Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 26, 2021 | Jun. 30, 2020 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | GrowGeneration Corp. | ||
Entity Central Index Key | 0001604868 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 236,600,250 | ||
Entity Filer Number | 333-207889 | ||
Entity Incorporation State Country Code | CO | ||
Entity Interactive Data Current | Yes | ||
Entity Common Stock, Shares Outstanding | 58,459,742 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 177,911,511 | $ 12,979,444 |
Accounts receivable, net of allowance for doubtful accounts of $192,193 and $291,372 at December 31, 2020 and 2019 | 3,900,519 | 2,953,921 |
Notes receivable, current, net of allowance for doubtful accounts of $292,050 and $0 at December 31, 2020 and 2019 | 2,612,134 | 1,037,541 |
Inventory | 54,024,491 | 21,576,609 |
Income tax receivable | 655,253 | |
Prepaids and other current assets | 11,124,752 | 2,549,559 |
Total current assets | 250,228,660 | 41,097,074 |
Property and equipment, net | 6,475,130 | 3,340,616 |
Operating leases right-of-use assets, net | 12,088,390 | 7,628,591 |
Notes receivables, net of current portion | 1,199,743 | 463,747 |
Intangible assets, net | 21,489,544 | 233,280 |
Goodwill | 62,951,461 | 17,798,932 |
Other assets | 300,767 | 377,364 |
TOTAL ASSETS | 354,733,695 | 70,939,604 |
Current liabilities: | ||
Accounts payable | 14,623,107 | 6,024,750 |
Accrued liabilities | 672,103 | |
Payroll and payroll tax liabilities | 2,655,427 | 1,072,142 |
Customer deposits | 5,154,524 | 2,503,785 |
Sales tax payable | 1,160,752 | 533,656 |
Current maturities of lease liability | 3,000,684 | 1,836,700 |
Current portion of long-term debt | 82,877 | 110,231 |
Total current liabilities | 27,349,474 | 12,081,264 |
Deferred tax liability | 750,430 | |
Operating lease liability, net of current maturities | 9,478,553 | 5,807,266 |
Long-term debt, net of current portion | 157,987 | 242,079 |
Total liabilities | 37,736,444 | 18,130,609 |
Commitments and contingencies | ||
Stockholders' Equity: | ||
Common stock; $.001 par value; 100,000,000 shares authorized; 57,150,998 and 36,876,305 shares issued and outstanding as of December 31, 2020 and 2019, respectively | 57,152 | 36,876 |
Additional paid-in capital | 319,581,657 | 60,742,055 |
Accumulated deficit | (2,641,558) | (7,969,936) |
Total stockholders' equity | 316,997,251 | 52,808,995 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 354,733,695 | $ 70,939,604 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowance for doubtful accounts | $ 192,193 | $ 291,372 |
Notes receivable current, net of allowance for doubtful accounts | $ 292,050 | $ 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 57,150,998 | 36,876,305 |
Common stock, shares outstanding | 57,150,998 | 36,876,305 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||
Sales | $ 193,365,479 | $ 79,733,568 |
Cost of sales | 142,317,178 | 57,728,683 |
Gross profit | 51,048,301 | 22,004,885 |
Operating expenses: | ||
Store operations | 18,723,794 | 10,095,422 |
General and administrative | 5,009,710 | 3,172,019 |
Share based compensation | 7,856,163 | 2,490,535 |
Depreciation and amortization | 2,435,965 | 1,044,553 |
Salaries and related expenses | 8,585,080 | 3,619,197 |
Total operating expenses | 42,610,712 | 20,421,726 |
Net income from operations | 8,437,589 | 1,583,159 |
Other income (expense): | ||
Miscellaneous income (expense) | 111,807 | (4,545) |
Interest income | 43,926 | 144,725 |
Interest expense | (14,053) | (401,497) |
Total non-operating income (expense), net | 141,680 | (261,317) |
Net income before taxes | 8,579,269 | 1,321,842 |
Provision for income taxes | (3,250,891) | |
Net income | $ 5,328,378 | $ 1,321,842 |
Net income per share, basic | $ 0.12 | $ 0.04 |
Net income per share, diluted | $ 0.11 | $ 0.04 |
Weighted average shares outstanding, basic | 43,944,879 | 32,833,594 |
Weighted average shares outstanding, diluted | 46,456,249 | 33,910,154 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated (Deficit) | Total |
Balance at Dec. 31, 2018 | $ 27,949 | $ 38,796,562 | $ (9,291,778) | $ 29,523,733 |
Balance, shares at Dec. 31, 2018 | 27,948,609 | |||
Sale of Common stock and warrants, net of fees | $ 4,123 | 12,639,510 | 12,643,633 | |
Sale of Common stock and warrants, net of fees, shares | 4,123,254 | |||
Share based compensation | 1,215,273 | 1,215,273 | ||
Common stock issued upon warrant exercise | $ 1,758 | 1,298,141 | 1,299,899 | |
Common stock issued upon warrant exercise, shares | 1,757,913 | |||
Common stock issued upon exercise of options | $ 10 | 5,990 | 6,000 | |
Common stock issued upon exercise of options, shares | 10,000 | |||
Common stock issued upon cashless exercise of options | $ 506 | (506) | ||
Common stock issued upon cashless exercise of options, shares | 505,868 | |||
Common stock issued in connection with business combinations | $ 969 | 3,624,411 | 3,625,380 | |
Common stock issued in connection with business combinations, shares | 969,553 | |||
Common stock issued upon conversion of convertible debt | $ 1,259 | 2,404,010 | 2,405,269 | |
Common stock issued upon conversion of convertible debt, shares | 1,258,608 | |||
Common stock issued for services | $ 202 | 548,564 | 548,766 | |
Common stock issued for services, shares | 202,500 | |||
Common stock issued for accrued share-based compensation | $ 100 | 210,100 | 210,200 | |
Common stock issued for accrued share-based compensation, shares | 100,000 | |||
Net income | 1,321,842 | 1,321,842 | ||
Balance at Dec. 31, 2019 | $ 36,876 | 60,742,055 | (7,969,936) | 52,808,995 |
Balance, shares at Dec. 31, 2019 | 36,876,305 | |||
Sale of common stock, net of fees | $ 14,375 | 207,120,290 | 207,134,665 | |
Sale of common stock, net of fees, shares | 14,375,000 | |||
Common stock issued upon warrant exercise | $ 1,370 | 3,840,401 | 3,841,771 | |
Common stock issued upon warrant exercise, shares | 1,369,754 | |||
Common stock issued upon cashless exercise of warrants | $ 918 | (918) | ||
Common stock issued upon cashless exercise of warrants, shares | 918,186 | |||
Common stock issued upon exercise of options | $ 71 | 229,783 | 229,854 | |
Common stock issued upon exercise of options, shares | 70,562 | |||
Common stock issued upon cashless exercise of options | $ 694 | (694) | ||
Common stock issued upon cashless exercise of options, shares | 694,281 | |||
Common stock issued in connection with business combinations | $ 1,731 | 39,144,315 | 39,146,046 | |
Common stock issued in connection with business combinations, shares | 1,730,431 | |||
Common stock issued for assets | $ 20 | 136,180 | 136,200 | |
Common stock issued for assets, shares | 20,000 | |||
Common stock issued for services | $ 50 | (50) | ||
Common stock issued for services, shares | 50,000 | |||
Common stock issued for accrued payroll | $ 325 | 717,206 | 717,531 | |
Common stock issued for accrued payroll, shares | 324,674 | |||
Common stock issued for accrued share-based compensation | $ 722 | 3,796,901 | 3,797,623 | |
Common stock issued for accrued share-based compensation, shares | 729,325 | |||
Common stock redemption | $ (7,520) | (118,785) | (118,785) | |
Share based compensation | 3,974,973 | 3,974,973 | ||
Net income | 5,328,378 | 5,328,378 | ||
Balance at Dec. 31, 2020 | $ 57,152 | $ 319,581,657 | $ (2,641,558) | $ 316,997,251 |
Balance, shares at Dec. 31, 2020 | 57,150,998 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income | $ 5,328,378 | $ 1,321,842 |
Adjustments to reconcile net income to net cash used in operating Activities: | ||
Depreciation and amortization | 2,435,965 | 1,044,553 |
Provision for doubtful accounts and notes receivable | 213,503 | 172,135 |
Inventory valuation reserve | 4,390 | 429,126 |
Amortization of debt discount | 356,306 | |
Stock based compensation | 7,856,163 | 2,490,535 |
Deferred income taxes | 750,430 | |
Other | (126,694) | (66,536) |
(Increase) decrease in: | ||
Accounts and notes receivable | (3,470,690) | (3,764,947) |
Inventory | (19,192,401) | (9,925,052) |
Prepaid expenses and other assets | (9,237,416) | (2,061,701) |
Increase (decrease) in: | ||
Accounts payable and accrued liabilities | 9,987,990 | 4,165,188 |
Operating leases | 375,472 | 15,375 |
Customer deposits | 2,650,739 | 1,987,747 |
Payroll and payroll tax liabilities | 1,583,285 | 154,471 |
Sales taxes payable | 627,096 | 341,698 |
Net Cash and Cash Equivalents (Used In) Operating Activities | (213,790) | (3,339,260) |
Cash Flows from Investing Activities: | ||
Assets acquired in business combinations | (41,400,900) | (9,458,743) |
Purchase of property and equipment | (3,401,755) | (2,232,812) |
Purchase of intangibles | (1,027,548) | (119,125) |
Net Cash and Cash Equivalents (Used In) Investing Activities | (45,830,203) | (11,810,680) |
Cash Flows from Financing Activities: | ||
Principal payments on long term debt | (111,445) | (460,129) |
Stock redemptions | (118,785) | |
Proceeds from the sales of common stock and exercise of warrants and options, net of expenses | 211,206,290 | 13,949,532 |
Net Cash and Cash Equivalents Provided by Financing Activities | 210,976,060 | 13,489,403 |
Net Increase(decrease) in Cash and Cash Equivalents | 164,932,067 | (1,660,537) |
Cash and Cash Equivalents at Beginning of year | 12,979,444 | 14,639,981 |
Cash and Cash Equivalents at End of year | 177,911,511 | 12,979,444 |
Supplemental Information: | ||
Common stock and warrants issued for prepaid services | 96,000 | |
Common stock issued for accrued payroll liability | 717,531 | 210,200 |
Debt converted to equity | 2,310,832 | |
Assets acquired by issuance of stock | 39,282,246 | 3,625,380 |
Cash paid for interest | 14,053 | 45,191 |
Right to use assets acquired under new operating leases | $ 7,887,344 | $ 6,210,395 |
Nature of Operations
Nature of Operations | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS | 1. NATURE OF OPERATIONS GrowGeneration Corp (the "Company") was incorporated on March 6, 2014 in Colorado under the name of Easylife Corp and changed its name to GrowGeneration Corp. It maintains its principal office in Denver, Colorado. GrowGeneration is the largest chain of hydroponic garden centers in North America and is a leading marketer and distributor of nutrients, growing media, advanced indoor and greenhouse lighting, ventilation systems and accessories for hydroponic gardening. Currently, the Company owns and operates a chain of fifty two (52) retail hydroponic/gardening stores across 12 states, with eighteen (18) in the state of California, six (6) in the state of Michigan, eight (8) located in the state of Colorado, five (5) in the State of Oklahoma, five (5) in Maine, two (2) in the state of Nevada, two (2) in the state of Washington, two (2) in the state of Oregon, one (1) in the state of Rhode Island, one (1) in the state of Florida, one (1) in the state of Massachusetts, one (1) in the state of Arizona, an online e-commerce store, GrowGeneration.com and a commercial e-commerce platform, Agron.io The Company's plan is to continue to acquire, open and operate hydroponic/gardening stores and related businesses throughout the United States and Canada. The Company engages in its business through its wholly-owned subsidiaries, GrowGeneration Pueblo Corp, GrowGeneration California Corp, GrowGeneration Nevada Corp, GrowGeneration Washington Corp, GrowGeneration Rhode Island Corp, GrowGeneration Oklahoma Corp, GrowGeneration Canada, GrowGeneration HG Corp, GrowGeneration Hemp Corp, GGen Distribution Corp, GrowGeneration Michigan Corp, GrowGeneration New England Corp, GrowGeneration Florida Corp and GrowGeneration Management Corp. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Consolidation The financial statements are prepared under the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 105-10, Generally Accepted Accounting Principles The consolidated financial statements include the Company and its wholly-owned subsidiaries. All intercompany balances and transactions are eliminated in consolidation. Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income. Use of Estimates Management uses estimates and assumptions in preparing these consolidated financial statements in accordance with generally accepted accounting principles. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported revenues and expenses during the reporting period. Actual results could vary from the estimates that were used. Use of Estimates, continued Additionally, the full impact of COVID-19 is unknown and cannot be reasonably estimated. However, we have made appropriate accounting estimates based on the facts and circumstances available as of the reporting date. To the extent there are differences between these estimates and actual results, our consolidated financial statements may be materially affected. As we continue to monitor the COVID-19 situation, the Company is considered an "essential" supplier to the agricultural industry, suppling the nutrients and nourishment required to feed their plants. The Company has remained open during this difficult time. We have plans and procedures in place to ensure our customers and employees stay safe during this time of uncertainty. As a result of COVID-19 we reduced some hours of operations at the store level and some stores were closed on the weekends, primarily in the later part of the first quarter of 2020. There have been some minor delays in vendor shipments as their warehouses and supply chain were affected by staffing shortages. The Company successfully implemented a will call and curb side pick-up process that is working well. Other than what has been disclosed above, we have not experienced adverse effects from COVID-19. Segment Reporting Management makes significant operating decisions based upon the analysis of the entire Company and financial performance is evaluated on a company-wide basis. Accordingly, the various products sold are aggregated into one reportable operating segment as under guidance in the Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC or codification") Topic 280 for segment reporting. Revenue Recognition The Company recognizes revenue, net of estimated returns and sales tax, at the time the customer takes possession of merchandise or receives services at which point, the performance obligation is satisfied. Sales and other taxes collected concurrent with revenue producing activities are excluded from revenue. In the normal course of business, the Company does not accept product returns unless the item is defective as manufactured. The Company monitors provisions for estimated returns. Payment for goods and services sold by the Company is typically due upon satisfaction of the performance obligations. Under certain circumstances, the Company does provide goods and services to customers on a credit basis (see Accounts Receivable, Notes Receivable and Concentration of Credit Risk Vendor Allowances Vendor allowances primarily consist of volume rebates that are earned as a result of attaining certain purchase levels. These vendor allowances are accrued as earned, with those allowances received as a result of attaining certain purchase levels accrued over the incentive period based on estimates of purchases. Volume rebates, when earned, are recorded as a reduction in cost of sales or cost of inventory. Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company's cash equivalents are carried at fair market value and consist primarily of money market funds. Financial instruments that potentially expose us to concentrations of risk consist primarily of cash and cash equivalents and accounts receivable, which are generally not collateralized. Our policy is to place our cash and cash equivalents with high quality financial institutions, in order to limit the amount of credit exposure. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (FDIC), up to $250,000. At December 31, 2020 and 2019, the Company had approximately $174 million and $11 million, respectively, in excess of the FDIC insurance limit. Accounts Receivable, Notes Receivable and Concentration of Credit Risk Accounts receivable are stated at the amount the Company expects to collect from balances outstanding at period-end, based on the Company's assessment of the credit history with customers having outstanding balances and current relationships with them. A reserve for uncollectable receivables is established when collection of amounts due is deemed improbable. Indicators of improbable collection include client bankruptcy, client litigation, client cash flow difficulties or ongoing service or billing disputes. Credit is generally extended on a short-term basis thus receivables do not bear interest. Interest on past due balances are subject to an interest charge of 1.5% per month. At December 31, 2020 and 2019, the Company established an allowance for doubtful accounts of $192,193 and $291,372, respectively. Notes receivable are stated at the amount the Company expects to collect from balances outstanding at period-end, based on the Company's assessment of the credit history with customers having outstanding balances and current relationships with them. A reserve for uncollectable receivables is established when collection of amounts due is deemed improbable. Indicators of improbable collection include client bankruptcy, client litigation, client cash flow difficulties or ongoing service or billing disputes. A note is placed on non-accrual status when management determines, after considering economic and business conditions and collection efforts, that the note is impaired or collection of interest is doubtful. The accrual of interest on the instrument ceases when there is concern that principal or interest due according to the note agreement will not be collected. Any payment received on such non-accrual notes are recorded as interest income when the payment is received. The note is reclassified as accrual-basis once interest and principal payments become current. The Company periodically reviews the value of the underlying collateral for the note receivable and evaluates whether the value of the collateral continues to provide adequate security for the note. Should the value of the underlying collateral become less than the outstanding principal and interest, the Company will determine whether an allowance is necessary. Any uncollectible interest previously accrued is also charged off. As of December 31, 2020, the Company believes the value of the underlying collateral for each of the notes to be sufficient and in excess of the respective outstanding principal and accrued interest, net of recognized allowance. Notes receivable, generally have terms of 12-18 months and bear interest from 9-12% per annum. Generally, product sales that are the basis for the note receivable are collateral on the note receivable until the note is paid off. At December 31, 2020 and 2019, the Company established an allowance for doubtful accounts of $292,050 and $0, respectively. We are exposed to credit risk in the normal course of business, primarily related to accounts and notes receivable. We are affected by general economic conditions in the United States. To limit credit risk, management periodically reviews and evaluates the financial condition of its customers and maintains an allowance for doubtful accounts. As of December 31, 2020 and 2019, we do not believe that we have significant credit risk. Inventory Inventory consists primarily of gardening supplies and materials and is recorded at the lower of cost (weighted average cost method) or net realizable value. The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions. Write-downs and