美國
證券交易委員會
華盛頓特區20549
|
表格
|
(做一個標記)
| 根據1934年證券交易法第13或15(d)條款的季度報告。 |
截至2024年6月30日季度結束
或
| 根據1934年證券交易法第13或15(d)條款的過渡報告 |
轉型期從 到
委員會文件編號
| （根據其組織憲章規定的正式名稱） |
|
（成立或組織的）州或其他轄區 或組織成立的州或其他司法管轄區) |
(國稅局雇主 識別號碼) | |
|
|
||
| （總執行辦公室地址） | (郵遞區號) | |
| ( | ||
| （註冊人的電話號碼，包括區號） | ||
(以前的名稱，以前的地址及以前的財政年度，如自上次報告以來有更改)
根據《證券法》第12(b)條註冊的證券：
| 每種類別的名稱 | 交易標的（s） |
每個交易所的名稱 已登記 |
| The 資本市場 | ||
| The |
請以勾選的方式指明登記人是否：
(1) 在前12個月內（或登記人被要求提交此類報告的較短期間內）已提交根據1934年證券交易法第13條或15(d)條所要求的所有報告，並且(2) 在過去90天內已受到此類提交要求。
請勾選標示，該登記人是否在過去12個月內（或在登記人要求提交這些檔案的較短期間內）電子提交了根據規則405的顯示數據檔案（本章第232.405條所要求）。
請勾選註冊人是否為大型加速報告人、加速報告人、非加速報告人、較小報告公司或新興增長公司。 請參見《交易所法》第120億2條中對「大型加速報告人」、「加速報告人」、「較小報告公司」以及「新興增長公司」的定義。
| 大型快速進入文件 | o | 加速進入文件 | o | |
| x | 小型報告公司 | |||
| 新興成長型公司 |
如果是新兴成长型公司，請勾選表示公司選擇不使用根據《交易法》第13(a)條所規定的提供的遵守任何新的或修訂的財務會計準則的延長過渡期。o
請勾選表示，登記申報人是否為殼公司（依據《交易所法》第120億2條定義）。 是o
請指示每一個發行人的普通股類別在最近可行日期的流通股數： 2024年11月4日的流通普通股數。
| 2 |
| 第I部分 - 財務資訊 | ||
| ITEm 1. | 基本報表 | 4 |
| 合併資產負債表（未經審計）。 | 4 | |
| 合併損益表（未經審計）。 | 6 | |
| 綜合損益表（未經審核） | 7 | |
| 合併現金流量表（未經審計）。 | 8 | |
| 股東權益彙總表（未經查核） | 10 | |
| 附註股東權益基本報表（未經審核） | 12 | |
| ITEm 2. | 管理層對財務狀況和營運成果的討論與分析 | 30 |
| 項目 3。 | 有關市場風險的定量和定性披露 | 38 |
| 項目 4。 | 內部控制及程序 | 38 |
| 第二部分 - 其他信息 | ||
| ITEm 1. | 法律訴訟 | 39 |
| 項目1A. | 風險因素 | 39 |
| ITEm 2. | 股票權益的未註冊銷售和資金用途 | 40 |
| 項目 3。 | 優先證券違約 | 40 |
| 項目 4。 | 礦業安全披露 | 40 |
| 條目 5。 | 其他資訊 | 41 |
| 條目 6。 | 展品 | 41 |
| 簽名 | 42 | |
| 3 |
第一部分——財務報表
項目 1.
VerifyMe公司
合併資產負債表
（單位：千美元，以股份數據爲單位）
| 截至 | ||||||||
| 2024年9月30日 | 2023年12月31日 | |||||||
| (未經審計) | ||||||||
| 資產 | ||||||||
| 流動資產 | ||||||||
| 現金及現金等價物，包括受限制現金 | $ | $ | ||||||
| 應收賬款，扣除信用損失準備金後，$ | ||||||||
| 未帳單收入 | ||||||||
| 預付費用及其他流動資產 | ||||||||
| 存貨 | ||||||||
| 總流動資產 | ||||||||
| 固定資產淨額 | $ | $ | ||||||
| 使用權資產 | ||||||||
| 無形資產，淨額 | ||||||||
| 商譽 | ||||||||
| 資產總計 | $ | $ | ||||||
| 負債和股東權益 | ||||||||
| 流動負債 | ||||||||
| 定期票據，當前 | $ | $ | ||||||
| 應付賬款 | ||||||||
| 其他應計費用 | ||||||||
| 租賃負債-流動 | ||||||||
| 或有負債-流動 | ||||||||
| 流動負債合計 | ||||||||
| 開多期債務 | ||||||||
| 或有負債，非流動 | $ | $ | ||||||
| 長期租賃負債 | ||||||||
| 定期票據 | ||||||||
| 可轉換票據 – 關聯方 | ||||||||
| 可轉換票據 | ||||||||
| 負債合計 | $ | $ | ||||||
| 股東權益 | ||||||||
| A類可轉換優先股，$ 面值， 授權股份數; 截至2024年9月30日和2023年12月31日分別已發行和流通的股份 | ||||||||
| 普通股，面值爲10,453,315美元。 面值； 授權股份數; 截至2024年9月30日和2023年12月31日分別已發行和流通的股份 | ||||||||
| 4 |
| 普通股票，$ 面值； 授權； 和 發行， 和 截至2024年9月30日和2023年12月31日的流通股數，分別是 | ||||||||
| 額外實收資本 | ||||||||
| 以成本計算的庫存股; 和 截止2024年9月30日和2023年12月31日的股份 | ( | ) | ( | ) | ||||
| 累計虧損 | ( | ) | ( | ) | ||||
| 累計其他綜合損失 | ( | ) | ( | ) | ||||
| 股東權益 | ||||||||
| 總負債和股東權益 | $ | $ |
附註是這些未經審計的合併基本報表的一個重要部分。
| 5 |
VerifyMe, Inc.
合併運營報表
(未經審計)
（以千爲單位，除股票數據外）
| 截至三個月 | 截至九個月 | |||||||||||||||
| 2024年9月30日 | 2023年9月30日 | 2024年9月30日 | 2023年9月30日 | |||||||||||||
| 淨營業收入 | $ | $ | $ | $ | ||||||||||||
| 營業成本(a) | ||||||||||||||||
| 毛利潤 | ||||||||||||||||
| 營業費用 | ||||||||||||||||
| 部門管理和科技(a) | ||||||||||||||||
| 一般及行政費用 (a) | ||||||||||||||||
| 研究和開發 | ||||||||||||||||
| 銷售和營銷 (a) | ||||||||||||||||
| 商譽及無形資產減值 | ||||||||||||||||
| 總營業費用 | ||||||||||||||||
| 其他收入（費用）之前的虧損 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 其他（費用）收入 | ||||||||||||||||
| 利息費用，淨額 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 權益投資的未實現損失 | ( | ) | ||||||||||||||
| 或有對價公允價值變動 | ( | ) | ||||||||||||||
| 其他費用，淨額 | ( | ) | ||||||||||||||
| 其他收入（費用）合計，淨額 | ( | ) | ||||||||||||||
| 淨損失 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| 每股虧損 | ||||||||||||||||
| 基本 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 攤薄 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 加權平均普通股在外流通 | ||||||||||||||||
| 基本 | ||||||||||||||||
| 攤薄 | ||||||||||||||||
| (a) |
附註是這些未經審計的合併基本報表的一個重要部分。
| 6 |
VerifyMe, Inc.
合併全面損益表 損失
（未經審計）
(以千計)
| 三個月結束 | 截至九個月 | |||||||||||||||
| 2024年9月30日 | 2023年9月30日 | 2024年9月30日 | 2023年9月30日 | |||||||||||||
| 淨虧損 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| 利率互換的公允價值變動 | ||||||||||||||||
| 外幣翻譯調整 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 綜合總損失 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
附帶說明是這些未經審計的合併基本報表的組成部分。
| 7 |
VerifyMe, Inc.
合併現金流量表
（未經審計）
(以千計)
| 截至九個月 | ||||||||
| 2024年9月30日 | 2023年9月30日 | |||||||
| 經營活動產生的現金流量 | ||||||||
| 淨虧損 | $ | ( | ) | $ | ( | ) | ||
| 調整淨虧損與經營活動提供的（使用的）現金流的調節 : | ||||||||
| 壞賬準備 | ||||||||
| 股票基礎補償 | ||||||||
| 尚未實現的股權投資損失 | ||||||||
| 或有對價公允價值變動 | ( | ) | ( | ) | ||||
| 用於服務的限制性股票獎勵和限制性股票單位的公允價值 | ||||||||
| 設備處置損失 | ||||||||
| 商譽和無形資產減值 | ||||||||
| 攤銷和折舊 | ||||||||
| 外匯交易的未實現損失 | ( | ) | ||||||
| 經營資產與負債的變動： | ||||||||
| 應收賬款 | ||||||||
| 未開票收入 | ||||||||
| 庫存 | ||||||||
| 預付費用及其他流動資產 | ||||||||
| 應付賬款、其他應計費用和經營租賃的淨變動 | ( | ) | ( | ) | ||||
| 經營活動提供的淨現金（或用於） | ( | ) | ||||||
| 投資活動的現金流量 | ||||||||
| 專利購買 | ( | ) | ( | ) | ||||
| 租賃改良 | ( | ) | ||||||
| 辦公設備的採購 | ( | ) | ( | ) | ||||
| 業務組合中的現金支付 | ( | ) | ||||||
| 遞延實施成本 | ( | ) | ||||||
| 資本化軟件成本 | ( | ) | ( | ) | ||||
| 投資活動使用的淨現金 | ( | ) | ( | ) | ||||
| 融資活動的現金流 | ||||||||
| 信用額度的收益 | ||||||||
| 可轉換債務的收益 | ||||||||
| SPP計劃的收益 | ||||||||
| 或有對價支付 | ( | ) | ||||||
| 員工股票補償的稅款預扣支付以換取被放棄的股份 | ( | ) | ( | ) | ||||
| 庫藏股的增加（股票回購計劃） | ( | ) | ( | ) | ||||
| 償還債務和信用額度 | ( | ) | ( | ) | ||||
| 融資活動的淨現金（使用）提供 | ( | ) | ||||||
| 匯率變動對現金的影響 | ( | ) | ||||||
| 現金及現金等價物的減少 | ( | ) | ( | ) | ||||
| 包括受限現金在內的現金及現金等價物-期初 | ||||||||
| 包括受限現金在內的現金及現金等價物-期末 | $ | $ | ||||||
| 8 |
| 現金流信息的補充披露 | ||||||||
| 本期間支付的現金用於： | ||||||||
| 利息 | $ | $ | ||||||
| 所得稅 | $ | $ | ||||||
| 非現金投資和融資活動的補充披露 | ||||||||
| 利率掉期的公允價值變動 | $ | $ | ||||||
附帶說明是這些未經審計的合併基本報表的組成部分。
| 9 |
VerifyMe, Inc.
