Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 08, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | FRPT | ||
Entity Registrant Name | FRESHPET, INC. | ||
Entity Central Index Key | 1,611,647 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 33,984,757 | ||
Entity Public Float | $ 228 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 3,908,177 | $ 8,029,413 |
Short-term investments | 3,250,000 | |
Accounts receivable, net of allowance for doubtful accounts | 8,886,790 | 7,030,719 |
Inventories, net | 5,402,735 | 6,853,447 |
Prepaid expenses and other current assets | 1,045,651 | 229,631 |
Total Current Assets | 19,243,353 | 25,393,210 |
Property, plant and equipment, net | 101,493,080 | 82,793,007 |
Deposits on equipment | 3,620,444 | 3,243,519 |
Other assets | 2,094,339 | 1,667,838 |
Total Assets | 126,451,216 | 113,097,574 |
CURRENT LIABILITIES: | ||
Accounts payable | 6,884,155 | 6,668,643 |
Accrued expenses | 4,531,139 | 2,274,557 |
Accrued warrants | 253,391 | 204,314 |
Borrowings under Credit Facilities | 7,000,000 | 0 |
Total Current Liabilities | 18,668,685 | 9,147,514 |
Total Liabilities | 18,668,685 | 9,147,514 |
STOCKHOLDERS' EQUITY: | ||
Common stock — voting, $0.001 par value, 200,000,000 shares authorized, 33,961,650 and 33,536,940 issued and outstanding on December 31, 2016 and December 31, 2015, respectively | 33,961 | 33,537 |
Additional paid-in capital | 299,477,706 | 292,484,986 |
Accumulated deficit | (191,729,136) | (188,568,463) |
Total Stockholders' Equity | 107,782,531 | 103,950,060 |
Total Liabilities and Stockholders' Equity | $ 126,451,216 | $ 113,097,574 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 33,961,650 | 33,536,940 |
Common stock, shares outstanding | 33,961,650 | 33,536,940 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
NET SALES | $ 133,053,517 | $ 116,186,372 | $ 86,764,112 |
COST OF GOODS SOLD | 72,682,634 | 61,537,230 | 44,545,637 |
GROSS PROFIT | 60,370,883 | 54,649,142 | 42,218,475 |
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES | 62,585,833 | 58,296,814 | 48,298,791 |
LOSS FROM OPERATIONS | (2,214,950) | (3,647,672) | (6,080,316) |
OTHER INCOME/(EXPENSES): | |||
Other Income/(Expenses), net | (181,850) | 448,943 | (666,169) |
Fees on Debt Guarantee | (25,937,048) | ||
Interest Expense | (698,119) | (454,567) | (4,613,731) |
Other Income/(Expenses), Total | (879,969) | (5,624) | (31,216,948) |
LOSS BEFORE INCOME TAXES | (3,094,919) | (3,653,296) | (37,297,264) |
INCOME TAX EXPENSE | 65,754 | 57,516 | 41,753 |
NET LOSS | (3,160,673) | (3,710,812) | (37,339,017) |
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ (3,160,673) | $ (3,710,812) | $ (131,279,893) |
NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS | |||
-BASIC | $ (0.09) | $ (0.11) | $ (9.63) |
-DILUTED | $ (0.09) | $ (0.11) | $ (9.63) |
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING USED IN COMPUTING NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS | |||
-BASIC | 33,674,416 | 33,497,940 | 13,632,042 |
-DILUTED | 33,674,416 | 33,497,940 | 13,632,042 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) - USD ($) | Total | Series B Preferred Stock | Series C Preferred Stock | Common Stock—Voting | Common Stock—VotingSeries C Preferred Stock | Additional Paid-in Capital | Additional Paid-in CapitalSeries B Preferred Stock | Additional Paid-in CapitalSeries C Preferred Stock | Accumulated Deficit |
BALANCES at Dec. 31, 2013 | $ (131,058,038) | $ 10,421 | $ 16,450,175 | $ (147,518,634) | |||||
Shares, Outstanding at Dec. 31, 2013 | 10,421,419 | ||||||||
Share-based compensation expense | 1,553,985 | 1,553,985 | |||||||
Issuance of common stock to consultant for services | 9,991 | $ 1 | 9,990 | ||||||
Issuance of common stock to consultant for services, shares | 666 | ||||||||
Preferred Stock dividend accretion | $ (4,271,550) | $ (7,014,643) | $ (4,271,550) | $ (7,014,643) | |||||
Additional loss upon conversion of Series C Preferred Stock into common stock | (82,654,683) | (82,654,683) | |||||||
Shares issued upon consummation of Initial Public Offering (IPO) | 164,405,679 | $ 11,979 | 164,393,700 | ||||||
Shares issued upon consummation of Initial Public Offering (IPO), shares | 11,979,167 | ||||||||
Conversion of Preferred Series C into common stock upon consummation of IPO | $ 199,760,975 | $ 11,067 | $ 199,749,908 | ||||||
Conversion of Preferred Series C into common stock upon consummation of IPO, shares | 11,067,090 | ||||||||
Net loss | (37,339,017) | (37,339,017) | |||||||
BALANCES at Dec. 31, 2014 | 103,392,699 | $ 33,468 | 288,216,882 | (184,857,651) | |||||
Shares, Outstanding at Dec. 31, 2014 | 33,468,342 | ||||||||
Exercise of options to purchase common stock | 291,749 | $ 44 | 291,705 | ||||||
Exercise of options to purchase common stock, shares | 44,432 | ||||||||
Issuance of restricted stock units | $ 24 | (24) | |||||||
Issuance of restricted stock units, shares | 24,166 | ||||||||
Share-based compensation expense | 3,976,423 | 3,976,423 | |||||||
Net loss | (3,710,812) | (3,710,812) | |||||||
BALANCES at Dec. 31, 2015 | 103,950,060 | $ 33,537 | 292,484,986 | (188,568,463) | |||||
Shares, Outstanding at Dec. 31, 2015 | 33,536,940 | ||||||||
Exercise of options to purchase common stock | 2,767,995 | $ 425 | 2,767,570 | ||||||
Exercise of options to purchase common stock, shares | 424,710 | ||||||||
Share-based compensation expense | 4,225,149 | 4,225,149 | |||||||
Net loss | (3,160,673) | (3,160,673) | |||||||
BALANCES at Dec. 31, 2016 | $ 107,782,531 | $ 33,961 | $ 299,477,706 | $ (191,729,136) | |||||
Shares, Outstanding at Dec. 31, 2016 | 33,961,650 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (3,160,673) | $ (3,710,812) | $ (37,339,017) |
Adjustments to reconcile net loss to net cash flows provided by operating activities: | |||
Provision for (gain)/loss on accounts receivable | (5,164) | 11,985 | 8,092 |
Loss on disposal of equipment and deposits on equipment | 189,531 | 93,599 | 308,707 |
Fees on debt guarantee | 25,937,048 | ||
Share-based compensation | 4,193,490 | 3,923,857 | 1,563,976 |
Fair value adjustment for outstanding warrants | 49,077 | (502,626) | 337,376 |
Change in reserve for inventory obsolescence | (117,944) | (105,022) | (112,835) |
Depreciation and amortization | 9,887,168 | 7,573,535 | 6,424,813 |
Amortization of deferred financing costs and loan discount | 150,272 | 144,823 | 916,322 |
Changes in operating assets and liabilities | |||
Accounts receivable | (1,850,907) | (1,682,304) | (1,870,896) |
Inventories | 1,568,656 | 565,726 | (1,689,091) |
Prepaid expenses and other current assets | (816,020) | 1,061,748 | (1,101,899) |
Other assets | (398,059) | (198,902) | (72,660) |
Accounts payable | 853,854 | 192,583 | (1,608,213) |
Accrued expenses | 2,256,582 | (629,373) | 271,975 |
Net cash flows provided by (used in) operating activities | 12,799,863 | 6,738,817 | (8,026,302) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchases of short-term investments | (7,499,205) | ||
Proceeds from maturities of short-term investments | 3,250,000 | 4,249,205 | |
Acquisitions of property, plant and equipment, software and deposits on equipment | (29,952,536) | (27,015,112) | (17,130,947) |
Acquisitions of land and building | (5,026,250) | ||
Proceeds from sale of equipment | 13,442 | 30,957 | 253,510 |
Net cash flows used in investing activities | (26,689,094) | (35,260,405) | (16,877,437) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Borrowings on long-term debt | 11,500,000 | ||
Repayment of long-term debt | (88,000,000) | ||
Exercise of options to purchase common stock | 2,767,995 | 291,749 | |
Proceeds from borrowings under Credit Facilities | 10,000,000 | ||
Repayment of borrowings under Credit Facilities | (3,000,000) | ||
Proceeds from preferred stock - Series C issued | 6,550,984 | ||
Redemption of Series B preferred stock | (34,998,957) | ||
Financing fees paid in connection with borrowings | (739,469) | ||
Proceeds from shares of common stock issued in initial public offering, net of issuance costs | 164,405,679 | ||
Net cash flows provided by financing activities | 9,767,995 | 291,749 | 58,718,237 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (4,121,236) | (28,229,839) | 33,814,498 |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 8,029,413 | 36,259,252 | 2,444,754 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 3,908,177 | 8,029,413 | 36,259,252 |
SUPPLEMENTAL CASH FLOW INFORMATION: | |||
Taxes paid | 76,945 | 56,353 | 31,365 |
Interest paid | 445,277 | 332,244 | 4,702,333 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||
Preferred stock dividend accretion of Series C and Series B Preferred Stock and additional loss upon conversion of Series C Preferred Stock into common stock upon consummation of IPO | 93,940,876 | ||
Property, plant and equipment purchases in accounts payable | $ 1,404,550 | $ 2,036,114 | $ 983,959 |
Nature of the Business and Summ
Nature of the Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Nature of the Business and Summary of Significant Accounting Policies | Note 1 – Nature of the Business and Summary of Significant Accounting Policies: Nature of the Business – Freshpet, Inc. (hereafter referred to as “Freshpet” or the “Company”), a Delaware corporation, manufactures and markets natural fresh, refrigerated meals and treats for dogs and cats. The Company’s products are distributed throughout the United States, Canada and an international test market into major retail classes including Grocery and Mass (which includes club) as well as Pet specialty and Natural retail. Principles of Consolidation – The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”). The financial statements include the accounts of the Company as well as the Company’s wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Segments – The Company operates as a single operating segment reporting to its chief operating decision maker. Estimates and Uncertainties – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results, as determined at a later date, could differ from those estimates. Cash and Cash Equivalents – The Company at times considers money market funds and all other highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. Short-Term Investments – The Company at times holds interest-bearing certificates of deposits with financial institutions with maturities ranging from three months to one year. Certificates of deposit are classified as short-term investments and interest is recorded as other expenses, net. Historically, interest income has not been material. The Company will continue to monitor interest income and will disclose separately if significant. Accounts Receivable – The Company records trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on its history of write-offs and collections and current credit conditions. Accounts receivable are written off when management deems them to be uncollectible. Inventories – Inventories are stated at the lower of cost or market, using the first-in, first-out method. When necessary, the Company provides allowances to adjust the carrying value of its inventories to the lower of cost or net realizable value, including any costs to sell or dispose and consideration for obsolescence, excessive inventory levels, product deterioration and other factors in evaluating net realizable value. Property, Plant and Equipment – Property, plant and equipment are recorded at cost. The Company provides for depreciation on the straight-line method by charges to income at rates based upon estimated recovery periods of 7 years for furniture and office equipment, 5 years for automotive equipment, 9 years for refrigeration equipment, 5 to 10 years for machinery and equipment, and 15 to 39 years for building and improvements. Capitalized cost includes the costs incurred to bring the property, plant and equipment to the condition and location necessary for its intended use, which includes any necessary delivery, electrical and installation cost for equipment. Maintenance and repairs that do not extend the useful life of the assets over two years are charged to expense as incurred. Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful lives on the straight-line method. Long-Lived Assets – The Company evaluates all long-lived assets for impairment. Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Recoverability of assets held for sale is measured by a comparison of the carrying amount of an asset or asset group to their fair value less estimated costs to sell. Estimating future cash flows and calculating fair value of assets requires significant estimates and assumptions by management. If the carrying amount is not fully recoverable, an impairment loss is recognized to reduce the carry amount to fair value, and is charged to expense in the period of impairment. Income Taxes – The Company provides for deferred income taxes for temporary differences between financial and income tax reporting, principally net operating loss carryforwards, depreciation, and share-based compensation. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is appropriate when management believes it is more likely than not, the deferred tax asset will not be realized. At December 31, 2016, and 2015, the Company determined that a valuation allowance of 100% is appropriate. Revenue Recognition and Incentives – Revenue from product sales is recognized upon shipment to the customers as terms are free on board (“FOB”) shipping point, at which point title and risk of loss is transferred and the selling price is fixed or determinable. This completes the revenue-earning process specifically that an arrangement exists, delivery has occurred, ownership has transferred, the price is fixed and collectability is reasonably assured. A provision for payment discounts and product return allowances, which is estimated based upon the Company’s historical performance, management’s experience and current economic trends, is recorded as a reduction of sales in the same period that the revenue is recognized. Trade incentives, consisting primarily of customer pricing allowances and merchandising funds, and consumer coupons are offered through various programs to customers and consumers. Sales are recorded net of estimated trade incentive spending, which is recognized as incurred at the time of sale. Accruals for expected payouts under these programs are included as accrued expense in the consolidated balance sheet. Coupon redemption costs are also recognized as reductions of net sales when the coupons are issued. Estimates of trade promotion expense and coupon redemption costs are based upon programs offered, timing of those offers, estimated redemption/usage rates from historical performance, management’s experience and current economic trends. Advertising – Advertising costs are expensed when incurred, with the exception of production costs which are expensed the first time advertising takes place. Advertising costs, consisting primarily of media ads, were $15,374,392, $16,302,237, and $14,231,930, in 2016, 2015, and 2014, respectively. Shipping and Handling Costs/Freight Out – Costs incurred for shipping and handling are included in selling, general, and administrative expenses within the statement of operations and comprehensive loss. Shipping and handling costs primarily consist of costs associated with moving finished products to customers, including costs associated with our distribution center and the cost of shipping products to customers through third-party carriers. Shipping and handling cost totaled $11,202,392, $11,407,908, and $9,447,406 for the years ended December 31, 2016, 2015, and 2014, respectively. Research & development – Research and development costs consist of expenses to develop and test new products. The cost are expensed as incurred. Share-Based Compensation – The Company recognizes share-based compensation based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period. Share-based compensation expense recognized in the statement of operations included compensation expense for share-based payment awards granted subsequent to December 31, 2006, based on the grant date fair value estimated. Share awards are amortized under the straight-line method over the requisite service period of the entire award. Upon the adoption of ASU 2016-09, the Company no longer estimates expected forfeitures but accounts for forfeitures as they occur. The Company determines the fair value of the stock options granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. Fair Value of Financial Instruments – Financial Accounting Standards Board (“FASB”) guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: • Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities. • Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial instruments that are valued using models or other valuation methodologies. • Level 3 – Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable. The carrying amounts reported in the balance sheets for cash and cash equivalents, other receivables, accounts payable and accrued expenses approximate their fair value based on the short-term maturity of these instruments. The warrant liability is recorded at fair value with changes in fair value reflected in the statement of operations and comprehensive loss. As of December 31, 2016, the Company only maintained Level 1 assets and liabilities. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Recently Issued Accounting Standards | Note 2 – Recently Issued Accounting Standards: Adopted In April 2015, the FASB issued ASU 2015-03, “Interest—Imputation of Interest,” which requires that debt issuance cost be presented on the balance sheet as a direct deduction from the carrying amount of debt liability, consistent with debt discounts or premiums. This new guidance was adopted beginning January 1, 2016 and did not impact the Company’s consolidated financial statements other than presentation. In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes,” which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as noncurrent. The new guidance was adopted beginning January 1, 2016. The effects of ASU 2015-17 will change retrospectively how deferred tax assets and liabilities are classified within the balance sheet and notes thereto. Due to the Company’s full valuation allowance, deferred tax assets and liabilities have not been disclosed within the consolidated balance sheet. In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting,” which simplifies several aspects of the accounting for share-based payment transactions including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company elected to early adopt this amendment in the second quarter of 2016. The Company has elected to account for forfeitures when they occur rather than estimating the number of awards that are expected to vest. The impact on the Company’s Consolidated Statements of Operations and Comprehensive Loss was not material. The amendments related to excess tax benefits are not material due to the Company’s net operating losses. Not Yet Adopted In May 2014, the Financing Accounting Standard Board (“FASB”) issued ASU No. 2014-09, “Revenue from Contracts with Customers”, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In connection with this ASU, the FASB also issued ASU No. 2016-10 regarding identification of performance obligations and licensing considerations, ASU No. 2016-12 regarding narrow scope improvements and practical expedients, and ASU No. 2016-08 which clarifies the implementation of guidance on principal versus agent considerations. In August 2015, the FASB deferred the effective date of ASU No. 2014-09 to fiscal years beginning after December 15, 2017, with early adoption permitted only for fiscal years beginning after December 15, 2016. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is currently utilizing a comprehensive approach to assess the impact of this guidance by reviewing current accounting policies to identify the potential impact of the new requirements on its revenue contracts. The Company does not currently expect this guidance to have a material impact on its consolidated financial statements and related disclosures. The Company currently expects to adopt the new guidance beginning in the fiscal year ended December 31, 2018 and has not yet selected a transition method. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory,” which requires that an entity carry its inventory at lower of cost or net realizable value (which replaces “lower of cost or market”) if the first-in first-out (“FIFO”) or average cost methods are used. This new guidance is effective for the Company’s fiscal year beginning after December 15, 2016. ASU No. 2015-11 is not expected to have impact upon adoption, but could have an impact in future periods depending upon the future valuation of the Company’s inventory. In February 2016, the FASB issued ASU No. 2016-02, "Leases,” which requires lessees to recognize the assets and liabilities that arise from leases on the balance sheet. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The new guidance is effective for financial statements issued for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The amendments should be applied at the beginning of the earliest period presented using a modified retrospective approach with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is assessing the impact of ASU No. 2016-02 on its corporate office lease, and upon adoption of this guidance, expects to record the lease on its consolidated balance sheet in accordance with ASU No. 2016-02. In August 2016, FASB issued ASU No. 2016-15, “Statement of Cash Flows”, which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows, such as proceeds from insurance claims. The new guidance is effective for financial statements issued for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The Company accounts for all applicable cash flows in accordance with this guidance and does not expect the standard to have a material impact on its consolidated financial statements and financial statement disclosures. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 3 – Inventories: Inventories are summarized as follows: December 31, 2016 2015 Raw Materials and Work in Process $ 1,568,789 $ 1,493,654 Packaging Components Material 908,771 1,161,814 Finished Goods 3,219,634 4,374,494 5,697,194 7,029,962 Reserve for Obsolete Inventory (294,459 ) (176,515 ) $ 5,402,735 $ 6,853,447 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment | Note 4 – Property, Plant and Equipment: December 31, 2016 2015 Refrigeration Equipment $ 62,603,188 $ 55,020,179 Machinery and Equipment 45,953,884 21,324,085 Building, Land, and Improvements 25,114,611 15,205,494 Furniture and Office Equipment 3,941,995 2,287,396 Automotive Equipment 317,615 317,292 Leasehold Improvements 297,681 140,672 Construction in Progress 2,841,035 19,388,195 141,070,009 113,683,313 Less: Accumulated Depreciation and Amortization (39,576,929 ) (30,890,306 ) $ 101,493,080 $ 82,793,007 Depreciation and amortization expense related to property, plant and equipment totaled approximately $9,708,062, $7,433,876 and $6,356,736 for the years ended December 31, 2016, 2015 and 2014, respectively; of which $4,028,022, $2,566,013 and $2,453,883 was recorded in cost of goods sold for 2016, 2015 and 2014, respectively; with the remainder of depreciation and amortization expense being recorded to selling, general and administrative expense. In June 2015, the Company purchased a building and 6.5 acres of land adjacent to the Company’s manufacturing facility in Bethlehem, Pennsylvania. The assets have been recorded in Building, Land and Improvements at a cost of approximately $5.0 million, of which approximately $2.1 million was the value of the land, with the remaining portion representing the value of the building. Due to our continued growth, the Company has undertaken a capital expansion project at its Freshpet Kitchens manufacturing facility to expand the plant capacity and increase distribution. Since 2015, the Company invested approximately $35.2 million in capital expenditures related to this project, with $17.6 million recorded during each of 2016 and 2015. A portion of the new equipment was placed into service in July 2016, with the remaining portion placed into service in October 2016, which resulted in incremental depreciation expense of approximately $1.6 million in the year ended December 31, 2016. In order to fund the expansion, we borrowed $10.0 million under our Credit Facilities and repaid $3.0 million by the end of 2016. We expect to repay the remainder of this indebtedness by the end of 2017. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 5 – Income Taxes: A summary of income taxes as follows: December 31, 2016 2015 2014 Current: Federal $ — $ — $ — State 65,754 57,516 41,753 $ 65,754 $ 57,516 $ 41,753 The provisions for income taxes do not bear a normal relationship to loss before income taxes primarily as a result of the valuation allowance on deferred tax assets. The reconciliation of the statutory federal income tax rate to the Company’s effective tax is presented below: December 31, 2016 2015 2014 Tax at federal statutory rate 34.00 % 34.00 % 34.00 % State taxes, net of federal 1.95 0.95 0.13 Permanent items (3.19 ) (1.33 ) (18.40 ) Other 0.54 (0.09 ) (1.58) Valuation allowance (35.43 ) (35.11 ) (14.26 ) Effective tax rate (2.13) % (1.58 )% (0.11 )% The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows: In assessing the realizability of the net deferred tax assets, the Company considers all relevant positive and negative evidence to determine whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The realization of the gross deferred tax assets is dependent on several factors, including the generation of sufficient taxable income prior to the expiration of the net operating loss carryforwards. The Company believes that it is more likely than not that the Company’s deferred income tax assets will not be realized. The Company has experienced taxable losses from inception. As such, there is a full valuation allowance against the net deferred tax assets as of December 31, 2016 and 2015. December 31, 2016 2015 Net deferred tax asset carryforward $ 59,491,094 $ 58,386,785 Stock option expense 3,155,006 2,745,796 Property and equipment (10,400,982 ) (7,687,008 ) Other 981,050 613,190 Less: Valuation allowance (53,226,168 ) (54,058,763 ) Net deferred tax $ — $ — At December 31, 2016, the Company had federal net operating loss (“NOL”) carryforwards of $160,728,383, which expire between 2025 and 2036. The Company may be subject to the net operating loss utilization provisions of Section 382 of the Internal Revenue Code. The effect of an ownership change would be the imposition of an annual limitation on the use of NOL carry forwards attributable to periods before the change. The amount of the annual limitation depends upon the value of the Company immediately before the change, changes to the Company’s capital during a specified period prior to the change, and the federal published interest rate. Although we have not completed an analysis under Section 382 of the Code, it is likely that the utilization of the NOLs will be limited. At December 31, 2016, the Company had $132,394,673 of State NOLs which expire between 2016 and 2036. Entities are also required to evaluate, measure, recognize and disclose any uncertain income tax provisions taken on their income tax returns. The Company has analyzed its tax positions and has concluded that as of December 31, 2016, there were, no uncertain positions. Net deferred tax assets and liabilities are summarized as follows: December 31, 2016 2015 Total deferred tax assets $ 63,627,150 $ 61,745,771 Total deferred tax liabilities (10,400,982 ) (7,687,008 ) Valuation allowance (53,226,168 ) (54,058,763 ) Net deferred income tax assets $ — $ — |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2016 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | Note 6 – Accrued Expenses: December 31, 2016 2015 Accrued Compensation $ 1,895,443 $ 451,819 Accrued Leadership Transition Expense (1) 428,150 — Accrued Chiller Cost 1,010,018 559,957 Accrued Freight 359,009 337,233 Accrued Marketing 211,184 231,353 Accrued Insurance — 218,134 Accrued Sales and Use Tax 45,886 45,886 Other Accrued Expenses 581,449 430,175 $ 4,531,139 $ 2,274,557 (1) Accrued Leadership Transition Costs represent unpaid costs detailed within our former Chief Executive Officer’s separation agreement. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Note 7 – Debt: On November 13, 2014, the Company entered into senior secured credit facilities (the “Debt Refinancing”) comprised of a 5-year $18.0 million term facility (the “Term Facility”), a 3-year $10.0 million revolving facility (the “Revolving Facility”) and a $12.0 million additional term loan commitment earmarked primarily for capital expenditures (the “Capex Commitments” and together with the Term Facility and Revolving Facility, the “Credit Facilities” and such loan agreement, the “Loan Agreement”). On December 23, 2014, the Company modified the terms of the $40.0 million Credit Facilities. The $18.0 million Term Facility was repaid and extinguished, the 3-year $10.0 million Revolving Facility remained unchanged, and the $12.0 million Capex Commitments was increased to $30.0 million. Amounts borrowed under the Capex Commitments reduce the $30.0 million available such that the borrowed funds are no longer available after repayment. Any drawn Capex Commitments will mature on the fifth anniversary of the execution of the Loan Agreement, and undrawn Capex Commitments will expire on the third anniversary of the execution of the Loan Agreement. Under the terms of the Loan Agreement, the commitments for the $10.0 million Revolving Facility may be increased up to $20.0 million subject to certain conditions. Any borrowings under the Credit Facilities bear interest at variable rates depending on our election, either at a base rate or at LIBOR, in each case, plus an applicable margin. The initial applicable margin is 3.75% for base rate loans and 4.75% for LIBOR loans. Thereafter, subject to our leverage ratio, the applicable base rate margin will vary from 2.75% and 3.75% and the applicable LIBOR rate margin will vary from 3.75% and 4.75%. The Credit Facilities are secured by substantially all of our assets. The Loan Agreement provides for the maintenance of various covenants, including financial covenants. The Loan Agreement includes events of default that are usual for facilities and transactions of this type. During the year ended December 31, 2016, the Company borrowed $10.0 million and repaid $3.0 million from the Capex Commitments, and had $30.0 million available under the Credit Facilities as of December 31, 2016. The Company was in compliance with all covenants in the Loan Agreement and had $7.0 million outstanding under the Credit Facilities as of December 31, 2016. There was no outstanding debt as of December 31, 2015. There was less than $0.1 million of accrued interest as of December 31, 2016 and no accrued interest as of December 31, 2015. Interest expense and fees totaled $0.7 million, $0.5 million, and $4.6 million for the years ended December 31, 2016, 2015, and 2014, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 8 – Commitments and Contingencies: Commitments – The Company leases office space under non-cancelable operating leases that expire at various dates through June 30, 2024. As of December 31, 2016, future minimum rentals due under these leases for the next five years were as follows: December 31, 2017 78,219 2018 468,465 2019 478,667 2020 488,870 2021 499,072 2022 and thereafter 1,293,167 $ 3,306,460 Rent expense related to these non-cancelable operating leases was $473,853, $393,718, and $404,438 for the years ended December 31, 2016, 2015, and 2014, respectively. Certain of the Company’s executives are covered by employment contracts requiring the Company to pay severance in the event of certain terminations. Contingency – In November 2015, Freshpet entered into an incentive agreement with a vendor. Under the terms of the agreement, a cash incentive will be earned by the vendor upon achievement of certain performance goals that must be reached by the end of the contract term, which expires on November 30, 2017. The incentive payout is based on the fair value of the Company’s common stock price as of the achievement date specified within the contract. As of December 31, 2016, the Company does not believe it is probable that the vendor will reach the performance goals during the term of the contract and accordingly has not provided an accrual for this agreement. However, if the performance goal were deemed probable as of December 31, 2016, the Company would have established an accrual ranging from $305,000 to $1,015,000, depending on the goal achieved. |
Redeemable Preferred Stock
Redeemable Preferred Stock | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable Preferred Stock | Note 9 – Redeemable Preferred Stock: Immediately following the closing of the IPO on November 13, 2014, the Company redeemed all the outstanding shares of Series B Preferred Stock (“Series B”), including cumulative dividends, for a cash payment of $34,998,957. Additionally, immediately prior to the closing of the IPO, the Company converted the outstanding shares of Series C Preferred Stock (“Series C”) to 11,067,090 shares of common stock. Based on the Series C anti-dilutive clause, the conversion from Series C to common stock was to be equivalent to the 1-to-0.7396 common stock share split that occurred during 2014 in connection with the IPO. The converted Series C included 2,477,756 Series C related to the Fees on Debt Guarantee, which were converted to 1,832,531 shares of common stock. See Note 11 for further detail. Dividends Holders of Series B were entitled to receive dividends payable in additional fully paid and non-assessable shares of Series B at a rate per annum of 15% of the original issue price. Such dividends were to be fully cumulative from the first day of issuance and accrued without interest on both the initial Series B shares obtained and shares obtained via dividend, on a quarterly basis. The dividend accrued during the year ended December 31, 2014 was $4,271,550. The total cumulative dividends that were paid on November 13, 2014, upon redemption of the Series B, was $23,840,008. Holders of Series C were entitled to dividends at a rate of 8% per annum of the Series C original issue price, subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to Series C. Accrued dividends were to be payable only when, and if declared by the Board of Directors. In addition, holders of Series C were entitled to share ratably in any cash dividends declared and paid on the common stock in an amount per share equal to the amount of the dividend proposed to be paid on a share of common stock multiplied by the number of shares of common stock issuable upon conversion of the Series C. Once the Series C shares were converted to common stock, the accrued dividends that had not been declared by the Board of Directors were relinquished. Upon conversion, none of the accrued dividends had been declared by the Board of Directors. Immediately prior to the conversion of Series C to Common Stock, the Series C shares were fair valued utilizing the share price at the date of conversion. The difference between fair value and book value of $82,654,683 was recorded to net loss attributable to common stockholders. The difference between fair value and book value was net of $64,341,539 of cash proceeds received, net off issuance costs, and $19,687,856 of dividend accretion through the settlement date, of which $7,014,643 was recorded in 2014. See the table below for detail over the cumulative dividends prior to the Company’s IPO. Fair value per Series C share on November 13, 2014 (date of conversion) $ 166,683,790 Cash proceeds received, net of issuance costs (1) (64,341,539 ) Cumulative dividend accretion at December 31, 2013 (12,672,925 ) Dividend accretion during 2014 (7,014,643 ) Additional loss to common shareholders upon conversion of Series C to common stock $ 82,654,683 (1) – Represents the cash proceeds received, net of issuance costs, by the company from Series C investors throughout the life of the security. Series B and Series C were historically classified on the balance sheet outside of permanent equity. There were no preferred stock dividends accrued or payable as of December 31, 2016 or 2015. |
Warrant
Warrant | 12 Months Ended |
Dec. 31, 2016 | |
Warrants And Rights Note Disclosure [Abstract] | |
Warrant | Note 10 – Warrant: In connection with a loan transaction with a bank prior to 2011, and in consideration thereof, the Company issued to a bank a warrant to purchase up to an aggregate of 61,117 shares of voting common stock of the Company at a purchase price of $6.28 per share. In the event the Company issues additional equity instruments at a purchase price or exercise price lower than the warrant exercise price, such exercise price shall be adjusted. The warrant was recorded as a liability with adjustments to fair value recorded in the statement of operations. The warrant is exercised upon surrender to the Company, on a net basis, such that, without the exchange of any funds, such holder purchases that number of shares otherwise issuable upon exercise of its warrant less that number of shares having a current market price at the time of exercise equal to the aggregate exercise price that would otherwise have been paid by such holder upon the exercise of the warrant. The warrant automatically converts in October 2017 without any action by the holder. The accrued value of the warrant as of December 31, 2016 was $253,391. |
Guarantee Agreement
Guarantee Agreement | 12 Months Ended |
Dec. 31, 2016 | |
Guarantees [Abstract] | |
Guarantee Agreement | Note 11 – Guarantee Agreement: In connection with a $62,500,000 revolving note payable, the Company entered into a Fee and Reimbursement Agreement with certain stockholders who were also guarantors of the note. That agreement stipulated that the Company would pay each guarantor a contingent fee equal to 10% per annum of the amount that each guarantor had committed to guarantee. The payment was to be made in the form of newly issued shares of Series C Preferred Stock at the price of $5.25 per share. The fee accrued only from and after the date that the Guarantor entered into the Guarantee, and if at any time any Guarantor’s obligation was terminated in full or in part, the Fee would continue to accrue only with respect to the amount, if any of such Guarantor’s remaining commitment under the Credit Agreement. The fee was contingent in that it would become due and payable only if all principal and interest under the credit agreement had been repaid and a Change of Control had occurred. A Change of Control was defined as any sale, merger, consolidation, share exchange, business combination, equity issuance, or other transaction or series of related transactions, specifically excluding public offerings, which result in the stockholders immediately prior to the transaction(s) owning collectively less than 50% of the voting control immediately following the transaction(s); or (ii) any sale, lease, exchange, transfer, or other disposition of substantially all of the assets, taken as a whole, in a single transaction or series of transactions, excluding sales in the ordinary course of business, sale/leaseback and corporate restructuring transactions. Immediately prior to the closing of the IPO, the Company converted outstanding fees under the guarantee into 2,477,756 shares of Series C, which were then converted into 1,832,531 shares of common stock. The fees on debt guarantee was a financial instrument that was recognized as a liability by the Company and recorded at fair value at issuance. The instrument was then adjusted to its then fair value at each reporting period with changes in fair value recorded in the consolidated statement of operations and comprehensive loss. Historically, the Company measured the fair value of the outstanding fee on debt guarantee using an option pricing method with several possible distribution outcomes depending on the timing and kind of liquidity event. Expected volatility was estimated utilizing the historical volatility of similar companies. The risk-free interest rates was based on the U.S. Treasury yield for a period consistent with the expected contractual life. Upon the conversion of the fees on debt guarantee into shares of Series C, and then subsequently into common stock, the share price of the Company’s common stock was utilized to fair value the fees on debt guarantee and record the final fees on debt guarantee. |
Equity Incentive Plans
Equity Incentive Plans | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Equity Incentive Plans | Note 12 – Equity Incentive Plans: Total compensation cost for share-based payments recognized for the years ended December 31, 2016, 2015, and 2014 was approximately $4,225,149, $3,976,423, and $1,563,976, respectively. Cost of goods sold the year ended December 31, 2016, 2015, and 2014 included share-based compensation of approximately $221,559, $201,086, and $71,669, respectively. Selling, general, and administrative expense for the year ended December 31, 2016, 2015, and 2014 included share-based compensation of approximately $3,971,930, $3,722,770, and $1,492,307, respectively. Capital expenditures recorded during the years ended December 31, 2016 and 2015 for the Freshpet Kitchens expansion project included share-based compensation of approximately $31,660 and $52,566 respectively. 2006 Stock Plan —In December 2006, the Company approved the 2006 Stock Plan (the “2006 Plan”) under which options to purchase approximately 624,223 shares of the Company’s common stock were granted to employees and affiliates of the Company. These options are time-based (vest over five years). Certain option awards provide for accelerated vesting if there is a change in control (as defined in the 2006 Plan). At December 31, 2016, there were zero shares available for grant as the plan is frozen. 