Powerfleet, Inc 8-K/A, filed Jun 14, 2024

Powerfleet, Inc. (AIOT)

8-K/A 2024-06-14 For: 2024-04-02

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Added on April 09, 2026

About this 8-K/A

Powerfleet, Inc filed this 8-K/A on June 14, 2024, reporting on events of April 2, 2024.

Items reported

Item 9.01: Financial statements and exhibits

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Delaware		001-39080		83-4366463
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

123 Tice Boulevard, Woodcliff Lake, New Jersey		07677
(Address of Principal Executive Offices)		(Zip Code)

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 per share		PWFL		The Nasdaq Global Market

Exhibit No.		Description
23.1		Consent of Deloitte & Touche, Independent Registered Public Accounting Firm of MiX Telematics.
99.1		Audited Consolidated Financial Statements of Mix Telematics as of March 31, 2022 and 2023 and for the fiscal years ended March 31, 2022 and 2023 (incorporated by reference to Item 8. “Financial Statements and Supplementary Data” in MiX Telematics’ Annual Report on Form 10-K for the year ended March 31, 2023, filed with the SEC on June 22, 2023).
99.2		Unaudited Condensed Consolidated Financial Statements of MiX Telematics as of December 31, 2023 and for the nine months ended December 31, 2023 (incorporated by reference to Item 1. “Financial Statements” in MiX Telematics’ Quarterly Report on Form 10-Q for the quarter ended December 31, 2023, filed with the SEC on February 9, 2024).
99.3		Unaudited pro forma combined financial information of the Company and MiX Telematics as of and for the year ended December 31, 2023.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

	POWERFLEET, INC.

	By:	/s/ David Wilson
	Name:	David Wilson
	Title:	Chief Financial Officer

(In thousands, except per share data)	Powerfleet (Historical)		MiX Telematics (Historical)		Reclassifications (O)			Transaction Accounting Adjustments			Notes	Other Transaction Accounting Adjustments			Notes	Pro Forma Combined
ASSETS
Current assets
Cash and cash equivalents	$	19,022	$	25,419								$	12,396		K	$	56,837
Restricted cash		310		863													1,173
Accounts receivable, net of allowance for doubtful accounts		32,440		28,264													60,704
Inventory, net		22,602		5,137													27,739
Deferred costs - current		83		-													83
Prepaid expenses and other current assets		7,568		9,470													17,038
Total current assets		82,025		69,153									12,396				163,574

Fixed assets, net		12,383		40,865		(3,380	)										49,868
Goodwill		83,487		39,060					162,546		A						285,093
Intangible assets, net		20,075		21,247					138,753		A						180,075
Right of use asset		6,195		-		3,380											9,575
Severance payable fund		3,802		-													3,802
Deferred tax asset		2,863		583													3,446
Other assets		6,916		10,614					(9,353	)	A						8,177
Total assets	$	217,746	$	181,522				$	291,946			$	12,396			$	703,610
LIABILITIES
Current liabilities
Short-term bank debt and current maturities of long-term debt		21,091		21,136									587		J		42,814
Accounts payable and accrued expenses		30,296		-		27,643			10,809		B						68,748
Accounts payables		-		4,897		(4,897	)										-
Accrued expenses and other liabilities		-		23,614		(23,614	)										-
Deferred revenue - current		5,666		6,487													12,153
Lease liability - current		1,503		-		868											2,371
Contingent consideration		-		312													312
Income taxes payable		-		288													288
Total current liabilities		58,556		56,734					10,809				587				126,686
Long-term debt, less current maturities		-		-									102,082		J		102,082
Deferred revenue - less current portion		4,956		-													4,956
Lease liability – less current portion		4,908		-		2,803											7,711
Accrued severance payable		4,533		-													4,533
Deferred tax liability		4,450		13,506					34,938		A						52,894
Other long-term liabilities		2,422		-		462											2,884
Long-term accrued expenses and other liabilities		-		3,265		(3,265	)										-
Total liabilities	$	79,825	$	73,505				$	45,747			$	102,669			$	301,746

Convertible redeemable preferred stock: Series A – 100 shares authorized, $0.01 par value; 60 shares issued and outstanding at December 31, 2023.		80,277		-									(80,277	)	J		-

