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SUPPLEMENTAL PURCHASE AGREEMENT TRANSACTION INFORMATION | 3 Months Ended
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Mar. 31, 2023
SUPPLEMENTAL PURCHASE AGREEMENT TRANSACTION INFORMATION |
SUPPLEMENTAL ASSET PURCHASE TRANSACTION INFORMATION | 10. SUPPLEMENTAL PURCHASE AGREEMENT TRANSACTION INFORMATION Historical financial information for Breckenridge was derived from Breckenridge’s unaudited financial statements. In the opinion of the Company’s management, the financial information of Breckenridge reflects all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. The non-cash items associated with the Purchase Agreement (unaudited and in thousands) shown on the Condensed Consolidated Statements of Cash Flows consist of “Deemed distribution (contribution)” and “Acquisition of Breckenridge net assets” and are derived as follows:
​ | ​ | ​ | ​ | ​ | ​ | ​
Deemed Distribution (Contribution) | ​ | Three Months Ended March 31,
​ |  | 2023 |  | 2022
Deemed distribution (contribution) of short-term investments | ​ | $ | 1,000 | ​ | $ | —
Deemed distribution (contribution) of accounts receivable | ​ |  | 1,015 | ​ |  | (2,605)
Deemed distribution (contribution) of prepaids and other | ​ |  | 1 | ​ |  | (133)
Deemed distribution (contribution) of land and buildings | ​ | ​ | 514 | ​ | ​ | (4,726)
Deemed (distribution) contribution of accounts payable | ​ | ​ | (132) | ​ | ​ | 196
Deemed (distribution) contribution of accrued liabilities | ​ | ​ | (69) | ​ | ​ | 228
Deemed (distribution) contribution of deferred revenue | ​ | ​ | — | ​ | ​ | 568
Deemed distribution of Breckenridge net assets not acquired | ​ | $ | 2,329 | ​ | ​ | ​
Deemed contribution of Breckenridge net assets | ​ | ​ | ​ | ​ | $ | (6,472)
​
​ | ​ | ​ | ​
Historical Carrying Value of Assets Acquired | ​ | March 24, 2023
Accounts receivable, net | ​ | $ | 67
Prepaid expenses and other current assets | ​ | ​ | 56
Property and equipment, net | ​ | ​ | 1,322
Other accrued liabilities | ​ | ​ | (16)
Deferred revenue | ​ | ​ | (94)
Acquisition of Breckenridge net assets | ​ | $ | 1,335
​ Total consideration for the asset purchase (in thousands) is as follows: ​
​ | ​ | ​ | ​
Consideration Paid | ​ | March 24, 2023
Common stock issued | ​ | $ | 2,020
Note payable issued | ​ | ​ | 9,880
Purchase price | ​ | $ | 11,900
​ Because the Transaction constitutes a transaction among entities under common control, the excess purchase price over the historical carrying value of the net assets acquired was recorded as a charge to additional paid in capital. The excess purchase price over the historical carrying value of the assets at the acquisition date (unaudited and in thousands) is as follows: ​
​ | ​ | ​ | ​
Excess Purchase Price | ​ | March 24, 2023
Purchase price | ​ | $ | 11,900
Historical carrying value of assets acquired | ​ | ​ | (1,335)
Excess purchase price | ​ | $ | 10,565
​ The following table reconciles the previously reported Balance Sheet at December 31, 2022 to the current Balance Sheet for the same period:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | December 31, 2022
​ | Dawson | ​ | Breckenridge | ​ | Dawson
​ | Previously Reported | ​ | ​ | ​ | As Adjusted
​ | ​ | ​ | (unaudited) | ​ | (unaudited)
Assets | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Current assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash and cash equivalents | $ | 13,914 | ​ | $ | 4,689 | ​ | $ | 18,603
Restricted cash | ​ | 5,000 | ​ | ​ | — | ​ | ​ | 5,000
Short-term investments | ​ | 265 | ​ | ​ | — | ​ | ​ | 265
Accounts receivable, net | ​ | 6,945 | ​ | ​ | 1,027 | ​ | ​ | 7,972
Employee retention credit receivable | ​ | 3,035 | ​ | ​ | — | ​ | ​ | 3,035
Prepaid expenses and other current assets | ​ | 8,876 | ​ | ​ | 75 | ​ | ​ | 8,951
Total current assets | ​ | 38,035 | ​ | ​ | 5,791 | ​ | ​ | 43,826
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Property and equipment, net | ​ | 18,127 | ​ | ​ | 2,341 | ​ | ​ | 20,468
Right-of-use assets | ​ | 4,010 | ​ | ​ | — | ​ | ​ | 4,010
Intangibles, net | ​ | 369 | ​ | ​ | — | ​ | ​ | 369
Total assets | $ | 60,541 | ​ | $ | 8,132 | ​ | $ | 68,673
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Liabilities and Stockholders' Equity | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Current liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Accounts payable | $ | 4,015 | ​ | $ | 125 | ​ | $ | 4,140
