Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 07, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | New Age Beverages Corp | |
Entity Central Index Key | 0001579823 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 92,592,395 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 27,537 | $ 60,842 |
Accounts receivable, net of allowance of $717 and $535, respectively | 11,535 | 11,012 |
Inventories | 33,657 | 36,718 |
Prepaid expenses and other | 6,036 | 4,384 |
Total current assets | 78,765 | 112,956 |
Long-term assets: | ||
Identifiable intangible assets, net | 42,546 | 43,443 |
Right-of-use lease assets | 38,261 | 38,458 |
Property and equipment, net | 28,716 | 28,443 |
Restricted cash, net of current portion | 17,230 | 3,729 |
Goodwill | 10,284 | 10,284 |
Deferred income taxes | 9,066 | 9,128 |
Deposits and other | 4,360 | 4,689 |
Total assets | 229,228 | 251,130 |
Current liabilities: | ||
Accounts payable | 12,645 | 13,259 |
Accrued liabilities | 41,960 | 49,451 |
Current portion of business combination liabilities | 5,648 | 5,508 |
Current maturities of long-term debt | 1,504 | 11,208 |
Total current liabilities | 61,757 | 79,426 |
Long-term liabilities: | ||
Long-term debt, net of current maturities | 12,241 | 12,802 |
Operating lease liabilities, net of current portion: Lease liability | 35,135 | 35,513 |
Operating lease liabilities, net of current portion: Deferred lease financing obligation | 16,378 | 16,541 |
Deferred income taxes | 5,317 | 5,441 |
Other | 9,606 | 9,132 |
Total liabilities | 140,434 | 158,855 |
Contingencies (Note 10) | ||
Stockholders' equity: | ||
Common Stock; $0.001 par value. Authorized 200,000 shares; issued and outstanding 87,245 and 81,873 shares as of March 31, 2020 and December 31, 2019, respectively | 87 | 82 |
Additional paid-in capital | 213,385 | 203,862 |
Accumulated other comprehensive income (loss) | (589) | 802 |
Accumulated deficit | (124,089) | (112,471) |
Total stockholders' equity | 88,794 | 92,275 |
Total liabilities and stockholders' equity | $ 229,228 | $ 251,130 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowance | $ 717 | $ 535 |
Common Stock, par value | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 200,000,000 | 200,000,000 |
Common Stock, shares issued | 87,245,000 | 81,873,000 |
Common Stock, shares outstanding | 87,245,000 | 81,873,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Net revenue | $ 63,693 | $ 58,307 |
Cost of goods sold | 22,169 | 19,731 |
Gross profit | 41,524 | 38,576 |
Operating expenses: | ||
Commissions | 19,515 | 18,038 |
Selling, general and administrative | 30,608 | 26,842 |
Depreciation and amortization expense | 1,781 | 2,236 |
Total operating expenses | 51,904 | 47,116 |
Operating loss | (10,380) | (8,540) |
Non-operating income (expense): | ||
Gain (loss) from sale of property and equipment | (80) | 6,442 |
Interest expense | (572) | (1,646) |
Gain (loss) from change in fair value of derivatives | (326) | 470 |
Interest and other income (expense), net | 463 | (42) |
Loss before income taxes | (10,895) | (3,316) |
Income tax benefit (expense) | (723) | 1,700 |
Net loss | (11,618) | (1,616) |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments, net of tax | (1,391) | 427 |
Comprehensive loss | $ (13,009) | $ (1,189) |
Net loss per share (basic and diluted) | $ (0.14) | $ (0.02) |
Weighted average number of shares of Common Stock outstanding (basic and diluted) | 85,371 | 75,226 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2018 | $ 75 | $ 176,471 | $ 626 | $ (22,636) | $ 154,536 |
Balance, shares at Dec. 31, 2018 | 75,067,000 | ||||
Issuance of common stock for exercise of stock options | 418 | 418 | |||
Issuance of common stock for exercise of stock options, shares | 200,000 | ||||
Issuance of common stock for grant of restricted stock awards | 576 | 576 | |||
Issuance of common stock for grant of restricted stock awards, shares | 126,000 | ||||
Stock-based compensation expense | 2,127 | 2,127 | |||
Net change in other comprehensive income | 427 | 427 | |||
Net loss | (1,616) | (1,616) | |||
Balance at Mar. 31, 2019 | $ 75 | 179,592 | 1,053 | (24,552) | 156,468 |
Balance, shares at Mar. 31, 2019 | 75,393,000 | ||||
Balance at Dec. 31, 2019 | $ 82 | 203,862 | 802 | (112,471) | 92,275 |
Balance, shares at Dec. 31, 2019 | 81,873,000 | ||||
Issuance of common stock for ATM public offering, net of offering costs | $ 5 | 8,281 | 8,286 | ||
Issuance of common stock for ATM public offering, net of offering costs, shares | 4,939,000 | ||||
Issuance of common stock for exercise of stock options | 4 | $ 4 | |||
Issuance of common stock for exercise of stock options, shares | 2,000 | 2 | |||
Issuance of common stock for vesting of restricted stock awards | |||||
Issuance of common stock for vesting of restricted stock awards, shares | 431,000 | ||||
Stock-based compensation expense | 1,238 | 1,238 | |||
Net change in other comprehensive income | (1,391) | (1,391) | |||
Net loss | (11,618) | (11,618) | |||
Balance at Mar. 31, 2020 | $ 87 | $ 213,385 | $ (589) | $ (124,089) | $ 88,794 |
Balance, shares at Mar. 31, 2020 | 87,245,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (11,618) | $ (1,616) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,879 | 2,236 |
Non-cash lease expense | 1,282 | 1,389 |
Stock-based compensation expense | 1,357 | 3,287 |
Loss (gain) from change in fair value of derivatives | 326 | (470) |
Accretion and amortization of debt discount and issuance costs | 140 | 1,113 |
Loss (gain) from sale of property and equipment | 80 | (6,442) |
Change in fair value of earnout obligations | 63 | |
Deferred income tax benefit | (39) | (13,916) |
Expense for make-whole premium | 480 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (523) | 387 |
Inventories | 3,068 | (2,470) |
Prepaid expenses, deposits and other | 85 | 122 |
Accounts payable | (675) | 2,231 |
Other accrued liabilities | (8,946) | 7,468 |
Net cash used in operating activities | (13,521) | (6,201) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sale of equipment | 174 | |
Capital expenditures for property and equipment | (1,591) | (283) |
Net proceeds from sale of land and building in Japan: | ||
Related to sale of property | 35,873 | |
Repair obligation | 1,675 | |
Security deposit under sale leaseback arrangement | (1,800) | |
Net cash provided by (used in) investing activities | (1,417) | 35,465 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Principal payments on borrowings | (10,075) | (16,196) |
Proceeds from borrowings | 36,550 | |
Proceeds from issuance of common stock | 8,288 | |
Proceeds from deferred lease financing obligation | 17,640 | |
Payments under deferred lease financing obligation | (158) | |
Proceeds from exercise of stock options | 4 | 418 |
Debt issuance costs paid | (57) | (250) |
Payments for deferred offering costs | (2) | |
Cash paid for make-whole premium | (480) | |
Net cash provided by (used in) financing activities | (2,000) | 37,682 |
Effect of foreign currency translation changes | (1,366) | 566 |
Net increase (decrease) in cash, cash equivalents and restricted cash | (18,304) | 67,512 |
Cash, cash equivalents and restricted cash at beginning of period | 64,571 | 45,856 |
Cash, cash equivalents and restricted cash at end of period | 46,267 | 113,368 |
SUMMARY OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH: | ||
Cash and cash equivalents at end of period | 27,537 | 109,956 |
Restricted cash at end of period: | ||
Current (included in prepaid expenses and other) | 1,500 | |
Long-term | 17,230 | 3,412 |
Total | 46,267 | 113,368 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 227 | 55 |
Cash paid for income taxes | 14,052 | 1,200 |
Cash paid for amounts included in the measurement of operating lease liabilities | 2,394 | 1,874 |
Right-of-use assets acquired in exchange for operating lease liabilities | 1,889 | 18,366 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Restricted stock granted for prepaid compensation | 576 | |
Increase in payables for: Debt discount and issuance costs | 179 | 654 |
Increase in payables for: Capital expenditures | $ 35 | $ 128 |
Basis of Presentation and Signf
Basis of Presentation and Signficant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Signficant Accounting Policies | NOTE 1 —BASIS OF PRESENTATION AND SIGNFICANT ACCOUNTING POLICIES Overview New Age Beverages Corporation (the “Company”) was formed under the laws of the State of Washington on April 26, 2010. The Company is a healthy beverages and lifestyles company engaged in the development and commercialization of a portfolio of organic, natural and other better-for-you healthy beverages, liquid dietary supplements, cannabidiol (“CBD”) topical products, and other healthy lifestyle products. Segments The Company’s chief operating decision maker (the “CODM”), who is the Company’s Chief Executive Officer, allocates resources and assesses performance based on financial information of the Company. The CODM reviews financial information presented for each reportable segment for purposes of making operating decisions and assessing financial performance. The Company’s CODM assesses performance and allocates resources based on the financial information of two operating segments, the Noni by NewAge segment and the NewAge segment. These two reportable segments focus on the sale of distinctly different beverage products and are managed separately because they have different marketing strategies, customer bases, and economic characteristics. Please refer to Note 13 for additional information about the Company’s operating segments. Basis of Presentation The unaudited condensed consolidated financial statements, which include the accounts of the Company and its wholly-owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All intercompany balances and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, certain information and footnote disclosures required by U.S. GAAP for complete financial statements have been condensed or omitted in accordance with such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. These unaudited condensed consolidated financial statements for the three months ended March 31, 2020 should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended December 31, 2019, included in the Company’s 2019 Annual Report on Form 10-K filed with the SEC on March 16, 2020 and as amended on April 28, 2020 (the “2019 Form 10-K”). The accompanying condensed consolidated balance sheet and related disclosures as of December 31, 2019 have been derived from the Company’s audited financial statements. The Company’s financial condition as of March 31, 2020 and operating results for the three months ended March 31, 2020 are not necessarily indicative of the financial condition and results of operations that may be expected for any future interim period or for the year ending December 31, 2020. Use of Estimates The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires the Company to make judgments, assumptions, and estimates that affect the amounts reported in its consolidated financial statements and accompanying notes. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes are reasonable under the circumstances, to determine the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s significant accounting estimates include, but are not necessarily limited to, impairment of goodwill and long-lived assets; valuation assumptions for earnout obligations and assets acquired in business combinations; valuation assumptions for stock options, warrants and equity instruments issued for goods or services; estimated useful lives for identifiable intangible assets and property and equipment; allowances for sales returns, chargebacks and inventory obsolescence; deferred income taxes and the related valuation allowances; and the evaluation and measurement of contingencies. Additionally, the full impact of COVID-19 is unknown and cannot be reasonably estimated. However, the Company has made appropriate accounting estimates based on the facts and circumstances available as of the reporting date. To the extent there are material differences between the Company’s estimates and the actual results, the Company’s future consolidated results of operation will be affected. Recent Accounting Pronouncements Recently Adopted Standards. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Codification Improvements to Topic 326, Financial Instruments – Credit Losses. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. Standards Required to be Adopted in Future Years. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. No other recently issued accounting pronouncements are expected to have a material impact on the Company’s consolidated financial statements. |
