Uniroyal Global Engineered Products (UNIR) 10-Q 5 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jul. 05, 2015	Aug. 05, 2015
Document and Entity Information:
Entity Registrant Name	UNIROYAL GLOBAL ENGINEERED PRODUCTS, INC.
Entity Trading Symbol	UNIR
Document Type	10-Q
Document Period End Date	Jul. 5, 2015
Amendment Flag	false
Entity Central Index Key	1,172,706
Current Fiscal Year End Date	--01-03
Entity Common Stock, Shares Outstanding		14,351,798
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Jul. 05, 2015	Dec. 28, 2014
CURRENT ASSETS
Cash and cash equivalents	$ 1,991,056	$ 604,234
Accounts receivable, net	15,863,522	14,607,787
Inventories, net	19,167,048	17,421,082
Other current assets	1,986,640	2,130,282
Related party receivable	21,262	74,931
Total Current Assets	39,029,528	34,838,316
PROPERTY AND EQUIPMENT	13,728,711	12,001,128
OTHER ASSETS
Intangible assets	3,664,459	3,668,956
Goodwill	1,079,175	1,079,175
Other long-term assets	1,484,781	1,295,965
Total Other Assets	6,228,415	6,044,096
TOTAL ASSETS	58,986,654	52,883,540
CURRENT LIABILITIES
Checks issued in excess of bank balance	499,205	438,145
Line of credit	17,519,022	16,396,306
Current maturities of long-term debt	592,442	522,095
Current maturities of capital lease obligations	465,803	96,071
Accounts payable	10,158,494	9,409,062
Accrued expenses	4,127,900	3,408,143
Related party payable	0	20,260
Current portion of postretirement benefit liability - health and life	115,039	115,039
Total Current Liabilities	33,477,905	30,405,121
LONG-TERM LIABILITIES
Long-term debt, less current portion	1,385,294	1,355,297
Capital lease obligations, less current portion	1,683,639	238,836
Related party lease financing obligations	2,163,541	2,162,393
Long-term debt to related parties	4,743,696	4,740,728
Postretirement benefit liability - health and life, less current portion	2,651,721	2,662,570
Other long-term liabilities	776,592	840,378
Total Long-Term Liabilities	13,404,483	12,000,202
Total Liabilities	$ 46,882,388	$ 42,405,323
STOCKHOLDERS' EQUITY
Convertible Preferred Stock: 5,000,000 shares authorized ($100 value):
Series A, 9,715 shares issued and outstanding	$ 798,500	$ 798,500
Series B, 2,702 shares issued and outstanding	270,160	270,160
Series C, 16,124 shares issued and outstanding	1,600,467	1,600,467
Preferred units, Series A UEP Holdings, LLC, 200,000 units issued and outstanding ($100 issue price)	617,571	617,571
Preferred units, Series B UEP Holdings, LLC, 150,000 units issued and outstanding ($100 issue price)	463,179	463,179
Preferred stock, Engineered Products Acquisition Limited, 50 shares issued and outstanding ($1.51 stated value)	75	75
Common stock, 95,000,000 shares authorized ($.001 par value) 14,351,798 and 14,351,398 shares issued and outstanding as of July 5, 2015 and December 28, 2014, respectively	14,352	14,352
Additional paid-in capital	32,550,668	32,549,585
Accumulated deficit	(24,950,142)	(26,626,634)
Accumulated other comprehensive income	739,436	790,962
Total Stockholders' Equity	12,104,266	10,478,217
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 58,986,654	$ 52,883,540

CONSOLIDATED BALANCE SHEETS PAR

CONSOLIDATED BALANCE SHEETS PARENTHETICALS - $ / shares	Jul. 05, 2015	Dec. 28, 2014
Parentheticals
Preferred Stock Par value	$ 100	$ 100
Preferred Stock shares authorized	5,000,000	5,000,000
Series A Shares issued	9,715	9,715
Series A Shares outstanding	9,715	9,715
Series B Shares issued	2,702	2,702
Series B Shares outstanding	2,702	2,702
Series C Shares issued	16,124	16,124
Series C Shares outstanding	16,124	16,124
Series A UEP Holdings LLC par value	$ 100	$ 100
Series A UEP Holdings LLC shares issued	200,000	200,000
Series A UEP Holdings LLC shares outstanding	200,000	200,000
Series B UEP Holdings LLC par value	$ 100	$ 100
Series B UEP Holdings LLC shares issued	150,000	150,000
Series B UEP Holdings LLC shares outstanding	150,000	150,000
Preferred Stock,Engineered Products Acquisition limited shares Par value	$ 1.51	$ 1.51
Preferred Stock,Engineered Products Acquisition limited shares issued	50	50
Preferred Stock,Engineered Products Acquisition limited shares outstanding	50	50
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	95,000,000	95,000,000
Common Stock, shares issued	14,351,798	14,351,398
Common Stock, shares outstanding	14,351,798	14,351,398

