Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2021 | May 11, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-32501 | |
Entity Registrant Name | REED’S, INC. | |
Entity Central Index Key | 0001140215 | |
Entity Tax Identification Number | 35-2177773 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 201 Merritt 7 | |
Entity Address, City or Town | Norwalk | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06851 | |
City Area Code | (800) | |
Local Phone Number | 997-3337 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | REED | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 93,584,380 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 155 | $ 595 |
Accounts receivable, net of allowance for doubtful accounts and returns and discounts of $165 and $234, respectively | 5,032 | 4,718 |
Receivable from related party | 701 | 682 |
Inventory, net of reserve for obsolescence of $174 and $194, respectively | 12,445 | 11,119 |
Prepaid expenses and other current assets | 2,110 | 1,341 |
Total current assets | 20,443 | 18,455 |
Property and equipment, net of accumulated depreciation of $379 and $361, respectively | 949 | 920 |
Equipment held for sale, net of impairment reserves of $96 and $96, respectively | 67 | 67 |
Intangible assets | 617 | 615 |
Total assets | 22,076 | 20,057 |
Current liabilities: | ||
Accounts payable | 8,134 | 6,746 |
Payable to related party | 1,034 | 557 |
Accrued expenses | 449 | 895 |
Revolving line of credit | 4,256 | |
Current portion of note payable | 727 | 599 |
Current portion of leases payable | 145 | 130 |
Total current liabilities | 14,745 | 8,927 |
Leases payable, less current portion | 518 | 555 |
Note payable, less current portion | 43 | 171 |
Warrant liability | ||
Total liabilities | 15,306 | 9,653 |
Stockholders’ equity: | ||
Series A Convertible Preferred stock, $10 par value, 500,000 shares authorized, 9,411 shares issued and outstanding | 94 | 94 |
Common stock, $.0001 par value, 120,000,000 shares authorized, 86,807,905 and 86,317,096 shares issued and outstanding, respectively | 9 | 9 |
Additional paid in capital | 97,904 | 97,031 |
Accumulated deficit | (91,237) | (86,730) |
Total stockholders’ equity | 6,770 | 10,404 |
Total liabilities and stockholders’ equity | $ 22,076 | $ 20,057 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowance | $ 165 | $ 234 |
Inventory Valuation Reserves | 174 | 194 |
Property and equipment, accumulated depreciation | 379 | 361 |
Equipment, impairment reserves | $ 96 | $ 96 |
Series A convertible preferred stock, par value | $ 10 | $ 10 |
Series A convertible preferred stock, shares authorized | 500,000 | 500,000 |
Series A convertible preferred stock, shares issued | 9,411 | 9,411 |
Series A convertible preferred stock, shares outstanding | 9,411 | 9,411 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares issued | 86,807,905 | 86,317,096 |
Common stock, shares outstanding | 86,807,905 | 86,317,096 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Net Sales | $ 12,146 | $ 9,523 |
Cost of goods sold | 8,293 | 6,653 |
Gross profit | 3,853 | 2,870 |
Operating expenses: | ||
Delivery and handling expense | 3,286 | 1,263 |
Selling and marketing expense | 2,215 | 1,925 |
General and administrative expense | 2,603 | 1,932 |
Total operating expenses | 8,104 | 5,120 |
Loss from operations | (4,251) | (2,250) |
Interest expense | (256) | (336) |
Change in fair value of warrant liability | 6 | |
Net loss | $ (4,507) | $ (2,580) |
Net loss per share – basic and diluted | $ (0.05) | $ (0.05) |
Weighted average number of shares outstanding – basic and diluted | 86,631,304 | 47,595,206 |
Condensed Statements of Changes
Condensed Statements of Changes in Stockholders' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Preferred Stock [Member] | Common Stock Issuable [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 5 | $ 94 | $ 77,596 | $ (76,548) | $ 1,147 | |
Beginning balance at Dec. 31, 2019 | 47,595,206 | 9,411 | ||||
Fair value of vested options | 495 | 495 | ||||
Fair value of vested restricted shares granted to an officer | $ 285 | 285 | ||||
Fair value of vested restricted shares granted to a former officer for services, shares | 350,000 | |||||
Net loss | (2,580) | (2,580) | ||||
Ending balance, value at Mar. 31, 2020 | $ 5 | $ 94 | $ 285 | 78,091 | (79,128) | (653) |
Ending balance at Mar. 31, 2020 | 47,595,206 | 9,411 | 350,000 | |||
Beginning balance, value at Dec. 31, 2020 | $ 9 | $ 94 | 97,031 | (86,730) | 10,404 | |
Beginning balance at Dec. 31, 2020 | 86,317,096 | 9,411 | ||||
Fair value of vested options | 300 | 300 | ||||
Fair value of vested restricted shares granted to an officer | 98 | 98 | ||||
Fair value of vested restricted shares granted to a former officer for services, shares | 84,809 | |||||
Common shares issued on exercise of options | 3 | $ 3 | ||||
Common shares issued on exercise of options, shares | 6,000 | 6,000 | ||||
Common shares issued for financing costs | 472 | $ 472 | ||||
Common shares issued for financing costs, shares | 400,000 | |||||
Net loss | (4,507) | (4,507) | ||||
Ending balance, value at Mar. 31, 2021 | $ 9 | $ 94 | $ 97,904 | $ (91,237) | $ 6,770 | |
Ending balance at Mar. 31, 2021 | 86,807,905 | 9,411 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (4,507) | $ (2,580) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 32 | 12 |
Gain on sale on termination of leases | (3) | |
Amortization of debt discount | 162 | 96 |
Amortization of prepaid financing costs | 25 | |
Amortization of right of use assets | 24 | 37 |
Fair value of vested options | 292 | 495 |
Fair value of vested restricted shares granted to officers | 106 | 285 |
Decrease in allowance for doubtful accounts | (69) | (93) |
Decrease in inventory reserve | (20) | (384) |
Change in fair value of warrant liability | (6) | |
Accrual of interest on convertible note to a related party | 142 | |
Lease liability | (8) | (7) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (244) | (1,826) |
Inventory | (1,306) | 2,902 |
Prepaid expenses and other assets | (484) | (365) |
Accounts payable | 1,387 | (1,038) |
Accrued expenses | (446) | (22) |
Net cash used in operating activities | (5,059) | (2,352) |
Cash flows from investing activities: | ||
Patent costs | (2) | |
Purchase of property and equipment | (95) | (22) |
Net cash used in investing activities | (97) | (22) |
Cash flows from financing activities: | ||
Borrowings on line of credit | 16,154 | 9,188 |
Repayments of line of credit | (11,898) | (7,677) |
Amounts from related party | 459 | |
Principal repayments on capital lease obligation | (2) | (22) |
Exercise of options | 3 | |
Net cash provided by financing activities | 4,716 | 1,489 |
Net increase (decrease) in cash | (440) | (885) |
Cash at beginning of period | 595 | 913 |
