||||||||
Related parties agreed outstanding balance | $ 810,000 | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding loan | $ 790,000 | |||||||||||||||||||||||||||||
Promissory Note Two [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | 67,000 | |||||||||||||||||||||||||||||
Debt instrument interest rate | 9.00% | |||||||||||||||||||||||||||||
Debt instrument maturity date | Mar. 1, 2022 | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding loan | 150,000 | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 750,000 | $ 450,000 | 1,200,000 | |||||||||||||||||||||||||||
Accrued interest percentage | 18.00% | |||||||||||||||||||||||||||||
Promissory Note Two [Member] | Accredited Investors [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 15.00% | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 1,200,000 | |||||||||||||||||||||||||||||
Accrued interest compounded rate | 18.00% | |||||||||||||||||||||||||||||
Promissory Note Three [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 500,000 | $ 50,000 | ||||||||||||||||||||||||||||
Debt instrument interest rate | 12.00% | 7.90% | ||||||||||||||||||||||||||||
Aggregate principal amount outstanding loan | 11,000 | |||||||||||||||||||||||||||||
Convertible Notes Payable [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 15.00% | |||||||||||||||||||||||||||||
Debt instrument maturity date | Nov. 26, 2021 | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | 75,000 | |||||||||||||||||||||||||||||
Net proceeds received | $ 2,000,000 | |||||||||||||||||||||||||||||
Bearing interest rate | 9.00% | |||||||||||||||||||||||||||||
Secured loan agreement, description | The debt issuance costs were the result of the issuance of 350,000 shares of common stock and a cash payment of $80 thousand. The Company defaulted on this loan during fiscal 2020, which caused the interest rate to increase to a monthly compounded rate of 15% per annum, a late charge of 5% was incurred, and the loan and accrued interest became due on-demand. Amounts recorded as debt discounts and issuance costs were fully amortized and recognized in interest expense in the Condensed Consolidated Statement of Operations during the 2020 fiscal year, as a result of the loan becoming due on-demand from the default event. | |||||||||||||||||||||||||||||
Loan converted into common stock, decription | In connection with its acquisition of Fastback on January 29, 2021, the Company assumed the obligations of the sellers on a secured loan in the principal amount of $0.21 million that bears interest on the outstanding loan balance at the greater of (i) 5.75% per annum in excess of the Prime Rate or (ii) $4 thousand per month, with a maturity date of April 30, 2021. Interest is payable monthly. | |||||||||||||||||||||||||||||
Secured Notes Payable [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 78.99% | |||||||||||||||||||||||||||||
Debt instrument maturity date | Dec. 26, 2020 | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 600,000 | 1,100,000 | ||||||||||||||||||||||||||||
Loan converted into common stock, decription | On January 26, 2021, $0.4 million of the principal amount of this loan and accrued interest with a combined total of $0.5 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, resulting in the issuance of 119,418 shares of common stock, along with warrants to purchase up to 119,418 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026. The remaining $0.7 million principal amount of this loan was fully repaid during fiscal 2021. | |||||||||||||||||||||||||||||
Notes Payable [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 10.00% | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 1,100,000 | |||||||||||||||||||||||||||||
Secured loan agreement, description | In April 2020, the maturity date of this note was extended to August 31, 2020, the interest rate was increased to 12% per annum, and the Company provided to the lender 33,334 fully paid and non-assessable shares of its common stock that have been treated as debt issuance costs. As of December 31, 2020, an aggregate principal amount of $3.5 million was outstanding under this note. On January 26, 2021, the aggregate principal amount of this note and accrued interest with a combined total of $4.21 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, resulting in the issuance of 1,014,716 shares of common stock, along with warrants to purchase up to 1,014,716 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026. | the Company entered into a secured loan agreement