UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.WASHINGTON, DC 20549

FORM 10-K

(Mark One)

☒         ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 20162023

OR

OR

☐         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ______________

Commission file numberFile Number: 000-55181

Twinlab Consolidated Holdings, Inc.

(Exact name of registrant as specified in its charter)

(561) 443-4301

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g)12(g) of the Act: common stock, par value $0.001 per share

Common Stock

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes☐ No☑Yes ☐No☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes☐ No☑Yes ☐No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☑ No☐Yes☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes☑ No☐Yes☒ No ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to Form 10-K. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer" and, "smaller reporting company"company," and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):Large accelerated filer

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.     ☐ Accelerated filer ☐ Non-accelerated filer ☐ Smaller

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting company ☑under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262 (b)) by the registered public accounting firm that prepared or issued its audit report.      ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.       ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).       ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes☐ No☑Yes ☐ No ☒

The aggregate market value of common stock held by non-affiliates of the registrant at June 30, 20162023 was $26,826,344$3,257,773 (computed by reference to the average bid and askedhigh/low price on such date).

The number of shares of common stock, $0.001 par value, outstanding on March 31, 201715, 2024 was 252,924,027259,092,833 shares.

DOCUMENTS INCORPORATED BY REFERENCE

None.

Specified portions of the registrant’s definitive proxy statement for the 2017 Annual Meeting of Stockholders, which will be filed with the Securities and Exchange Commission within 120 days after the end of the year covered by this report, are incorporated by reference into Part III of this report.

TABLE OF CONTENTS

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Marketing and Promotion

TCC markets to consumers shopping through numerous retailsales channels and online e-tailers. Each channel demands a different approach that meets its distinctive needs. The following is a brief overview of the channels in which we market our varied brands:

Marketing Efforts by Brand

Reserveage™Reserveage™ Nutrition

Reserveage™Reserveage™ Nutrition uses consistent messaging to emphasize our use of premium and traceable ingredients that are backed by published clinical studies. The brand takes a 360 degree360-degree marketing approach to drive sales to our retail partners. The focus is to grow brand awareness and increase sales directed at both the retail community and our end consumers.

Marketing strategies for Reserveage™Reserveage™ Nutrition include two main initiatives: 1) introduce new users to our core categories – anti-aging and beauty from within – through innovation and expanded categories, product trial, advertising and promotional programs and 2) increase in-store education through dedicated brand ambassadors in strategic markets.

Marketing and promotional efforts for Reserveage™Reserveage™ Nutrition focus on both trade and consumer tactics:

Public Relations/BloggersInfluencers – Outreach to media and blogger influencers has resulted in features and reviews in online and print media channels. This channel is especially important in our beauty from within line of products, where online influencers can both positively or negatively affect the success of a product.

Sampling – Many products are immediately experiential either because of their taste or effect. We use samples and retail demo programs to allow for trial and education of our products. These are generally conducted in-store using our own brand ambassadors or third partythird-party representatives.

Retail Activation – Utilizing on-shelf promotional tactics, including coupons and associate engagement tools, to generate awareness and differentiate our brand.

Consumer and Trade Print Ads – Print advertising is coordinated with product introductions.

Digital/Social Activation - Target and retarget prospective consumers through search engine optimization, search engine marketing, and social media campaigns.

Re-Body®ResVitale®

Re-Body® products are science-backed dietary supplements and foods that help consumers achieve their weight-loss goals and maintain a healthy weight. The Re-Body® brand is primarily sold through the direct to consumer channel and QVC, a home shopping network.

ResVitale®

The ResVitale® brand of dietary supplements is marketed and sold exclusively to GNC.GNC and online. Marketing strategies for the ResVitale® brand include two main initiatives: 1) to introduce new users to our core categories – anti-aging and beauty from within – through awareness campaigns and product trial and 2) to increase in-store education through brand ambassadors in strategic markets.

Twinlab® Brand Vitamins

Twinlab® is a heritage brand of vitamins that has been in the market for over 4950 years and carries a great deal of brand awareness amongst health and natural food consumers. Since Twinlab® is a distributed brand (shipping to certain major retailers, but also to nationwide distributors who resell to smaller retailers), we deliver training to distributor sales teams predominantly sold in HNF, eTailers and participate in distributor and retailer shows designed to reach retailers and store managers.Internationally.

Marketing strategies for Twinlab® include two main initiatives: 1) awareness and trial of key existing products and 2) awareness, trial and education for new products.

Marketing and promotional efforts for Twinlab® focus on both trade and consumer tactics:

Public Relations and Bloggers – Outreach to media and blogger influencers has resulted in features and reviews in online and print media channels.

Retailer Promotions – In-store promotional programs can drive consumer awareness when they are making purchase decisions. Manufacturer charge-backs, which deduct the cost of these programs from retailer

Consumer and Trade Print Ads – Print advertising is coordinated with product purchases, are created for retailers to support product features and promotions throughout the year. These programs are designed to incentivize the retailer to display products in secondary placement (multiple store locations) and often provide a discount to create excitement and deliver incremental savings in order to drive consumer purchases.introductions.

Coupons – Coupons are incorporated into different communication vehicles when appropriate to drive product trial use and create excitement.

Trade Shows – Retailer relations and new product launches are the main areas of focus during trade shows. Display and promotion of products at several industry trade shows annually is a key component of support for Twinlab®.

Alvita® Teas

Twinlab® Fuel

Marketing and promotional efforts for Twinlab® Fuel focus on consumer tactics:

Promotions - Promotional activity, including branded gear, helps keep consumers interested in the brand dynamic.

International Marketing - Internationally, we partner with our top distributors who follow a similar strategy at a local level, helping to create awareness, interest and drive sales. 

Social Media - Instagram and Facebook are mainstays for our digital strategy, with exploration into new “Live” options offered by each platform, allowing us to deepen our connection with our consumers. 

Alvita® Teas

Started in 1922, Alvita® Teas is an herbal therapeutic tea line with a rich history and loyal customer base. The herb alfalfa, long known for its beneficial nutrients, was packaged in tea bags and sold to an emerging health food market. This product became known as Alvita®. Over 90After reaching 100 years, later, Alvita® has become the oldest herbal tea brand. Today, Alvita® has more than 4030 single ingredient high potency teas, each with distinct health benefits. Each tea is committed to third party certifications and offers the purity standards of Organic, Gluten-free, non-GMO, caffeine free and Kosher certifications.

Marketing tactics for Alvita® include retailer promotions, coupons and trade show participation.

NutraScience Labs,, Inc.

NutraScience helpsLabs helped dietary supplement companies bring high-quality formulations to the market by delivering best-in-class, turnkey manufacturing, packaging design, and fulfillment services “under one roof”. Marketing activities for NutraScience Labs focusesfocused on promoting the services it offered with a focus on acquiring new customers through digital marketing and trade media.media and not advertising of products. The services performed under NutraScience Labs ceased with the abandonment of operations that began in July 2023.

Research and Development; Quality ControlAssurance

We have a commitment to research and development (“R&D”) and to introducing innovative products to correspond with consumer trends and scientific research. We believe that product quality and innovation are fundamental to our long-term growth and success. Through our R&D and quality assurance ("QA") efforts, as well as our relationships with select and current Good Manufacturing Practices (“cGMPs”) audited contract manufacturing partners, we seek to (i) test the safety, purity and potency of products, (ii) develop testing methods for ensuring and verifying the consistency of the dosage of ingredients included in our products, (iii) develop new, more effective product delivery forms and (iv) develop new products either by combining existing ingredients used in nutritionaldietary supplements or identifying new ingredients that can be used in nutritionaldietary supplements. Our efforts are designed to lead not only to the development of new and improved products, but also to ensure effective manufacturing quality controlassurance measures.

We conduct research and formulation aspects of R&D in our own facilitiesin-house, and also work with outside firms to contract manufacturers and third-party laboratories to perform testing and other aspects of R&D. We currently employ various professionals in R&D and quality controlassurance with expertise in, among other things, chemistry, microbiologynutrition, herbal medicine, and engineering. In addition, we retain the services of outside laboratories to validate our product standards and manufacturing protocols.chemistry.

We spent approximately $1,266 and $1,577 for R&D for the fiscal years ended December 31, 2016 and 2015, respectively. The key to our strategy is innovation and we intend to continue to allocate the appropriate resources to ensure our products remain top of choice with consumers, retailers, and our strategic partners.

Our quality controlassurance and safety programs seek to ensure the safety and superior quality of our products and that they are manufactured in accordance with current Good Manufacturing Practices (“cGMPs”).cGMPs. We have always had a focus on safety, quality, efficacy and compliance with law. Our processing methods are monitored closelyWe always conduct a comprehensive cGMP audit to ensure that only quality ingredients are used and to ensure product purity.qualify a contract manufacturer before conducting business with them.

Significant Customers

Sales to our top three customers aggregated to approximately 27%31% and 23%21% of total consolidated sales in 20162023 and 2015,2022, respectively. Sales to one of those customers were approximately 12%15% and 15%8% of total sales in 20162023 and 2015,2022, respectively. Accounts receivable from these customers were approximately 29%33% and 24%28% of total accounts receivable as of December 31, 20162023 and 2015,2022, respectively. Our strategy remains to diversify our offerings and channels so as to lessen dependence upon any one customer or customers.

