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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Ameri Holdings Inc | NASDAQ:AMRH | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 1.48 | 1.47 | 1.50 | 0 | 01:00:00 |
For the fiscal year ended December 31, 2017
|
Commission file number 001-38286
|
Delaware
|
95-4484725
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
100 Canal Pointe Boulevard, Suite 108,
Princeton, New Jersey
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08540
|
|
(Address of principal executive offices)
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(Zip Code)
|
Title of Each Class
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Name of Each Exchange On Which Registered
|
|
Common Stock $0.01 par value per share
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The NASDAQ Stock Market LLC
|
|
Warrants to Purchase Common Stock
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The NASDAQ Stock Market LLC
|
Large accelerated filer
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☐
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Accelerated filer
|
☐
|
Non-accelerated filer
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☐
(Do not check if a smaller reporting company)
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Smaller reporting company
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☒
|
Emerging growth company
|
☒
|
Item 1.
|
1
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|
Item 1A.
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9 | |
Item 1B.
|
27 | |
Item 2.
|
27 | |
Item 3.
|
27 | |
Item 4.
|
27 | |
Item 5.
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28 | |
Item 6.
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31 | |
Item 7.
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31 | |
Item 7A.
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41 | |
Item 8.
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41 | |
Item 9.
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41 | |
Item 9A.
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41 | |
Item 9B.
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42 | |
Item 10.
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43 | |
Item 11.
|
43 | |
Item 12.
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43 | |
Item 13.
|
43 | |
Item 14.
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43 | |
Item 15.
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44 | |
F-1
|
PART I
|
Characteristic
|
Description
|
|
Mature Market
|
●
|
Most large global companies have already outsourced what they wanted to outsource.
|
Commoditized Business Model
|
●
|
North America and Europe continue to be the markets with attractive spending potential. However, increased regulations and visa dependencies prove to be a major drawback of the model.
|
●
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The benefits realized from the business model are largely based on labor arbitrage, productivity benefits and portfolio restructuring. These contours have changed due to commoditization.
|
|
Insourcing
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●
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Extremely rapid changes in technology are forcing IT services–traditionally an outsourcing business—to adopt an insourcing model.
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Rapid Technology Shifts
|
●
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Cloud services, robotic process automation, artificial intelligence and internet of things are increasingly in demand as part of outsourcing engagements. Smart robots increasingly operate in the cloud, and a ‘labor-as-a-service’ approach has emerged, as clients and providers find that intelligent tools and virtual agents can be easily and flexibly hosted on cloud platforms.
|
●
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Social media, cloud computing, mobility and big data will continue to be mainstays for any IT ecosystem.
|
|
●
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The convergence of cloud computing, virtualization (applications and infrastructure) and utility computing is around the corner. The ability of a vendor to offer an integrated basket of services on a SaaS model, will be a key differentiator.
|
|
●
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Enterprises are becoming more digital. There is a strong convergence of human and machine intelligence thanks to drivers like advanced sensors and machine learning. Operations and technology are converging.
|
|
Contracts & Decision Making
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●
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Large multi-year contracts will be renegotiated and broken down into shorter duration contracts and will involve multiple vendors rather than sole sourcing.
|
●
|
The ability to demonstrate value through Proof of Concepts (POCs) and willingness to offer outcome based pricing are becoming critical considerations for decision making, Requests for Proposal (RFP)-driven decisions are increasingly rare.
|
|
● |
The alignment of SAP to enterprises is extremely strong. Given the reliance of enterprises on applications, clients tend to make long-term bets on SAP as an enterprise solution.
|
● |
According to the September 2014 “HfS Blueprint Report” from by HfS Research Ltd., the SAP market is a multi-billion-dollar market that is very fragmented (there are over 5,000 consulting firms), with the three largest service providers capturing an increasing share of the market.
|
● |
A significant number of SAP customers must move to S/4 HANA by 2025
).
|
· |
well-developed recruiting, training and retention model;
|
· |
successful service delivery model;
|
· |
broad referral base;
|
· |
continual investment in process improvement and knowledge capture;
|
· |
investment in research and development;
|
· |
strong corporate governance; and
|
· |
custom strategic partnerships to provide breadth and depth of services.
|
(a) |
576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price of our common stock on the closing date of the acquisition;
|
(b) |
Unsecured promissory notes issued to certain of Ameri California’s selling stockholders for the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);
|
(c) |
Earn-out payments in shares of our common stock (up to an aggregate value of $1,200,000 worth of shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and earnings before interest taxes, depreciation and amortization (“EBITDA”) targets as specified in the purchase agreement. We estimate those targets will be fully achieved; and
|
(d) |
An additional cash payment of $55,687 for cash that was left in Ameri California at closing.
|
(a) |
A cash payment in the amount of $3,000,000 at closing;
|
(b) |
1,600,000 shares of our common stock (valued at approximately $10.4 million based on the $6.51 closing price of our common stock on the closing date of the acquisition), which are to be issued on July 29, 2018 or upon a change of control of our company (whichever occurs earlier); and
|
(c) |
Earn-out payments of $1,500,000 payable in cash each year to be paid, if earned, through the achievement of annual revenue and gross margin targets in 2017 and 2018.
|
(a) |
A cash payment in the amount of $675,000 which was due within 90 days of closing and was paid on October 21, 2016;
|
(b) |
101,250 shares of our common stock at closing, valued at approximately $700,000 based on the $6.51 closing price of our common stock on the closing date of the acquisition; and
|
(c) |
Earn-out payments in cash and stock of $450,000 and approximately $560,807, respectively, to be paid, if earned, through the achievement of annual revenue and gross margin targets in 2017, 2018 and 2019. Out of the total contingent consideration of approximately $1,000,000, we only considered 50% of the earn-out in the purchase price, mainly due to the reorganization of Virtuoso.
|
(a) |
A cash payment in the amount of $340,000 which was due within 90 days of closing and was paid on September 22, 2016;
|
(b) |
Warrants for the purchase of 51,000 shares of our common stock (valued at approximately $250,000 based on the $6.51 closing price of our common stock on the closing date of the acquisition), with such warrants exercisable for two years; and
|
(c) |
$255,000, which may become payable in cash earn-outs to the sellers of Bigtech, if Bigtech achieves certain pre-determined revenue and EBITDA targets in 2017 and 2018. We estimate the earn-out payments to be earned at 100% of the targets set forth in the purchase agreement.
