Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Jun. 01, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | RELIABILITY INC | |
Entity Central Index Key | 0000034285 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 300,000,000 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 121 | $ 275 |
Trade receivables, net of allowance for doubtful accounts | 5,645 | 7,029 |
Notes receivable from related parties | 3,440 | 3,418 |
Prepaid expenses and other current assets | 258 | 316 |
Total current assets | 9,464 | 11,038 |
Property, plant and equipment, net | 2,476 | 2,483 |
Other intangible assets, net | 229 | 237 |
Goodwill | 518 | 518 |
Total assets | 12,687 | 14,276 |
CURRENT LIABILITIES | ||
Factoring | 4,169 | 5,508 |
Accounts payable | 922 | 1,087 |
Accrued expenses | 412 | 548 |
Accrued payroll | 994 | 907 |
Deferred revenue | 285 | 347 |
Income taxes payable | 803 | 817 |
Notes payable | 1,163 | 890 |
Current portion of mortgage loan payable | 46 | 45 |
Other current liabilities | 103 | 105 |
Total current liabilities | 8,897 | 10,254 |
Mortgage loan payable, net of current portion | 1,733 | 1,745 |
Total liabilities | 10,630 | 11,999 |
Commitment and contingencies (Note 7) | ||
Subsequent events (Note 12) | ||
SHAREHOLDER'S EQUITY | ||
Common stock, without par value, 300,000,000 shares authorized, 300,000,000 issued and outstanding as of March 31, 2020 and as of December 31, 2019 | ||
Additional paid-in capital | 750 | 750 |
Retained earnings | 1,642 | 1,840 |
Total shareholder's equity attributable to Reliability Inc. | 2,392 | 2,590 |
Noncontrolling interest in consolidated affiliates | (335) | (313) |
Total equity | 2,057 | 2,277 |
Total liabilities and shareholder's equity | $ 12,687 | $ 14,276 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 300,000,000 | 300,000,000 |
Common stock, shares, outstanding | 300,000,000 | 300,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue earned | ||
Service revenue | $ 8,801 | $ 8,301 |
Cost of revenue | ||
Cost of revenue | 7,769 | 7,463 |
Gross profit | 1,032 | 838 |
Selling, general and administrative expenses | 1,091 | 654 |
Operating income(loss) | (59) | 184 |
Other income (expense) | ||
Interest income | 21 | 16 |
Interest expense | (138) | (84) |
Other expense | (21) | |
Income (loss) before taxes on income | (197) | 116 |
Income tax benefit/(expense) | (1) | |
Consolidated net income (loss) | (198) | 116 |
Less net income attributable to noncontrolling interest in consolidated affiliates | (39) | (39) |
Net income (loss) attributable to Reliability Inc. | $ (237) | $ 77 |
Net income per share: | ||
Basic | $ 0 | $ 0 |
Diluted | $ 0 | $ 0 |
Share used in per share computation: | ||
Basic | 300,000,000 | 300,000,000 |
Diluted | 300,000,000 | 300,000,000 |
Consolidated Statements of Chan
Consolidated Statements of Change in Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total [Member] | Non - Controlling Interest in Consolidated Affiliates [Member] | Total |
Beginning balance at Dec. 31, 2018 | $ 1,472 | $ 1,472 | $ 1,472 | |||
Beginning balance, shares at Dec. 31, 2018 | 282,000,000 | |||||
Net income (loss) | 116 | 116 | (39) | 77 | ||
Recapitalization | (5) | (5) | (5) | |||
Recapitalization, shares | 18,000,000 | |||||
VIE consolidation | (116) | (116) | ||||
Ending balance at Mar. 31, 2019 | 1,583 | 1,583 | (155) | 1,428 | ||
Ending balance, shares at Mar. 31, 2019 | 300,000,000 | |||||
Beginning balance at Dec. 31, 2019 | 750 | 1,840 | 2,590 | (313) | 2,277 | |
Beginning balance, shares at Dec. 31, 2019 | 300,000,000 | |||||
Net income (loss) | (198) | (198) | (39) | (237) | ||
VIE consolidation | 17 | 17 | ||||
Ending balance at Mar. 31, 2020 | $ 750 | $ 1,642 | $ 2,392 | $ (335) | $ 2,057 | |
Ending balance, shares at Mar. 31, 2020 | 300,000,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income(loss) | $ (237) | $ 77 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 36 | 6 |
Accrued interest | 3 | (16) |
Changes in operating assets and liabilities: | ||
Trade receivables | 1,385 | 968 |
Prepaid expenses and other current assets | 58 | 79 |
Accounts payable | (165) | (124) |
Accrued payroll | 87 | 273 |
Accrued expenses | (136) | (8) |
Deferred revenue | (62) | (38) |
Other liabilities | 17 | |
Income taxes payable | (14) | (18) |
Net cash provided by operating activities | 972 | 1,199 |
Cash flows from investing activities: | ||
Cash from merger | 4 | |
Purchase of fixed assets | (21) | (1) |
Net cash provided by (used in) investing activities | (21) | 3 |
Cash flows from financing activities: | ||
Net (repayment) of line-of-credit | (1,340) | (768) |
Repayment of notes payable | (43) | (222) |
Borrowing of notes payable | 278 | |
Advances to related parties | (18) | |
Net cash used in financing activities | (1,105) | (1,008) |
Net increase (decrease) in cash and cash equivalents | (154) | 194 |
Cash and cash equivalents, beginning of period | 275 | 29 |
Cash and cash equivalents, end of period | 121 | 223 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the period for: Interest | 158 | 104 |
Cash paid during the period for: Income taxes | 20 | 25 |
Non-cash impact of recapitalization from merger | ||
Liabilities assumed in merger | 15 | |
Conversion of shareholder loan to equity in merger | 141 | |
VIE net asset consolidated | 2,459 | |
VIE liabilities consolidated | 1,823 | |
VIE reduction in equity | $ 117 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Nature of Operations and Basis of Presentation | NOTE 1. Nature of Operations and Basis of Presentation Nature of Operations Reliability Incorporated (“Reliability” or the “Company”) is a leading provider of employer of record and temporary media and information technology (“IT”) staffing services that operates, along with its wholly owned subsidiary, The Maslow Media, Inc., (“MMG” or “Maslow”), primarily within the United States of America (the “U.S.”) in three industry segments: Employer of Record (“EOR”), Staffing and Video Production segment provides script to screen media talent. EOR which is a unique workforce management solution, representing 81.3% of the revenue. Our Staffing segment provides skilled field talent on a nationwide basis for IT and finance and accounting client partner projects. Our staffing includes revenue derived from permanent placement. Video Production involves assembling and providing crews for special projects that can last anywhere from a week to six months. Reliability was incorporated under the laws of the State of Texas in 1953, but the then principal business of the Company started in 1971 and was closed down in 2007. The Company completed a reverse merger with MMG (the “Merger”) on October 29, 2019. The Company acquired the customer contracts and trade receivables and assumed certain liabilities of Intelligent Quality Solutions (“IQS”) in exchange for a reduction of notes receivable from Vivos Holdings LLC (“Vivos Holdings”), the previous sole shareholder of MMG, (the “Acquisition”) on December 1, 2019. The owners of Vivos Holdings and their transferees who were issued shares of Reliability Common Stock include Naveen Doki, Silvija Valleru, Shirisha Janumpally (through Judos Trust and Federal Systems), and Kalyan Pathuri (through Igly Trust) together own approximately 84% of the issued and outstanding shares of Reliability Common Stock and are referred to herein as “Vivos” or the “Vivos Shareholders.” Basis of presentation The unaudited condensed consolidated interim financial statements include the accounts of the Company and all wholly owned divisions, including its 100% owned subsidiary, Maslow Media Group, Inc. All significant intercompany accounts and transactions have been eliminated in consolidation. Theses unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S (“U.S. GAAP”) for interim financial information and with instructions to Form 10-Q. Operating results of the interim periods are not necessarily indicative of financial results for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. In preparing these unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the condensed consolidated financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant estimates and assumptions included in the Company’s condensed consolidated financial statements relate revenue recognition, allowances for doubtful accounts, recoverability of notes receivable, useful lives for depreciation and amortization, loss contingencies, allocation of purchase price in connection with business combinations, valuation allowances for deferred income taxes, and the assumptions used for web site development cost classifications. For further information, refer to the financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2019. Concentration of Credit Risk For the quarter ended March 31, 2020, 33.4% of revenue came from AT&T Services, Inc. (inclusive of its DirecTV division) (“AT&T”) and 9.4% from Janssen Pharmaceuticals (which includes workforce partners Johnson & Johnson). AT&T and Janssen accounted for 39% and 8.6% of revenue for year ended March 31, 2019. No other client exceeded 10% of revenues. |
