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PFIE Profire Energy

Cover Page

Cover Page - shares3 Months Ended
Mar. 31, 2021May 03, 2021
Cover [Abstract]
Document Type10-Q
Document Quarterly Reporttrue
Document Period End DateMar. 31,
2021
Document Transition Reportfalse
Entity File Number001-36378
Entity Registrant NamePROFIRE ENERGY, INC.
Entity Incorporation, State or Country CodeNV
Entity Tax Identification Number20-0019425
Entity Address, Address Line One321 South 1250 West, Suite 1
Entity Address, City or TownLindon
Entity Address, State or ProvinceUT
Entity Address, Postal Zip Code84042
City Area Code801
Local Phone Number796-5127
Entity Current Reporting StatusYes
Entity Interactive Data CurrentYes
Entity Filer CategoryNon-accelerated Filer
Entity Small Businesstrue
Entity Emerging Growth Companyfalse
Entity Shell Companyfalse
Title of 12(b) SecurityCommon, $0.001 Par Value
Trading SymbolPFIE
Security Exchange NameNASDAQ
Entity Common Stock, Shares Outstanding (in shares)48,021,696
Amendment Flagfalse
Entity Central Index Key0001289636
Current Fiscal Year End Date--12-31
Document Fiscal Year Focus2021
Document Fiscal Period FocusQ1

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)Mar. 31, 2021Dec. 31, 2020
CURRENT ASSETS
Cash and cash equivalents $ 10,475,429 $ 9,148,312
Short-term investments2,293,992 2,388,601
Accounts receivable, net2,772,162 3,719,508
Inventories, net (note 3)8,104,532 8,414,772
Prepaid expenses and other current assets (note 4)823,901 1,678,428
Income tax receivable580,751 486,154
Total Current Assets25,050,767 25,835,775
LONG-TERM ASSETS
Long-term investments6,589,247 6,064,294
Financing right-of-use asset38,969 50,094
Property and equipment, net11,926,464 12,021,811
Intangible assets, net1,716,187 1,771,870
Goodwill2,579,381 2,579,381
Total Long-Term Assets22,850,248 22,487,450
TOTAL ASSETS47,901,015 48,323,225
CURRENT LIABILITIES
Accounts payable975,755 1,178,979
Accrued liabilities (note 5)1,361,404 1,196,870
Current financing lease liability (note 6)36,408 39,451
Total Current Liabilities2,373,567 2,415,300
LONG-TERM LIABILITIES
Net deferred income tax liability522,163 522,870
Long-term financing lease liability (note 6)4,353 12,669
TOTAL LIABILITIES2,900,083 2,950,839
STOCKHOLDERS' EQUITY (note 7)
Preferred stock: $0.001 par value, 10,000,000 shares authorized: no shares issued or outstanding0 0
Common stock: $0.001 par value, 100,000,000 shares authorized: 51,434,074 issued and 48,021,696 outstanding at March 31, 2021, and 51,384,961 issued and 47,972,583 outstanding at December 31, 202051,434 51,385
Treasury stock, at cost(5,353,019)(5,353,019)
Additional paid-in capital30,391,837 30,293,472
Accumulated other comprehensive loss(2,017,292)(2,148,924)
Retained earnings21,927,972 22,529,472
TOTAL STOCKHOLDERS' EQUITY45,000,932 45,372,386
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 47,901,015 $ 48,323,225

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / sharesMar. 31, 2021Dec. 31, 2020
Stock Transactions, Parenthetical Disclosures [Abstract]
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, shares authorized (in shares)10,000,000 10,000,000
Preferred stock, shares issued (in shares)0 0
Preferred stock, shares outstanding (in shares)0 0
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized (in shares)100,000,000 100,000,000
Common stock, shares issued (in shares)51,434,074 51,384,961
Common stock, shares outstanding (in shares)48,021,696 47,972,583

