Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 22, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 001-32501 | ||
Entity Registrant Name | REED’S, INC. | ||
Entity Central Index Key | 0001140215 | ||
Entity Tax Identification Number | 35-2177773 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Address, Address Line One | 201 Merritt 7 | ||
Entity Address, City or Town | Norwalk | ||
Entity Address, State or Province | CT | ||
Entity Address, Postal Zip Code | 06851 | ||
City Area Code | (800) | ||
Local Phone Number | 997-3337 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | REED | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 55,025,154 | ||
Entity Common Stock, Shares Outstanding | 86,403,321 |
Balance Sheets
Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash | $ 595 | $ 913 |
Accounts receivable, net of allowance of $234 and $375, respectively | 4,718 | 2,099 |
Receivable from related party | 682 | 356 |
Inventory, net of reserve for obsolescence of $194 and $646, respectively | 11,119 | 10,508 |
Prepaid expenses and other current assets | 1,341 | 420 |
Total current assets | 18,455 | 14,296 |
Property and equipment, net of accumulated depreciation of $361 and $482, respectively | 920 | 1,053 |
Equipment held for sale, net of impairment reserves of $96 and $96, respectively | 67 | 67 |
Intangible assets | 615 | 576 |
Total assets | 20,057 | 15,992 |
Current liabilities: | ||
Accounts payable | 6,746 | 5,357 |
Payable to related party | 557 | 182 |
Accrued expenses | 895 | 646 |
Revolving line of credit | 3,177 | |
Current portion of note payable | 599 | |
Current portion of lease liabilities | 130 | 49 |
Total current liabilities | 8,927 | 9,411 |
Lease liabilities, less current portion | 555 | 737 |
Note payable, less current portion | 171 | |
Convertible note to a related party | 4,689 | |
Warrant liability | 0 | 8 |
Total liabilities | 9,653 | 14,845 |
Stockholders’ equity: | ||
Series A Convertible Preferred stock, $10 par value, 500,000 shares authorized, 9,411 shares issued and outstanding | 94 | 94 |
Common stock, $.0001 par value, 120,000,000 and 100,000,000 shares authorized, respectively; 86,317,096 and 47,595,206 shares issued and outstanding, respectively | 9 | 5 |
Additional paid in capital | 97,031 | 77,596 |
Accumulated deficit | (86,730) | (76,548) |
Total stockholders’ equity | 10,404 | 1,147 |
Total liabilities and stockholders’ equity | $ 20,057 | $ 15,992 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowance | $ 234 | $ 375 |
Inventory Valuation Reserves | 194 | 646 |
Property and equipment, accumulated depreciation | $ 361 | $ 482 |
Series A convertible preferred stock, par value | $ 10 | $ 10 |
Series A convertible preferred stock, shares authorized | 500,000 | 500,000 |
Series A convertible preferred stock, shares issued | 9,411 | 9,411 |
Series A convertible preferred stock, shares outstanding | 9,411 | 9,411 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 120,000,000 | 100,000,000 |
Common stock, shares outstanding | 86,317,096 | 47,595,206 |
Common stock, shares issued | 86,317,096 | 47,595,206 |
Statements of Operations
Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||
Net Sales | $ 41,615 | $ 33,820 |
Cost of goods sold | 28,849 | 25,944 |
Gross profit | 12,766 | 7,876 |
Operating expenses: | ||
Delivery and handling expense | 6,856 | 5,993 |
Selling and marketing expense | 7,503 | 9,188 |
General and administrative expense | 7,023 | 7,551 |
Total operating expenses | 21,382 | 22,732 |
Loss from operations | (8,616) | (14,856) |
Loss on extinguishment of debt | (262) | |
Interest expense | (1,307) | (1,286) |
Change in fair value of warrant liability | 8 | 30 |
Net loss | (10,177) | (16,112) |
Dividends on Series A Convertible Preferred Stock | (5) | (5) |
Net loss attributable to common stockholders | $ (10,182) | $ (16,117) |
Loss per share – basic and diluted | $ (0.17) | $ (0.46) |
Weighted average number of shares outstanding – basic and diluted | 60,644,842 | 35,058,004 |
Statements of Changes in Stockh
Statements of Changes in Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance | 25,729,461 | 9,411 | |||
Beginning balance, value at Dec. 31, 2018 | $ 3 | $ 94 | $ 53,591 | $ (60,431) | $ (6,743) |
Beginning balance at Dec. 31, 2018 | 25,729,461 | 9,411 | |||
Beginning balance | 47,595,206 | 9,411 | |||
Fair value of vested options | 790 | 790 | |||
Fair value of vested restricted shares granted to Directors for services | 132 | 132 | |||
Fair value of vested restricted shares granted to Directors for services, shares | 46,035 | ||||
Fair value of vested restricted shares granted to a former officer for services | 374 | 374 | |||
Fair value of vested restricted shares granted to a former officer for services, shares | 442,002 | ||||
Dividends on Series A Convertible Preferred Stock | 5 | (5) | |||
Dividends on Series A Convertible Preferred Stock, shares | 4,254 | ||||
Common shares issued pursuant to the rights offerings, net of offering costs | $ 2 | 22,339 | 22,341 | ||
Common shares issued pursuant to the rights offering, net of offering costs, shares | 21,150,417 | ||||
Exercise of warrants | 365 | 365 | |||
Exercise of warrants, shares | 223,037 | ||||
Net Loss | (16,112) | (16,112) | |||
Ending balance, value at Dec. 31, 2019 | $ 5 | $ 94 | 77,596 | (76,548) | 1,147 |
Ending balance at Dec. 31, 2019 | 47,595,206 | 9,411 | |||
Beginning balance | 47,595,206 | 9,411 | |||
Beginning balance | 86,317,096 | 9,411 | |||
Fair value of vested options | 1,176 | 1,176 | |||
Fair value of vested restricted shares granted to Directors and officers for services | 416 | 416 | |||
Fair value of vested restricted shares granted to Directors and officers for services, shares | 444,740 | ||||
Dividends on Series A Convertible Preferred Stock | 5 | (5) | |||
Dividends on Series A Convertible Preferred Stock, shares | 4,530 | ||||
Common shares issued pursuant to the rights offerings, net of offering costs | $ 4 | 16,560 | 16,564 | ||
Common shares issued pursuant to the rights offering, net of offering costs, shares | 36,895,834 | ||||
Fair value of warrants issued on extinguishment of debt | 402 | 402 | |||
Common shares issued on conversion of note payable | 857 | 857 | |||
Common shares issued on conversion of note payable, shares | 1,339,286 | ||||
Exercise of options | 19 | 19 | |||
Exercise of options, shares | 37,500 | ||||
Net Loss | (10,177) | (10,177) | |||
Ending balance, value at Dec. 31, 2020 | $ 9 | $ 94 | $ 97,031 | $ (86,730) | $ 10,404 |
Ending balance at Dec. 31, 2020 | 86,317,096 | 9,411 | |||
Beginning balance | 86,317,096 | 9,411 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (10,177) | $ (16,112) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 88 | 61 |
Gain on sale of property & equipment | (45) | |
Loss on termination of leases | 8 | |
Loss on extinguishment of debt | 262 | |
Amortization of debt discount | 452 | 323 |
Amortization of right of use assets | 116 | 91 |
Fair value of vested options | 1,176 | 790 |
Fair value of vested restricted shares granted to directors and officers for services | 416 | 506 |
Decrease in accounts receivable allowance | (141) | (248) |
Increase (decrease) in inventory reserve | (452) | 449 |
Decrease in fair value of warrant liability | (8) | (30) |
Accrual of interest on convertible note to a related party | 558 | 528 |
Lease liability | (28) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,478) | 757 |
Inventory | (159) | (3,575) |
Prepaid expenses and other assets | (759) | (645) |
Accounts payable | 1,390 | (182) |
Accrued expenses | 248 | (837) |
Net cash used in operating activities | (9,496) | (18,161) |
Cash flows from investing activities: | ||
Intangible asset trademark costs | (39) | |
Proceeds from sale of property and equipment | 45 | |
Purchase of property and equipment | (122) | (322) |
Net cash used in investing activities | (161) | (277) |
Cash flows from financing activities: | ||
Borrowings under revolving line of credit | 50,975 | 54,831 |
Repayments of revolving line of credit | (54,636) | (58,827) |
Capitalization of financing costs | (130) | (130) |
Proceeds from loan payable | 770 | |
Amounts from related party | 49 | 195 |
Repayment of convertible note payable | (4,250) | |
Principal repayments on finance lease obligation | (22) | (48) |
Exercise of options | 19 | |
Exercise of warrants | 365 | |
Proceeds from sale of common stock | 16,564 | 22,341 |
Net cash provided by financing activities | 9,339 | 18,727 |
Net increase (decrease) in cash | (318) | 289 |
Cash at beginning of period | 913 | 624 |
Cash at end of period | 595 | 913 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 1,740 | 498 |
Non-cash investing and financing activities: | ||
Offset accounts receivable related party and accounts payable related party | 153 | |
Dividends on Series A Convertible Preferred Stock | $ 5 | $ 5 |
Operations and Liquidity
Operations and Liquidity | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Operations and Liquidity | 1. Operations and Liquidity Reed’s Inc. (the “Company”) is the owner and maker of both Reed Craft Ginger Beer and Reed’s Real Ginger Ale and Virgil’s Handcrafted Sodas. Established in 1989, Reed’s is America’s best-selling Ginger Beer brand and has been the leader and innovator in the ginger beer category for decades. Virgil’s is America’s best-selling independent, full line of natural craft sodas. The Reed’s Inc. portfolio is sold in over 40,000 retail stores nationwide. Reed’s Ginger Beers are unique due to the proprietary process of using fresh ginger root combined with a Jamaican inspired recipe of natural spices and fruit juices. Reed’s uses this same handcrafted approach in its Reed’s Real Ginger Ale and Virgil’s line of great tasting, bold flavored craft sodas, including its award-winning Virgil’s Root Beer. COVID-19 Considerations During the year ended December 31, 2020, the COVID-19 pandemic did not have a material net impact on our operating results. In the future, the pandemic may cause reduced demand for our products if, for example, the pandemic results in a recessionary economic environment which negatively effects the consumers who purchase our products. Based on the recent increase in demand for our products, we believe that over the long term, there will continue to be strong demand for our products. Our ability to operate without significant negative operational impact from the COVID-19 pandemic will in part depend on our ability to protect our employees and our supply chain. The Company has endeavored to follow the recommended actions of government and health authorities to protect our employees. Since the inception of the COVID-19 pandemic and through the year ended December 31, 2020, we maintained the consistency of our operations during the onset of the COVID-19 pandemic. We will continue to innovate in managing our business, coordinating with our employees and suppliers to do our part in the infection prevention and remain flexible in responding to our customers and suppliers. However, the uncertainty resulting from the pandemic could result in an unforeseen disruption to our workforce and supply chain (for example an inability of a key supplier or transportation supplier to source and transport materials) that could negatively impact our operations. Through December 31, 2020, the COVID-19 pandemic has not negatively impacted the Company’s liquidity position as of such date. Net sales for the year ended December 31, 2020 were up 23% from the prior year period. Through December 31, 2020, we continue to generate cash flows to meet our short-term liquidity needs, and we expect to maintain access to the capital markets. We have also not observed any material impairments of our assets or a significant change in the fair value of our assets due to the COVID-19 pandemic. Liquidity The accompanying financial statements have been prepared under the assumption that the Company will continue as a going concern. Such assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the year ended December 31, 2020, the Company recorded a net loss of $ 10,177 and used cash in operations of $ 9,496 . As of December 31, 2020, we had a cash balance of $ 595 with borrowing capacity of $ 5,166 , stockholders’ equity of $ 10,404 and a working capital of $ 9,528 . Notwithstanding the net loss for 2020, management projects adequate cash from operations and available line of credit in 2021 to ensure continuation of the Company as a going concern for at least one year from the date the Company’s 2020 financial statements are issued. During 2020, the Company conducted public offerings and sold 36.9 16,564 Historically, we have financed our operations through public and private sales of common stock, issuance of preferred and common stock, convertible debt instruments, term loans and credit lines from financial institutions, and cash generated from operations. We have taken decisive action to improve our margins, including fully outsourcing our manufacturing process, streamlining our product portfolio, negotiating improved vendor contracts and restructuring our selling prices. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Those estimates and assumptions include estimates for reserves of uncollectible accounts receivables, assumptions used in valuing inventories at net realizable value, impairment testing of recorded long-term tangible and intangible assets, the valuation allowance for deferred tax assets, accruals for potential liabilities, assumptions made in valuing stock instruments issued for services, and assumptions used in valuing warrant liabilities, and assumptions used in the determination of the Company’s liquidity. Accounts Receivable Accounts receivable are generally recorded at the invoiced amounts net of an allowance for expected losses. The Company evaluates the collectability of its trade accounts receivable based on a number of factors. In circumstances where the Company becomes aware of a specific customer’s inability to meet its financial obligations to the Company, a specific reserve for bad debts is estimated and recorded, which reduces the recognized receivable to the estimated amount the Company believes will ultimately be collected. In addition to specific customer identification of potential bad debts, bad debt charges are recorded based on the Company’s historical losses and an overall assessment of past due trade accounts receivable outstanding. The allowance for accounts receivable is established through a provision reducing the carrying value of receivables. At December 31, 2020 and 2019, the allowance was $ 234 and $ 375 , respectively. Inventory Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out (“FIFO”) basis. We regularly review our inventory quantities on hand and record a provision for excess and obsolete inventory based primarily on our estimated forecast of product demand and our ability to sell the product(s) concerned. Demand for our products can fluctuate significantly. Factors that could affect demand for our products include unanticipated changes in consumer preferences, general market conditions or other factors, which may result in cancellations of advance orders or a reduction in the rate of reorders placed by customers. Additionally, our management’s estimates of future product demand may be inaccurate, which could result in an understated or overstated provision required for excess and obsolete inventory. At December 31, 2020 and 2019, the reserve for inventory obsolescence aggregated $ 194 646 Property and Equipment Property and equipment is stated at cost. Expenditures for major renewals and improvements that extend the useful lives of property and equipment or increase production capacity are capitalized, and expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is calculated using accelerated and straight-line methods over the estimated useful lives of the assets as follows: Schedule of Estimated Useful Lives of Property and Equipment and Related Depreciation Property and Equipment Type Years of Depreciation Computer hardware and software 3 7 Machinery and equipment 5 Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. For the years ended December 31, 2020 and 2019, the Company determined there were no indicators of impairment of its property and equipment. Intangible Assets Intangible assets are comprised of indefinite-lived brand names acquired, so classified because we anticipate that these brand names will contribute cash flows to the Company perpetually. Indefinite-lived intangible assets are not amortized but are assessed for impairment annually, or more frequently if events or circumstances indicate that assets might be impaired, and evaluated annually to determine whether the indefinite useful life is appropriate. As part of our impairment test, we first assess qualitative factors to determine whether it is more likely than not the asset is impaired. If further testing is necessary, we compare the estimated fair value of our asset with its book value. If the carrying amount of the asset exceeds its fair value, as determined by its discounted cash flows, an impairment loss is recognized in an amount equal to that excess. For the years ended December 31, 2020 and 2019, the Company determined there was no impairment of its indefinite-lived brand names. Warrant Liabilities Various stock sales made by the Company to finance operations have been accompanied by the issuance of warrants. Some of these warrant agreements contain fundamental transaction provisions which may give rise to an obligation of the Company to pay cash to the warrant holders in the event that a fundamental transaction occurs (such as a merger or change in control of the Company) and such cash payment is elected by the holder. For accounting purposes, in accordance with ASC 480, Distinguishing Liabilities from Equity Fair value is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect the amount of expense recorded in future periods. Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs upon shipment from our facilities. The Company’s performance obligations are satisfied at that time. The Company does not have any significant contracts with customers requiring performance beyond delivery, and contracts with customers contain no incentives or discounts that could cause revenue to be allocated or adjusted over time. Shipping and handling activities are performed before the customer obtains control of the goods and therefore represent a fulfillment activity rather than a promised service to the customer. All of the Company’s products are offered for sale as finished goods only, and there are no performance obligations required post-shipment for customers to derive the expected value from them. The Company does not allow for returns, except for damaged products when the damage occurred pre-fulfillment. Damaged product returns have historically been insignificant. Because of this, the stand-alone nature of our products, and our assessment of performance obligations and transaction pricing for our sales contracts, we do not currently maintain a contract asset or liability balance for obligations. We assess our contracts and the reasonableness of our conclusions on a quarterly basis. Cost of Goods Sold Cost of goods sold is comprised of the costs of raw materials and packaging utilized in the manufacture of products, co-packing fees, repacking fees, in-bound freight charges, as well as certain internal transfer costs. Additionally, cost of goods sold includes direct production costs in excess of charges allocated to finished goods in production. Plant costs include labor costs, production supplies, repairs and maintenance, depreciation, direct inventory write-off charges and adjustments to the inventory reserve. Charges for labor and overhead allocated to finished goods are determined on a market cost basis, which may be lower than the actual costs incurred. Plant costs in excess of production allocations are expensed in the period incurred rather than added to the cost of finished goods produced. Expenses not related to the production of our products are classified as operating expenses. Delivery and Handling Expense Shipping and handling costs are comprised of purchasing and receiving, inspection, warehousing, transfer freight, and other costs associated with product distribution after manufacture and are included as part of operating expenses. Advertising Costs Advertising costs are expensed as incurred and are included in selling and marketing expense. Advertising costs aggregated $ 1,518 2,570 Stock Compensation Expense The Company periodically issues stock options and restricted stock awards to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on ASC 718, Compensation-Stock Compensation The fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. Income Taxes The Company uses an asset and liability approach for accounting and reporting for income taxes that allows recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. Loss per Common Share Basic earnings (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation when their effect is antidilutive. For the years ended December 31, 2020 and 2019, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: Schedule of Potentially Dilutive Securities December 31, 2020 December 31, 2019 Convertible note to a related party - 2,266,667 Warrants 3,362,241 6,413,782 Common stock equivalent of Series A Convertible Preferred Stock 37,644 37,644 Unvested restricted common stock 150,000 - Options 9,417,898 3,265,580 Total 12,967,783 11,983,673 The Series A Convertible Preferred Stock is convertible into Common shares at the rate of 1:4. Fair Value of Financial Instruments The Company uses various inputs in determining the fair value of its financial assets and liabilities and measures these assets on a recurring basis. Financial assets recorded at fair value are categorized by the level of subjectivity associated with the inputs used to measure their fair value. Accounting Standards Codification Section 820 defines the following levels of subjectivity associated with the inputs: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable, short-term bank loans, accounts payable, notes payable and other payables, approximate their fair values because of the short maturity of these instruments. The carrying values of capital lease obligations and long-term financing obligations approximate their fair values because interest rates on these obligations are based on prevailing market interest rates. As of December 31, 2020, and 2019, the Company’s balance sheets included Level 2 liabilities comprised of the fair value of warrant liabilities aggregating $ 0 8 Segments The Company operates in one segment for the manufacture and distribution of our products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements. Concentrations The Company’s cash balances on deposit with banks are guaranteed by the Federal Deposit Insurance Corporation (FDIC) up to $ 250 Gross sales. 25 12 12 11 Accounts receivable. 23 14 During the years ended December 31, 2020 and 2019, respectively, the Company utilized six and four, respectively, separate, co-packers for most its production and bottling of beverage products in the United States. With the December 31, 2018 sale of its manufacturing plant, the Company no longer conducts a manufacturing operation, accordingly it utilizes co-packers to produce 100 100 Purchases from vendors. 12 11 12 11 10 Accounts payable. 12 10 19 15 14 Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “ Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Other recent accounting pronouncements issued by the FASB, its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements. |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory | 3. Inventory Inventory is valued at the lower of cost (first-in, first-out) or net realizable value, and net of reserves is comprised of the following (in thousands): Schedule of Inventory December 31, 2020 December 31, 2019 Raw materials and packaging $ 6,793 $ 4,261 Finished products 4,326 6,247 Total $ 11,119 $ 10,508 The Company has recorded a reserve for slow moving and potentially obsolete inventory. The reserve at December 31, 2020 and 2019 was $ 194 646 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 4. Property and Equipment Property and equipment is comprised of the following (in thousands): Schedule of Property and Equipment December 31, 2020 December 31, 2019 Right-of-use assets under operating leases $ 724 $ 730 Right-of-use assets under finance leases 54 179 Computer hardware and software 400 543 Machinery and equipment 103 83 Total cost 1,281 1,535 Accumulated depreciation and amortization (361 ) (482 ) Net book value $ 920 $ 1,053 Depreciation expense for the years ended December 31, 2020 and 2019 was $ 88 and $ 24 , respectively, and amortization of right-of-use assets for the years ended December 31, 2020 and 2019 was $ 116 and $ 91 , respectively. During the year ended December 31, 2020, the Company disposed of right-of-use assets under finance leases with a net book value of $ 51 and terminated $ 51 of related finance leases (see Note 9). Additionally, during the year ended December 31, 2020, the Company reclassified $ 6 of right-of-use assets under operating leases to right-of-use assets under finance leases and disposed of fully depreciated computer hardware and software of $ 244 with zero net book value. Equipment held for sale consists of the following (in thousands): Schedule of Equipment Held for Sale December 31, 2020 December 31, 2019 Equipment held for sale $ 163 $ 163 Reserve (96 ) (96 ) Net book value $ 67 $ 67 The balance as of December 31, 2020 and 2019 consists of residual manufacturing equipment, at estimated net realizable value, which management anticipates selling during 2021. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 5. Intangible Assets Intangible assets are comprised of brand names acquired, specifically Virgil’s, and costs related to trademarks. They have been assigned an indefinite life, as we currently anticipate that they will contribute cash flows to the Company perpetually. These indefinite-lived intangible assets are not amortized but are assessed for impairment annually and evaluated annually to determine whether the indefinite useful life remains appropriate. We first assess qualitative factors to determine whether it is more likely than not that the asset is impaired. If further testing is necessary, we compare the estimated fair value of our asset with its book value. If the carrying amount of the asset exceeds its fair value, as determined by the discounted cash flows expected to be generated by the asset, an impairment loss is recognized in an amount equal to that excess. Based on management’s assessment, there were no During the year ended December 31, 2020, the Company capitalized costs of $ 39 Intangible assets consist of the following (in thousands): Summary of Intangible Assets December 31, 2020 December 31, 2019 Brand names $ 576 $ 576 Trademarks 39 - Total $ 615 $ 576 |
