Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 14, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | MICRONET ENERTEC TECHNOLOGIES, INC. | |
Entity Central Index Key | 854,800 | |
Trading Symbol | MICT | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 9,144,465 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 3,379 | $ 2,114 |
Restricted cash | 237 | 284 |
Trade accounts receivable, net | 4,808 | 5,183 |
Inventories | 5,099 | 4,979 |
Other accounts receivable | 885 | 1,092 |
Held for sale assets | 11,730 | 11,656 |
Total current assets | 26,138 | 25,308 |
Property and equipment, net | 883 | 910 |
Intangible assets and others, net | 1,282 | 1,494 |
Deferred tax assets | 535 | 542 |
Long term deposit | 37 | 12 |
Goodwill | 1,466 | 1,466 |
Total long term assets | 4,203 | 4,424 |
Total assets | 30,341 | 29,732 |
LIABILITIES AND EQUITY | ||
Short term bank credit and current portion of long term bank loans | 2,688 | 1,582 |
Short term credit from others and current portion of long term loans from others | 1,268 | 2,207 |
Trade accounts payable | 3,347 | 3,973 |
Other accounts payable | 2,193 | 3,146 |
Held for sale liabilities | 11,319 | 11,338 |
Total current liabilities | 20,815 | 22,246 |
Long term loans from others | 3,704 | 1,379 |
Accrued severance pay, net | 130 | 133 |
Total long term liabilities | 3,834 | 1,512 |
Stockholders' Equity: | ||
Preferred stock; $.001 par value, 5,000,000 shares authorized, none issued and outstanding | ||
Common stock; $.001 par value, 25,000,000 shares authorized, 9,144,465 and 8,645,650 shares issued and outstanding as of March 31, 2018 and December 31, 2017, respectively. | 9 | 8 |
Additional paid in capital | 11,364 | 10,881 |
Accumulated other comprehensive income (loss) | 154 | (363) |
Accumulated loss | (10,998) | (10,147) |
Micronet Enertec stockholders' equity | 529 | 379 |
Non-controlling interests | 5,163 | 5,595 |
Total equity | 5,692 | 5,974 |
Total liabilities and equity | $ 30,341 | $ 29,732 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 9,144,465 | 8,645,650 |
Common stock, shares outstanding | 9,144,465 | 8,645,650 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Revenues | $ 5,980 | $ 2,701 |
Cost of revenues | 4,258 | 2,327 |
Gross profit | 1,722 | 374 |
Operating expenses: | ||
Research and development | 527 | 397 |
Selling and marketing | 454 | 392 |
General and administrative | 1,212 | 1,119 |
Amortization of intangible assets | 222 | 235 |
Total operating expenses | 2,415 | 2,143 |
Loss from operations | (693) | (1,769) |
Financial (expenses) income, net | (392) | 60 |
Loss before provision for income taxes | (1,085) | (1,709) |
Taxes on income (benefit) | (2) | |
Net loss from continued operation | (1,085) | (1,707) |
Net profit (loss) from discontinued operation | 111 | (595) |
Total Net Loss | (974) | (2,302) |
Net loss attributable to non-controlling interests | (124) | (690) |
Net loss attributable to Micronet Enertec Technologies, Inc. | $ (850) | $ (1,612) |
Basic and diluted earnings (loss) per share from discontinued operation | ||
Basic and diluted loss per share from continued operation | $ (0.11) | $ (0.16) |
Basic and diluted earnings (loss) per share from discontinued operation | $ 0.01 | $ (0.09) |
Weighted average common shares outstanding: | ||
Basic | 8,867,830 | 6,430,762 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (974) | $ (2,302) |
Other comprehensive loss, net of tax: | ||
Currency translation adjustment | 133 | 111 |
Total comprehensive loss | (841) | (2,191) |
Comprehensive loss attributable to non-controlling interests | (432) | (400) |
Comprehensive loss attributable to Micronet Enertec Technologies, Inc. | $ (409) | $ (1,791) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss from continued operations | $ (1,085) | $ (1,707) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 308 | 306 |
Marketable securities | (70) | |
Change in fair value of derivatives, net | (1) | (3) |
Change in deferred taxes, net | (20) | |
Accrued interest and exchange rate differences on bank loans | (51) | 195 |
Extinguishment of loan costs and commissions | 360 | |
Accrued interest and exchange rate differences on loans from others | 112 | 109 |
Stock-based compensation | 125 | 33 |
Decrease (increase) in trade accounts receivable, net | 310 | (100) |
Decrease (increase) in inventories | (190) | 461 |
Increase (decrease) in accrued severance pay, net | (3) | 7 |
Decrease (increase) in other accounts receivable | 199 | (390) |
Decrease in trade accounts payable | (580) | (407) |
Decrease in other accounts payable | (910) | |
Net cash used in operating activities | (1,406) | (1,587) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (72) | (55) |
Marketable securities | 3,049 | |
Net cash provided by (used in) investing activities | (72) | 2,994 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Short term bank credit | 1,139 | (2,469) |
Receipt of loans from others, net | 4,971 | |
Extinguishment of loan costs | (360) | |
Repayment of short term loans | (3,538) | |
Issuance of shares, net | 479 | 130 |
Issuance of warrants net | 29 | |
Issuance of shares by subsidiary, net | 2,474 | |
Net cash provided by financing activities | 2,720 | 135 |
NET CASH INCREASE IN CASH AND CASH EQUIVALENTS | 1,242 | 1,542 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF THE PERIOD | 2,398 | 1,133 |
TRANSLATION ADJUSTMENT ON CASH AND CASH EQUIVALENTS | (24) | 118 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF THE PERIOD | 3,616 | 2,793 |
Amount paid during the period for: | ||
Interest | 294 | 132 |
Taxes | $ 4 | $ 2 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2018 | |
Description of Business [Abstract] | |
