Business Combinations

9 Months Ended

Sep. 30, 2015

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

3. Business Combinations

There were no business combinations during the nine month period ended September 30, 2015.

On May 1, 2014, WidePoint Global Solutions, Inc. (“WGS”), a wholly-owned subsidiary of the Company entered into a Share Sale and Purchase Agreement (the “Agreement”), with Gutteridge Limited (“Gutteridge”), a wholly-owned subsidiary of Soft-Ex Holdings Limited (“SHL”), and the shareholders of Soft-Ex Holdings Limited, pursuant to which WGS purchased all of the outstanding equity of Soft-ex Communications Limited (“SCL”). As a result of this transaction, SCL became a wholly-owned subsidiary of WidePoint. WidePoint acquired all of the outstanding equity of SCL for $6.0 million. The purchase price for the outstanding equity of SCL consisted of (i) the payment at closing of cash in the amount of $5 million, subject to a post-closing net working capital adjustment, and (ii) the delivery of a contingent subordinated unsecured loan note in the principal amount of $1.0 million (the “Contingent Note”). The Company’s outstanding Contingent Note was paid in full on May 30, 2015 as further described in Note 8. See Note 4 for additional information regarding the fair value of the Contingent Note.

Supplemental Unaudited Pro Forma Information

The following unaudited pro forma condensed consolidated statements of operations of WidePoint for the three and nine month periods ended September 30, 2014 have been prepared as if the acquisition of SCL had occurred at January 1, 2014:

	THREE		NINE
	MONTHS ENDED		MONTHS ENDED
	SEPTEMBER 30,		SEPTEMBER 30,
	2014		2014
	(a)		(a)
	(Unaudited)
Revenues, net	$	14,556,000	$	38,487,000
Net loss	$	(5,901,000)	$	(7,627,000)
Basic (loss) earnings per share	$	(0.081)	$	(0.107)
Diluted (loss) earnings per share	$	(0.081)	$	(0.107)

(a) To reflect on a pro forma basis unaudited consolidated financial information for the three and nine month periods ended September 30, 2014 for WidePoint. The unaudited financial information presented herein were derived from historical internally prepared financial statements for SCL and WidePoint’s Form 10-Q quarterly unaudited financial statements. SCL’s financial statements are prepared in accordance with Irish GAAP, as such additional adjustments were made to convert SCL Irish GAAP presentation to a US GAAP presentation to align with WidePoint’s accounting policies. SCL’s reporting currency unit is the Euro. SCL’s US GAAP unaudited historical statement of operations for the three and nine month period ended June 30, 2014 were translated into WidePoint’s reporting currency using an average USD/EURO rate of $1.3266 and $1.3560, respectively.