Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 30, 2023 | Jun. 30, 2022 | |
Document Information Line Items | |||
Entity Registrant Name | authID Inc. | ||
Trading Symbol | AUID | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Common Stock, Shares Outstanding | 25,030,964 | ||
Entity Public Float | $ 42,823,720 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001534154 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Shell Company | false | ||
Entity Ex Transition Period | true | ||
ICFR Auditor Attestation Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity File Number | 001-40747 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 46-2069547 | ||
Entity Address, Address Line One | 1385 S. Colorado Blvd | ||
Entity Address, City or Town | Denver | ||
Entity Address, State or Province | CO | ||
Entity Address, Postal Zip Code | 80222 | ||
City Area Code | 516 | ||
Local Phone Number | 274-8700 | ||
Title of 12(b) Security | Common Stock par value $0.0001 per share | ||
Security Exchange Name | NASDAQ | ||
Entity Interactive Data Current | Yes | ||
Auditor Firm ID | 677 | ||
Auditor Name | Cherry Bekaert LLP | ||
Auditor Location | Tampa, Florida |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current Assets: | ||
Cash | $ 3,237,106 | $ 5,767,276 |
Accounts receivable, net | 261,809 | 26,846 |
Other current assets | 729,342 | 502,721 |
Current assets held for sale | 118,459 | 629,752 |
Total current assets | 4,346,716 | 6,926,595 |
Property and Equipment, net | 25,399 | |
Other Assets | 250,383 | 2,501 |
Intangible Assets, net | 566,259 | 2,379,452 |
Goodwill | 4,183,232 | 4,183,232 |
Non-current assets held for sale | 27,595 | 312,831 |
Total assets | 9,374,185 | 13,830,010 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 1,154,072 | 1,778,093 |
Convertible debt | 662,000 | |
Deferred revenue | 81,318 | 199,007 |
Current liabilities held for sale | 13,759 | 295,332 |
Total current liabilities | 1,249,149 | 2,934,432 |
Non-current Liabilities: | ||
Convertible debt | 7,841,500 | |
Total liabilities | 9,090,649 | 2,934,432 |
Commitments and Contingencies (Note 12) | ||
Stockholders’ Equity: | ||
Common stock, $0.0001 par value, 250,000,000 and 1,000,000,000 shares authorized; 25,319,095 and 23,294,024 shares issued and outstanding as of December 31, 2022 and 2021, respectively | 2,532 | 2,329 |
Additional paid in capital | 140,255,234 | 126,581,702 |
Accumulated deficit | (140,130,159) | (115,899,939) |
Accumulated comprehensive income | 155,929 | 211,486 |
Total stockholders’ equity | 283,536 | 10,895,578 |
Total liabilities and stockholders’ equity | $ 9,374,185 | $ 13,830,010 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 250,000,000 | 1,000,000,000 |
Common stock, shares issued | 25,319,095 | 23,294,024 |
Common stock, shares outstanding | 25,319,095 | 23,294,024 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues: | ||
Verified software license | $ 156,646 | $ 64,799 |
Legacy authentication services | 370,769 | 548,717 |
Total revenues, net | 527,415 | 613,516 |
Operating Expenses: | ||
General and administrative | 14,676,938 | 12,831,786 |
Research and development | 6,269,175 | 2,878,952 |
Depreciation and amortization | 749,900 | 1,157,773 |
Impairment losses | 1,101,867 | 831,075 |
Total operating expenses | 22,797,880 | 17,699,586 |
Loss from continuing operations | (22,270,465) | (17,086,070) |
Other (Expense) Income | ||
Interest expense, net | (1,359,954) | (586,850) |
Other (expense) income, net | (37,221) | 651 |
Gain on extinguishment of debt | 971,522 | |
Other (expense) income, net | (1,397,175) | 385,323 |
Loss from continuing operations before income taxes | (23,667,640) | (16,700,747) |
Income tax expense | (7,670) | (10,746) |
Loss from continuing operations | (23,675,310) | (16,711,493) |
Loss from discontinued operations | (366,663) | (954,295) |
Loss from sale of a discontinued operation | (188,247) | |
Total loss from discontinued operations | (554,910) | (954,295) |
Net loss | $ (24,230,220) | $ (17,665,788) |
Net Loss Per Share - Basic and Diluted | ||
Continuing operations (in Dollars per share) | $ (0.97) | $ (0.78) |
Discontinued operations (in Dollars per share) | $ (0.02) | $ (0.04) |
Weighted Average Shares Outstanding - Basic and Diluted (in Shares) | 24,522,912 | 21,329,281 |
Consolidated Statements of Op_2
Consolidated Statements of Operations (Parentheticals) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||
Weighted Average Shares Outstanding – Basic and Diluted | 24,522,912 | 21,329,281 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (24,230,220) | $ (17,665,788) |
Foreign currency translation (loss) gain | (55,557) | 50,844 |
Comprehensive loss | $ (24,285,777) | $ (17,614,944) |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders’ Equity - USD ($) | Common Stock | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Balances at Dec. 31, 2020 | $ 1,964 | $ 102,651,304 | $ (98,234,151) | $ 160,642 | $ 4,579,759 |
Balances (in Shares) at Dec. 31, 2020 | 19,642,401 | ||||
Balances at Dec. 31, 2021 | $ 2,329 | 126,581,702 | (115,899,939) | 211,486 | 10,895,578 |
Balances (in Shares) at Dec. 31, 2021 | 23,294,024 | ||||
Sale of common stock for cash | $ 164 | 10,282,834 | 10,282,998 | ||
Sale of common stock for cash (in Shares) | 1,642,856 | ||||
Stock-based compensation | 6,702,797 | 6,702,797 | |||
Settlement of accrued expense with stock options | 349,376 | 349,376 | |||
Convertible note converted to common stock | $ 117 | 6,232,223 | 6,232,340 | ||
Convertible note converted to common stock (in Shares) | 1,171,296 | ||||
Stock option exercise for cash | $ 1 | 44,493 | $ 44,494 | ||
Stock option exercise for cash (in Shares) | 10,358 | 599,661 | |||
Warrant exercise for cash | $ 7 | 318,751 | $ 318,758 | ||
Warrant exercise for cash (in Shares) | 70,835 | ||||
Cashless stock option exercise | $ 42 | (42) | |||
Cashless stock option exercise (in Shares) | 412,451 | ||||
Cashless warrant exercise | $ 34 | (34) | |||
Cashless warrant exercise (in Shares) | 343,709 | ||||
Fractional shares (in Shares) | 118 | ||||
Net loss | (17,665,788) | (17,665,788) | |||
Foreign currency translation | 50,844 | 50,844 | |||
Balances at Dec. 31, 2022 | $ 2,532 | 140,255,234 | (140,130,159) | 155,929 | 283,536 |
Balances (in Shares) at Dec. 31, 2022 | 25,319,095 | ||||
Sale of common stock for cash | $ 106 | 3,146,834 | 3,146,940 | ||
Sale of common stock for cash (in Shares) | 1,063,514 | ||||
Common stock issued with convertible debt | $ 3 | 91,754 | 91,757 | ||
Common stock issued with convertible debt (in Shares) | 28,496 | ||||
Common stock issued for working capital facility | $ 10 | 302,990 | 303,000 | ||
Common stock issued for working capital facility (in Shares) | 100,000 | ||||
Shares issued in lieu of interest | $ 48 | 696,345 | 696,393 | ||
Shares issued in lieu of interest (in Shares) | 479,845 | ||||
Warrants for services with the issuance of convertible debt | 449,474 | 449,474 | |||
Stock-based compensation | 8,870,168 | 8,870,168 | |||
Convertible note converted to common stock | $ 1 | 49,999 | $ 50,000 | ||
Convertible note converted to common stock (in Shares) | 13,514 | ||||
Stock option exercise for cash (in Shares) | 397,698 | ||||
Warrant exercise for cash | $ 4 | 65,999 | $ 66,003 | ||
Warrant exercise for cash (in Shares) | 36,668 | ||||
Cashless stock option exercise | $ 31 | $ (31) | |||
Cashless stock option exercise (in Shares) | 301,657 | ||||
Cashless warrant exercise (in Shares) | 1,377 | ||||
Net loss | $ (24,230,220) | (24,230,220) | |||
Foreign currency translation | $ (55,557) | $ (55,557) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (24,230,220) | $ (17,665,788) |
Adjustments to reconcile net loss with cash flows from operations: | ||
Loss from sale of discontinued operation | 188,247 | |
Depreciation and amortization expense | 749,900 | 1,157,773 |
Stock-based compensation | 8,870,168 | 6,702,797 |
(Gain) on extinguishment of notes payable | (971,522) | |
Shares issued in lieu of interest | 696,393 | |
Amortization of debt discounts and issuance costs | 595,783 | 237,435 |
Impairment losses | 1,101,867 | 831,077 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (234,962) | (92,905) |
Net investment in direct financing lease | (23,806) | |
Other current assets | 167,877 | (277,191) |
Inventory | 9,745 | |
Accounts payable and accrued expenses | (669,294) | 660,351 |
Deferred revenue | (117,689) | 91,734 |
Other liabilities | (47,809) | |
Discontinued operations | 87,530 | 626,555 |
Net cash flows from operating activities | (12,794,400) | (8,761,554) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sale of discontinued operations, net of selling costs | 146,728 | |
Cash disposed of from the sale of a discontinued operation | (299,505) | |
Purchase of property and equipment | (7,027) | |
Purchase of property and equipment - discontinued operations | (16,159) | (90,036) |
Purchase of intangible assets | (6,311) | (26,705) |
Net cash flows from investing activities | (182,274) | (116,741) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from sale of common stock, net of offering costs | 3,146,940 | 10,282,998 |
Proceeds from issuance of convertible note payable, net of issuance costs | 7,992,841 | |
Proceeds from exercise of warrants | 66,003 | 318,758 |
Proceeds from exercise of stock options | 44,494 | |
Proceeds from paycheck protection program | 485,762 | |
Principal payments on Convertible notes | (662,000) | |
Cash paid for working capital facility | (300,000) | |
Payments on notes payable - discontinued operations | (1,579) | (5,947) |
Principal payments on capital lease obligation - discontinued operations | (10,582) | (39,232) |
Net cash flows from financing activities | 10,231,623 | 11,086,833 |
Effect of Foreign Currencies | (53,123) | 64,168 |
Net Change in Cash | (2,798,174) | 2,272,706 |
Cash, Beginning of the Year | 5,767,276 | 3,506,171 |
Cash, Beginning of the Year- Discontinued Operations | 270,707 | 259,106 |
Cash, End of the Year - Discontinued Operations | (2,703) | (270,707) |
Cash, End of the Year | 3,237,106 | 5,767,276 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid for interest | 94,887 | 7,188 |
Cash paid for interest - discontinued operations | 4,388 | |
Cash paid for income taxes | 7,670 | 11,739 |
Cash paid for income taxes - discontinued operations | 5,627 | 1,149 |
Schedule of Non-cash Investing and Financing Activities: | ||
Cashless option and warrant exercises | 31 | 76 |
Common stock issued with convertible notes | 91,757 | |
Common stock for working capital facility | 303,000 | |
Warrants for services with the issuance of convertible debt | 449,474 | |
Reclass from other assets to intangible assets | 8,270 | |
Settlement of accounts payable with issuance of common stock | 349,376 | |
Conversion of convertible note payable and accrued interest to common stock | $ 50,406 | $ 6,232,340 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 –DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES authID Inc. is a leading provider of secure, authentication solutions delivered by our easy to integrate Verified platform. Our Verified platform that delivers Human Factor Authentication TM Effective July 18, 2022, the Company changed its name to authID Inc. On May 4, 2022, the Board of Directors of authID Inc. approved a plan to exit from certain non-core activities comprising the MultiPay correspondent bank payments services in Colombia and the Cards Plus cards manufacturing and printing business in South Africa (“Cards Plus business”). On August 29, 2022 the Company executed and completed the sale of the Cards Plus business. As of December 31, 2022 and 2021, Cards Plus Pty Ltd., and MultiPay S.A.S., assets are presented as assets held for sale on the Company’s Consolidated Balance Sheets and their operations presented as discontinued operations in the Consolidated Statements of Operations as they met the criteria for discontinued operations under applicable accounting guidance. See Discontinued Operations Note 11 for details. Going Concern These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) assuming the Company will continue on a going concern basis, which implies the Company will continue to meet its obligations and continue its operations for the next year following the issuance date of these consolidated financial statements. As of December 31, 2022, the Company had an accumulated deficit of approximately $140 million. For the year ended December 31, 2022, the Company earned revenue of approximately $527,000, used approximately $12.8 million to fund its operations, and incurred a net loss of approximately $24.2 million. The continuation of the Company as a going concern is dependent upon financial support from the Company’s stockholders and noteholders, the ability of the Company to obtain additional debt or equity financing to continue operations, the Company’s ability to generate sufficient cash flows from operations, successfully locating and negotiating with other business entities for potential acquisition, and acquiring new clients to generate revenues and cash flows. As discussed in the Subsequent Events below, the Company has secured additional financing of $3.6 million which provides funding for its current operations as it continues to invest in its product, people, and technology. The Company projects that the investments will lead to revenue expansion thereby reducing liquidity needs. However, in order to further implement its business plan and satisfy its working capital requirements, the Company will need to raise additional capital. There is no guarantee that the Company will be able to raise additional equity or debt financing at acceptable terms, if at all. There is no assurance that the Company will ever be profitable. These consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern. As there can be no assurance that the Company will be able to achieve positive cash flows (become cash flow profitable) and raise sufficient capital to maintain operations, there is substantial doubt about the Company’s ability to continue as a going concern. Reclassification Certain prior year expenses have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the previously reported loss from continuing operations and management does not believe that this reclassification is material to the consolidated financial statements taken as a whole. Specifically, we reclassified certain expenses from general and administrative expenses to research and development expenses. Subsequent Events On February 14, 2023, the Board of Directors of authID Inc. (the “Company”) resolved to implement a revised budget for 2023 in order to reduce expenses and cash requirements and as part of such revised budget decided to re-balance staffing levels to better align with the evolving needs of the Company (the “Labor Reduction Plan”). Under the Labor Reduction Plan the Company intends that up to 20 of the Company’s 31 employees and contractors be terminated, of which 21 are United States based employees. 12 employees and 6 contractors have been given notice of their termination and the remainder may be terminated over the next several months. The Company has also given termination notice to certain vendors and contractors that provide services to the Company. The Company estimates that it will be incurring costs (in consideration of releases) in the range of $0.5 million to $1.1 million in connection with the Labor Reduction Plan, which are primarily one-time termination benefits and which will result in cash expenditures by the Company in that range of amounts over the coming months. Certain employees have Retention Agreements, which provide for specific benefits upon involuntary termination and the Company is negotiating with those employees over the final amounts and benefits due under those Agreements. On March 21, 2022, the Company entered into a Facility Agreement with Stephen J. Garchik, who was and is a shareholder of the Company, pursuant to which Garchik agreed to provide to the Company a $10.0 million unsecured standby line of credit facility that could be drawn down in several tranches, subject to certain conditions described in the Original Facility Agreement. Pursuant to the Original Facility Agreement, the Company paid Garchik the Facility Commitment Fee of 100,000 shares of our common stock upon the effective date of the Original Facility Agreement. On March 8, 2023, the Company entered into an Amended and Restated Facility Agreement with Garchik, pursuant to which the Company and Garchik amended and restated the Original Facility Agreement in its entirety, to replace the credit facility contemplated by the Original Facility Agreement with (i) an initial credit facility to the Company in an amount of $900,000 and (ii) the parties to use their reasonable best efforts after the Initial Funding to negotiate the terms of a subsequent credit facility in the aggregate amount of $2,700,000. On March 9, 2023, pursuant to the A&R Facility Agreement, the Company entered into the Initial Promissory Note in favor of Garchik, pursuant to which Garchik loaned the Principal Amount of $900,000 to the Company. At the same time, as a condition to Garchik providing the Principal Amount, certain of the Company’s subsidiaries, ID Solutions, Inc., FIN Holdings, Inc. and Innovation in Motion, Inc. entered into the Guaranty of the Initial Promissory Note with Garchik. A&R Facility Agreement Under the A&R Facility Agreement, Garchik agreed to provide the Initial Funding to the Company upon receipt of a fully executed Initial Promissory Note and an executed Release Agreement relating to the Original Facility Agreement. The Company and Garchik agreed to use reasonable best efforts to negotiate the terms of the Subsequent Funding and negotiations continue, but the A&R Facility Agreement will terminate if definitive documentation for the Subsequent Funding is not entered into before July 1, 2023, for any reason other than breach of a party’s obligations. While the terms of the Subsequent Funding are subject to due diligence and final documentation, a summary of selected terms of the proposed financing is as follows and attached to the A&R Facility Agreement as Exhibit B thereto. The Subsequent Funding would be a $2,700,000 secured note facility with a 12% per annum interest rate, paid in kind, capitalized and added to the balance of the loan on a quarterly basis, calculated on a 360-day year basis, on the outstanding aggregate balance of the Subsequent Facility. The Subsequent Facility will mature twenty-four (24) months after effectiveness. Garchik will be granted a fully perfected, non-avoidable, first-priority security interest and lien on all assets of the Company. The Subsequent Facility would be the senior obligation of the Company and will rank senior in right to payment of the obligations under the existing Convertible Notes and the liens granted in connection with the Subsequent Facility shall rank pari passu In satisfaction of a condition precedent