Liquidity and Going Concern
Liquidity and Going Concern | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | NOTE 2. Liquidity and Going Concern Going Concern The accompanying unaudited condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern. On May 5, 2020 (the “Effective Date”), MMG received the proceeds of a loan pursuant to into a promissory note (the “Note”) under the Paycheck Protection Program with TBK Bank, SSB (“Lender”), in the amount of $5,216 (the “PPP Loan”). The Paycheck Protection Program (“PPP”) was established under the recently enacted Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and is administered by the U.S. Small Business Administration (“SBA”). The Lender’s affiliate, Advance Business Capital LLC (d/b/a Triumph Business Capital), is currently the Company’s factor under its existing Factoring and Security Agreement, dated November 4, 2016, as amended and modified. The Company intends to apply for forgiveness of the required repayment of some or all of the PPP Loan in accordance with the PPP. The Company believes that a significant portion of the PPP Loan will be so forgiven, however no assurance can be given that any of such PPP Loan will, in fact, be forgiven. The accompanying unaudited consolidated financial statements do not include any adjustments to reflect the possible future effects on the forgiveness of the PPP Loan. If the PPP Loan is not forgiven in significant part, and the other challenges facing the Company are not resolved favorably, the Company may cease to continue as a going concern. The Company’s ongoing liquidity position is facing pressures due to the loss of business resulting from the COVID-19 Pandemic as well as increased pressure to make cash payments pursuant to the Settlement Agreements (filed as exhibits 10.4, 10.5 and 10.6 the Company’s Current Report on Form 8-K filed on October 30, 2019) prior to the Company’s anticipated liquidation of the shares of Company Common Stock pledged pursuant to the Agreement for the Contingent Liquidation of the Common Stock of Reliability Incorporated (as successor in interest to Maslow Media Group, Inc.), dated October 28, 2019 (the “Liquidation Agreement”) (filed as exhibit 10.30 to the Company’s Current Report on Form 8-K filed on October 30, 2019). The Vivos Shareholders that are the counterparties to the Liquidation Agreement are not cooperating with the Company to liquidate the shares subject thereto as contemplated thereby. No assurance can be given that the Company will return to its pre-Pandemic revenue levels, how long it will take to enforce the requirements of the Liquidation Agreement, and the actual amount of PPP Loan forgiven. As a result, the Company face hurdles to maintaining sufficient liquidity to continue to operate, in which case the Company might be forced to liquidate or seek to reorganize under applicable bankruptcy statutes. The Company is quoted on the OTC Marketplace under the symbol “RLBY”. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Recently Issued Accounting Pronouncements | NOTE 3. Recently Issued Accounting Pronouncements Adopted Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (the “FASB”) issued new guidance on disclosures related to fair value measurements. The guidance is intended to improve the effectiveness of the notes to financial statements by facilitating clearer communication, and it includes multiple new, eliminated and modified disclosure requirements. The guidance was effective for the Company as of January 1, 2020 and did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued new guidance on the accounting for internal-use software. The guidance aligns the accounting for costs incurred to implement a cloud computing arrangement that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. The guidance was effective for the Company as of January 1, 2020 and did not have a material impact on the Company’s consolidated financial statements. Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued new guidance on income taxes. The guidance removes certain exceptions to the general income tax accounting principles and clarifies and amends existing guidance to facilitate consistent application of the accounting principles. The new guidance is effective for us as of January 1, 2021. The Company is assessing the impact of the adoption of this guidance on its consolidated financial statements. |
Acquisition
Acquisition | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisition | NOTE 4. ACQUISITION As a result of the Acquisition on December 1, 2019, our IT staffing division first quarter revenues were $798, which was an 8% improvement over the performance of IQS a year ago. The gross profit in the first quarter of $234 was 14% better than a year ago. Gross margins improved to 29% from 28% a year ago. Results for the three months ended March 31, 2020 and 2019, respectively, are below. For comparability, the three months ended March 31, 2019 presents proforma (unaudited) data to include IQS operations in Company as if it were acquired on January 1, 2019. 2020 2019 Revenues $ 8,801 $ 9,035 Operating income $ 37 $ 221 Net income (loss) $ (238 ) $ 91 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 5. DEBT Convertible Debt The Company has notes payable in the amount of $916 as of March 31, 2020 which was $890 on December 31, 2019, respectively pursuant to a convertible debt offering that commenced June 13, 2019. The offering was conducted pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, and the rules promulgated thereunder. The notes bear interest at 12% per year, with the balance due and payable within 1 year from the issuance date unless earlier converted into shares of Company Common Stock upon the issuance by Reliability of Company Common Stock for gross proceeds of at least $5,000. Warrants can only be redeemable if the proceeds of $5,000 are obtained by the Company from the sale of equity securities. In February 2020, we took out a $250 6-month term loan from Triumph at 10% APR, in order to meet our cash obligations. On April 7, 2020 t Tax Liabilities When the Maslow Media Group was initially acquired by Vivos Holdings, LLC in December 2016, Reliability’s corporate status was changed from an S Corp to a C Corp due to its new ownership structure. This triggered an accelerated tax event, a $215 estimated annual impact per year for four years, that Reliability is working with the IRS to pay off. As of March 31, 2020, the tax liability was $802 compared to $817 as of December 31, 2019. Factoring Facilities Triumph Business Capital On November 4, 2016, the Company entered into a factoring and security agreement with Triumph Business Capital (“Triumph”). Pursuant to the agreement, the Company received advances on