write-offs are charged to cost of goods sold. Property and Equipment Property and equipment are carried at cost. Leasehold improvements are amortized using the straight-line method over the original term of the lease or the useful life of the improvement, whichever is shorter. Renewals and betterment that materially extend the life of the asset are capitalized. Expenditures for maintenance and repairs are charged against operations. Depreciation of property and equipment is provided on the straight-line method for financial reporting purposes at rates based on the following estimated useful lives: Estimated Lives Vehicle 5 years Building 20 years Furniture and fixtures 5-7 years Computers and equipment 3-5 years Leasehold improvements 10 years not to exceed lease term Software and Website Development Costs The Company accounts for the costs of computer software obtained or developed for internal use in accordance with FASB ASC 350, Intangibles — Goodwill and Other ● The Company expenses costs incurred in the preliminary project and post-implementation stages of software development and capitalizes costs incurred in the application development stage and costs associated with significant enhancements to existing internal use software applications. ● Software costs are amortized using the straight-line method over an estimated useful life of three years commencing when the software project is ready for its intended use. ● Costs incurred related to less significant modifications and enhancements as well as maintenance are expensed as incurred. As of December 31, 2020 and 2019, capitalized software cost were $1,162,603 and $138,280, respectively, before accumulated amortization of $221,885 and $5,000, respectively. Intangible Assets Acquired in Business Combinations The Company values assets acquired and liabilities assumed on each acquisition accounted for as a business combination, and allocates the purchase price to the tangible and intangible assets acquired and liabilities assumed based on its best estimate of fair value. Acquired intangible assets include, trade names, customer relationships, non-compete agreements. The Company determines the appropriate useful life of intangible assets by performing an analysis of cash flows based on historical experience of the acquired businesses. Intangible assets are amortized over their estimated useful lives based on the pattern in which the economic benefits associated with the asset are expected to be consumed, which to date has approximated the straight-line method of amortization. The estimated useful lives for trade names, customer relationships, non-compete agreements are generally, five to six years. Goodwill Goodwill represents the excess of purchase price over the fair value of net assets. Goodwill is not amortized but is reviewed for potential impairment on an annual basis, or if events or circumstances indicate a potential impairment, at the reporting unit level. The Company's review for impairment includes an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill, the first step of the two-step quantitative goodwill impairment test is performed, which compares the fair value of the reporting unit with its carrying amounts, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. However, if the carrying amount of the reporting unit exceeds its fair value, additional procedures must be performed. That additional procedure compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. An impairment loss is recorded to the extent that the carrying amount of goodwill exceeds its implied fair value. Leases We account for leases in accordance with the FASB ASC 842, Leases. We assess whether an arrangement is a lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We have elected the practical expedient to not separate lease and non-lease components for all assets. Operating lease assets and operating lease liabilities are calculated based on the present value of the future minimum lease payments over the lease term at the lease start date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the lease start date in determining the present value of future payments. The operating lease asset is increased by any lease payments made at or before the lease start date and reduced by lease incentives and initial direct costs incurred. The lease term includes options to renew or terminate the lease when it is reasonably certain that we will exercise that option. The exercise of lease renewal options is at our sole discretion. The depreciable life of lease assets and leasehold improvements are limited by the lease term. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: ● Level 1—Quoted prices in active markets for identical assets or liabilities. ● Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. ● Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and all other current liabilities approximate fair values due to their short-term nature. The fair value of notes receivable approximates the outstanding balance and are reviewed for impairment at least annually. The fair value of impaired notes receivable are determined based on estimated future payments discounted back to present value using the notes effective interest rate. Level December 31, 2020 December 31, 2019 Cash equivalents 2 $ 163,418,055 - Notes receivable 2 2,937,499 1,501,288 Notes receivable impaired 3 874,378 - Accounts receivable 2 3,900,519 2,953,921 For the Level 3 assets measured at fair value on a non-recurring base at December 31, 2020, the significant unobservable inputs include the notes receivable effective interest rate of 10%. Income Taxes The Company accounts for income taxes in accordance with FASB ASC 740, Income Taxes, which requires the recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. In 2019 and as of September 30, 2020, a valuation allowance was provided for the amount of deferred tax assets that would otherwise be recorded for income tax benefits primarily relating to operating loss carryforwards as realization could not be determined to be more likely than not. The Company adopted the provisions of FASB ASC 740-10-25, which prescribes a recognition threshold and measurement attribute for the recognition and measurement of tax positions taken or expected to be taken in income tax returns. FASB ASC 740-10-25 also provides guidance on recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions. The Company's tax returns are subject to tax examinations by U.S. federal and state authorities until their respective statute of limitation. Currently, the 2019, 2018 and 2017 tax years are open and subject to examination by taxing authorities. However, the Company is not currently under audit nor has the Company been contacted by any of the taxing authorities. The Company does not have any accrual for uncertain tax positions as of December 31, 2020. Advertising The Company expenses advertising and promotional costs when incurred. Advertising and promotional expenses for the years ended December 31, 2020 and 2019 amounted to $996,420 and $736,656, respectively. Earnings Per Share The Company computes net earnings per share under Accounting Standards Codification subtopic 260-10, Earnings Per Share The treasury stock method is used in calculating diluted EPS for potentially dilutive stock options, restricted stock and share purchase warrants, which assumes that any proceeds received from the exercise of in-the-money stock options, restricted stock and share purchase warrants, would be used to purchase common shares at the average market price for the period. Stock Based Compensation The Company records stock-based compensation in accordance with FASB ASC Topic 718, Compensation-Stock Compensation The Black-Scholes option pricing model requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. The expected term of options granted is derived from historical data on employee exercises and post-vesting employment termination behavior. The risk-free rate selected to value any particular grant is based on the U.S. Treasury rate that corresponds to the expected life of the grant effective as of the date of the grant. The expected volatility is based on the historical volatility of the Company's stock price. These factors could change in the future, affecting the determination of stock-based compensation expense in future periods. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | 3. RECENT ACCOUNTING PRONOUNCEMENTS From time to time, the Financial Accounting Standards Board ("FASB") or other standard setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification are communicated through issuance of an Accounting Standards Update ("ASU"). We have implemented all new accounting pronouncements that are in effect and that may impact our financial statements. We have evaluated recently issued accounting pronouncements and determined that there is no material impact on our financial position or results of operations. As an emerging growth company, the Company is permitted to delay the adoption of new or revised accounting standards until such time as those standards apply to private companies. The Company has chosen to take advantage of the extended transition period for complying with new or revised accounting standards. Recently Adopted Accounting Pronouncements As of January 1, 2019, the Company adopted the FASB ASU 2016-02, Leases Leases Leases On January 1, 2019, the Company also adopted ASU 2018-07, "Improvements to Nonemployee Share-Based Payment Accounting." ASU 2018-07 more closely aligns the accounting for employee and nonemployee share-based payments. The amendment is effective commencing in 2019 with early adoption permitted. The adoption of this new guidance did not have a material impact on our Financial Statements. In August 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. These amendments eliminate, modify, or integrate into other SEC requirements certain disclosure rules. Among the amendments is the requirement to present an analysis of changes in stockholders' equity in the interim financial statements included in Quarterly Reports on Form 10-Q. The analysis, which can be presented as a footnote or separate statement, is required for the current and comparative quarter and year-to-date interim periods. The amendments are effective for all filings made on or after November 5, 2018. The Company adopted these amendments in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2019. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement Recently Issued Accounting Pronouncements – Pending Adoption In October 2020, the Financial Accounting Standards Board ("FASB") issued new guidance that updates various codification topics by clarifying or improving disclosure requirements. The standard is effective for annual periods beginning after December 15, 2020. The Company does not expect the adoption of this new guidance to have a material impact on the Company's financial conditions, results or operations, cash flows or disclosures. In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments — Credit Losses (Topic 326)," changing the impairment model for most financial instruments by requiring companies to recognize an allowance for expected losses, rather than incurred losses as required currently by the other-than-temporary impairment model. The ASU will apply to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, available-for-sale and held-to-maturity debt securities, net investments in leases, and off-balance-sheet credit exposures. In November 2019, the FASB issued ASU No. 2019-10, changing effective dates for the new standards to give implementation relief to certain types of entities. The Company is required to adopt the new standards no later than January 1, 2023 according to ASU 2019-10, with early adoption allowed. We are currently evaluating the impact of adopting this new accounting guidance on our condensed consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The guidance in ASU 2017-04 eliminates the requirement to determine the fair value of individual assets and liabilities of a reporting unit to measure goodwill impairment. Under the amendments in the new ASU, goodwill impairment testing will be performed by comparing the fair value of the reporting unit with its carrying amount and recognizing an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value. ASU 2017-04 is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2022 and should be applied on a prospective basis. The Company is currently evaluating the impact of adopting this guidance on the Company's consolidated financial statements. In December 2019, the FASB issued ASU 2019-02, Simplifying the Accounting for Income Taxes, to simplify the accounting for income taxes by removing certain exceptions to the general principles and also simplification of areas such as franchise taxes, step-up in tax basis goodwill, separate entity financial statements and interim recognition of enactment of tax laws or rate changes. The standard will be effective for annual reporting periods beginning after December 15, 2020, including interim reporting periods within those periods. We are currently evaluating the impact of adopting this new accounting guidance on our condensed consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options: Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies the accounting for certain instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity's own equity. ASU 2020-06 removes from U.S. GAAP the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. ASU 2020-06 requires entities to provide expanded disclosures about "the terms and features of convertible instruments," how the instruments have been reported in the entity's financial statements, and "information about events, conditions, and circumstances that can affect how to assess the amount or timing of an entity's future cash flows related to those instruments." ASU 2020-06 is effective for public business entities that are not smaller reporting companies for fiscal years beginning after December 15, 2021 and interim periods within those fiscal years. For all other entities, ASU 2020-06 is effective for fiscal years beginning after December 15, 2023 and interim periods within those fiscal years. We are currently evaluating the impact of adopting this new accounting guidance on our condensed consolidated financial statements. |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2020 | |
Revenue Recognition [Abstract] | |
REVENUE RECOGNITION | 4. REVENUE RECOGNITION Disaggregation of Revenues The following table disaggregates revenue by source: Year Ended Year Ended Sales at company owned stores $ 182,736,434 $ 74,969,830 E-commerce sales 10,629,045 4,763,738 Total Revenues $ 193,365,479 $ 79,733,568 Contract Balances Depending on the timing of when a customer takes possession of product and when a customer makes payments for such product, the Company recognizes a customer trade receivable (asset) or a customer deposit (liability). The difference between the opening and closing balances of the Company's customer trade receivables and the customer deposit liability results from timing differences between the Company's performance and the customer's payment and due to the acquisitions for the years ended December 31, 2020 and 2019. The opening and closing balances of the Company's customer trade receivables and customer deposit liability are as follows: Receivables Customer Deposit Liability Opening balance, 1/1/2020 $ 4,455,209 $ 2,503,785 Closing balance, 12/31/2020 7,712,396 5,154,524 Increase (decrease) $ 3,257,187 2,650,739 Opening balance, 1/1/2019 $ 862,397 $ 516,038 Closing balance, 12/31/2019 4,455,209 2,503,785 Increase (decrease) $ 3,592,812 $ 1,987,747 The Company also has customer trade receivables under longer term financing arrangements at interest rates ranging from 9% to 12% with repayment terms ranging for 12 to 18 months. Long term trade receivables at December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Note receivable $ 4,103,927 $ 1,501,288 Allowance for losses (292,050 ) - Notes receivable, net $ 3,811,877 1,501,288 The following table summarizes changes in notes receivable balances that have been deemed impaired. December 31, December 31, Note receivable $ 1,166,428 $ 1,501,288 Allowance for loses (292,050 ) - Notes receivable, net $ 874,378 1,501,288 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 5. PROPERTY AND EQUIPMENT Property and equipment at December 31, 2020 and 2019 consists of the following: December 31, 2020 2019 Vehicle $ 1,342,127 $ 1,148,993 Building 477,280 - Leasehold improvements 1,987,991 884,685 Furniture, fixtures and equipment 5,738,798 2,858,777 9,546,196 4,892,455 Accumulated depreciation and amortization (3,071,066 ) (1,551,839 ) Property and equipment, net $ 6,475,130 $ 3,340,616 Depreciation expense was $1,646,907 and $1,046,328 for the years ended December 31, 2020 and 2019, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | 6. GOODWILL AND INTANGIBLE ASSETS The changes in goodwill are as follows: December 31, December 31, Balance, beginning of period $ 17,798,932 $ 8,752,909 Goodwill additions 45,152,529 9,046,023 Impairments - - Balance, end of period $ 62,951,461 $ 17,798,932 Intangible assets on the Company's consolidated balance sheets consist of the following: December 31, 2020 December 31, 2019 Gross Accumulated Gross Accumulated Tradenames $ 13,923,000 $ (398,567 ) $ - $ - Patents, trademarks 100,000 (9,051 ) 100,000 - Customer relationships 6,297,000 (137,814 ) - --- Non-competes 796,000 (21,743 ) - - Capitalized software 1,162,603 (221,884 ) 138,280 (5,000 ) $ 22,278,603 $ (789,059 ) $ 238,280 $ (5,000 ) Amortization expense for the years ended December 31, 2020 and 2019 was $789,058 and $5,000, respectively. Future amortization expense is as follows: 2021 $ 4,378,876 2022 4,396,281 2023 4,169,321 2024 4,069,439 2025 3,563,940 2026 911,687 Total $ 21,489,544 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 7. INCOME TAXES The provision (benefit) for income taxes for the years ended December 31, 2020 and 2019 consisted of the following: Year Ended December 31, December 31, Income Tax Expense (benefit) Current federal tax expense Federal $ 1,732,230 $ 479,000 State 768,231 - Deferred tax (benefit) Federal $ 1,705,540 $ (479,000 ) State 226,590 - Valuation allowance (1,181,700 ) Total $ 3,250,891 $ - A summary of deferred tax assets and liabilities as of December 31, 2020 and 2019 is as follows: Year Ended December 31, December 31, Deferred tax assets: Net operating losses $ - $ 1,033,300 Deferred right to use lease liabilities 3,248,501 1,671,700 Stock based compensation 756,789 354,800 Inventory reserves 235,612 - Warranty reserves 146,472 - Accruals and other 180,345 160,200 4,567,719 3,220,000 Deferred tax liabilities: Deferred right to use lease assets (3,146,758 ) (1,678,300 ) Accumulated depreciation and amortization $ (2,171,391 ) $ (360,000 ) (5,318,149 ) 2,038,300 Gross deferred tax asset (liability) (750,430 ) 1,181,700 Valuation Allowance - (1,181,700 ) Deferred tax asset (liability), net $ (750,430 ) $ - We recorded a valuation allowance against all of our deferred tax assets as of December 31, 2019. Given our current earnings and anticipated future earnings, we believe that there was sufficient positive evidence available that allowed us to reach the conclusion that the valuation allowance will no longer be needed as of December 31, 2020. Release of the valuation allowance in 2020 resulted in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. The differences between the U.S. Federal statutory income tax rate and the Company's effective tax rate were as follows for the years ended December 31, 2020 and 2019: Years Ended December 31, 2020 2019 Federal statutory tax rate 21 % 21 % State and local income taxes (net of federal tax benefit) 6 % 4 % 27 % 25 % Other 6 % - Non-deductible compensation 3 % - Incentive stock options 4 % Basis adjustments 12 % - Valuation allowance (14 )% (25 )% 38 % 0 % |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | 8. LONG-TERM DEBT December 31, 2020 2019 Long term debt is as follows: Wells Fargo Equipment Finance, interest at 3.5% per annum, payable in monthly installments of $518.96 beginning April 2016 through March 2021, secured by warehouse equipment with a book value of $25,437 $ 1,032 $ 7,109 Notes payable issued in connection with seller financing of assets acquired, interest at 1%, payable in 24 installments of $24,996, due and paid in full in February 2020 - 24,997 Notes payable issued in connection with seller financing of assets acquired, interest at 8.125%, payable in 60 installments of $8,440, due August 2023 239,832 320,204 $ 240,864 $ 352,310 Less Current Maturities (82,877 ) (110,231 ) Total Long-Term Debt $ 157,987 $ 242,079 Debt maturities as of December 31, 2020 are as follows: 2021 $ 82,877 2022 99,184 2023 58,803 $ 240,864 Interest expense for the years ended December 31, 2020 and 2019 was $14,053 and $45,191, respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