to the Initial Funding under the A&R Facility Agreement, Thomas L. Thimot, Phillip L. Kumnick, Philip R. Broenniman, Michael A. Gorriz and Neepa Patel, comprising all directors of the Company’s Board of Directors other than Joseph Trelin, Michael L. Koehneman and Jacqueline L. White, delivered to the Company executed Board Resignation Letters in escrow that became effective as of the Initial Funding. Also in satisfaction of a condition precedent to the Initial Funding under the A&R Facility Agreement, on March 9, 2023, the Board of Directors appointed Joseph Trelin to the Company’s Compensation and Audit Committees, effective as of the Initial Funding. On March 16, 2023, the Board of Directors appointed Joseph Trelin as the Chairman of the Board effective immediately. The A&R Facility Agreement also provided Garchik with the right to nominate four (4) New Designees (not counting any Remaining Directors) to be considered for election to the Board of Directors In satisfaction of a condition precedent to the Initial Funding under the A&R Facility Agreement, as described in greater detail in Item 5.02 of this Current Report, the Board of Directors appointed four (4) New Designees to the Board, effective as of the Initial Funding. The Company also agreed that the Board of Directors would, promptly following the closing of the Initial Funding, evaluate candidates for appointment as replacement of Mr. Thimot as Chief Executive Officer and that, upon the earlier of appointment of a new Chief Executive Officer or April 3, 2023, Mr. Thimot’s resignation letter as Chief Executive Officer will be declared effective. The Company appointed Mr. Daguro as Chief Executive Officer, and Mr. Thimot’s resignation became effective on March 23, 2023. Initial Promissory Note Interest accrues on the Principal Amount until paid in full at a per annum rate equal to 15%, computed on the basis of a 360-day year and twelve 30-day months, payable in arrears on March 31, June 30, September 30 and December 31 of each year commencing March 31, 2023 or the first business day following each such date if any such date falls on a day which is not a business day, in cash. The Principal Amount shall mature on March 31, 2025. The Company made standard (i) affirmative covenants to Garchik, including, but not limited to, in regard to its existence, payment obligations, business activities, financial information and use of proceeds and (ii) negative covenants to Garchik, including, but not limited to, in regard to the rank of indebtedness, incurrence of indebtedness, maintenance of insurance and properties, transactions with affiliates and disposition of assets. While the Initial Promissory Note is unsecured, in the event of either (I) the conversion of the Convertible Notes of all amounts outstanding thereunder and the release of all liens over the Company’s assets granted by and through the Transaction Documents (as defined in the Convertible Notes) or (II) receipt of the consent of the requisite holders of the Convertible Notes, in each case, the Company will, as collateral security for the due and punctual payment and performance of all obligations under the Initial Promissory Note, pledge and assign to Garchik a first-priority, continuing security interest in substantially all of the assets of the Company, subject to exclusions consistent with those contained in the Transaction Documents. The Company has agreed to use its reasonable best efforts to deliver to Garchik an amendment to the Securities Purchase Agreement, dated as of March 21, 2022, pursuant to which the Convertible Notes were purchased, permitting the grant of that collateral security to Garchik. Upon the grant of that collateral security, interest will accrue on the outstanding Principal Amount under the Initial Promissory Note at a per annum rate equal to 12% paid in kind, capitalized and added to the balance of the loan on a quarterly basis, calculated on a 360-day year basis, on the outstanding aggregate balance. The Initial Promissory Note includes customary Events of Default, including, among other things, (i) failing to make payment of any of the Principal Amount or interest due and such failure continues for not less than 5 business days without being cured; (ii) any representation or warranty in the Initial Promissory note being untrue in any material respect and such failure continuing for a period of not less than 5 business days without being cured; or (iii) the Initial Promissory Note shall for any reason cease to be, or shall be asserted by the Company or any affiliate thereof not to be, a legal, valid and binding obligation of the Company. Upon an Event of Default, Garchik can declare all outstanding amounts under the Initial Promissory Note due, along with any accrued interest. Guaranty In connection with the Company and Garchik entering into the Initial Promissory Note, each Guarantor of the Company agreed to, for the benefit and security of Garchik, guarantee the payment and performance all of the Company’s obligations under the Initial Promissory Note and the Guaranty. Release Agreement In connection with the A&R Facility Agreement, on March 9, 2023, the Company and Garchik entered into the Release Agreement, pursuant to which the Company and Garchik mutually agreed to release any and all rights to make a claim against the other and any existing claims against the other arising out of or relating to the Original Facility Agreement. Additional Information The foregoing is only a summary of the material terms of the A&R Facility Agreement, the Initial Promissory Note, the Guaranty, the Release Agreement and the other transaction documents, and does not purport to be a complete description of the rights and obligations of the parties thereunder. The summary of the A&R Facility Agreement, the Initial Promissory Note, the Guaranty, the Release Agreement is qualified in its entirety by reference to the forms of such agreements, which are filed as exhibits to this Annual Report and are incorporated by reference herein. Pursuant to the Nomination Right under the A&R Facility Agreement, Mr. Garchik nominated Rhon Daguro, Ken Jisser, Michael Thompson and Thomas Szoke for appointment to the Board of Directors. On March 9, 2023, the Board of Directors appointed Messrs. Daguro, Jisser, Thompson and Szoke as additional directors of the Company and reduced the size of the Board of Directors from 8 directors to 7 directors, with effect from the resignations of the Retiring Directors. Under the terms of the A&R Facility Agreement, the Nomination Right expired upon the appointment of the four (4) Additional Directors to the Board of Directors. Basis of Consolidation The consolidated financial statements include the accounts of authID Inc. and its wholly-owned subsidiaries MultiPay S.A.S., ID Solutions, Inc., FIN Holdings Inc., Ipsidy Enterprises Limited, Cards Plus Pty Ltd. (through August 29, 2022 when the sale of Cards Plus Pty Ltd. was completed) and authID Gaming Inc. (collectively the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates In preparing these consolidated financial statements in conformity with US GAAP, management is required to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Revenue Recognition Verified Software License The Company had contract liabilities of approximately $81,000 and $199,000 as of December 31, 2022, and 2021 respectively for certain revenue that will be earned in future periods. All deferred revenue contract liabilities as of December 31, 2022 will be earned over the course of the year 2023. The majority of the deferred revenue contract liability as of December 31, 2021, was recognized in the quarter ended March 31, 2022. Furthermore, the Company capitalizes the incremental costs of acquiring and fulfilling a contract with a customer if the Company expects to recover those costs. These incremental costs were immaterial in 2022 and the Company recognizes these costs as incurred as it typically relates to a period of less than 1 year as allowed by the practical expedient. As of December 31, 2022, and December 31, 2021, the Company did not have any deferred contract costs or fees payable. Legacy Authentication Services Accounts Receivable All customers are granted credit on a short-term basis and related credit risks are considered minimal. The Company routinely reviews its trade receivables and makes provisions for probable doubtful accounts; however, those provisions are estimates and actual results could differ from those estimates and those differences may be material. Trade receivables are deemed uncollectible and removed from accounts receivable and the allowance for doubtful accounts when collection efforts have been exhausted. At December 31, 2022 and 2021, management determined no allowance for doubtful accounts was required. Concentration of Credit Risk and Major Customers The Company’s financial instruments that potentially expose the Company to a concentration of credit risk consist of cash and accounts receivable. Cash: 2022 Revenues and accounts receivable: 2021 Revenues and accounts receivable: Income Taxes The Company accounts for income taxes under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 740 “Income Taxes.” Under the asset and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. Leases The Company has an operating lease for its Headquarter office expiring in July 2023 and has a renewal option. The Company does not plan to renew the lease. Property and Equipment, net Property and equipment consist of furniture and fixtures and computer equipment and are stated at cost. Property and equipment are depreciated using the straight-line method over the estimated useful service lives of three to five years. Maintenance and repairs are expensed as incurred and improvements are capitalized. Gains or losses on the disposition of property and equipment are recorded upon disposal. Intangible Assets Intangible assets include when applicable, costs associated with software development of new product offerings and enhancements to existing applications. Research & development costs are expensed as incurred. Development costs of computer software to be sold, leased or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. As of December 31, 2021 and 2022, all assets have been placed into service. As of December 31, 2022 and 2021, the intangible assets approximate $0.6 million and $2.4 million, respectively. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its undiscounted estimated future cash flows, an impairment review is performed. An impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Generally fair value is determined using valuations techniques such as expected discounted cash flows or appraisals, as appropriate. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and are no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheet. During the year ended December 31, 2022, the Company determined that certain intangibles assets are no longer recoverable and recognized impairment expense of approximately $1.1 million. During the year ended December 31, 2021, the Company determined that certain intangibles assets would not be recovered and an impairment expense of approximately $0.8 million was recognized. Goodwill Goodwill is recorded when the purchase price paid for an acquisition exceeds the fair value of net identified tangible and intangible assets acquired. The Company performs an annual impairment test of goodwill and further periodic tests to the extent indicators of impairment develop between annual impairment tests. The Company’s impairment review process compares the fair value of the reporting unit to it carrying value, including the goodwill related to the reporting unit utilizing qualitative considerations. To determine the fair value of the reporting unit, the Company may use various approaches including an asset or cost approach, market approach or income approach or any combination thereof. These approaches may require the Company to make certain estimates and assumptions including future cash flows, revenue and expenses. These estimates and assumptions are reviewed each time the Company tests goodwill for impairment and are typically developed as part of the Company’s routine business planning and forecasting process. While the Company believes its estimates and assumptions are reasonable, variations from those estimates could produce materially different results. During the year ended December 31, 2022, the Company’s projection and assessment did not indicate that an impairment charge was required as its fair value was in excess of carrying value. Stock-based compensation The Company has accounted for stock-based compensation under the provisions of FASB ASC 718 – “Stock Compensation” which requires the use of the fair- value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (stock options and common stock purchase warrants). For all awards, the fair value of each stock option award is estimated on the date of grant using the Black- Scholes and Monte-Carlo valuation models as appropriate that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. Expected volatilities are based on historical volatility of peer companies and other factors estimated over the expected term of the stock options. For employee awards, the expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term. Research and Development Costs Research and development costs consist of expenditures for the research and development of new products and technology. These costs are primarily expenses incurred to perform research projects and develop technology for the Company’s products. Research and development costs are expensed as incurred. Advertising Expenses During the fiscal year 2022 and 2021 the Company incurred approximately $220,000 and $65,000, respectively, in digital marketing expenses to promote our products. Net Loss per Common Share The Company computes net loss per share in accordance with FASB ASC 260, “Earnings per Share”. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the statement of operations. Basic EPS is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible notes and stock warrants, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options, warrants and conversion of convertible notes. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive. The following potentially dilutive securities were excluded from the calculation of diluted loss per share for the years ended December 31, 2022 and 2021 because their effect was antidilutive: 2022 2021 Convertible notes payable 2,466,297 117,529 Warrants 1,229,226 1,403,610 Stock options 10,332,520 8,910,994 14,028,043 10,432,133 Foreign Currency Translation The assets, liabilities and results of operations of certain of authID’s subsidiaries are measured using their functional currency which is the currency of the primary foreign economic environment in which they operate. Upon consolidating these subsidiaries, the applicable assets and liabilities are translated to US dollars at currency exchange rates as of the applicable dates and their revenues and expenses are translated at the weighted average currency exchange rates during the applicable reporting periods. Translation adjustments resulting from the process of translating these subsidiaries’ financial statements are reported in other comprehensive loss in the accompanying consolidated statements of comprehensive loss. |
Other Current Assets and Other
Other Current Assets and Other Assets | 12 Months Ended |
Dec. 31, 2022 | |
Other Current Assets and Other Assets [Abstract] | |
OTHER CURRENT ASSETS AND OTHER ASSETS | NOTE 2 – OTHER CURRENT ASSETS AND OTHER ASSETS Other current assets consisted of the following at December 31, 2022 and 2021: 2022 2021 Prepaid Insurance $ 244,215 $ 223,318 Unamortized working capital facility fees - current 199,156 - Prepaid Third Party Services 135,405 276,085 Other 150,566 3,318 $ 729,342 $ 502,721 Other assets consisted of the following at December 31, 2022 and 2021: OTHER ASSETS 2022 2021 Unamortized working capital facility fees - non current $ 248,945 $ - Other 1,438 2,501 $ 250,383 $ 2,501 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 3 – PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following as of December 31, 2022 and 2021: Estimated Description Useful Lives 2022 2021 Computer Equipment 3 $ 85,583 $ 77,602 Furniture and Equipment 5 54,016 64,841 139,599 142,443 Less: Accumulated Depreciation (139,599 ) (117,044 ) Property and Equipment, Net $ - $ 25,399 Depreciation expense totaled $25,021 and $4,038 for the years ended December 31, 2022 and 2021, respectively. |
Intangible Assets, Net (Other t
Intangible Assets, Net (Other than Goodwill) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets, Net (Other than Goodwill) [Abstract] | |
INTANGIBLE ASSETS, NET (OTHER THAN GOODWILL) | NOTE 4 – INTANGIBLE ASSETS, NET (OTHER THAN GOODWILL) The Company’s intangible assets consist of intellectual property acquired from FIN in addition to internally developed software that have been placed into service. They are amortized over their estimated useful lives as indicated below. The following is a summary of activity related to intangible assets for the years ended December 31, 2022 and 2021: Acquired and Developed Intellectual Software Property Patents Total Useful Lives 5 Years 10 Years 10 Years Carrying Value at December 31, 2020 $ 3,171,394 $ 416,471 $ 128,308 $ 3,716,173 Additions - - 26,705 26,705 Impairment of assets - (335,101 ) - (335,101 ) Amortization (932,512 ) (81,370 ) (14,443 ) (1,028,325 ) Carrying Value at December 31, 2021 2,238,882 - 140,570 2,379,452 Additions - - 6,311 6,311 Impairment of assets (1,107,867 ) - - (1,107,867 ) Amortization (695,420 ) - (16,217 ) (711,637 ) Carrying Value at December 31, 2022 $ 435,595 $ - $ 130,664 $ 566,259 The following is a summary of intangible assets as of December 31, 2022: Acquired and Developed Intellectual Software Property Patents Total Cost $ 4,476,271 $ - $ 164,614 $ 4,640,885 Accumulated amortization (4,040,676 ) - (33,950 ) (4,074,626 ) Carrying Value at December 31, 2022 $ 435,595 $ - $ 130,664 $ 566,259 The following is a summary of intangible assets as of December 31, 2021: Acquired and Developed Intellectual Software Property Patents Total Cost $ 4,476,271 $ - $ 158,303 $ 4,634,574 Accumulated amortization (2,237,389 ) - (17,733 ) (2,255,122 ) Carrying Value at December 31, 2021 $ 2,238,882 $ - $ 140,570 $ 2,379,452 The following is the future amortization of intangible assets for the year ended December 31: 2023 $ 253,080 2024 168,094 2025 63,791 2026 16,456 2027 16,456 Thereafter 48,382 $ 566,259 |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 5 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following as of December 31, 2022 and 2021: 2022 2021 Trade payables $ 623,130 $ 548,087 Accrued interest - 33,553 Accrued payroll and related expenses 145,837 783,144 Other 385,105 413,309 $ 1,154,072 $ 1,778,093 |
Working Capital Facility
Working Capital Facility | 12 Months Ended |