Manufacturing

Manufacturing

We manufacture domestically in Utah, at which a significant majority of our Twinlab® and Alvita® brandedOur products are manufactured, and also have certain of our products manufactured by highly qualified third-party providers located primarily in the U.S. and Canada. We have industry-standard manufacturing and production equipment in our 170,000 square foot facility in American Fork, Utah.

Our manufacturing process generally consists of the following operations: (i) sourcing ingredients for products, (ii) warehousing raw ingredients, (iii) measuring ingredients for inclusion in products, (iv) blending, grinding, and chilsonating ingredients into a mixture with a homogeneous consistency and (v) encapsulating, tableting, pouring, pouching, bagging or boxing the blended mixture into the appropriate dosage form using either automatic or semiautomatic equipment. The next step, bottling and packaging, involves placing the product in packaging with appropriate tamper-evident features and sending the packaged product to a distribution point for delivery to retailers. We place special emphasis on quality control, including raw material verification, homogeneity testing, weight deviation measurements and quality sampling. See "Research and Development; Quality Control."

We also have numerous contract manufacturers geographically spread across the country. These contract manufacturers include softgel manufacturers, liquid manufacturers and other specialty manufacturers as and when needed. These contract manufacturers do business with us under both shortshort- and long termlong-term contracts depending on our needs. We do not manufacture any of the basic materials used in packaging (bottles, boxes, shipping cartons, caps, tamper resistant films, etc.). We believe that ourincreasing manufacturing capabilities coupled withthrough our contract manufacturer partners provides us with competitive advantages.

In 2018, we transitioned out of manufacturing in the Company’s Utah manufacturing facility and leveraged the supply chain of the Company’s subsidiary, NutraScience Labs., and third-party logistics providers. This allows us to utilize exclusive technologies and processes that contribute to product innovation, while still providing the high-quality products our customers know us for. The services performed under NutraScience Labs ceased with the abandonment of operations that began in July 2023. 

Materials and Suppliers

We employ a supply chain staff that works with marketing, product development, formulations and quality control personnelquality assurance personnel to oversee contract manufacturers and source raw materials for products as well as other items purchased by us. Raw materials are sourced by a variety of domestically and internationally approved suppliers principally from the United States, Europe and China. We believe our relationships with our principal suppliers such as Bactolac Pharmaceutical, Inc. and Rasi Laboratories, Inc., are good. WeOur top two suppliers accounted for18% of our purchases for the year ended December 31, 2023. Whenever possible, we have adopted dual sourcing for raw materials where available to mitigate the impact of raw materials shortages that happen from time to time.

Government Regulation

The formulation, manufacturing, packaging, labeling, advertising, distribution and sale of our products are subject to regulation by a number of United States federal agencies, including the Food and Drug Administration ("FDA"), the Federal Trade Commission ("FTC"), the Consumer Product Safety Commission ("CPSC"), the United States Department of Agriculture (“USDA”), Department of Labor Occupational Safety and Health Agency (“OSHA”), Department of Homeland Security Customs and Boarder Protection (“CBP”), Department of Transportation (“DOT”), and the Environmental Protection Agency (“EPA”), by various governmental agencies for the states and localities in which our products are sold, and by governmental agencies in countries outside the United States in which our products are sold.

The FDA regulates the formulation, manufacturing, packaging, labeling, distribution and sale of food, including dietary supplements, cosmetics, and over-the-counter ("OTC") drugs. The FTC regulates the advertising of these products. Federal agencies, primarily the FDA and the FTC, have a variety of procedures and enforcement remedies available to them, including initiating investigations, issuing warning letters and cease-and-desist orders, requiring corrective labeling or advertising, requiring consumer redress, seeking injunctive relief or product seizures, imposing civil penalties or commencing criminal prosecution. In addition, certain state agencies have similar authority.

The Dietary Supplement Health and Education Act (“DSHEA”) was enacted in 1994, amending the Federal Food, Drug, and Cosmetic Act (“FDCA”). Dietary ingredients marketed in the United States before October 15, 1994 may be marketed without the submission of a "new dietary ingredient" premarket notification to the FDA. New dietary ingredients, with exception,some exceptions not marketed in the United States before October 15, 1994, are required to be submitted to the FDA at least seventy-five days before marketing. In addition, dietary ingredients and applicable excipients on the FDA’s GRAS list (Generally Regarded As Safe) may be included in dietary supplement formulations.Among other things, DSHEA prevents the FDA from regulating dietary ingredients in dietary supplements as "food additives" and allows the use of statements ofof structure function claims on product labels and in labeling, so long as those statements do not constitute disease claims and are truthful and sufficiently substantiated. Some of our products are also regulated as conventional foods under the Nutrition Labeling and Education Act of 1990 (“NLEA”).

The FDA issued a Final Rule on GMPs (Good Manufacturing Practices) for dietary supplements in June 2007. The GMPs cover manufacturers, packagers, labelers, distributors, and holders of finished dietary supplement products, including dietary supplement products manufactured outside the United States that are imported for sale into the United States. Among other things, these GMPs require identity testing on all incoming dietary ingredients, call for a "scientifically valid system" for ensuring finished products meet all specifications, include requirements related to process controls such as statistical sampling of finished batches for testing and requirements for written procedures and require extensive recordkeeping.

The Food Allergen Labeling and Consumer Protection Act of 2004 ("FALCPA") addresses, among other issues, the labeling of foods (including dietary supplements) that contain certain food allergens. Under FALCPA, a "major food allergen" is an ingredient that contains protein derived from one of the following: milk, egg, fish, Crustacean shellfish, tree nuts, wheat, peanuts or soybeans.

The Dietary Supplement and Nonprescription Drug Consumer Protection Act went into effect in December 2007. The law requires, among other things, that companies that manufacture or distribute nonprescription drugs or dietary supplements report serious adverse events allegedly associated with their products to the FDA and institute recordkeeping requirements for all adverse events (serious and non-serious).

The Consumer Product Safety Improvement Act of 2008 ("CPSIA") primarily addresses children's product safety but also improves the administrative process of the CPSC. Among other things, the CPSC/CPSIA impact on dietary supplements is principally in requirements for use of child resistant closures, performance validation of such closures, and requirements for packaging and labeling of iron-containing products. The CPSIA also requires testing and certification of certain products and enhances the CPSC's authority to order recalls. 

The FDA Food Safety Modernization Act ("FSMA"), enacted in January 2011, amended the FDCA to significantly enhance the FDA's authority over various aspects of food regulation. The FSMA granted the FDA mandatory recall authority when the FDA determines there is a reasonable probability that a food is adulterated or misbranded and that the use of, or exposure to, the food will cause serious adverse health consequences or death to humans or animals. Other changes include, but are not limited to, the FDA's expanded access to records; the authority to suspend food facility registrations and require high risk imported food to be accompanied by a certification; stronger authority to administratively detain food; the authority to refuse admission of an imported food if it is from a foreign establishment to which a U.S. inspector is refused entry for an inspection; and the requirement that importers verify that the foods they import meet domestic standards.

Although dietary supplement facilities are exempt from preventive controls requirements, dietary ingredient facilities might not qualify for the exemption. FDA's proposed preventative controls regulations would require that facilities develop and implement preventive controls to assure that identified hazards are significantly minimized or prevented, monitor the effectiveness of the preventive controls, and maintain numerous records related to those controls. 

California Proposition 65 (“Prop 65”) is particularly impactful and imposing among state regulations. Its impact on product formulations, testing, and labeling are extensive and significant. Because of national brand distribution, the impact of Prop 65 is far reaching. TCC has several Prop 65 consent agreements whichthat afford compliance protections.

The sale of our products in countries outside the United States is regulated by the governments of those countries. Our plans to commence or expand sales in those countries may be prevented or delayed or even suspended by such regulations or regulators in those countries. In countries in which we have distributors, compliance with such regulations is generally undertaken by our distributors, but even in these cases we often cooperate by providing information to distributors. In the case of Canada, TCC complies with Health Canada’s Natural Health Products Directorate (“NHPD”) with “site licensing” of the TCC manufacturing plant and registration of products.

Competition

Health and Natural Foods

The Natural Products Market and the VMSVitamin, Minerals, and Supplements Market (the “VMS Market”) are highly competitive. Our principal competitors in the VMS marketMarket that sell to the health and natural foods channel include a number of large, nationally-known brands (such as Bluebonnet, Country Life, Enzymatic Therapy, Garden of Life, Jarrow Formulas, Natural Factors, Nature's Plus, Nature's Way, Nordic Naturals, Now Foods, New Chapter and Solgar) and many smaller brands, manufacturers and distributors of nutritional supplements. Because both the health and natural foods market and the VMS Market generally have low barriers to entry, additional competitors enter the market regularly.

Private label products of our customers also provide competition to our products. Whole Foods Market, The Vitamin Shoppe, Sprouts Farmers Market, Natural Grocers and many health and natural food stores also sell a portion of their offerings under their own private labels. Private label products are often sold at a discount to branded products.