Line of Credit
Line of Credit | 12 Months Ended |
Dec. 31, 2020 | |
Line Of Credit | |
Line of Credit | 6. Line of Credit Amounts outstanding under the Company’s credit facilities are as follows (in thousands): Schedule of Amount Outstanding Under Credit Facilities December 31, 2020 December 31, 2019 Line of Credit $ $ 3,661 Capitalized finance costs - (484 ) Net balance $ - $ 3,177 On October 4, 2018, the Company entered into a financing agreement with Rosenthal & Rosenthal, Inc. The financing agreement provides a maximum borrowing capacity of $ 13,000 4,000 5,166 March 30, 2021 Borrowings under the Rosenthal financing agreement bear interest at the greater of prime or 4.75 2.0 3.5 4 The line of credit is secured by substantially all of the assets, excluding intellectual property, of the Company. The over-advance is secured by all of Reed’s intellectual property collateral. Additionally, any over-advance is guaranteed by an irrevocable stand-by letter of credit in the amount of $ 1,500 7.4 The financing agreement with Rosenthal includes customary restrictions that limit our ability to engage in certain types of transactions, including our ability to utilize tangible and intangible assets as collateral for other indebtedness. Additionally, the agreement contains a financial covenant that requires us to meet certain minimum working capital and tangible net worth thresholds as of the end of each quarter. We were in compliance with the terms of our agreement with Rosenthal as of December 31, 2020. The Company annually incurs an additional $ 130 1 452 323 162 |
Convertible Note to a Related P
Convertible Note to a Related Party | 12 Months Ended |
Dec. 31, 2020 | |
Convertible Note To Related Party | |
Convertible Note to a Related Party | 7. Convertible Note to a Related Party The Convertible Note to a Related Party consists of the following (in thousands): Schedule of Convertible Notes December 31, 2020 December 31, 2019 12% Convertible Note Payable $ $ 3,400 Accrued Interest - 1,289 Total obligation $ - $ 4,689 On April 21, 2017, pursuant to a Securities Purchase Agreement, the Company issued a secured, convertible, subordinated, non-redeemable note in the principal amount of $ 3,400 1,416,667 The Raptor Note bears interest at a rate of 12 April 21, 2021 1.50 The warrant will expire on April 21, 2022 1.50 two On December 11, 2020, the Company entered into a Satisfaction, Settlement and Release Agreement with Raptor satisfying all of its obligations to Raptor as its junior secured lender. In full satisfaction of the Raptor Note, including release of collateral, and termination of related junior lender documentation, the Company (a) paid Raptor $ 4,250 in cash, (b) issued to Raptor a 5 -year warrant with a fair value of $ 402 to purchase 1,000,000 shares of the Company common stock with an exercise price of $ 0.64 1,339,286 857 750 0.56 5,509 5,247 262 |
Note Payable
Note Payable | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Note Payable | 8. Note Payable On April 20, 2020, the Company was granted a loan (the “PPP loan”) from City National Bank in the aggregate amount of $ 770 At December 31, 2020, the note payable balance was $ 770 599 The PPP loan agreement is dated April 20, 2020, matures on April 20, 2022 1 Debt If the conditions outlined in the PPP loan program are adhered to by the Company, all or part of such loan could be forgiven. The Company believes that all or a substantial portion of the PPP loan is eligible for forgiveness. The Company applied for full forgiveness of the PPP loan on March 17, 2021. As for the potential loan forgiveness, once the PPP loan is, in part or wholly, forgiven and a legal release is received, the liability would be reduced by the amount forgiven and a gain on extinguishment would be recorded. However, the Company cannot provide any assurance whether the PPP loan will ultimately be forgiven by the SBA. |
Leases Liabilities
Leases Liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases Liabilities | 9. Leases Liabilities The Company determines whether a contract is, or contains, a lease at inception. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term. The Company leases its headquarters , and certain office equipment and automobiles. Leases with an initial term of 12 months or less are not included on the balance sheets. During the years ended December 31, 2020 and 2019, lease costs totaled $ 181 181 As of December 31, 2018, lease liabilities totaled $ 852 133 719 44 22 786 89 697 51 22 28 685 16 669 As of December 31, 2020, the weighted average remaining lease terms for operating lease and finance lease are 4.00 0.28 12.60 6.03 Future minimum lease payments under the leases are as follows (in thousands): Schedule of Future Minimum Lease Payments Under Leases Dec 31, 2020 Years Ending December 31, 2021 $ 209 2022 222 2023 226 2024 221 2025 - Total payments 878 Less: Amount representing interest (193 ) Present value of net minimum lease payments 685 Less: Current portion (130 ) Non-current portion $ 555 |
Warrant Liability
Warrant Liability | 12 Months Ended |
Dec. 31, 2020 | |
Warrant Liability | |
Warrant Liability | 10. Warrant Liability Various sales of common stock made by the Company to finance operations have been accompanied by the issuance of warrants. Some of these warrant agreements contain fundamental transaction provisions which may give rise to an obligation of the Company to pay cash to the warrant holders. For accounting purposes, in accordance with ASC 480, Distinguishing Liabilities from Equity The fair value of the warrant liability was determined using the Black-Scholes-Merton option pricing model at December 31, 2020 and December 31, 2019, using the following assumptions: Schedule of Warrant Liability Using Assumptions December 31, 2020 December 31, 2019 Stock Price $ 0.59 $ 0.91 Risk free interest rate 0.48 % 1.95 % Expected volatility 76.35 % 83.36 % Expected life in years 0.42 1.42 Expected dividend yield 0 % 0 % Number of Warrants containing fundamental transaction provisions 138,762 138,762 Fair Value of Warrants $ - $ 8 The risk-free interest rate is based on rates established by the Federal Reserve Bank. The Company uses the historical volatility of its common stock to estimate its future volatility. The expected life of the warrant is based upon its remaining contractual life. The expected dividend yield reflects that the Company has not paid dividends to its common stockholders in the past and does not expect to do so in the foreseeable future. The following table sets forth a summary of the changes in the estimated fair value of the warrant liability during the year ended December 31, 2020 and 2019: Schedule of Warrant Liability December 31, December 31, Beginning Balance $ 8 $ 38 Change in fair value (8 ) (30 ) Ending balance $ - $ 8 |
Stockholders_ Equity
Stockholders’ Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Stockholders’ Equity | 11. Stockholders’ Equity Series A Convertible Preferred Stock Series A Convertible Preferred Stock (the “Preferred Stock”) consists of $ 10 5 10.00 500,000 9,411 Dividends are payable at the rate of 5 In the event of any liquidation, dissolution or winding up of the Company, or if there is a change of control event as defined, the holders of the Preferred Stock are entitled to receive, prior to distributions to the holders of common stock, $10.00 per share plus all accrued and unpaid dividends. Thereafter, all remaining assets are distributed pro rata among all security holders. Since June 30, 2008, the Company has the right, but not the obligation, to redeem all or any portion of the Preferred Stock at $10.00 per share, the original issue price, plus all accrued and unpaid dividends. The Preferred Stock may be converted at any time, at the option of the holder, into four shares of common stock, subject to adjustment in the event of stock splits, reverse stock splits, stock dividends, recapitalization, reclassification, and similar transactions. The Company is obligated to reserve authorized but unissued shares of common stock sufficient to affect the conversion of all outstanding shares of Preferred Stock. Except as provided by law, the holders of the Preferred Stock do not have the right to vote on any matters, including the election of directors. However, so long as any shares of Preferred Stock are outstanding, the Company shall not, without the approval of a majority of the preferred stockholders, authorize or issue any equity security having a preference over the Preferred Stock with respect to dividends, liquidation, redemption or voting, including any other security convertible into or exercisable for any senior preferred stock. During the years ended December 31, 2020 and 2019, the Company paid dividends on the Preferred Stock through the issuance of 4,530 4,254 5 Common Stock The Company’s common stock has a par value of $ .0001 . On December 21, 2020, our shareholders approved an increase in the authorized number of common shares from 100,000,000 to 120,000,000 . As of December 31, 2020, there were 120,000,000 shares authorized with 86,317,096 outstanding. As of December 31, 2019, there were 100,000,000 shares authorized, and 47,595,206 shares of common stock outstanding. Common Stock Issuance In November 2020, the Company conducted a public offering of 21,562,500 0.56 11,254 In April 2020, the Company conducted a public offering of 15,333,334 0.375 5,310 In October 2019, the Company conducted a public offering of 13,416,667 0.60 7,474 In February 2019, the Company conducted a public offering of 7,733,750 2.10 14,867 |
Share-Based Payments
Share-Based Payments | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Payments | 12. Share-Based Payments Management believes that the ability to issue equity compensation, in order to incentivize performance by employees, directors, and consultants, is essential to the Company’s growth strategy. On September 29, 2017, the 2017 Compensation Plan (the “2017 Plan”) was approved by our shareholders. Initially it provided for the issuance of up to 3,000,000 3,500,000 1,168,258 3,436,864 On December 21, 2020, the 2020 Equity Incentive Plan (the “2020 Plan”) was approved by our shareholders. The 2020 Plan provides for the issuance of up to 8,500,000 3,874,048 The 2020 Plan permits the grant of options and stock awards to our employees, directors and consultants. The options may constitute either “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code or “non-qualified stock options”. The Plan is currently administered by the board of directors. The exercise price of an option granted under the plan cannot be less than 100% of the fair market value per share of common stock on the date of the grant of the option. Options may not be granted under the plan on or after the tenth anniversary of the adoption of the plan. Incentive stock options granted to a person owning more than 10% of the combined voting power of the common stock cannot be exercisable for more than five years. Restricted common stock The following table summarizes restricted stock activity during the years ended December 31, 2020 and 2019: Summary of Non-vested Restricted Stock Activity Unvested Issuable Fair Value Weighted Balance, December 31, 2018 598,370 - $ 592 $ 1.63 Granted 46,035 - 132 2.88 Vested (488,037 ) 488,037 - - Forfeited (156,368 ) - (218 ) 1.60 Issued - (488,037 ) (506 ) - Balance, December 31, 2019 - - - - Balance, December 31, 2019 - - - - Granted 594,740 - 508 0.85 Vested (444,740 ) 444,740 - - Issued - (444,740 ) (416 ) - Balance, December 31, 2020 150,000 - $ 92 $ 0.89 During the year ended December 31, 2020, the Company issued 594,740 350,000 94,740 47,370 75,000 four 75,000 four 508 0.81 0.95 416 506 92 In 2018, the Company awarded an aggregate of 