DESCRIPTION OF BUSINESS | NOTE 1 — DESCRIPTION OF BUSINESS Overview Micronet Enertec Technologies, Inc., a U.S.-based Delaware corporation, was formed on January 31, 2002. On March 14, 2013, we changed our corporate name from Lapis Technologies, Inc. to Micronet Enertec Technologies, Inc., or we, Micronet Enertec or the Company. We operate primarily through two Israel-based companies, Enertec Systems 2001 Ltd., or Enertec, our wholly-owned subsidiary, and Micronet Ltd., or Micronet, in which we held 50.07% as of March 31, 2018, and is controlled by us. On February 23, 2017, Micronet filed an immediate report with the Tel Aviv Stock Exchange, or the TASE, announcing that it had closed on a public offering of its ordinary shares and sold an aggregate of 6,100,000 shares of its ordinary shares for aggregate gross proceeds of NIS 9,844,020. As a result of the public offering, the Company’s ownership interest in Micronet was diluted from 62.9% to 49.31%. In order to maintain a controlling interest of Micronet, on February 27, 2017, the Company purchased an additional 140,000 shares of Micronet in a separate transaction with a shareholder of Micronet. In addition, on February 28, 2017, Mr. David Lucatz, our President and Chief Executive Officer, executed an irrevocable proxy assigning his voting power over 45,000 shares of Micronet for our benefit. As a result, our voting interest of Micronet was increased to 50.07% of the issued and outstanding shares of Micronet. Micronet is a publicly traded company on the TASE and operates in the growing commercial Mobile Resource Management, or MRM, market. Micronet through both its Israeli and U.S. operational offices designs, develops, manufactures and sells rugged mobile computing devices that provide fleet operators and field workforces with computing solutions in challenging work environments. Micronet’s vehicle cabin installed and portable tablets increase workforce productivity and enhance corporate efficiency by offering computing power and communication capabilities that provide fleet operators with visibility into vehicle location, fuel usage, speed and mileage. Micronet’s customers consist primarily of application service providers and solution providers specializing in the MRM market. Enertec operates in the Aerospace and Defense markets and designs, develops, manufactures and supplies various customized military computer-based systems, simulators, automatic test equipment and electronic instruments. Enertec’s solutions and systems are designed according to major aerospace integrators’ requirements and are integrated by them into critical systems such as command and control, missile fire control, maintenance of military aircraft and missiles for use by the Israeli Air Force and Navy and by foreign defense entities. On December 31, 2017, the Company, Enertec and our wholly owned subsidiary, Enertec Management Ltd., entered into a Share Purchase Agreement, or the Share Purchase Agreement, with Coolisys Technologies Inc., or Coolisys, a subsidiary of DPW Holdings, Inc., or DPW, pursuant to which we agreed to sell the entire share capital of Enertec to Coolisys. As consideration for the sale of Enertec’s entire share capital, Coolisys has agreed to pay, at the closing of the transaction, a purchase price of $5,250 as well as assume up to $4,000 of Enertec debt which consideration may be subject to certain adjustments set forth in the Share Purchase Agreement. Enertec met the definition of a component as defined by Accounting Standards Codification, or ASC, Topic 205, since Enertec has been classified as held for sale and the Company believes the sale represents a strategic shift in its business. Accordingly, its assets and liabilities were classified as held for sale and the results of operations in the statement of operations and prior periods’ results have been reclassified as a discontinued operation. Enertec met the definition of a component. No closing for the sale of Enertec has taken place and we continue to operate Enertec in the normal course pending the closing of the Share Purchase Agreement. The parties are working towards completing the closing conditions related to the bank's approval for the change of control. The accompanying unaudited consolidated financial statements of the Company and its subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2018, are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The balance sheet at December 31, 2017, has been derived from the Company’s audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, as filed with the U.S. Securities and Exchange Commission, or the SEC. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements are prepared in accordance with the U.S. GAAP. The consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company transactions and balances among the Company and its subsidiaries are eliminated upon consolidation. Functional Currency The functional currency of Micronet Enertec is the U.S. dollar. The functional currency of certain subsidiaries is their local currency. The financial statements of those companies are included in consolidation, based on translation into U.S. dollars. Assets and liabilities are translated at year-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the year. Differences resulting from translation are presented in the consolidated statements of comprehensive income. Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Principles of Consolidation The consolidated financial statements comprise the results and position of the Company and its subsidiaries. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its operating activities. In assessing control, legal and contractual rights, are taken into account. The consolidated financial statements of subsidiaries are included in the consolidated financial statements from the date that control is achieved until the date that control is lost. Intercompany transactions and balances are eliminated upon consolidation. Cash and Cash Equivalents Cash equivalents are considered by the Company to be highly-liquid investments, including inter-alia, short-term deposits with banks, which do not exceed maturities of three months at the time of deposit and which are not restricted. Revenue Recognition On January 1, 2018, the Company adopted ASC 606, “Revenue from Contracts with Customers,” or ASC 606, and all the related amendments (“new revenue standard”) with respect to all contracts using the modified retrospective method. A contract with a customer exists only when: the parties to the contract have approved it and are committed to perform their respective obligations, the Company can identify each party’s rights regarding the distinct goods or services to be transferred (“performance obligations”), the Company can determine the transaction price for the goods or services to be transferred, the contract has commercial substance and it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer. Revenues are recorded in the amount of consideration to which the Company expects to be entitled in exchange for performance obligations upon transfer of control to the customer, excluding amounts collected on behalf of other third