Cash at end of period | 155 | 28 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | $ 70 | $ 98 |
Basis of Presentation and Liqui
Basis of Presentation and Liquidity | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Liquidity | 1. Basis of Presentation and Liquidity The accompanying interim condensed financial statements of Reed’s, Inc. (the “Company”, “we”, “us”, or “our”), are unaudited, but in the opinion of management contain all adjustments, including normal recurring adjustments, necessary to present fairly our financial position at March 31, 2021 and the results of operations and cash flows for the three months ended March 31, 2021 and 2020. The balance sheet as of December 31, 2020 is derived from the Company’s audited financial statements. Certain information and footnote disclosures normally included in financial statements that have been prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. We believe that the disclosures contained in these condensed financial statements are adequate to make the information presented herein not misleading. For further information, refer to the financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, as filed with the Securities and Exchange Commission on March 30, 2021. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2021. COVID-19 Considerations During the period ended March 31, 2021, the COVID-19 pandemic has impacted our operating results and the Company anticipates a continued impact for the balance of the year. In addition, the pandemic may cause reduced demand for our products if, for example, the pandemic results in a recessionary economic environment which negatively effects the consumers who purchase our products. Based on the recent increase in demand for our products, we believe that over the long term, there will continue to be strong demand for our products. Through March 31, 2021, the Company has experienced higher transportation expenses as the capacity in the freight market has not kept up with demand. The Company believes that costs will continue to increase throughout the year. However, mitigation plans are being implemented to manage this risk. Our ability to operate without significant incremental negative operational impact from the COVID-19 pandemic will in part depend on our ability to protect our employees and our supply chain. The Company has endeavored to follow the recommended actions of government and health authorities to protect our employees. Since the inception of the COVID-19 pandemic and through March 31, 2021, we maintained the consistency of our operations during the onset of the COVID-19 pandemic. We will continue to innovate in managing our business, coordinating with our employees and suppliers to do our part in the infection prevention and remain flexible in responding to our customers and suppliers. However, the uncertainty resulting from the pandemic could result in an unforeseen disruption to our workforce and supply chain (for example an inability of a key supplier or transportation supplier to source and transport materials) that could negatively impact our operations. Net sales for the period ended March 31, 2021 were up 28% from the prior year period. Through March 31, 2021, we continue to generate cash flows to meet our short-term liquidity needs, and we expect to maintain access to the capital markets. We have also not observed any material impairments of our assets or a significant change in the fair value of our assets due to the COVID-19 pandemic. Liquidity The accompanying financial statements have been prepared under the assumption that the Company will continue as a going concern. Such assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the three months ended March 31, 2021, the Company recorded a net loss of $ 4,507 5,059 155 2,513 6,770 5,698 595 5,166 10,404 9,528 Historically, we have financed our operations through public and private sales of common stock, issuance of preferred and common stock, convertible debt instruments, term loans and credit lines from financial institutions, and cash generated from operations. We have taken decisive action to improve our margins, including fully outsourcing our manufacturing process, streamlining our product portfolio, negotiating improved vendor contracts and restructuring our selling prices. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Those estimates and assumptions include estimates for reserves of uncollectible accounts, inventory obsolescence, depreciable lives of property and equipment, analysis of impairments of recorded long-term tangible and intangible assets, realization of deferred tax assets, accruals for potential liabilities and assumptions made in valuing stock instruments issued for services. Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers The Company does not have any significant contracts with customers requiring performance beyond delivery, and contracts with customers contain no incentives or discounts that could cause revenue to be allocated or adjusted over time. Shipping and handling activities are performed before the customer obtains control of the goods and therefore represent a fulfillment activity rather than a promised service to the customer. Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs upon shipment from our facilities. The Company’s performance obligations are satisfied at that time. All of the Company’s products are offered for sale as finished goods only, and there are no performance obligations required post-shipment for customers to derive the expected value from them. The Company does not allow for returns, except for damaged products when the damage occurred pre-fulfillment. Damaged product returns have historically been insignificant. Because of this, the stand-alone nature of our products, and our assessment of performance obligations and transaction pricing for our sales contracts, we do not currently maintain a contract asset or liability balance for obligations. We assess our contracts and the reasonableness of our conclusions on a quarterly basis. Loss per Common Share Basic earnings (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed by dividing the net income applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation when their effect is antidilutive. For the periods ended March 31, 2021 and 2020, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: Schedule of Potentially Dilutive Securities March 31, 2021 March 31, 2020 Convertible note to a related party - 2,266,667 Warrants 3,362,241 6,413,782 Common stock equivalent of Series A Convertible Preferred stock 37,644 37,644 Common stock issuable 350,000 Unvested restricted common stock 309,082 150,000 Options 11,028,322 4,683,380 Total 14,737,289 13,901,473 The Series A Convertible Preferred Stock is convertible into Common shares at the rate of 1:4. Stock Compensation Expense The Company periodically issues stock options and restricted stock awards to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on ASC 718, Compensation-Stock Compensation The fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. Advertising Costs Advertising costs are expensed as incurred and are included in selling and marketing expense. Advertising costs aggregated $ 349 302 Concentrations Gross sales. 