784,004 1,291 185,634 442,002 156,368 374 During the year ended December 31, 2019, the Company issued 46,035 17,652 28,383 132 46,035 132 During the year ended December 31, 2019, the Company recognized a total $ 506 Stock Options As of December 31, 2020, the Company has issued stock options to purchase an aggregate of 9,417,898 Schedule of Stock Option Activity Shares Weighted- Weighted- Aggregate Outstanding at December 31, 2018 3,674,286 $ 2.16 8.53 $ 1,026 Granted 1,431,840 2.48 Exercised - - Unvested forfeited or expired (1,571,794 ) 2.25 Vested forfeited or expired (268,702 ) 3.07 Outstanding at December 31, 2019 3,265,630 $ 2.19 7.09 $ 6 Outstanding at December 31, 2019 3,265,630 $ 2.19 7.09 6 Granted 6,893,752 0.87 Exercised (37,500 ) 0.50 Unvested forfeited or expired (515,941 ) 2.10 Vested forfeited or expired (188,043 ) 4.20 Outstanding at December 31, 2020 9,417,898 $ 1.19 8.55 $ 78 Exercisable at December 31, 2020 2,266,440 $ 1.45 6.09 $ 78 During the year ended December 31, 2020, the Company approved options exercisable into 4,625,952 2,267,800 6,558,752 3,279,376 four 3,279,376 335,000 The stock options are exercisable at a weighted average price $ 0.87 ten 3,561 5.91 76 0 0.48 2.67 During the year ended December 31, 2019, the Company approved options to be issued pursuant to Reed’s 2017 Incentive Compensation Plan to certain current employees totaling 1,258,000 four 113,330 60,510 no The stock options are exercisable at a price ranging from $ 2.33 3.37 ten 911 seven 61 0 1.39 2.60 In the measurement of stock options granted in 2020 and 2019, the expected term represents the weighted-average period of time that share option awards granted are expected to be outstanding giving consideration to vesting schedules and historical participant exercise behavior; the expected volatility is based upon historical volatility of the Company’s common stock; the expected dividend yield is based on the fact that the Company has not paid dividends in the past and does not expect to pay dividends in the future; and the risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of measurement corresponding with the expected term of the share option award. During the year ended December 31, 2020 and 2019, the Company recognized $ 1,176 790 3,561 As of December 31, 2020, the outstanding options have an intrinsic value of $ 78 0.59 Additional information regarding options outstanding and exercisable as of December 31, 2020, is as follows: Schedule of Information Regarding Stock Options Options Outstanding Options Exercisable Range of Exercise Price Number of Weighted Weighted Number of Weighted $ 0.50 0.88 1,860,300 $ 0.66 9.05 860,300 $ 0.50 $ 0.89 1.34 4,975,952 0.95 9.70 - - $ 2.49 3.74 1,899,605 1.74 5.96 1,060,240 1.72 $ 2.49 3.74 582,091 2.78 6.92 245,950 2.69 $ 5.01 5.01 99,950 3.74 1.05 99,950 3.74 9,417,898 $ 1.19 8.55 2,266,440 $ 1.45 |
Stock Warrants
Stock Warrants | 12 Months Ended |
Dec. 31, 2020 | |
Stock Warrants | |
Stock Warrants | 13. Stock Warrants As of December 31, 2020, the Company has issued warrants to purchase an aggregate of 3,362,241 Schedule of Warrant Activity Shares Weighted -Average Exercise Price Weighted-Average Remaining Contractual Terms (Years) Aggregate Intrinsic Value Outstanding at December 31, 2018 6,897,277 $ 2.06 2.42 $ 1,447 Granted - - Exercised (283,495 ) 2.09 Forfeited or expired (200,000 ) 5.60 Outstanding at December 31, 2019 6,413,782 2.06 1.52 $ - Outstanding at December 31, 2019 6,413,782 2.06 1.52 $ - Granted 1,000,000 0.64 Exercised - - Forfeited or expired (4,051,541 ) 2.03 Outstanding at December 31, 2020 3,362,241 $ 1.56 2.49 $ - Exercisable at December 31, 2020 3,362,241 $ 1.56 2.49 $ - On December 11, 2020, the Company issued to Raptor a 5 1,000,000 0.64 402 0.64 0.64 5 79 0 0.51 4,051,541 During the year ended December 31, 2019, a total of 283,495 87,485 223,037 365 200,000 Additional information regarding warrants outstanding and exercisable as of December 31, 2020, is as follows: Schedule of Warrants Outstanding and Exercisable Warrants Outstanding Warrants Exercisable Range of Exercise Price Number of Weighted Weighted Number of Weighted $ 0.64 1.55 2,560,194 $ 1.17 2.92 2,560,194 $ 1.17 $ 2.00 4.25 802,047 2.82 1.11 802,047 2.82 3,362,241 $ 1.56 2.49 3,362,241 $ 1.56 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 14. Income Taxes At December 31, 2020 and 2019, the Company had available Federal and state net operating loss carryforwards (“NOL”s) to reduce future taxable income. For Federal purposes the amounts available were approximately $ 66,000 58,000 42,000 34,000 33,000 2037 33,000 offset 80% of taxable income in future years. 2040 Due to restrictions imposed by Internal Revenue Code Section 382 regarding substantial changes in ownership of companies with loss carryforwards, the utilization of the Company’s NOL may be limited as a result of changes in stock ownership. NOLs incurred subsequent to the latest change in control are not subject to the limitation. The Company recognizes tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position is measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. As of December 31, 2020 and 2019, the Company did not have a liability for unrecognized tax benefits. The Company recognizes as income tax expense, interest and penalties on uncertain tax provisions. As of December 31, 2020 and 2019, the Company has not accrued interest or penalties related to uncertain tax positions. Tax years 2016 through 2020 remain open to examination by the major taxing jurisdictions to which the Company is subject. Upon the attainment of taxable income by the Company, management will assess the likelihood of realizing the tax benefit associated with the use of the NOLs and will recognize the appropriate deferred tax asset at that time. Significant components of the Company’s deferred tax assets and liabilities are as follows: Schedule of Deferred Income Tax Assets December 31, 2020 December 31, 2019 Deferred income tax asset: Net operating loss carryforwards $ 15,641 $ 12,776 Disqualified corporate interest expense 857 581 Stock-based compensation 1,260 942 Accounts receivable allowances 61 98 Inventory reserves 51 168 Operating lease liability 179 181 Reserve for asset impairment 58 58 Gross deferred tax assets 18,107 14,804 Valuation allowance (17,903 ) (14,488 ) Total deferred tax assets 203 316 Deferred tax liabilities: Operating lease right-of-use asset (203 ) (190 ) Deferred finance costs - (126 ) Total deferred tax liabilities (203 ) (316 ) Net deferred tax asset (liability) $ - $ - Reconciliation of the effective income tax rate to the U.S. statutory rate is as follows: Schedule of Reconciliation of Effective Income Tax Rate to U.S. Statutory Rate December 31, 2020 December 31, 2019 Federal statutory tax rate (21 )% (21 )% State rate, net of federal benefit (5 )% (5 )% (26 )% (26 )% Effect of change in tax rate - % - % Valuation allowance 26 % 26 % Effective tax rate $ - $ - |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 15. Related Party Transactions On December 31, 2018, the Company completed the sale of its Los Angeles manufacturing plant to California Custom Beverage, LLC (“CCB”), an entity owned by Christopher J. Reed, a related party, and CCB assumed the monthly payments on our lease obligation for the Los Angeles manufacturing plant. Our release from the obligation by the lessor, however, is dependent upon CCB’s deposit of $ 1,200 800 363,000 338 Beginning in 2019, we are to receive a 5 5 98 128 At December 31, 2019, the Company had royalty revenue receivable from CCB of $ 128 228 356 381 153 153 682 At December 31, 2020 and December 31, 2019, the Company had accounts payable due to CCB of $ 557 182 Lindsay Martin, daughter of a director of the Company, was employed as Vice President of Marketing during the years ended December 31, 2020 and 2019. Ms. Martin was paid approximately $ 215 161 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 16. Commitments and Contingencies From time to time, we are a party to claims and legal proceedings arising in the ordinary course of business. Our management evaluates our exposure to these claims and proceedings individually and in the aggregate and provides for potential losses on such litigation if the amount of the loss is estimable and the loss is probable. We believe that there are no material litigation matters at the current time. Although the results of such litigation matters and claims cannot be predicted with certainty, we believe that the final outcome of such claims and proceedings will not have a material adverse impact on our financial position, liquidity, or results of operations. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events On March 11, 2021, the Company entered into an amendment to that certain Financing Agreement (see Note 6) dated October 4, 2018, as amended or supplemented with its senior secured lender, Rosenthal & Rosenthal, Inc. (“Rosenthal”) releasing that irrevocable standby letter of credit by Daniel J. Doherty, III and Daniel J. Doherty, III 2002 Family Trust in the amount of $ 1.5 2 John Bello, current Chairman and former Interim Chief Executive Officer of Reed’s, is a related party. He is also a greater than 5% beneficial owner of Reed’s common stock. 400,000 The Nasdaq Listing Qualifications Department notified the Company on December 2, 2020 that the bid price of our common stock has closed at less than $ 1 1.00 On January 26, 2021, the board of directors of Reed’s, pursuant to a joint recommendation from its governance and compensation committees, set the cash compensation of its non-employee directors at $ 50,000 49,180 Subsequent to December 31, 2020, the Company issued 86,225 6,000 61,475 18,750 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Those estimates and assumptions include estimates for reserves of uncollectible accounts receivables, assumptions used in valuing inventories at net realizable value, impairment testing of recorded long-term tangible and intangible assets, the valuation allowance for deferred tax assets, accruals for potential liabilities, assumptions made in valuing stock instruments issued for services, and assumptions used in valuing warrant liabilities, and assumptions used in the determination of the Company’s liquidity. |
Accounts Receivable | Accounts Receivable Accounts receivable are generally recorded at the invoiced amounts net of an allowance for expected losses. The Company evaluates the collectability of its trade accounts receivable based on a number of factors. In circumstances where the Company becomes aware of a specific customer’s inability to meet its financial obligations to the Company, a specific reserve for bad debts is estimated and recorded, which reduces the recognized receivable to the estimated amount the Company believes will ultimately be collected. In addition to specific customer identification of potential bad debts, bad debt charges are recorded based on the Company’s historical losses and an overall assessment of past due trade accounts receivable outstanding. The allowance for accounts receivable is established through a provision reducing the carrying value of receivables. At December 31, 2020 and 2019, the allowance was $ 234 and $ 375 , respectively. |
Inventory | Inventory Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out (“FIFO”) basis. We regularly review our inventory quantities on hand and record a provision for excess and obsolete inventory based primarily on our estimated forecast of product demand and our ability to sell the product(s) concerned. Demand for our products can fluctuate significantly. Factors that could affect demand for our products include unanticipated changes in consumer preferences, general market conditions or other factors, which may result in cancellations of advance orders or a reduction in the rate of reorders placed by customers. Additionally, our management’s estimates of future product demand may be inaccurate, which could result in an understated or overstated provision required for excess and obsolete inventory. At December 31, 2020 and 2019, the reserve for inventory obsolescence aggregated $ 194 646 |
Property and Equipment | Property and Equipment Property and equipment is stated at cost. Expenditures for major renewals and improvements that extend the useful lives of property and equipment or increase production capacity are capitalized, and expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is calculated using accelerated and straight-line methods over the estimated useful lives of the assets as follows: Schedule of Estimated Useful Lives of Property and Equipment and Related Depreciation Property and Equipment Type Years of Depreciation Computer hardware and software 3 7 Machinery and equipment 5 Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. For the years ended December 31, 2020 and 2019, the Company determined there were no indicators of impairment of its property and equipment. |