2010 Stock Plan —In December 2010, the Company approved the 2010 Stock Plan (the “2010 Plan”) under which options to purchase approximately 2,146,320 shares of the Company’s common stock were granted to employees and affiliates of the Company (in 2012, the 2010 Plan was amended to allow for option to purchase approximately 2,220,280 shares of the Company’s common stock). These options are either time-based (vest over four years), performance-based (vest when performance targets are met, as defined in the stock option grant agreement), or vest at the occurrence of an exit event which is defined as a Change of Control in the Company or an initial public offering registered under the Securities Act, as defined in the stock grant agreement. In November 2014, the Company modified its performance-based awards and exit-event awards under the 2010 Plan. All performance-based awards (680,753 awards) were modified to time-vested awards that cliff vest over two years. At the time of the November 2014 modification the original performance-based awards’ vesting criteria was not considered probable. In addition, all exit-event awards (657,693 awards) were modified to performance-based awards. In December 2016, the Company modified 419,366 of its performance-based awards to time-based awards that vest over two years. These awards were originally included in the November 2014 modification from exit-event awards to performance-based awards. At the time of the December 2016 modification the performance-based awards’ vesting criteria was not considered probable. All modified awards were fair valued on the modification date. As of December 31, 2016 the vesting of any remaining performance-based awards which were not modified in December 2016 is not considered probable of vesting and accordingly the Company has not recognized the related compensation expense. The options granted have maximum contractual terms of 10 years. The Board of Directors froze the 2010 Stock Plan such that no further grants may be issued under the 2010 Stock Plan. 2014 Omnibus Incentive Plan —In November 2014, the Company approved the 2014 Omnibus Incentive Plan (the “2014 Plan”) under which 1,479,200 shares of common stock may be issued or used for reference purposes as awards granted under the 2014 Plan. In September 2016, the 2014 Plan was amended to allow for the granting of an additional 2,500,000 shares of common stock to be issued or used for reference purposes as awards granted, for a total of 3,979,200 shares. These awards may be in the form of stock options, stock appreciation rights, restricted stock, as well as other stock-based and cash-based awards. As of December 31, 2016, the awards granted were either time-based (cliff vest over three years), performance-based (vest when performance targets are met, as defined in the stock option grant agreement), or restricted stock units (employee RSUs cliff vest over three years and non-employee director RSUs cliff vest over one year). At December 31, 2016, there were 2,627,585 shares of common stock available to be issued or used for reference purposes under the 2014 Plan. NASDAQ Marketplace Rules Inducement Award —During the year ended December 31, 2016, 500,000 service period stock options and 500,000 performance-based stock options were granted to the Company’s CEO as an inducement under the NASDAQ Marketplace Rules. Under the terms of the agreement, the grant is governed as if issued under the 2014 Omnibus Plan. As of December 31, 2016, the awards granted were time-based (cliff vest over four years) and performance-based (vest when performance targets are met, as defined in the stock option grant agreement). Service Period Stock Options — A summary of service period stock options outstanding and changes under the plans during the year ended December 31, 2016 is presented below: Options Shares Weighted Average Exercise Price Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2013 1,082,740 $ 6.91 Granted 255,585 15.00 Modified from Performance Based Options to Service Period Stock Options 680,753 7.10 Forfeited (741 ) 6.27 Outstanding at December 31, 2014 2,018,337 $ 7.91 Granted 3,275 17.00 Exercised (44,432 ) 6.57 Forfeited (370 ) 15.00 Outstanding at December 31, 2015 1,976,810 $ 8.00 Granted 845,131 9.75 Modified from Performance Based Options to Service Period Stock Options 419,366 7.10 Exercised (424,710 ) 6.52 Forfeited (12,355 ) 9.97 Expired (15,957 ) 8.12 Outstanding at December 31, 2016 2,788,285 $ 8.61 6.0 $ 5,553,686 Exercisable at December 31, 2016 1,441,782 $ 8.01 4.4 $ 3,897,835 Of the options exercisable at December 31, 2016, 1,274,034 were in-the-money, which account for the entire aggregate intrinsic value. The total intrinsic value of options exercised during the years ended December 31, 2016 and December 31, 2015 were $1,467,076 and $531,962, respectively. A summary of the nonvested service period stock options as of December 31, 2016, and changes during the year ended December 31, 2016, is presented below: Number of Options Weighted-Average Grant-Date Fair Value Per Share Nonvested as of December 31, 2013 189,234 $ 6.02 Granted 255,585 6.34 Modified from Performance Based Options to Service Period Stock Options 680,753 8.90 Vested (171,059 ) 5.83 Forfeited (741 ) 6.25 Nonvested as of December 31, 2014 953,772 $ 8.16 Granted 3,275 7.67 Vested (372,464 ) 8.22 Forfeited (370 ) 6.34 Nonvested as of December 31, 2015 584,213 $ 8.13 Granted 845,131 4.97 Modified from Performance Based Options to Service Period Stock Options 419,366 4.87 Vested (489,851 ) 8.42 Forfeited (12,355 ) 7.22 Nonvested as of December 31, 2016 1,346,503 $ 5.04 As of December 31, 2016, there was $6,027,096 of total unrecognized compensation costs related to non-vested service period options, of which $2,535,584 will be incurred in 2017, $2,202,286 will be incurred in 2018, $841,354 will be incurred in 2019 and the remaining will be incurred in 2020. Performance Based Options — Performance based option vesting is contingent upon the Company achieving certain annual or cumulative revenue goals. A summary of performance-based stock options outstanding and changes under the plans during the year ended December 31, 2016 is presented below: Options Shares Weighted Average Exercise Price Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2013 680,753 $ 7.10 Granted 255,585 15.00 Modified from Exit Event Options to Performance Based Options 657,693 7.10 Modified from Performance Based Options to Service Period Stock Options (680,753 ) 7.10 Outstanding at December 31, 2014 913,278 $ 9.31 Granted 3,275 17.00 Forfeited (370 ) 15.00 Outstanding at December 31, 2015 916,183 $ 9.33 Granted 883,759 9.67 Modified from Performance Based Options to Service Period Stock Options (419,366 ) 7.10 Forfeited (23,015 ) 9.73 Outstanding at December 31, 2016 1,357,561 $ 10.24 8.4 $ 1,141,801 No performance-based options were exercisable at December 31, 2016, 2015, or 2014. A summary of the nonvested performance-based options as of December 31, 2016, and changes during the year ended December 31, 2016, is presented below: Number of Options Weighted-Average Grant-Date Fair Value Per Share Outstanding at January 1, 2014 680,753 $ 5.85 Granted 255,585 6.41 Modified from Exit Event Options to Performance Based Options 657,693 9.31 Modified from Performance Based Options to Service Period Stock Options (680,753 ) (5.85 ) Nonvested as of December 31, 2014 913,278 $ 8.50 Granted 3,275 7.64 Forfeited (370 ) 6.41 Nonvested as of December 31, 2015 916,183 $ 8.50 Granted 883,759 5.19 Modified from Performance Based Options to Service Period Stock Options (419,366 ) 4.87 Forfeited (23,015 ) 8.38 Nonvested as of December 31, 2016 1,357,561 $ 7.47 During the fourth quarter of the year ended December 31, 2015, the achievement of the vesting criteria related to the performance-based awards under the 2010 and 2014 plans (which were modified and granted in November 2014, respectively) was no longer probable. As a result, the Company reversed $2,573,484 of compensation expenses related to performance-based awards during the fourth quarter of the year ended December 31, 2015. Additional performance-based awards were granted in 2016 under the 2014 Omnibus Plan. During the fourth quarter of the year ended December 31, 2016, the achievement of the vesting criteria related to the tranche of these awards which would have vested on December 31, 2016 was no longer probable. As a result, the Company reversed $56,815 of compensation expenses related to performance-based awards during the fourth quarter of the year ended December 31, 2016. As of December 31, 2016, unrecognized compensation costs related to performance-based awards for which the achievement of the vesting criteria is considered probable as of December 31, 2016 have performance target dates ranging from December 31, 2017 through December 31, 2020. There was approximately $2,248,392 of total unrecognized compensation costs related to non-vested performance-based options, of which $648,843 will be incurred in 2017, $655,368 will be incurred in 2018, $471,444 will be incurred in 2019 and the remaining will be incurred in 2020. Restricted Stock Units — The following table includes activity related to outstanding restricted stock units during the twelve months ended December 31, 2016. Shares Weighted-Average Grant-Date Fair Value Per Unit Outstanding at December 31, 2013 — — Granted 24,166 15.00 Outstanding at December 31, 2014 24,166 $ 15.00 Issued Upon Vesting (24,166 ) 15.00 Outstanding at December 31, 2015 — $ — Granted 105,313 9.05 Forfeited (7,798 ) 9.05 Outstanding at December 31, 2016 97,515 $ 9.05 As of December 31, 2016, there was approximately $537,513 of total unrecognized compensation costs related to restricted stock units, of which $302,447 will be incurred in 2017, $173,332 will be incurred in 2018, and $61,735 will be incurred in 2019. Exit Event Options — Exit event option vesting is contingent upon the occurrence of an exit event, which results from a Change of Control in the Company or an Initial Public Offering of the Company’s common stock under the Securities Act, as defined in the option grant agreement. A summary of exit event stock options outstanding and changes under the plans during the year ended December 31, 2014 is presented below: Options Shares Weighted Average Exercise Price Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2013 876,924 $ 7.10 Cancelled (219,231 ) 7.10 Modified from Exit Event Options to Performance Based Options (657,693 ) 7.10 Outstanding at December 31, 2014 — $ — — $ — No exit event options were granted during 2016 or 2015. A summary of the nonvested exit event stock options as of December 31, 2014 Number of Options Weighted-Average Grant-Date Fair Value Per Share Outstanding at January 1, 2014 876,924 $ 5.85 Cancelled (219,231 ) 5.85 Modified from Exit Event Options to Performance Based Options (657,693 ) 5.85 Nonvested as of December 31, 2014 — $ — Grant Date Fair Value of Options —The weighted average grant date fair value of options (service period options and performance based options) granted during the years ended December 31, 2016, 2015, and 2014 were $5.09, $7.66 and $8.35 per share, respectively. Expected Volatility— For the grants during the year ended December 31, 2013, the expected volatility was based on the historical volatility of the Company’s common stock. The Company utilized its historical stock price as an indicator of volatility for all grants prior to 2013. The grants during 2014 all occurred while the Company was publicly traded. Subsequent to the IPO, we no longer deemed it appropriate to use historical volatility as it was not representative of the Company’s stock on the public market. As such expected volatility that was utilized was based upon the volatility of a group of similar entities, referred to as “guideline” companies. As Freshpet has more historical data based on more time as a public company, the historical volatility of Freshpet becomes a more significant input. Weighted Average Expected Term —The Company determined the expected term based on the “shortcut method” described in FASB ASC 718, Compensation— (an expected term based on the midpoint between the vesting date and the end of the contractual term). Risk-Free Interest Rate —The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. Expected Dividend Yield —The Company has not historically declared dividends, and no future dividends are expected to be available to benefit option holders. Accordingly, the Company used an expected dividend yield of zero in the valuation model. Year Ended December 31, 2016 2015 2014 Expected volatility 52.6% - 53.2% 45.6% 41.9% Average expected terms in years 5.3 - 7.2 5.4 -6.4 3.9 -6.6 Risk-free interest rate 1.26% - 1.36% 1.6% 1.01% - 2.09% Expected dividend yield 0.0% 0.0% 0.0% |
Net Loss Attributable to Common
Net Loss Attributable to Common Stockholders | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Attributable to Common Stockholders | Note 13 – Net Loss Attributable to Common Stockholders: Basic net loss per common share is calculated by dividing net loss attributable to common stockholders by the weighted-average number of common share outstanding for the period. Diluted net loss per common share is computed by giving effect to all potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share, due to the fact that potentially dilutive securities would have an antidilutive effect as the Company incurred a net loss for the years ended December 31, 2016, 2015 and 2014. The computation of net income attributable to common stockholders is as follows: Twelve Months Ended December 31, 2016 2015 2014 Net loss $ (3,160,673 ) $ (3,710,812 ) $ (37,339,017 ) Preferred stock dividends on Series B and Series C — — (11,286,193 ) Additional loss attributable to common stockholders upon conversion of Series C Preferred Stock into common stock — — (82,654,683 ) Net loss attributable to common stockholders $ (3,160,673 ) $ (3,710,812 ) $ (131,279,893 ) The potentially dilutive securities excluded from the determination of diluted loss per share, as their effect is antidilutive, are as follows: Twelve Months Ended December 31, 2016 2015 2014 Service Period Stock Options 2,299,468 1,991,209 1,220,739 Restricted Stock Units 65,439 — — Warrants 61,117 61,117 61,117 Total 2,426,024 2,052,326 1,281,856 |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plan | Note 14 – Retirement Plan: The Company sponsors a safe harbor 401(k) plan covering all employees. All employees are eligible to participate. Active participants in the plan may make contributions of up to 50% of their compensation, subject to certain limitations. Company contributions totaled approximately $497,731 in 2016, $380,357 in 2015, and $307,754 in 2014. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 15 – Related Party Transactions: Payments made to a privately held entity, who is a stockholder of the Company, for the purchase of raw materials totaled approximately $6,565,384 in 2016, $6,068,038 in 2015, and $5,545,835 in 2014. The Company believes that all payments made to the shareholder are at market value and thus at arms-length |
Concentrations
Concentrations | 12 Months Ended |
Dec. 31, 2016 | |
Risks And Uncertainties [Abstract] | |
Concentrations | Note 16 – Concentrations: Concentration of Credit Risk —The Company maintains its cash balances in financial institutions that are insured by the Federal Deposit Insurance Corporation up to $250,000 each. At times, such balances may be in excess of the FDIC insurance limit. Major Customers —In 2016, 2015, and 2014, net sales to one of our distributors which sells directly to three of our customers, accounted for 23%, 22%, and 22% of our net sales, respectively. In 2016, no customers accounted for 10% of our net sales, while for the same period in 2015, one customer accounted for more than 10% of our net sales. In 2014, no customer accounted for more than 10% of our net sales. Major Suppliers —The Company purchased approximately 23% of its raw materials from one vendor during 2016, approximately 34% of its raw materials from two vendors during 2015, and approximately 54% of its raw materials from three vendors during 2014. The Company also purchased approximately 89% of its treats finished goods from four vendors in 2016, approximately 90% from three vendors in 2015, and approximately 96% from three vendors in 2014. The Company purchased approximately 84% of its packaging material from three vendors during 2016, 64% of its packaging material from three vendors during 2015, and approximately 74% of its packaging material from three vendors during 2014. Net Sales by Class of Retail —The following table sets forth net sales by class of retail. Year Ended December 31, 2016 2015 2014 Grocery, Mass and Club $ 104,708,513 $ 89,131,925 $ 65,212,966 Pet Specialty, Natural and Other 28,345,003 27,054,447 21,551,146 Net Sales $ 133,053,517 $ 116,186,372 $ 86,764,112 (1) Other sales represent less than 1% of net sales |
