Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2013 | Mar. 05, 2014 | Jun. 28, 2013 |
Document and Entity Information | ' | ' | ' |
Entity Registrant Name | 'Summer Infant, Inc. | ' | ' |
Entity Central Index Key | '0001314772 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Public Float | ' | ' | $33.60 |
Entity Common Stock, Shares Outstanding | ' | 18,257,924 | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ' | ' |
Cash and cash equivalents | $1,573 | $3,132 |
Trade receivables, net of allowance for doubtful accounts of $100 and $78 at December 31, 2013 and 2012, respectively | 34,574 | 45,299 |
Inventory, net | 38,378 | 49,823 |
Prepaids and other current assets | 1,890 | 2,483 |
Deferred tax assets | 832 | 1,185 |
TOTAL CURRENT ASSETS | 77,247 | 101,922 |
Property and equipment, net | 14,796 | 16,834 |
Other intangible assets, net | 21,575 | 21,556 |
Other assets | 1,749 | 8 |
TOTAL ASSETS | 115,367 | 140,320 |
CURRENT LIABILITIES | ' | ' |
Accounts payable and accrued expenses | 31,730 | 37,138 |
Line of credit and current portion of long-term debt (including capital leases) | 1,962 | 770 |
TOTAL CURRENT LIABILITIES | 33,692 | 37,908 |
Long-term debt, less current portion | 47,756 | 64,767 |
Other liabilities | 3,289 | 3,498 |
Deferred tax liabilities | 3,140 | 4,194 |
TOTAL LIABILITIES | 87,877 | 110,367 |
STOCKHOLDERS' EQUITY | ' | ' |
Preferred Stock, $0.0001 par value, 1,000,000 authorized, none issued or outstanding at December 31, 2013 and December 31, 2012 | ' | ' |
Common Stock $0.0001 par value, authorized, issued and outstanding of 49,000,000, 18,257,924, and 17,986,275 at December 31, 2013 and 49,000,000, 18,133,945 and 17,862,296 at December 31, 2012, respectively | 2 | 2 |
Treasury Stock at cost (271,649 shares at December 31, 2013 and 2012) | -1,283 | -1,283 |
Additional paid-in capital | 73,715 | 72,790 |
Accumulated deficit | -44,167 | -41,352 |
Accumulated other comprehensive loss | -777 | -204 |
TOTAL STOCKHOLDERS' EQUITY | 27,490 | 29,953 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $115,367 | $140,320 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Consolidated Balance Sheets | ' | ' |
Trade receivables, allowance for doubtful accounts (in dollars) | $100 | $78 |
Preferred Stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, authorized | 1,000,000 | 1,000,000 |
Preferred Stock, issued | 0 | 0 |
Preferred Stock, outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, authorized | 49,000,000 | 49,000,000 |
Common Stock, issued | 18,257,924 | 18,133,945 |
Common Stock, outstanding | 17,986,275 | 17,862,296 |
Treasury Stock at cost, shares | 271,649 | 271,649 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Consolidated Statements of Operations | ' | ' |
Net sales | $208,173 | $247,227 |
Cost of goods sold | 143,166 | 167,455 |
Gross profit | 65,007 | 79,772 |
General and administrative expenses | 38,022 | 41,674 |
Selling expenses | 20,839 | 29,009 |
Impairment of goodwill and intangible assets | ' | 69,796 |
Depreciation and amortization | 6,280 | 7,566 |
Operating loss | -134 | -68,273 |
Interest expense, net | -3,999 | -4,148 |
Loss before provision for income taxes | -4,133 | -72,421 |
Benefit for income taxes | -1,318 | -6,768 |
NET LOSS | ($2,815) | ($65,653) |
Net loss per share BASIC (in dollars per share) | ($0.16) | ($3.68) |
Weighted average shares outstanding BASIC (in shares) | 17,929,734 | 17,861,169 |
Net loss per share DILUTED (in dollars per share) | ($0.16) | ($3.68) |
Weighted average shares outstanding DILUTED (in shares) | 17,929,734 | 17,861,169 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Consolidated Statements of Comprehensive Loss | ' | ' |
Net loss | ($2,815) | ($65,653) |
Other comprehensive (loss) income: | ' | ' |
Cumulative changes in foreign currency translation adjustments | -573 | 399 |
Comprehensive loss | ($3,388) | ($65,254) |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | ' | ' |
Net loss | ($2,815) | ($65,653) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ' | ' |
Impairment of goodwill and intangible assets | ' | 69,796 |
Change in value of interest rate swap agreements | ' | -88 |
Depreciation and amortization | 6,280 | 7,566 |
Stock-based compensation | 893 | 888 |
Loss on asset disposal | 70 | ' |
Deferred income taxes | -715 | -8,218 |
Changes in assets and liabilities, net of effects of acquisitions | ' | ' |
Decrease in accounts receivable | 10,682 | 2,319 |
Decrease in inventory | 11,426 | 567 |
(Increase) decrease in prepaids and other current assets | 604 | 1,644 |