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020
REVENUES (note 8)
Total Revenues $ 5,092,349 $ 7,447,142
COST OF SALES
Total Cost of Goods Sold2,917,662 4,282,466
GROSS PROFIT2,174,687 3,164,676
OPERATING EXPENSES
General and administrative expenses2,554,536 3,272,538
Research and development256,891 409,726
Depreciation and amortization expense167,485 147,472
Total Operating Expenses2,978,912 3,829,736
LOSS FROM OPERATIONS(804,225)(665,060)
OTHER INCOME (EXPENSE)
Gain on sale of fixed assets73,901 0
Other income (expense)(97)347
Interest income21,062 74,393
Total Other Income94,866 74,740
LOSS BEFORE INCOME TAXES(709,359)(590,320)
INCOME TAX BENEFIT107,859 225,056
NET LOSS(601,500)(365,264)
OTHER COMPREHENSIVE INCOME (LOSS)
Foreign currency translation gain (loss)139,606 (945,423)
Unrealized losses on investments(7,974)(157,354)
Total Other Comprehensive Income (Loss)131,632 (1,102,777)
COMPREHENSIVE LOSS $ (469,868) $ (1,468,041)
BASIC LOSS PER SHARE (in dollars per share) $ (0.01) $ (0.01)
FULLY DILUTED LOSS PER SHARE (in dollars per share) $ (0.01) $ (0.01)
BASIC WEIGHTED AVG NUMBER OF SHARES OUTSTANDING (in shares)47,990,101 47,492,441
FULLY DILUTED WEIGHTED AVG NUMBER OF SHARES OUTSTANDING (in shares)47,990,101 47,492,441
Product
REVENUES (note 8)
Total Revenues $ 4,657,535 $ 6,860,958
COST OF SALES
Total Cost of Goods Sold2,537,634 3,833,682
Service
REVENUES (note 8)
Total Revenues434,814 586,184
COST OF SALES
Total Cost of Goods Sold $ 380,028 $ 448,784

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($)TotalCommon StockAdditional Paid-In CapitalAccumulated Other Comprehensive Income (Loss)Treasury StockRetained Earnings
Balance, beginning of period (in shares) at Dec. 31, 201947,411,977
Balance, beginning of period at Dec. 31, 2019 $ 46,571,586 $ 50,824 $ 29,584,172 $ (2,415,460) $ (5,353,019) $ 24,705,069
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation66,348 66,348
Stock issued in exercise of stock options (in shares)2,000
Stock issued in exercise of stock options2,020 $ 2 2,018
Stock issued in settlement of RSUs (in shares)271,684
Stock issued in settlement of RSUs419,373 $ 272 419,101
Tax withholdings paid related to stock based compensation(148,879)(148,879)
Foreign currency translation(945,423)(945,423)
Unrealized gains (losses) on investments(157,354)(157,354)
Net loss(365,264)(365,264)
Balance, end of period (in shares) at Mar. 31, 202047,685,661
Balance, end of period at Mar. 31, 202045,442,407 $ 51,098 29,922,760 (3,518,237)(5,353,019)24,339,805
Balance, beginning of period (in shares) at Dec. 31, 202047,972,583
Balance, beginning of period at Dec. 31, 202045,372,386 $ 51,385 30,293,472 (2,148,924)(5,353,019)22,529,472
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation125,043 125,043
Stock issued in settlement of RSUs (in shares)49,113
Stock issued in settlement of RSUs0 (49)
Tax withholdings paid related to stock based compensation(26,629)(26,629)
Foreign currency translation139,606 139,606
Unrealized gains (losses) on investments(7,974)(7,974)
Net loss(601,500)(601,500)
Balance, end of period (in shares) at Mar. 31, 202148,021,696
Balance, end of period at Mar. 31, 2021 $ 45,000,932 $ 51,434 $ 30,391,837 $ (2,017,292) $ (5,353,019) $ 21,927,972

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020
OPERATING ACTIVITIES
Net loss $ (601,500) $ (365,264)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization expense293,615 259,801
(Gain) Loss on sale of fixed assets(73,901)0
Bad debt expense(3,084)133,803
Stock awards issued for services125,043 66,348
Changes in operating assets and liabilities:
Accounts receivable974,602 1,314,939
Income taxes receivable/payable(94,597)107,561
Inventories342,980 537,668
Prepaid expenses and other current assets906,459 168,546
Deferred tax asset/liability(707)(114,564)
Accounts payable and accrued liabilities(48,245)(1,837,760)
Net Cash Provided by Operating Activities1,820,665 271,078
INVESTING ACTIVITIES
Proceeds from sale of property and equipment27,784 0
Sale (purchase) of investments(438,830)387,326
Purchase of property and equipment(57,825)(525,384)
Net Cash Used in Investing Activities(468,871)(138,058)
FINANCING ACTIVITIES
Value of equity awards surrendered by employees for tax liability(26,629)(148,879)
Cash received in exercise of stock options0 2,020
Principal paid towards lease liability(11,227)(19,089)
Net Cash Used in Financing Activities(37,856)(165,948)
Effect of exchange rate changes on cash13,179 (95,598)
NET CHANGE IN CASH1,327,117 (128,526)
CASH AT BEGINNING OF PERIOD9,148,312 7,358,856
CASH AT END OF PERIOD10,475,429 7,230,330
CASH PAID FOR:
Interest1,936 872
Income taxes0 0
NON-CASH FINANCING AND INVESTING ACTIVITIES
Common stock issued in settlement of accrued bonuses $ 0 $ 419,373

