Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 07, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | H/Cell Energy Corp | |
Entity Central Index Key | 1,676,580 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 7,586,024 | |
Trading Symbol | HCCC | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,018 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 331,236 | $ 455,700 |
Accounts receivable (net retention) | 1,230,621 | 808,050 |
Prepaid expenses | 23,282 | 14,669 |
Costs and earnings in excess of billings | 73,180 | 51,531 |
Total current assets | 1,658,319 | 1,329,950 |
Property and equipment, net | 362,933 | 102,573 |
Security deposits and other non-current assets | 20,711 | 8,416 |
Deferred tax asset | 44,257 | 44,257 |
Customer lists, net | 88,766 | |
Goodwill | 1,373,621 | |
Total assets | 3,548,607 | 1,485,196 |
Current liabilities | ||
Accounts payable and accrued expenses | 830,708 | 631,385 |
Management fees payable - related party | 31,257 | |
Earn-out payable | 186,346 | |
Billings in excess of costs and earnings | 51,798 | 87,206 |
Sales and withholding tax payable | 45,154 | 61,239 |
Current equipment notes payable | 32,538 | |
Current capital lease payable | 68,240 | |
Income tax payable | 26,197 | 98,313 |
Total current liabilities | 1,240,981 | 909,400 |
Noncurrent liabilities | ||
Note payable | 222,963 | |
Capital leases | 149,590 | |
Equipment notes payable | 118,606 | |
Convertible note payable - related party, net of discount | 14,268 | |
Total noncurrent liabilities | 505,427 | |
Total liabilities | 1,746,408 | 909,400 |
Commitments and contingencies | ||
Stockholders' equity | ||
Preferred stock - $0.0001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding | ||
Common stock - $0.0001 par value; 25,000,000 shares authorized; 7,586,024 and 7,041,579 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 758 | 704 |
Additional paid-in capital | 2,967,004 | 1,335,656 |
Accumulated deficit | (1,096,096) | (731,754) |
Accumulated other comprehensive loss | (69,467) | (28,810) |
Total stockholders' equity | 1,802,199 | 575,796 |
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ 3,548,607 | $ 1,485,196 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 7,586,024 | 7,041,579 |
Common stock, shares outstanding | 7,586,024 | 7,041,579 |
Condensed Consolidated Statemen
Condensed Consolidated Statement of Operations - Other Comprehensive Income - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue | ||||
Construction income | $ 1,830,992 | $ 1,292,905 | $ 5,535,352 | $ 5,050,155 |
Related party | 8,499 | 45,666 | 40,288 | 85,919 |
Total revenue | 1,839,491 | 1,338,571 | 5,575,640 | 5,136,074 |
Cost of goods sold | ||||
Direct costs | 1,438,669 | 870,369 | 3,901,125 | 3,432,098 |
Direct costs - related party | 9,019 | 37,304 | 40,636 | 87,649 |
Total cost of goods sold | 1,447,688 | 907,673 | 3,941,761 | 3,519,747 |
Gross profit | 391,803 | 430,898 | 1,633,879 | 1,616,327 |
Operating expenses | ||||
General and administrative expenses | 607,125 | 434,344 | 1,850,140 | 1,379,415 |
Management fees - related party | 19,500 | 46,000 | 58,500 | 138,000 |
Total operating expenses | 626,625 | 483,344 | 1,908,640 | 1,517,415 |
Income (loss) from operations | (234,822) | (52,446) | (274,761) | 98,912 |
Income tax provision (benefit) | ||||
Income (loss) before other income and expense | (234,822) | (52,446) | (274,761) | 98,912 |
Other expenses | ||||
Interest expense | 7,544 | 21,636 | ||
Interest expense - related party | 19,877 | 52,768 | ||
Change in fair value earn-out | 4,290 | 11,028 | ||
Loss on fixed asset disposal | 795 | 4,149 | ||
Total other expenses | 28,216 | 78,553 | ||
Net income (loss) | (267,328) | (52,446) | (364,342) | 98,912 |
Other comprehensive income (loss), net | ||||
Foreign currency translation adjustment | (7,828) | 5,928 | (40,657) | 24,345 |
Comprehensive income (loss) | $ (275,156) | $ (46,518) | $ (404,999) | $ 123,257 |
Earnings (loss) per share | ||||
Basic | $ (0.04) | $ (0.01) | $ (0.05) | $ 0.02 |
Diluted | $ (0.04) | $ (0.01) | $ (0.05) | $ 0.01 |
Weighted average common shares outstanding | ||||
Basic | 7,586,024 | 7,084,436 | 7,469,307 | 6,601,873 |
Diluted | 7,586,024 | 7,084,436 | 7,469,307 | 7,526,763 |
Statement of Stockholders' Equi
Statement of Stockholders' Equity - 9 months ended Sep. 30, 2018 - USD ($) | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Income (Deficit) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total |
Balance at Dec. 31, 2017 | $ 704 | $ 1,335,656 | $ (731,754) | $ (28,810) | $ 575,796 | |
Balance, shares at Dec. 31, 2017 | 7,041,579 | |||||
Issuance of common stock in February 2018, PVBJ Acquisition | $ 44 | 1,183,537 | 1,183,581 | |||
Issuance of common stock in February 2018, PVBJ Acquisition shares | 444,445 | |||||
Exercise of Stock Options | $ 10 | 990 | $ 1,000 | |||
Exercise of Stock Options, shares | 100,000 | 100,000 | ||||
Stock-based compensation expense | 51,821 | $ 51,821 | ||||
Beneficial conversion feature | 395,000 | 395,000 | ||||
Net loss | (364,342) | (40,657) | (404,999) | |||
Balance at Sep. 30, 2018 | $ 758 | $ 2,967,004 | $ (1,096,096) | $ (69,467) | $ 1,802,199 | |
Balance, shares at Sep. 30, 2018 | 7,586,024 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ (364,342) | $ 98,912 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Depreciation and amortization | 135,498 | 23,374 |
Stock-based compensation | 51,821 | 35,041 |
Loss on sale of assets | 4,149 | (77) |
Change in fair value contingent consideration | 11,028 | |
Change in operating assets and liabilities: | ||
Accounts and retainage receivable | (456,672) | (108,014) |
Prepaid expenses and other costs | (9,121) | 1,490 |
Costs in excess of billings | (26,786) | 82,431 |
Security deposits | (13,898) | |
Accounts payable and accrued expenses | 311,906 | (251,132) |
Billings in excess of costs | (30,246) | (2,576) |
Net cash used in operating activities | (386,663) | (120,551) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of fixed assets | (13,909) | (32,577) |
Cash acquired in business acquisition | 30,408 | |
Proceeds from disposition of property and equipment | 5,534 | 11,957 |
Net cash provided by (used in) investing activities | 22,033 | (20,620) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of convertible debt | 395,000 | |
Payments of related party interest | (36,000) | |
Repayments on capital leases | (42,123) | |
Repayments on notes payable | (36,229) | |
Proceeds from line of credit | 251,065 | |
Repayments on long-term debt | (225,903) | |
Proceeds related to stock option exercises | 1,000 | 1,000 |
Net cash provided by financing activities | 306,810 | 1,000 |
Net decrease in cash and cash equivalents | (57,820) | (140,171) |
Effect of foreign currency translation on cash | (66,644) | 23,375 |
Cash and cash equivalents, beginning of period | 455,700 | 537,867 |
Cash and cash equivalents, end of period | 331,236 | 421,071 |
Supplemental disclosure of non-cash investing and financing activities | ||
Common stock issued for acquisition of business | 1,177,779 | |
Fair value of net assets acquired in business combination | 2,056,344 | |
Beneficial conversion feature | $ 378,232 |
Organization and Line of Busine
Organization and Line of Business | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Line of Business | 1. ORGANIZATION AND LINE OF BUSINESS H/Cell Energy Corporation (the “Company”) was incorporated in the state of Nevada on August 17, 2015. The Company, based in Flemington, N.J., is a company whose principal operations consist of designing and installing clean energy systems with a focus on hydrogen energy. Effective January 31, 2017, the Company acquired The Pride Group (QLD) Pty Ltd, an Australian company (“Pride”) (see Note 11). Founded in 1997, Pride is a provider of security systems integration for a variety of customers in the government and commercial sector and has launched a new clean energy systems division to focus on the high growth renewable energy market in Asia-Pacific. The new clean energy division has generated some revenue and has begun to bid a number of projects. On February 1, 2018, the Company acquired PVBJ Inc. (“PVBJ”) for 444,445 shares of the Company’s common stock with a fair value of $1,177,779 and $221,800 in earn-out liability (see Note 12). Established in 2008, PVBJ is well recognized for the design, installation, maintenance and emergency service of environmental systems both in residential and commercial markets. PVBJ is now expanding into clean energy systems. The Company has developed a hydrogen energy system for residential and commercial use designed to create electricity. This unique system uses renewable energy as its source for hydrogen production. It functions as a self-sustaining clean energy system using hydrogen and fuel cell technology. It can be configured as an off grid solution for all electricity needs or it can be connected to the grid to generate energy credits. Its production of electricity is truly eco-friendly, as it is not produced by the use of fossil fuels. It is a revolutionary green-energy concept that is safe, renewable, self-sustaining and cost effective. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company’s condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and following the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results of be expected for the year ending December 31, 2018 or any other interim period or for any other future year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2017, included in the Company’s 2018 Annual Report on Form 10-K filed with the SEC. The balance sheet as of December 31, 2017 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Accounts Receivable Accounts receivable are recorded when invoices are issued and are presented in the balance sheet net of the allowance for doubtful accounts. The allowance for doubtful accounts is estimated based on the Company’s historical losses, the existing economic conditions in the construction industry, and the financial stability of its customers. Accounts are written off as uncollectible after collection efforts have failed. In addition, the Company does not generally charge interest on past-due accounts or require collateral. At September 30, 2018 and December 31 2017, there was no allowance for doubtful accounts required. Property and Equipment, and Depreciation Property and equipment are stated at cost. Depreciation is generally provided using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the remaining term of the lease or the estimated useful life of the improvement. Repairs and maintenance that do not improve or extend the lives of the property and equipment are charged to expense as incurred. Goodwill and Identifiable Intangible Assets Goodwill represents the excess of the aggregate of the following (1) consideration transferred, (2) the fair value of any non-controlling interest in the acquiree, and (3) if the business combination is achieved in stages, the acquisition-date fair value of our previously held equity interest in the acquiree over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. Identifiable intangible assets consist primarily of customer lists and relationships, non-compete agreements and technology based intangibles and other contractual agreements. The Company amortizes finite lived identifiable intangible assets over the shorter of their stated or statutory duration or their estimated useful lives, generally ranging from 3 to 15 years, on a straight-line basis to their estimated residual values and periodically reviews them for impairment. Total identifiable intangible assets comprised 41% of our consolidated total assets at September 30, 2018. There were no intangible assets or goodwill at December 31, 2017. The Company uses the acquisition method of accounting for all business combinations and does not amortize goodwill or intangible assets with indefinite useful lives. Goodwill and intangible assets with indefinite useful lives are tested for possible impairment annually during the fourth quarter of each fiscal year or more frequently if events or changes in circumstances indicate that the asset might be impaired. Comprehensive Income (Loss) Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss). The Company’s other comprehensive