in the amount of $2.01 million that bore interest at 5% per annum with a maturity date of August 31, 2020, which was subsequently extended to October 15, 2020. Upon maturity, the interest rate automatically increased to 18% per annum, and a late charge of 5% was charged for any balance overdue by more than 10 days. The loan was secured by certain intellectual property assets of the Company. As of December 31, 2020, an aggregate principal amount of $2.01 million was outstanding and past due under this loan. On January 26, 2021, the aggregate principal amount of this loan and accrued interest with a combined total of $2.25 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, plus a 10,000 unit conversion bonus, resulting in the issuance of 552,231 shares of common stock, along with warrants to purchase up to 552,231 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026 | ||||||||||||||||||||||||||||
Original issue discount | $ 100,000 | |||||||||||||||||||||||||||||
Interest rate, description | Upon an event of default, the interest rate would automatically increase to 36% per annum on any unpaid principal, or the maximum amount permitted by applicable law, compounded monthly, and all unpaid principal and accrued interest would become due on-demand. The loan was guaranteed by VNC and was secured by the Company’s equity interest in VNC, all of the assets of VNC and certain intellectual property assets of the Company. | |||||||||||||||||||||||||||||
Loan guaranteed, description | Daniel L. Hodges, the Company’s Chief Executive Officer, transferred a total of 23,334 shares of his personally owned, issued and outstanding common stock to the lender and brokers, as part of this transaction. The shares had a total fair value of $0.14 million. The Company accounted for this as a contribution from Mr. Hodges, as debt issuance costs. The Company incurred debt issuance costs to the placement agent of this transaction in the amount of $50 thousand. | |||||||||||||||||||||||||||||
Promissory Note Eight [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 15.00% | |||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 180,000 | 180,000 | ||||||||||||||||||||||||||||
October 2017 [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 4,400,000 | |||||||||||||||||||||||||||||
Debt instrument interest rate | 8.00% | |||||||||||||||||||||||||||||
Interest rate percentage | 10.00% | |||||||||||||||||||||||||||||
Issue discount amount | $ 400,000 | |||||||||||||||||||||||||||||
Accrued interest | $ 5,000,000 | |||||||||||||||||||||||||||||
Promissory Note Seven [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 580,000 | $ 450,000 | ||||||||||||||||||||||||||||
Interest rate increased | 133.00% | |||||||||||||||||||||||||||||
Aggregate principal amount | $ 200,000 | |||||||||||||||||||||||||||||
Promissory Note Seven [Member] | Subsequent Event [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 550,000 | |||||||||||||||||||||||||||||
New Promissory Note [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Promissory note, description | the Company sold a promissory note in the principal amount of $0.5 million with an original issue discount of $54 thousand, that matured on November 30, 2020. Additionally, in lieu of interest, the Company issued to the lender 16,667 shares of its common stock with a fair value of $57 thousand, which was recognized as a debt discount and amortized to interest expense over the term of the note. Any principal balance remaining unpaid past the maturity date accrued interest at a rate of 15% per annum. | |||||||||||||||||||||||||||||
DragonWave and Lextrum [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Secured loan agreement, description | In connection with its acquisition of DragonWave and Lextrum in April 2019, ComSovereign assumed the obligations of the seller of $0.1 million aggregate principal amount of 8% Senior Convertible Debentures of the seller that bore interest at the rate of 8% per annum and matured on December 31, 2019. Interest was payable semi-annually in cash or, at the seller’s option, in shares of the seller’s common stock at the conversion price that was equal to the lesser of (1) $24.00 or (2) 80% of the common stock price offered under the next equity offering. On April 30, 2020, these debentures were modified to remove the conversion feature and only have settlement through cash. During fiscal 2020, these debentures became past due and interest accrued at a rate of 15% per annum. As of December 31, 2020, an aggregate principal amount of $84 thousand was outstanding under these debentures. | |||||||||||||||||||||||||||||
