2022 Q3 Form 10-Q Financial Statement

#000121390022047356 Filed on August 12, 2022

View on sec.gov

Income Statement

Concept 2022 Q3 2022 Q2 2022 Q1
Revenue $5.413M $6.086M $6.951M
YoY Change 5.4% 24.03% 73.16%
Cost Of Revenue $2.052M $1.836M $2.204M
YoY Change 4.08% -4.1% 51.54%
Gross Profit $3.361M $4.250M $4.747M
YoY Change 6.22% 42.02% 85.45%
Gross Profit Margin 62.09% 69.83% 68.3%
Selling, General & Admin $3.706M $5.604M $5.807M
YoY Change -9.16% -9.64% 61.79%
% of Gross Profit 110.27% 131.87% 122.32%
Research & Development $1.374M $1.761M $2.105M
YoY Change -12.28% 15.33% 47.84%
% of Gross Profit 40.89% 41.45% 44.35%
Depreciation & Amortization $2.119M $1.983M $1.993M
YoY Change 71.08% 50.56% 89.33%
% of Gross Profit 63.04% 46.66% 41.99%
Operating Expenses $4.199M $33.47M $25.38M
YoY Change -39.01% 270.11% 318.47%
Operating Profit -$838.0K -$29.22M -$20.64M
YoY Change -77.48% 382.91% 488.61%
Interest Expense -$396.0K -$213.0K -$740.00
YoY Change 66.2% 30.56% -100.1%
% of Operating Profit
Other Income/Expense, Net -$1.507M -$473.1K -$1.416M
YoY Change -169.52% 924.95% -51.87%
Pretax Income -$2.345M -$29.69M -$22.05M
YoY Change 50.94% 387.01% 242.02%
Income Tax -$40.67K -$128.0K -$99.44K
% Of Pretax Income
Net Earnings -$2.304M -$29.57M -$21.95M
YoY Change 48.32% 384.27% 239.95%
Net Earnings / Revenue -42.57% -485.81% -315.83%
Basic Earnings Per Share -$0.59
Diluted Earnings Per Share -$0.59 -$0.83 -$694.6K
COMMON SHARES
Basic Shares Outstanding 80.29M shares 34.96M shares 32.05M shares
Diluted Shares Outstanding 3.884M shares 35.48M shares 1.580M shares

Balance Sheet

Concept 2022 Q3 2022 Q2 2022 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $2.491M $5.125M $9.688M
YoY Change -74.08% -56.49% -37.22%
Cash & Equivalents $2.491M $5.125M $9.688M
Short-Term Investments
Other Short-Term Assets $8.497M $1.431M $2.453M
YoY Change 248.61% -46.47% 20.23%
Inventory
Prepaid Expenses $2.330M $2.155M $2.492M
Receivables $1.371M $1.882M $2.579M
Other Receivables $841.5K $733.1K $547.7K
Total Short-Term Assets $13.20M $9.170M $15.27M
YoY Change -5.44% -44.35% -23.32%
LONG-TERM ASSETS
Property, Plant & Equipment $124.8K $143.0K $159.2K
YoY Change 138.45% 168.07% -86.03%
Goodwill $9.026M $9.080M $29.96M
YoY Change -80.71% -80.59% -28.44%
Intangibles
YoY Change
Long-Term Investments $226.1K $226.1K $226.1K
YoY Change 0.0% 0.0% -1.7%
Other Assets $9.700K $9.700K
YoY Change
Total Long-Term Assets $32.39M $34.00M $59.08M
YoY Change -46.5% -43.39% 8.56%
TOTAL ASSETS
Total Short-Term Assets $13.20M $9.170M $15.27M
Total Long-Term Assets $32.39M $34.00M $59.08M
Total Assets $45.59M $43.17M $74.35M
YoY Change -38.81% -43.6% 0.02%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.271M $3.793M $3.066M
YoY Change -29.75% 236.72% 518.34%
Accrued Expenses $2.276M $2.337M $3.208M
YoY Change -32.61% -34.27% 25.31%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change -100.0%
Long-Term Debt Due $9.900M $6.600M $13.20M
YoY Change -7.77% 50.34%
Total Short-Term Liabilities $19.99M $22.37M $30.38M
YoY Change 219.65% 67.26% 126.11%
LONG-TERM LIABILITIES
Long-Term Debt $4.575M $6.788M $2.137M
YoY Change 19.33% 465.36% 89.12%
Other Long-Term Liabilities $499.2K $602.1K $486.2K
YoY Change
Total Long-Term Liabilities $4.575M $6.788M $2.137M
YoY Change 19.33% 465.36% 89.12%
TOTAL LIABILITIES
Total Short-Term Liabilities $19.99M $22.37M $30.38M
Total Long-Term Liabilities $4.575M $6.788M $2.137M
Total Liabilities $25.50M $30.22M $33.57M
YoY Change 152.74% 107.4% 130.49%
SHAREHOLDERS EQUITY
Retained Earnings -$142.3M -$140.0M -$110.5M
YoY Change 99.63% 100.78% 73.58%
Common Stock $159.8M $150.4M $148.8M
YoY Change 20.36% 21.46% 34.14%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $20.09M $12.95M $40.78M
YoY Change
Total Liabilities & Shareholders Equity $45.59M $43.17M $74.35M
YoY Change -38.81% -43.6% 0.02%

Cashflow Statement

Concept 2022 Q3 2022 Q2 2022 Q1
OPERATING ACTIVITIES
Net Income -$2.304M -$29.57M -$21.95M
YoY Change 48.32% 384.27% 239.95%
Depreciation, Depletion And Amortization $2.119M $1.983M $1.993M
YoY Change 71.08% 50.56% 89.33%
Cash From Operating Activities -$3.263M -$3.602M -$3.585M
YoY Change 139.55% 53.59% 160.98%
INVESTING ACTIVITIES
Capital Expenditures -$1.587M -$1.117M -$647.0K
YoY Change 16.57% -14.34% -7.57%
Acquisitions
YoY Change
Other Investing Activities $0.00 $400.0K
YoY Change
Cash From Investing Activities -$1.587M -$717.5K -$647.0K
YoY Change 16.57% -45.0% -8.18%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 9.262M -761.4K -$5.615K
YoY Change 1554.73% 19675.84% -98.32%
NET CHANGE
Cash From Operating Activities -3.263M -3.602M -$3.585M
Cash From Investing Activities -1.587M -717.5K -$647.0K
Cash From Financing Activities 9.262M -761.4K -$5.615K
Net Change In Cash 4.411M -5.081M -$4.247M
YoY Change -303.85% 39.06% 75.92%
FREE CASH FLOW
Cash From Operating Activities -$3.263M -$3.602M -$3.585M
Capital Expenditures -$1.587M -$1.117M -$647.0K
Free Cash Flow -$1.677M -$2.485M -$2.938M
YoY Change 174540.63% 138.77% 336.08%

Facts In Submission

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<div style="border-left: none; border-right: none;"> <p style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt; text-align: justify;"><span style="font-family: 'Times New Roman'; font-size: 10pt; font-weight: bold;">Note 1 - Description of Business</span></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 10pt; font-style: italic; font-weight: bold;">Description of Business</span></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt; text-align: justify; text-indent: 33.3333pt; line-height: 1.2;"><span>Akerna Corp., herein referred to as we, us, our, the Company or Akerna, through our wholly-owned subsidiaries MJ Freeway, LLC, or MJF, Trellis Solutions, Inc., or Trellis, Ample Organics, Inc, the Company or Ample, solo sciences, inc., or Solo, Viridian Sciences Inc., or Viridian, and The NAV People, Inc. d.b.a. 365 Cannabis, or 365 Cannabis, provides enterprise software solutions that enable regulatory compliance and inventory management. Our proprietary, broad and growing suite of solutions are adaptable for industries in which interfacing with government regulatory agencies for compliance purposes is required, or where the tracking of organic materials from seed or plant to end products is desired. We develop products intended to assist states in monitoring licensed businesses’ compliance with state regulations and to help state-licensed businesses operate in compliance with such law. We provide our commercial software platform, MJ Platform®, Trellis®, Ample, Viridian and 365 Cannabis to state-licensed businesses, and our regulatory software platform, Leaf Data Systems®, to state government regulatory agencies. Through Solo, we provide an innovative, next-generation solution for state and national governments to securely track product and waste throughout the supply chain with solo*TAG™. The integration of MJ Platform® and solo*CODE™ results in technology for consumers and brands that brings a consumer-facing mark designed to highlight the authenticity and signify transparency.