Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 01, 2022 | Mar. 11, 2022 | Jul. 02, 2021 | |
Document and Entity Information | |||
Entity Registrant Name | SUMMER INFANT, INC. | ||
Document Type | 10-K | ||
Document Annual Report | true | ||
Current Fiscal Year End Date | --01-01 | ||
Document Period End Date | Jan. 1, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 001-33346 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-1994619 | ||
Entity Address, Address Line One | 1275 Park East Drive | ||
Entity Address, City or Town | Woonsocket | ||
Entity Address, State or Province | RI | ||
Entity Address, Postal Zip Code | 02895 | ||
City Area Code | 401 | ||
Local Phone Number | 671-6550 | ||
Title of 12(b) Security | Common Stock, Par Value $0.0001 | ||
Trading Symbol | SUMR | ||
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 | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 10.9 | ||
Entity Common Stock, Shares Outstanding | 2,164,708 | ||
Entity Central Index Key | 0001314772 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Firm ID | 49 | ||
Auditor Name | RSM US LLP | ||
Auditor Location | Boston, Massachusetts |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 535 | $ 510 |
Trade receivables, net of allowance for doubtful accounts of $14 and $197 at January 1, 2022 and January 2, 2021, respectively | 30,934 | 25,995 |
Inventory, net | 28,621 | 25,123 |
Prepaids and other current assets | 1,143 | 1,850 |
TOTAL CURRENT ASSETS | 61,233 | 53,478 |
Property and equipment, net | 4,128 | 4,789 |
Intangible assets, net | 11,382 | 11,739 |
Right of use assets | 14,383 | 3,625 |
Deferred tax assets, net | 1,001 | |
Other assets | 104 | 105 |
TOTAL ASSETS | 91,230 | 74,737 |
CURRENT LIABILITIES | ||
Accounts payable | 27,985 | 27,986 |
Accrued expenses | 5,698 | 6,064 |
Lease liabilities, current | 3,133 | 2,349 |
Current portion of long-term debt | 2,125 | 2,125 |
TOTAL CURRENT LIABILITIES | 38,941 | 38,524 |
Long-term debt, less current portion and unamortized debt issuance costs | 37,420 | 27,536 |
Deferred tax liability | 152 | |
Lease liabilities, noncurrent | 12,034 | 1,493 |
Other liabilities | 108 | 2,064 |
TOTAL LIABILITIES | 88,655 | 69,617 |
STOCKHOLDERS' EQUITY | ||
Preferred Stock, $0.0001 par value, 1,000,000 authorized, none issued or outstanding at January 1, 2022 and January 2, 2021 | ||
Common Stock $0.0001 par value, authorized, issued and outstanding of 49,000,000, 2,194,892, and 2,164,708 at January 1, 2022 and 49,000,000, 2,162,459, and 2,132,275 at January 2, 2021, respectively | 2 | 2 |
Treasury Stock at cost (30,184 shares at January 1, 2022 and January 2, 2021) | (1,283) | (1,283) |
Additional paid-in capital | 78,370 | 77,979 |
Accumulated deficit | (73,088) | (70,190) |
Accumulated other comprehensive loss | (1,426) | (1,388) |
TOTAL STOCKHOLDERS' EQUITY | 2,575 | 5,120 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 91,230 | $ 74,737 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Consolidated Balance Sheets | ||
Trade receivables, allowance for doubtful accounts | $ 14 | $ 197 |
Preferred Stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred Stock, authorized | 1,000,000 | 1,000,000 |
Preferred Stock, issued | 0 | 0 |
Preferred Stock, outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common Stock, authorized | 49,000,000 | 49,000,000 |
Common Stock, issued | 2,194,892 | 2,162,459 |
Common Stock, outstanding | 2,164,708 | 2,132,275 |
Treasury Stock at cost, shares | 30,184 | 30,184 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Consolidated Statements of Operations | ||
Net sales | $ 143,665 | $ 155,299 |
Cost of goods sold | 104,286 | 104,448 |
Gross profit | 39,379 | 50,851 |
General and administrative expenses | 28,662 | 29,360 |
Selling expenses | 10,785 | 12,574 |
Depreciation and amortization | 2,239 | 3,348 |
Impairment of intangible asset | 676 | |
Operating (loss) income | (2,307) | 4,893 |
Interest expense, net | 1,386 | 4,078 |
(Gain) loss from extinguishment of debt | (1,972) | 1,800 |
Loss before provision for income taxes | (1,721) | (985) |
Provision for income taxes | 1,177 | 117 |
Net loss | $ (2,898) | $ (1,102) |
Net loss per share: | ||
BASIC | $ (1.35) | $ (0.52) |
DILUTED | $ (1.35) | $ (0.52) |
Weighted average shares outstanding: | ||
BASIC | 2,152,926 | 2,119,499 |
DILUTED | 2,152,926 | 2,119,499 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Consolidated Statements of Comprehensive Loss | ||
Net loss | $ (2,898) | $ (1,102) |
Other comprehensive loss: | ||
Foreign currency translation adjustments | (38) | 375 |
Comprehensive loss | $ (2,936) | $ (727) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (2,898) | $ (1,102) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 2,239 | 3,348 |
Impairment of intangible asset | 676 | |
Stock-based compensation | 327 | 253 |
(Gain) loss from extinguishment of debt | (1,972) | 1,800 |
Amortization of deferred financing costs | 294 | 651 |
Deferred income taxes | 1,143 | 5 |
Amortization of right to use asset | 2,999 | 2,431 |
Changes in assets and liabilities | ||
(Increase) decrease in accounts receivable | (4,995) | 6,763 |
(Increase) decrease in inventory | (3,571) | 2,926 |
Decrease in lease liabilities | (2,431) | (2,678) |
Decrease in prepaids and other assets | 721 | 1,118 |
Increase in accounts payable and accrued expenses | (247) | 1,416 |
Net cash (used in) provided by operating activities | (8,391) | 17,607 |
Cash flows from investing activities: | ||
Acquisitions of property and equipment | (1,160) | (1,258) |
Acquisitions of intangible assets | (87) | (20) |
Net cash used in investing activities | (1,247) | (1,278) |
Cash flows from financing activities: | ||
Repayment of Prior Term Loan Facility | (16,406) | |
Payment of financing fees and other costs | (1,522) | |
Proceeds from New Term Loan Facility | 7,500 | |
Proceeds from FILO Loan Facility | 2,500 | |
Repayment of New Term Loan Facility | (1,500) | (375) |
Repayment of FILO Loan Facility | (625) | (156) |
Net borrowings (repayment) on revolving facilities | 11,714 | (10,152) |
Issuance of common stock upon exercise of stock options | 64 | 11 |
Proceeds from PPP loan | 1,956 | |
Net cash provided by (used in) financing activities | 9,653 | (16,644) |
Effect of exchange rate changes on cash and cash equivalents | 10 | 430 |
Net increase in cash and cash equivalents | 25 | 115 |
Cash and cash equivalents, beginning of year | 510 | 395 |
Cash and cash equivalents, end of year | 535 | 510 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the year for interest | 1,131 | 2,777 |
Cash paid (refunded) during the year for income taxes | 8 | (199) |
Supplemental disclosure of non-cash investing and financing activities: | ||
Derecognition of a building sale-leaseback fixed asset, net of depreciation | 2,357 | |
Derecognition of a building sale-leaseback financial obligation | (2,390) | |
Right-of-use asset acquired through new operating lease | 13,802 | (1,457) |
Lease liability acquired through new operating lease | $ (13,802) | $ 1,457 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid in Capital | Treasury Stock | Accumulated Deficit | Accumulated Comprehensive Loss | Total |
Balance, beginning of year at Dec. 28, 2019 | $ 2 | $ 77,715 | $ (1,283) | $ (69,088) | $ (1,763) | $ 5,583 |
Balance, beginning of year (in shares) at Dec. 28, 2019 | 2,108,743 | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Issuance of common stock upon vesting of restricted shares (in shares) | 20,438 | |||||
Issuance of common stock upon exercise of stock options | 11 | 11 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 1,474 | |||||
Stock-based compensation | 253 | 253 | ||||
Fractional share issuance upon reverse stock split | 1,620 | |||||
Net loss for the year | (1,102) | (1,102) | ||||
Foreign currency translation adjustment | 375 | 375 | ||||
Balance, end of year at Jan. 02, 2021 | $ 2 | 77,979 | (1,283) | (70,190) | (1,388) | 5,120 |
Balance, end of year (in shares) at Jan. 02, 2021 | 2,132,275 | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Issuance of common stock upon vesting of restricted shares (in shares) | 24,468 | |||||
Issuance of common stock upon exercise of stock options | 64 | 64 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 7,965 | |||||
Stock-based compensation | 327 | 327 | ||||
Net loss for the year | (2,898) | (2,898) | ||||
Foreign currency translation adjustment | (38) | (38) | ||||
Balance, end of year at Jan. 01, 2022 | $ 2 | $ 78,370 | $ (1,283) | $ (73,088) | $ (1,426) | $ 2,575 |
Balance, end of year (in shares) at Jan. 01, 2022 | 2,164,708 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jan. 01, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations The Company designs, markets and distributes branded juvenile safety and convenience products that are sold globally to national retailers as well as independent retailers, primarily in North America. The Company currently markets its products in several product categories including gates, potty, bath, entertainers, specialty blankets, strollers, car seats and travel systems. Most products are sold under our core brand names of Summer™ and SwaddleMe ® 2022 Plan and COVID-19 Pandemic The accompanying consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will continue to operate as a going concern and contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. For the year ended January 1, 2022, the Company incurred a net loss $2,898 and used cash in operating activities of $8,391, primarily a result of the growth of accounts receivable and inventory. As of January 1, 2022, the Company had $535 of cash, $40,572 of outstanding indebtedness and borrowing availability of $2,949 under its asset-based lending agreement. Since January 1, 2022, the Company entered into a term loan agreement with Wynnefield Capital to provide additional availability to the Company. While the Company’s asset-based loan agreement with Bank of America and term loan agreement with Wynnefield Capital do not expire until October 15, 2025, both agreements have adjusted EBITDA and liquidity covenants. While these covenants provide room for the Company to conduct its business in the ordinary course, the Company currently faces a challenging supply chain environment that may impact its ability to execute on its operating plan and consequently, the Company amended its financial covenants with Bank of America and Wynnefield Capital on March 16, 2022. Due to continuing losses, the Company’s financial position and the challenging supply chain environment, there is no assurance that Company will be able to maintain compliance with the financial covenants under its loan agreements, which would impair its ability to meet its financial obligations as they become due without future amendments to its loan agreements. In addition, the COVID-19 pandemic has significantly increased economic and demand uncertainty across the globe, and while demand for the Company’s products has remained steady, if these challenges continue, the Company may not be able to meet demands of its customers which could result in lost or cancelled orders from our customers and could materially and adversely affect our business, financial condition, and results of operations. Based on its known cash needs as of March 16, 2022, and the anticipated availability under its loan agreements, the Company has developed plans to extend its liquidity to support its working capital requirements and our ability to meet our financial obligations. The Company’s plans with regard to these matters include the following: (1) continuing to explore price increases where possible, (2) enhancing certain supply chain processes to obtain lower cost containers for its products and reduce demurrage and detention charges through additional new procedures, (3) reducing warehouse costs through new processes as it relates to pallets, (4) reducing product costs through re-engineering of certain products, (5) reducing discretionary marketing to the extent that it does not impact revenue performance, and (6) considering additional financing and/or strategic alternatives. However, there can be no assurance the Company’s plans will be achieved and that the Company will be able to meet its financial obligations as they become due without obtaining additional financing or sources of capital. Therefore, in accordance with applicable accounting guidance, and based on the Company’s current financial condition and availability of funds, there is substantial doubt about the Company’s ability to continue as a going concern through twelve months from the date these financial statements were issued. Reverse Stock Split On March 13, 2020, the Company completed a reverse stock split and reduced its common stock outstanding by a ratio of one for nine Basis of Presentation and Principles of Consolidation It is the Company’s policy to prepare its financial statements on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in the consolidation. All dollar amounts included in the Notes to Consolidated Financial Statements are in thousands of U.S. dollars except share and per share amounts. Fiscal Year The Company’s fiscal year ends on the Saturday closest to December 31 of each calendar year. There were fifty-two fifty-three Summary of Significant Accounting Policies Revenue Recognition The Company applies FASB ASC Topic 606, Revenue from Contracts with Customers The Company’s principal activities from which it generates its revenue is product sales. The Company has one reportable segment of business. Revenue is measured based on consideration specified in a contract with a customer. The Company recognizes revenue when it satisfies a performance obligation in a contract by transferring control over a product to a customer when product delivery occurs. Consideration is typically paid approximately 60 days from the time control is transferred. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in selling costs. A performance obligation is a promise in a contract to transfer a distinct product to the customer, which for the Company is transfer of primarily juvenile products to its customers. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. A transaction price is the amount of consideration the Company expects to receive under the arrangement. The Company is required to estimate variable consideration (if any) and to factor that estimation into the determination of the transaction price. The Company conducts its business with customers through valid purchase or sales orders each of which is considered a separate contract because individual orders are not interdependent on one another. Product transaction prices on a purchase or sale order are discrete and stand-alone. Purchase or sales orders may be issued under either a customer master service agreement or a reseller allowance agreement. Purchase or sales orders, master service agreements, and reseller allowance agreements which are specific and unique to each customer, may include product price discounts, markdown allowances, return allowances, and/or volume rebates which reduce the consideration due from customers. Variable consideration is estimated using the most likely amount method, which is based on our historical experience as well as current information such as sales forecasts. Contracts may also include cooperative advertising arrangements where the Company allows a discount from invoiced product amounts in exchange for customer purchased advertising that features the Company’s products. These allowances are generally based upon product purchases or specific advertising campaigns. Such allowances are accrued when the related revenue is recognized. These cooperative advertising arrangements provide a distinct benefit and fair value and are accounted for as direct selling expenses. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Accordingly, actual results could differ from those estimates. Cash and Cash Equivalents Cash flows, cash and cash equivalents include money market accounts and investments with an original maturity of three months or less. At times, the Company possesses cash balances in excess of federally-insured limits. Trade Receivables Trade receivables are carried at their outstanding unpaid principal balances reduced by an allowance for doubtful accounts. The Company estimates doubtful accounts based on historical bad debts, factors related to specific customers’ ability to pay and current economic trends. The Company writes off accounts receivable against the allowance when a balance is determined to be uncollectible. Amounts are considered to be uncollectable based upon historical experience and management’s evaluation of outstanding accounts receivable. Changes in the allowance for doubtful accounts are as follows: For the fiscal year ended January 1, January 2, 2022 2021 Allowance for doubtful accounts, beginning of period $ 197 $ 542 Charges to (recovery of) costs and expenses 8 (27) Account write-offs and other (191) (318) Allowance for doubtful accounts, end of period $ 14 $ 197 Inventory Valuation Inventory is comprised mostly of finished goods and some component parts and is stated at the lower of cost using the first-in, first-out (FIFO) method, or net realizable value. The Company regularly reviews slow-moving and excess inventories and writes down inventories to net realizable value if the ultimate expected net proceeds from the disposals of excess inventory are less than the carrying cost of the merchandise. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and lease liabilities in the Company’s consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company’s uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The components of a lease should be split into three categories: lease components (e.g., land, building, etc.), non-lease components (e.g., common area maintenance, maintenance, consumables, etc.), and non-components (e.g., property taxes, insurance, etc.). Then the fixed and in-substance fixed contract consideration (including any related to non-components) must be allocated based on fair values to the lease components and non-lease components. Although separation of lease and non-lease components is required, certain practical expedients are available to entities. Entities electing the practical expedient would not separate lease and non-lease components. Rather, they would account for each lease component and the related non-lease component together as a single component. The Company’s facilities operating leases have lease and non-lease components to which the Company has elected to apply the practical expedient and account for each lease component and related non-lease component as one single component. The lease component results in a ROU asset being recorded on the balance sheet. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Property and Equipment Property and equipment are recorded at cost. The Company owns the tools and molds used in the production of its products by third party manufacturers. Capitalized mold costs include costs incurred for the pre-production design and development of the molds. Depreciation is provided over the estimated useful lives of the respective assets using the straight-line method. Long-Lived Assets with Finite Lives The Company reviews long-lived assets with finite lives for impairment on an asset group level whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. An asset is considered to be impaired when its carrying amount exceeds both the sum of the undiscounted future net cash flows expected to result from the use of the asset and its eventual disposition and the assets’ fair value. Long-lived assets include property and equipment and finite-lived intangible assets. The amount of impairment loss, if any, is charged by the Company to current operations. Indefinite-Lived Intangible Assets The Company accounts for intangible assets in accordance with accounting guidance that requires that intangible assets with indefinite useful lives be tested annually for impairment and more frequently if events or changes in circumstances indicate that the asset might be impaired. The Company’s annual impairment testing is conducted in the fourth quarter of every year. The Company tests indefinite-lived intangible assets for impairment by comparing the asset’s fair value to its carrying amount. If the fair value is less than the carrying amount, the excess of the carrying amount over fair value is recognized as an impairment charge and the adjusted carrying amount becomes the assets’ new cost basis. Management also evaluates the remaining useful life of an intangible asset that is not being amortized each reporting period to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is subsequently determined to have a finite useful life, it is amortized prospectively over its estimated remaining useful life. Fair Value Measurements The Company follows ASC 820, “Fair Value Measurements and Disclosures” which includes a framework for measuring fair value and expanded related disclosures. Broadly, the framework requires fair value to be determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The standard established a three-level valuation hierarchy based upon observable and non-observable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy: Level 1—Quoted prices for identical instruments in active markets. Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3—Significant inputs to the valuation model are unobservable. The Company maintains policies and procedures to value instruments using the best and most relevant data available. In addition, the Company utilizes third party specialists that review valuation, including independent price validation. The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and short and long-term borrowings. Because of their short maturity, the carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value. The carrying value of the Company’s debt approximates fair value since the stated rate is similar to rates currently available to the Company for debt with similar terms and remaining maturities. The Company’s assets measured at fair value on a nonrecurring basis include long-lived assets and finite-lived intangibles. The Company tests its indefinite-lived assets for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value may not be recoverable or that the carrying value may exceed its fair value. The resulting fair value measurements are considered to be Level 3 inputs. The Company did not record an impairment charge in fiscal 2021. During the fourth quarter of fiscal 2020, the Company determined that the estimated fair value of a definite-lived asset was non-recoverable, and the Company recorded a non-cash impairment charge of $676 which reduced the value of the intangible asset to $0, as more fully described in “Note 4 to the Consolidated Financial Statements-Intangible Assets.” Income taxes Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence, it is more likely than not that such benefits will be realized. Deferred income tax assets are recorded on a net basis as a long term asset. The Company follows the applicable guidance relative to uncertain tax positions. This standard provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Uncertain tax positions must meet a recognition threshold of more-likely-than-not in order for those tax positions to be recognized in the financial statements. Translation of Foreign Currencies Assets and liabilities of the Company’s foreign subsidiaries whose functional currency is its local currency, are translated into U.S. dollars at the exchange rate in effect at the end of the quarter and the income and expense accounts of these affiliates have been translated at average rates prevailing during each respective quarter. Resulting translation adjustments are made to a separate component of stockholders’ equity within accumulated other comprehensive loss. Assets and liabilities of the Company’s foreign subsidiaries whose functional currency is the U.S. dollar are remeasured into U.S. dollars at their historical rates or the exchange rate in effect at the end of the quarter and the income and expense accounts of these affiliates have been remeasured at average rates prevailing during each respective quarter. Resulting remeasurement adjustments are made to the consolidated statement of operations. Foreign exchange transaction gains and losses are included in the accompanying consolidated statement of operations. Shipping Costs Shipping costs to customers are included in selling expenses and amounted to approximately $2,206 and $2,485 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. Advertising Costs The Company charges advertising costs to selling expense as incurred. Advertising expense, which consists primarily of promotional and cooperative advertising allowances provided to customers, was approximately $7,881 and $9,215 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. Segment Information Operating segments are identified as components of an enterprise about which separate, discrete financial information is available for evaluation by the chief operating decision-maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company views its operations and manages its business as one operating segment utilizing an omni-channel distribution strategy. Net Loss Per Share Basic loss per share for the Company is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted income or loss per share includes the dilutive impact of outstanding stock options and unvested restricted shares. Diluted loss per share for the Company is computed by dividing net loss by the dilutive weighted average shares outstanding which includes: the dilutive impact (using the “treasury stock” method) of “in the money” stock options and unvested restricted shares issued to employees. Options to purchase 70,635 and 60,639 shares of the Company’s common stock and 6,072 and 14,967 of restricted shares were not included in the calculation, due to the fact that these instruments were anti-dilutive for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. New Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and a subsequent amendment to the initial guidance, ASU 2018-19 Codification Improvements to Topic 325, Financial Instruments-Credit Losses (collectively, Topic 326). Topic 326 requires measurement and recognition of expected credit losses for financial assets held, which include, but are not limited to, trade and other receivables. The new standard is effective for fiscal years beginning after December 15, 2022. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements. |
REVENUE
REVENUE | 12 Months Ended |
Jan. 01, 2022 | |
REVENUE | |
REVENUE | 2. REVENUE Disaggregation of Revenue The Company’s revenue is primarily from distinct fixed-price product sales in the juvenile product market, to similar customers and channels utilizing similar types of contracts that are short term in nature (less than one year). The Company does not sell service agreements or goods over a period of time and does not sell or utilize customer financing arrangements or time-and-material contracts. The following is a table that presents net sales by geographical area: For the fiscal year ended January 1, January 2, 2022 2021 United States $ 132,153 $ 140,173 All Other 11,512 15,126 $ 143,665 $ 155,299 All Other consists of Canada, Europe, South America, Mexico, Asia, and the Middle East. Contract Balances The Company does not have any contract assets such as work-in-process or contract liabilities such as customer advances. All trade receivables on the Company’s consolidated balance sheet are from contracts with customers. Contract Costs Costs incurred to obtain a contract are capitalized unless short term in nature. As a practical expedient, costs to obtain a contract that are short term in nature are expensed as incurred. All contract costs incurred in 2021 and 2020 fall under the provisions of the practical expedient and have therefore been expensed. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Jan. 01, 2022 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | 3. PROPERTY AND EQUIPMENT Property and equipment, at cost, consisted of the following: For the fiscal year ended January 1, January 2, Depreciation/ 2022 2021 Amortization Period Computer-related $ 4,577 $ 4,560 5 years Tools, dies, prototypes, and molds 28,826 27,849 1 - 5 years Other 7,777 7,671 1 - 15 years 41,180 40,080 Less: accumulated depreciation 37,052 35,291 Property and equipment, net $ 4,128 $ 4,789 Total depreciation expense was $1,795 and $2,847 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. In May 2020, the Company entered into a lease agreement amendment related to our headquarters in Woonsocket, Rhode Island. The agreement decreased the leased premises square footage and extended the current term, which was set to end in March 2021 prior to the amendment to June 2025. It additionally granted two 5-year term extension options. The Company was accounting for the lease in Woonsocket as a sale-leaseback with the building on the balance sheet as property and equipment, net and a corresponding financing obligation in long-term liabilities. Upon the execution of the lease amendment, the Company re-assessed the classification of the lease and determined it to be an operating lease, as the criteria for a sale-leaseback had not been met. This resulted in the de-recognition of the building, from property and equipment, of $2,357, net of accumulated depreciation and the addition of a right-of-use asset and corresponding liability of $1,457. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Jan. 01, 2022 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | 4. INTANGIBLE ASSETS Intangible assets consisted of the following: For the fiscal year ended January 1, January 2, 2022 2021 Brand names $ 10,900 $ 10,900 Patents and licenses 4,208 4,125 Customer relationships 6,946 6,946 Other intangibles 1,886 1,882 23,940 23,853 Less: accumulated amortization (12,558) (12,114) Intangible assets, net $ 11,382 $ 11,739 The amortization period for the majority of the intangible assets ranges from 5 to 18 years for those assets that have an estimated life; certain assets have indefinite lives (a brand name). Total of intangibles not subject to amortization amounted to $8,400 for the fiscal years ended January 1, 2022 and January 2, 2021. Amortization expense amounted to $444 and $501 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. In the fourth quarter of 2020, the Company recorded an asset impairment charge of $676 representing the remaining unamortized balance of the definite long-lived asset related to the Company’s Born Free Holdings Limited (BFH) trademarks. This intangible asset was determined to have a carrying value that was non-recoverable. The determination resulted from the Company’s decision to dissolve the BFH entity which was completed in December 2020. The Company performed its annual indefinite-lived intangible asset impairment analysis in the fourth fiscal quarter. No asset impairment was recorded for the fiscal years ended January 1, 2022 and January 2, 2021. Estimated amortization expense for the remaining definite-lived assets for the next five years is as follows: Fiscal Year ending 2022 440 2023 440 2024 440 2025 437 2026 207 |
