Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 11, 2022 | |
Document Information Line Items | ||
Entity Registrant Name | 1847 HOLDINGS LLC | |
Trading Symbol | EFSH | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 4,079,137 | |
Amendment Flag | false | |
Entity Central Index Key | 0001599407 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-41368 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 38-3922937 | |
Entity Address, Address Line One | 590 Madison Avenue | |
Entity Address, Address Line Two | 21st Floor | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | (212) | |
Local Phone Number | 417-9800 | |
Title of 12(b) Security | Common Shares | |
Security Exchange Name | NYSEAMER | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash and cash equivalents | $ 1,584,499 | $ 1,383,533 |
Investments | 276,956 | 276,429 |
Receivables, net | 5,336,018 | 3,378,996 |
Contract assets | 128,462 | 88,466 |
Inventories, net | 4,756,603 | 5,427,302 |
Prepaid expenses and other current assets | 862,177 | 582,048 |
Total Current Assets | 12,944,715 | 11,136,774 |
Property and equipment, net | 2,049,496 | 1,695,311 |
Operating lease right-of-use assets | 3,037,676 | 3,192,604 |
Goodwill | 19,452,270 | 19,452,270 |
Intangible assets, net | 10,349,821 | 11,443,897 |
Other long-term assets | 82,566 | 85,691 |
TOTAL ASSETS | 47,916,544 | 47,006,547 |
Current Liabilities | ||
Accounts payable and accrued expenses | 5,438,895 | 4,818,672 |
Contract liabilities | 582,335 | 2,547,903 |
Customer deposits | 2,976,666 | 3,465,259 |
Due to related parties | 193,762 | 193,762 |
Current portion of operating lease liabilities | 707,419 | 613,696 |
Current portion of finance lease liabilities | 183,103 | 100,652 |
Current portion of notes payable, net | 660,332 | 692,522 |
Current portion of contingent note payable | 362,779 | |
Total Current Liabilities | 11,105,291 | 12,432,466 |
Operating lease liabilities, net of current portion | 2,419,449 | 2,607,862 |
Finance lease liabilities, net of current portion | 831,570 | 455,905 |
Notes payable, net of current portion | 175,921 | 251,401 |
Convertible notes payable, net of current portion | 24,465,177 | 26,630,655 |
Contingent note payable, net of current portion | 1,001,183 | |
Deferred tax liability, net | 573,000 | 2,070,000 |
TOTAL LIABILITIES | 39,570,408 | 45,449,472 |
Mezzanine Equity | ||
Series A senior convertible preferred shares | 1,655,404 | |
TOTAL MEZZANINE EQUITY | 1,655,404 | |
Shareholders’ Deficit | ||
Series A senior convertible preferred shares, no par value, 4,450,460 shares designated; 1,593,940 and 1,818,182 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 1,338,746 | |
Series B senior convertible preferred shares, no par value, 583,334 shares designated; 464,899 and zero shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 1,214,181 | |
Allocation shares, 1,000 shares authorized; 1,000 shares issued and outstanding as of September 30, 2022 and December 31, 2021 | 1,000 | 1,000 |
Common shares, $0.001 par value, 500,000,000 shares authorized; 4,079,137 and 1,210,918 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 4,079 | 1,211 |
Distribution receivable | (2,000,000) | (2,000,000) |
Additional paid-in capital | 43,962,606 | 21,723,042 |
Accumulated deficit | (36,648,788) | (20,754,394) |
TOTAL 1847 HOLDINGS SHAREHOLDERS’ EQUITY (DEFICIT) | 7,871,824 | (1,029,141) |
NON-CONTROLLING INTERESTS | 474,312 | 930,812 |
TOTAL SHAREHOLDERS’ EQUITY (DEFICIT) | 8,346,136 | (98,329) |
TOTAL LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS’ EQUITY (DEFICIT) | $ 47,916,544 | $ 47,006,547 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Allocation shares, issued | 1,000 | 1,000 |
Allocation shares, outstanding | 1,000 | 1,000 |
Allocation shares, shares outstanding | 1,000 | 1,000 |
Common shares, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common shares, shares authorized | 500,000,000 | 500,000,000 |
Common shares, shares issued | 4,079,137 | 1,210,918 |
Common shares, shares outstanding | 4,079,137 | 1,210,918 |
Series A Senior Convertible Preferred Shares | ||
Senior convertible preferred shares, shares designated | 4,450,460 | 4,450,460 |
Senior convertible preferred shares, shares issued | 1,593,940 | 1,818,182 |
Senior convertible preferred shares, shares outstanding | 1,593,940 | 1,818,182 |
Senior convertible preferred shares, par value (in Dollars) | ||
Series B Senior Convertible Preferred Shares | ||
Senior convertible preferred shares, shares designated | 583,334 | 583,334 |
Senior convertible preferred shares, shares issued | 464,899 | 0 |
Senior convertible preferred shares, shares outstanding | 464,899 | 0 |
Senior convertible preferred shares, par value (in Dollars) |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenues | $ 14,472,361 | $ 6,735,028 | $ 39,437,482 | $ 18,163,257 |
Operating Expenses | ||||
Cost of sales | 9,596,387 | 4,573,123 | 25,109,863 | 12,348,594 |
Personnel | 3,182,286 | 876,991 | 6,446,145 | 2,198,231 |
Depreciation and amortization | 516,414 | 299,477 | 1,526,759 | 547,655 |
General and administrative | 2,688,877 | 1,844,979 | 7,451,079 | 4,519,504 |
Total Operating Expenses | 15,983,964 | 7,594,570 | 40,533,846 | 19,613,984 |
LOSS FROM OPERATIONS | (1,511,603) | (859,542) | (1,096,364) | (1,450,727) |
Other Income (Expense) | ||||
Other income | 2,756 | 3,539 | 3,431 | |
Interest expense | (1,875,757) | (128,199) | (3,714,623) | (309,832) |
Gain on forgiveness of debt | 360,302 | |||
Gain on disposal of property and equipment | 15,614 | 10,885 | 47,690 | 10,885 |
Gain on disposition of subsidiary | 3,282,804 | |||
Loss on extinguishment of debt | (2,039,815) | (2,039,815) | (757,792) | |
Loss on write-down of contingent note payable | (158,817) | (158,817) | ||
Total Other Income (Expense) | (4,056,019) | (113,775) | (5,862,134) | 2,586,367 |
NET INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (5,567,622) | (973,317) | (6,958,498) | 1,135,640 |
INCOME TAX BENEFIT FROM CONTINUING OPERATIONS | 1,095,000 | 1,411,000 | 21,900 | |
NET INCOME (LOSS) FROM CONTINUING OPERATIONS | (4,472,622) | (973,317) | (5,547,498) | 1,157,540 |
NET INCOME FROM DISCONTINUED OPERATIONS | 240,405 | |||
NET INCOME (LOSS) | (4,472,622) | (973,317) | (5,547,498) | 1,397,945 |
NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTERESTS FROM CONTINUING OPERATIONS | (399,106) | (65,008) | (456,500) | (106,628) |
NET INCOME ATTRIBUTABLE TO NON-CONTROLLING INTERESTS FROM DISCONTINUED OPERATIONS | 108,182 | |||
NET INCOME (LOSS) ATTRIBUTABLE TO 1847 HOLDINGS | (4,073,516) | (908,309) | (5,090,998) | 1,396,391 |
NET INCOME (LOSS) FROM CONTINUING OPERATIONS ATTRIBUTABLE TO 1847 HOLDINGS | (4,073,516) | (908,309) | (5,090,998) | 1,264,168 |
NET INCOME FROM DISCONTINUED OPERATIONS ATTRIBUTABLE TO 1847 HOLDINGS | 132,223 | |||
PREFERRED SHARE DIVIDENDS | (353,816) | (314,093) | (697,312) | (2,340,567) |
DEEMED DIVIDEND RELATED TO DOWN ROUND PROVISION IN WARRANTS | (9,012,730) | (9,012,730) | ||
NET LOSS ATTRIBUTABLE TO 1847 HOLDINGS COMMON SHAREHOLDERS | $ (13,440,062) | $ (1,222,402) | $ (14,801,040) | $ (944,176) |
BASIC | ||||
LOSS PER COMMON SHARE FROM CONTINUING OPERATIONS (in Dollars per share) | $ (4.51) | $ (1.01) | $ (8.08) | $ (0.91) |
EARNINGS PER COMMON SHARE FROM DISCONTINUED OPERATIONS (in Dollars per share) | 0.11 | |||
LOSS PER COMMON SHARE (in Dollars per share) | (4.51) | (1.01) | (8.08) | (0.8) |
DILUTED | ||||
LOSS PER COMMON SHARE FROM CONTINUING OPERATIONS (in Dollars per share) | (4.51) | (1.01) | (8.08) | (0.52) |
EARNINGS PER COMMON SHARE FROM DISCONTINUED OPERATIONS (in Dollars per share) | 0.06 | |||
LOSS PER COMMON SHARE (in Dollars per share) | $ (4.51) | $ (1.01) | $ (8.08) | $ (0.46) |
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | ||||
BASIC (in Shares) | 2,979,949 | 1,210,918 | 1,832,076 | 1,179,873 |
DILUTED (in Shares) | 2,979,949 | 1,210,918 | 1,832,076 | 2,065,215 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Shareholders’ Equity (Deficit) (Unaudited) - USD ($) | Series A Senior Convertible Preferred Shares | Series B Senior Convertible Preferred Shares | Allocation Shares | Common Shares | Distribution Receivable | Additional Paid-In Capital | Accumulated Deficit | Non- Controlling Interests | Total |
Balance at Dec. 31, 2020 | $ 1,000 | $ 1,111 | $ (2,000,000) | $ 17,008,824 | $ (13,856,973) | $ (879,239) | $ 274,723 | ||
Balance (in Shares) at Dec. 31, 2020 | 1,111,208 | ||||||||
Issuance of series A senior convertible preferred shares and warrants | 3,000,000 | (1,527,086) | 1,472,914 | ||||||
Issuance of common adjustment shares | $ 100 | 757,692 | 757,792 | ||||||
Issuance of common adjustment shares (in Shares) | 99,710 | ||||||||
Dividends - series A senior convertible preferred shares | (188,709) | (188,709) | |||||||
Net loss | (730,441) | 54,959 | (675,482) | ||||||
Balance at Mar. 31, 2021 | 1,000 | $ 1,211 | (2,000,000) | 20,766,516 | (16,303,209) | (824,280) | 1,641,238 | ||
Balance (in Shares) at Mar. 31, 2021 | 1,210,918 | ||||||||
Balance at Dec. 31, 2020 | 1,000 | $ 1,111 | (2,000,000) | 17,008,824 | (13,856,973) | (879,239) | 274,723 | ||
Balance (in Shares) at Dec. 31, 2020 | 1,111,208 | ||||||||
Net loss | 1,397,945 | ||||||||
Balance at Sep. 30, 2021 | 1,000 | $ 1,211 | (2,000,000) | 20,766,516 | (14,801,150) | (877,685) | 3,089,892 | ||
Balance (in Shares) at Sep. 30, 2021 | 1,210,918 | ||||||||
Redemption of series A senior convertible preferred shares | |||||||||
Redemption of series B senior convertible preferred shares | |||||||||
Balance at Mar. 31, 2021 | 1,000 | $ 1,211 | (2,000,000) | 20,766,516 | (16,303,209) | (824,280) | 1,641,238 | ||
Balance (in Shares) at Mar. 31, 2021 | 1,210,918 | ||||||||
Net loss | 3,035,140 | 11,603 | 3,046,743 | ||||||
Balance at Jun. 30, 2021 | 1,000 | $ 1,211 | (2,000,000) | 20,766,516 | (13,578,748) | (812,677) | 4,377,302 | ||
Balance (in Shares) at Jun. 30, 2021 | 1,210,918 | ||||||||
Accrued dividend payable | (310,679) | (310,679) | |||||||
Net loss | (908,309) | (65,008) | (973,317) | ||||||
Balance at Sep. 30, 2021 | 1,000 | $ 1,211 | (2,000,000) | 20,766,516 | (14,801,150) | (877,685) | 3,089,892 | ||
Balance (in Shares) at Sep. 30, 2021 | 1,210,918 | ||||||||
Accrued dividend payable | (314,093) | (314,093) | |||||||
Balance at Dec. 31, 2021 | 1,000 | $ 1,211 | (2,000,000) | 21,723,042 | (20,754,394) | 930,812 | (98,329) | ||
Balance (in Shares) at Dec. 31, 2021 | 1,210,918 | ||||||||
Issuance of common shares upon conversion of series A preferred shares | $ 38 | 111,948 | 111,986 | ||||||
Issuance of common shares upon conversion of series A preferred shares (in Shares) | 38,096 | ||||||||
Issuance of series B convertible preferred shares and warrants | 152,350 | 152,350 | |||||||
Dividends - common shares | (249,762) | (249,762) | |||||||
Dividends - series A senior convertible preferred shares | (121,455) | (121,455) | |||||||
Dividends - series B senior convertible preferred shares | (13,760) | (13,760) | |||||||
Net loss | (873,030) | (54,178) | (927,208) | ||||||
Balance at Mar. 31, 2022 | 1,000 | $ 1,249 | (2,000,000) | 21,987,340 | (22,012,401) | 876,634 | (1,146,178) | ||
Balance (in Shares) at Mar. 31, 2022 | 1,249,014 | ||||||||
Balance at Dec. 31, 2021 | 1,000 | $ 1,211 | (2,000,000) | 21,723,042 | (20,754,394) | 930,812 | (98,329) | ||
Balance (in Shares) at Dec. 31, 2021 | 1,210,918 | ||||||||
Net loss | (5,547,498) | ||||||||
Balance at Sep. 30, 2022 | $ 1,338,746 | $ 1,214,181 | 1,000 | $ 4,079 | (2,000,000) | 43,962,606 | (36,648,788) | 474,312 | $ 8,346,136 |
Balance (in Shares) at Sep. 30, 2022 | 1,593,940 | 464,899 | 4,079,137 | ||||||
Issuance of common shares upon cashless exercise of warrants (in Shares) | 209,635 | ||||||||
Redemption of series A senior convertible preferred shares | $ 209,091 | ||||||||
Redemption of series B senior convertible preferred shares | 57,501 | ||||||||
Balance at Mar. 31, 2022 | 1,000 | $ 1,249 | (2,000,000) | 21,987,340 | (22,012,401) | 876,634 | (1,146,178) | ||
Balance (in Shares) at Mar. 31, 2022 | 1,249,014 | ||||||||
Issuance of series B convertible preferred shares and warrants | 19,700 | 19,700 | |||||||
Dividends - series A senior convertible preferred shares | (159,298) | (159,298) | |||||||
Dividends - series B senior convertible preferred shares | (48,983) | (48,983) | |||||||
Net loss | (144,452) | (3,216) | (147,668) | ||||||
Balance at Jun. 30, 2022 | 1,000 | $ 1,249 | (2,000,000) | 22,007,040 | (22,365,134) | 873,418 | (1,482,427) | ||
Balance (in Shares) at Jun. 30, 2022 | 1,249,014 | ||||||||
Dividends - common shares | (843,592) | (843,592) | |||||||
Dividends - series A senior convertible preferred shares | (156,738) | (156,738) | |||||||
Dividends - series B senior convertible preferred shares | (50,309) | (50,309) | |||||||
Deemed dividends - down round provision in warrants | 9,012,730,000,000 | (9,012,730,000,000) | |||||||
Net loss | (4,073,516) | (399,106) | (4,472,622) | ||||||
Balance at Sep. 30, 2022 | $ 1,338,746 | $ 1,214,181 | 1,000 | $ 4,079 | (2,000,000) | 43,962,606 | (36,648,788) | 474,312 | 8,346,136 |
Balance (in Shares) at Sep. 30, 2022 | 1,593,940 | 464,899 | 4,079,137 | ||||||
Issuance of warrants in connection with notes payable | 402,650 | 402,650 | |||||||
Issuance of common shares upon cashless exercise of warrants | $ 126 | (126) | |||||||
Issuance of common shares upon cashless exercise of warrants (in Shares) | 126,669 | ||||||||
Issuance of common shares upon partial extinguishment of convertible notes payable | $ 800 | 4,639,200 | 4,640,000 | ||||||
Issuance of common shares upon partial extinguishment of convertible notes payable (in Shares) | 800,000 | ||||||||
Issuance of common shares upon partial extinguishment of contingent note payable | $ 190 | 1,100,737 | 1,100,927 | ||||||
Issuance of common shares upon partial extinguishment of contingent note payable (in Shares) | 189,815 | ||||||||
Issuance of common shares upon settlement of debt | $ 285 | 1,653,104 | 1,653,389 | ||||||