</span></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt; text-align: justify; text-indent: 33.3333pt; line-height: 1.3;"><span>Our Viridian and 365 Cannabis offerings are considered enterprise offerings while all other solutions are considered non-enterprise offerings that meet the needs of our small and medium-sized business, or SMB, customers.</span><br/></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'Times New Roman', serif; font-size: 10pt; margin: 0pt; text-align: justify; text-indent: 33.3333pt; line-height: 1.2;">We consult with clients on a wide range of areas to help them successfully maintain compliance with state laws and regulations. We provide project-focused consulting services to clients who are initiating or expanding their cannabis business operations or are interested in data consulting engagements with respect to the legal cannabis industry. Our advisory engagements include service offerings focused on compliance requirement assessments, readiness and best practices, compliance monitoring systems, application processes, inspection readiness, and business plan and compliance reviews. We typically provide our consulting services to clients in emerging markets that are seeking consultation on newly introduced licensing regimes and assistance with the regulatory compliant build-out of operations.</p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'Times New Roman', serif; font-size: 12pt; text-align: justify; line-height: 13pt; margin: 0cm 0cm 0.0001pt;"><b><i><span style="font-size: 10pt; color: #000000;">Going Concern and Management's Liquidity Plans</span></i></b></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'Times New Roman', serif; font-size: 10pt; text-align: justify; text-indent: 33.33pt; margin: 0pt 0pt 0.0001pt; line-height: 1.2;"><span style="font-size: 10pt; line-height: inherit;"><span>In accordance with the Financial Accounting Standards Board’s (“FASB”) standard on going concern, Accounting Standard Update (<span style="color: #000000; font-family: 'Times New Roman', serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">“</span>ASU<span style="color: #000000; font-family: 'Times New Roman', serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">”</span>) No. 2014-15, <span style="font-style: italic;">Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern</span> (<span style="color: #000000; font-family: 'Times New Roman', serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">“</span>ASU 2014-15<span style="color: #000000; font-family: 'Times New Roman', serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">”</span>), we assess going concern uncertainty in our consolidated financial statements to determine if we have sufficient cash, cash equivalents and working capital on hand, including marketable equity securities, and any available borrowings on loans, to operate for a period of at least one year from the date the consolidated financial statements are issued, which is defined to as the “look-forward period” in ASU 2014-15. As part of this assessment, based on conditions that are known and reasonably knowable to us, we will consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including the timing and nature of projected cash expenditures or programs, and our ability to delay or curtail expenditures or programs, if necessary, among other factors. Based on this assessment, as necessary or applicable, we make certain assumptions regarding implementing curtailments or delays in the nature and timing of programs and expenditures to the extent we deem probable that such implementations can be achieved and we have the proper authority to execute them within the look-forward period in accordance with ASU 2014-15.<br/></span></span></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p style="font-family: 'Times New Roman', serif; font-size: 12pt; text-align: justify; text-indent: 33.33pt; margin: 0pt 0pt 0.0001pt; line-height: 1.1;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; line-height: inherit; display: inline !important; background-color: #ffffff;"><span><span>The accompanying condensed consolidated financial statements have been prepared on the basis that we will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business. However, since our inception we have incurred recurring losses from operations, used cash from operating activities, and relied on capital raising transactions to continue ongoing operations. During the six months ended <span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; line-height: inherit; display: inline !important; background-color: #ffffff;">June 30</span>, 2022 and <span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; line-height: inherit; display: inline !important; background-color: #ffffff;">June 30</span>, 2021, we incurred losses from operations of $49.9 million and $9.6 million, respectively, and used cash in operating activities of $7.2 million and $</span>3.7<span> million, respectively. As of June 30, 2022, we had a working capital deficit of $13.2 million with $</span>5.1</span></span><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; line-height: inherit; display: inline !important;"><span><span><span style="background-color: #ffffff;"> million in cash available to fund future operations.