CONDENSED FINANCIAL STATEMENTS

CONDENSED FINANCIAL STATEMENTS3 Months Ended
Mar. 31, 2021
Condensed Financial Information Disclosure [Abstract]
CONDENSED FINANCIAL STATEMENTSCONDENSED FINANCIAL STATEMENTS Except where the context otherwise requires, all references herein to the "Company," "Profire," "we," "us," "our," or similar words and phrases are to Profire Energy, Inc. and its wholly owned subsidiaries, taken together. The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, stockholders' equity, and cash flows at March 31, 2021 and for all periods presented herein have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the Company's audited financial statements contained in its annual report on Form 10-K for the year ended December 31, 2020 ("Form 10-K"). The results of operations for the three month periods ended March 31, 2021 and 2020 are not necessarily indicative of the operating results for the full years.

ORGANIZATION AND SUMMARY OF SIG

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES3 Months Ended
Mar. 31, 2021
Accounting Policies [Abstract]
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Line of Business This Organization and Summary of Significant Accounting Policies of the Company is presented to assist in understanding the Company's condensed consolidated financial statements. The Company's accounting policies conform to "US GAAP." The Company provides burner-management products, solutions and services for the oil and gas industry primarily in the US and Canadian markets. Significant Accounting Policies There have been no changes to the significant accounting policies of the Company from the information provided in Note 1 of the notes to the consolidated financial statements in the Company's most recent Form 10-K. Recent Accounting Pronouncements The Company has evaluated all recent accounting pronouncements and determined that the adoption of pronouncements applicable to the Company has not had or is not expected to have a material impact on the Company's financial position, results of operations or cash flows.

INVENTORIES

INVENTORIES3 Months Ended
Mar. 31, 2021
Inventory Disclosure [Abstract]
INVENTORIESINVENTORIES Inventories consisted of the following at each balance sheet date: As of March 31, 2021 December 31, 2020 Raw materials $ 362,324 $ 328,772 Finished goods 8,854,546 9,229,298 Work in process — — Subtotal 9,216,870 9,558,070 Reserve for obsolescence (1,112,338) (1,143,298) Total $ 8,104,532 $ 8,414,772

PREPAID EXPENSES AND OTHER CURR

PREPAID EXPENSES AND OTHER CURRENT ASSETS3 Months Ended
Mar. 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
PREPAID EXPENSES AND OTHER CURRENT ASSETSPREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following at each balance sheet date: As of March 31, 2021 December 31, 2020 Assets classified as held for sale $ — $ 623,805 Prepaid inventory 449,358 542,313 Prepaid insurance 148,396 217,465 Interest receivables 66,097 65,984 Vehicle trade-in credits 6,896 55,733 Other 153,154 173,128 Total $ 823,901 $ 1,678,428 In the table above, the assets classified as "held for sale" consisted of an office building located in Spruce Grove, Alberta, Canada. During the three months ended March 31, 2021, we sold the remaining three bays that were part of the office building, which resulted in a gain of $42,378 CAD that was recorded during the period.

ACCRUED LIABILITIES

ACCRUED LIABILITIES3 Months Ended
Mar. 31, 2021
Other Liabilities Disclosure [Abstract]
ACCRUED LIABILITIESACCRUED LIABILITIES Accrued liabilities consisted of the following at each balance sheet date: As of March 31, 2021 December 31, 2020 Employee-related payables $ 1,007,405 $ 789,573 Inventory-related payables 160,972 158,519 Warranty liabilities 43,352 71,852 Other 149,675 176,926 Total $ 1,361,404 $ 1,196,870

LEASES

LEASES3 Months Ended
Mar. 31, 2021
Leases [Abstract]
LEASESLEASES We have leases for office equipment and office space. The leases for office equipment are classified as financing leases and the typical term is 36 months. We have the option to extend most office equipment leases, but we do not intend to do so. Accordingly, no extensions have been recognized in the right-of-use asset or lease liability. The office equipment lease payments are not variable and the lease agreements do not include any non-lease components, residual value guarantees, or restrictions. There are no interest rates implicit in the office equipment lease agreements, so we have used our incremental borrowing rate to determine the discount rate to be applied to our financing leases for purposes of determining our lease liabilities. The weighted average discount rate applied to our financing leases is 4.50% and the weighted average remaining lease term is 12.8 months. The following table shows the components of financing lease cost: For the Three Months Ended March 31, Financing Lease Cost 2021 2020 Amortization of right-of-use assets $ 10,992 $ 18,376 Interest on lease liabilities 1,936 872 Total financing lease cost $ 12,928 $ 19,248 The following table reconciles future minimum lease payments to the discounted finance lease liability: Years ending December 31, Amount 2021 - remaining $ 29,019 2022 12,803 2023 — 2024 — 2025 — Thereafter — Total future minimum lease payments $ 41,822 Less: Amount representing interest 1,061 Present value of future payments $ 40,761 Current portion $ 36,408 Long-term portion $ 4,353 Because our office space leases are substantially all considered to be short-term, we have elected not to recognize them on our balance sheet under the short-term recognition exemption. During the three months ended March 31, 2021 and March 31, 2020, we recognized $16,262 and $19,472, respectively, in short-term lease costs associated with office space leases.

