Document And Entity Information
Document And Entity Information | 3 Months Ended |
Mar. 31, 2023 | |
Document Information Line Items | |
Entity Registrant Name | CUENTAS INC. |
Document Type | S-1 |
Amendment Flag | false |
Entity Central Index Key | 0001424657 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | false |
Entity Incorporation, State or Country Code | FL |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
CURRENT ASSETS: | |||
Cash and cash equivalents | $ 3,328 | $ 466 | $ 6,607 |
Accounts Receivables net of allowance for credit losses | 221 | 209 | 11 |
Related parties | 88 | ||
Other current assets | 52 | 14 | 162 |
Total current assets | 3,689 | 689 | 6,780 |
Property and Equipment, net | 6 | 6 | 2 |
Investment in unconsolidated Entities | 1,468 | 776 | 38 |
Intangible assets | 26 | 28 | 5,438 |
Total assets | 5,189 | 1,499 | 12,258 |
CURRENT LIABILITIES: | |||
Trade payable | 1,224 | 1,231 | 810 |
Other accounts liabilities | 775 | 681 | 1,126 |
Deferred revenue | 109 | 113 | 683 |
Notes and Loan payable | 112 | 109 | 97 |
Stock based liabilities | 1 | 3 | |
Total current liabilities | 2,221 | 2,134 | 2,719 |
Other long-term loans | 89 | 89 | 89 |
TOTAL LIABILITIES | 2,310 | 2,223 | 2,808 |
STOCKHOLDERS’ EQUITY | |||
Common stock, value | 19 | 15 | |
Additional paid in capital | 52,036 | 47,654 | |
Treasury Stock | (33) | (29) | |
Accumulated deficit | (54,445) | (52,750) | (38,219) |
Total stockholders’ equity | 2,879 | (724) | 9,450 |
Total liabilities and stockholders’ equity | 5,189 | 1,499 | 12,258 |
Previously Reported | |||
STOCKHOLDERS’ EQUITY | |||
Common stock, value | 2 | 2 | |
Additional paid in capital | 57,355 | 52,053 | |
Total stockholders’ equity | $ 2,879 | $ (724) | $ 9,450 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | |||
Accounts receivables net of allowance for credit losses (in Dollars) | $ 177 | $ 177 | $ 20 |
Common stock, shares authorized | 360,000,000 | 360,000,000 | 360,000,000 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, shares issued | 2,103,365 | 1,473,645 | 1,157,207 |
Common stock, shares outstanding | 2,103,365 | 1,473,645 | 1,157,207 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||||
REVENUE | $ 64 | $ 394 | $ 2,994 | $ 593 |
COST OF REVENUE | 123 | 260 | 2,508 | 469 |
GROSS PROFIT (LOSS) | (59) | 134 | 486 | 124 |
OPERATING EXPENSES | ||||
Selling, general and administrative | 1,625 | 3,289 | 9,431 | 8,980 |
Impairment of Intangible Assets | 3,600 | |||
Amortization of intangible assets | 2 | 453 | 1,810 | 1,809 |
TOTAL OPERATING EXPENSES | 1,627 | 3,742 | 14,841 | 10,789 |
OPERATING LOSS | (1,686) | (3,608) | (14,355) | (10,665) |
OTHER INCOME (LOSS), NET | ||||
Other income | 1 | (132) | 1 | |
Interest expense | (1) | 6 | (172) | |
Loss from change in fair value of stock-based liabilities | (1) | 2 | 110 | |
TOTAL OTHER EXPENSES | (1) | (124) | (61) | |
NET LOSS BEFORE EQUITY LOSSES | (1,686) | (3,609) | (14,479) | (10,726) |
Equity losses in non-consolidated entity | (9) | (15) | (52) | (2) |
NET LOSS | $ (1,695) | $ (3,624) | $ (14,531) | $ (10,728) |
Net loss per basic and diluted share (in Dollars per share) | $ (1) | $ (3.15) | $ (11.81) | $ (9.32) |
Weighted average number of basic and diluted common shares outstanding (in Shares) | 1,696,022 | 1,151,207 | 1,230,577 | 1,070,541 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) (Parentheticals) - $ / shares | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||||
Diluted net loss per share | $ (1) | $ (3.15) | $ (11.81) | $ (9.32) |
Weighted average number of diluted common shares outstanding | 1,696,022 | 1,151,207 | 1,230,577 | 1,070,541 |
Statements of Changes in Shareh
Statements of Changes in Shareholders’ Equity (Unaudited) - USD ($) $ in Thousands | Previously Reported Common Stock | Previously Reported Additional Paid-in Capital | Previously Reported Treasury Stock | Previously Reported Accumulated Deficit | Previously Reported | Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Total | |||
Balance at Dec. 31, 2020 | $ 11 | $ 28,411 | $ (27,491) | $ 931 | |||||||||
Balance (in Shares) at Dec. 31, 2020 | 814,654 | ||||||||||||
Issuance of Shares of Common Stock, net of issuance expenses | [1] | $ 3 | 10,611 | 10,614 | |||||||||
Issuance of Shares of Common Stock, net of issuance expenses (in Shares) | [1] | 214,669 | |||||||||||
Issuance of Warrants | 4 | 4 | |||||||||||
Shares issued for services and for employees | [2] | 611 | 611 | ||||||||||
Shares issued for services and for employees (in Shares) | 11,026 | ||||||||||||
Share based Compensation | 2,172 | 2,172 | |||||||||||
Shares issued due to exercise of Warrants, net of issuance expenses | [3] | $ 1 | 5,764 | 5,765 | |||||||||
Shares issued due to exercise of Warrants, net of issuance expenses (in Shares) | [3] | 111,881 | |||||||||||
Shares issued due to conversion of Convertible Note | [2] | 81 | 81 | ||||||||||
Shares issued due to conversion of Convertible Note (in Shares) | 2,326 | ||||||||||||
Return of Commitment Shares | [2] | ||||||||||||
Return of Commitment Shares (in Shares) | (3,349) | ||||||||||||
Net income (loss) | (10,728) | (10,728) | |||||||||||
Balance at Dec. 31, 2021 | $ 1 | $ 47,668 | $ (38,219) | $ 9,450 | $ 15 | 47,654 | (38,219) | 9,450 | |||||
Balance (in Shares) at Dec. 31, 2021 | 1,157,207 | 1,151,207 | |||||||||||
Shares issued for services and for employees | 537 | 537 | |||||||||||
Net income (loss) | (3,624) | (3,624) | (3,624) | ||||||||||
Balance at Mar. 31, 2022 | $ 1 | 48,205 | (41,843) | 6,363 | |||||||||
Balance (in Shares) at Mar. 31, 2022 | 1,157,207 | ||||||||||||
Balance at Dec. 31, 2021 | $ 1 | 47,668 | (38,219) | 9,450 | $ 15 | 47,654 | (38,219) | 9,450 | |||||
Balance (in Shares) at Dec. 31, 2021 | 1,157,207 | 1,151,207 | |||||||||||
Issuance of Shares of Common Stock, net of issuance expenses | [4] | $ 4 | 2,685 | 2,689 | |||||||||
Issuance of Shares of Common Stock, net of issuance expenses (in Shares) | [4] | 324,928 | |||||||||||
Shares issued for services | [5] | 110 | 110 | ||||||||||
Shares issued for services (in Shares) | 7,693 | ||||||||||||
Share based Compensation | 1,587 | $ 1,587 | |||||||||||
Issuance of Shares of Common due to acquisition of an asset (in Shares) | 7,693 | ||||||||||||
Treasury stock | [5] | (29) | $ (29) | ||||||||||
Treasury stock (in Shares) | (10,183) | 10,183 | |||||||||||
Net income (loss) | (14,531) | $ (14,531) | |||||||||||
Balance at Dec. 31, 2022 | $ 2 | 52,053 | $ (29) | (52,750) | (724) | $ 19 | $ 52,036 | $ (29) | $ (52,750) | (724) | |||
Balance (in Shares) at Dec. 31, 2022 | 1,473,645 | 1,473,645 | |||||||||||
Issuance of Shares of Common Stock, net of issuance expenses | [6] | [7] | 4,319 | 4,319 | |||||||||
Issuance of Shares of Common Stock, net of issuance expenses (in Shares) | [6] | 291,376 | |||||||||||
Shares issued for services | [7] | 136 | 136 | ||||||||||
Shares issued for services (in Shares) | 27,759 | ||||||||||||
Shares issued due to a settlement | [7] | 120 | 120 | ||||||||||
Shares issued due to a settlement (in Shares) | 15,385 | ||||||||||||
Share based Compensation | 27 | 27 | |||||||||||
Issuance of Shares of Common due to acquisition of an asset | [7] | 700 | 700 | ||||||||||
Issuance of Shares of Common due to acquisition of an asset (in Shares) | 295,282 | ||||||||||||
Treasury stock | (4) | (4) | |||||||||||
Treasury stock (in Shares) | (227) | ||||||||||||
Reverse split | |||||||||||||
Reverse split (in Shares) | 145 | ||||||||||||
Net income (loss) | (1,695) | (1,695) | (1,695) | ||||||||||
Balance at Mar. 31, 2023 | $ 2 | $ 57,355 | $ (33) | $ (54,445) | $ 2,879 | $ 2,879 | |||||||
Balance (in Shares) at Mar. 31, 2023 | 2,103,365 | ||||||||||||
[1] Issuance expenses totaled to $1,386 Less than $1. Issuance expenses totaled to $499 Issuance expenses totaled to $311 Less than $1. Issuance expenses totaled to $681 Less than $1. |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash Flows from Operating Activities: | ||||
Net loss | $ (1,695) | $ (3,624) | $ (14,531) | $ (10,728) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||
Stock based compensation and Shares issued for services | 283 | 537 | 1,697 | 2,745 |
Equity losses in non-consolidated entity | 9 | 15 | 52 | 2 |
Interest | 3 | 3 | ||
Available for sale securities | 3 | |||
Loan to Cuentas SDI LLC that was not repaid | 100 | |||
Credit losses | 157 | |||
Interest expense and Debt discount amortization | 12 | 90 | ||
Gain from Change in on fair value of stock-based liabilities | 1 | (3) | (61) | |
Depreciation and amortization expense | 2 | 453 | 3 | 2 |
Impairment of intangible assets | 3,600 | |||
Amortization of intangible assets | 2 | 453 | 1,810 | 1,809 |
Changes in Operating Assets and Liabilities: | ||||
Accounts receivable | (13) | (81) | (274) | (11) |
Other current assets | (38) | (30) | 148 | (150) |
Accounts payable | (7) | 727 | 421 | (1,544) |
Related Parties, net | (88) | 44 | ||
Other Accounts liabilities | 94 | (137) | 445 | (1,562) |
Deferred revenue | (4) | (88) | (570) | 31 |
Net Cash Used by Operating Activities | (1,453) | (2,225) | (8,137) | (9,330) |
Cash Flows from Operating Activities: | ||||
Investment in non-consolidated entity | (40) | (657) | (40) | |
Purchase of equipment | (7) | (7) | ||
Purchase of Intangible Asset | (47) | |||
Net Cash used for Investing Activities | (47) | (664) | (87) | |
Cash Flows from Financing Activities: | ||||
Proceeds from (Repayments of) short term loans | (730) | |||
Proceeds from (Repayment of) Loans from Related parties | (355) | |||
Treasury stock | (4) | (29) | ||
Proceeds from issuance of warrants | 4 | |||
Proceeds from issuance of common stock due to exercise of warrants | 2,689 | 6,264 | ||
Proceeds from issuance of common stock, net of issuance expense | 4,319 | 10,614 | ||
Net Cash Provided by Financing Activities | 4,315 | 2,660 | 15,797 | |
Net Increase (Decrease) in Cash | 2,862 | (2,272) | (6,141) | 6,380 |
Cash at Beginning of Period | 466 | 6,607 | 6,607 | 227 |
Cash at End of Period | 3,328 | 4,335 | 466 | 6,607 |
Supplemental disclosure of non-cash financing activities | ||||
Issuance of Shares of Common due to acquisition of an asset | $ 700 | |||
Supplemental disclosure of cash flow information | ||||
Cash paid for interest | ||||
Cash paid for income taxes | ||||
Supplemental disclosure of non-cash financing activities | ||||
Common Stock issued for conversion of convertible note | 81 | |||
Investment in non-consolidated entity in non-consolidated entity against accounts receivables | 233 | |||
Issuance fee in connection with of common stock due to exercise of warrants | $ 499 |
Organization and Description of
Organization and Description of Business | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Disclosure of Organization and Description of Business [Abstract] | ||
ORGANIZATION AND DESCRIPTION OF BUSINESS | NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS Cuentas, Inc. (the “Company”) together with its subsidiaries, is mainly focused on financial technology (“FINTECH”) services, delivering mobile financial services, prepaid debit and digital content services to unbanked, underbanked and underserved communities. During 2023-Q1, the Company initiated its first investment into the Real Estate market and recently, made its second, more significant investment in Real Estate. The Company derived its revenue from GPR “Debit” Card fees and the sales of prepaid products and services including third party digital content, gift cards, remittances, mobile phone topups and other digital services. Additionally, The Company has an agreement with Interactive Communications International, Inc. (“InComm”) a leading processor of general purpose reloadable (“GPR”) debit cards, to market and distribute a line of prepaid digital content and gift cards targeted towards the Latin American market. Cuentas is able to purchase InComm’s prepaid digital content and gift cards at a discount and resell these same products in real time through its mobile app and through the Cuentas-SDI network of over 31,000 bodegas. Cuentas is able to offer these digital products to the public through its mobile app and the Cuentas-SDI distribution network, many at discounted prices, while making a small profit margin which varies from product to product. The prepaid digital content and gift cards include Amazon Cash, XBox, PlayStation, Nintendo, Karma Koin, Transit System Loads & Reloads (LA TAP, NY Transit, Grand Rapids, CT GO and more coming in 2023), Burger King, Cabela’s, Bass Pro Shops, AT&T, Verizon, Mango Mobile, Black Wireless and many more prepaid wireless carriers in the US and in foreign countries. Cuentas accountholders can also send up to $500 anywhere in the world that WesternUnion operates at a discounted rate. The Company’s real estate investments are intended to broaden its reach into the unbanked, underbanked and underserved communities by using a patented, low cost, sustainable technology that should allow the Company to provide reasonably priced rental apartments to working class residents who have been priced out of rental communities due to severe rent hikes in Florida and other areas in the US. The Company was incorporated under the laws of the State of Florida on September 21, 2005 to act as a holding company for its subsidiaries. Its subsidiary is Meimoun and Mammon, LLC (100% owned) (“M&M”),Tel3, a business segment of Meimoun and Mammon, LLC provides prepaid calling cards to consumers directly and operates in a complimentary space as Meimoun and Mammon, LLC. The Company also owns 50% of CUENTASMAX LLC which installs WiFi6 shared network (“WSN”) systems in locations in the New York metropolitan tristate area using access points and small cells to provide users with access to the WSN. On February 3, 2023, the Company entered into a Membership Interest Purchase Agreement (MIPA) with Core Development Holdings Corporation (“Core”). Core is a Florida corporation that holds approximately 29.3% of 4280 Lakewood Road Manager, LLC (“Lakewood Manager”), which in turn owns 86.45% of the membership interests in 4280 Lakewood Road, LLC (“4280 Project”), an affordable multi-family real estate project located in Lake Worth, Florida. Core sold 6% of its interest in the Lakewood Manager to the Company and the Company has agreed to issue to Core 295,282 of the Company’s common shares to acquire the 6% equity in the Lakewood Manager valued at approximately $700. The 295,282 of the Company’s shares were equal to 19.9% of the total number of issued and outstanding shares of the Company as of the date of the Agreement. The Company closed this transaction on or about March 9th, 2023. On April 13, 2023, the Company signed an Operating Agreement to be a majority member in Brooksville Development Partners, LLC (“Brooksville”) with 2 minority members for the purpose of acquiring land for the development of a residential apartment community consisting of approximately 360 apartments. All real and personal property owned by Brooksville shall be owned by Brooksville as an entity, and the Members nor Manager shall not have any ownership interest in such property. One of the minority members will be the manager of the project. On April 28, 2023, the Company and minority partners in Brooksville closed on the transaction to acquire a 21.8 acre site for development of the Brooksville project. Cuentas had deposited an “Initial Capital Contribution” of $2,000 into a title insurance escrow account which was released from escrow by the Title Agent to fund the balance of the purchase price of the Vacant Land, together with a $3,050 bank loan from Republic Bank of Chicago. Brooksville owns the Vacant Land, free and clear of any liens, claims and encumbrances with the sole exception being the Republic Bank loan. The Company is currently a 63% interest holder in Brooksville but that may change in the future if the Company is not able to raise sufficient financing to complete the project. NASDAQ On June 21, 2022, the Nasdaq Listing Qualifications Staff (the “Staff”) issued the Company a delist letter citing its failure to comply with the minimum bid price requirement under Listing Rule 5550(a)(2). In accordance with Listing Rule 5810(c)(3)(A), the Company was provided 180 calendar days, or until December 19, 2022, to regain compliance with Rule 5550(a)(2). On December 20, 2022, Staff notified the Company that it had determined to delist the Company as it did not comply with bid price requirement for listing on the Exchange. On April 14, 2023, the Nasdaq Listing Qualifications Staff issued the Company a compliance letter citing that that the Company regained compliance with the bid price concern. REVERSE SPLIT On March 24, 2023, the Company completed a reverse stock split of its common stock. As a result of the reverse stock split, the following changes have occurred (i) every thirteen shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option or common stock warrant have been proportionately decreased on a 13-for-1 basis, and the exercise price of each such outstanding stock option and common warrant has been proportionately increased on a 13-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 13-for-1 reverse stock split. On April 14, 2023, the Nasdaq Listing Qualifications Staff issued the Company a compliance letter citing that that the Company regained compliance with the bid price concern. GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As of March 31, 2023, the Company had approximately $3,328 in cash and cash equivalents, approximately $1,468 in working capital, shareholder equity of $2,879 and an accumulated deficit of approximately $54,445. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Company’s ability to continue as a going concern is dependent upon raising capital from financing transactions and revenue from operations. Management anticipates their business will require substantial additional investments that have not yet been secured. Management is continuing in the process of fund raising in the private equity and capital markets as the Company will need to finance future activities. These financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern. SECURITIES OFFERING On February 6, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an institutional investor (the “Investor”) for the purpose of raising approximately $5,000 in gross proceeds for the Company. Pursuant to the terms of the Purchase Agreement, the Company agreed to sell, in a registered direct offering, an aggregate of (i) 163,344 shares (the “Shares”) of the Company’s common stock (“Common Stock”) and (ii) pre-warrants to purchase up to 128,031 shares of Common Stock (the “Pre-Funded Warrants” and such shares of Common Stock issuable upon exercise of the Pre-Funded Warrants, the “Pre-Funded Warrant Shares”) and, in a concurrent private placement, warrants (the “Purchase Warrants”) to purchase 291,375 shares of Common Stock (the shares of Common Stock issuable upon exercise of the Purchase Warrants, the “Purchase Warrant Shares”). The combined purchase price per Share and Purchase Warrant is $17.16 and the combined purchase price per Pre-Funded Warrant and Purchase Warrant of $17.16. The Pre-Funded Warrants were sold, in lieu of shares of Common Stock, to any Investor whose purchase of shares of Common Stock in the Registered Offering would otherwise result in such Investor, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at such Investor’s option upon issuance, 9.99%) of the Company’s outstanding Common Stock immediately following the consummation of the Registered Offering. Each Pre-Funded Warrant represents the right to purchase one share of Common Stock at an exercise price of $0.0013 per share. As of March 31, 2023 the Pre-Funded Warrants were exercised in full. The Purchase Warrants will be exercisable on or before August 5, 2023 and will expire on August 5, 2028 at an exercise price of $17.16 per share. The closing of the sales of these securities under the Purchase Agreement occurred on or about February 8, 2023, subject to satisfaction of customary closing conditions. H.C. Wainwright & Co., LLC (“Wainwright”) is acting as exclusive placement agent for the offering pursuant to an engagement agreement between the Company and Wainwright dated as of December 13, 2022. As compensation for such placement agent services, the Company has agreed to pay Wainwright an aggregate cash fee equal to 7.0% of the gross proceeds received by the Company from the offering, plus a management fee equal to 1.0% of the gross proceeds received by the Company from the offerings, a non-accountable expense of $65 and $16 for clearing expenses. The Company has also agreed to issue to Wainwright or its designees warrants to purchase 20,397 shares of Common Stock (the “PA Warrants” and the shares of Common Stock issuable upon exercise of the PA Warrants, the “PA Warrant Shares”). The PA Warrants have a term of five years from the issuance date and have an exercise price of $23.17 per share. The net proceeds to the Company from the registered direct offering and concurrent private placement, after deducting the Placement Agent’s fees and expenses and the Company’s offering expenses were approximately $4,300. | NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS Cuentas, Inc. (the “Company”) together with its subsidiaries, is focused on financial technology (“FINTECH”) services, delivering mobile financial services, prepaid debit and digital content services to unbanked, underbanked and underserved communities. The Company derives its revenue from GPR “Debit” Card fees and the sales of prepaid products and services including third party digital content, gift cards, remittances, mobile phone topups and other digital services. Additionally, The Company has an agreement with Interactive Communications International, Inc. (“InComm”) a leading processor of general purpose reloadable (“GPR”) debit cards, to market and distribute a line of prepaid digital content and gift cards targeted towards the Latin American market. Cuentas is able to purchase InComm’s prepaid digital content and gift cards at a discount and resell these same products in real time through its mobile app and through the Cuentas-SDI network of over 31,000 bodegas. Cuentas is able to offer these digital products to the public through its mobile app and the Cuentas-SDI distribution network, many at discounted prices, while making a small profit margin which varies from product to product. The prepaid digital content and gift cards include Amazon Cash, XBox, PlayStation, Nintendo, Karma Koin, Transit System Loads & Reloads (LA TAP, NY Transit, Grand Rapids, CT GO and more coming in 2023), Burger King, Cabela’s, Bass Pro Shops, AT&T, Verizon, Mango Mobile, Black Wireless and many more prepaid wireless carriers in the US and in foreign countries. Cuentas accountholders can also send up to $500 anywhere in the world that WesternUnion operates at a discounted rate. The Company was incorporated under the laws of the State of Florida on September 21, 2005 to act as a holding company for its subsidiaries. Its subsidiary is Meimoun and Mammon, LLC (100% owned) (“M&M”),Tel3, a business segment of Meimoun and Mammon, LLC provides prepaid calling cards to consumers directly and operates in a complimentary space as Meimoun and Mammon, LLC. The Company also owns 50% of CUENTASMAX LLC which installs WiFi6 shared network (“WSN”) systems in locations in the New York metropolitan tristate area using access points and small cells to provide users with access to the WSN. On March 3, 2022 the Company provided a loan to Cuentas SDI, LLC. As of December 31, 2022 the loan was not returned by Cuentas SDI, LLC and therefore the company recorded a loss of $100. On May 27, 2022, the Company entered into a Membership Interest Purchase Agreement (the “MIPA”) with SDI Black 011, LLC (“SDI Black”), the holders of all the membership interests of SDI Black and Cuentas SDI, LLC, a Florida limited liability (“Cuentas-SDI”), for the acquisition of 19.99% of the membership interests of Cuentas-SDI in exchange for $750,000. The Company also had the right to close on the potential acquisition of the remaining 80.01% of the membership interests of Cuentas-SDI within 60 days (with a potential 30 day extension, the “Potential Acquisition Period”) in exchange for a purchase price of an additional $2,459,000. SDI Black previously transferred all of its assets including the platform, portals, domain names, and related software necessary to conduct its business to Cuentas-SDI. The MIPA further provides that during the Potential Acquisition Period, the Company will invoice and Cuentas-SDI will pay invoices on a seven-net-ten day basis and during this same period, Cuentas-SDI will allow the Company to realize 40% of the Cuentas-SDI gross revenues and reflect 40% of the gross revenues on its books and records. The MIPA contains a number of representations and warranties by each of the parties thereto which we believe are customary for transactions similar to the transactions contemplated by the MIPA. The 60-day option to acquire the remaining 80.01% of the membership interests of Cuentas-SDI expired on July 27, 2022. On August 22, 2022, the Company entered into a Software Licensing and transaction sharing Agreement with The OLB Group, Inc. (“OLB), a Delaware corporation whereas OLB, through its wholly-owned subsidiaries will establish a merchant services relationship whereby the parties will seek to sell or rent OLB’s point-of-sale (POS) devices to merchants in the network established by Cuentas SDI, LLC for the merchants in the SDI network and the Company will use reasonable best efforts to interconnect its reload agreement with the OLB POS platform for use in qualified merchant locations. The Company will market the OLB-branded products under the processing platform as a Cuentas white label application for payment processing and debit cards. OLB will develop for Cuentas’ Mobile App and associated products, an Application Programming Interface (API), databases and servers at no cost to the Company to allow for the registration, approval and onboarding of consumers onto the Cuentas GPR/Mobile App/Mobile Wallet platform with complete functions as currently available through the Cuentas App and associated products and services. OLB agreed to provide OLB’s Services for Cuentas’ benefit in exchange for revenue sharing and OLB will utilize its developers to enhance the Cuentas GPR-Mobile-App. Before the relaunch of the Cuentas GPR-Mobile-App, the OLB developers in consultation with Cuentas shall as necessary test the functionality, reliability and process of the Cuentas GPR-Mobile-App in a controlled testing environment. Upon approval by the Company of the results of the controlled testing environment to move the Cuentas GPR-Mobile-App into production, the OLB developers, in consultation with the Company, shall perform periodic test of the Cuentas GPR-Mobile-App to ensure continued functionality, reliability and process of the Cuentas GPR-Mobile-App and to remove and repair any bugs or malfunctions in the Cuentas GPR-Mobile-App as soon as practicable. All net revenue generated by OLB from the following: (i) net revenues from the sale or rental of OLB POS devices to Cuentas-SDI Merchants, (ii) all other net revenues generated by OLB arising from or related to the OLB POS devices elected to be utilized by the Cuentas-SDI Merchants, (iii) all net revenues generated by OLB from the Cuentas White Label Products/Services, and (iv) to the extent that the Reload Provider agrees to provide its reload capability through the OLB POS devices, the net revenues generated by OLB from the reloads shall be split between OLB and Cuentas. All net revenue generated by Cuentas from the following: (i) net revenues from each reload purchased though the OLB POS device through a Cuentas-SDI Merchant, (ii) all retail digital products as set forth on Schedule A sold through a OLB POS device through a Cuentas-SDI Merchant or the Cuentas White Label Products/Services, (iii) mobile top-ups net revenues sold through a OLB POS device through a Cuentas-SDI Merchant: all net revenues to be split between OLB and Cuentas. Net revenue will be shared between the Parties and profits will be calculated and settled on a 30 net 30 basis (after each 30-day period closes, the Parties have 30 days to calculate and settle net revenue). REVERSE SPLIT On March 24, 2023, the Company completed a reverse stock split of its common stock. As a result of the reverse stock split, the following changes have occurred (i) every thirteen shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option or common stock warrant have been proportionately decreased on a 13-for-1 basis, and the exercise price of each such outstanding stock option and common warrant has been proportionately increased on a 13-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 13-for-1 reverse stock split. GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As of December 31, 2022, the Company had approximately $466 in cash and cash equivalents, approximately $1,445 in negative working capital, negative shareholder equity of $724 and an accumulated deficit of approximately $52750. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Company’s ability to continue as a going concern is dependent upon raising capital from financing transactions and revenue from operations. Management anticipates their business will require substantial additional investments that have not yet been secured. Management is continuing in the process of fund raising in the private equity and capital markets as the Company will need to finance future activities. These financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern. SECURITIES OFFERING On February 2, 2021 the Company’s common stock and warrants began trading on The Nasdaq Capital Market under the symbols “CUEN” and “CUENW,” respectively. On February 4, 2021 the Company sold an aggregate of 214,669 units at a price to the public of $55.90 per unit (the “Offering”), each unit consisting of one share of the Company’s common stock, par value $0.001 per share (the “Common Stock”), and a warrant exercisable for five years to purchase one share of Common Stock at an exercise price of $55.90 per share (the “Warrants”), pursuant to that certain Underwriting Agreement, dated as of February 1, 2021 (the “Underwriting Agreement”), between the Company and Maxim Group LLC (the “Representative” or “Maxim”), as representative of the sole underwriter. In addition, pursuant to the Underwriting Agreement, the Company granted Maxim a 45-day option to purchase up to 32,201 additional shares of Common Stock, and/or 32,201 additional Warrants, to cover over-allotments in connection with the Offering. The Common Stock and the Warrants were offered and sold to the public pursuant to the Company’s registration statements on Form S-1 (File Nos. 333-249690 and 333-252642), filed by the Company with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), on October 28, 2020, as amended, and which became effective on February 1, 2021. The Company received gross proceeds of approximately $12.0 million, before deducting underwriting discounts and commissions of 8% of the gross proceeds and estimated Offering expenses, and intend to use the net proceeds from the Offering for sales and marketing; purchase of chip-based debit card stock for GPR and Starter cards; repayment of outstanding loans; research and development; and working capital and operating expenses purposes. The Underwriting Agreement contains customary representations, warranties, and covenants by the Company. It also provides for customary indemnification by each of the Company and the Underwriter for losses or damages arising out of or in connection with the offering, including for liabilities under the Securities Act, other obligations of the parties and termination provisions. In addition, pursuant to the terms of the Underwriting Agreement, certain existing stockholders and each of the Company’s directors and executive officers entered into “lock-up” agreements with the Underwriter that generally prohibit the sale, transfer, or other disposition of securities of the Company for a period of 180 days following February 1, 2021. The Company has also agreed that it will not issue or announce the issuance or proposed issuance of any common stock or common stock equivalents for a period of 180 days following the closing date, other than certain exempt issuances. Pursuant to the Underwriting Agreement, the Company also agreed to issue to Maxim warrants (the “Underwriter’s Warrants”) to purchase up to a total of 17,174 shares of Common Stock (8% of the shares of Common Stock sold in the Offering). The Underwriter’s Warrants are exercisable at $69.88 per share of Common Stock and have a term of five years. The Underwriter’s Warrants are subject to a lock-up for 180 days from the commencement of sales in the Offering, including a mandatory lock-up period in accordance with FINRA Rule 5110(e), and will be non-exercisable for six months after February 1, 2021. In addition, pursuant to the Underwriting Agreement, the Company granted Maxim a right of first refusal, for a period of twelve months from the commencement of sales in the Offering, to act as sole managing underwriter and bookrunner any and all future public or private equity, equity-linked or debt (excluding commercial bank debt) offerings. The total expenses of the offering are estimated to be approximately $1.4 million, which included Maxim’s expenses relating to the offering. During 2021, 111,881 Warrants issued in the Offering were exercised for 111,881 shares of the Company’s common stock in consideration of $5,765. On August 4, 2022, the Company, entered into a Securities Purchase Agreement (“Purchase Agreement”) with an institutional investor (the “Purchaser”) pursuant to which the Purchaser agreed to purchase, and the Company agreed to issue and sell to the Purchaser in a private placement, an aggregate of 127,308 shares of the Company’s common stock, $0.001 par value, pre-funded warrants to purchase up to 197,620 shares of Common and warrants to purchase up to 324,928 shares of Common Stock. The purchase price per Share and associated Common Stock Warrant was $9.23 and the purchase price per Pre Funded Warrant and associated Common Stock Warrant was $9.23. Each Common Stock Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $7.67 per share. Each Pre Funded Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $0.0001 per share. The Common Stock Warrants are exercisable for a period of five years and six months commencing on the issuance date and the Pre Funded Warrants are exercisable until exercised. The Warrants also contain customary beneficial ownership limitations that may be waived at the option of each holder upon 61 days’ notice to the Company. The Private Placement closed on August 8, 2022. The gross proceeds to the Company, before deducting placement agent fees and other offering expenses, are approximately $3.0 million. On August 4, 2022, in connection with the Private Placement, the Company entered into a registration rights with the Purchaser, pursuant to which the Company agreed to file a registration statement with the Securities and Exchange Commission (the “SEC”) to register for resale the Shares and any shares of the Company’s common stock issuable upon exercise of the Warrants within 30 days of the signing of the Registration Rights Agreement, with such registration statement becoming effective within 60 days after the signing of the Registration Rights Agreement, subject to adjustment in the event of a review by the SEC. The Company is subject to customary penalties and liquidated damages in the event it does not meet certain filing requirements and deadlines set forth in the Registration Rights Agreement. Pursuant to an engagement agreement, H.C. Wainwright & Co., LLC (the “Placement Agent’) was engaged by the Company to act as its placement agent for the Private Placement. The Company agreed to pay the Placement Agent a cash fee equal to 7.0% of the gross proceeds received by the Company in the Private Placement, in addition to the reimbursement of certain expenses. The Company also agreed to issue to the Placement Agent warrants to purchase up to 22,745 shares of Common Stock, exercisable for a period of five years and six months commencing on the issuance date, at an exercise price of $11.54 per share. |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Basis of Presentation | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION Unaudited Interim Financial Statements The accompanying unaudited consolidated financial statements include the accounts of the Company and its subsidiaries, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, the financial statements presented herein have not been audited by an independent registered public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the for three-months ended March 31, 2023. However, these results are not necessarily indicative of results for any other interim period or for the year ended December 31, 2023. The preparation of financial statements in conformity with GAAP requires the Company to make certain estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues, and expenses. Actual amounts could differ from these estimates. Certain information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission (“SEC”). The accompanying unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 31, 2023 (the “Annual Report”). For further information, reference is made to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Principles of Consolidation The consolidated financial statements are prepared in accordance with US GAAP. The consolidated financial statements of the Company include the Company and its wholly owned and majority-owned subsidiaries. All inter-company balances and transactions have been eliminated. Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. Deferred Revenue Deferred revenue is comprised mainly of unearned revenue related to prepayments from retail consumers for telecommunications minutes. The following table represents the changes in deferred revenue for the three months ended March 31, 2023: Deferred Balance at December 31, 2022 $ 113 Change in deferred revenue (4 ) Balance at March 31, 2023 $ 109 Revenue allocated to remaining performance obligations represent contracted revenue that has not yet been recognized (“contracted not recognized”). Contracted not recognized revenue was $109 as of March 31, 2023, of which the Company expects to recognize 100% of the revenue over the next 12 months. Derivative and Fair Value of Financial Instruments Fair value of certain of the Company’s financial instruments including cash, accounts receivable, accounts payable, accrued expenses, notes payables, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of March 31, 2022 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 1 - - 1 Total liabilities 1 - - 1 Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities - - - - Total liabilities - - - - Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This updated guidance sets forth a current expected credit loss model based on expected losses. Under this model, an entity recognizes an allowance for expected credit losses based on historical experience, current conditions and forecasted information rather than the current methodology of delaying recognition of credit losses until it is probable a loss has been incurred. This guidance becomes effective for the Company beginning in interim periods starting in fiscal year 2023. The impact of adopting the new standard did not have a material impact on the Company’s consolidated financial statements. Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our financial statements upon adoption. | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“‘US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. As applicable to the consolidated financial statements, the most significant estimates and assumptions relate to allowances for impairment of intangible assets and fair value of stock-based compensation and fair value calculations related to embedded derivative features of outstanding convertible notes payable. Principles of consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Functional currency The functional currency of the company and its subsidiaries is U.S dollar. Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. Cash and cash equivalents The Company considers all short-term investments, which are highly liquid investments with original maturities of three months or less at the date of purchase, to be cash equivalents. Allowance for credit losses The Company adopted the Current Expected Credit Losses (“CECL”) guidance effective January 1, 2020. The Company maintains the allowance for estimated losses resulting from the inability of the Company’s customers to make required payments. The allowance represents the current estimate of lifetime expected credit losses over the remaining duration of existing accounts receivable considering current market conditions and supportable forecasts when appropriate. The estimate is a result of the Company’s ongoing evaluation of collectability, customer creditworthiness, historical levels of credit losses, and future expectations. Changes in the allowance for credit losses are recognized in, general and administrative expenses. Accounts receivables are written-off against the allowance for credit losses when management deems the accounts are no longer collectible. There was an allowance for doubtful accounts of $177 and $20 as of December 31, 2022 and 2021. Leases The Company accounts for leases in accordance with ASC 842, The Company determines if an arrangement is a lease at inception. Balances related to operating leases are included in operating lease right-of-use (“ROU”) assets, current maturities of operating leases liabilities and Non-current operating leases liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized as of the commencement date based on the present value of lease payments over the lease term. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The discount rate for the lease is the rate implicit in the lease unless that rate cannot be readily determined. As the Company’s leases do not provide an implicit rate, the Company’s uses its estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term , As of December 31, 2022 the Company has lease agreement of less than 12 months. Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. The Company provides for depreciation and amortization using the straight-line method over the estimated useful lives of the related assets, which range from three to five years. Variable Interest Entities The Company account for variable interest entities in accordance with ASC Topic 810, Consolidation Impairment of Long-Lived Assets The Company’s long-lived assets, such as property, plant and equipment and identifiable intangible assets, are reviewed for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment indicators which could trigger an impairment may include, among others, any significant changes in the manner of our use of the assets or the strategy of our overall business, certain reorganization initiatives, significant negative industry, or economic trends or when we conclude that it is more likely than not that an asset will be disposed of or sold. Long-lived assets are reviewed for impairment in accordance with ASC No. 360, “Property, Plant and Equipment,” whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. This measurement includes significant estimates and assumptions inherent in the estimate of the fair value of identifiable intangible assets. Newly acquired and recently impaired indefinite-lived assets are more vulnerable to impairment as the assets are recorded at fair value and are then subsequently measured at the lower of fair value or carrying value annually or when triggering events are present. As such, immediately after acquisition or impairment, even small declines in the outlook for these assets can negatively impact on our ability to recover the carrying value and can result in an impairment charge. The Company did not record impairment losses during the year ended December 31, 2021. The Company recorded impairment losses in the amount of $3,600 thousand during the year ended December 31, 2022. Derivative Liabilities and Fair Value of Financial Instruments Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments and measurement of their fair value for accounting purposes. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt under ASC Topic 470, the Company will continue its evaluation process of these instruments as derivative financial instruments under ASC Topic 815. Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. Fair value of certain of the Company’s financial instruments including cash, accounts receivable, account payable, accrued expenses, notes payables, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC Topic 820, “Fair Value Measurements and Disclosure” Fair value, as defined in ASC Topic 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC Topic 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC Topic 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), (ii) segregating those gains or losses included in earnings and (iii) a description of where those gains or losses included in earning are reported in the statement of income. The Company records a debt discount related to the issuance of convertible debts that have conversion features at adjustable rates. The debt discount for the convertible instruments is recognized and measured by allocating a portion of the proceeds as an increase in additional paid-in capital and as a reduction to the carrying amount of the convertible instrument equal to the fair value of the conversion features. The debt discount will be accreted by recording additional non-cash gains and losses related to the change in fair values of derivative liabilities over the life of the convertible notes. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Marketable securities - - - - Total assets - - - - Liabilities: Stock based liabilities - - - - Total liabilities - - - - Balance as of December 31, 2021 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 3 - - 3 Total liabilities 3 - - 3 Deferred Revenue The Company records deferred revenue for any upfront payments received in advance of the Company’s performance obligations being satisfied. These contract liabilities consist principally of unearned new minutes fees. Changes in the deferred revenue balance are driven primarily by the amount of new minutes fees recognized during the period, and the degree to which these reductions to the deferred revenue balance are offset by the deferral of new minutes fees associated with minutes sold during the period. Non-Controlling Interest The Company reports the non-controlling interest in its majority owned subsidiaries in the consolidated balance sheets within the stockholders’ deficit section, separately from the Company’s stockholders’ deficit. Non-controlling interest represents the non-controlling interest holders’ proportionate share of the equity of the Company’s majority-owned subsidiaries. Non-controlling interest is adjusted for the non-controlling interest holders’ proportionate share of the earnings or losses and other comprehensive income (loss) and the non-controlling interest continues to be attributed its share of losses even if that attribution results in a deficit non-controlling interest balance. Revenue Recognition The Company follows paragraph 605-10-S99 of the FASB Accounting Standards Codification for revenue recognition. The Company will recognize revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable and (iv) collectability is reasonably assured. The Company primarily generates revenues through the brokering of sales of minutes from one telecommunications carrier to another and to a lesser extent the sales of prepaid calling minutes to consumers through its Tel3 division. While the Company collects payment for such minutes in advance, revenue is recognized upon delivery to and consumption of minutes by the consumer. Minutes are forfeited buy the consumer after twelve consecutive months of non-use at which point the Company recognizes revenue from the forfeiture of prepaid minutes. The Company is also recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (ASC 606), when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expect to receive in exchange for those goods or services. To determine whether arrangements are within the scope of ASC 606, the Company perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligation. The Company apply the five-step model to contracts when it is probable that the Company will collect the consideration the Company are entitled to in exchange for the goods or services the Company transfer to the customer. At contract inception, once the contract is determined to be within the scope of this guidance, the Company assessed the goods or services promised within each contract and identify, as a performance obligation, and assess whether each promised good or service is distinct. The Company then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Business Segments The Company operates in a two-business segments of telecommunications and General Purpose Reloadable Cards. Income Taxes Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code Section 382 if a change of ownership occurs. Net Loss Per Basic and Diluted Common Share Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity. At December 31, 2022, potentially dilutive securities consisted of 615,063 shares which of 128,477 options to purchase of common stock at prices ranging from $36.40 to $186.55 per share and 486,587 warrants to purchase of common stock at prices ranging from $7.67 to $260.00 per share. The effects of these options and warrants been excluded as the conversion would be anti-dilutive due to the net loss incurred in the year ended December 31, 2022. At December 31, 2021, potentially dilutive securities consisted of 260,854 shares which of 121,938 options to purchase of common stock at prices ranging from $36.40 to $186.55 per share and 138,915 warrants to purchase of common stock at prices ranging from $55.90 to $260.00 per share. The effects of these options and warrants been excluded as the conversion would be anti-dilutive due to the net loss incurred in the year ended December 31, 2021. Advertising Costs The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred $1 and $37 of advertising costs during the years ended December 31, 2022 and 2021, respectively. Stock-Based Compensation The Company applies ASC Topic 718-10, “Share-Based Payment,” which requires the measurement and recognition of compensation expenses for all share-based payment awards made to employees and directors (including employee stock options under the Company’s stock plans) based on estimated fair values. ASC Topic 718-10 requires companies to estimate the fair value of equity-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s statement of operations. The Company recognizes compensation expenses for the value of non-employee awards based on the straight-line method over the requisite service period of each award, net of estimated forfeitures. The Company estimates the fair value of stock options granted as equity awards using a Black-Scholes options pricing model. The option-pricing model requires a number of assumptions, of which the most significant are share price, expected volatility and the expected option term (the time from the grant date until the options are exercised or expire). Expected volatility is estimated based on volatility of similar companies in the technology sector. The Company has historically not paid dividends and has no foreseeable plans to issue dividends. The risk-free interest rate is based on the yield from governmental zero-coupon bonds with an equivalent term. The expected option term is calculated for options granted to employees and directors using the “simplified” method. Grants to non-employees are based on the contractual term. Changes in the determination of each of the inputs can affect the fair value of the options granted and the results of operations of the Company. Related Parties The registrant follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions. Pursuant to Section 850-10-20 of the FASB Accounting Standards Codification, the Related parties include (a) affiliates of the registrant; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825-10-15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the registrant; (e) management of the registrant; (f) other parties with which the registrant may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. Recently Issued Accounting Standards Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging and Topic 825, Financial Instruments Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our financial statements upon adoption. |