</span> </span></span></span><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; background-color: #ffffff; display: inline !important; line-height: inherit;"><span><span>Furthermore, on May 24, 2022, we received a notice (the “Notice”) from The Nasdaq Stock Market LLC indicating that the bid price of the Company’s common stock, par value $0.0001 per share (“Common Stock”), is not currently in compliance with the requirement to maintain a minimum bid price of $1.00 per share for continued listing on the Nasdaq Capital Market (the “Nasdaq Market”). The Notice has no immediate effect on the continued listing status of our Common Stock on the Nasdaq Market, and, therefore, our listing remains fully effective. We are provided a compliance period of 180 calendar days from the date of the Notice, or until November 21, 2022, to regain compliance with the minimum closing bid requirement. These factors raise substantial doubt regarding the ability of  the Company to continue as a going concern.</span></span></span></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt; line-height: 1.1;"><span style="font-family: 'Times New Roman'; font-size: 4pt; line-height: inherit;"> </span></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <div style="font-family: 'times new roman', times; font-size: 10pt;"> </div> <p style="text-indent: 33.33pt; text-align: justify; margin: 0pt 0pt 0.0001pt; line-height: 1.1; font-size: 10pt;"><span><span style="font-size: 13.3333px; line-height: inherit;"> </span></span><span style="color: #000000; font-family: 'times new roman', times; font-size: 10pt; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"><span style="line-height: inherit;">Management’s <span>plan for the Company to continue as a going concern includes <span style="font-size: 10pt; line-height: inherit; font-family: 'times new roman', times;">several initiatives and actions including those impacting our short and intermediate term financing, continuing costs, primarily labor and employee benefits, our working capital and the liquidity of our Common Stock. Certain of these initiatives and actions began during the quarter ended June 30, 2022 while others were initiated in July 2022.</span></span></span></span></p> <p style="text-indent: 44.4444px; text-align: justify; margin: 0cm 0cm 0.0001pt; line-height: 1.2; font-size: 10pt;"><br/></p> <p style="text-indent: 33.33pt; text-align: justify; margin: 0pt 0pt 8pt; line-height: 1.1; font-size: 10pt;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 10pt; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"><span style="line-height: inherit;"><span> <span style="font-size: 10pt; line-height: inherit; font-family: 'Times New Roman', serif;">The most significant components of our plan include the following: </span><span style="border-left: none; border-right: none; line-height: inherit;"><span>(i) realizing annualized cost savings associated with the corporate restructuring initiative (the “Restructuring”) that we announced in May 2022 which resulted in a reduction in workforce and related operating costs (see Note 4), (ii) entering into an amendment and waiver agreement to the securities purchase agreement associated with our 2021 Senior Convertible Notes (the “Senior Convertible Notes”) on June 30, 2022 (the “Convertible Notes Amendment”) which, among other factors, provides for a deferral of the required amortization payments due and payable from July 1, 2022 through January 1, 2023 (see Note 4), (iii) deploying for working capital needs of the net proceeds of approximately $2 million received from our offering of Common Stock and warrants (the “Unit Offering”) in a transaction that closed on July 5, 2022 (see Note 4), net of underwriting discounts and commissions and other offering expenses and after depositing $7 million of the proceeds into certain restricted cash accounts in accordance with the Convertible Notes Amendment, (iv) conservatively managing our working capital through disciplined cost-containment efforts and strategic manag<span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">ement of our accounts receivable and accounts payable cycles (v) addressing the potential liquidity of our Common Stock in connection with the minimum listing requirements for the Nasdaq Market through a proposed </span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">1</span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">-to-</span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">20</span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"> reverse stock split (the <span style="line-height: inherit;">“</span>Reverse Stock Split”) and (vi) </span></span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"> continuing to seek to grow our customer base and realize synergies as we continue to integrate our recent acquisitions</span>.</span></span></span></span></p> <p style="text-indent: 33.33pt; margin: 0pt; line-height: 1.1; font-size: 11pt; font-family: Calibri, sans-serif; text-align: justify;"><span style="font-size: 10pt; line-height: inherit; font-family: 'Times New Roman', serif;">We anticipate the initiatives and actions described above will provide us with sufficient liquidity in order to operate our business in the normal course for the second half of 2022  until such time that the an earn-out payment associated with a 2021 acquisition is due in December 2022 (see Note 4), in part, to the fact that the debt service obligations associated with the Senior Convertible Notes for the first half of 2023 have effectively been substantially pre-funded with the amounts deposited into restricted accounts as required by the Convertible Notes Amendment. In the second half of 2022, we plan to continue to rigorously explore potential financing alternatives and other strategic options in addition to enhancing the liquidity of our Common Stock. In addition to and to the extent practical in the future, based on market conditions, we will consider incremental offerings of Common Stock through our previously authorized ATM Program; however, we do not consider this a viable alternative unless and until we are able to successfully address the minimum listing requirements of the Nasdaq Market with the proposed Reverse Stock Split. Through July 31, 2022, we have utilized $2.7 million of the total $25 million authorized by the ATM Program.