Liquidity and Going Concern
Liquidity and Going Concern | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | NOTE 2 — LIQUIDITY AND GOING CONCERN As of March 31, 2020, the Company had an accumulated deficit of $124.1 million and the Company incurred a net loss of $11.6 million for the three months ended March 31, 2020. Net cash used in operating activities amounted to $13.5 million for the three months ended March 31, 2020, of which approximately $13.1 million was attributable to income tax payments paid in March 2020 related to the sale leaseback discussed in Note 5. As discussed in Note 6, the Company entered into the third amendment and waiver (the “Third Amendment”) to the EWB Credit Facility in March 2020. The Third Amendment is expected to have a significant impact on the Company’s liquidity and capital resources for the 12-month period ending March 31, 2021. The Third Amendment required the Company to deposit an initial amount of $15.1 million in restricted cash balances with EWB that was funded in March 2020. In addition, for any future amounts borrowed under the EWB Revolver, the Company is required to increase restricted cash deposits by the corresponding amount of the borrowings. As a result, the Company’s available cash and cash equivalents decreased from $60.8 million at December 31, 2019 to $27.5 million at March 31, 2020. As discussed in Note 14, on April 14, 2020, the Company entered into a loan with EWB in an aggregate principal amount of approximately $6.9 million under the Paycheck Protection Program (the “PPP Loan”) pursuant to the recently enacted U.S. Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). This loan is unsecured, and the Company may apply to EWB for forgiveness of the loan in accordance with the terms of the CARES Act. Also, as discussed in Note 14, during April 2020, the Company sold an aggregate of approximately 5.3 million shares of Common Stock under the ATM Agreement for net proceeds of approximately $7.4 million. The Company has begun a new product and marketing strategy to increase demand for the Company’s products. The Company is also actively pursuing strategic alternatives relating to the U.S retail brands and the BWR division, which could significantly improve its overall financial performance and reduce cash flow needs. As discussed in Note 14, the Company also initiated a restructuring plan that is designed to achieve annualized selling, general and administrative cost reductions between $5.0 million and $7.0 million. Management believes the existing cash resources, combined with proceeds of $6.9 million from the PPP Loan under the CARES Act, proceeds received under the ATM Agreement subsequent to March 31, 2020, and significant cost-cutting efforts, will be sufficient to fund the Company’s debt and lease obligations and working capital requirements through May 2021. |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combinations | NOTE 3 — BUSINESS COMBINATIONS BWR Business Combination The Company completed a business combination with Brands Within Reach, LLC (“BWR”) in July 2019 that was accounted for using the acquisition method of accounting under ASC 805, Business Combinations Fair Value Measurement For the three months ended March 31, 2020, the accompanying condensed consolidated statements of operations include net revenue of $2.1 million and a net loss of $2.3 million for the post-acquisition results of operations of BWR. Unaudited Pro Forma Disclosures The following table summarizes on an unaudited pro forma basis, the Company’s results of operations for the three months ended March 31, 2019 giving effect to the BWR business combination as if it had occurred on January 1, 2019 (in thousands, except loss per share amount): Net revenue $ 62,764 Net loss $ (1,685 ) Net loss per share- basic and diluted $ (0.02 ) Weighted average number of shares of common stock outstanding- basic and diluted 75,334 The pro forma financial results shown above reflect the historical operating results of the Company, including the unaudited pro forma results of BWR as if this business combination and the related equity issuances had occurred at the beginning of the first full calendar year preceding the acquisition date. The calculations of pro forma net revenue and pro forma net loss give effect to the pre-acquisition operating results of BWR based on (i) the historical net revenue and net income (loss), and (ii) incremental depreciation and amortization based on the fair value of property, equipment and identifiable intangible assets acquired and the related estimated useful lives. The pro forma information presented above does not purport to represent what the actual results of operations would have been for the periods indicated, nor does it purport to represent the Company’s future results of operations. Business Combination Liabilities On December 21, 2018, the Company entered into a business combination with Morinda. The purchase consideration included the issuance of 43,804 shares of Series D Preferred Stock (the “Preferred Stock”) providing for the potential payment of up to $15.0 million (the “Milestone Dividend”) if the Adjusted EBITDA of Morinda was at least $20.0 million for the year ended December 31, 2019. If the Adjusted EBITDA of Morinda was less than $20.0 million, the Milestone Dividend was reduced whereby no Milestone Dividend was payable if actual Adjusted EBITDA was $17.0 million or lower. Adjusted EBITDA of Morinda for the year ended December 31, 2019 was less than $17.0 million and, accordingly, no Milestone Dividend was payable to the holders of the Preferred Stock. The Preferred Stock also provided for dividends at a rate of 1.5% per annum of the Milestone Dividend amount. The Company may choose to pay the Milestone Dividend and /or the annual dividend in cash or in kind, provided that if the Company chooses to pay in kind, the shares of Common Stock issued as payment therefore must be registered under the Securities Act of 1933, as amended (the “Securities Act”). The Preferred Stock terminated on April 15, 2020 and the cash dividend of approximately $0.3 million was paid on May 7, 2020. As of March 31, 2020 and December 31, 2019, the following is a summary of purchase consideration payable to the former stockholders of Morinda, and outstanding earnout obligations related to business combinations with Morinda in December 2018 and the Marley Beverage Company (“Marley”) in June 2017 (in thousands): 2020 2019 Payables to former Morinda stockholders: Excess Working Capital (“EWC”) payable in July 2020, net of discount $ 5,360 $ 5,283 Earnout under Series D preferred stock 288 225 Marley earnout obligation - (1) - (1) Total $ 5,648 $ 5,508 (1) The Company was previously obligated to make a one-time earnout payment of $1.25 million over a period of two years beginning at such time that revenue for the Marley reporting unit was equal to or greater than $15.0 million during any trailing twelve calendar month period. As of December 31, 2019, the Company determined that revenue for the Marley reporting unit was not expected to exceed the $15.0 million earnout threshold and, accordingly, there was no fair value related to this liability. The Company terminated its license agreement with Marley as of March 31, 2020 to eliminate this obligation. |
Other Financial Information
Other Financial Information | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Other Financial Information | NOTE 4 — OTHER FINANCIAL INFORMATION Inventories Inventories consisted of the following as of March 31, 2020 and December 31, 2019 (in thousands): 2020 2019 Raw materials $ 10,035 $ 12,848 Work-in-process 1,665 872 Finished goods, net 21,957 22,998 Total inventories $ 33,657 $ 36,718 Other Accrued Liabilities As of March 31, 2020 and December 31, 2019, other accrued liabilities consisted of the following (in thousands): 2020 2019 Accrued commissions $ 8,754 $ 8,914 Accrued compensation and benefits 5,999 5,868 Accrued marketing events 6,660 4,568 Deferred revenue 3,370 1,358 Income taxes payable 3,090 15,227 Current portion of operating lease liabilities 5,724 5,673 Other accrued liabilities 8,363 7,843 Total accrued liabilities $ 41,960 $ 49,451 Depreciation and Amortization Expense Depreciation expense related to property and equipment amounted to $1.0 million and $0.9 million for the three months ended March 31, 2020 and 2019, respectively. Amortization expense related to identifiable intangible assets was $0.9 million and $1.3 million for the three months ended March 31, 2020 and 2019, respectively. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | NOTE 5 — LEASES Sale Leaseback On March 22, 2019, the Company entered into an agreement with a major Japanese real estate company resulting in the sale for approximately $57.1 million of the land and building in Tokyo that serves as the corporate headquarters of the Company’s Japanese subsidiary. Concurrently with the sale, the Company entered into a lease of this property for a term of 27 years with the option to terminate the lease any time after seven years. The monthly lease cost is ¥20.0 million (approximately $185,000 based on the exchange rate as of March 31, 2020) for the initial seven-year period of the lease term. Presented below is a summary of the selling price and resulting gain on sale calculation (in thousands): Gross selling price $ 57,129 Less commissions and other expenses (1,941 ) Less repair obligations (1,675 ) Net selling price 53,513 Cost of land and building sold (29,431 ) Total gain on sale 24,082 Portion of gain related to above-market rent concession (17,640 ) Recognized gain on sale $ 6,442 The Company determined that $17.6 million of the $24.1 million gain on the sale of this property was the result of above-market rent inherent in the leaseback arrangement. The remainder of the gain of $6.4 million was attributable to the highly competitive process among the entities that bid to purchase the property, and is included in gain from sale of property and equipment in the accompanying condensed consolidated statement of operations for the three months ended March 31, 2019. The $17.6 million portion of the gain related to above-market rent is being accounted for as a deferred lease financing obligation. Accordingly, the operating lease payments are allocated to (i) reduce the operating lease liability, (ii) reduce the principal portion of the deferred lease financing obligation, and (iii) to recognize imputed interest expense at an incremental borrowing rate of 3.5% on the deferred lease financing obligation over the 20-year lease term. The present value of the future lease payments amounted to a gross operating lease liability of $31.9 million. After deducting the $17.6 million deferred lease financing obligations, the Company recognized an initial ROU asset and operating lease liability of approximately $14.3 million. Operating Leases The Company leases various office and warehouse facilities, vehicles and equipment under non-cancellable operating lease agreements that expire between April 2020 and March 2039. The Company has made accounting policy elections (i) to not apply the recognition requirements for short-term leases and (ii) for facility leases, when there are lease and non-lease components, such as common area maintenance charges, to account for the lease and non-lease components as a single lease component. For the three months ended March 31, 2020 and 2019, the Company had operating lease expense of $2.5 million and $2.3 million, respectively. As of March 31, 2020 and December 31, 2019, the weighted average remaining lease term under operating leases was 12.3 and 12.5 years, respectively. As of March 31, 2020 and December 31, 2019, the weighted average discount rate for ROU operating lease liabilities was 5.5% and 5.6%, respectively. Future Lease Payments As of March 31, 2020, future payments under operating lease agreements are as follows (in thousands): Year Ending December 31, Remainder of 2020 $ 6,436 2021 7,266 2022 5,877 2023 5,389 2024 5,222 Thereafter 28,729 Total operating lease payments 58,919 Less imputed interest (18,060 ) (1) Present value of operating lease payments $ 40,859 (1) Calculated based on the term of the respective leases using discount rates ranging from 2.0% to 10.0%. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 6 — DEBT Summary of Debt As of March 31, 2020 and December 31, 2019, debt consisted of the following (in thousands): 2020 2019 EWB Credit Facility: Term loan, net of discount of $637 and $448 as of March 31, 2020 and December 31, 2019, respectively $ 13,738 $ 14,302 Revolver - 9,700 Installment notes payable 7 8 Total 13,745 24,010 Less current maturities (1,504 ) (11,208 ) Long-term debt, less current maturities $ 12,241 $ 12,802 Future Debt Maturities As of March 31, 2020, the scheduled future maturities of long-term debt, exclusive of discount accretion, are as follows: Year Ending December 31, Remainder of 2020 $ 1,129 2021 1,503 2022 1,500 2023 10,250 Total $ 14,382 EWB Credit Facility On March 29, 2019, the Company entered into a Loan and Security Agreement (the “EWB Credit Facility”) with East West Bank (“EWB”). The EWB Credit Facility matures on March 29, 2023 and provides for (i) a term loan in the aggregate principal amount of $15.0 million, which may be increased to $25.0 million subject to the satisfaction of certain conditions (the “EWB Term Loan”) and (ii) a $10.0 million revolving loan facility (the “EWB Revolver”). The obligations of the Company under the EWB Credit Facility are secured by substantially all assets of the Company and guaranteed by certain subsidiaries of the Company Borrowings outstanding under the EWB Credit Facility initially provided for interest at the prime rate plus 0.50%. As of December 31, 2019, the prime rate was 4.75% and the contractual rate applicable to outstanding borrowings under the EWB Credit Facility was 5.25%. Pursuant to the Third Amendment discussed below, the interest rate applicable to outstanding borrowings under the EWB Credit Facility increased from 0.5% to 2.0% in excess of the prime rate beginning on March 13, 2020. As of March 31, 2020, the prime rate was 3.25% and the contractual rate applicable to outstanding borrowings under the EWB Credit Facility was 5.25%. Payments under the EWB Term Loan were interest-only through September 30, 2019, followed by monthly principal payments of $125,000 plus interest through the stated maturity date of the EWB Term Loan. The EWB Credit Facility requires compliance with certain financial and restrictive covenants and includes customary events of default. Key financial covenants include maintenance of minimum Adjusted EBITDA and a maximum Total Leverage Ratio (all as defined and set forth in the EWB Credit Facility). As of December 31, 2019, the Company was not in compliance with the financial covenants related to the EWB Credit Facility. On March 13, 2020, the Company entered into the Third Amendment to the EWB Credit Facility (the “Third Amendment”) that included a waiver of non-compliance with all financial covenants. As of March 31, 2020, the Company was in compliance with all of the terms under the EWB Credit Facility, as amended. In addition to the change in interest rate discussed above, the Third Amendment modified the Credit Facility as follows: ● The Company was required to make an initial deposit of $15.1 million in restricted cash accounts designated by EWB. The future requirement to maintain restricted cash will be reduced by the amount of future principal payments under the EWB Term Loan. As of March 31, 2020, the Company had made deposits in the restricted cash accounts for the entire $15.1 million. ● For any future amounts borrowed under the EWB Revolver, the Company is required to increase restricted cash deposits by the corresponding amount of the borrowings. ● Less stringent requirements are applicable for future compliance with the minimum adjusted EBITDA covenant, the maximum total leverage ratio, and the fixed charge coverage ratio. Additionally, compliance with the maximum total leverage ratio and the fixed charge coverage ratio have been delayed until June 30, 2021. ● The existing provision related to “equity cures” that may be employed to maintain compliance with financial covenants was increased from $5.0 million to $15.0 million for the year ending December 31, 2020, and to $10.0 million per year for each calendar year thereafter. ● The Company is required to obtain equity infusions for at least $15.0 million for the first six months of 2020, of which gross proceeds of $8.5 million were received for the three months ended March 31, 2020 as discussed in Note 7, and gross proceeds of $7.6 million were received after March 31, 2020 as discussed in Note 14. Additional equity infusions that result in gross proceeds of $13.9 million must be received by December 31, 2020. The Company evaluated the terms of the Third Amendment and determined it should be accounted for as a modification, whereby additional debt discount and issuance costs of approximately $0.2 million were incurred. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 7 — STOCKHOLDERS’ EQUITY On April 30, 2019, the Company entered into an At the Market Offering Agreement (“ATM Agreement”) with Roth Capital Partners, LLC (the “Agent”), pursuant to which the Company may offer and sell from time to time up to an aggregate of $100 million in shares of the Company’s Common Stock (the “Placement Shares”) through the Agent. The Agent is acting as sales agent and is required to use commercially reasonable efforts to sell on the Company’s behalf all of the Placement Shares requested to be sold by the Company, consistent with its normal trading and sales practices, on mutually agreed terms between the Agent and the Company. The Company has no obligation to sell any of the Placement Shares under the ATM Agreement. The Company intends to use the net proceeds from the offering for general corporate purposes, including working capital. Under the terms of the ATM Agreement, the Company agreed to pay the Agent a commission equal to 3.0% of the gross proceeds from the gross sales price of the Placement Shares up to $30 million, and 2.5% of the gross proceeds from the gross sales price of the Placement Shares in excess of $30 million. In addition, the Company has agreed to pay certain expenses incurred by the Agent in connection with the offering. Through March 31, 2020, an aggregate of approximately 10.9 million shares of Common Stock were sold for gross proceeds of approximately $29.3 million. For the three months ended March 31, 2020, an aggregate of 4.9 million shares were sold for gross proceeds of $8.5 million. Total commissions and fees were deducted for $0.2 million for the three months ended March 31, 2020. As discussed in Note 14, on May 8, 2020, the ATM Agreement was amended and restated to eliminate the termination date of April 30, 2020. As amended and restated, the ATM Agreement will terminate when all of the Placement Shares have been sold, or earlier by the Company upon five business days’ notice to the Agent, at any time by the Agent, or by the mutual agreement of the parties. |
Stock Options and Warrants
Stock Options and Warrants | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Options and Warrants | NOTE 8 — STOCK OPTIONS AND WARRANTS Stock Option Activity The following table sets forth stock option activity under the Company’s stock option plans for the three months ended March 31, 2020 (shares in thousands): Shares Price (1) Term (2) Outstanding, beginning of period 3,551 $ 2.65 8.7 Grants to: Employees 417 1.79 Non-employees 10 1.77 Forfeited (93 ) 3.79 Exercised (2 ) 1.79 Outstanding, end of period 3,883 (3) 2.53 8.6 Vested, end of period 1,415 (3) 2.45 7.3 (1) Represents the weighted average exercise price. (2) Represents the weighted average remaining contractual term until the stock options expire. (3) As of March 31, 2020, the closing price of the Company’s Common Stock was $1.39 per share resulting in no intrinsic value associated with any outstanding stock options. For the three months ended March 31, 2020, the valuation assumptions for stock options granted to employees and non-employees under the Company’s equity incentive plans were estimated on the date of grant using the BSM option-pricing model with the following weighted-average assumptions: Grant date closing price of Common Stock $ 1.79 Expected life (in years) 5.8 Volatility 104 % Dividend yield 0 % Risk-free interest rate 1.2 % Based on the assumptions set forth above, the weighted-average grant date fair value per share for stock options granted for the three months ended March 31, 2020 and 2019 was $1.43 and $4.24, respectively. The BSM model requires various subjective assumptions that represent management’s best estimates of the fair value of the Company’s Common Stock, volatility, risk-free interest rates, expected term, and dividend yield. The expected term represents the weighted-average period that options granted are expected to be outstanding giving consideration to vesting schedules. Because the Company does not have an extended history of actual exercises, the Company has estimated the expected term using a simplified method which calculates the expected term as the average of the time-to-vesting and the contractual life of the awards. The Company has never declared or paid cash dividends and does not plan to pay cash dividends in the foreseeable future; therefore, the Company used an expected dividend yield of zero. The risk-free interest rate is based on U.S. Treasury rates in effect for maturities based on the expected term of the grant. The expected volatility is based on the historical volatility of the Company’s Common Stock for the period beginning in August 2016 when its shares were first publicly traded through the grant date of the respective stock options. Restricted Stock Activity The following table sets forth activity related to grants of restricted stock under the Company’s stock option plans for the three months ended March 31, 2020 (in thousands): Equity-Classified Awards Liability-Classified Awards (1) Number of Unvested Number of Unvested Shares Compensation Shares Compensation Outstanding, December 31, 2019 2,123 $ 4,605 37 $ 67 Shares issued to Board members 339 (2) 600 (2) - - Unvested awards granted to employees with service vesting criteria 206 (3) 365 (3) - - Forfeitures (2 ) (9 ) - - Fair value adjustments and other - (75 ) (1 ) (17 ) (1) Vested shares and expense (203 ) (4) (726 ) (4) - (4) (6 ) (4) Outstanding, March 31, 2020 2,463 $ 4,760 36 $ 44 Intrinsic value, March 31, 2020 $ 3,424 (5) $ 51 (5) (1) Certain awards granted to employees in China are not permitted to be settled in shares, which requires classification as a liability in the Company’s condensed consolidated balance sheets. This liability is adjusted based on the closing price of the Company’s Common Stock at the end of each reporting period until these awards vest. As of March 31, 2020 and December 31, 2019, the cumulative amount of compensation expense recognized is based on the progress toward vesting and the total fair value of the respective awards on those dates. (2) Represents grants to members of the Board of Directors whereby the shares of Common Stock will be issued upon vesting, which occurs one year after the grant date. The fair value of the shares was recorded based on the closing price for the Company’s Common Stock of $1.77 per share on the grant date. (3) Represents restricted stock awards that generally vest over three years with fair value determined based on the closing price of the Company’s Common Stock on the respective grant dates. (4) The “Number of Shares” column reflects shares that vested due to achievement of service conditions during the three months ended March 31, 2020. The “Unvested Compensation” column reflects the stock-based compensation expense recognized for both vested and unvested awards during the period. (5) The intrinsic value is based on the closing price of the Company’s Common Stock of $1.39 per share on March 31, 2020. Stock-Based Compensation Expense Substantially all stock-based compensation expense is included in general and administrative expenses in the accompanying condensed consolidated statements of operations. The table below summarizes stock-based compensation expense related to stock options and restricted stock awards for the three months ended March 31, 2020 and 2019, and the unrecognized compensation expense as of March 31, 2020 and 2019 (in thousands): Expense Recognized For Unrecognized Expense Three Months Ended March 31, as of March 31: 2020 2019 2020 2019 Plan-based stock options awards $ 625 $ 1,315 $ 4,515 $ 4,309 Plan-based restricted stock awards: Equity-classified 726 1,353 4,760 3,213 Liability-classified 6 565 44 1,920 Non-plan equity-classified restricted stock awards - 54 - 10 Total $ 1,357 $ 3,287 $ 9,319 $ 9,452 As of March 31, 2020, unrecognized stock-based compensation expense is expected to be recognized on a straight-line basis over a weighted-average period of approximately 2.2 years for stock options, 2.0 years for equity-classified restricted stock awards, and 1.8 years for liability-classified restricted stock awards. Warrants As of March 31, 2020 and 2019, the Company had warrants outstanding for 0.3 million and 0.1 million shares of Common Stock, respectively. For the three months ended March 31, 2020 and 2019, no warrants were granted, exercised or expired. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 9 — INCOME TAXES The Company’s provision for income taxes for the three months ended March 31, 2020 and 2019 resulted in income tax expense of $0.7 million and an income tax benefit of $1.7 million, respectively. The effective tax rate as a percentage of pre-tax losses for the three months ended March 31, 2020 and 2019 was negative 7% and 51%, respectively, compared to the U.S. federal statutory rate of 21%. The negative effective tax rate for the three months ended March 31, 2020 was primarily due to foreign income tax expense on profitable foreign operations and the impact of the domestic valuation allowance offsetting domestic income tax benefits. The difference between the effective tax rate for the first quarter of 2019 and the U.S. federal statutory rate was primarily attributable to losses of foreign subsidiaries. Interim income taxes are based on an estimated annualized effective tax rate applied to the respective quarterly periods, adjusted for discrete tax items in the period in which they occur. Although the Company believes its tax estimates are reasonable, the Company can make no assurance that the final tax outcome of these matters will not be different from that which it has reflected in its historical income tax provisions and accruals. Such differences could have a material impact on the Company’s income tax provision and operating results in the period in which the Company makes such determination. The total outstanding balance for liabilities related to unrecognized tax benefits was $1.5 million as of March 31, 2020 and December 31, 2019. The Company does not anticipate that unrecognized tax benefits will significantly increase or decrease within the next twelve months. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | NOTE 10 —CONTINGENCIES Litigation, Claims and Assessments The Company’s operations are subject to numerous governmental rules and regulations in each of the countries it does business. These rules and regulations include a complex array of tax and customs regulations as well as restrictions on product ingredients and claims, the commissions paid to the Company’s independent product consultants (“IPCs”), labeling and packaging of products, conducting business as a direct-selling business, and other facets of manufacturing and selling products. In some instances, the rules and regulations may not be fully defined under the law or are otherwise unclear in their application. Additionally, laws and regulations can change from time to time, as can their interpretation by the courts, administrative bodies, and the tax and customs authorities in each country. The Company actively seeks to be in compliance, in all material respects, with the laws of each of the countries in which it does business and expects its IPCs to do the same. The Company’s operations are often subject to review by local country tax and customs authorities and inquiries from other governmental agencies. No assurance can be given that the Company’s compliance with governmental rules and regulations will not be challenged by the authorities or that such challenges will not result in assessments or required changes in the Company’s business that could have a material impact on its business, consolidated financial statements and cash flow. The Company has various non-income tax contingencies in several countries. Such exposure could be material depending upon the ultimate resolution of each situation. As of March 31, 2020 and December 31, 2019, the Company has recorded a current liability under ASC 450, Contingencies From time to time, the Company may be a party to litigation and subject to claims incident to the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on its business. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors. COVID-19 Pandemic In December 2019, a novel strain of coronavirus known as COVID-19 was reported to have surfaced in China, and by March 2020 the spread of the virus had resulted in a world-wide pandemic. The U.S. economy has been largely shut down by mass quarantines and government mandated stay-in-place orders (the “Orders”) to halt the spread of the virus. These Orders have required some of the Company’s employees to work from home when possible, and other employees have been entirely prevented from performing their job duties until the Orders are relaxed or lifted. These Orders have adversely impacted restaurants, hotels, stadiums and airports in the United States, whereby that line of the Company’s distribution business has been negatively impacted since March 2020. The world-wide response to the pandemic has resulted in a significant downturn in economic activity and there is no assurance that government stimulus programs will successfully restore the economy to the levels that existed before the pandemic. If an economic recession or depression is sustained, it could have a material adverse effect on the Company’s business as consumer demand for its products could decrease. In foreign jurisdictions, which accounted for approximately 70% of the Company’s net revenue for the three months ended March 31, 2020, the impact of the pandemic did not have a significant impact on net revenue through March 31, 2020. While the Company’s direct-to-consumer selling model typically relies heavily on the use of its IPC sales force in close contact with customers, the pandemic has required alternative selling approaches such as through social media. As long as Orders are in place around the world, no assurance can be provided that the Company will be able to avoid future reductions in net revenue using alternative selling approaches that avoid direct contact with customers. In certain jurisdictions, the Orders are beginning to be relaxed but considerable uncertainty remains about the ultimate impact on the Company’s business. Even if the Orders are lifted, there is no assurance that they will not be reinstated if the spread of COVID-19 resumes. While the current disruption to the Company’s business is expected to be temporary, the long-term financial impact on the Company’s business cannot be reasonably estimated at this time. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | NOTE 11 —NET LOSS PER SHARE Net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. The calculation of diluted net loss per share includes dilutive stock options, unvested restricted stock awards, and other Common Stock equivalents computed using the treasury stock method, in order to compute the weighted average number of shares outstanding. For the three months ended March 31, 2020 and 2019, basic and diluted net loss per share were the same since all Common Stock equivalents were anti-dilutive. As of March 31, 2020 and 2019, the following potential Common Stock equivalents were excluded from the computation of diluted net loss per share since the impact of inclusion was anti-dilutive (in thousands): 2020 2019 Equity incentive plan awards: Stock options 3,883 2,759 Unissued and unvested restricted stock awards 2,499 1,227 Common stock purchase warrants 311 103 Total 6,693 4,089 |
Financial Instruments and Signi
Financial Instruments and Significant Concentrations | 3 Months Ended |
Mar. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments and Significant Concentrations | NOTE 12 — FINANCIAL INSTRUMENTS AND SIGNIFICANT CONCENTRATIONS Fair Value Measurements Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. When determining fair value, the Company considers the principal or most advantageous market in which it transacts and considers assumptions that market participants would use when pricing the asset or liability. The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair measurement: Level 1—Quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date Level 2—Other than quoted prices included in Level 1 that are observable for the asset and liability, either directly or indirectly through market collaboration, for substantially the full term of the asset or liability Level 3—Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any market activity for the asset or liability at measurement date As of March 31, 2020 and December 31, 2019, the fair value of the Company’s cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued liabilities approximated their carrying values due to the short-term nature of these instruments. Cash equivalents consist of short-term certificates of deposit that are classified as Level 2. The recorded amounts for the debt obligations in Notes 3 and 7 also approximated fair value due to the short-term maturities, variable nature of the interest rates and/or since the instruments had been recently negotiated. Recurring Fair Value Measurements Recurring measurements of the fair value of assets and liabilities as of March 31, 2020 and December 31, 2019 were as follows: As of March 31, 2020 As of December 31, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Earnout under Series D preferred stock $ - $ - $ 288 $ 288 $ - $ - $ 225 $ 225 Interest rate swap liability - 425 - 425 - 99 - 99 Total $ - $ 425 $ 288 $ 713 $ - $ 99 $ 225 $ 324 Valuation assumptions for the earnout under the Series D preferred stock are set forth in Note 3. The interest rate swap agreement provides for a total notional amount of $10.0 million at a fixed interest rate of approximately 5.4% through May 1, 2023, in exchange for a floating rate indexed to the prime rate plus 0.50%, and is classified within Level 2 of the fair value hierarchy. The Company’s policy is to recognize asset or liability transfers among Level 1, Level 2 and Level 3 as of the actual date of the events or change in circumstances that caused the transfer. During the three months ended March 31, 2020 and 2019, the Company had no transfers of its assets or liabilities between levels of the fair value hierarchy. Significant Concentrations A significant portion of the Noni by NewAge business is conducted in foreign markets, exposing the Company to the risks of trade or foreign exchange restrictions, increased tariffs, foreign currency fluctuations and similar risks associated with foreign operations. For the three months ended March 31, 2020 and 2019, approximately 70% and 72%, respectively, of the Company’s consolidated net revenue was generated outside the United States, primarily in the Asia Pacific market. Most of the Noni by NewAge’s products have a component of the Noni plant, Morinda Citrifolia (“Noni”) as a common element. Tahitian Noni ® Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, restricted cash, and accounts receivable. The Company maintains its cash, cash equivalents and restricted cash at high-quality financial institutions. Cash deposits, including those held in foreign branches of global banks, may exceed the amount of insurance provided on such deposits. As of March 31, 2020, the Company had cash and cash equivalents with two financial institutions in the United States with balances of $13.4 million and $1.4 million, and two financial institutions in China with balances of $8.3 million and $8.0 million. As of December 31, 2019, the Company had cash and cash equivalents with two financial institutions in the United States with balances of $22.2 million and $1.4 million, and two financial institutions in China with balances of $6.6 million and $3.6 million. The Company has never experienced any losses related to its investments in cash, cash equivalents and restricted cash. Generally, credit risk with respect to accounts receivable is diversified due to the number of entities comprising the Company’s customer base and their dispersion across different geographies and industries. The Company performs ongoing credit evaluations on certain customers and generally does not require collateral on accounts receivable. The Company maintains reserves for potential bad debts. |
Segments and Geographic Concent