Accrued liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Payroll costs and other taxes | ​ | 1,973 | ​ | ​ | 28 | ​ | ​ | 2,001
Other | ​ | 1,178 | ​ | ​ | 102 | ​ | ​ | 1,280
Deferred revenue | ​ | 7,199 | ​ | ​ | 181 | ​ | ​ | 7,380
Current maturities of notes payable and finance leases | ​ | 275 | ​ | ​ | — | ​ | ​ | 275
Current maturities of operating lease liabilities | ​ | 1,118 | ​ | ​ | — | ​ | ​ | 1,118
Total current liabilities | ​ | 15,758 | ​ | ​ | 436 | ​ | ​ | 16,194
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Long-term liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Notes payable and finance leases, net of current maturities | ​ | 207 | ​ | ​ | — | ​ | ​ | 207
Operating lease liabilities, net of current maturities | ​ | 3,331 | ​ | ​ | — | ​ | ​ | 3,331
Deferred tax liabilities, net | ​ | 136 | ​ | ​ | 1 | ​ | ​ | 137
Total long-term liabilities | ​ | 3,674 | ​ | ​ | 1 | ​ | ​ | 3,675
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Stockholders' equity: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Common stock | ​ | 238 | ​ | ​ | — | ​ | ​ | 238
Additional paid-in capital | ​ | 155,413 | ​ | ​ | — | ​ | ​ | 155,413
Accumulated deficit | ​ | (112,469) | ​ | ​ | — | ​ | ​ | (112,469)
Equity of Breckenridge prior to acquisition | ​ | — | ​ | ​ | 7,695 | ​ | ​ | 7,695
Accumulated other comprehensive loss, net | ​ | (2,073) | ​ | ​ | — | ​ | ​ | (2,073)
Total stockholders' equity | ​ | 41,109 | ​ | ​ | 7,695 | ​ | ​ | 48,804
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total liabilities and stockholders' equity | $ | 60,541 | ​ | $ | 8,132 | ​ | $ | 68,673
The following table reconciles the previously reported Statement of Operations for the three months ended March 31, 2022 to the current Statement of Operations for the same period:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | Three Months Ended March 31, 2022
​ | Dawson | ​ | Breckenridge | ​ | Eliminations | ​ | Dawson
​ | Previously Reported | ​ | ​ | ​ | ​ | ​ | ​ | As Adjusted
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating revenues | $ | 18,359 | ​ | $ | 4,902 | ​ | $ | (1,327) | ​ | $ | 21,934
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating costs: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating expenses | ​ | 12,638 | ​ | ​ | 3,092 | ​ | ​ | (1,327) | ​ | ​ | 14,403
General and administrative | ​ | 5,531 | ​ | ​ | 337 | ​ | ​ | — | ​ | ​ | 5,868
Depreciation and amortization | ​ | 2,634 | ​ | ​ | 467 | ​ | ​ | — | ​ | ​ | 3,101
​ | ​ | 20,803 | ​ | ​ | 3,896 | ​ | ​ | (1,327) | ​ | ​ | 23,372
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(Loss) income from operations | ​ | (2,444) | ​ | ​ | 1,006 | ​ | ​ | — | ​ | ​ | (1,438)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other income (expense): | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest income | ​ | 25 | ​ | ​ | 1 | ​ | ​ | — | ​ | ​ | 26
Interest expense | ​ | (11) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (11)
Other income (expense), net | ​ | 39 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 39
(Loss) income before income tax | ​ | (2,391) | ​ | ​ | 1,007 | ​ | ​ | — | ​ | ​ | (1,384)
Income tax expense | ​ | — | ​ | ​ | (1) | ​ | ​ | — | ​ | ​ | (1)
Net (loss) income | ​ | (2,391) | ​ | ​ | 1,006 | ​ | ​ | — | ​ | ​ | (1,385)
Other comprehensive loss: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net unrealized loss on foreign exchange rate translation | ​ | (233) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (233)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Comprehensive (loss) income | $ | (2,624) | ​ | $ | 1,006 | ​ | $ | — | ​ | $ | (1,618)
Basic loss per share of common stock | $ | (0.10) | ​ | $ | — | ​ | $ | — | ​ | $ | (0.06)
Diluted loss per share of common stock | $ | (0.10) | ​ | $ | — | ​ | $ | — | ​ | $ | (0.06)
Weighted average equivalent common shares outstanding | ​ | 23,692,558 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 24,709,159
Weighted average equivalent common shares outstanding | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
- assuming dilution | ​ | 23,692,558 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 24,709,159
The following table reconciles the previously reported Statement of Cash Flows for the three months ended March 31, 2022 to the current Statement of Cash Flows for the same period:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | Three Months Ended March 31, 2022
​ | Dawson | ​ | Breckenridge | ​ | Dawson
​ | Previously Reported | ​ | ​ | ​ | As Adjusted