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY3 Months Ended
Mar. 31, 2021
Equity [Abstract]
STOCKHOLDERS' EQUITYSTOCKHOLDERS' EQUITY As of March 31, 2021 and December 31, 2020, the Company held 3,412,378 shares of its common stock in treasury at a total cost of $5,353,019, respectively. As of March 31, 2021, the Company had 222,472 restricted stock units, 182,278 performance based restricted stock units, and 934,700 stock options outstanding with $428,931 in remaining compensation expense to be recognized over the next 2.0 years. 2020 EIP and LTIP Due to economic uncertainties including those caused by the COVID-19 pandemic, the Board of Directors of the Company, with the support of the Company's executives, elected not to adopt an executive incentive plan ("2020 EIP") or long-term incentive plan ("2020 LTIP") for 2020. The Board and executives believed this was an appropriate short-term measure that helped align the Company's cost structure with the extraordinary conditions affecting the industry in which we operate. 2021 RSUs On February 18, 2021, the Board of Directors, upon the recommendation of the Compensation Committee of the Board (the "Compensation Committee"), approved a restricted stock award of 18,852 shares of common stock to each of Cameron M. Tidball and Ryan W. Oviatt. Messrs. Tidball and Oviatt entered into Restricted Stock Award Agreements, the forms of which were approved pursuant to the Company's 2014 Equity Incentive Plan. These restricted stock awards, which vested immediately, were settled by the issuance of a total of 27,334 shares of common stock, net of tax withholding and resulted in $45,999 of compensation expense. 2020 RSUs On June 17, 2020, pursuant to the annual renewal of director compensation, the Board approved a grant of 270,966 RSUs to the independent directors of the Board. Half of the RSUs vested immediately on the date of grant and the remaining 50% of the RSUs will vest on the first anniversary of the grant date or at the Company's next annual meeting of stockholders, whichever is earlier. The awards will result in total compensation expense of $252,000 to be recognized over the vesting period. Mr. Arlen B. Crouch resigned from his position as a member of the Board, effective August 3, 2020. Mr. Crouch’s resignation did not result from any disagreements with management or the Board. On the effective date of Mr. Crouch's resignation, all of his unvested RSUs were forfeited. The related compensation expense associated with Mr. Crouch's unvested RSUs will be recaptured. On July 30, 2020, the Board appointed Colleen Larkin Bell to serve as a director to fill the vacancy resulting from Mr. Crouch’s resignation, effective August 3, 2020. Ms. Bell was also appointed as Chair of the Nominating Committee and as a member of the Audit and Compensation Committees. As part of her compensation for her service as a director and committee member, on August 21, 2020, the board approved a grant of 92,934 RSUs. Half of the RSUs vested immediately on the date of the grant and the remaining 50% of the RSUs will vest on the first anniversary of the grant date. The awards will result in total compensation expense of $72,953 to be recognized over the vesting period. 2020 Stock Options On March 17, 2020, (the "March Grant Date"), the Board approved a grant of options to purchase 115,200 shares of the Company's common stock at a strike price of $0.81 to various employees (the "March 2020 Options"). The March 2020 Options terminate four years from the March Grant Date and became exercisable as to one-third of the shares of common stock covered thereby on each anniversary of the March Grant Date for the next three years following the March Grant Date. The March 2020 Options resulted in a total compensation expense of $40,280. On July 2, 2020 (the "July Grant Date"), upon the recommendation of the Compensation Committee, the Board approved the grant of a non-qualified stock option to purchase 100,000 shares of the Company’s common stock to each of Mr. Oviatt and Mr. Tidball under the Company’s 2014 Equity Incentive Plan and pursuant to the standard form of Notice of Stock Option Grant and Stock Option Agreement under the plan (the “July 2020 Options”). The exercise price of the July 2020 Options is equal to the closing bid price of the Company's common stock on July 2, 2020 or $0.8439 per share. The July 2020 Options vest equally over a period of three years from the July Grant Date. Vesting occurs on the anniversary date of the July Grant Date, with one-third of the total shares vesting on each of the first three anniversaries of the July Grant Date. Vesting is contingent upon the executive’s continued employment with the Company on each applicable vesting date. The July 2020 Options expire on July 2, 2024. The July 2020 Options will result in a total compensation expense of $79,431 to be recognized over the vesting period. On August 21, 2020 (the "August Grant Date"), the Board approved a grant of options to purchase 630,000 shares of the Company's common stock at a strike price of $0.785 to various employees (the "August 2020 Options"). The August 2020 Options terminate four years from the August Grant Date and become exercisable as to one-third of the shares of common stock covered thereby on each anniversary of the August Grant Date for the next three years following the August Grant Date. The August 2020 Options will result in a total compensation expense of $233,111 to be recognized over the vesting period.