We believe that stores in the HNF channel are increasingly likely to align themselves with those companies that offer a wide variety of high-quality products, have a loyal consumer base, support their brands with strong marketing and education programs and provide consistently high levels of customer service. We believe that we compete favorably with other nutritional supplement companies because of our comprehensive line of products and brands, premium brand names, commitment to quality, ability to rapidly introduce innovative products, competitive pricing, strong and effective sales force, distribution strategy and sophisticated marketing and promotional support. The wide variety and diversity of the forms, potencies and categories of our products are important points of differentiation between us and many of our competitors.

Mass Market

Metabolife® is our primary focus in the Mass Marketmass market retail channel. It is possible that as an increasing numbersnumber of companies (or brands) sell nutritional supplement products and other natural products in the mass market channels, such as Pharmavite (Nature Made), The Carlyle GroupKKR & Co. L.P. (Nature's Bounty), Reckitt Benckiser Group (Schiff), Hain Celestial and Church & Dwight, our mass market brands will be negatively impacted. In addition, several major pharmaceutical companies continue to offer nutritional supplement lines in the mass market channel, including Pfizer (Centrum) and Bayer (One-A-Day).

Performance

The performance channel is primarily made up of independent retailers that focus their product mix on performance products, as well as gyms, health clubs and other health and fitness locations that house small stores to cater to the needs of their clients. There is also a small vibrant market serviced by bicycle shops and other specialty sports equipment retailers, and even larger sporting goods stores, like Dick’s Sporting Goods, which are testing sports nutrition sets in their stores. The retail performance channel is supplied by a specialty distributor that focuses exclusively on this channel (Europa Sports Nutrition). In recent years the performance channel has become dominated by several online retailers (www.allstarhealth.com, www.bodybuilding.com, www.dpsnutrition.com, www.muscleandstrength.com, www.netrition.com, and www.supplementwarehouse.com) that have the advantage of broad selection and aggressive pricing.

Competition in this channel is intense. The character of the target customer makes the barriers to entry in sports nutrition extremely low as consumers look for the next great product that will help them optimize their workout. As a result, competition includes the somewhat large stable core brands (BSN, CytoSport, Five Star, Met-Rx, MHP, MRI, MusclePharm, Optimum Nutrition, Twinlab®, VPX, etc.) as well as a secondary level of innovative, small companies with niche products focused on this specific targeted customer.

Intellectual Property

We own numerous trademarks that have been registered with the United States Patent and Trademark Office and have filed applications to register additional trademarks. In addition, we claim domestic trademark and service mark rights in numerous additional marks that we use. We own a number of trademark registrations in countries outside the United States. Federally registered trademarks in the United States have a perpetual life, as long as they are maintained and renewed on a timely basis and used properly as trademarks, subject to the rights of third parties to seek cancellation of the trademarks if they claim priority or confusion of usage. Most foreign trademark offices use similar trademark renewal processes. Additionally, we hold several patents that have been registered with the United States Patent and Trademark Office and may file additional applications. We regard our trademarks, patents and other proprietary rights as valuable assets and believe they make a significant positive contribution to the marketing of our products.

We protect our legal rights concerning our intellectual property by taking appropriate legal action. We rely on common law trademark rights to protect our unregistered trademarks. Common law trademark rights do not provide us with the same level of protection as afforded by a United States federal registration of a trademark. In addition, common law trademark rights are limited to the geographic area in which the trademark is actually used. We have registered and intend to register certain trademarks in certain limited jurisdictions outside the United States where our products are sold, but we may not register all or even some of our trademarks in every country in which we conduct business or intend to conduct business.

We sell a number ofmany products that include patented ingredients. We purchase these ingredients from parties that we believe haveare licensed by the rightpatent owner to sell and manufacture and sell those ingredients to us.goods with the patent ingredients. However, there are a large number of patents that have been granted or applied for in the dietary supplement industry, and there may be an increased possibility that third parties will seek to compel us and our competitors to purchase their patented ingredients"patented ingredients" directly from them under threat that patent ingredient we properly obtain, infringes on their patent rights. We generally obtain indemnification from the patent owner through separate end user licensing agreements to increase our protection from these third parties or file infringement actions.“non-practicing entities,” should they try to enforce such claim through litigation. The cost of these patented ingredients is typically higher than the cost of non-patented ingredients.

Employees

As of March 31, 2017,15, 2024, we had 226approximately 17 full-time employees and 31 part-time employees.employee. None of our employees isare represented by a labor union or covered by a collective bargaining agreement. We consider our relationship with our employees to be good.

Our business, financial condition, results of operations, cash flows, prospects, and the prevailing market price and performance of our common stock may be adversely affected by a number of factors, including the matters discussed below. Certain statements and information set forth in this Annual Report on Form 10-K, including without limitation statements regarding our strategic initiatives and expectations for the future performance of our business, as well as other written or oral statements made from time to time by us, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact, including statements that describe our objectives, plans, or goals, are, or may be deemed to be, forward-looking statements. Known and unknown risks, uncertainties, and other factors may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these statements. The risks, uncertainties, and other factors that our stockholders and prospective investors should consider include the following:

Market and Channel Risks

Geopolitical issues, conflicts and other global events could adversely affect our results of operations and financial condition.

Our business is subject to global political issues and conflicts. Such political issues and conflicts could have a material adverse effect on our results of operations and financial condition if they escalate in areas in which we do business or to the extent that they impact the global macroeconomic systems. In addition, changes in and adverse actions by governments in foreign markets in which we do business could have a material adverse effect on our results of operations and financial condition. For example, the continuing conflict arising from the Russian invasion into Ukraine could adversely impact macroeconomic conditions, give rise to regional instability and result in heightened economic tariffs, sanctions and import-export restrictions from the U.S. and the international community in a manner that adversely affects us, financial condition, results of operations, cash flows and performance. 

Adverse economic conditions related to the COVID-19 pandemic or future pandemic may harm our business.

Inflation and other changes in economic conditions related to the ongoing COVID-19 pandemic, and the future outbreak of other highly infectious or contagious diseases, could materially and adversely impact or disrupt our financial condition, results of operations, cash flows and performance.

The COVID-19 pandemic has had, and another pandemic in the future could have, repercussions across regional and global economies and financial markets. The outbreak of COVID-19 in many countries, including the United States, has significantly adversely impacted global economic activity and has contributed to significant volatility and negative pressure in financial markets. The global impact of the outbreak has been rapidly evolving and, as cases of COVID-19 have continued to be identified in additional countries, many countries, including the United States, have reacted by instituting quarantines, mandating business and school closures and restricting travel.

Certain states and cities, including where our principal place of business is located, reacted by instituting quarantines, restrictions on travel, “shelter in place” rules, and/or restrictions on types of business that may continue to operate. While these restrictions have been lifted or significantly curtailed, the Company cannot predict if future impacts of COVID-19, including the emergence of new variants, will lead to the reinstitution of similar restrictions or the implementation of new restrictions. The COVID-19 pandemic has negatively impacted almost every industry directly or indirectly, including industries in which the Company and our customers and business partners operate. The effects of an ongoing period of remote work, could strain our business continuity plans, introduce operational risk, including but not limited to cybersecurity risks, and impair our ability to manage our business. The COVID-19 pandemic, or a future pandemic, could also have material and adverse effects on our ability to successfully operate and on our financial condition, results of operations and cash flows due to, among other factors:

The extent to which the COVID-19 pandemic or another pandemic in the future may impact our operations and those of our customers will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. Any future closures by our customers of their stores could reduce our cash flows.

Our success is linked to the size and growth rate of the vitamin, mineral and supplement market and an adverse change in the size or growth rate of that market could have a material adverse effect on us.

An adverse change in the size or growth rate of the vitamin, mineral and supplement market could have a material adverse effect on us. Underlying market conditions are subject to change based on economic conditions, consumer preferences, the impact of wide spread health concerns or pandemics and other factors that are beyond our control, including media attention and scientific research, which may be positive or negative.

Because a substantial portion of our sales are to or through health food stores, we are dependent to a large degree upon the success of this channel as well as the success of specific retailers in the channel.

We sell primarily in the United States and, in this market, a significant portion of our sales are through health food stores. Because of this, we are dependent to a large degree upon the success of that channel as well as the success of specific retailers in the channel. There are some large chains of health food stores, such as Whole Foods Market and The Vitamin Shoppe, but many health food stores are individual stores or very small chains. We rely on these health food stores to purchase, market, and sell our products. A fair portion of our success is dependent, to a large degree, on the growth and success of the health and natural foods channel, which is outside our control. There can be no assurance that the health and natural foods channel will be able to grow or prosper as it faces price and service pressure from other channels, including the mass market. There can be no assurance that retailers in the health and natural foods channel, in the aggregate, will respond or continue to respond to our stated loyalty to this channel.

We are highly dependent upon consumers' perception of the safety and quality of our products as well as similar products distributed by other companies in our industry, and adverse publicity and negative public perception regarding particular ingredients or products or our industry in general could limit our ability to increase revenue and grow our business.