23 12 22 14 10 Accounts receivable. 18 10 23 10 Purchases from vendors. 13 13 10 10 Accounts payable. 19 10 12 10 10 Fair Value of Financial Instruments The Company uses various inputs in determining the fair value of its financial assets and liabilities and measures these assets on a recurring basis. Financial assets recorded at fair value are categorized by the level of subjectivity associated with the inputs used to measure their fair value. ASC 820 defines the following levels of subjectivity associated with the inputs: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable, short-term bank loans, accounts payable, notes payable and other payables, approximate their fair values because of the short maturity of these instruments. The carrying values of capital lease obligations and long-term financing obligations approximate their fair values because interest rates on these obligations are based on prevailing market interest rates. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40).” ASU 2020-06 reduces the number of accounting models for convertible debt instruments by eliminating the cash conversion and beneficial conversion models. The diluted net income per share calculation for convertible instruments will require the Company to use the if-converted method. For contracts in an entity’s own equity, the type of contracts primarily affected by this update are freestanding and embedded features that are accounted for as derivatives under the current guidance due to a failure to meet the settlement conditions of the derivative scope exception. This update simplifies the related settlement assessment by removing the requirements to (i) consider whether the contract would be settled in registered shares, (ii) consider whether collateral is required to be posted, and (iii) assess shareholder rights. ASU 2020-06 is effective January 1, 2024, for the Company and the provisions of this update can be adopted using either the modified retrospective method or a fully retrospective method. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. Effective January 1, 2021, the Company early adopted ASU 2020-06 and that adoption did not have an impact on our financial statements and related disclosures. Other recent accounting pronouncements issued by the FASB, its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventory | 3. Inventory Inventory is valued at the lower of cost (first-in, first-out) or net realizable value, and net of reserves is comprised of the following (in thousands): Schedule of Inventory March 31, 2021 December 31, 2020 Raw materials and packaging $ 7,746 $ 6,793 Finished products 4,699 4,326 Total $ 12,445 $ 11,119 The Company has recorded a reserve for slow moving and potentially obsolete inventory. The reserve at March 31, 2021, and December 31, 2020, was $ 174 194 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 4. Property and Equipment Property and equipment is comprised of the following (in thousands): Schedule of Property and Equipment March 31, 2021 December 31, 2020 Right-of-use assets under operating leases $ 724 $ 724 Right-of-use assets under finance leases 6 54 Computer hardware and software 400 400 Machinery and equipment 198 103 Total cost 1,328 1,281 Accumulated depreciation and amortization (379 ) (361 ) Net book value $ 949 $ 920 Depreciation expense for the three months ended March 31, 2021 and 2020 was $ 32 12 24 37 48 38 13 Equipment held for sale consists of the following (in thousands): Schedule of Equipment Held for Sale March 31, 2021 December 31, 2020 Equipment held for sale $ 163 $ 163 Reserve (96 ) (96 ) Net book value $ 67 $ 67 The balance as of March 31, 2021, and December 31, 2020, consists of residual manufacturing equipment, at estimated net realizable value, which management anticipates selling during 2021. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 5. Intangible Assets Intangible assets are comprised of brand names acquired, specifically Virgil’s, and costs related to trademarks. They have been assigned an indefinite life, as we currently anticipate that they will contribute cash flows to the Company perpetually. These indefinite-lived intangible assets are not amortized but are assessed for impairment annually and evaluated annually to determine whether the indefinite useful life remains appropriate. We first assess qualitative factors to determine whether it is more likely than not that the asset is impaired. If further testing is necessary, we compare the estimated fair value of our asset with its book value. If the carrying amount of the asset exceeds its fair value, as determined by the discounted cash flows expected to be generated by the asset, an impairment loss is recognized in an amount equal to that excess. Based on management’s assessment, there were no During the three months ended March 31, 2021, the Company capitalized costs of $ 2 Intangible assets consist of the following (in thousands): Summary of Intangible Assets March 31, 2021 December 31, 2020 Brand names $ 576 $ 576 Trademarks 41 39 Total $ 617 $ 615 |
Line of Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Line of Credit | 6. Line of Credit Amounts outstanding under the Company’s credit facilities are as follows (in thousands): Schedule of Amount Outstanding Under Credit Facilities March 31, 2021 December 31, 2020 Line of credit $ 4,256 $ - On October 4, 2018, the Company entered into a financing agreement with Rosenthal & Rosenthal, Inc. The financing agreement provides a maximum borrowing capacity of $ 13,000 4,000 2,513 March 30, 2021 Borrowings under the Rosenthal financing agreement bear interest at the greater of prime or 4.75 2.0 3.5 4 The line of credit is secured by substantially all of the assets, excluding intellectual property, of the Company. The over-advance is secured by all of Reed’s intellectual property collateral. Additionally, any over-advance was guaranteed by an irrevocable stand-by letter of credit in the amount of $ 1,500 On March 11, 2021, the Company entered into an amendment to the financing agreement, releasing that irrevocable standby letter of credit of $1,500 by Raptor with a $2,000 pledge of securities to Rosenthal by John J. Bello and Nancy E. Bello, as Co-Trustees of The John and Nancy Bello Revocable Living Trust. John J. Bello, current Chairman and former Interim Chief Executive Officer of Reed’s, is a related party. He is also a greater than 5 400,000 472 25 The financing agreement with Rosenthal includes customary restrictions that limit our ability to engage in certain types of transactions, including our ability to utilize tangible and intangible assets as collateral for other indebtedness. Additionally, the agreement contains a financial covenant that requires us to meet certain minimum working capital and tangible net worth thresholds as of the end of each quarter. We were in compliance with the terms of our agreement with Rosenthal as of March 31, 2021. The Company annually incurs an additional $ 130 1 13,000 162 162 96 no |