its accounts receivable (i.e. invoices) through Triumph to fund growth and operations. The proceeds of this agreement were used to pay operating costs of the business which include employee salaries, vendor payments and overhead expenses. On January 5, 2018, the agreement was amended to lower the factoring fee and interest rate for a term of one year. The agreement was amended again on January 19, 2018, to increase the maximum advance rate to $5,500. In January 2020, a new agreement was negotiated with Triumph lowering advance rate from 18 basis points to 15 and the interest rate from prime plus 2.5% to prime plus 2%. The amount of an invoice eligible for sale to Triumph went from 90% to 93%. The agreement which previously renewed annually, is now month to month. The Company continues to be obligated to meet certain financial covenants in respect to invoicing and reserve account balance. In accordance with the agreement, a reserve amount is required for the total unpaid balance of all purchased accounts multiplied by a percentage equal to the difference between one hundred percent and the advanced rate percentage. As of March 31, 2020, the required amount was 10%. Any excess of the reserve amount is paid to the Company on a weekly basis, as requested. If a reserve shortfall exists for a period of ten-days, the Company is required to make payment to the financial institution for the shortage. Accounts receivable were sold with full recourse. Proceeds from the sale of receivables were $6,857 for the three months ended March 31, 2020. The total outstanding balance under the recourse contract was $4,169 March 31, 2020 and $5,508 as of December 31, 2019. The Factoring Facilities are collateralized by substantially all the assets of the Company. In the event of a default, the Factor may demand that the Company repurchase the receivable or debit the reserve account. Total finance line fees for the three months ended March 31, 2020 and 2019 totaled $14 and $12, respectively. Wilco Capital Management Following the Acquisition, the Company continued factoring IQS Receivables with IQS’s factor, Wilco Capital Management (formerly known as First Avenue Funding, LLC) (“Wilco”). As of March 31, 2020, the outstanding balance was $0 as this relationship ended on March 31, 2020, when Triumph bought out this factoring relationship. |
Variable Interest Entity (VIE)
Variable Interest Entity (VIE) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entity (VIE) | NOTE 6. VARIABLE INTEREST ENTITY (“VIE”) In December 2019, the Company’s executive management learned that prior to the Merger, in December 2017, one of Vivos Shareholders, on behalf of Maslow, executed a guarantee of obligations of Vivos Real Estate Holdings, LLC (“VREH”), under a mortgage loan for the purchase of the property at 22 Baltimore Rd., Rockville, Maryland. Maslow leased this space on market terms. The lease obligation had not been included in Maslow’s financial statements and was not separately disclosed prior to the Merger. The Company terminated the lease of the property at 22 Baltimore Road effective April 30, 2020. U.S. GAAP requires the Company to assess whether VREH is a VIE because Maslow (i) share common shareholders who may or may not have significant influence or control, (ii) is a guarantor of the mortgage loan, (iii) is the sole lessee under a lease where the landlord is an affiliate of the Company, and (iv) has no other business in VREH. A VIE is a legal business structure (such as a corporation, partnership, or trust) that: ● does not provide equity investors with voting rights; or ● the equity investors do not have sufficient financial resources to meet the ongoing operating needs of the business. This is referred to as a thinly capitalized structure. Although the Company has neither any decision-making authority over VREH, nor financial interest in the operations of VREH, the Company is required to consolidate its financial statements with those of VREH for the reasons mentioned above, as it is considered the primary beneficiary of the VIE. As a result of the Company terminating the lease on April 30, 2020, VREH will no longer be considered a VIE after April 30, 2020. The assets and liabilities of the consolidated VIE are comprised of the following as of March 31, 2020 and December 31, 2019: 2020 2019 Building $ 1,856 $ 1,856 Office equipment 185 185 Land 510 510 Accumulated depreciation 167 148 Liabilities assumed 1,779 1,790 Total net assets consolidated $ 605 $ 613 In addition, the related party note receivable with the VIE of $749 and $772 was eliminated for the period ending March 31, 2020 and December 31, 2019, respectively. The potential financial exposure to loss as a guarantor could equal all the book value of the related party mortgage loan payable, a total of approximately $1,779 and $1,790 as of March 31, 2020 and December 31, 2019, respectively with $46 due within the next year. To date, the Company has not been called on for any loan repayment guarantee. As a result of the consolidation, the notes receivable held between Maslow and VREH was eliminated in consolidation. See Note 10 for details on the related party notes receivable. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 7. COMMITMENTS AND CONTINGENCIES The Company is engaged from time to time in legal matters and proceedings arising out of its normal course of business. The Company establishes a liability related to its legal proceedings and claims when it has determined that it is probable that the Company has incurred a liability and the related amount can be reasonably estimated. If the Company determines that an obligation is reasonably possible, the Company will, if material, disclose the nature of the loss contingency and the estimated range of possible loss, or include a statement that no estimate of the loss can be made. On or about February 17, 2020, the Company, as plaintiff, filed a complaint with the Circuit Court of Montgomery County, Maryland against Vivos Holdings, LLC, VREH and Naveen Doki (the “Defendants”), to enforce Maslow’s rights under certain promissory notes and a personal guarantee made by the defendants (the “Debt Collection Suit”). The case is proceeding. The Company believes that it will be granted a judgment in its favor. Maslow intends to continue to vigorously prosecute this litigation. On or about May 6, 2020, the Defendants filed with the Circuit Court of Montgomery County, Maryland a Counterclaim and Third-Party Complaint for Damages, Declaratory and Injunctive Relief and Jury Demand (the “Counterclaim”), The Company believes that the Counterclaim has no merit and is a tactic designed to delay the Defendant’s payment of the debts they owe the Company. The Company will vigorously defend itself and its indemnified officers, directors and other parties as permitted by the Company’s organizational documents. On or about June 5, 2020 the Company submitted a Claimant’s Notice of Intention to Arbitrate and Demand For Arbitration with the American Arbitration Association in New York, and to the Respondents thereto: Naveen Doki; Silvija Valleru; Shirisha Janumpally (individually and in her capacity as trustee of Judos Trust); Kalyan Pathuri (individually in his capacity as trustee of Igly Trust) and Federal Systems (the “Respondents”). The Arbitration alleges that the Respondents breached the Merger Agreement in a number of significant respects and committed fraud in connection with the Merger. The Company is seeking damages which will likely be in whole or in part shares of Company Common Stock received by the Respondents in connection with the Merger. The Company expects to prevail in the Arbitration. On or about February 28, 2020, the Company obtained a temporary restraining order (the “TRO”) regarding any and all actions purportedly taken at an improper meeting of the shareholders of the Company ostensibly called by the Vivos Shareholders. The TRO