Decisions about purchasing made by consumers of our products may be affected by adverse publicity or negative public perception regarding particular ingredients or products or our industry in general. This negative public perception may include publicity regarding the legality or quality of particular ingredients or products in general or of other companies or our products or ingredients specifically. Negative public perception may also arise from regulatory investigations, regardless of whether those investigations involve us. We are highly dependent upon consumers' perception of the safety and quality of our products as well as similar products distributed by other companies. Thus, the mere publication of reports asserting that such products may be harmful could have a material adverse effect on us, regardless of whether these reports are scientifically supported. Publicity related to nutritional supplements may also result in increased regulatory scrutiny of our industry and/or the healthy foods industry. Adverse publicity may have a material adverse effect on our business, financial condition and results of operations. There can be no assurance of future favorable scientific results and media attention or of the absence of unfavorable or inconsistent findings.

We face intense competition from competitors that are larger, more established and that possess greater resources than we do, and if we are unable to compete effectively, we may be unable to maintain sufficient market share to sustain profitability.

Numerous manufacturers and retailers compete actively for consumers. There can be no assurance that we will be able to compete in this intensely competitive environment. In addition, nutritional supplements can be purchased in a wide variety of channels of distribution. These channels include mass market retail stores and the Internet. Because these markets generally have low barriers to entry, additional competitors could enter the market at any time. Private label products of our customers also provide competition to our products. Additional national or international companies may seek in the future to enter or to increase their presence in the healthy foods industry or the vitamin, mineral and supplement market. Increased competition in either or both could have a material adverse effect on us. 

The nutritional supplement industry increasingly relies on intellectual property rights and although we seek to ensure that we do not infringe the intellectual property rights of others, there can be no assurance that third parties will not assert intellectual property infringement claims against us, which claims may result in substantial costs and diversion of management and other resources and could have a material adverse effect on our business, financial condition and operating results. Our inability to acquire, protect or maintain our intellectual property could harm our ability to compete or grow.

Recently it has become more and more common for suppliers and competitors to apply for patents or develop proprietary technologies and processes. We seek to ensure that we do not infringe the intellectual property rights of others, but there can be no assurance that third parties will not assert intellectual property infringement claims against us. These developments could prevent us from offering or supplying competitive products or ingredients in the marketplace. They could also result in litigation or threatened litigation against us related to alleged or actual infringement of third-party rights. If an infringement claim is asserted or litigation is pursued, we may be required to obtain a license of rights, pay royalties on a retrospective or prospective basis or terminate our manufacturing and marketing of our products that are alleged to have infringed. Litigation with respect to such matters could result in substantial costs and diversion of management and other resources and could have a material adverse effect on our business, financial condition and results of operations. We have numerous United States and foreign trademarks and service marks. There can be no assurance that the protection afforded by these trademarks and service marks will provide us with a competitive advantage or that we will be able to assert our intellectual property rights in infringement actions.

We may be affected adversely by future increases to utility and fuel costs.

Future increases in fuel costs may affect our results of operations adversely in that consumer traffic to health and natural food stores may be reduced and the costs of our sales may increase as we incur higher fuel costs in connection with our manufacturing operations and the transportation of goods from our warehouse and distribution facilities to health and natural food stores. Also, increases in oil costs can affect the cost of our raw materials and components and the competitive environment in which we operate may limit our ability to recover higher costs resulting from future increases in fuel prices.

Business Strategy and Operational Risks

If we are unable to retain key personnel and members of our Board of Directors, our ability to manage our business effectively could be negatively impacted.

Key management employees of the company and its subsidiaries include Kyle Casey as the Interim Chief Executive Officer and Chief Financial Officer. This key management employee is primarily responsible for our day-to-day operations, and we believe our success depends in part on our ability to retain him and to continue to attract additional qualified individuals to our management team. We have experienced several resignations from management and the Board of Directors in 2022, including Craig Fabel who served as the Chief Executive Officer, Daniel DiPofi who previously served as Chief Executive Officer, and B. Thomas Golisano and Seth Ellis who were members of the Board of Directors. The loss or limitation of the services of any of our key management employees or members of our Board of Directors or the inability to attract additional qualified management personnel could have a material adverse effect on our business, financial condition and results of operations.

As a part of our business strategy, we have completed and may pursue acquisitions in the future that could disrupt our operations and harm our operating results.

An element of our strategy includes expanding our product offerings, gaining shelf-space and gaining access to new skills and other resources through strategic acquisitions when attractive opportunities arise. Acquiring additional businesses and the implementation of other elements of our business strategy are subject to various risks and uncertainties. Some of these factors are within our control and some are outside our control. These risks and uncertainties include, but are not limited to, the following:

There can be no assurance that attractive acquisition opportunities will be available to us, that we will be able to obtain financing (on acceptable terms or at all) for or otherwise consummate any future acquisitions, including those described above, or that any acquisitions which are consummated will prove to be successful. There can be no assurance that we can successfully execute all aspects of our business strategy.

Because we depend on outside suppliers with whom we may not have long-term agreements for raw materials, we may be unable to obtain adequate supplies of raw materials for our products at favorable prices or at all, which could result in product shortages and back orders for our products, with a resulting loss of net sales and profitability.

We acquire all our raw materials for the manufacture of our products from third-party suppliers. Currently, we rely on third-party co-packers for our products; our reliance on them has increased as the result of winding down our Utah manufacturing facility in 2018. We have selective agreements for the continued supply of materials and products. Several of our products contain one or more ingredients that may only be available from a single source or supplier. Any of our suppliers could discontinue selling to us at any time. In certain situations, we may be required to alter our products or substitute different materials from different alternative sources. Our suppliers or government regulators may interpret new regulations (including cGMP regulations) in such a way as to cause a disruption in our supply chain as these parties undertake increased scrutiny of raw materials and components of raw materials and products, causing certain suppliers or us to discontinue, change or suspend the sale of certain ingredients or components. Although we believe that we could establish alternate sources for most of these materials, any delay in locating and establishing relationships with other sources could result in product shortages and back orders for the products, with a resulting loss of net sales and profitability. We are also subject to delays associated with raw materials. These can be caused by conditions not within our control, including:

These factors could result in a delay in or disruption of the supply of certain raw materials. Any significant delay in or disruption of the supply of raw materials could have a material adverse effect upon us.

We rely on our information systems to conduct our business, and any failure to protect these systems against security breaches or failure of these systems themselves could adversely affect our business, results of operations and liquidity and could result in litigation and penalties. If these systems fail or become unavailable for any significant period of time, our business could be harmed. Additionally, the inappropriate use of social media vehicles could harm our reputation and adversely impact our business.

The efficient operation of our business is dependent on computer hardware and software systems. Among other things, these systems collect and store certain personal information from customers, vendors and employees and process customer payment information. Our information systems and those maintained by our third-party vendors and the sensitive data they are designed to protect are vulnerable to security breaches by computer hackers, cyber terrorists and other cyber attackers. We rely on industry accepted security measures and technology to securely maintain confidential and proprietary information maintained on our information systems, and we rely on our third-party vendors to take appropriate measures to protect the confidentiality of the information on those information systems. However, these measures and technology may not adequately prevent security breaches. Our information systems may become unavailable or fail to perform as anticipated for any reason, including viruses, loss of power or human error. Any significant interruption or failure of our information systems or those maintained by our third-party vendors or any significant breach of security could adversely affect our reputation with our customers, vendors and employees and could adversely affect our business, results of operations and liquidity and could result in litigation against us or the imposition of penalties. A significant interruption, failure or breach of the security of our information systems or those of our third-party vendors could also require us to expend significant resources to upgrade the security measures and technology that guard sensitive data against computer hackers, cyber terrorists and other cyber attackers.

Additionally, we rely on search engine marketing and social media platforms to attract and retain customers as part of our marketing efforts. A variety of risks are associated with the use of social media, including the improper disclosure of proprietary information, negative comments about our company and our products, exposure of personally identifiable information, fraud, or outdated information. The inappropriate use of social media vehicles by our customers or employees could increase our costs, lead to litigation or result in negative publicity that could damage our reputation.

To the extent that we currently rely on third-party manufactures, now and in the future, we are dependent upon the uninterrupted and efficient operation of those third-party facilities, which may experience power failures, the breakdown, failure or substandard performance of equipment, the improper installation or operation of equipment, natural disasters, pandemic outbreaks or other disasters and the need to comply with the requirements or directives of government agencies, including the FDA.

We are dependent upon the uninterrupted and efficient operation of our third-party manufacturing partners. Those operations may experience power failures, the breakdown, failure or substandard performance of equipment, the improper installation or operation of equipment, natural disasters, pandemic outbreaks or other disasters and the need to comply with the requirements or directives of government agencies, including the FDA. There can be no assurance that the occurrence of these or any other operational problems at our facility would not have a material adverse effect on our business, financial condition and results of operations.

We may become a party to lawsuits that arise in the ordinary course of business in the future.

We may become a party to lawsuits that arise in the ordinary course of business in the future. The possibility of such litigation, and its timing, is in large part outside our control. It is possible that future litigation could arise that could have material adverse effects on us.

If our goodwill or intangible assets become impaired, we may be required to record a significant charge to earnings.

Under generally accepted accounting principles, we review our amortizable intangible assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Goodwill and indefinite-lived intangible assets are tested for impairment at least annually. Factors that may indicate that the carrying value of our goodwill or intangible assets may not be recoverable include a decline in stock price and market capitalization, reduced future cash flow estimates and slower growth rates in our industry. During the fourth quarter of fiscal 2023, we completed our annual impairment test of goodwill and intangible assets and recognized impairment charges, see Note 5 in the Notes to Consolidated Financial Statements included in this report.