Chief Executive Officer [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Issued and outstanding common stock (in Shares) | 96,634 | |||||||||||||||||||||||||||||
Issued and outstanding common stock fair vale | $ 480,000 | |||||||||||||||||||||||||||||
Equipment Financing Loan [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 180,000 | |||||||||||||||||||||||||||||
Minimum [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 1,000 | |||||||||||||||||||||||||||||
Minimum [Member] | Equipment Financing Loan [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 6.70% | |||||||||||||||||||||||||||||
Maximum [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 393,000 | |||||||||||||||||||||||||||||
Maximum [Member] | Equipment Financing Loan [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 8.50% | |||||||||||||||||||||||||||||
PPP Loans [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Principal amount | $ 770,000 | |||||||||||||||||||||||||||||
Debt instrument interest rate | 1.00% | |||||||||||||||||||||||||||||
PPP Loans [Member] | Subsidiary of Common Parent [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Debt instrument interest rate | 0.30% | |||||||||||||||||||||||||||||
principal amount of outstanding loan | $ 0.06 | |||||||||||||||||||||||||||||
PPP Loans [Member] | Minimum [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Loan maturity | 2 years | |||||||||||||||||||||||||||||
PPP Loans [Member] | Maximum [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Loan maturity | 5 years | |||||||||||||||||||||||||||||
Common Stock [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Converted shares (in Shares) | 4,832 | |||||||||||||||||||||||||||||
Equipment Financing Loan [Member] | ||||||||||||||||||||||||||||||
Debt Agreements (Details) [Line Items] | ||||||||||||||||||||||||||||||
Aggregate principal amount outstanding | $ 200,000 |
Debt Agreements (Details) - Sch
Debt Agreements (Details) - Schedule of future maturities of long-term debt $ in Thousands | Sep. 30, 2021USD ($) |
Schedule of future maturities of long-term debt [Abstract] | |
Remainder of 2021 | $ 2,879 |
2022 | 16,815 |
2023 | 3,742 |
2024 | 9 |
2025 | 9 |
Thereafter | 11,348 |
Total | 34,802 |
Less unamortized discounts and debt issuance costs | (4,371) |
Total net debt | 30,431 |
Less current portion of long-term debt, net of unamortized discounts and debt issuance costs | (12,354) |
Total long-term debt, net of unamortized discounts and debt issuance costs | $ 18,077 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 02, 2020 | Aug. 05, 2019 | Jan. 26, 2021 | Dec. 24, 2020 | Sep. 26, 2018 | Dec. 28, 2020 | Sep. 30, 2021 | Dec. 31, 2020 |
Related Party Transactions (Details) [Line Items] | ||||||||
Accrued liabilities - related party | $ 86 | $ 30 | ||||||
Accrued liabilities - related party | $ 31 | $ 30 | ||||||
Related party transactions, description | On January 26, 2021, the aggregate principal amount of this note, a 10% principal bonus, and all accrued interest with a combined total of $0.18 million, was fully extinguished at the rate of $4.15 per unit, as defined in our public offering and disclosed in Note 15- Stockholders’ Equity, resulting in the issuance of 42,776 shares of common stock, along with warrants to purchase up to 42,776 shares of common stock that are exercisable for a purchase price of $4.50 per share at any time on or prior to January 26, 2026. | |||||||
Daniel L. Hodges [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Aggregate principal amount | $ 200 | |||||||
Interest rate | 5.00% | |||||||
Default interest rate | 18.00% | 18.00% | ||||||
Outstanding amount | $ 200 | |||||||
Global Security Innovative Strategies [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Options to purchase of stock (in Shares) | 100,000 | |||||||
Option price (in Dollars per share) | $ 1 | |||||||
Payment for management fee | $ 10 | |||||||
Brent Davies [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Related party transactions, description | Brent Davies, a member of the Company’s Board of Directors and Audit Committee, loaned the Company $50 thousand at an interest rate of 4.80% per annum with an original maturity date of August 31, 2020. This note was amended to extend the maturity date to November 30, 2020. Interest and the full principal balance was due at maturity. During fiscal 2020, this loan became past due and was accruing interest at an increased default rate of 18.0% per annum. As of December 31, 2020, $50 thousand was outstanding and past due under the loan. | |||||||