LEASES | 9. LEASES We determine if a contract contains a lease at inception. Our material operating leases consist of retail and warehouse locations as well as office space. Our leases generally have remaining terms of 1-10 years, most of which include options to extend the leases for additional 3 to 5-year periods. Generally, the lease term is the minimum of the noncancelable period of the lease or the lease term inclusive of reasonably certain renewal periods. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental secured borrowing rates corresponding to the maturities of the leases. Our leases typically contain rent escalations over the lease term. We recognize expense for these leases on a straight-line basis over the lease term. We have elected the practical expedient to account for lease and non-lease components as a single component for our entire population of leases. Short-term disclosures include only those leases with a term greater than one month and 12 months or less, and expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less, that do not include an option to purchase the underlying asset that we are reasonably certain to exercise, are not recorded on the balance sheet. Lease expense is recorded within our consolidated statements of operations based upon the nature of the assets. Where assets are used to directly serve our customers, such as facilities dedicated to customer contracts, lease costs are recorded in "store operating costs." Facilities and assets which serve management and support functions are expensed through general and administrative expenses. December 31, December 31, Right to use assets, operating lease assets $ 12,088,390 $ 7,628,591 Current lease liability $ 3,000,684 $ 1,836,700 Non-current lease liability 9,478,553 5,807,266 $ 12,479,237 $ 7,643,966 December 31, December 31, Weighted average remaining lease term 3.5 years 3.9 years Weighted average discount rate 7.6 % 7.6 % Year Ended December 31, 2020 2019 Operating lease costs $ 2,800,535 $ 1,914,161 Variable lease costs 1,071,089 525,292 Short-term lease costs 94,561 29,400 Total operating lease costs $ 3,966,185 $ 2,468,853 The following table presents the maturity of the Company's operating lease liabilities as of December 31, 2020: 2021 $ 4,118,220 2022 3,542,939 2023 3,025,729 2024 2,041,096 2025 1,676,619 Thereafter 2,379,935 Total lease payments 16,784,538 Less: Imputed interest (4,305,301 ) Lease Liability at December 31, 2020 $ 12,479,237 |
Convertible Debt
Convertible Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE DEBT | 10. CONVERTIBLE DEBT On January 12, 2018, the Company completed a private placement of a total of 36 units of the Company's securities at the price of $250,000 per unit pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act") and Rule 506 of Regulation D promulgated thereunder. Each unit consisted of (i) a .1% unsecured convertible promissory note of the principal amount of $250,000, and (ii) a 3-year warrant entitling the holder to purchase 37,500 shares of the Company's common stock, par value $.001 per share, at a price of $.01 per share or through cashless exercise. The convertible debt had a maturity date of January 12, 2021 and the principal balance and any accrued interest is convertible by the holder at any time into Common Stock of the Company at conversion price of $3.00 a share. Principal due and interest accrued on the notes will automatically convert into shares of Common Stock, at the conversion price, if at any time during the term of the notes, commencing twelve (12) months from the date of issuance, the Common Stock trades minimum daily volume of at least 50,000 shares for twenty (20) consecutive days with a volume weighted average price of at least $4.00 per share. During the year ended December 31, 2019, convertible debt and accrued interest of $2,405,269, net of unamortized debt discount of $674,581, was converted into 1,258,608 shares of common stock at the conversion rate of $3.00 per share. As of December 31, 2019, there was no convertible debt remaining. Amortization of debt discount for the years ended December 31, 2020 and 2019 was $0 and $356,306, respectively. At December 31, 2020 and 2019 there were 93,750 and 131,250 warrants outstanding, respectively, related to the issuance of convertible debt. |
Share Based Payments
Share Based Payments | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
SHARE BASED PAYMENTS | 11. SHARE BASED PAYMENTS The Company maintains long-term incentive plans for employee, non-employee members of our Board of Directors and consultants. The Plans allows us to grant equity-based compensation awards, including stock options, stock appreciation rights, performance share units, restricted stock units, restricted stock awards, or a combination of awards (collectively, share-based awards). On March 6, 2014, the Company's Board of Directors (the "Board") approved the 2014 Equity Incentive Plan ("2014 Plan") pursuant to which the Company may grant incentive, non-statutory options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other stock or cash awards to employees, nonemployee members of our Board, consultants and other independent advisors who provide services to the Company. The maximum shares of common stock which may be issued over the term of the 2014 Plan shall not exceed 2,500,000 shares. Awards under the 2014 Plan are made by the Board or a committee designated by the Board. Options under the 2014 Plan are to be issued at the market price of the stock on the day of the grant except to those issued to holders of 10% or more of the Company's common stock which is required to be issued at a price not less than 110% of the fair market value on the day of the grant. Each option is exercisable at such time or times, during such period and for such numbers of shares shall be determined by the plan administrator. No option may be exercisable for more than ten years (five years in the case of an incentive stock option granted to a 10% stockholder) from the date of grant. On January 7, 2018, the Board adopted the 2018 Equity Compensation Plan (the "2018 Plan") and on April 20, 2018, the shareholders approved the 2018 Plan. On February 7, 2020, the Board approved the amendment and restatement of the 2018 Plan to increase the number of shares issuable thereunder from 2,500,000 to 5,000,000, which amendment was approved by shareholders on May 11, 2020. The 2018 Plan will be administered by the Board. The Board may grant options to purchase shares of common stock, stock appreciation rights, restricted stock units, restricted or unrestricted shares of common stock, performance shares, performance units, other cash-based awards and other stock-based awards. The Board also has broad authority to determine the terms and conditions of each option or other kind of equity award, adopt, amend and rescind rules and regulations for the administration of the 2018 Plan and amend or modify outstanding options, grants and awards. No options, stock purchase rights or awards may be made under the 2018 Plan on or after the ten-year anniversary of the adoption of the 2018 Plan by the Board, but the 2018 Plan will continue thereafter while previously granted options, stock appreciation rights or awards remain subject to the 2018 Plan. Options granted under the 2018 Plan may be either "incentive stock options" that are intended to meet the requirements of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") or "nonstatutory stock options" that do not meet the requirements of Section 422 of the Code. The Board will determine the exercise price of options granted under the 2018 Plan. The exercise price of stock options may not be less than the fair market value, on the date of grant, per share of our Common Stock issuable upon exercise of the option (or 110% of fair market value in the case of incentive options granted to a 10% stockholder). No option may be exercisable for more than ten years (five years in the case of an incentive stock option granted to a 10% stockholder) from the date of grant. The Company accounts for share-based payments through the measurement and recognition of compensation expense for share-based payment awards made to employees and directors of the Company, including stock options and restricted shares. The Company also issues share based payments in the form of common stock warrants to non-employees. The following table presents share-based payment expense for the years ended December 31, 2020 and 2019. December 31, 2020 2019 Restricted stock $ 5,164,133 $ 1,419,323 Stock options 2,250,662 1,071,212 Warrants 441,368 - Total $ 7,856,163 $ 2,490,535 As of December 31, 2020, the Company had approximately $3.7 million of unamortized share-based compensation for option awards and restricted stock awards, which is expected to be recognized over a weighted average period of two years. As of December 31, 2020, the Company also had approximately $4 million of unamortized share-based compensation for common stock warrants issued to consultants, which is expected to be recognized over a weighted average period of 3 years. Restricted Stock The Company issues shares of restricted stock to eligible employees, which are subject to forfeiture until the end of an applicable vesting period. The awards generally vest on the second or third anniversary of the date of grant, subject to the employee's continuing employment as of that date. Restricted stock activity for the years ended December 31, 2020 and 2019 is presented in the following table: Shares Weighted Average Grant Date Fair Value Nonvested, January 1, 2019 55,000 $ 3.35 Granted 353,500 2.50 Vested (201,000 ) 3.02 Forfeited (3,500 ) 5.91 Nonvested, December 31, 2019 204,000 $ 3.82 Granted 1,293,000 4.90 Vested (799,833 ) 5.16 Forfeited (66,667 ) 4.15 Nonvested, December 31, 2020 630,500 $ 4.51 Stock Option Awards issued under the 2014 Plan as of December 31, 2020 are summarized below: 2020 Total Shares available for issuance pursuant to the 2014 Plan 2,500,000 Options outstanding, December 31 2020 (50,000 ) Total options exercised under 2014 Plan (2,058,833 ) Total shares issued pursuant to the 2014 Plan (375,000 ) Awards available for issuance under the 2014 Plan, December 31, 2020 16,167 2020 Total Shares available for issuance pursuant to the 2018 Plan, as amended 5,000,000 Options outstanding, December 31 2020 (1,486,438 ) Total options exercised under 2018 Plan (438,895 ) Total shares issued pursuant to the 2018 Plan (1,112,979 ) Awards available for issuance under the 2018 Plan, December 31, 2020 1,961,688 The fair value of each stock option and warrant granted is estimated on the grant date using the Black-Scholes option valuation model. The assumptions used to calculate the fair value of options and warrants granted are evaluated and revised, as necessary, to reflect market conditions and the Company's experience. Stock options and warrants are expensed on a straight-line basis over the vesting period, which is considered to be the requisite service period. 2020 2019 Expected volatility 77.75-80.7 % 87.8%-92.7 % Expected dividends None None Expected term 2-5 years 2-5 years Risk-free rate 1.64-1.75 % 1.64 % Options outstanding pursuant to 2014 Plan 50,000 Options outstanding pursuant to 2018 Plan 1,486,438 Options issued outside of 2014 and 2018 Plans 266,670 Total options outstanding December 31, 2020 1,803,108 The table below summarizes all the options granted by the Company during years ended December 31, 2020 and 2019: Options Shares Weighted- Weighted- Average Remaining Contractual Term Weighted- Outstanding at January 1, 2019 1,815,500 $ 1.66 2.65 years $ .78 Granted 795,000 $ 3.42 $ 2.31 Exercised (667,500 ) $ .72 $ .16 Forfeited or expired (17,667 ) $ 2.78 $ 1.49 Outstanding at December 31, 2019 1,925,333 $ 2.71 3.60 years $ 1.71 Vested and exercisable at December 31, 2019 1,346,333 $ 2.36 3.25 years $ 1.32 Outstanding at January 1, 2020 1,925,333 $ 2.71 3.60 years $ 1.71 Granted 891,500 $ 4.75 $ 2.67 Exercised (983,725 ) $ 2.59 $ 1.35 Forfeited or expired (30,000 ) $ 2.75 $ 1.63 Outstanding at December 31, 2020 1,803,108 $ 3.92 3.47 years $ 2.38 Vested and exercisable at December 31, 2020 1,057,734 $ 3.55 3.13 Years $ 2.00 |
Stock Purchase Warrants
Stock Purchase Warrants | 12 Months Ended |
Dec. 31, 2020 | |
Warrants and Rights Note Disclosure [Abstract] | |
STOCK PURCHASE WARRANTS | 12. STOCK PURCHASE WARRANTS A summary of the status of the Company's outstanding stock warrants as of December 31, 2020 and 2019 is as follows: Weighted Average Exercise Outstanding January 1, 2019 3,295,667 $ 1.94 Granted/issued 2,061,629 $ 3.50 Exercised (1,643,610 ) $ .79 Forfeited - Outstanding December 31, 2019 3,713,686 $ 3.25 Granted/issued 305,000 $ 24.66 Exercised (2,468,963 ) $ 3.05 Forfeited (250,000 ) 5.75 Outstanding December 31, 2020 1,299,723 $ 8.03 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | 13. EARNINGS PER SHARE The following table sets forth the composition of the weighted average shares (denominator) used in the basic and dilutive earnings per share computation for the years ended December 31, 2020 and 2019. Year Ended December 31, 2020 2019 Net income $ 5,328,378 $ 1,321,842 Weighted average shares outstanding, basic 43,944,879 32,833,594 Effect of dilutive outstanding warrants and stock options 2,511,370 1,076,560 Adjusted weighted average shares outstanding, dilutive 46,456,249 33,910,154 Basic income per shares $ .12 $ .04 Dilutive income per share $ .11 $ .04 |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2020 | |
Employee Benefit Plan [Abstract] | |
EMPLOYEE BENEFIT PLAN | 14. EMPLOYEE BENEFIT PLAN The Company has a 401(k) Savings Retirement Plan that covers substantially all full-time employees who meet the plan's eligibility requirements and provides for an employee elective contribution. The Company made matching contributions to the plan of $169,327 and $83,158 for the years ended December 31, 2020 and 2019, respectively. |
Vendor Concentrations
Vendor Concentrations | 12 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
VENDOR CONCENTRATIONS | 15. VENDOR CONCENTRATIONS As of December 31, 2020, and 2019, two suppliers represent 41% and 51% of our total vendor purchases, respectively. Although the Company expects to maintain relationships with these vendors, the loss of either supplier would not have a material adverse impact on our business, because both suppliers provide the same products. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
ACQUISITIONS | 16. ACQUISITIONS Our acquisition strategy is to acquire well established profitable hydroponic garden centers in markets where the Company does not have a market presence or in markets where it is increasing its market presence. The Company accounts for acquisitions in accordance with ASC 805 "Business Combinations." Assets acquired and liabilities assumed are recorded in the accompanying consolidated balance sheets at their estimated fair values, as of the acquisition date. For all acquisitions, the preliminary allocation of the purchase price was based upon a preliminary valuation, and the Company's estimates and assumptions are subject to change within the measurement period as valuations are finalized. Any changes to these estimates may have a material impact on the Company's operating results or financial position. All acquisition costs are expensed as incurred and recorded in general and administrative expenses in the consolidated statements of operations. Transaction cost were approximately $227,000 for all acquisitions in 2020. To date all goodwill recorded as a result of business combinations is deductible for income tax purposes. The Company issued 23,892 shares of common stock valued at $100,829 to settle as contingent consideration related to the Heavy Gardens 2018 business combination. On February 26, 2020 we acquired certain assets of Health & Harvest LLC in a transaction valued at approximately $2.85 million. Acquired goodwill of approximately $1.1 million represents the value expected to rise from organic growth and an opportunity to expand into a well-established market for the Company. Cash consideration was funded from the Company's existing working capital. On June 16, 2020 we acquired certain assets of H2O Hydroponics, LLC ("H2O Hydro") in a transaction valued at approximately $1.99 million. Acquired goodwill of approximately $1 million represents the value expected to rise from organic growth and an opportunity to expand into a well-established market for the Company. Cash consideration was funded from the Company's existing working capital. On August 10, 2020 we acquired certain assets of Benzakry Family Corp, d/b/a Emerald City Garden ("Emerald City"), in a transaction valued at $1 million. Acquired goodwill of approximately $620,000 represents the value expected to rise from organic growth and an opportunity to expand into a well-established market for the Company. Cash consideration was funded from the Company's existing working capital. On October 12, 2020, the Company acquired the assets of Hydroponics Depot, LLC ("Hydro Depot"), a single store located in Phoenix Arizona for $987,500 in cash and shares of the Company's common stock valued at approximately $548,000. Acquired goodwill of approximately $798,000 represents the value expected to rise from organic growth and an opportunity to expand into a well-established market for the Company. On October 20, 2020 the Company acquired the assets of Big Green Tomato ("BGT"), a two-store chain in Battle Creek and Taylor, Michigan for approximately $6.0 in cash and shares of common stock valued at approximately $3.1 million. On November 17, 2020, the Company acquired the assets of The GrowBiz ("GrowBiz"), a five-store chain with four stores in California and one store in Oregon. The total consideration for the purchase of GrowBiz was approximately $44.7 million, $17.4 million in cash and common stock valued at approximately $27.3 million. Acquired goodwill of approximately $28.3 million represents the value expected to rise from organic growth and an opportunity to expand into a well-established market for the Company. On December 14, 2020, the