We may need additional capital in the future to finance our operations and to execute our business strategy, which we may not be able to raise, or it may only be available on terms unfavorable to us and or our stockholders. This may result in our inability to fund our working capital requirements and harm our operational results.

Our current cash on hand is insufficient to fund our operations beyond the next twelve months. We believe that cash flows from operations and other committed sources of additional liquidity will be sufficient to fund our operations in the ordinary course of business. However, if we experience extraordinary expenses or other events beyond our control, we will need to raise additional funds to continue our operations.

Additional financing might not be available on terms favorable to us, or at all. The economic impact of world events and inflation could make it more difficult or challenging to obtain additional financing or adversely affect the favorability of the terms of any available financing. If adequate funds were not available or were not available on acceptable terms, our ability to fund our operations, take advantage of unanticipated opportunities, develop, or enhance our business or otherwise respond to competitive pressures would be significantly limited.

Changes in accounting standards, especially those that relate to management estimates and assumptions, are unpredictable and may materially impact how we report and record our financial condition.

Our accounting policies and methods are fundamental to how we record and report our financial condition and results of operations. Some of these policies require use of estimates and assumptions that may affect the value of our assets or liabilities and financial results and are critical because they require management to make difficult, subjective and complex judgments about matters that are inherently uncertain. From time to time the Financial Accounting Standards Board ("FASB") and the Securities and Exchange Commission (the "SEC") change the financial accounting and reporting standards that govern the preparation of our financial statements. In addition, accounting standard setters and those who interpret the accounting standards (such as the FASB, the SEC, banking regulators and our outside auditors) may change or even reverse their previous interpretations or positions on how these standards should be applied. These changes can be hard to predict and can materially impact how we record and report our financial condition and results of operations. In some cases, we could be required to apply a new or revised standard retroactively, resulting in our restating prior period financial statements.

Because of our history of accumulated deficits, recurring losses and negative cash flows from operating activities, we must improve profitability and may be required to obtain additional funding if we are to continue as a "going concern."

We had recurring net operating losses in fiscal year 2023.  We had negative working capital at the end of fiscal year 2023 and 2022. As of December 31, 2023, and 2022, our accumulated deficit was $370.1 million and $356.4 million, respectively. These factors raise substantial doubt about our ability to continue as a going concern. The financial statements included with this report do not include any adjustments that might result from the outcome of this uncertainty. In order for us to remove substantial doubt about our ability to continue as a going concern, we must achieve profitability, generate positive cash flows from operating activities and obtain necessary debt or equity funding.  

Our financial statements have been prepared on a going concern basis, which assumes continuity of operations and realization of assets and liabilities in the ordinary course of business. Our independent registered public accounting firm has issued its report dated March 19, 2024, which includes an explanatory paragraph stating that our recurring losses, among other things, raise substantial doubt about our ability to continue as a going concern. It has been necessary to rely upon debt and the sale of our equity securities to sustain operations. Our management anticipates that we may require additional capital over the next 12 months to fund ongoing operations. There can be no guarantee that we will be able to obtain such funds, or obtain them on satisfactory terms, and that such funds would be sufficient.    

Regulatory, Product Liability and Insurance Risks

Our products are subject to government regulation, both in the United States and abroad, which could increase our costs significantly and limit or prevent the sale of our products.

The manufacture, packaging, labeling, advertising, promotion, distribution and sale of our products are subject to regulation by numerous national and local governmental agencies in the United States and other countries. The primary regulatory bodies in the United States are the FDA and FTC, and we are also subject to similar regulatory bodies in all the countries in which we do business. Failure to comply with regulatory requirements may result in various types of penalties or fines. These include injunctions, product withdrawals, recalls, product seizures, fines and criminal prosecutions. Individual U.S. states also regulate nutritional supplements. A state may seek to interpret claims or products presumptively valid under federal law as illegal under that state's regulations. For example, in February 2015, the New York Attorney General issued cease and desist letters to several national retailers regarding certain herbal supplements and since that time both the New York Attorney General and other states Attorneys General have engaged in inquiries regarding the manufacture and sale of various supplements, and pursuant to such inquiries could seek to take actions against industry participants or amend applicable regulations in their State. In markets outside the United States, we are usually required to obtain approvals, licenses, or certifications from a country's ministry of health or comparable agency, as well as labeling and packaging regulations, all of which vary from country to country.

Approvals or licensing may be conditioned on reformulation of products or may be unavailable with respect to certain products or product ingredients. Any of these government agencies, as well as legislative bodies, can change existing regulations, or impose new ones, or could take aggressive measures, causing or contributing to a variety of negative consequences, including:

Any or all of these requirements could have a material adverse effect on us. There can be no assurance that the regulatory environment in which we operate will not change or that such regulatory environment, or any specific action taken against us, will not result in a material adverse effect on us.

If we experience regulatory investigations or product recalls, we may incur significant and unexpected costs, and our business reputation could be adversely affected.

We may be exposed to regulatory investigations or product recalls and adverse public relations if our products are alleged to cause injury or illness, or if we are alleged to have violated governmental regulations. A regulatory investigation or product recall could result in substantial and unexpected expenditures, which would reduce operating profit and cash flow. In addition, a regulatory investigation or product recall may require significant management attention. Regulatory investigations and product recalls may hurt the value of our brands and lead to decreased demand for our products. Regulatory investigations or product recalls also may lead to increased scrutiny by federal, state or international regulatory agencies of our operations and increased litigation and could have a material adverse effect on our business, results of operations, financial condition and cash flows. Regulatory investigations or product recalls could also result in our incurring substantial costs, losing revenues and implementing a change in the design, manufacturing process or the indications for which our products may be used, each of which could harm our business.

We may experience product liability claims and litigation to prosecute such claims, and although we maintain product liability insurance, which we believe to be adequate for our needs, there can be no assurance that our insurance coverage will be adequate or that we will be able to obtain adequate insurance coverage in the future. In addition, we may be subject to consumer fraud claims, including consumer class action claims regarding product labeling and advertising, and litigation to prosecute such claims; these claims are generally not covered by insurance.

As a manufacturer and a distributor of products for human consumption, we experience from time to time product liability claims and litigation to prosecute such claims. Additionally, the manufacturesale and saledistribution of these products involves the risk of injury to consumers as a result of tampering by unauthorized third parties or product contamination. We carry insurance coverage in the types and amounts that we consider reasonably adequate to cover the risks we face from product liability claims. If insurance coverage is inadequate or unavailable or premium costs continue to rise, we may face additional claims not covered by insurance, and claims that exceed coverage limits or that are not covered could have a material adverse effect on us. Moreover, liability claims arising from a serious adverse event may in addition to increasing our costs through higher insurance premiums and deductibles, may make it more difficult to secure adequate insurance coverage in the future. In addition, consumer fraud claims, including consumer class action claims regarding product labeling and advertising, are increasingly common as to food and dietary supplement products. Because insurance is generally not availablehard to obtain for such claims, these claims could have a material adverse effect on us. A product liability claim, regardless of its merit or ultimate outcome, could result in:

Item5.          Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market Information

Our common stock is traded in the OTC Markets PK (OTCPK),OTCPK, under the symbol "TLCC". We have been eligible to participate in the OTCPK since June 25, 2014 and from that time until the date of this Report our common stock has had only minimal trading. Over-the-counter market quotations of our common stock reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

Holders of Common Stock

As of March 31, 2017,15, 2024, there were approximately 348375 stockholders of record of our common stock. This number does not include shares held by brokerage clearing houses, depositories or others in unregistered form.

Dividends

We have not declared or paid any cash dividends on our common stock during our two most recent fiscal years. Any decisions regarding dividends will be made by our Board of Directors. We currently intend to retain and use any future earnings for the development and expansion of our business and do not anticipate paying any cash dividends in the foreseeable future. Our Board of Directors has complete discretion on whether to pay dividends. Even if our Board of Directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that the Board of Directors may deem relevant.

Item 6.          Selected Financial Data.

We are a smaller reporting company as defined by Regulation S-KThe following discussion and as such, we are not required to provideanalysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form10-K. Some of the information contained in this item pursuantdiscussion and analysis or set forth elsewhere in this Annual Report on Form10-K, including information with respect to Regulation S-K. 

Item 7.Management’s Discussionour plans and Analysisstrategy for our business, includes forward looking statements that involve risks and uncertainties. As a result of Financial Condition and Resultsmany factors, including those factors set forth in the ‘‘Risk Factors’’ section of Operations.
                        (Amounts in thousands, except per share amounts.)

Overview

Thisthis Annual Report on Form 10-K, contains forward-looking statements. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “believes,” “anticipates,” “plans,” “expects,” ‘intends” and similar expressions identify some of the forward-looking statements. Forward-looking statements are not guarantees of performance or future results and involve risks, uncertainties and assumptions. The factors discussed elsewhere in this Form 10-K and in subsequent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K, could also causeour actual results tocould differ materially from those indicatedthe results described in or implied by ourthese forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements.