parties and sales taxes. The amount of consideration to which the Company expects to be entitled varies as a result of rebates, chargebacks, returns and other allowances. The cumulative effect of initially applying the new revenue standard was immaterial for the quarter ended March 31, 2018, based on the adoption of ASC 606. Allowance for Doubtful Accounts The Company establishes an allowance for doubtful accounts to ensure trade and financing receivables are not overstated due to uncollectability. The allowance for doubtful accounts was based on specific receivables, which their collection, in the opinion of Company’s management, is in doubt. Trade receivables are charged off in the period in which they are deemed to be uncollectible. As of March 31, 2018, and December 31, 2017, the allowance for doubtful accounts amounted to $314 and $0, respectively. Reclassifications Certain balance sheet amounts and cash flow amounts have been reclassified to conform with the current year presentation. Inventories Inventories of raw materials are stated at the lower of cost (first-in, first-out basis) or realizable value. Cost of work in process is comprised of direct materials, direct production costs and an allocation of production overhead based on normal operating capacity. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over their estimated useful lives. Annual rates of depreciation are as follows: Leasehold improvements Over the shorter of the lease term or Machinery and equipment 7-14 years Furniture and fixtures 10-14 years Transportation equipment 7 years Computer equipment 3 years Stock-Based Compensation The Company accounts for stock-based compensation under the fair market value method under which compensation cost is measured at the grant date based on the value of the award and is recognized over the vesting period, which is usually the service period. For stock options, fair value is determined using an option-pricing model that takes into account the stock price at the grant date, the exercise price, the expected life of the option, the volatility of the underlying stock, the expected dividends on it, and the risk-free interest rate over the expected life of the option. Research and Development Costs Research and development costs are charged to statements of income as incurred net of grants from the Israel Innovation Authority (formerly known as the Israel Office of the Chief Scientist of the Ministry of Economy). Loss per Share Basic net earnings per share are computed based on the weighted average number of shares of common stock outstanding during each year. Long-Lived Assets and Intangible assets Intangible assets that are not considered to have an indefinite useful life are amortized using the straight-line basis over their estimated useful lives. The Company evaluates property and equipment and purchased intangible assets with finite lives for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flow and recognizes an impairment loss when the estimated undiscounted future cash flow expected to result from the use of the asset plus the net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When the Company identifies an impairment, it reduces the carrying amount of the asset to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. During the three months ended March 31, 2018, and the year ended December 31, 2017, no indicators of impairment have been identified. Goodwill Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill is not amortized, but rather is subject to an annual impairment test. The Company has one continued operation, consisting of the MRM segment, and the entire goodwill was allocated to this MRM segment. The goodwill impairment tests are conducted in two steps. In the first step, the Company determines the fair value of the reporting unit. If the net book value of the reporting unit exceeds its fair value, the Company would then perform the second step of the impairment test which requires allocation of the reporting unit’s fair value of all of its assets and liabilities in a manner similar to an acquisition cost allocation, with any residual fair value being allocated to goodwill. The implied fair value of the goodwill is then compared to the carrying value to determine impairment, if any. Comprehensive Income (Loss) Financial Accounting Standards Board, or FASB, ASC 220-10, “Reporting Comprehensive Income,” requires the Company to report in its consolidated financial statements, in addition to its net income, comprehensive income (loss), which includes all changes in equity during a period from non-owner sources including, as applicable, foreign currency items and other items. The Company’s other comprehensive income for all periods presented is related to the translation from functional currency to the presentation currency. Income Taxes Deferred taxes are determined utilizing the “asset and liability” method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance when it is more likely than not that deferred tax assets will not be realized in the foreseeable future. The Company applied FASB ASC Topic 740-10-25, “Income Taxes,” which provides guidance for recognizing and measuring uncertain tax positions and prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognizing, classification and disclosure of these uncertain tax positions. The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense. Financial Instruments 1. Concentration of credit risks: Financial instruments that have the potential to expose the Company to credit risks are mainly cash and cash equivalents, bank deposit accounts, marketable securities and trade receivables. The Company holds cash and cash equivalents, securities and deposit accounts at large banks in Israel, thereby substantially reducing the risk of loss. With respect to trade receivables, the risk is limited due to the geographical spreading, nature and size of the entities that constitute the Company’s customer base. The Company assesses the financial position of its customers prior to the engagement with them. The Company performs ongoing credit evaluations of its customers for the purpose of determining the appropriate allowance for doubtful accounts and generally does not require collateral. An appropriate allowance for doubtful accounts is included in the accounts. 2. Fair value measurement: The Company measures fair value and discloses fair value measurements for financial and non-financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value. Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update, or ASU, No. 2016-02, which supersedes the lease accounting guidance in ASC 840, “Leases.” The new guidance requires lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. The guidance is effective for reporting periods (interim and annual) beginning after December 15, 2018, for public companies, with early adoption permitted. The new guidance must be adopted using a modified retrospective approach. We are currently assessing the potential impact of this ASU on our consolidated financial position and results of operations. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Measurements [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 3 – FAIR VALUE MEASUREMENTS Items carried at fair value as of March 31, 2018, and December 31, 2017, are summarized below: Fair value measurements using input type March 31, 2018 Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 3,379 - - 3,379 Restricted cash 237 - - 237 Derivative assets - 57 - 57 Derivative liabilities - phantom option - (10 ) - (10 ) Total $ 3,616 47 - 3,663 Fair value measurements using input type December 31, 2017 Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 2,114 $ - $ - $ 2,114 Restricted cash 284 - - 284 Derivative liability - 3 - 3 Derivative liability- phantom option - (11 ) - (11 ) Total 2,398 $ (8 ) $ - $ 2,390 |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2018 | |
Inventories [Abstract] | |
INVENTORIES | NOTE 4 – INVENTORIES Inventories are stated at the lower of cost or market, computed using the first-in, first-out method. Inventories consist of the following: March 31, 2018 December 31, 2017 Raw materials $ 3,177 $ 3,189 Work in process 1,922 1,790 $ 5,099 $ 4,979 |
Segments
Segments | 3 Months Ended |
Mar. 31, 2018 | |
Segments [Abstract] | |
SEGMENTS | NOTE 5 – SEGMENTS The Company accounts for its segment information in accordance with the provisions of ASC Topic 280-10, “Segment Reporting,” or ASC 280-10. ASC 280-10 establishes annual and interim reporting standards for operating segments of a company. ASC 280-10 requires disclosures of selected segment-related financial information about products, major customers and geographic areas based on the Company’s internal accounting methods. 1. Geographic Areas Information: Sales: Classified by Geographic Areas: The following presents total revenue for the three months ended March 31, 2018, and 2017 by geographic area: Three months ended 2018 2017 United States $ 5,120 $ 2,287 Israel 1 20 Other 859 394 Total $ 5,980 $ 2,701 |
Loans from Others
Loans from Others | 3 Months Ended |
Mar. 31, 2018 | |
Loan from Others [Abstract] | |
LOAN FROM OTHERS | NOTE 6 – LOANS FROM OTHERS On March 29, 2018, the Company and its subsidiary, Enertec Electronics Ltd., or Enertec Electronics, executed and closed on a securities purchase agreement with YA II PN Ltd, or YA II, whereby the Company issued and sold to YA II (1) certain Series A Convertible Debentures in the aggregate principal aggregate amount of $3,200, or the Series A Debentures, and (2) a Series B Convertible Debenture in the principal aggregate amount of $1,800, or the Series B Debenture. The Series A Debentures were issued in exchange for the cancellation and retirement of certain promissory notes issued by the Company to YA II on October 28, 2016, December 22, 2016, June 8, 2017 and August 22, 2017, or collectively, the Prior Notes, with a total outstanding aggregate principal amount of $3,200. The Series B Debenture was issued and sold for aggregate gross cash proceeds of $1,800. In addition, pursuant to the terms of the securities purchase agreement, the Company agreed to issue to YA II a warrant to purchase 375,000 shares of the Company’s common stock at a purchase price of $2.00 per share, a warrant to purchase 200,000 shares of the Company’s common stock at a purchase price of $3.00 per share and a warrant to purchase 112,500 shares of the Company’s common stock at a purchase price of $4.00 per share, or collectively, the Warrants. In conjunction with the issuance of the Series A Debentures and the Series B Debentures, a total of $273,787 in fees and expenses were deducted from the aggregate gross proceeds. The Company evaluated the modifications to the terms of the loans in accordance with the guidance in ASC Topic 470-50-40 “Derecognition,” and concluded that the new debentures are substantially different from the original loans. Therefore, these modifications were accounted for as an extinguishment of the existing debt. As a result, the Company recorded an expense of $360. |
Discontinued Operation
Discontinued Operation | 3 Months Ended |
Mar. 31, 2018 | |
Discontinued Operation [Abstract] | |
DISCONTINUED OPERATION | NOTE 7 — DISCONTINUED OPERATION On December 31, 2017, we, Enertec and our wholly owned subsidiary, Enertec Management Ltd., entered into a Share Purchase Agreement with Coolisys, a subsidiary of DPW, pursuant to which we agreed to sell the entire share capital of Enertec to Coolisys. As consideration for the sale of Enertec’s entire share capital, Coolisys has agreed to pay at the closing of the transaction a purchase price of $5,250, as well as assume up to $4,000 of Enertec debt which consideration may be subject to certain adjustments set forth in the Share Purchase Agreement. Enertec met the definition of a component. Accordingly, its assets and liabilities were classified as held for sale and the results of operations in the statement of operations and prior periods results have been reclassified as discontinued operation accordingly. The parties are working towards completing the closing conditions related to the bank's approval for the change of control. In conjunction with, and as a condition to, the closing of the Share Purchase Agreement, the Company, Enertec, Coolisys, DPW and Mr. David Lucatz, the Company’s Chief Executive Officer, agreed to execute a consulting agreement, or the Consulting Agreement, whereby the Company, via Mr. Lucatz, will provide Enertec with certain consulting and transitional services over a 3 year period as necessary and requested by Coolisys (but in no event to exceed 20% of Mr. Lucatz’s time). Coolisys (via Enertec) will pay the Company an annual consulting fee of $150 as well as issue the Company 150,000 restricted shares of DPW Class A common stock, or the DPW Equity, for such services, to