Investments in Unconsolidated E
Investments in Unconsolidated Entities | 12 Months Ended |
Dec. 31, 2022 | |
Investments in Unconsolidated Entities [Abstract] | |
INVESTMENTS IN UNCONSOLIDATED ENTITIES | NOTE 3 -INVESTMENTS IN UNCONSOLIDATED ENTITIES On July 21, 2021, The Company and WaveMAX entered into a Definitive Joint-Venture Agreement (the “Agreement”). Pursuant to the Agreement, Cuentas and WaveMax are to form a joint venture (“CUENTASMAX”) which would install WiFi6 shared network (“WSN”) systems in 1,000 retail locations in the New York metropolitan tristate area using access points and small cells to provide users with access to the WSN (the “JV Project”). The WSN will allow CUENTASMAX to generate location-based advertising configured by advertisers using WaveMAX’s advertising dashboard technology directly to users over the WSN, or permit users to pay a service fee for ad-free access to the WSN. The ownership and management of CUENTASMAX shall be as follows: 50% to Cuentas, 25% to WaveMAX and 25% to Consultoria y Asesoria de Redes, S.A. de C.V. (“Execon”). Execon currently manages approximately 20,000 WiFi endpoints with WaveMax in Mexico. Each of the Company and WaveMAX agrees to fund $120,000 (for a total of $240,000) initially upon execution of the Agreement. In addition, each of Cuentas and WaveMAX has agreed to fund an additional $127,500 over the succeeding five months, in each case, subject to approval of each party’s board of directors. The expenses of the JV Project shall include acquiring the Access Points hardware, the installation and configuration of the Access Points hardware for use with the broadband internet service at each Retail Location, entering into the necessary agreements with the Retail Locations, instore marketing and promotion of the WSN program, and expenses relating to commercialization of the digital advertising program. The Board of Directors of CUENTASMAX shall initially be comprised of four persons, two designated by Cuentas, one designated by WaveMAX, and one designated by Execon. The officers of CUENTASMAX shall be the persons from time to time designated by mutual agreement of Cuentas and WaveMAX, with the initial officers to be determined. Up to 1,000 high traffic, prime location convenience stores and “bodegas” (small community markets) will be signed up in conjunction with Cuentas’ distribution network that sells prepaid debit card, e-store, e-wallet and digital services. A fee of 2% (two percent) of the Net Revenue of CUENTASMAX will be paid by CUENTASMAX on a monthly basis as a commission to Innovateur Management SAPI de CV. WaveMax and Innovateur Management, SAPI de CV will be included in the Cuentas Share Incentive plan subject to approval by the Cuentas BOD and approval by Cuentas shareholders and Side Letter Participants at the next scheduled Annual Shareholders meeting. WaveMAX grants CUENTASMAX exclusive rights to use and deploy the WaveMAX Technology, including any and all patents owned or to be owned by WaveMAX and any and all related enhancements or applications of the WaveMAX Technology and any and all prior and subsequent improvements and/or new technology developed by WaveMAX solely in Cuentas BODEGAS network throughout the United States. The parties have agreed to expand CUENTASMAX to other areas of the US once the current deployment is in progress or has been completed. As of December 31,2022, the Company funded $80 in CUENTASMAX and recorded equity losses in the amount of $58. On May 27, 2022, the Company entered into a Membership Interest Purchase Agreement (the “MIPA”) with SDI Black 011, LLC (“SDI Black”), the holders of all the membership interests of SDI Black and Cuentas SDI, LLC, a Florida limited liability (“Cuentas-SDI”), for the acquisition of 19.99% of the membership interests of Cuentas-SDI in exchange for $750,000 in addition to a loan in the amount of $100,000 that was provided to Cuentas SDI, LLC for the marketing purposes. SDI Black previously transferred all of its assets including the platform, portals, domain names, and related software necessary to conduct its business to Cuentas-SDI. As of December 31, 2022, Cuentas-SDI did not repay the loan to the Company and therefore that Company wrote off the entire loan. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets [Abstract] | |
INTANGIBLE ASSETS | NOTE 4 - INTANGIBLE ASSETS On December 31, 2019, the Company entered into a series of integrated transactions to license the Platforms from CIMA, through CIMA’s wholly owned subsidiaries Knetik, and Auris (the “Transaction Closing”) pursuant to that certain Platform License Agreement, dated December 31, 2019 by and among (i) the Company, (ii) CIMA, (iii) Knetik and (iv) Auris (the “License Agreement”) and the various other agreements. Under the License Agreement Cima received a one-time licensing fee in the amount of $9,000 in the form of a convertible note that may be converted, at the option of Cima, into up to 25% of the total shares of Common Stock of the Company, par value $0.001 per share (the “Common Stock”) on a fully diluted basis as of December 31, 2019. The acquired intangible assets that consisted of perpetual software license had an estimated fair value of $9,000. The Company will amortize the intangible assets on a straight-line basis over their expected useful life of 60 months. Identifiable intangible assets were recorded as follows: Asset Amount Life Intangible Assets $ 9,000 60 Total $ 9,000 60 Intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed periodically for impairment. On March 5, 2021, the Company purchased the domain www.cuentas.com in consideration of $47. The Company will amortize the intangible assets on a straight-line basis over their expected useful life of 60 months. Identifiable intangible assets were recorded as follows: Asset Amount Life Intangible Assets $ 47 60 Total $ 47 60 Intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed periodically for impairment. Amortization of intangible assets for each of the next five years and thereafter is expected to be as follows: Year ended December 31, 2023 $ 10 2024 10 2025 8 Total $ 28 Amortization expense was $1,810 for the year ended December 31, 2022, and $1,809 for the year ended December 31, 2021, respectively. Amortization expense for each period is included in operating expenses. During the year ended December 31, 2022, the Company recorded an impairment charges related to the acquired intangible assets that consisted of perpetual software license in the amount of $3,600. |
Other Accounts Liabilities
Other Accounts Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Other Accounts Liabilities [Abstract] | |
OTHER ACCOUNTS LIABILITIES | NOTE 5 - OTHER ACCOUNTS LIABILITIES December 31, December 31, Accrued expenses, interest and other liabilities $ 309 $ 1,063 Accrued salaries and wages 105 63 Accrued bonuses 267 - Total $ 681 $ 1,126 |
Related Party Transactions
Related Party Transactions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Related Party Transactions [Abstract] | ||
RELATED PARTY TRANSACTIONS | NOTE 4 - RELATED PARTY TRANSACTIONS Related parties balances at March 31, 2023 and December 31, 2022 consisted of the following: Due from related parties March 31, December 31, (dollars in thousands) Arik Maimon (Chairman of the Board and the CEO) 42 - Michael De Prado (Vice Chairman of the Board and President) 46 - SDI Cuentas LLC, net of allowance for credit losses of $157 as of March 31, 2023 and December 31,2022, respectively. 210 198 Total Due from related parties 298 198 Related party transactions Period ends at Period ends at (dollars in thousands) Sales to SDI Cuentas LLC $ 12 $ 214 Carol Pepper (b) - 40 Cima Telecom Inc. (a) $ - 324 $ - $ 364 (a) Composed of periodic fees in the amount of $177 thousand for the maintenance and support services in accordance with the software maintenance agreement for the first quarter of the third calendar year and $147 thousand for software development services during the first quarter of 2022. (b) Composed of a consulting fee in addition to the directorship fees. | NOTE 6 - RELATED PARTY TRANSACTIONS The Company has had extensive dealings with related parties including those in which our interim Chief Executive Officer and Chairman of the Board holds a significant ownership interest as well as an executive position during the years ended December 31, 2022 and 2021. Employment Agreements On July 24, 2020, the Compensation Committee (the “Compensation Committee”) of the Board of Directors of Cuentas Inc. (the “Company”) approved the Amended and Restated employment agreements with each of Arik Maimon, the Company’s Chief Executive Officer (“Maimon”), and Michael De Prado, the Company’s President (“De Prado,” and together with Maimon, the “Executives,” each an “Executive”), the “New Employment Agreements”. The New Employment Agreements shall supersede the terms of the Pre-existing Employment Agreements. Pursuant to the terms of the New Employment Agreements, among other things: (1) De Prado will receive the following compensation: (1) (a) a base salary of $265,000 per annum; (b) a Funding Bonus equal to 0.5% of the amount of the funding that exceeds the Funding Threshold; (c) a change of control bonus, if applicable; (d) participation in the Company’s employee benefits plan; (2) Maimon will receive the following compensation: (a) a base salary of $295,000 per annum; (b) a Funding Bonus equal to 0.5% of the amount of the funding that exceeds the Funding Threshold; (c) a change of control bonus, if applicable; (d) participation in the Company’s employee benefits plan; (3) For each Executive, the term of the Agreement shall end on the earlier of (i) the date that is four months following the Effective Date or (ii) the date that the Company appoints a new president or chief operating officer but the Company can extend the Employment Term on a month to month basis with the approval of both Dinar Zuz LLC (“Dinar”) and CIMA until a new president or chief operating officer is appointed. Upon expiration of the Employment Term (other than a termination by the Company for “Cause”), the Executive will entitled to a special board compensation package with annual compensation equal to the Annual Base Salary (pro-rated for any partial year of service), beginning on the Expiration or Termination Date and ending 18 months later, provided that such payments will cease if the Executive resigns as a member of the Board during such period. The Board Compensation Period may be extended from year to year for an additional 12 months (for up to 36 months in total) if two of three of the then-current chief executive officer of the Company, Dinar and CIMA agree to extend the period for an additional 12 months. The Executive’s right to receive the Special Board Compensation shall be subject to the Board’s determination that he has complied with his obligations under this Agreement. The Executive will remain on the Board until he resigns, is not re-elected or is removed from the Board in accordance with the Company’s practice for removal of directors. (4) Pursuant to the terms of the New Employment Agreements, the Executives are entitled to severance in the event of certain terminations of his employment. The Executives are entitled to participate in the Company’s employee benefit, pension and/or profit-sharing plans, and the Company will pay certain health and dental premiums on their behalf. (5) Each of the Executives are entitled to travel and expense reimbursement; (6) The Executives have agreed to a one-year non-competition agreement following the termination of their employment. On February 24, 2021, the employment agreement dated July 24, 2020 for Arik Maimon expired in accordance with its terms and as previously disclosed by the Company. As a result of the expiration of the employment agreement, Mr. Maimon was no longer employed as the Chief Executive Officer of the Company, but he continued to act as Chairman of the Board of Directors of the Company. On February 25, 2021, the Board appointed Mr. Maimon to act as interim Chief Executive Officer, which position will terminate upon the earlier of August 25, 2021 or the date on which his successor is duly elected and appointed by the Board of the Company. On February 24, 2021, the employment agreement dated July 24, 2020 for Michael De Prado expired in accordance with its terms and as previously disclosed by the Company. As a result of the expiration of the employment agreement, Mr. De Prado is no longer the President of the Company but has become the Vice Chairman of the Board. On March 5, 2021 and pursuant to the Side Letter Agreement, the Board of Directors of the Company approved a special bonus in the amount of $500 to each of Mr. Maimon and Mr. De Prado due to the successful up-listing of the Company’s shares on the Nasdaq Capital Markets. Half of the bonus $250 was paid in cash and half will be paid in Common stock of the Company . On August 2, 2021, the Company’s Board of Directors approved the payment of the remainder of the up-listing bonus to Mr. Maimon and Mr. De Prado in the amount of $250 for each of them. On the same date, the Company paid $250 to Mr. Maimon and $250 for Mr. De Prado as described above. On August 26, 2021, the Company and Arik Maimon entered into a Founder/Executive Chairman Compensation Agreement. Additionally, on August 26, 2021, the Company and Michael De Prado entered into a Founder/Executive Vice-Chairman Compensation Agreement (the “Compensation Agreements”). The term of each of these Compensation Agreements became effective as of August 26, 2021 and replaces any prior arrangements or employment agreements between the Company and each of Mr. Maimon and Mr. De Prado. Under the terms of the Compensation Agreements, the Executives agreed to be employed by the Company for an initial continuous twelve-month term beginning on the effective date of August 26, 2021, and ending on August 25, 2022. The initial term would be automatically extended for additional one (1) year periods on the same terms and conditions as set out in the Compensation Agreements; however, the Compensation Agreements, respectively, will not renew automatically if either the Company or the respective Executive provide a written notice to the other of a decision not to renew, which notice must be given at least ninety (90) days prior to the end of the initial term or any subsequently renewed one (1) year term. Pursuant to the terms of his Compensation Agreement, Mr. Maimon will receive an annual base salary of two hundred ninety-five thousand dollars ($295) per year, and pursuant to the terms of his Compensation Agreement, Mr. De Prado will receive an annual base salary of two hundred seventy-five thousand dollars ($275) per year, and each will be eligible for an annual incentive payment of up to one hundred percent (100%) of their respective base salary, which annual incentive payment shall be based on the Company’s performance as compared to the goals established by the Company’s Board of Directors in consultation with each Executive, respectively. This annual incentive shall have a twelve (12) month performance period and will be based on a January 1 through December 31 calendar year, with the Executives’ entitlement to the annual incentive and the amount of such award, if any, remaining subject to the good faith discretion of the Board of Directors. Any such annual incentive shall be paid by the end of the second quarter following the calendar year to which each respective Executive’s performance relates. Pursuant to the terms of the Compensation Agreements, each of Mr. Maimon and Mr. De Prado has the option to have any such earned annual incentive be paid in fully vested shares of the Company’s Common Stock, but must elect such option by the end of the first quarter following the relevant performance calendar year period. In the event of a change in control of the Company, as defined under the terms of the Compensation Agreements, that takes place (i) during the term of the Compensation Agreement or (ii) prior to the date which is twenty-four (24) months from the effective date of the Compensation Agreements, if the Executive’s employment otherwise terminates prior to such date, each respective Executive shall be entitled to a bonus payment equal to two and one-half percent (2.5%) of the cash consideration received by the shareholders of the Company in the change in control transaction. On August 19, 2022, the Company’s Board of Directors approved a motion to appoint Arik Maimon as Interim CEO (in addition to his current position as Chairman of the Board) and Michael De Prado as Interim President (in addition to his current position as Vice Chairman of the Board). Both Arik Maimon and Michael De Prado agreed to assume these positions with no additional compensation. On August 25, 2021, the Company and Jeffery D. Johnson entered into an employment agreement, pursuant to which Mr. Johnson agreed to serve as the Company’s new Chief Executive Officer (“The Johnson Employment Agreement”). The Johnson Employment Agreement commenced and became effective as of August 25, 2021, and shall continue for an initial term of three (3) years, ending on August 24, 2024. The initial term would be automatically extended for additional one (1) year periods on the same terms and conditions as set out in the Johnson Employment Agreement; however, the Employment Agreement will not renew automatically if either the Company or Mr. Johnson provide a written notice to the other of a decision not to renew, which notice must be given at least ninety (90) days prior to the end of the initial term or any subsequently renewed one (1) year term. Pursuant to the terms of the Johnson Employment Agreement, Mr. Johnson will receive an annual base salary of three hundred thousand dollars ($300) per year, and will be eligible for an annual incentive payment of up to one hundred percent (100%) of his base salary, which annual incentive payment shall be based on the Company’s performance as compared to the goals established by the Company’s Board of Directors in consultation with Mr. Johnson. This annual incentive shall have a twelve (12) month performance period and will be based on a January 1 through December 31 calendar year, with Mr. Johnson’s entitlement to the annual incentive and the amount of such award, if any, remaining subject to the good faith discretion of the Board of Directors. Pursuant to the terms of the Johnson Employment Agreement, Mr. Johnson has the option to have any such earned annual incentive be paid in fully vested shares of the Company’s Common Stock, but must elect such option by the end of the first quarter following the relevant performance calendar year period. In consideration of Mr. Johnson’s agreement to enter into the Johnson Employment Agreement and remain with the Company, Mr. Johnson was to receive a one-time signing bonus in the amount of two hundred thousand dollars ($200), which is to be paid in two (2) installments: the first installment of one hundred thousand dollars ($100) to be paid on the Company’s next regular payday following the hire date of August 25, 2021, which was paid on August 30, 2021, and the second installment of one hundred thousand dollars ($100) to be paid on Company’s next regular payday following the first (1 st On August 5, 2021, the Company and its Chief Financial Officer entered in an Amendment of his Employment Agreement where his annual base salary will be $245 and he will not be entitled to a cash payment of his accrued vacation and sick days. On December 31, 2019, the Company entered into a series of integrated transactions to license the Platforms from CIMA, through CIMA’s wholly owned subsidiaries Knetik, and Auris (the “Transaction Closing”) pursuant to that certain Platform License Agreement, dated December 31, 2019 by and among (i) the Company, (ii) CIMA, (iii) Knetik and (iv) Auris (the “License Agreement”) and the various other agreements listed below. Under the License Agreement Cima received a one-time licensing fee in the amount of $9,000 in the form of a convertible note that may be converted, at the option of Cima, into up to 25% of the total shares of Common Stock of the Company, par value $0.001 per share (the “Common Stock”) on a fully diluted basis as of December 31, 2019 . Pursuant to the License Agreement, the Company shall pay CIMA annual fees for the maintenance and support services in accordance with the following schedule: (i) for the first (1st) calendar year from the Effective Date, $300 were paid in 2020; (ii) for the second (2nd) calendar year from the Effective Date, $500 , were paid in 2021; (iii) for the third (3rd) calendar year from the Effective Date, $700 to be paid during 2022; (iv) for the fourth (4th) calendar year from the Effective Date, $1,000 to be paid on December 31, 2022; (v) for the fifth (5th) calendar year from the Effective Date, $640 to be paid on December 31, 2022; and (vi) for each calendar year thereafter, $640 to be paid on the anniversary date On August 2, 2022, the Company and CIMA, along with two of CIMA’s wholly-owned subsidiaries, Knetik and Auris executed a Settlement Agreement and General Release (“Settlement Agreement”) which provides the following: In exchange for the consideration provided in the Settlement Agreement, (1) the Company paid CIMA $350 on or about August 2, 2022 and (2) on or about August 15, 2022, Cuentas paid CIMA the balance of the unpaid Fees of $420 CIMA agreed: (i) to restore immediately Cuentas’s access to the Platform upon receipt of the $350 payment; (ii) to provide Cuentas with a limited license to utilize the Platform the terms of which are detailed specifically in the Settlement Agreement, and to use reasonable efforts, subject to Cuentas’ compliance hereto, to provide the Company’s customer data to the Company through the end of the limited license term; (iii) deliver to the Company the Source Code relating to Out-Of-Scope Services, and as further detailed in the settlement agreement; The Settlement Agreement also provides other terms and for mutual general releases by the Company for the benefit of CIMA and by CIMA for the benefit of the Company of all claims other than claims relating to a breach of the Settlement Agreement. The settlement agreement by its terms in effect terminates the obligations under the license agreement, dated December 31, 2019 by and between the Company and CIMA. Per the settlement agreement, the ownership of the platforms will be maintained by the Company and Cima will not be obligated to provide services under the license agreement. Related parties balances at December 31, 2021 and December 31, 2020 consisted of the following: Due from related parties December 31, December 31, (dollars in thousands) SDI Cuentas LLC, net of allowance for credit losses of $157 and $0 as of December 31, 2022 and December 31,2021, respectively. 198 1 Total Due from related parties 198 1 Related party payables, net of discounts December 31, December 31, (dollars in thousands) (a) Due to Cima Telecom Inc. $ - 250 Total Due from related parties $ - $ 250 (a) Composed from annual fees in the amount of $250 for the maintenance and support services in accordance with the software maintenance agreement for the second calendar year from the Effective Date and other software development services. Related party transactions Year Year (dollars in thousands) Sales to SDI Cuentas LLC $ 2,052 $ 62 Consulting fees to Angelo De Prado (a) 6 - Consulting fees to Sima Maimon Bakhar (b) 10 - Doubtful accounts - Cuentas SDI LLC 157 - Consulting fees to Carol Pepper (d) - 40 Cima Telecom Inc. (c) $ 918 840 $ 1,051 $ 880 (a) Angelo De Prado is the son of Michael De Prado. (b) Sima Maimon Bakhar is the wife of Aril Maimon. (c) Composed of periodic fees in the amount of $700 thousand for the maintenance and support services in accordance with the software maintenance agreement and the Settlement Agreement and General Release dated August 2, 2022 and $500 for the first half of the second calendar year from the effective date of the agreement, $218 thousand for software development and other services during 2022 and $340 thousand for software development and other services during 2022. Refer to note 10. The maintenance and support services and most of the software development and other services were recorded in cost of goods sold in the Digital products and General-Purpose Reloadable Cards segment. (d) Composed of consulting fee in additional to the directorship fees. |