</span></p> <p style="text-indent: 44.4444px; text-align: justify; margin: 0cm 0cm 0.0001pt; line-height: 1.2; font-size: 10pt;"><br/></p> <p style="text-indent: 33.33pt; text-align: justify; margin: 0pt 0pt 0.0001pt; line-height: 1.1; font-size: 10pt;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 10pt; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"><span style="line-height: inherit;"><span> If we are unable to <span>secure other potential financing alternatives or fail to execute any other strategic options to raise sufficient additional funds through the first half of 2023, including through the ATM Program, </span> we will have to develop and implement more aggressive plans to <span style="font-size: 10pt; line-height: inherit; font-family: 'Times New Roman', serif;">address our liquidity needs and our ability to satisfy the scheduled maturity of our obligations under the Senior Convertible Notes.</span> Such plans could include extending payables, further reductions of expenditures (including the termination of additional employees) and reducing or eliminating investments in and the funding of certain of our business units and initiatives, or otherwise substantially scale back our business plan until sufficient additional capital is raised through other equity or debt offerings. <span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 44.4444px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">Such offerings may include the issuance of shares of common stock, warrants to purchase common stock, preferred stock, convertible debt or other instruments that may dilute our current stockholders.</span> Accordingly, we may be subject to additional risks, including retention of key employees and limitations on the extension of credit by our vendors and other service providers. </span></span><span>If we are required to raise additional capital as discussed above and if we cannot timely raise additional funds, we may be unable to meet the financial covenants of the Senior Convertible Notes, which could result in an event of default under those instruments which could adversely impact the Company. See the risks detailed in our Form 10-K under “Item 1A. Risk Factors – Risks Relating to our Convertible Debt”.</span></span><br/></p> <p style="font-family: 'times new roman', times; font-size: 4pt; margin: 0pt;"><span style="font-family: 'Times New Roman'; font-size: 4pt;"> </span></p> <p class="ng-scope" style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: #ffffff; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; text-align: justify; text-indent: 33.33pt; line-height: 1.1;"><span style="font-family: 'times new roman', times; font-size: 10pt; line-height: inherit;">Our ability to continue as a going concern is dependent upon our ability to successfully execute the plans described above and attain profitable operations. <span style="font-size: 10pt; line-height: inherit; font-family: 'Times New Roman', serif;">Despite the comprehensive scope of our plans, the inherent risks associated with their successful execution are not sufficient to fully overcome </span></span><span style="font-family: 'times new roman', times; font-size: 10pt; line-height: inherit;">substantial doubt about our ability to continue as a going concern for </span>one<span style="font-family: 'times new roman', times; font-size: 10pt; line-height: inherit;"> year from the date of issuance of the consolidated financial statements. Accordingly, if we are unable to raise sufficient capital we may have to reduce operations which could significantly and adversely affect our results of operations. If we fail to meet the financial covenants of the Senior Convertible Notes and cannot obtain a waiver from such provisions or otherwise come to an agreement with the holders of our debt, such holders may declare a default on the debt which could subject our assets to seizure and sale, negatively impacting our business.</span></p> <p class="ng-scope" style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: #ffffff; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; text-align: justify; text-indent: 32pt; line-height: 1.2;"><br/></p> <p class="ng-scope" style="font-family: 'times new roman', times; font-size: 10pt; margin: 0pt; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: #ffffff; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; text-align: justify; text-indent: 33.33pt; line-height: 1.3;"><span style="font-family: 'times new roman', times; font-size: 10pt; line-height: inherit;">The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern.</span></p> </div>
kern Loss From Operations
LossFromOperations
49900000 usd
kern Loss From Operations
LossFromOperations
9600000 usd
us-gaap Net Cash Provided By Used In Operating Activities Continuing Operations
NetCashProvidedByUsedInOperatingActivitiesContinuingOperations
7200000 usd
us-gaap Net Cash Provided By Used In Operating Activities Continuing Operations
NetCashProvidedByUsedInOperatingActivitiesContinuingOperations
3700000 usd
CY2022Q2 kern Working Capital
WorkingCapital
13200000 usd
CY2022Q2 us-gaap Cash
Cash
5100000 usd
CY2022Q2 us-gaap Common Stock Par Or Stated Value Per Share
CommonStockParOrStatedValuePerShare
0.0001
kern Bid Price Per Share
BidPricePerShare
1
CY2021Q1 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
7705000 usd
us-gaap Substantial Doubt About Going Concern Conditions Or Events
SubstantialDoubtAboutGoingConcernConditionsOrEvents