股東權益合併報表
（未經審計）
(以千爲單位，除股票數據外)
| A系列 可轉換 | b系列 可轉換 | |||||||||||||||||||||||||||||||||||||||||||||||
| 優先股 | 優先股 | 普通 | 財政部 | |||||||||||||||||||||||||||||||||||||||||||||
| 股票 | 股票 | 股票 | 其他 | 股票 | ||||||||||||||||||||||||||||||||||||||||||||
| 數量 | 數量 | 數量 | 已支付的資本 | 數量 | 累計其他 | 累計 | ||||||||||||||||||||||||||||||||||||||||||
| Shares | 金額 | Shares | 金額 | Shares | 金額 | 資本 | Shares | 金額 | 綜合損失 | Deficit | 總計 | |||||||||||||||||||||||||||||||||||||
| 截至2023年6月30日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 限制性股票獎勵，扣除員工稅款的股份 爲員工稅款扣留的股份 | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| 限制性股票單位，扣除員工稅款的股份 | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| 與股票購買計劃相關的普通股 | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 累積其他綜合損失 | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 淨虧損 | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 截至2023年9月30日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| A系列 可轉換 | b系列 可轉換 | |||||||||||||||||||||||||||||||||||||||||||||||
| 優先股 | 優先股 | 普通 | 財政部 | |||||||||||||||||||||||||||||||||||||||||||||
| 股票 | 股票 | 股票 | 其他 | 股票 | ||||||||||||||||||||||||||||||||||||||||||||
| 數量 | 數量 | 數量 | 已支付的資本 | 數量 | 累計其他 | 累計 | ||||||||||||||||||||||||||||||||||||||||||
| Shares | 金額 | Shares | 金額 | Shares | 金額 | 資本 | Shares | 金額 | 綜合損失 | Deficit | 總計 | |||||||||||||||||||||||||||||||||||||
| 截至2024年6月30日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 限制性股票獎勵 | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||
| 限制性股票單位，扣除員工稅款所扣的股份 | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||
| 因服務而發行的普通股 | - | - | ||||||||||||||||||||||||||||||||||||||||||||||
| 累積其他綜合收益 | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 淨虧損 | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 截至2024年9月30日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 10 |
| A輪 | B輪 | |||||||||||||||||||||||||||||||||||||||||||||||
| 可轉換 | 可轉換 | |||||||||||||||||||||||||||||||||||||||||||||||
| 優先股 | 優先股 | 普通 | 財政部 | |||||||||||||||||||||||||||||||||||||||||||||
| 股票 | 股票 | 股票 | 其他 | 股票 | 累計其他 | |||||||||||||||||||||||||||||||||||||||||||
| 數量 | 數量 | 數量 | 已支付的資本 | 數量 | 綜合 | 累計 | ||||||||||||||||||||||||||||||||||||||||||
| Shares | 金額 | Shares | 金額 | Shares | 金額 | 資本 | Shares | 金額 | 損失 | Deficit | 總計 | |||||||||||||||||||||||||||||||||||||
| 截至2022年12月31日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 受限股票獎勵，減去因員工稅而被扣留的股票 | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| 受限股票單位，減去因員工稅而被扣留的股票 | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| 與股票購買計劃相關的普通股 | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 與收購相關的普通股 | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| 普通股回購 | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 累計其他綜合損失 | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 淨虧損 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||||||
| 截至2023年9月30日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| A輪 | B輪 | |||||||||||||||||||||||||||||||||||||||||||||||
| 可轉換 | 可轉換 | |||||||||||||||||||||||||||||||||||||||||||||||
| 優先股 | 優先股 | 普通 | 財政部 | |||||||||||||||||||||||||||||||||||||||||||||
| 股票 | 股票 | 股票 | 其他 | 股票 | 累計其他 | |||||||||||||||||||||||||||||||||||||||||||
| 數量 | 數量 | 數量 | 已支付的資本 | 數量 | 綜合 | 累計 | ||||||||||||||||||||||||||||||||||||||||||
| Shares | 金額 | Shares | 金額 | Shares | 金額 | 資本 | Shares | 金額 | 損失 | Deficit | 總計 | |||||||||||||||||||||||||||||||||||||
| 截至2023年12月31日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 限制性股票獎勵 | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| 限制性股票單位，扣除了員工稅務所需的股份 | - | - | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| 與股票購買計劃相關的普通股 | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| 因服務而發行的普通股 | - | - | - | - | - | 170 | - | - | - | - | 170 | |||||||||||||||||||||||||||||||||||||
| 回購普通股 | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 累計其他綜合損失 | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| 淨虧損 | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||||||
| 截至2024年9月30日的餘額 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
附帶說明是這些未經審計的合併基本報表的組成部分。
| 11 |
VerifyMe, Inc.
合併基本報表附註 （未經審計）
注意 1 – 重要會計政策摘要
業務性質
VerifyMe, Inc.（「VerifyMe」）在州內註冊
於
VerifyMe是一家使用專門的軟件和過程科技提供可追溯性和客戶支持服務的公司。該公司運營着精準物流部門和認證部門，爲時間和溫度敏感的產品提供專業的物流服務，以及項目級追溯、防轉移和防僞保護、品牌保護和增強技術解決方案。通過我們的精準物流部門，我們提供基於專有軟件平台的敏感包裹管理增值服務，該平台通過關鍵指標的預測分析提供支持，如貨物發運前的天氣分析、航班追蹤、分類總量和交通情況，通過安全門戶交付給客戶。該門戶實時提供發貨運輸和最後一公里事件的可視化，得到了服務中心的支持。通過我們的認證部門，我們的技術使品牌所有者能夠通過供應鏈收集業務情報、交叉銷售產品、檢測僞造活動、監控產品轉移，並利用我們獨特的動態編碼建立品牌忠誠度，這些編碼可通過消費者的智能手機讀取。VerifyMe的大部分營業收入來自精準物流部門。公司的活動面臨重大風險和不確定性。請參閱本報告中的「風險因素」和「管理層對財務狀況和經營成果的討論與分析」章節。
重分類
截至2023年9月30日的三個月和九個月所呈現的某些金額反映了爲符合我們當前報告期的呈現而進行的重分類。這些重分類對之前報告的淨虧損沒有影響。
財務報表基礎
隨附的未經審計的中期合併 基本報表（「中期報表」）包括VerifyMe及其全資子公司PeriShip 全球貨幣和Trust Codes 全球的賬目。所有重要的公司間餘額和交易在合併時已被消除。合併 基本報表是根據10-Q表格報告的規則和規定準備的。因此，根據美國一般公認會計原則（「GAAP」）對完整基本報表的某些信息 和披露未在這裏包含。中期報表應與公司最新的年度報告中包含的基本報表及其註釋共同閱讀 在2023年12月31日結束的年度報告中，根據2024年3月29日向證券交易委員會（「SEC」）提交的文件。隨附的中期報表是未經審計的；然而，管理層的意見認爲， 所有被視爲公平陳述所需的調整（包括正常的經常性應計）已被包括在內。至2024年9月30日結束的三個月和九個月的臨時 結果不一定能代表預期的結果，2024年12月31日結束的年度或任何未來的中期。
受限制現金
下表提供了合併資產負債表中報告的現金、現金等價物和受限現金的對賬，這些金額的總和與合併現金流量表中相同金額的總和相等（以千美元計）：
| 截至 | ||||||||
| 2024年9月30日 | 2023年12月31日 | |||||||
| 現金及現金等價物 | $ | $ | ||||||
| 受限現金 | ||||||||
| 包括受限現金在內的現金及現金等價物總額 | $ | $ | ||||||
公司將限制在未來十二個月內無法用於經營的現金及現金等價物
歸類爲限制性現金。
| 12 |
板塊報告
經營分部被定義爲企業中可獲取和定期評估的元件，這些信息由首席經營決策者或決策小組在決定資源分配和績效評估方法時使用。公司有兩個可報告的分部，即（i）精準物流和（ii）身份驗證。有關公司的分部報告結構的進一步討論，請參見附註11 - 分部報告。
外幣兌換
我們新西蘭運營的功能貨幣是當地貨幣，即新西蘭元（NZD）。外幣轉換爲美元的過程是根據資產負債表日期的現行匯率進行的，而營收和費用帳戶則使用全年加權平均匯率。由於這樣的轉換而導致的未實現的收益和損失包括在綜合收益的一部分中。由於貨幣匯率波動而導致的翻譯收益和損失包括在我們合併財務報表中的「總務和行政費用」。截至2024年9月30日的三個月和九個月外幣交易收益爲$
估計的使用
編制符合美國通用會計原則的基本報表要求管理層做出影響報告的資產和負債的金額及 at financial statements 日期的或有資產和負債的披露及報告期內的收入和費用的估計和假設。實際結果可能與這些估計有所不同。
近期會計公告
在2023年11月，財務會計準則委員會（「FASB」）發佈了ASU 2023-07，分部報告（主題280）：可報告分部披露的改進該準則要求擁有單一可報告分部的公共實體提供本標準所需的所有披露，以及主題280中現有的所有分部披露，包括披露定期提供給首席運營決策者（「CODM」）的重要分部費用的新要求，幷包含在分部利潤或損失報告指標中，其他分部項目的金額和構成，CODM的職稱和職位，以及CODM如何使用分部利潤或損失的報告指標來評估績效和決定如何分配資源。該指引自2023年12月15日後開始的年度期間生效，自2024年12月15日後開始的中期期間生效，按追溯法應用，允許提前採用。公司自2024年1月1日起採用新標準。注11 – 分部報告已更新以反映新的披露要求，並且在合併運營報表中某些金額已被重新分類。該標準的採用對公司的合併財務報表和披露沒有其他影響。
金融工具的公允價值
公司的金融工具包括應收賬款、未開具的營業收入、應付賬款、應付票據和應計費用、或有對價以及長期衍生資產或負債。應收賬款、應付賬款和應計費用的賬面價值接近其公允價值，因爲它們的到期時間較短。公司認爲，根據目前公司可獲得的類似債務工具的利率和其他條款，其應付票據的賬面金額接近公允價值。
公司遵循FASB ASC 820，"公允價值計量和披露"，並將其應用於所有以公允價值基礎進行計量和報告的資產和負債。該聲明要求以公允價值計量的資產和負債將被分類並披露在以下三類之一：
第1級：在活躍市場中的相同資產或負債的報價市場價格
第2級：可觀察的市場基礎輸入或無法觀察的 輸入，這些輸入得到了市場數據的支持
級別3：未經市場數據證實的不可觀察輸入
公允價值的水平是基於對公允價值測量整體重要的最低水平輸入。
| 13 |
下表展示了公司在2024年9月30日和2023年12月31日的資產負債表中，按公允價值反覆計量和記錄的財務工具，以及它們在公允價值層級中的級別。
金額以千爲單位（'000）
| 衍生資產 | 或有對價 | |||||||
| (第二等級) | (第三等級) | |||||||
| 截至2023年12月31日的餘額 | $ | $ | ( | ) | ||||
| 或有對價公允價值的變動 | ||||||||
| 付款 | ||||||||
| 貨幣 | ||||||||
| 利率、互換的公允價值變更，記錄在其他綜合損失中 | ||||||||
| 截至2024年9月30日的餘額 | $ | $ | ( | ) | ||||
營業收入確認
根據會計標準編碼（「ASC」）第606章，公司按照營業收入進行會計處理 “客戶合同的營收該章確立了報告有關營收和現金流的信息的原則，包括營收的性質、金額、時間以及不確定性，這些營收和現金流來自於公司與客戶之間提供商品或服務的合同。
| 14 |
公司根據可報告的各個部門，採用以下五個步驟，以判斷在履行每項協議下的義務時，應該確認的適當營業收入金額。