Segments and Geographic Concentrations | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segments and Geographic Concentrations | NOTE 13 — SEGMENTS AND GEOGRAPHIC CONCENTRATIONS Reportable Segments The Company follows segment reporting in accordance with ASC Topic 280, Segment Reporting The Noni by NewAge segment is engaged in the development, manufacturing, and marketing of Tahitian Noni® Juice, MAX and other noni beverages as well as other nutritional, cosmetic and personal care products. The Noni by NewAge segment has manufacturing operations in Tahiti, Germany, Japan, the United States, and China. The Noni by NewAge segment’s products are sold and distributed in more than 60 countries using IPC’s through its direct to consumer selling network and ecommerce business model. Approximately 80% of the net revenue of the Noni by NewAge segment is generated in the key Asia Pacific markets of Japan, China, Korea, Taiwan, and Indonesia. The NewAge segment markets and sells a portfolio of healthy beverage brands including XingTea, Búcha® Live Kombucha, Coco-Libre, Evian, Nestea, Illy Coffee and Volvic. These products are distributed through the Company’s Direct Store Distribution (“DSD”) network and a hybrid of other routes to market throughout the United States and in a few countries around the world. The NewAge brands are sold in all channels of distribution including hypermarkets, supermarkets, pharmacies, convenience, gas and other outlets. The NewAge segment distributes beverages to retail customers in Colorado and surrounding states, and sells beverages to wholesale distributors, key account owned warehouses and international accounts using several distribution channels. Net revenue by reporting segment for the three months ended March 31, 2020 and 2019, was as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 50,110 $ 48,222 NewAge 13,583 10,085 Net revenue $ 63,693 $ 58,307 Gross profit by reporting segment for the three months ended March 31, 2020 and 2019, was as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 39,606 $ 37,705 NewAge 1,918 871 Total gross profit $ 41,524 $ 38,576 Assets by reporting segment as of March 31, 2020 and December 31, 2019, were as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 186,610 $ 201,600 NewAge 42,618 49,530 Total assets $ 229,228 $ 251,130 Depreciation and amortization expense by reporting segment for the three months ended March 31, 2020 and 2019, was as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 1,719 $ 1,695 NewAge 160 541 Total depreciation and amortization $ 1,879 $ 2,236 Cash payments for capital expenditures for property and equipment and identifiable intangible assets by reporting segment for the three months ended March 31, 2020 and 2019, were as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 1,467 $ 116 NewAge 124 295 Total capital expenditures $ 1,591 $ 411 Geographic Concentrations The Company attributes net revenue to geographic regions based on the location of its customers’ contracting entity. The following table presents net revenue by geographic region for the three months ended March 31, 2020 and 2019 (in thousands): 2020 2019 United States of America $ 19,385 $ 16,455 Japan 20,867 20,700 China 14,975 13,155 Other countries 8,466 7,997 Net revenue $ 63,693 $ 58,307 As of March 31, 2020 and December 31, 2019, the net carrying value of property and equipment located outside of the United States amounted to approximately $22.6 million and $22.1 million, respectively. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 14 — SUBSEQUENT EVENTS ATM Agreement On May 8, 2020, the ATM Agreement discussed in Note 7 was amended and restated to eliminate the previous termination date of April 30, 2020. As amended and restated, the ATM Agreement will terminate (i) when all of the Placement Shares have been sold, (ii) if we elect to terminate upon five business days’ notice to the Agent, (iii) at any time by the Agent, or (iv) by the mutual agreement of the parties. During April 2020 the Company sold an aggregate of approximately 5.3 million shares of Common Stock under the ATM Agreement for net proceeds of approximately $7.4 million. PPP Loan On April 14, 2020, the Company entered into the PPP Loan with EWB in an aggregate principal amount of approximately $6.9 million pursuant to the CARES Act. The PPP Loan bears interest at a fixed rate of 1.0% per annum, with the first six months of interest deferred, has a term of two years, and is unsecured and guaranteed by the U.S. Small Business Administration. The Company may apply to the lender for forgiveness of the PPP Loan, with the amount which may be forgiven equal to the sum of payroll costs, covered rent and mortgage obligations, and covered utility payments incurred by the Company during the eight-week period beginning on April 10, 2020, calculated in accordance with the terms of the CARES Act. To the extent that all or part of the PPP Loan is not forgiven, the Company will be required to pay interest at 1.0%, and commencing in October 2020 principal and interest payments will be required through the maturity date in April 2022.The terms of the PPP Loan provide for customary events of default including, among other things, payment defaults, breach of representations and warranties, and insolvency events. The PPP Loan may be accelerated upon the occurrence of an event of default. Employment Agreements On May 8, 2020, the Company entered into employment agreements with three executive officers that provide for aggregate annual base compensation of $1.7 million plus potential for annual performance bonuses ranging between 50% and 100% of annual base compensation. The agreements expire on January 1, 2023 and provide for annual renewal periods thereafter. If the employment agreements are terminated by the Company before the expiration date, the Company will be required to make severance payments of between 9 and 18 months of base compensation and health insurance benefits, plus the entire performance bonus that would have been otherwise payable for the year in which termination occurs. If termination occurs in connection with a change of control, the Company is required to make (i) severance payments of between 150% and 200% of annual base compensation plus the performance bonus applicable in the year in which termination occurs, and (ii) payments for up to 18 months of health insurance benefits. Restructuring In April 2020, the Company initiated a restructuring plan that is designed to achieve annualized selling, general and administrative cost reductions between $5.0 million and $7.0 million. This restructuring plan is primarily focused on reductions in marketing personnel and consulting resources. No assurance can be provided that the restructuring plan will be successful in achieving the intended cost reductions. |
Basis of Presentation and Sig_2
Basis of Presentation and Signficant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Basis Of Presentation And Signficant Accounting Policies | |
Segments | Segments The Company’s chief operating decision maker (the “CODM”), who is the Company’s Chief Executive Officer, allocates resources and assesses performance based on financial information of the Company. The CODM reviews financial information presented for each reportable segment for purposes of making operating decisions and assessing financial performance. The Company’s CODM assesses performance and allocates resources based on the financial information of two operating segments, the Noni by NewAge segment and the NewAge segment. These two reportable segments focus on the sale of distinctly different beverage products and are managed separately because they have different marketing strategies, customer bases, and economic characteristics. Please refer to Note 13 for additional information about the Company’s operating segments. |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements, which include the accounts of the Company and its wholly-owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All intercompany balances and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, certain information and footnote disclosures required by U.S. GAAP for complete financial statements have been condensed or omitted in accordance with such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. These unaudited condensed consolidated financial statements for the three months ended March 31, 2020 should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended December 31, 2019, included in the Company’s 2019 Annual Report on Form 10-K filed with the SEC on March 16, 2020 and as amended on April 28, 2020 (the “2019 Form 10-K”). The accompanying condensed consolidated balance sheet and related disclosures as of December 31, 2019 have been derived from the Company’s audited financial statements. The Company’s financial condition as of March 31, 2020 and operating results for the three months ended March 31, 2020 are not necessarily indicative of the financial condition and results of operations that may be expected for any future interim period or for the year ending December 31, 2020. |
Use of Estimates | Use of Estimates The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires the Company to make judgments, assumptions, and estimates that affect the amounts reported in its consolidated financial statements and accompanying notes. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes are reasonable under the circumstances, to determine the carrying values of assets and liabilities that are not readily apparent from other sources. The Company’s significant accounting estimates include, but are not necessarily limited to, impairment of goodwill and long-lived assets; valuation assumptions for earnout obligations and assets acquired in business combinations; valuation assumptions for stock options, warrants and equity instruments issued for goods or services; estimated useful lives for identifiable intangible assets and property and equipment; allowances for sales returns, chargebacks and inventory obsolescence; deferred income taxes and the related valuation allowances; and the evaluation and measurement of contingencies. Additionally, the full impact of COVID-19 is unknown and cannot be reasonably estimated. However, the Company has made appropriate accounting estimates based on the facts and circumstances available as of the reporting date. To the extent there are material differences between the Company’s estimates and the actual results, the Company’s future consolidated results of operation will be affected. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Standards. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Codification Improvements to Topic 326, Financial Instruments – Credit Losses. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. Standards Required to be Adopted in Future Years. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. No other recently issued accounting pronouncements are expected to have a material impact on the Company’s consolidated financial statements. |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
OtherInformationDisclosureTextBlock | |
Schedule of Unaudited Pro Forma Disclosures | The following table summarizes on an unaudited pro forma basis, the Company’s results of operations for the three months ended March 31, 2019 giving effect to the BWR business combination as if it had occurred on January 1, 2019 (in thousands, except loss per share amount): Net revenue $ 62,764 Net loss $ (1,685 ) Net loss per share- basic and diluted $ (0.02 ) Weighted average number of shares of common stock outstanding- basic and diluted 75,334 |
Summary of Earnout Obligations | As of March 31, 2020 and December 31, 2019, the following is a summary of purchase consideration payable to the former stockholders of Morinda, and outstanding earnout obligations related to business combinations with Morinda in December 2018 and the Marley Beverage Company (“Marley”) in June 2017 (in thousands): 2020 2019 Payables to former Morinda stockholders: Excess Working Capital (“EWC”) payable in July 2020, net of discount $ 5,360 $ 5,283 Earnout under Series D preferred stock 288 225 Marley earnout obligation - (1) - (1) Total $ 5,648 $ 5,508 (1) The Company was previously obligated to make a one-time earnout payment of $1.25 million over a period of two years beginning at such time that revenue for the Marley reporting unit was equal to or greater than $15.0 million during any trailing twelve calendar month period. As of December 31, 2019, the Company determined that revenue for the Marley reporting unit was not expected to exceed the $15.0 million earnout threshold and, accordingly, there was no fair value related to this liability. The Company terminated its license agreement with Marley as of March 31, 2020 to eliminate this obligation. |
Other Financial Information (Ta
Other Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventories | Inventories consisted of the following as of March 31, 2020 and December 31, 2019 (in thousands): 2020 2019 Raw materials $ 10,035 $ 12,848 Work-in-process 1,665 872 Finished goods, net 21,957 22,998 Total inventories $ 33,657 $ 36,718 |