Note Payable
Note Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Note Payable | 7. Note Payable On April 20, 2020, the Company was granted a loan (the “PPP loan”) from City National Bank in the aggregate amount of $ 770 770 599 770 727 The PPP loan agreement is dated April 20, 2020, matures on April 20, 2022 1 Debt If the conditions outlined in the PPP loan program are adhered to by the Company, all or part of such loan could be forgiven. The Company believes that all or a substantial portion of the PPP loan is eligible for forgiveness. The Company applied for full forgiveness of the PPP loan on March 17, 2021. As for the potential loan forgiveness, once the PPP loan is, in part or wholly, forgiven and a legal release is received, the liability would be reduced by the amount forgiven and a gain on extinguishment would be recorded. However, the Company cannot provide any assurance whether the PPP loan will ultimately be forgiven by the SBA. |
Leases Liabilities
Leases Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases Liabilities | 8. Leases Liabilities The Company accounts for leases under ASC 842, Leases ASC 842 requires recognition in the statement of operations of a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis. During the three months ended March 31, 2021, the Company reflected amortization of right of use asset of $ 24 730 In accordance with ASC 842, the right-of-use assets are being amortized over the life of the underlying leases. As of December 31, 2020, lease liabilities totaled $ 685 16 669 13 2 8 663 1 662 As of March 31, 2021, the weighted average remaining lease terms for operating lease and finance lease are 3.76 0.50 12.6 12.6 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 9. Stock-Based Compensation Restricted common stock The following table summarizes restricted stock activity during the three months ended March 31, 2021: Summary of Non-vested Restricted Stock Activity Unvested Issuable Fair Value Weighted Balance, December 31, 2020 150,000 - $ 92 0.89 Granted 245,900 - 226 0.92 Vested (84,809 ) 84,809 - - Forfeited (2,009 ) 0.89 Issued - (84,809 ) (98 ) - Balance, March 31, 2021 309,082 - $ 220 $ 0.89 On January 26, 2021, the board of directors of Reed’s, pursuant to a joint recommendation from its governance and compensation committees, set the cash compensation of its non-employee directors at $ 50,000 245,900 61,475 184,425 226 0.92 The total fair value of restricted common stock vesting during the three months ended March 31, 2021 and 2020 was $ 98 and $ 285 , respectively, and is included in general and administrative expenses in the accompanying statements of operations. As of March 31, 2021, the amount of unvested compensation related to issuances of restricted common stock was $ 220 , which will be recognized as an expense in future periods as the shares vest. When calculating basic loss per share, these shares are included in weighted average common shares outstanding from the time they vest. When calculating diluted net income per share, these shares are included in weighted average common shares outstanding as of their grant date. Stock options The following table summarizes stock option activity during the three months ended March 31, 2021: Schedule of Stock Option Activity Shares Weighted- Weighted- Aggregate Outstanding at December 31, 2020 9,417,898 $ 1.45 6.09 $ 78 Granted 1,939,700 $ 1.01 Exercised (6,000 ) $ 0.50 Unvested forfeited (315,526 ) $ 1.75 Vested forfeited (7,750 ) $ 2.51 Outstanding at March 31, 2021 11,028,322 $ 1.15 8.61 $ 2,332 Exercisable at March 31, 2021 3,160,048 $ 1.34 6.76 $ 759 During the three months ended March 31, 2021, the Company received proceeds of $ 3 6,000 During the three months ended March 31, 2021, the Company approved options exercisable into 1,939,700 1,939,700 969,850 four 969,850 The stock options are exercisable at a price of $ 1.01 ten years 1,294 six years 76 0 0.94 During the three months ended March 31, 2021 and 2020, the Company recognized $ 300 and $ 495 of compensation expense relating to vested stock options. As of March 31, 2021, the aggregate amount of unvested compensation related to stock options was approximately $ 4,274 which will be recognized as an expense as the options vest in future periods through March 28, 2025. As of March 31, 2021, the outstanding and exercisable options have an intrinsic value of $ 2,332 759 1.17 |
Stock Warrants
Stock Warrants | 3 Months Ended |
Mar. 31, 2021 | |
Stock Warrants | |
Stock Warrants | 10. Stock Warrants As of March 31, 2021, the Company has issued warrants to purchase an aggregate of 3,362,241 Schedule of Warrant Activity Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Terms (Years) Aggregate Intrinsic Value Outstanding at December 31, 2020 3,362,241 $ 1.56 2.49 $ - Exercised - - Forfeited - - Outstanding at March 31, 2021 3,362,241 $ 1.56 2.24 $ 526 Exercisable at March 31, 2021 3,362,241 $ 1.56 2.24 $ 526 There were no 526 1.17 |
Related Party Activities
Related Party Activities | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Activities | 11. Related Party Activities On December 31, 2018, the Company completed the sale of its Los Angeles manufacturing plant to California Custom Beverage, LLC (“CCB”), an entity owned by Christopher J. Reed, a related party, and CCB assumed the monthly payments on our lease obligation for the Los Angeles manufacturing plant. Our release from the obligation by the lessor, however, is dependent upon CCB’s deposit of $ 1,200 800 363,000 425 Beginning in 2019, we are to receive a 5 5 3 5 At December 31, 2020, the Company had an aggregate receivable balance from CCB of $ 682 3 16 701 At March 31, 2021 and December 31, 2020, the Company had accounts payable due to CCB of $ 557 1,034 Lindsay Martin, daughter of a director of the Company, is employed as Vice President of Marketing. Ms. Martin was paid approximately $ 87 42 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events On May 5, 2021, the Company entered into a placement