<span>(i) realizing annualized cost savings associated with the corporate restructuring initiative (the “Restructuring”) that we announced in May 2022 which resulted in a reduction in workforce and related operating costs (see Note 4), (ii) entering into an amendment and waiver agreement to the securities purchase agreement associated with our 2021 Senior Convertible Notes (the “Senior Convertible Notes”) on June 30, 2022 (the “Convertible Notes Amendment”) which, among other factors, provides for a deferral of the required amortization payments due and payable from July 1, 2022 through January 1, 2023 (see Note 4), (iii) deploying for working capital needs of the net proceeds of approximately $2 million received from our offering of Common Stock and warrants (the “Unit Offering”) in a transaction that closed on July 5, 2022 (see Note 4), net of underwriting discounts and commissions and other offering expenses and after depositing $7 million of the proceeds into certain restricted cash accounts in accordance with the Convertible Notes Amendment, (iv) conservatively managing our working capital through disciplined cost-containment efforts and strategic manag<span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">ement of our accounts receivable and accounts payable cycles (v) addressing the potential liquidity of our Common Stock in connection with the minimum listing requirements for the Nasdaq Market through a proposed </span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">1</span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">-to-</span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;">20</span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"> reverse stock split (the <span style="line-height: inherit;">“</span>Reverse Stock Split”) and (vi) </span></span><span style="font-size: 10pt; font-family: 'Times New Roman', serif; border-left: none; border-right: none; color: #000000; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important; line-height: inherit;"> continuing to seek to grow our customer base and realize synergies as we continue to integrate our recent acquisitions</span>.
kern Description Of Liquidity And Capital Resources
DescriptionOfLiquidityAndCapitalResources
We anticipate the initiatives and actions described above will provide us with sufficient liquidity in order to operate our business in the normal course for the second half of 2022  until such time that the an earn-out payment associated with a 2021 acquisition is due in December 2022 (see Note 4), in part, to the fact that the debt service obligations associated with the Senior Convertible Notes for the first half of 2023 have effectively been substantially pre-funded with the amounts deposited into restricted accounts as required by the Convertible Notes Amendment. In the second half of 2022, we plan to continue to rigorously explore potential financing alternatives and other strategic options in addition to enhancing the liquidity of our Common Stock. In addition to and to the extent practical in the future, based on market conditions, we will consider incremental offerings of Common Stock through our previously authorized ATM Program; however, we do not consider this a viable alternative unless and until we are able to successfully address the minimum listing requirements of the Nasdaq Market with the proposed Reverse Stock Split. Through July 31, 2022, we have utilized $2.7 million of the total $25 million authorized by the ATM Program.
us-gaap Use Of Estimates
UseOfEstimates
<p style="margin: 0cm; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif;"><span style="font-family: 'times new roman', times;"><b><i><span style="font-size: 10.0pt;">Use of Estimates</span></i></b></span></p> <p style="margin: 0cm; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif; ;margin: 0px !important;"><br/></p> <p style="margin: 0pt; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 33.3333pt;"><span style="font-size: 10pt; line-height: inherit;"><span style="font-family: 'times new roman', times; line-height: inherit;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 48px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">The preparation of our consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts included in the consolidated financial statements and accompanying notes thereto. Our most significant estimates and assumptions are related to the valuation of acquisition-related assets and liabilities, capitalization of internal costs associated with software development, fair value measurements, impairment assessments, loss contingencies, valuation allowance associated with deferred tax assets, stock based compensation expenses, and useful lives of long-lived intangible assets. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Accordingly, actual results could differ from those estimates. </span></span></span><span style="font-size: 10pt; line-height: inherit;"><span style="font-family: 'times new roman', times; line-height: inherit;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 48px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;"><br/></span></span></span></p> <p style="margin: 0pt; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 33.3333pt;"><span style="font-size: 10pt; line-height: inherit;"><span style="font-family: 'times new roman', times; line-height: inherit;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 48px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;"><br/></span></span></span></p> <p style="margin: 0pt; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 0pt;"><span style="font-size: 10pt; line-height: inherit; font-style: italic; font-weight: bold;"><span style="font-family: 'times new roman', times; line-height: inherit;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-variant-ligatures: normal; font-variant-caps: normal; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 48px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;">Subsequent Events</span></span></span></p> <p style="margin: 0pt; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 0pt;"><span style="font-size: 10pt; line-height: inherit; font-style: italic; font-weight: bold;"><span style="font-family: 'times new roman', times; line-height: inherit;"><span style="color: #000000; font-family: 'times new roman', times; font-size: 13.3333px; font-variant-ligatures: normal; font-variant-caps: normal; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 48px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; float: none; display: inline !important;"><br/></span></span></span></p> <p style="margin: 0pt; text-align: justify; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 33.33pt;">Management has evaluated all of our activities through the issuance date of our condensed consolidated financial statements and has concluded that, with the exception of the issuance of common stock and warrants in an offering that closed on July 5, 2022, as disclosed in Note 4, no subsequent events have occurred that would require recognition in our condensed consolidated financial statements or disclosure in the notes thereto.</p>