Stock Options
Stock Options | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Stock Options [Abstract] | ||
STOCK OPTIONS | NOTE 3 - STOCK OPTIONS The following table summarizes all stock option activity for the three months ended March 31, 2023: Shares Weighted- Outstanding, December 31, 2022 128,477 $ 56.44 Granted - - Forfeited 6,093 186.55 Outstanding, March 31, 2023 122,384 $ 49.96 The following table discloses information regarding outstanding and exercisable options as of March 31, 2023: Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 97.50 2,769 97.50 0.46 2,769 97.50 67.99 1,538 67.99 0.99 1,538 67.99 36.40 118,077 36.40 8.68 110,382 36.40 122,384 $ 49.96 8.38 114,689 $ 38.30 The following table discloses information regarding outstanding and exercisable options at March 31, 2022: Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 186.55 6,093 $ 186.55 0.99 6,093 $ 186.55 97.50 2,769 97.50 1.46 2,769 97.50 67.99 1,538 67.99 1.99 1,538 67.99 36.40 126,923 36.40 9.59 53,846 36.40 137,323 $ 47.97 8.88 64,246 $ 54.08 | NOTE 8 - STOCK OPTIONS The following table summarizes all stock option activity for the year ended December 31, 2022: Shares Weighted- Outstanding, December 31, 2021 121,938 $ 47.97 Granted 38,461 36.40 Forfeited (31,922 ) 36.40 Outstanding, December 31, 2022 128,477 $ 56.44 The following table discloses information regarding outstanding and exercisable options as of December 31, 2022: Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 186.55 6,093 $ 186.55 0.24 6,093 $ 186.55 97.50 2,769 97.50 0.71 2,769 97.50 67.99 1,538 67.99 1.24 1,538 67.99 36.40 118,077 36.40 8.88 110,382 36.40 128,477 $ 56.42 8.14 120,782 $ 45.78 On December 30, 2022, the Company issued 7,692 options to its member of the board of the Directors of the Company. The options carry an exercise price of $36.40 per share. half of the options vested on December 30, 2022 and the balance shall vest on the first anniversary of grant date, so long as they engaged by the Company on that date. The Options are exercisable until December 30, 2032. The Company has estimated the fair value of such options at a value of $18 at the date of issuance using the Black-Scholes option pricing model using the following assumptions: Common stock price 2.366 Dividend yield 0 % Risk-free interest rate 3.88 % Expected term (years) 10 Expected volatility 454 % On August 19, 2022, the Board of Directors approved the immediate acceleration of the vesting of 12,307 options previously issued under the Stock Option Plan to Jeffery D. Johnson that will be exercisable for a period of three years after his resignation. On May 17, 2022, the Company issued 15,384 options to its two members of the board of the Directors of the Company. The options carry an exercise price of $36.40 per share. half of the options vested on May17, 2022 and the balance shall vest on the first anniversary of grant date, so long as they engaged by the Company on that date. The Options are exercisable until May 17, 2032. The Company has estimated the fair value of such options at a value of $134 at the date of issuance using the Black-Scholes option pricing model using the following assumptions: Common stock price 8.71 Dividend yield 0 % Risk-free interest rate 2.98 % Expected term (years) 10 Expected volatility 480 % On February 1, 2022, the Company issued 15,384 options to its Chief Operating Officer of the Company. The options carry an exercise price of $36.40 per share. 3,847 of the options vested on February 1, 2022. The option shall vest on the first, second and third anniversary of grant date, so long as its Chief Operating Officer is employed by the Company on that date. The Options are exercisable until January 31, 2032. The Company has estimated the fair value of such options at a value of $213 at the date of issuance using the Black-Scholes option pricing model using the following assumptions: Common stock price 13.91 Dividend yield 0 % Risk-free interest rate 1.79 % Expected term (years) 10 Expected volatility 197 % On November 3, 2021, the Company issued 119,229 stock options to executives’ officers and non-employee directors. The options vest on the terms set forth on the table below. Such options can be exercised until, November 2, 2031, and were approved by the Company’s shareholders on December 15, 2021. Name Number of Exercise Vesting Schedule Jeffery D Johnson 38,462 $ 36.40 9,616 on grant date. 14,423 on each of the next 2 Employment Anniversaries. Shalom Arik Maimon 15,385 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Michael DePrado 11,538 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Ran Daniel 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Richard Berman 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Yochanon Bruk 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Jeff Lewis 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date David Schottenstein 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Adiv Baruch 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Carol Pepper 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date The Company has estimated the fair value of such options at a value of $4,340 at the date of issuance using the Black-Scholes option pricing model using the following assumptions: Common stock price 36.40 Dividend yield 0 % Risk-free interest rate 1.60 % Expected term (years) 10 Expected volatility 480 % The following table summarizes all stock option activity for the year ended December 31, 2021: Shares Weighted- Outstanding, December 31, 2020 10,401 $ 145.34 Granted 119,229 $ 36.40 Forfeited 7,692 $ 36.40 Outstanding, December 31, 2021 121,938 $ 47.97 The following table discloses information regarding outstanding and exercisable options at December 31, 2021: Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 186.55 6,093 $ 186,055 1.24 6,093 $ 186.55 97.50 2,769 97.50 1.71 2,769 97.50 67.99 1,538 67.99 2.24 1,538 67.99 36.40 111,538 36.40 9.84 60,385 36.40 121,938 $ 56.44 9.13 70,785 $ 55.12 As of December 31, 2022, 124,231 ordinary shares are reserved under the 2021 equity incentive plan. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 9 - STOCKHOLDERS’ EQUITY Common Stock Activity During the Year Ended December 31, 2022 The following summarizes the Common Stock activity for the year ended December 31, 2022: Outstanding Balance, December 31, 2021 1,151,207 Shares of Common Stock issued 324,928 Shares issued for services 7, 693 Treasury stock (10,183 ) Balance, December 31, 2021 1,473,645 On April 6, 2022, the Company issued 7,693 shares of its Common Stock pursuant to a Service Agreement between the Company and a service provider. The fair market value of the shares at the issuance date was $110. On August 4, 2022, the Company, entered into a Securities Purchase Agreement (“Purchase Agreement”) with an institutional investor (the “Purchaser”) pursuant to which the Purchaser agreed to purchase, and the Company agreed to issue and sell to the Purchaser in a private placement, an aggregate of 127,308 shares of the Company’s common stock, $0.001 par value, pre-funded warrants to purchase up to 197,620 shares of Common and warrants to purchase up to 324,928 shares of Common Stock. The purchase price per Share and associated Common Stock Warrant was $9.23 and the purchase price per Pre Funded Warrant and associated Common Stock Warrant was $9.23. Each Common Stock Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $7.67 per share. Each Pre Funded Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $0.0001 per share. The Common Stock Warrants are exercisable for a period of five years and six months commencing on the issuance date and the Pre Funded Warrants are exercisable until exercised. The Warrants also contain customary beneficial ownership limitations that may be waived at the option of each holder upon 61 days’ notice to the Company. The Private Placement closed on August 8, 2022. The gross proceeds to the Company, before deducting placement agent fees and other offering expenses, are approximately $3.0 million. On August 4, 2022, in connection with the Private Placement, the Company entered into a registration rights with the Purchaser, pursuant to which the Company agreed to file a registration statement with the Securities and Exchange Commission (the “SEC”) to register for resale the Shares and any shares of the Company’s common stock issuable upon exercise of the Warrants within 30 days of the signing of the Registration Rights Agreement, with such registration statement becoming effective within 60 days after the signing of the Registration Rights Agreement, subject to adjustment in the event of a review by the SEC. The Company is subject to customary penalties and liquidated damages in the event it does not meet certain filing requirements and deadlines set forth in the Registration Rights Agreement. Pursuant to an engagement agreement, H.C. Wainwright & Co., LLC (the “Placement Agent’) was engaged by the Company to act as its placement agent for the Private Placement. The Company agreed to pay the Placement Agent a cash fee equal to 7.0% of the gross proceeds received by the Company in the Private Placement, in addition to the reimbursement of certain expenses. The Company also agreed to issue to the Placement Agent warrants to purchase up to 22,745 shares of Common Stock, exercisable for a period of five years and six months commencing on the issuance date, at an exercise price of $11.54 per share. The fair market of those warrants was $165 thousand as of date of issuance. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Commitments and Contingencies [Abstract] | ||
COMMITMENTS AND CONTINGENCIES | NOTE 5 - COMMITMENTS AND CONTINGENCIES From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. On May 1, 2019, the Company received a notice of demand for arbitration from Secure IP Telecom, Inc. (“Secure IP), who allegedly had a Reciprocal Carrier Services Agreement (“RCS”) exclusively with Limecom and not with the Company. The arbitration demand originated from another demand for arbitration that Secure IP received from VoIP Capital International (“VoIP”) in March 2019, demanding $1,053 in damages allegedly caused by unpaid receivables that Limecom assigned to VoIP based on the RCS. On or about October 5, 2020, the trial court appointed a receiver over Limecom, Inc. (“ Limecom” th Secure IP Heritage On October 4, 2022, Crosshair Media Placement, LLC, a Kentucky based marketing company, filed and served a complaint on Cuentas for breach of contract alleging breach of contract damages of $630, which case remains pending in the United States District Court for the Western District of Kentucky, case no. 3:22-CV-512-CHB. The Company is vigorously defending itself against this complaint and on November 8, 2022, filed a Motion to Dismiss for Lack of Jurisdiction and a Motion to Change Venue. As of March 31, 2023, the company accrued $630 thousand due to this matter. On March 14, 2023, the Company was served with a complaint for Breach of Contract of an Employment Agreement in excess of $30. The Company has retained counsel and is aggressively defending its rights. On April 1, 2021 the Company executed a lease for office space effective April 1, 2021. The lease requires monthly rental payments of $9. | NOTE 10 - COMMITMENTS AND CONTINGENCIES From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. On May 1, 2019, the Company received a notice of demand for arbitration from Secure IP Telecom, Inc. (“Secure IP), who allegedly had a Reciprocal Carrier Services Agreement (“RCS”) exclusively with Limecom and not with the Company. The arbitration demand originated from another demand for arbitration that Secure IP received from VoIP Capital International (“VoIP”) in March 2019, demanding $1,053 in damages allegedly caused by unpaid receivables that Limecom assigned to VoIP based on the RCS. On or about October 5, 2020, the trial court appointed a receiver over Limecom, Inc. (“ Limecom” th Secure IP Heritage On May 25, 2022, the Company received a notice of default from CIMA Telecom, Inc. (“CIMA”) related to that certain Platform Exclusive License Agreement, maintenance, and related agreements by and among Cuentas, CIMA, Knetik, Inc., and Auris, LLC. The notice provides that Cuentas has failed to pay $700 of maintenance and pass-through fees that CIMA alleges are owed under the License Agreement and also afforded Cuentas the required sixty-day period (through July 24, 2022) to cure the default as provided under the License Agreement.. On August 2, 2022, the Company and CIMA, along with two of CIMA’s wholly-owned subsidiaries, Knetik, Inc. and Auris, LLCexecuted a Settlement Agreement and General Release which resolves the issues related to the July 8, 2022 notice of default from CIMA related to that certain Platform Exclusive License Agreement, maintenance, and related agreements by and among Cuentas, CIMA, Knetik, Inc., and Auris, LLC. The Parties executed Mutual General Releases and the settlement terms are as follows: In exchange for the consideration provided in the Settlement Agreement, (1) the Company paid CIMA $350on August 2, 2022 and (2) on or before 5:00 p.m New York City time, on August 15, 2022, Cuentas will pay CIMA the balance of the Unpaid Fees ($420.239) by wire transfer (3) Cuentas will a period of 30 days from execution date, the exclusive right to facilitate a third party (including to current shareholders and directors of Cuentas) purchase (without markup or broker fee) of, all of the shares of Cuentas held by CIMA at the higher of: (i) the average per share trading price for the three day average before notice in writing is provided by Cuentas of the intent to purchase CIMA’s Cuentas shares, or (ii) the minimum price of $0.50 per share on or before 5:00 p.m. New York City time, on August 31, 2022 pursuant to a purchase agreement delivered by and acceptable to CIMA without any changes thereto (provided, that CIMA shall not be required to provide any representations or warranties other than fundamental warranties related to (a) organization and good standing, (b) power and authority to undertake the transaction and (c) ownership of such shares, and ordinary representations and warranties that the Cuentas shares are being transferred free and clear of any liens, claims, or encumbrances); and (iv) on or before 5:00 p.m. New York City time, on August 2, 2022, Cuentas shall, and shall cause (x) Dinar Zuz, LLC, (y) Michael De Prado and (z) Arik Maimon to provide signed waiver letters, expressly waiving any right of first refusal and co-sale rights granted in their favor under that certain letter agreement, dated December 31, 2019, by and among CIMA, Dinar Zuz, LLC, Michael Del Prado and Arik Maimon, and (y) CIMA agrees: (i) to restore immediately Cuentas’ access to the Platform upon receipt of the $350 payment ; (ii) to provide Cuentas with a limited license to utilize the Platform the terms of which are detailed specifically in Section 6 of the agreement, and to use reasonable efforts, subject to Cuentas’ compliance hereto, to provide Cuentas’ customer data to Cuentas through the end of the limited license term described below in Section 6 of the agreement; (iii) deliver to Cuentas the Source Code (as that term is defined in paragraph 1.18 of the License Agreement) relating to Out-Of-Scope Services, and as further detailed in Section 6 of the agreement; (iv) not enforce its rights under the Side Letter (as that term is defined in the paragraph 1.1 of the Purchase Agreement) through and including August 31, 2022, and (v) shall not transfer, sell, or encumber its Cuentas shares through and including August 31, 2022, except as permitted herein. Cuentas acknowledges and agrees that the amount of Unpaid Fees ($770.239) is valid and outstanding, and waives any right to dispute them. If Cuentas fails to comply with any term of this Settlement Agreement, in addition to the Stipulated Judgment described in Section 5 of the agreement, the limited license set forth in Section 6 and any of CIMA’s obligations under this Settlement Agreement shall become null and CIMA shall have the right to shut off Cuentas access to the Platform without notice. The Settlement Agreement also provides for mutual general releases by Cuentas for the benefit of CIMA and by CIMA for the benefit of Cuentas of all claims other than claims relating to a breach of the Settlement Agreement. The settlement agreement by its terms in effect terminates the obligations under the license agreement, dated December 31, 2019 by and between Cuentas and CIMA. The Company did not exercise its exclusive right to facilitate a third party purchase of, all of the shares of Cuentas held by CIMA. As of December 31, 2022 the company fulfilled all its obligation under the settlement agreement. On October 4, 2022, Crosshair Media Placement, LLC, a Kentucky based marketing company, filed and served a complaint on Cuentas for breach of contract alleging breach of contract damages of $629,807.74, which case remains pending in the United States District Court for the Western District of Kentucky, case no. 3:22-CV-512-CHB. The Company is vigorously defending itself against this complaint and on November 8, 2022, filed a Motion to Dismiss for Lack of Jurisdiction and a Motion to Change Venue. On April 1, 2021 the Company executed a lease for office space effective April 1, 2021. The lease requires monthly rental payments of $7. |
Segments of operations
Segments of operations | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Segments of Operations [Abstract] | ||
SEGMENTS OF OPERATIONS | NOTE 6 - SEGMENTS OF OPERATIONS The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company’s reportable operating segments. The Company manages its business primarily on a product basis. The accounting policies of the various segments are the same as those described in Note 2, “Summary of Significant Accounting Policies.” The Company evaluates the performance of its reportable operating segments based on net sales and gross profit. Revenue by product for the three months ended March 31, 2023, and the three months ended March 31, 2022 are as follows: March 31, March 31, (dollars in thousands) Telecommunications $ 49 $ 175 Digital products and General Purpose Reloadable Cards 15 219 Total revenue $ 64 $ 394 Gross loss by product for the three months ended March 31, 2023, and the three months ended March 31, 2022 are as follows: March 31, March 31, (dollars in thousands) Telecommunications $ (7 ) $ 66 Digital products and General Purpose Reloadable Cards (52 ) (88 ) Total Gross Loss $ (59 ) $ (22 ) | NOTE 11 - SEGMENTS OF OPERATIONS The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company’s reportable operating segments. The Company manages its business primarily on a product basis. The accounting policies of the various segments are the same as those described in Note 2, “Summary of Significant Accounting Policies.” The Company evaluates the performance of its reportable operating segments based on net sales and gross profit. Revenue by product for 2022 and 2021 are as follows: December 31, December 31, (dollars in thousands) Telecommunications $ 839 $ 525 Digital products and General Purpose Reloadable Cards 2,155 68 Total revenue $ 2,994 $ 593 Gross profit (loss) by product for 2022 and 2021 are as follows : December 31, December 31, (dollars in thousands) Telecommunications $ 607 $ 212 Digital products and General Purpose Reloadable Cards (121 ) (88 ) Total revenue $ 486 $ 124 Long lived assets by product for 2022 and 2021 are as follows: December 31, December 31, (dollars in thousands) Telecommunications $ - $ - Digital products and General Purpose Reloadable Cards - 5,400 Total revenue $ - $ 5,400 For the year ended December 31, 2022 and December 31, 2021, the Company’s sales to Cuentas SDI LLC were approximately 72% and 10.5% of the Company’s total revenue, respectively for the years ended December 31, 2022 and December 31, 2021. All of the Company’s sales were generated in the U.S in 2022 and 2021. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes [Abstract] | |
INCOME TAXES | NOTE 12 - INCOME TAXES Internal Revenue Code Section 382 (“IRC 382”) potentially limits the utilization of NOLs and tax credits when there is a greater than 50% change of ownership. The Company has not performed an analysis under IRC 382 related to changes in ownership, which could place certain limits on the company’s ability to fully utilize its NOLs and tax credits. The Company’s has added a note to its financial statements to disclose that there may be some limitations and that an analysis has not been performed. In the interim, the Company has placed a full valuation allowance on its NOLs and other deferred tax items. We recognized income tax benefits of $0 during the years ended December 31, 2022 and December 31, 2021. When it is more likely than not that a tax asset will not be realized through future income, the Company must allow for this future tax benefit. We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry forward period. The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements for the years ended December 31, 2022 or December 31, 2021 applicable under FASB ASC Topic 740. We did not recognize any adjustment to the liability for uncertain tax position and therefore did not record any adjustment to the beginning balance of accumulated deficit on the balance sheet. All tax returns for the Company remain open. Reconciliation between the theoretical tax expense, assuming all income is taxed at the statutory tax rate applicable to income of the Company and the actual tax expense as reported in the Statement of Operations, is as follows: Year ended 2022 2021 Loss before taxes, as reported in the consolidated statements of operations $ 14,479 $ 10,728 Federal and State statutory rate 26.5 % 26.5 % Theoretical tax benefit on the above amount at federal statutory tax rate 3,837 2,842 Permanent differences (1,854 ) (1,180 ) Losses and other items for which a valuation allowance was provided or benefit from loss carry forward (1,983 ) (1,662 ) Actual tax income (expense) - - 2022 2021 U.S. dollars in Deferred tax assets: Net operating loss carry-forward $ 8,165 $ 5,464 Adjustments (1,118 ) (1,015 ) Valuation allowance (7,047 ) (4,449 ) $ - $ - A valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. Management has determined, based on its recurring net losses, lack of a commercially viable product and limitations under current tax rules, that a full valuation allowance is appropriate. U.S. Valuation allowance, December 31, 2021 $ 4,449 Increase 2,598 Valuation allowance, December 31, 2022 $ 7,047 The net federal operating loss carry forward will begin expire in 2039. This carry forward may be limited upon the consummation of a business combination under IRC Section 382. |
Subsequent Events
Subsequent Events | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Subsequent Events [Abstract] | ||