|
(a) |
A cash payment in the amount of $3,000,000, which was paid at closing;
|
(b) |
235,295 shares of our common stock issued at closing, valued at approximately $1,000,000 based on the closing price of our common stock on the closing date of the acquisition;
|
(c) |
$250,000 quarterly cash payments to be paid on the last day of each calendar quarter of 2016;
|
(d) |
A $1,000,000 cash reimbursement to be paid 5 days following closing to compensate Ameri Georgia for a portion of its approximate cash balance as of September 1, 2015;
|
(e) |
Approximately $2,910,817 paid within 30 days of closing in connection with the excess of Ameri Georgia’s accounts receivable over its accounts payable as of September 1, 2015; and
|
(f) |
Earn-out payments of approximately $500,000 a year for 2016 and 2017, if earned through the achievement of annual revenue and EBITDA targets specified in the purchase agreement, subject to downward or upward adjustment depending on actual results.
|
· |
establishing and maintaining broad market acceptance of our solutions and services and converting that acceptance into direct and indirect sources of revenue;
|
· |
establishing and maintaining adoption of our technology solutions in a wide variety of industries and on multiple enterprise architectures;
|
· |
timely and successfully developing new solutions and services and increasing the functionality and features of existing solutions and services;
|
· |
developing solutions and services that result in high degree of enterprise client satisfaction and high levels of end-customer usage;
|
· |
successfully responding to competition, including competition from emerging technologies and solutions;
|
· |
developing and maintaining strategic relationships to enhance the distribution, features, content and utility of our solutions and services; and
|
· |
identifying, attracting and retaining talented personnel at reasonable market compensation rates in the markets in which we employ.
|
· |
financial difficulties for a client;
|
· |
a change in strategic priorities, resulting in a reduced level of technology spending;
|
· |
a demand for price reductions; or an unwillingness to accept higher pricing due to various factors such as higher wage costs, higher cost of doing business;
|
· |
a change in outsourcing strategy by moving more work to the client’s in-house technology departments or to our competitors;
|
· |
the replacement by our clients of existing software with packaged software supported by licensors;
|
· |
mergers and acquisitions;
|
· |
consolidation of technology spending by a client, whether arising out of mergers and acquisitions, or otherwise; and
|
· |
sudden ramp-downs in projects due to an uncertain economic environment.
|
· |
make it difficult for us to obtain financing in the future for acquisitions, working capital, capital expenditures, debt service requirements or other purposes;
|
· |
limit our flexibility in planning for or reacting to changes in our business;
|
· |
limit our ability to pay dividends;
|
· |
make us more vulnerable in the event of a downturn in our business; and
|
· |
affect certain financial covenants with which we must comply in connection with our credit facilities.
|
· |
increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic and industry conditions;
|
· |
requiring the dedication of a substantial portion of our cash flow from operations to the payment of principal of, and interest on, our indebtedness, thereby reducing the availability of such cash flow to fund working capital, capital expenditures, acquisitions, joint ventures or other general corporate purposes;
|
· |
limiting our flexibility in planning for, or reacting to, changes in our business, the competitive environment and the industry in which we operate;
|
· |
placing us at a competitive disadvantage as compared to our competitors that are not as highly leveraged; and
|
· |
limiting our ability to borrow additional funds and increasing the cost of any such borrowing.
|
(a) |
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 2.00%;
|
(b) |
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 3.75%; and
|
(c) |
in the case of other obligations under the Credit Facility, a rate per annum equal to the sum of (i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
|
· |
technological innovations or new products and services by us or our competitors;
|
· |
additions or departures of key personnel;
|
· |
sales of our common stock, including management shares;
|
· |
limited availability of freely-tradable “unrestricted” shares of our common stock to satisfy purchase orders and demand;
|
· |
our ability to execute our business plan;
|
· |
operating results that fall below expectations;
|
· |
loss of any strategic relationship;
|
· |
industry developments;
|
· |
economic and other external factors;
|
· |
our ability to manage the costs of maintaining adequate internal financial controls and procedures in connection with the acquisition of additional businesses; and
|
· |
period-to-period fluctuations in our financial results.
|
· |
are not required to obtain an attestation and report from our auditors on our management’s assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002;
|
· |
are not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing how those elements fit with our principles and objectives (commonly referred to as “compensation discussion and analysis”);
|
· |
are not required to obtain a non-binding advisory vote from our stockholders on executive compensation or golden parachute arrangements (commonly referred to as the “say-on-pay,” “say-on-frequency” and “say-on-golden-parachute” votes);
|
· |
are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and CEO pay ratio disclosure;
|
· |
may present only two years of audited financial statements and only two years of related Management’s Discussion & Analysis of Financial Condition and Results of Operations (“MD&A”); and
|
· |
are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under §107 of the JOBS Act.
|
· |
no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
|
· |
the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of the board of directors or the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;
|
· |
the ability of our board of directors to determine whether to issue shares of our preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
|
· |
limiting the liability of, and providing indemnification to, our directors and officers;
|
· |
controlling the procedures for the conduct and scheduling of stockholder meetings; and
|
· |
advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the Company.
|
PART II
|
Twelve months ended December 31, 2016 and December 31, 2017
|
High
|
Low
|
||||||
Quarter ended March 31, 2016
|
$
|
7.00
|
$
|
5.00
|
||||
Quarter ended June 30, 2016
|
$
|
7.00
|
$
|
5.50
|
||||
Quarter ended September 30, 2016
|
$
|
7.00
|
$
|
5.00
|
||||
Quarter ended December 31, 2016
|
$
|
7.50
|
$
|
5.00
|
||||
Quarter ended March 31, 2017
|
$
|
6.55
|
$
|
6.51
|
||||
Quarter ended June 30, 2017
|
$
|
9.00
|
$
|
6.51
|
||||
Quarter ended September 30, 2017
|
$
|
9.00
|
$
|
6.50
|
||||
Quarter ended December 31, 2017
|
$
|
8.70
|
$
|
1.39
|
· |
Our ability to enter into additional technology-management and consulting agreements, to diversify our client base and to expand the geographic areas we serve;
|
· |
Our ability to attract competent, skilled professionals and on-demand technology partners for our operations at acceptable prices to manage our overhead;
|
· |
Our ability to acquire other technology services companies and integrate them with our existing business;
|
· |
Our ability to raise additional equity capital, if and when we needed;
|
· |
We may incur an impairment of the goodwill acquired from our prior business acquisitions if our acquired entities do not experience growth; and
|
· |
Our ability to control our costs of operation as we expand our organization and capabilities.