Dec. 31, 2022 | |
Working Capital Faciltiy [Abstract] | |
WORKING CAPITAL FACILITY | NOTE 6 – WORKING CAPITAL FACILITY On March 21, 2022, the Company entered into a Facility Agreement with a current shareholder and noteholder of the Company, pursuant to which the shareholder agreed to provide to the Company a $10.0 million unsecured standby line of credit facility that will rank behind the Convertible Notes (see Note 7) and may be drawn down in several tranches, subject to certain conditions described in the Facility Agreement (the “Credit Facility”). Pursuant to the Credit Facility, the Company agreed to pay a facility commitment fee of 100,000 shares of our common stock upon the effective date of the Credit Facility. There were no borrowings under the Credit Facility as of December 31, 2022. The unamortized deferred debt expense is approximately $448,000 of which $199,000 is included in other current assets and the balance in other assets. As described in the Subsequent Events (see Note 1), the Credit Facility was amended and restated effective March 6, 2023 pursuant to which amendment the amount of the facility was reduced to $3.6 million, an initial advance of $900,000 was made and subsequent advances under the Credit Facility are subject to various conditions including the granting of a security interest over substantially all the Company’s assets. |
Convertible Notes Payable
Convertible Notes Payable | 12 Months Ended |
Dec. 31, 2022 | |
Convertible Notes Payable [Abstract] | |
CONVERTIBLE NOTES PAYABLE | NOTE 7 – CONVERTIBLE NOTES PAYABLE On March 21, 2022, the Company entered into a Securities Purchase Agreement (“SPA”) with certain accredited investors, including certain directors of the Company or their affiliates (the “Note Investors”), and, pursuant to the SPA, sold to the Note Investors Senior Secured Convertible Notes (the “Convertible Notes”) with an aggregate initial principal amount of approximately $9.2 million and a conversion price of $3.70. The Convertible Notes were sold with an aggregate cash origination fee of approximately $200,000, and we issued a total of approximately 28,500 shares of our common stock to the Note Investors as an additional origination fee. The Convertible Notes will accrue interest at the rate of 9.75% per annum, which will be payable in cash or, for some or all of the first five interest payments, in shares of our common stock at the Company’s option, on the last day of each calendar quarter before the maturity date and on the maturity date. The maturity date of the Convertible Notes is March 31, 2025. During the year ended December 31, 2022, a holder of a Convertible Note converted the full principal amount of $50,000 and accrued interest of $406 into 13,514 and 135 shares of our common stock, respectively. During the year ended December 3, 2022, the Company issued 479,845 shares of common stock for approximately $696,000 of interest related to the Convertible Notes. In connection with the issuance of the Convertible Notes, the Company issued 142,690 common stock warrants to the broker and its representatives with an estimated grant date fair value of approximately $449,000 which has been recorded as a reduction in the carrying value of the Convertible Notes. The Company also had a note outstanding to the Stern Trust in the amount of $662,000 that earned interest at 10% per annum. Theodore Stern, the former Trustee of the Stern Trust was formerly a director of the Company. The maturity date of the Stern Note was previously February 29, 2022 and the Stern Trust and the Company mutually agreed to extend the due date to December 31, 2022. The Stern Note was paid in full prior to December 31, 2022. The following is a summary of convertible notes outstanding as of December 31, 2022 and 2021: December 31, December 31, 2022 2021 10% convertible note due December 31, 2022 $ - $ 662,000 9.75% convertible notes due March 31, 2025 9,125,205 - less Unamortized debt discount expense (203,593 ) - Unamortized debt issuance expense (1,080,112 ) - $ 7,841,500 $ 662,000 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 8 – RELATED PARTY TRANSACTIONS 2022 Transactions Convertible Notes Payable During the year ended December 31, 2022, two Directors, an affiliate of one of such Directors and one Executive Officer invested in $1.2 million of the Convertible Notes issued. See Note 7. In connection with the payment of interest on the Convertible Notes, 20,761 shares were issued to two Directors and an affiliate of one of the Directors. Issuance of Common Stock Two Directors and one Executive Officer invested $0.2 million in the common stock offering during the year ended December 31, 2022. See Note 9. Credit Facility On March 21, 2022 the Company entered into a Credit Facility with an accredited investor Mr. Stephen Garchik, who is both a current shareholder of the Company and a Note Investor, pursuant to which the accredited investor agreed to provide a $10.0 million unsecured standby line of credit facility that will rank behind the Convertible Notes and may be drawn down in several tranches, subject to certain conditions described in the Credit Facility. Pursuant to the Credit Facility, the Company agreed to pay the Lender the Facility Commitment Fee of 100,000 shares of our common stock upon the effective date of the Facility Agreement. Upon request by Mr. Garchik and until the full amount due under the Credit Facility is repaid in full, the Company will provide for the nomination of one designee specified in writing by Garchik for appointment to our board of directors and for subsequent election to our board of directors and to recommend such nominee for election to our board of directors. On April 18, 2022, Joseph Trelin, as Garchik’s designee under the Credit Facility, was appointed as a member of the Board of Directors of the Company. By virtue of such right of nomination Mr. Garchik considers himself a “director by deputization”. As described in the Subsequent Events (see Note 1), the Credit Facility was amended and restated effective March 6, 2023 pursuant to which amendment the amount of the facility was reduced to $3.6 million, an initial advance of $900,000 was made and subsequent advances under the Credit Facility are subject to various conditions including the granting of a security interest over substantially all the Company’s assets. Executive Officers On April 25, 2022, Stuart Stoller indicated his intention to resign as Chief Financial Officer of the Company in connection with his planned retirement. The resignation and retirement were effective date of June 17, 2022 at which time Annie Pham was appointed Chief Financial Officer in his place. In connection with his retirement, the Board of Directors approved the vesting of approximately 122,222 stock options which were unvested as of June 17, 2022. Additionally, the Board of Directors approved a consulting arrangement for Mr. Stoller to provide transitional services on an as needed basis. On April 25, 2022, Ms. Pham and the Company entered into an Offer Letter pursuant to which Ms. Pham agreed to serve as Chief Financial Officer commencing June 20, 2022. Ms. Pham receives an annual salary of $275,000. The Company agreed to provide a bonus of 40% of the base salary (pro rated for 2022) based on achievement of performance milestones, calculated and payable in accordance with the corporate milestones approved by the Board for the year 2022. For subsequent fiscal years the bonus shall be subject to performance targets to be mutually agreed with the Compensation Committee of the Board. In addition, Ms. Pham received a signing bonus in the amount of $25,000, which is fully refundable to the Company if Ms. Pham leaves her employment voluntarily or is terminated for cause prior to the first anniversary of the commencement of employment. Upon commencing employment, Ms. Pham was granted an option to acquire 350,000 shares of common stock at an exercise price of $2.41 and an exercise period of ten years subject to certain performance vesting requirements. In December 2022, Ms. Pham was granted an option to acquire 60,000 shares of common stock at an exercise price of $0.79 which will vest on December 31, 2023 with an exercise period of ten years. Board of Directors In April 2022, the Company appointed Joe Trelin as an additional independent director. The Company granted Mr. Trelin options to acquire 100,897 shares of common stock or a total of $270,000 at an exercise price of $3.13 per share for a term of ten years that vest one third per year after each Annual Meeting. In September 2022 the Company granted additional options to acquire 34,996 shares of common stock each at an exercise price of $3.03 per share, to each of the non-employee Directors, by way of annual compensation under the Company’s compensation policy for non-employee directors, which vest monthly over a one-year-period. 2021 Transactions Sale of Common Stock On August 26, 2021, the Company completed the Offering of 1,642,856 shares of its common stock at a public offering price of $7.00 per share, including 214,285 shares sold upon full exercise of the underwriter’s option to purchase additional shares, for gross proceeds of approximately $11.5 million. Two executive officers and three members of the Board of Directors participated in the offering and purchased approximately $1.3 million of common shares. Convertible Notes Payable See discussion in Note 7 regarding the $662,000 Stern Trust Note. Additionally, Theodore Stern and Herbert Selzer (also a former member of the Board of Directors until June 9, 2021) provided conversion notices for their respective 2020 Notes converting the principal, repayment premium and interest in the amount of approximately $256,000 into approximately 41,000 shares of common stock. Executive Officers On June 14, 2021, Phillip L. Kumnick resigned as Chief Executive Officer of authID. Inc and Thomas L. Thimot was appointed Chief Executive Officer in his place. Further, Philip R. Broenniman resigned as President and Chief Operating Officer and Cecil N. Smith III (Tripp) was appointed President and Chief Technology Officer. In May 2021 the Company granted to each of Mr. Kumnick and Mr. Broenniman options (the “May 2021 Options”) to acquire a total of 1,166,667 shares of common stock at an exercise price of $7.20 per share for a term of ten years that vest upon the achievement of certain market capitalization thresholds, or performance conditions. In November 2021 Mr. Kumnick and Mr. Broenniman agreed to cancel 300,000 and 200,000, respectively, of these stock options in consideration of removing certain service conditions. Mr. Thomas Thimot and Mr. Cecil Smith, became employed by the Company as Chief Executive Officer and President and Chief Technology Officer effective June 14, 2021. Mr. Thimot and the Company entered into an Offer Letter pursuant to which Mr. Thimot will earn an annual salary of $325,000 with a bonus target at 50% of the base salary (pro-rated for 2021) upon terms to be agreed with the Compensation Committee for 2021 and on the understanding that the 2022 target will include a requirement of the Company achieving three times the annual revenue of 2021. Additionally, Mr. Thimot was granted an option to acquire 1,200,000 shares of common stock at an exercise price of $7.80 per share for a term of ten years of which half of the options vest monthly over four years and the balance is subject to certain performance vesting requirements. Mr. Thimot resigned effective upon the appointment of Mr. Daguro as Chief Executive Officer on March 23, 2023. On June 14, 2021, Mr. Smith and the Company entered an into an Offer Letter pursuant to which Mr. Smith will earn an annual salary of $275,000 with a bonus target at 50% of the base salary (pro-rated for 2021) upon terms to be agreed with the Compensation Committee for 2021. In addition, Mr. Smith will receive a bonus of $50,000 after 90 days of service. Additionally. Mr. Smith was granted an option to acquire 600,000 shares of common stock at an exercise price of $7.80 per share for a term of ten years of which half of the options vest monthly over four years and the balance is subject to certain performance vesting requirements. On February 15, 2023, Mr. Smith ceased to be an employee, and the President and Chief Technology Officer of the Company. Board of Directors On June 9, 2021 Theodore Stern, Herbert Selzer and Thomas Szoke resigned as directors of the Company. The size of the Board of directors was increased to seven and Dr. Michael A. Gorriz, Michael L. Koehneman, Sanjay Puri, Mr. Thimot and Jacqueline L. White were appointed as additional directors of the Company. Messrs. Stern, Selzer and Szoke did not advise the Company of any disagreement with the Company on any matter relating to its operations, policies or practices. Mr. Szoke continued with the Company as Chief Solutions Architect until December 1, 2021 and entered an agreement with the Company in lieu of his Executive Retention Agreement in which he will receive $305,000 equally on a monthly basis for twelve months. The Company granted each of the four new Directors appointed in June 2021 stock options to acquire 62,500 shares of common stock or a total of 250,000 at an exercise price of $7.80 per share for a term of ten years that vest one third per year after each Annual Meeting. The Company granted the previously serving Directors stock options to acquire 93,470 common shares that were vested upon grant as the services were previously rendered. The stock options were granted in lieu of other forms of Director Compensation. The Company also granted Mr. Selzer and Mr. Stern 22,388 stock options to acquire common shares for service in 2021 prior to their resignation as Directors. Upon their resignation as Directors in June 2021, 13,992 stock options were vested and the balance was cancelled. Additionally, the Company appointed another Director in November 2021 and granted stock options to acquire 29,173 shares of common stock that vest one third a year after each Annual Meeting beginning in 2022. One of the Directors appointed in June did not stand for reelection to the Board of Directors in December 2021 and forfeited 41,667 stock options. In December 2021, the Company granted additional options to acquire 10,238 shares of common stock each to five of the non-employee Directors by way of annual compensation under the Company’s compensation policy for non-employee directors and which vest monthly over a one-year-period. Other In 2021, the Company and Progress Partners Inc. (“Progress”) modified their Business Advisory Agreement dated May 6, 2020 (“Progress Agreement”). The amended Progress Agreement provides for Progress to undertake continuing business development activities for the Company, for which the Company paid Progress $350,000. Additionally, the Company paid Progress, another $115,000 for additional consulting services. Mr. Puri, a former Director of the Company from June 9, to December 29, 2021 is an employee and Managing Director of Progress but is not a principal shareholder nor an executive officer of Progress. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Stockholder's Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 9 – The Company is authorized to issue 250,000,000 shares of common stock. The Company had 25,319,095 and 23,294,024 shares of common stock issued and outstanding as of December 31, 2022 and 2021, respectively. In addition, the Company is authorized to issue 20,000,000 shares of preferred stock but no shares of preferred stock have been issued. Common Stock 2022 Common Stock Transactions ● On March 18 and March 21, 2022, the Company entered into Subscription Agreements (the “Subscription Agreements”) with an accredited investor and certain members of authID’s management team (the “PIPE Investors”), and, pursuant to the Subscription Agreements, sold to the PIPE Investors a total of 1,063,514 shares of our common stock at prices of $3.03 per share for an outside investor and $3.70 per share for the management investors (the “PIPE”). The aggregate gross proceeds from the PIPE are approximately $3.3 million. ● The Company issued a total of 28,496 shares of our common stock to the Note Investors as an additional origination fee. ● On March 21, 2022, the Company entered into a Facility Agreement with a current shareholder and noteholder of the Company, pursuant to which the shareholder agreed to provide the Company a $10.0 million unsecured standby letter of credit facility. Pursuant to the Credit Facility, the Company paid a facility commitment fee of 100,000 shares of our common stock with a fair market value of $3.03 per share upon the effective date of the Credit Facility. ● During the year ended December 31, 2022, a holder of a Convertible Note converted the full principal amount of $50,000 and accrued interest of $406 into 13,514 and 135 shares of our common stock, respectively. ● During the year ended December 3, 2022, the Company issued 479,845 shares of common stock for approximately $696,000 of interest related to the Convertible Notes. See Note 8 for details. ● Certain warrant, stock option and convertible note holders exercised their respective warrants and stock options and conversion right and were issued approximately 353,216 shares of our common stock. 