SUBSEQUENT EVENTS | NOTE 7 - SUBSEQUENT EVENTS On April 14, 2023, the Nasdaq Listing Qualifications Staff (the “Staff”) issued the Company a compliance letter citing that the Company regained compliance with the bid price concern, as required by the Hearing Panel’s (“Panel”) decision dated February 23, 2023. On April 13, 2023, the Company signed an Operating Agreement to be a majority member in Brooksville Development Partners, LLC (“Brooksville”) with 2 minority members for the purpose of acquiring land for the development of a residential apartment community consisting of approximately 360 apartments. All real and personal property owned by Brooksville shall be owned by Brooksville as an entity, . One of the minority members is qualified and will be the manager of the project. On April 28, 2023, the Company and minority partners in Brooksville closed on the transaction to acquire a 21.8 acre site for development of the Brooksville project for total purchase price of $5,050. Cuentas had deposited an “Initial Capital Contribution” of $2,000 into a title insurance escrow account which was released from escrow by the Title Agent to fund the balance of the purchase price of the Vacant Land, together with a $3,050 bank loan from Republic Bank of Chicago. Brooksville owns the Vacant Land, free and clear of any liens, claims and encumbrances with the sole exception being the Republic Bank loan. The Company is currently a 63% interest holder in Brooksville but that may change in the future if the Company is not able to raise sufficient financing to complete the project. | NOTE 13 - SUBSEQUENT EVENTS On January 5, 2023, the Company entered into a Binding Letter of Intent with Core Development Holdings Corporation (“Core”), a Florida corporation that holds approximately 29.3% of 4280 Lakewood Road Manager, LLC (“Lakewood Manager”), which in turn owns 86.45% of the membership interests in 4280 Lakewood Road, LLC (“4280 Project”), an affordable multi-family real estate project located in Lake Worth, Florida. Core has agreed to sell a portion of its interest in the Lakewood Manager to the Company and the Company has agreed to issue to Core a number of the Company’s common shares to acquire $2 million of equity in the Lakewood Manager . The Company has agreed to issue to Core a number of the Company’s common shares equal to 33.3% of the total number of post- issuance, authorized, issued and outstanding shares on a fully diluted basis measured on a going forward basis to account for the exercise in the future of any currently issued and outstanding warrants and options as of the date of the agreement, of the Company’s stock free and clear of any liens, claims or encumbrances. If for any reason, the Company is unable to issue sufficient shares to satisfy the 33.3% Ownership Percentage or as a result of the exercise and issue of any stock warrants or options outstanding as of the date of the Agreement, the Percentage Membership Interest to be issued by Core to Cuentas pursuant to the Letter of Intent shall be reduced by the same percentage that the actual post-issuance ownership percentage falls below the 33.3% Ownership Ratio. The Percentage of Membership Interest Acquired will be determined by selection of two competent valuation professionals, one by each Party, to prepare a written opinion of the fair market value of Core’s Interest in Lakewood Managers as of the Closing Date provided that, the difference between two appraisals does not exceed 15%, then the average of the fair market value of the two appraisals shall represent the “Appraised Value Denominator” for purposes of determining the Percentage Membership Interest to be transferred by Core to the Company. If the difference between two appraisals is more than 15%, then the Parties shall mutually select a third competent valuation expert who shall prepare a third opinion of the fair market value of Core’s Interest in Lakewood Manager, and the average of the three opinions of the fair market value of Core’s Interest in Lakewood Manager shall be the Appraised Value Denominator. The Percentage Membership Interest to be assigned and transferred shall equal the Purchase Price divided by the Appraised Value Denominator. Core’s transfer of the Percentage Membership Interest is subject to approval by Lakewood Manager. The Company agreed to be bound by the rights and obligations of the current Operating Agreement and other agreements of Lakewood Manager and Core shall have the right continue to exercise its management and other decision making rights at Lakewood Manager and will provide customary rights afforded minority interest holders in limited liability companies provided under Florida law. The Company’s obligation to consummate and enter into a definitive purchase and sale agreement is contingent on board of director and shareholder approval. On February 3, 2023, the Company (“Cuentas” or “Buyer”) entered into a Membership Interest Purchase Agreement (MIPA) with Core. Core has agreed to sell 6% of its interest in the Lakewood Manager to Cuentas and Cuentas has agreed to issue to Core 295,282 of the Company’s common shares to acquire the 6% equity in the Lakewood Manager valued at $1,195,195. The 295,282 of the Company’s share was equal to 19.9% of the total number of current issued and outstanding shares of the Company as of the date of this Agreement. The Company closed this transaction on or about March 9th, 2023. As previously disclosed, on June 21, 2022, the Nasdaq Listing Qualifications Staff (the “Staff”) issued the Company a delist letter citing its failure to comply with the minimum bid price requirement under Listing Rule 5550(a)(2). In accordance with Listing Rule 5810(c)(3)(A), the Company was provided 180 calendar days, or until December 19, 2022, to regain compliance with Rule 5550(a)(2). On December 20, 2022, Staff notified the Company that it had determined to delist the Company as it did not comply with bid price requirement for listing on the Exchange. On December 27, 2022, the Company requested a hearing, which was held on February 9, 2023. On February 28, 2023, the Company announced that it received on February 23 formal notification from The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Nasdaq Hearings Panel (the “Panel”) had determined to grant the Company’s request for continued listing on The Nasdaq Capital Market, pursuant to an extension through April 6, 2023, to evidence compliance with Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”). Such extension is subject to the conditions that (1) on or before March 23, 2023, the Company shall effect a reverse stock split at a ratio that is sufficient to ensure compliance with the Bid Price Rule and (2) on April 6, 2023, the Company shall have demonstrated compliance with the Bid Price Rule, by evidencing a closing bid price of $1 or more per share for a minimum of ten consecutive trading sessions. The Company is taking definitive steps to timely evidence compliance with the terms of the Panel’s decision; however, there can be no assurance that it will be able to do so by April 6, 2023, or that the Panel will grant a further extension if required. On March 9, 2023 the Board of Directors of the Company approved an annual Incentive of $150,000 for Michael De Prado for fiscal year 2022 and $150,000 for Arik Maimon for fiscal year 2022. Those annual Incentives were paid on March 10, 2023. On March 9, 2023 the Board of Directors of the Company approved an annual Incentive of $150,000 for Michael De Prado for fiscal year 2022 and $150,000 for Arik Maimon for fiscal year 2022. Those annual Incentives were paid on March 10, 2023. On March 9, 2023, the Board of Directors of the Company approved a Retention Bonus to be included in the negotiation of an employment agreement or amended employment agreement for Shalom Arik Maimon and Michael De Prado. On February 6, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an institutional investor (the “Investor”) for the purpose of raising approximately $5 million in gross proceeds for the Company. Pursuant to the terms of the Purchase Agreement, the Company agreed to sell, in a registered direct offering, an aggregate of (i) 2,123,478 shares (the “Shares”) of the Company’s common stock (“Common Stock”) and (ii) pre-warrants to purchase up to 1,664,401 shares of Common Stock (the “Pre-Funded Warrants” and such shares of Common Stock issuable upon exercise of the Pre-Funded Warrants, the “Pre-Funded Warrant Shares”) and, in a concurrent private placement, warrants (the “Purchase Warrants”) to purchase 3,787,879 shares of Common Stock (the shares of Common Stock issuable upon exercise of the Purchase Warrants, the “Purchase Warrant Shares”). The combined purchase price per Share and Purchase Warrant is $1.32 and the combined purchase price per Pre-Funded Warrant and Purchase Warrant of $1.3199. The Pre-Funded Warrants were sold, in lieu of shares of Common Stock, to any Investor whose purchase of shares of Common Stock in the Registered Offering would otherwise result in such Investor, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at such Investor’s option upon issuance, 9.99%) of the Company’s outstanding Common Stock immediately following the consummation of the Registered Offering. Each Pre-Funded Warrant represents the right to purchase one share of Common Stock at an exercise price of $0.0001 per share. The Pre-Funded Warrants are exercisable immediately and may be exercised at any time until the Pre-Funded Warrants are exercised in full. The Purchase Warrants will be exercisable on the six-month anniversary of the issuance date and will expire five and one-half years following the date of issuance at an exercise price of $1.335 per share. The closing of the sales of these securities under the Purchase Agreement occurred on or about February 8, 2023, subject to satisfaction of customary closing conditions. H.C. Wainwright & Co., LLC (“Wainwright”) is acting as exclusive placement agent for the offering pursuant to an engagement agreement between the Company and Wainwright dated as of December 13, 2022. As compensation for such placement agent services, the Company has agreed to pay Wainwright an aggregate cash fee equal to 7.0% of the gross proceeds received by the Company from the offering, plus a management fee equal to 1.0% of the gross proceeds received by the Company from the offerings, a non-accountable expense of $65,000 and $15,950 for clearing expenses. The Company has also agreed to issue to Wainwright or its designees warrants to purchase 265,152 shares of Common Stock (the “PA Warrants” and the shares of Common Stock issuable upon exercise of the PA Warrants, the “PA Warrant Shares”). The PA Warrants have a term of five years from the commencement of sales in the offering, and have an exercise price of $1.782 per share. The net proceeds to the Company from the registered direct offering and concurrent private placement, after deducting the Placement Agent’s fees and expenses and the Company’s offering expenses are expected to be approximately $4.3 million. On March 16, 2023, the Company issued 15,385 shares of its Common Stock pursuant to a Settlement between the Company and a service provider. The fair market value of the shares at the issuance date was $112. On March 27, 2023, the Company issued 27,759 shares of its Common Stock pursuant to a Service Agreement between the Company and a service provider. The fair market value of the shares at the issuance date was $112. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | ||
Use of Estimates | Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“‘US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. As applicable to the consolidated financial statements, the most significant estimates and assumptions relate to allowances for impairment of intangible assets and fair value of stock-based compensation and fair value calculations related to embedded derivative features of outstanding convertible notes payable. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements are prepared in accordance with US GAAP. The consolidated financial statements of the Company include the Company and its wholly owned and majority-owned subsidiaries. All inter-company balances and transactions have been eliminated. | Principles of consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Functional currency | Functional currency The functional currency of the company and its subsidiaries is U.S dollar. | |
Reclassification of Prior Year Presentation | Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. | |
Cash and cash equivalents | Cash and cash equivalents The Company considers all short-term investments, which are highly liquid investments with original maturities of three months or less at the date of purchase, to be cash equivalents. | |
Allowance for credit losses | Allowance for credit losses The Company adopted the Current Expected Credit Losses (“CECL”) guidance effective January 1, 2020. The Company maintains the allowance for estimated losses resulting from the inability of the Company’s customers to make required payments. The allowance represents the current estimate of lifetime expected credit losses over the remaining duration of existing accounts receivable considering current market conditions and supportable forecasts when appropriate. The estimate is a result of the Company’s ongoing evaluation of collectability, customer creditworthiness, historical levels of credit losses, and future expectations. Changes in the allowance for credit losses are recognized in, general and administrative expenses. Accounts receivables are written-off against the allowance for credit losses when management deems the accounts are no longer collectible. There was an allowance for doubtful accounts of $177 and $20 as of December 31, 2022 and 2021. | |
Leases | Leases The Company accounts for leases in accordance with ASC 842, The Company determines if an arrangement is a lease at inception. Balances related to operating leases are included in operating lease right-of-use (“ROU”) assets, current maturities of operating leases liabilities and Non-current operating leases liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized as of the commencement date based on the present value of lease payments over the lease term. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The discount rate for the lease is the rate implicit in the lease unless that rate cannot be readily determined. As the Company’s leases do not provide an implicit rate, the Company’s uses its estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term , As of December 31, 2022 the Company has lease agreement of less than 12 months. | |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. The Company provides for depreciation and amortization using the straight-line method over the estimated useful lives of the related assets, which range from three to five years. | |
Variable Interest Entities | Variable Interest Entities The Company account for variable interest entities in accordance with ASC Topic 810, Consolidation | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company’s long-lived assets, such as property, plant and equipment and identifiable intangible assets, are reviewed for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment indicators which could trigger an impairment may include, among others, any significant changes in the manner of our use of the assets or the strategy of our overall business, certain reorganization initiatives, significant negative industry, or economic trends or when we conclude that it is more likely than not that an asset will be disposed of or sold. Long-lived assets are reviewed for impairment in accordance with ASC No. 360, “Property, Plant and Equipment,” whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. This measurement includes significant estimates and assumptions inherent in the estimate of the fair value of identifiable intangible assets. Newly acquired and recently impaired indefinite-lived assets are more vulnerable to impairment as the assets are recorded at fair value and are then subsequently measured at the lower of fair value or carrying value annually or when triggering events are present. As such, immediately after acquisition or impairment, even small declines in the outlook for these assets can negatively impact on our ability to recover the carrying value and can result in an impairment charge. The Company did not record impairment losses during the year ended December 31, 2021. The Company recorded impairment losses in the amount of $3,600 thousand during the year ended December 31, 2022. | |
Derivative and Fair Value of Financial Instruments | Derivative and Fair Value of Financial Instruments Fair value of certain of the Company’s financial instruments including cash, accounts receivable, accounts payable, accrued expenses, notes payables, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of March 31, 2022 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 1 - - 1 Total liabilities 1 - - 1 Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities - - - - Total liabilities - - - - | Derivative Liabilities and Fair Value of Financial Instruments Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments and measurement of their fair value for accounting purposes. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt under ASC Topic 470, the Company will continue its evaluation process of these instruments as derivative financial instruments under ASC Topic 815. Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. Fair value of certain of the Company’s financial instruments including cash, accounts receivable, account payable, accrued expenses, notes payables, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC Topic 820, “Fair Value Measurements and Disclosure” Fair value, as defined in ASC Topic 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC Topic 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC Topic 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), (ii) segregating those gains or losses included in earnings and (iii) a description of where those gains or losses included in earning are reported in the statement of income. The Company records a debt discount related to the issuance of convertible debts that have conversion features at adjustable rates. The debt discount for the convertible instruments is recognized and measured by allocating a portion of the proceeds as an increase in additional paid-in capital and as a reduction to the carrying amount of the convertible instrument equal to the fair value of the conversion features. The debt discount will be accreted by recording additional non-cash gains and losses related to the change in fair values of derivative liabilities over the life of the convertible notes. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Marketable securities - - - - Total assets - - - - Liabilities: Stock based liabilities - - - - Total liabilities - - - - Balance as of December 31, 2021 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 3 - - 3 Total liabilities 3 - - 3 |
Deferred Revenue | Deferred Revenue Deferred revenue is comprised mainly of unearned revenue related to prepayments from retail consumers for telecommunications minutes. The following table represents the changes in deferred revenue for the three months ended March 31, 2023: Deferred Balance at December 31, 2022 $ 113 Change in deferred revenue (4 ) Balance at March 31, 2023 $ 109 Revenue allocated to remaining performance obligations represent contracted revenue that has not yet been recognized (“contracted not recognized”). Contracted not recognized revenue was $109 as of March 31, 2023, of which the Company expects to recognize 100% of the revenue over the next 12 months. | Deferred Revenue The Company records deferred revenue for any upfront payments received in advance of the Company’s performance obligations being satisfied. These contract liabilities consist principally of unearned new minutes fees. Changes in the deferred revenue balance are driven primarily by the amount of new minutes fees recognized during the period, and the degree to which these reductions to the deferred revenue balance are offset by the deferral of new minutes fees associated with minutes sold during the period. |
Non-Controlling Interest | Non-Controlling Interest The Company reports the non-controlling interest in its majority owned subsidiaries in the consolidated balance sheets within the stockholders’ deficit section, separately from the Company’s stockholders’ deficit. Non-controlling interest represents the non-controlling interest holders’ proportionate share of the equity of the Company’s majority-owned subsidiaries. Non-controlling interest is adjusted for the non-controlling interest holders’ proportionate share of the earnings or losses and other comprehensive income (loss) and the non-controlling interest continues to be attributed its share of losses even if that attribution results in a deficit non-controlling interest balance. | |
Revenue Recognition | Revenue Recognition The Company follows paragraph 605-10-S99 of the FASB Accounting Standards Codification for revenue recognition. The Company will recognize revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable and (iv) collectability is reasonably assured. The Company primarily generates revenues through the brokering of sales of minutes from one telecommunications carrier to another and to a lesser extent the sales of prepaid calling minutes to consumers through its Tel3 division. While the Company collects payment for such minutes in advance, revenue is recognized upon delivery to and consumption of minutes by the consumer. Minutes are forfeited buy the consumer after twelve consecutive months of non-use at which point the Company recognizes revenue from the forfeiture of prepaid minutes. The Company is also recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (ASC 606), when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expect to receive in exchange for those goods or services. To determine whether arrangements are within the scope of ASC 606, the Company perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies its performance obligation. The Company apply the five-step model to contracts when it is probable that the Company will collect the consideration the Company are entitled to in exchange for the goods or services the Company transfer to the customer. At contract inception, once the contract is determined to be within the scope of this guidance, the Company assessed the goods or services promised within each contract and identify, as a performance obligation, and assess whether each promised good or service is distinct. The Company then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. | |
Business Segments | Business Segments The Company operates in a two-business segments of telecommunications and General Purpose Reloadable Cards. | |
Income Taxes | Income Taxes Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code Section 382 if a change of ownership occurs. | |
Net Loss Per Basic and Diluted Common Share | Net Loss Per Basic and Diluted Common Share Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity. At December 31, 2022, potentially dilutive securities consisted of 615,063 shares which of 128,477 options to purchase of common stock at prices ranging from $36.40 to $186.55 per share and 486,587 warrants to purchase of common stock at prices ranging from $7.67 to $260.00 per share. The effects of these options and warrants been excluded as the conversion would be anti-dilutive due to the net loss incurred in the year ended December 31, 2022. At December 31, 2021, potentially dilutive securities consisted of 260,854 shares which of 121,938 options to purchase of common stock at prices ranging from $36.40 to $186.55 per share and 138,915 warrants to purchase of common stock at prices ranging from $55.90 to $260.00 per share. The effects of these options and warrants been excluded as the conversion would be anti-dilutive due to the net loss incurred in the year ended December 31, 2021. | |
Advertising Costs | Advertising Costs The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred $1 and $37 of advertising costs during the years ended December 31, 2022 and 2021, respectively. | |
Stock-Based Compensation | Stock-Based Compensation The Company applies ASC Topic 718-10, “Share-Based Payment,” which requires the measurement and recognition of compensation expenses for all share-based payment awards made to employees and directors (including employee stock options under the Company’s stock plans) based on estimated fair values. ASC Topic 718-10 requires companies to estimate the fair value of equity-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s statement of operations. The Company recognizes compensation expenses for the value of non-employee awards based on the straight-line method over the requisite service period of each award, net of estimated forfeitures. The Company estimates the fair value of stock options granted as equity awards using a Black-Scholes options pricing model. The option-pricing model requires a number of assumptions, of which the most significant are share price, expected volatility and the expected option term (the time from the grant date until the options are exercised or expire). Expected volatility is estimated based on volatility of similar companies in the technology sector. The Company has historically not paid dividends and has no foreseeable plans to issue dividends. The risk-free interest rate is based on the yield from governmental zero-coupon bonds with an equivalent term. The expected option term is calculated for options granted to employees and directors using the “simplified” method. Grants to non-employees are based on the contractual term. Changes in the determination of each of the inputs can affect the fair value of the options granted and the results of operations of the Company. | |
Related Parties | Related Parties The registrant follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions. Pursuant to Section 850-10-20 of the FASB Accounting Standards Codification, the Related parties include (a) affiliates of the registrant; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825-10-15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the registrant; (e) management of the registrant; (f) other parties with which the registrant may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This updated guidance sets forth a current expected credit loss model based on expected losses. Under this model, an entity recognizes an allowance for expected credit losses based on historical experience, current conditions and forecasted information rather than the current methodology of delaying recognition of credit losses until it is probable a loss has been incurred. This guidance becomes effective for the Company beginning in interim periods starting in fiscal year 2023. The impact of adopting the new standard did not have a material impact on the Company’s consolidated financial statements. Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our financial statements upon adoption. | Recently Issued Accounting Standards Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging and Topic 825, Financial Instruments Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our financial statements upon adoption. |
Unaudited Interim Financial Statements | Unaudited Interim Financial Statements The accompanying unaudited consolidated financial statements include the accounts of the Company and its subsidiaries, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, the financial statements presented herein have not been audited by an independent registered public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the for three-months ended March 31, 2023. However, these results are not necessarily indicative of results for any other interim period or for the year ended December 31, 2023. The preparation of financial statements in conformity with GAAP requires the Company to make certain estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues, and expenses. Actual amounts could differ from these estimates. Certain information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission (“SEC”). The accompanying unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 31, 2023 (the “Annual Report”). For further information, reference is made to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Basis of Presentation (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | ||