|
Twelve Months
Ended December 31,
|
||||||||
2017
|
2016
|
|||||||
Net revenue
|
$
|
48,593,712
|
$
|
36,145,589
|
||||
Cost of revenue
|
38,355,967
|
29,217,186
|
||||||
Gross profit
|
10,237,745
|
6,928,403
|
||||||
Operating expenses:
|
||||||||
Selling, general and administration
|
18,510,120
|
9,361,961
|
||||||
Acquisition related expenses
|
481,123
|
1,585,136
|
||||||
Depreciation and amortization
|
3,217,191
|
1,361,169
|
||||||
Operating expenses
|
22,208,434
|
12,308,266
|
||||||
Operating (loss):
|
(11,970,689
|
)
|
(5,379,863
|
)
|
||||
Interest expense
|
(575,039
|
)
|
(751,074
|
)
|
||||
Other income
|
4,995
|
16,604
|
||||||
Change due to estimates
|
1,074,158
|
(410,817
|
)
|
|||||
Total other income /(expenses)
|
504,114
|
(1,145,287
|
)
|
|||||
(Loss) before income taxes
|
(11,466,575
|
)
|
(6,525,150
|
)
|
||||
Income tax benefit
|
2,391,762
|
3,747,846
|
||||||
Net (loss)
|
(9,074,813
|
)
|
(2,777,304
|
)
|
||||
Non-controlling interest
|
-
|
(3,382
|
)
|
|||||
Net (loss) attributable to the Company
|
(9,570,632
|
)
|
(2,780,686
|
)
|
||||
Dividend on preferred stock
|
(2,089,151
|
)
|
-
|
|||||
Net (loss) attributable to common stock holders
|
(11,163,964
|
)
|
(2,780,686
|
)
|
||||
Other comprehensive income/ (loss), net of tax:
|
||||||||
Foreign exchange translation adjustment
|
44,301
|
(7,426
|
)
|
|||||
Total comprehensive (loss)
|
$
|
(11,119,663
|
)
|
(2,788,112
|
)
|
|||
Comprehensive (loss) attributable to the Company
|
(11,119,663
|
)
|
(2,784,730
|
)
|
||||
Comprehensive (loss) attributable to the non-controlling interest
|
-
|
(3,382
|
)
|
|||||
(11,119,663
|
)
|
(2,788,112
|
)
|
|||||
Basic (loss) per share
|
$
|
(0.75
|
)
|
$
|
(0.21
|
)
|
||
Diluted (loss) per share
|
$
|
(0.75
|
)
|
$
|
(0.21
|
)
|
||
Basic weighted average number of shares
|
14,982,791
|
13,068,597
|
||||||
Diluted weighted average number of shares
|
14,982,791
|
13,068,597
|
Year Ended
December 31, 2017
|
Year Ended
December 31, 2016
|
Increase (Decrease)
|
|||||
Ameri and Partners / Ameri Georgia
|
25.80
|
28.48
|
(2.68)
|
||||
Ameri Arizona
|
13.35
|
7.65
|
5.70
|
||||
Ameri California
|
9.43
|
-
|
9.43
|
||||
Total
|
48.59
|
36.15
|
12.45
|
Year ending December 31,
|
Amount
|
|||
2018
|
2,825,148
|
|||
2019
|
2,457,806
|
|||
2020
|
2,326,000
|
|||
2021
|
1,510,749
|
|||
2022
|
350,000
|
|||
Total
|
$
|
9,469,703
|
(a) |
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 2.00%;
|
(b) |
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 3.75%; and
|
(c) |
in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
|
Payments due by period
|
||||||||||||||||
Total
|
Less than
1 year
|
1-3 years
|
3+ years
|
|||||||||||||
Long-term debt obligations
|
$
|
1,880,114
|
$
|
749,551
|
$
|
1,130,563
|
$
|
-
|
||||||||
Operating lease obligations
|
268,992
|
123,873
|
145,119
|
-
|
||||||||||||
Total
|
$
|
2,149,106
|
$
|
873,424
|
$
|
1,275,682
|
$
|
-
|
PART III
|
PART IV
|
Exhibit
|
Description
|
|
Underwriting Agreement dated November 17, 2017 between Ameri Holdings, Inc. and Northland Securities, Inc. (filed as Exhibit 1.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on November 17, 2017 and incorporated herein by reference).
|
||
Share Purchase Agreement, dated as of November 20, 2015, by and among Ameri Holdings, Inc., Bellsoft, Inc., and all of the shareholders of Bellsoft (filed as Exhibit 2.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on November 23, 2015 and incorporated herein by reference).
|
||
Agreement of Merger and Plan of Reorganization, dated as of July 22, 2016, by and among Ameri Holdings, Inc., Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso, L.L.C. and the sole member of Virtuoso, L.L.C. (filed as Exhibit 2.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on July 27, 2016 and incorporated herein by reference).
|
||
Membership Interest Purchase Agreement, dated as of July 29, 2016, by and among Ameri Holdings, Inc., DC&M Partners, L.L.C., all of the members of DC&M Partners, L.L.C., Giri Devanur and Srinidhi “Dev” Devanur (filed as Exhibit 2.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on August 1, 2016 and incorporated herein by reference).
|
||
Share Purchase Agreement, dated as of March 10, 2017, by and among Ameri Holdings, Inc., ATCG Technology Solutions, Inc., all of the stockholders of ATCG Technology Solutions, Inc., and the stockholders’ representative (filed as Exhibit 2.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on March 13, 2017 and incorporated herein by reference).
|
||
Amended and Restated Certificate of Incorporation of Ameri Holdings, Inc. (filed as Exhibit 3.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 23, 2016 and incorporated herein by reference).
|
||
Certificate of Designation of Rights and Preferences of 9.00% Series A Cumulative Preferred Stock (filed as Exhibit 3.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on January 4, 2017 and incorporated herein by reference).
|
||
Corrected Certificate of Designation of Rights and Preferences of 9.00% Series A Cumulative Preferred Stock (filed as Exhibit 3.3 to Ameri Holdings, Inc.’s Registration Statement on Form S-1, Amendment No. 1, filed with the SEC on April 18, 2017 and incorporated herein by reference).
|
||
Amended and Restated Bylaws of Ameri Holdings, Inc. (filed as Exhibit 3.2 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 23, 2016 and incorporated herein by reference).
|
||
Warrant Agent Agreement dated November 17, 2017 between Ameri Holdings, Inc. and Corporate Stock Transfer, Inc. (includes form of Warrant) (filed as Exhibit 4.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on November 17, 2017 and incorporated herein by reference).
|
||
Form of Certificate Representing Shares of Common Stock of Registrant (filed as Exhibit 4.1 to Ameri Holdings, Inc.’s Registration Statement on Form S-8 filed with the SEC on December 17, 2015 and incorporated herein by reference).