was granted because the Vivos Shareholders failed to properly call and hold a shareholders meeting in accordance with applicable Texas corporate law and therefore any action purported to be taken there have no meaning or effect. The hearing on motion had been delayed due to the COVID-19 pandemic. On or about May 12, 2020 the Vivos Shareholders filed a motion for contempt alleging that the Company violated the terms of the TRO. At a hearing held on June 5, 2020 the Texas court dismissed the motion for contempt and heard technical arguments regarding jurisdiction. This decision is not expected to have a material impact on the Company regardless of the outcome. On February 28, 2020, Healthcare Resource Network, LLC filed a complaint against Maslow in the Circuit Court of Montgomery County, Maryland. The plaintiff has not specified any alleged damage caused by Maslow and the Company believes any claims are without merit. The Company will defend itself from this case. On September 28, 2018, Credit Cash filed a complaint against Maslow, Vivos, Vivos Acquisitions, LLC, Dr. Doki, Dr. Valleru (the “Parties”) and other defendants in the United States District Court for the District of New Jersey for, among other things, breach of contract of the Maslow and HRCN Credit Facilities and their respective guaranties in relation to the November 15, 2017 agreement (the “DNJ Action”). On October 30, 2018, Credit Cash filed a motion to intervene in an action pending in New York State, Monroe County, filed by HCRN and LE Finance, LLC against the Parties and other defendants (“NY State Action”). On December 10, 2018, the Parties entered into a settlement agreement for the purpose of settling certain claims related to the DNJ Action only. Pursuant to the settlement agreement, certain repayment terms were agreed upon between Credit Cash and the Parties, but Credit Cash did not relinquish the right to pursue any claims related to the NY State Action, nor to pursue any remedies against any of the parties in relation to the November 15, 2017 agreement. Certain of the Vivos Shareholders executed and delivered to Maslow that certain Agreement for the Contingent Liquidation of the Common Stock of Maslow Media Group, Inc., dated as of October 28, 2019 (the “Liquidation Agreement”), pursuant to which such Vivos Shareholders pledged to Maslow the shares of Company Common Stock they received in the Merger to provide the capital required to satisfy the Parties’ obligations under the Settlement Agreements. To date these Vivos Shareholders have not cooperated with the Company to monetize those shares as contemplated by the Liquidation Agreement. The Company will take appropriate action to enforce its rights under the Liquidation Agreement. On or about March 16, 2020, Credit Cash entered its New Jersey confession of judgment with the Circuit Court of Montgomery County, Maryland. The Company may be required to make cash payments pursuant to the Settlement Agreements (filed as exhibits 10.4, 10.5 and 10.6 the Company’s Current Report on Form 8-K filed on October 30, 2019) prior to the Company’s anticipated liquidation of the shares of Company Common Stock pledged pursuant to the Liquidation Agreement. On or about May 5, 2020, Libertas Holdings LLC and Kinetic Direct Funding entered their New York confession of judgment with the Circuit Court of Montgomery County, Maryland. The Vivos Shareholders that are the counterparties to the Liquidation Agreement are not cooperating with the Company to liquidate the shares subject thereto as contemplated thereby. The Company will enforce its rights under the Liquidation Agreement as expeditiously as possible. |
Equity
Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Equity | NOTE 8. EQUITY The Company’s authorized capital stock consists of 300,000,000 shares of common stock, with no par value. All authorized shares of Company Common Stock are issued and outstanding. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 9. RELATED PARTY TRANSACTIONS Stock Purchase Agreement On November 9, 2016, Vivos Holdings LLC ( “ ” Maslow Media Group Notes Receivable The Company has notes receivable from Vivos and VREH, a member of Vivos, both related party affiliates. In connection with the stock purchase agreement noted above, on November 15, 2016, the Company executed a promissory note receivable with Vivos in the amount of $1,400. As defined by the agreement, the loan consists of two periods, whereby the first period from November 15, 2016 until September 30, 2018, no principal or interest payments were required. Interest will accrue monthly and a new loan in the amount of $1,773 will be subject to a second loan period. During the second loan period, interest shall be paid in twenty equal consecutive payments, quarterly. Principal plus any unpaid interest is due September 20, 2023. Interest during both loan periods accrues at a rate of 2.5%. Additionally, monthly payments of $15 are made on behalf of Vivos to the seller by the Company. These payments, plus any other payments made by the Company on behalf of Vivos, are added to the principal balance of the promissory note receivable. In 2018, all quarterly interest payments to be made in phase 2 were offset by the management fees due to Vivos. As of March 31,2020, and December 31, 2019, the total outstanding balance was $2,685 and $2,666, which includes accrued interest receivable of $17 and $162, respectively On November 15, 2017, the Company executed an intercompany promissory note receivable with VREH in the amount of $772. As defined by the agreement, the loan consists of two periods, whereby the first period from November 15, 2017 until March 31, 2018, no principal or interest payments are required. During the first loan period, interest accrued monthly and a new loan amount of $781 will be subject to a second loan period. During the second period, interest is payable in 20 equal consecutive installments and the principal balance plus accrued and unpaid interest is due March 31, 2023. Interest during both periods accrues at a rate of 3.5% annually. In 2018, all quarterly interest payments to be made in Phase 2 were offset by the management fees due to Vivos. In addition, principal payments totaling $30 were made by Vivos. As of March 31, 2020, and December 31, 2019, the total outstanding balance was $749 and $772, respectively. The balances were eliminated during consolidation of the VIE. See Note 7. On June 12, 2019, Maslow entered into a Personal Guaranty agreement with Dr. Doki, pursuant to which Dr. Naveen Doki personally guaranteed to Maslow repayment of $3,000 of the balance of the Promissory Note issued to Vivos on November 15, 2017 within the 2019 calendar year via cash, stock, or other business assets acceptable to the Company. Dr. Doki is a 5% or greater beneficial holder of Company Common Stock, and therefore is a related party. As of February 2020, the Company filed a lawsuit against the majority shareholder, pursuant to the personal guaranty agreement for defaulting on the outstanding notes receivables. On September 5, 2019, Maslow entered into a Secured Promissory Note agreement with Vivos, pursuant to which Maslow issued a secured promissory note to Vivos in the principal amount of $750. The note bears interest at 2.5% per year and requires Vivos to make monthly payments to Maslow of $10 beginning December 1, 2019, with balance due and payable on November 1, 2026. Upon an event of default, which occurs upon failure of Vivos to make any monthly payment due under the terms of the note, Maslow has the right to declare the entire unpaid balance of the note due and payable. The note is secured by 30,000,000 shares of Company Common Stock, which is due and payable upon a default by Vivos, which occurs upon failure of Vivos to make any monthly payment due under the terms of the note. In addition, both Naveen Doki and Silvija Valleru personally guaranty the repayment