Unaudited Quarterly Results
Unaudited Quarterly Results | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Unaudited Quarterly Results | Note 17 – Unaudited Quarterly Results: Unaudited quarterly results for the years ended December 31, 2016, 2015, and 2014 were as follows: First Quarter Second Quarter Third Quarter Fourth Quarter 2016: Net sales 31,453,700 33,002,209 34,536,151 34,061,456 Income/(loss) from operations (1,599,195 ) (2,974,942 ) 808,196 1,550,989 Net Income/(loss) (1,771,802 ) (3,243,002 ) 620,730 1,233,400 Net Income/(loss) attributable to common stockholders (1,771,802 ) (3,243,002 ) 620,730 1,233,400 Basic earnings/(loss) per common share (0.05 ) (0.10 ) 0.02 0.04 Diluted earnings/(loss) per common share (0.05 ) (0.10 ) 0.02 0.04 2015: Net sales 27,054,674 28,359,404 30,570,506 30,201,788 Income/(loss) from operations (2,424,578 ) (2,078,083 ) (2,013,698 ) 2,868,688 Net Income/(loss) (2) (2,587,074 ) (2,228,650 ) (1,675,350 ) 2,780,262 Net Income/(loss) attributable to common stockholders (2) (2,587,074 ) (2,228,650 ) (1,675,350 ) 2,780,262 Basic earnings/(loss) per common share (0.08 ) (0.07 ) (0.05 ) 0.08 Diluted earnings/(loss) per common share (0.08 ) (0.07 ) (0.05 ) 0.08 2014: Net sales 19,350,197 20,386,038 22,519,672 24,508,205 Income/(loss) from operations (2,301,404 ) 3,328,420 (1,338,419 ) 550,551 Net Income/(loss) (5,142,223 ) (6,266,803 ) (9,483,241 ) (16,446,750 ) Net Income/(loss) attributable to common stockholders (1) (7,485,640 ) (10,771,077 ) (12,380,254 ) (100,642,922 ) Basic earnings/(loss) per common share (0.53 ) (0.77 ) (1.19 ) (4.35 ) Diluted earnings/(loss) per common share (0.53 ) (0.77 ) (1.19 ) (4.35 ) (1) See note 9 for further detail regarding the dividend accretion that is included within net loss attributable to common stockholders. (2) Fourth quarter 2015 results include the reversal of $2.6 million of stock-based compensation expense related to performance-based awards. See Note 12. |
Nature of the Business and Su24
Nature of the Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Nature of the Business | Nature of the Business – Freshpet, Inc. (hereafter referred to as “Freshpet” or the “Company”), a Delaware corporation, manufactures and markets natural fresh, refrigerated meals and treats for dogs and cats. The Company’s products are distributed throughout the United States, Canada and an international test market into major retail classes including Grocery and Mass (which includes club) as well as Pet specialty and Natural retail. |
Principles of Consolidation | Principles of Consolidation – The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”). The financial statements include the accounts of the Company as well as the Company’s wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Segments | Segments – The Company operates as a single operating segment reporting to its chief operating decision maker. |
Estimates and Uncertainties | Estimates and Uncertainties – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results, as determined at a later date, could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents – The Company at times considers money market funds and all other highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. |
Short-Term Investments | Short-Term Investments – The Company at times holds interest-bearing certificates of deposits with financial institutions with maturities ranging from three months to one year. Certificates of deposit are classified as short-term investments and interest is recorded as other expenses, net. Historically, interest income has not been material. The Company will continue to monitor interest income and will disclose separately if significant. |
Accounts Receivable | Accounts Receivable – The Company records trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on its history of write-offs and collections and current credit conditions. Accounts receivable are written off when management deems them to be uncollectible. |
Inventories | Inventories – Inventories are stated at the lower of cost or market, using the first-in, first-out method. When necessary, the Company provides allowances to adjust the carrying value of its inventories to the lower of cost or net realizable value, including any costs to sell or dispose and consideration for obsolescence, excessive inventory levels, product deterioration and other factors in evaluating net realizable value. |
Property, Plant and Equipment | Property, Plant and Equipment – Property, plant and equipment are recorded at cost. The Company provides for depreciation on the straight-line method by charges to income at rates based upon estimated recovery periods of 7 years for furniture and office equipment, 5 years for automotive equipment, 9 years for refrigeration equipment, 5 to 10 years for machinery and equipment, and 15 to 39 years for building and improvements. Capitalized cost includes the costs incurred to bring the property, plant and equipment to the condition and location necessary for its intended use, which includes any necessary delivery, electrical and installation cost for equipment. Maintenance and repairs that do not extend the useful life of the assets over two years are charged to expense as incurred. Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful lives on the straight-line method. |
Long-Lived Assets | Long-Lived Assets – The Company evaluates all long-lived assets for impairment. Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Recoverability of assets held for sale is measured by a comparison of the carrying amount of an asset or asset group to their fair value less estimated costs to sell. Estimating future cash flows and calculating fair value of assets requires significant estimates and assumptions by management. If the carrying amount is not fully recoverable, an impairment loss is recognized to reduce the carry amount to fair value, and is charged to expense in the period of impairment. |
Income Taxes | Income Taxes – The Company provides for deferred income taxes for temporary differences between financial and income tax reporting, principally net operating loss carryforwards, depreciation, and share-based compensation. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is appropriate when management believes it is more likely than not, the deferred tax asset will not be realized. At December 31, 2016, and 2015, the Company determined that a valuation allowance of 100% is appropriate. |
Revenue Recognition and Incentives | Revenue Recognition and Incentives – Revenue from product sales is recognized upon shipment to the customers as terms are free on board (“FOB”) shipping point, at which point title and risk of loss is transferred and the selling price is fixed or determinable. This completes the revenue-earning process specifically that an arrangement exists, delivery has occurred, ownership has transferred, the price is fixed and collectability is reasonably assured. A provision for payment discounts and product return allowances, which is estimated based upon the Company’s historical performance, management’s experience and current economic trends, is recorded as a reduction of sales in the same period that the revenue is recognized. Trade incentives, consisting primarily of customer pricing allowances and merchandising funds, and consumer coupons are offered through various programs to customers and consumers. Sales are recorded net of estimated trade incentive spending, which is recognized as incurred at the time of sale. Accruals for expected payouts under these programs are included as accrued expense in the consolidated balance sheet. Coupon redemption costs are also recognized as reductions of net sales when the coupons are issued. Estimates of trade promotion expense and coupon redemption costs are based upon programs offered, timing of those offers, estimated redemption/usage rates from historical performance, management’s experience and current economic trends. |
Advertising | Advertising – Advertising costs are expensed when incurred, with the exception of production costs which are expensed the first time advertising takes place. Advertising costs, consisting primarily of media ads, were $15,374,392, $16,302,237, and $14,231,930, in 2016, 2015, and 2014, respectively. |
Shipping and Handling Costs/Freight Out | Shipping and Handling Costs/Freight Out – Costs incurred for shipping and handling are included in selling, general, and administrative expenses within the statement of operations and comprehensive loss. Shipping and handling costs primarily consist of costs associated with moving finished products to customers, including costs associated with our distribution center and the cost of shipping products to customers through third-party carriers. Shipping and handling cost totaled $11,202,392, $11,407,908, and $9,447,406 for the years ended December 31, 2016, 2015, and 2014, respectively. |
Research & development | Research & development – Research and development costs consist of expenses to develop and test new products. The cost are expensed as incurred. |
Share-Based Compensation | Share-Based Compensation – The Company recognizes share-based compensation based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period. Share-based compensation expense recognized in the statement of operations included compensation expense for share-based payment awards granted subsequent to December 31, 2006, based on the grant date fair value estimated. Share awards are amortized under the straight-line method over the requisite service period of the entire award. Upon the adoption of ASU 2016-09, the Company no longer estimates expected forfeitures but accounts for forfeitures as they occur. The Company determines the fair value of the stock options granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments – Financial Accounting Standards Board (“FASB”) guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: • Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities. • Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial instruments that are valued using models or other valuation methodologies. • Level 3 – Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable. The carrying amounts reported in the balance sheets for cash and cash equivalents, other receivables, accounts payable and accrued expenses approximate their fair value based on the short-term maturity of these instruments. The warrant liability is recorded at fair value with changes in fair value reflected in the statement of operations and comprehensive loss. As of December 31, 2016, the Company only maintained Level 1 assets and liabilities. |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories are summarized as follows: December 31, 2016 2015 Raw Materials and Work in Process $ 1,568,789 $ 1,493,654 Packaging Components Material 908,771 1,161,814 Finished Goods 3,219,634 4,374,494 5,697,194 7,029,962 Reserve for Obsolete Inventory (294,459 ) (176,515 ) $ 5,402,735 $ 6,853,447 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Abstract] | |
Summary of Property, Plant and Equipment, Net | December 31, 2016 2015 Refrigeration Equipment $ 62,603,188 $ 55,020,179 Machinery and Equipment 45,953,884 21,324,085 Building, Land, and Improvements 25,114,611 15,205,494 Furniture and Office Equipment 3,941,995 2,287,396 Automotive Equipment 317,615 317,292 Leasehold Improvements 297,681 140,672 Construction in Progress 2,841,035 19,388,195 141,070,009 113,683,313 Less: Accumulated Depreciation and Amortization (39,576,929 ) (30,890,306 ) $ 101,493,080 $ 82,793,007 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Summary of Income Taxes | A summary of income taxes as follows: December 31, 2016 2015 2014 Current: Federal $ — $ — $ — State 65,754 57,516 41,753 $ 65,754 $ 57,516 $ 41,753 |
Schedule of Reconciliation of the Statutory Federal Income Tax Rate | The reconciliation of the statutory federal income tax rate to the Company’s effective tax is presented below: December 31, 2016 2015 2014 Tax at federal statutory rate 34.00 % 34.00 % 34.00 % State taxes, net of federal 1.95 0.95 0.13 Permanent items (3.19 ) (1.33 ) (18.40 ) Other 0.54 (0.09 ) (1.58) Valuation allowance (35.43 ) (35.11 ) (14.26 ) Effective tax rate (2.13) % (1.58 )% (0.11 )% |
Significant Portions of the Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows: December 31, 2016 2015 Net deferred tax asset carryforward $ 59,491,094 $ 58,386,785 Stock option expense 3,155,006 2,745,796 Property and equipment (10,400,982 ) (7,687,008 ) Other 981,050 613,190 Less: Valuation allowance (53,226,168 ) (54,058,763 ) Net deferred tax $ — $ — |
Net Deferred Tax Assets and Liabilities | Net deferred tax assets and liabilities are summarized as follows: December 31, 2016 2015 Total deferred tax assets $ 63,627,150 $ 61,745,771 Total deferred tax liabilities (10,400,982 ) (7,687,008 ) Valuation allowance (53,226,168 ) (54,058,763 ) Net deferred income tax assets $ — $ — |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables And Accruals [Abstract] | |
Summary of Accrued Expenses | December 31, 2016 2015 Accrued Compensation $ 1,895,443 $ 451,819 Accrued Leadership Transition Expense (1) 428,150 — Accrued Chiller Cost 1,010,018 559,957 Accrued Freight 359,009 337,233 Accrued Marketing 211,184 231,353 Accrued Insurance — 218,134 Accrued Sales and Use Tax 45,886 45,886 Other Accrued Expenses 581,449 430,175 $ 4,531,139 $ 2,274,557 (1) Accrued Leadership Transition Costs represent unpaid costs detailed within our former Chief Executive Officer’s separation agreement. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Rentals Due | As of December 31, 2016, future minimum rentals due under these leases for the next five years were as follows: December 31, 2017 78,219 2018 468,465 2019 478,667 2020 488,870 2021 499,072 2022 and thereafter 1,293,167 $ 3,306,460 |
Redeemable Preferred Stock (Tab
Redeemable Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Summary of Cumulative Dividends | See the table below for detail over the cumulative dividends prior to the Company’s IPO. Fair value per Series C share on November 13, 2014 (date of conversion) $ 166,683,790 Cash proceeds received, net of issuance costs (1) (64,341,539 ) Cumulative dividend accretion at December 31, 2013 (12,672,925 ) Dividend accretion during 2014 (7,014,643 ) Additional loss to common shareholders upon conversion of Series C to common stock $ 82,654,683 (1) – Represents the cash proceeds received, net of issuance costs, by the company from Series C investors throughout the life of the security. |
Equity Incentive Plans (Tables)