Issuance of common shares upon settlement of debt (in Shares) | 285,067 | ||||||||
Reclassification of preferred shares from mezzanine equity to permanent equity | $ 1,415,100 | $ 1,257,650 | 2,672,750 | ||||||
Reclassification of preferred shares from mezzanine equity to permanent equity (in Shares) | 1,684,849 | 481,566 | |||||||
Issuance of common shares and warrants in connection with a public offering | $ 1,429 | 5,147,271 | 5,148,700 | ||||||
Issuance of common shares and warrants in connection with a public offering (in Shares) | 1,428,572 | ||||||||
Redemption of series A senior convertible preferred shares | $ (76,354) | (132,737) | (209,091) | ||||||
Redemption of series A senior convertible preferred shares (in Shares) | (90,909) | ||||||||
Redemption of series B senior convertible preferred shares | $ (43,469) | $ (14,032) | $ (57,501) | ||||||
Redemption of series B senior convertible preferred shares (in Shares) | (16,667) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ (5,547,498) | $ 1,397,945 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Loss from discontinued operations | (240,405) | |
Gain on disposition of subsidiary | (3,282,804) | |
Gain on forgiveness of debt | (360,302) | |
Gain on disposal of property and equipment | (47,690) | (10,885) |
Loss on adjustment shares | 757,792 | |
Loss on extinguishment of debt | 2,039,815 | |
Loss on write-down of contingent note payable | 158,817 | |
Deferred tax asset (liability) | (1,497,000) | (40,000) |
Depreciation and amortization | 1,526,759 | 547,656 |
Amortization of debt discounts | 1,697,572 | 27,537 |
Amortization of right-of-use assets | 409,641 | 90,322 |
Changes in operating assets and liabilities: | ||
Receivables | (1,957,022) | 271,395 |
Contract assets | (39,996) | |
Inventories | 670,699 | (141,543) |
Prepaid expenses and other current assets | (280,129) | 126,464 |
Other assets | 3,125 | |
Accounts payable and accrued expenses | 1,689,185 | 439,723 |
Contract liabilities | (1,965,568) | (106,561) |
Customer deposits | (488,593) | 225,618 |
Due to related parties | 3,569 | |
Operating lease liabilities | (349,403) | (86,867) |
Net cash used in operating activities from continuing operations | (3,977,286) | (381,346) |
Net cash used in operating activities from discontinued operations | (170,580) | |
Net cash used in operating activities | (3,977,286) | (551,926) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Net paid in acquisitions | (5,378,346) | |
Purchases of property and equipment | (255,930) | (262,852) |
Proceeds from disposal of property and equipment | 77,513 | 350,000 |
Investments in certificates of deposit | (527) | |
Net cash used in investing activities from continuing operations | (178,944) | (5,291,198) |
Net cash provided by investing activities from discontinued operations | 644,303 | |
Net cash used in investing activities | (178,944) | (4,646,895) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from notes payable | 499,600 | 3,673,405 |
Net proceeds from issuance of common shares and warrants in public offering | 5,148,700 | |
Net proceeds from issuance of series A senior convertible preferred shares | 3,000,000 | |
Net proceeds from issuance of series B senior convertible preferred shares | 1,429,700 | |
Proceeds from line of credit | 995,228 | |
Repayments of notes payable and finance lease liabilities | (810,315) | (584,012) |
Repayments to sellers | (977,685) | |
Cash paid for financing costs | (165,230) | |
Redemption of series A senior convertible preferred shares | (209,091) | |
Redemption of series B senior convertible preferred shares | (57,501) | |
Dividends on series A senior convertible preferred shares | (437,491) | (676,339) |
Dividends on series B senior convertible preferred shares | (113,052) | |
Dividends on common shares | (1,093,354) | |
Net cash provided by financing activities from continuing operations | 4,357,196 | 5,265,367 |
Net cash used in financing activities from discontinued operations | (208,693) | |
Net cash provided by financing activities | 4,357,196 | 5,056,674 |
NET CHANGE IN CASH AND CASH EQUIVALENTS FROM CONTINUING OPERATIONS | 200,966 | (407,177) |
NET CHANGE IN CASH AND CASH EQUIVALENT FROM DISCONTINUED OPERATIONS | 265,030 | |
CASH AND CASH EQUIVALENTS AVAILABLE FROM DISCONTINUED OPERATIONS | (265,030) | |
CASH AND CASH EQUIVALENTS FROM CONTINUING OPERATIONS | ||
Beginning of the period | 1,383,533 | 1,380,349 |
End of the period | 1,584,499 | 973,172 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Cash paid for interest | 1,576,964 | 139,016 |
Cash paid for income taxes | ||
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Issuance of common shares upon conversion of series A preferred shares | 111,986 | |
Issuance of common shares upon cashless exercise of warrants | 126 | |
Deemed dividend from down round provision in warrants | 9,012,730 | |
Financed purchases of property and equipment | 568,764 | |
Debt discount on notes payable issued with warrants | 503,050 | |
Operating lease right-of-use asset and liability remeasurement | $ 254,713 |
Basis of Presentation and Other
Basis of Presentation and Other Information | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation and Other Information [Abstract] | |
BASIS OF PRESENTATION AND OTHER INFORMATION | NOTE 1—BASIS OF PRESENTATION AND OTHER INFORMATION The accompanying unaudited condensed consolidated financial statements of 1847 Holdings LLC (the “Company,” “we,” “us,” or “our”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q of Regulation S-X. They do not include all information and footnotes required by GAAP for complete financial statements. The December 31, 2021 consolidated balance sheet data was derived from audited financial statements but do not include all disclosures required by GAAP. However, except as disclosed herein, there has been no material change in the information disclosed in the notes to the consolidated financial statements for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on March 31, 2022. The interim unaudited condensed consolidated financial statements should be read in conjunction with those consolidated financial statements included in the Form 10-K. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial statements, consisting solely of normal recurring adjustments, have been made. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022. Reverse Share Split On August 2, 2022, we effected a 1-for-4 reverse split of our outstanding common shares. All outstanding common shares and warrants were adjusted to reflect the 1-for-4 reverse split, with respective exercise prices of the warrants proportionately increased. The outstanding convertible notes and series A and B convertible senior preferred shares conversion prices were adjusted to reflect a proportional decrease in the number of common shares to be issued upon conversion. All share and per share data throughout these condensed consolidated financial statements have been retroactively adjusted to reflect the reverse share split. The total number of authorized common shares did not change. As a result of the reverse common share split, an amount equal to the decreased value of common shares was reclassified from “common shares” to “additional paid-in capital.” Reclassifications Certain reclassifications within property and equipment, notes payable, preferred shares, and operating expenses have been made to prior period’s financial statements to conform to the current period financial statement presentation. There is no impact in total to the results of operations and cash flows in all periods presented. Sequencing Under ASC 815-40-35 (“ASC 815”), the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest maturity date of potentially dilutive instruments first, with the earliest maturity date of grants receiving the first allocation of shares. Pursuant to ASC 815, issuances of securities to the Company’s employees and directors, or to compensate grantees in a share-based payment arrangement, are not subject to the sequencing policy. |
Recent Accounting Pronoucements
Recent Accounting Pronoucements | 9 Months Ended |
Sep. 30, 2022 | |
Recent Accounting Pronoucements [Abstract] | |
RECENT ACCOUNTING PRONOUCEMENTS | NOTE 2—RECENT ACCOUNTING PRONOUCEMENTS The Company considers the applicability and impact of all Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s condensed consolidated financial statements. In June 2016, the FASB issued ASU 2016-13 Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. ASU 2016-13 is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2019. This pronouncement was amended under ASU 2019-10 to allow an extension on the adoption date for entities that qualify as a small reporting company. The Company has elected this extension and the effective date for the Company to adopt this standard will be for fiscal years beginning after December 15, 2022. The Company has not completed its assessment of the standard but does not expect the adoption to have a material impact on our condensed consolidated financial statements. In August 2020, the FASB issued ASU 2020-06 Accounting for Convertible Instruments and Contracts In An Entity’s Own Equity. ASU 2020-06 simplifies the accounting for certain convertible instruments by removing the separation models for convertible debt with a cash conversion feature and for convertible instruments with a beneficial conversion feature. As a result, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. Additionally, ASU 2020-06 amends the diluted earnings per share calculation for convertible instruments by requiring the use of the if-converted method. The treasury stock method is no longer available. For SEC filers, excluding smaller reporting companies, ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company adopted this guidance on January 1, 2022. The Company’s adoption of this update did not have a material impact on the condensed consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU amends ASC 805 to require acquiring entities to apply ASC 606 to recognize and measure contract assets and contract liabilities in business combinations. The ASU is effective for public entities for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. This ASU should be applied prospectively to acquisitions occurring on or after the effective date of December 15, 2022, and early adoption is permitted. The Company adopted this guidance on January 1, 2022. The Company’s adoption of this update did not have a material impact on the condensed consolidated financial statements. |
Liquidity and Going Concern Ass
Liquidity and Going Concern Assessment | 9 Months Ended |
Sep. 30, 2022 | |
Liquidity and Going Concern Assessment [Line Items] | |
LIQUIDITY AND GOING CONCERN ASSESSMENT | NOTE 3—LIQUIDITY AND GOING CONCERN ASSESSMENT Management assesses liquidity and going concern uncertainty in the Company’s condensed consolidated financial statements to determine whether there is sufficient cash on hand and working capital, including available borrowings on loans, to operate for a period of at least one year from the date the consolidated financial statements are issued or available to be issued, which is referred to as the “look-forward period”, as defined in GAAP. As part of this assessment, based on conditions that are known and reasonably knowable to management, management will consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including the timing and nature of projected cash expenditures or programs, its ability to delay or curtail expenditures or programs and its ability to raise additional capital, if necessary, among other factors. Based on this assessment, as necessary or applicable, management makes certain assumptions around implementing curtailments or delays in the nature and timing of programs and expenditures to the extent it deems probable those implementations can be achieved and management has the proper authority to execute them within the look-forward period. As of September 30, 2022, the Company had cash and cash equivalents of $1,584,499. For the nine months ended September 30, 2022, the Company incurred an operating loss of $1,096,364 (before deducting losses attributable to non-controlling interests), cash flows used in operations of $3,977,286, and working capital of $1,839,424. The Company has generated operating losses since its inception and has relied on cash on hand, sales of securities, external bank lines of credit, and issuance of third-party and related party debt to support cashflow from operations. Management has prepared estimates of operations for fiscal year 2022 and 2023 believes that sufficient funds will be generated from operations to fund its operations and to service its debt obligations for one year from the date of the filing of these condensed consolidated financial statements, which indicate improved operations and the Company’s ability to continue operations as a going concern. The impact of COVID-19 on the Company’s business has been considered in these assumptions; however, it is too early to know the full impact of COVID-19 or its timing on a return to more normal operations. The accompanying condensed consolidated financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize its assets and satisfy its liabilities in the normal course of business. Management believes that based on relevant conditions and events that are known and reasonably knowable that its forecasts for one year from the date of the filing of these condensed consolidated financial statements. The Company has contingency plans to reduce or defer expenses and cash outlays should operations not improve in the look forward period. |
Disaggregation of Revenues and
Disaggregation of Revenues and Segment Reporting | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