(Increase) decrease in other assets | -1,744 | 13 |
(Decrease) in accounts payable and accrued expenses | -5,620 | -3,681 |
Net cash provided by operating activities | 19,061 | 5,153 |
Cash flows from investing activities: | ' | ' |
Acquisitions of property and equipment | -3,259 | -5,596 |
Acquisitions of other intangible assets | -1,114 | -510 |
Proceeds from sale of assets | 138 | ' |
Acquisitions, net of cash acquired | -87 | ' |
Net cash used in investing activities | -4,322 | -6,106 |
Cash flows from financing activities: | ' | ' |
Net borrowings of debt | -15,819 | 2,181 |
Issuance of common stock upon exercise of stock options | 32 | 744 |
Net cash (used in) provided by financing activities | -15,787 | 2,925 |
Effect of exchange rate changes on cash and cash equivalents | -511 | -55 |
Net increase in cash and cash equivalents | -1,559 | 1,917 |
Cash and cash equivalents at beginning of year | 3,132 | 1,215 |
Cash and cash equivalents at end of year | 1,573 | 3,132 |
Supplemental disclosure of cash flow information: | ' | ' |
Cash paid during the year for interest | 3,428 | 3,604 |
Cash paid during the year for income taxes | 96 | 980 |
Non cash investing and financing activities: | ' | ' |
Capital lease obligations incurred | ' | $1,507 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock | Additional Paid in Capital | Treasury Stock | Retained Earnings | Accumulated Comprehensive Income (Loss) |
In Thousands, except Share data, unless otherwise specified | ||||||
Balance at Dec. 31, 2011 | $93,902 | $2 | $71,158 | ($956) | $24,301 | ($603) |
Balance (in shares) at Dec. 31, 2011 | ' | 17,576,533 | ' | ' | ' | ' |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' |
Return of common stock-Born Free net asset adjustment | -327 | ' | ' | -327 | ' | ' |
Return of common stock-Born Free net asset adjustment (in shares) | ' | -130,515 | ' | ' | ' | ' |
Issuance of common stock upon vesting of restricted shares (in shares) | ' | 223,000 | ' | ' | ' | ' |
Issuance of common stock upon exercise of stock options | 744 | ' | 744 | ' | ' | ' |
Issuance of common stock upon exercise of stock options (in shares) | ' | 193,278 | ' | ' | ' | ' |
Stock-based compensation | 888 | ' | 888 | ' | ' | ' |
Net loss for the year | -65,653 | ' | ' | ' | -65,653 | ' |
Foreign currency translation adjustment | 399 | ' | ' | ' | ' | 399 |
Balance at Dec. 31, 2012 | 29,953 | 2 | 72,790 | -1,283 | -41,352 | -204 |
Balance (in shares) at Dec. 31, 2012 | ' | 17,862,296 | ' | ' | ' | ' |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' |
Issuance of common stock upon vesting of restricted shares (in shares) | ' | 111,479 | ' | ' | ' | ' |
Issuance of common stock upon exercise of stock options | 32 | ' | 32 | ' | ' | ' |
Issuance of common stock upon exercise of stock options (in shares) | ' | 12,500 | ' | ' | ' | ' |
Stock-based compensation | 893 | ' | 893 | ' | ' | ' |
Net loss for the year | -2,815 | ' | ' | ' | -2,815 | ' |
Foreign currency translation adjustment | -573 | ' | ' | ' | ' | -573 |
Balance at Dec. 31, 2013 | $27,490 | $2 | $73,715 | ($1,283) | ($44,167) | ($777) |
Balance (in shares) at Dec. 31, 2013 | ' | 17,986,275 | ' | ' | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2013 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Operations | |
The Company is a global designer, marketer, and distributor of branded juvenile health, safety and wellness products which are sold principally to large North American and European retailers. The Company currently markets its products in several product categories such as monitoring, safety, nursery, baby gear, feeding products, and furniture. Most products are sold under our core brand names of Summer® and Born Free®. The Company has also marketed certain products under licenses with Carter's®, Disney®, and Garanimals®. Anchor products in these categories include nursery audio/video monitors, safety gates, bath tubs and bathers, durable bath products, bed rails, nursery products, swaddling blankets, baby bottles, warming/sterilization systems, booster and potty seats, bouncers, travel accessories, high chairs, swings, feeding products, car seats, strollers, and nursery furniture. Over the years, the Company has completed several acquisitions and added products such as cribs, swaddling, and feeding to its product categories. | |
Basis of Presentation and Principles of Consolidation | |
It is the Company's policy to prepare its financial statements on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in the consolidation. | |