agency agreement with Roth Capital Partners, LLC (the “Placement Agent”) and a securities purchase agreement with a certain purchaser for the purchase and sale of shares of the Company’s common stock, par value $ 0.0001 6,680,000 1.18 The offering closed on May 7, 2021 For a period of 90 days after the closing date of the sale of the shares of common stock, the provisions of the securities purchase agreement generally prohibit the Company from issuing or agreeing to issue shares of common stock or common stock equivalents other than under equity compensation plans, outstanding rights to acquire common stock or common stock equivalents, or in connection with certain acquisitions or strategic transactions. The placement agency agreement provides that the Company will indemnify the Placement Agent against certain liabilities, including liabilities under the Securities Act of 1933, as amended. The Placement Agent agreed to use reasonable best efforts to arrange for the sale of the shares of common stock being issued and sold in the Offering. The Placement Agent will be paid a total cash fee at the closing of the Offering equal to 6.5% of the gross cash proceeds received by the Company from the sale of the shares of common stock in the offering. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Use of estimates | Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Those estimates and assumptions include estimates for reserves of uncollectible accounts, inventory obsolescence, depreciable lives of property and equipment, analysis of impairments of recorded long-term tangible and intangible assets, realization of deferred tax assets, accruals for potential liabilities and assumptions made in valuing stock instruments issued for services. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers The Company does not have any significant contracts with customers requiring performance beyond delivery, and contracts with customers contain no incentives or discounts that could cause revenue to be allocated or adjusted over time. Shipping and handling activities are performed before the customer obtains control of the goods and therefore represent a fulfillment activity rather than a promised service to the customer. Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs upon shipment from our facilities. The Company’s performance obligations are satisfied at that time. All of the Company’s products are offered for sale as finished goods only, and there are no performance obligations required post-shipment for customers to derive the expected value from them. The Company does not allow for returns, except for damaged products when the damage occurred pre-fulfillment. Damaged product returns have historically been insignificant. Because of this, the stand-alone nature of our products, and our assessment of performance obligations and transaction pricing for our sales contracts, we do not currently maintain a contract asset or liability balance for obligations. We assess our contracts and the reasonableness of our conclusions on a quarterly basis. |
Loss per Common Share | Loss per Common Share Basic earnings (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed by dividing the net income applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation when their effect is antidilutive. For the periods ended March 31, 2021 and 2020, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: Schedule of Potentially Dilutive Securities March 31, 2021 March 31, 2020 Convertible note to a related party - 2,266,667 Warrants 3,362,241 6,413,782 Common stock equivalent of Series A Convertible Preferred stock 37,644 37,644 Common stock issuable 350,000 Unvested restricted common stock 309,082 150,000 Options 11,028,322 4,683,380 Total 14,737,289 13,901,473 The Series A Convertible Preferred Stock is convertible into Common shares at the rate of 1:4. |
Stock Compensation Expense | Stock Compensation Expense The Company periodically issues stock options and restricted stock awards to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on ASC 718, Compensation-Stock Compensation The fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and are included in selling and marketing expense. Advertising costs aggregated $ 349 302 |
Concentrations | Concentrations Gross sales. 23 12 22 14 10 Accounts receivable. 18 10 23 10 Purchases from vendors. 13 13 10 10 Accounts payable. 19 10 12 10 10 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company uses various inputs in determining the fair value of its financial assets and liabilities and measures these assets on a recurring basis. Financial assets recorded at fair value are categorized by the level of subjectivity associated with the inputs used to measure their fair value. ASC 820 defines the following levels of subjectivity associated with the inputs: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable, short-term bank loans, accounts payable, notes payable and other payables, approximate their fair values because of the short maturity of these instruments. The carrying values of capital lease obligations and long-term financing obligations approximate their fair values because interest rates on these obligations are based on prevailing market interest rates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40).” ASU 2020-06 reduces the number of accounting models for convertible debt instruments by eliminating the cash conversion and beneficial conversion models. The diluted net income per share calculation for convertible instruments will require the Company to use the if-converted method. For contracts in an entity’s own equity, the type of contracts primarily affected by this update are freestanding and embedded features that are accounted for as derivatives under the current guidance due to a failure to meet the settlement conditions of the derivative scope exception. This update simplifies the related settlement assessment by removing the requirements to (i) consider whether the contract would be settled in registered shares, (ii) consider whether collateral is required to be posted, and (iii) assess shareholder rights. ASU 2020-06 is effective January 1, 2024, for the Company and the provisions of this update can be adopted using either the modified retrospective method or a fully retrospective method. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. Effective January 1, 2021, the Company early adopted ASU 2020-06 and that adoption did not have an impact on our financial statements and related disclosures. Other recent accounting pronouncements issued by the FASB, its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Potentially Dilutive Securities | For the periods ended March 31, 2021 and 2020, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: Schedule of Potentially Dilutive Securities March 31, 2021 March 31, 2020 Convertible note to a related party - 2,266,667 Warrants 3,362,241 6,413,782 Common stock equivalent of Series A Convertible Preferred stock 37,644 37,644 Common stock issuable 350,000 Unvested restricted common stock 309,082 150,000 Options 11,028,322 4,683,380 Total 14,737,289 13,901,473 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory is valued at the lower of cost (first-in, first-out) or net realizable value, and net of reserves is comprised of the following (in thousands): Schedule of Inventory March 31, 2021 December 31, 2020 Raw materials and packaging $ 7,746 $ 6,793 Finished products 4,699 4,326 Total $ 12,445 $ 11,119 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment is comprised of the following (in thousands): Schedule of Property and Equipment March 31, 2021 December 31, 2020 Right-of-use assets under operating leases $ 724 $ 724 Right-of-use assets under finance leases 6 54 Computer hardware and software 400 400 Machinery and equipment 198 103 Total cost 1,328 1,281 Accumulated depreciation and amortization (379 ) (361 ) Net book value $ 949 $ 920 |
Schedule of Equipment Held for Sale | Equipment held for sale consists of the following (in thousands): Schedule of Equipment Held for Sale March 31, 2021 December 31, 2020 Equipment held for sale $ 163 $ 163 Reserve (96 ) (96 ) Net book value $ 67 $ 67 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | Intangible assets consist of the following (in thousands): Summary of Intangible Assets March 31, 2021 December 31, 2020 Brand names $ 576 $ 576 Trademarks 41 39 Total $ 617 $ 615 |
Line of Credit (Tables)
Line of Credit (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Amount Outstanding Under Credit Facilities | Amounts outstanding under the Company’s credit facilities are as follows (in thousands): Schedule of Amount Outstanding Under Credit Facilities March 31, 2021 December 31, 2020 Line of credit $ 4,256 $ - |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Non-vested Restricted Stock Activity | The following table summarizes restricted stock activity during the three months ended March 31, 2021: Summary of Non-vested Restricted Stock Activity Unvested Issuable Fair Value Weighted Balance, December 31, 2020 150,000 - $ 92 0.89 Granted 245,900 - 226 0.92 Vested (84,809 ) 84,809 - - Forfeited (2,009 ) 0.89 Issued - (84,809 ) (98 ) - Balance, March 31, 2021 309,082 - $ 220 $ 0.89 |
Schedule of Stock Option Activity | The following table summarizes stock option activity during the three months ended March 31, 2021: Schedule of Stock Option Activity Shares Weighted- Weighted- Aggregate Outstanding at December 31, 2020 9,417,898 $ 1.45 6.09 $ 78 Granted 1,939,700 $ 1.01 Exercised (6,000 ) $ 0.50 Unvested forfeited (315,526 ) $ 1.75 Vested forfeited (7,750 ) $ 2.51 Outstanding at March 31, 2021 11,028,322 $ 1.15 8.61 $ 2,332 Exercisable at March 31, 2021 3,160,048 $ 1.34 6.76 $ 759 |
Stock Warrants (Tables)
Stock Warrants (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Stock Warrants | |
Schedule of Warrant Activity | Schedule of Warrant Activity Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Terms (Years) Aggregate Intrinsic Value Outstanding at December 31, 2020 3,362,241 $ 1.56 2.49 $ - Exercised - - Forfeited - - Outstanding at March 31, 2021 3,362,241 $ 1.56 2.24 $ 526 Exercisable at March 31, 2021 3,362,241 $ 1.56 2.24 $ 526 |
Basis of Presentation and Liq_2
Basis of Presentation and Liquidity (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Net Income (Loss) Attributable to Parent | $ 4,507 | $ 2,580 | ||
Net Cash Provided by (Used in) Operating Activities | 5,059 | 2,352 | ||
Cash | 155 | $ 595 | ||
Line of Credit Facility, Current Borrowing Capacity | 2,513 | 5,166 | ||
Stockholders' Equity Attributable to Parent | 6,770 | $ (653) | 10,404 | $ 1,147 |
Working capital | $ 5,698 | $ 9,528 |
Schedule of Potentially Dilutiv
Schedule of Potentially Dilutive Securities (Details) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 14,737,289 | 13,901,473 |
Convertible Note to a Related Party [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,266,667 | |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 3,362,241 | 6,413,782 |
Common Stock Equivalent of Series A Convertible Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 37,644 | 37,644 |
Common Stock Issuable [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 350,000 | |
Unvested Restricted Common Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 309,082 | 150,000 |
Equity Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 11,028,322 | 4,683,380 |
Significant Accounting Polici_4
Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Product Information [Line Items] | |||
Advertising costs | $ 349 | $ 302 | |
Customer One [Member] | Revenue Benchmark [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 23.00% | 22.00% | |
Customer One [Member] | Accounts Receivable [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 18.00% | 23.00% | |
Customer Two [Member] | Revenue Benchmark [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 12.00% | 14.00% | |
Customer Two [Member] | Accounts Receivable [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 10.00% | ||
No Customer [Member] | Revenue Benchmark [Member] | Maximum [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 10.00% | ||
No Customer [Member] | Accounts Receivable [Member] | Maximum [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 10.00% | ||
Vendor One [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 13.00% | 10.00% | |
Vendor One [Member] | Accounts Payable [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 19.00% | 12.00% | |
Vendor Two [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 13.00% | ||
Vendor Two [Member] | Accounts Payable [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 10.00% | 10.00% | |
No Vendor [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 10.00% | ||
No Vendor [Member] | Accounts Payable [Member] | Maximum [Member] | |||
Product Information [Line Items] | |||
Percentage of sale accounted to customer | 10.00% |
Schedule of Inventory (Details)
Schedule of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials and packaging | $ 7,746 | $ 6,793 |
Finished products | 4,699 | 4,326 |
Total | $ 12,445 | $ 11,119 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Inventory Valuation Reserves | $ 174 | $ 194 |
Schedule of Property and Equipm
Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 1,328 | $ 1,281 |
Accumulated depreciation and amortization | (379) | (361) |
Net book value | 949 | 920 |
Right-of-use Assets Under Operating Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 724 | 724 |