income (loss) is comprised of foreign currency translation adjustments. Advertising Costs Advertising costs are charged to expense during the period in which they are incurred. Advertising expense for the three months ended September 30, 2018 and 2017 was $1,144 and $336, respectively. For the nine months ended September 30, 2018 and 2017, advertising expense was $3,384 and $2,482, respectively. Foreign Currency Translation The Company translates its foreign subsidiary’s assets and liabilities denominated in foreign currencies into U.S. dollars at current rates of exchange as of the balance sheet date and income and expense items at the average exchange rate for the reporting period. Translation adjustments resulting from exchange rate fluctuations are recorded in accumulated other comprehensive income. The Company records gains and losses from changes in exchange rates on transactions denominated in currencies other than each reporting location’s functional currency in net income (loss) for each period . Revenue Recognition On January 1, 2018, the Company adopted ASU 2014-09, “Revenue from Contracts with Customers” (Topic 606) using the modified retrospective method applied to those contracts which were not completed as of December 31, 2017. Results for reporting periods beginning January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period. Under Topic 606 requirements, the Company recognizes revenue from the installation or construction of projects over time using the cost-based input method. The Company accounts for a contract when: (i) it has approval and commitment from both parties, (ii) the rights of the parties are identified, (iii) payment terms are identified, (iv) the contract has commercial substance, and (v) collectability of consideration is probable. The Company considers the start of a project to be when the above criteria have been met and the Company either has written authorization from the customer to proceed or an executed contract. The Company uses the total costs incurred on the project relative to the total expected costs to satisfy the performance obligation. The input method involves measuring the resources consumed, labor hours expended, costs incurred, time lapsed, or machine hours used relative to the total expected inputs to the satisfaction of the performance obligation. Costs incurred prior to actual contract (i.e. design, engineering, procurement of material, etc.) should not be recognized as the client does not have control of the good/service provided. When the estimate on a contract indicates a loss, or claims against costs incurred reduce the likelihood of recoverability of such costs, the Company records the entire estimated loss in the period the loss becomes known. Project contracts typically provide for a schedule of billings or invoices to the customer based on the Company’s job to date percentage of completion of specific tasks inherent in the fulfillment of its performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statement of operations can and usually does differ from amounts that can be billed or invoiced to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceed cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in the Company’s balance sheet under the captions “Costs and estimated earnings in excess of billings” and “Unbilled accounts receivable.” Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized on the contract are reflected as a current liability in the Company’s balance sheet under the caption “Billings in excess of costs and estimated earnings.” Revenue from service or short term contracts is recognized currently as the work is performed. Time and materials are accordingly charged to the customer at completion of the job. The Company recognizes service or short term contract revenues when there is persuasive evidence of an arrangement, delivery has occurred or services are rendered, the sales price is determinable, and collectability is reasonably assured. Revenue is typically recorded once all performance obligations have been satisfied. Sales are recorded net of discounts and returns, which historically have not been material. Cash and Cash Equivalents Cash and cash equivalents includes cash in bank and money market funds as well as other highly liquid investments with an original maturity of three months or less. The Company had no cash equivalents as of September 30, 2018 or December 31 2017. At times during the three and nine months ended September 30, 2018 and 2017, balances exceeded the FDIC insurance limit of $250,000. Stock-Based Compensation The Company recognizes expense for its stock-based compensation based on the fair value of the awards at the time they are granted. We estimate the value of stock option awards on the date of grant using the Black-Scholes model. The determination of the fair value of stock-based payment awards on the date of grant is affected by our stock price as well as assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, expected term, risk-free interest rate, expected dividends and expected forfeiture rates. The forfeiture rate is estimated using historical option cancellation information, adjusted for anticipated changes in expected exercise and employment termination behavior. Our outstanding awards do not contain market or performance conditions. Sales and Use Tax The Company collects sales tax in various jurisdictions. Upon collection from customers, it records the amount as a payable to the related jurisdiction. On a periodic basis, it files a sales tax return with the jurisdictions and remits the amount indicated on the return. Income Taxes The Company uses the asset and liability method of accounting for income taxes pursuant to FASB ASC 740, Income Taxes The determination of the Company’s provision for income taxes requires significant judgment, the use of estimates, and the interpretation and application of complex tax laws. Significant judgment is required in assessing the timing and amounts of deductible and taxable items and the probability of sustaining uncertain tax positions. The benefits of uncertain tax positions are recorded in the Company’s financial statements only after determining a more-likely-than-not probability that the uncertain tax positions will withstand challenge, if any, from taxing authorities. When facts and circumstances change, the Company reassesses these probabilities and records any changes in the financial statements as appropriate. Accrued interest and penalties related to income tax matters are classified as a component of income tax expense. The Company recognizes and measures its unrecognized tax benefits in accordance with ASC 740. Under that guidance, management assesses the likelihood that tax positions will be sustained upon examination based on the facts, circumstances and information, including the technical merits of those positions, available at the end of each period. The measurement of unrecognized tax benefits is adjusted when new information is available, or when an event occurs that requires a change. The Company did not identify any material uncertain tax positions. The Company did not recognize any interest or penalties for unrecognized tax benefits. The federal income tax returns of the Company are subject to examination by the IRS, generally for the three years after they are filed. The Company’s 2017, 2016 and 2015 income tax returns are still open for examination by the taxing authorities. Fair Value of Financial Instruments Except for the Company’s earn-out liability, the carrying value of cash and cash equivalents, accounts payable and accrued liabilities, and short-term borrowings, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. All other significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. Where practicable the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed. ● Level 1—quoted prices in active markets for identical assets and liabilities; ● Level 2—observable market based inputs or unobservable inputs that are corroborated by market data; and ● Level 3—significant unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The table below presents a reconciliation of the fair value of the Company’s contingent earn-out obligations that use significant unobservable inputs (Level 3). Balance at December 31, 2017 $ - Earn-out liability from acquisition of PVBJ Inc. 175,318 Payments - Adjustments to fair value 11,028 Balance at September 30, 2018 $ 186,346 The Company values earn-out obligations using a probability weighted discounted cash flow method. This fair value measurement is based on significant unobservable inputs in the market and thus represents a Level 3 measurement within the fair value hierarchy. This analysis reflects the contractual terms of the purchase agreements (e.g., minimum and maximum payments, length of earn-out periods, manner of calculating any amounts due, etc.) and utilizes assumptions with regard to future cash flows, probabilities of achieving such future cash flows and a discount rate. The contingent earn-out obligations are measured at fair value each reporting period and changes in estimates of fair value are recognized in earnings. Net Income (Loss) Per Common Share The Company computes basic net income (loss) per share by dividing net income (loss) per share available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods as applicable. The computation of diluted loss per share excludes dilutive securities for the nine months ended September 30, 2018 because their inclusion would be anti-dilutive. Potentially dilutive securities excluded from the computation of basic and diluted net loss per share for the three months ended September 30, 2018 and 2017 are as follows: September 30, 2018 September 30, 2017 Convertible debt 533,333 - Options to purchase common stock 980,000 1,050,000 Totals 1,513,333 1,050,000 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 3. RELATED PARTY TRANSACTIONS The Company’s current office space consists of approximately 800 square feet, which is donated to it from one of its executive officers. There is no lease agreement and the Company pays no rent. Effective February 4, 2016, the Company sold 526,316 shares of common stock to Reza Enterprises, Inc., an entity beneficially owned by Rezaul Karim. In connection with, and as a condition of closing, the Company agreed to appoint Rezaul Karim to its board of directors. Rezaul Karim resigned from the board of directors effective April 1, 2017. On April 1, 2017, the Company entered into a consulting agreement with Rezaul Karim for a period of one year. As such his function will be to promote our products and services. In each of April 2017 and 2018, Rezaul Karim exercised 100,000 options. In September 2016, the Company entered into a contract with Rezaul Karim, one of its former directors, for the installation of an HC-1 system. The system installation was complete pending any change orders as of September 30, 2018, and generated $31,789 and $85,919 of revenue for the nine months ended September 30, 2018 and 2017, respectively. The Company subcontracted the installation of the system to Renewable Energy Holdings LLC (“REH”), a company owned by Mike Strizki, one of the Company’s executive officers. James Strizki, one of the Company’s executive officers, is vice president of operations at REH. Costs incurred for REH were $31,617 and $87,649 for the nine months ended September 30, 2018 and 2017, respectively. No revenue or costs were incurred in the three months ended September 30, 2018. For the three months ended September 30, 2017, the Company incurred revenue of $45,666 and direct costs of $37,304. In September 2018, the Company entered into a contract with Steve Mullane, the Executive General Manager of Pride, for a solar installation. The system installation was complete as of September 30, 2018, however one change order of $686 will be deducted to the cost of the job amount in October 2018. Costs incurred were $9,019 along with revenue of $8,499 for each of the three and nine months ended September 30, 2018. The Company has entered into agreements to indemnify its directors and executive officers, in addition to the indemnification provided for in the Company’s articles of incorporation and bylaws. These agreements, among other things, provide