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jul. 05, 2015	Jun. 29, 2014	Jul. 05, 2015	Jun. 29, 2014
Revenues:
NET SALES	$ 25,746,054	$ 25,400,012	$ 53,260,989	$ 49,770,246
COST OF GOODS SOLD	19,890,099	20,498,311	42,049,971	40,431,446
Gross Profit	5,855,955	4,901,701	11,211,018	9,338,800
OPERATING EXPENSES:
Selling	1,469,369	1,194,107	2,797,295	2,366,518
General and administrative	1,702,545	2,094,936	3,658,321	3,943,979
Research and development	418,964	390,329	744,794	751,935
OPERATING EXPENSES	3,590,878	3,679,372	7,200,410	7,062,432
Operating Income	2,265,077	1,222,329	4,010,608	2,276,368
OTHER INCOME (EXPENSE):
Interest and other debt related expense	(405,349)	(404,253)	(792,766)	(858,310)
Other income	5,343	85,214	172,704	109,647
Net Other Expense	(400,006)	(319,039)	(620,062)	(748,663)
INCOME BEFORE TAX PROVISION	1,865,071	903,290	3,390,546	1,527,705
TAX PROVISION	209,362	20,073	324,180	48,728
NET INCOME	1,655,709	883,217	3,066,366	1,478,977
Preferred stock dividend	(696,769)	0	(1,389,874)	0
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	958,940	883,217	1,676,492	1,478,977
OTHER COMPREHENSIVE INCOME (LOSS):
Minimum benefit liability adjustment	(45,230)	(147,474)	(90,459)	(294,948)
Foreign currency translation adjustment	398,149	141,338	38,933	180,607
Unrealized gain (loss) on effective hedge:
Reclassification of amounts to earnings	0	16,644	0	33,143
Unrealized loss for the year	0	(166)	0	(1,561)
COMPREHENSIVE INCOME TO COMMON SHAREHOLDERS	$ 1,311,859	$ 893,559	$ 1,624,966	$ 1,396,218
EARNINGS PER COMMON SHARE:
Basic	$ 0.07	$ 0.06	$ 0.12	$ 0.10
Diluted	$ 0.05	$ 0.05	$ 0.09	$ 0.08
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic	14,351,797	14,137,731	14,351,684	14,158,920
Diluted	19,108,630	18,894,565	19,108,517	18,915,754

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - 6 months ended Jul. 05, 2015 - USD ($)	Preferred A Shares	Preferred A Amount	Preferred B Shares	Preferred B Amount	Preferred C Shares	Preferred C Amount	UEPH Series A Units	UEPH Series A Amount	UEPH Series B Units	UEPH Series B Amount	EPAL Preferred Shares	EPAL Preferred Amount	Common Stock Shares	Common Stock Amount	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income	Total Equity
Balance at Dec. 28, 2014	9,715	798,500	2,702	270,160	16,124	1,600,467	200,000	617,571	150,000	463,179	50	75	14,351,398	14,352	32,549,585	(26,626,634)	790,962	10,478,217
Net Income		$ 0		$ 0		$ 0		$ 0		$ 0		$ 0		$ 0	$ 0	$ 3,066,366	$ 0	$ 3,066,366
Issuance of and subscription for common stock	0	0	0	0	0	0	0	0	0	0	0	0	400	0	1,083	0	0	1,083
Other comprehensive loss		$ 0		$ 0		$ 0		$ 0		$ 0		$ 0		$ 0	$ 0	$ 0	$ (51,526)	$ (51,526)
Preferred stock dividend		$ 0		$ 0		$ 0		$ 0		$ 0		$ 0		$ 0	$ 0	$ (1,389,874)	$ 0	$ (1,389,874)
Balance at Jul. 05, 2015	9,715	798,500	2,702	270,160	16,124	1,600,467	200,000	617,571	150,000	463,179	50	75	14,351,798	14,352	32,550,668	(24,950,142)	739,436	12,104,266

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jul. 05, 2015	Jun. 29, 2014
CASH FLOWS FROM OPERATING ACTIVITIES
NET INCOME	$ 3,066,366	$ 1,478,977
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation	745,660	687,769
Contributed officer compensation	0	18,000
Amortization of intangible assets	10,002	30,233
Loss on disposal of property and equipment	15,374	0
Noncash postemployment health and life benefit	(49,190)	(294,948)
Changes in assets and liabilities:
Accounts receivable	(1,198,439)	(2,189,420)
Inventories	(1,700,436)	368,542
Other current assets	142,399	(218,357)
Related party receivable/payable	35,564	(5,706)
Other long-term assets	(31,708)	(100,249)
Accounts payable	713,984	644,113
Accrued expenses	419,850	633,362
Postretirement benefit liability - health and life	(52,117)	(13,149)
Other long-term liabilities	(64,667)	(23,009)
Cash Flows provided by Operating Activities	2,052,642	1,016,158
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures	(2,264,541)	(1,293,890)
Cash Flows used in Investing Activities	(2,264,541)	(1,293,890)
CASH FLOWS FROM FINANCING ACTIVITIES
Checks issued in excess of bank balance, net	61,060	(267,271)
Net advances on line of credit	831,585	875,065
Payments on long-term debt	(61,805)	(91,790)
Proceeds from issuance of long-term debt and capital lease obligations	2,144,813	567,449
Payments on capital lease obligations	(136,442)	(61,949)
Net payments on life insurance policies	(157,107)	(154,990)
Proceeds from related party obligation	0	121,580
Payment of preferred stock dividends	(1,106,892)	0
Purchase of treasury stock	0	(138,714)
Distributions to members	0	(213,002)
Cash Flows provided by Financing Activities	1,575,212	636,378
Net Change in Cash and Cash Equivalents	1,363,313	358,646
Cash And Cash Equivalents - Beginning Of Period	604,234	311,029
Effects of currency translation on cash and cash equivalents	23,509	16,203
CASH AND CASH EQUIVALENTS - END OF PERIOD	$ 1,991,056	$ 685,878