of the note by Vivos. Naveen Doki and Silvija Valleru are beneficial owners of Vivos and are also 5% or greater beneficial owners of Company Common Stock. As of March 31, 2020, and December 31, 2019, the total outstanding balance was $755 and $752, respectively, which includes interest of $5 and $2, respectively. This note is in default and we are pursuing collection. Debt Settlement Agreements On August 10, 2017, Vivos executed a receivable advance agreement with Argus Capital Funding. The Company received a net advance of $487 in exchange for $705 of the Company’s accounts receivable. Included in this loan is a fee of $218. The agreement was refinanced on November 15, 2017, when Vivos, and Vivos Acquisitions, LLC, via Dr. Naveen Doki and Dr. Silvija Valleru entered into an agreement with CC Business Solutions, a division of Credit Cash NJ, LLC (“Credit Cash”) pursuant to which Credit Cash advanced to the Company $600 in exchange for $780 of the Company’s accounts receivable, to be repaid fully by approximately May 20, 2019 (the “Maslow Credit Facility”). In addition, pursuant to the same agreement, Credit Cash advanced to Healthcare Resource Network, a company owned by Vivos (“HCRN”) a credit facility in the principal amount of $1,005 (“HCRN Credit Facility”). Each of Maslow, Vivos, Vivos Acquisitions, LLC, Dr. Naveen Doki and Dr. Silvija Valleru guaranteed the HCRN Credit Facility. To secure repayment of their guarantee obligations, the Company and Vivos granted to Credit Cash a security interest in all their assets. On September 14, 2018, the Company defaulted on the Maslow Credit Facility. In addition, on same date, the HCRN Credit Facility went into default. As a result, repayment on both facilities was accelerated, with the full balance for each becoming immediately due and payable. On December 10, 2018, the Company, Vivos, Vivos Acquisitions, LLC, Dr. Doki, and Dr. Valleru and Credit Cash entered into a settlement agreement in connection the November 15, 2017 agreement to govern the terms of the repayment of the HCRN Credit Facility and Maslow Credit Facility. Pursuant to the settlement agreement, the Company agreed to pay $10 per week until the entire balance of the Maslow Credit Facility was paid off. Pursuant to a subsequent agreement dated May 17, 2019 not involving the Company, Vivos and Vivos Acquisitions, LLC agreed to fully repay the HCRN Credit Facility via quarterly payments beginning June 30, 2019. The HCRN Credit Facility is still being repaid by Vivos, and as of October 29, 2019, has an outstanding balance of approximately $635. The Company has a binding and enforceable agreement with certain shareholders permitting Maslow to liquidate up to the full amount of Maslow equity held by such shareholders in order to satisfy the shareholders’ obligations under the Settlement Agreements. The total outstanding balance owed by the Company as of December 31, 2018 was $351. As of March 31, 2020, the Company has repaid the outstanding balance due for the Maslow Credit Facility under the settlement agreement in full. The Company is facing pressure to make cash payments pursuant to the Settlement Agreements prior to the Company’s anticipated liquidation of the shares of Company Common Stock pledged pursuant to the Liquidation Agreement. The Vivos Shareholders that are the counterparties to the Liquidation Agreement are not cooperating with the Company to liquidate the shares subject thereto as contemplated thereby. No assurance can be given how long it will take to enforce the requirements of the Liquidation Agreement. The resulting time gap may present a liquidity issue for the Company. Related Party Relationships On October 29, 2019 prior to the Merger, pursuant to the Merger Agreement, Naveen Doki and Silvija Valleru became beneficial owners of 207,384,793 and 51,844,970 shares of RLBY Common Stock, respectively, equal to 69.13% and 17.13% of the total number of shares of RLBY Common Stock outstanding after giving effect to the Merger, respectively. On June 27, 2019 prior to the Merger, Maslow entered into a Securities Purchase Agreement with Hawkeye Enterprises, Inc., a company owned and controlled by Mark Speck, an officer and director of the Company. Pursuant to this agreement, Maslow issued to Hawkeye Enterprises 16,323 (on a post-Merger basis) shares of Company Common Stock , a warrant (as defined below) for 81,616 (on a post-Merger basis) shares of Company Common Stock and a convertible promissory note of same date in the initial principal amount of $50, in exchange for $50. The note bears interest at 12% per year, with balance due and payable on June 27, 2020. As of March 31, 2020, the amount under this agreement totaled to $54. On July 31, 2019 prior to the Merger, the Company entered into a Securities Purchase Agreement with the same officer and director discussed above. Pursuant to this agreement, the Company issued to this individual a Warrant for 81,616 (on a post-Merger basis) shares of Company Common Stock and a convertible promissory note of same date in the initial principal amount of $50, in exchange for $50. The note bears interest at 12% per year, with balance due and payable on July 31, 2020. As of March 31, 2020, the amount under this agreement totaled to $55. On July 31, 2019 prior to the Merger, the Company entered into a Securities Purchase Agreement with Nick Tsahalis, an executive officer and director of the Company. Pursuant to this agreement, the Company issued to this individual 32,646 (on a post-Merger basis) shares of RLBY Common Stock, and a Warrant to purchase 16,323 (on a post-Merger basis) shares of the RLBY Common Stock, and a Convertible Promissory Note of same date in the initial principal amount of $100, in exchange for $100. The note bears interest at 12% per year, with balance due and payable on July 31, 2020. As of March 31, 2020, the amount totaled to $108. On September 18, 2019, in anticipation of the closing of the Merger and intending that it be assumed by Maslow after the closing of the Merger, Hawkeye entered into a letter of intent (the “LOI”) regarding the potential acquisition of a complementary business. Maslow was then prohibited from entering into the LOI directly. In connection with the LOI, Hawkeye paid a non-refundable deposit of $75 with the understanding that after the closing of the Merger, the LOI would be assigned to the Company and the Company would reimburse Hawkeye for the deposit. On October 17, 2019, Hawkeye assigned, and Maslow agreed to assume the LOI and reimbursed Hawkeye for the deposit. On May 8, 2020, Maslow repaid the principal and accrued interest to Hawkeye, totaling $81. The term “warrant” herein refers to warrants issued by Maslow and assumed by RLBY as a result of the Merger. The terms of all Warrants are the same other than as to the number of shares covered thereby. The Warrant may be exercised at any time or from time to time during the period commencing at 10:00 a.m. Eastern time on first business day following the completion of the Qualified Financing (as defined below) and expiring at 5:00 p.m. Eastern time on the fifth annual anniversary thereof (the “Exercise Period”). For purposes herein, a “Qualified Financing” means the issuance by the Company, other than certain excluded issuances of shares of Common Stock, in one transaction or series of related transactions, which transaction(s) result in aggregate gross proceeds actually received by the Company of at least $5,000. The exercise price per full share of RLBY Common Stock shall be 120% of the average sale price of the RLBY Common Stock across all transactions constituting a part of the Qualified Financing, with equitable adjustments being made for any splits, combinations or dividends relating to the RLBY Common Stock, or combinations, recapitalization, reclassifications, extraordinary distributions and similar events, that occur following one transaction constituting a part of the Qualified Financing and prior to one or more other transactions constituting a part of the Qualified Financing (the “Exercise Price”). Convertible note warrants were not valued and included as liability on balance sheet because of uncertainty around their pricing, value and low probability at this juncture in receiving the $5,000 trigger. On December 1, 2019, the Company acquired assets of IQS from Vivos Holdings Inc. as described in Note 4 above. |