Schedule of Other Accrued Liabilities | As of March 31, 2020 and December 31, 2019, other accrued liabilities consisted of the following (in thousands): 2020 2019 Accrued commissions $ 8,754 $ 8,914 Accrued compensation and benefits 5,999 5,868 Accrued marketing events 6,660 4,568 Deferred revenue 3,370 1,358 Income taxes payable 3,090 15,227 Current portion of operating lease liabilities 5,724 5,673 Other accrued liabilities 8,363 7,843 Total accrued liabilities $ 41,960 $ 49,451 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Summary of Selling Price and Resulting Gain On Sale | Presented below is a summary of the selling price and resulting gain on sale calculation (in thousands): Gross selling price $ 57,129 Less commissions and other expenses (1,941 ) Less repair obligations (1,675 ) Net selling price 53,513 Cost of land and building sold (29,431 ) Total gain on sale 24,082 Portion of gain related to above-market rent concession (17,640 ) Recognized gain on sale $ 6,442 |
Summary of Future Minimum Lease Payments | As of March 31, 2020, future payments under operating lease agreements are as follows (in thousands): Year Ending December 31, Remainder of 2020 $ 6,436 2021 7,266 2022 5,877 2023 5,389 2024 5,222 Thereafter 28,729 Total operating lease payments 58,919 Less imputed interest (18,060 ) (1) Present value of operating lease payments $ 40,859 (1) Calculated based on the term of the respective leases using discount rates ranging from 2.0% to 10.0%. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Debt | As of March 31, 2020 and December 31, 2019, debt consisted of the following (in thousands): 2020 2019 EWB Credit Facility: Term loan, net of discount of $637 and $448 as of March 31, 2020 and December 31, 2019, respectively $ 13,738 $ 14,302 Revolver - 9,700 Installment notes payable 7 8 Total 13,745 24,010 Less current maturities (1,504 ) (11,208 ) Long-term debt, less current maturities $ 12,241 $ 12,802 |
Summary Future Debt Maturities | As of March 31, 2020, the scheduled future maturities of long-term debt, exclusive of discount accretion, are as follows: Year Ending December 31, Remainder of 2020 $ 1,129 2021 1,503 2022 1,500 2023 10,250 Total $ 14,382 |
Stock Options and Warrants (Tab
Stock Options and Warrants (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity | The following table sets forth stock option activity under the Company’s stock option plans for the three months ended March 31, 2020 (shares in thousands): Shares Price (1) Term (2) Outstanding, beginning of period 3,551 $ 2.65 8.7 Grants to: Employees 417 1.79 Non-employees 10 1.77 Forfeited (93 ) 3.79 Exercised (2 ) 1.79 Outstanding, end of period 3,883 (3) 2.53 8.6 Vested, end of period 1,415 (3) 2.45 7.3 (1) Represents the weighted average exercise price. (2) Represents the weighted average remaining contractual term until the stock options expire. (3) As of March 31, 2020, the closing price of the Company’s Common Stock was $1.39 per share resulting in no intrinsic value associated with any outstanding stock options. |
Summary of Stock Options Weighted-average Assumptions | For the three months ended March 31, 2020, the valuation assumptions for stock options granted to employees and non-employees under the Company’s equity incentive plans were estimated on the date of grant using the BSM option-pricing model with the following weighted-average assumptions: Grant date closing price of Common Stock $ 1.79 Expected life (in years) 5.8 Volatility 104 % Dividend yield 0 % Risk-free interest rate 1.2 % |
Schedule of Restricted Stock Award Activity | The following table sets forth activity related to grants of restricted stock under the Company’s stock option plans for the three months ended March 31, 2020 (in thousands): Equity-Classified Awards Liability-Classified Awards (1) Number of Unvested Number of Unvested Shares Compensation Shares Compensation Outstanding, December 31, 2019 2,123 $ 4,605 37 $ 67 Shares issued to Board members 339 (2) 600 (2) - - Unvested awards granted to employees with service vesting criteria 206 (3) 365 (3) - - Forfeitures (2 ) (9 ) - - Fair value adjustments and other - (75 ) (1 ) (17 ) (1) Vested shares and expense (203 ) (4) (726 ) (4) - (4) (6 ) (4) Outstanding, March 31, 2020 2,463 $ 4,760 36 $ 44 Intrinsic value, March 31, 2020 $ 3,424 (5) $ 51 (5) (1) Certain awards granted to employees in China are not permitted to be settled in shares, which requires classification as a liability in the Company’s condensed consolidated balance sheets. This liability is adjusted based on the closing price of the Company’s Common Stock at the end of each reporting period until these awards vest. As of March 31, 2020 and December 31, 2019, the cumulative amount of compensation expense recognized is based on the progress toward vesting and the total fair value of the respective awards on those dates. (2) Represents grants to members of the Board of Directors whereby the shares of Common Stock will be issued upon vesting, which occurs one year after the grant date. The fair value of the shares was recorded based on the closing price for the Company’s Common Stock of $1.77 per share on the grant date. (3) Represents restricted stock awards that generally vest over three years with fair value determined based on the closing price of the Company’s Common Stock on the respective grant dates. (4) The “Number of Shares” column reflects shares that vested due to achievement of service conditions during the three months ended March 31, 2020. The “Unvested Compensation” column reflects the stock-based compensation expense recognized for both vested and unvested awards during the period. (5) The intrinsic value is based on the closing price of the Company’s Common Stock of $1.39 per share on March 31, 2020. |
Schedule of Stock-based Compensation Expense | The table below summarizes stock-based compensation expense related to stock options and restricted stock awards for the three months ended March 31, 2020 and 2019, and the unrecognized compensation expense as of March 31, 2020 and 2019 (in thousands): Expense Recognized For Unrecognized Expense Three Months Ended March 31, as of March 31: 2020 2019 2020 2019 Plan-based stock options awards $ 625 $ 1,315 $ 4,515 $ 4,309 Plan-based restricted stock awards: Equity-classified 726 1,353 4,760 3,213 Liability-classified 6 565 44 1,920 Non-plan equity-classified restricted stock awards - 54 - 10 Total $ 1,357 $ 3,287 $ 9,319 $ 9,452 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Loss Per Share | As of March 31, 2020 and 2019, the following potential Common Stock equivalents were excluded from the computation of diluted net loss per share since the impact of inclusion was anti-dilutive (in thousands): 2020 2019 Equity incentive plan awards: Stock options 3,883 2,759 Unissued and unvested restricted stock awards 2,499 1,227 Common stock purchase warrants 311 103 Total 6,693 4,089 |
Financial Instruments and Sig_2
Financial Instruments and Significant Concentrations (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Schedule of Fair Value of Assets and Liabilities | Recurring measurements of the fair value of assets and liabilities as of March 31, 2020 and December 31, 2019 were as follows: As of March 31, 2020 As of December 31, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Earnout under Series D preferred stock $ - $ - $ 288 $ 288 $ - $ - $ 225 $ 225 Interest rate swap liability - 425 - 425 - 99 - 99 Total $ - $ 425 $ 288 $ 713 $ - $ 99 $ 225 $ 324 |
Segments and Geographic Informa
Segments and Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Summary of Segment Reporting | Net revenue by reporting segment for the three months ended March 31, 2020 and 2019, was as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 50,110 $ 48,222 NewAge 13,583 10,085 Net revenue $ 63,693 $ 58,307 Gross profit by reporting segment for the three months ended March 31, 2020 and 2019, was as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 39,606 $ 37,705 NewAge 1,918 871 Total gross profit $ 41,524 $ 38,576 Assets by reporting segment as of March 31, 2020 and December 31, 2019, were as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 186,610 $ 201,600 NewAge 42,618 49,530 Total assets $ 229,228 $ 251,130 Depreciation and amortization expense by reporting segment for the three months ended March 31, 2020 and 2019, was as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 1,719 $ 1,695 NewAge 160 541 Total depreciation and amortization $ 1,879 $ 2,236 Cash payments for capital expenditures for property and equipment and identifiable intangible assets by reporting segment for the three months ended March 31, 2020 and 2019, were as follows (in thousands): Segment 2020 2019 Noni by NewAge $ 1,467 $ 116 NewAge 124 295 Total capital expenditures $ 1,591 $ 411 |
Schedule of Net Revenue by Geographic Region | The Company attributes net revenue to geographic regions based on the location of its customers’ contracting entity. The following table presents net revenue by geographic region for the three months ended March 31, 2020 and 2019 (in thousands): 2020 2019 United States of America $ 19,385 $ 16,455 Japan 20,867 20,700 China 14,975 13,155 Other countries 8,466 7,997 Net revenue $ 63,693 $ 58,307 |
Basis of Presentation and Sig_3
Basis of Presentation and Signficant Accounting Policies (Details Narrative) | 3 Months Ended |
Mar. 31, 2020ft² | |
Accounting Policies [Abstract] | |
Number of segments | 2 |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details Narrative) - USD ($) $ in Thousands | May 08, 2020 | Apr. 30, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Apr. 14, 2020 | Dec. 31, 2019 |
Accumulated deficit | $ (124,089) | $ (112,471) | ||||
Net loss | (11,618) | $ (1,616) | ||||
Net cash used in operating activities | (13,521) | (6,201) | ||||
Payment of tax related to leaseback | 13,100 | |||||
Proceeds from issuance of common stock | 8,288 | |||||
Cash and cash equivalents | 27,537 | 109,956 | 60,842 | |||
Working capital | 17,000 | |||||
Net proceed from common stock | 8,288 | |||||
Selling, general and administrative | 30,608 | $ 26,842 | ||||
Notes payable | 13,745 | $ 24,010 | ||||
Paycheck Protection Program ATM Agreement [Member] | ||||||
Proceeds from issuance of debt | 6,900 | |||||
Subsequent Event [Member] | ||||||
Selling, general and administrative | $ 5,000 | |||||
Subsequent Event [Member] | Paycheck Protection Program [Member] | ||||||
Notes payable | $ 6,900 | |||||
Subsequent Event [Member] | Paycheck Protection Program [Member] | EWB RevolverMember | ||||||
Debt instrument, face amount | $ 6,900 | |||||
Subsequent Event [Member] | ATM Offering Agreement [Member] | ||||||
Proceeds from issuance of common stock | $ 7,400 | |||||
Sale of common stock | 5,300,000 | |||||
Net proceed from common stock | $ 7,400 | |||||
Subsequent Event [Member] | Restructuring [Member] | ||||||
Selling, general and administrative | $ 7,000 | |||||
EWB Credit Facility [Member] | ||||||
Restricted cash | $ 15,100 |
Business Combinations - (Detail
Business Combinations - (Details Narrative) - USD ($) $ in Thousands | May 07, 2020 | Dec. 02, 2018 | Jul. 31, 2019 | Dec. 31, 2019 |
Milestone Dividend [Member] | ||||
Dividend description | If the Adjusted EBITDA of Morinda was less than $20.0 million, the Milestone Dividend was reduced whereby no Milestone Dividend was payable if actual Adjusted EBITDA was $17.0 million or lower. Adjusted EBITDA of Morinda for the year ended December 31, 2019 was less than $17.0 million and, accordingly, no Milestone Dividend was payable to the holders of the Preferred Stock. | |||
Annual cash dividend payable period | Apr. 15, 2020 | |||
Milestone Dividend [Member] | Subsequent Event [Member] | ||||
Dividend amount | $ 300 | |||
Minimum [Member] | Milestone Dividend [Member] | ||||
Expected EBITDA adjusted dividend amount | $ 20,000 | |||
Morinda Merger Agreement [Member] | Series D Preferred Stock [Member] | ||||
Number of shares issued | 43,804 | |||
Morinda Merger Agreement [Member] | Series D Preferred Stock [Member] | Maximum [Member] | ||||
Payment of potential amount | $ 15,000 | |||
Brands Within Reach, LLC [Member] | ||||
Payments to acquire businesses, gross | $ 1,500 | |||
Business acquisition, shares issued | 107,602 | |||
Business acquisition, shares issued value | $ 453 | |||
Post-acquisition, net revenue | 2,100 | |||
Post-acquisition, net loss | $ 2,300 |
Business Combinations - Schedul
Business Combinations - Schedule of Unaudited Pro Forma Disclosures (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($)$ / sharesshares | |
Business Combinations [Abstract] | |
Net revenue | $ 62,764 |
Net loss | $ (1,685) |
Net loss per share- basic and diluted | $ / shares | $ (0.02) |
Weighted average number of shares of common stock outstanding- basic and diluted | shares | 75,334 |
Business Combinations - Summary
Business Combinations - Summary of Earnout Obligations (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | |
Total | $ 5,648 | $ 5,508 | |
EWC payable in July 2020 [Member] | |||