| · | 識別與客戶的合同; |
| · | 識別合同中的履約義務； |
| · | 判斷交易價格; |
| · | 將交易價格分配到合同中的業績義務；並且 |
| · | 在履行義務被滿足時確認營業收入。 |
有關可報告 部門的更詳細信息，請參閱附註11 – 部門報告。公司通常將協議或工作聲明（「SOW」）和/或採購訂單的完成視爲客戶合同，前提是收款被認爲是可能的。
精準物流
我們的精準物流部門由兩條服務線組成：主動和優質。在我們的主動服務線下，客戶直接支付我們承運人服務費用以及我們的主動物流服務。條款通常爲7天，最長不超過30天。公司已確定其爲主要責任方，並在營業收入中確認運輸費用。在我們的優質服務線下，我們提供全面的白手套運輸監控和預測分析服務。此服務包括客戶網絡門戶訪問、天氣監控、溫控、全方位服務中心支持和最後一公里解決方案。付款條款通常爲30-45天。
在我們精準物流業務的兩個服務線下，當包裹送達時，我們的履約義務得到滿足，營業收入被確認。交易費用由合同上賬單向客戶收取的固定費用組成。交易費用中沒有任何變量考慮，兩個服務線均是如此。
認證
我們的認證板塊主要由我們的品牌保護服務線組成，該服務線包括一套定製的產品，提供客戶可追溯性和品牌解決方案。 條款通常在30到90天之間。我們的履行義務在產品發貨或交付時滿足，並根據與客戶的具體協議確認營業收入。交易費用由與相關訂單或協議的固定對價組成。公司的保修和其他變量考慮因素根據歷史保修、當前經濟趨勢以及客戶需求的變化進行分析，已確定在截至2024年9月30日的三個月和九個月內微不足道。
商譽
商譽代表了購買價格超過購買業務組合中淨資產公允價值的部分。根據ASC 350，公司每年在第四季度進行商譽減值測試，或者在某些情況下在年度測試之間進行。在權威指導下，公司首先評估定性因素以判斷是否有必要進行定量的商譽減值測試。評估考慮的因素包括但不限於宏觀經濟條件、顯示行業內其他公司的數據以及我們的股價。除非實體根據定性評估判斷其公允價值的可能性小於其賬面價值，否則不需要計算報告單位的公允價值。可能觸發減值審查的事件或變化包括宏觀經濟條件、行業和市場狀況、成本因素、整體財務表現、其他特定實體事件以及持續的股價下降。
| 15 |
本公司遵循FASB ASC 260，“每股盈利，”在報告每股收益時呈現基本每股收益和稀釋每股收益。因爲 本公司在每個報告期間均報告了淨虧損，包括優先股、期權 和Warrants的普通股等價物具有反稀釋效應；因此，基本和稀釋虧損每股金額相同。
截至2024年和2023年9月30日的三個月和九個月，存在可能發行的股份，這些股份可能在未來稀釋基本每股收益，因其納入計算稀釋每股收益將對公司在所列期間的損失產生反稀釋影響，因此被排除在計算之外。 反稀釋股份包括 未歸屬的業績限制股票單位、限制股票單位和限制股票獎勵， 行使股票期權可發行的股份， 行使Warrants可發行的股份， 可轉換債務轉換可發行的股份，以及 可轉換優先股轉換可發行的股份。截至2023年9月30日的三個月和九個月，存在大約 反稀釋股份包括 未歸屬的業績限制股票單位， 限制性股票單位，限制性股票獎勵及期權，股票購買計劃下的期權， 可通過行使股票期權獲得的股票， 可通過行使Warrants獲得的股票， 可通過轉換可轉債獲得的股票，和 可通過轉換優先股獲得的股票。
| 16 |
我們根據FASB ASC 718的規定，理解股票基礎的補償，補償—股票補償這要求根據授予日期的估計公允價值，對所有授予給員工和董事的股票基礎獎勵進行補償費用的計量和確認。我們在授予日使用Black-Scholes模型來估計股票期權的公允價值。Black-Scholes期權定價模型中使用的假設包括無風險利率、預期波動性和股票期權的預期壽命。這些假設的變化可能對股票基礎補償的公允價值估計和未來期間記錄的補償費用產生重大影響。最終預計將歸屬的獎勵部分的價值在所需服務期間內按直線法作爲費用確認。對於具有股票價格增值目標的績效限制性股票單位（見註釋6 - 股票期權、限制性股票和Warrants），我們採用了一種包含蒙特卡洛模擬的格子方法，涉及隨機迭代，這些迭代基於適當的概率分佈，採用不同的未來價格路徑，時間跨度爲限制性股票單位的合同生命週期（這些概率分佈基於通常應用的Black Scholes輸入）。公允價值是通過取每個蒙特卡洛模擬試驗的授予日期公允值的平均值來確定的。我們在績效期間按直線法確認補償費用，並且不根據期間內的實際成就進行持續調整或抵消。
我們按照ASU第2018-07號的規定，將股票獎勵補償計入非員工的薪酬中，這一規定改善了非員工股權支付會計的處理方式，使非員工獲得的股權支付的會計處理與根據現有Topic 718指導原則的員工支付相一致，但有一些例外。此更新取代了先前針對非員工的權益基礎支付的指導，依據子主題505-50，權益 – 針對非員工的權益基礎支付”.
所有期權或其他股權工具的發行 作爲公司收到的商品或服務的對價，均根據發行的股權工具的公允價值進行 accounting。非員工的基於股權的支付，記錄爲在服務期內的費用，就好像我們用現金支付服務一樣。在每個財務報告期結束時，未歸屬或服務尚未完成之前，基於股權的支付的公允價值將重新計量，並且在期間確認的非現金費用將相應調整。由於授予非員工的基於股權的支付的公允價值在未來可能發生變化，因此未來費用的金額將包括公允價值的重計量，直到基於股權的支付完全歸屬或服務完成。
注意 2 – 營收
按類別劃分的營業收入
下列系列表格展示了我們按不同類別劃分的營業收入 （單位：千美元）。
| 認證 | 精準物流 | 合併項 | ||||||||||||||||||||||
| 營業收入 | 三個月結束 9月30日, | 三個月結束 9月30日, | 三個月結束 9月30日, | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| 主動服務 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| 高級服務 | ||||||||||||||||||||||||
| 品牌保護服務 | ||||||||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| 認證 | 精準物流 | 合併項 | ||||||||||||||||||||||
| 營業收入 | 截至九個月 9月30日, | 截至九個月 9月30日, | 截至九個月 9月30日, | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| 主動服務 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| 優質服務 | ||||||||||||||||||||||||
| 品牌保護服務 | ||||||||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| 17 |
合約餘額
收入確認、開票和現金收款的時機導致在合併資產負債表上形成未開票收入（合同資產）和遞延收入（合同負債）。根據合同條款，向客戶收取的金額在交付完成後通常會變爲可開票項目。未開票金額通常會在30天內開票並收款，通常不會超過60天。當我們在工作執行之前提前向客戶開票時，這些金額通常會在十二個月內確認收入並計入營收。這些資產和負債在每個報告期結束時按合同逐個報告在合併資產負債表上。在截至2024年9月30日的九個月期間，合同資產和負債餘額的變化沒有受到其他因素的實質性影響。
根據ASC主題606中的實用權宜措施，我們在發生時將獲得合同的增量成本（即銷售佣金）確認爲費用，如果我們本來會確認爲資產的攤銷期爲一年或更短。截至2024年9月30日，我們沒有任何資本化的銷售佣金。
在所呈現的所有期間內，合同負債並不顯著。
下表提供了有關與客戶合同相關的合同資產的信息：
| 合同資產 | ||||||||
| 9月30日 | ||||||||
| 以千計 | 2024 | 2023 | ||||||
| 期初餘額，1月1日 | $ | $ | ||||||
| 合同資產新增 | ||||||||
| 重分類至應收賬款，已開具給客戶 | ( | ) | ( | ) | ||||
| 期末餘額(1) | $ | $ | ||||||
______________
| (1) |
| 18 |
註釋 3 – 業務組合
Trust Codes 全球貨幣有限公司
2023 年 3 月 1 日，我們通過 Trust Codes 收購了
在全球範圍內，信託守則有限公司（「信託守則」）的業務和某些資產，專門從事品牌保護，防僞，
以及具有食品和農業行業專業知識的消費者參與技術。Trust Codes Global 使用獨特的二維碼或
物聯網與GS1標準相結合，基於獨特的每件商品數字身份提供基於雲的品牌保護，以保護品牌和
產品真實性，通過端到端供應鏈提高產品的數據可視化，並創建數據驅動引擎以
告知和教育消費者了解該產品。該公司將這筆交易視爲對ASC 805下業務的收購—
業務組合。購買價格約爲 $
The following table summarizes the purchase price allocation for the acquisition (dollars in thousands).
| Cash | $ | |||||||
| Fair value of contingent consideration | ||||||||
| Stock (issuance of 353,492 shares of common stock) (a) | ||||||||
| Total purchase price | $ | |||||||
| Amortization | ||||||||
| Period | ||||||||
| Purchase price allocation: | ||||||||
| Prepaid expenses | $ | |||||||
| Property and Equipment, net | ||||||||
| ROU Asset | ||||||||
| Developed Technology | ||||||||
| Trade Names/Trademarks | ||||||||
| Customer Relationships | ||||||||
| Goodwill | ||||||||
| Accounts payable and other accrued expenses | ( | ) | ||||||
| Current lease liability | ( | ) | ||||||
| Long term lease liability | ( | ) | ||||||
| $ |
| (a) |
Contingent Consideration
ASC Topic 805 requires that contingent consideration to be recognized at fair value on the acquisition date and be re-measured each reporting period with subsequent adjustments recognized in the consolidated statement of operations. We estimate the fair value of contingent consideration liabilities using an appropriate valuation methodology, typically either an income-based approach or a simulation model, such as the Monte Carlo model, depending on the structure of the contingent consideration arrangement. Contingent consideration is valued using significant inputs that are not observable in the market which are defined as Level 3 inputs pursuant to fair value measurement accounting. We believe our estimates and assumptions are reasonable; however, there is significant judgment involved. At each reporting date, the contingent consideration obligation is revalued to estimated fair value, and changes in fair value subsequent to the acquisitions are reflected in income or expense in the consolidated statements of operations, and could cause a material impact to, and volatility in, our results. Changes in the fair value of contingent consideration obligations may result from changes in discount periods and rates and changes in the timing and amount of revenue and/or earnings projections.
| 19 |
As of September 30, 2024, contingent consideration
presented as current liability totaled $
NOTE 4 – INTANGIBLE ASSETS AND GOODWILL
Goodwill
Goodwill represents costs in excess of values assigned to the underlying net assets of acquired businesses. Intangible assets acquired are recorded at estimated fair value. Goodwill is deemed to have an indefinite life and is not amortized but is tested for impairment annually, and at any time when events suggest an impairment more likely than not has occurred. We test goodwill at the reporting unit level.
ASC Topic 350, “Intangibles - Goodwill and Other” (“ASC Topic 350”), permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative goodwill impairment test. Under ASC Topic 350, an entity is not required to perform a quantitative goodwill impairment test for a reporting unit if it is more likely than not that its fair value is greater than its carrying amount. A reporting unit is an operating segment, or one level below an operating segment, as defined by U.S. GAAP.
Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. These estimates and assumptions include revenue growth rates and operating margins used to calculate projected future cash flows, risk-adjusted discount rates, future economic and market conditions and determination of appropriate market comparables. We base our fair value estimates on assumptions we believe to be reasonable but are unpredictable and inherently uncertain. Actual future results may differ from those estimates. The timing and frequency of our goodwill impairment tests are based on an ongoing assessment of events and circumstances that would indicate a possible impairment. On September 24, 2024, Paul Ryan, Executive Vice President, Authentication Segment, notified us of his resignation effective December 24, 2024. On October 4, 2024, we placed Mr. Ryan on garden leave, meaning he remains employed by us but is only working for us upon request. During the quarter, we have identified concerns relating to the commercial viability of this segment and we are evaluating a number of strategic alternatives for our Authentication segment. As a result, the Company made revisions to our internal forecasts and concluded that in accordance with ASC 350 a triggering event occurred indicating that potential impairment exists, which required the Company to conduct an interim test of the fair value of the goodwill for the Authentication segment. We performed a quantitative goodwill impairment test and determined the fair value of our reporting units using a combination of an equity approach and a market approach, employing a guideline public company approach. The results of our goodwill impairment test indicated that the carrying value of the Authentication reporting unit exceeded its estimated fair value. As a result, the Company recorded a goodwill impairment charge of $1,351 thousand during the three and nine months ended September 30, 2024, within goodwill and intangible asset impairment on the consolidated statement of operations. We will continue to monitor our goodwill and intangible assets for impairment and conduct formal tests when impairment indicators are present.
Each of our two reportable segments represents an operating segment under ASC Topic 280, Segment Reporting. We test our goodwill at the reporting unit level, or one level below an operating segment, under ASC Topic 350, “Intangibles - Goodwill and Other”. We determined that we have two reporting units for purposes of goodwill impairment testing, which represent our two reportable business segments, as discussed below.
Changes in the carrying amount of goodwill by reportable business segment for the nine months ended September 30, 2024, were as follows (in thousands):
| Authentication | Precision Logistics | Total | ||||||||||
| Net book value at | ||||||||||||
| January 1, 2024 | $ | $ | $ | |||||||||
| 2024 Activity | ||||||||||||
| Goodwill impairment charge | ( | ) | ( | ) | ||||||||
| Foreign currency translation | ( | ) | ( | ) | ||||||||
| Net book value at | ||||||||||||
| September 30, 2024 | $ | $ | $ | |||||||||
| 20 |
Intangible Assets Subject to Amortization
Our intangible assets include amounts recognized in connection with patents and trademarks, capitalized software and acquisitions, including customer relationships, tradenames, developed technology and non-compete agreements. Intangible assets are initially valued at fair market value using generally accepted valuation methods appropriate for the type of intangible asset. Amortization is recognized on a straight-line basis over the estimated useful life of the intangible assets. Intangible assets with definite lives are reviewed for impairment if indicators of impairment arise. Except for goodwill, we do not have any intangible assets with indefinite useful lives.
The revisions to our internal forecasts resulted
in an interim triggering event for the three months ending September 30, 2024, indicating the carrying value of our long-lived assets
including patents and trademarks, customer relationships, and developed technology may not be recoverable. Accordingly, the Company performed
an interim impairment test and assessed the recoverability of the related intangible assets by using level 3 inputs and comparing the
carrying value to the net undiscounted cashflow expected to be generated. The analysis indicated that certain intangible assets were impaired.
The Company further concluded as of September 30, 2024 the carrying value exceeded its estimated fair value, which resulted in an impairment
charge. The Company recorded an intangible impairment charge of $
Intangible assets with finite lives are subject to amortization over their estimated useful lives. The primary assets included in this category and their respective balances were as follows (in thousands):
| September 30, 2024 | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Weighted Average Remaining Useful Life (Years) | ||||||||||||
| Patents and Trademarks | $ | $ | ( | ) | $ | |||||||||||
| Customer Relationships | ( | ) | ||||||||||||||
| Developed Technology | ( | ) | ||||||||||||||
| Internally Used Software | ( | ) | ||||||||||||||
| Non-Compete Agreement | ( | ) | ||||||||||||||
| Deferred Implementation | ( | ) | ||||||||||||||
| Total Intangible Assets | $ | $ | ( | ) | $ | |||||||||||
| December 31, 2023 | ||||||||||||||||
| Patents and Trademarks | $ | $ | ( | ) | $ | |||||||||||
| Capitalized Software | ( | ) | ||||||||||||||
| Customer Relationships | ( | ) | ||||||||||||||
| Developed Technology | ( | ) | ||||||||||||||
| Internally Used Software | ( | ) | ||||||||||||||
| Non-Compete Agreement | ( | ) | ||||||||||||||
| Deferred Implementation | ( | ) | ||||||||||||||
| Total Intangible Assets | $ | $ | ( | ) | $ | |||||||||||
Amortization expense for intangible assets
was $
Patents and Trademarks
As of September 30, 2024, our current patent and trademark portfolios consist of nine granted U.S. patents and two granted European patents (one validated in four countries of France, Germany, United Kingdom, and Italy and one validated in three countries of France, Germany and United Kingdom), two pending U.S. and foreign patent applications, twenty-three registered U.S. trademarks, two EU trademark registrations, one Colombian trademark registration, one Australian trademark registration, one Japanese trademark registration, one Mexican trademark registration, one Singaporean trademark registration, two UK trademark registrations, seven NZ trademark registration, one OAPI (African Intellectual Property Organization) trademark registration, and one pending US and one foreign trademark application in Nigeria. The Company abandoned one patent during the nine months ended September 30, 2024.
| 21 |
The Company expects to record amortization expense of intangible assets over the next 5 years and thereafter as follows (in thousands):
| Fiscal Year ending December 31, | ||
| 2024 (three months remaining) | $ | |
| 2025 | ||
| 2026 | ||
| 2027 | ||
| 2028 | ||
| Thereafter | ||
| Total | $ | |
NOTE 5 – STOCKHOLDERS’ EQUITY
The Company expensed $
The Company expensed $
During the nine months ended September 30, 2024, the Company issued shares of common stock upon vesting of restricted stock units, and shares of common stock from treasury shares, net of common stock withheld for taxes.
On March 31, 2024, the Company issued of
restricted common stock, vesting immediately, with a value of $
Non-Qualified Stock Purchase Plan
On June 10, 2021, the stockholders of the Company
approved a non-qualified stock purchase plan (the “2021 Plan”). The 2021 Plan provides eligible participants, including employees,
directors and consultants of the Company, the opportunity to purchase shares of the Company’s common stock thereby increasing their
interest in the Company’s continued success. The maximum number of common stock reserved and available for issuance under the 2021
Plan is 500,000 shares. The purchase price of shares of common stock acquired pursuant to the exercise of an option will be the lesser
of 85% of the fair market value of a share (a) on the enrollment date, and (b) on the exercise date. The 2021 Plan is not intended to
qualify as an employee stock purchase plan under Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”).
The Company applied FASB ASC 718, “Compensation-Stock Compensation” and estimated the fair value using the Black-Scholes
model, as the 2021 Plan is considered compensatory. In relation to the 2021 Plan the Company expensed $ and $ thousand for the three
and nine months ended September 30, 2024, respectively. During the nine months ended September 30, 2024, the Company received $
Shares Held in Treasury
As of September 30, 2024, and December 31, 2023,
the Company had and shares, respectively, held in treasury with a value of approximately $
On February 29, 2024, seven participants exercised
their option under the Company’s non-qualified stock purchase plan, and as a result,
Shares Repurchase Program
In December 2023, the Company’s Board of
Directors approved a new share repurchase program to allow the Company to spend up to $ million to repurchase shares of its common
stock so long as the price per share does not exceed $1.00 until December 14, 2024. During the nine months ended September 30, 2024, the
Company repurchased shares of common stock for $
| 22 |
During 2013, the Company adopted the 2013 Omnibus Equity Compensation Plan (the “2013 Plan”). Under the 2013 Plan, the Company is authorized to grant awards of stock options, restricted stock, restricted stock units and other stock-based awards up to an aggregate of shares of common stock. The 2013 Plan is intended to permit certain stock options granted to employees under the 2013 Plan to qualify as incentive stock options. All options granted under the 2013 Plan, which are not intended to qualify as incentive stock options are deemed to be non-qualified stock options.
On November 14, 2017, the Executive Committee of the Company’s Board of Directors adopted the 2017 Equity Incentive Plan (the “2017 Plan”) which covered the potential issuance of shares of common stock. The 2017 Plan provided that directors, officers, employees, and consultants of the Company were eligible to receive equity incentives under the 2017 Plan at the discretion of the Board or the Board’s Compensation Committee.
On August 10, 2020, the Company’s Board of Directors adopted the 2020 Equity Incentive Plan (the “2020 Plan”), subject to stockholder approval, which authorizes the potential issuance of up to shares of common stock. On September 30, 2020, the Company’s stockholders approved the 2020 Plan, and upon such approval the 2020 Plan became effective and the 2017 Plan was terminated. Shares of common stock underlying existing awards under the 2017 Plan may become available for issuance pursuant to the terms of the 2020 Plan under certain circumstances. Employees and non-employee directors of the Company or its affiliates, and other individuals who perform services for the Company or any of its affiliates, are eligible to receive awards under the 2020 Plan at the discretion of the Board of Directors or the Board’s Compensation Committee.
On March 28, 2022, the Company’s Board of Directors adopted the First Amendment to the 2020 Plan, subject to stockholder approval, which increased the shares authorized for potential issuance under the 2020 Plan to shares of common stock and extended the term of the 2020 Plan to June 9, 2032. On June 9, 2022, the Company’s stockholders approved the First Amendment to the 2020 Plan. On April 17, 2023, the Company’s Board of Directors adopted the Second Amendment to the 2020 Plan, subject to stockholder approval, which increased the shares authorized for potential issuance under the 2020 Plan to shares of common stock and extended the term of the 2020 Plan to June 6, 2033. On June 6, 2023, the Company’s stockholders approved the Second Amendment to the 2020 Plan. On March 18, 2024, the Company’s Board of Directors adopted the Third Amendment to the 2020 Plan, subject to stockholder approval, which increased the shares authorized for potential issuance under the 2020 Plan to shares of common stock and extended the term of the 2020 Plan to June 4, 2034. On June 4, 2024, the Company’s stockholders approved the Third Amendment to the 2020 Plan.
The 2020 Plan, as amended, is administered by the Compensation Committee which determines the persons to whom awards will be granted, the number of awards to be granted and the specific terms of each grant, including the vesting thereof, subject to the provisions of the plan.
The aggregate fair market value (determined at the time of the grant) of stock with respect to which incentive stock options are exercisable for the first time by any individual during any calendar year (under all plans of the Company and its affiliates) shall not exceed $100 thousand, and the options in excess of $100 thousand shall be deemed to be non-qualified stock options, including prices, duration, transferability and limitations on exercise. The maximum number of shares of common stock that may be issued under the 2020 Plan pursuant to incentive stock options may not exceed, in the aggregate, .
The Company has issued non-qualified stock options pursuant to contractual agreements with non-employees. Options granted under the agreements are expensed when the related service or product is provided. Determining the appropriate fair value of stock-based awards requires the input of subjective assumptions. The Company uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value represent management’s best estimates and involve inherent uncertainties and judgements.
| 23 |
Stock Options
The following table summarizes the activities for the Company’s stock options as of September 30, 2024:
| Options Outstanding | ||||||||||||||||
| Weighted - | ||||||||||||||||
| Average | ||||||||||||||||
| Remaining | Aggregate | |||||||||||||||
| Weighted- | Contractual | Intrinsic | ||||||||||||||
| Number of | Average | Term | Value | |||||||||||||
| Shares | Exercise Price | (in years) | (in thousands)(1) | |||||||||||||
| Balance as of December 31, 2023 | $ | |||||||||||||||
| Granted | ||||||||||||||||
| Forfeited/Cancelled/Expired | ( | ) | $ | |||||||||||||
| Balance as of September 30, 2024 | $ | |||||||||||||||
| Exercisable as of September 30, 2024 | $ | $ | ||||||||||||||
| (1) |
| 24 |
As of September 30, 2024, the Company had no unvested stock options.