Intangible Assets | Intangible Assets Intangible assets are comprised of indefinite-lived brand names acquired, so classified because we anticipate that these brand names will contribute cash flows to the Company perpetually. Indefinite-lived intangible assets are not amortized but are assessed for impairment annually, or more frequently if events or circumstances indicate that assets might be impaired, and evaluated annually to determine whether the indefinite useful life is appropriate. As part of our impairment test, we first assess qualitative factors to determine whether it is more likely than not the asset is impaired. If further testing is necessary, we compare the estimated fair value of our asset with its book value. If the carrying amount of the asset exceeds its fair value, as determined by its discounted cash flows, an impairment loss is recognized in an amount equal to that excess. For the years ended December 31, 2020 and 2019, the Company determined there was no impairment of its indefinite-lived brand names. |
Warrant Liabilities | Warrant Liabilities Various stock sales made by the Company to finance operations have been accompanied by the issuance of warrants. Some of these warrant agreements contain fundamental transaction provisions which may give rise to an obligation of the Company to pay cash to the warrant holders in the event that a fundamental transaction occurs (such as a merger or change in control of the Company) and such cash payment is elected by the holder. For accounting purposes, in accordance with ASC 480, Distinguishing Liabilities from Equity Fair value is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect the amount of expense recorded in future periods. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs upon shipment from our facilities. The Company’s performance obligations are satisfied at that time. The Company does not have any significant contracts with customers requiring performance beyond delivery, and contracts with customers contain no incentives or discounts that could cause revenue to be allocated or adjusted over time. Shipping and handling activities are performed before the customer obtains control of the goods and therefore represent a fulfillment activity rather than a promised service to the customer. All of the Company’s products are offered for sale as finished goods only, and there are no performance obligations required post-shipment for customers to derive the expected value from them. The Company does not allow for returns, except for damaged products when the damage occurred pre-fulfillment. Damaged product returns have historically been insignificant. Because of this, the stand-alone nature of our products, and our assessment of performance obligations and transaction pricing for our sales contracts, we do not currently maintain a contract asset or liability balance for obligations. We assess our contracts and the reasonableness of our conclusions on a quarterly basis. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold is comprised of the costs of raw materials and packaging utilized in the manufacture of products, co-packing fees, repacking fees, in-bound freight charges, as well as certain internal transfer costs. Additionally, cost of goods sold includes direct production costs in excess of charges allocated to finished goods in production. Plant costs include labor costs, production supplies, repairs and maintenance, depreciation, direct inventory write-off charges and adjustments to the inventory reserve. Charges for labor and overhead allocated to finished goods are determined on a market cost basis, which may be lower than the actual costs incurred. Plant costs in excess of production allocations are expensed in the period incurred rather than added to the cost of finished goods produced. Expenses not related to the production of our products are classified as operating expenses. |
Delivery and Handling Expense | Delivery and Handling Expense Shipping and handling costs are comprised of purchasing and receiving, inspection, warehousing, transfer freight, and other costs associated with product distribution after manufacture and are included as part of operating expenses. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and are included in selling and marketing expense. Advertising costs aggregated $ 1,518 2,570 |
Stock Compensation Expense | Stock Compensation Expense The Company periodically issues stock options and restricted stock awards to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on ASC 718, Compensation-Stock Compensation The fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. |
Income Taxes | Income Taxes The Company uses an asset and liability approach for accounting and reporting for income taxes that allows recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. |
Loss per Common Share | Loss per Common Share Basic earnings (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation when their effect is antidilutive. For the years ended December 31, 2020 and 2019, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: Schedule of Potentially Dilutive Securities December 31, 2020 December 31, 2019 Convertible note to a related party - 2,266,667 Warrants 3,362,241 6,413,782 Common stock equivalent of Series A Convertible Preferred Stock 37,644 37,644 Unvested restricted common stock 150,000 - Options 9,417,898 3,265,580 Total 12,967,783 11,983,673 The Series A Convertible Preferred Stock is convertible into Common shares at the rate of 1:4. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company uses various inputs in determining the fair value of its financial assets and liabilities and measures these assets on a recurring basis. Financial assets recorded at fair value are categorized by the level of subjectivity associated with the inputs used to measure their fair value. Accounting Standards Codification Section 820 defines the following levels of subjectivity associated with the inputs: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable, short-term bank loans, accounts payable, notes payable and other payables, approximate their fair values because of the short maturity of these instruments. The carrying values of capital lease obligations and long-term financing obligations approximate their fair values because interest rates on these obligations are based on prevailing market interest rates. As of December 31, 2020, and 2019, the Company’s balance sheets included Level 2 liabilities comprised of the fair value of warrant liabilities aggregating $ 0 8 |
Segments | Segments The Company operates in one segment for the manufacture and distribution of our products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements. |
Concentrations | Concentrations The Company’s cash balances on deposit with banks are guaranteed by the Federal Deposit Insurance Corporation (FDIC) up to $ 250 Gross sales. 25 12 12 11 Accounts receivable. 23 14 During the years ended December 31, 2020 and 2019, respectively, the Company utilized six and four, respectively, separate, co-packers for most its production and bottling of beverage products in the United States. With the December 31, 2018 sale of its manufacturing plant, the Company no longer conducts a manufacturing operation, accordingly it utilizes co-packers to produce 100 100 Purchases from vendors. 12 11 12 11 10 Accounts payable. 12 10 19 15 14 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “ Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Other recent accounting pronouncements issued by the FASB, its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Property and Equipment and Related Depreciation | Schedule of Estimated Useful Lives of Property and Equipment and Related Depreciation Property and Equipment Type Years of Depreciation Computer hardware and software 3 7 Machinery and equipment 5 |
Schedule of Potentially Dilutive Securities | Schedule of Potentially Dilutive Securities December 31, 2020 December 31, 2019 Convertible note to a related party - 2,266,667 Warrants 3,362,241 6,413,782 Common stock equivalent of Series A Convertible Preferred Stock 37,644 37,644 Unvested restricted common stock 150,000 - Options 9,417,898 3,265,580 Total 12,967,783 11,983,673 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory is valued at the lower of cost (first-in, first-out) or net realizable value, and net of reserves is comprised of the following (in thousands): Schedule of Inventory December 31, 2020 December 31, 2019 Raw materials and packaging $ 6,793 $ 4,261 Finished products 4,326 6,247 Total $ 11,119 $ 10,508 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment is comprised of the following (in thousands): Schedule of Property and Equipment December 31, 2020 December 31, 2019 Right-of-use assets under operating leases $ 724 $ 730 Right-of-use assets under finance leases 54 179 Computer hardware and software 400 543 Machinery and equipment 103 83 Total cost 1,281 1,535 Accumulated depreciation and amortization (361 ) (482 ) Net book value $ 920 $ 1,053 |
Schedule of Equipment Held for Sale | Equipment held for sale consists of the following (in thousands): Schedule of Equipment Held for Sale December 31, 2020 December 31, 2019 Equipment held for sale $ 163 $ 163 Reserve (96 ) (96 ) Net book value $ 67 $ 67 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | Intangible assets consist of the following (in thousands): Summary of Intangible Assets December 31, 2020 December 31, 2019 Brand names $ 576 $ 576 Trademarks 39 - Total $ 615 $ 576 |
Line of Credit (Tables)
Line of Credit (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Line Of Credit | |
Schedule of Amount Outstanding Under Credit Facilities | Amounts outstanding under the Company’s credit facilities are as follows (in thousands): Schedule of Amount Outstanding Under Credit Facilities December 31, 2020 December 31, 2019 Line of Credit $ $ 3,661 Capitalized finance costs - (484 ) Net balance $ - $ 3,177 |
Convertible Note to a Related_2
Convertible Note to a Related Party (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Convertible Note To Related Party | |
Schedule of Convertible Notes | The Convertible Note to a Related Party consists of the following (in thousands): Schedule of Convertible Notes December 31, 2020 December 31, 2019 12% Convertible Note Payable $ $ 3,400 Accrued Interest - 1,289 Total obligation $ - $ 4,689 |
Leases Liabilities (Tables)
Leases Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of Future Minimum Lease Payments Under Leases | Future minimum lease payments under the leases are as follows (in thousands): Schedule of Future Minimum Lease Payments Under Leases Dec 31, 2020 Years Ending December 31, 2021 $ 209 2022 222 2023 226 2024 221 2025 - Total payments 878 Less: Amount representing interest (193 ) Present value of net minimum lease payments 685 Less: Current portion (130 ) Non-current portion $ 555 |
Warrant Liability (Tables)
Warrant Liability (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Warrant Liability | |
Schedule of Warrant Liability Using Assumptions | The fair value of the warrant liability was determined using the Black-Scholes-Merton option pricing model at December 31, 2020 and December 31, 2019, using the following assumptions: Schedule of Warrant Liability Using Assumptions December 31, 2020 December 31, 2019 Stock Price $ 0.59 $ 0.91 Risk free interest rate 0.48 % 1.95 % Expected volatility 76.35 % 83.36 % Expected life in years 0.42 1.42 Expected dividend yield 0 % 0 % Number of Warrants containing fundamental transaction provisions 138,762 138,762 Fair Value of Warrants $ - $ 8 |
Schedule of Warrant Liability | The following table sets forth a summary of the changes in the estimated fair value of the warrant liability during the year ended December 31, 2020 and 2019: Schedule of Warrant Liability December 31, December 31, Beginning Balance $ 8 $ 38 Change in fair value (8 ) (30 ) Ending balance $ - $ 8 |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Non-vested Restricted Stock Activity | The following table summarizes restricted stock activity during the years ended December 31, 2020 and 2019: Summary of Non-vested Restricted Stock Activity Unvested Issuable Fair Value Weighted Balance, December 31, 2018 598,370 - $ 592 $ 1.63 Granted 46,035 - 132 2.88 Vested (488,037 ) 488,037 - - Forfeited (156,368 ) - (218 ) 1.60 Issued - (488,037 ) (506 ) - Balance, December 31, 2019 - - - - Balance, December 31, 2019 - - - - Granted 594,740 - 508 0.85 Vested (444,740 ) 444,740 - - Issued - (444,740 ) (416 ) - Balance, December 31, 2020 150,000 - $ 92 $ 0.89 |