DISAGGREGATION OF REVENUES AND SEGMENT REPORTING | NOTE 4—DISAGGREGATION OF REVENUES AND SEGMENT REPORTING The Company has three reportable segments: The Retail and Appliances Segment provides a wide variety of appliance products (laundry, refrigeration, cooking, dishwashers, outdoor, accessories, parts, and other appliance related products) and services (delivery, installation, service and repair, extended warranties, and financing). The Construction Segment provides finished carpentry products and services (door frames, base boards, crown molding, cabinetry, bathroom sinks and cabinets, bookcases, built-in closets, fireplace mantles, windows, and custom design and build of cabinetry and countertops). The Automotive Supplies Segment provides horn and safety products (electric, air, truck, marine, motorcycle, and industrial equipment), and offers vehicle emergency and safety warning lights for cars, trucks, industrial equipment, and emergency vehicles. The Company provides general corporate services to its segments; however, these services are not considered when making operating decisions and assessing segment performance. These services are reported under “Corporate Services” below and these include costs associated with executive management, financing activities and public company compliance. The Company’s revenues for the three and nine months ended September 30, 2022 and 2021 are disaggregated as follows: Three Months Ended September 30, 2022 Retail and Construction Automotive Total Revenues Appliances $ 2,492,544 $ - $ - $ 2,492,544 Appliance accessories, parts, and other 442,161 - - 442,161 Automotive horns - - 1,094,636 1,094,636 Automotive lighting - - 395,074 395,074 Custom cabinets and countertops - 2,990,767 - 2,990,767 Finished carpentry - 7,057,179 - 7,057,179 Total Revenues $ 2,934,705 $ 10,047,946 $ 1,489,710 $ 14,472,361 Three Months Ended September 30, 2021 Retail and Construction Automotive Total Revenues Appliances $ 2,745,305 $ - $ - $ 2,745,305 Appliance accessories, parts, and other 400,650 - - 400,650 Automotive horns - 1,694,928 1,694,928 Automotive lighting - - 555,717 555,717 Custom cabinets and countertops - 1,338,428 - 1,338,428 Finished carpentry - - - - Total Revenues $ 3,145,955 $ 1,338,428 $ 2,250,645 $ 6,735,028 Nine Months Ended September 30, 2022 Retail and Construction Automotive Total Revenues Appliances $ 7,206,386 $ - $ - $ 7,206,386 Appliance accessories, parts, and other 1,116,114 - - 1,116,114 Automotive horns - - 3,766,415 3,766,415 Automotive lighting - - 1,348,340 1,348,340 Custom cabinets and countertops - 10,288,711 - 10,288,711 Finished carpentry - 15,711,516 - 15,711,516 Total Revenues $ 8,322,500 $ 26,000,227 $ 5,114,755 $ 39,437,482 Nine Months Ended September 30, 2021 Retail and Construction Automotive Total Revenues Appliances $ 8,587,939 $ - $ - $ 8,587,939 Appliance accessories, parts, and other 1,175,000 - - 1,175,000 Automotive horns - - 3,326,835 3,326,835 Automotive lighting - - 904,178 904,178 Custom cabinets and countertops - 4,169,305 - 4,169,305 Finished carpentry - - - - Total Revenues $ 9,762,939 $ 4,169,305 $ 4,231,013 $ 18,163,257 Segment information for the three and nine months ended September 30, 2022 and 2021 is as follows: Three Months Ended September 30, 2022 Retail and Construction Automotive Corporate Total Revenues $ 2,934,705 $ 10,047,946 $ 1,489,710 $ - $ 14,472,361 Operating expenses Cost of sales 2,183,972 6,544,843 867,572 - 9,596,387 Personnel 202,443 2,406,195 277,398 296,250 3,182,286 Depreciation and amortization 48,019 416,525 51,870 - 516,414 General and administrative 494,719 1,245,668 384,870 563,620 2,688,877 Total Operating Expenses 2,929,153 10,613,231 1,581,710 859,870 15,983,964 Income (loss) from Operations $ 5,552 $ (565,285 ) $ (92,000 ) $ (859,870 ) $ (1,511,603 ) Three Months Ended September 30, 2021 Retail and Construction Automotive Corporate Total Revenues $ 3,145,955 $ 1,338,428 $ 2,250,645 $ - $ 6,735,028 Operating expenses Cost of sales 2,300,663 805,513 1,466,947 - 4,573,123 Personnel 196,592 273,366 407,034 - 876,992 Depreciation and amortization 47,104 83,112 169,260 - 299,476 General and administrative 439,414 256,402 673,484 475,679 1,844,979 Total Operating Expenses 2,983,774 1,418,393 2,716,724 475,679 7,594,570 Income (Loss) from Operations $ 162,182 $ (79,965 ) $ (466,080 ) $ (475,679 ) $ (859,542 ) Nine Months Ended September 30, 2022 Retail and Construction Automotive Corporate Total Revenues $ 8,322,500 $ 26,000,227 $ 5,114,755 $ - $ 39,437,482 Operating expenses Cost of sales 6,245,993 15,835,830 3,028,040 - 25,109,863 Personnel 587,073 4,715,419 847,403 296,250 6,446,145 Depreciation and amortization 175,835 1,195,314 155,610 - 1,526,759 General and administrative 1,480,465 4,006,636 1,188,618 775,360 7,451,079 Total Operating Expenses 8,489,366 25,753,199 5,219,671 1,071,610 40,533,846 Income (Loss) from Operations $ (166,866 ) $ 247,028 $ (104,916 ) $ (1,071,610 ) $ (1,096,364 ) Nine Months Ended September 30, 2021 Retail and Construction Automotive Corporate Total Revenues $ 9,762,939 $ 4,169,305 $ 4,231,013 $ - $ 18,163,257 Operating expenses - Cost of sales 7,409,913 2,280,009 2,658,672 - 12,348,594 Personnel 688,842 739,711 769,678 - 2,198,231 Depreciation and amortization 135,782 242,613 169,260 - 547,655 General and administrative 1,270,655 705,674 1,570,070 973,105 4,519,504 Total Operating Expenses 9,505,192 3,968,007 5,167,680 973,105 19,613,984 Income (Loss) from Operations $ 257,747 $ 201,298 $ (936,667 ) $ (973,105 ) $ (1,450,727 ) |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5—PROPERTY AND EQUIPMENT Property and equipment at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Equipment and machinery $ 1,401,103 $ 808,592 Office furniture and equipment 156,544 105,203 Transportation equipment 911,426 864,121 Leasehold improvements 169,143 112,356 Total property and equipment 2,638,216 1,890,272 Less: Accumulated depreciation (588,720 ) (194,961 ) Property and equipment, net $ 2,049,496 $ 1,695,311 Depreciation expense for the three and nine months ended September 30, 2022 was $151,722 and $432,683, respectively. Depreciation expense for the three and nine months ended September 30, 2021 was $32,420 and $85,005, respectively. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2022 | |
Intangible Assets [Abstract] | |
INTANGIBLE ASSETS | NOTE 6—INTANGIBLE ASSETS Intangible assets at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Customer relationships $ 5,791,000 $ 5,791,000 Marketing-related 5,917,000 5,917,000 Technology-related 623,000 623,000 Total intangible assets 12,331,000 12,331,000 Less: accumulated amortization (1,981,179 ) (887,103 ) Intangible assets, net $ 10,349,821 $ 11,443,897 Amortization expense for the three and nine months ended September 30, 2022 was $364,692 and $1,094,076, respectively. Amortization expense for the three and nine months ended September 30, 2021 was $267,057 and $462,651, respectively. Estimated amortization expense for intangible assets for the next five years consists of the following as of September 30, 2022: Year Ending December 31, Amount 2022 – remaining $ 364,704 2023 1,458,780 2024 1,458,750 2025 1,325,745 2026 1,157,523 Thereafter 4,584,319 Total $ 10,349,821 |
Selected Account Information
Selected Account Information | 9 Months Ended |
Sep. 30, 2022 | |
Selected Account Information [Abstract] | |
SELECTED ACCOUNT INFORMATION | NOTE 7—SELECTED ACCOUNT INFORMATION Receivables at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Trade accounts receivable $ 5,110,116 $ 2,691,702 Vendor rebates receivable 139,322 126,118 Credit card payments in process of settlement - 116,187 Retainage 445,580 803,989 Total receivables 5,695,018 3,737,996 Allowance for doubtful accounts (359,000 ) (359,000 ) Total receivables, net $ 5,336,018 $ 3,378,996 Inventories at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Appliances $ 2,146,254 $ 2,206,336 Automotive 1,248,947 2,064,834 Construction 1,749,250 1,543,980 Total inventories 5,144,451 5,815,150 Less reserve for obsolescence (387,848 ) (387,848 ) Total inventories, net $ 4,756,603 $ 5,427,302 Inventory balances are composed of finished goods. Raw materials and work in process inventory are immaterial to the condensed consolidated financial statements. Accounts payable and accrued expenses at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Trade accounts payable $ 2,705,828 $ 3,117,825 Credit cards payable 130,013 52,300 Accrued payroll liabilities 630,846 263,590 Accrued interest 1,045,917 711,258 Accrued dividends 644,139 242,160 Other accrued liabilities 282,152 431,539 Total accounts payable and accrued expenses $ 5,438,895 $ 4,818,672 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
LEASES | NOTE 8—LEASES Operating Leases In April 2022, the Company entered into a lease amendment to renew its office and warehouse space in the automotive supplies segment, located in Deer Park, New York. The lease renewal will commence on August 1, 2022 and shall expire on July 31, 2025. Under the terms of the lease renewal, the Company will lease the premises at the monthly rate of $7,518 for the first year, with scheduled annual increases. The lease agreement contains customary events of default, representations, warranties, and covenants. The remeasurement of the ROU asset and liability associated with this operating lease was $254,713. The following was included in our condensed consolidated balance sheet at September 30, 2022 and December 31, 2021: September 30, December 31, Operating lease right-of-use assets $ 3,037,676 $ 3,192,604 Lease liabilities, current portion 707,419 613,696 Lease liabilities, long-term 2,419,449 2,607,862 Total operating lease liabilities $ 3,126,868 $ 3,221,558 Weighted-average remaining lease term (months) 49 59 Weighted average discount rate 4.37 % 4.29 % Rent expense for the three and nine months ended September 30, 2022 was $278,823 and $804,544, respectively. As of September 30, 2022, maturities of operating lease liabilities were as follows: Year Ending December 31, Amount 2022 – remaining $ 239,421 2023 830,221 2024 848,210 2025 803,685 2026 514,079 Thereafter 194,495 Total 3,430,111 Less: imputed interest (303,243 ) Total operating lease liabilities $ 3,126,868 Finance Leases On March 28, 2022, the Company entered an equipment financing lease to purchase machinery and equipment totaling $316,798, maturing in January 2028. On April 11, 2022, the Company entered in an equipment financing lease to purchase machinery and equipment totaling $11,706, maturing in June 2027. On July 13, 2022, the Company entered in an equipment financing lease to purchase machinery and equipment totaling $240,260, maturing in June 2028. As of September 30, 2022, maturities of finance lease liabilities were as follows: Year Ending December 31, Amount 2022 – remaining $ 58,482 2023 234,556 2024 218,099 2025 211,332 2026 211,332 Thereafter 238,875 Total payments 1,172,676 Less: amount representing interest (158,003 ) Present value of minimum finance lease payments $ 1,014,673 As of September 30, 2022, the weighted-average remaining lease term for all finance leases is 5.20 years. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2022 | |
Acquisitions [Abstract] | |
ACQUISITIONS | NOTE 9—ACQUISITIONS On March 30, 2021, the Company acquired 100% of the outstanding capital stock of Wolo Mfg. Corp and Wolo Industrial Horn & Signal, Inc. (“Wolo”) for an aggregate purchase price of $8,344,056. For the three and nine months ended September 30, 2022, Wolo contributed revenue of $1,489,710 and $5,114,755, respectively, and net loss from continuing operations of $393,493 and $1,034,427, respectively, which are included in our condensed consolidated statements of operations for the three and nine months ended September 30, 2022. On October 8, 2021, the Company acquired 100% of the outstanding capital stock of High Mountain Door & Trim, Inc. (“High Mountain”) and Sierra Homes, LLC (“Sierra Homes”) for an aggregate purchase price of $15,441,173. For the three and nine months ended September 30, 2022, High Mountain and Sierra Homes contributed combined revenue of $8,299,589 and $21,049,530, respectively, and combined net loss from continuing operations of $2,846,780 and $3,633,437, respectively, which are included in our condensed consolidated statements of operations for the three and nine months ended September 30, 2022. Pro Forma Information The following unaudited pro forma results presented below include the effects of the Wolo, High Mountain and Sierra Homes acquisitions as if they had been consummated as of January 1, 2021, with adjustments to give effect to pro forma events that are directly attributable to the acquisitions. Three Months Ended Nine Months Ended 2022 2021 2022 2021 Revenues $ 14,472,361 $ 15,328,672 $ 39,437,482 $ 39,091,277 Net income (loss) (4,472,622 ) 100,042 (5,547,498 ) 3,956,288 Net income (loss) attributable to common shareholders’ (13,440,062 ) (149,043 ) (14,801,040 ) 1,614,167 Earnings (loss) per share attributable to common shareholders’: Basic $ (4.51 ) $ (0.12 ) $ (8.08 ) $ 1.37 Diluted $ (4.51 ) $ (0.12 ) $ (8.08 ) $ 0.78 These unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations would have been if the acquisitions had occurred at the beginning of the period presented, nor are they indicative of future results of operations. |
Related Parties