Right-of-use Assets Under Finance Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 6 | 54 |
Computer Hardware And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 400 | 400 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 198 | $ 103 |
Schedule of Equipment Held for
Schedule of Equipment Held for Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Abstract] | ||
Equipment held for sale | $ 163 | $ 163 |
Reserve | (96) | (96) |
Net book value | $ 67 | $ 67 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 32 | $ 12 |
Operating Lease, Right-of-Use Asset, Amortization Expense | 24 | $ 37 |
Right-of-use Assets Under Finance Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Net book value of disposed right-of-use assets under finance leases | 48 | |
Accumulated amortization | 38 | |
Amount terminated related to finance leases | $ 13 |
Summary of Intangible Assets (D
Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Brand names | $ 576 | $ 576 |
Trademarks | 41 | 39 |
Total | $ 617 | $ 615 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of intangible assets | $ 0 |
intangible asset capitalized cost | $ 2 |
Schedule of Amount Outstanding
Schedule of Amount Outstanding Under Credit Facilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
Line of credit | $ 4,256 |
Line of Credit (Details Narrati
Line of Credit (Details Narrative) - USD ($) $ in Thousands | Oct. 04, 2018 | Oct. 04, 2018 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||||
Line of credit description | On March 11, 2021, the Company entered into an amendment to the financing agreement, releasing that irrevocable standby letter of credit of $1,500 by Raptor with a $2,000 pledge of securities to Rosenthal by John J. Bello and Nancy E. Bello, as Co-Trustees of The John and Nancy Bello Revocable Living Trust. | ||||
Shares issued restricted stock, value | $ 98 | $ 285 | |||
Amortization of prepaid financing costs | 25 | ||||
Annual fees | $ 130 | ||||
Percentage of fees on borrowing capacity | 1.00% | ||||
Line of credit | $ 13,000 | ||||
Unamortized debt discount | 0 | ||||
Amortization of debt discount | $ 162 | $ 96 | |||
Prepaid Expenses and Other Current Assets [Member] | |||||
Debt Instrument [Line Items] | |||||
Unamortized debt discount | $ 162 | ||||
Daniel J. Doherty [Member] | |||||
Debt Instrument [Line Items] | |||||
Letter of credit | $ 1,500 | $ 1,500 | |||
John J. Bello [Member] | Beneficial Owner [Member] | |||||
Debt Instrument [Line Items] | |||||
Equity ownership percentage | 5.00% | ||||
Shares issued restricted stock | 400,000 | ||||
Shares issued restricted stock, value | $ 472 | ||||
Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | 13,000 | 13,000 | |||
Excess of permitted borrowing amount | 4,000 | $ 4,000 | |||
Line of Credit Facility, Remaining Borrowing Capacity | $ 2,513 | ||||
Line of Credit Facility, Expiration Date | Mar. 30, 2021 | ||||
Line of credit, interest rate | 4.75% | ||||
Minimum monthly fees | $ 4 | ||||
Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit, interest rate | 2.00% | ||||
Financing Agreement [Member] | Rosenthal and Rosenthal, Inc. [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit, interest rate | 3.50% |
Note Payable (Details Narrative
Note Payable (Details Narrative) - USD ($) $ in Thousands | Apr. 20, 2020 | Mar. 31, 2021 | Dec. 31, 2020 |
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Note payable | $ 770 | $ 770 | |
Note payable, current | $ 727 | $ 599 | |
PPP Loan Agreement [Member] | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Debt Instrument, Maturity Date | Apr. 20, 2022 | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | ||
Paycheck Protection Program [Member] | City National Bank [Member] | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Aggregate amount | $ 770 |
Leases Liabilities (Details Nar
Leases Liabilities (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Customer Securities for which Entity has Right to Sell or Repledge (Including Securities Sold or Repledged) [Line Items] | |||
Operating Lease, Right-of-Use Asset, Amortization Expense | $ 24 | $ 37 | |
Operating lease, right-of-use asset | 730 | ||
Lease liabilities | 663 | $ 685 | |
Finance leases liability | 1 | 16 | |
Finance lease terminated | 13 | ||
Payments of finance lease liability | 2 | ||
Payments of operating lease liability | $ 8 | $ 7 | |
Weighted average remaining lease term for operating lease | 3 years 9 months 3 days | ||
Weighted average remaining lease term for finance lease | 6 months | ||
Weighted average discount rate for operating lease | 12.60% | ||
Weighted average discount rate for finance lease | 12.60% | ||
Operating Lease Liability [Member] | |||
Customer Securities for which Entity has Right to Sell or Repledge (Including Securities Sold or Repledged) [Line Items] | |||
Operating leases liability | $ 662 | $ 669 |
Summary of Non-vested Restricte
Summary of Non-vested Restricted Stock Activity (Details) - Restricted Stock [Member] $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested Shares, beginning balance | 150,000 |
Issuable Shares, beginning balance | |
Fair Value Unvested, beginning balance | $ | $ 92 |
Weighted Average Grant Date Fair Value, Unvested, beginning balance | $ / shares | $ 0.89 |
Unvested Shares, Granted | 245,900 |
Issuable Shares, Granted | |
Fair Value, Granted | $ | $ 226 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | $ 0.92 |
Unvested Shares, Vested | (84,809) |
Issuable Shares, Vested | 84,809 |
Fair Value, Vested | $ | |
Weighted Average Grant Date Fair Value, Vested | $ / shares | |
Unvested Shares, Forfeited | (2,009) |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | $ 0.89 |
Unvested Shares, Issued | |
Issuable Shares, Issued | (84,809) |
Fair Value, Issued | $ | $ (98) |
Weighted Average Grant Date Fair Value, Issued | $ / shares | |
Unvested Shares, ending balance | 309,082 |
Issuable Shares, ending balance | |
Fair Value, Unvested, ending balance | $ | $ 220 |
Weighted Average Grant Date Fair Value, Unvested, ending balance | $ / shares | $ 0.89 |
Schedule of Stock Option Activi
Schedule of Stock Option Activity (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($)$ / sharesshares | |
Summary of Investment Holdings [Line Items] | |
Shares, Exercised | (6,000) |
Equity Option [Member] | |
Summary of Investment Holdings [Line Items] | |
Shares Outstanding, Beginning balance | 9,417,898 |
Weighted-Average Exercise Price, Outstanding, Beginning | $ / shares | $ 1.45 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Beginning | 6 years 1 month 2 days |
Aggregate Intrinsic Value, Shares Outstanding, Begining | $ | $ 78 |
Shares, Granted | 1,939,700 |
Weighted-Average Exercise Price, Granted | $ / shares | $ 1.01 |
Shares, Exercised | (6,000) |