Business Segments
Business Segments | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Business Segments | NOTE 10. BUSINESS SEGMENTS The Company operates within three industry segments: EOR, Recruiting and Staffing, and Video and Multimedia Production. The EOR segment provides media field talent to a host of large corporate customers in all 50 states. The Recruiting and Staffing segment provides skilled media and IT field talent on a nationwide basis for customers in a myriad of industries. The Video and Multimedia Production segment provides Script to Screen services for corporate, government and non-profit clients, globally. The following table provides a reconciliation of revenue by reportable segment to consolidated results for the three months ended March 31, 2020 and 2019, respectively: 2020 2019 Revenue: EOR $ 7,149 $ 7,430 Recruiting and Staffing 1,293 454 Video and Multimedia Production 340 387 Other 19 30 Total $ 8,801 $ 8,301 |
Mortgage Loan on Real Estate
Mortgage Loan on Real Estate | 3 Months Ended |
Mar. 31, 2020 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
Mortgage Loan on Real Estate | NOTE 11. MORTGAGE LOAN ON REAL ESTATE As described in Note 6, VREH executed a mortgage loan for the purchase of the property at 22 Baltimore Rd., Rockville, Maryland with the Company as a guarantor of this loan on January 22, 2018. The loan was in the amount of $1,875 with an interest rate of 4.5% annually for the first 60 months of the loan and changes to 5.25% annually on January 28, 2023 for 59 months. The monthly payments during repayment period is $11 with a lump sum payment of $1,393 on December 28 th The mortgage loan as of March 31, 2020 is as follows: 2020 Mortgage Loan $ 1,779 Less current portion of mortgage loan payable 46 Mortgage loan payable, net of current portion $ 1,733 Estimated future maturities of the mortgage loan for the next five years and thereafter is as follows: Years Ending December 31: 2020 $ 36 2021 50 2022 47 2023 41 2024 63 Thereafter 1,542 Total $ 1,779 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 12. SUBSEQUENT EVENTS The Company has evaluated subsequent events through June 11, 2020, the date on which the unaudited condensed consolidated financial statements were available to be issued. Based upon this evaluation, management has determined that no material subsequent events have occurred that would require recognition in or disclosures in the accompanying unaudited condensed consolidated financial statements, except as follows: On April 30, 2020, the Company terminated the lease of the property at 22 Baltimore Road. See Note 6for further details. Employees continue working from their homes, as they have since March 16 due to COVID-19, using the Company’s cloud-based infrastructure to carry out their duties. On May 5, 2020, MMG received the PPP Loan. See Note 2 for further details. COVID-19 In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China. In January 2020, this coronavirus spread to other countries, including the United States, and efforts to contain the spread of this coronavirus intensified. On March 30, Maryland governor Larry Hogan issued a stay at home order which resulted in the Company moving to a work from home model. Whereas we were prepared for this situation and were able to adapt quickly, our business began to suffer from companies and governors in the other 49 states simultaneously or subsequently issuing similar orders. We began to observe the negative impact as our client partners demand began to wane in all segments. We reacted as soon as March 20, 2020 when we instituted furloughs and cut administrative pay by 10% and executive pay by 15%. Other non-essential costs were targeted for reduction or discontinuance. During this uncertain time, our critical priorities are the health and safety of our team members, field talent, candidates and client partners. Much of our billable workforce began working from home dependent on client instructions. Some clients in the healthcare space were still able to have employees and contractors come to their facilities due tom essential service exceptions. Our administrative staff continues to be productive using our web-based applications from their homes. Furthermore, we do not believe these protocols have materially adversely impacted our internal controls, financial reporting systems or our operations. However, the Company expects that the impact of this coronavirus will be materially negative in the short term. The full financial impact cannot be reasonably estimated at this time but is materially affecting our business. Revenues began declining during the last two weeks of March with the pain being the highest on the EOR business with reductions of approximately 35%. The extent to which the coronavirus impacts our results will depend on future developments, which are uncertain and cannot be predicted, including new information which may emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact, circumstances permitting people to return to work, among others. We expect that the social distancing measures, the reduced operational status of our client partners, reductions in production at certain client partners facilities, and general business uncertainty will continue to significantly effect demand in all our segments in the second quarter, and possibly beyond. |
Acquisition (Tables)
Acquisition (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Summary of Unaudited Pro Forma Financial Information | Results for the three months ended March 31, 2020 and 2019, respectively, are below. For comparability, the three months ended March 31, 2019 presents proforma (unaudited) data to include IQS operations in Company as if it were acquired on January 1, 2019. 2020 2019 Revenues $ 8,801 $ 9,035 Operating income $ 37 $ 221 Net income (loss) $ (238 ) $ 91 |
Variable Interest Entity (VIE)
Variable Interest Entity (VIE) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Assets and Liability of Consolidated VIE | The assets and liabilities of the consolidated VIE are comprised of the following as of March 31, 2020 and December 31, 2019: 2020 2019 Building $ 1,856 $ 1,856 Office equipment 185 185 Land 510 510 Accumulated depreciation 167 148 Liabilities assumed 1,779 1,790 Total net assets consolidated $ 605 $ 613 |
Business Segments (Tables)
Business Segments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue and Operating Income by Reportable Segment to Consolidated Results | The following table provides a reconciliation of revenue by reportable segment to consolidated results for the three months ended March 31, 2020 and 2019, respectively: 2020 2019 Revenue: EOR $ 7,149 $ 7,430 Recruiting and Staffing 1,293 454 Video and Multimedia Production 340 387 Other 19 30 Total $ 8,801 $ 8,301 |
Mortgage Loan on Real Estate (T
Mortgage Loan on Real Estate (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
Summary of Mortgage Loan | The mortgage loan as of March 31, 2020 is as follows: 2020 Mortgage Loan $ 1,779 Less current portion of mortgage loan payable 46 Mortgage loan payable, net of current portion $ 1,733 |
Schedule of Estimated Future Maturities of Mortgage Loan | Estimated future maturities of the mortgage loan for the next five years and thereafter is as follows: Years Ending December 31: 2020 $ 36 2021 50 2022 47 2023 41 2024 63 Thereafter 1,542 Total $ 1,779 |
Nature of Operations and Basi_2