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jul. 05, 2015
Basis of Presentation
Basis of Presentation	1. Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared based upon U.S. Securities and Exchange Commission rules that permit reduced disclosure for interim periods. Therefore, they do not include all information and footnote disclosures necessary for a complete presentation of Uniroyal Global Engineered Products, Inc.’s financial position, results of operations and cash flows, in conformity with generally accepted accounting principles. Uniroyal Global Engineered Products, Inc. (the “Company,” “Uniroyal Global,” “we,” or “us”) filed audited consolidated financial statements as of and for the years ended December 31, 2014 and 2013, which included all information and notes necessary for such complete presentation in conjunction with its 2014 Annual Report on Form 10-K. On April 29, 2015, the Board of Directors adopted an amendment to the Articles of Incorporation to change the Company’s name from Invisa, Inc. to Uniroyal Global Engineered Products, Inc. On June 25, 2015, the stockholders approved the amendment. The amended and restated Articles of Incorporation were filed with the Nevada Secretary of State and became effective on July 15, 2015. The results of operations for the interim period ended July 5, 2015 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2014, which are contained in the Company’s 2014 Annual Report on Form 10-K. On November 10, 2014 the Company acquired all of the ownership interests in Uniroyal Engineered Products, LLC (“Uniroyal”), a U.S. manufacturer of textured coatings, and all of the ordinary common stock of Engineered Products Acquisition Limited (“EPAL”), the holding company for Wardle Storeys (Group) Limited (“Wardle Storeys”), a European manufacturer of textured coatings and polymer films. At that time the Company’s fiscal year was January 1 to December 31. Prior to their acquisitions these companies had been on a 52/53 week year depending on the nearest Sunday to December 31. Effective with the current year, the Company is changing its fiscal year to correspond to the reporting periods of its subsidiaries. The current fiscal year will be a 53 week year and will end on January 3, 2016. The current year’s interim quarters ended or will end on April 5, 2015, July 5, 2015 and October 4, 2015. The prior year comparative financial statements have been adjusted to conform with a 52/53 week reporting cycle . This change will not have any significant effect on the previously filed Annual Report on Form 10-K for the year ended December 31, 2014. The accompanying unaudited interim consolidated financial statements contain all adjustments (consisting of normal recurring items) which are, in the opinion of management, necessary for a fair statement of the Company’s financial position as of July 5, 2015, the results of operations, comprehensive income and cash flows for the interim periods ended July 5, 2015 and June 29, 2014. The unaudited interim consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The Company uses the US dollar as the reporting currency for financial reporting. The financial position and results of operations of the Company’s UK-based operations are measured using the British Pound Sterling as the functional currency. Foreign currency translation gains and losses are recorded as a change in other comprehensive income. Transaction gains and losses generated from the remeasurement of assets and liabilities denominated in currencies other than the functional currency of our foreign operations are included in other (expense) / income on the consolidated statements of comprehensive income.

Noncash Transactions and Supple

Noncash Transactions and Supplemental Disclosure of Cash Flow Information	6 Months Ended
	Jul. 05, 2015
Noncash Transactions and Supplemental Disclosure of Cash Flow Information Text Block:
Noncash Transactions and Supplemental Disclosure of Cash Flow Information Text Block	2. Noncash Transactions and Supplemental Disclosure of Cash Flow Information During the six months ended June 29, 2014 the Company had reduced borrowings on its line of credit by converting dollars to additional borrowings on its term loans with Wells Fargo Capital Finance, LLC of $573,972. During the six months ended July 5, 2015 and six months ended June 29, 2014, the Company paid down its term loans using available borrowings on its various lines of credit of $248,336 and $339,829, respectively. The Company entered into new equipment leases with a value of $172,367 and $384,973 for the six months ended July 5, 2015 and June 29, 2014, respectively, which are accounted for as capital leases. The fair value was added to property and equipment and a corresponding amount to capital lease obligations. Supplemental disclosure of cash paid for: July 5, 2015 June 29, 2014 Interest expense $ 774,122 $ 639,857