|
||
Form of Common Stock Purchase Warrant issued by Ameri Holdings, Inc. to Lone Star Value Investors, LP, dated May 26, 2015 (filed as Exhibit 4.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
Common Stock Purchase Warrant, dated May 12, 2016, issued by Ameri Holdings, Inc. to Lone Star Value Investors, LP, dated May 12, 2016 (filed as Exhibit 4.3 to Ameri Holdings, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016 and incorporated herein by reference).
|
||
Amended and Restated Registration Rights Agreement, dated May 12, 2016, by and between Ameri Holdings, Inc. and Lone Star Value Investors, LP (filed as Exhibit 10.3 to Ameri Holdings, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016 and incorporated herein by reference).
|
||
Form of 8% Convertible Unsecured Promissory Note due March 2020 (filed as Exhibit 10.2 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).
|
||
Form of Registration Rights Agreement for 2017 Notes Investors (filed as Exhibit 10.3 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).
|
||
Form of 6% Unsecured Promissory Note (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on March 13, 2017 and incorporated herein by reference).
|
||
Securities Purchase Agreement, dated as of May 26, 2015, by and between Ameri Holdings, Inc. and Lone Star Value Investors, LP. (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
||
Employment Agreement, dated as of May 26, 2015, between Giri Devanur and Ameri Holdings, Inc. (filed as Exhibit 10.4 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
||
Employment Agreement, dated as of May 26, 2015, between Srinidhi “Dev” Devanur and Ameri Holdings, Inc. (filed as Exhibit 10.5 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
||
Form of Indemnification Agreement. (filed as Exhibit 10.6 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
||
Form of Option Grant Letter. (filed as Exhibit 10.7 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
||
2015 Equity Incentive Award Plan. (filed as Exhibit 10.8 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
|
||
Form of Restricted Stock Unit Agreement (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Quarterly Report on Form 10-Q filed with the SEC on November 23, 2015 and incorporated herein by reference).
|
||
Securities Purchase Agreement, dated as of April 20, 2016, by and between Ameri Holdings, Inc. and Dhruwa N. Rai (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on April 21, 2016 and incorporated herein by reference).
|
||
Loan and Security Agreement, dated as of July 1, 2016, by and among Ameri and Partners Inc
.,
Bellsoft, Inc., Ameri Holdings, Inc., Linear Logics, Corp., Winhire Inc
.,
Giri Devanur, the lenders which become a party to the Loan and Security Agreement, and Sterling National Bank, N.A. (a lender and as agent for the lenders) (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on July 7, 2016 and incorporated herein by reference).
|
||
Exchange Agreement, dated as of December 30, 2016, between Ameri Holdings, Inc. and Lone Star Value Investors, LP (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on January 4, 2017 and incorporated herein by reference).
|
||
Form of Securities Purchase Agreement for 2017 Notes Investors (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).
|
Employment Letter, dated April 24, 2016, between Ameri and Partners Inc and Viraj Patel (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on April 25, 2017 and incorporated herein by reference).
|
||
Consent, Waiver and Amendment No. 7 to Loan and Security Agreement, dated as of August 22, 2017, by and among Ameri Holdings, Inc., certain subsidiaries of Ameri Holdings, Inc., Giri Devanur and Sterling National Bank (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on August 28, 2017 and incorporated herein by reference).
|
||
Amendment to 6% Unsecured Promissory Note and Waiver Agreement, dated February 28, 2018, by and between Ameri Holdings, Inc. and Moneta Ventures Fund I, L.P. (filed as Exhibit 10.1 to Ameri Holdings, Inc.’s Current Report on Form 8-K filed with the SEC on March 2, 2018 and incorporated herein by reference).
|
||
List of Subsidiaries.
|
||
Consent of Ram Associates, CPA.
|
||
Section 302 Certification of Principal Executive Officer
|
||
Section 302 Certification of Principal Financial and Accounting Officer
|
||
Section 906 Certification of Principal Executive Officer
|
||
Section 906 Certification of Principal Financial and Accounting Officer
|
||
101*
|
The following materials from Ameri Holdings, Inc.’s Annual Report on Form 10-K for the twelve months ended December 31, 2017 are formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statement of Stockholders’ Equity (Deficit), (iv) the Consolidated Statements of Cash Flow, and (iv) Notes to the Consolidated Financial Statements.
|
* |
Filed herewith.
|
** |
In accordance with Item 601of Regulation S-K, this Exhibit is hereby furnished to the SEC as an accompanying document and is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933.
|
PAGE
|
|
AUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF AMERI HOLDINGS, INC. AS OF DECEMBER 31, 2017 AND 2016 AND FOR THE YEARS THEN ENDED
|
|
F-2
|
|
F-3
|
|
F-4
|
|
F-5
|
|
F-6
|
|
F-7
|
December 31,
2017
|
December 31,
2016
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
4,882,084
|
$
|
1,379,887
|
||||
Accounts receivable
|
8,838,453
|
8,059,910
|
||||||
Other current assets
|
924,266
|
625,145
|
||||||
Total current assets
|
14,644,803
|
10,064,942
|
||||||
Other assets:
|
||||||||
Property and equipment, net
|
95,048
|
100,241
|
||||||
Intangible assets, net
|
9,469,703
|
8,764,704
|
||||||
Acquired goodwill
|
21,898,323
|
17,089,076
|
||||||
Deferred income tax assets, net
|
6,088,751
|
3,488,960
|
||||||
Total other assets
|
37,551,825
|
29,442,981
|
||||||
Total assets
|
$
|
52,196,628
|
$
|
39,507,923
|
||||