be vested and released from restriction in three equal installments, with the initial installment vesting the day after the closing and the remaining installments vesting on each of the first 2 anniversaries of the closing. In the event of a change of control in the Company, or if Mr. Lucatz shall no longer be employed by the Company, the rights and obligations under the Consulting Agreement shall be assigned to Mr. Lucatz along with the DPW Equity. The following is the composition from discontinued operation: March 31, 2018 December 31, 2017 ASSETS Current assets: Cash and cash equivalents $ 139 $ 279 Restricted cash 4,343 4,224 Trade accounts receivable, net 4,844 4,807 Inventories 1,646 1,506 Other accounts receivable 13 66 Total current assets 10,985 10,882 Property and equipment, net 650 676 Long-term Assets 95 98 Total long-term assets 745 774 Total assets $ 11,730 $ 11,656 March 31, 2018 December 31, 2017 LIABILITIES Short-term bank credit $ 8,596 8,863 Trade accounts payable 1,491 1,380 Other accounts payable 1,098 957 Total current liabilities 11,185 11,200 Accrued severance pay, net 134 138 Total Liabilities $ 11,319 11,338 Three months ended 2018 2017 Revenues $ 2,578 2,558 Cost of revenues 1,931 2,245 Gross profit 647 313 Operating expenses: Research and development 58 136 Selling and marketing 119 153 General and administrative 260 344 Total operating expenses 437 633 Profit (loss) from operations 210 (320 ) Finance income (expense), net 99 (200 ) Profit (loss) before provision for income taxes 111 (520 ) Taxes on income - 75 Net profit (loss) 111 (595 ) Three months ended 2018 2017 Net cash provided by (used in) operating activities $ 255 (2,006 ) Net cash provided by (used in) investing activities (10 ) (15 ) Net cash provided by (used in) financing activities (266 ) 2,295 NET CASH INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH (21 ) 274 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF THE PERIOD 4,503 4,023 TRANSLATION ADJUSTMENT OF CASH AND CASH EQUIVALENTS CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF THE PERIOD $ 4,482 4,297 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 8 - SUBSEQUENT EVENTS On May 8, 2018, the Company and YA II mutually agreed to terminate the Company’s Standby Equity Distribution Agreement with YA II, or the 2017 SEDA. As a result of the termination of the 2017 SEDA, the Company’s obligation to pay any and all of the remaining commitment fee owed under the 2017 SEDA was terminated as well. On May 8, 2018, the Company and YA II amended the terms of the Series A Debentures and Series B Debenture to clarify that YA II shall not have the right to convert the Series A Debentures and Series B Debenture into shares of the Company’s common stock in an amount to exceed 19.99% of the Company’s issued and outstanding shares of common stock as of February 22, 2018, inclusive of certain shares of common stock sold by the Company to D-Beta One EQ, Ltd. on February 22, 2018. In addition, the Company and YA II agreed to amend the terms of the Warrants to remove the Company’s right to voluntarily adjust the Warrant’s exercise prices. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements are prepared in accordance with the U.S. GAAP. The consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company transactions and balances among the Company and its subsidiaries are eliminated upon consolidation. |
Functional Currency | Functional Currency The functional currency of Micronet Enertec is the U.S. dollar. The functional currency of certain subsidiaries is their local currency. The financial statements of those companies are included in consolidation, based on translation into U.S. dollars. Assets and liabilities are translated at year-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the year. Differences resulting from translation are presented in the consolidated statements of comprehensive income. |
Use of Estimates | Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements comprise the results and position of the Company and its subsidiaries. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its operating activities. In assessing control, legal and contractual rights, are taken into account. The consolidated financial statements of subsidiaries are included in the consolidated financial statements from the date that control is achieved until the date that control is lost. Intercompany transactions and balances are eliminated upon consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents are considered by the Company to be highly-liquid investments, including inter-alia, short-term deposits with banks, which do not exceed maturities of three months at the time of deposit and which are not restricted. |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted ASC 606, “Revenue from Contracts with Customers,” or ASC 606, and all the related amendments (“new revenue standard”) with respect to all contracts using the modified retrospective method. A contract with a customer exists only when: the parties to the contract have approved it and are committed to perform their respective obligations, the Company can identify each party’s rights regarding the distinct goods or services to be transferred (“performance obligations”), the Company can determine the transaction price for the goods or services to be transferred, the contract has commercial substance and it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer. Revenues are recorded in the amount of consideration to which the Company expects to be entitled in exchange for performance obligations upon transfer of control to the customer, excluding amounts collected on behalf of other third parties and sales taxes. The amount of consideration to which the Company expects to be entitled varies as a result of rebates, chargebacks, returns and other allowances. The cumulative effect of initially applying the new revenue standard was immaterial for the quarter ended March 31, 2018, based on the adoption of ASC 606. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company establishes an allowance for doubtful accounts to ensure trade and financing receivables are not overstated due to uncollectability. The allowance for doubtful accounts was based on specific receivables, which their collection, in the opinion of Company’s management, is in doubt. Trade receivables are charged off in the period in which they are deemed to be uncollectible. As of March 31, 2018, and December 31, 2017, the allowance for doubtful accounts amounted to $314 and $0, respectively. |
