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Note 16 - Subsequent Events
3 Months Ended
Mar. 31, 2021
Notes to Financial Statements  
Subsequent Events [Text Block]

16. Subsequent Event

 

On April 1, 2021, we entered into a lease agreement for approximately 47,533 square feet in the Netherlands. The term of our lease began on April 1, 2021 and continues until March 31, 2026, with options to extend the lease for an additional five years at each expiration date. In accordance with the lease agreement, the monthly base rent is approximately €28,726 (approximately $33,734 as of March 31, 2021) at commencement and includes provisions for rent increases tied to the Netherlands consumer price index in January of each year.

 

GCI Acquisition

 

On May 3, 2021, the Company completed the acquisition of Global Cooling, Inc. (“Global Cooling”), which became a wholly owned subsidiary of the Company. Global Cooling is a manufacturer of ultra-low temperature freezers. At the closing of the acquisition, the Company issued to the sellers 6,038,252 shares of common stock with an additional 598,218 shares of common stock retained in escrow as the sole and exclusive source of payment for any post-closing indemnification claims (other than fraud claims). The escrow shares, as reduced for any valid indemnification claims, are to be issued no later than 24 months after the closing of the transaction.

 

In connection with the acquisition and effective as of the closing, Maurice “Dusty” Tenney, the Chief Executive Officer of Global Cooling prior to the acquisition, was appointed as President and Chief Operating Officer of the Company. In connection therewith, Michael Rice, the Company’s Chief Executive Officer and President, resigned from his position as President and Roderick de Greef, the Company’s Chief Financial Officer and Chief Operating Officer, resigned from his position as Chief Operating Officer. Mr. Rice will continue to serve as the Company’s Chief Executive Officer and Mr. de Greef will continue to serve as the Company’s Chief Financial Officer.

 

We incurred $902,000 of related acquisition costs for the three month period ending March 31, 2021, which are reflected in our Condensed Consolidated Statement of Operations. We expect to report Global Cooling as a consolidated entity as of June 30, 2021. The acquisition qualifies as a business combination and will be accounted for using the acquisition method of accounting.

 

Due to the limited time since the acquisition date and the effort required to assess the fair value of assets acquired and liabilities assumed, the initial accounting for the business combination is incomplete at the time of this filing. As a result, the Company is unable to provide the amounts recognized for the major classes of assets acquired and liabilities assumed, acquisition contingencies and goodwill. Also, the Company is unable to provide pro forma revenues and earnings of the combined entity. This information is expected to be included in the Company's Quarterly Report on Form 10-Q for the three and six months ended June 30, 2021.