Total | 5,360 | 5,283 | |
Earnout under Series D Preferred Stock [Member] | |||
Total | 288 | 225 | |
Marley Earnout Obligation [Member] | |||
Total | [1] | ||
[1] | The Company was previously obligated to make a one-time earnout payment of $1.25 million over a period of two years beginning at such time that revenue for the Marley reporting unit was equal to or greater than $15.0 million during any trailing twelve calendar month period. As of December 31, 2019, the Company determined that revenue for the Marley reporting unit was not expected to exceed the $15.0 million earnout threshold and, accordingly, there was no fair value related to this liability. The Company terminated its license agreement with Marley as of March 31, 2020 to eliminate this obligation. |
Business Combinations - Summa_2
Business Combinations - Summary of Earnout Obligations (Details) (Parenthetical) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Business Combinations [Abstract] | |
One time earnout payment | $ 1,250 |
One time earnout payment period | 2 years |
Revenue reporting unit description | The Marley reporting unit was equal to or greater than $15.0 million during any trailing twelve calendar month period. As of December 31, 2019, the Company determined that revenue for the Marley reporting unit was not expected to exceed the $15.0 million earnout threshold and, accordingly, there was no fair value related to this liability. The Company terminated its license agreement with Marley as of March 31, 2020 to eliminate this obligation. |
Other Financial Information (De
Other Financial Information (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Other Information | ||
Depreciation expense | $ 1,000 | $ 900 |
Amortization of intangible assets | $ 900 | $ 1,300 |
Other Financial Information - S
Other Financial Information - Schedule of Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Other Information | ||
Raw materials | $ 10,035 | $ 12,848 |
Work-in-process | 1,665 | 872 |
Finished goods, net | 21,957 | 22,998 |
Total inventories | $ 33,657 | $ 36,718 |
Other Financial Information -_2
Other Financial Information - Schedule of Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Other Information | ||
Accrued commissions | $ 8,754 | $ 8,914 |
Accrued compensation and benefits | 5,999 | 5,868 |
Accured marketing events | 6,660 | 4,568 |
Deferred revenue | 3,370 | 1,358 |
Income taxes payable | 3,090 | 15,227 |
Current portion of operating lease liabilities | 5,724 | 5,673 |
Other accrued liabilities | 8,363 | 7,843 |
Total accrued liabilities | $ 41,960 | $ 49,451 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) $ in Thousands | Mar. 22, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 |
Sale of land | $ 57,100 | |||
Lease term | 27 years | |||
Lease cost | $ 185 | |||
Gain on leaseback arrangement | $ 17,600 | |||
Gain on sale of property | 24,100 | $ 6,442 | ||
Remainder gain on properties | 6,400 | |||
Lease incentive concession amount | $ 17,600 | |||
Weighted average discount lease | 3.50% | |||
Weighted average remaining lease term | 20 years | 12 years 3 months 19 days | 12 years 6 months | |
Right of use asset | $ 38,261 | $ 38,261 | $ 38,458 | |
Operating lease liability | $ 14,300 | $ 40,859 | ||
Operating lease expired | The Company leases various office and warehouse facilities, vehicles and equipment under non-cancellable operating lease agreements that expire between April 2020 and March 2039. The Company has made accounting policy elections (i) to not apply the recognition requirements for short-term leases and (ii) for facility leases, when there are lease and non-lease components, such as common area maintenance charges, to account for the lease and non-lease components as a single lease component. | |||
Operating lease expense | $ 2,500 | $ 2,300 | ||
Japanese Yen [Member] | ||||
Lease cost | $ 20,000 |
Leases - Summary of Selling Pri
Leases - Summary of Selling Price and Resulting Gain On Sale (Details) - USD ($) $ in Thousands | Mar. 22, 2019 | Mar. 31, 2020 |
Leases [Abstract] | ||
Gross selling price | $ 57,129 | |
Less commissions and other expenses | (1,941) | |
Less repair obligations | (1,675) | |
Net selling price | 53,513 | |
Cost of land and building sold | (29,431) | |
Total gain on sale | 24,082 | |
Portion of gain related to above-market rent concession | (17,640) | |
Recognized gain on sale | $ 24,100 | $ 6,442 |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 22, 2019 | |
Leases [Abstract] | |||
Remainder of 2020 | $ 6,436 | ||
2021 | 7,266 | ||
2022 | 5,877 | ||
2023 | 5,389 | ||
2024 | 5,222 | ||
Thereafter | 28,729 | ||
Total minimum lease payments | 58,919 | ||
Less imputed interest | [1] | (18,060) | |
Present value of minimum lease payments | $ 40,859 | $ 14,300 | |
[1] | Calculated based on the term of the respective leases using corporate borrowing rates ranging from 2.0% to 10.0%. |
Leases - Summary of Future Mi_2
Leases - Summary of Future Minimum Lease Payments (Details) (Parenthetical) | Mar. 31, 2020 |
Minimum [Member] | |
Lease corporate borrowing rates | 2.00% |
Maximum [Member] | |
Lease corporate borrowing rates | 10.00% |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) $ in Thousands | Mar. 29, 2019 | Mar. 31, 2020 | Dec. 31, 2019 |
EWB RevolverMember | Prime Rate [Member] | |||
Interest rate percentage | 0.50% | ||
Loan and Security Agreement [Member] | |||
Debt maturity date | Mar. 29, 2023 | ||
Aggregate principal amount | $ 15,000 | ||
Increase amount in principal amount | 25,000 | ||
Revolving loan facility | $ 10,000 | ||
Debt description | (i) a term loan in the aggregate principal amount of $15.0 million, which may be increased to $25.0 million subject to the satisfaction of certain conditions (the "EWB Term Loan") and (ii) a $10.0 million revolving loan facility (the "EWB Revolver"). | ||
Outstanding borrowing credit facility, percentage | 5.75% | ||
Loan and Security Agreement [Member] | Prime Rate [Member] | |||
Interest rate percentage | 5.25% | 4.75% | |
Restricted cash | $ 15,100 | ||
Loan and Security Agreement [Member] | EWB Credit Facility Revolver [Member] | Minimum [Member] | |||
Interest rate percentage | 0.50% | ||
Loan and Security Agreement [Member] | EWB Credit Facility Revolver [Member] | Maximum [Member] | |||
Interest rate percentage | 2.00% | ||
Loan and Security Agreement [Member] | Term Loan [Member] | |||
Monthly principal payments amount | $ 125 | ||
Third Amendment Modified Credit Facility [Member] | EWB RevolverMember | |||
Debt description | The Company was required to make an initial deposit of $15.1 million in restricted cash accounts designated by EWB. The future requirement to maintain restricted cash will be reduced by the amount of future principal payments under the EWB Term Loan. As of March 31, 2020, the Company had made deposits in the restricted cash accounts for the entire $15.1 million. For any future amounts borrowed under the EWB Revolver, the Company is required to increase restricted cash deposits by the corresponding amount of the borrowings. Less stringent requirements are applicable for future compliance with the minimum adjusted EBITDA covenant, the maximum total leverage ratio, and the fixed charge coverage ratio. Additionally, compliance with the maximum total leverage ratio and the fixed charge coverage ratio have been delayed until June 30, 2021. The existing provision related to "equity cures" that may be employed to maintain compliance with financial covenants was increased from $5.0 million to $15.0 million for the year ending December 31, 2020, and to $10.0 million per year for each calendar year thereafter. The Company is required to obtain equity infusions for at least $15.0 million for the first six months of 2020, of which gross proceeds of $8.5 million was received for the three months ended March 31, 2020 as discussed in Note 7, and gross proceeds of $7.6 million were received after March 31, 2020 as discussed in Note 14. Additional equity infusions that result in gross proceeds of $13.9 million must be received by December 31, 2020. | ||
Proceeds from convertible note | 7,600 | ||
Debt issuance cost | $ 200 |
Debt - Summary of Debt (Details
Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Total | $ 13,745 | $ 24,010 |
Less current maturities | (1,504) | (11,208) |
Long-term debt, less current maturities | 12,241 | 12,802 |
EWB Credit Facility Term Loan [Member] | ||
Total | 13,738 | 14,302 |
EWB Credit Facility Revolver [Member] | ||
Total | 9,700 | |
Installment Notes Payable [Member] | ||
Total | $ 7 | $ 8 |
Debt - Summary of Debt (Detai_2
Debt - Summary of Debt (Details) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Notes payable | $ 13,745 | $ 24,010 |
Term Loan [Member] | ||
Notes payable | $ 637 | $ 448 |
Debt - Summary Future Debt Matu
Debt - Summary Future Debt Maturities (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2020 | $ 1,129 |
2021 | 1,503 |
2022 | 1,500 |
2023 | 10,250 |
Total | $ 14,382 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) $ in Thousands | Apr. 30, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 |
Proceeds from issuance of stock | $ 8,288 | |||
Placement Shares [Member] | ATM Offering Agreement [Member] | ||||
Stock issued during the period, value | $ 100,000 | $ 8,500 | $ 29,300 | |
Agreement termination date | Apr. 30, 2020 | |||
Agreement termination, description | ATM Agreement was amended and restated to eliminate the termination date of April 30, 2020. As amended and restated, the ATM Agreement will terminate when all of the Placement Shares have been sold, or earlier by the Company upon five business days' notice to the Agent, at any time by the Agent, or by the mutual agreement of the parties. | |||
Proceeds from issuance of stock | $ 30,000 | |||
Number of shares issued | 4,900 | 10,900 | ||
Commission and fees on sale of shares | $ 200 | |||
Placement Shares [Member] | ATM Offering Agreement [Member] | Gross Proceeds Upto $30 Million [Member] | ||||
Percentage of agent commission equal to gross proceeds | 3.00% | |||
Placement Shares [Member] | ATM Offering Agreement [Member] | Gross Proceeds Exceeds $30 Million [Member] | ||||
Percentage of agent commission equal to gross proceeds | 2.50% |
Stock Options and Warrants (Det
Stock Options and Warrants (Details Narrative) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Warrants outstanding | 300 | 100 |
Stock Options [Member] | ||
Weighted-average grant date fair value | $ 1.43 | $ 4.24 |
Unrecognized stock-based compensation, weighted-average period | 2 years 7 days | |
Equity-Classified Restricted Stock Awards [Member] | ||
Unrecognized stock-based compensation, weighted-average period | 2 years | |
Liability-Classified Restricted Stock Awards [Member] | ||
Unrecognized stock-based compensation, weighted-average period | 1 year 9 months 18 days |
Stock Options and Warrants - Sc
Stock Options and Warrants - Schedule of Stock Option Activity (Details) | 3 Months Ended | |
Mar. 31, 2020$ / sharesshares | ||
Options outstanding, beginning of period | shares | 3,551 | |
Options, forfeited | shares | (93) | |
Options, exercised | shares | (2) | |
Options outstanding, ending of period | shares | 3,883 | [1] |
Options vested, end of period | shares | 1,415 | [1] |
Weighted average grant date fair value outstanding, beginning balance | $ / shares | $ 2.65 | [2] |
Weighted average grant date fair value, forfeited | $ / shares | 3.79 | [2] |
Weighted average grant date fair value, exercised | $ / shares | 1.79 | [2] |
Weighted average grant date fair value outstanding, ending balance | $ / shares | 2.53 | [2] |
Weighted average grant date fair value vested, end of period | $ / shares | $ 2.45 | [2] |
Weighted average remaining contractual term, beginning balance | 8 years 8 months 12 days | [3] |
Weighted average remaining contractual term, ending balance | 8 years 7 months 6 days | [3] |
Weighted average contractual term vested, end of period | 7 years 3 months 19 days | [3] |
Employees [Member] | ||
Options, granted | shares | 417 | |
Weighted average grant date fair value, granted | $ / shares | $ 1.79 | [2] |
Non-Employees [Member] | ||
Options, granted | shares | 10 | |
Weighted average grant date fair value, granted | $ / shares | $ 1.77 | [2] |
[1] | As of March 31, 2020, the closing price of the Company's Common Stock was $1.39 per share resulting in no intrinsic value associated with any outstanding stock options. | |
[2] | Represents the weighted average exercise price. | |
[3] | Represents the weighted average remaining contractual term until the stock options expire. |
Stock Options and Warrants - _2
Stock Options and Warrants - Schedule of Stock Option Activity (Details) (Parenthetical) | Mar. 31, 2020$ / shares |