Reclassifications | Reclassifications Certain balance sheet amounts and cash flow amounts have been reclassified to conform with the current year presentation. |
Inventories | Inventories Inventories of raw materials are stated at the lower of cost (first-in, first-out basis) or realizable value. Cost of work in process is comprised of direct materials, direct production costs and an allocation of production overhead based on normal operating capacity. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated by the straight-line method over their estimated useful lives. Annual rates of depreciation are as follows: Leasehold improvements Over the shorter of the lease term or Machinery and equipment 7-14 years Furniture and fixtures 10-14 years Transportation equipment 7 years Computer equipment 3 years |
Stock Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation under the fair market value method under which compensation cost is measured at the grant date based on the value of the award and is recognized over the vesting period, which is usually the service period. For stock options, fair value is determined using an option-pricing model that takes into account the stock price at the grant date, the exercise price, the expected life of the option, the volatility of the underlying stock, the expected dividends on it, and the risk-free interest rate over the expected life of the option. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to statements of income as incurred net of grants from the Israel Innovation Authority (formerly known as the Israel Office of the Chief Scientist of the Ministry of Economy). |
Loss per Share | Loss per Share Basic net earnings per share are computed based on the weighted average number of shares of common stock outstanding during each year. |
Long-Lived Assets and Intangible assets | Long-Lived Assets and Intangible assets Intangible assets that are not considered to have an indefinite useful life are amortized using the straight-line basis over their estimated useful lives. The Company evaluates property and equipment and purchased intangible assets with finite lives for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flow and recognizes an impairment loss when the estimated undiscounted future cash flow expected to result from the use of the asset plus the net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When the Company identifies an impairment, it reduces the carrying amount of the asset to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. During the three months ended March 31, 2018, and the year ended December 31, 2017, no indicators of impairment have been identified. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill is not amortized, but rather is subject to an annual impairment test. The Company has one continued operation, consisting of the MRM segment, and the entire goodwill was allocated to this MRM segment. The goodwill impairment tests are conducted in two steps. In the first step, the Company determines the fair value of the reporting unit. If the net book value of the reporting unit exceeds its fair value, the Company would then perform the second step of the impairment test which requires allocation of the reporting unit’s fair value of all of its assets and liabilities in a manner similar to an acquisition cost allocation, with any residual fair value being allocated to goodwill. The implied fair value of the goodwill is then compared to the carrying value to determine impairment, if any. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Financial Accounting Standards Board, or FASB, ASC 220-10, “Reporting Comprehensive Income,” requires the Company to report in its consolidated financial statements, in addition to its net income, comprehensive income (loss), which includes all changes in equity during a period from non-owner sources including, as applicable, foreign currency items and other items. The Company’s other comprehensive income for all periods presented is related to the translation from functional currency to the presentation currency. |
Income Taxes | Income Taxes Deferred taxes are determined utilizing the “asset and liability” method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance when it is more likely than not that deferred tax assets will not be realized in the foreseeable future. The Company applied FASB ASC Topic 740-10-25, “Income Taxes,” which provides guidance for recognizing and measuring uncertain tax positions and prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognizing, classification and disclosure of these uncertain tax positions. The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense. |
Financial Instruments | Financial Instruments 1. Concentration of credit risks: Financial instruments that have the potential to expose the Company to credit risks are mainly cash and cash equivalents, bank deposit accounts, marketable securities and trade receivables. The Company holds cash and cash equivalents, securities and deposit accounts at large banks in Israel, thereby substantially reducing the risk of loss. With respect to trade receivables, the risk is limited due to the geographical spreading, nature and size of the entities that constitute the Company’s customer base. The Company assesses the financial position of its customers prior to the engagement with them. The Company performs ongoing credit evaluations of its customers for the purpose of determining the appropriate allowance for doubtful accounts and generally does not require collateral. An appropriate allowance for doubtful accounts is included in the accounts. 2. Fair value measurement: The Company measures fair value and discloses fair value measurements for financial and non-financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update, or ASU, No. 2016-02, which supersedes the lease accounting guidance in ASC 840, “Leases.” The new guidance requires lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. The guidance is effective for reporting periods (interim and annual) beginning after December 15, 2018, for public companies, with early adoption permitted. The new guidance must be adopted using a modified retrospective approach. We are currently assessing the potential impact of this ASU on our consolidated financial position and results of operations. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Schedule of annual rates of depreciation | Leasehold improvements Over the shorter of the lease term or Machinery and equipment 7-14 years Furniture and fixtures 10-14 years Transportation equipment 7 years Computer equipment 3 years |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Measurements [Abstract] | |
