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Subsequent Events
12 Months Ended
Dec. 31, 2021
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

18. SUBSEQUENT EVENTS

 

Management evaluated for subsequent events requiring disclosure within the financial statements through the date of the filing of this report and noted the following items.

 

On January 31, 2022, AZCOMS completed the sale of the land and building for approximately $15.8 million and $5.2 million of the principal amount of this loan and all accrued interest and fees with a combined total of $5.1 million was fully repaid.

 

On February 1, 2022, the Company entered into a 10-year lease for 140,405 square feet of commercial space. The lease commenced on February 1, 2022 and will expire on January 31, 2032. The lease did not include an implicit rate of return; therefore, the Company used an incremental borrowing rate based on other leases with similar terms. However, the Company defaulted on this lease on or about March 1, 2022, and the Company vacated the premises in May of 2022.

 

On April 21, 2022 the Company’s Chief Financial Officer resigned from the Company for personal family commitments.

 

On May 2, 2022 a member of the Board of Directors (the “Board”) of the “Company announced their resignation from the Board and all committees thereof, effective immediately. The resignation allowed the former member of the Board of Directors to focus on personal and other professional commitments.

 

Commencing in May 2022, the Company has embarked on a restructuring, including a reduction of over 70% of overhead and personnel through the divestment of non and underperforming assets and non-core activities in favor of a refocus on our true core competencies in 5G and beyond technology.

 

In May, 2022, InduraPower suspended operations.

 

On May 23, 2022, Syntronic Production Services Canada Inc. acquired certain assets and employees from DragonWave X Canada, Inc., the Canadian subsidiary of DragonWave, in returns for assuming employment liabilities and the assumption of a lease in Kanata, Ontario, Canada, through an Asset Purchase Agreement.

 

On May 24, 2022, the Company received notice from counsel for holders of Convertible Promissory Notes issued in connection with the acquisition of Fastback that the Company had failed to file its Annual Report on Form 10-K in a timely manner as required by the terms of the Convertible Promissory Notes and that the holders were reserving their rights.

In June, 2022, SAGUNA and SKS were idled.

 

On June 16, 2022, the Company received notice from certain former shareholders of SAGUNA claiming breaches of the SAGUNA stock purchase agreement, which the Company denies. The Company may face legal claims or proceedings regarding those claims.

 

On June 21, 2022, the Company received notice from counsel for 2 former employees of Fastback for wage related claims of approximately $86,000 under California law.

On June 21, 2022 the Company sold its Sovereign Plastics business unit for total consideration of $2 million to TheLandersCompanies LLC.

 

On June 23, the Company reached an agreement with the former owners of Innovation Digital to return to the former owners of Innovation Digital 15 patents and 5 pending or provisional patents to those former owners in return for the cancelation of an outstanding $600,000 convertible promissory note, the return of 500,000 shares of common stock, and the waiver of certain severance payments.

 

By notice dated July 14, 2022, the Company received notice from a distributor with a distribution agreement with InduraPower claiming that InduraPower, and the Company as guarantor. has breached the distribution agreement, and are claiming approximately $2,000,000 in damages.

 

On July 17, 2022, certain former employees of SAGUNA filed an insolvency action against SAGUNA in the Nazareth District Court, Israel.

 

On July 25, 2022, an employee filed a lawsuit in the San Diego, California, Superior Court claiming wages and other amounts due of over $238,000.

 

On July 26, 2022, the Company received notice from a promissory note holder that the promissory note in the principal amount of $550,000 was due.

 

Nasdaq Compliance

 

On January 18, 2022, we received a notification letter from the Listing Qualifications Department of the Nasdaq Capital Market indicating that we were not in compliance with the $1.00 minimum closing bid price requirement. We were given a grace period of 180 days from the notification, or until July 18, 2022, to regain compliance, by having the closing bid price of our common stock exceed $1.00 for a minimum of ten (10) consecutive trading days during the grace period. We did not regain compliance by July 18, 2022. On July 20, 2022, the Company submitted its compliance plan to Nasdaq with a request for a second 180 day compliance period regarding the bid price compliance, including an intent to implement a reverse stock split in sufficient time during the 180 days to evidence a closing bid price of at least $1.00 per share for a minimum of ten consecutive business days prior to the expiration of the second compliance period.

 

On July 22, 2022, Nasdaq granted the Company's request for the second 180 day compliance period, or until January 16, 2023, to regain compliance with the bid price. There is no assurance, however, that we will regain compliance during the grace period.

 

On April 19, 2022, the Company received a notice from Nasdaq stating that because the Company has not yet filed the Form 10-K, the Company is no longer in compliance with Nasdaq Listing Rule 5250(c)(1), which requires listed companies to timely file all required periodic financial reports with the SEC.

 

On May 18, 2022, the Company received a notice from Nasdaq stating that because the Company has not yet filed the Form10-K or its Quarterly Report on Form10-Q for the quarter ended March 31, 2022 (the "Form10-Q”), the Company is not in compliance with Nasdaq Listing Rules. The Company had until June 20, 2022 to submit to Nasdaq a plan to regain compliance with respect to these delinquent reports.

 

On July 21, 2022, the Company submitted its compliance plan to Nasdaq to get the Company's reporting current.

 

On July 22, 2022, Nasdaq granted the Company's request for a compliance period to comply with Nasdaq Listing Rule 5250(c)(1), which requires listed companies to timely file all required periodic financial reports with the SEC. This extension requires that on or before September 1, 2022, the Company must file the late Form 10-K and Form 10-Q, as well as any other periodic report due within that time frame, namely the Form 10-Q for the period ended June 30, 2022. In the event the Company does not satisfy that time frame, Nasdaq will provide written notification that its securities will be delisted.