DEBT
DEBT | 12 Months Ended |
Jan. 01, 2022 | |
DEBT | |
DEBT | 5. DEBT Loan Agreement with Bank of America. On October 15, 2020, the Company and its wholly owned subsidiary, Summer Infant (USA), Inc., became parties to a Third Amended and Restated Loan and Security Agreement (the “Loan Agreement”) with Bank of America, N.A., as agent, that provides for (i) a $40,000 asset-based revolving credit facility, with a $5,000 unused letter of credit sub-line facility as of January 1, 2022, (ii) a $7,500 term loan and (iii) a $2,500 FILO (first-in, last-out) loan. The Loan Agreement replaced the Company’s prior agreement with BofA and term loan with Pathlight Capital. Pursuant to the Loan Agreement, total borrowing capacity under the revolving credit facility is based on a borrowing base, which is generally defined as 85% of eligible receivables plus the lesser of (i) 70% of the value of eligible inventory (subject to certain limitations) or (ii) 85% of the net orderly liquidation value of eligible inventory, less applicable reserves. The scheduled maturity date of the loans under the revolving credit facility is October 15, 2025 (subject to customary early termination provisions). Loans under the revolving credit facility bear interest, at the Company’s option, at a base rate or at LIBOR, plus applicable margins based on average quarterly availability. Interest payments are due monthly, payable in arrears. The Company is also required to pay an annual non-use fee on unused amounts under the revolving credit facility, as well as other customary fees as are set forth in the Loan Agreement. As of January 1, 2022, the interest rate on LIBOR based revolver loans and on base rate revolver loans was 2.625% and 4.500%, respectively. The amount outstanding on the revolving credit facility Agreement on January 1, 2022 was $33,228. As of January 2, 2021, the interest rate was 2.625% on LIBOR based revolver loans. The amount outstanding on the Restated BofA Agreement at January 2, 2021 was $21,467. Total borrowing base at January 1, 2022 was $36,177 and borrowing availability was $2,949. The principal of the term loan is to be repaid, on a quarterly basis, in installments of $375, until paid in full on termination and subject to mandatory repayment in certain circumstances. The scheduled maturity date of the term loan is October 15, 2025 or earlier, if the revolving credit facility is terminated. The term loan bears interest, at the Company’s option, at a base rate or at LIBOR, plus applicable margins, and interest payments are due monthly, in arrears. As of January 1, 2022, the interest rate on LIBOR based term loans and on base rate term loans was 3.875% and 5.750%, respectively. The amount outstanding on the term loan under the Restated BofA Agreement was $5,625 as of January 1, 2022. The amount outstanding on the term loan under the Restated BofA Agreement was $7,125 as of January 2, 2021. The total borrowing capacity under the FILO loan is the lesser of (i) the then applicable aggregate FILO commitment amount and (ii) a borrowing base, generally defined as a specific percentage of the value of eligible accounts, plus a specified percentage of the value of eligible inventory. The aggregate FILO commitment amount as of January 1, 2022 was $1,719 with no further availability, and such amount will be proportionately reduced each quarter until the FILO loan is terminated at maturity on October 15, 2024. There can be no voluntary repayment on the FILO loan as long as there are loans outstanding under the revolving credit facility, unless (i) there is an overadvance under the FILO loan, or (ii) such prepayment is accompanied by a permanent dollar for dollar reduction in the aggregate FILO commitment amount such that, after giving effect to such prepayment and reduction, the outstanding principal amount of the FILO loan is equal to but does not exceed the lesser of (A) the aggregate FILO commitment amount and (B) the FILO borrowing base. The FILO loan bears interest, at the Company’s option, at a base rate or at LIBOR, plus applicable margins, and interest payments are due monthly, in arrears. As of January 1, 2022, the interest rate on the LIBOR based FILO loans and on base rate FILO loans was 3.625% and 5.500%, respectively. The aggregate FILO commitment amount of as of January 2, 2021 was $2,344. All obligations under the Loan Agreement are secured by substantially all the assets of the Company, and the Company’s subsidiaries, Summer Infant Canada Limited and Summer Infant Europe Limited, are guarantors under the Loan Agreement. The Loan Agreement contains customary affirmative and negative covenants. Among other restrictions, the Company is restricted in its ability to incur additional debt, make acquisitions or investments, dispose of assets, or make distributions unless in each case certain conditions are satisfied. Until the term loan and FILO loan have been repaid in full, the Company must maintain a fixed charge coverage ratio at the end of each fiscal month of at least 1.00 to 1.00 for the twelve-month period then ended. After the term loan and FILO loan have been repaid in full, the Company will be required to maintain the fixed charge coverage ratio if availability falls below $5,000. The Loan Agreement also contains customary events of default, including if the Company fails to comply with any required financial covenants, if there is an event of default under the PPP Loan (described below) and the occurrence of a change of control. In the event of a default, all of the obligations under the Loan Agreement may be declared immediately due and payable. For certain events of default relating to insolvency and receivership, all outstanding obligations become due and payable. Subsequent to fiscal year end, on January 28, 2022 and March 16, 2022, the Company (i) entered into a loan and security agreement with Wynnefield Capital, Inc., as agent, providing for a second lien, subordinated term loan in an amount up to $5,000 and (ii) amended the Loan Agreement to provide additional flexibility to the Company under its covenant requirements and to permit the second-lien term, subordinated term loan. See Note 13 for additional information regarding the new second lien, subordinated term loan and Loan Agreement amendment. Prior Bank of America Credit Facility. Prior Term Loan Agreement. term loan (the “Term Loan”). The principal of the Term Loan was being repaid, on a quarterly basis, in installments of $219, with the first installment having been paid on December 1, 2018, until paid in full on termination, provided that, in connection with the amendments to the Term Loan Agreement, principal payments for March, June and September 2020 were suspended. The Term Loan was repaid in full on October 15, 2020. The refinancing transaction was evaluated to determine the proper accounting treatment for the transaction. Accordingly, debt extinguishment accounting was used to account for the prepayment of the prior term loan facility with Pathlight Capital, LLC, resulting in a loss from the extinguishment of debt of $1,800 for the twelve months ended January 2, 2021. PPP Loan On August 3, 2020, the Company received loan proceeds of $1,956 (the “PPP Loan”) pursuant to the Paycheck Protection Program (“PPP”) administered by the U.S. Small Business Administration (“SBA”) under the U.S. CARES Act. The PPP Loan, which was in the form of a promissory note (the “PPP Note”), between the Company and BofA, as the lender, had a maturity date of July 27, 2025 and would bear interest at a fixed rate of 1% per annum. Monthly principal and interest payments were deferred until (i) the date on which the amount of forgiveness was remitted to the Company’s lender, (ii) the date on which the Company’s lender provided notice that the Company was not entitled to loan forgiveness, and (iii) if a borrower did not apply for loan forgiveness, 10 months after the date of the loan forgiveness covered period. The Company was permitted to voluntarily prepay the borrowings in full with no associated penalty or premium. Under the terms of the PPP, the principal and interest could be forgiven if the PPP Loan proceeds were used for qualifying expenses, including payroll costs, rent and utility costs. The PPP Note contained customary representations, warranties, and covenants for this type of transaction, including customary events of default relating to, among other things, payment defaults and breaches of representations and warranties or other provisions of the PPP Note. The occurrence of an event of default could have resulted in, among other things, the Company becoming obligated to repay all amounts outstanding under the PPP Note. On February 18, 2021, the Company applied for full forgiveness of the PPP loan through Bank of America. In May 2021, the SBA determined that the PPP Loan was fully approved for forgiveness and on May 23, 2021, the PPP Loan was repaid in full by the SBA to BofA. The forgiveness amount remitted was $1,956 in principal and $16 in interest and is included as a gain from the extinguishment of debt in the statement of operations. Aggregate maturities of bank debt related to the Loan Agreement are as follows: Fiscal Year ending: 2022 1,594 2023 2,125 2024 2,125 2025 34,728 2026 and beyond — Total $ 40,572 Unamortized debt issuance costs were $1,027 at January 1, 2022 and $1,275 at January 2, 2021, and are presented as a direct deduction of long-term debt on the consolidated balance sheets. Sale-Leaseback On March 24, 2009, Summer Infant (USA), Inc., (“Summer USA”) the Company’s wholly owned subsidiary, entered into a definitive agreement with Faith Realty II, LLC, a Rhode Island limited liability company (“Faith Realty”) (the owner of which is Jason Macari, the former Chief Executive Officer, former director of the Company, and current investor), pursuant to which Faith Realty purchased the corporate headquarters of the Company located at 1275 Park East Drive, Woonsocket, Rhode Island (the “Headquarters”), for $4,052 and subsequently leased the Headquarters back to Summer USA for an annual rent of $390 during the initial seven year term of the lease, payable monthly and in advance. The original lease was to expire on the seventh anniversary of its commencement. Mr. Macari had given a personal guarantee to secure the Faith Realty debt on its mortgage; therefore, due to his continuing involvement in the building transaction, the transaction had been recorded as a financing lease, with no gain recognition. On February 25, 2009, the Company’s Board of Directors (with Mr. Macari abstaining from such action) approved the sale leaseback transaction. In connection therewith, the Board of Directors granted a potential waiver, to the extent necessary, if at all, of the conflict of interest provisions of the Company’s Code of Ethics, effective upon execution of definitive agreements within the parameters approved by the Board. In connection with granting such potential waiver, the Board of Directors engaged independent counsel to review the sale leaseback transaction and an independent appraiser to ascertain (i) the value of the Headquarters and (ii) the market rent for the Headquarters. In reaching its conclusion that the sale leaseback transaction is fair to the Company, the Board of Directors considered a number of factors, including Summer USA’s ability to repurchase the headquarters at 110% of the initial sale price at the end of the initial term. The Company’s Audit Committee approved the sale leaseback transaction (as a related party transaction) and the potential waiver and recommended the matter to a vote of the entire Board of Directors (which approved the transaction). On May 13, 2015, Summer USA entered into an amendment (the “Amendment”) to its lease dated March 24, 2009 (the “Lease”) with Faith Realty (the “Landlord”). Pursuant to the Amendment, (i) the initial term of the Lease was extended for two On January 22, 2018, Summer USA entered into a second amendment (the “Second Amendment”) to the Lease. Pursuant to the Second Amendment, (i) the term of the Lease was extended to March 31, 2021, with no further rights of extension, (ii) the annual rent for the last three years of the newly amended term was set at $468, (iii) Summer USA no longer has the option to purchase the property subject to the Lease and (iv) the Landlord and Summer USA agreed to certain expenses, repairs and modifications to the property that is subject to the Lease. The Second Amendment was reviewed and approved by the audit committee because it was a related party transaction. On May 1, 2020, Summer USA entered into a third amendment (the “Third Amendment”) to the Lease. The agreement decreased the leased premises square footage and extended the current term, which was set to end in March 2021 prior to the amendment, to June 2025. It additionally granted two 5-year term extension options. Upon the execution of the lease amendment, the Company re-assessed the classification of the lease and determined it to be an operating lease, as the criteria for a sale-leaseback had not been met. This resulted in the de-recognition of the building of $2,357, net of depreciation and the addition of a right-of-use of $1,457 along with a short-term lease liability and a long-term lease liability for $264 and $1,193, respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jan. 01, 2022 | |
INCOME TAXES | |