REVENUE

REVENUE3 Months Ended
Mar. 31, 2021
Revenue from Contract with Customer [Abstract]
REVENUEREVENUE Performance Obligations Our performance obligations include providing product and servicing our product. We recognize product revenue performance obligations in most cases when the product is delivered to the customer. Occasionally, if we are shipping the product on a customer’s account, we recognize revenue when the product has been shipped. At that point in time, the control of the product is transferred to the customer. When we perform service work, we apply the practical expedient that allows us to recognize service revenue when we have the right to invoice the customer for the work completed. We do not engage in transactions acting as an agent. The time needed to complete our performance obligations varies based on the size of the project; however, we typically satisfy our performance obligations within a few months of entering into the applicable sales contract or service contract. Our customers have the right to return certain unused and unopened products within 90 days for a restocking fee. We provide a warranty on some of our products ranging from 90 days to 2 years, depending on the product. See note 5 for the amount accrued for expected returns and warranty claims as of March 31, 2021. Contract Balances We have elected to use the practical expedient in ASC 340-40-25-4 (regarding recognition of the incremental costs of obtaining a contract) for costs related to contracts that are estimated to be completed within one year. All of our current sales contracts and service contracts are expected to be completed within one year, and as a result, we have not recognized a contract asset account. If we had chosen not to use this practical expedient, we would not expect a material difference in the contract balances. We also did not have any material contract liabilities because we typically do not receive payments in advance of recognizing revenue. Disaggregation of Revenue All revenue recognized in the income statement is considered to be revenue from contracts with customers. The table below shows revenue by category: For the Three Months Ended March 31, 2021 2020 Electronics $ 1,851,799 $ 2,657,087 Manufactured 236,810 400,858 Re-Sell 2,568,926 3,803,013 Service 434,814 586,184 Total Revenue $ 5,092,349 $ 7,447,142

BASIC AND DILUTED EARNINGS PER

BASIC AND DILUTED EARNINGS PER SHARE3 Months Ended
Mar. 31, 2021
Earnings Per Share [Abstract]
BASIC AND DILUTED EARNINGS PER SHAREBASIC AND DILUTED EARNINGS PER SHARE The following table is a reconciliation of the numerator and denominators used in the earnings per share calculation: For the Three Months Ended March 31, 2021 2020 Income (loss) (Numerator) Weighted Average Shares (Denominator) Per-Share Income (Numerator) Weighted Average Shares (Denominator) Per-Share Basic EPS Net income (loss) available to common stockholders $ (601,500) 47,990,101 $ (0.01) $ (365,264) 47,492,441 $ (0.01) Effect of Dilutive Securities Stock options & RSUs — — — — Diluted EPS Net income (loss) available to common stockholders + assumed conversions $ (601,500) 47,990,101 $ (0.01) $ (365,264) 47,492,441 $ (0.01) Stock options and RSUs to purchase 1,339,450 shares of common stock at a weighted average price of $1.15 per share were outstanding during the three months ended March 31, 2021, but were not included in the computation of diluted EPS because the impact of these shares would be antidilutive. These RSUs, which expire between April 2021 and August 2024, were still outstanding at March 31, 2021. Stock options and RSUs to purchase 784,769 shares of common stock at a weighted average price of $1.28 per share were outstanding during the three months ended March 31, 2020, but were not included in the computation of diluted EPS because the impact of these shares would be antidilutive. These options, which expired between May 2020 and March 2024, were still outstanding at March 31, 2020.