Related Parties | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES | NOTE 10—RELATED PARTIES Management Services Agreement On April 15, 2013, the Company and 1847 Partners LLC (the “Manager”) entered into a management services agreement, pursuant to which the Company is required to pay the Manager a quarterly management fee equal to 0.5% of its adjusted net assets for services performed (the “Parent Management Fee”). The amount of the Parent Management Fee with respect to any fiscal quarter is (i) reduced by the aggregate amount of any management fees received by the Manager under any offsetting management services agreements with respect to such fiscal quarter, (ii) reduced (or increased) by the amount of any over-paid (or under-paid) Parent Management Fees received by (or owed to) the Manager as of the end of such fiscal quarter, and (iii) increased by the amount of any outstanding accrued and unpaid Parent Management Fees. The Company expensed $0 in Parent Management Fees for the three and nine months ended September 30, 2022 and $0 for the three and nine months ended September 30, 2021. Offsetting Management Services Agreements The Company’s subsidiary 1847 Asien Inc. (“1847 Asien”) entered into an offsetting management services agreement with the Manager on May 28, 2020, the Company’s subsidiary 1847 Cabinet Inc. (“1847 Cabinet”) entered into an offsetting management services agreement with the Manager on August 21, 2020 (which was amended and restated on October 8, 2021) and the Company’s subsidiary 1847 Wolo Inc. (“1847 Wolo”) entered into an offsetting management services agreement with the Manager on March 30, 2021. Pursuant to the offsetting management services agreements, 1847 Asien appointed the Manager to provide certain services to it for a quarterly management fee equal to the greater of $75,000 or 2% of adjusted net assets (as defined in the management services agreement), 1847 Cabinet appointed the Manager to provide certain services to it for a quarterly management fee equal to the greater of $75,000 or 2% of adjusted net assets (as defined in the management services agreement), which was increased to $125,000 or 2% of adjusted net assets on October 8, 2021, and 1847 Wolo appointed the Manager to provide certain services to it for a quarterly management fee equal to the greater of $75,000 or 2% of adjusted net assets (as defined in the management services agreement); provided, however, in each case that if the aggregate amount of management fees paid or to be paid by such entities, together with all other management fees paid or to be paid to the Manager under other offsetting management services agreements, exceeds, or is expected to exceed, 9.5% of our gross income in any fiscal year or the Parent Management Fee in any fiscal quarter, then the management fee to be paid by such entities shall be reduced, on a pro rata basis determined by reference to the other management fees to be paid to the Manager under other offsetting management services agreements. 1847 Asien expensed management fees of $75,000 and $225,000 for the three and nine months ended September 30, 2022, respectively, and $75,000 and $225,000 for the three and nine months ended September 30, 2021, respectively. 1847 Cabinet expensed management fees of $125,000 and $375,000 for the three and nine months ended September 30, 2022, respectively, and $75,000 and $225,000 for the three and nine months ended September 30, 2021, respectively. 1847 Wolo expensed management fees of $75,000 and $225,000 for the three and nine months ended September 30, 2022, respectively, and $75,000 and $150,000 for the three and nine months ended September 30, 2021, respectively. On a consolidated basis, the Company expensed total management fees of $275,000 and $825,000 for the three and nine months ended September 30, 2022, respectively, and $225,000 and $600,000 for the three and nine months ended September 30, 2021, respectively. Advances From time to time, the Company has received advances from its chief executive officer to meet short-term working capital needs. As of September 30, 2022 and December 31, 2021, a total of $118,834 in advances from related parties are outstanding. These advances are unsecured, bear no interest, and do not have formal repayment terms or arrangements. As of September 30, 2022 and December 31, 2021, the Manager has funded the Company $74,928 in related party advances. These advances are unsecured, bear no interest, and do not have formal repayment terms or arrangements. Building Lease On September 1, 2020, Kyle’s entered into an industrial lease agreement with Stephen Mallatt, Jr. and Rita Mallatt, who are officers of Kyle’s and principal shareholders of the Company. The lease is for a term of five years, with an option for a renewal term of five years and provides for a base rent of $7,000 per month for the first 12 months, which will increase to $7,210 for months 13-16 and to $7,426 for months 37-60. In addition, Kyle’s is responsible for all taxes, insurance and certain operating costs during the lease term. The total rent expense under this related party leases was $21,777 and $65,330 for the three and nine months ended September 30, 2022. |
Mezzanine Equity
Mezzanine Equity | 9 Months Ended |
Sep. 30, 2022 | |
Temporary Equity Disclosure [Abstract] | |
MEZZANINE EQUITY | NOTE 11—MEZZANINE EQUITY Series A Senior Convertible Preferred Shares On September 30, 2020, the Company executed a share designation, which was amended on November 20, 2020, March 26, 2021 and September 29, 2021, to designate 4,450,460 of its shares as series A senior convertible preferred shares. Following is a description of the rights of the series A senior convertible preferred shares. Ranking. Dividend Rights. Liquidation Rights. Voting Rights Conversion Rights Redemption Rights Adjustments ● On the first day of the 12 th the issuance date of any ● On the first day of the 24 th the issuance date of any ● On the first day of the 36 th the issuance date of any shall automatically increase by ten percent (10%) and the conversion price shall automatically adjust to the lower of the (i) initial conversion price and (ii) the price equal to the lowest VWAP of the ten (10) trading days immediately preceding the third adjustment date. Notwithstanding the foregoing, the conversion price for purposes of the adjustments above shall not be adjusted to a number that is below $0.03. In addition, if any legislation or rules are adopted whereby the holding period of securities for purposes of Rule 144 of the Securities Act of 1933, as amended, for convertible securities that convert at market-adjusted rates is increased resulting in a longer holding period for convertible securities like the series A senior convertible preferred shares and the unavailability at the time of conversion of Rule 144, the pricing provisions that are based upon the lowest VWAP of the previous ten (10) trading days immediately preceding the relevant adjustment date shall be removed unless the common shares issuable upon conversion are then registered under an effective registration statement. Additional Equity Interest. As of September 30, 2022 and December 31, 2021, the Company had 1,593,940 and 1,818,182 series A senior convertible preferred shares issued and outstanding, respectively. During the three months ended September 30, 2022, the Company accrued dividends attributable to the series A senior convertible preferred shares in the amount of $156,738 and paid prior period accrued dividends of $174,701. During the nine months ended September 30, 2022, the Company accrued dividends attributable to the series A senior convertible preferred shares in the amount of $437,491 and paid prior period accrued dividends of $462,925. On February 16, 2022, 133,333 shares of series A senior convertible preferred shares were converted into 38,096 common shares. On August 12, 2022, the Company redeemed 90,909 series A senior convertible preferred shares for a total redemption price of $209,091. Series B Senior Convertible Preferred Shares On February 17, 2022, the Company executed a share designation to designate 583,334 of its shares as series B senior convertible preferred shares. Following is a description of the rights of the series B senior convertible preferred shares. Ranking. Dividend Rights Liquidation Rights. Voting Rights Conversion Rights Redemption Rights Adjustments ● On the first day of the 12 th the issuance of the first ● On the first day of the 24 th ● On the first day of the 36 th Notwithstanding the foregoing, the conversion price for purposes of the adjustments above shall not be adjusted to a number that is below $0.03 per share (subject to adjustment for splits or dividends of the common shares). In addition, if any legislation or rules are adopted whereby the holding period of securities for purposes of Rule 144 of the Securities Act of 1933, as amended, for convertible securities that convert at market-adjusted rates is increased resulting in a longer holding period for convertible securities like the series B senior convertible preferred shares and the unavailability at the time of conversion of Rule 144, the pricing provisions that are based upon the lowest VWAP of the previous ten (10) trading days immediately preceding the relevant adjustment date shall be removed unless the common shares issuable upon conversion are then registered under an effective registration statement. From February 24, 2022 to March 24, 2022, the Company sold an aggregate of 426,999 units, at a price of $3.00 per unit, for aggregate gross proceeds of $1,281,000. From April 20, 2022 to May 19, 2022, the Company sold an aggregate of 54,567 units to our Chief Executive Officer, Ellery W. Roberts, for aggregate gross proceeds of $163,700. The Company had total issuance costs relating to these offerings of approximately $15,000, resulting in net proceeds of $1,429,700. Each unit consists of one (1) series B senior convertible preferred share and a three-year warrant to purchase one (1) common share at an exercise price of $3.00 per common share (subject to adjustment), which may be exercised on a cashless basis under certain circumstances. The embedded conversion options of the series B senior convertible preferred shares and warrants were clearly and closely related to the equity host and did not require bifurcation. The $1,429,700 of net proceeds were allocated on a relative fair value basis of $1,257,650 to the series B preferred shares and $172,050 to the warrants. The series B preferred shares fair value was derived using an Option Pricing Method and the warrants fair value was derived using a Monte Carlo Simulation Model. As of September 30, 2022 and December 31, 2021, the Company had 464,899 and 0 series B senior convertible preferred shares issued and outstanding, respectively. During the three months ended September 30, 2022, the Company accrued dividends attributable to the series B senior convertible preferred shares in the amount of $50,309 and paid prior period accrued dividends of $48,197. During the nine months ended September 30, 2022, the Company accrued dividends attributable to the series B senior convertible preferred shares in the amount of $113,052 and paid prior period accrued dividends of $77,548. On August 26, 2022, the Company redeemed 16,667 series B senior convertible preferred shares for a total redemption price of $57,501. Mezzanine Equity Classification We applied the guidance in ASC 480, “Distinguishing Liabilities from Equity” (“ASC 480”) and ASC 815, “Derivatives and Hedging” (“ASC 815”), in order to determine the appropriate classification for both the series A senior convertible preferred shares and the series B senior convertible preferred shares. ASC 480 requires equity instruments to be evaluated on an ongoing basis for mezzanine equity (temporary equity) vs permanent equity classification. As a result of the maximum number of common shares that may be issuable (upon conversion of the preferred securities) exceeded the number of authorized but unissued common shares available, temporary equity classification is required. As of December 31, 2021, there were 1,818,182 series A senior convertible preferred shares presented in mezzanine equity. As a result of the 1-for-4 reverse split of our outstanding common shares (see Note 1 for additional information), the maximum number of common shares that may be issuable (upon conversion of the preferred securities) no longer exceeded the number of unissued common shares available, resulting in the reclassification of 1,684,849 series A senior convertible preferred shares and 481,566 series B senior convertible preferred shares from mezzanine equity to permanent equity. |
Shareholders_ Deficit