for indemnification of the Company’s directors and executive officers for certain expenses (including attorneys’ fees), judgments, fines and settlement amounts incurred by any such person in any action or proceeding, including any action by or in the right of the Company, arising out of such person’s services as a director or executive officer of the Company, any subsidiary of the Company or any other company or enterprise to which the person provided services at the Company’s request. The Company believes that these provisions and agreements are necessary to attract and retain qualified persons as directors and executive officers. At September 30, 2018 and December 31, 2017, the balances due to Turquino Equity LLC (Turquino”), a significant shareholder, amounted to $0 and $31,257, respectively. These balances represent expenses for management services. There was $19,500 of management fees expensed for the three months ended September 30, 2018 and $58,500 for the nine months ended September 30, 2018. Management fees expensed totaled $47,000 for the three months ended September 30, 2017 and $138,000 for the nine months ended September 30, 2017. On January 2, 2018, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with two of its directors, pursuant to which the Company sold an aggregate principal amount of $400,000 in 12% Convertible Debentures (“Debentures”), convertible into shares of the Company’s common stock at a conversion price of $0.75 per share. The Debentures, together with any accrued and unpaid interest, become due and payable on January 2, 2020 (the “Maturity Date”). Interest on the Debentures accrues at the rate of 12% per annum, payable monthly in cash, beginning on February 1, 2018 and on the Maturity Date. The Debentures are convertible into common stock at a conversion price of $0.75 per share at the discretion of the holder, with special provisions applying to any holder whose conversion would result in the holder beneficially owning more than 4.99% of the Company’s common stock. In connection with this convertible note payable, the Company recorded a $395,000 discount on debt, related to the beneficial conversion feature of the note to be amortized over the life of the note using the effective interest method, or until the note is converted or repaid. |
Significant Concentrations of C
Significant Concentrations of Credit Risk | 9 Months Ended |
Sep. 30, 2018 | |
Risks and Uncertainties [Abstract] | |
Significant Concentrations of Credit Risk | 4. SIGNIFICANT CONCENTRATIONS OF CREDIT RISK Cash is maintained at an authorized deposit-taking institution (bank) incorporated in both the United States and Australia and is insured by the U.S. Federal Deposit Insurance Corporation and Australian Securities & Investments Commission up to $250,000 and approximately $186,000 USD in total, respectively. At September 30, 2018 and December 31 2017, the balances exceeded the insured limits by $81,236 and $145,236, respectively. Credit risk for trade accounts is concentrated as well because substantially all of the balances are receivable from entities located within certain geographic regions. To reduce credit risk, the Company performs ongoing credit evaluations of its customers’ financial conditions, but does not generally require collateral. In addition, at September 30, 2018, approximately 20% of the Company’s accounts receivable was due from two unrelated customers at 12% and 8%, respectively. At December 31, 2017, approximately 36% of the Company’s accounts receivable was due from three unrelated customers, 14%, 12% and 10%, respectively. |
Major Customers
Major Customers | 9 Months Ended |
Sep. 30, 2018 | |
Major Customers | |
Major Customers | 5. MAJOR CUSTOMERS There was one customer with a concentration of 10% or higher, at 20%, for the three months ended September 30, 2018, and three customers for the nine months ended September 30, 2018 at 16%, 14% and 11%, respectively. There was one customer with a concentration of 10% or higher of the Company’s revenue, at 19%, for the three months ended September 30, 2017, and two customers, at 29% and 14%, for the nine months ended September 30, 2017. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 6. PROPERTY AND EQUIPMENT At September 30, 2018 and December 31, 2017, property and equipment were comprised of the following: September 30, 2018 December 31, 2017 Furniture and fixtures (5 to 7 years) $ 12,803 $ 6,857 Machinery and equipment (5 to 7 years) 35,565 35,919 Computer and software (3 to 5 years) 120,621 94,761 Auto and truck (5 to 7 years) 783,310 250,044 Leasehold improvements (life of lease) 38,961 40,608 991,260 428,189 Less accumulated depreciation 628,327 325,616 $ 362,933 $ 102,573 Depreciation expense for the three months ended September 30, 2018 and 2017 was $29,105 and $8,454, respectively. Depreciation expense for the nine months ended September 30, 2018 and 2017 was $104,624 and $23,374, respectively. |
Uncompleted Contracts
Uncompleted Contracts | 9 Months Ended |
Sep. 30, 2018 | |
Contractors [Abstract] | |
Uncompleted Contracts | 7. UNCOMPLETED CONTRACTS Costs, estimated earnings and billings on uncompleted contracts are summarized as follows at September 30, 2018 and December 31, 2017: September 30, 2018 December 31, 2017 Costs incurred on uncompleted contracts $ 1,871,577 $ 2,485,787 Estimated earnings 550,409 779,598 Costs and estimated earnings on uncompleted contracts 2,421,896 3,265,385 Billings to date 2,467,054 3,553,817 Costs and estimated earnings in excess of billings on uncompleted contracts (45,068 ) (288,432 ) Costs and earnings in excess of billings on completed contracts (66,450 ) (252,757 ) $ 21,382 $ (35,675 ) Costs in excess of billings $ 73,180 $ 51,531 Billings in excess of cost (51,798 ) (87,206 ) $ 21,382 $ (35,675 ) |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | 8. COMMITMENTS The Company previously entered into two operating leases for office space in Woombye and Brisbane, Queensland, Australia, both which expired in April 2018. The Company signed a new lease in February of 2018 for new office space in Kunda Park Queensland Australia, starting in May 2018 and expiring in May 2021. The Company also renewed the Brisbane office space for one year starting in May 2018. The Company’s office in Downingtown, Pennsylvania was renewed in January of 2018 for a one-year period. The future minimum payments on the leases for each of the next three and one-half years and in the aggregate amount to the following: 2018 $ 23,979 2019 54,050 2020 39,639 2021 13,213 $ 130,881 Rent expense for the three months ended September 30, 2018 and 2017 was $22,582 and $23,500, respectively. Rent expense for the nine months ended September 30, 2018 and 2017 was $67,355 and $68,500, respectively, and is included in “General and Administrative” expenses on the related statements of operations. During the three and nine months September 30, 2018, the Company had vehicles leased under four capital leases, with a net book value of $159,226, which expire in September 2023. During the three and nine months ended September 30, 2017, the Company had no capital leases. The obligations are payable in monthly installments ranging from approximately $615 to $2,630 with interest rates from 5.57% to 7.20% per annum. The leases are secured by the related equipment. At September 30, 2018, approximate payments to be made on these capital lease obligations are as follows: 2018 $ 26,569 2019 78,209 2020 75,578 2021 44,718 2022 7,512 Thereafter 4,382 Capital lease obligation 236,968 Less: amounts representing interest 19,138 Current maturities of capital lease obligations 68,240 Capital lease obligations, non-current $ 149,590 For the three and nine months ended September 30, 2018, interest expense on the capital leases was $2,912 and $7,894, respectively. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | 9. DEBT Long-term debt consisted of the following: Equipment Notes Payable September 30, 2018 December 31, 2017 Note payable with monthly payments of $716, including interest at 6.50% per annum through November 2020. $ 20,235 $ - Note payable with monthly payments of $1,294.50, including interest at 14.72 per annum through March 2023. $ 56,080 $ - Note payable with monthly payments of $1,063.45, including interest at 5.76% per annum through April 2021 $ 21,120 $ - Note payable with monthly payments of $946.84 including interest at 6.14% per annum through December 2024. $ 53,709 $ - Total non-current portion: $ 151,144 $ - Total current portion: $ (32,538 ) $ - Total: $ 118,606 $ - Aggregate annual principal payments in the fiscal years subsequent to December 31 2017, are as follows: Year ending December 31: Amount 2018 (remaining) $ 8,506 2019 40,395 2020 39,679 2021 25,657 2022 22,584 Thereafter 37,377 Notes payable obligation 174,198 Less amounts representing interest (23,055 ) $ 151,144 Convertible Note Payable On January 2, 2018, the Company entered into an agreement with two related parties, who are directors of the Company and issued a 12.0% interest bearing convertible debenture for $400,000 due on January 2, 2020, with conversion features commencing immediately following the date of the note. Payments of interest only were due monthly beginning January 2018. The Debentures are convertible into common stock at a conversion price of $0.75 per share at the discretion of the holder, with special provisions applying to any holder whose conversion would result in the holder beneficially owning more than 4.99% of the Company’s common stock. In connection with this convertible note payable, the Company recorded a $395,000 discount on debt, related to the beneficial conversion feature of the note to be amortized over the life of the note using the effective interest method, or until the note is converted or repaid. The Company incurred $5,000 of legal fees for preparation of the financing documents, which has been reflected as an additional debt discount. For the three months ended September 30, 2018, the Company incurred interest expense of $19,877, of which $7,877 related to the amortization of the discount. For the nine months ended September 30, 2018, the Company incurred interest expense of $52,768, of which $14,268 related to the amortization of the discount. |
Contract Backlog
Contract Backlog | 9 Months Ended |
Sep. 30, 2018 | |
Contract Backlog | |
Contract Backlog | 10. CONTRACT BACKLOG At September 30, 2018, the Company had a contract backlog approximating $715,595 with anticipated direct costs to completion approximating $550,409. |
Acquisition Under Common Contro
Acquisition Under Common Control | 9 Months Ended |
Sep. 30, 2018 | |
Acquisition Under Common Control | |
Acquisition Under Common Control | 11. ACQUISITION UNDER COMMON CONTROL On January 31, 2017, the Company entered into a share exchange agreement (the “Exchange Agreement”) by and among the Company, Pride, Turquino and Stephen Paul Mullane and Marie Louise Mullane as Trustees of the Mullane Family Trust (the “Mullane Trust” and together with Turquino, the “Pride Shareholders”). Andrew Hidalgo and Matthew Hidalgo, the Company’s Chief Executive Officer and Chief Financial Officer, respectively, are each a managing partner of Turquino. Pursuant to the Exchange Agreement, the Company acquired all of the issued and outstanding capital stock of Pride from the Pride Shareholders in exchange for an aggregate of 3,800,000 shares of the Company’s common stock (the “Acquisition Shares”). As a result, the combination of the Company and Pride pursuant to the Exchange Agreement is considered a business combination of companies under common control and will be accounted for in a manner similar to a pooling-of-interests. The accompanying financial statements have been retrospectively restated as a result of an acquisition of another company under common control with the Company, which was completed in January 2017. |
Business Acquisition