Equity Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Expected Dividend Yield Valuation Model | Expected Dividend Yield —The Company has not historically declared dividends, and no future dividends are expected to be available to benefit option holders. Accordingly, the Company used an expected dividend yield of zero in the valuation model. Year Ended December 31, 2016 2015 2014 Expected volatility 52.6% - 53.2% 45.6% 41.9% Average expected terms in years 5.3 - 7.2 5.4 -6.4 3.9 -6.6 Risk-free interest rate 1.26% - 1.36% 1.6% 1.01% - 2.09% Expected dividend yield 0.0% 0.0% 0.0% |
Service Period Stock Options | |
Summary of Stock Options Outstanding and Changes under Plans | Service Period Stock Options — A summary of service period stock options outstanding and changes under the plans during the year ended December 31, 2016 is presented below: Options Shares Weighted Average Exercise Price Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2013 1,082,740 $ 6.91 Granted 255,585 15.00 Modified from Performance Based Options to Service Period Stock Options 680,753 7.10 Forfeited (741 ) 6.27 Outstanding at December 31, 2014 2,018,337 $ 7.91 Granted 3,275 17.00 Exercised (44,432 ) 6.57 Forfeited (370 ) 15.00 Outstanding at December 31, 2015 1,976,810 $ 8.00 Granted 845,131 9.75 Modified from Performance Based Options to Service Period Stock Options 419,366 7.10 Exercised (424,710 ) 6.52 Forfeited (12,355 ) 9.97 Expired (15,957 ) 8.12 Outstanding at December 31, 2016 2,788,285 $ 8.61 6.0 $ 5,553,686 Exercisable at December 31, 2016 1,441,782 $ 8.01 4.4 $ 3,897,835 |
Summary of Nonvested Service Period Stock Options | A summary of the nonvested service period stock options as of December 31, 2016, and changes during the year ended December 31, 2016, is presented below: Number of Options Weighted-Average Grant-Date Fair Value Per Share Nonvested as of December 31, 2013 189,234 $ 6.02 Granted 255,585 6.34 Modified from Performance Based Options to Service Period Stock Options 680,753 8.90 Vested (171,059 ) 5.83 Forfeited (741 ) 6.25 Nonvested as of December 31, 2014 953,772 $ 8.16 Granted 3,275 7.67 Vested (372,464 ) 8.22 Forfeited (370 ) 6.34 Nonvested as of December 31, 2015 584,213 $ 8.13 Granted 845,131 4.97 Modified from Performance Based Options to Service Period Stock Options 419,366 4.87 Vested (489,851 ) 8.42 Forfeited (12,355 ) 7.22 Nonvested as of December 31, 2016 1,346,503 $ 5.04 |
Performance Based Options | |
Summary of Stock Options Outstanding and Changes under Plans | A summary of performance-based stock options outstanding and changes under the plans during the year ended December 31, 2016 is presented below: Options Shares Weighted Average Exercise Price Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2013 680,753 $ 7.10 Granted 255,585 15.00 Modified from Exit Event Options to Performance Based Options 657,693 7.10 Modified from Performance Based Options to Service Period Stock Options (680,753 ) 7.10 Outstanding at December 31, 2014 913,278 $ 9.31 Granted 3,275 17.00 Forfeited (370 ) 15.00 Outstanding at December 31, 2015 916,183 $ 9.33 Granted 883,759 9.67 Modified from Performance Based Options to Service Period Stock Options (419,366 ) 7.10 Forfeited (23,015 ) 9.73 Outstanding at December 31, 2016 1,357,561 $ 10.24 8.4 $ 1,141,801 |
Summary of Nonvested Service Period Stock Options | A summary of the nonvested performance-based options as of December 31, 2016, and changes during the year ended December 31, 2016, is presented below: Number of Options Weighted-Average Grant-Date Fair Value Per Share Outstanding at January 1, 2014 680,753 $ 5.85 Granted 255,585 6.41 Modified from Exit Event Options to Performance Based Options 657,693 9.31 Modified from Performance Based Options to Service Period Stock Options (680,753 ) (5.85 ) Nonvested as of December 31, 2014 913,278 $ 8.50 Granted 3,275 7.64 Forfeited (370 ) 6.41 Nonvested as of December 31, 2015 916,183 $ 8.50 Granted 883,759 5.19 Modified from Performance Based Options to Service Period Stock Options (419,366 ) 4.87 Forfeited (23,015 ) 8.38 Nonvested as of December 31, 2016 1,357,561 $ 7.47 |
Restricted Stock Units | |
Summary of Stock Options Outstanding and Changes under Plans | Restricted Stock Units — The following table includes activity related to outstanding restricted stock units during the twelve months ended December 31, 2016. Shares Weighted-Average Grant-Date Fair Value Per Unit Outstanding at December 31, 2013 — — Granted 24,166 15.00 Outstanding at December 31, 2014 24,166 $ 15.00 Issued Upon Vesting (24,166 ) 15.00 Outstanding at December 31, 2015 — $ — Granted 105,313 9.05 Forfeited (7,798 ) 9.05 Outstanding at December 31, 2016 97,515 $ 9.05 |
Exit Event Options | |
Summary of Stock Options Outstanding and Changes under Plans | A summary of exit event stock options outstanding and changes under the plans during the year ended December 31, 2014 is presented below: Options Shares Weighted Average Exercise Price Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2013 876,924 $ 7.10 Cancelled (219,231 ) 7.10 Modified from Exit Event Options to Performance Based Options (657,693 ) 7.10 Outstanding at December 31, 2014 — $ — — $ — |
Summary of Nonvested Service Period Stock Options | No exit event options were granted during 2016 or 2015. A summary of the nonvested exit event stock options as of December 31, 2014 Number of Options Weighted-Average Grant-Date Fair Value Per Share Outstanding at January 1, 2014 876,924 $ 5.85 Cancelled (219,231 ) 5.85 Modified from Exit Event Options to Performance Based Options (657,693 ) 5.85 Nonvested as of December 31, 2014 — $ — |
Net Loss Attributable to Comm32
Net Loss Attributable to Common Stockholders (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Net Income Attributable to Common Stockholders | The computation of net income attributable to common stockholders is as follows: Twelve Months Ended December 31, 2016 2015 2014 Net loss $ (3,160,673 ) $ (3,710,812 ) $ (37,339,017 ) Preferred stock dividends on Series B and Series C — — (11,286,193 ) Additional loss attributable to common stockholders upon conversion of Series C Preferred Stock into common stock — — (82,654,683 ) Net loss attributable to common stockholders $ (3,160,673 ) $ (3,710,812 ) $ (131,279,893 ) |
Schedule of Potentially Dilutive Securities Excluded from Determination of Diluted Loss per Share, as Their Effect is Antidilutive | The potentially dilutive securities excluded from the determination of diluted loss per share, as their effect is antidilutive, are as follows: Twelve Months Ended December 31, 2016 2015 2014 Service Period Stock Options 2,299,468 1,991,209 1,220,739 Restricted Stock Units 65,439 — — Warrants 61,117 61,117 61,117 Total 2,426,024 2,052,326 1,281,856 |
Concentrations (Tables)
Concentrations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Risks And Uncertainties [Abstract] | |
Net Sales by Class of Retail | Net Sales by Class of Retail —The following table sets forth net sales by class of retail. Year Ended December 31, 2016 2015 2014 Grocery, Mass and Club $ 104,708,513 $ 89,131,925 $ 65,212,966 Pet Specialty, Natural and Other 28,345,003 27,054,447 21,551,146 Net Sales $ 133,053,517 $ 116,186,372 $ 86,764,112 (1) Other sales represent less than 1% of net sales |
Unaudited Quarterly Results (Ta
Unaudited Quarterly Results (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Unaudited Quarterly Results | Unaudited quarterly results for the years ended December 31, 2016, 2015, and 2014 were as follows: First Quarter Second Quarter Third Quarter Fourth Quarter 2016: Net sales 31,453,700 33,002,209 34,536,151 34,061,456 Income/(loss) from operations (1,599,195 ) (2,974,942 ) 808,196 1,550,989 Net Income/(loss) (1,771,802 ) (3,243,002 ) 620,730 1,233,400 Net Income/(loss) attributable to common stockholders (1,771,802 ) (3,243,002 ) 620,730 1,233,400 Basic earnings/(loss) per common share (0.05 ) (0.10 ) 0.02 0.04 Diluted earnings/(loss) per common share (0.05 ) (0.10 ) 0.02 0.04 2015: Net sales 27,054,674 28,359,404 30,570,506 30,201,788 Income/(loss) from operations (2,424,578 ) (2,078,083 ) (2,013,698 ) 2,868,688 Net Income/(loss) (2) (2,587,074 ) (2,228,650 ) (1,675,350 ) 2,780,262 Net Income/(loss) attributable to common stockholders (2) (2,587,074 ) (2,228,650 ) (1,675,350 ) 2,780,262 Basic earnings/(loss) per common share (0.08 ) (0.07 ) (0.05 ) 0.08 Diluted earnings/(loss) per common share (0.08 ) (0.07 ) (0.05 ) 0.08 2014: Net sales 19,350,197 20,386,038 22,519,672 24,508,205 Income/(loss) from operations (2,301,404 ) 3,328,420 (1,338,419 ) 550,551 Net Income/(loss) (5,142,223 ) (6,266,803 ) (9,483,241 ) (16,446,750 ) Net Income/(loss) attributable to common stockholders (1) (7,485,640 ) (10,771,077 ) (12,380,254 ) (100,642,922 ) Basic earnings/(loss) per common share (0.53 ) (0.77 ) (1.19 ) (4.35 ) Diluted earnings/(loss) per common share (0.53 ) (0.77 ) (1.19 ) (4.35 ) (1) See note 9 for further detail regarding the dividend accretion that is included within net loss attributable to common stockholders. (2) Fourth quarter 2015 results include the reversal of $2.6 million of stock-based compensation expense related to performance-based awards. See Note 12. |
Nature of the Business and Su35
Nature of the Business and Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2016USD ($)OperatingSegment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Number of operating segments | OperatingSegment | 1 | ||
Property plant and equipment depreciation method | The Company provides for depreciation on the straight-line method by charges to income at rates based upon estimated recovery periods | ||
Deferred tax asset valuation allowance | 100.00% | 100.00% | |
Advertising expense | $ 15,374,392 | $ 16,302,237 | $ 14,231,930 |
Shipping and handling cost | $ 11,202,392 | $ 11,407,908 | $ 9,447,406 |
Furniture and Office Equipment | |||
Estimated useful life | 7 years | ||
Automotive Equipment | |||
Estimated useful life | 5 years | ||
Refrigeration Equipment | |||
Estimated useful life | 9 years | ||
Machinery and Equipment | Minimum | |||
Estimated useful life | 5 years | ||
Machinery and Equipment | Maximum | |||
Estimated useful life | 10 years | ||
Building and Improvements | Minimum | |||
Estimated useful life | 15 years | ||
Building and Improvements | Maximum | |||
Estimated useful life | 39 years |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw Materials and Work in Process | $ 1,568,789 | $ 1,493,654 |
Packaging Components Material | 908,771 | 1,161,814 |
Finished Goods | 3,219,634 | 4,374,494 |
Inventory gross | 5,697,194 | 7,029,962 |
Reserve for Obsolete Inventory | (294,459) | (176,515) |
Inventory net | $ 5,402,735 | $ 6,853,447 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment, Net (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 141,070,009 | $ 113,683,313 |
Less: Accumulated Depreciation and Amortization | (39,576,929) | (30,890,306) |
Property, plant and equipment, net | 101,493,080 | 82,793,007 |
Refrigeration Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 62,603,188 | 55,020,179 |
Machinery and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 45,953,884 | 21,324,085 |
Building, Land, and Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 25,114,611 | 15,205,494 |
Furniture and Office Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 3,941,995 | 2,287,396 |
Automotive Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 317,615 | 317,292 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 297,681 | 140,672 |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 2,841,035 | $ 19,388,195 |
Property, Plant and Equipment38
Property, Plant and Equipment - Additional Information (Details) | 1 Months Ended | 12 Months Ended | 24 Months Ended | ||
Jun. 30, 2015USD ($)a | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2016USD ($) | |
Property Plant And Equipment [Line Items] | |||||
Depreciation and amortization | $ 9,887,168 | $ 7,573,535 | $ 6,424,813 | ||
Cost of goods sold, depreciation and amortization | 4,028,022 | 2,566,013 | 2,453,883 | ||
Purchase of land in acres | a | 6.5 | ||||
Facilities manufacturing for land and building approximate value | 5,026,250 | ||||
Purchase of land approximate value | $ 2,100,000 | ||||
Borrowings under credit facilities | 10,000,000 | ||||
Repayment under credit facilities | 3,000,000 | ||||
Building, Land, and Improvements | |||||
Property Plant And Equipment [Line Items] | |||||
Facilities manufacturing for land and building approximate value | $ 5,000,000 | ||||
Kitchens Manufacturing Facility | |||||
Property Plant And Equipment [Line Items] | |||||
Capital expenditures | 17,600,000 | 17,600,000 | $ 35,200,000 | ||
Incremental depreciation expense | 1,600,000 | ||||
Borrowings under credit facilities | 10,000,000 | ||||
Repayment under credit facilities | 3,000,000 | ||||
Property, Plant and Equipment | |||||
Property Plant And Equipment [Line Items] | |||||
Depreciation and amortization | $ 9,708,062 | $ 7,433,876 | $ 6,356,736 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | |||
State | $ 65,754 | $ 57,516 | $ 41,753 |
Deferred income taxes | $ 65,754 | $ 57,516 | $ 41,753 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of the Statutory Federal Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Abstract] | |||
Tax at federal statutory rate | 34.00% | 34.00% | 34.00% |
State taxes, net of federal | 1.95% | 0.95% | 0.13% |
Permanent items | (3.19%) | (1.33%) | (18.40%) |
Other | 0.54% | (0.09%) | (1.58%) |
Valuation allowance | (35.43%) | (35.11%) | (14.26%) |
Effective tax rate | (2.13%) | (1.58%) | (0.11%) |
Income Taxes - Significant Port
Income Taxes - Significant Portions of the Deferred Tax Assets and Deferred Tax Liabilities (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax Assets Net [Abstract] | ||
Net deferred tax asset carryforward | $ 59,491,094 | $ 58,386,785 |
Stock option expense | 3,155,006 | 2,745,796 |
Property and equipment | (10,400,982) | (7,687,008) |
Other | 981,050 | 613,190 |
Less: Valuation allowance | $ (53,226,168) | $ (54,058,763) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax [Line Items] | ||
Net deferred tax asset carryforward | $ 59,491,094 | $ 58,386,785 |
Uncertain tax positions | 0 | |
Income tax interest and penalties expense | 0 | |
New Jersey | ||
Income Tax [Line Items] | ||
Net deferred tax asset carryforward | $ 132,394,673 | |
New Jersey | Earliest Tax Year | ||
Income Tax [Line Items] | ||
Net operating loss carryforwards, expiration year | 2,016 | |
New Jersey | Latest Tax Year | ||
Income Tax [Line Items] | ||
Net operating loss carryforwards, expiration year | 2,036 | |
Federal | ||
Income Tax [Line Items] | ||
Net deferred tax asset carryforward | $ 160,728,383 | |
Federal | Earliest Tax Year | ||