Shareholders’ Deficit | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS’ DEFICIT | NOTE 12—SHAREHOLDERS’ DEFICIT Reverse Stock Split The Company’s board of directors approved a 1-for-4 reverse stock split of its issued, outstanding common shares, which became effective August 2, 2022. See Note 1 for additional information. Common Shares As of September 30, 2022, the Company was authorized to issue 500,000,000 common shares. As of September 30, 2022 and December 31, 2021, the Company had 4,079,137 and 1,210,918 common shares issued and outstanding, respectively. On February 16, 2022, the Company issued 38,096 common shares upon the conversion of 133,333 series A senior convertible preferred shares. From July 12, 2022 to September 15, 2022, the Company issued 126,669 common shares upon cashless exercises of a warrants. On August 2, 2022, the Company entered into an underwriting agreement with Craft Capital Management LLC and R.F. Lafferty & Co. Inc., as representatives of the underwriters named on Schedule 1 thereto, relating to the Company’s public offering of common shares. Under the underwriting agreement, the Company agreed to sell 1,428,572 common shares to the underwriters, at a gross purchase price per share of $4.20 per share, pursuant to the Company’s registration statement on Form S-1 (File No. 333-259011) under the Securities Act of 1933, as amended. On August 5, 2022, the closing of the public offering was completed and the Company sold 1,428,572 common shares for total gross proceeds of $6 million. After deducting underwriting commissions and expenses, the Company received net proceeds of approximately $5.15 million. On August 2, 2022, the Company issued an aggregate of 800,000 common shares upon the partial extinguishment of convertible promissory notes. On October 8, 2021, 1847 Cabinet issued 6% subordinated convertible promissory notes in the aggregate principal amount of $5,880,345 to Steven J. Parkey and Jose D. Garcia-Rendon. On July 26, 2022, the Company and 1847 Cabinet entered into a conversion agreement with Steven J. Parkey and Jose D. Garcia-Rendon, pursuant to which they agreed to convert an aggregate of $3,360,000 of the convertible notes into an aggregate of 800,000 common shares of the Company at a conversion price of $4.20 per share. As a result, the Company recognized a loss on extinguishment of debt of $1,280,000. On August 2, 2022, the Company issued 189,815 common shares upon the partial extinguishment of a contingent note payable. On September 30, 2020, 1847 Cabinet Inc. issued an 8% vesting promissory note in the principal amount of up to $1,260,000 to Stephen Mallatt, Jr. and Rita Mallatt. On July 26, 2022, the Company and 1847 Cabinet entered into a conversion agreement with Stephen Mallatt, Jr. and Rita Mallatt, pursuant to which they agreed to convert $797,221 of the vesting note into 189,815 common shares of the Company at a conversion price of $4.20 per share. As a result, the Company recognized a loss on extinguishment of debt of $303,706. On August 2, 2022, the Company issued 285,067 common shares to Bevilacqua PLLC, the Company’s outside securities counsel, upon the settlement of accounts payable. On July 26, 2022, the Company also entered into a conversion agreement with Bevilacqua PLLC, pursuant to which it agreed to convert $1,197,280 of the accounts payable owed to it into 285,067 common shares of the Company at a conversion price of $4.20 per share. As a result, the Company recognized a loss on extinguishment of debt of $456,109. On March 23, 2022, the Company declared a common share dividend of $0.05 per share, or an aggregate of $249,762, to shareholders of record as of March 31, 2022. This dividend was paid on April 15, 2022. On July 29, 2022, the Company declared a common share dividend of $0.13125 per share, or an aggregate of $337,841, to shareholders of record as of August 4, 2022. This dividend was paid on August 19, 2022. On August 23, 2022, the Company declared a common share dividend of $0.13125 per share, or an aggregate of $505,751 to shareholders of record as of September 30, 2022. This dividend was paid on October 17, 2022. Warrants As described in Note 11, the Company issued units during the nine months ended September 30, 2022, with each unit consisting of one (1) series B senior convertible preferred share and a three-year warrant to purchase one (1) common share at an exercise price of $12.00 per common share (subject to adjustment), which such exercise price was adjusted to $4.20 following the adjustments described below. Accordingly, a portion of the proceeds were allocated to the warrant based on its relative fair value using the Geometric Brownian Motion Stock Path Monte Carlo Simulation. The assumptions used in the model were as follows: (i) dividend yield of 0%; (ii) expected volatility of 51.81%; (iii) weighted average risk-free interest rate of 0.31%; (iv) expected life of three years; (v) estimated fair value of the common shares of $7.76 per share; and (vi) various probability assumptions related to redemption, calls and price resets. The fair value of the warrants was $428,034, or $0.89 per warrant, resulting in the amount allocated to the warrants, based on their relative fair of $172,050, which was recorded as additional paid-in capital. The warrants allow the holder to purchase one (1) common share at an exercise price of $12.00 per common share (subject to adjustment including upon any future equity offering with a lower exercise price), which may be exercised on a cashless basis under certain circumstances. The Company may force the exercise of the warrants at any time after the one year anniversary of the date of the warrants, if (i) the Company is listed on a national securities exchange or the over-the-counter market, (ii) the underlying common shares are registered or the holder of the warrant otherwise has the ability to trade the underlying common shares without restriction, (iii) the 30-day volume-weighted daily average price of the common shares exceeds 200% of the exercise price, as adjusted, and (iv) the average daily trading volume is at least 100,000 common shares during such 30-day period. The Company may redeem the warrants held by any holder in whole (but not in part) by paying in cash to such holder as follows: (i) $0.50 per share then underlying the warrant if within the first twelve (12) months of issuance; (ii) $1.00 per share then underlying the warrant if after the first twelve (12) months, but before twenty-four (24) months of issuance; and (iii) $1.50 per share then underlying the warrant if after twenty-four months, but before thirty-six (36) months. On July 8, 2022, the Company entered into a securities purchase agreement with Mast Hill Fund, L.P., pursuant to which the Company issued to it a promissory note in the principal amount of $600,000, and a five-year warrant for the purchase of 100,000 common shares at an exercise price of $6.00 per share (subject to adjustment), which such exercise price was adjusted to $4.20 following the adjustments described below, which may be exercised on a cashless basis if the market price of the Company’s common shares is greater than the exercise price, for total net proceeds of $499,600. Additionally, the Company issued a three-year warrant to J.H. Darbie & Co (the broker) for the purchase of 3,600 common shares at an exercise price of $7.50 (subject to adjustment), which such exercise price was adjusted to $4.20 following the adjustments described below, which may be exercised on a cashless basis if the market price of the Company’s common shares is greater than the exercise price. Accordingly, a portion of the proceeds were allocated to the warrants based on its relative fair value using the Geometric Brownian Motion Stock Path Monte Carlo Simulation. The assumptions used in the model were as follows: (i) dividend yield of 0%; (ii) expected volatility of 49.11%; (iii) weighted average risk-free interest rate of 3.13%; (iv) expected life of five years; (v) estimated fair value of the common shares of $7.23 per share; and (vi) various probability assumptions related to down round price adjustments. The fair value of the warrants was $2,405,306, or $6.01 per warrant, resulting in the amount allocated to the warrants, based on their relative fair of $402,650, which was recorded as additional paid-in capital. On August 10, 2022, the promissory note was repaid in full. As a result of the issuance of the note to Mast Hill Fund, L.P. on July 8, 2022, the exercise price of certain of the Company’s outstanding warrants was adjusted to $5.20 pursuant to certain antidilution provisions of such warrants (down round feature). In addition, certain of the Company’s outstanding warrants include an “full ratchet” feature, whereby the exercise price was reset to $5.20 and the number of shares underlying the warrants was increased in the same proportion as the exercise price decrease. From July 12, 2022 to September 15, 2022, warrants for the purchase of 209,635 common shares were exercised on a cashless basis resulting in the issuance of 126,669 common shares. On August 5, 2022, the Company issued a common share purchase warrant to each of Craft Capital Management LLC and R.F. Lafferty & Co. Inc., the representatives of the underwriters for the public offering described above, for the purchase of 35,715 common shares at an exercise price of $5.25, subject to adjustments. The warrants will be exercisable at any time and from time to time, in whole or in part, during the period commencing on February 5, 2023 and ending on August 2, 2027 and may be exercised on a cashless basis under certain circumstances. As a result of the public offering, the exercise price of certain of the Company’s outstanding warrants was adjusted to $4.20 pursuant to certain antidilution provisions of such warrants (down round feature). In addition, certain of the Company’s outstanding warrants include an “full ratchet” feature, whereby the exercise price was reset to $4.20 and the number of shares underlying the warrants was increased in the same proportion as the exercise price decrease. Below is a table summarizing the changes in warrants outstanding during the nine months ended September 30, 2022: Warrants Weighted- Outstanding at December 31, 2021 1,300,122 $ 9.52 Granted (1) 1,978,432 5.25 Exercised (209,635 ) (5.58 ) Outstanding at September 30, 2022 3,068,919 $ 5.10 Exercisable at September 30, 2022 2,997,489 $ 5.10 (1) Includes the issuance of warrants for the purchase of 295,427 common shares and an increase of 1,683,005 common shares underlying warrants pursuant to the adjustments described above. As of September 30, 2022, the outstanding warrants have a weighted average remaining contractual life of 1.68 years and a total intrinsic value of $98,125. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | NOTE 13—EARNINGS (LOSS) PER SHARE The computation of weighted average shares outstanding and the basic and diluted loss per common share attributable to common shareholders for the three and nine months ended September 30, 2022 consisted of the following: Three Months Nine Months Net loss per common share attributable to common shareholders’ (13,440,062 ) $ (14,801,040 ) Weighted average common shares outstanding 2,979,949 1,832,076 Basic and diluted loss per share $ (4.51 ) $ (8.08 ) For the three and nine months ended September 30, 2022, there were 6,462,938 potential common share equivalents from warrants, convertible debt, and series A and B convertible preferred shares excluded from the diluted earnings per share calculations as their effect is anti-dilutive. For the three and nine months ended September 30, 2021, there were 547,459 potential common share equivalents from warrants excluded from the diluted earnings per share calculations as their effect is anti-dilutive. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 14—SUBSEQUENT EVENTS On October 20, 2022, 1847 Asien and Joerg Christian Wilhelmsen and Susan Kay Wilhelmsen, as trustees of the Wilhelmsen Family Trust, U/D/T Dated May 1, 1992 entered into a letter agreement to amend the terms of that certain 6% amortizing promissory note in the aggregate principal amount of $1,037,500. Pursuant to the letter agreement, the parties agreed to extend the maturity date of this note to February 28, 2023 and revised the repayment terms so that the outstanding principal amount and all accrued interest thereon shall be payable monthly, beginning on November 30, 2022, in accordance with the payment schedule set forth on Exhibit A to the letter agreement. As additional consideration for entering into the letter agreement, 1847 Asien also agreed to pay the lender $87,707 as an amendment fee. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation and Other Information [Abstract] | |
Reverse Share Split | Reverse Share Split On August 2, 2022, we effected a 1-for-4 reverse split of our outstanding common shares. All outstanding common shares and warrants were adjusted to reflect the 1-for-4 reverse split, with respective exercise prices of the warrants proportionately increased. The outstanding convertible notes and series A and B convertible senior preferred shares conversion prices were adjusted to reflect a proportional decrease in the number of common shares to be issued upon conversion. All share and per share data throughout these condensed consolidated financial statements have been retroactively adjusted to reflect the reverse share split. The total number of authorized common shares did not change. As a result of the reverse common share split, an amount equal to the decreased value of common shares was reclassified from “common shares” to “additional paid-in capital.” |
Reclassifications | Reclassifications Certain reclassifications within property and equipment, notes payable, preferred shares, and operating expenses have been made to prior period’s financial statements to conform to the current period financial statement presentation. There is no impact in total to the results of operations and cash flows in all periods presented. |
Sequencing | Sequencing Under ASC 815-40-35 (“ASC 815”), the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest maturity date of potentially dilutive instruments first, with the earliest maturity date of grants receiving the first allocation of shares. Pursuant to ASC 815, issuances of securities to the Company’s employees and directors, or to compensate grantees in a share-based payment arrangement, are not subject to the sequencing policy. |
Disaggregation of Revenues an_2
Disaggregation of Revenues and Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of revenues | Three Months Ended September 30, 2022 Retail and Construction Automotive Total Revenues Appliances $ 2,492,544 $ - $ - $ 2,492,544 Appliance accessories, parts, and other 442,161 - - 442,161 Automotive horns - - 1,094,636 1,094,636 Automotive lighting - - 395,074 395,074 Custom cabinets and countertops - 2,990,767 - 2,990,767 Finished carpentry - 7,057,179 - 7,057,179 Total Revenues $ 2,934,705 $ 10,047,946 $ 1,489,710 $ 14,472,361 Three Months Ended September 30, 2021 Retail and Construction Automotive Total Revenues Appliances $ 2,745,305 $ - $ - $ 2,745,305 Appliance accessories, parts, and other 400,650 - - 400,650 Automotive horns - 1,694,928 1,694,928 Automotive lighting - - 555,717 555,717 Custom cabinets and countertops - 1,338,428 - 1,338,428 Finished carpentry - - - - Total Revenues $ 3,145,955 $ 1,338,428 $ 2,250,645 $ 6,735,028 Nine Months Ended September 30, 2022 Retail and Construction Automotive Total Revenues Appliances $ 7,206,386 $ - $ - $ 7,206,386 Appliance accessories, parts, and other 1,116,114 - - 1,116,114 Automotive horns - - 3,766,415 3,766,415 Automotive lighting - - 1,348,340 1,348,340 Custom cabinets and countertops - 10,288,711 - 10,288,711 Finished carpentry - 15,711,516 - 15,711,516 Total Revenues $ 8,322,500 $ 26,000,227 $ 5,114,755 $ 39,437,482 Nine Months Ended September 30, 2021 Retail and Construction Automotive Total Revenues Appliances $ 8,587,939 $ - $ - $ 8,587,939 Appliance accessories, parts, and other 1,175,000 - - 1,175,000 Automotive horns - - 3,326,835 3,326,835 Automotive lighting - - 904,178 904,178 Custom cabinets and countertops - 4,169,305 - 4,169,305 Finished carpentry - - - - Total Revenues $ 9,762,939 $ 4,169,305 $ 4,231,013 $ 18,163,257 |