Business Acquisition | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Business Acquisition | 12. BUSINESS ACQUISITION On February 1, 2018, the Company entered into a stock purchase agreement (the “Purchase Agreement”) by and among the Company, PVBJ and Benis Holdings LLC, the sole shareholder of PVBJ (“Benis Holdings”). Pursuant to the Purchase Agreement, the Company acquired all of the issued and outstanding capital stock of PVBJ from Benis Holdings for an aggregate amount equal to (i) $221,800 (the “Cash Purchase Price”) and (ii) 444,445 shares of the Company’s common stock, par value $.0001 per share having a fair value of $1,177,779 (the “Acquisition Shares”). Pursuant to the Purchase Agreement, the Acquisition Shares were issued at closing, and the earn-out will be paid to Benis Holdings from positive earnings before taxes of PVBJ, with Benis Holdings to receive 50% of annual earnings before taxes of PVBJ until such time as Benis Holdings has received the full Cash Purchase Price. In connection with the acquisition of PVBJ, the Company entered into an employment agreement (the “Employment Agreement”) with Paul V. Benis, Jr. to serve as an Executive Vice President of the Company for a period of three years. Pursuant to the Employment Agreement, Mr. Benis shall receive an annual salary of $150,000 and have oversight of the business operations of PVBJ. The preliminary estimated consideration transferred in the acquisition was as follows: Upfront consideration $ 1,177,779 Liabilities assumed 878,565 Total $ 2,056,343 The estimated fair values of working capital balances, property and equipment, identifiable intangible assets and goodwill are provisional and are based on the information that was available as of the acquisition date. The estimated fair values of these provisional items are based on certain valuation and other studies and are in progress and not yet at the point where there is sufficient information for a definitive measurement. The Company believes the preliminary information provides a reasonable basis for estimating the fair values of these amounts, but is waiting for additional information necessary to finalize those fair values. Therefore, provisional measurements of fair values reflected are subject to change and such changes could be significant. The Company expects to finalize the valuation of tangible assets and liabilities, identifiable intangible assets and goodwill, and complete the acquisition accounting as soon as practicable but no later than January 2, 2019. The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: Cash and cash equivalents $ 30,408 Accounts receivable 277,338 Property and equipment, net 272,554 Customer list 102,422 Goodwill 1,373,621 Total assets acquired 2,056,344 Accounts payable (112,590 ) Debt assumed (590,657 ) Earn-out liability (175,318 ) Total liabilities assumed (878,565 ) Total net assets acquired $ 1,177,779 The goodwill arising from the acquisition represents the expected synergistic benefits of the transaction, primarily related to lower future operating expenses and the knowledge and experience of the workforce in place. The goodwill is not deductible for income tax purposes. A summary of preliminary estimated identifiable intangible assets acquired, preliminary estimated useful lives and amortization method is as follows: Useful Life in Amount Years Amortization Method Customer List $ 102,422 5 Straight Line Total $ 102,422 The results of PVBJ’s operations are included in the condensed consolidated statements of operations beginning February 1, 2018. PVBJ’s net loss for three and eight month period ended September 30, 2018 totaled $84,343 and $61,341, respectively. The net loss includes estimated acquired intangible asset amortization of $5,121 for the three month period ended September 30, 2018 and $13,656 for the eight month period ended September 30, 2018. For the three and nine month period ended September 30, 2018, acquisition related costs for the Company totaled $29,500 and $44,500 and are included in general and administration expenses. The Company may incur additional acquisition related costs during 2018. Pro forma results for H/Cell Energy Corporation giving effect to the PVBJ Inc. acquisition The following pro forma financial information presents the combined results of operations of PVBJ Inc. and the Company for the three and nine month periods ended September 30, 2018 and 2017. The pro forma financial information presents the results as if the acquisition had occurred as of the beginning of 2017. The unaudited pro forma results presented include amortization charges for acquired intangible assets, interest expense and stock-based compensation expense. Pro forma financial information is presented for informational purposes and is not indicative of the results of operations that would have been achieved if the acquisitions had taken place as of the beginning of 2017. Three Months Ended September 30, 2018 Three Months Ended September 30, 2017 Revenues $ 1,839,491 $ 1,965,079 Net income (loss) (267,328 ) 57,472 Net income (loss) per share: Basic (0.04 ) 0.01 Diluted (0.04 ) 0.01 Nine Months Ended September 30, 2018 Nine Months Ended September 30, 2017 Revenues $ 7,499,211 $ 6,809,961 Net income (loss) (352,860 ) 277,215 Net income (loss) per share: Basic (0.05 ) 0.04 Diluted (0.05 ) 0.04 |
Stock Options Awards and Grants
Stock Options Awards and Grants | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Options Awards and Grants | 13. STOCK OPTIONS AWARDS AND GRANTS A summary of the stock option activity and related information for the Company’s 2016 Incentive Stock Option Plan from December 31, 2017 to September 30, 2018 is as follows: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2017 1,050,000 $ 0.27 3.35 $ 514,182 Grants 30,000 1.00 4.89 - Exercised (100,000 ) 0.01 - (38,475 ) Canceled - - - - Outstanding at September 30, 2018 980,000 0.92 3.66 475,707 Exercisable at September 30, 2018 112,500 $ 1.13 3.23 $ 127,125 The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on options with an exercise price less than the Company’s weighted average grant date stock price of $0.3958 per share, which would have been received by the option holders had those option holders exercised their options as of that date. It also includes options granted at exercise prices of $2.00, $1.50, and $1.00, which were equal to the closing sales price of the Company’s common stock on the dates of grant. Option valuation models require the input of highly subjective assumptions. The fair value of stock-based payment awards was estimated using the Black-Scholes option model with a volatility figure derived from an index of historical stock prices of comparable entities until sufficient data exists to estimate the volatility using the Company’s own historical stock prices. Management determined this assumption to be a more accurate indicator of value. The Company accounts for the expected life of options based on the contractual life of options for non-employees. For incentive options granted to employees, the Company accounts for the expected life in accordance with the “simplified” method, which is used for “plain-vanilla” options, as defined in the accounting standards codification. The risk-free interest rate was determined from the implied yields of U.S. Treasury zero-coupon bonds with a remaining life consistent with the expected term of the options. The fair value of stock-based payment awards was estimated using the Black-Scholes pricing model. As of September 30, 2018, there was $73,216 of unrecognized compensation expense. At September 30, 2017, there was $126,991 of unrecognized compensation expense. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | 14. SEGMENT INFORMATION Our business is organized into two reportable segments: renewable systems integration revenue and non-renewable systems integration revenue. The reporting segments follow the same accounting policies used in the preparation of the Company’s unaudited condensed consolidated financial statements. The following represents selected information for the Company’s reportable segments at September 30, 2018 and December 31, 2017, and also for the three and nine months ended September 30, 2018 and 2017. September 30, 2018 December 31, 2017 Assets by Segment Renewable Systems Integration $ 1,612,793 $ 27,589 Non-renewable Systems Integration 1,935,814 1,457,607 $ 3,548,607 $ 1,485,196 For the Three Months Ended For the Nine Months Ended September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Revenue by segment Renewable Systems integration $ 8,499 $ 45,666 $ 40,288 $ 85,919 Non-renewable system Integration 1,830,992 1,292,905 5,535,352 5,050,155 $ 1,839,491 $ 1,338,571 $ 5,575,640 $ 5,136,074 Cost of sales by segment Renewable Systems integration $ 9,019 $ 37,304 $ 40,636 $ 87,649 Non-renewable system Integration 1,438,669 870,369 3,901,125 3,432,098 $ 1,447,688 $ 907,673 $ 3,941,761 $ 3,519,747 Operating expenses Renewable Systems integration $ 123,459 $ 57,447 $ 424,640 $ 206.051 Non-renewable system Integration 503,166 425,897 1,484,000 1.311,364 $ 626,625 $ 483,344 $ 1,908,640 $ 1,517,415 Operating (loss) income by segment Renewable Systems integration $ (126,461 ) $ (49,085 ) $ (424,988 ) $ (207,781 ) Non-renewable system Integration (108,361 ) (3,361 ) 150,227 306,693 $ (234,822 ) $ (52,446 ) $ (274,761 ) $ 98,912 |
401(k) Plans
401(k) Plans | 9 Months Ended |
Sep. 30, 2018 | |
Retirement Benefits [Abstract] | |
401(k) Plans | 15. 401(k) PLANS Substantially all of the Company’s employees may elect to defer a portion of their annual compensation in the Company-sponsored 401(k) tax-deferred savings plans. The Company makes matching contributions in these plans. The amount charged to expense for these plans was $5,753 for the three months ended September 30, 2018 and $16,281 for the nine months ended September 30, 2018. There was no expense for the three or nine months ended September 30, 2017. |
Income Tax
Income Tax | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax | 16. INCOME TAX For the three and nine months ended September 30, 2018 and 2017, the Company did not record any income tax expense or benefit. No tax benefit has been recorded in relation to the pre-tax loss for the three and nine months ended September 30, 2018 and 2017. A partial valuation allowance of $26,197 is listed on the balance sheet at September 30, 2018 to offset any deferred tax asset related to net operating loss carry forwards attributable to the losses. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | 17. RECENT ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued accounting standard update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under previous guidance. This may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In July 2015, the FASB approved the proposal to defer the effective date of ASU 2014-09 standard by one year. Early adoption was permitted after December 15, 2016, and the standard became effective for public entities for annual reporting periods beginning after December 15, 2017 and interim periods therein. In 2016, the FASB issued final amendments to clarify the implementation guidance for principal versus agent considerations (ASU No. 2016-08), accounting for licenses of intellectual property and identifying performance obligations (ASU No. 2016-10), narrow-scope improvements and practical expedients (ASU No. 2016-12) and technical corrections and improvements to ASU 2014-09 (ASU No. 2016-20) in its new revenue standard. The Company has performed a review of the requirements of the new revenue standard and is monitoring the activity of the FASB and the transition resource group as it relates to specific interpretive guidance. The Company reviewed customer contracts, applied the five-step model of the new standard to its contracts, and compared the results to its current accounting practices. The Company has included disclosures required by the new standard and the adoption has not had a material impact on the financial statements. During January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments — Overall: Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”). The standard addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is not permitted with the exception of certain provisions related to the presentation of other comprehensive income. The adoption of ASU 2016-01 did not have a material impact on the Company’s financial position, results of operations or cash flows. During February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”). The standard requires lessees to recognize a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months on its balance sheet. The update also expands the required quantitative and qualitative disclosures surrounding leases. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of ASU 2016-02 is currently being evaluated by the Company, but is not expected to have a material impact on the Company’s financial position, results of operations or cash flows due to an insignificant number of leases that the Company has entered into. In August 2016, FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”). ASU 2016-15 clarifies the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. ASU 2016-15 is effective for fiscal years, and interim periods within those years beginning after December 15, 2017. The Company adopted ASU 2016-15 effective January 1, 2018 and it did not have a material impact on its financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting (“ASU 2017-09”) to clarify when to account for a change to the terms or conditions of a share-based payment award as a modification. Under this new guidance, modification accounting is required if the fair value, vesting conditions, or classification of the award changes as a result of the change in terms or conditions. ASU 2017-09 is effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within each annual reporting period. The Company adopted ASU 2017-09 effective January 1, 2018 and it did not have a material impact on its financial statements. In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (ASC 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). ASU 2018-07 simplifies the accounting for nonemployee share-based payment transactions. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The new standard will become effective for the Company beginning January 1, 2019, with early adoption permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures. In August 2018, the FASB issue ASU 2018-13, Fair Value Measurement (ASC 820ASC 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The new standard will become effective for the Company January 1, 2020, with early adoption permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures. Management does not believe there would have been a material effect on the accompanying financial statements had any other recently issued, but not yet effective, accounting standards been adopted in the current period. |
Net Income Per Share
Net Income Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings (loss) per share | |
Net Income Per Share | 18. NET INCOME PER SHARE The following table sets forth the information needed to compute basic and diluted earnings per share: Nine months ended September 30, 2017 Net income $ 98,912 Weighted average common shares outstanding 6,601,873 Dilutive securities Convertible debt - Options 924,890 Diluted weighted average common shares outstanding 7,526,763 Basic net income per share $ 0.02 Diluted net income per share $ 0.01 For the nine month period ended September 30, 2018 and for the three month periods ended September 30, 2018 and 2017, there are no calculations as there were net losses and certain potential shares of common stock would have been excluded from the calculation of diluted income per share, and therefore, the effect on diluted income per share would have been anti-dilutive. |
Note Payable
Note Payable | 9 Months Ended |
Sep. 30, 2018 | |
Notes to Financial Statements | |
Note Payable | 19. NOTE PAYABLE On August 21, 2018, PVBJ entered into a loan and security agreement (the “Credit Agreement”) with Thermo Communications Funding, LLC (“Thermo”). The Credit Agreement provides for a revolving line of credit in an amount not to exceed $350,000, which is evidenced by a promissory note issued by PVBJ to Thermo (the “Note”). Pursuant to the Credit Agreement, PVBJ granted a security interest to Thermo in all of its assets. In addition, pursuant to a limited recourse guaranty, Andrew Hidalgo, the Company’s Chief Executive Officer personally guaranteed the repayment of the Credit Agreement under certain conditions. Pursuant to the terms of the Credit Agreement, the Company is permitted to borrow up to $350,000 under the revolving credit line, under a borrowing base equal to the lesser of (i) or 85% of Eligible Accounts (as defined in the Credit Agreement). Borrowings under the Credit Agreement may be used for working capital and to refinance certain existing debt of PVBJ. The Credit Agreement contains certain customary representations and warranties, affirmative and negative covenants, and events of default. Principal covenants include a debt service coverage ratio of not less than 1.15 to 1.0, a fixed charge coverage ratio of not less than 1.15 to 1.0, and maintaining a tangible net worth of at least $150,000, excluding intercompany loans to H/Cell. The loan commitment shall expire on August 21, 2020. The interest rate applicable to revolving loans under the Credit Agreement is prime plus 5.0%, subject to a minimum interest rate of 9.5%. The Company paid a loan commitment fee of $7,000, of which $3,500 was paid on closing, and $3,500 will be paid on the first anniversary. The Company will also pay a monthly monitoring fee during the term of the Credit Agreement of 0.33% of the average outstanding balance, payable monthly in arrears. The Company may prepay the Note at any time and terminate the Credit Agreement. In the event that the Company terminates the Credit Agreement, the Company will pay Thermo an early termination fee equal to 4% of the pro rata portion, which pro rata portion is determined by multiplying $350,000 by the number of months prior to the second anniversary of the effective date of the Credit Agreement and then dividing that by 24. The obligations of PVBJ under the Credit Agreement may be accelerated upon the occurrence of an event of default under the Credit Agreement, which includes customary events of default including, without limitation, payment defaults, defaults in the performance of affirmative and negative covenants, the inaccuracy of representations or warranties, cross-defaults, bankruptcy and insolvency related defaults, defaults relating to judgments, an ERISA reportable event occurs, a change of control and a change in the Company’s financial condition that could have a material adverse effect on the Company. As of September 30, 2018, funds totaling $38,296 were available for borrowing under the Thermo Credit Agreement. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 20. SUBSEQUENT EVENTS The Company has evaluated events from September 30, 2018 through the date the financial statements were issued. There were no subsequent events that need disclosure. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and following the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results of be expected for the year ending December 31, 2018 or any other interim period or for any other future year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2017, included in the Company’s 2018 Annual Report on Form 10-K filed with the SEC. The balance sheet as of December 31, 2017 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded when invoices are issued and are presented in the balance sheet net of the allowance for doubtful accounts. The allowance for doubtful accounts is estimated based on the Company’s historical losses, the existing economic conditions in the construction industry, and the financial stability of its customers. Accounts are written off as uncollectible after collection efforts have failed. In addition, the Company does not generally charge interest on past-due accounts or require collateral. At September 30, 2018 and December 31 2017, there was no allowance for doubtful accounts required. |
Property and Equipment, and Depreciation | Property and Equipment, and Depreciation Property and equipment are stated at cost. Depreciation is generally provided using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the remaining term of the lease or the estimated useful life of the improvement. Repairs and maintenance that do not improve or extend the lives of the property and equipment are charged to expense as incurred. |
Goodwill and Identifiable Intangible Assets | Goodwill and Identifiable Intangible Assets Goodwill represents the excess of the aggregate of the following (1) consideration transferred, (2) the fair value of any non-controlling interest in the acquiree, and (3) if the business combination is achieved in stages, the acquisition-date fair value of our previously held equity interest in the acquiree over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. Identifiable intangible assets consist primarily of customer lists and relationships, non-compete agreements and technology based intangibles and other contractual agreements. The Company amortizes finite lived identifiable intangible assets over the shorter of their stated or statutory duration or their estimated useful lives, generally ranging from 3 to 15 years, on a straight-line basis to their estimated residual values and periodically reviews them for impairment. Total identifiable intangible assets comprised 41% of our consolidated total assets at September 30, 2018. There were no intangible assets or goodwill at December 31, 2017. The Company uses the acquisition method of accounting for all business combinations and does not amortize goodwill or intangible assets with indefinite useful lives. Goodwill and intangible assets with indefinite useful lives are tested for possible impairment annually during the fourth quarter of each fiscal year or more frequently if events or changes in circumstances indicate that the asset might be impaired. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss). The Company’s other comprehensive income (loss) is comprised of foreign currency translation adjustments. |
Advertising Costs | Advertising Costs Advertising costs are charged to expense during the period in which they are incurred. Advertising expense for the three months ended September 30, 2018 and 2017 was $1,144 and $336, respectively. For the nine months ended September 30, 2018 and 2017, advertising expense was $3,384 and $2,482, respectively. |
Foreign Currency Translation | Foreign Currency Translation The Company translates its foreign subsidiary’s assets and liabilities denominated in foreign currencies into U.S. dollars at current rates of exchange as of the balance sheet date and income and expense items at the average exchange rate for the reporting period. Translation adjustments resulting from exchange rate fluctuations are recorded in accumulated other comprehensive income. The Company records gains and losses from changes in exchange rates on transactions denominated in currencies other than each reporting location’s functional currency in net income (loss) for each period . |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted ASU 2014-09, “Revenue from Contracts with Customers” (Topic 606) using the modified retrospective method applied to those contracts which were not completed as of December 31, 2017. Results for reporting periods beginning January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period. Under Topic 606 requirements, the Company recognizes revenue from the installation or construction of projects over time using the cost-based input method. The Company accounts for a contract when: (i) it has approval and commitment from both parties, (ii) the rights of the parties are identified, (iii) payment terms are identified, (iv) the contract has commercial substance, and (v) collectability of consideration is probable. The Company considers the start of a project to be when the above criteria have been met and the Company either has written authorization from the customer to proceed or an executed contract. The Company uses the total costs incurred on the project relative to the total expected costs to satisfy the performance obligation. The input method involves measuring the resources consumed, labor hours expended, costs incurred, time lapsed, or machine hours used relative to the total expected inputs to the satisfaction of the performance obligation. Costs incurred prior to actual contract (i.e. design, engineering, procurement of material, etc.) should not be recognized as the client does not have control of the good/service provided. When the estimate on a contract indicates a loss, or claims against costs incurred reduce the likelihood of recoverability of such costs, the Company records the entire estimated loss in the period the loss becomes known. Project contracts typically provide for a schedule of billings or invoices to the customer based on the Company’s job to date percentage of completion of specific tasks inherent in the fulfillment of its performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statement of operations can and usually does differ from amounts that can be billed or invoiced to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceed cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in the Company’s balance sheet under the captions “Costs and estimated earnings in excess of billings” and “Unbilled accounts receivable.” Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized on the contract are reflected as a current liability in the Company’s balance sheet under the caption “Billings in excess of costs and estimated earnings.” Revenue from service or short term contracts is recognized currently as the work is performed. Time and materials are accordingly charged to the customer at completion of the job. The Company recognizes service or short term contract revenues when there is persuasive evidence of an arrangement, delivery has occurred or services are rendered, the sales price is determinable, and collectability is reasonably assured. Revenue is typically recorded once all performance obligations have been satisfied. Sales are recorded net of discounts and returns, which historically have not been material. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents includes cash in bank and money market funds as well as other highly liquid investments with an original maturity of three months or less. The Company had no cash equivalents as of September 30, 2018 or December 31 2017. At times during the three and nine months ended September 30, 2018 and 2017, balances exceeded the FDIC insurance limit of $250,000. |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes expense for its stock-based compensation based on the fair value of the awards at the time they are granted. We estimate the value of stock option awards on the date of grant using the Black-Scholes model. The determination of the fair value of stock-based payment awards on the date of grant is affected by our stock price as well as assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, expected term, risk-free interest rate, expected dividends and expected forfeiture rates. The forfeiture rate is estimated using historical option cancellation information, adjusted for anticipated changes in expected exercise and employment termination behavior. Our outstanding awards do not contain market or performance conditions. |
Sales and Use Tax | Sales and Use Tax The Company collects sales tax in various jurisdictions. Upon collection from customers, it records the amount as a payable to the related jurisdiction. On a periodic basis, it files a sales tax return with the jurisdictions and remits the amount indicated on the return. |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes pursuant to FASB ASC 740, Income Taxes The determination of the Company’s provision for income taxes requires significant judgment, the use of estimates, and the interpretation and application of complex tax laws. Significant judgment is required in assessing the timing and amounts of deductible and taxable items and the probability of sustaining uncertain tax positions. The benefits of uncertain tax positions are recorded in the Company’s financial statements only after determining a more-likely-than-not probability that the uncertain tax positions will withstand challenge, if any, from taxing authorities. When facts and circumstances change, the Company reassesses these probabilities and records any changes in the financial statements as appropriate. Accrued interest and penalties related to income tax matters are classified as a component of income tax expense. The Company recognizes and measures its unrecognized tax benefits in accordance with ASC 740. Under that guidance, management assesses the likelihood that tax positions will be sustained upon examination based on the facts, circumstances and information, including the technical merits of those positions, available at the end of each period. The measurement of unrecognized tax benefits is adjusted when new information is available, or when an event occurs that requires a change. The Company did not identify any material uncertain tax positions. The Company did not recognize any interest or penalties for unrecognized tax benefits. The federal income tax returns of the Company are subject to examination by the IRS, generally for the three years after they are filed. The Company’s 2017, 2016 and 2015 income tax returns are still open for examination by the taxing authorities. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Except for the Company’s earn-out liability, the carrying value of cash and cash equivalents, accounts payable and accrued liabilities, and short-term borrowings, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. All other significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. Where practicable the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed. ● Level 1—quoted prices in active markets for identical assets and liabilities; ● Level 2—observable market based inputs or unobservable inputs that are corroborated by market data; and ● Level 3—significant unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The table below presents a reconciliation of the fair value of the Company’s contingent earn-out obligations that use significant unobservable inputs (Level 3). Balance at December 31, 2017 $ - Earn-out liability from acquisition of PVBJ Inc. 175,318 Payments - Adjustments to fair value 11,028 Balance at September 30, 2018 $ 186,346 The Company values earn-out obligations using a probability weighted discounted cash flow method. This fair value measurement is based on significant unobservable inputs in the market and thus represents a Level 3 measurement within the fair value hierarchy. This analysis reflects the contractual terms of the purchase agreements (e.g., minimum and maximum payments, length of earn-out periods, manner of calculating any amounts due, etc.) and utilizes assumptions with regard to future cash flows, probabilities of achieving such future cash flows and a discount rate. The contingent earn-out obligations are measured at fair value each reporting period and changes in estimates of fair value are recognized in earnings. |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share The Company computes basic net income (loss) per share by dividing net income (loss) per share available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods as applicable. The computation of diluted loss per share excludes dilutive securities for the nine months ended September 30, 2018 because their inclusion would be anti-dilutive. Potentially dilutive securities excluded from the computation of basic and diluted net loss per share for the three months ended September 30, 2018 and 2017 are as follows: September 30, 2018 September 30, 2017 Convertible debt 533,333 - Options to purchase common stock 980,000 1,050,000 Totals 1,513,333 1,050,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Reconciliation the Contingent Earn-out Obligations | The table below presents a reconciliation of the fair value of the Company’s contingent earn-out obligations that use significant unobservable inputs (Level 3). Balance at December 31, 2017 $ - Earn-out liability from acquisition of PVBJ Inc. 175,318 Payments - Adjustments to fair value 11,028 Balance at September 30, 2018 $ 186,346 |
Schedule of Potential Antidilutive Computation of Basic and Diluted Net Loss Per Share | Potentially dilutive securities excluded from the computation of basic and diluted net loss per share for the three months ended September 30, 2018 and 2017 are as follows: September 30, 2018 September 30, 2017 Convertible debt 533,333 - Options to purchase common stock 980,000 1,050,000 Totals 1,513,333 1,050,000 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | At September 30, 2018 and December 31, 2017, property and equipment were comprised of the following: September 30, 2018 December 31, 2017 Furniture and fixtures (5 to 7 years) $ 12,803 $ 6,857 Machinery and equipment (5 to 7 years) 35,565 35,919 Computer and software (3 to 5 years) 120,621 94,761 Auto and truck (5 to 7 years) 783,310 250,044 Leasehold improvements (life of lease) 38,961 40,608 991,260 428,189 Less accumulated depreciation 628,327 325,616 $ 362,933 $ 102,573 |
Uncompleted Contracts (Tables)
Uncompleted Contracts (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Contractors [Abstract] | |
Summary of Cost, Estimated Earnings and Billings on Uncompleted Contracts | Costs, estimated earnings and billings on uncompleted contracts are summarized as follows at September 30, 2018 and December 31, 2017: September 30, 2018 December 31, 2017 Costs incurred on uncompleted contracts $ 1,871,577 $ 2,485,787 Estimated earnings 550,409 779,598 Costs and estimated earnings on uncompleted contracts 2,421,896 3,265,385 Billings to date 2,467,054 3,553,817 Costs and estimated earnings in excess of billings on uncompleted contracts (45,068 ) (288,432 ) Costs and earnings in excess of billings on completed contracts (66,450 ) (252,757 ) $ 21,382 $ (35,675 ) Costs in excess of billings $ 73,180 $ 51,531 Billings in excess of cost (51,798 ) (87,206 ) $ 21,382 $ (35,675 ) |
Commitments (Tables)
Commitments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments on Leases | The future minimum payments on the leases for each of the next three and one-half years and in the aggregate amount to the following: 2018 $ 23,979 2019 54,050 2020 39,639 2021 13,213 $ 130,881 |
Schedule of Payments on Capital Lease Obligation | At September 30, 2018, approximate payments to be made on these capital lease obligations are as follows: 2018 $ 26,569 2019 78,209 2020 75,578 2021 44,718 2022 7,512 Thereafter 4,382 Capital lease obligation 236,968 Less: amounts representing interest 19,138 Current maturities of capital lease obligations 68,240 Capital lease obligations, non-current $ 149,590 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Payable | September 30, 2018 December 31, 2017 Note payable with monthly payments of $716, including interest at 6.50% per annum through November 2020. $ 20,235 $ - Note payable with monthly payments of $1,294.50, including interest at 14.72 per annum through March 2023. $ 56,080 $ - Note payable with monthly payments of $1,063.45, including interest at 5.76% per annum through April 2021 $ 21,120 $ - Note payable with monthly payments of $946.84 including interest at 6.14% per annum through December 2024. $ 53,709 $ - Total non-current portion: $ 151,144 $ - Total current portion: $ (32,538 ) $ - Total: $ 118,606 $ - |
Schedule of Annual Principal Payments | Aggregate annual principal payments in the fiscal years subsequent to December 31 2017, are as follows: Year ending December 31: Amount 2018 (remaining) $ 8,506 2019 40,395 2020 39,679 2021 25,657 2022 22,584 Thereafter 37,377 Notes payable obligation 174,198 Less amounts representing interest (23,055 ) $ 151,144 |
Business Acquisition (Tables)
Business Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of Estimated Consideration Transferred in Acquisition | The preliminary estimated consideration transferred in the acquisition was as follows: Upfront consideration $ 1,177,779 Liabilities assumed 878,565 Total $ 2,056,343 |
Schedule of Fair Value of Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: Cash and cash equivalents $ 30,408 Accounts receivable 277,338 Property and equipment, net 272,554 Customer list 102,422 Goodwill 1,373,621 Total assets acquired 2,056,344 Accounts payable (112,590 ) Debt assumed (590,657 ) Earn-out liability (175,318 ) Total liabilities assumed (878,565 ) Total net assets acquired $ 1,177,779 |
Schedule of Intangible Assets Acquired, Preliminary Estimated Useful Lives and Amortization | A summary of preliminary estimated identifiable intangible assets acquired, preliminary estimated useful lives and amortization method is as follows: Useful Life in Amount Years Amortization Method Customer List $ 102,422 5 Straight Line Total $ 102,422 |