2021 Common Stock Transactions ● On August 26, 2021, the Company completed the Offering, pursuant to a Registration Statement on Form S-1, of 1,642,856 shares of its common stock at a public offering price of $7.00 per share, including 214,285 shares sold upon full exercise of the underwriter’s option to purchase additional shares, for gross proceeds of approximately $11.5 million, before deducting underwriting discounts and offering expenses. ● During 2021, convertible notes totaling approximately $6.2 million and a portion of their accrued interest at the option of the noteholders were converted into approximately 1,171,000 shares of common stock of the Company. ● During 2021, the Company issued approximately 756,000 shares of common stock pursuant to cashless exercises of common stock purchase warrants and options, and approximately 81,000 shares of common stock pursuant to exercises of common stock purchase warrants and options for cash. Warrants ● On March 21, 2022, the Company issued 142,690 common stock warrants in connection with Subscription Agreements and Convertible Notes referenced above with a term of five years and exercise price of $3.70 per share. ● During 2021, under the terms of the Underwriting Agreement in connection with the Offering, the Company issued underwriters warrants (the “Representative’s Warrants”) to purchase an aggregate of 64,286 shares of common stock (4.5% of the total shares issued in the Offering). The Representative’s Warrants are exercisable at a per share price of $8.75 (equal to 125% of the Offering price of the Company’s common stock). The Representative’s Warrants are exercisable for a term of four and one half years beginning on February 23, 2022. See Common Stock Transaction above for a further description of the warrant issuances. The following is a summary of the Company’s warrant activity for the years ended December 31, 2022 and 2021: Weighted Weighted Average Average Number of Exercise Remaining Shares Price Life Outstanding, January 1, 2021 1,823,267 $ 4.20 3.4 Years Granted 64,286 $ 8.75 5.0 Years Exercised/Cancelled (483,943 ) $ 3.22 - Outstanding, December 31, 2021 1,403,610 $ 4.61 3.0 Years Granted 142,690 $ 3.70 5.0 Years Exercised/Cancelled (317,074 ) $ 4.15 0.1 Years Outstanding, December 31, 2022 1,229,226 $ 4.62 2.96 Years Stock Options The Company has adopted the authID 2017 Incentive Stock Plan, and the 2021 Equity Incentive Plan. The Company has no other stock options plans in effect as of December 31, 2022. On September 28, 2017, the shareholders of the Company approved the 2017 Incentive Stock Plan (“2017 Incentive Plan”) and on December 29, 2021, the shareholders of the Company approved the 2021 Equity Incentive Plan. (“2021 Plan”). The following is a summary of principal features of the 2017 Incentive Plan, and the 2021 Plan. The summary, however, does not purport to be a complete description of all the provisions of each plan. The terms of Awards granted under the plans shall be contained in an agreement between the participant and the Company and such terms shall be determined by the Compensation Committee consistent with the provisions of the applicable plan. The terms of Awards may or not require a performance condition in order to vest the equity comprised in the relevant Award. The terms of each Option granted shall be contained in a stock option agreement between the optionee and the Company and such terms shall be determined by the Compensation Committee consistent with the provisions of the applicable plan. The Company has also granted equity awards that have not been approved by security holders. 2022 Stock Option Issuances ● In April 2022, the Company appointed Joe Trelin as an additional independent director. The Company granted Mr. Trelin options to acquire 100,897 shares of common stock or a total of $270,000 at an exercise price of $3.13 per share for a term of ten years that vest one third per year after each Annual Meeting. ● In September 2022 the Company granted additional options to acquire 34,996 shares of common stock valued at $90,000 to each to six of the non-employee Directors, by way of annual compensation under the Company’s compensation policy for non-employee directors, which vest monthly over a one-year-period. ● Additionally, the Company granted 1,674,464 options to acquire common stock to employees. The options for the majority will vest annually over a one year period, 175,000 options vest monthly over a four-year period, and 175,000 performance-based and market-based options vest upon the achievement of certain market capitalization thresholds or performance conditions. 2021 Stock Option Issuances ● The Company granted Mr. Thimot and Mr. Smith stock options to acquire 1,200,000 and 600,000 shares of common stock respectively upon their employment of which half of the options vest monthly over four years and the balance vest upon the achievement of certain market capitalization thresholds or performance conditions. ● The Company granted each of Mr. Kumnick and Mr. Broenniman stock options to acquire 583,333 shares of common stock that vest upon the achievement of certain market capitalization thresholds or performance conditions. In November 2021 Mr. Kumnick and Mr. Broenniman agreed to cancel 300,000 and 200,000, respectively, of these stock options in consideration of removing certain service conditions. ● The Company granted each of the four new Directors appointed June 2021 (“June Directors”) stock options to acquire 62,500 shares of common stock or a total of 250,000 that vest one third a year after each Annual Meeting. Additionally, the Company added another Director in November 2021 and granted stock options to acquire 29,173 shares of common stock that vest one third a year after each Annual Meeting beginning in 2022. One of the June Directors did not stand for reelection to the Board of Directors in December 2021 and forfeited 41,667 stock options. In December 2021, the Company granted additional options to acquire 10,238 shares of common stock to each of the non-employee Directors, by way of annual compensation under the Company’s compensation policy for non-employee directors and which vests monthly over a one-year-period. ● The Company granted the previously serving Directors stock options to acquire 93,470 common shares that are vested as the services were rendered. The stock options were granted in lieu of other forms of Board of Director Compensation and was used to eliminate previously accrued Board of Director compensation. The Company also granted to each of Mr. Selzer and Mr. Stern 22,388 stock options to acquire common shares for service in 2021 prior to their resignation as Directors. Upon their resignation as directors in June 2021, 6,997 stock options to each of them were vested and the balance was cancelled. ● Additionally, the Company granted options to acquire common stock to employees. The options for the majority vest annually over a three-year period, 100,000 vest equally over a four-year period, and the balance of 100,000 vest upon the achievement of certain market capitalization thresholds or performance conditions. The Company determined the grant date fair value of the options granted during the years ended December 31, 2022 and 2021 using the Black Scholes and Monte-Carlo Method as appropriate and the following assumptions: 2022 2021 Expected volatility 123-127 % 70 % Expected term 5 Years 1.0-5.0 Years Risk free rate 2.14-3.75 % 0.16-1.27& Dividend rate 0.00 % 0.00 % Activity related to stock options for the years ended December 31, 2022, and 2021 is summarized as follows: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (Yrs.) Value Outstanding, January 1, 2021 5,645,802 $ 4.50 7.5 $ 8,283,639 Granted 4,583,609 $ 7.56 10.0 $ - Exercised (599,661 ) $ 1.29 5.0 $ 3,485,482 Forfeited/cancelled (718,756 ) $ 6.52 8.8 $ - Outstanding, December 31, 2021 8,910,994 $ 6.48 6.7 $ 67,488,214 Granted 1,985,337 $ 1.61 10.0 $ - Exercised (397,698 ) $ 2.32 8.8 $ - Forfeited/cancelled (166,113 ) $ 6.62 7.9 $ - Outstanding, December 31, 2022 10,332,520 $ 5.81 6.5 $ - Exercisable, December 31, 2022 5,577,259 $ 5.86 4.5 $ - The following table summarizes stock option information as of December 31, 2022: Contractual Exercise Price Outstanding Life (Yrs.) Exercisable $.03 - $4.00 5,103,482 5.9 3,193,783 $4.01 - $7.00 151,667 3.6 151,667 $7.01 - $10.00 3,416,135 8.3 911,966 $10.01 - $15.97 1,661,236 4.9 1,319,843 10,332,520 6.5 5,577,259 As of December 31, 2022, there was approximately $10 million of unrecognized compensation costs related to employee stock options outstanding which will be recognized in 2023 through 2026. The company will recognize forfeitures as they occur. Stock compensation expense for the years ended December 31, 2022, and 2021 was approximately $8.9 million, and $5.5 million, respectively. Additionally, the Company recorded approximately $1,228,000 in 2021 for restricted stock expense in which the Company met certain performance thresholds. The criteria for certain performance-based and market-based stock options awarded in 2022 have not been achieved as of December 31, 2022. |
Income tax
Income tax | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 10 INCOME TAXES The asset and liability method is used in accounting for Income taxes. Deferred tax assets and liabilities are recorded for temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements using the statutory tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax laws or rates is recorded in the results of operations in the period that includes the enactment date under the law. We record Global Intangible Low Tax Income (GILTI) as a current period expense when incurred. We establish valuation allowances for deferred tax assets based on “a more likely than not” standard. Deferred income tax assets are evaluated quarterly to determine if valuation allowances are required or should be adjusted. The ability to realize deferred tax assets depends on the ability to generate sufficient taxable income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction. The assessment regarding whether a valuation allowance is required or should be adjusted also considers all available positive and negative evidence factors. It is difficult to conclude a valuation allowance is not required when there is significant objective and verifiable negative evidence, such as cumulative losses in recent years. We utilize a rolling three years of actual and current year results as the primary measure of cumulative losses in recent years. The Company’s loss before income taxes from US and Foreign sources for the years ended December 31, 2022 and 2021, are as follows: 2022 2021 United States (25,424,002 ) (16,466,423 ) Outside United States 1,208,777 (1,198,341 ) Loss before income taxes (24,215,225 ) (17,664,764 ) The following table summarizes the significant differences between the U.S. Federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31, 2022 and 2021: 2022 2021 US Federal statutory federal income tax 21.00 % 21.00 % State taxes -2.52 % 3.94 % Other deferred adjustments 3.03 % -2.02 % Change in tax rates 0 % -1.53 % Change in valuation allowance -21.5 % -21.39 % Total income tax provision 0 % 0 % The tax effects of temporary differences that give rise to deferred tax assets and liabilities as of December 31, 2022 and 2021 are summarized as follows: 2022 2021 Deferred tax assets Net operating loss 14,997,873 12,702,731 Stock options 7,450,914 5,922,550 Federal tax credits 336,475 303,556 Basis difference in intangible and fixed assets 963,784 (206,925 ) Accrued payroll 11,203 169,242 Capital loss 350,526 - Valuation allowance (24,110,775 ) (18,891,154 ) Deferred tax assets, net - - As of December 31, 2022, the Company has available federal net operating loss carry forward of $63.5 million and state net operating loss carry forwards of $31.9 million. Federal net operating loss carryforwards of approximately $14.4 million will expire through 2037 and the balance of $49.1 million have an indefinite life. Additionally, the Company has income tax net operating loss carryforwards related to our international operations which have an indefinite life. The Company assesses the recoverability of its net operating loss carry forwards and other deferred tax assets and records a valuation allowance to the extent recoverability does not satisfy the “more likely than not” recognition criteria. The Company continues to maintain the valuation allowance until sufficient positive evidence exists to support full or partial reversal. As of December 31, 2022 and 221 the Company had a valuation allowance of approximately $23.8 million and $18.9 million against its deferred tax assets, net of deferred tax liabilities, due to insufficient positive evidence, primarily consisting of losses within the taxing jurisdictions that have tax attributes and deferred tax assets. |
Discontinued Operations and Ass
Discontinued Operations and Assets Held for Sale | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations and Assets Held for Sale [Abstract] | |
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE | NOTE 11 – DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE The Board of Directors of authID considers it in the best interests of the Company to focus its business activities on providing biometric authentication products and services by means of our proprietary Verified platform. Accordingly, on May 4, 2022, the Board approved a plan to exit from certain non-core activities comprising the MultiPay correspondent bank, payments services in Colombia and the Cards Plus cards manufacturing and printing business in South Africa. Cards Plus business in South Africa The financial statements of Cards Plus are classified as a discontinued operation and an asset held for sale, as all required classification criteria under appropriate accounting standards were met as of December 31, 2022. On August 29, 2022, the Company completed the sale of Cards Plus for a price of $300,000 of which $150,000 was received and the remaining balance of $150,000 recorded in other current assets is expected to be received within one year, less $3,272 in costs to sell, and recognized a loss of $188,247 from the transaction. The following table summarizes the assets and liabilities of the Cards Plus sale and the consideration received: Carrying value of net assets sold: Amount Cash $ 299,505 Accounts receivable 61,879 Inventory 231,955 Other current assets 1,490 Total current assets 594,829 Property and equipment 21,127 Total assets 615,956 Accounts payable 76,094 Accrued expenses 43,728 Deferred revenue 11,159 Total current liabilities 130,981 Net assets sold $ 484,975 Sale Consideration on disposition of net assets: Proceeds $ 300,000 Legal fee (5,511 ) Write off net payable with CP 2,239 Net Consideration 296,728 Net loss on sale of a discontinued operation $ (188,247 ) MultiPay business in Colombia The Company is exiting the MultiPay business in Colombia in an orderly fashion, honoring our obligations to employees, customers and under applicable laws and regulations. We maintain our customer support and operations team in Bogota, which performs essential functions to support the global operations of our Verified product. As of December 31, 2022, all impacted employees left the Company. The Company also paid to each employee their severance packages under the MultiPay’s retention plan and obligations under the appropriate statutes. As of December 31, 2022, MultiPay is working with a major customer to implement a transition plan to provide an essential service for certain bill pay services which will likely result in the sale of the Company’s proprietary software as well as the assumption of certain expenses. The Company incurred costs of $196,500 which was paid as of December 31, 2022 associated with the exit of the MultiPay business and approximately $41,000 for accelerated amortization (non-cash) for certain technology licenses. MultiPay has accelerated the depreciation of certain assets with the effective date of the announcement to reflect the estimated remaining useful life. The operations of Cards Plus and MultiPay for the years ended December 31, 2022 and 2021 on a consolidated basis are below: For the Year Ended Discontinued Operations 2022 2021 Discontinued Operations Total Revenues, net $ 1,503,333 $ 1,678,780 Operating Expenses: Cost of sales 665,269 653,773 General and administrative 1,021,649 1,892,783 Impairment loss 143,698 - Depreciation and amortization 41,850 102,513 Total operating expenses 1,872,466 2,649,069 Loss from operations (369,133 ) (970,289 ) Other Income (Expense): Other income 10,161 27,188 Interest expense, net (364 ) (5,164 ) Other income, net 9,797 22,024 Loss before income taxes (359,336 ) (948,265 ) Income tax expense (7,327 ) (6,030 ) Loss from discontinued operations (366,663 ) (954,295 ) Loss from sale of discontinued operations (188,247 ) - Total loss from discontinued operations $ (554,910 ) $ (954,295 ) For the Year Ended 2022 2021 Cards Plus Total Revenues, net $ 1,263,672 $ 1,318,029 Operating Expenses: Cost of sales 665,269 653,773 General and administrative 412,243 606,110 Impairment loss 143,698 - Depreciation and amortization 24,451 80,692 Total operating expenses 1,245,661 1,340,575 Income (Loss) from operations 18,011 (22,546 ) Other Income (Expense): Other income (expense), net 8,919 6,867 Interest expense, net (364 ) (5,164 ) Other income, net 8,555 1,703 Income (Loss) before income taxes 26,566 (20,843 ) Income tax expense (4,681 ) - Income (Loss) from discontinued operations 21,885 (20,843 ) Loss from sale of discontinued operations (188,247 ) - Total income (loss) from discontinued operations $ (166,362 ) $ (20,843 ) For the Year Ended 2022 2021 MultiPay Total Revenues, net $ 239,661 $ 360,751 Operating Expenses: General and administrative 609,406 1,286,673 Depreciation and amortization 17,399 21,821 Total operating expenses 626,805 1,308,494 Loss from operations (387,144 ) (947,743 ) Other Income: Other income, net 1,242 20,321 Other income 1,242 20,321 Loss before income taxes (385,902 ) (927,422 ) Income tax expense (2,646 ) (6,030 ) Loss from discontinued operations $ (388,548 ) $ (933,452 ) As a result of meeting the discontinued operations/assets held for sale criteria for Cards Plus and the MultiPay operations, the assets and liabilities have been reclassified as assets held for sale as of the respective balance sheet date as follows: December 31, December 31 Discontinued Operations Current Assets: Cash $ 2,703 $ 270,707 Accounts receivable, net 105,194 110,977 Inventory - 153,149 Other current assets 10,562 94,919 Current assets held for sale 118,459 629,752 Noncurrent Assets: Property and equipment, net 27,595 93,132 Intangible assets - 153,004 Other assets - 66,695 Noncurrent assets held for sale 27,595 312,831 Total assets held for sale $ 146,054 $ 942,583 Current Liabilities: Accounts payable and accrued expenses $ 13,759 $ 235,348 Deferred revenue - 47,823 Notes payable obligation, current portion - 1,579 Capital lease obligation, current portion - 10,562 Total liabilities held for sale $ 13,759 $ 295,312 December 31, December 31 Cards Plus Current Assets: Cash $ - $ 182,518 Accounts receivable, net - 88,235 Inventory - 153,149 Other current assets - 52,678 Current assets held for sale - 476,580 Noncurrent Assets: Property and equipment, net - 24,619 Intangible assets - 153,004 Noncurrent assets held for sale - 177,623 Total assets held for sale $ - $ 654,203 Current Liabilities: Accounts payable and accrued expenses $ - $ 122,725 Deferred revenue - 47,823 Notes payable obligation, current portion - 1,579 Capital lease obligation, current portion - 1,056 Total liabilities held for sale $ - $ 173,183 December 31, December 31 MultiPay Current Assets: Cash $ 2,703 $ 88,189 Accounts receivable, net 105,194 22,742 Other current assets 10,562 42,241 Current assets held for sale 118,459 153,172 Noncurrent Assets: Property and equipment, net 27,595 68,513 Other assets - 66,695 Noncurrent assets held for sale 27,595 135,208 Total assets held for sale $ 146,054 $ 288,380 Current Liabilities: Accounts payable and accrued expenses $ 13,759 $ 112,623 Total liabilities held for sale $ 13,759 $ 112,623 As a result of meeting the discontinued operations/assets held for sale criteria for Cards Plus and the MultiPay operations, the cash flow activity related to discontinued operations is presented separately on the statement of cash flows as summarized below: Year Ended December 31, 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (366,663 ) $ (954,295 ) Adjustments to reconcile net loss with cash flows from operations: Depreciation and amortization expense 41,850 102,513 Impairment of intangible assets 