Dr. Dustin McIntire [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Outstanding amount | $ 600 | |||||||
Related party transactions, description | Dustin McIntire, the Company’s Chief Technology Officer, and issued promissory notes evidencing such loans. The principal amounts of the notes were between $0.1 million and $0.4 million, and such notes bore interest at 10% per annum and were due between January 14, 2021 and March 28, 2021. | |||||||
Richard J. Berman [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Related party transactions, description | the Company borrowed an aggregate of $0.16 million from Richard J. Berman, a member of the Company’s Board of Directors, and issued promissory notes evidencing such loans. The principal amounts of the notes were between $40 thousand and $120 thousand, and such notes bore interest at 8% per annum and were due between February 12, 2021 and March 23, 2021. As of December 31, 2020, $0.16 million was outstanding under these notes. |
Shareholders_ Equity (Details)
Shareholders’ Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 10, 2021 | Dec. 09, 2020 | Jan. 27, 2021 | Jan. 26, 2021 | Jan. 31, 2020 | Mar. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Shareholders’ Equity (Details) [Line Items] | ||||||||
Preferred stock, shares authorized | 100,000,000 | 100,000,000 | ||||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | ||||||
Common stock, shares outstanding | 72,533,850 | |||||||
Additional purchase of securities, description | In addition, pursuant to the Second Offering Underwriting Agreement, the Company granted the Representative a 45-day option to purchase up to 847,058 additional shares of common stock to cover over-allotments in connection with the Second Offering, which the Representative exercised in full on February 11, 2021. | the Company granted the Representative a 45-day option to purchase up to 578,312 additional shares of common stock, and/or 578,312 additional First Offering Warrants, to cover over-allotments in connection with the First Offering, which the Representative partially exercised to purchase 578,312 Warrants on the First Offering Closing Date. For additional information on these First Offering Warrants, see Note 16 – Share-Based Compensation. | ||||||
Gross proceeds received (in Dollars) | $ 27,600 | $ 1,370 | ||||||
Gross proceeds deduction, percentage | 8.00% | 8.00% | 8.00% | |||||
Representative warrants to purchase of shares of common stock | 225,882 | 154,216 | ||||||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | ||||||
Warrants to purchase shares of common stock | 198,776 | |||||||
Description of consulting agreement | the Company entered into an agreement with a consultant to replace an existing consulting agreement between the consultant and the Company to allow the consultant to elect to take from 50% to 100% of its compensation in the form of common stock based on an agreed upon conversion calculation. Any difference between the amount due and the actual fair value of the shares issued in payment is recorded as general and administrative expense in the Company’s Condensed Consolidated Financial Statements. Common stock to be issued to the consultant will be paid on a quarterly basis. During the nine months ended September 30, 2021 and 2020, respectively, the Company issued 15,740 shares of its common stock with a fair value of $69 thousand and 55,032 shares of its common stock, with a fair value of $193 thousand to the consultant for services previously rendered. | |||||||
Consultant payment of common stock | 5,000 | |||||||
Fair value of amount (in Dollars) | $ 31 | |||||||
Common stock of vested | 2,125 | |||||||
Common stock of expense (in Dollars) | $ 13 | |||||||
Remaining shares of vested | 2,875 | |||||||
Additional recognized expense (in Dollars) | $ 18 | |||||||
Vendor [Member] | ||||||||
Shareholders’ Equity (Details) [Line Items] | ||||||||
Common stock, par value (in Dollars per share) | $ 4.15 | |||||||
Warrants [Member] | ||||||||
Shareholders’ Equity (Details) [Line Items] | ||||||||
Warrants issued | 100,000 | |||||||
First Offering [Member] | ||||||||
Shareholders’ Equity (Details) [Line Items] | ||||||||
Sale of aggregate units of shares | 3,855,422 | |||||||
Public price per share (in Dollars per share) | $ 4.15 | |||||||
Common stock exercise price (in Dollars per share) | $ 4.5 | |||||||
Gross proceeds received (in Dollars) | $ 16,000 | |||||||