Schedule of Pro Forma Financial Information | Pro forma financial information is presented for informational purposes and is not indicative of the results of operations that would have been achieved if the acquisitions had taken place as of the beginning of 2017. Three Months Ended September 30, 2018 Three Months Ended September 30, 2017 Revenues $ 1,839,491 $ 1,965,079 Net income (loss) (267,328 ) 57,472 Net income (loss) per share: Basic (0.04 ) 0.01 Diluted (0.04 ) 0.01 Nine Months Ended September 30, 2018 Nine Months Ended September 30, 2017 Revenues $ 7,499,211 $ 6,809,961 Net income (loss) (352,860 ) 277,215 Net income (loss) per share: Basic (0.05 ) 0.04 Diluted (0.05 ) 0.04 |
Stock Options Awards and Gran_2
Stock Options Awards and Grants (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Option Activity | A summary of the stock option activity and related information for the Company’s 2016 Incentive Stock Option Plan from December 31, 2017 to September 30, 2018 is as follows: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2017 1,050,000 $ 0.27 3.35 $ 514,182 Grants 30,000 1.00 4.89 - Exercised (100,000 ) 0.01 - (38,475 ) Canceled - - - - Outstanding at September 30, 2018 980,000 0.92 3.66 475,707 Exercisable at September 30, 2018 112,500 $ 1.13 3.23 $ 127,125 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Reportable Segments Information | The following represents selected information for the Company’s reportable segments at September 30, 2018 and December 31, 2017, and also for the three and nine months ended September 30, 2018 and 2017. September 30, 2018 December 31, 2017 Assets by Segment Renewable Systems Integration $ 1,612,793 $ 27,589 Non-renewable Systems Integration 1,935,814 1,457,607 $ 3,548,607 $ 1,485,196 For the Three Months Ended For the Nine Months Ended September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Revenue by segment Renewable Systems integration $ 8,499 $ 45,666 $ 40,288 $ 85,919 Non-renewable system Integration 1,830,992 1,292,905 5,535,352 5,050,155 $ 1,839,491 $ 1,338,571 $ 5,575,640 $ 5,136,074 Cost of sales by segment Renewable Systems integration $ 9,019 $ 37,304 $ 40,636 $ 87,649 Non-renewable system Integration 1,438,669 870,369 3,901,125 3,432,098 $ 1,447,688 $ 907,673 $ 3,941,761 $ 3,519,747 Operating expenses Renewable Systems integration $ 123,459 $ 57,447 $ 424,640 $ 206.051 Non-renewable system Integration 503,166 425,897 1,484,000 1.311,364 $ 626,625 $ 483,344 $ 1,908,640 $ 1,517,415 Operating (loss) income by segment Renewable Systems integration $ (126,461 ) $ (49,085 ) $ (424,988 ) $ (207,781 ) Non-renewable system Integration (108,361 ) (3,361 ) 150,227 306,693 $ (234,822 ) $ (52,446 ) $ (274,761 ) $ 98,912 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings (loss) per share | |
Schedule of Compute Basic and Diluted Earnings Per Share | The following table sets forth the information needed to compute basic and diluted earnings per share: Nine months ended September 30, 2017 Net income $ 98,912 Weighted average common shares outstanding 6,601,873 Dilutive securities Convertible debt - Options 924,890 Diluted weighted average common shares outstanding 7,526,763 Basic net income per share $ 0.02 Diluted net income per share $ 0.01 |
Organization and Line of Busi_2
Organization and Line of Business (Details Narrative) - USD ($) | Feb. 01, 2018 | Sep. 30, 2018 |
Issuance of common stock for acquisition | $ 1,183,581 | |
PVBJ Inc [Member] | Common Stock [Member] | ||
Issuance of common stock for acquisition, shares | 444,445 | |
Issuance of common stock for acquisition | $ 1,177,779 | |
Acquisition earn out liability | $ 221,800 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Allowance for doubtful accounts | |||||
Total identifiable assets percentage | 41.00% | 41.00% | |||
Advertising expense | $ 1,144 | $ 336 | $ 3,384 | $ 2,482 | |
Cash equivalents | |||||
FDIC insured limit amount | $ 250,000 | $ 250,000 | $ 250,000 | $ 250,000 | |
Minimum [Member] | |||||
Amortized finite estimated useful lives | 3 years | ||||
Maximum [Member] | |||||
Amortized finite estimated useful lives | 15 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Reconciliation the Contingent Earn-out Obligations (Details) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Accounting Policies [Abstract] | |
Fair value with unobservable inputs reconciliation, Beginning balance | |
Fair value with unobservable inputs reconciliation, Earn-out liability from acquisition of PVBJ Inc. | 175,318 |
Fair value with unobservable inputs reconciliation, Payments | |
Fair value with unobservable inputs reconciliation, Adjustments to fair value | 11,028 |
Fair value with unobservable inputs reconciliation, Ending balance | $ 186,346 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Potential Antidilutive Computation of Basic and Diluted Net Loss Per Share (Details) - shares | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Totals | 1,513,333 | 1,050,000 |
Convertible Debt [Member] | ||
Totals | 533,333 | |
Options to Purchase Common Stock [Member] | ||
Totals | 980,000 | 1,050,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | Jan. 02, 2018USD ($)$ / shares | Feb. 04, 2016shares | Apr. 30, 2018shares | Apr. 30, 2017shares | Sep. 30, 2018USD ($)ft²$ / shares | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)ft²$ / sharesshares | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) |
Number of options exercised | shares | 100,000 | ||||||||
Revenue from related party | $ 8,499 | $ 45,666 | $ 40,288 | $ 85,919 | |||||
Related party costs | 9,019 | 37,304 | 40,636 | 87,649 | |||||
Due to related party | $ 31,257 | ||||||||
Management expenses | $ 19,500 | $ 47,000 | $ 58,500 | 138,000 | |||||
Convertible debentures interest rate, percentage | 12.00% | 12.00% | 12.00% | ||||||
Convertible debt convertible into common shares conversion price per share | $ / shares | $ 0.75 | $ 0.75 | |||||||
Discount on debt | $ 7,877 | $ 14,268 | |||||||
Convertible Notes Payable [Member] | |||||||||
Convertible debt convertible into common shares conversion price per share | $ / shares | $ 0.75 | ||||||||
Discount on debt | $ 395,000 | 395,000 | |||||||
Renewable Energy Holdings LLC [Member] | |||||||||
Related party costs | 31,617 | 87,649 | |||||||
Rezaul Karim [Member] | |||||||||
Number of options exercised | shares | 100,000 | 100,000 | |||||||
Revenue from related party | $ 31,789 | $ 85,919 | |||||||
Two Directors [Member] | Securities Purchase Agreement [Member] | |||||||||
Convertible debentures, principal amount | $ 400,000 | ||||||||
Convertible debentures interest rate, percentage | 12.00% | ||||||||
Convertible debt convertible into common shares conversion price per share | $ / shares | $ 0.75 | ||||||||
Debt maturity, description | The Debentures, together with any accrued and unpaid interest, become due and payable on January 2, 2020 | ||||||||
Beneficial ownership, percentage | 4.99% | ||||||||
Executive Officers [Member] | |||||||||
Area of office | ft² | 800 | 800 | |||||||
Reza Enterprises, Inc [Member] | |||||||||
Number of common shares sold | shares | 526,316 | ||||||||
Steve Mullane [Member] | October 2018 [Member] | |||||||||
Deducted to cost of installation | $ 686 | $ 686 |
Significant Concentrations of_2
Significant Concentrations of Credit Risk (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | |
FDIC insured limit amount | $ 250,000 | $ 250,000 | |
Accounts Receivable [Member] | Two Unrelated Customers [Member] | |||
Concentrations of credit risk percentage | 20.00% | ||
Accounts Receivable [Member] | Unrelated Customer One [Member] | |||
Concentrations of credit risk percentage | 12.00% | 14.00% | |
Accounts Receivable [Member] | Unrelated Customer Two [Member] | |||
Concentrations of credit risk percentage | 8.00% | 12.00% | |
Accounts Receivable [Member] | Three Unrelated Customers [Member] | |||
Concentrations of credit risk percentage | 36.00% | ||
Accounts Receivable [Member] | Unrelated Customer Three [Member] | |||
Concentrations of credit risk percentage | 10.00% | ||
FDIC, Australian Securities and Investments Commission [Member] | |||
FDIC insured limit amount | $ 186,000 | ||
United States and Australia [Member] | |||
Balance exceeded insured limit amount | 81,236 | $ 145,236 | |
Maximum [Member] | United States and Australia [Member] | |||
FDIC insured limit amount | $ 250,000 |
Major Customers (Details Narrat
Major Customers (Details Narrative) - Sales Revenue [Member] | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
One Customer [Member] | ||||
Concentrations of credit risk percentage | 10.00% | 10.00% | ||
One Customer [Member] | Maximum [Member] | ||||
Concentrations of credit risk percentage | 20.00% | 19.00% | ||
Customer One [Member] | ||||
Concentrations of credit risk percentage | 16.00% | 29.00% | ||
Customer Two [Member] | ||||
Concentrations of credit risk percentage | 14.00% | 14.00% | ||
Customer Three [Member] | ||||
Concentrations of credit risk percentage | 11.00% |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 29,105 | $ 8,454 | $ 104,624 | $ 23,374 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Property and Equipment, Gross | $ 991,260 | $ 428,189 |
Less: accumulated depreciation | 628,327 | 325,616 |
Property and Equipment, Net | 362,933 | 102,573 |
Furniture and Fixtures [Member] | ||
Property and Equipment, Gross | $ 12,803 | 6,857 |
Furniture and Fixtures [Member] | Minimum [Member] | ||
Property and equipment, estimate useful life | 5 years | |
Furniture and Fixtures [Member] | Maximum [Member] | ||
Property and equipment, estimate useful life | 7 years | |
Machinery and Equipment [Member] | ||
Property and Equipment, Gross | $ 35,565 | 35,919 |
Machinery and Equipment [Member] | Minimum [Member] | ||
Property and equipment, estimate useful life | 5 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Property and equipment, estimate useful life | 7 years | |
Computer and Software [Member] | ||
Property and Equipment, Gross | $ 120,621 | 94,761 |
Computer and Software [Member] | Minimum [Member] | ||
Property and equipment, estimate useful life | 3 years | |
Computer and Software [Member] | Maximum [Member] | ||
Property and equipment, estimate useful life | 5 years | |
Auto and Truck [Member] | ||
Property and Equipment, Gross | $ 783,310 | 250,044 |
Auto and Truck [Member] | Minimum [Member] | ||
Property and equipment, estimate useful life | 5 years | |
Auto and Truck [Member] | Maximum [Member] | ||
Property and equipment, estimate useful life | 7 years | |
Leasehold Improvements [Member] | ||
Property and Equipment, Gross | $ 38,961 | $ 40,608 |
Property and equipment estimate useful life, description | life of lease |
Uncompleted Contracts - Summary
Uncompleted Contracts - Summary of Cost, Estimated Earnings and Billings on Uncompleted Contracts (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Contractors [Abstract] | ||
Costs incurred on uncompleted contracts | $ 1,871,577 | $ 2,485,787 |
Estimated earnings | 550,409 | 779,598 |
Costs and estimated earnings on uncompleted contracts | 2,421,896 | 3,265,385 |
Billings to date | 2,467,054 | 3,553,817 |
Costs and estimated earnings in excess of billings on uncompleted contracts | (45,068) | (288,432) |
Costs and earnings in excess of billings on completed contracts | (66,450) | (252,757) |
Costs in excess of billings | 73,180 | 51,531 |
Billings in excess of cost | (51,798) | (87,206) |
Costs, estimated earnings and billings on uncompleted contracts | $ 21,382 | $ (35,675) |
Commitments (Details Narrative)
Commitments (Details Narrative) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
May 31, 2018 | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | |
Lease expiration date | May 31, 2021 | Apr. 30, 2018 | |||
Rent expense | $ 22,582 | $ 23,500 | $ 67,355 | $ 68,500 | |
Interest expense on capital lease | 2,912 | 7,894 | |||
Minimum [Member] | |||||
Operating lease obligation payable | $ 615 | ||||
Operating lease interest rate | 0.0557 | ||||
Maximum [Member] | |||||
Operating lease obligation payable | $ 2,630 | ||||
Operating lease interest rate | 0.0720 | ||||
Four Capital Leases [Member] | |||||
Lease expiration date | Sep. 30, 2023 | ||||