Our OperationsOverview

We are an integrated manufacturer,formulator, marketer, distributor and retailer of branded nutritional supplements and other natural products sold to and through domestic health and natural food stores, mass market retailers, specialty stores retailers, on-line retailers and websites. Internationally, we market and distribute branded nutritional supplements and other natural products to and through health and natural product distributors and retailers.

Our products include vitamins, minerals, specialty supplements and sports nutrition products primarily under the Twinlab® (including the Twinlab® Fuel brand of sports nutrition products), Reserveage™Reserveage and ResVitale®ResVitale ® brands. We also manufactureformulate, market and sell diet and energy products under the Metabolife® and Re-Body® brandsbrand and a full line of herbal teas under the Alvita® brand. To accommodate consumer preferences, our products come in various formulations and delivery forms, including capsules, tablets, softgels, chewables, liquids, sprays, powders and whole herbs. These products are sold primarily through health and natural food stores and national and regional drug store chains,on-line retailers, supermarkets, and mass-market retailers.

We also perform contract manufacturing services for private label products.  Our contract manufacturing business involves the manufacture of custom products to the specifications of a customer who requires finished product under the customer’s own brand name.  We do not market these private label products as our business is to manufacture and sell the products to the customer, who then markets and sells the products to retailers or end consumers.

We manufacture and/or distribute one of the broadest branded product lines in the industry with approximately 260 stock77 stock keeping units, or SKUs. We believe that as a result of our emphasis on innovation, quality, loyalty, education and customer service, our brands are widely recognized in health and natural food stores and among their customers. In most periods since our formation, we have generated losses from operations.

We focused significantlyalso performed services between private label distributors and contract manufacturers under the NutraScience Labs ("NSL") brand name. NSL facilitated the production of new supplements to market and reformulates existing products to include scientifically-backed ingredients. We provided our customers with numerous production services, including manufacturing, testing, label and packaging design, order fulfillment, and regulatory compliance.

NSL facilitated the contract manufacture of a variety of high-quality vitamin and supplement products, including but not limited to, immune support supplements, cognitive support products, prebiotics and probiotics, supplements for weight management, and sports nutrition supplements. Our role in 2016the production of these products was to help our customers manufacture or reformulate dietary supplements for sale and distribution. We did this by working with contract manufacturers to build scientifically backed formulas for resale to our end customers. We also simplified the production process by providing quality control checks, storing inventory on integratingsite, labeling and designing finished products, and drop shipping finished products ready for sale to our two 2015 acquisitions. The first wasend customers. We did not market these private label products, but rather sold the acquisition ofproducts to the customer, relationships of Nutricap, a provider of dietary supplement contract manufacturing services, into our subsidiary, NutraScience, on February 6, 2015, and the secondwho was the acquisition of 100% of the equity interests of Organic Holdings, a market leader in the healthy aging and beauty from within categories and owner of the award-winning Reserveage™ Nutrition brand. We believe that both of these acquisitions significantly strengthened our product offerings, contract manufacturing services and our sales and marketing capabilities, providing us with opportunities to improve our market position. Consequently, the results of our operationsthen responsible for the year ended December 31, 2016 generally will not be comparablemarketing, distribution, and sale to retailers or to their end customers. 

In Q3 2023, due to history of operating losses associated with private label distributions business under NSL brand name, the Company has decided to cease operations associated with NSL. As such, NutraScience’s fixed assets were determined to have minimal economic value to the resultsCompany and were disposed of our operations for the year ended December 31, 2015.

Nutricap Asset Acquisition

In September 2014, we entered into an option agreement that gave us an exclusive option to purchase certain assets of Nutricap, a provider of dietary supplement contract manufacturing services. Pursuant to the agreement, dated and effective as of February 4, 2015, the acquisition of Nutricap’s customer relationships was consummated on February 6, 2015 by NutraScience. The purchase price paid for the acquired assets totaled $12,328, comprised of (i) $6,126 in cash ($8,000 less certain downward adjustments), (ii) deposit of $350 paid in 2014; (iii) assumption of certain liabilities of $1,874; and (iv) promissory notes in an aggregate principal amount of $3,978.

Organic Holdings Acquisition

In September 2014, we entered into an option agreement that gave us an exclusive option to purchase 100% of the outstanding equity interests of Organic Holdings, a marketer and distributor of nutritional products.  We paid $2,000 to acquire the option.  Effective August 13, 2015, TCC exercised the option and entered into a Unit Purchase Agreement,through abandonment concurrently with the owners of the membership interests of Organic Holdings. The parties subsequently agreed to extend the closing date of the Purchase Agreement to October 5, 2015. On October 5, 2015, TCC closed the transactions contemplated by the Purchase Agreement and TCC acquired all of the equity interests of Organic Holdings for a total purchase price of $41,710.ceased operation.

Going Concern Uncertainty

The accompanying consolidated financial statements have been prepared on a going concern basis, which assumes continuity of operations and realization of assets and liabilities in the ordinary course of business. SinceIn most periods since our formation, we have operated at a loss.generated losses from operations. At December 31, 2016,2023, we havehad an accumulated deficit of $224,472 and a total stockholders’ equity of $1,766. These losses were associated with start-up activities and brand and infrastructure development. Recently,$370.1 million. Historical losses are primarily attributable to lower than planned sales resulting from low fill rates on demand due to limitations of our working capital, delayed product introductions and postponed marketing activities, merger-related and other restructuring costs, and interest and refinancing charges associated with our debt refinancing.refinancing, and impairment of goodwill and intangible assets. Losses have been funded primarily through issuance of common stock and third-party or related party and third-party debt.

Because of thisour history of operating losses and significant interest expense on our debt, and the recording of significant derivative liabilities, we have a working capital deficiency of $4,050$140.1 million at December 31, 2016.2023. We also have significant$93.6 million of debt, due within the next 12 months.presented in current liabilities. These continuing conditions, among others, raise substantial doubt about the Company'sour ability to continue as a going concern.

Management has addressed operating issues through the following actions: focusing on growing the core business and brands; continuing emphasis on major customers and key products; reducing manufacturing and operating costs and continuing to negotiate lower prices from major suppliers. As of December 31, 2016, we had cash of $5,097, which we believe is insufficient for current operations. As set forth more fully in Note 16 to our consolidated financial statements, we obtained debt funding totaling $3,267 subsequent to December 31, 2016 to fund current operations. However, weWe believe that we maywill need additional capital to execute our business plan. If additional funding is required, thereThere can be no assurance that sources of funding will be available when needed on acceptable terms or at all.

The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Critical Accounting Policies and Estimates

ThisOur management’s discussion and analysis of our consolidated financial condition and results of operations isare based on our consolidated financial statements, which we have been prepared in accordance with the U.S. generally accepted accounting principles. The preparation of ourthese consolidated financial statements requiredrequires us to make judgments and estimates and assumptions that affectedaffect the reported amounts of assets, liabilities, revenues and liabilitiesexpenses and the disclosure of contingent assets and liabilities atin our consolidated financial statements. We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the dates of the financial statements and the reported amounts of net sales and expenses during the reported periods. Significant estimates include values and lives assigned to acquired intangible assets, reserves for customer returns and allowances, uncollectible accounts receivable, valuation adjustments for slow moving, obsolete and/or damaged inventory and valuation, recoverability of long-lived assets, intangibles and goodwill, estimated values of stock options and warrants, share-based compensation, and the identification and valuation of derivatives.circumstances. Actual results may differ from these estimates under different assumptions or conditions. On an ongoing basis, we evaluate our judgments and estimates in light of changes in circumstances, facts and experience. The effects of material revisions in estimates, if any, will be reflected in the financial statements prospectively from the date of change in estimates.

Our criticalWhile our significant accounting policies are described in more detail in the notes to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K, we believe the following accounting policies used in the preparation of our consolidated financial statements require the most significant judgments and estimates include the following:estimates.

Revenue Recognition

Revenue from product and service sales netand the related cost of estimatedsales are recognized when the performance obligations are satisfied. The performance obligations are typically satisfied upon shipment of physical goods or as the services are performed over time. In addition to the satisfaction of the performance obligations, the following conditions are required for revenue recognition: an arrangement exists, there is a fixed price, and collectability is reasonably assured. Discounts, returns and allowances is recognized when evidencerelated to sales, including an estimated reserve for the returns and allowances, are recorded as reduction of an arrangement is in place, related prices are fixed and determinable, contractual obligations have been satisfied, title and risk of loss have been transferred to the customer and collection of the resulting receivable is reasonably assured. Shipping terms are generally freight on board shipping point. We sell predominately in the North American and European markets, with international sales transacted in U.S. Dollars.revenue.

Accounts Receivable and Allowances

We grant credit to customers and generally do not require collateral or other security. We perform credit evaluations of our customers and provide for expected claims, related to promotional items; customer discounts; shipping shortages and damages; and doubtful accounts based upon historical bad debt and claims experience.

Inventories

Inventories are stated at the standardlower of cost or net realizable value and are reduced by an estimated reserve for obsolete inventory.