Schedule of Stock Option Activity | Schedule of Stock Option Activity Shares Weighted- Weighted- Aggregate Outstanding at December 31, 2018 3,674,286 $ 2.16 8.53 $ 1,026 Granted 1,431,840 2.48 Exercised - - Unvested forfeited or expired (1,571,794 ) 2.25 Vested forfeited or expired (268,702 ) 3.07 Outstanding at December 31, 2019 3,265,630 $ 2.19 7.09 $ 6 Outstanding at December 31, 2019 3,265,630 $ 2.19 7.09 6 Granted 6,893,752 0.87 Exercised (37,500 ) 0.50 Unvested forfeited or expired (515,941 ) 2.10 Vested forfeited or expired (188,043 ) 4.20 Outstanding at December 31, 2020 9,417,898 $ 1.19 8.55 $ 78 Exercisable at December 31, 2020 2,266,440 $ 1.45 6.09 $ 78 |
Schedule of Information Regarding Stock Options | Additional information regarding options outstanding and exercisable as of December 31, 2020, is as follows: Schedule of Information Regarding Stock Options Options Outstanding Options Exercisable Range of Exercise Price Number of Weighted Weighted Number of Weighted $ 0.50 0.88 1,860,300 $ 0.66 9.05 860,300 $ 0.50 $ 0.89 1.34 4,975,952 0.95 9.70 - - $ 2.49 3.74 1,899,605 1.74 5.96 1,060,240 1.72 $ 2.49 3.74 582,091 2.78 6.92 245,950 2.69 $ 5.01 5.01 99,950 3.74 1.05 99,950 3.74 9,417,898 $ 1.19 8.55 2,266,440 $ 1.45 |
Stock Warrants (Tables)
Stock Warrants (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Stock Warrants | |
Schedule of Warrant Activity | Schedule of Warrant Activity Shares Weighted -Average Exercise Price Weighted-Average Remaining Contractual Terms (Years) Aggregate Intrinsic Value Outstanding at December 31, 2018 6,897,277 $ 2.06 2.42 $ 1,447 Granted - - Exercised (283,495 ) 2.09 Forfeited or expired (200,000 ) 5.60 Outstanding at December 31, 2019 6,413,782 2.06 1.52 $ - Outstanding at December 31, 2019 6,413,782 2.06 1.52 $ - Granted 1,000,000 0.64 Exercised - - Forfeited or expired (4,051,541 ) 2.03 Outstanding at December 31, 2020 3,362,241 $ 1.56 2.49 $ - Exercisable at December 31, 2020 3,362,241 $ 1.56 2.49 $ - |
Schedule of Warrants Outstanding and Exercisable | Additional information regarding warrants outstanding and exercisable as of December 31, 2020, is as follows: Schedule of Warrants Outstanding and Exercisable Warrants Outstanding Warrants Exercisable Range of Exercise Price Number of Weighted Weighted Number of Weighted $ 0.64 1.55 2,560,194 $ 1.17 2.92 2,560,194 $ 1.17 $ 2.00 4.25 802,047 2.82 1.11 802,047 2.82 3,362,241 $ 1.56 2.49 3,362,241 $ 1.56 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Income Tax Assets | Significant components of the Company’s deferred tax assets and liabilities are as follows: Schedule of Deferred Income Tax Assets December 31, 2020 December 31, 2019 Deferred income tax asset: Net operating loss carryforwards $ 15,641 $ 12,776 Disqualified corporate interest expense 857 581 Stock-based compensation 1,260 942 Accounts receivable allowances 61 98 Inventory reserves 51 168 Operating lease liability 179 181 Reserve for asset impairment 58 58 Gross deferred tax assets 18,107 14,804 Valuation allowance (17,903 ) (14,488 ) Total deferred tax assets 203 316 Deferred tax liabilities: Operating lease right-of-use asset (203 ) (190 ) Deferred finance costs - (126 ) Total deferred tax liabilities (203 ) (316 ) Net deferred tax asset (liability) $ - $ - |
Schedule of Reconciliation of Effective Income Tax Rate to U.S. Statutory Rate | Reconciliation of the effective income tax rate to the U.S. statutory rate is as follows: Schedule of Reconciliation of Effective Income Tax Rate to U.S. Statutory Rate December 31, 2020 December 31, 2019 Federal statutory tax rate (21 )% (21 )% State rate, net of federal benefit (5 )% (5 )% (26 )% (26 )% Effect of change in tax rate - % - % Valuation allowance 26 % 26 % Effective tax rate $ - $ - |
Operations and Liquidity (Detai
Operations and Liquidity (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Nov. 30, 2020 | Apr. 30, 2020 | Oct. 31, 2019 | Feb. 28, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Subsidiary, Sale of Stock [Line Items] | |||||||
Net Income (Loss) Attributable to Parent | $ 10,177 | $ 16,112 | |||||
Net Cash Provided by (Used in) Operating Activities | 9,496 | 18,161 | |||||
Cash | (595) | (913) | |||||
Line of Credit Facility, Current Borrowing Capacity | (5,166) | ||||||
Stockholders' Equity Attributable to Parent | 10,404 | $ 1,147 | $ (6,743) | ||||
Working capital | $ 9,528 | ||||||
Public Offering [Member] | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Shares sold during the period | 36,900,000 | ||||||
Proceeds from offering | $ 11,254 | $ 5,310 | $ 7,474 | $ 14,867 | $ 16,564 |
Schedule of Estimated Useful Li
Schedule of Estimated Useful Lives of Property and Equipment and Related Depreciation (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Computer Hardware And Software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Expected useful life of assets | 3 |
Computer Hardware And Software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Expected useful life of assets | 7 |
Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Expected useful life of assets | 5 |
Schedule of Potentially Dilutiv
Schedule of Potentially Dilutive Securities (Details) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 12,967,783 | 11,983,673 |
Convertible Note to a Related Party [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,266,667 | |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 3,362,241 | 6,413,782 |
Common Stock Equivalent of Series A Convertible Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 37,644 | 37,644 |
Unvested Restricted Common Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 150,000 | |
Equity Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 9,417,898 | 3,265,580 |
Significant Accounting Polici_4
Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Product Information [Line Items] | ||
Accounts Receivable, net of allowance | $ 234 | $ 375 |
Reserve for inventory obsolescence | 194 | 646 |
Impairment of Intangible Assets, Finite-lived | 0 | 0 |
Advertising costs | $ 1,518 | 2,570 |
Convertible ratio, description | The Series A Convertible Preferred Stock is convertible into Common shares at the rate of 1:4. | |
Warrant liabilities | $ 0 | $ 8 |
Maximum cash deposit guaranteed by FDIC | $ 250 | |
Percentage of co-packers products | 100.00% | |
California Custom Beverage, LLC [Member] | Christopher J. Reed [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 100.00% | |
Customer One [Member] | Revenue Benchmark [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 25.00% | 12.00% |
Customer One [Member] | Accounts Receivable [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 23.00% | 14.00% |
Customer Two [Member] | Revenue Benchmark [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 12.00% | 11.00% |
Vendor One [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 12.00% | 12.00% |
Vendor One [Member] | Accounts Payable [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 12.00% | 19.00% |
Vendor Two [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 11.00% | 11.00% |
Vendor Two [Member] | Accounts Payable [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 10.00% | 15.00% |
Vendor Three [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 10.00% | |
Vendor Three [Member] | Accounts Payable [Member] | ||
Product Information [Line Items] | ||
Percentage of sale accounted to customer | 14.00% |
Schedule of Inventory (Details)
Schedule of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials and packaging | $ 6,793 | $ 4,261 |
Finished products | 4,326 | 6,247 |
Total | $ 11,119 | $ 10,508 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Inventory Valuation Reserves | $ 194 | $ 646 |
Schedule of Property and Equipm
Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 1,281 | $ 1,535 |
Accumulated depreciation and amortization | (361) | (482) |
Net book value | 920 | 1,053 |
Right-of-use Assets Under Operating Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 724 | 730 |
Right-of-use Assets Under Finance Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 54 | 179 |
Computer Hardware And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 400 | 543 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 103 | $ 83 |
Schedule of Equipment Held for
Schedule of Equipment Held for Sale (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Abstract] | ||
Equipment held for sale | $ 163 | $ 163 |
Reserve | (96) | (96) |
Net book value | $ 67 | $ 67 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 88 | $ 24 |
Operating Lease, Right-of-Use Asset, Amortization Expense | 116 | $ 91 |
Right-of-use Assets Under Finance Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Disposals | 51 | |
Property, Plant and Equipment, Transfers and Changes | 51 | |
Gain (Loss) on Disposition of Assets for Financial Service Operations | 6 | |
Computer Hardware And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Disposals | 244 | |
Property, Plant and Equipment, Transfers and Changes | $ 0 |
Summary of Intangible Assets (D
Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Brand names | $ 576 | $ 576 |
Trademarks | 39 | |
Total | $ 615 | $ 576 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Impairment of intangible assets | $ 0 | $ 0 |
intangible asset capitalized cost | $ 39 |
Schedule of Amount Outstanding
Schedule of Amount Outstanding Under Credit Facilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Line Of Credit | ||
Line of Credit | $ 3,661 | |
Capitalized finance costs | (484) | |
Net balance | $ 3,177 |
Line of Credit (Details Narrati
Line of Credit (Details Narrative) - USD ($) $ in Thousands | Oct. 04, 2018 | Dec. 31, 2020 | Dec. 31, 2019 |
Entity Listings [Line Items] | |||
Annual fees | $ 130 | ||
Percentage of fees on borrowing capacity | 1.00% | ||
Amortization of debt discount | $ 452 | $ 323 | |
Prepaid Expenses and Other Current Assets [Member] | |||
Entity Listings [Line Items] | |||
Unamortized debt discount | $ 162 | ||
Daniel J. Doherty [Member] | |||
Entity Listings [Line Items] | |||
Letter of credit | $ 1,500 | ||
Daniel J. Doherty [Member] | Reeds Inc. [Member] | |||
Entity Listings [Line Items] | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 7.40% | ||
Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | |||
Entity Listings [Line Items] | |||
Line of Credit Facility, Maximum Borrowing Capacity | 13,000 | ||
Excess of permitted borrowing amount | $ 4,000 | ||
Line of Credit Facility, Remaining Borrowing Capacity | $ 5,166 | ||
Line of Credit Facility, Expiration Date | Mar. 30, 2021 | ||
Line of credit, interest rate | 4.75% | ||
Minimum monthly fees | $ 4 | ||
Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | Minimum [Member] | |||
Entity Listings [Line Items] | |||
Line of credit, interest rate | 2.00% | ||
Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | Maximum [Member] | |||
Entity Listings [Line Items] | |||
Line of credit, interest rate | 3.50% |
Schedule of Convertible Notes (
Schedule of Convertible Notes (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Convertible Note To Related Party | ||
12% Convertible Note Payable | $ 3,400 | |
Accrued Interest | 1,289 | |
Total obligation | $ 4,689 |
Convertible Note to a Related_3
Convertible Note to a Related Party (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Dec. 11, 2020 | Apr. 21, 2017 | Dec. 31, 2020 | Dec. 31, 2019 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Convertible debt | $ 4,689 | |||
Number of warrants to purchase of common stock | 138,762 | 138,762 | ||
Repayments of Convertible Debt | $ 4,250 | |||
Fair Value Adjustment of Warrants | (8) | (30) | ||
Gain (Loss) on Extinguishment of Debt | (262) | |||
Securities Purchase Agreement [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Number of warrants to purchase of common stock | 1,416,667 | |||
Warrant expiration date | Apr. 21, 2022 | |||
Warrant exercise price | $ 1.50 | |||
Securities Purchase Agreement [Member] | Raptor Note [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Convertible debt | $ 3,400 | |||
Convertible note interest rate percentage | 12.00% | |||
Debt maturity date | Apr. 21, 2021 | |||
Note conversion price per share | $ 1.50 | |||
Note term | 2 years | |||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Convertible debt | $ 5,509 | |||
Number of warrants to purchase of common stock | 1,000,000 | |||
Note conversion price per share | $ 0.56 | |||
Warrant exercise price | $ 0.64 | |||
Repayments of Convertible Debt | $ 4,250 | |||
Warrants and Rights Outstanding, Term | 5 years | |||
Fair Value Adjustment of Warrants | $ 402 | |||
Stock Issued During Period, Shares, New Issues | 1,339,286 | |||
Stock Issued During Period, Value, New Issues | $ 857 | |||
Conversion of Stock, Amount Converted | 750 | |||
Long-term Debt, Gross | $ 5,247 | |||
Gain (Loss) on Extinguishment of Debt | $ 262 |
Note Payable (Details Narrative
Note Payable (Details Narrative) - USD ($) $ in Thousands | Apr. 20, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Note payable | $ 770 | ||
Note payable, current | $ 599 | ||
PPP Loan Agreement [Member] | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Debt Instrument, Maturity Date | Apr. 20, 2022 | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | ||