Derivatives

Derivatives	6 Months Ended
	Jul. 05, 2015
Derivatives
Derivatives	3. Derivatives The Company recognizes all of its derivative instruments, which consist of interest rate swaps, as either assets or liabilities in the balance sheet at fair value. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, whether the hedge is a cash flow hedge or a fair value hedge. The Company incurs foreign currency risk on sales and purchases denominated in other currencies, primarily the British Pound Sterling and the Euro. Foreign currency exchange contracts are used by the Company principally to limit the exchange rate fluctuations of the Euro. The Euro risk is partially limited due to natural cash flow offsets. Currency exchange contracts are purchased for approximately 25% of the net risk. These contracts are not designated as cash flow hedges for accounting purposes. Changes in fair value of these contracts are reported in net earnings as part of other income and expense.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	6 Months Ended
	Jul. 05, 2015
Fair Value of Financial Instruments:
Fair Value of Financial Instruments	4. Fair Value of Financial Instruments The Company’s short term financial instruments consist of cash and cash equivalents, receivables, accounts payable and the line of credit. The Company adjusts the carrying value of financial assets denominated in other currencies such as cash, receivables, accounts payable and the lines of credit using the appropriate exchange rates at the balance sheet date. The Company believes that the carrying values of these short term financial instruments approximate their estimated fair values. The fair value of the Company’s long term debt is estimated based on current rates for similar instruments with the same remaining maturities. In determining the current interest rates for similar instruments the Company takes into account its risk of nonperformance. The Company believes that the carrying value of its long term debt approximates its estimated fair value. The fair value of the Company’s interest rate swaps is the estimated amounts that the Company would receive, or pay, to sell or transfer the swaps to a third party, taking into account current and future interest rates and the nonperformance risk of the Company and the counterparty. At July 5, 2015 and December 28, 2014 the Company did not have any interest rate swaps. The Company uses foreign currency exchange contracts which are recorded at their estimated fair values in the accompanying consolidated balance sheets. The fair values of the currency exchange contracts are based upon observable market transactions of spot and forward rates. For the six months ended July 5, 2015, there have been no changes in the application of valuation methods applied to similar assets and liabilities.

Foreign Currency Translation

Foreign Currency Translation	6 Months Ended
	Jul. 05, 2015
Foreign Currency Translation:
Foreign Currency Translation	5. Foreign Currency Translation The financial position and results of operations of the Company’s foreign subsidiaries are measured using the local currency as the functional currency. Assets and liabilities of operations denominated in foreign currencies are translated into U.S. dollars at exchange rates in effect at the balance sheet date, while revenues and expenses are translated at the weighted average exchange rates during the year. The resulting translation gains and losses on assets and liabilities are recorded in accumulated other comprehensive income (loss), and are excluded from net income until realized through a sale or liquidation of the investment.

Inventory

Inventory	6 Months Ended
	Jul. 05, 2015
Inventory
Inventory	6. Inventory Inventories consist of the following: July 5, 2015 December 28, 2014 Raw materials $ 6,933,326 $ 5,225,361 Work-in-process 5,073,509 4,074,324 Finished goods 8,214,052 9,103,269 20,220,887 18,402,954 Less: Allowance for inventory obsolescence (1,053,839 ) (981,872 ) Total Inventories $ 19,167,048 $ 17,421,082

Other Current Assets

Other Current Assets	6 Months Ended
	Jul. 05, 2015
Other Current Assets
Other Current Assets	7. Other Current Assets Other current assets consist of the following: July 5, 2015 December 28, 2014 Current deferred tax asset, net of valuation allowance $ 775,930 $ 1,076,138 Other 1,210,710 1,054,144 Total Other Current Assets $ 1,986,640 $ 2,130,282

Other Long-term Assets

Other Long-term Assets	6 Months Ended
	Jul. 05, 2015
Other Long-term Assets
Other Long-term Assets	8. Other Long-term Assets Other long-term assets consist of the following: July 5, 2015 December 28, 2014 Non-current deferred tax asset, net of valuation allowance $ 835,000 $ 835,000 Other 649,781 460,965 Total Other Long-term Assets $ 1,484,781 $ 1,295,965

Other Long-term Liabilities

Other Long-term Liabilities	6 Months Ended
	Jul. 05, 2015
Other Long-term Liabilities
Other Long-term Liabilities	9. Other Long-term Liabilities Other long-term liabilities consist of the following: July 5, 2015 December 28, 2014 Non-current deferred tax liability $ 708,674 $ 742,997 Other 67,918 97,381 Total Other Long-term Liabilities $ 776,592 $ 840,378