143,698 - Provision of Net Investment in direct financing lease - 422,022 Changes in operating assets and liabilities: Accounts receivable (50,598 ) 18,722 Net investment in direct financing lease - 96,487 Other current assets 170,536 88,345 Inventory (78,806 ) 96,930 Accounts payable and accrued expenses (102,486 ) (115,870 ) Deferred revenue (36,664 ) (82,594 ) Adjustments relating to discontinued operations 87,530 626,555 Net cash flows from discontinued operations $ (279,133 ) $ (327,740 ) Notes to Financial Statements – Discontinued Operations Inventories Inventory of plastic/ID cards, digital printing material, which were held by Cards Plus Pty Ltd., were at the lower of cost (using the average method) or market. As of December 31, 2021, the Company recorded an inventory valuation allowance of approximately $20,000 to reflect net realizable value of the cards inventory. Any adjustments to reduce the cost of inventories to their net realizable value are recognized in earnings in the current period. As of December 31, 2022, inventories decreased to zero as the Company completed the sale of Cards Plus business on August 29, 2022. Revenue Recognition Cards Plus – The Company recognized revenue for the design and production of cards at the point in time when products are shipped, or services have been performed due to the short-term nature of the contracts. Additionally, the cards produced by the Company have no alternative use and the Company has an enforceable right to payment for work performed should the contract be cancelled. As of December 31, 2021, Cards Plus had approximately $48,000 of contract liability from payments received in advance that will be earned in future periods. Contract liability decreased to zero as the Company completed the sale of Cards Plus business on August 29, 2022. MultiPay recognizes revenue for variable fees generated for payment processing solutions that are earned on a usage fee over time based on monthly transaction volumes or on a monthly flat fee rate. Additionally, MultiPay also sells certain equipment from time to time for which revenue is recognized upon delivery to the customer. Revenue related to direct financing leases is outside the scope of Topic 606 and is recognized over the term of the lease using the effective interest method. Impairment loss During the year ended December 31, 2022, Cards Plus recorded an impairment loss of zero and approximately $143,000, respectively associated with its intangible assets. Leases In October 2021, MultiPay entered into a one-year lease for approximately $2,900 per month in Bogota, Colombia. MultiPay terminated the lease as of September 30, 2022. Cards Plus leased space for its operations in South Africa. The facility was rented on a month-to-month basis with monthly rent of approximately $8,000 through August 29, 2022 as the Company completed the sale of Cards Plus business. Cards Plus entered into a lease in March 2017 for the rental of its printer for its secured plastic and credential card products business under an arrangement that is classified as a finance lease. The leased equipment was amortized on a straight-line basis over its lease term including the last payment (61 payments) and ownership transferred to the Company. The lease was fully paid off. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 12 – Legal Matters From time to time the Company is a party to various legal or administrative proceedings arising in the ordinary course of our business. While any litigation contains an element of uncertainty, we have no reason to believe that the outcome of such proceedings will have a material adverse effect on the financial condition or results of operations of the Company. Executive Compensation As of December 31, 2022, Starting in fiscal year 2022 the Company adopted the new 401 (k) plan where employer matches 100% of the employees contribution up to 3% of their salaries and 50% of the employee’s contribution (including both executives and other employees) between greater than 3% and less than 5% of their salaries. Leases The lease related balances included in the Consolidated Balance Sheet as of December 31, 2022 and 2021 were as follows: 2022 2021 Current portion of operating lease ROU assets - included in current assets held for sale $ - $ 76,454 Total operating lease assets $ - $ 76,454 Liabilities Current portion of ROU liabilities - included in current liabilities held for sale $ - $ 69,812 Total operating lease liabilities $ - $ 69,812 The Company rented office space in Long Beach, New York at a monthly cost of $2,500 in 2022 and 2021, respectively. The agreement is month to month and could be terminated on 30 days notice. The lease agreement was terminated in July 2022. The agreement was between the Company and Bridgeworks LLC, an entity principally owned by Mr. Beck, our former CEO and Director and his family. In July 2022, the Company signed a new lease agreement for one year and moved its headquarters to Denver, Colorado. The office monthly lease cost is approximately $1,500 per month. Rent expense included in general and administrative on the Consolidated Statements of Operations for the years ended December 31, 2022 and 2021 was approximately $25,000 and $47,000, respectively. Rent expense included in loss from discontinued operations on the Consolidated Statements of Operations for the years ended December 31, 2022 and 2021 was approximately $90,000 and $140,000, respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 13 – SEGMENT INFORMATION Operating segments are defined as components of an enterprise for which separate financial information is available and which is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. As a result of the decision to exit the Cards Plus and Multipay businesses in May 2022, the Company only has one segment which is the verified authentication business. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Going Concern | Going Concern These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) assuming the Company will continue on a going concern basis, which implies the Company will continue to meet its obligations and continue its operations for the next year following the issuance date of these consolidated financial statements. As of December 31, 2022, the Company had an accumulated deficit of approximately $140 million. For the year ended December 31, 2022, the Company earned revenue of approximately $527,000, used approximately $12.8 million to fund its operations, and incurred a net loss of approximately $24.2 million. The continuation of the Company as a going concern is dependent upon financial support from the Company’s stockholders and noteholders, the ability of the Company to obtain additional debt or equity financing to continue operations, the Company’s ability to generate sufficient cash flows from operations, successfully locating and negotiating with other business entities for potential acquisition, and acquiring new clients to generate revenues and cash flows. As discussed in the Subsequent Events below, the Company has secured additional financing of $3.6 million which provides funding for its current operations as it continues to invest in its product, people, and technology. The Company projects that the investments will lead to revenue expansion thereby reducing liquidity needs. However, in order to further implement its business plan and satisfy its working capital requirements, the Company will need to raise additional capital. There is no guarantee that the Company will be able to raise additional equity or debt financing at acceptable terms, if at all. There is no assurance that the Company will ever be profitable. These consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern. As there can be no assurance that the Company will be able to achieve positive cash flows (become cash flow profitable) and raise sufficient capital to maintain operations, there is substantial doubt about the Company’s ability to continue as a going concern. |
Reclassification | Reclassification Certain prior year expenses have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the previously reported loss from continuing operations and management does not believe that this reclassification is material to the consolidated financial statements taken as a whole. Specifically, we reclassified certain expenses from general and administrative expenses to research and development expenses. |
Subsequent Events | Subsequent Events On February 14, 2023, the Board of Directors of authID Inc. (the “Company”) resolved to implement a revised budget for 2023 in order to reduce expenses and cash requirements and as part of such revised budget decided to re-balance staffing levels to better align with the evolving needs of the Company (the “Labor Reduction Plan”). Under the Labor Reduction Plan the Company intends that up to 20 of the Company’s 31 employees and contractors be terminated, of which 21 are United States based employees. 12 employees and 6 contractors have been given notice of their termination and the remainder may be terminated over the next several months. The Company has also given termination notice to certain vendors and contractors that provide services to the Company. The Company estimates that it will be incurring costs (in consideration of releases) in the range of $0.5 million to $1.1 million in connection with the Labor Reduction Plan, which are primarily one-time termination benefits and which will result in cash expenditures by the Company in that range of amounts over the coming months. Certain employees have Retention Agreements, which provide for specific benefits upon involuntary termination and the Company is negotiating with those employees over the final amounts and benefits due under those Agreements. On March 21, 2022, the Company entered into a Facility Agreement with Stephen J. Garchik, who was and is a shareholder of the Company, pursuant to which Garchik agreed to provide to the Company a $10.0 million unsecured standby line of credit facility that could be drawn down in several tranches, subject to certain conditions described in the Original Facility Agreement. Pursuant to the Original Facility Agreement, the Company paid Garchik the Facility Commitment Fee of 100,000 shares of our common stock upon the effective date of the Original Facility Agreement. On March 8, 2023, the Company entered into an Amended and Restated Facility Agreement with Garchik, pursuant to which the Company and Garchik amended and restated the Original Facility Agreement in its entirety, to replace the credit facility contemplated by the Original Facility Agreement with (i) an initial credit facility to the Company in an amount of $900,000 and (ii) the parties to use their reasonable best efforts after the Initial Funding to negotiate the terms of a subsequent credit facility in the aggregate amount of $2,700,000. On March 9, 2023, pursuant to the A&R Facility Agreement, the Company entered into the Initial Promissory Note in favor of Garchik, pursuant to which Garchik loaned the Principal Amount of $900,000 to the Company. At the same time, as a condition to Garchik providing the Principal Amount, certain of the Company’s subsidiaries, ID Solutions, Inc., FIN Holdings, Inc. and Innovation in Motion, Inc. entered into the Guaranty of the Initial Promissory Note with Garchik. A&R Facility Agreement Under the A&R Facility Agreement, Garchik agreed to provide the Initial Funding to the Company upon receipt of a fully executed Initial Promissory Note and an executed Release Agreement relating to the Original Facility Agreement. The Company and Garchik agreed to use reasonable best efforts to negotiate the terms of the Subsequent Funding and negotiations continue, but the A&R Facility Agreement will terminate if definitive documentation for the Subsequent Funding is not entered into before July 1, 2023, for any reason other than breach of a party’s obligations. While the terms of the Subsequent Funding are subject to due diligence and final documentation, a summary of selected terms of the proposed financing is as follows and attached to the A&R Facility Agreement as Exhibit B thereto. The Subsequent Funding would be a $2,700,000 secured note facility with a 12% per annum interest rate, paid in kind, capitalized and added to the balance of the loan on a quarterly basis, calculated on a 360-day year basis, on the outstanding aggregate balance of the Subsequent Facility. The Subsequent Facility will mature twenty-four (24) months after effectiveness. Garchik will be granted a fully perfected, non-avoidable, first-priority security interest and lien on all assets of the Company. The Subsequent Facility would be the senior obligation of the Company and will rank senior in right to payment of the obligations under the existing Convertible Notes and the liens granted in connection with the Subsequent Facility shall rank pari passu In satisfaction of a condition precedent to the Initial Funding under the A&R Facility Agreement, Thomas L. Thimot, Phillip L. Kumnick, Philip R. Broenniman, Michael A. Gorriz and Neepa Patel, comprising all directors of the Company’s Board of Directors other than Joseph Trelin, Michael L. Koehneman and Jacqueline L. White, delivered to the Company executed Board Resignation Letters in escrow that became effective as of the Initial Funding. Also in satisfaction of a condition precedent to the Initial Funding under the A&R Facility Agreement, on March 9, 2023, the Board of Directors appointed Joseph Trelin to the Company’s Compensation and Audit Committees, effective as of the Initial Funding. On March 16, 2023, the Board of Directors appointed Joseph Trelin as the Chairman of the Board effective immediately. The A&R Facility Agreement also provided Garchik with the right to nominate four (4) New Designees (not counting any Remaining Directors) to be considered for election to the Board of Directors In satisfaction of a condition precedent to the Initial Funding under the A&R Facility Agreement, as described in greater detail in Item 5.02 of this Current Report, the Board of Directors appointed four (4) New Designees to the Board, effective as of the Initial Funding. The Company also agreed that the Board of Directors would, promptly following the closing of the Initial Funding, evaluate candidates for appointment as replacement of Mr. Thimot as Chief Executive Officer and that, upon the earlier of appointment of a new Chief Executive Officer or April 3, 2023, Mr. Thimot’s resignation letter as Chief Executive Officer will be declared effective. The Company appointed Mr. Daguro as Chief Executive Officer, and Mr. Thimot’s resignation became effective on March 23, 2023. Initial Promissory Note Interest accrues on the Principal Amount until paid in full at a per annum rate equal to 15%, computed on the basis of a 360-day year and twelve 30-day months, payable in arrears on March 31, June 30, September 30 and December 31 of each year commencing March 31, 2023 or the first business day following each such date if any such date falls on a day which is not a business day, in cash. The Principal Amount shall mature on March 31, 2025. The Company made standard (i) affirmative covenants to Garchik, including, but not limited to, in regard to its existence, payment obligations, business activities, financial information and use of proceeds and (ii) negative covenants to Garchik, including, but not limited to, in regard to the rank of indebtedness, incurrence of indebtedness, maintenance of insurance and properties, transactions with affiliates and disposition of assets. While the Initial Promissory Note is unsecured, in the event of either (I) the conversion of the Convertible Notes of all amounts outstanding thereunder and the release of all liens over the Company’s assets granted by and through the Transaction Documents (as defined in the Convertible Notes) or (II) receipt of the consent of the requisite holders of the Convertible Notes, in each case, the Company will, as collateral security for the due and punctual payment and performance of all obligations under the Initial Promissory Note, pledge and assign to Garchik a first-priority, continuing security interest in substantially all of the assets of the Company, subject to exclusions consistent with those contained in the Transaction Documents. The Company has agreed to use its reasonable best efforts to deliver to Garchik an amendment to the Securities Purchase Agreement, dated as of March 21, 2022, pursuant to which the Convertible Notes were purchased, permitting the grant of that collateral security to Garchik. Upon the grant of that collateral security, interest will accrue on the outstanding Principal Amount under the Initial Promissory Note at a per annum rate equal to 12% paid in kind, capitalized and added to the balance of the loan on a quarterly basis, calculated on a 360-day year basis, on the outstanding aggregate balance. The Initial Promissory Note includes customary Events of Default, including, among other things, (i) failing to make payment of any of the Principal Amount or interest due and such failure continues for not less than 5 business days without being cured; (ii) any representation or warranty in the Initial Promissory note being untrue in any material respect and such failure continuing for a period of not less than 5 business days without being cured; or (iii) the Initial Promissory Note shall for any reason cease to be, or shall be asserted by the Company or any affiliate thereof not to be, a legal, valid and binding obligation of the Company. Upon an Event of Default, Garchik can declare all outstanding amounts under the Initial Promissory Note due, along with any accrued interest. Guaranty In connection with the Company and Garchik entering into the Initial Promissory Note, each Guarantor of the Company agreed to, for the benefit and security of Garchik, guarantee the payment and performance all of the Company’s obligations under the Initial Promissory Note and the Guaranty. Release Agreement In connection with the A&R Facility Agreement, on March 9, 2023, the Company and Garchik entered into the Release Agreement, pursuant to which the Company and Garchik mutually agreed to release any and all rights to make a claim against the other and any existing claims against the other arising out of or relating to the Original Facility Agreement. Additional Information The foregoing is only a summary of the material terms of the A&R Facility Agreement, the Initial Promissory Note, the Guaranty, the Release Agreement and the other transaction documents, and does not purport to be a complete description of the rights and obligations of the parties thereunder. The summary of the A&R Facility Agreement, the Initial Promissory Note, the Guaranty, the Release Agreement is qualified in its entirety by reference to the forms of such agreements, which are filed as exhibits to this Annual Report and are incorporated by reference herein. Pursuant to the Nomination Right under the A&R Facility Agreement, Mr. Garchik nominated Rhon Daguro, Ken Jisser, Michael Thompson and Thomas Szoke for appointment to the Board of Directors. On March 9, 2023, the Board of Directors appointed Messrs. Daguro, Jisser, Thompson and Szoke as additional directors of the Company and reduced the size of the Board of Directors from 8 directors to 7 directors, with effect from the resignations of the Retiring Directors. Under the terms of the A&R Facility Agreement, the Nomination Right expired upon the appointment of the four (4) Additional Directors to the Board of Directors. |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of authID Inc. and its wholly-owned subsidiaries MultiPay S.A.S., ID Solutions, Inc., FIN Holdings Inc., Ipsidy Enterprises Limited, Cards Plus Pty Ltd. (through August 29, 2022 when the sale of Cards Plus Pty Ltd. was completed) and authID Gaming Inc. (collectively the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates In preparing these consolidated financial statements in conformity with US GAAP, management is required to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Revenue Recognition | Revenue Recognition Verified Software License The Company had contract liabilities of approximately $81,000 and $199,000 as of December 31, 2022, and 2021 respectively for certain revenue that will be earned in future periods. All deferred revenue contract liabilities as of December 31, 2022 will be earned over the course of the year 2023. The majority of the deferred revenue contract liability as of December 31, 2021, was recognized in the quarter ended March 31, 2022. Furthermore, the Company capitalizes the incremental costs of acquiring and fulfilling a contract with a customer if the Company expects to recover those costs. These incremental costs were immaterial in 2022 and the Company recognizes these costs as incurred as it typically relates to a period of less than 1 year as allowed by the practical expedient. As of December 31, 2022, and December 31, 2021, the Company did not have any deferred contract costs or fees payable. Legacy Authentication Services |