Schedule of fair value measurements | Fair value measurements using input type March 31, 2018 Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 3,379 - - 3,379 Restricted cash 237 - - 237 Derivative assets - 57 - 57 Derivative liabilities - phantom option - (10 ) - (10 ) Total $ 3,616 47 - 3,663 Fair value measurements using input type December 31, 2017 Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 2,114 $ - $ - $ 2,114 Restricted cash 284 - - 284 Derivative liability - 3 - 3 Derivative liability- phantom option - (11 ) - (11 ) Total 2,398 $ (8 ) $ - $ 2,390 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Inventories [Abstract] | |
Schedule of inventories | March 31, 2018 December 31, 2017 Raw materials $ 3,177 $ 3,189 Work in process 1,922 1,790 $ 5,099 $ 4,979 |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segments [Abstract] | |
Schedule of total revenue by geographic area | Three months ended 2018 2017 United States $ 5,120 $ 2,287 Israel 1 20 Other 859 394 Total $ 5,980 $ 2,701 |
Discontinued Operation (Tables)
Discontinued Operation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Discontinued Operation [Abstract] | |
Schedule of composition from discontinued operation | March 31, 2018 December 31, 2017 ASSETS Current assets: Cash and cash equivalents $ 139 $ 279 Restricted cash 4,343 4,224 Trade accounts receivable, net 4,844 4,807 Inventories 1,646 1,506 Other accounts receivable 13 66 Total current assets 10,985 10,882 Property and equipment, net 650 676 Long-term Assets 95 98 Total long-term assets 745 774 Total assets $ 11,730 $ 11,656 March 31, 2018 December 31, 2017 LIABILITIES Short-term bank credit $ 8,596 8,863 Trade accounts payable 1,491 1,380 Other accounts payable 1,098 957 Total current liabilities 11,185 11,200 Accrued severance pay, net 134 138 Total Liabilities $ 11,319 11,338 Three months ended 2018 2017 Revenues $ 2,578 2,558 Cost of revenues 1,931 2,245 Gross profit 647 313 Operating expenses: Research and development 58 136 Selling and marketing 119 153 General and administrative 260 344 Total operating expenses 437 633 Profit (loss) from operations 210 (320 ) Finance income (expense), net 99 (200 ) Profit (loss) before provision for income taxes 111 (520 ) Taxes on income - 75 Net profit (loss) 111 (595 ) Three months ended 2018 2017 Net cash provided by (used in) operating activities $ 255 (2,006 ) Net cash provided by (used in) investing activities (10 ) (15 ) Net cash provided by (used in) financing activities (266 ) 2,295 NET CASH INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH (21 ) 274 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF THE PERIOD 4,503 4,023 TRANSLATION ADJUSTMENT OF CASH AND CASH EQUIVALENTS CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF THE PERIOD $ 4,482 4,297 |
Description of Business (Detail
Description of Business (Details) - ILS (₪) | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2017 | Feb. 23, 2017 | Dec. 31, 2017 | Mar. 31, 2018 | |
Description of Business (Textual) | ||||
Sale of an aggregate shares of gross proceeds | 6,100,000 | |||
Ordinary shares for aggregate gross proceeds | ₪ 9,844,020 | |||
Irrevocable proxy assigning his voting power | 45,000 | |||
Voting interest of Micronet increased | 50.07% | |||
Share purchase agreement, description | The Company, Enertec and our wholly owned subsidiary, Enertec Management Ltd., entered into a Share Purchase Agreement, or the Share Purchase Agreement, with Coolisys Technologies Inc., or Coolisys, a subsidiary of DPW Holdings, Inc., or DPW, pursuant to which we agreed to sell the entire share capital of Enertec to Coolisys. As consideration for the sale of Enertec's entire share capital, Coolisys has agreed to pay, at the closing of the transaction, a purchase price of $5,250 as well as assume up to $4,000 of Enertec debt which consideration may be subject to certain adjustments set forth in the Share Purchase Agreement. | |||
Minimum [Member] | ||||
Description of Business (Textual) | ||||
Ownership interest in Micronet, diluted | 49.31% | |||
Maximum [Member] | ||||
Description of Business (Textual) | ||||
Ownership interest in Micronet, diluted | 62.90% | |||
Micronet Ltd. [Member] | ||||
Description of Business (Textual) | ||||
Ownership percentage | 50.07% | |||
Purchased an additional shares | 140,000 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Machinery and equipment [Member] | Minimum [Member] | |
Schedule of annual rates of depreciation | |
Property and equipment, estimated useful lives | 7 years |
Machinery and equipment [Member] | Maximum [Member] | |
Schedule of annual rates of depreciation | |
Property and equipment, estimated useful lives | 14 years |
Furniture and fixtures [Member] | Minimum [Member] | |
Schedule of annual rates of depreciation | |
Property and equipment, estimated useful lives | 10 years |
Furniture and fixtures [Member] | Maximum [Member] | |
Schedule of annual rates of depreciation | |
Property and equipment, estimated useful lives | 14 years |
Transportation equipment [Member] | |
Schedule of annual rates of depreciation | |
Property and equipment, estimated useful lives | 7 years |
Computer equipment [Member] | |
Schedule of annual rates of depreciation | |
Property and equipment, estimated useful lives | 3 years |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Summary of Significant Accounting Policies (Textual) | ||
Allowance for doubtful accounts | $ 314 | $ 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Fair value measurements using input type | ||
Cash and cash equivalents | $ 3,379 | $ 2,114 |
Restricted cash | 237 | 284 |
Derivative assets | 57 | |
Derivative liability | 3 | |
Derivative liability- phantom option | (10) | (11) |
Fair value measurements, Total | 3,663 | 2,390 |
Level 1 [Member] | ||
Fair value measurements using input type | ||
Cash and cash equivalents | 3,379 | 2,114 |
Restricted cash | 237 | 284 |
Derivative assets | ||
Derivative liability | ||
Derivative liability- phantom option | ||
Fair value measurements, Total | 3,616 | 2,398 |