INCOME TAXES | 6. INCOME TAXES In December 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”) that significantly revised the U.S. tax code effective January 1, 2018 by, among other things, lowering the corporate income tax rate from a top marginal rate of 35% to a flat 21%, limiting deductibility of interest expense and performance based incentive compensation and implementing a territorial tax system. As a result of the Tax Act in the fiscal years ending January 1, 2022 and January 2, 2021 the Company had non-deductible interest for tax purposes resulting in a deferred tax asset in the amount of $1,919 and $1,643, respectively. The Company recorded a valuation allowance on the value of this deferred tax asset until such time as it becomes more likely than not that this asset will be recognized. The provision for income taxes is summarized as follows: Fiscal 2021 Fiscal 2020 Current: Federal $ — $ 108 Foreign — 2 State and local 22 2 Total current 22 112 Deferred: Federal 718 $ (5) Foreign 237 6 State and local 200 4 Total deferred 1,155 5 Total provision $ 1,177 $ 117 The tax effects of temporary differences that comprise the deferred tax liabilities and assets are as follows: January 1, January 2, 2022 2021 Deferred tax assets: Accounts receivable $ 4 $ 51 Inventory and Uniform Capitalization reserve 467 475 Interest deduction limitation 1,919 1,643 Lease Liability and accrued expenses 3,912 806 Research and development credit 2,030 2,292 Foreign tax credit 795 795 Net operating loss carry-forward 2,735 2,565 Total deferred tax assets 11,862 8,627 Deferred tax liabilities: Intangible assets and other (2,271) (2,132) ROU Assets and deferred rent (3,745) (833) Property, plant and equipment (83) 28 Total deferred tax liabilities (6,099) (2,937) Valuation allowance (5,915) (4,689) Deferred tax liabilities and valuation allowance (12,014) (7,626) Net deferred income tax asset $ (152) $ 1,001 The following reconciles the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit in the consolidated financial statements: Fiscal 2021 Fiscal 2020 Tax benefit at statutory rate $ (361) $ (207) State income taxes, net of U.S. federal income tax benefit 176 5 Adjustment to uncertain tax position — 7,543 Stock options 16 5 Foreign tax rate differential (49) 2 Tax credits 262 258 Worthless stock deduction — (7,435) Non-deductible expenses/Non-taxable income including PPP (428) 149 Expiration of unexercised stock options 24 90 Increase/(Decrease) in valuation allowance 1,512 (255) Other 25 (38) Total provision $ 1,177 $ 117 The income tax provision for the year ended January 1, 2022 was primarily the result of an increase in valuation allowance on US and foreign net operating losses, offset by federal non-taxability of PPP loan forgiveness. The income tax provision for the year ended January 2, 2021 was primarily the result of a deduction related to a worthless stock loss in the Company’s investment in its wholly owned subsidiary, Born Free Holdings Limited (“BFH”), net of reserve for uncertain tax positions. The Company, after analyzing the facts and circumstances, determined to no longer invest in BFH and liquidated the entity. The Company has maintained a permanent investment position and, therefore, has not previously recorded a deferred tax asset for the basis difference in this entity. The original acquisition and financial results of this entity had created an excess of tax basis over the book basis in which the worthless stock was deducted for income tax purposes of approximately $26,933, resulting in an estimated net tax benefit of $7,435. The Company analyzed this transaction and determined that this worthless stock deduction qualifies as an ordinary loss. While the Company believes this is a valid income tax deduction, due to the uncertain nature of worthless stock deductions, the Company has determined this tax benefit to be an uncertain tax position. Accordingly, the Company fully reserved for the tax benefit associated with the worthless stock deduction. As of January 1, 2022, the Company had approximately $6,563 of US federal and state net operating loss carry forwards (or “NOLs”) to offset future federal taxable income. The federal NOL will begin to expire in 2031 and the state NOL began to expire in 2021. As of January 1, 2022, the Company had approximately $1,832, $543, and $2,028 of NOLs in Canada, Asia, and the United Kingdom, respectively, which can be carried forward indefinitely. Authoritative guidance requires a valuation allowance to reduce the deferred tax assets reported, if based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. After consideration of all evidence, including the Company’s past earnings history and future earnings forecast, management determined that a valuation allowance in the amount of $3,201 at January 1, 2022 and $2,251 at January 2, 2021 relating to certain federal and state tax credits and foreign NOLs was necessary. Due to the Tax Act, the Company determined a valuation allowance in the amount of $2,714 at January 1, 2022 and $2,438 at January 2, 2021 relating to interest deduction limitations and foreign tax credits was necessary. We apply the accounting guidance in ASC 740 related to accounting for uncertainty in income taxes. Our reserves related to taxes are based on a determination of whether, and how much of, a tax benefit taken by us in our tax filings or positions is more likely than not to be realized following resolution of any potential contingencies present related to the tax benefit. A summary of the Company’s adjustment to its uncertain tax positions in fiscal years ended January 1, 2022 and January 2, 2021 is set forth below: January 1, January 2, 2022 2021 Balance, at beginning of the year $ 7,543 $ — Increase for tax positions related to the current year — 7,543 Balance, at end of year $ 7,543 $ 7,543 The unrecognized tax benefits mentioned above included an aggregate of $0 of accrued interest and penalty balances related to uncertain tax positions. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. The Company does not anticipate that its accrual for uncertain tax positions will be reduced by a material amount over the next twelve-month period, as it does not expect to settle any potential disputed items with the appropriate taxing authorities, nor does it expect the statute of limitations to expire for any items. The Company is subject to U.S. federal income tax, as well as to income tax of multiple state and foreign tax jurisdictions. On a global basis, the open tax years subject to examination by major taxing jurisdictions in which the Company operates is between two |
SHARE BASED COMPENSATION
SHARE BASED COMPENSATION | 12 Months Ended |
Jan. 01, 2022 | |
SHARE BASED COMPENSATION | |
SHARE BASED COMPENSATION | 7. SHARE BASED COMPENSATION The Company is currently authorized to issue up to 374,889 shares for equity awards under the Company’s Amended and Restated 2012 Incentive Compensation Plan (“2012 Plan”). In May 2021, the Company’s stockholders approved an increase in the number of shares available for issuance under the 2012 Plan from 188,889 to 374,889. Periodically, the Company may also grant equity awards outside of its 2012 Plan as inducement grants for new hires. Under the 2012 Plan, awards may be granted to participants in the form of non-qualified stock options, incentive stock options, restricted stock, deferred stock, restricted stock units and other stock-based awards. Subject to the provisions of the plans, awards may be granted to employees, officers, directors, advisors and consultants who are deemed to have rendered or are able to render significant services to the Company or its subsidiaries and who are deemed to have contributed or to have the potential to contribute to the Company’s success. The Company accounts for options under the fair value recognition standard. The application of this standard resulted in share-based compensation expense for the twelve months ended January 1, 2022 and January 2, 2021 of $327 and $253, respectively. Share based compensation expense is included in selling, general and administrative expenses. As of January 1, 2022, there are 202,576 shares available to grant under the 2012 Plan. Stock Options The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the table below. The Company uses the simplified method to estimate the expected term of the options for grants of “plain vanilla” stock options as prescribed by the Securities and Exchange Commission. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Share-based compensation expense recognized in the consolidated financial statements in fiscal 2021 and 2020 is based on awards that are ultimately expected to vest. The following table summarizes the weighted average assumptions used for options granted during the fiscal years ended January 1, 2022 and January 2, 2021. Fiscal Fiscal 2021 2020 Expected life (in years) 4.6 4.7 Risk-free interest rate 0.7 % 0.3 % Volatility 105.3 % 98.9 % Dividend yield 0.0 % 0.0 % Forfeiture rate 50.6 % 51.9 % The weighted-average grant date fair value of options granted during the year ended January 1, 2022 was $9.95 per share. The weighted-average grant date fair value of options granted during the year ended January 2, 2021 was $2.61 per share. A summary of the status of the Company’s options as of January 1, 2022 and changes during the year then ended is presented below: Weighted- Number Average Of Exercise Shares Price Outstanding at beginning of year 60,639 $ 10.63 Granted 52,000 $ 13.41 Exercised or released (7,965) $ 8.03 Canceled or forfeited (33,705) $ 13.77 Expired (334) $ 66.96 Outstanding at end of year 70,635 $ 11.20 Options exercisable at January 1, 2022 13,425 $ 11.14 Outstanding stock options vested and expected to vest as of January 1, 2022 is 49,179. The intrinsic value of options exercised was $69 and $13 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. The following table summarizes information about stock options at January 1, 2022: Options Outstanding Options Exercisable Weighted Weighted Remaining Average Remaining Average Range of Number Contractual Exercise Number Contractual Exercise Exercise Prices Outstanding Life (years) Price Exercisable Life Price $3.51 - $6.00 13,056 7.4 $ 3.64 3,291 7.4 $ 3.64 $6.01 - $12.00 19,840 8.3 $ 9.26 5,895 6.7 $ 7.71 $12.01 - $20.00 36,396 8.9 $ 14.21 2,896 4.3 $ 17.11 $20.01 - $30.00 336 3.2 $ 23.76 336 3.2 $ 23.76 $30.01 - $48.51 1,007 1.1 $ 34.43 1,007 1.1 $ 34.43 70,635 8.3 $ 11.20 13,425 5.9 $ 11.14 The aggregate intrinsic value of options outstanding and exercisable 2022 Restricted Stock Awards Restricted stock awards require no payment from the grantee. The related compensation cost of each award is calculated using the market price on the grant date and is expensed equally over the vesting period. A summary of restricted stock awards made in the year ended January 1, 2022, is as follows: Number of Grant Date Shares Fair Value Non-vested restricted stock awards as of January 2, 2021 14,967 $ 8.68 Granted 20,960 $ 11.45 Vested and released (24,539) $ 11.13 Forfeited (5,316) $ 9.73 Non-vested restricted stock awards as of January 1, 2022 6,072 $ 7.44 As of January 1, 2022, there was approximately $21 of unrecognized compensation cost related to non-vested stock compensation arrangements granted under the Company’s stock incentive plan for restricted stock awards. That cost is expected to be recognized over the next 2.0 years. On March 13, 2020, the Company completed a 1-for-9 |
WEIGHTED AVERAGE COMMON SHARES
WEIGHTED AVERAGE COMMON SHARES | 12 Months Ended |
Jan. 01, 2022 | |
WEIGHTED AVERAGE COMMON SHARES | |
WEIGHTED AVERAGE COMMON SHARES | 8. WEIGHTED AVERAGE COMMON SHARES Basic and diluted earnings or loss per share (“EPS”) is based upon the weighted average number of common shares outstanding during the period. Diluted weighted average number of common shares outstanding also included common stock equivalents such as stock options and restricted shares. The Company does not include the anti-dilutive effect of common stock equivalents in the calculation of dilutive common shares outstanding. A reconciliation of basic and diluted net income attributable to common stockholders is as follows: For the Twelve For the Twelve Months Ended Months Ended Calculation of Basic and Diluted EPS January 1, 2022 January 2, 2021 Weighted-average common shares outstanding – basic 2,152,926 2,119,499 Dilutive effect of restricted shares — — Dilutive effect of stock options — — Weighted-average common shares outstanding – diluted 2,152,926 2,119,499 Earnings per share – basic $ (1.35) $ (0.52) Earnings per share – diluted $ (1.35) $ (0.52) The computation of diluted common shares for the twelve months January 1, 2022 excluded 70,635 and stock options and 6,072 shares of restricted stock outstanding, respectively because to include them would have been anti-dilutive. The computation of diluted common shares for the twelve months ended January 2, 2021 excluded 60,639 of stock options outstanding and excluded 14,967 shares of restricted stock outstanding, respectively because to include them would have been anti-dilutive. |
PROFIT SHARING PLAN
PROFIT SHARING PLAN | 12 Months Ended |
Jan. 01, 2022 | |
PROFIT SHARING PLAN | |
PROFIT SHARING PLAN | 9. PROFIT SHARING PLAN Summer Infant (USA), Inc. maintains a defined contribution salary deferral plan under Section 401(k) of the Internal Revenue Code. All employees who meet the plan’s eligibility requirements can participate. Employees may elect to make contributions up to federal limitations. In 2007, the Company adopted a matching plan which was further amended in 2013, and which was funded throughout the year. For the years ended January 1, 2022 and January 2, 2021, the Company recorded 401(k) matching expense of $235 and $278, respectively. |
MAJOR CUSTOMERS
MAJOR CUSTOMERS | 12 Months Ended |
Jan. 01, 2022 | |
MAJOR CUSTOMERS | |