SEGMENT INFORMATION

SEGMENT INFORMATION3 Months Ended
Mar. 31, 2021
Segment Reporting [Abstract]
SEGMENT INFORMATIONSEGMENT INFORMATION The Company operates in the United States and Canada. Segment information for these geographic areas is as follows: For the Three Months Ended March 31, Sales 2021 2020 Canada $ 828,445 $ 1,023,722 United States 4,263,904 6,423,420 Total Consolidated $ 5,092,349 $ 7,447,142 For the Three Months Ended March 31, Profit (Loss) 2021 2020 Canada $ (320,762) $ (322,069) United States (280,738) (43,195) Total Consolidated $ (601,500) $ (365,264) As of Long-Lived Assets March 31, 2021 December 31, 2020 Canada $ 6,053,391 $ 6,049,790 United States 5,912,042 6,022,115 Total Consolidated $ 11,965,433 $ 12,071,905

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS3 Months Ended
Mar. 31, 2021
Subsequent Events [Abstract]
SUBSEQUENT EVENTSSUBSEQUENT EVENTSOn April 30, 2021 the Company entered into amendments to employment agreements with each of Mr. Brenton W. Hatch, the Company's Executive Chairman; Mr. Ryan W. Oviatt, the Company's Co-CEO, CFO, and Co-President; Mr. Cameron M. Tidball, the Company's Co-CEO and Co-President; Mr. Jay G. Fugal, the Company's VP of Operations; and Mr. Patrick D. Fisher the Company's VP of Product Development. The amendments to the employment agreements and the Company's financial obligation related thereto are described in Item 5 of Part II on Page 18 of this report.

ORGANIZATION AND SUMMARY OF S_2

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)3 Months Ended
Mar. 31, 2021
Accounting Policies [Abstract]
Recent Accounting PronouncementsRecent Accounting Pronouncements The Company has evaluated all recent accounting pronouncements and determined that the adoption of pronouncements applicable to the Company has not had or is not expected to have a material impact on the Company's financial position, results of operations or cash flows.
RevenuePerformance Obligations Our performance obligations include providing product and servicing our product. We recognize product revenue performance obligations in most cases when the product is delivered to the customer. Occasionally, if we are shipping the product on a customer’s account, we recognize revenue when the product has been shipped. At that point in time, the control of the product is transferred to the customer. When we perform service work, we apply the practical expedient that allows us to recognize service revenue when we have the right to invoice the customer for the work completed. We do not engage in transactions acting as an agent. The time needed to complete our performance obligations varies based on the size of the project; however, we typically satisfy our performance obligations within a few months of entering into the applicable sales contract or service contract. Our customers have the right to return certain unused and unopened products within 90 days for a restocking fee. We provide a warranty on some of our products ranging from 90 days to 2 years, depending on the product. See note 5 for the amount accrued for expected returns and warranty claims as of March 31, 2021. Contract Balances We have elected to use the practical expedient in ASC 340-40-25-4 (regarding recognition of the incremental costs of obtaining a contract) for costs related to contracts that are estimated to be completed within one year. All of our current sales contracts and service contracts are expected to be completed within one year, and as a result, we have not recognized a contract asset account. If we had chosen not to use this practical expedient, we would not expect a material difference in the

INVENTORIES (Tables)

INVENTORIES (Tables)3 Months Ended
Mar. 31, 2021
Inventory Disclosure [Abstract]
Schedule of InventoryInventories consisted of the following at each balance sheet date: As of March 31, 2021 December 31, 2020 Raw materials $ 362,324 $ 328,772 Finished goods 8,854,546 9,229,298 Work in process — — Subtotal 9,216,870 9,558,070 Reserve for obsolescence (1,112,338) (1,143,298) Total $ 8,104,532 $ 8,414,772

PREPAID EXPENSES AND OTHER CU_2

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)3 Months Ended
Mar. 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Schedule of Other Current AssetsPrepaid expenses and other current assets consisted of the following at each balance sheet date: As of March 31, 2021 December 31, 2020 Assets classified as held for sale $ — $ 623,805 Prepaid inventory 449,358 542,313 Prepaid insurance 148,396 217,465 Interest receivables 66,097 65,984 Vehicle trade-in credits 6,896 55,733 Other 153,154 173,128 Total $ 823,901 $ 1,678,428

ACCRUED LIABILITIES (Tables)

ACCRUED LIABILITIES (Tables)3 Months Ended
Mar. 31, 2021
Other Liabilities Disclosure [Abstract]
Schedule of Accrued LiabilitiesAccrued liabilities consisted of the following at each balance sheet date: As of March 31, 2021 December 31, 2020 Employee-related payables $ 1,007,405 $ 789,573 Inventory-related payables 160,972 158,519 Warranty liabilities 43,352 71,852 Other 149,675 176,926 Total $ 1,361,404 $ 1,196,870

LEASES (Tables)