Line of Credit

Line of Credit	6 Months Ended
	Jul. 05, 2015
Line of Credit
Line of Credit	10. Line of Credit The Company’s Uniroyal subsidiary has available a $30,000,000 revolving line of credit financing agreement with Wells Fargo Capital Finance, LLC, which matures on October 17, 2019. Interest is payable monthly at the Eurodollar rate plus 2.25% or Wells Fargo Capital Finance, LLC's prime rate at the Company's election on outstanding balances up to $6,000,000 and prime rate on amounts in excess of $6,000,000. The outstanding balance on the line of credit (“Uniroyal Line of Credit”) was $8,825,017 and $8,775,684 as of July 5, 2015 and December 28, 2014, respectively. The Company has classified the outstanding balance on this line of credit within current liabilities in the accompanying consolidated balance sheets. The Company’s Wardle Storeys subsidiary has available a £8,500,000 (approximately $13.2 million) revolving line of credit financing agreement with Lloyds Bank Commercial Finance Limited, which agreement can be terminated on six months’ notice by either party. The line has several tranches based on currency or underlying security. Interest is payable monthly at the base rate (UK LIBOR) plus 1.95% to 2.45% depending on the tranche. The outstanding balance on the line of credit (“Wardle Storeys Line of Credit”) was £5,564,601 and £4,888,972 ($8,694,005 and $7,620,622) as of July 5, 2015 and December 28, 2014, respectively. The Company has classified the outstanding balance on this line of credit within current liabilities in the accompanying consolidated balance sheets.

Long-Term Debt

Long-Term Debt	6 Months Ended
	Jul. 05, 2015
Long-Term Debt
Long-Term Debt	11. Long-Term Debt Long-term debt consists of the following: Interest Rate July 5, 2015 December 28, 2014 Wells Fargo Capital Finance LLC Prime $ 1,153,813 $ 1,341,643 Lloyds Bank Commercial Finance Limited LIBOR + 3.15% 380,700 441,642 Wells Fargo Equipment Finance 7.82% — 26,894 Wells Fargo Equipment Finance 11.43% 12,360 28,811 Wells Fargo Equipment Finance 7.89% 3,323 6,519 Susquehanna Commercial Finance, Inc. 12.70% 16,619 31,883 Balboa Capital Corporation 5.72% 410,921 — 1,977,736 1,877,392 Current portion (592,442 ) (522,095 ) $ 1,385,294 $ 1,355,297 On May 11, 2015 the Company entered into a lease financing arrangement with Balboa Capital Corporation and received a payment of $410,921. The arrangement accrues interest at 5.72% and requires quarterly principal and interest payments of $37,169 starting August 15, 2015. The arrangement matures in May 2018 and is secured by certain equipment at the Company’s Stoughton, WI facility.

Related Party Obligations

Related Party Obligations	6 Months Ended
	Jul. 05, 2015
Related Party Obligations
Related Party Obligations	12. Related Party Obligations Long-term debt to related parties consists of the following: Interest Rate July 5, 2015 December 28, 2014 Senior subordinated promissory note 9.25% $ 2,000,000 $ 2,000,000 Secured promissory note 6.25% 1,273,639 1,270,671 Senior secured promissory note 10.00% 1,470,057 1,470,057 $ 4,743,696 $ 4,740,728 The Company has a lease financing obligation under which it leases its main manufacturing facility and certain other property from a related party lessor entity, accrues interest at 18.20% and requires monthly principal and interest payments of $31,800, which are adjusted annually based on the consumer price index. This lease was modified to add new property in November 2014. The additional lease payment of $1,500 per month is included in the $31,800. The lease financing obligation matures on October 31, 2033. The Company has security deposits aggregating $267,500 held by the lessor entity. For the years 2014 through 2016 the amount of interest owed exceeds the amount of payments made, resulting in a net increase to the outstanding principal balance of the lease financing obligation. This obligation is shown in the accompanying financial statements as Related Party Lease Financing Obligation which has a balance of $2,164,548 (which includes the current portion of $1,007) and $2,162,393 as of July 5, 2015 and December 28, 2014, respectively.

Capital Leases

Capital Leases	6 Months Ended
	Jul. 05, 2015
Capital Leases
Capital Leases	13. Capital Leases The Company has several capital leases on equipment which expire from September 2015 through March 2020 with monthly lease payments ranging from approximately $1,176 to $20,979 per month. The capital lease obligations are secured by the related equipment. As of July 5, 2015 and December 28, 2014, assets recorded under capital leases are included in property and equipment in the accompanying balance sheets. Amortization of items under capital lease obligations has been included with depreciation expense on owned property and equipment in the accompanying statements of operations. The Company constructed a new manufacturing line at its UK facility at a cost of approximately $2,378,000 commencing in 2014 and completed in March 2015. The Company entered into a financing lease in March 2015 and received a payment of £1,136,697 (approximately $1,720,589) from the leasing company. The financing lease has 60 monthly payments of £20,979 (approximately $31,000) with an interest rate of 4.09%. The principal balances of the capital lease obligations were $2,149,442 and $334,907 as of July 5, 2015 and December 28, 2014, respectively, with interest rates ranging from 3.84% to 14.47%.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income	6 Months Ended
	Jul. 05, 2015
Accumulated Other Comprehensive Income Text Block:
Accumulated Other Comprehensive Income	14. Accumulated Other Comprehensive Income The changes in accumulated other comprehensive income (loss) were as follows: Minimum Benefit Liability Adjustments Foreign Currency Translation Adjustment Total Balance at December 28, 2014 $ 702,067 $ 88,895 $ 790,962 Other comprehensive loss before reclassifications 38,933 38,933 Reclassification adjustment for gain (loss) included in net income (90,459 ) (90,459 ) Balance at July 5, 2015 $ 611,608 $ 127,828 $ 739,436 The gain (loss) reclassified from accumulated other comprehensive income (loss) into income is recorded to the following income statement line items: Other Comprehensive Income Component Income Statement Line Item Minimum Benefit Liability Adjustments General and administrative expense Unrealized Gain (Loss) on Effective Hedge Interest expense