MAJOR CUSTOMERS | 10. MAJOR CUSTOMERS Sales to the Company’s top seven customers together comprised approximately 88% of our sales in fiscal 2021 and 87% of our sales in fiscal 2021. Of these customers, three generated more than 10% of sales for fiscal 2021: Amazon.com (38%), Walmart (24%), and Target (18%). In fiscal 2020, three customers generated more than 10% of sales: Amazon.com (33%), Walmart (28%), and Target (17%). |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jan. 01, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 11. COMMITMENTS AND CONTINGENCIES Leases The Company leases office space and distribution centers primarily related to its United States, Canada, United Kingdom, and Hong Kong operations. In connection with these leases, there were no cash incentives from the landlord to be used for the construction of leasehold improvements within the facility. In May 2020, the Company entered into a lease agreement amendment related to our headquarters in Woonsocket, Rhode Island. The agreement decreased the leased premises square footage and extended the current term, which was set to end in March 2021 prior to the amendment to June 2025. It additionally granted two 5-year term extension options. The Company was accounting for the lease in Woonsocket as a sale-leaseback with the building on the balance sheet as property and equipment, net and a corresponding financing obligation in long-term liabilities. Upon the execution of the lease amendment, the Company re-assessed the classification of the lease and determined it to be an operating lease, as the criteria for a sale had been met. As part of this re-classification, the Company derecognized the financing obligation of $2,390 from long-term liabilities and the amount related to the property and equipment, net of $2,357 from the balance sheet and recorded a ROU asset In April 2020, the Company entered into a twelve-month sublease agreement for a portion of its main leased warehouse and distribution center located in Riverside, California. In February 2021, Summer USA extended its lease at its Riverside, California distribution center. The existing lease was set to expire on September 30, 2021 and has been extended for 61 months through October 31, 2026. In addition, the amended lease grants a 60-month extension option. The Company concluded that this is a modification to the existing lease and continues to be classified as operating. Upon the execution of the lease extension, the Company recorded an increase in ROU In October 2021, the Company renewed its lease in Hong Kong for an additional two years beginning in November 2021 and terminating in November 2023. No options to renew were stipulated in the lease. Upon execution of the lease, the Company recorded an ROU asset The Company identified and assessed the following significant assumptions in recognizing the right-of-use asset and corresponding liabilities: ● Expected lease term— The expected lease term includes both contractual lease periods and, when applicable, cancelable option periods when it is reasonably certain that the Company would exercise such options. These leases have remaining lease terms between 0.17 and 4.83 years. The Woonsocket lease has two 5-year extension options, and the Canada lease has one 5-year extension option that have not been included in the lease term. ● Incremental borrowing rate —The Company’s lease agreements do not provide an implicit rate. As the Company does not have any external borrowings for comparable terms of its leases, the Company estimated the incremental borrowing rate based on secured borrowings available to the Company for the next 5 years . This is the rate the Company would have to pay if borrowing on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. ● Lease and non - lease components— In certain cases the Company is required to pay for certain additional charges for operating costs, including insurance, maintenance, taxes, and other costs incurred, which are billed based on both usage and as a percentage of the Company’s share of total square footage. The Company determined that these costs are non-lease components, and they are not included in the calculation of the lease liabilities because they are variable. Payments for these variable, non-lease components are considered variable lease costs and are recognized in the period in which the costs are incurred. The components of the Company’s lease expense for the years ended January 1, 2022 and January 2, 2021 were as follows: Year Ended Year Ended January 1, 2022 January 2, 2021 Operating lease cost $ 3,553 $ 2,710 Variable lease cost 909 1,057 Less: sublease income (1,199) (749) Total lease expense $ 3,263 $ 3,018 Weighted-average remaining lease term 4.6 years 1.2 years Weighted-average discount rate: 3.35 % 5.00 % Cash paid for amounts included in the measurement of the Company’s lease liabilities were $2,969 and $2,911 for the years ended January 1, 2022 and January 2, 2021, respectively. As of January 1, 2022, the present value of maturities of the Company’s operating lease liabilities were as follows: Fiscal Year Ending: 2022 $ 3,592 2023 3,498 2024 3,347 2025 3,284 2026 2,672 Less imputed interest (1,226) Total $ 15,167 The future fixed sublease receipts under non-cancelable operating lease agreements as of January 1, 2022 are as follows: Fiscal Year Ending: 2022 $ 1,348 Thereafter — Total $ 1,348 Employment Contracts In accordance with applicable local law, Summer Infant Europe Limited is required to have employment contracts with all of its employees. In connection with these contracts, Summer Infant Europe Limited makes individual pension contributions to certain employees at varying rates from 1-7% of the employee’s annual salary, as part of their total compensation package. These pension contributions are expensed as incurred. There are no termination benefit provisions in these contracts. Litigation The Company is a party to routine litigation and administrative complaints incidental to its business. The Company does not believe that the resolution of any or all of such current routine litigation and administrative complaints is likely to have a material adverse effect on the Company’s financial condition or results of operations. |
GEOGRAPHICAL INFORMATION
GEOGRAPHICAL INFORMATION | 12 Months Ended |
Jan. 01, 2022 | |
GEOGRAPHICAL INFORMATION | |
GEOGRAPHICAL INFORMATION | 12. GEOGRAPHICAL INFORMATION The Company sells products throughout the United States, Canada, and the United Kingdom, and various other parts of the world. The Company does not disclose product line revenues as it is not practicable for the Company to do so. The following is a table that presents net revenue by geographic area: For the fiscal year ended January 1, January 2, 2022 2021 United States $ 132,153 $ 140,173 All Other 11,512 15,126 $ 143,665 $ 155,299 The following is a table that presents total assets by geographic area: January 1, January 2, 2022 2021 United States $ 88,836 $ 70,689 All Other 2,394 4,048 $ 91,230 $ 74,737 The following is a table that presents total long-lived assets by geographic area: January 1, January 2, 2022 2021 United States $ 29,224 $ 19,983 All Other 773 1,276 $ 29,997 $ 21,259 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jan. 01, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 13. SUBSEQUENT EVENTS The Company has evaluated all events or transactions that occurred after January 1, 2022 through the date of this Annual Report on Form 10-K and determined that no subsequent events occurred that would require recognition in the consolidated financial statements or disclosure in the notes thereto except as follows: Loan and Security Agreement. The New Term Loan Agreement provides for a second lien, subordinated term loan in an amount up to $5,000, with requests for the funding of tranches limited to every 30 days (the “New Term Loan”), subject to certain limitations. Borrowings under the New Term Loan Agreement will bear interest at a rate of 5.0% per annum until January 27, 2024, and thereafter at a rate of 9.0% per annum, payable in arrears on a quarterly basis. The principal amount of any borrowing will be repaid quarterly in installments equal to 2.5% of the highest amount of borrowings outstanding under the New Term Loan Agreement during the applicable quarter, commencing on July 1, 2022 and continuing until the maturity date of April 19, 2026. Borrowings under the New Loan Term Agreement are secured by a second lien on substantially all of the assets of the Company and are subordinated to the Company’s obligations under the BofA Agreement. The New Term Loan Agreement as amended contains customary affirmative and negative covenants and events of default substantially the same as the BofA Agreement. Amendments to BofA Agreement. Proposed Merger with Kids2, Inc. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jan. 01, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Revenue Recognition | Revenue Recognition The Company applies FASB ASC Topic 606, Revenue from Contracts with Customers The Company’s principal activities from which it generates its revenue is product sales. The Company has one reportable segment of business. Revenue is measured based on consideration specified in a contract with a customer. The Company recognizes revenue when it satisfies a performance obligation in a contract by transferring control over a product to a customer when product delivery occurs. Consideration is typically paid approximately 60 days from the time control is transferred. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in selling costs. A performance obligation is a promise in a contract to transfer a distinct product to the customer, which for the Company is transfer of primarily juvenile products to its customers. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. A transaction price is the amount of consideration the Company expects to receive under the arrangement. The Company is required to estimate variable consideration (if any) and to factor that estimation into the determination of the transaction price. The Company conducts its business with customers through valid purchase or sales orders each of which is considered a separate contract because individual orders are not interdependent on one another. Product transaction prices on a purchase or sale order are discrete and stand-alone. Purchase or sales orders may be issued under either a customer master service agreement or a reseller allowance agreement. Purchase or sales orders, master service agreements, and reseller allowance agreements which are specific and unique to each customer, may include product price discounts, markdown allowances, return allowances, and/or volume rebates which reduce the consideration due from customers. Variable consideration is estimated using the most likely amount method, which is based on our historical experience as well as current information such as sales forecasts. Contracts may also include cooperative advertising arrangements where the Company allows a discount from invoiced product amounts in exchange for customer purchased advertising that features the Company’s products. These allowances are generally based upon product purchases or specific advertising campaigns. Such allowances are accrued when the related revenue is recognized. These cooperative advertising arrangements provide a distinct benefit and fair value and are accounted for as direct selling expenses. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Accordingly, actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash flows, cash and cash equivalents include money market accounts and investments with an original maturity of three months or less. At times, the Company possesses cash balances in excess of federally-insured limits. |
Trade Receivables | Trade Receivables Trade receivables are carried at their outstanding unpaid principal balances reduced by an allowance for doubtful accounts. The Company estimates doubtful accounts based on historical bad debts, factors related to specific customers’ ability to pay and current economic trends. The Company writes off accounts receivable against the allowance when a balance is determined to be uncollectible. Amounts are considered to be uncollectable based upon historical experience and management’s evaluation of outstanding accounts receivable. Changes in the allowance for doubtful accounts are as follows: For the fiscal year ended January 1, January 2, 2022 2021 Allowance for doubtful accounts, beginning of period $ 197 $ 542 Charges to (recovery of) costs and expenses 8 (27) Account write-offs and other (191) (318) Allowance for doubtful accounts, end of period $ 14 $ 197 |
Inventory Valuation | Inventory Valuation Inventory is comprised mostly of finished goods and some component parts and is stated at the lower of cost using the first-in, first-out (FIFO) method, or net realizable value. The Company regularly reviews slow-moving and excess inventories and writes down inventories to net realizable value if the ultimate expected net proceeds from the disposals of excess inventory are less than the carrying cost of the merchandise. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and lease liabilities in the Company’s consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company’s uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The components of a lease should be split into three categories: lease components (e.g., land, building, etc.), non-lease components (e.g., common area maintenance, maintenance, consumables, etc.), and non-components (e.g., property taxes, insurance, etc.). Then the fixed and in-substance fixed contract consideration (including any related to non-components) must be allocated based on fair values to the lease components and non-lease components. Although separation of lease and non-lease components is required, certain practical expedients are available to entities. Entities electing the practical expedient would not separate lease and non-lease components. Rather, they would account for each lease component and the related non-lease component together as a single component. The Company’s facilities operating leases have lease and non-lease components to which the Company has elected to apply the practical expedient and account for each lease component and related non-lease component as one single component. The lease component results in a ROU asset being recorded on the balance sheet. Lease expense for lease payments is recognized on a straight-line basis over the lease term. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. The Company owns the tools and molds used in the production of its products by third party manufacturers. Capitalized mold costs include costs incurred for the pre-production design and development of the molds. Depreciation is provided over the estimated useful lives of the respective assets using the straight-line method. |
Long-Lived Assets with Finite Lives | Long-Lived Assets with Finite Lives The Company reviews long-lived assets with finite lives for impairment on an asset group level whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. An asset is considered to be impaired when its carrying amount exceeds both the sum of the undiscounted future net cash flows expected to result from the use of the asset and its eventual disposition and the assets’ fair value. Long-lived assets include property and equipment and finite-lived intangible assets. The amount of impairment loss, if any, is charged by the Company to current operations. |
Indefinite-Lived Intangible Assets | Indefinite-Lived Intangible Assets The Company accounts for intangible assets in accordance with accounting guidance that requires that intangible assets with indefinite useful lives be tested annually for impairment and more frequently if events or changes in circumstances indicate that the asset might be impaired. The Company’s annual impairment testing is conducted in the fourth quarter of every year. The Company tests indefinite-lived intangible assets for impairment by comparing the asset’s fair value to its carrying amount. If the fair value is less than the carrying amount, the excess of the carrying amount over fair value is recognized as an impairment charge and the adjusted carrying amount becomes the assets’ new cost basis. Management also evaluates the remaining useful life of an intangible asset that is not being amortized each reporting period to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is subsequently determined to have a finite useful life, it is amortized prospectively over its estimated remaining useful life. |