Capital leases of net book value | $ 159,226 | $ 159,226 |
Commitments - Schedule of Futur
Commitments - Schedule of Future Minimum Payments on Leases (Details) | Sep. 30, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 23,979 |
2,019 | 54,050 |
2,020 | 39,639 |
2,021 | 13,213 |
Total | $ 130,881 |
Commitments - Schedule of Payme
Commitments - Schedule of Payments on Capital Lease Obligation (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Commitments and Contingencies Disclosure [Abstract] | ||
2,018 | $ 26,569 | |
2,019 | 78,209 | |
2,020 | 75,578 | |
2,021 | 44,718 | |
2,022 | 7,512 | |
Thereafter | 4,382 | |
Capital lease obligation | 236,968 | |
Less amounts representing interest | 19,138 | |
Current maturities of capital lease obligations | 68,240 | |
Capital lease obligations, non-current | $ 149,590 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) | Jan. 02, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 |
Convertible debt interest percentage | 12.00% | 12.00% | 12.00% | |
Debt maturity date | Jan. 31, 2020 | |||
Stock conversion price | $ 0.75 | $ 0.75 | ||
Discount on debt | $ 7,877 | $ 14,268 | ||
Legal fees | 5,000 | |||
Interest expense | $ 19,877 | 52,768 | ||
Convertible Notes Payable [Member] | ||||
Stock conversion price | $ 0.75 | |||
Discount on debt | $ 395,000 | $ 395,000 | ||
Convertible Notes Payable [Member] | Minimum [Member] | ||||
Ownership percentage | 4.99% | |||
Convertible Notes Payable [Member] | Two Related Parties [Member] | ||||
Convertible debt interest percentage | 12.00% | |||
Convertible debt amount | $ 400,000 | |||
Debt maturity date | Jan. 2, 2020 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt Payable (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Total non-current portion | $ 151,144 | |
Total current portion | (32,538) | |
Total long term debt | 118,606 | |
Notes Payable One [Member] | ||
Total non-current portion | 20,235 | |
Notes Payable Two [Member] | ||
Total non-current portion | 56,080 | |
Notes Payable Three [Member] | ||
Total non-current portion | 21,120 | |
Notes Payable Four [Member] | ||
Total non-current portion | $ 53,709 |
Debt - Schedule of Long-term _2
Debt - Schedule of Long-term Debt Payable (Details) (Parenthetical) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Interest rate | 12.00% | 12.00% |
Maturity date | Jan. 31, 2020 | |
Notes Payable One [Member] | ||
Monthly payment of debt | $ 716 | |
Interest rate | 6.50% | |
Maturity date | Nov. 30, 2020 | |
Notes Payable Two [Member] | ||
Monthly payment of debt | $ 1,295 | |
Interest rate | 14.72% | |
Maturity date | Mar. 31, 2023 | |
Notes Payable Three [Member] | ||
Monthly payment of debt | $ 1,063 | |
Interest rate | 5.76% | |
Maturity date | Apr. 30, 2021 | |
Notes Payable Four [Member] | ||
Monthly payment of debt | $ 947 | |
Interest rate | 6.14% | |
Maturity date | Dec. 31, 2024 |
Debt - Schedule of Annual Princ
Debt - Schedule of Annual Principal Payments (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
2018 (remaining) | $ 8,506 | |
2,019 | 40,395 | |
2,020 | 39,679 | |
2,021 | 25,657 | |
2,022 | 22,584 | |
Thereafter | 37,377 | |
Notes payable obligation | 174,198 | |
Less amounts representing interest | (23,055) | |
Total | $ 151,144 |
Contract Backlog (Details Narra
Contract Backlog (Details Narrative) | Sep. 30, 2018USD ($) |
Contract Backlog | |
Contract backlog | $ 715,595 |
Direct costs | $ 550,409 |
Acquisition Under Common Cont_2
Acquisition Under Common Control (Details Narrative) | Jan. 31, 2017shares |
Exchange Agreement [Member] | |
Issuance of common stock for acquisition, shares | 3,800,000 |
Business Acquisition (Details N
Business Acquisition (Details Narrative) | Feb. 01, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / shares | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)$ / shares | Sep. 30, 2018USD ($)$ / shares | Sep. 30, 2017USD ($) | Dec. 31, 2017$ / shares |
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Issuance of common stock for acquisition | $ 1,183,581 | ||||||
Net loss | $ (267,328) | $ (52,446) | (364,342) | $ 98,912 | |||
Value of intangible asset amortization | 5,121 | $ 13,656 | |||||
Acquisition related cost | 29,500 | $ 44,500 | |||||
Paul V. Benis [Member] | |||||||
Annual earnings before taxes percentage | 0.50 | ||||||
Salary payable | $ 150,000 | ||||||
Net loss | $ 84,343 | $ 61,341 | |||||
PVBJ Inc [Member] | Common Stock [Member] | |||||||
Cash acquired from acquisition | $ 221,800 | ||||||
Issuance of common stock for acquisition, shares | shares | 444,445 | ||||||
Common stock, par value | $ / shares | $ 0.0001 | ||||||
Issuance of common stock for acquisition | $ 1,177,779 |
Business Acquisition - Schedule
Business Acquisition - Schedule of Estimated Consideration Transferred in Acquisition (Details) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Business Combinations [Abstract] | |
Upfront consideration | $ 1,177,779 |
Liabilities assumed | 878,565 |
Total | $ 2,056,343 |
Business Acquisition - Schedu_2
Business Acquisition - Schedule of Fair Value of Assets Acquired and Liabilities Assumed (Details) | Sep. 30, 2018USD ($) |
Business Combinations [Abstract] | |
Cash and cash equivalents | $ 30,408 |
Accounts receivable | 277,338 |
Property and equipment, net | 272,554 |
Customer list | 102,422 |
Goodwill | 1,373,621 |
Total assets acquired | 2,056,344 |
Accounts payable | (112,590) |
Debt assumed | (590,657) |
Earn out liability | (175,318) |
Total liabilities assumed | (878,565) |
Total net assets acquired | $ 1,177,779 |
Business Acquisition - Schedu_3
Business Acquisition - Schedule of Intangible Assets Acquired, Preliminary Estimated Useful Lives and Amortization (Details) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Total | $ 102,422 |
Customer List [Member] | |
Total | $ 102,422 |
Years | 5 years |
Amortization Method | Straight Line |
Business Acquisition - Schedu_4
Business Acquisition - Schedule of Pro Forma Financial Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Business Combinations [Abstract] | ||||
Revenues | $ 1,839,491 | $ 1,965,079 | $ 7,499,211 | $ 6,809,961 |
Net income (loss) | $ (267,328) | $ 57,472 | $ (352,860) | $ 277,215 |
Net income (loss) per share: Basic | $ (0.04) | $ 0.01 | $ (0.04) | $ 0.04 |
Net income (loss) per share: Diluted | $ (0.04) | $ 0.01 | $ (0.04) | $ 0.04 |
Stock Options Awards and Gran_3
Stock Options Awards and Grants (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Market stock price | $ 0.3958 | |
Exercise price | $ 1 | |
Unrecognized compensation expense | $ 73,216 | $ 126,991 |
Common Stock [Member] | ||
Exercise price | $ 2 | |
Common Stock One [Member] | ||
Exercise price | 1.50 | |
Common Stock Two [Member] | ||
Exercise price | $ 1 |
Stock Options Awards and Gran_4
Stock Options Awards and Grants - Schedule of Stock Option Activity (Details) | 9 Months Ended |
Sep. 30, 2018USD ($)$ / sharesshares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Number of Shares, Outstanding at beginning | shares | 1,050,000 |
Number of Shares, Grants | shares | 30,000 |
Number of Shares, Exercised | shares | (100,000) |
Number of Shares, Cancelled | shares | |
Number of Shares, Outstanding at end | shares | 980,000 |
Number of Shares, Exercisable at end | shares | 112,500 |
Weighted-Average Exercise Price, Outstanding at beginning | $ 0.27 |
Weighted-Average Exercise Price, Grants | 1 |
Weighted-Average Exercise Price, Exercised | 0.01 |
Weighted-Average Exercise Price, Cancelled | |
Weighted-Average Exercise Price, Outstanding at end | 0.92 |
Weighted-Average Exercise Price, Exercisable at end | $ 1.13 |
Weighted-Average Remaining Contractual Term, Outstanding at beginning | 3 years 4 months 6 days |
Weighted-Average Remaining Contractual Term, Grants | 4 years 10 months 21 days |
Weighted-Average Remaining Contractual Term, Outstanding at end | 3 years 7 months 28 days |
Weighted-Average Remaining Contractual Term, Exercisable at end | 3 years 2 months 23 days |
Aggregate Intrinsic Value, Outstanding at beginning | $ | $ 514,182 |
Aggregate Intrinsic Value, Grants | |
Aggregate Intrinsic Value, Exercised | $ | $ (38,475) |
Aggregate Intrinsic Value, Canceled | |
Aggregate Intrinsic Value, Outstanding at end | $ | $ 475,707 |
Aggregate Intrinsic Value, Exercisable at end | $ | $ 127,125 |
Segment Information (Details Na
Segment Information (Details Narrative) | 9 Months Ended |
Sep. 30, 2018Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Information - Schedule
Segment Information - Schedule of Reportable Segments Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Assets by Segment | $ 3,548,607 | $ 3,548,607 | $ 1,485,196 | ||
Revenue by segment | 1,839,491 | $ 1,338,571 | 5,575,640 | $ 5,136,074 | |
Cost of sales by segment | 1,447,688 | 907,673 | 3,941,761 | 3,519,747 | |
Operating expenses | 626,625 | 483,344 | 1,908,640 | 1,517,415 | |
Operating (loss) income by segment | (234,822) | (52,446) | (274,761) | 98,912 | |
Renewable Systems Integration [Member] | |||||
Assets by Segment | 1,612,793 | 1,612,793 | 27,589 | ||
Revenue by segment | 8,499 | 45,666 | 40,288 | 85,919 | |
Cost of sales by segment | 9,019 | 37,304 | 40,636 | 87,649 | |
Operating expenses | 123,459 | 57,447 | 424,640 | 206,051 | |
Operating (loss) income by segment | (126,461) | (49,085) | (424,988) | (207,781) | |
Non-renewable Systems Integration [Member] | |||||
Assets by Segment | 1,935,814 | 1,935,814 | $ 1,457,607 | ||
Revenue by segment | 1,830,992 | 1,292,905 | 5,535,352 | 5,050,155 | |
Cost of sales by segment | 1,438,669 | 870,369 | 3,901,125 | 3,432,098 | |
Operating expenses | 503,166 | 425,897 | 1,484,000 | 1,311,364 | |
Operating (loss) income by segment | $ (108,361) | $ (3,361) | $ 150,227 | $ 306,693 |
401(k) Plans (Details Narrative
401(k) Plans (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Retirement Benefits [Abstract] | ||||
Employee compensation plan expense | $ 5,753 | $ 16,281 |
Income Tax (Details Narrative)
Income Tax (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense or benefit | ||||
Valuation allowance | $ 26,197 | $ 26,197 |
Net Income Per Share - Schedule
Net Income Per Share - Schedule of Compute Basic and Diluted Earnings Per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings (loss) per share | ||||
Net income | $ (267,328) | $ (52,446) | $ (364,342) | $ 98,912 |
Weighted average common shares outstanding | 7,586,024 | 7,084,436 | 7,469,307 | 6,601,873 |
Dilutive securities Convertible debt | ||||
Dilutive securities Options | 924,890 | |||
Diluted weighted average common shares outstanding | 7,586,024 | 7,084,436 | 7,469,307 | 7,526,763 |
Basic net income per share | $ (0.04) | $ (0.01) | $ (0.05) | $ 0.02 |
Diluted net income per share | $ (0.04) | $ (0.01) | $ (0.05) | $ 0.01 |
Note Payable (Details Narrative
Note Payable (Details Narrative) - USD ($) | Aug. 21, 2018 | Sep. 30, 2018 |
Credit Agreement [Member] | ||
Revolving line of credit | $ 350,000 | |
Line of credit facility, maximum borrowing capacity | $ 350,000 | |
Line of credit facility, description | 85% of Eligible Accounts (as defined in the Credit Agreement). Borrowings under the Credit Agreement may be used for working capital and to refinance certain existing debt of PVBJ. The Credit Agreement contains certain customary representations and warranties, affirmative and negative covenants, and events of default. Principal covenants include a debt service coverage ratio of not less than 1.15 to 1.0, a fixed charge coverage ratio of not less than 1.15 to 1.0, and maintaining a tangible net worth of at least $150,000, excluding intercompany loans to H/Cell. | |
Tangible capital, net | $ 150,000 | |
Loan commitment, expiration date | Aug. 21, 2020 | |
Loan commitment fee | $ 7,000 | $ 3,500 |
Monthly monitoring fees, percentage | 0.33% | |
Credit Agreement [Member] | Thermo Communications Funding, LLC [Member] | ||
Monthly monitoring fees, percentage | 4.00% | |
Early termination fees | $ 350,000 | |
Credit Agreement [Member] | First Anniversary [Member] | ||
Loan commitment fee | 3,500 | |
Credit Agreement [Member] | Minimum [Member] | ||
Line of credit interest percentage | 9.50% | |
Credit Agreement [Member] | Prime Rate [Member] | ||
Line of credit interest percentage | 5.00% | |
Thermo Credit Agreement [Member] | ||
Amount available for borrowing | $ 38,296 |