Current liabilities:
|
||||||||
Line of credit
|
4,053,318
|
3,088,890
|
||||||
Accounts payable
|
5,324,872
|
5,130,817
|
||||||
Other accrued expenses
|
2,582,661
|
2,165,088
|
||||||
Current portion - long term notes
|
749,551
|
405,376
|
||||||
Consideration payable
–
cash
|
5,509,427
|
1,854,397
|
||||||
Consideration payable - equity
|
12,148,053
|
64,384
|
||||||
Total current liabilities
|
30,367,882
|
12,708,952
|
||||||
Long term liabilities:
|
||||||||
Convertible notes
|
1,250,000
|
-
|
||||||
Long-term notes – net of current portion
|
1,130,563
|
1,536,191
|
||||||
Long-term consideration payable - cash
|
-
|
2,711,717
|
||||||
Long-term consideration payable - equity
|
-
|
10,887,360
|
||||||
Total long-term liabilities
|
2,380,563
|
15,135,268
|
||||||
Total liabilities
|
32,748,
445
|
27,844,220
|
||||||
Stockholders’ equity:
|
||||||||
Preferred stock, $0.01 par value; 1,000,000 authorized, 405,395 and 363,611 issued and outstanding as of December 31, 2017, and December 31, 2016, respectively
|
4,054
|
3,636
|
||||||
Common stock, $0.01 par value; 100,000,000 shares authorized, 18,162,723 and 13,885,972 issued and outstanding as of December 31, 2017, and December 31, 2016, respectively
|
181,625
|
138,860
|
||||||
Additional paid-in capital
|
34,223,181
|
15,358,839
|
||||||
Accumulated deficit
|
(14,997,552
|
)
|
(3,833,588
|
)
|
||||
Accumulated other comprehensive income (loss)
|
36,875
|
(7,426
|
)
|
|||||
Non-Controlling Interest
|
-
|
3,382
|
||||||
Total stockholders’ equity
|
19,448,183
|
11,663,703
|
||||||
Total liabilities and stockholders’ equity
|
$
|
52,196,628
|
$
|
39,507,923
|
Twelve Months
Ended
December 31,
|
||||||||
2017
|
2016
|
|||||||
Net revenue
|
$
|
48,593,712
|
$
|
36,145,589
|
||||
Cost of revenue
|
38,355,967
|
29,217,186
|
||||||
Gross profit
|
10,237,745
|
6,928,403
|
||||||
Operating expenses:
|
||||||||
Selling, general and administration
|
18,510,120
|
9,361,961
|
||||||
Acquisition related expenses
|
481,123
|
1,585,136
|
||||||
Depreciation and amortization
|
3,217,191
|
1,361,169
|
||||||
Operating expenses
|
22,208,434
|
12,308,266
|
||||||
Operating (loss):
|
(11,970,689
|
)
|
(5,379,863
|
)
|
||||
Interest expense
|
(575,039
|
)
|
(751,074
|
)
|
||||
Other income
|
4,995
|
16,604
|
||||||
Change due to estimates
|
1,074,158
|
(410,817
|
)
|
|||||
Total other income /(expenses)
|
504,114
|
(1,145,287
|
)
|
|||||
(Loss) before income taxes
|
(11,466,575
|
)
|
(6,525,150
|
)
|
||||
Income tax benefit
|
2,391,762
|
3,747,846
|
||||||
Net (loss)
|
(9,074,813
|
)
|
(2,777,304
|
)
|
||||
Non-controlling interest
|
-
|
(3,382
|
)
|
|||||
Net (loss) attributable to the company
|
(9,074,813
|
)
|
(2,780,686
|
)
|
||||
Dividend on preferred stock
|
(2,089,151
|
)
|
-
|
|||||
Net (loss) attributable to common stock holders
|
(11,163,964
|
)
|
(2,780,686
|
)
|
||||
Other comprehensive income/ (loss), net of tax:
|
||||||||
Foreign exchange translation adjustment
|
44,301
|
(7,426
|
)
|
|||||
Total comprehensive (loss)
|
$
|
(11,119,663
|
)
|
(2,788,112
|
)
|
|||
Comprehensive (loss) attributable to the Company
|
(11,119,663
|
)
|
(2,784,730
|
)
|
||||
Comprehensive (loss) attributable to the non-controlling interest
|
-
|
(3,382
|
)
|
|||||
(11,119,663
|
)
|
(2,788,112
|
)
|
|||||
Basic (loss) per share
|
$
|
(0.75
|
)
|
$
|
(0.21
|
)
|
||
Diluted (loss) per share
|
$
|
(0.75
|
)
|
$
|
(0.21
|
)
|
||
Basic weighted average number of shares
|
14,982,791
|
13,068,597
|
||||||
Diluted weighted average number of shares
|
14,982,791
|
13,068,597
|
Common Stock
|
Preferred Stock
|
|||||||||||||||||||||||||||||||||||
Shares
|
Par
Value
at $0.01
|
Shares
|
Par
Value
at
$0.01
|
Additional
Paid-in
Capital
|
Foreign
Currency
Translation
Reserve
|
Retained
Earnings
|
Non-
Controlling
Interests
|
Total
stockholders’
Equity
|
||||||||||||||||||||||||||||
Balance at December 31, 2015
|
11,874,361
|
$
|
118,743
|
$ |
$
|
1,192,692
|
$
|
-
|
$
|
(1,052,902
|
)
|
$ |
$
|
258,533
|
||||||||||||||||||||||
Common stock issued
|
500,000
|
5,000
|
2,995,000
|
3,000,000
|
||||||||||||||||||||||||||||||||
Conversion of notes into preferred shares
|
363,611
|
3,636
|
5,121,364
|
5,125,000
|
||||||||||||||||||||||||||||||||
Conversion of warrants into common shares
|
1,111,111
|
11,111
|
1,988,889
|
2,000,000
|
||||||||||||||||||||||||||||||||
Issuance of shares for acquisition
|
400,500
|
4,006
|
2,603,247
|
2,607,253
|
||||||||||||||||||||||||||||||||
Stock options and RSU expense
|
1,457,647
|
1,457,647
|
||||||||||||||||||||||||||||||||||
Non-controlling interests
|
3,382
|
3,382
|
||||||||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss)
|
(7,426
|
)
|
(7,426
|
)
|
||||||||||||||||||||||||||||||||
Net (loss)
|
(2,780,686
|
)
|
(2,780,686
|
)
|
||||||||||||||||||||||||||||||||
Balance at December 31, 2016
|
13,885,972
|
$
|
138,860
|
363,611
|
$
|
3,636
|
$
|
15,358,839
|
$
|
(7,426
|
)
|
$
|
(3,833,588
|
)
|
$
|
3,382
|
$
|
11,663,703
|
||||||||||||||||||
Shares issued against services
|
33,333
|
333
|
216,665
|
216,998
|
||||||||||||||||||||||||||||||||
Shares issued as acquisition consideration (ATCG)
|
576,923
|
5,769
|
3,773,077
|
3,778,846
|
||||||||||||||||||||||||||||||||
Stock options and RSU expense
|
4,275,855
|
4,275,855
|
||||||||||||||||||||||||||||||||||
Exercise and acceleration of RSU’s
|
446,509
|
4,464
|
(4,464
|
)
|
-
|
|||||||||||||||||||||||||||||||
Bonus shares issued to employees and Directors
|
198,600
|
1,986
|
512,888
|
514,874
|
||||||||||||||||||||||||||||||||
Shares Issued towards earn-outs
|
340,549
|
3,405
|
955,611
|
959,016
|
||||||||||||||||||||||||||||||||
Cashless exercise of warrants
|
1,205,837
|
12,058
|
2,158,448
|
2,170,506
|
||||||||||||||||||||||||||||||||
Public offering of shares
|
1,475,000
|
14,750
|
4,868,532
|
4,883,282
|
||||||||||||||||||||||||||||||||
Public offering of warrants
|
15,618
|
15,618
|
||||||||||||||||||||||||||||||||||