Purchase of additional shares of common stock | 329,815 | |||||||
Sale of common stock, percentage | 4.00% | |||||||
Total expenses of public offering (in Dollars) | $ 2,700 | |||||||
Second Offering [Member] | ||||||||
Shareholders’ Equity (Details) [Line Items] | ||||||||
Sale of aggregate units of shares | 5,647,059 | |||||||
Sale of common stock, percentage | 4.00% | |||||||
Total expenses of public offering (in Dollars) | $ 2,600 | |||||||
Sale of stock, price per unit (in Dollars per share) | $ 4.25 | |||||||
Private Placement [Member] | ||||||||
Shareholders’ Equity (Details) [Line Items] | ||||||||
Warrants to purchase shares of common stock | 27,106 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | May 05, 2021 | Apr. 02, 2021 | Feb. 12, 2021 | Dec. 02, 2019 | Aug. 25, 2021 | Jun. 29, 2021 | Jun. 25, 2021 | May 27, 2021 | Jan. 26, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 |
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Common stock authorized awards to granted (in Shares) | 3,333,334 | 3,333,334 | ||||||||||
Number of shares (in Shares) | 1,315,789 | 8,333,334 | 1,820,000 | |||||||||
Number of shares issued (in Shares) | 5,430,505 | |||||||||||
Number of shares forfeited (in Shares) | 33,334 | |||||||||||
Exercised shares (in Shares) | 63,333 | |||||||||||
Number of common shares authorized (in Shares) | 2,936,163 | |||||||||||
Expiration date | May 27, 2026 | May 1, 2030 | ||||||||||
Aggregate of restricted stock (in Shares) | 633,336 | |||||||||||
Fair value of per share | $ 2.46 | $ 0.859 | $ 0.873 | $ 0.505 | ||||||||
Restricted stock units, description | The original vesting period for these RSAs is as follows: 283,339 were to vest on the one-year anniversary of the grant date; 283,331 were to vest on the two-year anniversary of the original grant date; and 66,666 were scheduled to vest on the three-year anniversary of the original grant date. As of December 31, 2020, 283,339 RSAs had vested. In the first quarter of fiscal 2021, the Company modified the RSA awards for two individuals to accelerate the final vesting of their awards in consideration of the individuals’ separation and/or retirement. This modification resulted in the vesting of an additional 50,000 RSAs. An incremental compensation expense was recognized for the modification totaling $0.17 million during the nine months ended September 30, 2021. As of September 30, 2021, the remaining unvested RSAs from these awards, totaling 299,997, are scheduled to vest as follows: 233,331 are scheduled to vest on the two-year anniversary of the original grant date; and 66,666 were scheduled to vest on the three-year anniversary of the original grant date. | |||||||||||
Fair value of per share | $ 4.5 | |||||||||||
Vesting period, description | The vesting period for these RSAs is as follows: 33,334 vest on the one-year anniversary of the grant date and 33,333 vest on the two-year anniversary of the original grant date. | |||||||||||
Vested percentage | 100.00% | 100.00% | ||||||||||
Recognized of compensation expense (in Dollars) | $ 180 | $ 710 | ||||||||||
Unrecognized compensation cost (in Dollars) | 460 | |||||||||||
Aggregate of purchase shares (in Shares) | 2,458,163 | |||||||||||
Exercise price | $ 2.75 | $ 2.75 | $ 3 | $ 4.5 | ||||||||
Aggregate of shares common stock (in Shares) | 295,000 | 2,680,048 | ||||||||||
Service period description | Of these, options to purchase 2,700,000 shares have a one year service period and vest ratably on the six month and twelve month anniversary of their authorization for issuance and options to purchase 25,000 shares vested immediately upon grant. | Of these, options to purchase 753,837 shares have a three year service period and vest ratably on the first, second and third anniversary of their authorization for issuance and options to purchase 1,025,000 shares have a two-year service period and vest ratably on the first and second anniversary of their authorization for issuance. | ||||||||||
Share-based compensation expense (in Dollars) | $ 470 | 820 | $ 5 | |||||||||
Unrecognized compensation expense (in Dollars) | $ 3,480 | $ 25 | ||||||||||
Weighted average grant date fair value per share | $ 1.328 | |||||||||||
Minimum [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Fair value of per share | $ 0.961 | 0.759 | ||||||||||
Exercise price | 2.75 | |||||||||||
Maximum [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Fair value of per share | 1.042 | $ 0.768 | ||||||||||
Exercise price | $ 3.025 | |||||||||||