Level 2 [Member] | ||
Fair value measurements using input type | ||
Cash and cash equivalents | ||
Restricted cash | ||
Derivative assets | 57 | |
Derivative liability | 3 | |
Derivative liability- phantom option | (10) | (11) |
Fair value measurements, Total | 47 | (8) |
Level 3 [Member] | ||
Fair value measurements using input type | ||
Cash and cash equivalents | ||
Restricted cash | ||
Derivative assets | ||
Derivative liability | ||
Derivative liability- phantom option | ||
Fair value measurements, Total |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Schedule of inventories | ||
Raw materials | $ 3,177 | $ 3,189 |
Work in process | 1,922 | 1,790 |
Inventories | $ 5,099 | $ 4,979 |
Segments (Details)
Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenue from customers in geographic regions | ||
Total | $ 5,980 | $ 2,701 |
United States [Member] | ||
Revenue from customers in geographic regions | ||
Total | 5,120 | 2,287 |
Israel [Member] | ||
Revenue from customers in geographic regions | ||
Total | 1 | 20 |
Other [Member] | ||
Revenue from customers in geographic regions | ||
Total | $ 859 | $ 394 |
Loans from Others (Details)
Loans from Others (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended |
Mar. 29, 2018 | Mar. 31, 2018 | |
Loan from Others (Textual) | ||
Fees and expenses | $ 273,787 | |
Extinguishment of the existing debt expenses | $ 360 | |
Securities Purchase Agreement [Member] | ||
Loan from Others (Textual) | ||
Securities purchase agreement , description | The Company and its subsidiary, Enertec Electronics Ltd., or Enertec Electronics, executed and closed on a securities purchase agreement with YA II PN Ltd, or YA II, whereby the Company issued and sold to YA II (1) certain Series A Convertible Debentures in the aggregate principal aggregate amount of $3,200, or the Series A Debentures, and (2) a Series B Convertible Debenture in the principal aggregate amount of $1,800, or the Series B Debenture. The Series A Debentures were issued in exchange for the cancellation and retirement of certain promissory notes issued by the Company to YA II on October 28, 2016, December 22, 2016, June 8, 2017 and August 22, 2017, or collectively, the Prior Notes, with a total outstanding aggregate principal amount of $3,200. The Series B Debenture was issued and sold for aggregate gross cash proceeds of $1,800. | |
Securities Purchase Agreement [Member] | YA II [Member] | ||
Loan from Others (Textual) | ||
Securities purchase agreement , description | Pursuant to the terms of the securities purchase agreement, the Company agreed to issue to YA II a warrant to purchase 375,000 shares of the Company's common stock at a purchase price of $2.00 per share, a warrant to purchase 200,000 shares of the Company's common stock at a purchase price of $3.00 per share and a warrant to purchase 112,500 shares of the Company's common stock at a purchase price of $4.00 per share, or collectively, the Warrants. |
Discontinued Operation (Details
Discontinued Operation (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||||
Cash and cash equivalents | $ 4,482 | $ 4,503 | $ 4,297 | $ 4,023 |
Restricted cash | 4,343 | 4,224 | ||
Trade accounts receivable, net | 4,844 | 4,807 | ||
Inventories | 1,646 | 1,506 | ||
Other accounts receivable | 13 | 66 | ||
Total current assets | 10,985 | 10,882 | ||
Property and equipment, net | 650 | 676 | ||
Long-term Assets | 95 | 98 | ||
Total long-term assets | 745 | 774 | ||
Total assets | 11,730 | 11,656 | ||
LIABILITIES | ||||
Short-term bank credit | 8,596 | 8,863 | ||
Trade accounts payable | 1,491 | 1,380 | ||
Other accounts payable | 1,098 | 957 | ||
Total current liabilities | 11,185 | 11,200 | ||
Accrued severance pay, net | 134 | 138 | ||
Total Liabilities | $ 11,319 | $ 11,338 |
Discontinued Operation (Detai29
Discontinued Operation (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Discontinued Operation [Abstract] | ||
Revenues | $ 2,578 | $ 2,558 |
Cost of revenues | 1,931 | 2,245 |
Gross profit | 647 | 313 |
Operating expenses: | ||
Research and development | 58 | 136 |
Selling and marketing | 119 | 153 |
General and administrative | 260 | 344 |
Total operating expenses | 437 | 633 |
Profit (loss) from operations | 210 | (320) |
Finance income (expense), net | 99 | (200) |
Profit (loss) before provision for income taxes | 111 | (520) |
Taxes on income | 75 | |
Net profit (loss) | $ 111 | $ (595) |
Discontinued Operation (Detai30
Discontinued Operation (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Discontinued Operation [Abstract] | ||
Net cash provided by (used in) operating activities | $ 255 | $ (2,006) |
Net cash provided by (used in) investing activities | (10) | (15) |
Net cash provided by (used in) financing activities | (266) | 2,295 |
NET CASH INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (21) | 274 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF THE PERIOD | 4,503 | 4,023 |
TRANSLATION ADJUSTMENT OF CASH AND CASH EQUIVALENTS | ||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF THE PERIOD | $ 4,482 | $ 4,297 |
Discontinued Operation (Detai31
Discontinued Operation (Details Textual) $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($)shares | |
Discontinued Operation (Textual) | |
Purchase price | $ 5,250 |
Enertec debt | $ 4,000 |
Consulting agreement, description | The Company, Enertec, Coolisys, DPW and Mr. David Lucatz, the Company's Chief Executive Officer, agreed to execute a consulting agreement, or the Consulting Agreement, whereby the Company, via Mr. Lucatz, will provide Enertec with certain consulting and transitional services over a 3 year period as necessary and requested by Coolisys (but in no event to exceed 20% of Mr. Lucatz's time) |
Class A common stock [Member] | |
Discontinued Operation (Textual) | |
Restricted shares of DPW | shares | 150,000 |
Enertec Systems [Member] | |
Discontinued Operation (Textual) | |
Consulting fees | $ 150 |
Subsequent Events (Details)
Subsequent Events (Details) | May 08, 2018 |
Subsequent Event [Member] | |
Subsequent Events (Textual) | |
Conversion of shares,description | The Company and YA II amended the terms of the Series A Debentures and Series B Debenture to clarify that YA II shall not have the right to convert the Series A Debentures and Series B Debenture into shares of the Company's common stock in an amount to exceed 19.99% of the Company's issued and outstanding shares of common stock as of February 22, 2018 |