Accounts Receivable | Accounts Receivable All customers are granted credit on a short-term basis and related credit risks are considered minimal. The Company routinely reviews its trade receivables and makes provisions for probable doubtful accounts; however, those provisions are estimates and actual results could differ from those estimates and those differences may be material. Trade receivables are deemed uncollectible and removed from accounts receivable and the allowance for doubtful accounts when collection efforts have been exhausted. At December 31, 2022 and 2021, management determined no allowance for doubtful accounts was required. |
Concentration of Credit Risk and Major Customers | Concentration of Credit Risk and Major Customers The Company’s financial instruments that potentially expose the Company to a concentration of credit risk consist of cash and accounts receivable. Cash: 2022 Revenues and accounts receivable: 2021 Revenues and accounts receivable: |
Income Taxes | Income Taxes The Company accounts for income taxes under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 740 “Income Taxes.” Under the asset and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. |
Leases | Leases The Company has an operating lease for its Headquarter office expiring in July 2023 and has a renewal option. The Company does not plan to renew the lease. |
Property and Equipment, net | Property and Equipment, net Property and equipment consist of furniture and fixtures and computer equipment and are stated at cost. Property and equipment are depreciated using the straight-line method over the estimated useful service lives of three to five years. Maintenance and repairs are expensed as incurred and improvements are capitalized. Gains or losses on the disposition of property and equipment are recorded upon disposal. |
Intangible Assets | Intangible Assets Intangible assets include when applicable, costs associated with software development of new product offerings and enhancements to existing applications. Research & development costs are expensed as incurred. Development costs of computer software to be sold, leased or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. As of December 31, 2021 and 2022, all assets have been placed into service. As of December 31, 2022 and 2021, the intangible assets approximate $0.6 million and $2.4 million, respectively. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its undiscounted estimated future cash flows, an impairment review is performed. An impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Generally fair value is determined using valuations techniques such as expected discounted cash flows or appraisals, as appropriate. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell and are no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheet. During the year ended December 31, 2022, the Company determined that certain intangibles assets are no longer recoverable and recognized impairment expense of approximately $1.1 million. During the year ended December 31, 2021, the Company determined that certain intangibles assets would not be recovered and an impairment expense of approximately $0.8 million was recognized. |
Goodwill | Goodwill Goodwill is recorded when the purchase price paid for an acquisition exceeds the fair value of net identified tangible and intangible assets acquired. The Company performs an annual impairment test of goodwill and further periodic tests to the extent indicators of impairment develop between annual impairment tests. The Company’s impairment review process compares the fair value of the reporting unit to it carrying value, including the goodwill related to the reporting unit utilizing qualitative considerations. To determine the fair value of the reporting unit, the Company may use various approaches including an asset or cost approach, market approach or income approach or any combination thereof. These approaches may require the Company to make certain estimates and assumptions including future cash flows, revenue and expenses. These estimates and assumptions are reviewed each time the Company tests goodwill for impairment and are typically developed as part of the Company’s routine business planning and forecasting process. While the Company believes its estimates and assumptions are reasonable, variations from those estimates could produce materially different results. During the year ended December 31, 2022, the Company’s projection and assessment did not indicate that an impairment charge was required as its fair value was in excess of carrying value. |
Stock-based compensation | Stock-based compensation The Company has accounted for stock-based compensation under the provisions of FASB ASC 718 – “Stock Compensation” which requires the use of the fair- value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (stock options and common stock purchase warrants). For all awards, the fair value of each stock option award is estimated on the date of grant using the Black- Scholes and Monte-Carlo valuation models as appropriate that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. Expected volatilities are based on historical volatility of peer companies and other factors estimated over the expected term of the stock options. For employee awards, the expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term. |
Research and Development Costs | Research and Development Costs Research and development costs consist of expenditures for the research and development of new products and technology. These costs are primarily expenses incurred to perform research projects and develop technology for the Company’s products. Research and development costs are expensed as incurred. |
Advertising Expenses | Advertising Expenses During the fiscal year 2022 and 2021 the Company incurred approximately $220,000 and $65,000, respectively, in digital marketing expenses to promote our products. |
Net Loss per Common Share | Net Loss per Common Share The Company computes net loss per share in accordance with FASB ASC 260, “Earnings per Share”. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the statement of operations. Basic EPS is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible notes and stock warrants, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options, warrants and conversion of convertible notes. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive. The following potentially dilutive securities were excluded from the calculation of diluted loss per share for the years ended December 31, 2022 and 2021 because their effect was antidilutive: 2022 2021 Convertible notes payable 2,466,297 117,529 Warrants 1,229,226 1,403,610 Stock options 10,332,520 8,910,994 14,028,043 10,432,133 |
Foreign Currency Translation | Foreign Currency Translation The assets, liabilities and results of operations of certain of authID’s subsidiaries are measured using their functional currency which is the currency of the primary foreign economic environment in which they operate. Upon consolidating these subsidiaries, the applicable assets and liabilities are translated to US dollars at currency exchange rates as of the applicable dates and their revenues and expenses are translated at the weighted average currency exchange rates during the applicable reporting periods. Translation adjustments resulting from the process of translating these subsidiaries’ financial statements are reported in other comprehensive loss in the accompanying consolidated statements of comprehensive loss. |
Description of Business and S_2
Description of Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of calculation of diluted loss per share | 2022 2021 Convertible notes payable 2,466,297 117,529 Warrants 1,229,226 1,403,610 Stock options 10,332,520 8,910,994 14,028,043 10,432,133 |
Other Current Assets and Othe_2
Other Current Assets and Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Current Assets and Other Assets [Abstract] | |
Schedule of other current assets | 2022 2021 Prepaid Insurance $ 244,215 $ 223,318 Unamortized working capital facility fees - current 199,156 - Prepaid Third Party Services 135,405 276,085 Other 150,566 3,318 $ 729,342 $ 502,721 |
Schedule of other assets | OTHER ASSETS 2022 2021 Unamortized working capital facility fees - non current $ 248,945 $ - Other 1,438 2,501 $ 250,383 $ 2,501 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Estimated Description Useful Lives 2022 2021 Computer Equipment 3 $ 85,583 $ 77,602 Furniture and Equipment 5 54,016 64,841 139,599 142,443 Less: Accumulated Depreciation (139,599 ) (117,044 ) Property and Equipment, Net $ - $ 25,399 |
Intangible Assets, Net (Other_2
Intangible Assets, Net (Other than Goodwill) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets, Net (Other than Goodwill) [Abstract] | |
Schedule of intangible assets, net | Acquired and Developed Intellectual Software Property Patents Total Useful Lives 5 Years 10 Years 10 Years Carrying Value at December 31, 2020 $ 3,171,394 $ 416,471 $ 128,308 $ 3,716,173 Additions - - 26,705 26,705 Impairment of assets - (335,101 ) - (335,101 ) Amortization (932,512 ) (81,370 ) (14,443 ) (1,028,325 ) Carrying Value at December 31, 2021 2,238,882 - 140,570 2,379,452 Additions - - 6,311 6,311 Impairment of assets (1,107,867 ) - - (1,107,867 ) Amortization (695,420 ) - (16,217 ) (711,637 ) Carrying Value at December 31, 2022 $ 435,595 $ - $ 130,664 $ 566,259 Acquired and Developed Intellectual Software Property Patents Total Cost $ 4,476,271 $ - $ 164,614 $ 4,640,885 Accumulated amortization (4,040,676 ) - (33,950 ) (4,074,626 ) Carrying Value at December 31, 2022 $ 435,595 $ - $ 130,664 $ 566,259 Acquired and Developed Intellectual Software Property Patents Total Cost $ 4,476,271 $ - $ 158,303 $ 4,634,574 Accumulated amortization (2,237,389 ) - (17,733 ) (2,255,122 ) Carrying Value at December 31, 2021 $ 2,238,882 $ - $ 140,570 $ 2,379,452 |
Schedule of future expected amortization of intangible assets | 2023 $ 253,080 2024 168,094 2025 63,791 2026 16,456 2027 16,456 Thereafter 48,382 $ 566,259 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | 2022 2021 Trade payables $ 623,130 $ 548,087 Accrued interest - 33,553 Accrued payroll and related expenses 145,837 783,144 Other 385,105 413,309 $ 1,154,072 $ 1,778,093 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Convertible Notes Payable [Abstract] | |
Schedule of the convertible notes payable outstanding | December 31, December 31, 2022 2021 10% convertible note due December 31, 2022 $ - $ 662,000 9.75% convertible notes due March 31, 2025 9,125,205 - less Unamortized debt discount expense (203,593 ) - Unamortized debt issuance expense (1,080,112 ) - $ 7,841,500 $ 662,000 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of warrant activity | Weighted Weighted Average Average Number of Exercise Remaining Shares Price Life Outstanding, January 1, 2021 1,823,267 $ 4.20 3.4 Years Granted 64,286 $ 8.75 5.0 Years Exercised/Cancelled (483,943 ) $ 3.22 - Outstanding, December 31, 2021 1,403,610 $ 4.61 3.0 Years Granted 142,690 $ 3.70 5.0 Years Exercised/Cancelled (317,074 ) $ 4.15 0.1 Years Outstanding, December 31, 2022 1,229,226 $ 4.62 2.96 Years |
Schedule of grant date fair value of options granted | 2022 2021 Expected volatility 123-127 % 70 % Expected term 5 Years 1.0-5.0 Years Risk free rate 2.14-3.75 % 0.16-1.27& Dividend rate 0.00 % 0.00 % |
Schedule of related to stock options | Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (Yrs.) Value Outstanding, January 1, 2021 5,645,802 $ 4.50 7.5 $ 8,283,639 Granted 4,583,609 $ 7.56 10.0 $ - Exercised (599,661 ) $ 1.29 5.0 $ 3,485,482 Forfeited/cancelled (718,756 ) $ 6.52 8.8 $ - Outstanding, December 31, 2021 8,910,994 $ 6.48 6.7 $ 67,488,214 Granted 1,985,337 $ 1.61 10.0 $ - Exercised (397,698 ) $ 2.32 8.8 $ - Forfeited/cancelled (166,113 ) $ 6.62 7.9 $ - Outstanding, December 31, 2022 10,332,520 $ 5.81 6.5 $ - Exercisable, December 31, 2022 5,577,259 $ 5.86 4.5 $ - |
Schedule of stock option | Contractual Exercise Price Outstanding Life (Yrs.) Exercisable $.03 - $4.00 5,103,482 5.9 3,193,783 $4.01 - $7.00 151,667 3.6 151,667 $7.01 - $10.00 3,416,135 8.3 911,966 $10.01 - $15.97 1,661,236 4.9 1,319,843 10,332,520 6.5 5,577,259 |
Income tax (Tables)
Income tax (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of loss before income taxes from US and Foreign sources | 2022 2021 United States (25,424,002 ) (16,466,423 ) Outside United States 1,208,777 (1,198,341 ) Loss before income taxes (24,215,225 ) (17,664,764 ) |
Schedule of U.S. federal statutory tax rate and the company’s effective tax rate | 2022 2021 US Federal statutory federal income tax 21.00 % 21.00 % State taxes -2.52 % 3.94 % Other deferred adjustments 3.03 % -2.02 % Change in tax rates 0 % -1.53 % Change in valuation allowance -21.5 % -21.39 % Total income tax provision 0 % 0 % |
Schedule of deferred tax assets and liabilities | 2022 2021 Deferred tax assets Net operating loss 14,997,873 12,702,731 Stock options 7,450,914 5,922,550 Federal tax credits 336,475 303,556 Basis difference in intangible and fixed assets 963,784 (206,925 ) Accrued payroll 11,203 169,242 Capital loss 350,526 - Valuation allowance (24,110,775 ) (18,891,154 ) Deferred tax assets, net - - |
Discontinued Operations and A_2
Discontinued Operations and Assets Held for Sale (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations and Assets Held for Sale [Abstract] | |
Schedule of assets and liabilities of card plus sale and consideration received | Carrying value of net assets sold: Amount Cash $ 299,505 Accounts receivable 61,879 Inventory 231,955 Other current assets 1,490 Total current assets 594,829 Property and equipment 21,127 Total assets 615,956 Accounts payable 76,094 Accrued expenses 43,728 Deferred revenue 11,159 Total current liabilities 130,981 Net assets sold $ 484,975 Sale Consideration on disposition of net assets: Proceeds $ 300,000 Legal fee (5,511 ) Write off net payable with CP 2,239 Net Consideration 296,728 Net loss on sale of a discontinued operation $ (188,247 ) |
Schedule of operations of cards plus and multipay | For the Year Ended Discontinued Operations 2022 2021 Discontinued Operations Total Revenues, net $ 1,503,333 $ 1,678,780 Operating Expenses: Cost of sales 665,269 653,773 General and administrative 1,021,649 1,892,783 Impairment loss 143,698 - Depreciation and amortization 41,850 102,513 Total operating expenses 1,872,466 2,649,069 Loss from operations (369,133 ) (970,289 ) Other Income (Expense): Other income 10,161 27,188 Interest expense, net (364 ) (5,164 ) Other income, net 9,797 22,024 Loss before income taxes (359,336 ) (948,265 ) Income tax expense (7,327 ) (6,030 ) Loss from discontinued operations (366,663 ) (954,295 ) Loss from sale of discontinued operations (188,247 ) - Total loss from discontinued operations $ (554,910 ) $ (954,295 ) For the Year Ended 2022 2021 Cards Plus Total Revenues, net $ 1,263,672 $ 1,318,029 Operating Expenses: Cost of sales 665,269 653,773 General and administrative 412,243 606,110 Impairment loss 143,698 - Depreciation and amortization 24,451 80,692 Total operating expenses 1,245,661 1,340,575 Income (Loss) from operations 18,011 (22,546 ) Other Income (Expense): Other income (expense), net 8,919 6,867 Interest expense, net (364 ) (5,164 ) Other income, net 8,555 1,703 Income (Loss) before income taxes 26,566 (20,843 ) Income tax expense (4,681 ) - Income (Loss) from discontinued operations 21,885 (20,843 ) Loss from sale of discontinued operations (188,247 ) - Total income (loss) from discontinued operations $ (166,362 ) $ (20,843 ) For the Year Ended 2022 2021 MultiPay Total Revenues, net $ 239,661 $ 360,751 Operating Expenses: General and administrative 609,406 1,286,673 Depreciation and amortization 17,399 21,821 Total operating expenses 626,805 1,308,494 Loss from operations (387,144 ) (947,743 ) Other Income: Other income, net 1,242 20,321 Other income 1,242 20,321 Loss before income taxes (385,902 ) (927,422 ) Income tax expense (2,646 ) (6,030 ) Loss from discontinued operations $ (388,548 ) $ (933,452 ) |