Company acquired the assets of Grassroots, a three-store chain in California. The total consideration for the purchase of Grassroots was approximately $10 million, $7.5 million in cash and common stock valued at approximately $2.5 million. Acquired goodwill of approximately $4.5 million represents the value expected to rise from organic growth and an opportunity to expand into a well-established market for the Company. On December 23, 2020, the Company acquired the assets of Canopy Crop Management ("Canopy") and its complete portfolio of products including the Power SI brand of silicic acid-enriched fertilizers. The total consideration for the purchase of Canopy Crop was approximately $9.2 million, $5.4 million in cash and common stock valued at approximately $3.8 million. Acquired goodwill of approximately $4.9 million represents the value expected to rise from organic growth and an opportunity to expand into a well-established product distribution market for the Company. The table below represents the allocation of the purchase price to the acquired net assets during the year ended December 31, 2020. Canopy Grassroots GrowBiz BGT Hydro Depot Emerald H2O Health & Total Inventory $ 898,700 $ 2,348,200 $ 6,285,900 $ 1,595,000 $ 333,300 $ 150,000 $ 497,600 $ 1,053,900 $ 13,162,600 Prepaids and other current assets - - - - 4,600 - 4,600 Building - - - 477,300 - - - - 477,300 Furniture and equipment - 150,000 200,000 250,000 25,000 10,000 50,000 51,000 736,000 Operating lease right to use asset - 1,436,800 3,640,700 245,500 - - 902,000 192,600 6,417,600 Operating lease liability - (1,436,800 ) (3,640,700 ) (245,500 ) - - (902,000 ) (192,600 ) (6,417,600 ) Customer relationships 2,267,000 767,000 1,910,000 601,000 148,000 208,000 150,000 246,000 6,297,000 Trade name 1,138,000 2,138,000 7,745,000 2,025,000 212,000 - 234,000 431,000 13,923,000 Non-compete 113,000 133,000 374,000 94,000 19,000 14,000 43,000 6,000 796,000 Goodwill 4,822,900 4,464,000 28,271,400 4,001,600 798,500 620,000 1,007,700 1,065,600 45,051,700 Total $ 9,239,600 $ 10,000,200 $ 44,786,300 $ 9,043,900 $ 1,535,800 $ 1,000,000 $ 1,986,900 $ 2,853,500 $ 80,446,200 The table below represents the consideration paid for the net assets acquired in business combinations. Canopy Grassroots GrowBiz BGT Hydro Depot Emerald H2O Health & Total Cash $ 5,423,600 $ 7,498,900 $ 17,486,900 $ 5,972,300 $ 987,500 $ 1,000,000 $ 1,281,700 $ 1,750,000 $ 41,400,900 Common stock 3,816,000 2,501,300 27,299,400 3,071,600 548,300 - 705,200 1,103,500 39,045,300 Total $ 9,239,600 $ 10,000,200 $ 44,786,300 $ 9,043,900 $ 1,535,800 $ 1,000,000 $ 1,986,900 $ 2,853,500 $ 80,446,200 The following table discloses the date of the acquisitions noted above and the revenue and earnings included in the consolidated income statement from the date of acquisition to the period ended December 31, 2020. Canopy Grassroots GrowBiz BGT Hydro Depot Emerald H2O Health & Total Acquisition date 12/23/2020 12/14/2020 11/17/2020 10/20/2020 10/12/2020 8/10/2020 6/16/2020 2/26/2020 Revenue $ 300,500 $ 531,800 $ 3,852,100 $ 1,859,200 $ 1,244,600 $ 5,634,800 $ 2,418,100 $ 8,994,900 $ 24,836,000 Net Income $ 141,100 $ 74,400 $ 735,900 $ 187,800 $ 148,800 $ 1,005,000 $ 561,800 $ 1,065,600 $ 3,920,400 The following represents the pro forma consolidated income statement as if the acquisitions had been included in the consolidated results of the Company for the entire period for the year ended December 31, 2020 and 2019. December 31, December 31, Revenue $ 116,120,116 $ 71,649,931 Net income $ 12,979,881 $ 689,728 The table below represents the allocation of the purchase price to the acquired net assets during the year ended December 31, 2019. Grow Grand Green Chlorophyll Reno Palm Total Inventory $ 553,900 $ 1,453,100 $ 1,038,600 $ 1,441,000 $ 238,000 $ 465,500 $ 5,190,100 Prepaids and other current assets - 14,100 22,000 - 36,100 Furniture and equipment 35,000 50,000 100,000 100,000 25,000 25,000 335,000 Goodwill 696,900 2,376,900 2,305,900 2,596,100 516,300 554,000 9,046,100 Total $ 1,285,800 $ 3,880,000 $ 3,458,600 $ 4,159,100 $ 779,300 $ 1,044,500 $ 14,607,300 The table below represents the consideration paid for the net assets acquired in business combinations. Grow Grand Green Chlorophyll Reno Palm Total Cash $ 1,000,000 $ 2,350,000 $ 2,647,700 $ 3,659,100 $ 525,000 $ 800,000 $ 10,981,800 Common stock 285,800 1,530,000 810,900 500,000 254,300 244,500 3,625,500 Total $ 1,285,800 $ 3,880,000 $ 3,458,600 $ 4,159,100 $ 779,300 $ 1,044,500 $ 14,607,300 The following table discloses the date of the acquisitions noted above and the revenue and earnings included in the consolidated income statement from the date of acquisition to the period ended December 31, 2019. Grow Grand Green Chlorophyll Reno Palm Total Acquisition date 12/16/19 9/3/2019 5/14/2019 1/21/2019 2/11/2019 2/7/2019 Revenue $ 153,900 $ 2,412,700 $ 4,829,800 $ 6,030,500 $ 2,106,900 $ 3,075,300 $ 18,609,100 Earnings $ 6,400 $ 444,500 $ 998,700 $ 936,600 $ 366,742 $ 651,400 $ 3,404,342 The following represents the pro forma consolidated income statement as if the acquisitions had been included in the consolidated results of the Company for the entire period for the years ended December 31,2019 and 2018. December 31, December 31, Revenue $ 31,300,425 $ 59,650,900 Earnings $ 4,750,591 $ (2,087,900 ) |
Stockholders Equity
Stockholders Equity | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity: | |
Stockholders Equity | 17. STOCKHOLDERS EQUITY 2020 On December 11, 2020, the Company consummated an underwritten public offering of 5,750,000 shares of its common stock (the "Shares"), which included the exercise in full of the underwriters' option to purchase an additional 750,000 shares of common stock before deducting the underwriting discounts and commissions and other offering expenses On July 2, 2020, the Company consummated an underwritten public offering of 8,625,000 shares of its common stock (the "Shares"), which included the exercise in full of the underwriters' option to purchase an additional 1,125,000 shares of common stock before deducting the underwriting discounts and commissions and other offering expenses 2019 On June 26, 2019, the Company completed a private placement of a total of 4,123,257 units of the Company's securities at the price of $3.10 per unit pursuant to Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D promulgated under the Securities Act. Each unit consisted of (i) one share of Common Stock and (ii) one 3-year warrant, each entitling the holder to purchase one half share of Common Stock, at a price of $3.50 per share. The Company raised a total of $12,782,099 from 19 accredited investors. |
Correction of Error in Previous
Correction of Error in Previously Reported Consolidated Financial Statements | 12 Months Ended |
Dec. 31, 2020 | |
Correction of Error in Previously Reported Consolidated Financial Statements [Abstract] | |
CORRECTION OF ERROR IN PREVIOUSLY REPORTED CONSOLIDATED FINANCIAL STATEMENTS | 18. CORRECTION OF ERROR IN PREVIOUSLY REPORTED CONSOLIDATED FINANCIAL STATEMENTS Revision During the fourth quarter of 2020, we identified amounts presented in our inventory and costs of sales reported in prior years that required revision. The revised amounts resulted from an accumulation of errors related to rebates issued from vendors. We determined these errors accumulated in 2019 and prior years. Retained earnings as of January 1, 2019, was also revised to reflect the impact of the error on prior periods. The impact of the error for periods prior 2019 was $525,786. Pursuant to the guidance of Staff Accounting Bulletin No. 99, Materiality, we concluded that the errors were not material to any of our prior year consolidated financial statements. The accompanying consolidated balance sheet and income statement as of December 31, 2019 includes a cumulative revision relating to this error. This revision did not have any material effect on income from operations, net income, or cash flows. This revision had no effect on our cash balances. The following table compares previously reported balances, adjustments, and revised balances as of December 31, 2019. The revised consolidated financial statements for the year ended December 31, 2019 with the adjustment is detailed below. December 31, 2019 As Previously Reported Adjustment Revised ASSETS Current assets: Cash and cash equivalents $ 12,979,444 $ 12,979,444 Accounts receivable, net 2,953,921 2,953,921 Notes receivable, net 1,037,541 1,037,541 Inventory 22,659,357 (1,082,748 ) 21,576,609 Prepaids and other current assets 2,549,559 2,549,559 Total current assets 42,171,822 41,097,074 Property and equipment, net 3,340,616 3,340,616 Operating leases right-of-use assets, net 7,628,591 7,628,591 Notes receivable 463,747 463,747 Intangible assets, net 233,280 233,280 Goodwill 17,798,932 17,798,932 Other assets 377,364 377,364 TOTAL ASSETS $ 72,022,352 $ 70,939,604 LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 6,024,750 6,024,750 Payroll and payroll tax liabilities 1,072,142 1,072,142 Customer deposits 2,503,785 2,503,785 Sales tax payable 533,656 533,656 Current maturities of right-of-use assets 1,836,700 1,836,700 Current portion of long-term debt 110,231 110,231 Total current liabilities 12,081,264 12,081,264 Operating leases right-of-use assets, net of current maturities 5,807,266 5,807,266 Long-term debt, net of current portion 242,079 242,079 Total liabilities 18,130,609 18,130,609 Stockholders' Equity: Common stock; $.001 par value; 100,000,000 shares 36,876,305 shares issued and outstanding as of December 31, 2019 36,876 36,876 Additional paid-in capital 60,742,055 60,742,055 Accumulated deficit (6,887,188 ) (1,082,748 ) (7,969,936 ) Total stockholders' equity 53,891,743 52,808,995 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 72,022,352 $ 70,939,604 Year Ended December 31, 2019 As Previously Reported Adjustment Revised Sales $ 79,733,568 $ 79,733,568 Cost of sales 57,171,721 556,962 57,728,683 Gross profit 22,561,847 22,004,885 Operating expenses: Store operations 10,095,422 10,095,422 General and administrative 3,172,019 3,172,019 Share based compensation 2,490,535 2,490,535 Depreciation and amortization 1,044,553 1,044,553 Salaries and related expenses 3,619,197 3,619,197 Total operating expenses 20,421,726 20,421,726 Net income from operations 2,140,121 1,583,159 Other income (expense): Miscellaneous income (expense) (4,545 ) (4,545 ) Interest income 144,725 144,725 Interest expense (401,497 ) (401,497 ) Total non-operating income (expense), net (261,317 ) (261,317 ) Net income before taxes 1,878,804 1,321,842 Provision for income taxes 0 0 Net income $ 1,878,804 1,321,842 Net income per share, basic $ 0.06 $ 0.04 Net income per share, diluted $ 0.06 $ 0.04 Weighted average shares outstanding, basic 32,833,594 32,833,594 Weighted average shares outstanding, diluted 33,910,154 33,910,154 For The Year Ended December 31, 2019 Cash Flows from Operating Activities: As Previously Reported Adjustment Revised Net income $ 1,878,804 (556,962 ) $ 1,321,842 Adjustments to reconcile net income to net cash used in operating Activities: - Depreciation and amortization 1,044,553 1,044,553 Provision for doubtful accounts receivable 172,135 172,135 Inventory valuation reserve 429,126 429,126 Amortization of debt discount 356,306 356,306 Stock based compensation 2,490,535 2,490,535 Other (66,536 ) (66,536 ) Changes in operating assets and liabilities: - (Increase) decrease in: - Accounts receivable (3,764,947 ) (3,764,947 ) Inventory (10,482,014 ) 556,962 (9,925,052 ) Prepaid expenses and other assets (2,061,701 ) (2,061,701 ) Increase (decrease) in: - Accounts payable and accrued liabilities 4,165,188 4,165,188 Operating leases 15,375 15,375 Customer deposits 1,987,747 1,987,747 Income taxes - - Payroll and payroll tax liabilities 154,471 154,471 Sales taxes payable 341,698 341,698 Net Cash and Cash Equivalents (Used In) Operating Activities (3,339,260 ) (3,339,260 ) Cash Flows from Investing Activities: Assets acquired in business combinations (9,458,743 ) (9,458,743 ) Purchase of property and equipment (2,232,812 ) (2,232,812 ) Purchase of goodwill and other intangibles (119,125 ) (119,125 ) Net Cash and Cash Equivalents (Used In) Investing Activities (11,810,680 ) (11,810,680 ) Cash Flows from Financing Activities: Principal payments on long term debt (460,129 ) (460,129 ) Stock redemptions - - Proceeds from the sales of common stock and exercise of warrants and options, net of expenses 13,949,532 13,949,532 Net Cash and Cash Equivalents Provided by Financing Activities 13,489,403 13,489,403 Net Increase(decrease) in Cash and Cash Equivalents (1,660,537 ) (1,660,537 ) Cash and Cash Equivalents at Beginning of year 14,639,981 14,639,981 Cash and Cash Equivalents at End of year $ 12,979,444 $ 12,979,444 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 19. SUBSEQUENT EVENTS The Company has evaluated events and transaction occurring subsequent to December 31, 2020 up to the date of this filing of these consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that evaluation. For all acquisitions subsequent to year end the Company's the initial accounting for the business combination has not been completed because the valuations have not yet been received from the Company's independent valuation firm. On January 25, 2021 the Company purchased the assets of Indoor Garden & Lighting, Inc, a two-store chain of hydroponic and equipment and indoor gardening supply stores serving the Seattle and Tacoma, Washington area. On February 1, 2021 the Company purchased the assets of J.A.R.B., Inc d/b/a Grow Depot Maine, a two-store chain in Auburn and Augusta, Maine. On February 15, 2021 the Company purchased the assets of Grow Warehouse LLC, a four-store chain of hydroponic and organic garden stores in Colorado (3) and Oklahoma (1). On February 22, 2021 the Company purchased the assets of San Diego Hydroponics & Organics, a four-store chain of hydroponic and organic garden stores in San Diego, CA. On March 12, 2021 the Company purchased the assets of Charcoir Corporation, who sells an RHP-certified growing medium made from the highest-grade coconut fiber. On March 15, 2021 the Company purchased the assets of 55 Hydroponics, a hydroponic and organic superstore located in Santa Ana, CA. On March 15, 2021 the Company purchased the assets of Aquarius, a hydroponic and organic garden store in Springfield, MA. On March 19, 2021 the Company purchased the assets of Agron, LLC, an online seller of growing equipment. The total consideration for the purchase of Agron was approximately $11.3 million, including $6 million in cash and common stock valued at approximately $5.3 million. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The financial statements are prepared under the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 105-10, Generally Accepted Accounting Principles The consolidated financial statements include the Company and its wholly-owned subsidiaries. All intercompany balances and transactions are eliminated in consolidation. |
Reclassifications | Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income. |
Use of Estimates | Use of Estimates Management uses estimates and assumptions in preparing these consolidated financial statements in accordance with generally accepted accounting principles. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported revenues and expenses during the reporting period. Actual results could vary from the estimates that were used. Additionally, the full impact of COVID-19 is unknown and cannot be reasonably estimated. However, we have made appropriate accounting estimates based on the facts and circumstances available as of the reporting date. To the extent there are differences between these estimates and actual results, our consolidated financial statements may be materially affected. As we continue to monitor the COVID-19 situation, the Company is considered an "essential" supplier to the agricultural industry, suppling the nutrients and nourishment required to feed their plants. The Company has remained open during this difficult time. We have plans and procedures in place to ensure our customers and employees stay safe during this time of uncertainty. As a result of COVID-19 we reduced some hours of operations at the store level and some stores were closed on the weekends, primarily in the later part of the first quarter of 2020. There have been some minor delays in vendor shipments as their warehouses and supply chain were affected by staffing shortages. The Company successfully implemented a will call and curb side pick-up process that is working well. Other than what has been disclosed above, we have not experienced adverse effects from COVID-19. |
Segment Reporting | Segment Reporting Management makes significant operating decisions based upon the analysis of the entire Company and financial performance is evaluated on a company-wide basis. Accordingly, the various products sold are aggregated into one reportable operating segment as under guidance in the Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC or codification") Topic 280 for segment reporting. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue, net of estimated returns and sales tax, at the time the customer takes possession of merchandise or receives services at which point, the performance obligation is satisfied. Sales and other taxes collected concurrent with revenue producing activities are excluded from revenue. In the normal course of business, the Company does not accept product returns unless the item is defective as manufactured. The Company monitors provisions for estimated returns. Payment for goods and services sold by the Company is typically due upon satisfaction of the performance obligations. Under certain circumstances, the Company does provide goods and services to customers on a credit basis (see Accounts Receivable, Notes Receivable and Concentration of Credit Risk |
Vendor Allowances | Vendor Allowances Vendor allowances primarily consist of volume rebates that are earned as a result of attaining certain purchase levels. These vendor allowances are accrued as earned, with those allowances received as a result of attaining certain purchase levels accrued over the incentive period based on estimates of purchases. Volume rebates, when earned, are recorded as a reduction in cost of sales or cost of inventory. |
Cash Equivalents | Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company's cash equivalents are carried at fair market value and consist primarily of money market funds. Financial instruments that potentially expose us to concentrations of risk consist primarily of cash and cash equivalents and accounts receivable, which are generally not collateralized. Our policy is to place our cash and cash equivalents with high quality financial institutions, in order to limit the amount of credit exposure. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (FDIC), up to $250,000. At December 31, 2020 and 2019, the Company had approximately $174 million and $11 million, respectively, in excess of the FDIC insurance limit. |