Shares issued against preference dividend
|
41,784
|
418
|
2,088,730
|
2,089,148
|
||||||||||||||||||||||||||||||||
Non-controlling interest
|
3,382
|
(3,382
|
)
|
-
|
||||||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss)
|
44,301
|
44,301
|
||||||||||||||||||||||||||||||||||
Net (loss)
|
(11,163,964
|
)
|
-
|
(11,163,964
|
)
|
|||||||||||||||||||||||||||||||
Balance at Dec 31, 2017
|
18,162,723
|
$
|
181,625
|
405,395
|
$
|
4,054
|
$
|
34,223,181
|
$
|
36,875
|
$
|
(
14,997,552
|
)
|
$
|
-
|
$
|
19,448,183
|
December 31,
|
||||||||
2017
|
2016
|
|||||||
Cash flow from operating activities
|
||||||||
Comprehensive (loss)
|
(11,163,964
|
)
|
(2,780,686
|
)
|
||||
Adjustment to reconcile comprehensive (loss) to net cash used in operating activities
|
||||||||
Depreciation and amortization
|
3,217,191
|
1,361,169
|
||||||
Preferred dividend
|
2,089,151
|
-
|
||||||
Changes in estimate of contingent consideration
|
(1,074,158
|
)
|
410,817
|
|||||
Equity compensation expense
|
7,078,230
|
1,457,647
|
||||||
Foreign exchange translation adjustment
|
44,
301
|
(7,426
|
)
|
|||||
Deferred income tax
|
(2,391,762
|
)
|
(3,488,960
|
)
|
||||
Changes in assets and liabilities:
|
||||||||
Increase (decrease) in:
|
||||||||
Accounts receivable
|
(778,543
|
)
|
(3,187,828
|
)
|
||||
Other current assets
|
(382,029
|
)
|
(198,428
|
)
|
||||
Increase (decrease) in:
|
||||||||
Accounts payable and accrued expenses
|
620,788
|
3,729,706
|
||||||
Net cash used in operating activities
|
(2,740,794
|
)
|
(2,703,989
|
)
|
||||
Cash flow from investing activities
|
||||||||
Purchase of fixed assets
|
(4,840
|
)
|
(29,062
|
)
|
||||
Acquisition consideration
|
(804,044
|
)
|
(6,563,000
|
)
|
||||
Net cash used in investing activities
|
(808,884
|
)
|
(6,592,062
|
)
|
||||
Cash flow from financing activities
|
||||||||
Proceeds from bank loan and convertible notes, net
|
2,152,975
|
3,794,522
|
||||||
Non-controlling interest
|
-
|
3,382
|
||||||
Proceeds from additional stock issued, net
|
4,898,900
|
5,000,000
|
||||||
Net cash provided by financing activities
|
7,051,875
|
8,797,904
|
||||||
Net increase (decrease) in cash and cash equivalents
|
3,502,197
|
(498,147
|
)
|
|||||
Cash and cash equivalents as at beginning of the period
|
1,379,887
|
1,878,034
|
||||||
Cash at the end of the period
|
4,882,084
|
1,379,887
|
SUPPLEMENTAL DISCLOSURES:
|
||||||||
Cash paid during the period for:
|
||||||||
Interest
|
$
|
450,920
|
$
|
362,792
|
||||
Taxes
|
$
|
-
|
$
|
-
|
NOTE 1. |
ORGANIZATION:
|
NOTE 2. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
|
NOTE 3. |
SHARE CAPITAL:
|
NOTE 4. |
BUSINESS COMBINATIONS:
|
(a) |
A cash payment in the amount of $3 million, which was paid at closing;
|
(b) |
235,295 shares of our common stock issued at closing, valued at approximately $1million based on the closing price of our common stock on the closing date of the acquisition;
|
(c) |
$0.25 million quarterly cash payments to be paid on the last day of each calendar quarter of 2016;
|
(d) |
A $1 million cash reimbursement to be paid 5 days following closing to compensate Ameri Georgia for a portion of its approximate cash balance as of September 1, 2015;
|
(e) |
Approximately $2.9 million paid within 30 days of closing in connection with the excess of Ameri Georgia’s accounts receivable over its accounts payable as of September 1, 2015; and
|
(f) |
Earn-out payments of approximately $0.5 million a year for 2016 and 2017, if earned through the achievement of annual revenue and earnings before interest, taxes, depreciation and amortization (“EBITDA”) targets specified in the purchase agreement, subject to downward or upward adjustment depending on actual results. We estimate the earn-out payments to be earned at 100% of the targets set forth in the purchase agreement.
|
(a) |
A cash payment in the amount of $0.3 million which was due within 90 days of closing and was paid on September 22, 2016;
|
(b) |
Warrants for the purchase of 51,000 shares of our common stock (valued at approximately $0.25 million based on the $6.51 closing price of our common stock on the closing date of the acquisition), with such warrants exercisable for two years; and
|
(c) |
$0.25 million, which may become payable in cash earn-outs to the sellers of Bigtech, if Bigtech achieves certain pre-determined revenue and EBITDA targets in 2017 and 2018. We estimate the earn-out payments to be earned at 100% of the targets set forth in the purchase agreement.
|
(a) |
A cash payment in the amount of $0.68 million which was due within 90 days of closing and was paid on October 21, 2016;
|
(b) |
101,250 shares of our common stock at closing, valued at approximately $0.7 million based on the $6.51 closing price of our common stock on the closing date of the acquisition; and
|
(c) |
Earn-out payments in cash and stock of $0.5 million and approximately $0.6, respectively, to be paid, if earned, through the achievement of annual revenue and gross margin targets in 2017, 2018 and 2019. Out of the total contingent consideration of approximately $1million, we only considered 50% of the earn-out in the purchase price, mainly due to the reorganization of Virtuoso. The Virtuoso earn-out payments for 2017 amounted to $0.06 million in cash and 12,408 shares of common stock as compared to the potential earn-out of $0.2 million under the terms of the purchase agreement.
|
(a) |
A cash payment in the amount of $3 million at closing;
|
(b) |
1,600,000 shares of our common stock (valued at approximately $10.4 million based on the $6.51 closing price of our common stock on the closing date of the acquisition), which are to be issued on July 29, 2018 or upon a change of control of our company (whichever occurs earlier); and
|
(c) |
Earn-out payments of $1.5 million payable in cash each year to be paid, if earned, through the achievement of annual revenue and gross margin targets in 2017 and 2018.