CY2022Q2 us-gaap Allowance For Doubtful Accounts Receivable Current
AllowanceForDoubtfulAccountsReceivableCurrent
700000 usd
CY2021Q4 us-gaap Allowance For Doubtful Accounts Receivable Current
AllowanceForDoubtfulAccountsReceivableCurrent
300000 usd
us-gaap Concentration Risk Credit Risk
ConcentrationRiskCreditRisk
<p style="margin: 0cm; font-size: 10pt; font-family: 'Times New Roman', serif; line-height: 1.3;"><span style="font-family: 'times new roman', times; line-height: inherit;"><b><i><span style="font-size: 10pt; line-height: inherit;">Concentrations of Credit Risk</span></i></b></span></p> <p style="margin: 0cm; font-size: 10pt; font-family: 'Times New Roman', serif; line-height: 1.3; ;margin: 0px !important;"><br/></p> <p style="margin: 0pt; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 33.3333pt; line-height: 1.3; text-align: justify;"><span style="font-size: 10pt; color: #000000; font-family: 'times new roman', times; line-height: inherit;">We grant credit in the normal course of business to customers in the United States and Canada. We periodically perform credit analysis and monitor the financial condition of our customers to reduce credit risk. </span></p> <p style="margin: 0pt; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 33.3333pt; line-height: 1.3; ;margin: 0px !important;"><br/></p> <p style="margin: 0pt; font-size: 10pt; font-family: 'Times New Roman', serif; text-indent: 33.3333pt; line-height: 1.3; text-align: justify;"><span><span style="font-size: 10pt; color: #000000; line-height: inherit;"><span>During the six<span style="border-left: none; border-right: none;"> months ended June 30, 2022</span> and 2021, one government client accounted for 11<span>% and 11%</span> of total revenues, respectively.  <span style="background-image: initial; background-position: initial; background-size: initial; background-repeat: initial; background-attachment: initial; background-origin: initial; background-clip: initial; line-height: inherit;">As of June 30, 2022, </span>one government client accounted for 30% of net accounts receivable and as of December 31, 2021 two government clients accounted for 37% of net accounts receivable. </span></span></span></p>
us-gaap Number Of Operating Segments
NumberOfOperatingSegments
1 pure
CY2022Q2 us-gaap Noncurrent Assets
NoncurrentAssets
34163 usd
CY2021Q4 us-gaap Noncurrent Assets
NoncurrentAssets
37585 usd
us-gaap Revenue From Contract With Customer Including Assessed Tax
RevenueFromContractWithCustomerIncludingAssessedTax
13037 usd
us-gaap Revenue From Contract With Customer Including Assessed Tax
RevenueFromContractWithCustomerIncludingAssessedTax
8921 usd
kern Adjustedforadoption
Adjustedforadoption
13037 usd
kern Adjustedforadoption
Adjustedforadoption
8921 usd
CY2022Q2 kern Unsatisfied Performance Obligations
UnsatisfiedPerformanceObligations
22300000 usd
kern Revenueexpectedtoberecognized
Revenueexpectedtoberecognized
11900000 usd
CY2021Q4 us-gaap Deferred Revenue
DeferredRevenue
4126000 usd
us-gaap Deferred Revenue Additions
DeferredRevenueAdditions
8881000 usd
us-gaap Deferred Revenue Revenue Recognized1
DeferredRevenueRevenueRecognized1
10002000 usd
CY2022Q2 us-gaap Deferred Revenue
DeferredRevenue
3005000 usd
CY2022Q2 us-gaap Deferred Income
DeferredIncome
13000000 usd
CY2021Q4 us-gaap Deferred Income
DeferredIncome
3100000 usd
CY2021Q4 us-gaap Contract With Customer Liability
ContractWithCustomerLiability
261 usd
us-gaap Additions To Contract Holders Funds
AdditionsToContractHoldersFunds
279 usd
kern Amortized Costs
AmortizedCosts
246 usd
CY2022Q2 us-gaap Contract With Customer Liability
ContractWithCustomerLiability
294 usd
CY2022Q2 kern Convertible Notes Amendment Description
ConvertibleNotesAmendmentDescription
we and the holders Senior Convertible Notes entered into the Convertible Notes Amendment to add covenants such that (a) we will be subject to a daily cash test beginning on July 1, 2022 of having an available cash balance of at least $7 million, which amount shall be reduced by $1 million on each of the dates at which the aggregate principal due upon the Senior Convertible Notes is equal to or less than $14 million and $11 million, subject in all cases to a minimum of $5 million, and (b) we will establish and maintain bank accounts for each holder and deposit in such accounts an aggregate amount of $7 million with such amount to be released from the accounts only upon the written consent of such holder, provided that $1 million will automatically release from the accounts upon the occurrence of each of the dates at which the aggregate principal due upon the Senior Convertible Notes is equal to or less than $14 million and $11 million, subject to certain conditions. Further the holders of the Senior Convertible Notes waived provisions such that (i) no amortization payments are due and payable for any payments previously required to be made from July 1, 2022 through January 1, 2023, (ii) the holders of the Senior Convertible Notes will not accelerate any previously deferred installment amounts until January 1, 2023 and (iii) the terms of the Senior Convertible Notes which would provide for reset of the conversion price of the Senior Convertible Notes as a result of the issuance of securities under the Unit Offering and instead agree to a reset of the conversion price equal to a per share price of 135% of the Unit Offering price, or $0.3105 per unit.
kern Descriptionofunitoffering
Descriptionofunitoffering
(i) 29,382,861 units of the Company consisting of 29,382,861 shares of Common Stock together with Common Stock warrants (the “Common Warrants”) to purchase up to 29,382,861 shares of Common Stock and (ii) 14,095,400 pre-funded units, consisting of 14,095,400 pre-funded warrants (“Pre-Funded Warrants”), with each Pre-Funded Warrant exercisable for one share of Common Stock, together with Common Warrants to purchase up to 14,095,400 shares of Common Stock. The units were sold at a public offering price of $0.23 per unit and the pre-funded units were sold at a public offering price of $0.2299 per pre-funded unit.