During the nine months ended September 30, 2024,
and 2023, the Company expensed $
As of September 30, 2024, there was $
Restricted Stock Awards and Restricted Stock Units
The following table summarizes the unvested restricted stock awards as of September 30, 2024:
| Weighted - | ||||||||
| Average | ||||||||
| Number of | Grant | |||||||
| Award Shares | Date Fair Value | |||||||
| Unvested at December 31, 2023 | ||||||||
| Granted | ||||||||
| Vested | ( | ) | ||||||
| Balance at September 30, 2024 | $ | |||||||
As of September 30, 2024, total unrecognized share-based
compensation cost related to unvested restricted stock awards is $
The following table summarizes the unvested time-based restricted stock units as of September 30, 2024:
| Weighted - | ||||||||
| Average | ||||||||
| Number of | Grant | |||||||
| Unit Shares | Date Fair Value | |||||||
| Unvested at December 31, 2023 | ||||||||
| Granted | ||||||||
| Vested | ( | ) | ||||||
| Forfeited | ( | ) | ||||||
| Balance at September 30, 2024 | $ | |||||||
As of September 30, 2024, total unrecognized share-based
compensation cost related to unvested time-based restricted stock units was $
| 25 |
The following table summarizes the unvested performance based restricted stock units as of September 30, 2024:
| Weighted - | ||||||||
| Average | ||||||||
| Number of | Number of | |||||||
| Unit Shares | Unit Shares | |||||||
| Unvested at December 31, 2023 | ||||||||
| Granted | ||||||||
| Forfeited/Cancelled | ( | ) | ||||||
| Balance at September 30, 2024 | $ | |||||||
For restricted stock units with stock price appreciation targets, we applied a lattice approach that incorporated a Monte Carlo simulation, which involved random iterations that took different future price paths over the restricted stock unit’s contractual life based on the appropriate probability distributions (which are based on commonly applied Black Scholes inputs). The fair value of each grant was determined by taking the average of the grant date fair values under each Monte Carlo simulation trial. We recognize compensation expense on a straight-line basis over the derived service period and there is no ongoing adjustment or reversal based on actual achievement during the period.
As of September 30, 2024, total unrecognized share-based
compensation cost related to unvested performance based restricted stock units was $
Warrants
The following table summarizes the activities for the Company’s warrants as of September 30, 2024:
| Number of Warrant Shares | Weighted- Average Exercise Price | Weighted - Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in thousands)(1) | |||||||||||||
| Balance as of December 31, 2023 | $ | |||||||||||||||
| Granted | ||||||||||||||||
| Expired | ||||||||||||||||
| Balance as of September 30, 2024 | $ | |||||||||||||||
| Exercisable as of September 30, 2024 | $ | $ | ||||||||||||||
| (1) |
NOTE 7—DEBT
PeriShip Global is a party to a debt facility with PNC Bank, National Association (the “PNC Facility”). The PNC Facility includes a $1 million revolving line of credit (the “RLOC”) with a term of one-year which was scheduled to expire in September 2024. On August 14, 2024, the Company signed a waiver and amendment which provided a waiver for a certain event of default and extended the line of credit to September 30, 2025. The RLOC has no scheduled payments of principal until maturity, and bears interest per annum at a rate equal to the sum of Daily SOFR plus 2.85% with monthly interest payments. The PNC Facility also includes a four-year term note (the “Term Note”) for $2 million which matures in September of 2026 and requires equal quarterly payments of principal and interest. The Term Note incurs interest per annum at a rate equal to the sum of Daily SOFR plus 3.1%. The RLOC and Term Note are guaranteed by VerifyMe and secured by the assets of PeriShip Global and VerifyMe.
| 26 |
The PNC Facility includes a number of affirmative and restrictive covenants applicable to PeriShip Global, including, among others, a financial covenant to maintain a fixed charge coverage ratio of at least 1.10 to 1.00 at the end of each fiscal year, affirmative covenants regarding delivery of financial statements, payment of taxes, and establishing primary depository accounts with PNC Bank, and restrictive covenants regarding dispositions of property, acquisitions, incurrence of additional indebtedness or liens, investments and transactions with affiliates. PeriShip Global is also restricted from paying dividends or making other distributions or payments on its capital stock if an event of default (as defined in the PNC Facility) has occurred or would occur upon such declaration of dividend. PeriShip Global was in compliance with all affirmative and restrictive covenants under the PNC Facility at September 30, 2024.
As of September 30, 2024, our short-term debt
outstanding under the Term Note was $
As of September 30, 2024, $
Effective
October 17, 2022, the Company entered into an interest rate swap agreement, with a notional amount of $
Convertible Debt
On
August 25, 2023, the Company entered into a Convertible Note Purchase Agreement with certain investors for the sale of convertible promissory
notes for the aggregate principal amount of $
NOTE 8—INCOME TAXES
There are
Some of the federal tax carry forwards will expire
at various dates through 2037. Generally, these can be carried forward and applied against future taxable income at the tax rate applicable
at that time. We are currently using an effective income tax rate of
Utilization of the net operating losses (NOL) carryforwards may be subject to a substantial annual limitation as required by Section 382 of the IRC, due to ownership changes of the company that could occur in the future, as well as similar state provisions. In general, an “ownership change” as defined by Section 382 results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders. These ownership changes may limit the amount of NOL carryforwards that can be utilized annually to offset future taxable income.
In accordance with FASB ASC 740 “Income Taxes”, valuation allowances are provided against deferred tax assets, if based on the weight of available evidence, some or all, of the deferred tax assets may or will not be realized. The Company did not utilize any NOL deductions for the nine months ended September 30, 2024.
NOTE 9– LEASES
The Company accounts for its leases under Accounting Standard Codification (“ASC”) Topic 842, “Leases”. The Company determines at its inception whether an arrangement that provides us control over the use of an asset is a lease. We recognize at lease commencement a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term. We have elected not to recognize a ROU asset and lease liability for leases with terms of 12 months or less. Our current long-term leases include an option to extend the term of the lease prior to the end of the initial term. It is not reasonably certain that we will exercise the option and have not included the impact of the option in the lease term for purposes of determining total future lease payments. As our lease agreement does not explicitly state the discount rate implicit in the lease, we use our promissory note borrowing rate to calculate the present value of future payments.
| 27 |
In addition to the base rent, real estate leases typically contain provisions for common-area maintenance and other similar services, which are considered non-lease components for accounting purposes. For our real estate leases, we apply a practical expedient to include these non-lease components in calculating the ROU asset and lease liability. For all other types of leases, non-lease components are excluded from our ROU assets and lease liabilities and expensed as incurred.
We have operating leases for office facilities. We do not have any finance leases.
Lease expenses are included in General & administrative expenses on the accompanying Consolidated Statements of Operations. The components of lease expense were as follows (in thousands):
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Operating lease cost | $ | $ | $ | $ | ||||||||||||
| Short-term lease cost | ||||||||||||||||
| Total lease costs | $ | $ | $ | $ | ||||||||||||
Supplemental information related to leases was as follows (dollars in thousands):
| September 30, 2024 | December 31, 2023 | |||||||
| Operating Lease right-of-use asset | $ | $ | ||||||
| Current portion of operating lease liabilities | $ | $ | ||||||
| Non-current portion of operating lease liabilities | ||||||||
| Total operating lease liabilities | $ | $ | ||||||
| Cash paid for amounts included in the measurement of operating lease liabilities | $ | $ | ||||||
| Right-of-use assets obtained in exchange for operating lease liabilities | $ | $ | ||||||
| Weighted-average remaining lease term for operating leases (years) | ||||||||
| Weighted average discount rate for operating leases | % | |||||||
The following is a reconciliation of future undiscounted cash flows to the operating lease liabilities on our consolidated balance sheets as of September 30, 2024 (in thousands):
| Year ending December 31, | ||||
| 2024 (three months remaining) | $ | |||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| Total future lease payments | ||||
| Less: imputed interest | ( | ) | ||
| Present value of future lease payments | ||||
| Less: current portion of lease liabilities | ( | ) | ||
| Long-term lease liabilities | $ | |||
NOTE 10– CONCENTRATIONS
For the three months ended September 30, 2024,
one customer represented
As of September 30, 2024, two customers made up
| 28 |
During the three and nine months ended September 30, 2024, one vendor
accounted for
NOTE 11 – SEGMENT REPORTING
As of September 30, 2024, we operated through two reportable business segments: (i) Precision Logistics and (ii) Authentication.
Precision Logistics:
This segment offers a value-added service provider for time and temperature sensitive parcel management. Through logistics management from a sophisticated IT platform with proprietary databases, package and flight-tracking software, weather, traffic, as well as dynamic dashboards with real-time visibility into shipment transit and last-mile events that are managed by a service center we provide our clients an end-to-end vertical approach for their most critical service delivery needs. Using our proprietary IT platform, we provide real-time information and analysis to mitigate supply chain flow interruption, delivering last-mile resolution for key markets, including the perishable healthcare and food industries.
Authentication:
This segment specializes in solutions that connect brands with consumers through their products. Consumers can authenticate products with their smart phone prior to usage, and brand owners have the ability to gather business intelligence while engaging directly with their consumers. Our Authentication segment also provides brand protection and supply chain functions such as counterfeit prevention.
We do not allocate the following items to the segments: general & administrative expenses, research and development and other income (expense).
The following table sets forth the revenue and operating results attributable to each reportable segment and includes a reconciliation of segment revenue to consolidated revenue and operating results to consolidated loss before income tax expense (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Revenue: | ||||||||||||||||
| Precision Logistics | $ | $ | $ | $ | ||||||||||||
| Authentication | ||||||||||||||||
| Total Revenue | $ | $ | $ | $ | ||||||||||||
| Gross Profit: | ||||||||||||||||
| Precision Logistics | $ | $ | $ | $ | ||||||||||||
| Authentication | ||||||||||||||||
| Total Gross Profit | ||||||||||||||||
| Segment Management and Technology - Precision Logistics | ||||||||||||||||
| Segment Management and Technology - Authentication | ||||||||||||||||
| Sales and marketing - Precision Logistics | ||||||||||||||||
| Sales and marketing - Authentication | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Research and development | ||||||||||||||||
| Goodwill and Intangible asset impairment | ||||||||||||||||
| LOSS BEFORE OTHER INCOME (EXPENSE) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| OTHER INCOME (EXPENSE) | ( | ) | ||||||||||||||
| NET LOSS | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
NOTE 12 – SUBSEQUENT EVENTS
On November 4, 2024, the Company issued shares of common stock upon vesting of restricted stock units, net of withheld for taxes related to a stock grant on November 2, 2022.
On November 8, 2024, the Board of Directors approved closing the Trust Codes Global business by the end of November 2024, unless the Company can find a purchaser for the Trust Codes Global business prior to the end of November 2024.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The information in this Management’s Discussion and Analysis should be read in conjunction with the accompanying unaudited consolidated financial statements and notes.
Cautionary Note Regarding Forward-Looking Statements
This report includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995. The words “believe,” “may,” “estimate,” “continue,” “intended,” “plan,” “could,” “target,” “potential,” “will,” “expect” and similar expressions are intended to identify forward-looking statements. All statements other than statements of historical facts contained in this report, including among others, our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth are forward-looking statements.
Our actual results and financial condition may differ materially from those expressed or implied in such forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.
For a further list and description of various risks, relevant factors and uncertainties that could cause future results or events to differ materially from those expressed or implied in our forward-looking statements, see the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in this report, our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and our other filings with the Securities and Exchange Commission (the “SEC”). All forward-looking statements in this report are made only as of the date hereof or as indicated and represent our views as of the date of this report. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise, except as required by law.