|
(a) |
576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price of our common stock on the closing date of the acquisition;
|
(b) |
Unsecured promissory notes issued to certain of Ameri California’s selling stockholders for the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);
|
(c) |
Earn-out payments in shares of our common stock (up to an aggregate value of $1.2 million worth of shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and earnings before interest taxes, depreciation and amortization (“EBITDA”) targets as specified in the purchase agreement. We estimate those targets will be fully achieved; and
|
(d) |
An additional cash payment of $0.06 million for cash that was left in Ameri California at closing.
|
Allocation of purchase price in millions of U.S. dollars
|
||||||||||||||||||||
Asset Component
|
Ameri
Georgia
|
Bigtech
|
Virtuoso
|
Ameri
Arizona
|
Ameri
California
|
|||||||||||||||
Intangible Assets
|
1.8
|
0.6
|
0.9
|
5.4
|
3.8
|
|||||||||||||||
Goodwill
|
3.5
|
0.3
|
0.9
|
10.4
|
5.0
|
|||||||||||||||
Working Capital
|
||||||||||||||||||||
Current Assets
|
||||||||||||||||||||
Cash
|
1.4
|
-
|
-
|
-
|
-
|
|||||||||||||||
Accounts Receivable
|
5.6
|
-
|
-
|
-
|
-
|
|||||||||||||||
Other Assets
|
0.2
|
-
|
-
|
-
|
-
|
|||||||||||||||
7.3
|
-
|
-
|
-
|
-
|
||||||||||||||||
Current Liabilities
|
||||||||||||||||||||
Accounts Payable
|
1.3
|
-
|
-
|
-
|
-
|
|||||||||||||||
Accrued Expenses & Other Current Liabilities
|
1.3
|
-
|
-
|
-
|
-
|
|||||||||||||||
2.7
|
-
|
-
|
-
|
-
|
||||||||||||||||
Net Working Capital Acquired
|
4.6
|
-
|
-
|
-
|
-
|
|||||||||||||||
Total Purchase Price
|
9.9
|
0.9
|
1.8
|
15.8
|
8.8
|
NOTE 5. |
INTANGIBLE ASSETS:
|
2017
|
2016
|
|||||||||||||||||||||||
Gross Carrying
Amount
|
Accumulated
Amortization
|
Net
Carrying
Amount
|
Gross
Carrying
Amount
|
Accumulated
Amortization
|
Net Carrying
Amount
|
|||||||||||||||||||
Customer lists
|
$
|
13,563,
414
|
4,206,811
|
9,356,603
|
13,563,416
|
5,120,604
|
8,442,812
|
|||||||||||||||||
Software
|
$
|
425,064
|
311,964
|
113,100
|
425,880
|
103,988
|
321,892
|
|||||||||||||||||
Total intangible assets:
|
$
|
13,988,
478
|
4,518,775
|
9,469,703
|
13,989,296
|
5,224,592
|
8,764,704
|
Year ending December 31,
|
$
|
Amount
|
||
2018
|
2,825,148
|
|||
2019
|
2,457,806
|
|||
2020
|
2,326,000
|
|||
2021
|
1,510,749
|
|||
2022
|
350,000
|
|||
Total
|
$
|
9,469,703
|
NOTE 6. |
GOODWILL:
|
December 31,
2017
|
December 31,
2016
|
|||||||
Virtuoso
|
$
|
939,881
|
$
|
939,881
|
||||
Ameri Arizona
|
10,416,000
|
10,416,000
|
||||||
Bigtech
|
314,554
|
314,555
|
||||||
Ameri Consulting Service Pvt. Ltd.
|
1,948,118
|
1,948,118
|
||||||
Ameri Georgia
|
3,470,522
|
3,470,522
|
||||||
Ameri California
|
4,809,248
|
-
|
||||||
Total
|
$
|
21,898,323
|
$
|
17,089,076
|
NOTE 7. |
SHARE-BASED COMPENSATION:
|
NOTE 8. |
EQUITY COMPENSATION PLANS:
|
Options
|
RSUs
|
Shares of Stock
|
|||||||||||||||||||||||
No. of
Options
|
Weighted
Average
Price
|
No of
RSUs
|
No of
Shares
|
Weighted
Average
Price
|
Total
|
||||||||||||||||||||
Equity compensation plan total shares
|
-
|
-
|
2,000,000
|
||||||||||||||||||||||
Granted
|
150,000
|
2.67
|
83,189
|
-
|
-
|
233,189
|
|||||||||||||||||||
Cancelled/expired
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||
Balance outstanding as at December 31, 2015
|
150,000
|
2.67
|
83,189
|
-
|
-
|
-
|
|||||||||||||||||||
Balance available under the plan as at December 31, 2015
|
-
|
-
|
-
|
-
|
-
|
1,766,811
|
|||||||||||||||||||
Granted
|
975,700
|
6.79
|
507,680
|
-
|
-
|
1,483,380
|
|||||||||||||||||||
Cancelled/expired
|
(160,000
|
)
|
5.41
|
-
|
-
|
-
|
160,000
|
||||||||||||||||||
Balance outstanding as at December 31, 2016
|
965,700
|
6.38
|
590,869
|
-
|
-
|
||||||||||||||||||||
Balance available under the plan as at December 31, 2016
|
-
|
-
|
-
|
-
|
-
|
443,431
|
|||||||||||||||||||
Granted
|
285,000
|
5.62
|
76,121
|
198,600
|
2.58
|
559,721
|
|||||||||||||||||||
Cancelled/Expired
|
(90,400
|
)
|
6.54
|
(190,827
|
)
|
-
|
-
|
281,227
|
|||||||||||||||||
Balance outstanding as at December 31, 2017
|
1,160,300
|
6.10
|
476,163
|
198,600
|
2.58
|
||||||||||||||||||||
Balance available under the plan as at December 31, 2017
|
-
|
-
|
-
|
-
|
-
|
164,937
|
· |
Expected term of 3.25 years.
|
· |
Expected volatility of 50%.
|
· |
Risk-free interest rate of 0.57%.
|
· |
Expected dividend yield of 0%.