Income Tax [Line Items] | ||
Net operating loss carryforwards, expiration year | 2,025 | |
Federal | Latest Tax Year | ||
Income Tax [Line Items] | ||
Net operating loss carryforwards, expiration year | 2,036 |
Income Taxes - Net Deferred Tax
Income Taxes - Net Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax Assets Net [Abstract] | ||
Total deferred tax assets | $ 63,627,150 | $ 61,745,771 |
Total deferred tax liabilities | (10,400,982) | (7,687,008) |
Valuation allowance | $ (53,226,168) | $ (54,058,763) |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | |
Payables And Accruals [Abstract] | |||
Accrued Compensation | $ 1,895,443 | $ 451,819 | |
Accrued Leadership Transition Expense | [1] | 428,150 | |
Accrued Chiller Cost | 1,010,018 | 559,957 | |
Accrued Freight | 359,009 | 337,233 | |
Accrued Marketing | 211,184 | 231,353 | |
Accrued Insurance | 218,134 | ||
Accrued Sales and Use Tax | 45,886 | 45,886 | |
Other Accrued Expenses | 581,449 | 430,175 | |
Accrued expenses | $ 4,531,139 | $ 2,274,557 | |
[1] | Accrued Leadership Transition Costs represent unpaid costs detailed within our former Chief Executive Officer’s separation agreement. |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Dec. 23, 2014 | Nov. 13, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | |||||
Borrowings under credit facilities | $ 10,000,000 | ||||
Repayment under credit facilities | 3,000,000 | ||||
Debt outstanding | 7,000,000 | $ 0 | |||
Accrued interest | 0 | ||||
Interest expense and fees | 700,000 | $ 500,000 | $ 4,600,000 | ||
Maximum | |||||
Debt Instrument [Line Items] | |||||
Accrued interest | 100,000 | ||||
$40,000,000 Credit Facilities | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 40,000,000 | ||||
Availability under credit facilities | 30,000,000 | ||||
Capex Commitments | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 12,000,000 | ||||
Borrowings under credit facilities | 10,000,000 | ||||
Repayment under credit facilities | $ 3,000,000 | ||||
Capex Commitments | $40,000,000 Credit Facilities | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | 30,000,000 | ||||
Term Facility | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 18,000,000 | ||||
Credit facility term | 5 years | ||||
Term Facility | $40,000,000 Credit Facilities | |||||
Debt Instrument [Line Items] | |||||
Extinguishment amount of debt | 18,000,000 | ||||
Revolving Facility | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 10,000,000 | ||||
Credit facility term | 3 years | ||||
Increase in credit facility | $ 20,000,000 | ||||
Revolving Facility | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, applicable margin | 3.75% | ||||
Revolving Facility | Base Rate | Minimum | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, applicable margin | 2.75% | ||||
Revolving Facility | Base Rate | Maximum | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, applicable margin | 3.75% | ||||
Revolving Facility | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, applicable margin | 4.75% | ||||
Revolving Facility | LIBOR | Minimum | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, applicable margin | 3.75% | ||||
Revolving Facility | LIBOR | Maximum | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, applicable margin | 4.75% |
Commitments and Contingencies -
Commitments and Contingencies - Future Minimum Rentals Due (Details) | Dec. 31, 2016USD ($) |
Operating Leases Future Minimum Payments Due [Abstract] | |
2,017 | $ 78,219 |
2,018 | 468,465 |
2,019 | 478,667 |
2,020 | 488,870 |
2,021 | 499,072 |
2022 and thereafter | 1,293,167 |
Future minimum rental payments | $ 3,306,460 |
Commitments and Contingencies47
Commitments and Contingencies - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments And Contingencies [Line Items] | |||
Rent expense related to non-cancelable operating leases | $ 473,853 | $ 393,718 | $ 404,438 |
Vendor incentive agreement description | In November 2015, Freshpet entered into an incentive agreement with a vendor. Under the terms of the agreement, a cash incentive will be earned by the vendor upon achievement of certain performance goals that must be reached by the end of the contract term, which expires on November 30, 2017. The incentive payout is based on the fair value of the Company’s common stock price as of the achievement date specified within the contract. As of December 31, 2016, the Company does not believe it is probable that the vendor will reach the performance goals during the term of the contract and accordingly has not provided an accrual for this agreement. However, if the performance goal were deemed probable as of December 31, 2016, the Company would have established an accrual ranging from $305,000 to $1,015,000, depending on the goal achieved. | ||
Vendor incentive agreement date | Nov. 1, 2015 | ||
Performance based incentive expiration date | Nov. 30, 2017 | ||
Minimum | |||
Commitments And Contingencies [Line Items] | |||
Performance based incentive accrual amount | $ 305,000 | ||
Maximum | |||
Commitments And Contingencies [Line Items] | |||
Performance based incentive accrual amount | $ 1,015,000 |
Redeemable Preferred Stock - Ad
Redeemable Preferred Stock - Additional Information (Details) | Nov. 13, 2014USD ($)shares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Temporary Equity [Line Items] | |||||
Common stock share split ratio | 0.7396 | ||||
Cumulative dividends accrued | $ 19,687,856 | ||||
Preferred Stock | |||||
Temporary Equity [Line Items] | |||||
Dividends accrued | $ 0 | $ 0 | |||
IPO | |||||
Temporary Equity [Line Items] | |||||
Debt conversion converted instrument shares issued | shares | 11,067,090 | ||||
Redeemable Preferred Stock Series B | |||||
Temporary Equity [Line Items] | |||||
Dividend rate percentage | 15.00% | ||||
Dividends accrued | 4,271,550 | ||||
Cumulative dividends accrued | $ 23,840,008 | ||||
Redeemable Preferred Stock Series B | IPO | |||||
Temporary Equity [Line Items] | |||||
Redeemed outstanding shares value | $ 34,998,957 | ||||
Redeemable Preferred Stock Series C | |||||
Temporary Equity [Line Items] | |||||
Dividend rate percentage | 8.00% | ||||
Dividends accrued | 7,014,643 | ||||
Cumulative dividends accrued | 12,672,925 | ||||
Loss to common shareholders | 82,654,683 | ||||
Proceeds received | [1] | $ 64,341,539 | |||
Redeemable Preferred Stock Series C | IPO | |||||
Temporary Equity [Line Items] | |||||
Debt conversion converted instrument shares issued | shares | 1,832,531 | ||||
Convertible preferred stock shares issued upon conversion | shares | 2,477,756 | ||||
[1] | Represents the cash proceeds received, net of issuance costs, by the company from Series C investors throughout the life of the security. |
Redeemable Preferred Stock - Su
Redeemable Preferred Stock - Summary of Cumulative Dividends (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2014 | Nov. 13, 2014 | ||
Temporary Equity [Line Items] | |||
Cumulative dividend accretion at December 31, 2013 | $ (19,687,856) | ||
Redeemable Preferred Stock Series C | |||
Temporary Equity [Line Items] | |||
Fair value per Series C share on November 13, 2014 (date of conversion) | $ 166,683,790 | ||
Cash proceeds received, net of issuance costs | [1] | (64,341,539) | |
Cumulative dividend accretion at December 31, 2013 | (12,672,925) | ||
Dividend accretion during 2014 | (7,014,643) | ||
Loss to common shareholders | $ 82,654,683 | ||
[1] | Represents the cash proceeds received, net of issuance costs, by the company from Series C investors throughout the life of the security. |
Warrant - Additional Informatio
Warrant - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Warrants And Rights Note Disclosure [Abstract] | ||
Warrant issued to purchase shares of voting common stock | 61,117 | |
Warrant issued to purchase shares of voting common stock, per share | $ 6.28 | |
Warrant conversion period | 2017-10 | |
Accrued warrants | $ 253,391 | $ 204,314 |
Guarantee Agreement - Additiona
Guarantee Agreement - Additional Information (Details) - USD ($) | Nov. 13, 2014 | Dec. 31, 2016 |
IPO | ||
Guarantee Obligations [Line Items] | ||
Debt conversion converted instrument shares issued | 11,067,090 | |
$62,500,000 Revolving Note Payable | ||
Guarantee Obligations [Line Items] | ||
Debt instrument, face amount | $ 62,500,000 | |
Redeemable Preferred Stock Series C | ||
Guarantee Obligations [Line Items] | ||
Preferred stock, shares issued price | $ 5.25 | |
Redeemable Preferred Stock Series C | IPO | ||
Guarantee Obligations [Line Items] | ||
Convertible preferred stock shares issued upon conversion | 2,477,756 | |
Debt conversion converted instrument shares issued | 1,832,531 | |
Beneficial Owner | ||
Guarantee Obligations [Line Items] | ||
Percentage of contingent fee | 10.00% | |
Percent of voting control | 50.00% |
Equity Incentive Plans - Additi
Equity Incentive Plans - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2016 | Sep. 30, 2016 | Nov. 30, 2014 | Dec. 31, 2010 | Dec. 31, 2006 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Share-based compensation | $ 4,225,149 | $ 3,976,423 | $ 1,563,976 | |||||||
Weighted-Average Grant-Date Fair Value Per Share, Granted | $ 5.09 | $ 7.66 | $ 8.35 | |||||||
Performance Based Options | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Modified from exit event options to performance based options | 657,693 | |||||||||
Number of options, granted | 883,759 | 3,275 | 255,585 | |||||||
Total unrecognized compensation cost | $ 2,248,392 | $ 2,248,392 | $ 2,248,392 | |||||||
Exercisable at end of period, shares | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Reversal of compensation expenses | $ 56,815 | $ 2,573,484 | ||||||||
Performance target ranging start date | Dec. 31, 2017 | |||||||||
Performance target ranging end date | Dec. 31, 2020 | |||||||||
Weighted-Average Grant-Date Fair Value Per Share, Granted | $ 5.19 | $ 7.64 | $ 6.41 | |||||||
Performance Based Options | Incurred in 2017 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | $ 648,843 | |||||||||
Performance Based Options | Incurred in 2018 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | 655,368 | |||||||||
Performance Based Options | Incurred in 2019 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | 471,444 | |||||||||
Restricted Stock Units | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Total unrecognized compensation cost | $ 537,513 | $ 537,513 | 537,513 | |||||||
Restricted Stock Units | Incurred in 2017 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | 302,447 | |||||||||
Restricted Stock Units | Incurred in 2018 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | 173,332 | |||||||||
Restricted Stock Units | Incurred in 2019 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | $ 61,735 | |||||||||
Service Period Stock Options | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Number of options, granted | 845,131 | 3,275 | 255,585 | |||||||
Options exercisable, in the money | 1,274,034 | 1,274,034 | 1,274,034 | |||||||
Total intrinsic value of options exercised | $ 1,467,076 | $ 531,962 | ||||||||
Total unrecognized compensation cost | $ 6,027,096 | $ 6,027,096 | $ 6,027,096 | |||||||
Exercisable at end of period, shares | 1,441,782 | 1,441,782 | 1,441,782 | |||||||
Weighted-Average Grant-Date Fair Value Per Share, Granted | $ 4.97 | $ 7.67 | $ 6.34 | |||||||
Service Period Stock Options | Incurred in 2017 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | $ 2,535,584 | |||||||||
Service Period Stock Options | Incurred in 2018 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | 2,202,286 | |||||||||
Service Period Stock Options | Incurred in 2019 | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Compensation cost recognized during period | $ 841,354 | |||||||||
Service Period Stock Options | CEO | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Vesting period | 4 years | |||||||||
Number of options, granted | 500,000 | |||||||||
Performance-Vested Stock Options | CEO | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Number of options, granted | 500,000 | |||||||||
Exit Event Options | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Modified from exit event options to performance based options | (657,693) | |||||||||
Number of options, granted | 0 | 0 | ||||||||
2006 Stock Plan | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Stock options, number of shares granted | 624,223 | |||||||||
Vesting period | 5 years | |||||||||
Stock options, available for grant | 0 | 0 | 0 | |||||||
2010 Stock Plan | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Stock options, number of shares granted | 2,146,320 | |||||||||
Vesting period | 4 years | |||||||||
Stock options, available for grant | 2,220,280 | |||||||||
2010 Stock Plan | Maximum | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Options granted maximum contractual terms | 10 years | |||||||||
2010 Stock Plan | Performance Based Options | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Vesting period | 2 years | 2 years | ||||||||
Modified from performance-based awards to time -vested awards | 680,753 | |||||||||
Modified from exit event options to performance based options | 657,693 | |||||||||
Modified from performance-based awards to time-based awards | 419,366 | |||||||||
2014 Omnibus Incentive Plan | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Stock options, number of shares granted | 2,500,000 | 1,479,200 | 3,979,200 | |||||||
Vesting period | 3 years | |||||||||
Stock options, available for grant | 2,627,585 | 2,627,585 | 2,627,585 | |||||||
2014 Omnibus Incentive Plan | Restricted Stock Units | Employee | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Vesting period | 3 years | |||||||||
2014 Omnibus Incentive Plan | Restricted Stock Units | Non-employee Director | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Vesting period | 1 year | |||||||||
Cost of Sales | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Share-based compensation | $ 221,559 | $ 201,086 | $ 71,669 | |||||||
Selling, General and Administrative Expenses | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Share-based compensation | 3,971,930 | 3,722,770 | $ 1,492,307 | |||||||
Capital Expenditures | ||||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||||||
Share-based compensation | $ 31,660 | $ 52,566 |
Equity Incentive Plans - Summar
Equity Incentive Plans - Summary of Stock Options Outstanding and Changes under Plans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Service Period Stock Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Outstanding Beginning Balance | 1,976,810 | 2,018,337 | 1,082,740 |
Shares, Granted | 845,131 | 3,275 | 255,585 |
Shares, Modified from Performance Based Options to Service Period Stock Options | 419,366 | 680,753 | |