Overview
VerifyMe, Inc. (“VerifyMe”) together with its subsidiaries, including Trust Codes Global Limited (“Trust Codes Global”) and PeriShip Global, LLC (“PeriShip Global”), (together the “Company,” “we,” “us,” or “our”), is a traceability and customer support services provider using specialized software and process technology. The company operates a Precision Logistics Segment and an Authentication Segment to provide specialized logistics for time-and-temperature sensitive products, as well as item level traceability, anti-diversion and anti-counterfeit protection, brand protection and enhancement technology solutions. Through our Precision Logistics segment, we provide a value-added service for sensitive parcel management driven by a proprietary software platform that provides predictive analytics from key metrics such as pre-shipment weather analysis, flight-tracking, sort volumes, and traffic, delivered to customers via a secure portal. The portal provides real-time visibility into shipment transit and last-mile events which is supported by a service center. Through our Authentication segment our technologies enable brand owners to gather business intelligence through the supply chain, cross-sell products, detect counterfeit activities, monitor product diversion, and build brand loyalty utilizing our unique dynamic codes which are read by consumers with their smart phones. Further information regarding our business segments is discussed below:
Precision Logistics: The Precision Logistics segment specializes in predictive analytics for optimizing delivery of time and temperature sensitive perishable products. We manage complex industry-specific shipping logistic processes that require critical time, temperature control and handling to prevent spoilage and extreme delivery times and brand impairment. Utilizing predictive analytics from multiple data sources including flight-tracking, weather, traffic, major carrier feeds, and time of day data, we provide our clients an end-to-end vertical approach for their most critical service delivery needs. Using our proprietary IT platform, we provide real-time information and analysis to mitigate supply chain flow interruption, as well as delivering last-mile resolution for key markets, including the perishable healthcare and food industries.
Through our proprietary PeriTrack ® customer dashboard, we provide an integrated tool that gives our customers an in-depth look at their shipping activities and allows them access to critical information in support of the specific needs of the supply chain stakeholders. We offer post-delivery services such as customized reporting for trend analysis, system performance reports, power outage maps, and other tailored reports.
Precision Logistics generates revenue from two business service models.
| · | ProActive Service – clients pay us directly for carrier service coupled with our proactive logistics assistance. |
| · | Premium Service – clients pay us directly or through our carrier partner for our complete white-glove shipping monitoring and predictive analytics service. This service includes customer web portal access, weather monitoring, temperature control, full-service center support and last mile resolution. |
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Products: The Precision Logistics segment includes the following bundled services as part of our service offerings to our customers:
| · | PeriTrack ®: Our proprietary PeriTrack® customer dashboard was developed utilizing our extensive logistics operational knowledge. This integrated web portal tool gives our customers an in-depth look at their shipping activities based on real-time data. The PeriTrack® dashboard was designed to provide critical information in support of the specific needs of supply chain stakeholders and gives our customer resolution specialists a 360° view of shipping activity. PeriTrack® features tools tailored for shippers of perishable goods, which includes the In-Transit Shipment Tracker. This tool provides details on the unique shipper’s in-transit shipments, with the ability to select and analyze data on individual shipments. |
| · | Service Center: We have assembled a team of customer resolution specialists based in the U.S. This service team resolves shipping problems on behalf of our customers. The service center acts as a help desk and monitors shipping to delivery for our customers. |
| · | Pre-Transit Service: We help clients prepare their products for shipments by advising clients on packaging requirements for various types of perishable products. Each product type requires its own particular packaging to protect it during shipment, and we utilize our extensive knowledge and research to provide our customers with packaging recommendations to meet their unique needs. |
| · | Post-Delivery: We provide customized reporting for trend analysis, system performance reports, power outage maps, and many other reports to help our customers improve their processes and customer service outcomes. |
| · | Weather/Traffic Service: We have full-time meteorologists on staff to monitor weather. A package may experience a variety of weather conditions between the origin and destination, and our team actively monitors these conditions to maximize the number of timely and safely transmitted shipments. Similarly, traffic and construction also create unpredictable delays which our team works diligently to mitigate. If delays or other issues occur, we inform clients and work with them to proactively resolve such shipment issues. |
Authentication: The Authentication segment specializes in traceability to connect brands with consumers through their product. This is critical in the current landscape of increased regulations, as well as increased counterfeit activity and product diversion. The ability to detect fraud or abnormal behavior while tracing an item’s journey from production through to the consumer’s hands provides consumers and brands the assurance they require. VerifyMe has custom software, patented technologies, and a cloud environment that combines machine learning and data science to meet the needs of consumers and brands. In addition, the personalized consumer experience with the brand creates a connection that increases brand perception and loyalty.
Products: We have a custom suite of products that offer clients traceability and brand solutions. These products are combined with “software as a service” or “SaaS” which is stored in the cloud and accessed through the internet.
| · | VerifyMe Authenticate™ using rare earth-based ink taggants for instant authentication of labels, packaging and products |
| · | VerifyMe Track & Trace™ for unit level traceability and supply chain control |
Opportunities
Precision Logistics: Traditionally, most shipping businesses utilize the carrier’s data platform for tracking which generally informs the shipping enterprise, and their customers, when a package is in transit, when a package has been delivered, and some level of detail of the path which a package traveled. We believe taking the data feeds from a carrier and adding real-time visibility with predictive analytics and the human intervention factor of our service center gives us a competitive advantage against other third-party platforms that solely rely on the carrier’s data feeds. We utilize a variety of input sources beyond the carrier’s data feed. Our proprietary “Predictive Analytics” technology is fed real-time meteorology data, traffic and road construction data, and power grid information to help predict issues before they happen. If an alert is created the shipper and our service center will work to address the issue and save the perishable product from spoiling, saving the shipper significant costs and reducing the need to replace products that are no longer viable. We have meteorologists on staff that track world-wide weather patterns to address predicted issues before they happen. We believe the company has two significant areas of opportunity. First, our services are specifically designed to address the needs of small and medium size agriculture, food and beverage companies. Second, the pharmaceutical and healthcare industries represent significant opportunities due to the enhanced tracking and customer service associated with distribution of these products. We are focusing our sales emphasis on those industries.
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Building logistics infrastructure is a capital-intensive process as the investment is locked in for a considerably long period. Due to the current economic environment, and our cost competitive offering, we believe companies may opt to outsource their precision logistics services to reduce their operational costs. The outsourcing of supply chain related and other logistics operations to service providers such as ours allows companies to improve the efficiency of their businesses by focusing their resources on core competencies. We believe outsourcing this function to our Precision Logistics segment provides the ideal solution for all parties involved.
Authentication: On September 24, 2024, Paul Ryan, Executive Vice President, Authentication Segment, notified us of his resignation effective December 24, 2024. On October 4, 2024, we placed Mr. Ryan on garden leave, meaning he remains employed by us but is only working for us upon request. On November 8, 2024, our Board of Directors approved closing the Trust Codes Global business by the end of November 2024 unless we can find a purchaser for the Trust Codes Global business prior to the end of November 2024. We made this decision in order to deploy the cash generated by our Precision Logistics segment to pursue potential acquisitions to fund growth and further invest in our Precision Logistics segment.
Partnerships:
Precision Logistics has a direct partnership with a major global carrier company and has data feeds directly from the carrier into our proprietary logistics optimization software which provides shippers much more detailed information and predictive analytics on their shipment versus a standard shipping code look up which is provided by the carrier. In addition to relying on this strategic partner for shipping services we have a service agreement pursuant to which this strategic partner resells our services to its customers under a “white label” arrangement. Under this arrangement we provide our logistics services to our strategic partner’s customers in exchange for a pre-negotiated service fee per shipment. Our strategic partner has begun to provide its own service offerings to its customers and while we will continue to offer our Premium services, we expect our partner will prefer to offer their solution to customers as the primary recommendation and our solution will be offered as a secondary solution. This does not affect our proactive services, and we expect to see growth under that service offering as we focus on providing proactive services to customers directly.
Our Authentication segment has a contract with HP Indigo, and a strategic partnership with INX, the third largest producer of inks in North America. We believe these partnerships can be used to enable brand owners to securely prevent counterfeiting, prevent product diversion and authenticate labels, packaging and products alleviating liability from counterfeit products that harm consumers.
Current Economic Environment
In response to market conditions and lower demand some carriers have implemented strategies to address a potential global recession. In April 2023, the major carrier that PeriShip Global partners with laid out steps it was taking to slash $4 billion in permanent costs by the end of its 2025 fiscal year in response to these market conditions and lower demand. In June 2023, the major carrier stated that due to ongoing demand, it plans to ground 29 more aircraft in its fiscal year that started in June 2024. In mid-December 2023, the carrier forecasted a low single digit percentage decline in revenue year over year for 2024.
We have seen a softening in demand for some services related to high-end perishable items which seem to be impacted by reduced discretionary spending by U.S. consumers. While a recession, whether global or more localized to the U.S., may decrease the demand for our services that are more discretionary in nature, we believe that the internal cost cutting measures, if implemented by the major global carrier may benefit out-sourced service providers. We are working with this major global carrier to address their small and medium-sized business clients, which we believe is an underserved market and presents growth opportunities for our Precision Logistics segment. However, we can provide no assurances that a decline in discretionary consumer spending will not have a negative impact on our revenues and results of operations.
Seasonality
We experience seasonal fluctuations in our net revenues from sales in our Precision Logistics segment. Revenues from sales are generally higher in the fourth quarter than in other quarters due to increased holiday shipments. The seasonality of our business may cause fluctuations in our quarterly operating results.
Results of Operations
Comparison of the three months ended September 30, 2024, and 2023
The following discussion analyzes our results of operations for the three months ended September 30, 2024, and 2023.
| Revenue | Three Months Ended September 30, | |||||||
| 2024 | 2023 | |||||||
| Precision Logistics | $ | 5,303 | $ | 5,457 | ||||
| Authentication | 132 | 147 | ||||||
| Total Revenue | $ | 5,435 | $ | 5,604 | ||||
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Consolidated revenue decreased by $169 thousand during the third quarter of 2024 compared to the third quarter of 2023. The growth in the Authentication segment has not materialized, and while the growth in the Precision Logistics segment Proactive services increased, this was more than offset by the previously disclosed discontinued contract with one customer in our Premium services . The Proactive services revenue grew 9% in Q3 2024 compared to Q3 2023. The Precision Logistics segment accounted for 98% of the revenue for the quarter.
| Gross Profit | Three Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | |||||||||||||||
| % of Revenue | % of Revenue | |||||||||||||||
| Precision Logistics | $ | 1,777 | 34 | % | $ | 1,909 | 35 | % | ||||||||
| Authentication | 118 | 89 | % | 137 | 94 | % | ||||||||||
| Total Gross Profit | $ | 1,895 | 35 | % | $ | 2,046 | 37 | % | ||||||||
Gross profit for the three months ended September 30, 2024, was $1,895 thousand, compared to $2,046 thousand for the three months ended September 30, 2023. The resulting gross margin was 35% for the three months ended September 30, 2024, compared to 37% for the three months ended September 30, 2023. The decrease in gross margin was principally due to the discontinued contract in Premium services in the Precision Logistics segment which has higher margins. The Proactive services revenue gross margin percentage improved in Q3 2024 compared to Q3, 2023.
Segment Management and Technology
Segment management and technology expenses decreased by $12 thousand to $1,329 thousand for the three months ended September 30, 2024, compared to $1,341 thousand for the three months ended September 30, 2023. The decrease relates primarily to a reduction in salaries with reduction in management. Amortization and depreciation expense was $306 thousand for the three months ended September 30, 2024, compared to $295 thousand for the three months ended September 30, 2023.