|
NOTE 9. |
WARRANTS:
|
Number of Shares
|
Weighted Average,
Exercise Price
|
Weighted Average,
Remaining term
|
||||||||||
Warrants Outstanding at December 31, 2014
|
-
|
-
|
-
|
|||||||||
Granted
|
2,777,777
|
1.80
|
4.41
|
|||||||||
Exercised
|
-
|
-
|
-
|
|||||||||
Warrants Outstanding at December 31, 2015
|
2,777,777
|
1.80
|
4.41
|
|||||||||
Granted
|
1,000,000
|
6.00
|
-
|
|||||||||
Exercised
|
111,111
|
1.80
|
-
|
|||||||||
Warrants Outstanding at December 31, 2016
|
2,666,666
|
1.80
|
3.90
|
|||||||||
Granted
|
-
|
|||||||||||
Exercised
|
1,666,666
|
1.80
|
||||||||||
Warrants Outstanding at December 31, 2017
|
1,000,000
|
6.00
|
2.36
|
NOTE 10. |
RESTRUCTURING AND STREAMLINING COSTS:
|
NOTE 11. |
EARNINGS / (LOSS) PER SHARE:
|
Twelve Months Ended
December 31,
|
||||||||
2017
|
2016
|
|||||||
(In thousands, except per share data)
|
||||||||
Basic net (loss) per share:
|
||||||||
Net (loss) applicable to common shares
|
$
|
(11,163,964
|
)
|
$
|
(2,780,686
|
)
|
||
Weighted average common shares outstanding
|
14,982,791
|
13,068,597
|
||||||
Basic net (loss) per share of common stock
|
$
|
(0.75
|
)
|
$
|
(0.21
|
)
|
||
Diluted net (loss) per share:
|
||||||||
Net (loss) applicable to common shares
|
$
|
(11,163,964
|
)
|
$
|
(2,780,686
|
)
|
||
Weighted average common shares outstanding
|
14,982,791
|
13,068,597
|
||||||
Dilutive effects of convertible debt, stock options and warrants
|
-
|
-
|
||||||
Weighted average common shares, assuming dilutive effect of stock options
|
14,982,791
|
13,068,597
|
||||||
Diluted net (loss) per share of common stock
|
$
|
(0.75
|
)
|
$
|
(0.21
|
)
|
NOTE 12. |
DEBT:
|
(a) |
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 2.00%;
|
(b) |
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 3.75%; and
|
(c) |
in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
|
2017
|
2016
|
|||||||
Notes outstanding under revolving credit facility
|
$
|
4,053,318
|
$
|
3,088,890
|
||||
Term loan - current maturities
|
749,551
|
405,376
|
||||||
Total short-term debt
|
$
|
4,802,869
|
$
|
3,494,266
|
2017
|
2016
|
|||||||
Term loan, due 2019
|
$
|
1,880,114
|
$
|
1,941,567
|
||||
Less: Current maturities
|
749,551
|
405,376
|
||||||
Long-term debt, net of current maturities
|
$
|
1,130,563
|
$
|
1,536,191
|
Year
|
Amounts
|
|||
2018
|
749,551
|
|||
2019
|
1,130,563
|
|||
Total
|
$
|
1,880,114
|
NOTE 13. |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES:
|
December 31, 2017
|
December 31, 2016
|
|||||||
Salaries, commissions and other benefits payable
|
1,156,601
|
564,244
|
||||||
Professional and legal fees payable
|
329,332
|
507,657
|
||||||
Interest payable
|
262,520
|
-
|
||||||
Taxes Payable
|
446,694
|
525,766
|
||||||
Other liabilities
|
387,514
|
567,421
|
||||||
TOTAL
|
2,
582,661
|
2,165,088
|
NOTE 14. |
EMPLOYEE BENEFIT PLAN:
|
NOTE 15. |
INCOME TAXES:
|
2017
|
2016
|
|||||||
Current:
|
||||||||
Federal and state
|
$
|
63,577
|
$
|
(355,243
|
)
|
|||
Foreign
|
144,452
|
96,357
|
||||||
Total current provision
/(benefit)
|
208,029
|
(258,886
|
)
|
|||||
Deferred:
|
||||||||
Federal and state
|
(
2,599,791
|
)
|
(3,488,960
|
)
|
||||
Foreign
|
-
|
|||||||
Valuation allowance
|
-
|
|||||||
Total deferred benefit
|
(
2,599,791
|
)
|
(3,488,960
|
)
|
||||
Total income
tax benefit
|
$
|
(
2,391,762
|
)
|
$
|
(3,747,846
|
)
|
NOTE 16. |
COMMITMENTS AND CONTINGENCIES:
|
Years ending
December 31,
|
||||
2018
|
123,873
|
|||
2019
|
67,415
|
|||
2020
|
70,333
|
|||
2021
|
7,371
|
|||
Total
|
$
|
268,992
|
NOTE 17. |
FAIR VALUE MEASUREMENT:
|
· |
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
|
· |
Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and
|
· |
Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Cash equivalents:
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
Contingent consideration
|
-
|
-
|
3,374,660
|
3,374,660
|
||||||||||||
Total
|
-
|
-
|
$
|
3,374,660
|
$
|
3,374,660
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Cash equivalents:
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
Contingent consideration
|
-
|
-
|
5,266,488
|
5,266,488
|
||||||||||||
Total
|
-
|
-
|
$
|
5,266,488
|
$
|
5,266,488
|
Opening balance December 31
st
2016
|
5,266,488
|
|||
Additions during the period
|
$
|
1,200,000
|
||
Paid/settlements
|
(2,017,670
|
)
|
||
Total gains recognized in Statement of Operations
|
(1,074,158
|
)
|
||
Closing balance December 31
st
2017
|
$
|
3,374,660
|
NOTE 18. |
SEGMENT INFORMATION
|
AMERI Holdings, Inc.
|
||
By:
|
/s/ Brent Kelton | |
Brent Kelton
|
||
Chief Executive Officer (Principal Executive Officer)
|
||
By:
|
/s/ Viraj Patel | |
Viraj Patel
|
||
Chief Financial Officer (Principal Financial Officer)
|
Signature
|
Title
|
Date
|
||
/s/ Jeffrey E. Eberwein |
Chairman of the Board and Director
|
March 29, 2018
|
||
Jeffrey E. Eberwein
|
||||
/s/ Srinidhi Devanur |
Executive Vice Chairman of the Board and Director
|
March 29, 2018
|
||
Srinidhi Devanur
|
||||
/s/ Brent Kelton |
Chief Executive Officer
|
March 29, 2018
|
||
Brent Kelton
|
||||
/s/ Viraj Patel |
Chief Financial Officer
|
March 29, 2018
|
||
Viraj Patel
|
||||
/s/ Dimitrios J. Angelis |
Director
|
March 29, 2018
|
||
Dimitrios J. Angelis
|
||||
/s/ Dr. Arthur M. Langer |
Director
|
March 29, 2018
|
||
Dr. Arthur M. Langer
|
||||
/s/ Robert G. Pearse |
Director
|
March 29, 2018
|
||
Robert G. Pearse
|
||||
/s/ Venkatraman Balakrishnan |
Director
|
March 29, 2018
|
||
Venkatraman Balakrishnan
|
||||
/s/ David Luci | Director |
March 29, 2018
|
||
David Luci |
1 Year Ameri Chart |
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