Paycheck Protection Program [Member] | City National Bank [Member] | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Aggregate amount | $ 770 |
Schedule of Future Minimum Leas
Schedule of Future Minimum Lease Payments Under Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2021 | $ 209 | |
2022 | 222 | |
2023 | 226 | |
2024 | 221 | |
2025 | ||
Total payments | 878 | |
Less: Amount representing interest | 193 | |
Present value of net minimum lease payments | 685 | |
Less: Current portion | 130 | |
Non-current portion | $ 555 | $ 737 |
Leases Liabilities (Details Nar
Leases Liabilities (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Customer Securities for which Entity has Right to Sell or Repledge (Including Securities Sold or Repledged) [Line Items] | |||
Lease costs | $ 181 | $ 181 | |
Lease liabilities | 685 | 786 | $ 852 |
Finance leases liability | 16 | 89 | 133 |
Payments of finance lease liability | 22 | 44 | |
Payments of operating lease | 22 | ||
Finance lease terminated | 51 | ||
Payments of operating lease liability | $ 28 | ||
Weighted average remaining lease term for operating lease | 4 years | ||
Weighted average remaining lease term for finance lease | 3 months 10 days | ||
Weighted average discount rate for operating lease | 12.60% | ||
Weighted average discount rate for finance lease | 6.03% | ||
Operating Lease Liability [Member] | |||
Customer Securities for which Entity has Right to Sell or Repledge (Including Securities Sold or Repledged) [Line Items] | |||
Operating leases liability | $ 669 | $ 697 | $ 719 |
Schedule of Warrant Liability U
Schedule of Warrant Liability Using Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Warrant Liability | ||
Stock Price | $ 0.59 | $ 0.91 |
Risk free interest rate | 0.48% | 1.95% |
Expected volatility | 76.35% | 83.36% |
Expected life in years | 5 months 1 day | 1 year 5 months 1 day |
Expected dividend yield | 0.00% | 0.00% |
Number of Warrants containing fundamental transaction provisions | 138,762 | 138,762 |
Fair Value of Warrants | $ 8 |
Schedule of Warrant Liability (
Schedule of Warrant Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Warrant Liability | ||
Beginning Balance | $ 8 | $ 38 |
Change in fair value | (8) | (30) |
Ending balance | $ 8 |
Stockholders_ Equity (Details N
Stockholders’ Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Nov. 30, 2020 | Apr. 30, 2020 | Oct. 31, 2019 | Feb. 28, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 21, 2020 | Dec. 20, 2020 | |
Subsidiary, Sale of Stock [Line Items] | ||||||||
Preferred stock par value | $ 10 | $ 10 | ||||||
Percentage of noncumulative preferred stock | 5.00% | |||||||
Preferred stock, liquidation preference per share | $ 10 | |||||||
Preferred stock, shares authorized | 500,000 | 500,000 | ||||||
Preferred stock, shares outstanding | 9,411 | 9,411 | ||||||
Dividends payable rate | 5.00% | |||||||
Number of Common shares issued for preferred stock dividend | 4,530 | 4,254 | ||||||
Preferred share,dividend per share | $ 5 | |||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||||||
Common Stock, Shares Authorized | 120,000,000 | 100,000,000 | 120,000,000 | 100,000,000 | ||||
Common Stock, Shares, Outstanding | 86,317,096 | 47,595,206 | ||||||
Public Offering [Member] | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Number of shares issued | 21,562,500 | 15,333,334 | 13,416,667 | 7,733,750 | ||||
Common stock price per share | $ 0.56 | $ 0.375 | $ 0.60 | $ 2.10 | ||||
Proceeds from offering | $ 11,254 | $ 5,310 | $ 7,474 | $ 14,867 | $ 16,564 |
Summary of Non-vested Restricte
Summary of Non-vested Restricted Stock Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unvested Shares, Issued | 9,417,898 | |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unvested Shares, beginning balance | 598,370 | |
Issuable Shares, beginning balance | ||
Fair Value Unvested, beginning balance | $ 592 | |
Weighted Average Grant Date Fair Value, Unvested, beginning balance | $ 1.63 | |
Unvested Shares, Granted | 594,740 | 46,035 |
Issuable Shares, Granted | ||
Fair Value, Granted | $ 508 | $ 132 |
Weighted Average Grant Date Fair Value, Granted | $ 0.85 | $ 2.88 |
Unvested Shares, Vested | (444,740) | (488,037) |
Issuable Shares, Vested | 444,740 | 488,037 |
Fair Value, Vested | ||
Weighted Average Grant Date Fair Value, Vested | ||
Unvested Shares, Forfeited | (156,368) | |
Issuable Shares, Forfeited | ||
Fair Value, Forfeited | $ (218) | |
Weighted Average Grant Date Fair Value, Forfeited | $ 1.60 | |
Unvested Shares, Issued | ||
Issuable Shares, Issued | (444,740) | (488,037) |
Fair Value, Issued | $ (416) | $ (506) |
Weighted Average Grant Date Fair Value, Issued | ||
Unvested Shares, ending balance | 150,000 | |
Issuable Shares, ending balance | ||
Fair Value, Unvested, ending balance | $ 92 | |
Weighted Average Grant Date Fair Value, Unvested, ending balance | $ 0.89 |
Schedule of Stock Option Activi
Schedule of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Summary of Investment Holdings [Line Items] | ||
Shares, Granted | 9,417,898 | |
Equity Option [Member] | ||
Summary of Investment Holdings [Line Items] | ||
Shares Outstanding, Beginning balance | 3,265,630 | 3,674,286 |
Weighted-Average Exercise Price, Outstanding, Beginning | $ 2.19 | $ 2.16 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Beginning | 7 years 1 month 2 days | 8 years 6 months 10 days |
Aggregate Intrinsic Value, Shares Outstanding, Begining | $ 6 | $ 1,026 |
Shares, Granted | 6,893,752 | 1,431,840 |
Weighted-Average Exercise Price, Granted | $ 0.87 | $ 2.48 |
Shares, Exercised | 37,500 | |
Weighted-Average Exercise Price, Exercised | $ 0.50 | |
Shares, Unvested forfeited or expired | (515,941) | (1,571,794) |
Weighted-Average Exercise Price, Unvested forfeited or expired | $ 2.10 | $ 2.25 |
Shares, Vested forfeited or expired | (188,043) | (268,702) |
Weighted-Average Exercise Price, Vested forfeited or expired | $ 4.20 | $ 3.07 |
Shares Outstanding, Ending Balance | 9,417,898 | 3,265,630 |
Weighted-Average Exercise Price, Outstanding, Ending | $ 1.19 | $ 2.19 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Ending | 8 years 6 months 18 days | 7 years 1 month 2 days |
Aggregate Intrinsic Value, Shares Outstanding, Ending | $ 78 | $ 6 |
Shares, Exercised | (37,500) | |
Shares Exercisable | 2,266,440 | |
Weighted-Average Exercise Price, Exercisable Ending Balance | $ 1.45 | |
Weighted-Average Remaining Contractual Terms (Years), Exercisable Ending Balance | 6 years 1 month 2 days | |
Aggregate Intrinsic Value, Shares Exercisable Ending Balance | $ 78 |
Schedule of Information Regardi
Schedule of Information Regarding Stock Options (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of Shares Outstanding | shares | 9,417,898 |
Weighted Average Exercise Price | $ 1.19 |
Weighted Average Remaining Contractual Life (years) | 8 years 6 months 18 days |
Number of Shares Exercisable | shares | 2,266,440 |
Weighted Average Exercise Price | $ 1.45 |
Exercise Price One [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 0.50 |
Range of Exercise Price, Upper limit | $ 0.88 |
Number of Shares Outstanding | shares | 1,860,300 |
Weighted Average Exercise Price | $ 0.66 |
Weighted Average Remaining Contractual Life (years) | 9 years 18 days |
Number of Shares Exercisable | shares | 860,300 |
Weighted Average Exercise Price | $ 0.50 |
Exercise Price Two [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 0.89 |
Range of Exercise Price, Upper limit | $ 1.34 |
Number of Shares Outstanding | shares | 4,975,952 |
Weighted Average Exercise Price | $ 0.95 |
Weighted Average Remaining Contractual Life (years) | 9 years 8 months 12 days |
Number of Shares Exercisable | shares | |
Weighted Average Exercise Price | |
Exercise Price Three [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 2.49 |
Range of Exercise Price, Upper limit | $ 3.74 |
Number of Shares Outstanding | shares | 1,899,605 |
Weighted Average Exercise Price | $ 1.74 |
Weighted Average Remaining Contractual Life (years) | 5 years 11 months 15 days |
Number of Shares Exercisable | shares | 1,060,240 |
Weighted Average Exercise Price | $ 1.72 |
Exercise Price Four [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 2.49 |
Range of Exercise Price, Upper limit | $ 3.74 |
Number of Shares Outstanding | shares | 582,091 |
Weighted Average Exercise Price | $ 2.78 |
Weighted Average Remaining Contractual Life (years) | 6 years 11 months 1 day |
Number of Shares Exercisable | shares | 245,950 |
Weighted Average Exercise Price | $ 2.69 |
Exercise Price Five [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 5.01 |
Range of Exercise Price, Upper limit | $ 5.01 |
Number of Shares Outstanding | shares | 99,950 |
Weighted Average Exercise Price | $ 3.74 |
Weighted Average Remaining Contractual Life (years) | 1 year 18 days |
Number of Shares Exercisable | shares | 99,950 |
Weighted Average Exercise Price | $ 3.74 |
Share-Based Payments (Details N
Share-Based Payments (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Dec. 21, 2020 | Oct. 31, 2019 | Sep. 11, 2019 | Dec. 13, 2018 | Sep. 29, 2017 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock option description | The exercise price of an option granted under the plan cannot be less than 100% of the fair market value per share of common stock on the date of the grant of the option. Options may not be granted under the plan on or after the tenth anniversary of the adoption of the plan. Incentive stock options granted to a person owning more than 10% of the combined voting power of the common stock cannot be exercisable for more than five years. | |||||||
Value of restricted shares issued | $ 374 | |||||||
Number of option issued | 9,417,898 | |||||||
Stock price | $ 0.59 | $ 0.91 | ||||||
Expected term | 5 months 1 day | 1 year 5 months 1 day | ||||||
Dividend rate | 0.00% | 0.00% | ||||||
Risk-free interest rate | 0.48% | 1.95% | ||||||
Volatility | 76.35% | 83.36% | ||||||
Restricted Common Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock-based compensation | $ 506 | |||||||
Restricted Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares vested immediately | 350,000 | |||||||
Number of shares to be vested during period | 94,740 | |||||||
Number of shares to be vested | 75,000 | |||||||
Vesting period | 4 years | |||||||
Value of restricted shares issued | $ 508 | |||||||
Market price per share | $ 0.85 | $ 2.88 | ||||||
Number of restricted shares, value | $ 416 | $ 506 | ||||||
Aggregate value of unvested compensation | $ 92 | |||||||
Number of unvested shares were forfited | 156,368 | |||||||
Number of shares vested | 444,740 | 488,037 | ||||||
Number of option issued | ||||||||
Restricted Stock [Member] | Members Of Board Of Directors [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of restricted shares issued | 46,035 | |||||||
Number of options vested | 17,652 | |||||||
Value of restricted shares issued | $ 132 | |||||||
Number of shares vested | 46,035 | |||||||
Stock-based compensation | $ 132 | |||||||
Restricted Stock [Member] | Members Of Board Of Directors [Member] | Vested Through Two Thousand Ninteen [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares vested | 28,383 | |||||||
Restricted Stock [Member] | Minimum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Market price per share | $ 0.81 | |||||||
Restricted Stock [Member] | Maximum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Market price per share | $ 0.95 | |||||||
Restricted Stock [Member] | Two Months From The Date Of Grant [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options vested | 47,370 | |||||||
Share-based Payment Arrangement, Option [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares vested immediately | 3,279,376 | |||||||
Number of options vested | 3,279,376 | |||||||
Vesting period | 4 years | |||||||
Aggregate value of unvested compensation | $ 3,561 | |||||||
Stock price | $ 0.59 | |||||||
Outstanding options, intrinsic value | $ 78 | |||||||
Director and Two Executive Employees [Member] | Restricted Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of restricted shares issued | 594,740 | |||||||
Board Of Directors [Member] | Restricted Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares to be vested | 75,000 | |||||||
Vesting period | 4 years | |||||||
Stock issued during period for rescission offer | Restricted Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of restricted shares issued | 784,004 | |||||||
Number of options vested | 185,634 | |||||||
Value of restricted shares issued | $ 1,291 | |||||||
Stock issued during period for rescission offer | Restricted Stock [Member] | Separation Settlement And Release Of Claims Agreement [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of restricted shares issued | 442,002 | |||||||
Number of unvested shares were forfited | 156,368 | |||||||
Employees [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of option issued | 6,558,752 | |||||||