Schedule of operations assets and liabilities have been reclassified | December 31, December 31 Discontinued Operations Current Assets: Cash $ 2,703 $ 270,707 Accounts receivable, net 105,194 110,977 Inventory - 153,149 Other current assets 10,562 94,919 Current assets held for sale 118,459 629,752 Noncurrent Assets: Property and equipment, net 27,595 93,132 Intangible assets - 153,004 Other assets - 66,695 Noncurrent assets held for sale 27,595 312,831 Total assets held for sale $ 146,054 $ 942,583 Current Liabilities: Accounts payable and accrued expenses $ 13,759 $ 235,348 Deferred revenue - 47,823 Notes payable obligation, current portion - 1,579 Capital lease obligation, current portion - 10,562 Total liabilities held for sale $ 13,759 $ 295,312 December 31, December 31 Cards Plus Current Assets: Cash $ - $ 182,518 Accounts receivable, net - 88,235 Inventory - 153,149 Other current assets - 52,678 Current assets held for sale - 476,580 Noncurrent Assets: Property and equipment, net - 24,619 Intangible assets - 153,004 Noncurrent assets held for sale - 177,623 Total assets held for sale $ - $ 654,203 Current Liabilities: Accounts payable and accrued expenses $ - $ 122,725 Deferred revenue - 47,823 Notes payable obligation, current portion - 1,579 Capital lease obligation, current portion - 1,056 Total liabilities held for sale $ - $ 173,183 December 31, December 31 MultiPay Current Assets: Cash $ 2,703 $ 88,189 Accounts receivable, net 105,194 22,742 Other current assets 10,562 42,241 Current assets held for sale 118,459 153,172 Noncurrent Assets: Property and equipment, net 27,595 68,513 Other assets - 66,695 Noncurrent assets held for sale 27,595 135,208 Total assets held for sale $ 146,054 $ 288,380 Current Liabilities: Accounts payable and accrued expenses $ 13,759 $ 112,623 Total liabilities held for sale $ 13,759 $ 112,623 |
Schedule of cash flow activity related to discontinued operations | Year Ended December 31, 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (366,663 ) $ (954,295 ) Adjustments to reconcile net loss with cash flows from operations: Depreciation and amortization expense 41,850 102,513 Impairment of intangible assets 143,698 - Provision of Net Investment in direct financing lease - 422,022 Changes in operating assets and liabilities: Accounts receivable (50,598 ) 18,722 Net investment in direct financing lease - 96,487 Other current assets 170,536 88,345 Inventory (78,806 ) 96,930 Accounts payable and accrued expenses (102,486 ) (115,870 ) Deferred revenue (36,664 ) (82,594 ) Adjustments relating to discontinued operations 87,530 626,555 Net cash flows from discontinued operations $ (279,133 ) $ (327,740 ) |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of lease related balances | 2022 2021 Current portion of operating lease ROU assets - included in current assets held for sale $ - $ 76,454 Total operating lease assets $ - $ 76,454 Liabilities Current portion of ROU liabilities - included in current liabilities held for sale $ - $ 69,812 Total operating lease liabilities $ - $ 69,812 |
Description of Business and S_3
Description of Business and Summary of Significant Accounting Policies (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Feb. 14, 2023 | Mar. 21, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Mar. 09, 2023 | Dec. 03, 2022 | |
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Accumulated deficit | $ 140,000,000 | |||||
Revenue | 527,000,000,000 | |||||
Earned revenue from continuing operations | 12,800,000 | |||||
Loss from continuing operations | 24,200,000 | |||||
Additional financing | 3,600,000 | |||||
Credit facility | $ 10,000,000 | |||||
Principal amount | $ 9,200,000 | $ 50,000 | $ 900,000 | $ 696,000 | ||
Interest rate | 9.75% | 12% | ||||
Per annum rate | 12% | 15% | ||||
Contract liability | $ 81,000 | $ 199,000 | ||||
Federal deposit insurance corporation | 250,000 | |||||
Excess of the insured amounts by the FDIC | 2,900,000 | |||||
Intangible assets | 600,000 | 2,400,000 | ||||
Impairment expense | 1,100,000 | 800,000 | ||||
Digital marketing expenses | $ 220,000 | $ 65,000 | ||||
Common stock [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Commitment fee (in Shares) | 100,000 | |||||
Minimum [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Labor reduction plan | $ 0.5 | |||||
Maximum [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Labor reduction plan | $ 1,100,000 | |||||
Revenues and Accounts Receivable 2022 [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Percentage of concentration risk | 70% | |||||
Revenues and Accounts Receivable 2022 [Member] | Accounts Receivable [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Percentage of concentration risk | 86% | |||||
British Banks [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Cash held by acquire | $ 1,000 | |||||
United states [Member] | Revenues and Accounts Receivable2021 [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Percentage of concentration risk | 85% | |||||
U S Customer [Member] | Revenues and Accounts Receivable2021 [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Percentage of concentration risk | 85% | |||||
U S Customer [Member] | Revenues and Accounts Receivable2021 [Member] | Accounts Receivable [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Percentage of concentration risk | 86% | |||||
A&R Facility Agreement [Member] | ||||||
Description of Business and Summary of Significant Accounting Policies (Details) [Line Items] | ||||||
Subsequent Funding | $ 2,700,000 |
Description of Business and S_4
Description of Business and Summary of Significant Accounting Policies (Details) - Schedule of calculation of diluted loss per share - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares | 14,028,043 | 10,432,133 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares | 1,229,226 | 1,403,610 |
Stock options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares | 10,332,520 | 8,910,994 |
Convertible notes payable [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares | 2,466,297 | 117,529 |
Other Current Assets and Othe_3
Other Current Assets and Other Assets (Details) - Schedule of other current assets - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Other Current Assets [Abstract] | ||
Prepaid Insurance | $ 244,215 | $ 223,318 |
Unamortized working capital facility fees - current | 199,156 | |
Prepaid Third Party Services | 135,405 | 276,085 |
Other | 150,566 | 3,318 |
Total other current assets | $ 729,342 | $ 502,721 |
Other Current Assets and Othe_4
Other Current Assets and Other Assets (Details) - Schedule of other assets - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Other Assets [Abstract] | ||
Unamortized working capital facility fees - non current | $ 248,945 | |
Other | 1,438 | 2,501 |
Other assets | $ 250,383 | $ 2,501 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 25,021 | $ 4,038 |
Property and Equipment, Net (_2
Property and Equipment, Net (Details) - Schedule of property and equipment - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 139,599 | $ 142,443 |
Less: Accumulated Depreciation | (139,599) | (117,044) |
Property and Equipment, Net | 25,399 | |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Property and equipment | $ 85,583 | 77,602 |
Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 5 years | |
Property and equipment | $ 54,016 | $ 64,841 |
Intangible Assets, Net (Other_3
Intangible Assets, Net (Other than Goodwill) (Details) - Schedule of intangible assets, net - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Carrying Value, Beginning | $ 2,379,452 | $ 3,716,173 | |
Additions | 6,311 | $ 26,705 | |
Impairment of assets | (1,107,867) | (335,101) | |
Amortization | (711,637) | (1,028,325) | |
Carrying Value, Ending | 566,259 | 2,379,452 | |
Cost | 4,640,885 | 4,634,574 | |
Accumulated amortization | (4,074,626) | (2,255,122) | |
Acquired and Developed Software [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful Lives | 5 years | ||
Carrying Value, Beginning | 2,238,882 | $ 3,171,394 | |
Additions | |||
Impairment of assets | (1,107,867) | ||
Amortization | (695,420) | (932,512) | |
Carrying Value, Ending | 435,595 | 2,238,882 | |
Cost | 4,476,271 | 4,476,271 | |
Accumulated amortization | (4,040,676) | (2,237,389) | |
Intellectual Property [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful Lives | 10 years | ||
Carrying Value, Beginning | $ 416,471 | ||
Additions | |||
Impairment of assets | (335,101) | ||
Amortization | (81,370) | ||
Carrying Value, Ending | |||
Cost | |||
Accumulated amortization | |||
Patents [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful Lives | 10 years | ||
Carrying Value, Beginning | 140,570 | $ 128,308 | |
Additions | 6,311 | 26,705 | |
Impairment of assets | |||
Amortization | (16,217) | (14,443) | |
Carrying Value, Ending | 130,664 | 140,570 | |
Cost | 164,614 | 158,303 | |
Accumulated amortization | $ (33,950) | $ (17,733) |
Intangible Assets, Net (Other_4
Intangible Assets, Net (Other than Goodwill) (Details) - Schedule of future expected amortization of intangible assets | Dec. 31, 2022 USD ($) |
Schedule of Future Expected Amortization of Intangible Assets [Abstract] | |
2023 | $ 253,080 |
2024 | 168,094 |
2025 | 63,791 |
2026 | 16,456 |
2027 | 16,456 |
Thereafter | 48,382 |
Total | $ 566,259 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - Schedule of accounts payable and accrued expenses - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Accounts Payable and Accrued Expenses [Abstract] | ||
Trade payables | $ 623,130 | $ 548,087 |
Accrued interest | 33,553 | |
Accrued payroll and related expenses | 145,837 | 783,144 |
Other | 385,105 | 413,309 |
Total | $ 1,154,072 | $ 1,778,093 |
Working Capital Facility (Detai
Working Capital Facility (Details) - USD ($) | 1 Months Ended | 12 Months Ended |
Mar. 21, 2022 | Dec. 31, 2022 | |
Working Capital Faciltiy [Abstract] | ||
Unsecured line of credit facility | $ 10,000,000 | |
Shares of our common stock (in Shares) | 100,000 | |
Unamortized deferred debt expense | $ 448,000 | |
Other current assets | 199,000 | |
Credit facility of maximum amount | 3,600,000 | |
Drawdown cash | $ 900,000 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Mar. 21, 2022 | Dec. 31, 2022 | Mar. 09, 2023 | Dec. 03, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Aug. 26, 2021 | |
Convertible Notes Payable (Details) [Line Items] | |||||||
Aggregate initial principal amount | $ 9,200,000 | $ 50,000 | $ 900,000 | $ 696,000 | |||
Conversion price per share (in Dollars per share) | $ 3.7 | ||||||
Aggregate cash origination fee | $ 200,000 | ||||||
Shares of our common stock (in Shares) | 28,500 | 214,285 | |||||
Convertible notes interest rate | 9.75% | 12% | |||||
Convertible notes maturity date | Mar. 31, 2025 | ||||||
Accrued interest | $ 406 | ||||||
Shares of common stock (in Shares) | 13,514 | 479,845 | |||||
Common stock warrants (in Shares) | 142,690 | ||||||
Fair value | $ 449,000 | ||||||
Outstanding amount | $ 662,000 | ||||||
Interest rate | 10% | ||||||
Maturity date, description | The maturity date of the Stern Note was previously February 29, 2022 and the Stern Trust and the Company mutually agreed to extend the due date to December 31, 2022. | ||||||
Common Stock [Member] | |||||||
Convertible Notes Payable (Details) [Line Items] | |||||||
Shares of common stock (in Shares) | 135 | 479,845 | 34,996 | 756,000,000,000 |
Convertible Notes Payable (De_2
Convertible Notes Payable (Details) - Schedule of the convertible notes payable outstanding - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
less | ||
Unamortized debt discount expense | $ (203,593) | |
Unamortized debt issuance expense | (1,080,112) | |
Total | 7,841,500 | $ 662,000 |
10.0% convertible note due December 31, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | $ 662,000 | |
9.75% convertible notes due March 31, 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | $ 9,125,205 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||
Mar. 06, 2023 | Apr. 25, 2022 | Mar. 21, 2022 | Jun. 14, 2021 | Sep. 30, 2022 | Aug. 26, 2022 | Apr. 30, 2022 | Nov. 30, 2021 | Jun. 30, 2021 | May 31, 2021 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 26, 2023 | Jun. 17, 2022 | Aug. 26, 2021 | Jun. 09, 2021 | |
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Shares issued of convertible notes (in Shares) | 353,216 | ||||||||||||||||
Unsecured amount | $ 10,000,000 | ||||||||||||||||
Shares of common stock (in Shares) | 100,000 | ||||||||||||||||
Company assets | $ 9,374,185 | $ 13,830,010 | |||||||||||||||
Annual salary receive | $ 275,000 | $ 275,000 | |||||||||||||||
Provide bonus percentage | 40% | ||||||||||||||||
Bonus amount | $ 25,000 | ||||||||||||||||
Exercise price per share (in Dollars per share) | $ 3.03 | $ 3.03 | |||||||||||||||
Shares of common stock (in Shares) | 1,171,000 | ||||||||||||||||
Invested in consideration | $ 90,000 | 3,146,940 | $ 10,282,998 | ||||||||||||||
Additional shares (in Shares) | 81,000 | 7 | |||||||||||||||
Gross proceeds | 3,146,940 | $ 10,282,998 | |||||||||||||||
Offering and purchased, costs | $ 1,300,000 | ||||||||||||||||
Convertible notes payable | $ 1,642,856 | ||||||||||||||||
Receive from bonus | $ 50,000 | ||||||||||||||||
Stock option vested (in Shares) | 13,992 | ||||||||||||||||
Granted options to acquire shares of common stock | $ 29,173 | ||||||||||||||||
Stock options forfeited | 41,667 | ||||||||||||||||
Additional option to acquire | $ 10,238 | ||||||||||||||||
Common Stock [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Shares of common stock (in Shares) | 1,063,514 | 1,642,856 | |||||||||||||||
Share issued (in Shares) | 1,642,856 | ||||||||||||||||
Invested in consideration | $ 106 | $ 164 | |||||||||||||||
Per share, price (in Dollars per share) | $ 7 | ||||||||||||||||
Additional shares (in Shares) | 214,285 | ||||||||||||||||
Gross proceeds | $ 11,500,000 | ||||||||||||||||
Subsequent Event [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Amended amount | $ 3,600,000 | ||||||||||||||||
Company assets | $ 900,000 | ||||||||||||||||
Board of Directors Chairman [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Stock option of vesting | $ 122,222 | ||||||||||||||||
Mr Thimot [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Exercise price per share (in Dollars per share) | $ 7.8 | ||||||||||||||||
Mr Smith [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 600,000 | ||||||||||||||||
Exercise price per share (in Dollars per share) | $ 7.8 | ||||||||||||||||
Warrant term | 10 years | ||||||||||||||||
Principal amount | $ 275,000 | ||||||||||||||||
Bearing interest rate | 50% | ||||||||||||||||
Executive Retention Agreement [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Received amount | $ 305,000 | ||||||||||||||||
Mr Szoke [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 62,500 | ||||||||||||||||
Exercise price per share (in Dollars per share) | $ 7.8 | ||||||||||||||||
Invested in consideration | $ 250,000 | ||||||||||||||||
Warrant term | 10 years | ||||||||||||||||
Two Directors [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Cash invested | 1,200,000 | ||||||||||||||||
Common stock offering | $ 200,000 | ||||||||||||||||
Ms. Pham [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 350,000 | 60,000 | |||||||||||||||
Exercise price per share (in Dollars per share) | $ 2.41 | $ 0.79 | |||||||||||||||
Mr. Trelin [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Exercise price per share (in Dollars per share) | $ 3.13 | ||||||||||||||||
Shares of common stock (in Shares) | 100,897 | ||||||||||||||||
Invested in consideration | $ 270,000 | ||||||||||||||||
Warrant term | 10 years | ||||||||||||||||
Board of Directors [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 34,996 | ||||||||||||||||
Granted, description | The Company also granted Mr. Selzer and Mr. Stern 22,388 stock options to acquire common shares for service in 2021 prior to their resignation as Directors. | ||||||||||||||||
Stern Trust [Member] | Theodore Stern [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Convertible notes payable | $ 662,000 | ||||||||||||||||
Herbert Selzer [Member] | Theodore Stern [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 41,000 | ||||||||||||||||
Convertible notes payable | $ 256,000 | ||||||||||||||||
Mr Kumnick [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Cancellation shares (in Shares) | 300,000 | ||||||||||||||||
Mr Kumnick [Member] | Mr Broenniman [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 1,166,667 | ||||||||||||||||
Exercise price per share (in Dollars per share) | $ 7.2 | ||||||||||||||||
Warrant term | 10 years | ||||||||||||||||
Mr Broenniman [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Cancellation shares (in Shares) | 200,000 | ||||||||||||||||
Mr Thimot [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 1,200,000 | ||||||||||||||||
Principal amount | $ 325,000 | ||||||||||||||||
Bearing interest rate | 50% | ||||||||||||||||
Board of Directors Chairman [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Share issued (in Shares) | 93,470 | ||||||||||||||||
Progress Partners Inc. [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Agreed to pay for business activity | 350,000 | ||||||||||||||||
Additional consulting services | $ 115,000 | ||||||||||||||||
Convertible Notes Payable Issued [Member] | |||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||
Shares issued of convertible notes (in Shares) | 20,761 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Dec. 03, 2022 | Jun. 14, 2021 | Apr. 30, 2022 | Mar. 21, 2022 | Mar. 18, 2022 | Aug. 26, 2021 | Jun. 30, 2021 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 26, 2022 | |
Stockholders' Equity (Details) [Line Items] | |||||||||||
Common stock shares authorized | 250,000,000 | 1,000,000,000 | |||||||||
Common stock of shares issued | 1,063,514 | 1,063,514 | 25,319,095 | 23,294,024 | |||||||
Common stock shares | 25,319,095 | 23,294,024 | |||||||||
Preferred stock, authorized | 20,000,000 | ||||||||||
Common stock price per share (in Dollars per share) | $ 3.7 | $ 3.03 | |||||||||
Gross proceeds (in Dollars) | $ 3,300,000 | $ 3,300,000 | |||||||||
Credit facility amount (in Dollars) | $ 10,000,000 | ||||||||||
Amount (in Dollars) | $ 50,000 | ||||||||||
Accrued interest (in Dollars) | $ 406 | ||||||||||
Number of shares | 479,845 | 13,514 | |||||||||
Interest (in Dollars) | $ 696,000 | $ 1,359,954 | $ 586,850 | ||||||||
Conversion of common shares issued | 353,216 | ||||||||||
Convertible notes totaling (in Dollars) | $ 1,642,856 | ||||||||||
Converted common stock shares | 7 | 81,000 | |||||||||
Exercise shares | 28,500 | 214,285 | |||||||||
Gross proceeds (in Dollars) | $ 11,500,000 | ||||||||||
Convertible Notes Payable, Current (in Dollars) | $ 6.2 | ||||||||||
Shares of common stock | 1,171,000 | ||||||||||
Common Stock Warrants (in Dollars) | $ 142,690 | ||||||||||
Exercise price (in Dollars) | $ 3.7 | ||||||||||
Aggregate common share | 64,286 | ||||||||||
Shares issued (in Dollars) | $ 4.5 | ||||||||||
Per share price (in Dollars per share) | $ 8.75 | ||||||||||
Offering price | 125% | ||||||||||
Exercise price per share (in Dollars per share) | $ 3.03 | ||||||||||
Common stock value (in Dollars) | $ 90,000 | $ 3,146,940 | $ 10,282,998 | ||||||||
Number of shares | 93,470 | ||||||||||
Stock option to board of directors, Description | The Company granted each of the four new Directors appointed June 2021 (“June Directors”) stock options to acquire 62,500 shares of common stock or a total of 250,000 that vest one third a year after each Annual Meeting. Additionally, the Company added another Director in November 2021 and granted stock options to acquire 29,173 shares of common stock that vest one third a year after each Annual Meeting beginning in 2022. One of the June Directors did not stand for reelection to the Board of Directors in December 2021 and forfeited 41,667 stock options. In December 2021, the Company granted additional options to acquire 10,238 shares of common stock to each of the non-employee Directors, by way of annual compensation under the Company’s compensation policy for non-employee directors and which vests monthly over a one-year-period. | ||||||||||