General and Administrative Expenses
General and administrative expenses decreased by $400 thousand to $778 thousand for the three months ended September 30, 2024, compared to $1,178 for the three months ended September 30, 2023. The decrease primarily relates to the $247 thousand severance expense in 2023 that did not recur in 2024. Stock compensation expense was $334 thousand for the three months ended September 30, 2024, compared to $452 thousand for the three months ended September 30, 2023, primarily due to reduction in Director compensation.
Research and Development
Research and development expenses were $5 thousand for the three months ended September 30, 2024, and 2023.
Sales and Marketing
Sales and marketing expenses increased by $24 thousand to $401 thousand for the three months ended September 30, 2024, compared to $377 thousand for the three months ended September 30, 2023. The increase is primarily related to increased salaries and marketing expenses in the Precision Logistics segment, partially offset by a reduction in salaries and travel in the Authentication segment.
Goodwill and Intangible Asset Impairment
As a result of a long-lived asset and goodwill asset impairment assessments performed in the third quarter of 2024, an intangible asset impairment charge of $901 thousand and a goodwill impairment charge of $1,351 thousand was recorded for the three months ended September 30, 2024, which represents the amount by which the net carrying value in the Authentication segment exceeded the fair value of the segment, primary due to changes to the forecasted cashflows of the segment.
Interest Expense, net
Interest expense, net was $29 thousand for the three months ended September 30, 2024, compared to $39 thousand for the three months ended September 30, 2023.
Net Loss
Consolidated net loss for the three months ended September 30, 2024, and 2023 was $2,424 thousand and $930 thousand, respectively. The decreased loss was primarily related to the goodwill and intangible asset impairment noted above partially offset by a gain in contingent consideration of $475 thousand. The resulting consolidated loss per share for the three months ended September 30, 2024, and three months ended September 30, 2023, was $0.23 and $0.09 per diluted share, respectively.
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Comparison of the nine months ended September 30, 2024, and 2023
The following discussion analyzes our results of operations for the nine months ended September 30, 2024, and 2023.
| Revenue | Nine Months Ended September 30, | |||||||
| 2024 | 2023 | |||||||
| Precision Logistics | $ | 16,161 | $ | 16,085 | ||||
| Authentication | 385 | 515 | ||||||
| Total Revenue | $ | 16,546 | $ | 16,600 | ||||
Consolidated revenue decreased $54 thousand for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. The decrease is primarily due to a decrease in our Authentication segment related to a project in 2023 that did not recur partially offset by an increase in Precision Logistics.
| Gross Profit | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | |||||||||||||||
| % of Revenue | % of Revenue | |||||||||||||||
| Precision Logistics | $ | 5,903 | 37 | % | $ | 4,748 | 30 | % | ||||||||
| Authentication | 342 | 89 | % | 405 | 79 | % | ||||||||||
| Total Gross Profit | $ | 6,245 | 38 | % | $ | 5,153 | 31 | % | ||||||||
Gross profit for the nine months ended September 30, 2024, was $6,245 thousand, compared to $5,153 thousand for the nine months ended September 30, 2023. The resulting gross margin was 38% for the nine months ended September 30, 2024, compared to 31% for the nine months ended September 30, 2023. The gross profit increase relates to the increased Premium services revenue which has higher margins as well as process improvements to increase Proactive services margins in the Precision Logistics segment.
Segment Management and Technology
Segment management and technology expenses increased by $492 thousand to $4,189 thousand for the nine months ended September 30, 2024, compared to $3,697 thousand for the nine months ended September 30, 2023. The increase relates primarily to the acquisition of Trust Codes Global in March 2023, lower capitalized labor costs and severance expense of $129 thousand. Amortization and depreciation expense of $905 thousand for the nine months ended September 30, 2024, compared to $835 thousand for the nine months ended September 2023.
General and Administrative Expenses
General and administrative expenses decreased by $613 thousand to $2,780 thousand for the nine months ended September 30, 2024, compared to $3,393 thousand for the nine months ended September 30, 2023. The decrease relates primarily to the deal costs related to the acquisition of the Trust Codes Global business of $278 thousand, as well as severance expense in 2023.
Research and Development
Research and development expenses were $65 thousand and $23 thousand for the nine months ended September 30, 2024, and 2023, respectively primarily due to additional projects in the Authentication segment.
Sales and Marketing
Sales and marketing expenses decreased by $404 thousand to $999 thousand for the nine months ended September 30, 2024, compared to $1,403 thousand for the nine months ended September 30, 2023. The decrease is primarily related to a reduction in employees and consultants in the Authentication segment, a reduction in stock compensation in Precision Logistics, partially offset by an increase in employees in Precision Logistics.
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Goodwill and Intangible Asset Impairment
As a result of a long-lived asset and goodwill asset impairment assessments performed in the third quarter of 2024, an intangible asset impairment charge of $914 thousand and a goodwill impairment charge of $1,351 thousand was recorded for the nine months ended September 30, 2024, which represents the amount by which the net carrying value in the Authentication segment exceeded the fair value of the segment, primary due to changes to the forecasted cashflows of the segment.
Interest Expense
Interest expense was $109 thousand for the nine months ended September 30, 2024, compared to interest expense of $127 thousand for the nine months ended September 30, 2023.
Net Loss
Consolidated net loss for the nine months ended September 30, 2024, and 2023 was $3,323 thousand and $3,392 thousand, respectively. The decreased loss was primarily related to an improvement in gross profit and a gain relating to the change in the fair value of the contingent consideration related to the acquisition of Trust Codes Global, offset by the goodwill and intangible asset impairment charge in 2024. The resulting consolidated loss per share for the nine months ended September 30, 2024, and nine months ended September 30, 2023, was $0.32 and $0.35 per diluted share, respectively.
Liquidity and Capital Resources
Cash provided by operating activities was $302 thousand during the nine months ended September 30, 2024, compared to cash used by operating activities of $599 thousand during the comparable period in 2023. The increase in cash is primarily due to the non-cash add backs to net loss.
Cash used in investing activities was $353 thousand during the nine months ended September 30, 2024, compared to $1,080 thousand during the nine months ended September 30, 2023. The decrease in spending in investing activities related to a decrease in capitalized software costs and a decrease in acquisition costs. The acquisition of the Trust Codes Global business was in March 2023.
Cash used in financing activities during the nine months ended September 30, 2024, was $438 thousand compared to cash provided by financing activities during the nine months ended September 30, 2023, of $1,277 thousand. The decrease relates mainly to the proceeds from the line of credit of $800 thousand and convertible debt of $1,100 thousand that occurred in the nine months ended September 30, 2023.
On August 25, 2023, the Company entered into a Convertible Note Purchase Agreement with certain investors for the sale of convertible promissory notes for the aggregate principal amount of $1,100 thousand of which $475 thousand was purchased by relating parties including certain members of management and the Board of Directors. As of September 30, 2024, $450 thousand is held by related parties after one member of management left the Company. The notes are subordinated unsecured obligations of the Company and accrue interest at a rate of 8% per year payable semiannually in arrears on February 25 and August 25 of each year, beginning on February 25, 2024. The notes will mature on August 25, 2026 unless earlier converted or repurchased at a conversion price of $1.15 per share of common stock. The Company may not redeem the notes prior to the maturity date. As of September 30, 2024, the amount outstanding on the convertible debt was $1,100 thousand and included in Convertible Note, and Convertible Note – related party on the accompanying Consolidated Balance Sheets. The Company has accrued interest expense of $9 thousand as of September 30, 2024.
On September 22, 2022, PeriShip Global became a party to the PNC Facility with PNC Bank, National Association. The PNC Facility includes a $1 million RLOC with a term of one-year, which was extended to December 14, 2023. We also entered into an amended and restated loan agreement with PNC effective October 31, 2023, which provided amendments to a number of affirmative and restrictive covenants applicable to PeriShip Global and extended the RLOC to September 30, 2024. We entered into a waiver and amendment on August 14, 2024 which provided a waiver for a certain event of default and extended the RLOC to September 30, 2025. The RLOC has no scheduled payments of principal until maturity, and bears interest per annum at a rate equal to the sum of Daily SOFR plus 2.85% with monthly interest payments. As of September 30, 2024, we had no borrowings under the RLOC.
The PNC Facility also includes a four-year Term Note for $2 million which matures in September of 2026 and requires equal quarterly payments of principal and interest. The Term Note incurs interest per annum at a rate equal to the sum of Daily SOFR plus 3.1%. The RLOC and Term Note are guaranteed by VerifyMe and secured by the assets of PeriShip Global and VerifyMe.
The PNC Facility includes a number of affirmative and restrictive covenants applicable to PeriShip Global, including, among others, a financial covenant to maintain a fixed charge coverage ratio of at least 1.10 to 1.00 at the end of each fiscal year, affirmative covenants regarding delivery of financial statements, payment of taxes, and establishing primary depository accounts with PNC Bank, and restrictive covenants regarding dispositions of property, acquisitions, incurrence of additional indebtedness or liens, investments and transactions with affiliates. PeriShip Global is also restricted from paying dividends or making other distributions or payments on its capital stock if an event of default (as defined in the PNC Facility) has occurred or would occur upon such declaration of dividend.
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Of the proceeds of $2.0 million from the Term Note, we used $1.8 million to settle debt outstanding issued in connection with the PeriShip Global acquisition, including the redemption of 61,000 shares of our common stock. As of September 30, 2024, our short-term debt outstanding under the Term Note was $0.5 million and total long-term debt outstanding under the Term Note was $0.5 million.
Effective October 17, 2022, we entered into an interest rate swap agreement, with a notional amount of $1,958 thousand, effectively fixing the interest rate on our outstanding debt at 7.602%.
In December 2023, the Company’s Board of Directors approved a new share repurchase program to allow the Company to spend up to $0.5 million to repurchase shares of its common stock so long as the price per share does not exceed $1.00 until December 14, 2024. During the nine months ended September 30, 2024, the Company repurchased 1,000 shares of common stock for $1 thousand under the Company’s current program.
We believe that our cash and cash equivalents will fund our operations for the next 12 months. We may issue additional debt or equity as we grow our business which we expect to grow organically, and if the opportunity arises, through key acquisitions that will help accelerate the growth of our business.
Off-Balance Sheet Arrangements
None.
Critical Accounting Policies and Estimates
Our financial statements are impacted by the accounting policies used and the estimates and assumptions made by management during their preparation. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows and which require the application of significant judgment by management. We believe estimates and assumptions related to these critical accounting policies are appropriate under the circumstances; however, should future events or occurrences result in unanticipated consequences, there could be a material impact on our future financial position, results of operations or cash flows.
Revenue Recognition
Our revenue transactions include logistics management for time and temperature sensitive packages, sales of our ink canisters, software, licensing, pre-printed labels, integrated solutions, and leasing of our equipment. We recognize revenue based on the principals established in ASC Topic 606, “Revenue from Contracts with Customers.” Revenue recognition is made when our performance obligation is satisfied. Our terms vary based on the solutions we offer and are examined on a case-by-case basis. For licensing our VerifyInkTM technology we depend on the integrity of our clients’ reporting.