Schedule of financial assets and liabilities are measured at fair value on a recurring basis | Balance as of March 31, 2022 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 1 - - 1 Total liabilities 1 - - 1 Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities - - - - Total liabilities - - - - | Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Marketable securities - - - - Total assets - - - - Liabilities: Stock based liabilities - - - - Total liabilities - - - - Balance as of December 31, 2021 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 3 - - 3 Total liabilities 3 - - 3 |
Schedule of financial assets and liabilities are measured at fair value on a recurring basis | Deferred Balance at December 31, 2022 $ 113 Change in deferred revenue (4 ) Balance at March 31, 2023 $ 109 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets [Abstract] | |
Schedule of intangible assets | Asset Amount Life Intangible Assets $ 9,000 60 Total $ 9,000 60 Asset Amount Life Intangible Assets $ 47 60 Total $ 47 60 |
Schedule of amortization of intangible assets | Year ended December 31, 2023 $ 10 2024 10 2025 8 Total $ 28 |
Other Accounts Liabilities (Tab
Other Accounts Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Accounts Liabilities [Abstract] | |
Schedule of other accounts accrued liabilities | December 31, December 31, Accrued expenses, interest and other liabilities $ 309 $ 1,063 Accrued salaries and wages 105 63 Accrued bonuses 267 - Total $ 681 $ 1,126 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Related Party Transactions [Abstract] | ||
Schedule of due from related parties | March 31, December 31, (dollars in thousands) Arik Maimon (Chairman of the Board and the CEO) 42 - Michael De Prado (Vice Chairman of the Board and President) 46 - SDI Cuentas LLC, net of allowance for credit losses of $157 as of March 31, 2023 and December 31,2022, respectively. 210 198 Total Due from related parties 298 198 | December 31, December 31, (dollars in thousands) SDI Cuentas LLC, net of allowance for credit losses of $157 and $0 as of December 31, 2022 and December 31,2021, respectively. 198 1 Total Due from related parties 198 1 December 31, December 31, (dollars in thousands) (a) Due to Cima Telecom Inc. $ - 250 Total Due from related parties $ - $ 250 (a) Composed from annual fees in the amount of $250 for the maintenance and support services in accordance with the software maintenance agreement for the second calendar year from the Effective Date and other software development services. |
Schedule of related party transactions | Period ends at Period ends at (dollars in thousands) Sales to SDI Cuentas LLC $ 12 $ 214 Carol Pepper (b) - 40 Cima Telecom Inc. (a) $ - 324 $ - $ 364 (a) Composed of periodic fees in the amount of $177 thousand for the maintenance and support services in accordance with the software maintenance agreement for the first quarter of the third calendar year and $147 thousand for software development services during the first quarter of 2022. (b) Composed of a consulting fee in addition to the directorship fees. | Year Year (dollars in thousands) Sales to SDI Cuentas LLC $ 2,052 $ 62 Consulting fees to Angelo De Prado (a) 6 - Consulting fees to Sima Maimon Bakhar (b) 10 - Doubtful accounts - Cuentas SDI LLC 157 - Consulting fees to Carol Pepper (d) - 40 Cima Telecom Inc. (c) $ 918 840 $ 1,051 $ 880 (a) Angelo De Prado is the son of Michael De Prado. (b) Sima Maimon Bakhar is the wife of Aril Maimon. (c) Composed of periodic fees in the amount of $700 thousand for the maintenance and support services in accordance with the software maintenance agreement and the Settlement Agreement and General Release dated August 2, 2022 and $500 for the first half of the second calendar year from the effective date of the agreement, $218 thousand for software development and other services during 2022 and $340 thousand for software development and other services during 2022. Refer to note 10. The maintenance and support services and most of the software development and other services were recorded in cost of goods sold in the Digital products and General-Purpose Reloadable Cards segment. (d) Composed of consulting fee in additional to the directorship fees. |
Stock Options (Tables)
Stock Options (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Stock Options [Abstract] | ||
Schedule of summarizes all stock option activity | Shares Weighted- Outstanding, December 31, 2022 128,477 $ 56.44 Granted - - Forfeited 6,093 186.55 Outstanding, March 31, 2023 122,384 $ 49.96 | Shares Weighted- Outstanding, December 31, 2021 121,938 $ 47.97 Granted 38,461 36.40 Forfeited (31,922 ) 36.40 Outstanding, December 31, 2022 128,477 $ 56.44 Shares Weighted- Outstanding, December 31, 2020 10,401 $ 145.34 Granted 119,229 $ 36.40 Forfeited 7,692 $ 36.40 Outstanding, December 31, 2021 121,938 $ 47.97 |
Schedule of table discloses information regarding outstanding and exercisable options | Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 97.50 2,769 97.50 0.46 2,769 97.50 67.99 1,538 67.99 0.99 1,538 67.99 36.40 118,077 36.40 8.68 110,382 36.40 122,384 $ 49.96 8.38 114,689 $ 38.30 Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 186.55 6,093 $ 186.55 0.99 6,093 $ 186.55 97.50 2,769 97.50 1.46 2,769 97.50 67.99 1,538 67.99 1.99 1,538 67.99 36.40 126,923 36.40 9.59 53,846 36.40 137,323 $ 47.97 8.88 64,246 $ 54.08 | Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 186.55 6,093 $ 186.55 0.24 6,093 $ 186.55 97.50 2,769 97.50 0.71 2,769 97.50 67.99 1,538 67.99 1.24 1,538 67.99 36.40 118,077 36.40 8.88 110,382 36.40 128,477 $ 56.42 8.14 120,782 $ 45.78 Outstanding Exercisable Exercise Prices Number of Weighted Weighted Number of Weighted $ 186.55 6,093 $ 186,055 1.24 6,093 $ 186.55 97.50 2,769 97.50 1.71 2,769 97.50 67.99 1,538 67.99 2.24 1,538 67.99 36.40 111,538 36.40 9.84 60,385 36.40 121,938 $ 56.44 9.13 70,785 $ 55.12 |
Schedule of black-scholes option pricing model | Common stock price 2.366 Dividend yield 0 % Risk-free interest rate 3.88 % Expected term (years) 10 Expected volatility 454 % Common stock price 8.71 Dividend yield 0 % Risk-free interest rate 2.98 % Expected term (years) 10 Expected volatility 480 % Common stock price 13.91 Dividend yield 0 % Risk-free interest rate 1.79 % Expected term (years) 10 Expected volatility 197 % Common stock price 36.40 Dividend yield 0 % Risk-free interest rate 1.60 % Expected term (years) 10 Expected volatility 480 % | |
Schedule of stock options to executives’ officers and non-employee directors | Name Number of Exercise Vesting Schedule Jeffery D Johnson 38,462 $ 36.40 9,616 on grant date. 14,423 on each of the next 2 Employment Anniversaries. Shalom Arik Maimon 15,385 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Michael DePrado 11,538 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Ran Daniel 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Richard Berman 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Yochanon Bruk 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Jeff Lewis 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date David Schottenstein 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Adiv Baruch 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date Carol Pepper 7,692 $ 36.40 50% on grant date; 50% on 12 month anniversary of grant date |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity [Abstract] | |
Schedule of common stock activity | Outstanding Balance, December 31, 2021 1,151,207 Shares of Common Stock issued 324,928 Shares issued for services 7, 693 Treasury stock (10,183 ) Balance, December 31, 2021 1,473,645 |
Segments of operations (Tables)
Segments of operations (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Segments of Operations [Abstract] | ||
Schedule of revenue by product | March 31, March 31, (dollars in thousands) Telecommunications $ 49 $ 175 Digital products and General Purpose Reloadable Cards 15 219 Total revenue $ 64 $ 394 March 31, March 31, (dollars in thousands) Telecommunications $ (7 ) $ 66 Digital products and General Purpose Reloadable Cards (52 ) (88 ) Total Gross Loss $ (59 ) $ (22 ) | December 31, December 31, (dollars in thousands) Telecommunications $ 839 $ 525 Digital products and General Purpose Reloadable Cards 2,155 68 Total revenue $ 2,994 $ 593 December 31, December 31, (dollars in thousands) Telecommunications $ 607 $ 212 Digital products and General Purpose Reloadable Cards (121 ) (88 ) Total revenue $ 486 $ 124 December 31, December 31, (dollars in thousands) Telecommunications $ - $ - Digital products and General Purpose Reloadable Cards - 5,400 Total revenue $ - $ 5,400 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes [Abstract] | |
Schedule of actual tax expense | Year ended 2022 2021 Loss before taxes, as reported in the consolidated statements of operations $ 14,479 $ 10,728 Federal and State statutory rate 26.5 % 26.5 % Theoretical tax benefit on the above amount at federal statutory tax rate 3,837 2,842 Permanent differences (1,854 ) (1,180 ) Losses and other items for which a valuation allowance was provided or benefit from loss carry forward (1,983 ) (1,662 ) Actual tax income (expense) - - |
Schedule of deferred tax assets | 2022 2021 U.S. dollars in Deferred tax assets: Net operating loss carry-forward $ 8,165 $ 5,464 Adjustments (1,118 ) (1,015 ) Valuation allowance (7,047 ) (4,449 ) $ - $ - |
Schedule of valuation allowance | U.S. Valuation allowance, December 31, 2021 $ 4,449 Increase 2,598 Valuation allowance, December 31, 2022 $ 7,047 |
Organization and Description _2
Organization and Description of Business (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||||||
Feb. 06, 2023 USD ($) $ / shares shares | Feb. 03, 2023 | Aug. 08, 2022 USD ($) | Aug. 04, 2022 USD ($) $ / shares shares | Jul. 27, 2022 | May 27, 2022 USD ($) | Jun. 30, 2021 USD ($) shares | Feb. 02, 2021 $ / shares | Feb. 02, 2021 $ / shares | Mar. 23, 2023 | Dec. 30, 2022 $ / shares shares | Sep. 21, 2005 | Mar. 31, 2023 USD ($) $ / shares | Dec. 31, 2022 USD ($) shares | Apr. 28, 2023 USD ($) | Apr. 08, 2023 | May 17, 2022 $ / shares | Feb. 01, 2022 $ / shares | |
Organization and Description of Business (Details) [Line Items] | ||||||||||||||||||
Cuentas SDI network of over bodegas | 31,000 | 31,000 | ||||||||||||||||
Cuentas accountholders expenses | $ 500 | $ 500 | ||||||||||||||||
Ownership percentage in subsidiaries | 80.01% | 100% | ||||||||||||||||
Loan amount loss | $ 100 | |||||||||||||||||
Additional purchase price | $ 2,459,000 | |||||||||||||||||
Gross revenues percentage | 40% | |||||||||||||||||
Acquire interests percentage | 80.01% | |||||||||||||||||
Reverse stock split, description | As a result of the reverse stock split, the following changes have occurred (i) every thirteen shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option or common stock warrant have been proportionately decreased on a 13-for-1 basis, and the exercise price of each such outstanding stock option and common warrant has been proportionately increased on a 13-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 13-for-1 reverse stock split. | As a result of the reverse stock split, the following changes have occurred (i) every thirteen shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option or common stock warrant have been proportionately decreased on a 13-for-1 basis, and the exercise price of each such outstanding stock option and common warrant has been proportionately increased on a 13-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 13-for-1 reverse stock split. | ||||||||||||||||
Cash and cash equivalents | 3,328 | $ 466 | ||||||||||||||||
Working capital | 1,468 | 1,445 | ||||||||||||||||
Accumulated deficit | 2,879 | 724 | ||||||||||||||||
Accumulated deficit | $ 54,445 | $ 52,750 | ||||||||||||||||
License agreement, description | The Company has also agreed to issue to Wainwright or its designees warrants to purchase 20,397 shares of Common Stock (the “PA Warrants” and the shares of Common Stock issuable upon exercise of the PA Warrants, the “PA Warrant Shares”). | Pursuant to the Underwriting Agreement, the Company also agreed to issue to Maxim warrants (the “Underwriter’s Warrants”) to purchase up to a total of 17,174 shares of Common Stock (8% of the shares of Common Stock sold in the Offering). | ||||||||||||||||
Offering exercise price per share (in Dollars per share) | $ / shares | $ 11.54 | $ 36.4 | $ 36.4 | $ 36.4 | ||||||||||||||
Common stock term | 5 years | 5 years | ||||||||||||||||
Offering cost | $ 1,400 | |||||||||||||||||
Warrants issued (in Shares) | shares | 22,745 | |||||||||||||||||
Exercised offering shares (in Shares) | shares | 7,692 | |||||||||||||||||
Purchase agreement description | the Company entered into a Membership Interest Purchase Agreement (MIPA) with Core Development Holdings Corporation (“Core”). Core is a Florida corporation that holds approximately 29.3% of 4280 Lakewood Road Manager, LLC (“Lakewood Manager”), which in turn owns 86.45% of the membership interests in 4280 Lakewood Road, LLC (“4280 Project”), an affordable multi-family real estate project located in Lake Worth, Florida. Core sold 6% of its interest in the Lakewood Manager to the Company and the Company has agreed to issue to Core 295,282 of the Company’s common shares to acquire the 6% equity in the Lakewood Manager valued at approximately $700. The 295,282 of the Company’s shares were equal to 19.9% of the total number of issued and outstanding shares of the Company as of the date of the Agreement. The Company closed this transaction on or about March 9th, 2023 | the Company, entered into a Securities Purchase Agreement (“Purchase Agreement”) with an institutional investor (the “Purchaser”) pursuant to which the Purchaser agreed to purchase, and the Company agreed to issue and sell to the Purchaser in a private placement, an aggregate of 127,308 shares of the Company’s common stock, $0.001 par value, pre-funded warrants to purchase up to 197,620 shares of Common and warrants to purchase up to 324,928 shares of Common Stock. The purchase price per Share and associated Common Stock Warrant was $9.23 and the purchase price per Pre Funded Warrant and associated Common Stock Warrant was $9.23. Each Common Stock Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $7.67 per share. Each Pre Funded Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $0.0001 per share. The Common Stock Warrants are exercisable for a period of five years and six months commencing on the issuance date and the Pre Funded Warrants are exercisable until exercised. The Warrants also contain customary beneficial ownership limitations that may be waived at the option of each holder upon 61 days’ notice to the Company. The Private Placement closed on August 8, 2022. | ||||||||||||||||
Offering expenses | $ 3,000 | $ 4,300 | ||||||||||||||||
Gross proceeds percentage | 7% | |||||||||||||||||
Exercisable period | 5 years | |||||||||||||||||
Bank loan | $ 3,050 | |||||||||||||||||
Gross proceeds | $ 5,000,000 | |||||||||||||||||
Common stock shares (in Shares) | shares | 163,344 | 265,152 | ||||||||||||||||
Pre-warrants shares (in Shares) | shares | 128,031 | |||||||||||||||||
Purchase shares (in Shares) | shares | 291,375 | |||||||||||||||||
Purchase price per Share (in Dollars per share) | $ / shares | $ 17.16 | |||||||||||||||||
Purchase warrant price per share (in Dollars per share) | $ / shares | $ 17.16 | |||||||||||||||||
Related parties percentage | 4.99% | |||||||||||||||||
Investor percentage | 9.99% | |||||||||||||||||
Exercise price per share (in Dollars per share) | $ / shares | $ 0.0013 | $ 17.16 | ||||||||||||||||
Cash fee equal percentage | 7% | |||||||||||||||||
Management fee equal percentage | 1% | |||||||||||||||||
Non accountable expense | $ 3,000 | $ 65 | ||||||||||||||||
Clearing expenses | $ 16 | |||||||||||||||||
Cuentas SDI [Member] | ||||||||||||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||||||||||||
Ownership percentage in subsidiaries | 19.99% | |||||||||||||||||
Offering cost | $ 750,000 | |||||||||||||||||
Gross revenues percentage | 40% | |||||||||||||||||
Underwriter's [Member] | ||||||||||||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||||||||||||
Offering exercise price per share (in Dollars per share) | $ / shares | $ 69.88 | $ 69.88 | $ 23.17 | |||||||||||||||
Warrant [Member] | ||||||||||||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||||||||||||
Reverse stock split, description | the Company’s common stock and warrants began trading on The Nasdaq Capital Market under the symbols “CUEN” and “CUENW,” respectively. On February 4, 2021 the Company sold an aggregate of 214,669 units at a price to the public of $55.90 per unit (the “Offering”), each unit consisting of one share of the Company’s common stock, par value $0.001 per share (the “Common Stock”), and a warrant exercisable for five years to purchase one share of Common Stock at an exercise price of $55.90 per share (the “Warrants”), pursuant to that certain Underwriting Agreement, dated as of February 1, 2021 (the “Underwriting Agreement”), between the Company and Maxim Group LLC (the “Representative” or “Maxim”), as representative of the sole underwriter. In addition, pursuant to the Underwriting Agreement, the Company granted Maxim a 45-day option to purchase up to 32,201 additional shares of Common Stock, and/or 32,201 additional Warrants, to cover over-allotments in connection with the Offering. The Common Stock and the Warrants were offered and sold to the public pursuant to the Company’s registration statements on Form S-1 (File Nos. 333-249690 and 333-252642), filed by the Company with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), on October 28, 2020, as amended, and which became effective on February 1, 2021. The Company received gross proceeds of approximately $12.0 million, before deducting underwriting discounts and commissions of 8% of the gross proceeds and estimated Offering expenses, and intend to use the net proceeds from the Offering for sales and marketing; purchase of chip-based debit card stock for GPR and Starter cards; repayment of outstanding loans; research and development; and working capital and operating expenses purposes. The Underwriting Agreement contains customary representations, warranties, and covenants by the Company. It also provides for customary indemnification by each of the Company and the Underwriter for losses or damages arising out of or in connection with the offering, including for liabilities under the Securities Act, other obligations of the parties and termination provisions. | |||||||||||||||||
Warrants issued (in Shares) | shares | 111,881 | |||||||||||||||||
Exercised offering shares (in Shares) | shares | 111,881 | |||||||||||||||||
Common stock in consideration | $ 5,765 | |||||||||||||||||
CUENTASMAX LLC [Member] | ||||||||||||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||||||||||||
Ownership percentage | 50% | |||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||||||||||||
Initial capital contribution | $ 2,000 | |||||||||||||||||
Interest rate | 63% | 63% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies and Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Summary of Significant Accounting Policies and Basis of Presentation (Details) [Line Items] | |||
Allowance for doubtful accounts (in Dollars) | $ 20 | $ 177 | |
Impairment losses (in Dollars) | $ 3,600 | ||
Dilutive securities (in Shares) | 615,063 | 260,854 | |
Purchase of stock price (in Shares) | 128,477 | 121,938 | |
Advertising costs (in Dollars) | $ 1 | $ 37 | |
Deferred revenue (in Dollars) | $ 109 | ||
Revenue percentage | 100% | ||
Warrant [Member] | |||
Summary of Significant Accounting Policies and Basis of Presentation (Details) [Line Items] | |||
Purchase of stock price (in Shares) | 486,587 | 138,915 | |
Minimum [Member] | |||
Summary of Significant Accounting Policies and Basis of Presentation (Details) [Line Items] | |||
Estimated useful life | 3 years | ||
Stock price range | $ 36.4 | $ 36.4 | |
Minimum [Member] | Warrant [Member] | |||
Summary of Significant Accounting Policies and Basis of Presentation (Details) [Line Items] | |||
Stock price range | $ 7.67 | 55.9 | |
Maximum [Member] | |||
Summary of Significant Accounting Policies and Basis of Presentation (Details) [Line Items] | |||
Estimated useful life | 5 years | ||
Stock price range | $ 186.55 | 186.55 | |
Maximum [Member] | Warrant [Member] | |||
Summary of Significant Accounting Policies and Basis of Presentation (Details) [Line Items] | |||
Stock price range | $ 260 | $ 260 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies and Basis of Presentation (Details) - Schedule of financial assets and liabilities are measured at fair value on a recurring basis - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Marketable securities | |||
Total assets | |||
Stock based liabilities | $ 1,000 | $ 3,000 | |
Total liabilities | 1,000 | 3,000 | |
Level 1 [Member] | |||
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Marketable securities | |||
Total assets | |||
Stock based liabilities | 1,000 | 3,000 | |
Total liabilities | 1,000 | 3,000 | |
Level 2 [Member] | |||
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Marketable securities | |||
Total assets | |||
Stock based liabilities | |||
Total liabilities | |||
Level 3 [Member] | |||
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Marketable securities | |||
Total assets | |||
Stock based liabilities | |||
Total liabilities |
Investments in Unconsolidated_2
Investments in Unconsolidated Entities (Details) - USD ($) $ in Thousands | 1 Months Ended | |
May 27, 2022 | Jul. 21, 2021 | |
Investments in Unconsolidated Entities (Details) [Line Items] | ||
Joint venture arrangement, description | Each of the Company and WaveMAX agrees to fund $120,000 (for a total of $240,000) initially upon execution of the Agreement. In addition, each of Cuentas and WaveMAX has agreed to fund an additional $127,500 over the succeeding five months, in each case, subject to approval of each party’s board of directors. The expenses of the JV Project shall include acquiring the Access Points hardware, the installation and configuration of the Access Points hardware for use with the broadband internet service at each Retail Location, entering into the necessary agreements with the Retail Locations, instore marketing and promotion of the WSN program, and expenses relating to commercialization of the digital advertising program. The Board of Directors of CUENTASMAX shall initially be comprised of four persons, two designated by Cuentas, one designated by WaveMAX, and one designated by Execon. The officers of CUENTASMAX shall be the persons from time to time designated by mutual agreement of Cuentas and WaveMAX, with the initial officers to be determined. Up to 1,000 high traffic, prime location convenience stores and “bodegas” (small community markets) will be signed up in conjunction with Cuentas’ distribution network that sells prepaid debit card, e-store, e-wallet and digital services. A fee of 2% (two percent) of the Net Revenue of CUENTASMAX will be paid by CUENTASMAX on a monthly basis as a commission to Innovateur Management SAPI de CV. WaveMax and Innovateur Management, SAPI de CV will be included in the Cuentas Share Incentive plan subject to approval by the Cuentas BOD and approval by Cuentas shareholders and Side Letter Participants at the next scheduled Annual Shareholders meeting. WaveMAX grants CUENTASMAX exclusive rights to use and deploy the WaveMAX Technology, including any and all patents owned or to be owned by WaveMAX and any and all related enhancements or applications of the WaveMAX Technology and any and all prior and subsequent improvements and/or new technology developed by WaveMAX solely in Cuentas BODEGAS network throughout the United States. The parties have agreed to expand CUENTASMAX to other areas of the US once the current deployment is in progress or has been completed. As of December 31,2022, the Company funded $80 in CUENTASMAX and recorded equity losses in the amount of $58. | |
Acquisition percentage | 19.99% | |
Addition loan amount (in Dollars) | $ 750,000 | |
Loan amount (in Dollars) | $ 100,000 | |
Cuentas [Member] | ||
Investments in Unconsolidated Entities (Details) [Line Items] | ||
Ownership and management, percentage | 50% | |
WaveMax [Member] | ||
Investments in Unconsolidated Entities (Details) [Line Items] | ||
Ownership and management, percentage | 25% | |
Consultoria y Asesoria de Redes [Member] | ||
Investments in Unconsolidated Entities (Details) [Line Items] | ||
Ownership and management, percentage | 25% |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Mar. 05, 2021 | Dec. 31, 2019 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 04, 2022 | |
Intangible Assets (Details) [Line Items] | |||||||
Licensing fee | $ 9,000 | ||||||
Total shares of common stock, percentage | 25% | ||||||
Fair value | $ 9,000 | ||||||
Consideration purchased | $ 47 | ||||||
Amortization expense | $ 2 | $ 453 | 1,810 | $ 1,809 | |||
Impairment charges | $ 3,600 | ||||||
Common Stock [Member] | |||||||
Intangible Assets (Details) [Line Items] | |||||||
Common stock, per share (in Dollars per share) | $ 0.001 | $ 0.001 |
Intangible Assets (Details) - S
Intangible Assets (Details) - Schedule of intangible assets - USD ($) $ in Thousands | Dec. 31, 2022 | Mar. 05, 2021 |
Schedule of Intangible Assets [Abstract] | ||
Intangible Assets, Amount | $ 9,000 | $ 47 |
Total, Life | 60 months | 60 months |
Other Intangible Assets [Member] | ||
Schedule of Intangible Assets [Abstract] | ||
Intangible Assets, Amount | $ 9,000 | $ 47 |
Total, Life | 60 months | 60 months |
Intangible Assets (Details) -_2
Intangible Assets (Details) - Schedule of amortization of intangible assets $ in Thousands | Dec. 31, 2022 USD ($) |
Schedule of Amortization of Intangible Assets [Abstract] | |
2023 | $ 10 |
2024 | 10 |
2025 | 8 |
Total | $ 28 |
Other Accounts Liabilities (Det