Consultants Board Members and Former Employees [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of option issued | 335,000 | |||||||
Change in valuation | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Options to purchase shares of common stock | 113,330 | |||||||
10. Stock Options and Warrants | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock-based compensation | $ 0 | |||||||
Options to purchase shares of common stock | 60,510 | |||||||
Stock issued during period for rescission offer | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares issued for compensation | 3,500,000 | 3,000,000 | ||||||
Shares issuable for compensation | 1,168,258 | 3,436,864 | ||||||
Stock options expiration period | 10 years | |||||||
Fair value of options granted | $ 911 | |||||||
Expected term | 7 years | |||||||
Dividend rate | 0.00% | |||||||
Volatility | 61.00% | |||||||
Stock issued during period for rescission offer | Minimum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock price | $ 2.33 | |||||||
Risk-free interest rate | 1.39% | |||||||
Stock issued during period for rescission offer | Maximum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock price | $ 3.37 | |||||||
Risk-free interest rate | 2.60% | |||||||
Stock issued during period for rescission offer | Employees [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Vesting period | 4 years | |||||||
Number of options to be issued | 1,258,000 | |||||||
Two Thousand Twenty Compensation Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares issued for compensation | 8,500,000 | |||||||
Shares issuable for compensation | 3,874,048 | |||||||
Two Thousand Twenty Incentive Compensation Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of options to be issued | 4,625,952 | |||||||
Expected term | 5 years 10 months 28 days | |||||||
Dividend rate | 0.00% | |||||||
Risk-free interest rate | 0.48% | |||||||
Two Thousand Twenty Incentive Compensation Plan [Member] | Minimum [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Weighted average volatility | 76.00% | |||||||
2017 Incentive Compensation Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Vesting period | 2 years 8 months 1 day | |||||||
Number of options to be issued | 2,267,800 | |||||||
Stock price | $ 0.87 | |||||||
Stock options expiration period | 10 years | |||||||
Fair value of options granted | $ 3,561 | |||||||
Fair value of vested stock option | $ 1,176 | $ 790 |
Schedule of Warrant Activity (D
Schedule of Warrant Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares Outstanding, Beginning Balance | 138,762 | |
Shares Outstanding, Ending Balance | 138,762 | 138,762 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares Outstanding, Beginning Balance | 6,413,782 | 6,897,277 |
Weighted-Average Exercise Price, Outstanding Beginning Balance | $ 2.06 | $ 2.06 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Beginning Balance | 1 year 6 months 7 days | 2 years 5 months 1 day |
Aggregate Intrinsic Value Shares Outstanding Beginning | $ 1,447 | |
Shares, Granted | 1,000,000 | |
Weighted-Average Exercise Price, Granted | $ 0.64 | |
Shares, Exercised | (283,495) | |
Weighted-Average Exercise Price, Exercised | $ 2.09 | |
Shares, Forfeited or expired | (4,051,541) | (200,000) |
Weighted-Average Exercise Price, Forfeited or expired | $ 2.03 | $ 5.60 |
Shares Outstanding, Ending Balance | 3,362,241 | 6,413,782 |
Weighted-Average Exercise Price, Outstanding Ending Balance | $ 1.56 | $ 2.06 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Ending Balance | 2 years 5 months 26 days | 1 year 6 months 7 days |
Aggregate Intrinsic Value Shares Outstanding Ending | ||
Shares, Exercised | 283,495 | |
Shares Exercisable, Ending Balance | 3,362,241 | |
Weighted-Average Exercise Price, Exercisable Ending Balance | $ 1.56 | |
Weighted-Average Remaining Contractual Terms (Years), Exercisable Ending Balance | 2 years 5 months 26 days | |
Aggregate Intrinsic Value Shares Exercisable |
Schedule of Warrants Outstandin
Schedule of Warrants Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of Shares Outstanding | shares | 9,417,898 |
Weighted Average Exercise Price | $ 1.19 |
Weighted Average Remaining Contractual Life (years) | 8 years 6 months 18 days |
Number of Shares Exercisable | shares | 2,266,440 |
Weighted Average Exercise Price | $ 1.45 |
Warrant [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of Shares Outstanding | shares | 3,362,241 |
Weighted Average Exercise Price | $ 1.56 |
Weighted Average Remaining Contractual Life (years) | 2 years 5 months 26 days |
Number of Shares Exercisable | shares | 3,362,241 |
Weighted Average Exercise Price | $ 1.56 |
Exercise Price One [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 0.50 |
Range of Exercise Price, Upper limit | $ 0.88 |
Number of Shares Outstanding | shares | 1,860,300 |
Weighted Average Exercise Price | $ 0.66 |
Weighted Average Remaining Contractual Life (years) | 9 years 18 days |
Number of Shares Exercisable | shares | 860,300 |
Weighted Average Exercise Price | $ 0.50 |
Exercise Price One [Member] | Warrant [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 0.64 |
Range of Exercise Price, Upper limit | $ 1.55 |
Number of Shares Outstanding | shares | 2,560,194 |
Weighted Average Exercise Price | $ 1.17 |
Weighted Average Remaining Contractual Life (years) | 2 years 11 months 1 day |
Number of Shares Exercisable | shares | 2,560,194 |
Weighted Average Exercise Price | $ 1.17 |
Exercise Price Two [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 0.89 |
Range of Exercise Price, Upper limit | $ 1.34 |
Number of Shares Outstanding | shares | 4,975,952 |
Weighted Average Exercise Price | $ 0.95 |
Weighted Average Remaining Contractual Life (years) | 9 years 8 months 12 days |
Number of Shares Exercisable | shares | |
Weighted Average Exercise Price | |
Exercise Price Two [Member] | Warrant [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price, Lower Limit | 2 |
Range of Exercise Price, Upper limit | $ 4.25 |
Number of Shares Outstanding | shares | 802,047 |
Weighted Average Exercise Price | $ 2.82 |
Weighted Average Remaining Contractual Life (years) | 1 year 1 month 9 days |
Number of Shares Exercisable | shares | 802,047 |
Weighted Average Exercise Price | $ 2.82 |
Stock Warrants (Details Narrati
Stock Warrants (Details Narrative) $ in Thousands | Dec. 11, 2020USD ($)$ / sharesshares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Decrease in fair value of warrant liability | $ | $ (8) | $ (30) | |
Modification of warrants | 4,051,541 | 200,000 | |
Number of warrants exercised | 283,495 | ||
Number of warrants exercised on a cashless basis | 87,485 | ||
Proceeds from warrant exercise | $ | $ 365 | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Warrant term | 5 years | ||
Warrant issued | 1,000,000 | ||
Exercise price | $ / shares | $ 0.64 | ||
Decrease in fair value of warrant liability | $ | $ 402 | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | Measurement Input, Share Price [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fair value assumption | $ / shares | 0.64 | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | Measurement Input, Exercise Price [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fair value assumption | $ / shares | 0.64 | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | Measurement Input, Expected Term [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Warrant term | 5 years | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | Measurement Input, Price Volatility [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fair value assumption | 79 | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | Measurement Input, Expected Dividend Rate [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fair value assumption | 0 | ||
Satisfaction Settlement And Release Agreement [Member] | Raptor Note [Member] | Measurement Input, Discount Rate [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fair value assumption | 0.51 | ||
Stock Warrants [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Warrant to purchase common stock | 3,362,241 | ||
Common Stock [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Exercise of warrants, shares | 223,037 |
Schedule of Deferred Income Tax
Schedule of Deferred Income Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 15,641 | $ 12,776 |
Disqualified corporate interest expense | 857 | 581 |
Stock-based compensation | 1,260 | 942 |
Accounts receivable allowances | 61 | 98 |
Inventory reserves | 51 | 168 |
Operating lease liability | 179 | 181 |
Reserve for asset impairment | 58 | 58 |
Gross deferred tax assets | 18,107 | 14,804 |
Valuation allowance | (17,903) | (14,488) |
Total deferred tax assets | 203 | 316 |
Operating lease right-of-use asset | (203) | (190) |
Deferred finance costs | (126) | |
Total deferred tax liabilities | (203) | (316) |
Net deferred tax asset (liability) |
Schedule of Reconciliation of E
Schedule of Reconciliation of Effective Income Tax Rate to U.S. Statutory Rate (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory tax rate | (21.00%) | (21.00%) |
State rate, net of federal benefit | (5.00%) | (5.00%) |
Federal and state tax rate | (26.00%) | (26.00%) |
Effect of change in tax rate | ||
Valuation allowance | 26.00% | 26.00% |
Effective tax rate |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Loss Carryforwards [Line Items] | ||||
Federal net operating loss carryforwards | $ 66,000 | $ 58,000 | ||
State net operating loss carryforwards | $ 42,000 | 34,000 | ||
Federal carryforward loss expires year | 2037 | |||
Operating loss carryforwards, limitations on use | offset 80% of taxable income in future years. | |||
Domestic Tax Authority [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | $ 33,000 | $ 33,000 | $ 33,000 | $ 33,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Royalty [Member] | |||
Related Party Transaction [Line Items] | |||
Royalty revenue | $ 98 | $ 128 | |
Chris Reed [Member] | |||
Related Party Transaction [Line Items] | |||
Deposit of security with lessor | $ 800 | ||
Number of common stock value placed | 363,000 | ||
Value of common stock paced | $ 338 | ||
Chris Reed [Member] | California Custom Beverage, LLC [Member] | |||
Related Party Transaction [Line Items] | |||
Deposit of security with lessor | $ 1,200 | ||
Royalty percentage | 5.00% | ||
Referral fee percentage | 5.00% | ||
Royalty revenue receivable | $ 128 | ||
Inventory advances | 228 | ||
Receivable from related party | 682 | 356 | |
Inventory and equipment advances | 381 | ||
Reduction in receivable from related party | 153 | ||
Offseting payable | 153 | ||
Accounts payable due to related parties | 557 | 182 | |
Lindsay Martin [Member] | Vice President [Member] | |||
Related Party Transaction [Line Items] | |||
Amount paid for service | $ 215 | $ 161 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Mar. 25, 2021 | Mar. 11, 2021 | Jan. 26, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Feb. 19, 2021 | Dec. 02, 2020 |
Subsequent Event [Line Items] | |||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | |||||
Common Stock [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Number of restricted stock issued | 442,002 | ||||||
Exercise of options, shares | 37,500 | ||||||
Maximum [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Common stock, par value | $ 1 | ||||||
Subsequent Event [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Exercise of options, shares | 6,000 | ||||||
Subsequent Event [Member] | Common Stock [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Number of shares issued | 86,225 | ||||||
Subsequent Event [Member] | Minimum [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Common stock, par value | $ 1 | ||||||
Subsequent Event [Member] | Board of Directors Chairman [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Common stock, voting rights | He is also a greater than 5% beneficial owner of Reed’s common stock. | ||||||
Number of restricted stock issued | 400,000 | ||||||
Subsequent Event [Member] | Non Employee Directors [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Cash compensation | $ 50,000 | ||||||
Subsequent Event [Member] | Non Employee Directors [Member] | Restricted Stock [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Number of shares awarded | 49,180 | ||||||
Subsequent Event [Member] | Director [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Number of restricted stock issued | 61,475 | ||||||
Subsequent Event [Member] | Executive [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Number of restricted stock issued | 18,750 | ||||||
Subsequent Event [Member] | Letter of Credit [Member] | Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Line of credit facility | $ 2,000,000 | ||||||
Subsequent Event [Member] | Letter of Credit [Member] | Daniel J. Doherty [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Line of credit facility | $ 1,500,000 |