Nature of Operations and Basis of Presentation (Details Narrative) | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue [Member] | |||
Concentration risk, benchmark description | No other client exceeded 10% of revenues. | ||
Maslow Media Group, Inc. [Member] | |||
Equity method owned subsidiary | 100.00% | 100.00% | |
AT&T Services, Inc. [Member] | Revenue [Member] | |||
Percentage of revenue | 33.40% | 39.00% | |
Janssen Pharmaceuticals [Member] | Revenue [Member] | |||
Percentage of revenue | 9.40% | 8.60% | |
Naveen Doki, Silvija Valleru, Shirisha Janumpally and Kalyan Pathuri [Member] | |||
Equity method owned subsidiary | 84.00% | 84.00% | |
Employer of Record [Member] | |||
Percentage of revenue | 35.00% | 81.30% |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details Narrative) $ in Thousands | May 05, 2020USD ($) |
Subsequent Event [Member] | PPP Loan [Member] | |
Proceeds of a loan | $ 5,216 |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) $ in Thousands | Dec. 01, 2019 | Mar. 31, 2020 | Mar. 31, 2019 |
Revenue | $ 8,801 | $ 8,301 | |
Gross profit | $ 1,032 | $ 838 | |
Intelligent Quality Solutions, Inc. [Member] | |||
Revenue | $ 798 | ||
Increase in revenue, rate | 8.00% | ||
Gross profit | $ 234 | ||
Increase in gross profit, rate | 29.00% | ||
Decrease in gross profit, rate | 28.00% |
Acquisition - Summary of Unaudi
Acquisition - Summary of Unaudited Pro Forma Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Business Combinations [Abstract] | ||
Revenues | $ 8,801 | $ 9,035 |
Operating income | 37 | 221 |
Net income (loss) | $ (238) | $ 91 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) $ in Thousands | Apr. 07, 2020 | Jan. 05, 2018 | Feb. 29, 2020 | Jan. 31, 2020 | Dec. 31, 2016 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Jan. 19, 2018 |
Tax liability | $ 802 | $ 817 | |||||||
Unpaid balance of purchased accounts percentage | 10.00% | ||||||||
Finance line fees | $ 14 | $ 12 | |||||||
Factoring and Security Agreement [Member] | Prime Rate [Member] | |||||||||
Debt instrument description of variable rate | In January 2020, a new agreement was negotiated with Triumph lowering advance rate from 18 basis points to 15 and the interest rate from prime plus 2.5% to prime plus 2%. | ||||||||
Recourse Contract [Member] | |||||||||
Proceeds from sale of receivables | 6,857 | ||||||||
Outstanding balance of recourse contract | 4,169 | 5,508 | |||||||
Vivos Holdings, LLC [Member] | |||||||||
Accelerated tax event estimated annual impact | $ 215 | ||||||||
Accelerated tax event description | This triggered an accelerated tax event, a $215 estimated annual impact per year for four years, that Reliability is working with the IRS to pay off. | ||||||||
Triumph Business Capital [Member] | Factoring and Security Agreement [Member] | |||||||||
Convertible promissory note term | 1 year | ||||||||
Increase in factoring fee | $ 5,500 | ||||||||
Triumph [Member] | |||||||||
Notes payable | $ 250 | ||||||||
Convertible promissory note interest rate | 10.00% | ||||||||
Convertible promissory note term | 6 months | ||||||||
Triumph [Member] | Subsequent Event [Member] | |||||||||
Convertible promissory note term | 2 months | ||||||||
Debt due date | Feb. 28, 2021 | ||||||||
Wilco Capital Management [Member] | |||||||||
Convertible promissory note initial principal amount | 0 | ||||||||
Minimum [Member] | Factoring and Security Agreement [Member] | |||||||||
Eligible for sale percentage | 90.00% | ||||||||
Minimum [Member] | Factoring and Security Agreement [Member] | Prime Rate [Member] | |||||||||
Convertible promissory note interest rate | 2.00% | ||||||||
Maximum [Member] | Factoring and Security Agreement [Member] | |||||||||
Eligible for sale percentage | 93.00% | ||||||||
Maximum [Member] | Factoring and Security Agreement [Member] | Prime Rate [Member] | |||||||||
Convertible promissory note interest rate | 2.50% | ||||||||
Convertible Debt [Member] | |||||||||
Notes payable | $ 916 | $ 890 | |||||||
Convertible promissory note interest rate | 12.00% | ||||||||
Convertible promissory note term | 1 year | ||||||||
Proceeds from sale of equity securities | $ 5,000 | ||||||||
Convertible Debt [Member] | Minimum [Member] | |||||||||
Proceeds from issuance of common stock | $ 5,000 |
Variable Interest Entity (VIE_2
Variable Interest Entity (VIE) (Details Narrative) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Related party note receivable with VIE | $ 749 | $ 772 |
Related party mortgage loan payable, VIE | 1,779 | $ 1,790 |
Due Within Next Year [Member] | ||
Related party mortgage loan payable, VIE | $ 46 |
Variable Interest Entity (VIE_3
Variable Interest Entity (VIE) - Summary of Assets and Liability of Consolidated VIE (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Total net assets consolidated | $ 2,476 | $ 2,483 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Accumulated depreciation | 167 | 148 |
Liabilities assumed | 1,779 | 1,790 |
Total net assets consolidated | 605 | 613 |
Variable Interest Entity, Primary Beneficiary [Member] | Building [Member] | ||
Assets consolidated gross | 1,856 | 1,856 |
Variable Interest Entity, Primary Beneficiary [Member] | Office Equipment [Member] | ||
Assets consolidated gross | 185 | 185 |
Variable Interest Entity, Primary Beneficiary [Member] | Land [Member] | ||
Assets consolidated gross | $ 510 | $ 510 |
Equity (Details Narrative)
Equity (Details Narrative) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Equity [Abstract] | ||
Capital stock shares authorized | 300,000,000 | 300,000,000 |
Capital stock par value |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | Dec. 02, 2019 | Oct. 29, 2019 | Sep. 05, 2019 | Jul. 31, 2019 | Jun. 27, 2019 | Jun. 12, 2019 | May 20, 2019 | Aug. 10, 2017 | Nov. 15, 2016 | Nov. 09, 2016 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2018 | May 08, 2020 | Dec. 31, 2019 | Sep. 18, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Nov. 15, 2017 |
Repayments of related party | $ 18 | |||||||||||||||||||
Gross proceeds received | $ 5,000 | |||||||||||||||||||
Average sale price percentage | 120.00% | |||||||||||||||||||
Convertible note warrants trigger value | $ 5,000 | |||||||||||||||||||
Secured Promissory Note Agreement [Member] | ||||||||||||||||||||
Related party outstanding balance amount | 755 | $ 752 | ||||||||||||||||||
Accrued interest receivable | 5 | 2 | ||||||||||||||||||
Secured Promissory Note Agreement [Member] | Naveen Doki and Silvija Valleru [Member] | ||||||||||||||||||||
Ownership percentage | 5.00% | |||||||||||||||||||
Receivable Advance Agreement [Member] | HCRN Credit Facility [Member] | ||||||||||||||||||||
Related party outstanding balance amount | $ 635 | |||||||||||||||||||
Debt Settlement Agreement [Member] | HCRN Credit Facility [Member] | ||||||||||||||||||||
Related party outstanding balance amount | $ 351 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Mark Speck [Member] | ||||||||||||||||||||
Promissory note payable | 55 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Mark Speck [Member] | Warrant [Member] | ||||||||||||||||||||
Note interest percentage | 12.00% | |||||||||||||||||||
Debt due date | Jul. 31, 2020 | |||||||||||||||||||
Related party outstanding balance amount | $ 50 | |||||||||||||||||||
Principal amount | $ 50 | |||||||||||||||||||
Conversion of shares | 81,616 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Nick Tsahalis [Member] | ||||||||||||||||||||
Promissory note payable | 108 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Nick Tsahalis [Member] | Common Stock [Member] | ||||||||||||||||||||
Conversion of shares | 32,646 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Nick Tsahalis [Member] | Warrant [Member] | ||||||||||||||||||||
Conversion of shares | 16,323 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | Common Stock [Member] | ||||||||||||||||||||
Promissory note payable | $ 54 | |||||||||||||||||||
Note interest percentage | 12.00% | |||||||||||||||||||