Schedule of segment information | Three Months Ended September 30, 2022 Retail and Construction Automotive Corporate Total Revenues $ 2,934,705 $ 10,047,946 $ 1,489,710 $ - $ 14,472,361 Operating expenses Cost of sales 2,183,972 6,544,843 867,572 - 9,596,387 Personnel 202,443 2,406,195 277,398 296,250 3,182,286 Depreciation and amortization 48,019 416,525 51,870 - 516,414 General and administrative 494,719 1,245,668 384,870 563,620 2,688,877 Total Operating Expenses 2,929,153 10,613,231 1,581,710 859,870 15,983,964 Income (loss) from Operations $ 5,552 $ (565,285 ) $ (92,000 ) $ (859,870 ) $ (1,511,603 ) Three Months Ended September 30, 2021 Retail and Construction Automotive Corporate Total Revenues $ 3,145,955 $ 1,338,428 $ 2,250,645 $ - $ 6,735,028 Operating expenses Cost of sales 2,300,663 805,513 1,466,947 - 4,573,123 Personnel 196,592 273,366 407,034 - 876,992 Depreciation and amortization 47,104 83,112 169,260 - 299,476 General and administrative 439,414 256,402 673,484 475,679 1,844,979 Total Operating Expenses 2,983,774 1,418,393 2,716,724 475,679 7,594,570 Income (Loss) from Operations $ 162,182 $ (79,965 ) $ (466,080 ) $ (475,679 ) $ (859,542 ) Nine Months Ended September 30, 2022 Retail and Construction Automotive Corporate Total Revenues $ 8,322,500 $ 26,000,227 $ 5,114,755 $ - $ 39,437,482 Operating expenses Cost of sales 6,245,993 15,835,830 3,028,040 - 25,109,863 Personnel 587,073 4,715,419 847,403 296,250 6,446,145 Depreciation and amortization 175,835 1,195,314 155,610 - 1,526,759 General and administrative 1,480,465 4,006,636 1,188,618 775,360 7,451,079 Total Operating Expenses 8,489,366 25,753,199 5,219,671 1,071,610 40,533,846 Income (Loss) from Operations $ (166,866 ) $ 247,028 $ (104,916 ) $ (1,071,610 ) $ (1,096,364 ) Nine Months Ended September 30, 2021 Retail and Construction Automotive Corporate Total Revenues $ 9,762,939 $ 4,169,305 $ 4,231,013 $ - $ 18,163,257 Operating expenses - Cost of sales 7,409,913 2,280,009 2,658,672 - 12,348,594 Personnel 688,842 739,711 769,678 - 2,198,231 Depreciation and amortization 135,782 242,613 169,260 - 547,655 General and administrative 1,270,655 705,674 1,570,070 973,105 4,519,504 Total Operating Expenses 9,505,192 3,968,007 5,167,680 973,105 19,613,984 Income (Loss) from Operations $ 257,747 $ 201,298 $ (936,667 ) $ (973,105 ) $ (1,450,727 ) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | September 30, December 31, Equipment and machinery $ 1,401,103 $ 808,592 Office furniture and equipment 156,544 105,203 Transportation equipment 911,426 864,121 Leasehold improvements 169,143 112,356 Total property and equipment 2,638,216 1,890,272 Less: Accumulated depreciation (588,720 ) (194,961 ) Property and equipment, net $ 2,049,496 $ 1,695,311 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Intangible Assets [Abstract] | |
Schedule of intangible assets | September 30, December 31, Customer relationships $ 5,791,000 $ 5,791,000 Marketing-related 5,917,000 5,917,000 Technology-related 623,000 623,000 Total intangible assets 12,331,000 12,331,000 Less: accumulated amortization (1,981,179 ) (887,103 ) Intangible assets, net $ 10,349,821 $ 11,443,897 |
Schedule of estimated amortization expense for intangible assets | Year Ending December 31, Amount 2022 – remaining $ 364,704 2023 1,458,780 2024 1,458,750 2025 1,325,745 2026 1,157,523 Thereafter 4,584,319 Total $ 10,349,821 |
Selected Account Information (T
Selected Account Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Selected Account Information Table [Abstract] | |
Schedule of receivables | September 30, December 31, Trade accounts receivable $ 5,110,116 $ 2,691,702 Vendor rebates receivable 139,322 126,118 Credit card payments in process of settlement - 116,187 Retainage 445,580 803,989 Total receivables 5,695,018 3,737,996 Allowance for doubtful accounts (359,000 ) (359,000 ) Total receivables, net $ 5,336,018 $ 3,378,996 |
Schedule of inventories | September 30, December 31, Appliances $ 2,146,254 $ 2,206,336 Automotive 1,248,947 2,064,834 Construction 1,749,250 1,543,980 Total inventories 5,144,451 5,815,150 Less reserve for obsolescence (387,848 ) (387,848 ) Total inventories, net $ 4,756,603 $ 5,427,302 |
Schedule of accounts payable and accrued expenses | September 30, December 31, Trade accounts payable $ 2,705,828 $ 3,117,825 Credit cards payable 130,013 52,300 Accrued payroll liabilities 630,846 263,590 Accrued interest 1,045,917 711,258 Accrued dividends 644,139 242,160 Other accrued liabilities 282,152 431,539 Total accounts payable and accrued expenses $ 5,438,895 $ 4,818,672 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Schedule of condensed consolidated balance sheet | September 30, December 31, Operating lease right-of-use assets $ 3,037,676 $ 3,192,604 Lease liabilities, current portion 707,419 613,696 Lease liabilities, long-term 2,419,449 2,607,862 Total operating lease liabilities $ 3,126,868 $ 3,221,558 Weighted-average remaining lease term (months) 49 59 Weighted average discount rate 4.37 % 4.29 % |
Schedule of maturities of operating lease liabilities | Year Ending December 31, Amount 2022 – remaining $ 239,421 2023 830,221 2024 848,210 2025 803,685 2026 514,079 Thereafter 194,495 Total 3,430,111 Less: imputed interest (303,243 ) Total operating lease liabilities $ 3,126,868 |
Schedule of maturities of finance lease liabilities | Year Ending December 31, Amount 2022 – remaining $ 58,482 2023 234,556 2024 218,099 2025 211,332 2026 211,332 Thereafter 238,875 Total payments 1,172,676 Less: amount representing interest (158,003 ) Present value of minimum finance lease payments $ 1,014,673 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Acquisitions Table [Abstract] | |
Schedule of unaudited pro forma results | Three Months Ended Nine Months Ended 2022 2021 2022 2021 Revenues $ 14,472,361 $ 15,328,672 $ 39,437,482 $ 39,091,277 Net income (loss) (4,472,622 ) 100,042 (5,547,498 ) 3,956,288 Net income (loss) attributable to common shareholders’ (13,440,062 ) (149,043 ) (14,801,040 ) 1,614,167 Earnings (loss) per share attributable to common shareholders’: Basic $ (4.51 ) $ (0.12 ) $ (8.08 ) $ 1.37 Diluted $ (4.51 ) $ (0.12 ) $ (8.08 ) $ 0.78 |
Shareholders_ Deficit (Tables)
Shareholders’ Deficit (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of changes in warrants outstanding | Warrants Weighted- Outstanding at December 31, 2021 1,300,122 $ 9.52 Granted (1) 1,978,432 5.25 Exercised (209,635 ) (5.58 ) Outstanding at September 30, 2022 3,068,919 $ 5.10 Exercisable at September 30, 2022 2,997,489 $ 5.10 (1) Includes the issuance of warrants for the purchase of 295,427 common shares and an increase of 1,683,005 common shares underlying warrants pursuant to the adjustments described above. |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of weighted average shares outstanding and the basic and diluted loss per common share attributable to common shareholders | Three Months Nine Months Net loss per common share attributable to common shareholders’ (13,440,062 ) $ (14,801,040 ) Weighted average common shares outstanding 2,979,949 1,832,076 Basic and diluted loss per share $ (4.51 ) $ (8.08 ) |
Liquidity and Going Concern A_2
Liquidity and Going Concern Assessment (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cash and cash equivalents | $ 1,584,499 | $ 1,383,533 |
Operating loss | 1,096,364 | |
Cash flows used in operations | 3,977,286 | |
Working capital | $ 1,839,424 |
Disaggregation of Revenues an_3
Disaggregation of Revenues and Segment Reporting (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Reportable segments | 3 |
Disaggregation of Revenues an_4
Disaggregation of Revenues and Segment Reporting (Details) - Schedule of revenues - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | $ 14,472,361 | $ 6,735,028 | $ 39,437,482 | $ 18,163,257 |
Appliances [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 2,492,544 | 2,745,305 | 7,206,386 | 8,587,939 |
Appliance accessories, parts, and other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 442,161 | 400,650 | 1,116,114 | 1,175,000 |
Automotive horns [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 1,094,636 | 1,694,928 | 3,766,415 | 3,326,835 |
Automotive lighting [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 395,074 | 555,717 | 1,348,340 | 904,178 |
Custom cabinets and countertops [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 2,990,767 | 1,338,428 | 10,288,711 | 4,169,305 |
Finished carpentry [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 7,057,179 | 15,711,516 | ||
Retail and Appliances [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 2,934,705 | 3,145,955 | 8,322,500 | 9,762,939 |
Retail and Appliances [Member] | Appliances [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 2,492,544 | 2,745,305 | 7,206,386 | 8,587,939 |
Retail and Appliances [Member] | Appliance accessories, parts, and other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 442,161 | 400,650 | 1,116,114 | 1,175,000 |
Retail and Appliances [Member] | Automotive horns [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Retail and Appliances [Member] | Automotive lighting [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Retail and Appliances [Member] | Custom cabinets and countertops [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Retail and Appliances [Member] | Finished carpentry [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Construction [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 10,047,946 | 1,338,428 | 26,000,227 | 4,169,305 |
Construction [Member] | Appliances [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Construction [Member] | Appliance accessories, parts, and other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Construction [Member] | Automotive horns [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Construction [Member] | Automotive lighting [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Construction [Member] | Custom cabinets and countertops [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 2,990,767 | 1,338,428 | 10,288,711 | 4,169,305 |
Construction [Member] | Finished carpentry [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 7,057,179 | 15,711,516 | ||
Automotive Supplies [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 1,489,710 | 2,250,645 | 5,114,755 | 4,231,013 |
Automotive Supplies [Member] | Appliances [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Automotive Supplies [Member] | Appliance accessories, parts, and other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Automotive Supplies [Member] | Automotive horns [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 1,094,636 | 1,694,928 | 3,766,415 | 3,326,835 |
Automotive Supplies [Member] | Automotive lighting [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 395,074 | 555,717 | 1,348,340 | 904,178 |
Automotive Supplies [Member] | Custom cabinets and countertops [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | ||||
Automotive Supplies [Member] | Finished carpentry [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues |
Disaggregation of Revenues an_5
Disaggregation of Revenues and Segment Reporting (Details) - Schedule of segment information - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 14,472,361 | $ 6,735,028 | $ 39,437,482 | $ 18,163,257 |
Operating expenses | ||||
Cost of sales | 9,596,387 | 4,573,123 | 25,109,863 | 12,348,594 |
Personnel | 3,182,286 | 876,992 | 6,446,145 | 2,198,231 |
Depreciation and amortization | 516,414 | 299,476 | 1,526,759 | 547,655 |
General and administrative | 2,688,877 | 1,844,979 | 7,451,079 | 4,519,504 |
Total Operating Expenses | 15,983,964 | 7,594,570 | 40,533,846 | 19,613,984 |
Income (loss) from Operations | (1,511,603) | (859,542) | (1,096,364) | (1,450,727) |
Retail and Appliances [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 2,934,705 | 3,145,955 | 8,322,500 | 9,762,939 |
Operating expenses | ||||
Cost of sales | 2,183,972 | 2,300,663 | 6,245,993 | 7,409,913 |
Personnel | 202,443 | 196,592 | 587,073 | 688,842 |
Depreciation and amortization | 48,019 | 47,104 | 175,835 | 135,782 |
General and administrative | 494,719 | 439,414 | 1,480,465 | 1,270,655 |
Total Operating Expenses | 2,929,153 | 2,983,774 | 8,489,366 | 9,505,192 |
Income (loss) from Operations | 5,552 | 162,182 | (166,866) | 257,747 |
Construction [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 10,047,946 | 1,338,428 | 26,000,227 | 4,169,305 |
Operating expenses | ||||
Cost of sales | 6,544,843 | 805,513 | 15,835,830 | 2,280,009 |
Personnel | 2,406,195 | 273,366 | 4,715,419 | 739,711 |
Depreciation and amortization | 416,525 | 83,112 | 1,195,314 | 242,613 |
General and administrative | 1,245,668 | 256,402 | 4,006,636 | 705,674 |
Total Operating Expenses | 10,613,231 | 1,418,393 | 25,753,199 | 3,968,007 |
Income (loss) from Operations | (565,285) | (79,965) | 247,028 | 201,298 |
Automotive Supplies [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 1,489,710 | 2,250,645 | 5,114,755 | 4,231,013 |
Operating expenses | ||||
Cost of sales | 867,572 | 1,466,947 | 3,028,040 | 2,658,672 |
Personnel | 277,398 | 407,034 | 847,403 | 769,678 |
Depreciation and amortization | 51,870 | 169,260 | 155,610 | 169,260 |
General and administrative | 384,870 | 673,484 | 1,188,618 | 1,570,070 |
Total Operating Expenses | 1,581,710 | 2,716,724 | 5,219,671 | 5,167,680 |
Income (loss) from Operations | (92,000) | (466,080) | (104,916) | (936,667) |