Share-based Payment Arrangement [Abstract] | |
Common stock price per share | $ 1.39 |
Stock Options and Warrants - Su
Stock Options and Warrants - Summary of Stock Options Weighted-Average Assumptions (Details) | 3 Months Ended |
Mar. 31, 2020$ / shares | |
Share-based Payment Arrangement [Abstract] | |
Grant date closing price of Common Stock | $ 1.79 |
Expected life (in years) | 5 years 9 months 18 days |
Volatility | 104.00% |
Dividend yield | 0.00% |
Risk-free interest rate | 1.20% |
Stock Options and Warrants - _3
Stock Options and Warrants - Schedule of Restricted Stock Award Activity (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)shares | ||
Equity Incentive Plans Equity Awards [Member] | ||
Number of shares, outstanding, beginning of period | shares | 2,123 | |
Number of shares, shares issued to board members | shares | 339 | [1] |
Number of shares, Unvested awards granted to employees with service vesting criteria | shares | 206 | [2] |
Number of shares,Unvested forfeitures | shares | (2) | |
Number of shares, Fair value adjustment and other | shares | ||
Number of shares, vested shares and expense | shares | (203) | [3] |
Number of shares, outstanding, end of period | shares | 2,463 | |
Number of shares, Intrinsic value, end of period | $ 3,424 | [4] |
Unvested compensation, outstanding, beginning of period | 4,605 | |
Unvested compensation, shares issued to Board members | 600 | [1] |
Unvested compensation, Unvested awards granted to employees with service vesting criteria | 365 | [2] |
Unvested compensation, Forfeitures | (9) | |
Unvested compensation, Fair value adjustments and other | (75) | |
Unvested compensation, vested shares and expense | (726) | [3] |
Unvested compensation, outstanding, end of period | $ 4,760 | [4] |
Equity Incentive Plans Liability-Classified Awards [Member] | ||
Number of shares, outstanding, beginning of period | shares | 37 | [5] |
Number of shares, shares issued to board members | shares | [5] | |
Number of shares, Unvested awards granted to employees with service vesting criteria | shares | [5] | |
Number of shares,Unvested forfeitures | shares | [5] | |
Number of shares, Fair value adjustment and other | shares | (1) | [5] |
Number of shares, vested shares and expense | shares | [3],[5] | |
Number of shares, outstanding, end of period | shares | 36 | [5] |
Number of shares, Intrinsic value, end of period | $ 51 | [5] |
Unvested compensation, outstanding, beginning of period | 67 | [5] |
Unvested compensation, shares issued to Board members | [5] | |
Unvested compensation, Unvested awards granted to employees with service vesting criteria | [5] | |
Unvested compensation, Forfeitures | [5] | |
Unvested compensation, Fair value adjustments and other | (17) | [5] |
Unvested compensation, vested shares and expense | (6) | [3],[5] |
Unvested compensation, outstanding, end of period | $ 44 | [5] |
[1] | Represents grants to members of the Board of Directors whereby the shares of Common Stock will be issued upon vesting, which occurs one year after the grant date. The fair value of the shares was recorded based on the closing price for the Company's Common Stock of $1.77 per share on the grant date. | |
[2] | Represents restricted stock awards that generally vest over three years with fair value determined based on the closing price of the Company's Common Stock on the respective grant dates. | |
[3] | The "Number of Shares" column reflects shares that vested due to achievement of service conditions during the three months ended March 31, 2020. The "Unvested Compensation" column reflects the stock-based compensation expense recognized for both vested and unvested awards during the period. | |
[4] | The intrinsic value is based on the closing price of the Company's Common Stock of $1.39 per share on March 31, 2020. | |
[5] | Certain awards granted to employees in China are not permitted to be settled in shares, which requires classification as a liability in the Company's condensed consolidated balance sheets. This liability is adjusted based on the closing price of the Company's Common Stock at the end of each reporting period until these awards vest. As of March 31, 2020 and December 31, 2019, the cumulative amount of compensation expense recognized is based on the progress toward vesting and the total fair value of the respective awards on those dates. |
Stock Options and Warrants - _4
Stock Options and Warrants - Schedule of Restricted Stock Award Activity (Details) (Parenthetical) | Mar. 31, 2020$ / shares |
Equity Incentive Plans Equity Awards [Member] | |
Closing price of common stock | $ 1.77 |
Equity Incentive Plans Liability-Classified Awards [Member] | |
Closing price of common stock | $ 1.39 |
Stock Options and Warrants - _5
Stock Options and Warrants - Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Stock-based compensation expense | $ 1,357 | $ 3,287 |
Unrecognized compensation expense | 9,319 | 9,452 |
Stock Options Awards [Member] | ||
Stock-based compensation expense | 625 | 1,315 |
Unrecognized compensation expense | 4,515 | 4,309 |
Restricted Stock Awards [Member] | Equity Classified [Member] | ||
Stock-based compensation expense | 726 | 1,353 |
Unrecognized compensation expense | 4,760 | 3,213 |
Restricted Stock Awards [Member] | Liability Classified [Member] | ||
Stock-based compensation expense | 6 | 565 |
Unrecognized compensation expense | 44 | 1,920 |
Restricted Stock Awards [Member] | Non-Plan Equity-Classified [Member] | ||
Stock-based compensation expense | 54 | |
Unrecognized compensation expense | $ 10 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income tax benefit (expense) | $ (723) | $ 1,700 | |
Percentage of pre-tax losses | 7.00% | 51.00% | |
Unrecognized income tax benefits | $ 1,500 | $ 1,500 |
Contingencies (Details Narrativ
Contingencies (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2019 | |
Other commitment description | In foreign jurisdictions, which accounted for approximately 70% of the Company's net revenue for the three months ended March 31, 2020, the impact of the pandemic did not have a significant impact on net revenue through March 31, 2020. | |
ASU 450 [Member] | ||
Current liability under (ASU) 450, contingencies | $ 1,900 | $ 900 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Loss Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive securities excluded from computation of earnings per share | 6,693 | 4,089 |
Stock Options [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 3,883 | 2,759 |
Unissued and Unvested Restricted Stock Awards [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 2,499 | 1,227 |
Common Stock Purchase Warrants [Member] | ||
Antidilutive securities excluded from computation of earnings per share | 311 | 103 |
Financial Instruments and Sig_3
Financial Instruments and Significant Concentrations (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Notional amount | $ 10,000 | ||
Valuation assumptions description | Valuation assumptions for the earnout under the Series D preferred stock are set forth in Note 3. The interest rate swap agreement provides for a total notional amount of $10.0 million at a fixed interest rate of approximately 5.4% through May 1, 2023, in exchange for a floating rate indexed to the prime rate plus 0.50%, and is classified within Level 2 of the fair value hierarchy. The Company's policy is to recognize asset or liability transfers among Level 1, Level 2 and Level 3 as of the actual date of the events or change in circumstances that caused the transfer. During the three months ended March 31, 2020 and 2019, the Company had no transfers of its assets or liabilities between levels of the fair value hierarchy. | ||
Concentration risk, percentage | 80.00% | ||
Cash and cash equivalents | $ 27,537 | $ 109,956 | $ 60,842 |
No Single Supplier [Member] | |||
Concentration risk, percentage | 10.00% | ||
One Customer [Member] | |||
Concentration risk, percentage | 10.00% | 10.00% | |
United States [Member] | |||
Concentration risk, percentage | 72.00% | 74.00% | |
United States [Member] | Financial Institution One [Member] | |||
Cash and cash equivalents | $ 13,400 | 22,200 | |
United States [Member] | Financial Institution Two [Member] | |||
Cash and cash equivalents | 1,400 | 1,400 | |
China [Mmeber] | Financial Institution One [Member] | |||
Cash and cash equivalents | 8,300 | 6,600 | |
China [Mmeber] | Financial Institution Two [Member] | |||
Cash and cash equivalents | $ 8,000 | $ 3,600 |
Financial Instruments and Sig_4
Financial Instruments and Significant Concentrations - Schedule of Fair Value of Assets and Liabilities (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Earnout under Series D preferred stock | $ 288 | $ 225 |
Interest rate swap liability | 425 | 99 |
Total | 713 | 324 |
Level 1 [Member] | ||
Earnout under Series D preferred stock | ||
Interest rate swap liability | ||
Total | ||
Level 2 [Member] | ||
Earnout under Series D preferred stock | ||
Interest rate swap liability | 425 | 99 |
Total | 425 | 99 |
Level 3 [Member] | ||
Earnout under Series D preferred stock | 288 | 225 |
Interest rate swap liability | ||
Total | $ 288 | $ 225 |
Segments and Geographic Conce_2
Segments and Geographic Concentrations (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Concentration risk, percentage | 80.00% | ||
Property and equipment, net carrying value | $ 28,716 | $ 28,443 | |
United States [Member] | |||
Concentration risk, percentage | 72.00% | 74.00% | |
Property and equipment, net carrying value | $ 22,600 | $ 22,100 |
Segments and Geographic Conce_3
Segments and Geographic Concentrations - Summary of Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Net revenue | $ 63,693 | $ 58,307 | |
Total gross profit | 41,524 | 38,576 | |
Total assets | 229,228 | $ 251,130 | |
Total depreciation and amortization | 1,879 | 2,236 | |
Total capital expenditures | 1,591 | 411 | |
Noni by NewAge [Member] | |||
Net revenue | 50,110 | 48,222 | |
Total gross profit | 39,606 | 37,705 | |
Total assets | 186,610 | 201,600 | |
Total depreciation and amortization | 1,719 | 1,695 | |
Total capital expenditures | 1,467 | 116 | |
NewAge [Member] | |||
Net revenue | 13,583 | 10,085 | |
Total gross profit | 1,918 | 871 | |
Total assets | 42,618 | $ 49,530 | |
Total depreciation and amortization | 160 | 541 | |
Total capital expenditures | $ 124 | $ 295 |
Segments and Geographic Conce_4
Segments and Geographic Concentrations - Schedule of Net Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total revenue | $ 63,693 | $ 58,307 |
United States [Member] | ||
Total revenue | 19,385 | 16,455 |
Japan [Member] | ||
Total revenue | 20,867 | 20,700 |
China [Mmeber] | ||
Total revenue | 14,975 | 13,155 |
Other Countries [Member] | ||
Total revenue | $ 8,466 | $ 7,997 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) $ in Thousands | May 08, 2020 | Apr. 14, 2020 | Apr. 30, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 |
Net proceed from common stock | $ 8,288 | |||||
Notes payable | 13,745 | $ 24,010 | ||||
Selling, general and administrative | $ 30,608 | $ 26,842 | ||||
Subsequent Event [Member] | ||||||
Selling, general and administrative | $ 5,000 | |||||
Subsequent Event [Member] | ATM Offering Agreement [Member] | ||||||
Sale of common stock | $ 5,300,000 | |||||
Net proceed from common stock | 7,400 | |||||
Subsequent Event [Member] | Paycheck Protection Program [Member] | ||||||
Notes payable | $ 6,900 | |||||
Interest rate | 1.00% | |||||
Subsequent Event [Member] | Employment Agreement [Member] | ||||||
Annual base salary | $ 1,700 | |||||
Employee compensation description | On May 8, 2020, the Company entered into employment agreements with three executive officers that provide for aggregate annual base compensation of $1.8 million plus potential for annual performance bonuses ranging between 50% and 100% of annual base compensation. The agreements expire on January 1, 2023 and provide for annual renewal periods thereafter. If the employment agreements are terminated by the Company before the expiration date, the Company will be required to make severance payments of between 9 and 18 months of base compensation and health insurance benefits, plus the entire performance bonus that would have been otherwise payable for the year in which termination occurs. If termination occurs in connection with a change of control, the Company is required to make (i) severance payments of between 150% and 200% of annual base compensation plus the performance bonus applicable in the year in which termination occurs, and (ii) payments for up to 18 months of health insurance benefits. | |||||
Subsequent Event [Member] | Restructuring [Member] | ||||||
Selling, general and administrative | $ 7,000 |