Total stockholders’ equity of the company		57,542		108,012					246,199		C		(9,996	)	J		401,757
Non-controlling interest		102		5													107
Total equity		57,644		108,017					246,199				(9,996	)			401,864
Total liabilities, convertible redeemable preferred stock and stockholders’ equity	$	217,746	$	181,522				$	291,946			$	12,396			$	703,610

(In thousands, except per share data)	Powerfleet (Historical)			MiX Telematics (Historical)*			Reclassifications (O)			Transaction Accounting Adjustments			Notes	Other Transaction Accounting Adjustments			Notes	Pro Forma Combined
Revenue	$	133,736		$	150,063													$	283,799
Cost of revenues		66,660			57,493						5,221		G						129,374
Gross profit		67,076			92,570						(5,221	)							154,425
Operating expenses		79,633			79,616			-			7,503								166,752
- Selling, general and administrative expenses		71,253			-			73,984			7,503		H						152,740
- Research and development expenses		8,380			-			5,632											14,012
- Sales and marketing		-			14,732			(14,732	)										-
- Administration and other		-			64,884			(64,884	)										-
(Loss)/income from operations		(12,557	)		12,954						(12,724	)							(12,327	)
Other (expense)/income		(29	)		596														567
Interest income		103			939														1,042
Interest expense		1,602			2,089										9,426		L		13,117
Bargain purchase – Movingdots		9,034			-														9,034
(Loss)/income before income taxes		(5,051	)		12,400						(12,724	)			(9,426	)			(14,801	)
Income tax expense		589			6,820						(1,167	)	I		274		M		6,516
(Loss)/income before non-controlling interest		(5,640	)		5,580						(11,557	)			(9,700	)			(21,317	)
Non-controlling interest		(35	)		-						-				-				(35	)
Net (loss)/income		(5,675	)		5,580						(11,557	)			(9,700	)			(21,352	)
Accretion of preferred stock		(7,139	)		-						-				7,139		N		-
Preferred stock dividends		(4,493	)		-						-				4,493		N		-
Net (loss)/income	$	(17,307	)	$	5,580					$	(11,557	)		$	1,932			$	(21,352	)
Other comprehensive income/(loss):
Foreign currency translation adjustment		594			(4,256	)													(3,662	)
Comprehensive (loss)/income		(16,713	)		1,324						(11,557	)			1,932				(25,014	)
Less: Net loss attributable to non-controlling interest		-			-														-
Comprehensive (loss)/income	$	(16,713	)	$	1,324					$	(11,557	)		$	1,932			$	(25,014	)

Basic and diluted earnings per share (cents)	$	(0.49	)															$	(0.20	)
Weighted average common shares outstanding – basic and diluted (‘000) - Powerfleet		35,628									72,073		C						107,701

MiX ordinary shares outstanding		154,417
Exchange ratio		0.12762
Shares of Powerfleet common stock to be issued for MiX ordinary shares outstanding		19,707

MiX ADSs outstanding (representing 399,604 MiX ordinary shares)		15,984
Exchange ratio		3.19056
Shares of Powerfleet common stock to be issued for MiX ADSs outstanding		50,997
Total shares of Powerfleet common stock to be issued		70,704

Powerfleet stock price	$	5.12
Consideration to be paid	$	362,008

(In thousands)
Assets acquired	$	181,522
Fair value step up of identifiable assets		129,400
Fair value step up of identifiable intangible assets		138,753
Fair value adjustments to other assets		(9,353	)
Deferred tax liability		(34,938	)
Goodwill		162,546
Fair value of replacement awards issued by the acquirer		(3,012	)
Liabilities assumed		(73,505	)
Non-controlling interest		(5	)
Total estimated consideration	$	362,008

(In thousands)	Estimated fair value		Estimated useful life in years		Annual 2023 amortization expense
Trade name	$	10,000		14		700
Developed technology		30,000		5		6,000
Customer relationships		120,000		13		9,200
Total identifiable intangible assets and related amortization	$	160,000				15,900
Total amortization recorded						6,500
Transaction accounting adjustments to amortization					$	9,400

	(B)	Total transaction costs of $10.0 million ($6.3 million in accumulated deficit and $3.7 million related to withholding taxes related to the acceleration of Powerfleet stock options and restricted stock stock options and restricted stock in additional paid in capital) to be paid by Powerfleet as part of the closing of the transaction and other costs of $0.8 million.