Other Accounts Liabilities (Details) - Schedule of other accounts accrued liabilities - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Other Accounts Accrued Liabilities [Abstract] | ||
Accrued expenses, interest and other liabilities | $ 309 | $ 1,063 |
Accrued salaries and wages | 105 | 63 |
Accrued bonuses | 267 | |
Total | $ 681 | $ 1,126 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||||
Aug. 19, 2022 | Aug. 05, 2021 | Aug. 02, 2021 | Mar. 05, 2021 | Aug. 26, 2021 | Aug. 25, 2021 | Feb. 24, 2021 | Jul. 24, 2020 | Dec. 31, 2019 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Aug. 15, 2022 | Aug. 02, 2022 | Dec. 31, 2021 | |
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Employment agreements term description | In consideration of Mr. Johnson’s agreement to enter into the Johnson Employment Agreement and remain with the Company, Mr. Johnson was to receive a one-time signing bonus in the amount of two hundred thousand dollars ($200), which is to be paid in two (2) installments: the first installment of one hundred thousand dollars ($100) to be paid on the Company’s next regular payday following the hire date of August 25, 2021, which was paid on August 30, 2021, and the second installment of one hundred thousand dollars ($100) to be paid on Company’s next regular payday following the first (1st) anniversary of the hire date of August 25, 2021, provided that Mr. Johnson is employed by the Company on such relevant payment date. | ||||||||||||||
Accrued bonus description | Half of the bonus $250 was paid in cash and half will be paid in Common stock of the Company . | ||||||||||||||
Payment description | On August 2, 2021, the Company’s Board of Directors approved the payment of the remainder of the up-listing bonus to Mr. Maimon and Mr. De Prado in the amount of $250 for each of them. On the same date, the Company paid $250 to Mr. Maimon and $250 for Mr. De Prado as described above. | ||||||||||||||
Bonus payment percentage | 2.50% | ||||||||||||||
Initial term | 3 years | ||||||||||||||
Salaries and wages percentage | 100% | ||||||||||||||
Employment agreement annual base salary | $ 245 | ||||||||||||||
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||
License agreement, description | Pursuant to the License Agreement, the Company shall pay CIMA annual fees for the maintenance and support services in accordance with the following schedule: (i) for the first (1st) calendar year from the Effective Date, $300 were paid in 2020; (ii) for the second (2nd) calendar year from the Effective Date, $500 , were paid in 2021; (iii) for the third (3rd) calendar year from the Effective Date, $700 to be paid during 2022; (iv) for the fourth (4th) calendar year from the Effective Date, $1,000 to be paid on December 31, 2022; (v) for the fifth (5th) calendar year from the Effective Date, $640 to be paid on December 31, 2022; and (vi) for each calendar year thereafter, $640 to be paid on the anniversary date | ||||||||||||||
Annual fees maintenance | $ 250 | ||||||||||||||
Software development services | 218 | ||||||||||||||
Annual fees amount | $ 177 | ||||||||||||||
Software development services | $ 147 | ||||||||||||||
Employment Agreements [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Employment agreements term description | Pursuant to the terms of the New Employment Agreements, among other things: (1) De Prado will receive the following compensation: (1) (a) a base salary of $265,000 per annum; (b) a Funding Bonus equal to 0.5% of the amount of the funding that exceeds the Funding Threshold; (c) a change of control bonus, if applicable; (d) participation in the Company’s employee benefits plan; (2) Maimon will receive the following compensation: (a) a base salary of $295,000 per annum; (b) a Funding Bonus equal to 0.5% of the amount of the funding that exceeds the Funding Threshold; (c) a change of control bonus, if applicable; (d) participation in the Company’s employee benefits plan; (3) For each Executive, the term of the Agreement shall end on the earlier of (i) the date that is four months following the Effective Date or (ii) the date that the Company appoints a new president or chief operating officer but the Company can extend the Employment Term on a month to month basis with the approval of both Dinar Zuz LLC (“Dinar”) and CIMA until a new president or chief operating officer is appointed. Upon expiration of the Employment Term (other than a termination by the Company for “Cause”), the Executive will entitled to a special board compensation package with annual compensation equal to the Annual Base Salary (pro-rated for any partial year of service), beginning on the Expiration or Termination Date and ending 18 months later, provided that such payments will cease if the Executive resigns as a member of the Board during such period. The Board Compensation Period may be extended from year to year for an additional 12 months (for up to 36 months in total) if two of three of the then-current chief executive officer of the Company, Dinar and CIMA agree to extend the period for an additional 12 months. The Executive’s right to receive the Special Board Compensation shall be subject to the Board’s determination that he has complied with his obligations under this Agreement. The Executive will remain on the Board until he resigns, is not re-elected or is removed from the Board in accordance with the Company’s practice for removal of directors. (4) Pursuant to the terms of the New Employment Agreements, the Executives are entitled to severance in the event of certain terminations of his employment. The Executives are entitled to participate in the Company’s employee benefit, pension and/or profit-sharing plans, and the Company will pay certain health and dental premiums on their behalf. (5) Each of the Executives are entitled to travel and expense reimbursement; (6) The Executives have agreed to a one-year non-competition agreement following the termination of their employment. | ||||||||||||||
Initial term | 1 year | ||||||||||||||
Software Maintenance Agreement [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Annual fees maintenance | 700 | ||||||||||||||
Software development services | 340 | ||||||||||||||
License Agreement Cima [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Licensing fee | $ 9,000 | ||||||||||||||
Common stock, percentage | 25% | ||||||||||||||
Settlement agreement amount paid | $ 350 | $ 350 | |||||||||||||
Unpaid fees | $ 420 | ||||||||||||||
License Agreement Cima [Member] | Common Stock [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Common stock, par value (in Dollars per share) | $ 0.001 | ||||||||||||||
Directors [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Annual fees amount | $ 500 | ||||||||||||||
Issued shares (in Shares) | 12,308 | ||||||||||||||
Exercisable period | 3 years | ||||||||||||||
Mr. Maimon [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Employment agreements term description | Pursuant to the terms of his Compensation Agreement, Mr. Maimon will receive an annual base salary of two hundred ninety-five thousand dollars ($295) per year, and pursuant to the terms of his Compensation Agreement, Mr. De Prado will receive an annual base salary of two hundred seventy-five thousand dollars ($275) per year, and each will be eligible for an annual incentive payment of up to one hundred percent (100%) of their respective base salary, which annual incentive payment shall be based on the Company’s performance as compared to the goals established by the Company’s Board of Directors in consultation with each Executive, respectively. | ||||||||||||||
Mr Johnson [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Employment agreements term description | the terms of the Compensation Agreements, each of Mr. Maimon and Mr. De Prado has the option to have any such earned annual incentive be paid in fully vested shares of the Company’s Common Stock, but must elect such option by the end of the first quarter following the relevant performance calendar year period. In the event of a change in control of the Company, as defined under the terms of the Compensation Agreements, that takes place (i) during the term of the Compensation Agreement or (ii) prior to the date which is twenty-four (24) months from the effective date of the Compensation Agreements, if the Executive’s employment otherwise terminates prior to such date, each respective Executive shall be entitled to a bonus payment equal to two and one-half percent (2.5%) of the cash consideration received by the shareholders of the Company in the change in control transaction. On August 19, 2022, the Company’s Board of Directors approved a motion to appoint Arik Maimon as Interim CEO (in addition to his current position as Chairman of the Board) and Michael De Prado as Interim President (in addition to his current position as Vice Chairman of the Board). Both Arik Maimon and Michael De Prado agreed to assume these positions with no additional compensation.On August 25, 2021, the Company and Jeffery D. Johnson entered into an employment agreement, pursuant to which Mr. Johnson agreed to serve as the Company’s new Chief Executive Officer (“The Johnson Employment Agreement”). The Johnson Employment Agreement commenced and became effective as of August 25, 2021, and shall continue for an initial term of three (3) years, ending on August 24, 2024. The initial term would be automatically extended for additional one (1) year periods on the same terms and conditions as set out in the Johnson Employment Agreement; however, the Employment Agreement will not renew automatically if either the Company or Mr. Johnson provide a written notice to the other of a decision not to renew, which notice must be given at least ninety (90) days prior to the end of the initial term or any subsequently renewed one (1) year term. Pursuant to the terms of the Johnson Employment Agreement, Mr. Johnson will receive an annual base salary of three hundred thousand dollars ($300) per year, and will be eligible for an annual incentive payment of up to one hundred percent (100%) of his base salary, which annual incentive payment shall be based on the Company’s performance as compared to the goals established by the Company’s Board of Directors in consultation with Mr. Johnson. This annual incentive shall have a twelve (12) month performance period and will be based on a January 1 through December 31 calendar year, with Mr. Johnson’s entitlement to the annual incentive and the amount of such award, if any, remaining subject to the good faith discretion of the Board of Directors. Pursuant to the terms of the Johnson Employment Agreement, Mr. Johnson has the option to have any such earned annual incentive be paid in fully vested shares of the Company’s Common Stock, but must elect such option by the end of the first quarter following the relevant performance calendar year period. In consideration of Mr. Johnson’s agreement to enter into the Johnson Employment Agreement and remain with the Company, Mr. Johnson was to receive a one-time signing bonus in the amount of two hundred thousand dollars ($200), which is to be paid in two (2) installments: the first installment of one hundred thousand dollars ($100) to be paid on the Company’s next regular payday following the hire date of August 25, 2021, which was paid on August 30, 2021, and the second installment of one hundred thousand dollars ($100) to be paid on Company’s next regular payday following the first (1st) anniversary of the hire date of August 25, 2021, provided that Mr. Johnson is employed by the Company on such relevant payment date. Pursuant to the terms of the Johnson Employment Agreement, subject to the shareholder approval of the 2021 Plan, the Company shall issue to Mr. Johnson an option to purchase up to 38,462 shares of Common Stock; On August 18, 2022, Jeffery D. Johnson entered into a Separation of Employment Agreement between himself and the Company and resigned as the chief executive officer of the Company | ||||||||||||||
Settlement Agreement [Member] | |||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||
Annual fees maintenance | $ 500 |
Related Party Transactions (D_2
Related Party Transactions (Details) - Schedule of due from related parties - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
SDI Cuentas LLC [Member] | |||
Related Party Transactions (Details) - Schedule of due from related parties [Line Items] | |||
Total Due from related parties | $ 198 | $ 1 | |
Due to Cima Telecom Inc. [Member] | |||
Related Party Transactions (Details) - Schedule of due from related parties [Line Items] | |||
Total Due from related parties | [1] | $ 250 | |
[1]Composed from annual fees in the amount of $250 for the maintenance and support services in accordance with the software maintenance agreement for the second calendar year from the Effective Date and other software development services. |
Related Party Transactions (D_3
Related Party Transactions (Details) - Schedule of due from related parties (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
SDI Cuentas LLC [Member] | |||
Related Party Transactions (Details) - Schedule of due from related parties (Parentheticals) [Line Items] | |||
Net of allowance for credit losses | $ 157 | $ 157 | $ 0 |
Related Party Transactions (D_4
Related Party Transactions (Details) - Schedule of related party transactions - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Related Party Transactions | $ 1,051 | $ 880 | |
Sales to SDI Cuentas LLC [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | 2,052 | 62 | |
Consulting fees to Angelo De Prado [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | [1] | 6 | |
Consulting fees to Sima Maimon Bakhar [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | [2] | 10 | |
Doubtful accounts – Cuentas SDI LLC [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | 157 | ||
Consulting fees to Carol Pepper [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | [3] | 40 | |
Cima Telecom Inc. [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | [4] | $ 918 | $ 840 |
[1] Angelo De Prado is the son of Michael De Prado. Sima Maimon Bakhar is the wife of Aril Maimon. Composed of consulting fee in additional to the directorship fees. Composed of periodic fees in the amount of $700 thousand for the maintenance and support services in accordance with the software maintenance agreement and the Settlement Agreement and General Release dated August 2, 2022 and $500 for the first half of the second calendar year from the effective date of the agreement, $218 thousand for software development and other services during 2022 and $340 thousand for software development and other services during 2022. Refer to note 10. The maintenance and support services and most of the software development and other services were recorded in cost of goods sold in the Digital products and General-Purpose Reloadable Cards segment. |
Stock Options (Details)
Stock Options (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
Aug. 19, 2022 | Feb. 01, 2022 | Nov. 03, 2021 | Dec. 30, 2022 | May 17, 2022 | Dec. 31, 2022 | Aug. 04, 2022 | |
Stock Options (Details) [Line Items] | |||||||
Shares issued (in Shares) | 7,692 | ||||||
Exercise price (in Dollars per share) | $ 36.4 | $ 36.4 | $ 36.4 | $ 11.54 | |||
Option value | $ 18,000 | ||||||
Vesting options (in Shares) | 12,307 | ||||||
Exercisable period | 3 years | ||||||
Fair value options | $ 134,000 | ||||||
Stock based payment vested options | $ 3,847,000 | ||||||
Estimated fair value | $ 213,000 | ||||||
Stock options | $ 119,229 | ||||||
Estimated fair value | $ 4,340,000 | ||||||
Ordinary shares reserved incentive plan (in Shares) | 124,231 | ||||||
Board of Directors [Member] | |||||||
Stock Options (Details) [Line Items] | |||||||
Shares issued (in Shares) | 15,384 | ||||||
Chief Operating Officer [Member] | |||||||
Stock Options (Details) [Line Items] | |||||||
Shares issued (in Shares) | 15,384 |
Stock Options (Details) - Sched
Stock Options (Details) - Schedule of summarizes all stock option activity - $ / shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Options (Details) - Schedule of summarizes all stock option activity [Line Items] | |||
Shares, Outstanding beginning | 128,477 | 121,938 | 10,401 |
Weighted- Average Exercise Price Per Share, Outstanding beginning | $ 47.97 | $ 145.34 | |
Shares, Granted | 38,461 | 119,229 | |
Weighted- Average Exercise Price Per Share, Granted | $ 36.4 | $ 36.4 | |
Shares, Forfeited | (6,093) | (31,922) | 7,692 |
Weighted- Average Exercise Price Per Share, Forfeited | $ 186.55 | $ 36.4 | $ 36.4 |
Shares, Outstanding ending | 128,477 | 121,938 | |
Weighted- Average Exercise Price Per Share, Outstanding ending | $ 49.96 | $ 56.44 | $ 47.97 |
Stock Options (Details) - Sch_2
Stock Options (Details) - Schedule of table discloses information regarding outstanding and exercisable options - Stock Option [Member] - $ / shares | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Options (Details) - Schedule of table discloses information regarding outstanding and exercisable options [Line Items] | ||||
Outstanding, Number of Option Shares (in Shares) | 128,477 | 121,938 | ||
Outstanding, Weighted Average Exercise Price | $ 49.96 | $ 47.97 | $ 56.42 | $ 56.44 |
Outstanding, Weighted Average Remaining Life (Years) | 8 years 4 months 17 days | 8 years 10 months 17 days | 8 years 1 month 20 days | 9 years 1 month 17 days |
Exercisable, Number of Option Shares (in Shares) | 114,689 | 64,246 | 120,782 | 70,785 |
Exercisable, Weighted Average Exercise Price | $ 38.3 | $ 54.08 | $ 45.78 | $ 55.12 |
14.35 [Member] | ||||
Stock Options (Details) - Schedule of table discloses information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 186.55 | $ 186.55 | ||
Outstanding, Number of Option Shares (in Shares) | 6,093 | 6,093 | ||
Outstanding, Weighted Average Exercise Price | $ 186.55 | $ 186.55 | $ 186,055 | |
Outstanding, Weighted Average Remaining Life (Years) | 11 months 26 days | 2 months 26 days | 1 year 2 months 26 days | |
Exercisable, Number of Option Shares (in Shares) | 6,093 | 6,093 | 6,093 | |
Exercisable, Weighted Average Exercise Price | $ 186.55 | $ 186.55 | $ 186.55 | |
7.50 [Member] | ||||
Stock Options (Details) - Schedule of table discloses information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 97.5 | $ 97.5 | ||
Outstanding, Number of Option Shares (in Shares) | 2,769 | 2,769 | ||
Outstanding, Weighted Average Exercise Price | $ 97.5 | $ 97.5 | $ 97.5 | $ 97.5 |
Outstanding, Weighted Average Remaining Life (Years) | 5 months 15 days | 1 year 5 months 15 days | 8 months 15 days | 1 year 8 months 15 days |
Exercisable, Number of Option Shares (in Shares) | 2,769 | 2,769 | 2,769 | 2,769 |
Exercisable, Weighted Average Exercise Price | $ 97.5 | $ 97.5 | $ 97.5 | $ 97.5 |
5.23 [Member] | ||||
Stock Options (Details) - Schedule of table discloses information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 67.99 | $ 67.99 | ||
Outstanding, Number of Option Shares (in Shares) | 1,538 | 1,538 | ||
Outstanding, Weighted Average Exercise Price | $ 67.99 | $ 67.99 | $ 67.99 | $ 67.99 |
Outstanding, Weighted Average Remaining Life (Years) | 11 months 26 days | 1 year 11 months 26 days | 1 year 2 months 26 days | 2 years 2 months 26 days |
Exercisable, Number of Option Shares (in Shares) | 1,538 | 1,538 | 1,538 | 1,538 |
Exercisable, Weighted Average Exercise Price | $ 67.99 | $ 67.99 | $ 67.99 | $ 67.99 |
2.80 [Member] | ||||
Stock Options (Details) - Schedule of table discloses information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 36.4 | $ 36.4 | ||
Outstanding, Number of Option Shares (in Shares) | 118,077 | 111,538 | ||
Outstanding, Weighted Average Exercise Price | $ 36.4 | $ 36.4 | $ 36.4 | $ 36.4 |
Outstanding, Weighted Average Remaining Life (Years) | 8 years 8 months 4 days | 9 years 7 months 2 days | 8 years 10 months 17 days | 9 years 10 months 2 days |
Exercisable, Number of Option Shares (in Shares) | 110,382 | 53,846 | 110,382 | 60,385 |
Exercisable, Weighted Average Exercise Price | $ 36.4 | $ 36.4 | $ 36.4 | $ 36.4 |
Stock Options (Details) - Sch_3
Stock Options (Details) - Schedule of black-scholes option pricing model | 12 Months Ended |
Dec. 31, 2022 $ / shares | |
Stock Options (Details) - Schedule of black-scholes option pricing model [Line Items] | |
Common stock price (in Dollars per share) | $ 36.4 |
Dividend yield | 0% |
Risk-free interest rate | 1.60% |
Expected term (years) | 10 years |
Expected volatility | 480% |
Board of Directors [Member] | |
Stock Options (Details) - Schedule of black-scholes option pricing model [Line Items] | |
Common stock price (in Dollars per share) | $ 2.366 |
Dividend yield | 0% |
Risk-free interest rate | 3.88% |
Expected term (years) | 10 years |
Expected volatility | 454% |
Two Board of Directors [Member] | |
Stock Options (Details) - Schedule of black-scholes option pricing model [Line Items] | |
Common stock price (in Dollars per share) | $ 8.71 |
Dividend yield | 0% |
Risk-free interest rate | 2.98% |
Expected term (years) | 10 years |
Expected volatility | 480% |
Chief Operating Officer [Member] | |
Stock Options (Details) - Schedule of black-scholes option pricing model [Line Items] | |
Common stock price (in Dollars per share) | $ 13.91 |
Dividend yield | 0% |
Risk-free interest rate | 1.79% |
Expected term (years) | 10 years |
Expected volatility | 197% |
Stock Options (Details) - Sch_4
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Jeffery D Johnson [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 38,462 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 9,616 on grant date. 14,423 on each of the next 2 Employment Anniversaries. |
Shalom Arik Maimon [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 15,385 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Michael DePrado [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 11,538 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Ran Daniel [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Richard Berman [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Yochanon Bruk [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Jeff Lewis [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
David Schottenstein [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Adiv Baruch [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Carol Pepper [Member] | |
Stock Options (Details) - Schedule of stock options to executives’ officers and non-employee directors [Line Items] | |
Number of Options | shares | 7,692 |
Exercise Price | $ / shares | $ 36.4 |
Vesting Schedule | 50% on grant date; 50% on 12 month anniversary of grant date |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Feb. 06, 2023 | Aug. 08, 2022 | Aug. 04, 2022 | Apr. 06, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2019 | |
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock, shares authorized (in Shares) | 360,000,000 | 360,000,000 | 360,000,000 | |||||
Common stock purchase shares (in Shares) | 324,928 | |||||||
Common stock warrants per share | $ 17.16 | |||||||
Other offering expenses (in Dollars) | $ 3,000 | $ 65 | ||||||
Common stock shares (in Shares) | 163,344 | 265,152 | ||||||
Exercise price per share | $ 1.782 | |||||||
Warrants issuance value (in Dollars) | $ 165 | |||||||
Private Placement [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Percentage of gross proceeds | 7% | |||||||
Common Stock [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock, share issued (in Shares) | 7,693 | |||||||
Fair market value (in Dollars) | $ 110 | |||||||
Common stock, par value | $ 0.001 | $ 0.001 | ||||||
Exercise price per share | $ 0.0001 | |||||||
Common Stock Warrant [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock warrants per share | 9.23 | |||||||
Exercise price per share | 7.67 | |||||||
Pre Funded Warrant [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock warrants per share | 9.23 | |||||||
Exercise price per share | $ 0.0001 | |||||||
Placement Agent Warrants [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock shares (in Shares) | 22,745 | |||||||
Exercise price per share | $ 11.54 | |||||||
Maximum [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Exercise price per share | $ 186.55 | $ 186.55 | ||||||
Maximum [Member] | Common Stock [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock, shares authorized (in Shares) | 127,308 | |||||||
Maximum [Member] | Common Stock Warrant [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Exercisable period of issuance date | 5 years | |||||||
Maximum [Member] | Placement Agent Warrants [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Exercisable period of issuance date | 5 years | |||||||
Minimum [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Exercise price per share | $ 36.4 | $ 36.4 | ||||||
Minimum [Member] | Common Stock [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Common stock, shares authorized (in Shares) | 197,620 | |||||||
Minimum [Member] | Common Stock Warrant [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Exercisable period of issuance date | 6 months | |||||||
Minimum [Member] | Placement Agent Warrants [Member] | ||||||||
Stockholders' Equity (Details) [Line Items] | ||||||||
Exercisable period of issuance date | 6 months |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - Schedule of common stock activity | 12 Months Ended |
Dec. 31, 2022 shares | |
Schedule of Common Stock Activity [Abstract] | |
Balance, Beginning balance | 1,151,207 |
Shares of Common Stock issued | 324,928 |
Shares issued for services | 7,693 |
Treasury stock | (10,183) |
Balance, Ending balance | 1,473,645 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Mar. 14, 2023 | Oct. 04, 2022 | Apr. 01, 2021 | Apr. 01, 2021 | May 01, 2019 | May 01, 2019 | May 25, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | |
Commitments and Contingencies [Abstract] | |||||||||