Debt due date | Jun. 27, 2020 | |||||||||||||||||||
Related party outstanding balance amount | $ 50 | |||||||||||||||||||
Principal amount | $ 50 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | Nick Tsahalis [Member] | ||||||||||||||||||||
Note interest percentage | 12.00% | |||||||||||||||||||
Debt due date | Jul. 31, 2020 | |||||||||||||||||||
Related party outstanding balance amount | $ 100 | |||||||||||||||||||
Principal amount | $ 100 | |||||||||||||||||||
Maslow Media Group, Inc. [Member] | ||||||||||||||||||||
Ownership percentage | 100.00% | |||||||||||||||||||
Vivos Holdings, LLC [Member] | ||||||||||||||||||||
Debt instrument periodic payment | $ 30 | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Stock Purchase Agreement [Member] | ||||||||||||||||||||
Promissory note payable | $ 1,773 | |||||||||||||||||||
Note installments term description | During the second loan period, interest shall be paid in twenty equal consecutive payments, quarterly. Principal plus any unpaid interest is due September 20, 2023. | |||||||||||||||||||
Debt instrument periodic payment | $ 15 | |||||||||||||||||||
Related parties, notes receivable | $ 1,400 | |||||||||||||||||||
Debt due date | Sep. 20, 2023 | |||||||||||||||||||
Related party outstanding balance amount | $ 2,685 | 2,666 | ||||||||||||||||||
Accrued interest receivable | 17 | 162 | ||||||||||||||||||
Vivos Holdings, LLC [Member] | Stock Purchase Agreement [Member] | First Loan [Member] | ||||||||||||||||||||
Note interest percentage | 2.50% | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Stock Purchase Agreement [Member] | Second Loan [Member] | ||||||||||||||||||||
Note interest percentage | 2.50% | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Maslow Media Group, Inc. [Member] | ||||||||||||||||||||
Acquisition percentage | 100.00% | |||||||||||||||||||
Purchase price | $ 1,750 | |||||||||||||||||||
Proceeds from settlement of acquisition | 1,400 | |||||||||||||||||||
Promissory note payable | $ 350 | |||||||||||||||||||
Note installments term description | The promissory note was to be paid in twenty-four equal installments, including interest at 4.5%, in the amount of approximately $15, commencing six months after closing with the last payment on March 1, 2019. | |||||||||||||||||||
Note interest percentage | 4.50% | |||||||||||||||||||
Debt instrument periodic payment | $ 15 | |||||||||||||||||||
VREH [Member] | ||||||||||||||||||||
Promissory note payable | $ 772 | |||||||||||||||||||
Note installments term description | During the second period, interest is payable in 20 equal consecutive installments and the principal balance plus accrued and unpaid interest is due March 31, 2023. | |||||||||||||||||||
Debt due date | Mar. 31, 2023 | |||||||||||||||||||
Related party outstanding balance amount | $ 749 | $ 772 | ||||||||||||||||||
Accrued interest receivable | $ 781 | $ 781 | ||||||||||||||||||
VREH [Member] | First Loan [Member] | ||||||||||||||||||||
Note interest percentage | 3.50% | 3.50% | ||||||||||||||||||
VREH [Member] | Second Loan [Member] | ||||||||||||||||||||
Note interest percentage | 3.50% | 3.50% | ||||||||||||||||||
Dr. Naveen Doki [Member] | Personal Guaranty Agreement [Member] | ||||||||||||||||||||
Acquisition percentage | 5.00% | |||||||||||||||||||
Repayments of related party | $ 3,000 | |||||||||||||||||||
Vivos [Member] | Secured Promissory Note Agreement [Member] | ||||||||||||||||||||
Conversion of shares | 30,000,000 | |||||||||||||||||||
Vivos [Member] | Maslow Media Group, Inc. [Member] | Secured Promissory Note Agreement [Member] | ||||||||||||||||||||
Note interest percentage | 2.50% | |||||||||||||||||||
Debt instrument periodic payment | $ 10 | |||||||||||||||||||
Debt due date | Nov. 1, 2026 | |||||||||||||||||||
Principal amount | $ 750 | |||||||||||||||||||
Vivos [Member] | Argus Capital Funding [Member] | Receivable Advance Agreement [Member] | ||||||||||||||||||||
Repayments of related party | $ 705 | |||||||||||||||||||
Related party advance fees | 487 | |||||||||||||||||||
Loan fees | $ 218 | |||||||||||||||||||
Credit Cash NJ, LLC [Member] | Receivable Advance Agreement [Member] | Maslow Credit Facility [Member] | ||||||||||||||||||||
Loan fees | $ 600 | |||||||||||||||||||
Exchange of line of credit facility | $ 780 | |||||||||||||||||||
HCRN [Member] | Receivable Advance Agreement [Member] | HCRN Credit Facility [Member] | ||||||||||||||||||||
Note installments term description | Pursuant to the settlement agreement, the Company agreed to pay $10 per week until the entire balance of the Maslow Credit Facility was paid off. | |||||||||||||||||||
Loan fees | $ 1,005 | |||||||||||||||||||
Naveen Doki [Member] | Merger Agreement [Member] | ||||||||||||||||||||
Conversion of shares | 207,384,793 | |||||||||||||||||||
Conversion of shares, percentage | 69.13% | |||||||||||||||||||
Silvija Valleru [Member] | Merger Agreement [Member] | ||||||||||||||||||||
Conversion of shares | 51,844,970 | |||||||||||||||||||
Conversion of shares, percentage | 17.13% | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Securities Purchase Agreement [Member] | ||||||||||||||||||||
Non refundable deposit | $ 75 | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Securities Purchase Agreement [Member] | Subsequent Event [Member] | ||||||||||||||||||||
Promissory note payable | $ 81 | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Maslow Media Group, Inc. [Member] | Securities Purchase Agreement [Member] | Mark Speck [Member] | Common Stock [Member] | ||||||||||||||||||||
Conversion of shares | 16,323 | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Maslow Media Group, Inc. [Member] | Securities Purchase Agreement [Member] | Mark Speck [Member] | Warrant [Member] | ||||||||||||||||||||
Conversion of shares | 81,616 |
Business Segments - Reconciliat
Business Segments - Reconciliation of Revenue and Operating Income by Reportable Segment to Consolidated Results (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total | $ 8,801 | $ 8,301 |
EOR [Member] | ||
Total | 7,149 | 7,430 |
Recruiting and Staffing [Member] | ||
Total | 1,293 | 454 |
Video and Multimedia Production [Member] | ||
Total | 340 | 387 |
Other [Member] | ||
Total | $ 19 | $ 30 |
Mortgage Loan on Real Estate (D
Mortgage Loan on Real Estate (Details Narrative) - USD ($) $ in Thousands | Jan. 22, 2018 | Mar. 31, 2020 |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | ||
Loan amount | $ 1,875 | |
Interest rate | 4.50% | |
Loan description | The loan was in the amount of $1,875 with an interest rate of 4.5% annually for the first 60 months of the loan and changes to 5.25% annually on January 28, 2023 for 59 months. The monthly payments during repayment period is $11 with a lump sum payment of $1,393 on December 28th, 2027. | |
Loan amount changes to annually percentage | 5.25% | |
Repayments of mortgage loans | $ 11 | |
Lump-some payments | $ 1,393 | |
Outstanding mortgage loan | $ 1,779 |
Mortgage Loan on Real Estate -
Mortgage Loan on Real Estate - Summary of Mortgage Loan (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | ||
Mortgage Loan | $ 1,779 | |
Less current portion of mortgage loan payable | 46 | $ 45 |
Mortgage loan payable, net of current portion | $ 1,733 | $ 1,745 |
Mortgage Loan on Real Estate _2
Mortgage Loan on Real Estate - Schedule of Estimated Future Maturities of Mortgage Loan (Details) $ in Thousands | Mar. 31, 2020USD ($) |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
2020 | $ 36 |
2021 | 50 |
2022 | 47 |
2023 | 41 |
2024 | 63 |
Thereafter | 1,542 |
Total | $ 1,779 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | Mar. 20, 2020 | Mar. 31, 2020 | Mar. 31, 2020 |
Furloughs and Cut Administrative Pay [Member] | |||
Percentage of revenue | 10.00% | ||
Executive Pay [Member] | |||
Percentage of revenue | 15.00% | ||
Employer of Record [Member] | |||
Percentage of revenue | 35.00% | 81.30% |