Corporate Services [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | ||||
Operating expenses | ||||
Cost of sales | ||||
Personnel | 296,250 | 296,250 | ||
Depreciation and amortization | ||||
General and administrative | 563,620 | 475,679 | 775,360 | 973,105 |
Total Operating Expenses | 859,870 | 475,679 | 1,071,610 | 973,105 |
Income (loss) from Operations | $ (859,870) | $ (475,679) | $ (1,071,610) | $ (973,105) |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 151,722 | $ 32,420 | $ 432,683 | $ 85,005 |
Property and Equipment (Detai_2
Property and Equipment (Details) - Schedule of property and equipment - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Property and Equipment [Abstract] | ||
Equipment and machinery | $ 1,401,103 | $ 808,592 |
Office furniture and equipment | 156,544 | 105,203 |
Transportation equipment | 911,426 | 864,121 |
Leasehold improvements | 169,143 | 112,356 |
Total property and equipment | 2,638,216 | 1,890,272 |
Less: Accumulated depreciation | (588,720) | (194,961) |
Property and equipment, net | $ 2,049,496 | $ 1,695,311 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Intangible Assets [Abstract] | ||||
Amortization expense | $ 364,692 | $ 267,057 | $ 1,094,076 | $ 462,651 |
Intangible Assets (Details) - S
Intangible Assets (Details) - Schedule of intangible assets - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Intangible Assets [Line Items] | ||
Total intangible assets | $ 12,331,000 | $ 12,331,000 |
Less: accumulated amortization | (1,981,179) | (887,103) |
Intangible assets, net | 10,349,821 | 11,443,897 |
Customer relationships [Member] | ||
Intangible Assets [Line Items] | ||
Total intangible assets | 5,791,000 | 5,791,000 |
Marketing-related [Member] | ||
Intangible Assets [Line Items] | ||
Total intangible assets | 5,917,000 | 5,917,000 |
Technology-related [Member] | ||
Intangible Assets [Line Items] | ||
Total intangible assets | $ 623,000 | $ 623,000 |
Intangible Assets (Details) -_2
Intangible Assets (Details) - Schedule of estimated amortization expense for intangible assets | Sep. 30, 2022 USD ($) |
Schedule of Estimated Amortization Expense For Intangible Assets [-Abstract] | |
2022 – remaining | $ 364,704 |
2023 | 1,458,780 |
2024 | 1,458,750 |
2025 | 1,325,745 |
2026 | 1,157,523 |
Thereafter | 4,584,319 |
Total | $ 10,349,821 |
Selected Account Information (D
Selected Account Information (Details) - Schedule of receivables - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Receivables [Abstract] | ||
Total receivables | $ 5,695,018 | $ 3,737,996 |
Allowance for doubtful accounts | (359,000) | (359,000) |
Total receivables, net | 5,336,018 | 3,378,996 |
Trade accounts receivable [Member] | ||
Schedule of Receivables [Abstract] | ||
Total receivables | 5,110,116 | 2,691,702 |
Vendor rebates receivable [Member] | ||
Schedule of Receivables [Abstract] | ||
Total receivables | 139,322 | 126,118 |
Credit card payments in process of settlement [Member] | ||
Schedule of Receivables [Abstract] | ||
Total receivables | 116,187 | |
Retainage [Member] | ||
Schedule of Receivables [Abstract] | ||
Total receivables | $ 445,580 | $ 803,989 |
Selected Account Information _2
Selected Account Information (Details) - Schedule of inventories - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory [Line Items] | ||
Total inventories | $ 5,144,451 | $ 5,815,150 |
Less reserve for obsolescence | (387,848) | (387,848) |
Total inventories, net | 4,756,603 | 5,427,302 |
Appliances [Member] | ||
Inventory [Line Items] | ||
Total inventories | 2,146,254 | 2,206,336 |
Automotive [Member] | ||
Inventory [Line Items] | ||
Total inventories | 1,248,947 | 2,064,834 |
Construction [Member] | ||
Inventory [Line Items] | ||
Total inventories | $ 1,749,250 | $ 1,543,980 |
Selected Account Information _3
Selected Account Information (Details) - Schedule of accounts payable and accrued expenses - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Accounts Payable And Accrued Expenses [Abstract] | ||
Trade accounts payable | $ 2,705,828 | $ 3,117,825 |
Credit cards payable | 130,013 | 52,300 |
Accrued payroll liabilities | 630,846 | 263,590 |
Accrued interest | 1,045,917 | 711,258 |
Accrued dividends | 644,139 | 242,160 |
Other accrued liabilities | 282,152 | 431,539 |
Total accounts payable and accrued expenses | $ 5,438,895 | $ 4,818,672 |
Leases (Details)
Leases (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jul. 13, 2022 | Apr. 11, 2022 | Mar. 28, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | |
Leases [Abstract] | |||||
Lease income | $ 7,518 | ||||
Operating lease expense | 254,713 | ||||
Rent expense | $ 278,823 | $ 804,544 | |||
Purchase of machinery and equipment | $ 240,260 | $ 11,706 | $ 316,798 | ||
Maturity date | June 2028 | June 2027 | January 2028 | ||
Weighted-average remaining lease term | 5 years 2 months 12 days | 5 years 2 months 12 days |
Leases (Details) - Schedule of
Leases (Details) - Schedule of condensed consolidated balance sheet - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Condensed Consolidated Balance Sheet [Abstract] | ||
Operating lease right-of-use assets | $ 3,037,676 | $ 3,192,604 |
Lease liabilities, current portion | 707,419 | 613,696 |
Lease liabilities, long-term | 2,419,449 | 2,607,862 |
Total operating lease liabilities | $ 3,126,868 | $ 3,221,558 |
Weighted-average remaining lease term (months) | 49 months | 59 months |
Weighted average discount rate | 4.37% | 4.29% |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of maturities of operating lease liabilities - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule of Maturities of Operating Lease Liabilities [Abstract] | ||
2022 – remaining | $ 239,421 | |
2023 | 830,221 | |
2024 | 848,210 | |
2025 | 803,685 | |
2026 | 514,079 | |
Thereafter | 194,495 | |
Total | 3,430,111 | |
Less: imputed interest | (303,243) | |
Total operating lease liabilities | $ 3,126,868 | $ 3,221,558 |
Leases (Details) - Schedule o_3
Leases (Details) - Schedule of maturities of finance lease liabilities | Dec. 31, 2021 USD ($) |
Schedule of Maturities of Finance Lease Liabilities [Abstract] | |
2022 – remaining | $ 58,482 |
2023 | 234,556 |
2024 | 218,099 |
2025 | 211,332 |
2026 | 211,332 |
Thereafter | 238,875 |
Total payments | 1,172,676 |
Less: amount representing interest | (158,003) |
Present value of minimum finance lease payments | $ 1,014,673 |
Acquisitions (Details)
Acquisitions (Details) - Business Combination [Member] - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 08, 2021 | Mar. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2022 | |
Wolo Industrial Horn & Signal, Inc. [Member] | ||||
Acquisitions (Details) [Line Items] | ||||
Outstanding capital stock percentage | 100% | |||
Aggregate purchase price | $ 8,344,056 | |||
Revenue | $ 1,489,710 | $ 5,114,755 | ||
Net loss from continuing operations | 393,493 | 1,034,427 | ||
High Mountain Door & Trim, Inc. [Member] | Sierra Homes, LLC [Member] | ||||
Acquisitions (Details) [Line Items] | ||||
Outstanding capital stock percentage | 100% | |||
Aggregate purchase price | $ 15,441,173 | |||
Revenue | 8,299,589 | 21,049,530 | ||
Net loss from continuing operations | $ 2,846,780 | $ 3,633,437 |
Acquisitions (Details) - Schedu
Acquisitions (Details) - Schedule of unaudited pro forma results - Business Combination [Member] - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Schedule of Unaudited Pro Forma Results [Abstract] | ||||
Revenues | $ 14,472,361 | $ 15,328,672 | $ 39,437,482 | $ 39,091,277 |
Net income (loss) | (4,472,622) | 100,042 | (5,547,498) | 3,956,288 |
Net income (loss) attributable to common shareholders’ | $ (13,440,062) | $ (149,043) | $ (14,801,040) | $ 1,614,167 |
Earnings (loss) per share attributable to common shareholders’: | ||||
Basic (in Dollars per share) | $ (4.51) | $ (0.12) | $ (8.08) | $ 1.37 |
Diluted (in Dollars per share) | $ (4.51) | $ (0.12) | $ (8.08) | $ 0.78 |
Related Parties (Details)
Related Parties (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Apr. 15, 2013 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Related Parties (Details) [Line Items] | ||||||
Management fee | $ 0 | $ 0 | $ 0 | $ 0 | ||
Total management fees | 275,000 | 225,000 | 825,000 | 600,000 | ||
Base rent | 7,000 | |||||
Increase in base rent | 7,210 | |||||
Total rent expense | 21,777 | 65,330 | ||||
37 Months [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Increase in base rent | 7,426 | |||||
Manager [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Advances from related parties | 74,928 | 74,928 | $ 74,928 | |||
Asiens [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Expensed management fees | 75,000 | 75,000 | 225,000 | 225,000 | ||
Cabinet [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Expensed management fees | 125,000 | 75,000 | 375,000 | 225,000 | ||
Wolo [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Total management fees | 75,000 | $ 75,000 | 225,000 | $ 150,000 | ||
Advances [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Advances from related parties | $ 118,834 | $ 118,834 | $ 118,834 | |||
Management Services Agreement [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Description of management fee | On April 15, 2013, the Company and 1847 Partners LLC (the “Manager”) entered into a management services agreement, pursuant to which the Company is required to pay the Manager a quarterly management fee equal to 0.5% of its adjusted net assets for services performed (the “Parent Management Fee”). | |||||
Repayment, description | The amount of the Parent Management Fee with respect to any fiscal quarter is (i) reduced by the aggregate amount of any management fees received by the Manager under any offsetting management services agreements with respect to such fiscal quarter, (ii) reduced (or increased) by the amount of any over-paid (or under-paid) Parent Management Fees received by (or owed to) the Manager as of the end of such fiscal quarter, and (iii) increased by the amount of any outstanding accrued and unpaid Parent Management Fees. | |||||
Offsetting Management Services Agreements [Member] | ||||||
Related Parties (Details) [Line Items] | ||||||
Additional advances, description | Pursuant to the offsetting management services agreements, 1847 Asien appointed the Manager to provide certain services to it for a quarterly management fee equal to the greater of $75,000 or 2% of adjusted net assets (as defined in the management services agreement), 1847 Cabinet appointed the Manager to provide certain services to it for a quarterly management fee equal to the greater of $75,000 or 2% of adjusted net assets (as defined in the management services agreement), which was increased to $125,000 or 2% of adjusted net assets on October 8, 2021, and 1847 Wolo appointed the Manager to provide certain services to it for a quarterly management fee equal to the greater of $75,000 or 2% of adjusted net assets (as defined in the management services agreement); provided, however, in each case that if the aggregate amount of management fees paid or to be paid by such entities, together with all other management fees paid or to be paid to the Manager under other offsetting management services agreements, exceeds, or is expected to exceed, 9.5% of our gross income in any fiscal year or the Parent Management Fee in any fiscal quarter, then the management fee to be paid by such entities shall be reduced, on a pro rata basis determined by reference to the other management fees to be paid to the Manager under other offsetting management services agreements. |
Mezzanine Equity (Details)
Mezzanine Equity (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||
Aug. 26, 2022 | Aug. 12, 2022 | Jul. 08, 2022 | Feb. 16, 2022 | Oct. 12, 2021 | May 19, 2022 | Mar. 24, 2022 | Sep. 29, 2021 | Mar. 26, 2021 | Nov. 20, 2020 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Feb. 17, 2022 | Dec. 31, 2021 | |
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Senior convertible preferred shares (in Shares) | 4,450,460 | 4,450,460 | 4,450,460 | ||||||||||||
Dividends rate (in Dollars per share) | $ 2 | $ 2 | |||||||||||||
Common shares calculated based percentage | 80% | ||||||||||||||
Calculated based fixed price per share (in Dollars per share) | $ 1.57 | ||||||||||||||
Dividend payment date per share (in Dollars per share) | 1.57 | ||||||||||||||
Common shares stated value per share (in Dollars per share) | 2 | ||||||||||||||
Conversion price (in Dollars per share) | $ 7 | $ 7 | |||||||||||||
Common shares outstanding percentage | 4.99% | ||||||||||||||
Ownership common shares outstanding | 9.99% | ||||||||||||||
Consolidations adjustments to conversion price, description | ●On the first day of the 12th month following the issuance date of any series A senior convertible preferred shares, the stated dividend rate shall automatically increase by five percent (5.0%) per annum and the conversion price shall automatically adjust to the lower of the (i) initial conversion price and (ii) the price equal to the lowest VWAP of the ten (10) trading days immediately preceding such date. ●On the first day of the 24th month following the issuance date of any series A senior convertible preferred shares, the stated dividend rate shall automatically increase by an additional five percent (5.0%) per annum, the stated value shall automatically increase by ten percent (10%) and the conversion price shall automatically adjust to the lower of the (i) initial conversion price and (ii) the price equal to the lowest VWAP of the ten (10) trading days immediately preceding such date. ●On the first day of the 36th month following the issuance date of any series A senior convertible preferred shares, the stated dividend rate shall automatically increase by an additional five percent (5.0%) per annum, the stated value shall automatically increase by ten percent (10%) and the conversion price shall automatically adjust to the lower of the (i) initial conversion price and (ii) the price equal to the lowest VWAP of the ten (10) trading days immediately preceding the third adjustment date. | ||||||||||||||