CY2022Q2 us-gaap Class Of Warrant Or Right Exercise Price Of Warrants Or Rights1
ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1
0.23
us-gaap Stock Issued During Period Shares Other
StockIssuedDuringPeriodSharesOther
1 shares
CY2022Q2 us-gaap Share Price
SharePrice
0.0001
kern Underwritingagreementdescription
Underwritingagreementdescription
the Underwriting Agreement, we granted the Underwriter a 45-day option from June 30, 2022 to purchase from the Company (i) additional shares of Common Stock and/or (ii) Common Warrants and/or (iii) Pre-Funded Warrants, in any combination thereof, up to, and not to exceed, 13,043,478 shares of Common Stock or shares of Common Stock underlying Pre-Funded Warrants or Common Warrants, in the aggregate, solely to cover over-allotments, if any.
kern Commonstockofferingpercentage
Commonstockofferingpercentage
0.05 pure
CY2022Q2 us-gaap Class Of Warrant Or Right Exercise Price Of Warrants Or Rights1
ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1
0.23
CY2022Q3 us-gaap Proceeds From Debt Net Of Issuance Costs
ProceedsFromDebtNetOfIssuanceCosts
9.3 usd
CY2022Q2 us-gaap Convertible Notes Payable
ConvertibleNotesPayable
7 usd
CY2022Q2 us-gaap Business Acquisition Cost Of Acquired Entity Transaction Costs
BusinessAcquisitionCostOfAcquiredEntityTransactionCosts
0.5 usd
CY2022Q2 us-gaap Marketing Expense
MarketingExpense
300000 usd
CY2022Q2 us-gaap Development Costs
DevelopmentCosts
200000 usd
CY2022Q2 us-gaap Other General And Administrative Expense
OtherGeneralAndAdministrativeExpense
100000 usd
kern Reduction Of Purchase Price
ReductionOfPurchasePrice
25 usd
CY2022Q2 kern Exchangeable Shares
ExchangeableShares
1 shares
kern Reduction Of Working Capital
ReductionOfWorkingCapital
1.5 usd
CY2022Q2 kern Commonstockofferingpercentage
Commonstockofferingpercentage
0.25 pure
CY2022Q2 us-gaap Repayments Of Convertible Debt
RepaymentsOfConvertibleDebt
2080000 usd
CY2022Q2 kern Prepaid Expenses Software And Technology
PrepaidExpensesSoftwareAndTechnology
470505 usd
CY2021Q4 kern Prepaid Expenses Software And Technology
PrepaidExpensesSoftwareAndTechnology
687740 usd
CY2022Q2 kern Prepaid Professional Fees
PrepaidProfessionalFees
505282 usd
us-gaap Business Acquisitions Pro Forma Revenue
BusinessAcquisitionsProFormaRevenue
14698 usd
us-gaap Business Acquisitions Pro Forma Net Income Loss
BusinessAcquisitionsProFormaNetIncomeLoss
13317 usd
CY2021Q2 us-gaap Business Acquisitions Pro Forma Revenue
BusinessAcquisitionsProFormaRevenue
7291 usd
CY2021Q2 us-gaap Business Acquisitions Pro Forma Net Income Loss
BusinessAcquisitionsProFormaNetIncomeLoss
6743 usd
CY2022Q2 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.0001
CY2022Q2 us-gaap Preferred Stock Liquidation Preference
PreferredStockLiquidationPreference
1
CY2021Q4 kern Prepaid Professional Fees
PrepaidProfessionalFees
546126 usd
CY2022Q2 us-gaap Prepaid Insurance
PrepaidInsurance
74196 usd
CY2021Q4 us-gaap Prepaid Insurance
PrepaidInsurance
264097 usd
CY2022Q2 us-gaap Other Prepaid Expense Current
OtherPrepaidExpenseCurrent
293618 usd
CY2021Q4 us-gaap Other Prepaid Expense Current
OtherPrepaidExpenseCurrent
260899 usd
CY2022Q2 us-gaap Unbilled Contracts Receivable
UnbilledContractsReceivable
733045 usd
CY2021Q4 us-gaap Unbilled Contracts Receivable
UnbilledContractsReceivable
506984 usd
CY2022Q2 us-gaap Other Assets
OtherAssets
78800 usd
CY2021Q4 us-gaap Other Assets
OtherAssets
117918 usd
CY2022Q2 us-gaap Prepaid Expense Current
PrepaidExpenseCurrent
2155446 usd
CY2021Q4 us-gaap Prepaid Expense Current
PrepaidExpenseCurrent
2383764 usd
CY2022Q2 us-gaap Accounts Payable Current
AccountsPayableCurrent
3793079 usd
CY2021Q4 us-gaap Accounts Payable Current
AccountsPayableCurrent
1943457 usd
CY2022Q2 us-gaap Accrued Professional Fees Current
AccruedProfessionalFeesCurrent
182015 usd
CY2021Q4 us-gaap Accrued Professional Fees Current
AccruedProfessionalFeesCurrent
319590 usd
CY2022Q2 us-gaap Sales And Excise Tax Payable Current
SalesAndExciseTaxPayableCurrent
572567 usd
CY2021Q4 us-gaap Sales And Excise Tax Payable Current
SalesAndExciseTaxPayableCurrent
360361 usd
CY2022Q2 us-gaap Accrued Employee Benefits Current
AccruedEmployeeBenefitsCurrent
901304 usd
CY2021Q4 us-gaap Accrued Employee Benefits Current
AccruedEmployeeBenefitsCurrent
1123467 usd