Stock Option Plan

Stock Option Plan	6 Months Ended
	Jul. 05, 2015
Stock Option Plan:
Stock Option Plan	15. Stock Option Plan On June 25, 2015, the Company’s stockholders approved the adoption of the 2015 Stock Option Plan. This plan provides for the granting of options to purchase the Company’s common stock to employees and directors. The options granted are subject to a vesting schedule as set forth in each individual option agreement. Each option expires on the tenth anniversary of its date of grant unless an earlier termination date is provided in the grant agreement. The maximum aggregate number of shares of common stock that may be optioned and sold under the plan shall be 6% of the shares outstanding on the date of grant. The shares that may be optioned under the plan may be authorized but unissued or may be treasury shares. No options have been granted pursuant to the plan as of July 5, 2015.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	6 Months Ended
	Jul. 05, 2015
Recent Accounting Pronouncements:
Recent Accounting Pronouncements	16. Recent Accounting Pronouncements Standards Board issued a new standard ASU No. 2014-09, "Revenue from Contracts with Customers." Under ASU 2014-09 recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard will be effective for the Company on January 1, 2018. The Company is in the process of determining what impact, if any, the adoption of this ASU will have on its financial position, results of operations and cash flows. On February 18, 2015, the Financial Accounting Standards Board issued a new standard ASU No. 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis." The new standard affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. It will be effective for the Company on January 1, 2016. The Company is in the process of determining what impact, if any, the adoption of this ASU will have on its financial position, results of operations and cash flows.

Earnings per Common Share

Earnings per Common Share	6 Months Ended
	Jul. 05, 2015
Earnings per Common Share:
Earnings per Common Share	17. Earnings per Common Share The Company calculates basic net income per common share by dividing net income after the deduction of preferred stock or preference dividends by the weighted average number of common shares outstanding. The calculation of diluted net income per share is consistent with that of basic net income per common share but gives effect to all potential common shares (that is, securities such as options, warrants or convertible securities) that were outstanding during the period, unless the effect is antidilutive. At July 5, 2015 and December 28, 2014, the Company’s 28,541 shares of convertible preferred stock Series A, Series B and Series C can be converted into 4,756,833 common shares. This amount was added to the weighted average common shares to calculate the diluted earnings per share.

Subsequent Events

Subsequent Events	6 Months Ended
	Jul. 05, 2015
Subsequent Events:
Subsequent Events	18. Subsequent Events The Company has evaluated subsequent events occurring through the date that the financial statements were issued, for events requiring recording or disclosure in the July 5, 2015 financial statements. There were no material events or transactions occurring during this period requiring recognition or disclosure.

Schedule of Noncash Transaction

Schedule of Noncash Transactions and Supplemental Disclosure of Cash Flow Information (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Noncash Transactions and Supplemental Disclosure of Cash Flow Information
Schedule of Noncash Transactions and Supplemental Disclosure of Cash Flow Information Text Block	Supplemental disclosure of cash paid for: July 5, 2015 June 29, 2014 Interest expense $ 774,122 $ 639,857

Schedule of Inventories (Tables

Schedule of Inventories (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Inventories
Schedule of Inventories	Inventories consist of the following: July 5, 2015 December 28, 2014 Raw materials $ 6,933,326 $ 5,225,361 Work-in-process 5,073,509 4,074,324 Finished goods 8,214,052 9,103,269 20,220,887 18,402,954 Less: Allowance for inventory obsolescence (1,053,839 ) (981,872 ) Total Inventories $ 19,167,048 $ 17,421,082

Schedule of Other Current Asset

Schedule of Other Current Assets (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Other Current Assets
Schedule of Other Current Assets	Other current assets consist of the following: July 5, 2015 December 28, 2014 Current deferred tax asset, net of valuation allowance $ 775,930 $ 1,076,138 Other 1,210,710 1,054,144 Total Other Current Assets $ 1,986,640 $ 2,130,282

Schedule of Other Long-term Ass

Schedule of Other Long-term Assets (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Other Long-term Assets
Schedule of Other Long-term Assets	Other long-term assets consist of the following: July 5, 2015 December 28, 2014 Non-current deferred tax asset, net of valuation allowance $ 835,000 $ 835,000 Other 649,781 460,965 Total Other Long-term Assets $ 1,484,781 $ 1,295,965

Schedule of Other Long-term Lia

Schedule of Other Long-term Liabilities (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Other Long-term Liabilities :
Schedule of Other Long-term Liabilities	Other long-term liabilities consist of the following: July 5, 2015 December 28, 2014 Non-current deferred tax liability $ 708,674 $ 742,997 Other 67,918 97,381 Total Other Long-term Liabilities $ 776,592 $ 840,378