Fair Value Measurements | Fair Value Measurements The Company follows ASC 820, “Fair Value Measurements and Disclosures” which includes a framework for measuring fair value and expanded related disclosures. Broadly, the framework requires fair value to be determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The standard established a three-level valuation hierarchy based upon observable and non-observable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy: Level 1—Quoted prices for identical instruments in active markets. Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3—Significant inputs to the valuation model are unobservable. The Company maintains policies and procedures to value instruments using the best and most relevant data available. In addition, the Company utilizes third party specialists that review valuation, including independent price validation. The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and short and long-term borrowings. Because of their short maturity, the carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value. The carrying value of the Company’s debt approximates fair value since the stated rate is similar to rates currently available to the Company for debt with similar terms and remaining maturities. The Company’s assets measured at fair value on a nonrecurring basis include long-lived assets and finite-lived intangibles. The Company tests its indefinite-lived assets for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value may not be recoverable or that the carrying value may exceed its fair value. The resulting fair value measurements are considered to be Level 3 inputs. The Company did not record an impairment charge in fiscal 2021. During the fourth quarter of fiscal 2020, the Company determined that the estimated fair value of a definite-lived asset was non-recoverable, and the Company recorded a non-cash impairment charge of $676 which reduced the value of the intangible asset to $0, as more fully described in “Note 4 to the Consolidated Financial Statements-Intangible Assets.” |
Income Taxes | Income taxes Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence, it is more likely than not that such benefits will be realized. Deferred income tax assets are recorded on a net basis as a long term asset. The Company follows the applicable guidance relative to uncertain tax positions. This standard provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Uncertain tax positions must meet a recognition threshold of more-likely-than-not in order for those tax positions to be recognized in the financial statements. |
Translation of Foreign Currencies | Translation of Foreign Currencies Assets and liabilities of the Company’s foreign subsidiaries whose functional currency is its local currency, are translated into U.S. dollars at the exchange rate in effect at the end of the quarter and the income and expense accounts of these affiliates have been translated at average rates prevailing during each respective quarter. Resulting translation adjustments are made to a separate component of stockholders’ equity within accumulated other comprehensive loss. Assets and liabilities of the Company’s foreign subsidiaries whose functional currency is the U.S. dollar are remeasured into U.S. dollars at their historical rates or the exchange rate in effect at the end of the quarter and the income and expense accounts of these affiliates have been remeasured at average rates prevailing during each respective quarter. Resulting remeasurement adjustments are made to the consolidated statement of operations. Foreign exchange transaction gains and losses are included in the accompanying consolidated statement of operations. |
Shipping Costs | Shipping Costs Shipping costs to customers are included in selling expenses and amounted to approximately $2,206 and $2,485 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. |
Advertising Costs | Advertising Costs The Company charges advertising costs to selling expense as incurred. Advertising expense, which consists primarily of promotional and cooperative advertising allowances provided to customers, was approximately $7,881 and $9,215 for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate, discrete financial information is available for evaluation by the chief operating decision-maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company views its operations and manages its business as one operating segment utilizing an omni-channel distribution strategy. |
Net Loss Per Share | Net Loss Per Share Basic loss per share for the Company is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted income or loss per share includes the dilutive impact of outstanding stock options and unvested restricted shares. Diluted loss per share for the Company is computed by dividing net loss by the dilutive weighted average shares outstanding which includes: the dilutive impact (using the “treasury stock” method) of “in the money” stock options and unvested restricted shares issued to employees. Options to purchase 70,635 and 60,639 shares of the Company’s common stock and 6,072 and 14,967 of restricted shares were not included in the calculation, due to the fact that these instruments were anti-dilutive for the fiscal years ended January 1, 2022 and January 2, 2021, respectively. |
New Accounting Pronouncements | New Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and a subsequent amendment to the initial guidance, ASU 2018-19 Codification Improvements to Topic 325, Financial Instruments-Credit Losses (collectively, Topic 326). Topic 326 requires measurement and recognition of expected credit losses for financial assets held, which include, but are not limited to, trade and other receivables. The new standard is effective for fiscal years beginning after December 15, 2022. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Summary of changes in the allowance for doubtful accounts | For the fiscal year ended January 1, January 2, 2022 2021 Allowance for doubtful accounts, beginning of period $ 197 $ 542 Charges to (recovery of) costs and expenses 8 (27) Account write-offs and other (191) (318) Allowance for doubtful accounts, end of period $ 14 $ 197 |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
REVENUE | |
Schedule of net sales by geographical area | For the fiscal year ended January 1, January 2, 2022 2021 United States $ 132,153 $ 140,173 All Other 11,512 15,126 $ 143,665 $ 155,299 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
PROPERTY AND EQUIPMENT | |
Schedule of property and equipment, at cost | For the fiscal year ended January 1, January 2, Depreciation/ 2022 2021 Amortization Period Computer-related $ 4,577 $ 4,560 5 years Tools, dies, prototypes, and molds 28,826 27,849 1 - 5 years Other 7,777 7,671 1 - 15 years 41,180 40,080 Less: accumulated depreciation 37,052 35,291 Property and equipment, net $ 4,128 $ 4,789 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
INTANGIBLE ASSETS | |
Schedule of intangible assets | For the fiscal year ended January 1, January 2, 2022 2021 Brand names $ 10,900 $ 10,900 Patents and licenses 4,208 4,125 Customer relationships 6,946 6,946 Other intangibles 1,886 1,882 23,940 23,853 Less: accumulated amortization (12,558) (12,114) Intangible assets, net $ 11,382 $ 11,739 |
Estimated amortization expense for the remaining definite-lived assets for the next five years | Estimated amortization expense for the remaining definite-lived assets for the next five years is as follows: Fiscal Year ending 2022 440 2023 440 2024 440 2025 437 2026 207 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
DEBT | |
Schedule of aggregate maturities of the Loan Agreement and the PPP Loan | Aggregate maturities of bank debt related to the Loan Agreement are as follows: Fiscal Year ending: 2022 1,594 2023 2,125 2024 2,125 2025 34,728 2026 and beyond — Total $ 40,572 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
INCOME TAXES | |
Schedule of provision (benefit) for income taxes | Fiscal 2021 Fiscal 2020 Current: Federal $ — $ 108 Foreign — 2 State and local 22 2 Total current 22 112 Deferred: Federal 718 $ (5) Foreign 237 6 State and local 200 4 Total deferred 1,155 5 Total provision $ 1,177 $ 117 |
Schedule of tax effects of temporary differences that comprise the deferred tax liabilities and assets | January 1, January 2, 2022 2021 Deferred tax assets: Accounts receivable $ 4 $ 51 Inventory and Uniform Capitalization reserve 467 475 Interest deduction limitation 1,919 1,643 Lease Liability and accrued expenses 3,912 806 Research and development credit 2,030 2,292 Foreign tax credit 795 795 Net operating loss carry-forward 2,735 2,565 Total deferred tax assets 11,862 8,627 Deferred tax liabilities: Intangible assets and other (2,271) (2,132) ROU Assets and deferred rent (3,745) (833) Property, plant and equipment (83) 28 Total deferred tax liabilities (6,099) (2,937) Valuation allowance (5,915) (4,689) Deferred tax liabilities and valuation allowance (12,014) (7,626) Net deferred income tax asset $ (152) $ 1,001 |
Schedule of reconciliation of the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit in the consolidated financial statements | Fiscal 2021 Fiscal 2020 Tax benefit at statutory rate $ (361) $ (207) State income taxes, net of U.S. federal income tax benefit 176 5 Adjustment to uncertain tax position — 7,543 Stock options 16 5 Foreign tax rate differential (49) 2 Tax credits 262 258 Worthless stock deduction — (7,435) Non-deductible expenses/Non-taxable income including PPP (428) 149 Expiration of unexercised stock options 24 90 Increase/(Decrease) in valuation allowance 1,512 (255) Other 25 (38) Total provision $ 1,177 $ 117 |
Schedule of the Company's adjustment to its uncertain tax positions | January 1, January 2, 2022 2021 Balance, at beginning of the year $ 7,543 $ — Increase for tax positions related to the current year — 7,543 Balance, at end of year $ 7,543 $ 7,543 |
SHARE BASED COMPENSATION (Table
SHARE BASED COMPENSATION (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
SHARE BASED COMPENSATION | |
Summary of weighted average assumptions used for stock options granted | Fiscal Fiscal 2021 2020 Expected life (in years) 4.6 4.7 Risk-free interest rate 0.7 % 0.3 % Volatility 105.3 % 98.9 % Dividend yield 0.0 % 0.0 % Forfeiture rate 50.6 % 51.9 % |
Summary of status of the Company's options and changes during the period | Weighted- Number Average Of Exercise Shares Price Outstanding at beginning of year 60,639 $ 10.63 Granted 52,000 $ 13.41 Exercised or released (7,965) $ 8.03 Canceled or forfeited (33,705) $ 13.77 Expired (334) $ 66.96 Outstanding at end of year 70,635 $ 11.20 Options exercisable at January 1, 2022 13,425 $ 11.14 |
Summary of stock options, by range of exercise prices | The following table summarizes information about stock options at January 1, 2022: Options Outstanding Options Exercisable Weighted Weighted Remaining Average Remaining Average Range of Number Contractual Exercise Number Contractual Exercise Exercise Prices Outstanding Life (years) Price Exercisable Life Price $3.51 - $6.00 13,056 7.4 $ 3.64 3,291 7.4 $ 3.64 $6.01 - $12.00 19,840 8.3 $ 9.26 5,895 6.7 $ 7.71 $12.01 - $20.00 36,396 8.9 $ 14.21 2,896 4.3 $ 17.11 $20.01 - $30.00 336 3.2 $ 23.76 336 3.2 $ 23.76 $30.01 - $48.51 1,007 1.1 $ 34.43 1,007 1.1 $ 34.43 70,635 8.3 $ 11.20 13,425 5.9 $ 11.14 |
Schedule of non-vested activity - Restricted Stock Awards | Number of Grant Date Shares Fair Value Non-vested restricted stock awards as of January 2, 2021 14,967 $ 8.68 Granted 20,960 $ 11.45 Vested and released (24,539) $ 11.13 Forfeited (5,316) $ 9.73 Non-vested restricted stock awards as of January 1, 2022 6,072 $ 7.44 |
WEIGHTED AVERAGE COMMON SHARES
WEIGHTED AVERAGE COMMON SHARES (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
WEIGHTED AVERAGE COMMON SHARES | |
Schedule of reconciliation of basic and diluted net income attributable to common stockholders | For the Twelve For the Twelve Months Ended Months Ended Calculation of Basic and Diluted EPS January 1, 2022 January 2, 2021 Weighted-average common shares outstanding – basic 2,152,926 2,119,499 Dilutive effect of restricted shares — — Dilutive effect of stock options — — Weighted-average common shares outstanding – diluted 2,152,926 2,119,499 Earnings per share – basic $ (1.35) $ (0.52) Earnings per share – diluted $ (1.35) $ (0.52) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of lease expense | The components of the Company’s lease expense for the years ended January 1, 2022 and January 2, 2021 were as follows: Year Ended Year Ended January 1, 2022 January 2, 2021 Operating lease cost $ 3,553 $ 2,710 Variable lease cost 909 1,057 Less: sublease income (1,199) (749) Total lease expense $ 3,263 $ 3,018 Weighted-average remaining lease term 4.6 years 1.2 years Weighted-average discount rate: 3.35 % 5.00 % |
Schedule of present value of maturities of operating lease liabilities | As of January 1, 2022, the present value of maturities of the Company’s operating lease liabilities were as follows: Fiscal Year Ending: 2022 $ 3,592 2023 3,498 2024 3,347 2025 3,284 2026 2,672 Less imputed interest (1,226) Total $ 15,167 |
Schedule of future fixed sublease receipts under non-cancelable operating lease agreements | The future fixed sublease receipts under non-cancelable operating lease agreements as of January 1, 2022 are as follows: Fiscal Year Ending: 2022 $ 1,348 Thereafter — Total $ 1,348 |
GEOGRAPHICAL INFORMATION (Table
GEOGRAPHICAL INFORMATION (Tables) | 12 Months Ended |
Jan. 01, 2022 | |
GEOGRAPHICAL INFORMATION | |
Schedule of net revenue by geographic area | The following is a table that presents net revenue by geographic area: For the fiscal year ended January 1, January 2, 2022 2021 United States $ 132,153 $ 140,173 All Other 11,512 15,126 $ 143,665 $ 155,299 |
Schedule of total assets by geographic area | The following is a table that presents total assets by geographic area: January 1, January 2, 2022 2021 United States $ 88,836 $ 70,689 All Other 2,394 4,048 $ 91,230 $ 74,737 |
Schedule of total long lived assets by geographic area | The following is a table that presents total long-lived assets by geographic area: January 1, January 2, 2022 2021 United States $ 29,224 $ 19,983 All Other 773 1,276 $ 29,997 $ 21,259 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands | Mar. 13, 2020 | Jan. 02, 2021USD ($) | Jan. 01, 2022USD ($)segmentshares | Jan. 02, 2021USD ($)shares |
2022 Plan and COVID-19 Pandemic | ||||
Cash | $ 510 | $ 535 | $ 510 | |
Net loss | (2,898) | (1,102) | ||
Cash in operating activities | (8,391) | 17,607 | ||
Outstanding indebtedness | 40,572 | |||
Borrowing availability | 2,949 | |||