Accounts Receivable, Notes Receivable and Concentration of Credit Risk | Accounts Receivable, Notes Receivable and Concentration of Credit Risk Accounts receivable are stated at the amount the Company expects to collect from balances outstanding at period-end, based on the Company's assessment of the credit history with customers having outstanding balances and current relationships with them. A reserve for uncollectable receivables is established when collection of amounts due is deemed improbable. Indicators of improbable collection include client bankruptcy, client litigation, client cash flow difficulties or ongoing service or billing disputes. Credit is generally extended on a short-term basis thus receivables do not bear interest. Interest on past due balances are subject to an interest charge of 1.5% per month. At December 31, 2020 and 2019, the Company established an allowance for doubtful accounts of $192,193 and $291,372, respectively. Notes receivable are stated at the amount the Company expects to collect from balances outstanding at period-end, based on the Company's assessment of the credit history with customers having outstanding balances and current relationships with them. A reserve for uncollectable receivables is established when collection of amounts due is deemed improbable. Indicators of improbable collection include client bankruptcy, client litigation, client cash flow difficulties or ongoing service or billing disputes. A note is placed on non-accrual status when management determines, after considering economic and business conditions and collection efforts, that the note is impaired or collection of interest is doubtful. The accrual of interest on the instrument ceases when there is concern that principal or interest due according to the note agreement will not be collected. Any payment received on such non-accrual notes are recorded as interest income when the payment is received. The note is reclassified as accrual-basis once interest and principal payments become current. The Company periodically reviews the value of the underlying collateral for the note receivable and evaluates whether the value of the collateral continues to provide adequate security for the note. Should the value of the underlying collateral become less than the outstanding principal and interest, the Company will determine whether an allowance is necessary. Any uncollectible interest previously accrued is also charged off. As of December 31, 2020, the Company believes the value of the underlying collateral for each of the notes to be sufficient and in excess of the respective outstanding principal and accrued interest, net of recognized allowance. Notes receivable, generally have terms of 12-18 months and bear interest from 9-12% per annum. Generally, product sales that are the basis for the note receivable are collateral on the note receivable until the note is paid off. At December 31, 2020 and 2019, the Company established an allowance for doubtful accounts of $292,050 and $0, respectively. We are exposed to credit risk in the normal course of business, primarily related to accounts and notes receivable. We are affected by general economic conditions in the United States. To limit credit risk, management periodically reviews and evaluates the financial condition of its customers and maintains an allowance for doubtful accounts. As of December 31, 2020 and 2019, we do not believe that we have significant credit risk. |
Inventory | Inventory Inventory consists primarily of gardening supplies and materials and is recorded at the lower of cost (weighted average cost method) or net realizable value. The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions. Write-downs and write-offs are charged to cost of goods sold. |
Property and Equipment | Property and Equipment Property and equipment are carried at cost. Leasehold improvements are amortized using the straight-line method over the original term of the lease or the useful life of the improvement, whichever is shorter. Renewals and betterment that materially extend the life of the asset are capitalized. Expenditures for maintenance and repairs are charged against operations. Depreciation of property and equipment is provided on the straight-line method for financial reporting purposes at rates based on the following estimated useful lives: Estimated Lives Vehicle 5 years Building 20 years Furniture and fixtures 5-7 years Computers and equipment 3-5 years Leasehold improvements 10 years not to exceed lease term |
Software and Website Development Costs | Software and Website Development Costs The Company accounts for the costs of computer software obtained or developed for internal use in accordance with FASB ASC 350, Intangibles — Goodwill and Other ● The Company expenses costs incurred in the preliminary project and post-implementation stages of software development and capitalizes costs incurred in the application development stage and costs associated with significant enhancements to existing internal use software applications. ● Software costs are amortized using the straight-line method over an estimated useful life of three years commencing when the software project is ready for its intended use. ● Costs incurred related to less significant modifications and enhancements as well as maintenance are expensed as incurred. As of December 31, 2020 and 2019, capitalized software cost were $1,162,603 and $138,280, respectively, before accumulated amortization of $221,885 and $5,000, respectively. |
Intangible Assets Acquired in Business Combinations | Intangible Assets Acquired in Business Combinations The Company values assets acquired and liabilities assumed on each acquisition accounted for as a business combination, and allocates the purchase price to the tangible and intangible assets acquired and liabilities assumed based on its best estimate of fair value. Acquired intangible assets include, trade names, customer relationships, non-compete agreements. The Company determines the appropriate useful life of intangible assets by performing an analysis of cash flows based on historical experience of the acquired businesses. Intangible assets are amortized over their estimated useful lives based on the pattern in which the economic benefits associated with the asset are expected to be consumed, which to date has approximated the straight-line method of amortization. The estimated useful lives for trade names, customer relationships, non-compete agreements are generally, five to six years. |
Goodwill | Goodwill Goodwill represents the excess of purchase price over the fair value of net assets. Goodwill is not amortized but is reviewed for potential impairment on an annual basis, or if events or circumstances indicate a potential impairment, at the reporting unit level. The Company’s review for impairment includes an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill, the first step of the two-step quantitative goodwill impairment test is performed, which compares the fair value of the reporting unit with its carrying amounts, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. However, if the carrying amount of the reporting unit exceeds its fair value, additional procedures must be performed. That additional procedure compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. An impairment loss is recorded to the extent that the carrying amount of goodwill exceeds its implied fair value. |
Leases | Leases We account for leases in accordance with the FASB ASC 842, Leases. We assess whether an arrangement is a lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We have elected the practical expedient to not separate lease and non-lease components for all assets. Operating lease assets and operating lease liabilities are calculated based on the present value of the future minimum lease payments over the lease term at the lease start date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the lease start date in determining the present value of future payments. The operating lease asset is increased by any lease payments made at or before the lease start date and reduced by lease incentives and initial direct costs incurred. The lease term includes options to renew or terminate the lease when it is reasonably certain that we will exercise that option. The exercise of lease renewal options is at our sole discretion. The depreciable life of lease assets and leasehold improvements are limited by the lease term. Lease expense for operating leases is recognized on a straight-line basis over the lease term. |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: ● Level 1—Quoted prices in active markets for identical assets or liabilities. ● Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. ● Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and all other current liabilities approximate fair values due to their short-term nature. The fair value of notes receivable approximates the outstanding balance and are reviewed for impairment at least annually. The fair value of impaired notes receivable are determined based on estimated future payments discounted back to present value using the notes effective interest rate. Level December 31, 2020 December 31, 2019 Cash equivalents 2 $ 163,418,055 - Notes receivable 2 2,937,499 1,501,288 Notes receivable impaired 3 874,378 - Accounts receivable 2 3,900,519 2,953,921 For the Level 3 assets measured at fair value on a non-recurring base at December 31, 2020, the significant unobservable inputs include the notes receivable effective interest rate of 10%. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with FASB ASC 740, Income Taxes, which requires the recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. In 2019 and as of September 30, 2020, a valuation allowance was provided for the amount of deferred tax assets that would otherwise be recorded for income tax benefits primarily relating to operating loss carryforwards as realization could not be determined to be more likely than not. The Company adopted the provisions of FASB ASC 740-10-25, which prescribes a recognition threshold and measurement attribute for the recognition and measurement of tax positions taken or expected to be taken in income tax returns. FASB ASC 740-10-25 also provides guidance on recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions. The Company's tax returns are subject to tax examinations by U.S. federal and state authorities until their respective statute of limitation. Currently, the 2019, 2018 and 2017 tax years are open and subject to examination by taxing authorities. However, the Company is not currently under audit nor has the Company been contacted by any of the taxing authorities. The Company does not have any accrual for uncertain tax positions as of December 31, 2020. |
Advertising | Advertising The Company expenses advertising and promotional costs when incurred. Advertising and promotional expenses for the years ended December 31, 2020 and 2019 amounted to $996,420 and $736,656, respectively. |
Earnings Per Share | Earnings Per Share The Company computes net earnings per share under Accounting Standards Codification subtopic 260-10, Earnings Per Share The treasury stock method is used in calculating diluted EPS for potentially dilutive stock options, restricted stock and share purchase warrants, which assumes that any proceeds received from the exercise of in-the-money stock options, restricted stock and share purchase warrants, would be used to purchase common shares at the average market price for the period. |
Stock Based Compensation | Stock Based Compensation The Company records stock-based compensation in accordance with FASB ASC Topic 718, Compensation-Stock Compensation The Black-Scholes option pricing model requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. The expected term of options granted is derived from historical data on employee exercises and post-vesting employment termination behavior. The risk-free rate selected to value any particular grant is based on the U.S. Treasury rate that corresponds to the expected life of the grant effective as of the date of the grant. The expected volatility is based on the historical volatility of the Company's stock price. These factors could change in the future, affecting the determination of stock-based compensation expense in future periods. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of useful lives for property and equipment | Estimated Lives Vehicle 5 years Building 20 years Furniture and fixtures 5-7 years Computers and equipment 3-5 years Leasehold improvements 10 years not to exceed lease term |
Schedule of fair value of impaired notes receivable | Level December 31, 2020 December 31, 2019 Cash equivalents 2 $ 163,418,055 - Notes receivable 2 2,937,499 1,501,288 Notes receivable impaired 3 874,378 - Accounts receivable 2 3,900,519 2,953,921 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue Recognition [Abstract] | |
Schedule of disaggregation of revenues | Year Ended Year Ended Sales at company owned stores $ 182,736,434 $ 74,969,830 E-commerce sales 10,629,045 4,763,738 Total Revenues $ 193,365,479 $ 79,733,568 |
Schedule of customer trade receivables and customer deposit liability | Receivables Customer Deposit Liability Opening balance, 1/1/2020 $ 4,455,209 $ 2,503,785 Closing balance, 12/31/2020 7,712,396 5,154,524 Increase (decrease) $ 3,257,1878 2,650,739 Opening balance, 1/1/2019 $ 862,397 $ 516,038 Closing balance, 12/31/2019 4,455,209 2,503,785 Increase (decrease) $ 3,592,812 $ 1,987,747 |
Schedule of long term trade receivables | December 31, 2020 December 31, 2019 Note receivable $ 4,103,927 $ 1,501,288 Allowance for losses (292,050 ) - Notes receivable, net $ 3,811,877 1,501,288 |
Schedule of notes receivable balances | December 31, December 31, Note receivable $ 1,166,428 $ 1,501,288 Allowance for loses (292,050 ) - Notes receivable, net $ 874,378 1,501,288 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | December 31, 2020 2019 Vehicle $ 1,342,127 $ 1,148,993 Building 477,280 - Leasehold improvements 1,987,991 884,685 Furniture, fixtures and equipment 5,738,798 2,858,777 9,546,196 4,892,455 Accumulated depreciation and amortization (3,071,066 ) (1,551,839 ) Property and equipment, net $ 6,475,130 $ 3,340,616 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets [Abstract] | |
Schedule of goodwill | December 31, December 31, Balance, beginning of period $ 17,798,932 $ 8,752,909 Goodwill additions 45,152,529 9,046,023 Impairments - - Balance, end of period $ 62,951,461 $ 17,798,932 |
Schedule of intangible assets | December 31, 2020 December 31, 2019 Gross Accumulated Gross Accumulated Tradenames $ 13,923,000 $ (398,567 ) $ - $ - Patents, trademarks 100,000 (9,051 ) 100,000 - Customer relationships 6,297,000 (137,814 ) - --- Non-competes 796,000 (21,743 ) - - Capitalized software 1,162,603 (221,884 ) 138,280 (5,000 ) $ 22,278,603 $ (789,059 ) $ 238,280 $ (5,000 ) |
Schedule of future amortization expense | Future amortization expense is as follows: 2021 $ 4,378,876 2022 4,396,281 2023 4,169,321 2024 4,069,439 2025 3,563,940 2026 911,687 Total $ 21,489,544 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision (benefit) for income taxes | Year Ended December 31, December 31, Income Tax Expense (benefit) Current federal tax expense Federal $ 1,732,230 $ 479,000 State 768,231 - Deferred tax (benefit) Federal $ 1,705,540 $ (479,000 ) State 226,590 - Valuation allowance (1,181,700 ) Total $ 3,250,891 $ - |
Schedule of deferred tax assets and liabilities | Year Ended December 31, December 31, Deferred tax assets: Net operating losses $ - $ 1,033,300 Deferred right to use lease liabilities 3,248,501 1,671,700 Stock based compensation 756,789 354,800 Inventory reserves 235,612 - Warranty reserves 146,472 - Accruals and other 180,345 160,200 4,567,719 3,220,000 Deferred tax liabilities: Deferred right to use lease assets (3,146,758 ) (1,678,300 ) Accumulated depreciation and amortization $ (2,171,391 ) $ (360,000 ) (5,318,149 ) 2,038,300 Gross deferred tax asset (liability) (750,430 ) 1,181,700 Valuation Allowance - (1,181,700 ) Deferred tax asset (liability), net $ (750,430 ) $ - |
Schedule of U.S. federal statutory income tax rate | Years Ended December 31, 2020 2019 Federal statutory tax rate 21 % 21 % State and local income taxes (net of federal tax benefit) 6 % 4 % 27 % 25 % Other 6 % - Non-deductible compensation 3 % - Incentive stock options 4 % Basis adjustments 12 % - Valuation allowance (14 )% (25 )% 38 % 0 % |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | December 31, 2020 2019 Long term debt is as follows: Wells Fargo Equipment Finance, interest at 3.5% per annum, payable in monthly installments of $518.96 beginning April 2016 through March 2021, secured by warehouse equipment with a book value of $25,437 $ 1,032 $ 7,109 Notes payable issued in connection with seller financing of assets acquired, interest at 1%, payable in 24 installments of $24,996, due and paid in full in February 2020 - 24,997 Notes payable issued in connection with seller financing of assets acquired, interest at 8.125%, payable in 60 installments of $8,440, due August 2023 239,832 320,204 $ 240,864 $ 352,310 Less Current Maturities (82,877 ) (110,231 ) Total Long-Term Debt $ 157,987 $ 242,079 |
Schedule of expected debt maturities | Debt maturities as of December 31, 2020 are as follows: 2021 $ 82,877 2022 99,184 2023 58,803 $ 240,864 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of lease balances within our condensed consolidated balance sheet | December 31, December 31, Right to use assets, operating lease assets $ 12,088,390 $ 7,628,591 Current lease liability $ 3,000,684 $ 1,836,700 Non-current lease liability 9,478,553 5,807,266 $ 12,479,237 $ 7,643,966 |
Schedule of other information related to leases | December 31, December 31, Weighted average remaining lease term 3.5 years 3.9 years Weighted average discount rate 7.6 % 7.6 % |
Schedule of operating lease assets | Year Ended December 31, 2020 2019 Operating lease costs $ 2,800,535 $ 1,914,161 Variable lease costs 1,071,089 525,292 Short-term lease costs 94,561 29,400 Total operating lease costs $ 3,966,185 $ 2,468,853 |
Schedule of future minimum rental payments | The following table presents the maturity of the Company's operating lease liabilities as of December 31, 2020: 2021 $ 4,118,220 2022 3,542,939 2023 3,025,729 2024 2,041,096 2025 1,676,619 Thereafter 2,379,935 Total lease payments 16,784,538 Less: Imputed interest (4,305,301 ) Lease Liability at December 31, 2020 $ 12,479,237 |
Share Based Payments (Tables)
Share Based Payments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of share-based payment expense | December 31, 2020 2019 Restricted stock $ 5,164,133 $ 1,419,323 Stock options 2,250,662 1,071,212 Warrants 441,368 - Total $ 7,856,163 $ 2,490,535 |
Schedule of restricted stock activity | Shares Weighted Average Grant Date Fair Value Nonvested, January 1, 2019 55,000 $ 3.35 Granted 353,500 2.50 Vested (201,000 ) 3.02 Forfeited (3,500 ) 5.91 Nonvested, December 31, 2019 204,000 $ 3.82 Granted 1,293,000 4.90 Vested (799,833 ) 5.16 Forfeited (66,667 ) 4.15 Nonvested, December 31, 2020 630,500 $ 4.51 |
Schedule of stock options | Awards issued under the 2014 Plan as of December 31, 2020 are summarized below: 2020 Total Shares available for issuance pursuant to the 2014 Plan 2,500,000 Options outstanding, December 31 2020 (50,000 ) Total options exercised under 2014 Plan (2,058,833 ) Total shares issued pursuant to the 2014 Plan (375,000 ) Awards available for issuance under the 2014 Plan, December 31, 2020 16,167 2020 Total Shares available for issuance pursuant to the 2018 Plan, as amended 5,000,000 Options outstanding, December 31 2020 (1,486,438 ) Total options exercised under 2018 Plan (438,895 ) Total shares issued pursuant to the 2018 Plan (1,112,979 ) Awards available for issuance under the 2018 Plan, December 31, 2020 1,961,688 |
Schedule of stock option expected rates | 2020 2019 Expected volatility 77.75-80.7 % 87.8%-92.7 % Expected dividends None None Expected term 2-5 years 2-5 years Risk-free rate 1.64-1.75 % 1.64 % |