Additional equity interest | 10% | ||||||||||||||
Accrued dividends | $ 174,701 | $ 462,925 | |||||||||||||
Total redemption price | $ 209,091 | ||||||||||||||
Common shares fixed price (in Dollars per share) | $ 7.23 | ||||||||||||||
Conversion price per share price adjustment (in Dollars per share) | $ 0.03 | ||||||||||||||
Aggregate units issued (in Shares) | 54,567 | 426,999 | |||||||||||||
Aggregate units price per share (in Dollars per share) | $ 3 | ||||||||||||||
Gross proceeds | $ 163,700 | $ 1,281,000 | $ 5,148,700 | ||||||||||||
Issuance costs | 15,000 | 15,000 | |||||||||||||
Net proceeds | 1,429,700 | ||||||||||||||
Fair value of warrants | 172,050 | 172,050 | |||||||||||||
Convertible preferred shares amount | $ 50,309 | $ 113,052 | |||||||||||||
Paid prior period accrued dividends | $48,197 | $77,548 | |||||||||||||
Reclassification of shares from mezzanine equity to permanent equity | $ 2,672,750 | ||||||||||||||
Common Shares [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Exercise price per share (in Dollars per share) | $ 3 | $ 3 | |||||||||||||
Reclassification of shares from mezzanine equity to permanent equity | |||||||||||||||
Series A Senior Convertible Preferred Shares [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Senior convertible preferred shares (in Shares) | 2,632,278 | ||||||||||||||
Dividend rate, Percentage | 14% | ||||||||||||||
Accumulated accrued and unpaid dividends percentage | 115% | ||||||||||||||
Convertible preferred shares percentage | 115% | ||||||||||||||
Redemption price, including dividends | $ 6,395,645 | ||||||||||||||
Preferred shares issued (in Shares) | 1,593,940 | 1,593,940 | 1,818,182 | ||||||||||||
Preferred shares outstanding (in Shares) | 1,593,940 | 1,593,940 | 1,818,182 | ||||||||||||
Convertible preferred shares amount | $ 156,738 | ||||||||||||||
Accrued dividends | $ 437,491 | ||||||||||||||
Convertible preferred shares (in Shares) | 133,333 | ||||||||||||||
Convertible dividends (in Shares) | 38,096 | ||||||||||||||
Net proceeds | 1,429,700 | ||||||||||||||
Series A Senior Convertible Preferred Shares [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Preferred shares issued (in Shares) | 90,909 | ||||||||||||||
Reclassification of shares from mezzanine equity to permanent equity | $ 1,684,849 | ||||||||||||||
Preferred Class B [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Shares issued (in Shares) | 583,334 | ||||||||||||||
Series B Senior Convertible Preferred Shares [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Convertible preferred shares percentage | 14% | ||||||||||||||
Preferred shares outstanding (in Shares) | 0 | ||||||||||||||
Preferred shares issued (in Shares) | 16,667 | 464,899 | 464,899 | ||||||||||||
Total redemption price | $ 57,501 | ||||||||||||||
Convertible preferred shares amount | $ 1,818,182 | ||||||||||||||
Reclassification of shares from mezzanine equity to permanent equity | $ 481,566 | ||||||||||||||
Series B Preferred Stock [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Common shares outstanding percentage | 4.99% | ||||||||||||||
Ownership common shares outstanding | 9.99% | ||||||||||||||
Preferred shares issued (in Shares) | 464,899 | 464,899 | 0 | ||||||||||||
Preferred shares outstanding (in Shares) | 464,899 | 464,899 | 0 | ||||||||||||
Subject to adjustment percentage | 3% | ||||||||||||||
Common shares fixed price (in Dollars per share) | $ 2.7 | ||||||||||||||
Fair value of shares | $ 1,257,650 | ||||||||||||||
Liquidation Rights [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Convertible preferred shares percentage | 115% | ||||||||||||||
Conversion Rights [Member] | Series B Preferred Stock [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Common shares stated value per share (in Dollars per share) | $ 3 | ||||||||||||||
Conversion price (in Dollars per share) | $ 12 | $ 12 | |||||||||||||
Redemption Rights [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Convertible preferred shares percentage | 115% | ||||||||||||||
VWAP [Member] | Preferred Class B [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Dividend rate, Percentage | 80% | ||||||||||||||
VWAP [Member] | Series B Preferred Stock [Member] | |||||||||||||||
Mezzanine Equity (Details) [Line Items] | |||||||||||||||
Common shares fixed price (in Dollars per share) | $ 2.7 |
Shareholders_ Deficit (Details)
Shareholders’ Deficit (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||
Aug. 23, 2022 | Aug. 05, 2022 | Aug. 02, 2022 | Jul. 29, 2022 | Jul. 08, 2022 | Mar. 23, 2022 | Feb. 16, 2022 | Oct. 08, 2021 | Sep. 30, 2022 | Jul. 26, 2022 | Sep. 15, 2022 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | 500,000,000 | ||||||||||||
Common stock, shares issued | 4,079,137 | 4,079,137 | 1,210,918 | ||||||||||||
Common stock, shares outstanding | 4,079,137 | 4,079,137 | 1,210,918 | ||||||||||||
Gross proceeds (in Dollars) | $ 6,000,000 | ||||||||||||||
Net proceeds (in Dollars) | $ 5,150,000 | ||||||||||||||
Aggregate principal amount (in Dollars) | $ 600,000 | ||||||||||||||
Dividend per share (in Dollars per share) | $ 0.13125 | $ 0.13125 | $ 0.05 | ||||||||||||
Common stock dividend (in Dollars) | $ 505,751 | $ 337,841 | $ 249,762 | ||||||||||||
Aggregate gross proceeds description | As described in Note 11, the Company issued units during the nine months ended September 30, 2022, with each unit consisting of one (1) series B senior convertible preferred share and a three-year warrant to purchase one (1) common share at an exercise price of $12.00 per common share (subject to adjustment), which such exercise price was adjusted to $4.20 following the adjustments described below. Accordingly, a portion of the proceeds were allocated to the warrant based on its relative fair value using the Geometric Brownian Motion Stock Path Monte Carlo Simulation. The assumptions used in the model were as follows: (i) dividend yield of 0%; (ii) expected volatility of 51.81%; (iii) weighted average risk-free interest rate of 0.31%; (iv) expected life of three years; (v) estimated fair value of the common shares of $7.76 per share; and (vi) various probability assumptions related to redemption, calls and price resets. The fair value of the warrants was $428,034, or $0.89 per warrant, resulting in the amount allocated to the warrants, based on their relative fair of $172,050, which was recorded as additional paid-in capital. | ||||||||||||||
Warrants description | The warrants allow the holder to purchase one (1) common share at an exercise price of $12.00 per common share (subject to adjustment including upon any future equity offering with a lower exercise price), which may be exercised on a cashless basis under certain circumstances. The Company may force the exercise of the warrants at any time after the one year anniversary of the date of the warrants, if (i) the Company is listed on a national securities exchange or the over-the-counter market, (ii) the underlying common shares are registered or the holder of the warrant otherwise has the ability to trade the underlying common shares without restriction, (iii) the 30-day volume-weighted daily average price of the common shares exceeds 200% of the exercise price, as adjusted, and (iv) the average daily trading volume is at least 100,000 common shares during such 30-day period. The Company may redeem the warrants held by any holder in whole (but not in part) by paying in cash to such holder as follows: (i) $0.50 per share then underlying the warrant if within the first twelve (12) months of issuance; (ii) $1.00 per share then underlying the warrant if after the first twelve (12) months, but before twenty-four (24) months of issuance; and (iii) $1.50 per share then underlying the warrant if after twenty-four months, but before thirty-six (36) months. | ||||||||||||||
Purchase of common shares | 35,715 | 100,000 | 209,635 | 295,427 | |||||||||||
Exercise price per share (in Dollars per share) | $ 5.25 | $ 6 | |||||||||||||
Adjusted exercise price (in Dollars per share) | $ 4.2 | ||||||||||||||
Total net proceeds (in Dollars) | $ 499,600 | ||||||||||||||
Dividend yield | 0% | ||||||||||||||
Expected volatility rate | 49.11% | ||||||||||||||
Weighted average risk-free interest rate | 3.13% | ||||||||||||||
Expected term | 5 years | ||||||||||||||
Common share, per share (in Dollars per share) | $ 7.23 | ||||||||||||||
Fair value of warrants (in Dollars) | $ 2,405,306 | $ 757,792 | |||||||||||||
Warrants price per share (in Dollars per share) | $ 6.01 | ||||||||||||||
Additional paid-in capital (in Dollars) | $ 402,650 | ||||||||||||||
Exercise price (in Dollars per share) | $ 5.2 | ||||||||||||||
Dividend income (in Dollars) | $ 6,400,000 | ||||||||||||||
Issuance of common shares | 1,683,005 | 126,669 | 1,683,005 | ||||||||||||
Deemed dividend (in Dollars) | $ 2,600,000 | ||||||||||||||
Weighted average remaining contractual life | 1 year 8 months 4 days | ||||||||||||||
Intrinsic value (in Dollars) | $ 98,125 | ||||||||||||||
Common Stock [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Shares issued | 126,669 | ||||||||||||||
Agrred to sale of common shares | 99,710 | ||||||||||||||
Maximum [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Outstanding warrants (in Dollars per share) | $ 4.2 | ||||||||||||||
Minimum [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Outstanding warrants (in Dollars per share) | $ 4.2 | ||||||||||||||
Underwriting Agreement [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Agrred to sale of common shares | 1,428,572 | ||||||||||||||
Offering public price per share (in Dollars per share) | $ 4.2 | $ 4.2 | |||||||||||||
Sale of common shares | 1,428,572 | ||||||||||||||
Series A Preferred Stock [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Shares issued | 38,096 | ||||||||||||||
Convertible preferred shares | 133,333 | ||||||||||||||
J.H. Darbie & Co [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Purchase of common shares | 3,600 | ||||||||||||||
Exercise price per share (in Dollars per share) | $ 7.5 | ||||||||||||||
Adjusted exercise price (in Dollars per share) | 4.2 | ||||||||||||||
Mast Hill Fund, L.P. [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Adjusted exercise price (in Dollars per share) | $ 5.2 | ||||||||||||||
Steven J. Parkey [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Offering public price per share (in Dollars per share) | $ 4.2 | ||||||||||||||
Promissory principal percentage | 6% | ||||||||||||||
Aggregate principal amount (in Dollars) | $ 5,880,345 | ||||||||||||||
Convertible notes (in Dollars) | $ 3,360,000 | ||||||||||||||
Conversion shares issued | 800,000 | ||||||||||||||
Extinguishment of debt (in Dollars) | $ 1,280,000 | ||||||||||||||
Steven J. Parkey [Member] | Promissory Note [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Agrred to sale of common shares | 800,000 | ||||||||||||||
Stephen Mallatt, Jr.[Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Common stock, shares issued | 189,815 | ||||||||||||||
Offering public price per share (in Dollars per share) | $ 4.2 | ||||||||||||||
Promissory principal percentage | 8% | ||||||||||||||
Aggregate principal amount (in Dollars) | $ 1,260,000 | ||||||||||||||
Convertible notes (in Dollars) | $ 797,221 | ||||||||||||||
Conversion shares issued | 189,815 | ||||||||||||||
Extinguishment of debt (in Dollars) | $ 303,706 | ||||||||||||||
Bevilacqua PLLC [Member] | |||||||||||||||
Shareholders’ Deficit (Details) [Line Items] | |||||||||||||||
Common stock, shares issued | 285,067 | ||||||||||||||
Offering public price per share (in Dollars per share) | $ 4.2 | ||||||||||||||
Convertible notes (in Dollars) | $ 1,197,280 | ||||||||||||||
Conversion shares issued | 285,067 | ||||||||||||||
Extinguishment of debt (in Dollars) | $ 456,109 |
Shareholders_ Deficit (Detail_2
Shareholders’ Deficit (Details) - Schedule of changes in warrants outstanding - $ / shares | 9 Months Ended | |
Sep. 30, 2022 | ||
Schedule Of Changes In Warrants Outstanding Abstract | ||
Warrants, Outstanding at beginning balance | 1,300,122 | |
Weighted- Average Exercise Price, Outstanding at beginning balance | $ 9.52 | |
Warrants, Granted | [1] | 1,978,432 |
Weighted- Average Exercise Price, Granted | [1] | $ 5.25 |
Warrants, Exercised | (209,635) | |
Weighted- Average Exercise Price, Exercised | $ (5.58) | |
Warrants, Outstanding at ending balance | 3,068,919 | |
Weighted- Average Exercise Price, Outstanding at ending balance | $ 5.1 | |
Warrants, Exercisable | 2,997,489 | |
Weighted- Average Exercise Price, Exercisable | $ 5.1 | |
[1]Includes the issuance of warrants for the purchase of 295,427 common shares and an increase of 1,683,005 common shares underlying warrants pursuant to the adjustments described above. |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Effect of anti-dilutive shares | 6,462,938 | 547,459 | 6,462,938 | 547,459 |
Earnings (Loss) Per Share (De_2
Earnings (Loss) Per Share (Details) - Schedule of weighted average shares outstanding and the basic and diluted loss per common share attributable to common shareholders - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Schedule of Weighted Average Shares Outstanding And The Basic And Diluted Loss Per Common Share Attributable To Common Shareholders[ Abstract] | ||||
Net loss per common share attributable to common shareholders’ | $ (13,440,062) | $ (14,801,040) | ||
Weighted average common shares outstanding | 2,979,949 | 1,210,918 | 1,832,076 | 2,065,215 |
Basic and diluted loss per share | $ (4.51) | $ (1.01) | $ (8.08) | $ (0.8) |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] | 1 Months Ended |
Oct. 20, 2022 USD ($) | |
Subsequent Events (Details) [Line Items] | |
Convertible promissory note percentage | 6% |
Aggregate principal amount | $ 1,037,500 |
Maturity date | Feb. 28, 2023 |
Amendment fee | $ 87,707 |