CY2022Q2 kern Accrued Contractors
AccruedContractors
551388 usd
CY2021Q4 kern Accrued Contractors
AccruedContractors
1288730 usd
CY2022Q2 us-gaap Settlement Liabilities Current
SettlementLiabilitiesCurrent
920736 usd
CY2021Q4 us-gaap Settlement Liabilities Current
SettlementLiabilitiesCurrent
681045 usd
CY2022Q2 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
129590 usd
CY2021Q4 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
346870 usd
CY2022Q2 us-gaap Accounts Payable And Accrued Liabilities Current
AccountsPayableAndAccruedLiabilitiesCurrent
7050679 usd
CY2021Q4 us-gaap Accounts Payable And Accrued Liabilities Current
AccountsPayableAndAccruedLiabilitiesCurrent
6063520 usd
CY2020Q2 us-gaap Convertible Debt
ConvertibleDebt
17000000 usd
CY2020Q2 kern Debt Purchase Price
DebtPurchasePrice
15000000 usd
CY2020Q2 us-gaap Debt Instrument Maturity Date
DebtInstrumentMaturityDate
2021-10-05
CY2021Q4 us-gaap Convertible Debt
ConvertibleDebt
20000000 usd
CY2021Q4 kern Debt Purchase Price
DebtPurchasePrice
18000000 usd
CY2022Q1 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
15337000 usd
CY2021Q2 us-gaap Repayments Of Convertible Debt
RepaymentsOfConvertibleDebt
1572405 usd
CY2022Q2 kern Changes In Fair Value Reported In Statements Of Operations
ChangesInFairValueReportedInStatementsOfOperations
294000 usd
CY2021Q2 kern Changes In Fair Value Reported In Statements Of Operations
ChangesInFairValueReportedInStatementsOfOperations
16405 usd
CY2022Q2 kern Change In Fair Value Reported In Other Comprehensive Income
ChangeInFairValueReportedInOtherComprehensiveIncome
163000 usd
CY2021Q2 kern Change In Fair Value Reported In Other Comprehensive Income
ChangeInFairValueReportedInOtherComprehensiveIncome
3000 usd
CY2022Q2 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
13388000 usd
CY2021Q4 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
17305000 usd
CY2020Q4 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
13398000 usd
us-gaap Repayments Of Convertible Debt
RepaymentsOfConvertibleDebt
5380000 usd
us-gaap Repayments Of Convertible Debt
RepaymentsOfConvertibleDebt
9269677 usd
kern Changes In Fair Value Reported In Statements Of Operations
ChangesInFairValueReportedInStatementsOfOperations
1727000 usd
kern Changes In Fair Value Reported In Statements Of Operations
ChangesInFairValueReportedInStatementsOfOperations
2007677 usd
kern Change In Fair Value Reported In Other Comprehensive Income
ChangeInFairValueReportedInOtherComprehensiveIncome
-264000 usd
kern Change In Fair Value Reported In Other Comprehensive Income
ChangeInFairValueReportedInOtherComprehensiveIncome
16000 usd
CY2022Q2 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
13388000 usd
CY2021Q2 us-gaap Convertible Debt Fair Value Disclosures
ConvertibleDebtFairValueDisclosures
6152000 usd
kern Equity Instrument Convertible Conversion Ratio
EquityInstrumentConvertibleConversionRatio
1 pure
kern Termination Fee
TerminationFee
500000 usd
us-gaap Antidilutive Securities Excluded From Computation Of Earnings Per Share Amount
AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount
53642667 shares
us-gaap Antidilutive Securities Excluded From Computation Of Earnings Per Share Amount
AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount
9645604 shares
us-gaap Debt Instrument Convertible Conversion Price Decrease
DebtInstrumentConvertibleConversionPriceDecrease
0.3105
us-gaap Debt Instrument Convertible Conversion Price Increase
DebtInstrumentConvertibleConversionPriceIncrease
4.05
CY2022Q2 kern Weighting To The Market Approach
WeightingToTheMarketApproach
0.50 pure
CY2022Q2 kern Weighted To The Income Approach
WeightedToTheIncomeApproach
0.50 pure
kern Impairment Expenses
ImpairmentExpenses
23500000 usd
us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
EffectiveIncomeTaxRateReconciliationAtFederalStatutoryIncomeTaxRate
0.0044 pure
us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
EffectiveIncomeTaxRateReconciliationAtFederalStatutoryIncomeTaxRate
0.0008 pure
us-gaap Operating Loss Carryforwards Limitations On Use
OperatingLossCarryforwardsLimitationsOnUse
80%
CY2022Q2 us-gaap Unrecognized Tax Benefits Income Tax Penalties And Interest Accrued
UnrecognizedTaxBenefitsIncomeTaxPenaltiesAndInterestAccrued
0.1 usd

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