Schedule of options outstanding pursuant | Options outstanding pursuant to 2014 Plan 50,000 Options outstanding pursuant to 2018 Plan 1,486,438 Options issued outside of 2014 and 2018 Plans 266,670 Total options outstanding December 31, 2020 1,803,108 |
Schedule of option outstanding | Options Shares Weighted- Weighted- Average Remaining Contractual Term Weighted- Outstanding at January 1, 2019 1,815,500 $ 1.66 2.65 years $ .78 Granted 795,000 $ 3.42 $ 2.31 Exercised (667,500 ) $ .72 $ .16 Forfeited or expired (17,667 ) $ 2.78 $ 1.49 Outstanding at December 31, 2019 1,925,333 $ 2.71 3.60 years $ 1.71 Vested and exercisable at December 31, 2019 1,346,333 $ 2.36 3.25 years $ 1.32 Outstanding at January 1, 2020 1,925,333 $ 2.71 3.60 years $ 1.71 Granted 891,500 $ 4.75 $ 2.67 Exercised (983,725 ) $ 2.59 $ 1.35 Forfeited or expired (30,000 ) $ 2.75 $ 1.63 Outstanding at December 31, 2020 1,803,108 $ 3.92 3.47 years $ 2.38 Vested and exercisable at December 31, 2020 1,057,734 $ 3.55 3.13 Years $ 2.00 |
Stock Purchase Warrants (Tables
Stock Purchase Warrants (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Warrants and Rights Note Disclosure [Abstract] | |
Schedule of outstanding stock warrants | Weighted Average Exercise Outstanding January 1, 2019 3,295,667 $ 1.94 Granted/issued 2,061,629 $ 3.50 Exercised (1,643,610 ) $ .79 Forfeited - Outstanding December 31, 2019 3,713,686 $ 3.25 Granted/issued 305,000 $ 24.66 Exercised (2,468,963 ) $ 3.05 Forfeited (250,000 ) 5.75 Outstanding December 31, 2020 1,299,723 $ 8.03 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of weighted average shares basic and dilutive earnings per share | Year Ended December 31, 2020 2019 Net income $ 5,328,378 $ 1,321,842 Weighted average shares outstanding, basic 43,944,879 32,833,594 Effect of dilutive outstanding warrants and stock options 2,511,370 1,076,560 Adjusted weighted average shares outstanding, dilutive 46,456,249 33,910,154 Basic income per shares $ .12 $ .04 Dilutive income per share $ .11 $ .04 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of purchase price | Canopy Grassroots GrowBiz BGT Hydro Depot Emerald H2O Health & Total Inventory $ 898,700 $ 2,348,200 $ 6,285,900 $ 1,595,000 $ 333,300 $ 150,000 $ 497,600 $ 1,053,900 $ 13,162,600 Prepaids and other current assets - - - - 4,600 - 4,600 Building - - - 477,300 - - - - 477,300 Furniture and equipment - 150,000 200,000 250,000 25,000 10,000 50,000 51,000 736,000 Operating lease right to use asset - 1,436,800 3,640,700 245,500 - - 902,000 192,600 6,417,600 Operating lease liability - (1,436,800 ) (3,640,700 ) (245,500 ) - - (902,000 ) (192,600 ) (6,417,600 ) Customer relationships 2,267,000 767,000 1,910,000 601,000 148,000 208,000 150,000 246,000 6,297,000 Trade name 1,138,000 2,138,000 7,745,000 2,025,000 212,000 - 234,000 431,000 13,923,000 Non-compete 113,000 133,000 374,000 94,000 19,000 14,000 43,000 6,000 796,000 Goodwill 4,822,900 4,464,000 28,271,400 4,001,600 798,500 620,000 1,007,700 1,065,600 45,051,700 Total $ 9,239,600 $ 10,000,200 $ 44,786,300 $ 9,043,900 $ 1,535,800 $ 1,000,000 $ 1,986,900 $ 2,853,500 $ 80,446,200 Canopy Grassroots GrowBiz BGT Hydro Depot Emerald H2O Health & Total Cash $ 5,423,600 $ 7,498,900 $ 17,486,900 $ 5,972,300 $ 987,500 $ 1,000,000 $ 1,281,700 $ 1,750,000 $ 41,400,900 Common stock 3,816,000 2,501,300 27,299,400 3,071,600 548,300 - 705,200 1,103,500 39,045,300 Total $ 9,239,600 $ 10,000,200 $ 44,786,300 $ 9,043,900 $ 1,535,800 $ 1,000,000 $ 1,986,900 $ 2,853,500 $ 80,446,200 Grow Grand Green Chlorophyll Reno Palm Total Inventory $ 553,900 $ 1,453,100 $ 1,038,600 $ 1,441,000 $ 238,000 $ 465,500 $ 5,190,100 Prepaids and other current assets - 14,100 22,000 - 36,100 Furniture and equipment 35,000 50,000 100,000 100,000 25,000 25,000 335,000 Goodwill 696,900 2,376,900 2,305,900 2,596,100 516,300 554,000 9,046,100 Total $ 1,285,800 $ 3,880,000 $ 3,458,600 $ 4,159,100 $ 779,300 $ 1,044,500 $ 14,607,300 Grow Grand Green Chlorophyll Reno Palm Total Cash $ 1,000,000 $ 2,350,000 $ 2,647,700 $ 3,659,100 $ 525,000 $ 800,000 $ 10,981,800 Common stock 285,800 1,530,000 810,900 500,000 254,300 244,500 3,625,500 Total $ 1,285,800 $ 3,880,000 $ 3,458,600 $ 4,159,100 $ 779,300 $ 1,044,500 $ 14,607,300 |
Schedule of revenue and earnings included in consolidated income statement | Canopy Grassroots GrowBiz BGT Hydro Depot Emerald H2O Health & Total Acquisition date 12/23/2020 12/14/2020 11/17/2020 10/20/2020 10/12/2020 8/10/2020 6/16/2020 2/26/2020 Revenue $ 300,500 $ 531,800 $ 3,852,100 $ 1,859,200 $ 1,244,600 $ 5,634,800 $ 2,418,100 $ 8,994,900 $ 24,836,000 Net Income $ 141,100 $ 74,400 $ 735,900 $ 187,800 $ 148,800 $ 1,005,000 $ 561,800 $ 1,065,600 $ 3,920,400 Grow Grand Green Chlorophyll Reno Palm Total Acquisition date 12/16/19 9/3/2019 5/14/2019 1/21/2019 2/11/2019 2/7/2019 Revenue $ 153,900 $ 2,412,700 $ 4,829,800 $ 6,030,500 $ 2,106,900 $ 3,075,300 $ 18,609,100 Earnings $ 6,400 $ 444,500 $ 998,700 $ 936,600 $ 366,742 $ 651,400 $ 3,404,342 |
Schedule of proforma consolidated income statement | December 31, December 31, Revenue $ 116,120,116 $ 71,649,931 Net income $ 12,979,881 $ 689,728 December 31, December 31, Revenue $ 31,300,425 $ 59,650,900 Earnings $ 4,750,591 $ (2,087,900 ) |
Correction of Error in Previo_2
Correction of Error in Previously Reported Consolidated Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Correction of Error in Previously Reported Consolidated Financial Statements [Abstract] | |
Schedule of revised consolidated financial statements | December 31, 2019 As Previously Reported Adjustment Revised ASSETS Current assets: Cash and cash equivalents $ 12,979,444 $ 12,979,444 Accounts receivable, net 2,953,921 2,953,921 Notes receivable, net 1,037,541 1,037,541 Inventory 22,659,357 (1,082,748 ) 21,576,609 Prepaids and other current assets 2,549,559 2,549,559 Total current assets 42,171,822 41,097,074 Property and equipment, net 3,340,616 3,340,616 Operating leases right-of-use assets, net 7,628,591 7,628,591 Notes receivable 463,747 463,747 Intangible assets, net 233,280 233,280 Goodwill 17,798,932 17,798,932 Other assets 377,364 377,364 TOTAL ASSETS $ 72,022,352 $ 70,939,604 LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 6,024,750 6,024,750 Payroll and payroll tax liabilities 1,072,142 1,072,142 Customer deposits 2,503,785 2,503,785 Sales tax payable 533,656 533,656 Current maturities of right-of-use assets 1,836,700 1,836,700 Current portion of long-term debt 110,231 110,231 Total current liabilities 12,081,264 12,081,264 Operating leases right-of-use assets, net of current maturities 5,807,266 5,807,266 Long-term debt, net of current portion 242,079 242,079 Total liabilities 18,130,609 18,130,609 Stockholders' Equity: Common stock; $.001 par value; 100,000,000 shares 36,876,305 shares issued and outstanding as of December 31, 2019 36,876 36,876 Additional paid-in capital 60,742,055 60,742,055 Accumulated deficit (6,887,188 ) (1,082,748 ) (7,969,936 ) Total stockholders' equity 53,891,743 52,808,995 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 72,022,352 $ 70,939,604 Year Ended December 31, 2019 As Previously Reported Adjustment Revised Sales $ 79,733,568 $ 79,733,568 Cost of sales 57,171,721 556,962 57,728,683 Gross profit 22,561,847 22,004,885 Operating expenses: Store operations 10,095,422 10,095,422 General and administrative 3,172,019 3,172,019 Share based compensation 2,490,535 2,490,535 Depreciation and amortization 1,044,553 1,044,553 Salaries and related expenses 3,619,197 3,619,197 Total operating expenses 20,421,726 20,421,726 Net income from operations 2,140,121 1,583,159 Other income (expense): Miscellaneous income (expense) (4,545 ) (4,545 ) Interest income 144,725 144,725 Interest expense (401,497 ) (401,497 ) Total non-operating income (expense), net (261,317 ) (261,317 ) Net income before taxes 1,878,804 1,321,842 Provision for income taxes 0 0 Net income $ 1,878,804 1,321,842 Net income per share, basic $ 0.06 $ 0.04 Net income per share, diluted $ 0.06 $ 0.04 Weighted average shares outstanding, basic 32,833,594 32,833,594 Weighted average shares outstanding, diluted 33,910,154 33,910,154 For The Year Ended December 31, 2019 Cash Flows from Operating Activities: As Previously Reported Adjustment Revised Net income $ 1,878,804 (556,962 ) $ 1,321,842 Adjustments to reconcile net income to net cash used in operating Activities: - Depreciation and amortization 1,044,553 1,044,553 Provision for doubtful accounts receivable 172,135 172,135 Inventory valuation reserve 429,126 429,126 Amortization of debt discount 356,306 356,306 Stock based compensation 2,490,535 2,490,535 Other (66,536 ) (66,536 ) Changes in operating assets and liabilities: - (Increase) decrease in: - Accounts receivable (3,764,947 ) (3,764,947 ) Inventory (10,482,014 ) 556,962 (9,925,052 ) Prepaid expenses and other assets (2,061,701 ) (2,061,701 ) Increase (decrease) in: - Accounts payable and accrued liabilities 4,165,188 4,165,188 Operating leases 15,375 15,375 Customer deposits 1,987,747 1,987,747 Income taxes - - Payroll and payroll tax liabilities 154,471 154,471 Sales taxes payable 341,698 341,698 Net Cash and Cash Equivalents (Used In) Operating Activities (3,339,260 ) (3,339,260 ) Cash Flows from Investing Activities: Assets acquired in business combinations (9,458,743 ) (9,458,743 ) Purchase of property and equipment (2,232,812 ) (2,232,812 ) Purchase of goodwill and other intangibles (119,125 ) (119,125 ) Net Cash and Cash Equivalents (Used In) Investing Activities (11,810,680 ) (11,810,680 ) Cash Flows from Financing Activities: Principal payments on long term debt (460,129 ) (460,129 ) Stock redemptions - - Proceeds from the sales of common stock and exercise of warrants and options, net of expenses 13,949,532 13,949,532 Net Cash and Cash Equivalents Provided by Financing Activities 13,489,403 13,489,403 Net Increase(decrease) in Cash and Cash Equivalents (1,660,537 ) (1,660,537 ) Cash and Cash Equivalents at Beginning of year 14,639,981 14,639,981 Cash and Cash Equivalents at End of year $ 12,979,444 $ 12,979,444 |
Nature of Operations (Details)
Nature of Operations (Details) | 12 Months Ended |
Dec. 31, 2020Store | |
Nature of Operations (Textual) | |
Number of stores | 52 |
Retail outlets, description | GrowGeneration is the largest chain of hydroponic garden centers in North America and is a leading marketer and distributor of nutrients, growing media, advanced indoor and greenhouse lighting, ventilation systems and accessories for hydroponic gardening. Currently, the Company owns and operates a chain of fifty two (52) retail hydroponic/gardening stores across 12 states, with eighteen (18) in the state of California, six (6) in the state of Michigan, eight (8) located in the state of Colorado, five (5) in the State of Oklahoma, five (5) in Maine, two (2) in the state of Nevada, two (2) in the state of Washington, two (2) in the state of Oregon, one (1) in the state of Rhode Island, one (1) in the state of Florida, one (1) in the state of Massachusetts, one (1) in the state of Arizona, an online e-commerce store, GrowGeneration.com and a commercial e-commerce platform, Agron.io Our plan is to continue to acquire, open and operate hydroponic/gardening stores and related businesses throughout the United States and Canada. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Vehicle [Member] | |
Property and equipment, estimated lives | 5 years |
Building [Member] | |
Property and equipment, estimated lives | 20 years |
Furniture and fixtures [Member] | Minimum [Member] | |
Property and equipment, estimated lives | 5 years |
Furniture and fixtures [Member] | Maximum [Member] | |
Property and equipment, estimated lives | 7 years |
Computers and equipment [Member] | Minimum [Member] | |
Property and equipment, estimated lives | 3 years |
Computers and equipment [Member] | Maximum [Member] | |
Property and equipment, estimated lives | 5 years |
Leasehold Improvements [Member] | |
Property and equipment, estimated lives | 10 years not to exceed lease term |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Summary Of Significant Accounting Policies | ||
Cash equivalents | $ 163,418,055 | |
Notes receivable | 2,937,499 | 1,501,288 |
Fair Value Notes receivable impaired | 874,378 | |
Accounts receivable | $ 3,900,519 | $ 2,953,921 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Basis of Presentation and Summary of Significant Accounting Policies (Textual) | ||
Leases initial term | 12 months | |
Allowance for doubtful accounts | $ 192,193 | $ 291,372 |
Capitalized software cost | 1,162,603 | 138,280 |
Accumulated amortization | 221,885 | 5,000 |
Amount excess of FDIC insurance limit | 174,000,000 | |
Advertising and promotional expense | $ 996,420 | 736,656 |
Interest percentage | 1.50% | |
Notes Receivable [Member] | ||
Basis of Presentation and Summary of Significant Accounting Policies (Textual) | ||
Allowance for doubtful accounts | $ 292,050 | |
Interest percentage | 10.00% | |
Maximum [Member] | ||
Basis of Presentation and Summary of Significant Accounting Policies (Textual) | ||
FDIC insured amount | $ 250,000 | |
Amount excess of FDIC insurance limit | $ 11,000,000 | |
Maximum [Member] | Notes Receivable [Member] | ||
Basis of Presentation and Summary of Significant Accounting Policies (Textual) | ||
Leases initial term | 18 years | |
Interest percentage | 12.00% | |
Minimum [Member] | Notes Receivable [Member] | ||
Basis of Presentation and Summary of Significant Accounting Policies (Textual) | ||
Leases initial term | 12 years | |
Interest percentage | 9.00% |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Details) | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Recent Accounting Pronouncements (Textual) | |
Leases initial term | 12 months |
Operating lease assets and liabilities | $ 3,200,000 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Total Revenues | $ 193,365,479 | $ 79,733,568 |
Sales at company owned stores [Member] | ||
Total Revenues | 182,736,434 | 74,969,830 |
E-commerce sales [Member] | ||
Total Revenues | $ 10,629,045 | $ 4,763,738 |
Revenue Recognition (Details 1)
Revenue Recognition (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Increase (decrease) | $ 2,650,739 | $ 1,987,747 |
Customer Deposit Liability [Member] | ||
Opening balance | 2,503,785 | 516,038 |
Closing balance | 5,154,524 | 2,503,785 |
Increase (decrease) | 2,650,739 | 1,987,747 |
Receivables [Member] | ||
Opening balance | 4,455,209 | 862,397 |
Closing balance | 7,712,396 | 4,455,209 |
Increase (decrease) | $ 3,257,187 | $ 3,592,812 |
Revenue Recognition (Details 2)
Revenue Recognition (Details 2) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Allowance for losses | $ (192,193) | $ (291,372) |
Trade Accounts Receivables [Member] | ||
Note receivable | 4,103,927 | 1,501,288 |
Allowance for losses | (292,050) | |
Notes receivable, net | $ 3,811,877 | $ 1,501,288 |
Revenue Recognition (Details 3)
Revenue Recognition (Details 3) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Allowance for loses | $ (192,193) | $ (291,372) |
Notes Receivable [Member] | ||
Note receivable | 1,166,428 | 1,501,288 |
Allowance for loses | (292,050) | |
Notes receivable, net | $ 874,378 | $ 1,501,288 |
Revenue Recognition (Details Te
Revenue Recognition (Details Textual) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue Recognition (Textual) | |
Long term, description | Longer term financing arrangement at interest rates ranging from 9% to 12% with repayment terms ranging for 12 to 18 months. |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 9,546,196 | $ 4,892,455 |
(Accumulated depreciation) | (3,071,066) | (1,551,839) |
Property and equipment, net | 6,475,130 | 3,340,616 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,342,127 | 1,148,993 |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,987,991 | 884,685 |
Furniture, fixtures and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 5,738,798 | $ 2,858,777 |
Property and Equipment (Detai_2
Property and Equipment (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property and Equipment (Textual) | ||
Depreciation expense | $ 1,646,907 | $ 1,046,328 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets [Abstract] | ||
Balance, beginning of period | $ 17,798,932 | $ 8,752,909 |
Goodwill additions | 45,152,529 | 9,046,023 |
Impairments | ||
Balance, end of period | $ 62,951,461 | $ 17,798,932 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details 1) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Gross Carrying Amount | $ 22,278,603 | $ 238,280 |
Accumulated Amortization | (789,059) | (5,000) |
Tradenames [Member] | ||
Gross Carrying Amount | 13,923,000 | |
Accumulated Amortization | (398,567) | |
Patents, trademarks [Member] | ||
Gross Carrying Amount | 100,000 | 100,000 |
Accumulated Amortization | (9,051) | |
Customer relationships [Member] | ||
Gross Carrying Amount | 6,297,000 | |
Accumulated Amortization | (137,814) | |
Non-competes [Member] | ||
Gross Carrying Amount | 796,000 | |
Accumulated Amortization | (21,743) | |
Capitalized software [Member] | ||
Gross Carrying Amount | 1,162,603 | 138,280 |
Accumulated Amortization | $ (221,884) | $ (5,000) |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Details 2) | Dec. 31, 2020USD ($) |
Future amortization expense is as follows: | |
2021 | $ 4,378,876 |
2022 | 4,396,281 |
2023 | 4,169,321 |
2024 | 4,069,439 |
2025 | 3,563,940 |
2026 | 911,686 |
Total | $ 21,489,544 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets (Textual) | ||
Amortization expense | $ 789,058 | $ 5,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current federal tax expense | ||
Federal | $ 1,732,230 | $ 479,000 |
State | 768,231 | |
Deferred tax (benefit) | ||
Federal | 1,705,540 | (479,000) |
State | 226,590 | |
Valuation allowance | (1,181,700) | |
Total | $ 3,250,891 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating losses | $ 1,033,300 | |
Deferred right to use lease liabilities | 3,248,501 | 1,671,700 |
Stock based compensation | 756,789 | 354,800 |
Inventory reserves | 235,612 | |
Warranty reserves | 146,472 | |
Accruals and other | 180,345 | 160,200 |
Total Deferred Tax Asset | 4,567,719 | 3,220,000 |
Deferred tax liabilities: | ||
Deferred right to use lease assets | (3,146,758) | (1,678,300) |
Accumulated depreciation and amortization | (2,171,391) | (360,000) |
Total Deferred tax liabilities | (5,318,149) | 2,038,300 |
Gross deferred tax asset (liability) | (750,430) | 1,181,700 |
Valuation Allowance | (1,181,700) | |
Deferred tax asset (liability), net | $ (750,430) |
Income Taxes (Details 2)
Income Taxes (Details 2) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory tax rate | 21.00% | 21.00% |
State and local income taxes (net of federal tax benefit) | 6.00% | 4.00% |
Effective income tax rate reconciliation, percent, gross | 27.00% | 25.00% |
Other | 6.00% | |
Non-deductible compensation | 3.00% | |
Incentive stock options | 4.00% | |
Basis adjustments | 12.00% | |
Valuation allowance | (14.00%) | (25.00%) |
Effective income tax rate reconciliation, percent | 38.00% | 0.00% |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Long-Term Debt | $ 240,864 | $ 352,310 |
Less Current Maturities | (82,877) | (110,231) |
Total Long-Term Debt | 157,987 | 242,079 |
Wells Fargo Equipment Finance [Member] | ||
Debt Instrument [Line Items] | ||
Long-Term Debt | 1,032 | 7,109 |
Notes payable issued in connection with seller financing [Member] | ||
Debt Instrument [Line Items] | ||
Long-Term Debt | 24,997 | |
Notes payable issued in connection with seller financing one [Member] | ||