Weighted-Average Exercise Price, Exercised | $ / shares | $ 0.50 |
Shares, Unvested forfeited | (315,526) |
Weighted-Average Exercise Price, Unvested forfeited | $ / shares | $ 1.75 |
Shares, Vested forfeited | (7,750) |
Weighted-Average Exercise Price, Vested forfeited | $ / shares | $ 2.51 |
Shares Outstanding, Ending Balance | 11,028,322 |
Weighted-Average Exercise Price, Outstanding, Ending | $ / shares | $ 1.15 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Ending | 8 years 7 months 9 days |
Aggregate Intrinsic Value, Shares Outstanding, Ending | $ | $ 2,332 |
Shares Exercisable | 3,160,048 |
Weighted-Average Exercise Price, Exercisable Ending Balance | $ / shares | $ 1.34 |
Weighted-Average Remaining Contractual Terms (Years), Exercisable Ending Balance | 6 years 9 months 3 days |
Aggregate Intrinsic Value, Shares Exercisable Ending Balance | $ | $ 759 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Jan. 26, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares issued restricted stock, value | $ 98 | $ 285 | ||
Proceeds from stock option exercised | $ 3 | |||
Exercise of options, shares | 6,000 | |||
2020 Incentive Compensation Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of options to be issued | 1,939,700 | |||
Expected term | 6 years | |||
Dividend rate | 0.00% | |||
Risk-free interest rate | 0.94% | |||
2020 Incentive Compensation Plan [Member] | Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average volatility | 76.00% | |||
2017 Incentive Compensation Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock price | $ 1.01 | |||
Stock options expiration period | 10 years | |||
Fair value of options granted | $ 1,294 | |||
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares vested | 84,809 | |||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 98 | 285 | ||
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 220 | |||
Number of option issued | ||||
Share-based Payment Arrangement, Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 4,274 | |||
Number of shares vested immediately | 969,850 | |||
Vesting period | 4 years | |||
Number of options vested. | 969,850 | |||
Share-based Payment Arrangement, Expense | $ 300 | $ 495 | ||
Outstanding options, intrinsic value | 2,332 | |||
Exercisable, intrinsic value | $ 759 | |||
Exercise price, outstanding stock options | $ 1.17 | |||
Non Employee Directors [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Cash compensation | $ 50,000 | |||
Non Employee Directors [Member] | Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares awarded | 245,900 | |||
Shares issued restricted stock, value | $ 226 | |||
Exercise price fair value | $ 0.92 | |||
Non Employee Directors [Member] | Restricted Stock [Member] | February 1, 2021 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares vested | 61,475 | |||
Non Employee Directors [Member] | Restricted Stock [Member] | May 1, 2021, August 1, 2021, and November 1, 2021 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares expect to vest | 184,425 | |||
Employees [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of option issued | 1,939,700 |
Schedule of Warrant Activity (D
Schedule of Warrant Activity (Details) - Warrant [Member] $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($)$ / sharesshares | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Shares Outstanding, Beginning Balance | shares | 3,362,241 |
Weighted-Average Exercise Price, Outstanding Beginning Balance | $ / shares | $ 1.56 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Beginning Balance | 2 years 5 months 26 days |
Aggregate Intrinsic Value Shares Outstanding Beginning | $ | |
Shares, Exercised | shares | |
Weighted-Average Exercise Price, Exercised | $ / shares | |
Shares, Forfeited | shares | |
Weighted-Average Exercise Price, Forfeited | $ / shares | |
Shares Outstanding, Ending Balance | shares | 3,362,241 |
Weighted-Average Exercise Price, Outstanding Ending Balance | $ / shares | $ 1.56 |
Weighted-Average Remaining Contractual Terms (Years), Outstanding Ending Balance | 2 years 2 months 26 days |
Aggregate Intrinsic Value Shares Outstanding Ending | $ | $ 526 |
Shares Exercisable, Ending Balance | shares | 3,362,241 |
Weighted-Average Exercise Price, Exercisable Ending Balance | $ / shares | $ 1.56 |
Weighted-Average Remaining Contractual Terms (Years), Exercisable Ending Balance | 2 years 2 months 26 days |
Aggregate Intrinsic Value Shares Exercisable | $ | $ 526 |
Stock Warrants (Details Narrati
Stock Warrants (Details Narrative) $ / shares in Units, $ in Thousands | Mar. 31, 2021USD ($)$ / sharesshares |
Warrant [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Warrant to purchase common stock | shares | 3,362,241 |
Number of warrants outstanding, intrinsic value | $ 0 |
Aggregate intrinsic value | $ 526 |
Stock Warrants [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Stock price | $ / shares | $ 1.17 |
Related Party Activities (Detai
Related Party Activities (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Royalty [Member] | |||||
Related Party Transaction [Line Items] | |||||
Royalty revenue | $ 3 | $ 5 | |||
Chris Reed [Member] | |||||
Related Party Transaction [Line Items] | |||||
Deposit of security with lessor | $ 800 | ||||
Number of common stock value placed | 363,000 | ||||
Value of common stock paced | $ 425 | ||||
Receivable from related party | 701 | ||||
Lindsay Martin [Member] | Vice President [Member] | |||||
Related Party Transaction [Line Items] | |||||
Amount paid for service | 87 | $ 42 | |||
California Custom Beverage, LLC [Member] | Chris Reed [Member] | |||||
Related Party Transaction [Line Items] | |||||
Deposit of security with lessor | $ 1,200 | ||||
Royalty percentage | 5.00% | ||||
Referral fee percentage | 5.00% | ||||
Receivable from related party | $ 682 | ||||
Royalty revenue receivable | 3 | ||||
Inventory advances | 16 | ||||
Accounts payable due to related parties | $ 557 | $ 1,034 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - $ / shares | May 05, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Subsequent Event [Line Items] | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Number of shares sold | 6,680,000 | ||
Sale of stock price per share | $ 1.18 | ||
Description on sale of stock | The Placement Agent will be paid a total cash fee at the closing of the Offering equal to 6.5% of the gross cash proceeds received by the Company from the sale of the shares of common stock in the offering. | ||
Placement Agency Agreement [Member] | Roth Capital Partners, LLC [Member] | Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Common stock, par value | $ 0.0001 | ||
Securities Purchase Agreement [Member] | Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Common stock, par value | $ 0.0001 |