Schedule of Long-Term Debt (Tab

Schedule of Long-Term Debt (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Long-Term Debt
Schedule of Long-Term Debt	Long-term debt consists of the following: Interest Rate July 5, 2015 December 28, 2014 Wells Fargo Capital Finance LLC Prime $ 1,153,813 $ 1,341,643 Lloyds Bank Commercial Finance Limited LIBOR + 3.15% 380,700 441,642 Wells Fargo Equipment Finance 7.82% — 26,894 Wells Fargo Equipment Finance 11.43% 12,360 28,811 Wells Fargo Equipment Finance 7.89% 3,323 6,519 Susquehanna Commercial Finance, Inc. 12.70% 16,619 31,883 Balboa Capital Corporation 5.72% 410,921 — 1,977,736 1,877,392 Current portion (592,442 ) (522,095 ) $ 1,385,294 $ 1,355,297

Schedule of Related Party Oblig

Schedule of Related Party Obligations (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Related Party Obligations
Schedule of Related Party Obligations	Long-term debt to related parties consists of the following: Interest Rate July 5, 2015 December 28, 2014 Senior subordinated promissory note 9.25% $ 2,000,000 $ 2,000,000 Secured promissory note 6.25% 1,273,639 1,270,671 Senior secured promissory note 10.00% 1,470,057 1,470,057 $ 4,743,696 $ 4,740,728

Schedule of Accumulated Other C

Schedule of Accumulated Other Comprehensive Income (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of Accumulated Other Comprehensive Income
Schedule of Accumulated Other Comprehensive Income (Loss)	The changes in accumulated other comprehensive income (loss) were as follows: Minimum Benefit Liability Adjustments Foreign Currency Translation Adjustment Total Balance at December 28, 2014 $ 702,067 $ 88,895 $ 790,962 Other comprehensive loss before reclassifications 38,933 38,933 Reclassification adjustment for gain (loss) included in net income (90,459 ) (90,459 ) Balance at July 5, 2015 $ 611,608 $ 127,828 $ 739,436

Schedule of gain (loss) reclass

Schedule of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (Tables)	6 Months Ended
	Jul. 05, 2015
Schedule of gain (loss) reclassified from accumulated other comprehensive income (loss) into income
Schedule of gain (loss) reclassified from accumulated other comprehensive income (loss) into income	The gain (loss) reclassified from accumulated other comprehensive income (loss) into income is recorded to the following income statement line items: Other Comprehensive Income Component Income Statement Line Item Minimum Benefit Liability Adjustments General and administrative expense Unrealized Gain (Loss) on Effective Hedge Interest expense

Noncash Transactions and Supp34

Noncash Transactions and Supplemental Disclosure of Cash Flow Information (Details) - USD ($)	6 Months Ended
	Jul. 05, 2015	Jun. 29, 2014
Noncash Transactions and Supplemental Disclosure of Cash Flow Information:
Reduced borrowings on line of credit converting dollars to additional borrowings on term loans		$ 573,972
Paid down term loans using available borrowings on lines of credit	$ 248,336	339,829
New equipment leases during the period valued at	172,367	354,973
Interest expense	$ 774,122	$ 639,857

Derivatives (Details)

Derivatives (Details)	Jul. 05, 2015
Derivatives:
Currency exchange contracts purchased for percentage of net risk	25.00%

Fair Value of Financial Instr36

Fair Value of Financial Instruments (Details)	Jul. 05, 2015	Dec. 28, 2014
Fair Value of Financial Instruments Details
Interest rate swaps	0	0

Inventories (Details)

Inventories (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Inventories consist of the following:
Raw materials	$ 6,933,326	$ 5,225,361
Work-in-process	5,073,509	4,074,324
Finished goods	8,214,052	9,103,269
Inventories gross	20,220,887	18,402,954
Less: Allowance for inventory obsolescence	(1,053,839)	(981,872)
Inventories, net	$ 19,167,048	$ 17,421,082

Other Current Assets (Details)

Other Current Assets (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Other Current Assets Details
Current deferred tax asset, net of valuation allowance	$ 775,930	$ 1,076,138
Other	1,210,710	1,054,144
Total Other Current Assets	$ 1,986,640	$ 2,130,282

Other Long-term Assets (Details

Other Long-term Assets (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Other Long-term Assets Details
Non-current deferred tax asset, net of valuation allowance	$ 835,000	$ 835,000
Other	649,781	460,965
Total Other Long-term Assets	$ 1,484,781	$ 1,295,965

Other Long-term Liabilities (De

Other Long-term Liabilities (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Other long-term liabilities consists of the following:
Non-current deferred tax liability	$ 708,674	$ 742,997
Other	67,918	97,381
Total Other Long-term Liabilities	$ 776,592	$ 840,378

Line of Credit (Narrative) (Det

Line of Credit (Narrative) (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Line of Credit Details
Revolving line of credit - Uniroyal subsidiary	$ 30,000,000
Monthly interest payments at the Eurodollar rate plus	2.25%
Outstanding balance on the line of credit	$ 8,825,017	$ 8,775,684
Revolving line of credit - Wardle Storeys subsidary	$ 13,200,000
Interest is payable monthly at the base rate (UK LIBOR) plus minimum	1.95%
Interest is payable monthly at the base rate (UK LIBOR) plus maximum	2.45%
Outstanding balance on the line of credit	$ 8,694,005	$ 7,620,622