Debt Instrument [Line Items] | ||
Long-Term Debt | $ 239,832 | $ 320,204 |
Long-Term Debt (Details1)
Long-Term Debt (Details1) | Dec. 31, 2020USD ($) |
Long-term Debt | |
2021 | $ 82,877 |
2022 | 99,184 |
2023 | 58,803 |
Total | $ 240,864 |
Long-Term Debt (Details Textual
Long-Term Debt (Details Textual) | 12 Months Ended | |
Dec. 31, 2020USD ($)Installments | Dec. 31, 2019USD ($) | |
Long-Term Debt (Textual) | ||
Interest expense | $ 14,053 | $ 45,191 |
Wells Fargo Equipment Finance [Member] | ||
Long-Term Debt (Textual) | ||
Long term debt, monthly payment | $ 519 | |
Long term debt maturity date, description | Beginning April 2016 through March 2021. | |
Long-term debt, book value | $ 25,437 | |
Interest rate per annum | 3.50% | |
Notes payable issued in connection with seller financing [Member] | ||
Long-Term Debt (Textual) | ||
Long term debt, monthly payment | $ 24,996 | |
Long term debt maturity date, description | Due February 2020. | |
Interest rate per annum | 1.00% | |
Number of installments | Installments | 24 | |
Notes payable issued in connection with seller financing one [Member] | ||
Long-Term Debt (Textual) | ||
Long term debt, monthly payment | $ 8,440 | |
Long term debt maturity date, description | Due August 2023. | |
Interest rate per annum | 8.125% | |
Number of installments | Installments | 60 |
Leases (Details)
Leases (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Right to use assets, operating lease assets | $ 12,088,390 | $ 7,628,591 |
Current lease liability | 3,000,684 | 1,836,700 |
Non-current lease liability | 9,478,553 | 5,807,266 |
Total | $ 12,479,237 | $ 7,643,966 |
Leases (Details 1)
Leases (Details 1) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Weighted average remaining lease term | 3 years 6 months | 3 years 10 months 25 days |
Weighted average discount rate | 7.60% | 7.60% |
Leases (Details 2)
Leases (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating lease costs | $ 2,800,535 | $ 1,914,161 |
Variable lease costs | 1,071,089 | 525,292 |
Short-term lease costs | 94,561 | 29,400 |
Total operating lease costs | $ 3,966,185 | $ 2,468,853 |
Leases (Details 3)
Leases (Details 3) | Dec. 31, 2020USD ($) |
Leases [Abstract] | |
2021 | $ 4,118,220 |
2022 | 3,542,939 |
2023 | 3,025,729 |
2024 | 2,041,096 |
2025 | 1,676,619 |
Thereafter | 2,379,935 |
Total lease payments | 16,784,538 |
Less: Imputed interest | (4,305,301) |
Lease Liability at December 31, 2020 | $ 12,479,237 |
Leases (Details Textual)
Leases (Details Textual) | 12 Months Ended |
Dec. 31, 2020 | |
Leases (Textual) | |
Lease term, description | Short-term disclosures include only those leases with a term greater than one month and 12 months or less, and expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less, that do not include an option to purchase the underlying asset that we are reasonably certain to exercise, are not recorded on the balance sheet. |
Minimum [Member] | |
Leases (Textual) | |
Remaining leases terms | 1 year |
Extend the leases for additional terms | 3 years |
Maximum [Member] | |
Leases (Textual) | |
Remaining leases terms | 10 years |
Extend the leases for additional terms | 5 years |
Convertible Debt (Details)
Convertible Debt (Details) - USD ($) | Jan. 12, 2018 | Dec. 31, 2020 | Dec. 31, 2019 |
Convertible Debt (Textual) | |||
Common stock, par value | $ 0.001 | $ 0.001 | |
Amortization of debt discount | $ 356,306 | ||
Convertible debt and accrued interest | $ 2,405,269 | ||
Warrants outstanding converted shares of common stock | 131,250 | ||
Conversion rate per shares | $ 3 | ||
Convertible Debt [Member] | |||
Convertible Debt (Textual) | |||
Maturity date | Jan. 12, 2021 | ||
Conversion price | $ 3 | ||
Description of convertible debt | Principal due and interest accrued on the notes will automatically convert into shares of common stock, at the conversion price, if at any time during the term of the notes, commencing twelve (12) months from the date of issuance, the common stock trades minimum daily volume of at least 50,000 shares for twenty (20) consecutive days with a volume weighted average price of at least $4.00 per share. | ||
Amortization of debt discount | $ 0 | ||
Net of unamortized debt discount | $ 674,581 | ||
Warrants outstanding converted shares of common stock | 93,750 | 1,258,608 | |
Private Placement [Member] | |||
Convertible Debt (Textual) | |||
Offering units of shares | 36 | ||
Securities unit price | $ 250,000 | ||
Principal amount | $ 250,000 | ||
Warrant term | 3 years | ||
Common stock, par value | $ 0.001 | ||
Warrants exercise price | $ 0.01 | ||
Description of convertible debt | Each Unit consisted of (i) a .1% unsecured convertible promissory note. | ||
Warrant holder to purchase shares | 37,500 |
Share Based Payments (Details)
Share Based Payments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Restricted stock | $ 5,164,133 | $ 1,419,323 |
Stock options | $ 2,250,662 | $ 1,071,212 |
Warrant expenses | 441,368 | |
Total | $ 7,856,163 | $ 2,490,535 |
Share Based Payments (Details 1
Share Based Payments (Details 1) - Restricted Stock [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Nonvested Shares, Beginning balance | 204,000 | 55,000 |
Nonvested Shares, Granted | 1,293,000 | 353,500 |
Nonvested Shares, Vested | (799,833) | (201,000) |
Nonvested Shares, Forfeited | (66,667) | (3,500) |
Nonvested Shares, Ending balance | 630,500 | 204,000 |
Weighted Average Grant Date Fair Value, Beginning balance | $ 3.82 | $ 3.35 |
Weighted Average Grant Date Fair Value, Granted | 4.90 | 2.50 |
Weighted Average Grant Date Fair Value, Vested | 5.16 | 3.02 |
Weighted Average Grant Date Fair Value, Forfeited | 4.15 | 5.91 |
Weighted Average Grant Date Fair Value, Ending balance | $ 4.51 | $ 3.82 |
Share Based Payments (Details 2
Share Based Payments (Details 2) | 12 Months Ended |
Dec. 31, 2020shares | |
2014 Plan [Member] | |
Total shares available for issuance | 2,500,000 |
Options outstanding, December 31 2020 | (50,000) |
Total options exercised | (2,058,833) |
Total shares issued pursuant | (375,000) |
Awards available for issuance | 16,167 |
2018 Plan [Member] | |
Total shares available for issuance | 5,000,000 |
Options outstanding, December 31 2020 | (1,486,438) |
Total options exercised | (438,895) |
Total shares issued pursuant | (1,112,979) |
Awards available for issuance | 1,961,688 |
Share Based Payments (Details 3
Share Based Payments (Details 3) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected dividends | ||
Risk-free rate | 1.64% | |
Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 77.75% | 87.80% |
Expected term | 2 years | 2 years |
Risk-free rate | 1.64% | |
Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 80.70% | 92.70% |
Expected term | 5 years | 5 years |
Risk-free rate | 1.75% |
Share Based Payments (Details 4
Share Based Payments (Details 4) | Dec. 31, 2020shares |
Share-based Payment Arrangement [Abstract] | |
Options outstanding pursuant to 2014 Plan | 50,000 |
Options outstanding pursuant to 2018 Plan | 1,486,438 |
Options issued outside of 2014 and 2018 Plans | 266,670 |
Total options outstanding December 31, 2020 | 1,803,108 |
Share Based Payments (Details 5
Share Based Payments (Details 5) - Options [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding, Shares | 1,925,333 | 1,815,500 |
Granted, Shares | 891,500 | 795,000 |
Exercised, Shares | (983,725) | (667,500) |
Forfeited or expired, Shares | (30,000) | (17,667) |
Outstanding, Shares | 1,803,108 | 1,925,333 |
Options Vested and exercisable , Shares | 1,057,734 | 1,346,333 |
Weighted - Average Exercise Price, Outstanding beginning balance | $ 2.71 | $ 1.66 |
Weighted - Average Exercise Price, Granted | 4.75 | 3.42 |
Weighted - Average Exercise Price, Exercised | 2.59 | 0.72 |
Weighted - Average Exercise Price, Forfeited or expired | 2.75 | 2.78 |
Weighted - Average Exercise Price, Outstanding ending balance | 3.92 | 2.71 |
Weighted - Average Exercise Price, Vested and exercisable | $ 3.55 | $ 2.36 |
Weighted - Average Remaining Contractual Term, Outstanding | 3 years 7 months 6 days | 2 years 7 months 24 days |
Weighted - Average Remaining Contractual Term, Outstanding Ending | 3 years 5 months 20 days | 3 years 7 months 6 days |
Weighted - Average Remaining Contractual Term, Vested and exercisable | 3 years 1 month 16 days | 3 years 2 months 30 days |
Weighted - Average Grant Date Fair Value, Outstanding beginning balance | $ 1.71 | $ 0.78 |
Weighted - Average Grant Date Fair Value, Granted | 2.67 | 2.31 |
Weighted - Average Grant Date Fair Value, Exercised | 1.35 | 0.16 |
Weighted - Average Grant Date Fair Value, Forfeited or expired | 1.63 | 1.49 |
Weighted - Average Grant Date Fair Value Outstanding ending balance | 2.38 | 1.71 |
Weighted - Average Grant Date Fair Value, Vested and exercisable | $ 2 | $ 1.32 |
Share Based Payments (Details T
Share Based Payments (Details Textual) - USD ($) | Mar. 06, 2014 | Dec. 31, 2020 | Feb. 07, 2018 |
Share Based Payments and Stock Options (Textual) | |||
Description of stock options | The maximum shares of common stock which may be issued over the term of the 2014 Plan shall not exceed 2,500,000 shares. Awards under the 2014 Plan are made by the Board or a committee designated by the Board. Options under the 2014 Plan are to be issued at the market price of the stock on the day of the grant except to those issued to holders of 10% or more of the Company's common stock which is required to be issued at a price not less than 110% of the fair market value on the day of the grant. Each option is exercisable at such time or times, during such period and for such numbers of shares shall be determined by the plan administrator. No option may be exercisable for more than ten years (five years in the case of an incentive stock option granted to a 10% stockholder) from the date of grant. | Awards may be made under the 2018 Plan on or after the ten-year anniversary of the adoption of the 2018 Plan by the Board, but the 2018 Plan will continue thereafter while previously granted options, stock appreciation rights or awards remain subject to the 2018 Plan. Options granted under the 2018 Plan may be either "incentive stock options" that are intended to meet the requirements of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code") or "nonstatutory stock options" that do not meet the requirements of Section 422 of the Code. The Board will determine the exercise price of options granted under the 2018 Plan. The exercise price of stock options may not be less than the fair market value, on the date of grant, per share of our Common Stock issuable upon exercise of the option (or 110% of fair market value in the case of incentive options granted to a 10% stockholder). No option may be exercisable for more than ten years (five years in the case of an incentive stock option granted to a 10% stockholder) from the date of grant. | |
Unamortized share-based compensation | $ 400,000 | ||
Sharebased Compensation weighted average period | 3 years | ||
Restricted Stock [Member] | |||
Share Based Payments and Stock Options (Textual) | |||
Unamortized share-based compensation | $ 3,700,000 | ||
Sharebased Compensation weighted average period | 2 years | ||
Minimum [Member] | |||
Share Based Payments and Stock Options (Textual) | |||
Stock issued over the term of the plan | 2,500,000 | ||
Maximum [Member] | |||
Share Based Payments and Stock Options (Textual) | |||
Stock issued over the term of the plan | 5,000,000 |
Stock Purchase Warrants (Detail
Stock Purchase Warrants (Details) - Warrants [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Warrants, Outstanding beginning balance shares | 3,713,686 | 3,295,667 |
Warrants, Granted/issued | 305,000 | 2,061,629 |
Warrants, Exercised | (2,468,963) | (1,643,610) |
Warrants, Forfeited | (250,000) | |
Warrants, Outstanding ending balance shares | 1,299,723 | 3,713,686 |
Weighted Average Exercise Price, Outstanding beginning balance | $ 3.25 | $ 1.94 |
Weighted Average Exercise Price, Granted/issued | 24.66 | 3.50 |
Weighted Average Exercise Price, Exercised | 3.05 | 0.79 |
Weighted Average Exercise Price, Forfeited | 5.75 | |
Weighted Average Exercise Price, Outstanding ending balance | $ 8.03 | $ 3.25 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Net income | $ 5,328,378 | $ 1,321,842 |
Weighted average shares outstanding, basic | 43,944,879 | 32,833,594 |
Effect of dilutive outstanding warrants and stock options | 2,511,370 | 1,076,560 |
Adjusted weighted average shares outstanding, dilutive | 46,456,249 | 33,910,154 |
Basic income per shares | $ 0.12 | $ 0.04 |
Dilutive income per share | $ 0.11 | $ 0.04 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Benefit Plan (Textual) | ||
Contributions plan | $ 169,327 | $ 83,158 |
Vendor Concentrations (Details)
Vendor Concentrations (Details) - Suppliers | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Vendor Concentrations (Textual) | ||
Concentration risk, percentage | 41.00% | 51.00% |
Number of suppliers | 2 | 2 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Business Acquisition [Line Items] | |||
Inventory | $ 13,162,600 | $ 5,190,100 | |
Prepaids and other current assets | 4,600 | 36,100 | |
Building | 477,300 | ||
Furniture and equipment | 736,000 | 335,000 | |
Operating leases right to use asset | 6,417,600 | ||
Operating lease liability | (6,417,600) | ||
Customer relationship | 45,051,700 | 9,046,100 | |
Trade name | 13,923,000 | ||
Non compete | 796,000 | ||
Goodwill | 62,951,461 | 17,798,932 | $ 8,752,909 |
Total | 79,968,900 | 14,607,300 | |
Cash | 41,400,900 | 10,981,800 | |
Common stock | 39,045,300 | 3,625,500 | |
Total | 80,446,200 | 14,607,300 | |
Canopy [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 898,700 | ||
Prepaids and other current assets | |||
Building | |||
Furniture and equipment | |||
Operating leases right to use asset | |||
Operating lease liability | |||
Customer relationship | 2,267,000 | ||
Trade name | 1,138,000 | ||
Non compete | 113,000 | ||
Goodwill | 4,822,900 | ||
Total | 9,239,600 | ||
Cash | 5,423,600 | ||
Common stock | 3,816,000 | ||
Total | 9,239,600 | ||
Grassroots [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 2,348,200 | ||
Prepaids and other current assets | |||
Building | |||
Furniture and equipment | 150,000 | ||
Operating leases right to use asset | 1,436,800 | ||
Operating lease liability | (1,436,800) | ||
Customer relationship | 767,000 | ||
Trade name | 2,138,000 | ||
Non compete | 133,000 | ||
Goodwill | 4,464,000 | ||
Total | 10,000,200 | ||
Cash | 7,498,900 | ||
Common stock | 2,501,300 | ||
Total | 10,000,200 | ||
GrowBiz [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 6,285,900 | ||
Building | |||
Furniture and equipment | 200,000 | ||
Operating leases right to use asset | 3,640,700 | ||
Operating lease liability | (3,640,700) | ||
Customer relationship | 1,910,000 | ||
Trade name | 7,745,000 | ||
Non compete | 374,000 | ||
Goodwill | 28,271,400 | ||
Total | 44,786,300 | ||
Cash | 17,486,900 | ||
Common stock | 27,299,400 | ||
Total | 44,786,300 | ||
BGT [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 1,595,000 | ||
Building | 477,300 | ||
Furniture and equipment | 250,000 | ||
Operating leases right to use asset | 245,500 | ||
Operating lease liability | (245,500) | ||
Customer relationship | 601,000 | ||
Trade name | 2,025,000 | ||
Non compete | 94,000 | ||
Goodwill | 4,001,600 | ||
Total | 8,566,600 | ||
Cash | 5,972,300 | ||
Common stock | 3,071,600 | ||
Total | 9,043,900 | ||
Hydro Depot [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 333,300 | ||
Prepaids and other current assets | |||
Building | |||
Furniture and equipment | 25,000 | ||
Operating leases right to use asset | |||
Operating lease liability | |||
Customer relationship | 148,000 | ||
Trade name | 212,000 | ||
Non compete | 19,000 | ||
Goodwill | 798,500 | ||
Total | 1,535,800 | ||
Cash | 987,500 | ||
Common stock | 548,300 | ||
Total | 1,535,800 | ||
Emerald City [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 150,000 | ||
Prepaids and other current assets | |||
Building | |||
Furniture and equipment | 10,000 | ||
Operating leases right to use asset | |||
Operating lease liability | |||
Customer relationship | 840,000 | ||
Trade name | |||
Non compete | 14,000 | ||
Goodwill | 620,000 | ||
Total | 1,000,000 | ||
Cash | 1,000,000 | ||
Common stock | |||
Total | 1,000,000 | ||
H2O Hydroponics LLC [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 497,600 | ||
Prepaids and other current assets | 4,600 | ||
Building | |||
Furniture and equipment | 50,000 | ||
Operating leases right to use asset | 902,000 | ||
Operating lease liability | (902,000) | ||
Customer relationship | 1,434,700 | ||
Trade name | 234,000 | ||
Non compete | 43,000 | ||
Goodwill | 1,007,700 | ||
Total | 1,986,900 | ||
Cash | 1,281,700 | ||
Common stock | 705,200 | ||
Total | 1,986,900 | ||
Health & Harvest LLC [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 1,053,900 | ||
Prepaids and other current assets | |||
Building | |||
Furniture and equipment | 50,000 | ||
Operating leases right to use asset | 192,600 | ||
Operating lease liability | (192,600) | ||
Customer relationship | 1,750,600 | ||
Trade name | 431,000 | ||
Non compete | 6,000 | ||
Goodwill | 1,065,600 | ||
Total | 2,851,500 | ||
Cash | 1,750,000 | ||
Common stock | 1,103,500 | ||
Total | $ 2,853,500 | ||
Grow World LLC [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 553,900 | ||
Prepaids and other current assets | |||
Furniture and equipment | 35,000 | ||
Customer relationship | 696,900 | ||
Total | 1,285,800 | ||
Cash | 1,000,000 | ||
Common stock | 285,800 | ||
Total | 1,285,800 | ||
Grand Rapids Hydro [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 1,453,100 | ||
Furniture and equipment | 50,000 | ||
Customer relationship | 2,376,900 | ||
Total | 3,880,000 | ||
Cash | 2,350,000 | ||
Common stock | 1,530,000 | ||
Total | 3,880,000 | ||
Green Life Garden [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 1,038,600 | ||
Prepaids and other current assets | 14,100 | ||
Furniture and equipment | 100,000 | ||
Customer relationship | 2,305,900 | ||
Total | 3,458,600 | ||
Cash | 2,647,700 | ||
Common stock | 810,900 | ||
Total | 3,458,600 | ||
Chlorophyll [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 1,441,000 | ||
Prepaids and other current assets | 22,000 | ||
Furniture and equipment | 100,000 | ||
Customer relationship | 2,596,100 | ||
Total | 4,159,100 | ||
Cash | 3,659,100 | ||
Common stock | 500,000 | ||
Total | 4,159,100 | ||
Reno Hydroponics [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 238,000 | ||
Prepaids and other current assets | |||
Furniture and equipment | 25,000 | ||
Customer relationship | 516,300 | ||
Total | 779,300 | ||
Cash | 525,000 | ||
Common stock | 254,300 | ||
Total | 779,300 | ||
Palm Springs Hydroponics [Member] | |||
Business Acquisition [Line Items] | |||
Inventory | 465,500 | ||
Furniture and equipment | 25,000 | ||
Customer relationship | 554,000 | ||
Total | 1,044,500 | ||
Cash | 800,000 | ||
Common stock | 244,500 | ||
Total | $ 1,044,500 |
Acquisitions (Details 1)
Acquisitions (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Business Acquisition [Line Items] | ||
Revenue | $ 24,836,000 | $ 18,609,100 |
Net income | $ 3,920,400 | $ 3,404,342 |
Canopy [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Dec. 23, 2020 | |
Revenue | $ 300,500 | |
Net income | $ 141,100 | |
Grassroots [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Dec. 14, 2020 | |
Revenue | $ 531,800 | |
Net income | $ 74,400 | |
GrowBiz [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Nov. 17, 2020 | |