	(C)	Stockholders’ equity includes the following adjustments:

Elimination of historical equity accounts of MiX Telematics	$	(108,012	)
Estimated total value of Powerfleet common stock to be issued		362,008		A
Accumulated deficit adjustments		(11,935	)	D
Compensation costs related to acceleration of Powerfleet stock options and restricted stock		1,126		E
Fair value of replacement awards issued by the acquirer		3,012		F
Total	$	246,199		C

Transaction costs (B)	$	(6,315	)
Other costs (B)		(806	)
Acceleration of Powerfleet stock options and restricted stock (E)		(4,814	)
Total	$	(11,935	)

Acceleration of Powerfleet stock options and restricted stock	$	4,814
Withholding taxes related to the acceleration of Powerfleet stock options and restricted stock (included in total transaction costs)		(3,688	)
Total	$	1,126

		$4.8 million share-based payment cost is recognized in accumulated losses and additional paid-in capital for the acceleration of Powerfleet stock options and restricted stock expected on the scheme implementation date. The amount recognized is based on the acceleration of future share-based payment costs expected at December 31, 2023. The accelerated vesting will result in an additional 1,368,567 shares of Powerfleet common stock being issued.

	(F)	The fair value of the replacement awards for the MiX Telematics equity plans is the difference between the fair value of the original MiX Telematics awards and the fair value of the replacement PowerFleet awards granted to existing MiX Telematics employees. The valuation was performed as at April 2, 2024. $3.0 million related to pre-combination vesting was taken into account in the consideration transferred, refer to Note 1. The remaining fair value of the replacement awards is recognized over the remaining vesting period as post combination compensation costs. For the year ended December 31, 2023 $5.0 million was recognized in selling, general and administrative expenses.

	(G)	Cost of revenues for the year ended December 31, 2023 includes the following adjustments (in thousands):

Amortization of identifiable intangible assets (Note 1)	$	9,400
Reversal of amortization of other assets (Note 1)		(4,179	)
Total	$	5,221

Powerfleet historical share-based payment costs reversed as vesting accelerated (E)		1,948
Transaction costs related to the acquirer, Powerfleet		(6,315	)
Reversal of amortization of other assets (Note 1)		899
Expense for the replacement awards issued by the acquirer (F)		(5,040	)
MiX Telematics historical share-based payment costs reversed as replacement rewards granted		1,005
Total	$	(7,503	)

(In thousands)
Settlement of Series A preferred stock	$	(90,273	)
Increase for issuance of new debt		103,800
Debt structuring fees		(1,131	)
Cash on hand	$	12,396

(In thousands)
Interest expense on new debt	$	(9,133	)
Amortization of new debt issuance costs		(293	)
Total	$	(9,426	)

	(M)	Tax expense on the additional withholding tax on interest related to funding raised.

	(N)	The redemption is assumed to take place on January 1, 2023; therefore the Accretion of preferred stock and Preferred stock dividends recognized by Powerfleet for the year ended December 31, 2023 has been reversed.

	(O)	Reclassifications have been made to MiX Telematics’ unaudited consolidated statement of income for the nine months ended December 31, 2023 included in MiX Telematics’ Quarterly Report on Form 10-Q plus the three months ended March 31, 2023, to conform the presentation to Powerfleet’s accounting policies for:

	a.	right of use asset included in fixed assets by MiX Telematics presented separately by Powerfleet;

	b.	combine accounts payable and accrued expenses and other liabilities presented separately by MiX Telematics to conform to the Powerfleet presentation;

	c.	current portion of lease liability included in accrued expenses and other liabilities by MiX Telematics presented separately by Powerfleet;

	d.	research and development expenses included in administration and other expenses presented separately by Powerfleet;

	e.	combine sales and marketing expenses and administration and other expenses to conform to the Powerfleet presentation.