Reverse Stock Split | ||||
Reverse stock split | 0.1111 | |||
Reclassification | ||||
Amortization of deferred financing costs | $ 294 | $ 651 | ||
Fiscal Year | ||||
Fiscal Period Duration | 364 days | 371 days | ||
Revenue Recognition | ||||
Number of reportable segments | segment | 1 | |||
Days in accounts receivable | P60D | |||
Changes in the allowance for doubtful accounts | ||||
Allowance for doubtful accounts, beginning of period | $ 197 | $ 542 | ||
Charges to (recovery of) costs and expenses | 8 | (27) | ||
Account write-offs and other | (191) | (318) | ||
Allowance for doubtful accounts, end of period | 197 | $ 14 | 197 | |
Fair Value Measurements | ||||
Amortization of definite-lived intangible assets | 676 | 676 | ||
Adjusted value of definite-lived intangible asset | 0 | 0 | ||
Segment Information | ||||
Number of operating segments | segment | 1 | |||
New Accounting Pronouncements | ||||
ROU asset | $ 3,625 | $ 14,383 | $ 3,625 | |
Operating Lease, Liability | $ 15,167 | |||
Stock Options | ||||
Net Income/Loss Per Share | ||||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | shares | 70,635 | 60,639 | ||
Restricted shares | ||||
Net Income/Loss Per Share | ||||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | shares | 6,072 | 14,967 | ||
Selling expenses | ||||
Shipping costs and Advertising costs | ||||
Shipping costs | $ 2,206 | $ 2,485 | ||
Advertising costs | $ 7,881 | $ 9,215 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Net sales by geographical area | ||
Net sales | $ 143,665 | $ 155,299 |
Election of practical expedient, incremental cost of obtaining contracts | true | true |
United States | ||
Net sales by geographical area | ||
Net sales | $ 132,153 | $ 140,173 |
All Other | ||
Net sales by geographical area | ||
Net sales | $ 11,512 | $ 15,126 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) $ in Thousands | 12 Months Ended | |||
Jan. 01, 2022USD ($)item | Jan. 02, 2021USD ($) | May 31, 2020USD ($) | May 01, 2020USD ($) | |
PROPERTY AND EQUIPMENT | ||||
Property and equipment, gross | $ 41,180 | $ 40,080 | ||
Less: accumulated depreciation | 37,052 | 35,291 | ||
Property and equipment, net | 4,128 | 4,789 | ||
Total depreciation expense | 1,795 | 2,847 | ||
ROU asset | $ 14,383 | 3,625 | ||
Woonsocket, RI | ||||
PROPERTY AND EQUIPMENT | ||||
Number of options to extend | item | 2 | |||
Extension term | 5 years | |||
ROU asset | $ 1,457 | |||
Adjustments resulting from lease amendment agreement | ||||
PROPERTY AND EQUIPMENT | ||||
Property and equipment, net | (2,357) | $ (2,357) | ||
ROU asset | $ 1,457 | $ 1,457 | ||
Computer-related | ||||
PROPERTY AND EQUIPMENT | ||||
Property and equipment, gross | $ 4,577 | $ 4,560 | ||
Depreciation/Amortization Period | 5 years | 5 years | ||
Tools, dies, prototypes, and molds | ||||
PROPERTY AND EQUIPMENT | ||||
Property and equipment, gross | $ 28,826 | $ 27,849 | ||
Tools, dies, prototypes, and molds | Minimum | ||||
PROPERTY AND EQUIPMENT | ||||
Depreciation/Amortization Period | 1 year | 1 year | ||
Tools, dies, prototypes, and molds | Maximum | ||||
PROPERTY AND EQUIPMENT | ||||
Depreciation/Amortization Period | 5 years | 5 years | ||
Other | ||||
PROPERTY AND EQUIPMENT | ||||
Property and equipment, gross | $ 7,777 | $ 7,671 | ||
Other | Minimum | ||||
PROPERTY AND EQUIPMENT | ||||
Depreciation/Amortization Period | 1 year | 1 year | ||
Other | Maximum | ||||
PROPERTY AND EQUIPMENT | ||||
Depreciation/Amortization Period | 15 years | 15 years |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jan. 02, 2021 | Jan. 01, 2022 | Jan. 02, 2021 | |
INTANGIBLE ASSETS | |||
Intangible assets, gross | $ 23,853 | $ 23,940 | $ 23,853 |
Less: Accumulated amortization | (12,114) | (12,558) | (12,114) |
Intangible assets, net | 11,739 | 11,382 | 11,739 |
Amortization expense | 444 | 501 | |
Amortization of definite-lived intangible assets | 676 | 676 | |
Intangibles not subject to amortization | 8,400 | 8,400 | 8,400 |
Impairment of intangible asset | 0 | $ 0 | |
Estimated future amortization expense | |||
2022 | 440 | ||
2023 | 440 | ||
2024 | 440 | ||
2025 | 437 | ||
2026 | $ 207 | ||
Minimum | |||
INTANGIBLE ASSETS | |||
Amortization period of intangible assets | 5 years | 5 years | |
Maximum | |||
INTANGIBLE ASSETS | |||
Amortization period of intangible assets | 18 years | 18 years | |
Patents and licenses | |||
INTANGIBLE ASSETS | |||
Intangible assets, gross | 4,125 | $ 4,208 | $ 4,125 |
Customer relationships | |||
INTANGIBLE ASSETS | |||
Intangible assets, gross | 6,946 | 6,946 | 6,946 |
Other intangibles | |||
INTANGIBLE ASSETS | |||
Intangible assets, gross | 1,882 | 1,886 | 1,882 |
Brand names | |||
INTANGIBLE ASSETS | |||
Intangible assets, gross | $ 10,900 | $ 10,900 | $ 10,900 |
DEBT - Loan Agreement with Bank
DEBT - Loan Agreement with Bank of America (Details) $ in Thousands | Jun. 28, 2018USD ($) | Jan. 01, 2022USD ($) | Jan. 02, 2021USD ($) | Mar. 16, 2022USD ($) | Jan. 28, 2022USD ($) | Oct. 15, 2020USD ($) |
DEBT | ||||||
Borrowing availability | $ 2,949 | |||||
Prior Bank of America Credit Facility | Revolving credit facility | Financial Covenant | ||||||
DEBT | ||||||
Borrowing base as a percentage of eligible receivables | 85.00% | |||||
Borrowing base as a percentage of eligible inventory | 70.00% | |||||
Borrowing base as a percentage of net orderly liquidation value of eligible inventory and less reserves | 85.00% | |||||
Prior Bank of America Credit Facility | Letter of credit sub-line facility | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 5,000 | |||||
BofA Agreement | Minimum | Financial Covenant | ||||||
DEBT | ||||||
Fixed charge coverage ratio at the end of each fiscal month | 1 | |||||
BofA Agreement | Term Loan | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 7,500 | |||||
Amount outstanding | $ 5,625 | $ 7,125 | ||||
Quarterly basis installment amount | 375 | |||||
BofA Agreement | Term Loan | Financial Covenant | ||||||
DEBT | ||||||
Threshold availability to maintain minimum fixed charge coverage ratio | $ 5,000 | |||||
BofA Agreement | Term Loan | LIBOR | ||||||
DEBT | ||||||
Interest rate during the period | 3.875% | |||||
BofA Agreement | Term Loan | Base rate | ||||||
DEBT | ||||||
Interest rate during the period | 5.75% | |||||
BofA Agreement | FILO Loan | ||||||
DEBT | ||||||
Maximum borrowing capacity | 2,500 | |||||
Amount outstanding | $ 1,719 | 2,344 | ||||
BofA Agreement | FILO Loan | LIBOR | ||||||
DEBT | ||||||
Interest rate during the period | 3.625% | |||||
BofA Agreement | FILO Loan | Base rate | ||||||
DEBT | ||||||
Interest rate during the period | 5.50% | |||||
BofA Agreement | Revolving credit facility | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 40,000 | |||||
Amount outstanding | $ 33,228 | $ 21,467 | ||||
Borrowing capacity | 36,177 | |||||
Borrowing availability | $ 2,949 | |||||
BofA Agreement | Revolving credit facility | Financial Covenant | ||||||
DEBT | ||||||
Borrowing base as a percentage of eligible receivables | 85.00% | |||||
Borrowing base as a percentage of eligible inventory | 70.00% | |||||
Borrowing base as a percentage of net orderly liquidation value of eligible inventory and less reserves | 85.00% | |||||
BofA Agreement | Revolving credit facility | LIBOR | ||||||
DEBT | ||||||
Interest rate during the period | 2.625% | 2.625% | ||||
BofA Agreement | Revolving credit facility | Base rate | ||||||
DEBT | ||||||
Interest rate during the period | 4.50% | |||||
BofA Agreement | Letter of credit sub-line facility | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 5,000 | |||||
Term Loan and Security Agreement | New Term Loan Agreement | ||||||
DEBT | ||||||
Subordinated Debt | $ 5,000,000 | $ 5,000,000 | ||||
Term Loan and Security Agreement | Financial Covenant | ||||||
DEBT | ||||||
Interest rate basis | LIBOR | |||||
Prior Term Loan | Term Loan | ||||||
DEBT | ||||||
Quarterly basis installment amount | $ 219 |
DEBT - Term Loan Agreement (Det
DEBT - Term Loan Agreement (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 01, 2022 | Jan. 02, 2021 | Jun. 28, 2018 | |
DEBT | |||
Loss from extinguishment of debt | $ 1,972 | $ (1,800) | |
Prior Term Loan | |||
DEBT | |||
Loss from extinguishment of debt | $ (1,800) | ||
Prior Term Loan | Term Loan | |||
DEBT | |||
Quarterly basis installment amount | $ 219 | ||
Face amount of loan | $ 17,500 |
DEBT - PPP Loan and Aggregate m
DEBT - PPP Loan and Aggregate maturities (Details) - USD ($) $ in Thousands | May 23, 2021 | Aug. 03, 2020 | Jan. 01, 2022 | Jan. 02, 2021 |
Aggregate maturities of bank debt related to the Loan Agreement | ||||
2022 | $ 1,594 | |||
2023 | 2,125 | |||
2024 | 2,125 | |||
2025 | 34,728 | |||
Total | 40,572 | |||
Long-term Debt | ||||
Aggregate maturities of bank debt related to the Loan Agreement | ||||
Unamortized debt issuance costs | $ 1,027 | $ 1,275 | ||
PPP Loan | ||||
DEBT | ||||
Amount of interest forgiven | $ 16 | |||
PPP Loan | ||||
DEBT | ||||
Loan proceeds | $ 1,956 | |||
Amount of principal forgiven | $ 1,956 | |||
Fixed rate interest | 1.00% | |||
Period for loan forgiveness | 10 months |
DEBT - Sale Leaseback Transacti
DEBT - Sale Leaseback Transactions (Details) $ in Thousands | Jan. 22, 2018USD ($) | May 13, 2015USD ($)period | May 12, 2015 | Mar. 24, 2009USD ($) | Feb. 25, 2009 | Jan. 01, 2022USD ($) | Jan. 02, 2021USD ($) | May 31, 2020USD ($) | May 01, 2020USD ($)item |
Sale Leaseback Transaction [Line Items] | |||||||||
Property and equipment, net | $ 4,128 | $ 4,789 | |||||||
ROU asset | 14,383 | 3,625 | |||||||
Lease liabilities, current | 3,133 | 2,349 | |||||||
Lease liabilities, noncurrent | $ 12,034 | $ 1,493 | |||||||
Adjustments resulting from lease amendment agreement | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Property and equipment, net | $ (2,357) | $ (2,357) | |||||||
ROU asset | $ 1,457 | 1,457 | |||||||
Lease liabilities, current | 264 | ||||||||
Lease liabilities, noncurrent | $ 1,193 | ||||||||
Operating Lease, Third Amendment | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Number of options to extend | item | 2 | ||||||||
Extension term | 5 years | ||||||||
Summer Infant (USA), Inc. | Faith Realty | Sale-leaseback definitive agreement | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Sale proceeds | $ 4,052 | ||||||||
Repurchase price as a percentage of the initial sale price | 110.00% | ||||||||
Summer Infant (USA), Inc. | Faith Realty | Original Lease | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Annual rent | $ 390 | ||||||||
Lease term | 7 years | ||||||||
Summer Infant (USA), Inc. | Faith Realty | Amended Lease | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Annual rent | $ 429 | ||||||||
Lease term | 2 years | ||||||||
Leasehold improvement allowance | $ 78 | ||||||||
Summer Infant (USA), Inc. | Faith Realty | Amended Lease, Optional Extension | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Annual rent | $ 468 | ||||||||
Number of extensions | period | 1 | ||||||||
Lease term | 3 years | 5 years | |||||||
Prior notice required for extension | 12 months | ||||||||
Leasehold improvement allowance | $ 234 | ||||||||
Summer Infant (USA), Inc. | Faith Realty | Second Amendment | |||||||||
Sale Leaseback Transaction [Line Items] | |||||||||
Annual rent | $ 468 | ||||||||
Lease term | 3 years |
INCOME TAXES - Tax Act (Details
INCOME TAXES - Tax Act (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 01, 2022 | Jan. 02, 2021 | Dec. 29, 2018 | Dec. 30, 2017 | |
Tax Cuts and Jobs Act | ||||
Federal statutory income tax rate | 21.00% | 35.00% | ||
Deferred tax asset, non-deductible interest | $ 1,919 | $ 1,643 |
INCOME TAXES - Income Tax Expen
INCOME TAXES - Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Current: | ||
Federal | $ 108 | |
Foreign | 2 | |
State and local | $ 22 | 2 |
Total current | 22 | 112 |
Deferred: | ||
Federal | 718 | (5) |
Foreign | 237 | 6 |
State and local | 200 | 4 |
Total deferred | 1,155 | 5 |
Total provision | $ 1,177 | $ 117 |
INCOME TAXES - Deferred Income
INCOME TAXES - Deferred Income Taxes (Details) - USD ($) $ in Thousands | Jan. 01, 2022 | Jan. 02, 2021 |
Deferred tax assets: | ||
Accounts receivable | $ 4 | $ 51 |
Inventory and Uniform Capitalization reserve | 467 | 475 |
Interest deduction limitation | 1,919 | 1,643 |
Lease Liability and accrued expenses | 3,912 | 806 |
Research and development credit | 2,030 | 2,292 |
Foreign tax credit | 795 | 795 |
Net operating loss carry-forward | 2,735 | 2,565 |
Total deferred tax assets | 11,862 | 8,627 |
Deferred tax liabilities: | ||
Intangible assets and other | (2,271) | (2,132) |
ROU Assets and deferred rent | (3,745) | (833) |
Property, plant and equipment | (83) | 28 |
Total deferred tax liabilities | (6,099) | (2,937) |
Valuation allowance | (5,915) | (4,689) |
Deferred tax liabilities and valuation allowance | (12,014) | (7,626) |
Net deferred income tax asset | $ (152) | $ (1,001) |
INCOME TAXES - Reconciliation (
INCOME TAXES - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Effective Income Tax Rate Reconciliation | ||
Tax benefit at statutory rate | $ (361) | $ (207) |
State income taxes, net of U.S. federal income tax benefit | 176 | 5 |
Adjustment to uncertain tax position | 7,543 | |
Stock options | 16 | 5 |
Foreign tax rate differential | (49) | 2 |
Tax credits | 262 | 258 |
Worthless stock deduction | (7,435) | |
Non-deductible expenses/Non-taxable income including PPP | (428) | 149 |
Expiration of unexercised stock options | 24 | 90 |
Increase/(Decrease) in valuation allowance | 1,512 | (255) |
Other | 25 | (38) |
Total provision | $ 1,177 | 117 |
Worthless stock deducted for income tax purposes | $ 26,933 |
INCOME TAXES - NOL Carryforward
INCOME TAXES - NOL Carryforwards and Uncertain Tax Positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Net operating loss carryforwards | ||
Valuation Allowance | $ 5,915 | $ 4,689 |
Writedown related to interest deduction limitations | 2,714 | 2,438 |
Accrued interest and penalties relating to uncertain tax positions | 0 | |
Reconciliation of Unrecognized Tax positions | ||
Balance, at beginning of the year | 7,543 | 0 |
Increase for tax positions related to the current year | 7,543 | |
Balance, at end of year | $ 7,543 | 7,543 |
Minimum | ||
Net operating loss carryforwards | ||
Period subject to examination by major taxing jurisdictions | 2 years | |
Maximum | ||
Net operating loss carryforwards | ||
Period subject to examination by major taxing jurisdictions | 6 years | |
Federal and state | ||
Net operating loss carryforwards | ||
Net operating loss carryforwards | $ 6,563 | |
Foreign | Canada | ||
Net operating loss carryforwards | ||
Net operating loss carryforwards | 1,832 | |
Foreign | Asia | ||
Net operating loss carryforwards | ||
Net operating loss carryforwards | 543 | |
Foreign | United Kingdom | ||
Net operating loss carryforwards | ||
Net operating loss carryforwards | 2,028 | |
State and foreign | ||
Net operating loss carryforwards | ||
Valuation Allowance | $ 3,201 | $ 2,251 |
SHARE BASED COMPENSATION - Summ