Warrant [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Expiration date | Jan. 26, 2026 | |||||||||||
Aggregate of shares common stock (in Shares) | 2,751,556 | |||||||||||
Exercise per share price | $ 4.5 | |||||||||||
Estimated per share | 1.597 | |||||||||||
Warrant One [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Exercise price | $ 4.5 | |||||||||||
Warrant to purchase (in Shares) | 4,433,734 | |||||||||||
Warrants price per share | $ 1.597 | |||||||||||
Warrants Two [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Expiration date | Feb. 10, 2026 | |||||||||||
Exercise per share price | $ 5.3125 | |||||||||||
Estimated per share | $ 1.918 | |||||||||||
Aggregate of purchase shares (in Shares) | 225,882 | |||||||||||
Stock Options [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Number of shares (in Shares) | 655,002 | |||||||||||
Expiration date | Dec. 15, 2021 | |||||||||||
Recognized of compensation expense (in Dollars) | $ 130 | |||||||||||
First Offering Warrants [Member] | Warrant One [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Exercise price | $ 4.15 | |||||||||||
Warrant to purchase (in Shares) | 100,000 | |||||||||||
Warrants price per share | $ 1.703 | |||||||||||
Board of Directors [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Aggregate of restricted stock (in Shares) | 66,667 | |||||||||||
Common Stock [Member] | Warrant One [Member] | ||||||||||||
Share-Based Compensation (Details) [Line Items] | ||||||||||||
Exercise price | $ 5.1875 | |||||||||||
Warrant to purchase (in Shares) | 154,216 | |||||||||||
Warrants price per share | $ 1.376 |
Share-Based Compensation (Det_2
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted | 9 Months Ended |
Sep. 30, 2021 | |
Option [Member] | |
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted [Line Items] | |
Expected dividend yield | 0.00% |
Minimum [Member] | Option [Member] | |
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted [Line Items] | |
Expected volatility | 46.50% |
Risk-free interest rate | 0.48% |
Expected life of options | 3 years |
Maximum [Member] | Option [Member] | |
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted [Line Items] | |
Expected volatility | 53.02% |
Risk-free interest rate | 0.89% |
Expected life of options | 5 years |
Warrant [Member] | |
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted [Line Items] | |
Expected dividend yield | 0.00% |
Contractual life of warrants | 5 years |
Warrant [Member] | Minimum [Member] | |
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted [Line Items] | |
Expected volatility | 39.94% |
Risk-free interest rate | 0.42% |
Warrant [Member] | Maximum [Member] | |
Share-Based Compensation (Details) - Schedule of assumptions used to estimate fair value stock options granted [Line Items] | |
Expected volatility | 46.22% |
Risk-free interest rate | 0.84% |
Share-Based Compensation (Det_3
Share-Based Compensation (Details) - Schedule of stock option activity - Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Share-Based Compensation (Details) - Schedule of stock option activity [Line Items] | ||
Number of Options, Outstanding Beginning balance | 3,433,515 | 2,898,347 |
Weighted- Average Exercise Price per Share, Outstanding Beginning balance | 1.59 | 1.9 |
Weighted- Average Contractual Life in Years, Outstanding Beginning balance | 2 years 3 days | 1 year 11 months 1 day |
Aggregate Intrinsic Value, Outstanding Beginning balance (in Dollars) | $ 15,221 | $ 2,265 |
Number of Options, Exercisable Beginning balance | 3,400,181 | 2,898,347 |
Weighted- Average Exercise Price per Share, Exercisable Beginning balance (in Dollars per share) | $ 1.58 | $ 1.9 |
Weighted- Average Contractual Life in Years, Exercisable Beginning balance | 1 year 11 months 26 days | 1 year 11 months 1 day |
Aggregate Intrinsic Value, Exercisable Beginning balance (in Dollars) | $ 15,129 | $ 2,265 |
Number of Options, Granted | 4,532,000 | 908,505 |
Weighted- Average Exercise Price per Share, Granted (in Dollars per share) | $ 2.76 | $ 0.77 |
Weighted- Average Contractual Life in Years, Granted | 4 years 6 months 3 days | 4 years 7 months 2 days |
Aggregate Intrinsic Value, Granted (in Dollars) | $ 5,838 | |
Number of Options, Exercised | (63,333) | |
Weighted- Average Exercise Price per Share, Exercised (in Dollars per share) | $ 0.26 | |
Weighted- Average Contractual Life in Years, Exercised | 3 years 9 months 7 days | |
Aggregate Intrinsic Value, Exercised (in Dollars) | $ 85 | |
Number of Options, Cancelled or Expired | (856,669) | (333,335) |