Options description | The options for the majority vest annually over a three-year period, 100,000 vest equally over a four-year period, and the balance of 100,000 vest upon the achievement of certain market capitalization thresholds or performance conditions. | ||||||||||
Unrecognized compensation costs (in Dollars) | $ 10,000,000 | ||||||||||
Stock compensation expense (in Dollars) | $ 5,500,000 | ||||||||||
Restricted stock expense (in Dollars) | $ 1,228,000 | ||||||||||
Common Stock [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 479,845 | 34,996 | 135 | 756,000,000,000 | |||||||
Converted common stock shares | 214,285 | ||||||||||
Common stock value (in Dollars) | $ 106 | $ 164 | |||||||||
Exercise feature issued common shares (in Dollars) | $ 31 | $ 42 | |||||||||
Options [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 175,000 | ||||||||||
Performance-based [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 175,000 | ||||||||||
Maximum [Member] | Common Stock [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 13,514 | ||||||||||
Minimum [Member] | Common Stock [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 135 | ||||||||||
Common Stock [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Common stock shares authorized | 250,000,000 | ||||||||||
Common stock of shares issued | 25,319,095 | ||||||||||
Common stock shares | 23,294,024 | ||||||||||
Common stock of fair market value (in Dollars per share) | $ 3.03 | ||||||||||
Employee Stock Option [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Stock compensation expense (in Dollars) | $ 8,900,000 | ||||||||||
Employees [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 1,674,464 | ||||||||||
Mr Thimot [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Exercise price per share (in Dollars per share) | $ 7.8 | ||||||||||
Exercise feature issued common shares (in Dollars) | $ 1,200,000 | ||||||||||
Mr Smith [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Exercise price per share (in Dollars per share) | $ 7.8 | ||||||||||
Warrant term | 10 years | ||||||||||
Number of shares | 600,000 | ||||||||||
Mr Broenniman [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 583,333 | ||||||||||
Stock options to acquire the cancel shares | 200,000 | ||||||||||
Mr Kumnick [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Stock options to acquire the cancel shares | 300,000 | ||||||||||
Mr Selzer [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 22,388 | ||||||||||
Mr.Stern [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Number of shares | 6,997 | ||||||||||
Mr. Trelin [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Shares of common stock | 100,897 | ||||||||||
Exercise price (in Dollars) | $ 270,000 | ||||||||||
Exercise price per share (in Dollars per share) | $ 3.13 | ||||||||||
Warrant term | 10 years | ||||||||||
Common stock value (in Dollars) | $ 270,000 | ||||||||||
Note Investors [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Common stock of shares issued | 28,496 | ||||||||||
Credit Facility [Member] | |||||||||||
Stockholders' Equity (Details) [Line Items] | |||||||||||
Common stock of shares issued | 100,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - Schedule of warrant activity - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of warrant activity [Abstract] | ||
Number of Shares, Outstanding, balance at beginning | 1,403,610 | 1,823,267 |
Weighted Average Exercise Price, balance at beginning | $ 4.61 | $ 4.2 |
Weighted Average Remaining Life, balance at beginning | 3 years 4 months 24 days | |
Number of Shares, Granted | 142,690 | 64,286 |
Weighted Average Exercise Price, Granted | $ 3.7 | $ 8.75 |
Weighted Average Remaining Life, Granted | 5 years | 5 years |
Number of Shares, Exercised/cancelled | (317,074) | (483,943) |
Weighted Average Exercise Price, Exercised/cancelled | $ 4.15 | $ 3.22 |
Weighted Average Remaining Life, Exercised/cancelled | 1 month 6 days | |
Number of Shares, Outstanding, balance at ending | 1,229,226 | 1,403,610 |
Weighted Average Exercise Price, Outstanding, balance at ending | $ 4.62 | $ 4.61 |
Weighted Average Remaining Life, Outstanding, balance at ending | 2 years 11 months 15 days | 3 years |
Stockholders' Equity (Details_2
Stockholders' Equity (Details) - Schedule of grant date fair value of options granted | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stockholders' Equity (Details) - Schedule of grant date fair value of options granted [Line Items] | ||
Expected volatility | 70% | |
Expected term | 5 years | |
Dividend rate | 0% | 0% |
Minimum [Member] | ||
Stockholders' Equity (Details) - Schedule of grant date fair value of options granted [Line Items] | ||
Expected volatility | 123% | |
Expected term | 1 year | |
Risk free rate | 2.14% | 0.16% |
Maximum [Member] | ||
Stockholders' Equity (Details) - Schedule of grant date fair value of options granted [Line Items] | ||
Expected volatility | 127% | |
Expected term | 5 years | |
Risk free rate | 3.75% | 1.27% |
Stockholders' Equity (Details_3
Stockholders' Equity (Details) - Schedule of related to stock options - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of related to stock options [Abstract] | ||
Number of Shares, Outstanding at beginning | 8,910,994 | 5,645,802 |
Weighted Average Exercise Price, Outstanding at beginning | $ 6.48 | $ 4.5 |
Weighted Average Contractual Term (Yrs.), Outstanding at beginning | 7 years 6 months | |
Aggregate Intrinsic Value, Outstanding at beginning | $ 67,488,214 | $ 8,283,639 |
Number of Shares, Granted | 1,985,337 | 4,583,609 |
Weighted Average Exercise Price, Granted | $ 1.61 | $ 7.56 |
Weighted Average Contractual Term (Yrs.), Granted | 10 years | 10 years |
Aggregate Intrinsic Value, Granted | ||
Number of Shares Exercised | (397,698) | (599,661) |
Weighted Average Exercise Price Exercised | $ 2.32 | $ 1.29 |
Weighted Average Contractual Term (Yrs.) Exercised | 8 years 9 months 18 days | 5 years |
Aggregate Intrinsic Value, Exercised | $ 3,485,482 | |
Number of Shares Forfeited/cancelled | (166,113) | (718,756) |
Weighted Average Exercise Price Forfeited/cancelled | $ 6.62 | $ 6.52 |
Weighted Average Contractual Term (Yrs.) Forfeited/cancelled | 7 years 10 months 24 days | 8 years 9 months 18 days |
Aggregate Intrinsic Value Forfeited/cancelled | ||
Number of Shares, Outstanding at ending | 10,332,520 | 8,910,994 |
Weighted Average Exercise Price, Outstanding at ending | $ 5.81 | $ 6.48 |
Weighted Average Contractual Term (Yrs.), Outstanding at ending | 6 years 6 months | 6 years 8 months 12 days |
Aggregate Intrinsic Value, Outstanding at ending | $ 67,488,214 | |
Number of Shares, Exercisable at ending | 5,577,259 | |
Weighted Average Exercise Price, Exercisable at ending | $ 5.86 | |
Weighted Average Contractual Term (Yrs.), Exercisable at ending | 4 years 6 months |
Stockholders' Equity (Details_4
Stockholders' Equity (Details) - Schedule of stock option | 12 Months Ended |
Dec. 31, 2022 shares | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Outstanding | 10,332,520 |
Contractual Life (Yrs.) | 6 years 6 months |
Exercisable | 5,577,259 |
Exercise Price $.03 - $4.00 [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Outstanding | 5,103,482 |
Contractual Life (Yrs.) | 5 years 10 months 24 days |
Exercisable | 3,193,783 |
Exercise Price $4.01 - $7.00 [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Outstanding | 151,667 |
Contractual Life (Yrs.) | 3 years 7 months 6 days |
Exercisable | 151,667 |
Exercise Price $7.01 - $10.00 [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Outstanding | 3,416,135 |
Contractual Life (Yrs.) | 8 years 3 months 18 days |
Exercisable | 911,966 |
Exercise Price $10.01 - $15.97 [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Outstanding | 1,661,236 |
Contractual Life (Yrs.) | 4 years 10 months 24 days |
Exercisable | 1,319,843 |
Income tax (Details)
Income tax (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Income Tax Disclosure [Abstract] | ||
Federal net operating loss carry forward | $ 63.5 | |
State net operating loss carry forwards | 31.9 | |
Operating loss carry forwards | 14.4 | |
Indefinite life | 49.1 | |
Valuation allowance | $ 23.8 | $ 18.9 |
Income tax (Details) - Schedule
Income tax (Details) - Schedule of loss before income taxes from US and Foreign sources - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income tax (Details) - Schedule of loss before income taxes from US and Foreign sources [Line Items] | ||
Loss before income taxes | $ (24,215,225) | $ (17,664,764) |
Domestic Tax Authority [Member] | ||
Income tax (Details) - Schedule of loss before income taxes from US and Foreign sources [Line Items] | ||
Loss before income taxes | (25,424,002) | (16,466,423) |
Foreign Tax Authority [Member] | ||
Income tax (Details) - Schedule of loss before income taxes from US and Foreign sources [Line Items] | ||
Loss before income taxes | $ 1,208,777 | $ (1,198,341) |
Income tax (Details) - Schedu_2
Income tax (Details) - Schedule of U.S. federal statutory tax rate and the company’s effective tax rate | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Schedule of US Federal Statutory Tax Rate and the Company’s Effective Tax Rate [Abstract] | ||
US Federal statutory federal income tax | 21% | 21% |
State taxes | (2.52%) | 3.94% |
Other deferred adjustments | 3.03% | (2.02%) |
Change in tax rates | 0% | (1.53%) |
Change in valuation allowance | (21.50%) | (21.39%) |
Total income tax provision | 0% | 0% |
Income tax (Details) - Schedu_3
Income tax (Details) - Schedule of deferred tax assets and liabilities - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets | ||
Net operating loss | $ 14,997,873 | $ 12,702,731 |
Stock options | 7,450,914 | 5,922,550 |
Federal tax credits | 336,475 | 303,556 |
Basis difference in intangible and fixed assets | 963,784 | (206,925) |
Accrued payroll | 11,203 | 169,242 |
Capital loss | 350,526 | |
Valuation allowance | (24,110,775) | (18,891,154) |
Deferred tax assets, net |
Discontinued Operations and A_3
Discontinued Operations and Assets Held for Sale (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Aug. 29, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 30, 2021 | |
Discontinued Operations and Assets Held for Sale [Abstract] | ||||
Description on sale of card plus | On August 29, 2022, the Company completed the sale of Cards Plus for a price of $300,000 of which $150,000 was received and the remaining balance of $150,000 recorded in other current assets is expected to be received within one year, less $3,272 in costs to sell, and recognized a loss of $188,247 from the transaction. | |||
Description of employee and consultants payment | The Company incurred costs of $196,500 which was paid as of December 31, 2022 associated with the exit of the MultiPay business and approximately $41,000 for accelerated amortization (non-cash) for certain technology licenses. | |||
Reflect net realizable value | $ 20,000 | |||
Contract liability | $ 48,000 | |||
Impairment loss | $ 143,000 | |||
One-year lease amount | $ 2,900 | |||
Monthly rent | $ 8,000 |
Discontinued Operations and A_4
Discontinued Operations and Assets Held for Sale (Details) - Schedule of assets and liabilities of card plus sale and consideration received - Cards Plus [Member] | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |
Cash | $ 299,505 |
Accounts receivable | 61,879 |
Inventory | 231,955 |
Other current assets | 1,490 |
Total current assets | 594,829 |
Property and equipment | 21,127 |
Total assets | 615,956 |
Accounts payable | 76,094 |
Accrued expenses | 43,728 |
Deferred revenue | 11,159 |
Total current liabilities | 130,981 |
Net assets sold | 484,975 |
Sale Consideration on disposition of net assets: | |
Proceeds | 300,000 |
Legal fee | (5,511) |
Write off net payable with CP | 2,239 |
Net Consideration | 296,728 |
Net loss on sale of a discontinued operation | $ (188,247) |
Discontinued Operations and A_5
Discontinued Operations and Assets Held for Sale (Details) - Schedule of operations of cards plus and multipay - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Discontinued Operations [Member] | ||
Condensed Income Statements, Captions [Line Items] | ||
Discontinued Operations Total Revenues, net | $ 1,503,333 | $ 1,678,780 |
Operating Expenses: | ||
Cost of sales | 665,269 | 653,773 |
General and administrative | 1,021,649 | 1,892,783 |
Impairment loss | 143,698 | |
Depreciation and amortization | 41,850 | 102,513 |
Total operating expenses | 1,872,466 | 2,649,069 |
Income (loss) from operations | (369,133) | (970,289) |
Other Income (Expense): | ||
Other income | 10,161 | 27,188 |
Interest expense, net | (364) | (5,164) |
Other income, net | 9,797 | 22,024 |
Income (Loss) before income taxes | (359,336) | (948,265) |
Income tax expense | (7,327) | (6,030) |
Income (Loss) from discontinued operations | (366,663) | (954,295) |
Loss from sale of discontinued operations | (188,247) | |
Total loss from discontinued operations | (554,910) | (954,295) |
Cards Plus [Member] | ||
Operating Expenses: | ||
Cost of sales | 665,269 | 653,773 |
General and administrative | 412,243 | 606,110 |
Impairment loss | 143,698 | |
Depreciation and amortization | 24,451 | 80,692 |
Total operating expenses | 1,245,661 | 1,340,575 |
Income (loss) from operations | 18,011 | (22,546) |
Other Income (Expense): | ||
Other income (expense), net | 8,919 | 6,867 |
Interest expense, net | (364) | (5,164) |
Other income, net | 8,555 | 1,703 |
Income (Loss) before income taxes | 26,566 | (20,843) |
Income tax expense | (4,681) | |
Income (Loss) from discontinued operations | 21,885 | (20,843) |
Loss from sale of discontinued operations | (188,247) | |
Total income (loss) from discontinued operations | (166,362) | (20,843) |
Total Revenues, net | 1,263,672 | 1,318,029 |
MultiPay [Member] | ||
Operating Expenses: | ||
General and administrative | 609,406 | 1,286,673 |
Depreciation and amortization | 17,399 | 21,821 |
Total operating expenses | 626,805 | 1,308,494 |
Income (loss) from operations | (387,144) | (947,743) |
Other Income (Expense): | ||
Other income | 1,242 | 20,321 |
Other income (expense), net | 1,242 | 20,321 |
Income (Loss) before income taxes | (385,902) | (927,422) |
Income tax expense | (2,646) | (6,030) |
Income (Loss) from discontinued operations | (388,548) | (933,452) |
Total Revenues, net | $ 239,661 | $ 360,751 |
Discontinued Operations and A_6
Discontinued Operations and Assets Held for Sale (Details) - Schedule of operations assets and liabilities have been reclassified - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Discontinued Operations [Member] | ||
Discontinued Operations Current Assets: | ||
Cash | $ 2,703 | $ 270,707 |
Accounts receivable, net | 105,194 | 110,977 |
Inventory | 153,149 | |
Other current assets | 10,562 | 94,919 |
Current assets held for sale | 118,459 | 629,752 |
Noncurrent Assets: | ||
Property and equipment, net | 27,595 | 93,132 |
Intangible assets | 153,004 | |
Other assets | 66,695 | |
Noncurrent assets held for sale | 27,595 | 312,831 |
Total assets held for sale | 146,054 | 942,583 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 13,759 | 235,348 |
Deferred revenue | 47,823 | |
Notes payable obligation, current portion | 1,579 | |
Capital lease obligation, current portion | 10,562 | |
Total liabilities held for sale | 13,759 | 295,312 |
Cards Plus [Member] | ||
Discontinued Operations Current Assets: | ||
Cash | 182,518 | |
Accounts receivable, net | 88,235 | |
Inventory | 153,149 | |
Other current assets | 52,678 | |
Current assets held for sale | 476,580 | |
Noncurrent Assets: | ||
Property and equipment, net | 24,619 | |
Intangible assets | 153,004 | |
Noncurrent assets held for sale | 177,623 | |
Total assets held for sale | 654,203 | |
Current Liabilities: | ||
Accounts payable and accrued expenses | 122,725 | |
Deferred revenue | 47,823 | |
Notes payable obligation, current portion | 1,579 | |
Capital lease obligation, current portion | 1,056 | |
Total liabilities held for sale | 173,183 | |
MultiPay [Member] | ||
Discontinued Operations Current Assets: | ||
Cash | 2,703 | 88,189 |
Accounts receivable, net | 105,194 | 22,742 |
Other current assets | 10,562 | 42,241 |
Current assets held for sale | 118,459 | 153,172 |
Noncurrent Assets: | ||
Property and equipment, net | 27,595 | 68,513 |
Other assets | 66,695 | |
Noncurrent assets held for sale | 27,595 | 135,208 |
Total assets held for sale | 146,054 | 288,380 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 13,759 | 112,623 |
Total liabilities held for sale | $ 13,759 | $ 112,623 |
Discontinued Operations and A_7
Discontinued Operations and Assets Held for Sale (Details) - Schedule of cash flow activity related to discontinued operations - Discontinued Operations [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (366,663) | $ (954,295) |
Adjustments to reconcile net loss with cash flows from operations: | ||
Depreciation and amortization expense | 41,850 | 102,513 |
Impairment of intangible assets | 143,698 | |
Provision of Net Investment in direct financing lease | 422,022 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (50,598) | 18,722 |
Net investment in direct financing lease | 96,487 | |
Other current assets | 170,536 | 88,345 |
Inventory | (78,806) | 96,930 |
Accounts payable and accrued expenses | (102,486) | (115,870) |
Deferred revenue | (36,664) | (82,594) |
Adjustments relating to discontinued operations | 87,530 | 626,555 |
Net Cash flows from discontinued operations | $ (279,133) | $ (327,740) |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Employees contribution, description | the Company adopted the new 401 (k) plan where employer matches 100% of the employees contribution up to 3% of their salaries and 50% of the employee’s contribution (including both executives and other employees) between greater than 3% and less than 5% of their salaries. | ||
Monthly rental payments | $ 1,500 | $ 2,500 | $ 2,500 |
Rent expense included in general and administrative | 25,000 | 47,000 | |
Rent expense included in loss from discontinued operations | $ 90,000 | $ 140,000 |
Commitments and Contingencies_3
Commitments and Contingencies (Details) - Schedule of lease related balances - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Lease Related Balances [Abstract] | ||
Current portion of operating lease ROU assets - included in current assets held for sale | $ 76,454 | |
Total operating lease assets | 76,454 | |
Liabilities | ||
Current portion of ROU liabilities - included in current liabilities held for sale | 69,812 | |
Total operating lease liabilities | $ 69,812 |