SHARE BASED COMPENSATION - Summary of Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Jan. 01, 2022 | Jan. 02, 2021 | Oct. 02, 2021 | May 31, 2021 | Apr. 30, 2021 | |
Selling, general and administrative expenses | |||||
SHARE BASED COMPENSATION | |||||
Share-based compensation expense | $ 327 | $ 253 | |||
2012 Plan | |||||
SHARE BASED COMPENSATION | |||||
Number of shares authorized under the plan | 374,889 | 374,889 | 188,889 | ||
Shares available to grant | 202,576 |
SHARE BASED COMPENSATION - Stoc
SHARE BASED COMPENSATION - Stock Options (Details) - Stock Options - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Weighted average assumptions | ||
Expected life (in years) | 4 years 7 months 6 days | 4 years 8 months 12 days |
Risk-free interest rate | 0.70% | 0.30% |
Volatility | 105.30% | 98.90% |
Dividend yield | 0.00% | 0.00% |
Forfeiture rate | 50.60% | 51.90% |
Additional information | ||
Weighted-average grant date fair value of options granted (in dollars per share) | $ 9.95 | $ 2.61 |
Outstanding stock options expected to vest (in shares) | 49,179 | |
Intrinsic value of options exercised | $ 69 | $ 13 |
Number Of Shares | ||
Outstanding at beginning of year (in shares) | 60,639 | |
Granted (in shares) | 52,000 | |
Exercised or released (in shares) | (7,965) | |
Canceled or forfeited (in shares) | (33,705) | |
Expired (in shares) | (334) | |
Outstanding at end of year (in shares) | 70,635 | 60,639 |
Options exercisable at end of year (in shares) | 13,425 | |
Weighted-Average Exercise Price | ||
Outstanding at beginning of year (in dollars per share) | $ 10.63 | |
Granted (in dollars per share) | 13.41 | |
Exercised or released (in dollars per share) | 8.03 | |
Canceled or forfeited (in dollars per share) | 13.77 | |
Expired (in dollars per share) | 66.96 | |
Outstanding at end of year (in dollars per share) | 11.20 | $ 10.63 |
Options exercisable at January 2, 2021 (in dollars per share) | $ 11.14 |
SHARE BASED COMPENSATION - St_2
SHARE BASED COMPENSATION - Stock Options by Exercise Price (Details) - Stock Options - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Options Outstanding | ||
Number Outstanding (in shares) | 70,635 | |
Remaining Contractual Life (years) | 8 years 3 months 18 days | |
Weighted Average Exercise Price (in dollars per share) | $ 11.20 | |
Options Exercisable | ||
Number Exercisable (in shares) | 13,425 | |
Remaining Contractual Life (in years) | 5 years 10 months 24 days | |
Weighted Average Exercise Price (in dollars per share) | $ 11.14 | |
Share based compensation, additional information | ||
Aggregate intrinsic value of options outstanding | $ 39 | $ 73 |
Aggregate intrinsic value of options exercisable | 39 | $ 73 |
Unrecognized compensation cost | $ 204 | |
Weighted average vesting period for recognition of unrecognized cost | 3 years 2 months 12 days | |
$3.51 - $6.00 | ||
Range of Exercise Prices | ||
Exercise price, low end of range (in dollars per share) | $ 3.51 | |
Exercise price, high end of range (in dollars per share) | $ 6 | |
Options Outstanding | ||
Number Outstanding (in shares) | 13,056 | |
Remaining Contractual Life (years) | 7 years 4 months 24 days | |
Weighted Average Exercise Price (in dollars per share) | $ 3.64 | |
Options Exercisable | ||
Number Exercisable (in shares) | 3,291 | |
Remaining Contractual Life (in years) | 7 years 4 months 24 days | |
Weighted Average Exercise Price (in dollars per share) | $ 3.64 | |
$6.01 - $12.00 | ||
Range of Exercise Prices | ||
Exercise price, low end of range (in dollars per share) | 6.01 | |
Exercise price, high end of range (in dollars per share) | $ 12 | |
Options Outstanding | ||
Number Outstanding (in shares) | 19,840 | |
Remaining Contractual Life (years) | 8 years 3 months 18 days | |
Weighted Average Exercise Price (in dollars per share) | $ 9.26 | |
Options Exercisable | ||
Number Exercisable (in shares) | 5,895 | |
Remaining Contractual Life (in years) | 6 years 8 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $ 7.71 | |
$12.00 - $20.00 | ||
Range of Exercise Prices | ||
Exercise price, low end of range (in dollars per share) | 12.01 | |
Exercise price, high end of range (in dollars per share) | $ 20 | |
Options Outstanding | ||
Number Outstanding (in shares) | 36,396 | |
Remaining Contractual Life (years) | 8 years 10 months 24 days | |
Weighted Average Exercise Price (in dollars per share) | $ 14.21 | |
Options Exercisable | ||
Number Exercisable (in shares) | 2,896 | |
Remaining Contractual Life (in years) | 4 years 3 months 18 days | |
Weighted Average Exercise Price (in dollars per share) | $ 17.11 | |
$20.01 - $30.00 | ||
Range of Exercise Prices | ||
Exercise price, low end of range (in dollars per share) | 20.01 | |
Exercise price, high end of range (in dollars per share) | $ 30 | |
Options Outstanding | ||
Number Outstanding (in shares) | 336 | |
Remaining Contractual Life (years) | 3 years 2 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $ 23.76 | |
Options Exercisable | ||
Number Exercisable (in shares) | 336 | |
Remaining Contractual Life (in years) | 3 years 2 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $ 23.76 | |
$30.01 - $48.51 | ||
Range of Exercise Prices | ||
Exercise price, low end of range (in dollars per share) | 30.01 | |
Exercise price, high end of range (in dollars per share) | $ 48.51 | |
Options Outstanding | ||
Number Outstanding (in shares) | 1,007 | |
Remaining Contractual Life (years) | 1 year 1 month 6 days | |
Weighted Average Exercise Price (in dollars per share) | $ 34.43 | |
Options Exercisable | ||
Number Exercisable (in shares) | 1,007 | |
Remaining Contractual Life (in years) | 1 year 1 month 6 days | |
Weighted Average Exercise Price (in dollars per share) | $ 34.43 |
SHARE BASED COMPENSATION - Rest
SHARE BASED COMPENSATION - Restricted Stock (Details) $ / shares in Units, $ in Thousands | Mar. 13, 2020shares | Jan. 01, 2022USD ($)$ / sharesshares |
Additional disclosures | ||
Reverse stock split | 0.1111 | |
Outstanding common shares | 2,108,743 | |
Restricted shares | ||
SHARE BASED COMPENSATION | ||
Required payment from grantee | $ | $ 0 | |
Number of Shares | ||
Non-vested restricted stock awards, Beginning of year | 14,967 | |
Granted (in shares) | 20,960 | |
Vested and released (in shares) | (24,539) | |
Forfeited (in shares) | (5,316) | |
Non-vested restricted stock awards, End of year | 6,072 | |
Grant Date Fair Value | ||
Non-vested restricted stock awards, Beginning of year (in dollars per share) | $ / shares | $ 8.68 | |
Granted (in dollars per share) | $ / shares | 11.45 | |
Vested and released (in dollars per share) | $ / shares | 11.13 | |
Forfeited (in dollars per share) | $ / shares | 9.73 | |
Non-vested restricted stock awards, End of year (in dollars per share) | $ / shares | $ 7.44 | |
Additional disclosures | ||
Unrecognized compensation cost | $ | $ 21 | |
Weighted average vesting period for recognition of unrecognized cost | 2 years |
WEIGHTED AVERAGE COMMON SHARE_2
WEIGHTED AVERAGE COMMON SHARES - Reconciliation of Basic and Diluted Net Income (Loss) Attributable to Common Stockholders (Details) - $ / shares | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Calculation of Basic and Diluted EPS | ||
Weighted-average common shares outstanding - basic | 2,152,926 | 2,119,499 |
Weighted-average common shares outstanding - diluted | 2,152,926 | 2,119,499 |
Earnings per share - basic | $ (1.35) | $ (0.52) |
Earnings per share - diluted | $ (1.35) | $ (0.52) |
WEIGHTED AVERAGE COMMON SHARE_3
WEIGHTED AVERAGE COMMON SHARES - Anti-dilutive securities (Details) - shares | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
Stock Options | ||
WEIGHTED AVERAGE COMMON SHARES | ||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 70,635 | 60,639 |
Restricted shares | ||
WEIGHTED AVERAGE COMMON SHARES | ||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 6,072 | 14,967 |
PROFIT SHARING PLAN (Details)
PROFIT SHARING PLAN (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
PROFIT SHARING PLAN | ||
Matching expense | $ 235 | $ 278 |
MAJOR CUSTOMERS (Details)
MAJOR CUSTOMERS (Details) - Sales - Customer concentration risk - customer | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
MAJOR CUSTOMERS | ||
Number of significant customers | 7 | 7 |
Number of customers individually representing more than 10% of sales | 3 | 3 |
Amazon.com | ||
MAJOR CUSTOMERS | ||
Percentage of concentration risk | 38.00% | 33.00% |
Walmart | ||
MAJOR CUSTOMERS | ||
Percentage of concentration risk | 24.00% | 28.00% |
Target | ||
MAJOR CUSTOMERS | ||
Percentage of concentration risk | 18.00% | 17.00% |
Seven customers | ||
MAJOR CUSTOMERS | ||
Percentage of concentration risk | 88.00% | 87.00% |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Summary of Leases (Details) $ in Thousands | Feb. 28, 2021USD ($) | May 31, 2020USD ($)item | Apr. 30, 2020 | Jan. 01, 2022USD ($)item | Jan. 02, 2021USD ($) | Oct. 31, 2021USD ($) |
Leases | ||||||
Derecognition of a building sale-leaseback financial obligation | $ 2,390 | |||||
Derecognition of a building sale-leaseback fixed asset, net of depreciation | 2,357 | |||||
ROU asset | $ 14,383 | 3,625 | ||||
Operating lease liability | $ 12,034 | $ 1,493 | ||||
Term of secured borrowings used to estimate incremental borrowing rate | 5 years | |||||
Minimum | ||||||
Leases | ||||||
Remaining lease term | 2 months 1 day | |||||
Maximum | ||||||
Leases | ||||||
Remaining lease term | 4 years 9 months 29 days | |||||
Woonsocket, RI | ||||||
Leases | ||||||
Number of options to extend | item | 2 | |||||
Extension term | 5 years | |||||
Derecognition of a building sale-leaseback financial obligation | $ 2,390 | |||||
Derecognition of a building sale-leaseback fixed asset, net of depreciation | 2,357 | |||||
ROU asset | 1,457 | |||||
Operating lease liability | $ 1,457 | |||||
Riverside, CA | ||||||
Leases | ||||||
Extension term | 61 months | |||||
Sublease term | 12 months | |||||
Canada | ||||||
Leases | ||||||
Number of options to extend | item | 1 | |||||
Extension term | 5 years | |||||
Hong Kong | ||||||
Leases | ||||||
Extension term | 2 years | |||||
ROU asset | $ 291 | |||||
Operating lease liability | $ 291 | |||||
Office space and distribution centers | ||||||
Leases | ||||||
Cash incentives from the landlord | $ 0 | |||||
Lease Amendment | Woonsocket, RI | ||||||
Leases | ||||||
Number of options to extend | item | 2 | |||||
Extension term | 5 years | |||||
Lease Amendment | Riverside, CA | ||||||
Leases | ||||||
Extension term | 60 months | |||||
Increase to ROU Assets due to lease modification | $ 13,583 | |||||
Increase to lease liabilities due to lease modification | $ 13,583 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Components of lease expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
COMMITMENTS AND CONTINGENCIES | ||
Operating lease cost | $ 3,553 | $ 2,710 |
Variable lease cost | 909 | 1,057 |
Less: sublease income | (1,199) | (749) |
Total lease expense | $ 3,263 | $ 3,018 |
Weighted-average remaining lease term (in years) | 4 years 7 months 6 days | 1 year 2 months 12 days |
Weighted-average discount rate: | 3.35% | 5.00% |
Cash paid for amounts included in the measurement of the Company's lease liabilities | $ 2,969 | $ 2,911 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Maturities of operating lease liabilities (Details) $ in Thousands | Jan. 01, 2022USD ($) |
Maturities of the operating lease liabilities | |
2022 | $ 3,592 |
2023 | 3,498 |
2024 | 3,347 |
2025 | 3,284 |
2026 | 2,672 |
Less imputed interest | (1,226) |
Total | $ 15,167 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES - Future fixed sublease receipts (Details) $ in Thousands | Jan. 01, 2022USD ($) |
Future fixed sublease receipts under non-cancelable operating lease agreements | |
2022 | $ 1,348 |
Total | $ 1,348 |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES - Employment contracts (Details) - Summer Infant Europe Limited $ in Thousands | 12 Months Ended |
Jan. 01, 2022USD ($) | |
COMMITMENTS AND CONTINGENCIES | |
Termination benefit provisions | $ 0 |
Minimum | |
COMMITMENTS AND CONTINGENCIES | |
Employer's contribution as a percentage of employee's annual salary | 1.00% |
Maximum | |
COMMITMENTS AND CONTINGENCIES | |
Employer's contribution as a percentage of employee's annual salary | 7.00% |
GEOGRAPHICAL INFORMATION (Detai
GEOGRAPHICAL INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 01, 2022 | Jan. 02, 2021 | |
GEOGRAPHICAL INFORMATION | ||
Net revenue | $ 143,665 | $ 155,299 |
Total assets | 91,230 | 74,737 |
Total long-lived assets | 29,997 | 21,259 |
United States | ||
GEOGRAPHICAL INFORMATION | ||
Net revenue | 132,153 | 140,173 |
Total assets | 88,836 | 70,689 |
Total long-lived assets | 29,224 | 19,983 |
All Other | ||
GEOGRAPHICAL INFORMATION | ||
Net revenue | 11,512 | 15,126 |
Total assets | 2,394 | 4,048 |
Total long-lived assets | $ 773 | $ 1,276 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands | Mar. 16, 2022USD ($)$ / shares | Jan. 28, 2022USD ($) |
New Term Loan Agreement | Term Loan and Security Agreement | ||
Subsequent events | ||
Subordinated Debt | $ 5,000,000 | $ 5,000,000 |
Subsequent Event | New Term Loan Agreement | ||
Subsequent events | ||
Loan agreement, Interest percentage | 5.00% | |
Percentage of highest amount of borrowings outstanding than Principal outstanding under New Loan Agreement | 2.50% | |
Subsequent Event | New Term Loan Agreement | Forecast [Member] | ||
Subsequent events | ||
Loan agreement, Interest percentage | 9.00% | |
Subsequent Event | New Term Loan Agreement | BofA Agreement | ||
Subsequent events | ||
Minimum Credit availability | 3,500 | $ 3,500 |
Aggregate amount not to exceed | $ 1,000 | $ 1,000 |
Fixed charge coverage ratio | 1 | 1 |
Subsequent Event | New Term Loan Agreement | BofA Agreement | Maximum | ||
Subsequent events | ||
Borrowing base of eligible accounts under loan agreements, Amount | $ 11,000 | $ 11,000 |
Subsequent Event | New Term Loan Agreement | BofA Agreement | Amazon | Minimum | ||
Subsequent events | ||
Borrowing base as a percentage of eligible accounts under loan agreements | 45.00% | 45.00% |
Subsequent Event | New Term Loan Agreement | BofA Agreement | Amazon | Maximum | ||
Subsequent events | ||
Borrowing base as a percentage of eligible accounts under loan agreements | 55.00% | 55.00% |
Subsequent Event | New Term Loan Agreement | Term Loan and Security Agreement | ||
Subsequent events | ||
Subordinated Debt | $ 5,000 | |
Period for funding of Tranches | 30 days | |
Subsequent Event | Merger Agreement | BofA Agreement | Amazon | Minimum | ||
Subsequent events | ||
Borrowing base of eligible accounts under loan agreements, Amount | $ 7,000 | $ 7,000 |
Subsequent Event | Merger Agreement | Kids 2 | ||
Subsequent events | ||
Sale of Stock, Price Per Share | $ / shares | $ 12 | |
Subsequent Event | Wynnefield Partners Small Cap Value, L.P. and Wynnefield Partners Small Cap Value, L.P. I | New Term Loan Agreement | ||
Subsequent events | ||
Ownership percentage | 35.00% |