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash flows from operating activities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net (loss) income | $ | (2,391) | ​ | $ | 1,006 | ​ | $ | (1,385)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Depreciation and amortization | ​ | 2,634 | ​ | ​ | 467 | ​ | ​ | 3,101
Operating lease cost | ​ | 255 | ​ | ​ | — | ​ | ​ | 255
Non-cash compensation | ​ | 279 | ​ | ​ | — | ​ | ​ | 279
Gain on disposal of assets | ​ | (10) | ​ | ​ | — | ​ | ​ | (10)
Remeasurement and other | ​ | (23) | ​ | ​ | — | ​ | ​ | (23)
Change in operating assets and liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Increase in accounts receivable | ​ | (9,851) | ​ | ​ | (1,907) | ​ | ​ | (11,758)
Decrease (increase) in prepaid expenses and other assets | ​ | 78 | ​ | ​ | (7) | ​ | ​ | 71
(Decrease) increase in accounts payable | ​ | (576) | ​ | ​ | 2,416 | ​ | ​ | 1,840
Increase in accrued liabilities | ​ | 47 | ​ | ​ | 104 | ​ | ​ | 151
Decrease in operating lease liabilities | ​ | (247) | ​ | ​ | — | ​ | ​ | (247)
Decrease in deferred revenue | ​ | (855) | ​ | ​ | (568) | ​ | ​ | (1,423)
Net cash (used in) provided by operating activities | ​ | (10,660) | ​ | ​ | 1,511 | ​ | ​ | (9,149)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash flows from investing activities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Capital expenditures | ​ | (28) | ​ | ​ | — | ​ | ​ | (28)
Proceeds from disposal of assets | ​ | 10 | ​ | ​ | — | ​ | ​ | 10
Net cash used in investing activities | ​ | (18) | ​ | ​ | — | ​ | ​ | (18)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash flows from financing activities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Principal payments on notes payable | ​ | (328) | ​ | ​ | — | ​ | ​ | (328)
Principal payments on finance leases | ​ | (9) | ​ | ​ | — | ​ | ​ | (9)
Tax withholdings related to stock-based compensation awards | ​ | (79) | ​ | ​ | — | ​ | ​ | (79)
Sale of treasury stock | ​ | 113 | ​ | ​ | — | ​ | ​ | 113
Breckenridge cash contributions prior to acquisition | ​ | — | ​ | ​ | 1,950 | ​ | ​ | 1,950
Net cash (used in) provided by financing activities | ​ | (303) | ​ | ​ | 1,950 | ​ | ​ | 1,647
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Effect of exchange rate changes on cash and cash equivalents and restricted cash | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net (decrease) increase in cash and cash equivalents and restricted cash | ​ | (10,981) | ​ | ​ | 3,461 | ​ | ​ | (7,520)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash and cash equivalents and restricted cash at beginning of period | ​ | 30,376 | ​ | ​ | — | ​ | ​ | 30,376
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash and cash equivalents and restricted cash at end of period | $ | 19,395 | ​ | $ | 3,461 | ​ | $ | 22,856
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Supplemental cash flow information: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash paid for interest | $ | 11 | ​ | $ | — | ​ | $ | 11
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Non-cash operating, investing and financing activities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Increase in right-of-use assets and operating lease liabilities | $ | 527 | ​ | $ | — | ​ | $ | 527
Financed insurance premiums | $ | 944 | ​ | $ | — | ​ | $ | 944
Deemed contribution of Breckenridge net assets | $ | — | ​ | $ | (6,472) | ​ | $ | (6,472)
​ The following table details the standalone Breckenridge Statement of Operations for the three months ended March 31, 2023:
​ | ​ | ​ | ​
​ | ​ | ​ | ​
​ | ​ | March 31, 2023
​ | ​ | ​ | ​
Operating revenues | ​ | $ | 782
​ | ​ | ​ | ​
Operating costs: | ​ | ​ | ​
Operating expenses | ​ | ​ | 806
General and administrative | ​ | ​ | 438
Depreciation and amortization | ​ | ​ | 505
​ | ​ | ​ | 1,749
​ | ​ | ​ | ​
Loss from operations | ​ | ​ | (967)
​ | ​ | ​ | ​
Other income (expense): | ​ | ​ | ​
Interest income | ​ | ​ | 2
Interest expense | ​ | ​ | —
Other (expense) income, net | ​ | ​ | (11)
Loss before income tax | ​ | ​ | (976)
Income tax benefit | ​ | ​ | —
Net loss | ​ | $ | (976)
​

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- Definition The entire disclosure for asset acquisition. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 50 -Section 15 -Paragraph 3 -URI https://asc.fasb.org/extlink&oid=6911878&loc=d3e8732-128492 + Details
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