Shares, Exercised | (424,710) | (44,432) | |
Shares, Forfeited | (12,355) | (370) | (741) |
Shares, Expired | (15,957) | ||
Shares, Outstanding Ending Balance | 2,788,285 | 1,976,810 | 2,018,337 |
Exercisable at end of period, shares | 1,441,782 | ||
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 8 | $ 7.91 | $ 6.91 |
Weighted Average Exercise Price, Granted | 9.75 | 17 | 15 |
Weighted Average Exercise Price, Modified from Performance Based Options to Service Period Stock Options | 7.10 | 7.10 | |
Weighted Average Exercise Price, Exercised | 6.52 | 6.57 | |
Weighted Average Exercise Price, Forfeited | 9.97 | 15 | 6.27 |
Weighted Average Exercise Price, Expired or Cancelled | 8.12 | ||
Weighted Average Exercise Price, Outstanding Ending Balance | 8.61 | $ 8 | $ 7.91 |
Weighted Average Exercise Price, Exercisable | $ 8.01 | ||
Average Remaining Contractual Term, Outstanding | 6 years | ||
Average Remaining Contractual Term, Exercisable | 4 years 4 months 24 days | ||
Aggregate Intrinsic Value, Outstanding | $ 5,553,686 | ||
Aggregate Intrinsic Value, Exercisable | $ 3,897,835 | ||
Performance Based Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Outstanding Beginning Balance | 916,183 | 913,278 | 680,753 |
Shares, Granted | 883,759 | 3,275 | 255,585 |
Shares, Modified from Exit Event Options to Performance Based Options | 657,693 | ||
Shares, Modified from Performance Based Options to Service Period Stock Options | (419,366) | (680,753) | |
Shares, Forfeited | (23,015) | (370) | |
Shares, Outstanding Ending Balance | 1,357,561 | 916,183 | 913,278 |
Exercisable at end of period, shares | 0 | 0 | 0 |
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 9.33 | $ 9.31 | $ 7.10 |
Weighted Average Exercise Price, Granted | 9.67 | 17 | 15 |
Weighted Average Exercise Price, Modified from Exit Event Options to Performance Based Options | 7.10 | ||
Weighted Average Exercise Price, Modified from Performance Based Options to Service Period Stock Options | 7.10 | 7.10 | |
Weighted Average Exercise Price, Forfeited | 9.73 | 15 | |
Weighted Average Exercise Price, Outstanding Ending Balance | $ 10.24 | $ 9.33 | $ 9.31 |
Average Remaining Contractual Term, Outstanding | 8 years 4 months 24 days | ||
Aggregate Intrinsic Value, Outstanding | $ 1,141,801 | ||
Restricted Stock Units | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Outstanding Beginning Balance | 24,166 | ||
Shares, Granted | 105,313 | 24,166 | |
Shares, Issued Upon Vesting | (24,166) | ||
Shares, Forfeited | (7,798) | ||
Shares, Outstanding Ending Balance | 97,515 | 24,166 | |
Weighted-Average Grant-Date Fair Value Per Unit, Outstanding Beginning Balance | $ 15 | ||
Weighted-Average Grant-Date Fair Value Per Unit, Granted | $ 9.05 | $ 15 | |
Weighted-Average Grant-Date Fair Value Per Unit, Issued Upon Vesting | $ 15 | ||
Weighted-Average Grant-Date Fair Value Per Unit, Forfeited | 9.05 | ||
Weighted-Average Grant-Date Fair Value Per Unit, Outstanding Ending Balance | $ 9.05 | $ 15 | |
Exit Event Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares, Outstanding Beginning Balance | 876,924 | ||
Shares, Granted | 0 | 0 | |
Shares, Cancelled | (219,231) | ||
Shares, Modified from Exit Event Options to Performance Based Options | (657,693) | ||
Weighted Average Exercise Price, Outstanding Beginning Balance | $ 7.10 | ||
Weighted Average Exercise Price, Modified from Exit Event Options to Performance Based Options | 7.10 | ||
Weighted Average Exercise Price, Expired or Cancelled | $ 7.10 | ||
Average Remaining Contractual Term, Outstanding | 0 years |
Equity Incentive Plans - Summ54
Equity Incentive Plans - Summary of Nonvested Service Period Stock Options (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Weighted-Average Grant-Date Fair Value Per Share, Granted | $ 5.09 | $ 7.66 | $ 8.35 |
Service Period Stock Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of Options, Nonvested Beginning Balance | 584,213 | 953,772 | 189,234 |
Shares, Granted | 845,131 | 3,275 | 255,585 |
Number of Options, Modified from Performance Based Options to Service Period Stock Options | 419,366 | 680,753 | |
Number of Options, Vested | (489,851) | (372,464) | (171,059) |
Number of Options, Forfeited | (12,355) | (370) | (741) |
Number of Options, Nonvested Ending Balance | 1,346,503 | 584,213 | 953,772 |
Weighted-Average Grant-Date Fair Value Per Share, Nonvested Beginning Balance | $ 8.13 | $ 8.16 | $ 6.02 |
Weighted-Average Grant-Date Fair Value Per Share, Granted | 4.97 | 7.67 | 6.34 |
Weighted Average Grant-Date Fair Value Per Shares, Modified from Performance Based Options to Service Period Stock Options | 4.87 | 8.90 | |
Weighted-Average Grant-Date Fair Value Per Share, Vested | 8.42 | 8.22 | 5.83 |
Weighted-Average Grant-Date Fair Value Per Share, Forfeited | 7.22 | 6.34 | 6.25 |
Weighted-Average Grant-Date Fair Value Per Share, Nonvested Ending Balance | $ 5.04 | $ 8.13 | $ 8.16 |
Performance Based Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of Options, Nonvested Beginning Balance | 916,183 | 913,278 | 680,753 |
Shares, Granted | 883,759 | 3,275 | 255,585 |
Shares, Modified from Exit Event Options to Performance Based Options | 657,693 | ||
Number of Options, Modified from Performance Based Options to Service Period Stock Options | (419,366) | (680,753) | |
Number of Options, Forfeited | (23,015) | (370) | |
Number of Options, Nonvested Ending Balance | 1,357,561 | 916,183 | 913,278 |
Weighted-Average Grant-Date Fair Value Per Share, Nonvested Beginning Balance | $ 8.50 | $ 8.50 | $ 5.85 |
Weighted-Average Grant-Date Fair Value Per Share, Granted | 5.19 | 7.64 | 6.41 |
Weighted-Average Grant-Date Fair Value Per Share, Modified from Exit Event Options to Performance Based Options | 9.31 | ||
Weighted Average Grant-Date Fair Value Per Shares, Modified from Performance Based Options to Service Period Stock Options | 4.87 | (5.85) | |
Weighted-Average Grant-Date Fair Value Per Share, Forfeited | 8.38 | 6.41 | |
Weighted-Average Grant-Date Fair Value Per Share, Nonvested Ending Balance | $ 7.47 | $ 8.50 | $ 8.50 |
Exit Event Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of Options, Nonvested Beginning Balance | 876,924 | ||
Shares, Granted | 0 | 0 | |
Shares, Cancelled | (219,231) | ||
Shares, Modified from Exit Event Options to Performance Based Options | (657,693) | ||
Weighted-Average Grant-Date Fair Value Per Share, Nonvested Beginning Balance | $ 5.85 | ||
Weighted-Average Grant-Date Fair Value Per Share, Modified from Exit Event Options to Performance Based Options | 5.85 | ||
Weighted-Average Grant-Date Fair Value Per Share, Cancelled | $ 5.85 |
Equity Incentive Plans - Expect
Equity Incentive Plans - Expected Dividend Yield Valuation Model (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected volatility | 45.60% | 41.90% | |
Risk-free interest rate | 1.60% | ||
Risk-free interest rate, minimum | 1.26% | 1.01% | |
Risk-free interest rate, maximum | 1.36% | 2.09% | |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Minimum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected volatility | 52.60% | ||
Average expected terms in years | 5 years 3 months 18 days | 5 years 4 months 24 days | 3 years 10 months 24 days |
Maximum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected volatility | 53.20% | ||
Average expected terms in years | 7 years 2 months 12 days | 6 years 4 months 24 days | 6 years 7 months 6 days |
Net Loss Attributable to Comm56
Net Loss Attributable to Common Stockholders - Schedule of Net Income Attributable to Common Stockholders (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | [1] | Sep. 30, 2015 | [1] | Jun. 30, 2015 | [1] | Mar. 31, 2015 | [1] | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||
Earnings Per Share Basic [Line Items] | |||||||||||||||||||||||
Net loss | $ 1,233,400 | $ 620,730 | $ (3,243,002) | $ (1,771,802) | $ 2,780,262 | $ (1,675,350) | $ (2,228,650) | $ (2,587,074) | $ (16,446,750) | $ (9,483,241) | $ (6,266,803) | $ (5,142,223) | $ (3,160,673) | $ (3,710,812) | $ (37,339,017) | ||||||||
Net loss attributable to common stockholders | $ 1,233,400 | $ 620,730 | $ (3,243,002) | $ (1,771,802) | $ 2,780,262 | $ (1,675,350) | $ (2,228,650) | $ (2,587,074) | $ (100,642,922) | [2] | $ (12,380,254) | [2] | $ (10,771,077) | [2] | $ (7,485,640) | [2] | $ (3,160,673) | $ (3,710,812) | (131,279,893) | ||||
Series B and Series C Preferred Stock | |||||||||||||||||||||||
Earnings Per Share Basic [Line Items] | |||||||||||||||||||||||
Preferred stock dividends on Series B and Series C | (11,286,193) | ||||||||||||||||||||||
Convertible Preferred Series C | |||||||||||||||||||||||
Earnings Per Share Basic [Line Items] | |||||||||||||||||||||||
Additional loss attributable to common stockholders upon conversion of Series C Preferred Stock into common stock | $ (82,654,683) | ||||||||||||||||||||||
[1] | Fourth quarter 2015 results include the reversal of $2.6 million of stock-based compensation expense related to performance-based awards. See Note 12. | ||||||||||||||||||||||
[2] | See note 9 for further detail regarding the dividend accretion that is included within net loss attributable to common stockholders. |
Net Loss Attributable to Comm57
Net Loss Attributable to Common Stockholders - Schedule of Potentially Dilutive Securities Excluded from Determination of Diluted Loss per Share, as Their Effect is Antidilutive (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive Securities | 2,426,024 | 2,052,326 | 1,281,856 |
Service Period Stock Options | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive Securities | 2,299,468 | 1,991,209 | 1,220,739 |
Restricted Stock Units | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive Securities | 65,439 | ||
Warrants | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive Securities | 61,117 | 61,117 | 61,117 |
Retirement Plan - Additional In
Retirement Plan - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Company contribution amount | $ 497,731 | $ 380,357 | $ 307,754 |
Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Active participants contributions percentage | 50.00% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Purchases of Raw Materials | |||
Related Party Transaction [Line Items] | |||
Payments made to a stockholder for distribution services | $ 6,565,384 | $ 6,068,038 | $ 5,545,835 |
Concentrations - Additional Inf
Concentrations - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2016USD ($)Customervendors | Dec. 31, 2015Customervendors | Dec. 31, 2014Customervendors | |
Customer Concentration Risk | Sales Revenue Net | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 23.00% | 22.00% | 22.00% |
Number of customers | Customer | 3 | 3 | 3 |
Supplier Concentration Risk | Purchases of Raw Materials | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 23.00% | 34.00% | 54.00% |
Number of vendors | 1 | 2 | 3 |
Supplier Concentration Risk | Finished Goods | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 89.00% | 90.00% | 96.00% |
Number of vendors | 4 | 3 | 3 |
Supplier Concentration Risk | Packaging Materials | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 84.00% | 64.00% | 74.00% |
Number of vendors | 3 | 3 | 3 |
Customer One | Customer Concentration Risk | Sales Revenue Net | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 10.00% | 10.00% | 10.00% |
Number of customers | Customer | 0 | 1 | 0 |
Maximum | |||
Concentration Risk [Line Items] | |||
Cash, FDIC insured amount | $ | $ 250,000 |
Concentrations - Net Sales by C
Concentrations - Net Sales by Class of Retail (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Concentration Risk [Line Items] | ||||||||||||||||
Net Sales | $ 34,061,456 | $ 34,536,151 | $ 33,002,209 | $ 31,453,700 | $ 30,201,788 | $ 30,570,506 | $ 28,359,404 | $ 27,054,674 | $ 24,508,205 | $ 22,519,672 | $ 20,386,038 | $ 19,350,197 | $ 133,053,517 | $ 116,186,372 | $ 86,764,112 | |
Grocery, Mass and Club | ||||||||||||||||
Concentration Risk [Line Items] | ||||||||||||||||
Net Sales | 104,708,513 | 89,131,925 | 65,212,966 | |||||||||||||
Pet Specialty, Natural and Other | ||||||||||||||||
Concentration Risk [Line Items] | ||||||||||||||||
Net Sales | [1] | $ 28,345,003 | $ 27,054,447 | $ 21,551,146 | ||||||||||||
[1] | Other sales represent less than 1% of net sales |
Concentrations - Net Sales by62
Concentrations - Net Sales by Class of Retail (Parenthetical) (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Maximum | |
Concentration Risk [Line Items] | |
Percentage of other sales in net sales | 1.00% |
Unaudited Quarterly Results - S
Unaudited Quarterly Results - Schedule of Unaudited Quarterly Results (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||||||||
Net Sales | $ 34,061,456 | $ 34,536,151 | $ 33,002,209 | $ 31,453,700 | $ 30,201,788 | $ 30,570,506 | $ 28,359,404 | $ 27,054,674 | $ 24,508,205 | $ 22,519,672 | $ 20,386,038 | $ 19,350,197 | $ 133,053,517 | $ 116,186,372 | $ 86,764,112 | ||||||||
Income/(loss) from operations | 1,550,989 | 808,196 | (2,974,942) | (1,599,195) | 2,868,688 | (2,013,698) | (2,078,083) | (2,424,578) | 550,551 | (1,338,419) | 3,328,420 | (2,301,404) | (2,214,950) | (3,647,672) | (6,080,316) | ||||||||
Net Income/(loss) | 1,233,400 | 620,730 | (3,243,002) | (1,771,802) | 2,780,262 | [1] | (1,675,350) | [1] | (2,228,650) | [1] | (2,587,074) | [1] | (16,446,750) | (9,483,241) | (6,266,803) | (5,142,223) | (3,160,673) | (3,710,812) | (37,339,017) | ||||
Net Income/(loss) attributable to common stockholders | $ 1,233,400 | $ 620,730 | $ (3,243,002) | $ (1,771,802) | $ 2,780,262 | [1] | $ (1,675,350) | [1] | $ (2,228,650) | [1] | $ (2,587,074) | [1] | $ (100,642,922) | [2] | $ (12,380,254) | [2] | $ (10,771,077) | [2] | $ (7,485,640) | [2] | $ (3,160,673) | $ (3,710,812) | $ (131,279,893) |
Basic earnings/(loss) per common share | $ 0.04 | $ 0.02 | $ (0.10) | $ (0.05) | $ 0.08 | $ (0.05) | $ (0.07) | $ (0.08) | $ (4.35) | $ (1.19) | $ (0.77) | $ (0.53) | $ (0.09) | $ (0.11) | $ (9.63) | ||||||||
Diluted earnings/(loss) per common share | $ 0.04 | $ 0.02 | $ (0.10) | $ (0.05) | $ 0.08 | $ (0.05) | $ (0.07) | $ (0.08) | $ (4.35) | $ (1.19) | $ (0.77) | $ (0.53) | $ (0.09) | $ (0.11) | $ (9.63) | ||||||||
[1] | Fourth quarter 2015 results include the reversal of $2.6 million of stock-based compensation expense related to performance-based awards. See Note 12. | ||||||||||||||||||||||
[2] | See note 9 for further detail regarding the dividend accretion that is included within net loss attributable to common stockholders. |
Unaudited Quarterly Results -64
Unaudited Quarterly Results - Schedule of Unaudited Quarterly Results (Parenthetical) (Details) $ in Millions | 3 Months Ended |
Dec. 31, 2015USD ($) | |
Performance-Based Awards | |
Quarterly Financial Data [Line Items] | |
Reversal of compensation expenses | $ 2.6 |