Goodwill
We have recorded goodwill as part of our acquisitions, which represents the excess of purchase price over the fair value of net assets acquired in the business combinations. Pursuant to ASC 350, the Company will test goodwill for impairment on an annual basis in the fourth quarter, or between annual tests, in certain circumstances. Under authoritative guidance, the Company first assessed qualitative factors to determine whether it was necessary to perform the quantitative goodwill impairment test. The assessment considers factors such as, but not limited to, macroeconomic conditions, data showing other companies in the industry and our share price. An entity is not required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. Events or changes in circumstances which could trigger an impairment review include macroeconomic conditions, industry and market conditions, cost factors, overall financial performance, other entity specific events and sustained decrease in share price.
On September 24, 2024, Paul Ryan, Executive Vice President, Authentication Segment, notified us of his resignation effective December 24, 2024. On October 4, 2024, we placed Mr. Ryan on garden leave, meaning he remains employed by us but is only working for us upon request. During the quarter, we have identified concerns relating to the commercial viability of this segment and we are evaluating a number of strategic alternatives for our Authentication segment. As a result, the Company made revisions to our internal forecasts and concluded that in accordance with ASC 350 a triggering event occurred indicating that potential impairment exists, which required the Company to conduct an interim test of the fair value of the goodwill for the Authentication segment. We performed a quantitative goodwill impairment test and determined the fair value of our reporting units using a combination of an income approach, employing a discounted cashflow model, and a market approach, employing a guideline public company approach. The results of our goodwill impairment test indicated that the carrying value of the Authentication reporting unit exceeded its estimated fair value. As a result, the Company recorded a goodwill impairment charge of $1,351 thousand during the three and nine months ended September 30, 2024, within goodwill and intangible asset impairment on the consolidated statement of operations.
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Intangibles
We review long-lived assets for impairment when performance expectations, events, or changes in circumstances indicate that the asset’s carrying value may not be recoverable. The evaluation is performed at the lowest level of identifiable cashflows by comparing the carrying value of the asset to the undiscounted cashflow. If the evaluation indicates that the carrying amount of the assets may not be recoverable, any potential impairment is measured based upon the fair value of the related asset or asset group as determined by an appropriate market appraisal or other valuation technique.
As a result, of the revised internal forecasts, the Company concluded that this change was an interim triggering event for the three months ended September 30, 2024, indicating the carrying value of our long-lived assets including patents and trademarks, customer relationships, and developed technology may not be recoverable. Accordingly, the Company performed an interim impairment test and assessed the recoverability of the related intangible assets by using level 3 inputs and comparing the carrying value to the net undiscounted cashflow expected to be generated. The analysis indicated that certain intangible assets were impaired. The Company recorded an intangible impairment charge of $901 thousand during the three months ended September 30, 2024, within goodwill and intangible asset impairment on the consolidated statement of operations.
Stock-based Compensation
We account for stock-based compensation under the provisions of FASB ASC 718, “Compensation—Stock Compensation”, which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. We estimate the fair value of stock-based awards on the date of grant using the Black-Scholes model. The assumptions used in the Black-Scholes option pricing model include risk-free interest rates, expected volatility and expected life of the stock options. Changes in these assumptions can materially affect estimates of fair value stock-based compensation, and the compensation expense recorded in future periods. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line method.
For restricted stock units with stock price appreciation targets, we applied a lattice approach that incorporated a Monte Carlo simulation, which involved random iterations that took different future price paths over the restricted stock unit’s contractual life based on the appropriate probability distributions (which are based on commonly applied Black Scholes inputs). The fair value was determined by taking the average of the grant date fair values under each Monte Carlo simulation trial. We recognize compensation expense on a straight-line basis over the performance period and there is no ongoing adjustment or reversal based on actual achievement during the period.
We account for stock-based compensation awards to non-employees in accordance with ASU No. 2018-07, which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, “Equity – Equity-Based Payments to Non-Employees”.
All issuances of stock options or other equity instruments to non-employees as consideration for goods or services received by the Company are accounted for based on the fair value of the equity instruments issued. Non-employee equity-based payments are recorded as an expense over the service period, as if we had paid cash for the services. At the end of each financial reporting period, prior to vesting or prior to the completion of the services, the fair value of the equity-based payments will be re-measured, and the non-cash expense recognized during the period will be adjusted accordingly. Since the fair value of equity-based payments granted to non-employees is subject to change in the future, the amount of the future expense will include fair value re-measurements until the equity-based payments are fully vested or the service completed.
Recently Adopted Accounting Pronouncements
Recently adopted accounting pronouncements are discussed in Note 1 – Summary of Significant Accounting Policies in the notes accompanying the financial statements.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not Applicable.
ITEM 4. CONTROLS AND PROCEDURES.
(a) Evaluation of Disclosure Controls and Procedures
Our disclosure controls and procedures are designed to ensure information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. The Company’s Chief Executive Officer, our principal executive officer, and Chief Financial Officer, our principal financial officer, have evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of September 30, 2024, the end of the fiscal quarter covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, 2024, our disclosure controls and procedures were effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
(b) Changes in Internal Control over Financial Reporting
There have been no other changes in our internal controls over financial reporting (as defined in Rules 13a-15(d) and 15d-15(d) under the Exchange Act) during the three months ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 1A. RISK FACTORS.
For a discussion of the Company’s potential risks or uncertainties, please see “Part I—Item 1A—Risk Factors” and “Part II—Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC, and “Part I—Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations” herein. There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023, and subsequent Quarterly Reports on Form 10-Q, except as noted herein.
Our Precision Logistics segment relies on one key strategic partner for shipping services for our customers and as a source for customers representing a substantial percentage of our revenues.
Our business is dependent, and we believe that it will continue to depend on our relationship with one strategic partner. PeriShip Global partners with one major global carrier for all its customers’ shipping needs. While we work closely with this key strategic partner and have transportation services and pricing agreements in place covering the shipping services they provide to our customers, such agreements are subject to termination or modification from time to time. If our strategic partner is unwilling or unable to supply to us the shipping services we market and sell on acceptable terms, or at all, or otherwise elects to terminate its business relationship with us, we may not be able to obtain alternative shipping services from other providers on acceptable terms, in a timely manner, or at all, and our business may be materially and adversely impacted. We do not currently have any alternative shipping service suppliers from which we can obtain the shipping services we currently receive from our strategic partner. Establishing the necessary information technology infrastructure and business relationship with another shipping services provider would be costly and time consuming and may ultimately not be successful or cost-effective. Further, any increase in the prices charged by our single strategic partner or failure to perform by our strategic partner could cause our costs to increase or could cause us to experience short-term unavailability of shipping services on which our business relies.
In particular, delays and other shipping disruptions at our strategic partner significantly negatively impact our business. Our business involves the shipment of time and temperature sensitive goods, so our customers are significantly negatively impacted by delays and other shipping disruptions that cause product loss, spoilage and reputational harm. An increase in delays and other shipping disruptions on the part of our strategic partner could cause our clients to seek shipping solutions from our competitors who use alternative shipping service providers. If these events occur, it may reduce our profitability or may cause us to increase our prices. In addition, any material interruptions in shipping services by this strategic partner may result in significant cost increases and reduce sales, which could harm our business, financial condition and results of operations and may have a material adverse impact on our business.
In addition to relying on this strategic partner for shipping services, a material portion of our revenue has been generated through a service agreement pursuant to which this strategic partner resells our services to its customers under a “white label” arrangement. Under this arrangement we provide our logistics services to our strategic partner’s customers in exchange for a pre-negotiated service fee per shipment. Sales through our strategic partner accounted for approximately 17% of revenue of our Precision Logistics segment for the year ended December 31, 2023, and 20% for the nine months ended September 30, 2024. Our strategic partner has begun to provide its own service offerings to its customers, and we expect revenue from our Premium Services in our Precision Logistics segment will begin to decrease as we experience a reduction in business for these services. If we fail to offset a reduction in business for our Premium Services in our Precision Logistics segment through our ProActive Services or other service offerings, our business, financial condition and results of operations could be materially adversely affected.
The Company has significant goodwill and other intangible assets, and future impairment of these assets could have a material adverse impact on the Company's financial results.
The Company has recorded significant goodwill and other identifiable intangible assets on its balance sheet as a result of its acquisition of the PeriShip business in 2022 and Trust Codes business in 2023. A number of factors may result in impairments to goodwill and other intangible assets, including significant negative industry or economic trends, disruptions to our business, increased competition and significant changes in the use of the assets.
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On September 24, 2024, Paul Ryan, Executive Vice President, Authentication Segment, notified us of his resignation effective December 24, 2024. On October 4, 2024, we placed Mr. Ryan on garden leave, meaning he remains employed by us but is only working for us upon request. During the quarter, we have identified concerns relating to the commercial viability of this segment and on November 8, 2024 the Company made the decision to close Trust Codes Global by the end of November 2024 unless we can find a buyer for this business. As a result, the Company made revisions to our internal forecasts and concluded that in accordance with ASC 350 a triggering event occurred indicating that potential impairment exists, which required the Company to conduct an interim test of the fair value of the goodwill for the Authentication segment. The results of our goodwill impairment test indicated that the carrying value of the Authentication reporting unit exceeded its estimated fair value. As a result, the Company recorded a goodwill impairment charge of $1,351 thousand during the three and nine months ended September 30, 2024, within goodwill impairment charge on the consolidated statement of operations.
As a result of the revised internal forecasts, the Company concluded that this change was an interim triggering event for the three months ended September 30, 2024, indicating the carrying value of our long-lived assets including patents and trademarks, customer relationships, and developed technology may not be recoverable. Accordingly, the Company performed an interim impairment test and assessed the recoverability of the related intangible assets by using level 3 inputs and comparing the carrying value to the fair value. The analysis indicated that certain intangible assets were impaired. The Company recorded an intangible impairment charge of $901 thousand during the three months ended September 30, 2024, within impairment loss on intangibles on the consolidated statement of operations.
Impairment charges could adversely affect the Company's financial condition or results of operations in the periods recognized.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
On September 30, 2024, the Company issued 60,000 shares of common stock for services rendered to the Company pursuant to a Consulting Agreement between the Company and Pentant LLC, effective November 15, 2023, as amended June 30, 2024 (the “Consulting Agreement”). The securities issued pursuant to the Consulting Agreement were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.
Share Repurchase Plan
| ISSUER PURCHASES OF EQUITY SECURITIES | ||||||||
| Period | Total Number of Shares (or Units) Purchased |
Average Price Paid per Share (or Units) |
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1) |
Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(1 (In thousands) | ||||
| 07/01/2024-07/31/2024 | - | - | - | - | ||||
| 08/01/2024-08/31/2024 | - | - | - | - | ||||
| 09/01/2024-09/30/2024 | - | - | - | - | ||||
| Total | - | - | - | $499 | ||||
(1) Purchases made pursuant to the Company’s share repurchase program announced on December 8, 2023, pursuant to which the Company is authorized to purchase up to $0.5 million worth of shares of its common stock so long as the price per share does not exceed $1.00. Under the repurchase program, shares of the Company’s common stock may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual number of shares repurchased depend on a variety of factors, including legal requirements, price and economic and market conditions. The repurchase program may be suspended or discontinued at any time until it expires on December 14, 2024.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
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ITEM 5. OTHER INFORMATION.
During the three months ended September 30, 2024, no director or officer
of the Company
ITEM 6. EXHIBITS
*Filed herewith
**Furnished herewith
# Denotes management compensation plan or contract
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| VERIFYME, INC. | |
| Date: November 12, 2024 | By: /s/ Adam Stedham |
| Adam Stedham | |
|
Chief Executive Officer and President
(Principal Executive Officer) | |
| Date: November 12, 2024 | By: /s/ Nancy Meyers |
|
Nancy Meyers Executive Vice President and | |
|
Chief Financial Officer (Principal Financial Officer and Principal Accounting |
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