LEASES (Tables)3 Months Ended
Mar. 31, 2021
Leases [Abstract]
Components of Financing Lease CostThe following table shows the components of financing lease cost: For the Three Months Ended March 31, Financing Lease Cost 2021 2020 Amortization of right-of-use assets $ 10,992 $ 18,376 Interest on lease liabilities 1,936 872 Total financing lease cost $ 12,928 $ 19,248
Future Minimum Lease Payments to Discounted Finance Lease LiabilityThe following table reconciles future minimum lease payments to the discounted finance lease liability: Years ending December 31, Amount 2021 - remaining $ 29,019 2022 12,803 2023 — 2024 — 2025 — Thereafter — Total future minimum lease payments $ 41,822 Less: Amount representing interest 1,061 Present value of future payments $ 40,761 Current portion $ 36,408 Long-term portion $ 4,353

REVENUE (Tables)

REVENUE (Tables)3 Months Ended
Mar. 31, 2021
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue by Product LineThe table below shows revenue by category: For the Three Months Ended March 31, 2021 2020 Electronics $ 1,851,799 $ 2,657,087 Manufactured 236,810 400,858 Re-Sell 2,568,926 3,803,013 Service 434,814 586,184 Total Revenue $ 5,092,349 $ 7,447,142

BASIC AND DILUTED EARNINGS PE_2

BASIC AND DILUTED EARNINGS PER SHARE (Tables)3 Months Ended
Mar. 31, 2021
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and DilutedThe following table is a reconciliation of the numerator and denominators used in the earnings per share calculation: For the Three Months Ended March 31, 2021 2020 Income (loss) (Numerator) Weighted Average Shares (Denominator) Per-Share Income (Numerator) Weighted Average Shares (Denominator) Per-Share Basic EPS Net income (loss) available to common stockholders $ (601,500) 47,990,101 $ (0.01) $ (365,264) 47,492,441 $ (0.01) Effect of Dilutive Securities Stock options & RSUs — — — — Diluted EPS Net income (loss) available to common stockholders + assumed conversions $ (601,500) 47,990,101 $ (0.01) $ (365,264) 47,492,441 $ (0.01)

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)3 Months Ended
Mar. 31, 2021
Segment Reporting [Abstract]
Schedule of Segment Information for Geographic AreasSegment information for these geographic areas is as follows: For the Three Months Ended March 31, Sales 2021 2020 Canada $ 828,445 $ 1,023,722 United States 4,263,904 6,423,420 Total Consolidated $ 5,092,349 $ 7,447,142 For the Three Months Ended March 31, Profit (Loss) 2021 2020 Canada $ (320,762) $ (322,069) United States (280,738) (43,195) Total Consolidated $ (601,500) $ (365,264) As of Long-Lived Assets March 31, 2021 December 31, 2020 Canada $ 6,053,391 $ 6,049,790 United States 5,912,042 6,022,115 Total Consolidated $ 11,965,433 $ 12,071,905

INVENTORIES (Details)

INVENTORIES (Details) - USD ($)Mar. 31, 2021Dec. 31, 2020
Inventory Disclosure [Abstract]
Raw materials $ 362,324 $ 328,772
Finished goods8,854,546 9,229,298
Work in process0 0
Subtotal9,216,870 9,558,070
Reserve for obsolescence(1,112,338)(1,143,298)
Total $ 8,104,532 $ 8,414,772

PREPAID EXPENSES AND OTHER CU_3

PREPAID EXPENSES AND OTHER CURRENT ASSETS - Schedule of other current assets (Details) - USD ($)Mar. 31, 2021Dec. 31, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Assets classified as held for sale $ 0 $ 623,805
Prepaid inventory449,358 542,313
Prepaid insurance148,396 217,465
Interest receivables66,097 65,984
Vehicle trade-in credits6,896 55,733
Other153,154 173,128
Total $ 823,901 $ 1,678,428

PREPAID EXPENSES AND OTHER CU_4

PREPAID EXPENSES AND OTHER CURRENT ASSETS - Narrative (Details)3 Months Ended
Mar. 31, 2021CAD ($)bay
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Number of office building bays sold | bay3
Gain on sale of office building bays | $ $ 42,378

ACCRUED LIABILITIES - Schedule

ACCRUED LIABILITIES - Schedule of Accrued Liabilities (Details) - USD ($)Mar. 31, 2021Dec. 31, 2020
Other Liabilities Disclosure [Abstract]
Employee-related payables $ 1,007,405 $ 789,573
Inventory-related payables160,972 158,519
Warranty liabilities43,352 71,852
Other149,675 176,926
Total $ 1,361,404 $ 1,196,870

LEASES - Narrative (Details)

LEASES - Narrative (Details) - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020
Leases [Abstract]
Lease term36 months
Weighted average discount rate4.50%
Weighted average remaining lease term12 months 24 days
Short-term lease cost $ 16,262 $ 19,472