Weighted- Average Exercise Price per Share, Cancelled or Expired (in Dollars per share) | $ 1.78 | $ 2.01 |
Weighted- Average Contractual Life in Years, Cancelled or Expired | 2 months 4 days | 7 months 2 days |
Aggregate Intrinsic Value, Cancelled or Expired (in Dollars) | $ 91 | $ 1,903 |
Number of Options, Outstanding Ending balance | 7,045,513 | 3,440,183 |
Weighted- Average Exercise Price per Share, Outstanding Ending balance (in Dollars per share) | $ 2.33 | $ 1.59 |
Weighted- Average Contractual Life in Years, Outstanding Ending balance | 3 years 6 months 3 days | 2 years 3 months 3 days |
Aggregate Intrinsic Value, Outstanding Ending balance (in Dollars) | $ 830 | $ 19,339 |
Number of Options, Exercisable Ending balance | 2,513,513 | 3,406,849 |
Weighted- Average Exercise Price per Share, Exercisable Ending balance (in Dollars per share) | $ 1.56 | $ 1.58 |
Weighted- Average Contractual Life in Years, Exercisable Ending balance | 1 year 8 months 12 days | 2 years 2 months 26 days |
Aggregate Intrinsic Value, Exercisable Ending balance (in Dollars) | $ 830 | $ 19,207 |
Share-Based Compensation (Det_4
Share-Based Compensation (Details) - Schedule of stock option activity - Warrant [Member] - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Share-Based Compensation (Details) - Schedule of stock option activity [Line Items] | ||
Number of Warrants, Outstanding Beginning balance | 890,416 | 167,846 |
Weighted- Average Exercise Price, Outstanding Beginning balance | $ 1.46 | $ 2.85 |
Weighted- Average Remaining Contractual Life in Years, Outstanding Beginning balance | 4 years 7 days | 1 year 11 months 15 days |
Aggregate Intrinsic Value, Outstanding Beginning balance | $ 4,083 | $ 258 |
Number of Warrants, Exercisable Beginning balance | 890,416 | 167,846 |
Weighted- Average Exercise Price, Exercisable Beginning balance | $ 1.46 | $ 2.85 |
Weighted- Average Remaining Contractual Life in Years, Exercisable Beginning balance | 4 years 7 days | 1 year 11 months 15 days |
Aggregate Intrinsic Value, Exercisable Beginning balance | $ 4,083 | $ 258 |
Number of Warrants, Granted/Issued | 10,804,881 | 858,985 |
Weighted- Average Exercise Price, Granted/Issued | $ 4.09 | $ 1.39 |
Weighted- Average Remaining Contractual Life in Years, Granted/Issued | 4 years 5 months 12 days | 4 years 5 months 4 days |
Aggregate Intrinsic Value, Granted/Issued | $ 5,016 | |
Number of Warrants, Exercised | (94,510) | |
Weighted- Average Exercise Price, Exercised | $ 0.03 | |
Weighted- Average Remaining Contractual Life in Years, Exercised | 1 year 3 months | |
Aggregate Intrinsic Value, Exercised | $ 678 | |
Number of Warrants, Forfeited or Expired | (13,706) | |
Weighted- Average Exercise Price, Forfeited or Expired | $ 1.9 | |
Weighted- Average Remaining Contractual Life in Years, Forfeited or Expired | 10 months 6 days | |
Aggregate Intrinsic Value, Forfeited or Expired | $ 1 | |
Number of Warrants, Outstanding Ending balance | 11,681,591 | 932,321 |
Weighted- Average Exercise Price, Outstanding Ending balance | $ 3.89 | $ 1.79 |
Weighted- Average Remaining Contractual Life in Years, Outstanding Ending balance | 4 years 4 months 13 days | 4 years 2 months 1 day |
Aggregate Intrinsic Value, Outstanding Ending balance | $ 679 | $ 5,251 |
Number of Warrants, Exercisable Ending balance | 11,681,591 | 932,321 |
Weighted- Average Exercise Price, Exercisable Ending balance | $ 3.89 | $ 1.79 |
Weighted- Average Remaining Contractual Life in Years, Exercisable Ending balance | 4 years 4 months 13 days | 4 years 2 months 1 day |
Aggregate Intrinsic Value, Exercisable Ending balance | $ 679 | $ 5,251 |
Concentration (Details)
Concentration (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
Trade accounts receivable | 97.00% |
Revenue, percentage | 10.00% |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | |
Oct. 29, 2021 | Oct. 04, 2021 | |
Subsequent Events (Details) [Line Items] | ||
Total consideration | $ 13,600 | |
Aggregate of shares (in Shares) | 320,000 | |
Public offering price, per share (in Dollars per share) | $ 25 | |
Gross proceeds | $ 7,200 | |
Underwriting discounts and commissions percentage | 8.00% | |
Net proceeds | $ 2,750 | |
Series A Cumulative Redeemable Perpetual Preferred Stock [Member] | ||
Subsequent Events (Details) [Line Items] | ||
Interest rate | 9.25% | |
Preferred Series A [Member] | ||
Subsequent Events (Details) [Line Items] | ||
Preferred stock, par value (in Dollars per share) | $ 0.0001 | |
Additional shares of preferred stock (in Shares) | 48,000 | |
Gross proceeds | $ 900 |