ImpairmentValue of Long-Lived AssetsWarrants Issued with Debt

Long-lived assets, including intangible assets subject to amortization,We estimate the grant date value of certain warrants issued with debt using a valuation method, such as the Black-Scholes option pricing model, or, if the terms are reviewed for impairment when changes in circumstances indicate thatmore complex, using an outside professional valuation firm, which uses the carrying amountMonte Carlo option lattice model. We record the amounts as interest expense or debt discount, depending on the terms of the asset may not be recoverable. Ifagreement. These estimates involve multiple inputs and assumptions, including the carrying amountmarket price of the asset exceeds the expected undiscounted cash flows of the asset, an impairment charge is recognized equal to the amount by which the carrying amount exceeds fair value. The testing of these intangibles under established guidelines for impairment requires significant use of judgment and assumptions. Changes in forecasted operationsCompany’s common stock, stock price volatility and other assumptions could materially affect the estimated fair values. Changes in business conditions could potentially require adjustments to these asset valuations.

Intangible Assets

Intangible assets consist primarily of trademarksproject earnings before interest, taxes, depreciation and customer relationships, whichamortization (“EBITDA”) and other reset events. These inputs and assumptions are amortized on a straight-line basis over their estimated useful lives ranging from 3subject to 30 years. The valuation and classification of these assets and the assignment of amortizable lives involve significantmanagement’s judgment and can vary materially from period to period.

Share-Based Compensation

We record share-based compensation, including grants of restricted stock units, based on their grant date fair values and record compensation expense over the usevesting period of estimates.the restricted stock awards.

We believe that our long-term growth strategy supports our fair value conclusions. For intangible assets, the recoverability of these amounts is dependent upon achievement of our projections and the execution of key initiatives related to revenue growth and improved profitability.

Goodwill

Goodwill is not amortized, but tested for impairment on an annual basis at the end of our fiscal year and at an interim date if indicators of impairment exist.

Income Taxes

We account for income taxes using an asset and liability approach. Deferred income taxes are determined by applying currently enacted tax laws and rates to the cumulative temporary differences between the carrying values of assets and liabilities for financial statement and income tax purposes. Valuation allowances against deferred income tax assets are recorded when we are unable to conclude that it is more likely than not that such deferred income tax assets will be realized.

Value of Warrants Issued with Debt

We estimate the grant date value of certain warrants issued with debt, using an outside professional valuation firm, which uses the Monte Carlo option lattice model. We recordthe amounts as interest expense or debt discount, depending on the terms of the agreement. These estimates involve multiple inputs and assumptions, including the market price of the Company’s common stock, stock price volatility and other assumptions to projectearnings before interest, taxes, depreciation and amortization (“EBITDA”) and other reset events. These inputs and assumptions are subject to management’s judgment and can vary materially from period to period.

Share-Based Compensation

We record share-based compensation, including grants of restricted stock units, based on their grant date fair values and record compensation expense over the vesting period of the restricted stock awards.

Derivative Liabilities

We have recorded certain warrants as derivative liabilities at estimated fair value, as determined based on our use of an outside professional valuation firm, due to the variable terms of the warrant agreements. The value of the derivative liabilities is generally estimated using Monte Carlo option lattice model with multiple inputs and assumptions, including the market price of our common stock, stock price volatility and other assumptions to project EBITDA and other reset events. These inputs and assumptions are subject to management’s judgment and can vary materially from period to period. 

Results of Operations

Our consolidated financial statements include the accountsThe following table summarizes our results of TCH and its subsidiaries, with all intercompany transactions and balances eliminated in consolidation. Our consolidated financial statementsoperations for the years ended December 31, 20162023 and 2015 include the operations of Nutricap from the acquisition date of February 6, 2015 and the operations of Organic Holdings from its acquisition date of October 5, 2015. Therefore, the results ofDecember 31, 2022:

Net Sales

The decrease in our operationsnet sales by 21% for the year ended December 31, 2016 generally will not be comparable2023 compared to the results2022, is primarily due to production backlogs at manufacturers, resulting in extended lead-time for production and fulfillment of sales, as well as a reduction in demand from some of our operationsmajor customers and retailers for some of our branded products.

Gross Profit

Our overall gross profit decrease of 39% for the year ended December 31, 2015.2023 compared to 2022, is primarily due to reduced demand from some of our major customers and increased product input costs at the supplier and manufacturing levels.

Net SalesSelling Expenses

Our net sales increased $4,651, or 6%, to $86,323selling expenses decreased by 56% for the year ended December 31, 2016 from $81,6722023 compared to 2022, primarily due to the reduction of certain advertising costs, such as marketing consultants and brand ambassadors as we did not have a major product launch in 2023 as occurred in the prior year. 

General and Administrative Expenses

Our general and administrative expenses decreased by 25% for the year ended December 31, 2015. The increases2023 compared to 2022, primarily due to modifications to staffing levels resulting in decreased salary costs, as well as a reduction in other costs such as insurance, made by proactively assessing all costs and ensuring that expenses are right-sized for a leaner company.

Impairment of Goodwill and Intangible Assets

Due to the immaterial net book value of our net sales reflectremaining intangible assets, annual impairment testing was not performed nor was an impairment loss recognized in 2023. During the acquisitionfourth quarter of Organic Holdings on October 5, 2015fiscal 2022, we completed our annual impairment test of goodwill and the acquisitionintangible assets and recognized impairment of the Nutricap customer relationships on February 6, 2015. Without the 2015 acquisitions, our net sales would have decreased$0.3 million as of December 31, 2022.

Interest Expense, Net

Our interest expense increased by $0.4 million or 5% for the year ended December 31, 20162023 compared to 2022. The increase is primarily due to rising interest rates on existing debt. 

Other Income

The decrease in partother income of 98% is related to operating cash constraints and the decision to exit certain lower margin, private label contract manufacturing.

Gross Profit

Our gross profit increased $9,504, or 82%, to $21,093,forgiveness of our remaining PPP Loans in 2022. Other income for the year ended December 31, 2016 from $11,589 for the year ended December 31, 2015. The increases in our gross profit reflect the gross profit contributed by our 2015 acquisitions.

Selling, General and Administrative Expenses

Our selling, general and administrative expenses increased $7,931, or 31%, to $33,452 for the year ended December 31, 2016 from $25,521 for the year ended December 31, 2015. The increases in our selling, general and administrative expenses reflect incremental expenses from our 2015 acquisitions. Without the 2015 acquisitions, our selling, general and administrative expenses would have remained relatively unchanged however $1,378 of total expense was due to our severance package2023 related to office relocation and $1,244 was related to Employee Stock Compensation expense.the sale of certain domain names no longer in use. 

Loss on Stock Purchase Price Guarantee

On August 6, 2016, the 18-month anniversary of the closing of a share purchase agreement, we were required to pay the purchaser of the common stock the difference between $2.29 per share and either a defined market price or a price per share determined by a valuation firm acceptable to both parties. Based on an outside professional valuation performed on the Company’s common stock, we estimated the stock price guarantee payment to be $3,210. Accordingly, we recorded a loss on the stock purchase price guarantee of $3,210 during the year ended December 31, 2016 and a corresponding liability for the same amount as of December 31, 2016, which is included in accrued expenses and other current liabilities in the accompanying condensed consolidated balance sheets. As of the filing date of this Form 10-K, we have not yet paid the liability to the purchaser and we are negotiating with the purchaser on extending the payment date. We cannot provide any assurance that it will be successful in negotiating an extension of the payment date. If we are not successful, the purchaser may sue the company for breach of contract.

Interest Expense, Net

Our interest expense increased $1,847, or 26%, to $8,848 for the year ended December 31, 2016 from $7,001 for year ended December 31, 2015. The increase in interest expense is due primarily to interest on new debt incurred in 2015 to complete the Nutricap and Organic Holdings acquisitions and new debt incurred in 2016, including the amortization of related debt discounts.

Gain (Loss) on Change in Derivative Liabilities

The number of shares of common stock issuable pursuant to certain warrants issued in 2015 will be increased if our audited adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) or the market price of the Company’s common stock do not meet certain defined amounts. We have recorded the estimated fair value of the warrants as of the date of issuance. Due to the variable terms of the warrant agreements, changes in the estimated fair value of the warrants from the date of issuance to each balance sheet reporting date are recorded as derivative liabilities with a corresponding charge to our consolidated statements of comprehensive income (loss). During the year ended December 31, 2016, we reported a gain on change in derivative liabilities of $24,661. During the year ended December 31, 2015, we reported a loss on change in derivative liabilities of $15,951.

Liquidity and Capital Resources

At December 31, 2016,2023, we had an accumulated deficit of $224,472,$370.1 million primarily because of our history of operating losses and our recording of derivative liabilities and loss on stock purchase guarantee.losses. We havehad a working capital deficiency of $4,050at$140.1 million at December 31, 2016.2023. Losses have been funded primarily through the issuance of common stock and warrants, borrowings from our stockholders and third-party debt and proceeds from the exercise of warrants.debt. As of December 31, 2016,2023, we had cash of $5,097. $19 thousand. On an ongoing basis, we also seek to improve operating cash through trade receivables and payables management as well as inventory stocking levels. WeNet cash used net cash in operating activities of $25,330 for the year endedDecember 31, 2016.2023 was $2.9 million. During the year ended December 31, 2016,2023, we incurred new debt of $29,270 and net increase in borrowings onfrom our seniorrevolving credit facility of $3,479 to fund our operations and debt repayment of $3,442. $3.6 million.