LEASES - Components of Financin

LEASES - Components of Financing Lease Cost (Details) - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020
Leases [Abstract]
Amortization of right-of-use assets $ 10,992 $ 18,376
Interest on lease liabilities1,936 872
Total financing lease cost $ 12,928 $ 19,248

LEASES - Future Minimum Lease P

LEASES - Future Minimum Lease Payments to Discounted Finance Lease Liability (Details) - USD ($)Mar. 31, 2021Dec. 31, 2020
Years ending December 31,
2021 - remaining $ 29,019
202212,803
20230
20240
20250
Thereafter0
Total future minimum lease payments41,822
Less: Amount representing interest1,061
Present value of future payments40,761
Current portion36,408 $ 39,451
Long-term portion $ 4,353 $ 12,669

STOCKHOLDERS' EQUITY (Details)

STOCKHOLDERS' EQUITY (Details) - USD ($)Feb. 18, 2021Aug. 21, 2020Jul. 02, 2020Jun. 17, 2020Mar. 17, 2020Mar. 31, 2021Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Treasury stock (in shares)3,412,378 3,412,378
Treasury stock, at cost $ 5,353,019 $ 5,353,019
Compensation expense $ 428,931
Compensation expense recognition period2 years
Number of shares approved (in shares)630,000 115,200
Strike price (in dollars per share) $ 0.785 $ 0.81
Tranche One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage33.33%
Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage33.33%
Tranche Three
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage33.33%
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units outstanding (in shares)222,472
Shares issued (in shares)27,334
Compensation expense $ 45,999
Number of shares granted (shares)92,934 270,966
Award vesting percentage50.00%50.00%
Unrecognized compensation cost $ 72,953 $ 252,000
Award vesting period1 year1 year
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units outstanding (in shares)182,278
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options outstanding (in shares)934,700
Compensation expense $ 233,111 $ 79,431 $ 40,280
Award vesting period3 years3 years3 years
Expiration period4 years4 years
Co-Chief Executive Offiver | Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares granted (shares)18,852
Chief Financial Officer | Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares granted (shares)18,852
Vice President of Operations | Tranche One | 2014 EIP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares granted (shares)100,000
Vice President of Operations | Tranche Two | 2014 EIP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares granted (shares)0.8439

REVENUE - Disaggregation of Rev

REVENUE - Disaggregation of Revenue (Details) - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020
Disaggregation of Revenue [Line Items]
Return period90 days
Total Revenues $ 5,092,349 $ 7,447,142
Minimum
Disaggregation of Revenue [Line Items]
Product warranty term90 days
Maximum
Disaggregation of Revenue [Line Items]
Product warranty term2 years
Electronics
Disaggregation of Revenue [Line Items]
Total Revenues $ 1,851,799 2,657,087
Manufactured
Disaggregation of Revenue [Line Items]
Total Revenues236,810 400,858
Re-Sell
Disaggregation of Revenue [Line Items]
Total Revenues2,568,926 3,803,013
Service
Disaggregation of Revenue [Line Items]
Total Revenues $ 434,814 $ 586,184

BASIC AND DILUTED EARNINGS PE_3

BASIC AND DILUTED EARNINGS PER SHARE (Details) - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020
Income (loss) (Numerator)
Net income (loss) available to common stockholders $ (601,500) $ (365,264)
Stock options & RSUs0 0
Net income (loss) available to common stockholders + assumed conversions $ (601,500) $ (365,264)
Weighted Average Shares (Denominator)
Weighted average basic shares outstanding (in shares)47,990,101 47,492,441
Effect of Dilutive Securities, Stock options & RSUs (in shares)0 0
Weighted average diluted shares outstanding (in shares)47,990,101 47,492,441
Per-Share Amount
Basic earnings per share (in dollars per share) $ (0.01) $ (0.01)
Diluted earnings per share (in dollars per share) $ (0.01) $ (0.01)
Antidilutive securities excluded from computation of earnings per share (in shares)1,339,450 784,769
Weighted average (in dollars per share) $ 1.15 $ 1.28

SEGMENT INFORMATION (Details)

SEGMENT INFORMATION (Details) - USD ($)3 Months Ended
Mar. 31, 2021Mar. 31, 2020Dec. 31, 2020
Segment Reporting Information [Line Items]
Sales $ 5,092,349 $ 7,447,142
Profit (Loss)(601,500)(365,264)
Long-Lived Assets11,965,433 $ 12,071,905
Canada
Segment Reporting Information [Line Items]
Sales828,445 1,023,722
Profit (Loss)(320,762)(322,069)
Long-Lived Assets6,053,391 6,049,790
United States
Segment Reporting Information [Line Items]
Sales4,263,904 6,423,420
Profit (Loss)(280,738) $ (43,195)
Long-Lived Assets $ 5,912,042 $ 6,022,115