Commitments and contingencies, description | the Company received a notice of demand for arbitration from Secure IP Telecom, Inc. (“Secure IP), who allegedly had a Reciprocal Carrier Services Agreement (“RCS”) exclusively with Limecom and not with the Company. The arbitration demand originated from another demand for arbitration that Secure IP received from VoIP Capital International (“VoIP”) in March 2019, demanding $1,053 in damages allegedly caused by unpaid receivables that Limecom assigned to VoIP based on the RCS. On or about October 5, 2020, the trial court appointed a receiver over Limecom, Inc. (“Limecom”) in the matter of Spectrum Intelligence Communications Agency, LLC. v. Limecom, Inc., case no. 2018-027150-CA-01 pending in the 11th Circuit for Miami-Dade County, Florida. On June 5, 2020, Secure IP Telecom, Inc. (“Secure IP”) filed a complaint against Limecom, Heritage Ventures Limited (“Heritage”), an unrelated third party and owner of Limecom, and the Company, case no. 20-11972-CA-01. Secure IP alleges that the Company received certain transfers from Limecom during the period that the Company wholly owned Limecom that may be an avoidable under Florida Statute § 725.105. On July 13, 2021, the two cases were consolidated, and are now pending before the same trial court under the former case number. The Company has answered and denied any liability with respect to both complaints. To the extent the Company has exposure for any transfers from Limecom, Heritage has indemnified the Company for any such liability and the Company has a pending cross-claim against Heritage for purposes of enforcing the indemnification obligation. A review of the books and records of the Company reflect aggregate transfers from Limecom to the Company or its affiliates of less than $600. The Company’s books and records reflect that the Company fully reimbursed Limecom through direct payment of expenses of Limecom and through issuance of shares by the Company to employees or other vendors on behalf of Limecom for settlement and release of claims the employees or vendors may have asserted against Limecom. The books and records of the Company therefore do not reflect an identifiable avoidable transfer, but this analysis may change as the discovery process continues. | the Company received a notice of demand for arbitration from Secure IP Telecom, Inc. (“Secure IP), who allegedly had a Reciprocal Carrier Services Agreement (“RCS”) exclusively with Limecom and not with the Company. The arbitration demand originated from another demand for arbitration that Secure IP received from VoIP Capital International (“VoIP”) in March 2019, demanding $1,053 in damages allegedly caused by unpaid receivables that Limecom assigned to VoIP based on the RCS. On or about October 5, 2020, the trial court appointed a receiver over Limecom, Inc. (“Limecom”) in the matter of Spectrum Intelligence Communications Agency, LLC. v. Limecom, Inc., case no. 2018-027150-CA-01 pending in the 11th Circuit for Miami-Dade County, Florida. On June 5, 2020, Secure IP Telecom, Inc. (“Secure IP”) filed a complaint against Limecom, Heritage Ventures Limited (“Heritage”), an unrelated third party and owner of Limecom, and the Company, case no. 20-11972-CA-01. Secure IP alleges that the Company received certain transfers from Limecom during the period that the Company wholly owned Limecom that may be an avoidable under Florida Statute § 725.105. On July 13, 2021, the two cases were consolidated, and are now pending before the same trial court under the former case number. The Company has answered and denied any liability with respect to both complaints. To the extent the Company has exposure for any transfers from Limecom, Heritage has indemnified the Company for any such liability and the Company has a pending cross-claim against Heritage for purposes of enforcing the indemnification obligation. A review of the books and records of the Company reflect aggregate transfers from Limecom to the Company or its affiliates of less than $600. The Company’s books and records reflect that the Company fully reimbursed Limecom through direct payment of expenses of Limecom and through issuance of shares by the Company to employees or other vendors on behalf of Limecom for settlement and release of claims the employees or vendors may have asserted against Limecom. The books and records of the Company therefore do not reflect an identifiable avoidable transfer, but this analysis may change as the discovery process continues. At this time, based upon an analysis of the Company’s books and records, the loss contingency is not capable of reasonable estimation under the above circumstances, and the likelihood of an adverse judgment is not probable at this time. An adverse judgment in this matter is reasonably possible and based upon an analysis of litigation costs and likelihood of a settlement. | |||||||
Accrued amount | $ 300 | $ 300 | |||||||
Platform exclusive license agreement, description | the Company received a notice of default from CIMA Telecom, Inc. (“CIMA”) related to that certain Platform Exclusive License Agreement, maintenance, and related agreements by and among Cuentas, CIMA, Knetik, Inc., and Auris, LLC. The notice provides that Cuentas has failed to pay $700 of maintenance and pass-through fees that CIMA alleges are owed under the License Agreement and also afforded Cuentas the required sixty-day period (through July 24, 2022) to cure the default as provided under the License Agreement.. On August 2, 2022, the Company and CIMA, along with two of CIMA’s wholly-owned subsidiaries, Knetik, Inc. and Auris, LLCexecuted a Settlement Agreement and General Release which resolves the issues related to the July 8, 2022 notice of default from CIMA related to that certain Platform Exclusive License Agreement, maintenance, and related agreements by and among Cuentas, CIMA, Knetik, Inc., and Auris, LLC. The Parties executed Mutual General Releases and the settlement terms are as follows: In exchange for the consideration provided in the Settlement Agreement, (1) the Company paid CIMA $350on August 2, 2022 and (2) on or before 5:00 p.m New York City time, on August 15, 2022, Cuentas will pay CIMA the balance of the Unpaid Fees ($420.239) by wire transfer (3) Cuentas will a period of 30 days from execution date, the exclusive right to facilitate a third party (including to current shareholders and directors of Cuentas) purchase (without markup or broker fee) of, all of the shares of Cuentas held by CIMA at the higher of: (i) the average per share trading price for the three day average before notice in writing is provided by Cuentas of the intent to purchase CIMA’s Cuentas shares, or (ii) the minimum price of $0.50 per share on or before 5:00 p.m. New York City time, on August 31, 2022 pursuant to a purchase agreement delivered by and acceptable to CIMA without any changes thereto (provided, that CIMA shall not be required to provide any representations or warranties other than fundamental warranties related to (a) organization and good standing, (b) power and authority to undertake the transaction and (c) ownership of such shares, and ordinary representations and warranties that the Cuentas shares are being transferred free and clear of any liens, claims, or encumbrances); and (iv) on or before 5:00 p.m. New York City time, on August 2, 2022, Cuentas shall, and shall cause (x) Dinar Zuz, LLC, (y) Michael De Prado and (z) Arik Maimon to provide signed waiver letters, expressly waiving any right of first refusal and co-sale rights granted in their favor under that certain letter agreement, dated December 31, 2019, by and among CIMA, Dinar Zuz, LLC, Michael Del Prado and Arik Maimon, and (y) CIMA agrees: (i) to restore immediately Cuentas’ access to the Platform upon receipt of the $350 payment ; (ii) to provide Cuentas with a limited license to utilize the Platform the terms of which are detailed specifically in Section 6 of the agreement, and to use reasonable efforts, subject to Cuentas’ compliance hereto, to provide Cuentas’ customer data to Cuentas through the end of the limited license term described below in Section 6 of the agreement; (iii) deliver to Cuentas the Source Code (as that term is defined in paragraph 1.18 of the License Agreement) relating to Out-Of-Scope Services, and as further detailed in Section 6 of the agreement; (iv) not enforce its rights under the Side Letter (as that term is defined in the paragraph 1.1 of the Purchase Agreement) through and including August 31, 2022, and (v) shall not transfer, sell, or encumber its Cuentas shares through and including August 31, 2022, except as permitted herein. Cuentas acknowledges and agrees that the amount of Unpaid Fees ($770.239) is valid and outstanding, and waives any right to dispute them. If Cuentas fails to comply with any term of this Settlement Agreement, in addition to the Stipulated Judgment described in Section 5 of the agreement, the limited license set forth in Section 6 and any of CIMA’s obligations under this Settlement Agreement shall become null and CIMA shall have the right to shut off Cuentas access to the Platform without notice. | ||||||||
Companies financial institution | Crosshair Media Placement, LLC, a Kentucky based marketing company, filed and served a complaint on Cuentas for breach of contract alleging breach of contract damages of $629,807.74, which case remains pending in the United States District Court for the Western District of Kentucky, case no. 3:22-CV-512-CHB. | ||||||||
Rental payments | $ 7 | $ 9 | |||||||
Company financial agreement, description | Crosshair Media Placement, LLC, a Kentucky based marketing company, filed and served a complaint on Cuentas for breach of contract alleging breach of contract damages of $630, which case remains pending in the United States District Court for the Western District of Kentucky, case no. 3:22-CV-512-CHB. | ||||||||
Accrued amount | $ 630 | ||||||||
Employment agreement amount | $ 30 |
Segments of operations (Details
Segments of operations (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Segments of Operations [Abstract] | ||
Sales to cuentas SDI LLC, percentage | 72% | 10.50% |
Segments of operations (Detai_2
Segments of operations (Details) - Schedule of revenue by product - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 2,994 | $ 593 | ||
Gross profit (loss) [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 486 | 124 | ||
Long lived assets [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ (64) | $ (394) | 5,400 | |
Telecommunications [Member] | Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (49) | (175) | 839 | 525 |
Telecommunications [Member] | Gross profit (loss) [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 607 | 212 | ||
Telecommunications [Member] | Long lived assets [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 7 | (66) | ||
General Purpose Reloadable Cards [Member] | Revenue [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (15) | (219) | 2,155 | 68 |
General Purpose Reloadable Cards [Member] | Gross profit (loss) [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (121) | (88) | ||
General Purpose Reloadable Cards [Member] | Long lived assets [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 52 | $ 88 | $ 5,400 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes [Abstract] | ||
Tax credits, percentage | 50% | |
Income tax benefits | $ 0 | $ 0 |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of actual tax expense - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Actual Tax Expense [Abstract] | ||
Loss before taxes, as reported in the consolidated statements of operations | $ 14,479 | $ 10,728 |
Federal and State statutory rate | 26.50% | 26.50% |
Theoretical tax benefit on the above amount at federal statutory tax rate | $ 3,837 | $ 2,842 |
Permanent differences | (1,854) | (1,180) |
Losses and other items for which a valuation allowance was provided or benefit from loss carry forward | (1,983) | (1,662) |
Actual tax income (expense) |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of deferred tax assets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carry-forward | $ 8,165 | $ 5,464 |
Adjustments | (1,118) | (1,015) |
Valuation allowance | (7,047) | (4,449) |
Net deferred tax assets |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of valuation allowance $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Schedule of Valuation Allowance [Abstract] | |
Valuation allowance, December 31, 2021 | $ 4,449 |
Increase | 2,598 |
Valuation allowance, December 31, 2022 | $ 7,047 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||||||||||
Apr. 06, 2023 | Mar. 09, 2023 | Feb. 03, 2023 | Jan. 05, 2023 | Apr. 06, 2022 | Mar. 27, 2023 | Mar. 16, 2023 | Dec. 31, 2022 | Apr. 28, 2023 | Apr. 08, 2023 | Mar. 31, 2023 | Feb. 06, 2023 | Dec. 31, 2021 | |
Subsequent Events (Details) [Line Items] | |||||||||||||
Share issued (in Shares) | 1,473,645 | 2,103,365 | 1,157,207 | ||||||||||
Investor’s option percentage | 9.99% | ||||||||||||
Exercise price (in Dollars per share) | $ 1.782 | ||||||||||||
Aggregate cash fee percentage | 7% | ||||||||||||
Management fee percentage | 1% | ||||||||||||
Non-accountable expense | $ 65,000,000 | ||||||||||||
Clearing expenses | $ 15,950,000 | ||||||||||||
Shares of common stock (in Shares) | 265,152 | 163,344 | |||||||||||
Offering expenses | $ 4,300,000 | ||||||||||||
Warrants [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Investor’s option percentage | 4.99% | ||||||||||||
Exercise price (in Dollars per share) | $ 1.335 | ||||||||||||
Common Stock [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Exercise price (in Dollars per share) | $ 0.0001 | ||||||||||||
Fair market value issuance | $ 110,000 | ||||||||||||
Subsequent Event [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Binding letter of intent, description | the Company entered into a Binding Letter of Intent with Core Development Holdings Corporation (“Core”), a Florida corporation that holds approximately 29.3% of 4280 Lakewood Road Manager, LLC (“Lakewood Manager”), which in turn owns 86.45% of the membership interests in 4280 Lakewood Road, LLC (“4280 Project”), an affordable multi-family real estate project located in Lake Worth, Florida. | ||||||||||||
Common shares to acquire | $ 2,000,000 | ||||||||||||
Number of post- issuance, percentage | 33.30% | ||||||||||||
Ownership percentage | 33.30% | ||||||||||||
Post-issuance ownership percentage | 33.30% | ||||||||||||
Average of fair market value, percentage | 15% | ||||||||||||
Appraisals, percentage | 15% | ||||||||||||
Sale interest Percentage | 6% | ||||||||||||
Shares percentage | 19.90% | ||||||||||||
Bid price (in Dollars per share) | $ 1,000 | ||||||||||||
Securities purchase agreement description | the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an institutional investor (the “Investor”) for the purpose of raising approximately $5 million in gross proceeds for the Company. Pursuant to the terms of the Purchase Agreement, the Company agreed to sell, in a registered direct offering, an aggregate of (i) 2,123,478 shares (the “Shares”) of the Company’s common stock (“Common Stock”) and (ii) pre-warrants to purchase up to 1,664,401 shares of Common Stock (the “Pre-Funded Warrants” and such shares of Common Stock issuable upon exercise of the Pre-Funded Warrants, the “Pre-Funded Warrant Shares”) and, in a concurrent private placement, warrants (the “Purchase Warrants”) to purchase 3,787,879 shares of Common Stock (the shares of Common Stock issuable upon exercise of the Purchase Warrants, the “Purchase Warrant Shares”). The combined purchase price per Share and Purchase Warrant is $1.32 and the combined purchase price per Pre-Funded Warrant and Purchase Warrant of $1.3199. | ||||||||||||
Fair market value issuance | $ 112,000 | $ 112,000 | |||||||||||
Total purchase price | $ 5,050 | ||||||||||||
Initial capital contribution | 2,000,000 | ||||||||||||
Bank loan from republic bank of chicago | $ 3,050,000 | ||||||||||||
Interest rate | 63% | 63% | |||||||||||
Subsequent Event [Member] | Common Stock [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Share issued (in Shares) | 27,759 | 15,385 | |||||||||||
Lakewood Road Manager [Member] | Subsequent Event [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Equity acquire, percentage | 6% | ||||||||||||
Equity valued | $ 1,195,195,000 | ||||||||||||
Lakewood Road Manager [Member] | Subsequent Event [Member] | Common Stock [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Share issued (in Shares) | 295,282 | ||||||||||||
Lakewood Road Manager [Member] | Subsequent Event [Member] | Cuentas [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Common shares issued (in Shares) | 295,282 | ||||||||||||
Michael De Prado [Member] | Subsequent Event [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Annual incentive | $ 150,000,000 | ||||||||||||
Michael De Prado [Member] | Subsequent Event [Member] | Board of Directors [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Annual incentive | 150,000,000 | ||||||||||||
Arik Maimon [Member] | Subsequent Event [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Annual incentive | 150,000,000 | ||||||||||||
Arik Maimon [Member] | Subsequent Event [Member] | Board of Directors [Member] | |||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||
Annual incentive | $ 150,000,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies and Basis of Presentation (Details) - Schedule of deferred revenue - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Deferred Revenue [Abstract] | ||||
Balance at December 31, 2022 | $ 113 | |||
Change in deferred revenue | (4) | $ (88) | $ (570) | $ 31 |
Balance at March 31, 2023 | $ 109 | $ 113 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies and Basis of Presentation (Details) - Schedule of financial assets and liabilities are measured at fair value on a recurring basis - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Stock based liabilities | $ 1,000 | $ 3,000 | |
Total liabilities | 1,000 | 3,000 | |
Level 1 [Member] | |||
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Stock based liabilities | 1,000 | 3,000 | |
Total liabilities | 1,000 | 3,000 | |
Level 2 [Member] | |||
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Stock based liabilities | |||
Total liabilities | |||
Level 3 [Member] | |||
Schedule of Financial Assets and Liabilities are Measured at Fair Value on a Recurring Basis [Abstract] | |||
Stock based liabilities | |||
Total liabilities |
Stock Options (Details) - Sch_5
Stock Options (Details) - Schedule of stock option activity - $ / shares | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Options (Details) - Schedule of stock option activity [Line Items] | |||
Shares, Outstanding Beginning | 128,477 | ||
Weighted- Average Exercise Price Per Share, Outstanding Beginning | $ 56.44 | $ 47.97 | |
Shares, Granted | 38,461 | 119,229 | |
Weighted- Average Exercise Price Per Share, Granted | $ 36.4 | $ 36.4 | |
Shares, Forfeited | 6,093 | 31,922 | (7,692) |
Weighted- Average Exercise Price Per Share, Forfeited | $ 186.55 | $ 36.4 | $ 36.4 |
Shares, Outstanding ending | 122,384 | 128,477 | |
Weighted- Average Exercise Price Per Share, Outstanding ending | $ 49.96 | $ 56.44 | $ 47.97 |
Stock Options (Details) - Sch_6
Stock Options (Details) - Schedule of information regarding outstanding and exercisable options - Stock Option [Member] - $ / shares | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock Options (Details) - Schedule of information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 49.96 | $ 47.97 | $ 56.42 | $ 56.44 |
Outstanding, Number of Option Shares (in Shares) | 122,384 | 137,323 | ||
Outstanding, Weighted Average Exercise Price | $ 49.96 | $ 47.97 | $ 56.42 | $ 56.44 |
Outstanding, Weighted Average Remaining Life (Years) | 8 years 4 months 17 days | 8 years 10 months 17 days | 8 years 1 month 20 days | 9 years 1 month 17 days |
Exercisable, Number of Option Shares (in Shares) | 114,689 | 64,246 | 120,782 | 70,785 |
Exercisable, Weighted Average Exercise Price | $ 38.3 | $ 54.08 | $ 45.78 | $ 55.12 |
97.50 [Member] | ||||
Stock Options (Details) - Schedule of information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 97.5 | $ 97.5 | 97.5 | 97.5 |
Outstanding, Number of Option Shares (in Shares) | 2,769 | 2,769 | ||
Outstanding, Weighted Average Exercise Price | $ 97.5 | $ 97.5 | $ 97.5 | $ 97.5 |
Outstanding, Weighted Average Remaining Life (Years) | 5 months 15 days | 1 year 5 months 15 days | 8 months 15 days | 1 year 8 months 15 days |
Exercisable, Number of Option Shares (in Shares) | 2,769 | 2,769 | 2,769 | 2,769 |
Exercisable, Weighted Average Exercise Price | $ 97.5 | $ 97.5 | $ 97.5 | $ 97.5 |
67.99 [Member] | ||||
Stock Options (Details) - Schedule of information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 67.99 | $ 67.99 | 67.99 | 67.99 |
Outstanding, Number of Option Shares (in Shares) | 1,538 | 1,538 | ||
Outstanding, Weighted Average Exercise Price | $ 67.99 | $ 67.99 | $ 67.99 | $ 67.99 |
Outstanding, Weighted Average Remaining Life (Years) | 11 months 26 days | 1 year 11 months 26 days | 1 year 2 months 26 days | 2 years 2 months 26 days |
Exercisable, Number of Option Shares (in Shares) | 1,538 | 1,538 | 1,538 | 1,538 |
Exercisable, Weighted Average Exercise Price | $ 67.99 | $ 67.99 | $ 67.99 | $ 67.99 |
36.40 [Member] | ||||
Stock Options (Details) - Schedule of information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 36.4 | $ 36.4 | 36.4 | 36.4 |
Outstanding, Number of Option Shares (in Shares) | 118,077 | 126,923 | ||
Outstanding, Weighted Average Exercise Price | $ 36.4 | $ 36.4 | $ 36.4 | $ 36.4 |
Outstanding, Weighted Average Remaining Life (Years) | 8 years 8 months 4 days | 9 years 7 months 2 days | 8 years 10 months 17 days | 9 years 10 months 2 days |
Exercisable, Number of Option Shares (in Shares) | 110,382 | 53,846 | 110,382 | 60,385 |
Exercisable, Weighted Average Exercise Price | $ 36.4 | $ 36.4 | $ 36.4 | $ 36.4 |
186.55 [Member] | ||||
Stock Options (Details) - Schedule of information regarding outstanding and exercisable options [Line Items] | ||||
Exercise Prices | $ 186.55 | 186.55 | 186,055 | |
Outstanding, Number of Option Shares (in Shares) | 6,093 | |||
Outstanding, Weighted Average Exercise Price | $ 186.55 | $ 186.55 | $ 186,055 | |
Outstanding, Weighted Average Remaining Life (Years) | 11 months 26 days | 2 months 26 days | 1 year 2 months 26 days | |
Exercisable, Number of Option Shares (in Shares) | 6,093 | 6,093 | 6,093 | |
Exercisable, Weighted Average Exercise Price | $ 186.55 | $ 186.55 | $ 186.55 |
Related Party Transactions (D_5
Related Party Transactions (Details) - Schedule of due from related parties - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Related Party Transactions (Details) - Schedule of due from related parties [Line Items] | ||
Total Due from related parties | $ 298 | $ 198 |
Arik Maimoun [Member] | ||
Related Party Transactions (Details) - Schedule of due from related parties [Line Items] | ||
Total Due from related parties | 42 | |
Michael DePrado [Member] | ||
Related Party Transactions (Details) - Schedule of due from related parties [Line Items] | ||
Total Due from related parties | 46 | |
SDI Cuentas LLC [Member] | ||
Related Party Transactions (Details) - Schedule of due from related parties [Line Items] | ||
Total Due from related parties | $ 210 | $ 198 |
Related Party Transactions (D_6
Related Party Transactions (Details) - Schedule of due from related parties (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
SDI Cuentas LLC [Member] | |||
Related Party Transactions (Details) - Schedule of due from related parties (Parentheticals) [Line Items] | |||
Net of allowance for credit losses | $ 157 | $ 157 | $ 0 |
Related Party Transactions (D_7
Related Party Transactions (Details) - Schedule of related party transactions - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Related Party Transaction [Line Items] | |||
Related Party Transactions | $ 364 | ||
Doubtful accounts – Cuentas SDI LLC [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | 12 | 214 | |
Consulting fees to Carol Pepper [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | [1] | 40 | |
Cima Telecom Inc. [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transactions | [2] | $ 324 | |
[1] Composed of a consulting fee in addition to the directorship fees. Composed of periodic fees in the amount of $177 thousand for the maintenance and support services in accordance with the software maintenance agreement for the first quarter of the third calendar year and $147 thousand for software development services during the first quarter of 2022. |
Segments of operations (Detai_3
Segments of operations (Details) - Schedule of reportable operating segments - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of reportable operating segments [Abstract] | ||||
Revenue | $ (59) | $ (22) | ||
Revenue [Member] | ||||
Schedule of reportable operating segments [Abstract] | ||||
Revenue | $ (2,994) | $ (593) | ||
Long lived assets [Member] | ||||
Schedule of reportable operating segments [Abstract] | ||||
Revenue | 64 | 394 | (5,400) | |
Telecommunications [Member] | Revenue [Member] | ||||
Schedule of reportable operating segments [Abstract] | ||||
Revenue | 49 | 175 | (839) | (525) |
Telecommunications [Member] | Long lived assets [Member] | ||||
Schedule of reportable operating segments [Abstract] | ||||
Revenue | (7) | 66 | ||
General Purpose Reloadable Cards [Member] | Revenue [Member] | ||||
Schedule of reportable operating segments [Abstract] | ||||
Revenue | 15 | 219 | (2,155) | (68) |
General Purpose Reloadable Cards [Member] | Long lived assets [Member] | ||||
Schedule of reportable operating segments [Abstract] | ||||
Revenue | $ (52) | $ (88) | $ (5,400) |