Long-term debt (Details)

Long-term debt (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Long-term debt consists of the following
Wells Fargo Capital Finance LLC Prime	$ 1,153,813	$ 1,341,643
Lloyds Bank Commercial Finance Limited LIBOR +	380,700	441,642
Wells Fargo Equipment Finance	0	26,894
Wells Fargo Equipment Finance	12,360	28,811
Wells Fargo Equipment Finance	3,323	6,519
Susquehanna Commercial Finance, Inc.	16,619	31,883
Balboa Capital Corporation	410,921	0
Totals Long term debt	1,977,736	1,877,392
Less: Current portion	(592,442)	(522,095)
Long-Term Portion	$ 1,385,294	$ 1,355,297

Long term debt Parentheticals (

Long term debt Parentheticals (Details)	Jul. 05, 2015
Long term debt Parentheticals
Wells Fargo Capital Finance LLC Interest rate payable monthly on loan Prime	2.25%
Lloyds Bank Commercial Finance Limited Interest rate payable monthly on loan LIBOR	3.15%
Interest rate on note due on January 1, 2015	7.82%
Interest rate on note due on October 1, 2015	11.43%
Interest rate on note due in December 2015	7.89%
Interest rate on note due in November 2015	12.70%
Interest rate on note due Balboa Capital Corporation	5.72%

Long term debt - Lease financin

Long term debt - Lease financing arrangement (Details) - May. 11, 2015 - USD ($)	Total
Lease financing arrangement with Balboa Capital Corporation:
Payment received	$ 410,921
Accrued Interest	5.72%
Quarterly principal and interest payments	$ 37,169

Long-term debt to related parti

Long-term debt to related parties consists of the following (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Long-term debt to related parties consists of the following
Senior subordinated promissory note	$ 2,000,000	$ 2,000,000
Secured promissory note	1,273,639	1,270,671
Senior secured promissory note	1,470,057	1,470,057
Total Long-term Debt to Related Parties	$ 4,743,696	$ 4,740,728

Related Party Obligations Paren

Related Party Obligations Parentheticals (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Related Party Obligations Parentheticals
Senior subordinated promissory note interest rate	9.25%	0.00%
Secured promissory note interest rate	6.25%	0.00%
Senior secured promissory note interest rate	10.00%	0.00%
Rate of interest payable on capital lease obligation	18.20%	0.00%
Monthly principal and interest payments to be made on capital lease obligation	$ 31,800	$ 0
Increase in the monthly payment due to Lease amendment	1,500	0
Security deposit made with the lessor entity at the inception of the lease financing arrangement	267,500	0
Related Party Lease Financing Obligation balance	$ 2,164,548	$ 2,162,393

Capital Leases (Details)

Capital Leases (Details) - USD ($)	Jul. 05, 2015	Dec. 28, 2014
Capital Leases Details
Monthly lease payments minimum	$ 1,176
Monthly lease payments maximum	$ 20,979
Interest rates minimum	3.84%
Interest rates maximum	14.47%
Principal balance of the capital lease obligations	$ 2,149,442	$ 334,907
Constructed a new manufacturing line at UK facility at a cost	2,378,000
Financing lease received a payment from the leasing company	1,720,589
Financing lease has 60 monthly payments	$ 31,000
Financing lease interest rate	4.09%

Stock Option Plan (Details)

Stock Option Plan (Details) - shares	Jul. 05, 2015	Jun. 25, 2015
Stock Option Plan Details
The maximum aggregate number of shares of common stock that may be optioned and sold under the plan shall be percent of the shares outstanding on the date of grant		6.00%
Options granted pursuant to the plan as of date.	0

Changes in accumulated other co

Changes in accumulated other comprehensive income (loss) (Details) {Stockholders equity} - 6 months ended Jul. 05, 2015 - USD ($)	Total
Minimum Benefit Liability Adjustments
Balance.	702,067
Other comprehensive loss before reclassifications	$ 0
Reclassification adjustment for gain (loss) included in net income	$ (90,459)
Balance.	611,608
Foreign Currency Translation Adjustment
Balance.	88,895
Other comprehensive loss before reclassifications	$ 38,933
Reclassification adjustment for gain (loss) included in net income	$ 0
Balance.	127,828
Total
Balance.	790,962
Other comprehensive loss before reclassifications	$ 38,933
Reclassification adjustment for gain (loss) included in net income	$ (90,459)
Balance.	739,436

Earnings per Common Share (Deta

Earnings per Common Share (Details) - shares	Jul. 05, 2015	Dec. 28, 2014
Earnings per Common Share Details
Shares of convertible preferred stock Series A, Series B and Series C	28,541	28,541
Shares of convertible preferred stock Series A, Series B and Series C convertible into common shares	4,756,833	4,756,833