Revenue | $ 3,852,100 | |
Net income | $ 735,900 | |
BGT [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Oct. 20, 2020 | |
Revenue | $ 1,859,200 | |
Net income | $ 187,800 | |
Hydro Depot [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Oct. 12, 2020 | |
Revenue | $ 1,244,600 | |
Net income | $ 148,800 | |
Emerald City [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Aug. 10, 2020 | |
Revenue | $ 5,634,800 | |
Net income | $ 1,005,000 | |
H2O Hydroponics LLC [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Jun. 16, 2020 | |
Revenue | $ 2,418,100 | |
Net income | $ 561,800 | |
Health & Harvest LLC [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Feb. 26, 2020 | |
Revenue | $ 8,994,900 | |
Net income | $ 1,065,600 | |
Grow World LLC [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Dec. 16, 2019 | |
Revenue | $ 153,900 | |
Net income | $ 6,400 | |
Grand Rapids Hydro [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Sep. 3, 2019 | |
Revenue | $ 2,412,700 | |
Net income | $ 444,500 | |
Green Life Garden Member [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | May 14, 2019 | |
Revenue | $ 4,829,800 | |
Net income | $ 998,700 | |
Chlorophyll [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Jan. 21, 2019 | |
Revenue | $ 6,030,500 | |
Net income | $ 936,600 | |
Reno Hydroponics [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Feb. 11, 2019 | |
Revenue | $ 2,106,900 | |
Net income | $ 366,742 | |
Palm Springs Hydroponics [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition date | Feb. 7, 2019 | |
Revenue | $ 3,075,300 | |
Net income | $ 651,400 |
Acquisitions (Details 2)
Acquisitions (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue | $ 116,120,116 | $ 71,649,931 |
Net income | 12,979,881 | 689,728 |
Consolidated [Member] | ||
Revenue | $ 59,650,900 | $ 31,300,425 |
Earnings | $ 4,750,591 | $ (2,087,900) |
Acquisitions (Details Textual)
Acquisitions (Details Textual) - USD ($) | Dec. 14, 2020 | Oct. 12, 2020 | Aug. 10, 2020 | Jun. 16, 2020 | Dec. 23, 2020 | Nov. 17, 2020 | Oct. 20, 2020 | Feb. 26, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Acquisitions (Textual) | ||||||||||
Acquired assets of health & harvest llc | $ 1,000,000 | $ 1,990,000 | $ 2,850,000 | |||||||
Acquired goodwill | $ 618,000 | $ 1,000,000 | $ 1,100,000 | |||||||
Cash | $ 163,418,055 | |||||||||
Hydroponics Depot, LLC [Member] | ||||||||||
Acquisitions (Textual) | ||||||||||
Cash | $ 987,500 | |||||||||
Common stock value | $ 548,000 | |||||||||
Big Green Tomato [Member] | ||||||||||
Acquisitions (Textual) | ||||||||||
Acquired goodwill | $ 4,000,000 | |||||||||
Cash | 5,495,000 | |||||||||
Common stock value | $ 3,100,000 | |||||||||
GrowBiz [Member] | ||||||||||
Acquisitions (Textual) | ||||||||||
Acquired goodwill | $ 28,300,000 | |||||||||
Cash | 17,400,000 | |||||||||
Common stock value | 27,300,000 | |||||||||
Consideration for purchase | $ 44,700,000 | |||||||||
Grassroots [Member] | ||||||||||
Acquisitions (Textual) | ||||||||||
Acquired goodwill | $ 4,500,000 | |||||||||
Cash | 7,500,000 | |||||||||
Common stock value | 2,500,000 | |||||||||
Consideration for purchase | $ 10,000,000 | |||||||||
Canopy [Member] | ||||||||||
Acquisitions (Textual) | ||||||||||
Acquired goodwill | $ 4,900,000 | |||||||||
Cash | 5,400,000 | |||||||||
Common stock value | 3,800,000 | |||||||||
Consideration for purchase | $ 9,200,000 |
Stockholders Equity (Details)
Stockholders Equity (Details) - USD ($) | Dec. 11, 2020 | Jul. 02, 2020 | Jun. 26, 2019 |
Stockholders Equity (Textual) | |||
Issued shares of common stock | 5,750,000 | 8,625,000 | |
Sale of stock per share | $ 30 | $ 5.60 | |
Gross proceeds | $ 172,500,000 | $ 48,300,000 | |
Net proceeds | $ 162,500,000 | $ 44,600,000 | |
Over-Allotment Option [Member] | |||
Stockholders Equity (Textual) | |||
Issued shares of common stock | 750,000 | 1,125,000 | |
Private Placement [Member] | |||
Stockholders Equity (Textual) | |||
Issued shares of common stock | 4,123,257 | ||
Sale of stock per share | $ 3.10 | ||
Private placement, description | (i) one share of Common Stock and (ii) one 3-year warrant, each entitling the holder to purchase one half share of Common Stock, at a price of $3.50 per share. The Company raised a total of $12,782,099 from 19 accredited investors. |
Correction of Error in Previo_3
Correction of Error in Previously Reported Consolidated Financial Statements (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | |||
Cash and cash equivalents | $ 177,911,511 | $ 12,979,444 | $ 14,639,981 |
Accounts receivable, net | 3,900,519 | 2,953,921 | |
Notes receivable, net | 2,612,134 | 1,037,541 | |
Inventory | 54,024,491 | 21,576,609 | |
Prepaids and other current assets | 11,124,752 | 2,549,559 | |
Total current assets | 250,228,660 | 41,097,074 | |
Property and equipment, net | 6,475,130 | 3,340,616 | |
Operating leases right-of-use assets, net | 12,088,390 | 7,628,591 | |
Notes receivable | 1,199,743 | 463,747 | |
Intangible assets, net | 21,489,544 | 233,280 | |
Goodwill | 62,951,461 | 17,798,932 | 8,752,909 |
Other assets | 300,767 | 377,364 | |
TOTAL ASSETS | 354,733,695 | 70,939,604 | |
Current liabilities: | |||
Accounts payable | 14,623,107 | 6,024,750 | |
Payroll and payroll tax liabilities | 2,655,427 | 1,072,142 | |
Customer deposits | 5,154,524 | 2,503,785 | |
Sales tax payable | 1,160,752 | 533,656 | |
Current maturities of right-of-use assets | 3,000,684 | 1,836,700 | |
Current portion of long-term debt | 82,877 | 110,231 | |
Total current liabilities | 27,349,474 | 12,081,264 | |
Operating leases right-of-use assets, net of current maturities | 9,478,553 | 5,807,266 | |
Long-term debt, net of current portion | 157,987 | 242,079 | |
Total liabilities | 37,736,444 | 18,130,609 | |
Stockholders' Equity: | |||
Common stock; $.001 par value; 100,000,000 shares 36,876,305 shares issued and outstanding as of December 31, 2019 | 57,152 | 36,876 | |
Additional paid-in capital | 319,581,657 | 60,742,055 | |
Accumulated deficit | (2,641,558) | (7,969,936) | |
Total stockholders' equity | 316,997,251 | 52,808,995 | 29,523,733 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 354,733,695 | 70,939,604 | |
As Previously Reported [Member] | |||
Current assets: | |||
Cash and cash equivalents | 12,979,444 | 14,639,981 | |
Accounts receivable, net | 2,953,921 | ||
Notes receivable, net | 1,037,541 | ||
Inventory | 22,659,357 | ||
Prepaids and other current assets | 2,549,559 | ||
Total current assets | 42,171,822 | ||
Property and equipment, net | 3,340,616 | ||
Operating leases right-of-use assets, net | 7,628,591 | ||
Notes receivable | 463,747 | ||
Intangible assets, net | 233,280 | ||
Goodwill | 17,798,932 | ||
Other assets | 377,364 | ||
TOTAL ASSETS | 72,022,352 | ||
Current liabilities: | |||
Accounts payable | 6,024,750 | ||
Payroll and payroll tax liabilities | 1,072,142 | ||
Customer deposits | 2,503,785 | ||
Sales tax payable | 533,656 | ||
Current maturities of right-of-use assets | 1,836,700 | ||
Current portion of long-term debt | 110,231 | ||
Total current liabilities | 12,081,264 | ||
Operating leases right-of-use assets, net of current maturities | 5,807,266 | ||
Long-term debt, net of current portion | 242,079 | ||
Total liabilities | 18,130,609 | ||
Stockholders' Equity: | |||
Common stock; $.001 par value; 100,000,000 shares 36,876,305 shares issued and outstanding as of December 31, 2019 | 36,876 | ||
Additional paid-in capital | 60,742,055 | ||
Accumulated deficit | (6,887,188) | ||
Total stockholders' equity | 53,891,743 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 72,022,352 | ||
Adjustment [Member] | |||
Current assets: | |||
Inventory | (1,082,748) | ||
Stockholders' Equity: | |||
Accumulated deficit | (1,082,748) | ||
Revised [Member] | |||
Current assets: | |||
Cash and cash equivalents | 12,979,444 | $ 14,639,981 | |
Accounts receivable, net | 2,953,921 | ||
Notes receivable, net | 1,037,541 | ||
Inventory | 21,576,609 | ||
Prepaids and other current assets | 2,549,559 | ||
Total current assets | 41,097,074 | ||
Property and equipment, net | 3,340,616 | ||
Operating leases right-of-use assets, net | 7,628,591 | ||
Notes receivable | 463,747 | ||
Intangible assets, net | 233,280 | ||
Goodwill | 17,798,932 | ||
Other assets | 377,364 | ||
TOTAL ASSETS | 70,939,604 | ||
Current liabilities: | |||
Accounts payable | 6,024,750 | ||
Payroll and payroll tax liabilities | 1,072,142 | ||
Customer deposits | 2,503,785 | ||
Sales tax payable | 533,656 | ||
Current maturities of right-of-use assets | 1,836,700 | ||
Current portion of long-term debt | 110,231 | ||
Total current liabilities | 12,081,264 | ||
Operating leases right-of-use assets, net of current maturities | 5,807,266 | ||
Long-term debt, net of current portion | 242,079 | ||
Total liabilities | 18,130,609 | ||
Stockholders' Equity: | |||
Common stock; $.001 par value; 100,000,000 shares 36,876,305 shares issued and outstanding as of December 31, 2019 | 36,876 | ||
Additional paid-in capital | 60,742,055 | ||
Accumulated deficit | (7,969,936) | ||
Total stockholders' equity | 52,808,995 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 70,939,604 |
Correction of Error in Previo_4
Correction of Error in Previously Reported Consolidated Financial Statements (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Sales | $ 193,365,479 | $ 79,733,568 |
Cost of sales | 142,317,178 | 57,728,683 |
Gross profit | 51,048,301 | 22,004,885 |
Operating expenses: | ||
Store operations | 18,723,794 | 10,095,422 |
General and administrative | 5,009,710 | 3,172,019 |
Share based compensation | 7,856,163 | 2,490,535 |
Depreciation and amortization | 2,435,965 | 1,044,553 |
Salaries and related expenses | 8,585,080 | 3,619,197 |
Total operating expenses | 42,610,712 | 20,421,726 |
Net income from operations | 8,437,589 | 1,583,159 |
Other income (expense): | ||
Miscellaneous income (expense) | 111,807 | (4,545) |
Interest income | 43,926 | 144,725 |
Interest expense | (14,053) | (401,497) |
Total non-operating income (expense), net | 141,680 | (261,317) |
Net income before taxes | 8,579,269 | 1,321,842 |
Provision for income taxes | (3,250,891) | |
Net income | $ 5,328,378 | $ 1,321,842 |
Net income per share, basic | $ 0.12 | $ 0.04 |
Net income per share, diluted | $ 0.11 | $ 0.04 |
Weighted average shares outstanding, basic | 43,944,879 | 32,833,594 |
Weighted average shares outstanding, diluted | 46,456,249 | 33,910,154 |
As Previously Reported [Member] | ||
Sales | $ 79,733,568 | |
Cost of sales | 57,171,721 | |
Gross profit | 22,561,847 | |
Operating expenses: | ||
Store operations | 10,095,422 | |
General and administrative | 3,172,019 | |
Share based compensation | 2,490,535 | |
Depreciation and amortization | 1,044,553 | |
Salaries and related expenses | 3,619,197 | |
Total operating expenses | 20,421,726 | |
Net income from operations | 2,140,121 | |
Other income (expense): | ||
Miscellaneous income (expense) | (4,545) | |
Interest income | 144,725 | |
Interest expense | (401,497) | |
Total non-operating income (expense), net | (261,317) | |
Net income before taxes | 1,878,804 | |
Provision for income taxes | 0 | |
Net income | $ 1,878,804 | |
Net income per share, basic | $ 0.06 | |
Net income per share, diluted | $ 0.06 | |
Weighted average shares outstanding, basic | 32,833,594 | |
Weighted average shares outstanding, diluted | 33,910,154 | |
Adjustment [Member] | ||
Cost of sales | $ 556,962 | |
Other income (expense): | ||
Net income | (556,962) | |
Revised [Member] | ||
Sales | 79,733,568 | |
Cost of sales | 57,728,683 | |
Gross profit | 22,004,885 | |
Operating expenses: | ||
Store operations | 10,095,422 | |
General and administrative | 3,172,019 | |
Share based compensation | 2,490,535 | |
Depreciation and amortization | 1,044,553 | |
Salaries and related expenses | 3,619,197 | |
Total operating expenses | 20,421,726 | |
Net income from operations | 1,583,159 | |
Other income (expense): | ||
Miscellaneous income (expense) | (4,545) | |
Interest income | 144,725 | |
Interest expense | (401,497) | |
Total non-operating income (expense), net | (261,317) | |
Net income before taxes | 1,321,842 | |
Provision for income taxes | 0 | |
Net income | $ 1,321,842 | |
Net income per share, basic | $ 0.04 | |
Net income per share, diluted | $ 0.04 | |
Weighted average shares outstanding, basic | 32,833,594 | |
Weighted average shares outstanding, diluted | 33,910,154 |
Correction of Error in Previo_5
Correction of Error in Previously Reported Consolidated Financial Statements (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income | $ 5,328,378 | $ 1,321,842 |
Adjustments to reconcile net income to net cash used in operating Activities: | ||
Depreciation and amortization | 2,435,965 | 1,044,553 |
Provision for doubtful accounts receivable | 213,503 | 172,135 |
Inventory valuation reserve | 4,390 | 429,126 |
Amortization of debt discount | 356,306 | |
Stock based compensation | 7,856,163 | 2,490,535 |
Other | (126,694) | (66,536) |
(Increase) decrease in: | ||
Accounts receivable | (3,470,690) | (3,764,947) |
Inventory | (19,192,401) | (9,925,052) |
Prepaid expenses and other assets | (9,237,416) | (2,061,701) |
Increase (decrease) in: | ||
Accounts payable and accrued liabilities | 9,987,990 | 4,165,188 |
Operating leases | 375,472 | 15,375 |
Customer deposits | 2,650,739 | 1,987,747 |
Payroll and payroll tax liabilities | 1,583,285 | 154,471 |
Sales taxes payable | 627,096 | 341,698 |
Net Cash and Cash Equivalents (Used In) Operating Activities | (213,790) | (3,339,260) |
Cash Flows from Investing Activities: | ||
Assets acquired in business combinations | (41,400,900) | (9,458,743) |
Purchase of property and equipment | (3,401,755) | (2,232,812) |
Purchase of goodwill and other intangibles | (1,027,548) | (119,125) |
Net Cash and Cash Equivalents (Used In) Investing Activities | (45,830,203) | (11,810,680) |
Cash Flows from Financing Activities: | ||
Principal payments on long term debt | (111,445) | (460,129) |
Stock redemptions | (118,785) | |
Proceeds from the sales of common stock and exercise of warrants and options, net of expenses | 211,206,290 | 13,949,532 |
Net Cash and Cash Equivalents Provided by Financing Activities | 210,976,060 | 13,489,403 |
Net Increase(decrease) in Cash and Cash Equivalents | 164,932,067 | (1,660,537) |
Cash and Cash Equivalents at Beginning of year | 12,979,444 | 14,639,981 |
Cash and Cash Equivalents at End of year | 177,911,511 | 12,979,444 |
As Previously Reported [Member] | ||
Cash Flows from Operating Activities: | ||
Net income | 1,878,804 | |
Adjustments to reconcile net income to net cash used in operating Activities: | ||
Depreciation and amortization | 1,044,553 | |
Provision for doubtful accounts receivable | 172,135 | |
Inventory valuation reserve | 429,126 | |
Amortization of debt discount | 356,306 | |
Stock based compensation | 2,490,535 | |
Other | (66,536) | |
(Increase) decrease in: | ||
Accounts receivable | (3,764,947) | |
Inventory | (10,482,014) | |
Prepaid expenses and other assets | (2,061,701) | |
Increase (decrease) in: | ||
Accounts payable and accrued liabilities | 4,165,188 | |
Operating leases | 15,375 | |
Customer deposits | 1,987,747 | |
Income taxes | ||
Payroll and payroll tax liabilities | 154,471 | |
Sales taxes payable | 341,698 | |
Net Cash and Cash Equivalents (Used In) Operating Activities | (3,339,260) | |
Cash Flows from Investing Activities: | ||
Assets acquired in business combinations | (9,458,743) | |
Purchase of property and equipment | (2,232,812) | |
Purchase of goodwill and other intangibles | (119,125) | |
Net Cash and Cash Equivalents (Used In) Investing Activities | (11,810,680) | |
Cash Flows from Financing Activities: | ||
Principal payments on long term debt | (460,129) | |
Stock redemptions | ||
Proceeds from the sales of common stock and exercise of warrants and options, net of expenses | 13,949,532 | |
Net Cash and Cash Equivalents Provided by Financing Activities | 13,489,403 | |
Net Increase(decrease) in Cash and Cash Equivalents | (1,660,537) | |
Cash and Cash Equivalents at Beginning of year | 12,979,444 | 14,639,981 |
Cash and Cash Equivalents at End of year | 12,979,444 | |
Adjustment [Member] | ||
Cash Flows from Operating Activities: | ||
Net income | (556,962) | |
(Increase) decrease in: | ||
Inventory | 556,962 | |
Revised [Member] | ||
Cash Flows from Operating Activities: | ||
Net income | 1,321,842 | |
Adjustments to reconcile net income to net cash used in operating Activities: | ||
Depreciation and amortization | 1,044,553 | |
Provision for doubtful accounts receivable | 172,135 | |
Inventory valuation reserve | 429,126 | |
Amortization of debt discount | 356,306 | |
Stock based compensation | 2,490,535 | |
Other | (66,536) | |
(Increase) decrease in: | ||
Accounts receivable | (3,764,947) | |
Inventory | (9,925,052) | |
Prepaid expenses and other assets | (2,061,701) | |
Increase (decrease) in: | ||
Accounts payable and accrued liabilities | 4,165,188 | |
Operating leases | 15,375 | |
Customer deposits | 1,987,747 | |
Income taxes | ||
Payroll and payroll tax liabilities | 154,471 | |
Sales taxes payable | 341,698 | |
Net Cash and Cash Equivalents (Used In) Operating Activities | (3,339,260) | |
Cash Flows from Investing Activities: | ||
Assets acquired in business combinations | (9,458,743) | |
Purchase of property and equipment | (2,232,812) | |
Purchase of goodwill and other intangibles | (119,125) | |
Net Cash and Cash Equivalents (Used In) Investing Activities | (11,810,680) | |
Cash Flows from Financing Activities: | ||
Principal payments on long term debt | (460,129) | |
Stock redemptions | ||
Proceeds from the sales of common stock and exercise of warrants and options, net of expenses | 13,949,532 | |
Net Cash and Cash Equivalents Provided by Financing Activities | 13,489,403 | |
Net Increase(decrease) in Cash and Cash Equivalents | (1,660,537) | |
Cash and Cash Equivalents at Beginning of year | $ 12,979,444 | 14,639,981 |
Cash and Cash Equivalents at End of year | $ 12,979,444 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Mar. 15, 2021 | Mar. 12, 2021 | Feb. 15, 2021 | Feb. 01, 2021 | Mar. 19, 2021 | Feb. 22, 2021 | Jan. 25, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 57,152 | $ 36,876 | |||||||
Cash value | $ 163,418,055 | ||||||||
Garden & Lighting [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 526,000 | ||||||||
Purchase of consideration, value | 1,650,000 | ||||||||
Cash value | $ 1,100,000 | ||||||||
Grow Depot Maine [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 411,000 | ||||||||
Purchase of consideration, value | 2,100,000 | ||||||||
Cash value | $ 1,700,000 | ||||||||
Grow Warehouse LLC [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 9,700,000 | ||||||||
Purchase of consideration, value | 17,800,000 | ||||||||
Cash value | $ 8,100,000 | ||||||||
San Diego Hydroponics & Organics [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 1,200,000 | $ 4,500,000 | |||||||
Purchase of consideration, value | 3,600,000 | 9,300,000 | |||||||
Cash value | 2,400,000 | $ 4,800,000 | |||||||
Charcoir Corporation [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 6,500,000 | ||||||||
Purchase of consideration, value | 16,300,000 | ||||||||
Cash value | $ 9,800,000 | ||||||||
Agron [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | $ 5,300,000 | ||||||||
Purchase of consideration, value | 11,300,000 | ||||||||
Cash value | $ 6,000,000 | ||||||||
55 Hydroponics [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Common stock valued | 1,100,000 | ||||||||
Purchase of consideration, value | 6,100,000 | ||||||||
Cash value | $ 5,000,000 |