Our total liabilities increased by $4,589$1.8 million to $91,060 $148.0 million at December 31, 20162023 from $86,471$146.2 million at December 31, 2015.2022. This increase in our total liabilities was primarily due to a netthe increase of $33,194$0.6 million in debt, principally due to new debt financings obtained during 2016 offset by a decreaseaccrued interest and $0.4 in our non-cash derivative liabilities of $26,636 and liabilities related to operations of $5,016,accounts payable, partially offset by an increase of $3,210$0.2 million in liability on stock purchase guarantee. For discussion of our debt financings completed to date during 2016, see Notes 8accrued expenses and 9 in the Notes to Consolidated Financial Statements included in this Report.other current liabilities.

Cash Flows from Operating, Investing and Financing Activities

Net cash used in operating activities was $25,330$2.9 million for the year ended December 31, 20162023 as a result of our net loss of $684, a non-cash gain on change in derivative liabilities of $24,661 as well as $13.7 million, other net non-cash expenses totaling $11,076$0.1 million net, and an increase in net operating assets and liabilities of $11,061.$2.8 million. By comparison, for the year ended December 31, 2015,2022, net cash used in operating activities was $1,959$4.3 million as a result of our net loss of $36,410, $8.2 million, forgiveness of PPP loan of $1.7 million,a non-cash loss on change in derivative liabilitiesimpairment of $15,951, a non-cash gain on sale ofgoodwill and intangible assets of $750 as well as  $0.3 million, other non-cash expenses of $6,869totaling $1.1 million net, and a net decreasean increase in net operating assets and liabilities of $12,381. See Consolidated Statements of Cash Flows included in this Report for additional information.$4.2 million.

Net cash used in investingfinancing activities was $3.7 million for the year ended December 31, 2016 was $120,2023, consisting of the purchasenet payments of property and equipment. Net cash used in investing activities for the year ended December 31, 2015 was $46,356, consisting of cash paid in the Nutricap acquisition of $45,692 and the purchase of property and equipment of $2,022, partially offset by proceeds from the sale of assets of $988 and cash provided by change in restricted cash of $370.

$3.6 million under our revolving credit facility. Net cash provided by financing activities was $29,307$1.6 million for the year ended December 31, 2016, primarily2022, consisting of proceeds from the issuance of debt of $29,270, net borrowings of $3,479 underon our revolving credit facilities, partially offset by repaymentfacility of $1.6 million. 

Ongoing Funding Requirements

As set forth above, we obtained additional debt of $3,442. Net cash provided by financing activities was $49,118 forin the year ended December 31, 2015, primarily consisting of proceeds2023 to support operations. We will need additional funding from the exercise of warrants of $6,066, proceeds from the issuance of common stock of $40,497, proceeds from the issuance of debt of $8,499, a reduction in stock subscriptions receivable of $70 and a decrease in security deposits of $75, partially offset by repayment of debt of $5,148 and net repayments under our revolving credit facilitiesfacility to continue supporting our operations during the next twelve months. However, we cannot predict whether future borrowings will be available to us under our credit facility and future developments associated with the current economic environment will materially affect our long-term liquidity position.

In response to COVID-19 and to protect our liquidity and cash position, we have taken a number of steps. In August of 2020, we obtained deferment letters from each of Great Harbor (defined below), Little Harbor (defined below) and Golisano Holdings (defined below) pursuant to which each lender agreed to defer all payments due under outstanding notes held by each lender through October 22, 2021 and agreed to refrain from declaring a default and/or exercising any remedies under the outstanding notes. Amendments to extend the maturity date and related payment deferrals of the aforementioned notes have not been executed and these notes are currently in default. We continue to anticipate extending the maturity dates and related payment deferrals with the lending parties, but we cannot guarantee that such extensions and payment deferrals will be successfully obtained on a timely basis or at all.

On May 7, 2020, TCC, the operating subsidiary of debt issuance coststhe Company, received the proceeds of $941.a loan from Fifth Third Bank, National Association in the amount of $1.7 million obtained under the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which was enacted March 27, 2020 (the "PPP Loan”). The PPP Loan, evidenced by a promissory note dated May 5, 2020 (the “Note”), had a two-year term and bore interest at a rate of 1.0% per annum, with the monthly principal and interest payments due beginning December 1, 2020. TCC used the proceeds of the PPP Loan for payroll, office rent, and utilities which allowed the Company to seek forgiveness of this loan. The Company submitted its application for 100% forgiveness for this loan in November 2021.In January 2022,the full amount of the PPP Loan was forgiven by the Small Business Administration ("SBA"). As a result, the Company recorded a gain on the forgiveness of the loan in the amount of $1.7 million.

Ongoing Funding RequirementsOn January 25, 2021, TCC applied for another PPP loan with Fifth Third Bank in the amount of $1.3 million (the "Second PPP Loan”). The Second PPP Loan, evidenced by a promissory note dated February 5, 2021 (the "Second PPP Note”), had a two-year term and bore interest at a rate of 1.0% per annum, with expected monthly principal and interest payments that were due to begin September 1, 2021. TCC used the proceeds of the Second PPP Loan for payroll, which allowed the Company to seek forgiveness for this loan. The Company submitted its application for 100% forgiveness for this loan in November 2021. In December 2021, the full amount of the Second PPP Loan was forgiven by the SBA. As a result, the Company recorded a gain on the forgiveness of the loan in the amount of $1.3 million.

As set forth above, in 2016 we obtained an increase in debt financing to support operations. It is possible that we may need additional funding to enable us to fund additional operating expenses and capital expenditure requirements.

Until such time, if ever, thatas we can generate substantial product revenues, we intend to finance our cash needs through a combination of equity offerings, debt financings,financing, collaborations, strategic alliances and licensing arrangements. There can be no assurance that any of those sources of funding will be available when needed on acceptable terms or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of existing stockholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise funds through collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or market product candidates or to grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financingsfinancing or relationships with third parties when needed or on acceptable terms, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts; or grant rights to others to develop and market productsproduct candidates that we would otherwise prefer to develop and market ourselves.

Recent Accounting Pronouncements

In January 2017,March 2020, the FASBFinancial Accounting Standards Board ("FASB") issued ASU No. 2017-04, “Simplifying the Test for Goodwill Impairment2020-04, Reference Rate Reform (Topic 350)” which removes Step 2848): Facilitation of the goodwill impairment testEffects of Reference Rate Reform on Financial Reporting. ASU 2020-04 provides optional guidance to companies to ease the potential burden associated with transitioning away from reference rates that requires a hypothetical purchase price allocation.  A goodwill impairment will noware expected to be the amount by which a reporting unit’s carrying value exceeds its fair value, notdiscontinued. The new guidance provides optional expedients and exceptions to exceed the carrying amount of goodwill.  The amendments inapply GAAP to contract modifications and hedging relationships, subject to certain criteria, that reference London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued. We adopted this ASU are effective for fiscal years beginning afterprospectively on December 15, 2019.  Early14, 2022, on one of our Term Loan Notes and Agreements which was amended on this date to transition from LIBOR to the Secured Overnight Financing Rate ("SOFR"). The adoption is permitted after January 1, 2017.  We doof this ASU did not expect the new guidance to have a significantmaterial impact on our consolidated financial statements or related disclosures.statements.

In AugustJune 2016, the FASB issued ASU No. 2016-15, “Statement2016-13, Financial Instruments- Credit losses (Topic 326): Measurement of Cash Flows (Topic 230)”, which clarifiesCredit losses on Financial Instruments. ASU 2016-13 requires an organization to measure all expected credit losses for financial assets held at the classificationreporting date based on historical experience, current conditions, and reasonable and supportable forecasts. We adopted this standard prospectively on the first day of certain cash receipts and payments in the statementour 2023 fiscal year. The adoption of cash flows. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2017, including interim periods. We dostandard did not expect the new guidance to have a significantmaterial impact on our consolidated financial statements or related disclosures.statements.

In March 2016, the FASB issued ASU No. 2016-09, “Stock Compensation (Topic 718)”, which is intended to simplify several aspects of the accounting for share-based payment award transactions, including the income tax impacts, the classification on the statement of cash flows, and forfeitures. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim periods. We have not yet determined the impact on our consolidated financial statements of the adoption of this new accounting pronouncement.

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases (Topic 842)”. The amendments in this ASU revise the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2018 and are to be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. We have not yet determined the impact on our consolidated financial statements of the adoption of this new accounting pronouncement.

Although there are several other new accounting pronouncements issued or proposed by the FASB, which we have adopted or will adopt, as applicable, we do not believe any of these accounting pronouncements hashave had or will have a material impact on our consolidated financial position or results of operations.

In May 2014, August

Material Contractual Obligations

As of December 31, 2023, we had total debt of $93.6 million, of which $90.8 million is considered to be related-party debt. For discussion of our debt financing, see Notes 6 and 7 in the Notes to Consolidated Financial Statements included in this report.

Effective April 7, 2015, we entered into an operating lease agreement for approximately31,000square feet of office space in St. Petersburg, Florida (the "St. Petersburg Lease"). The agreement expires in April 2027 and Mayhas a monthly base rent of $59thousand for year1to $76thousand for year12.