All dollar amounts included in the Notes to Consolidated Financial Statements are in thousands of U.S. dollars except share and per share amounts. Certain items in prior year financials were reclassified to conform to current year presentation. | |
Summary of Significant Accounting Policies | |
Revenue Recognition | |
The Company records revenue when all of the following occur: persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. Sales are recorded net of provisions for returns and allowances, customer discounts, and other sales related discounts. The Company bases its estimates for discounts, returns and allowances on negotiated customer terms and historical experience. Customers do not have the right to return products unless the products are defective. The Company records a reduction of sales for estimated future defective product deductions based on historical experience. | |
Sales incentives or other consideration given by the Company to customers that are considered adjustments of the selling price of its products, such as markdowns, are reflected as reductions of revenue. Sales incentives and other consideration that represent costs incurred by the Company for assets or services received, such as the appearance of the Company's products in a customer's national circular ad, are reflected as selling and marketing expenses in the accompanying statements of operations. | |
Cash and Cash Equivalents | |
For purposes of the statement of cash flows, cash and cash equivalents include money market accounts and investments with an original maturity of three months or less. At times, the Company possesses cash balances in excess of federally- insured limits. | |
Trade Receivables | |
Trade receivables are carried at their outstanding unpaid principal balances reduced by an allowance for doubtful accounts. The Company estimates doubtful accounts based on historical bad debts, factors related to specific customers' ability to pay and current economic trends. The Company writes off accounts receivable against the allowance when a balance is determined to be uncollectible. | |
Inventory Valuation | |
Inventory is comprised of finished goods and is stated at the lower of cost using the first-in, first-out (FIFO) method, or market (net realizable value). The Company regularly reviews slow-moving and excess inventories, and writes down inventories to net realizable value if the ultimate expected net proceeds from the disposals of excess inventory are less than the carrying cost of the merchandise. | |
Property and Equipment | |
Property and equipment are recorded at cost. The Company owns the tools and molds used in the production of its products by third party manufacturers. Capitalized mold costs include costs incurred for the pre-production design and development of the molds. | |
Depreciation is provided over the estimated useful lives of the respective assets using either straight-line or accelerated methods. | |
Impairment of Long-Lived Assets with Finite Lives | |
The Company reviews long-lived assets with finite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. An asset is considered to be impaired when its carrying amount exceeds both the sum of the undiscounted future net cash flows expected to result from the use of the asset and its eventual disposition and the assets' fair value. Long-lived assets include property and equipment and finite-lived intangible assets. The amount of impairment loss, if any, is charged by the Company to current operations. For each of the years ended December 31, 2013 and 2012, no such impairment existed. | |
Goodwill and Indefinite-Lived Intangible Assets | |
The Company accounts for goodwill and other intangible assets in accordance with accounting guidance that requires that goodwill and intangible assets with indefinite useful lives be tested annually for impairment and more frequently if events or changes in circumstances indicate that the asset might be impaired. The Company's annual impairment testing is conducted in the fourth quarter of every year. | |
The Company tests indefinite-lived intangible assets for impairment by comparing the asset's fair value to its carrying amount. If the fair value is less than the carrying amount, the excess of the carrying amount over fair value is recognized as an impairment charge and the adjusted carrying amount becomes the assets' new accounting basis. | |
Management also evaluates the remaining useful life of an intangible asset that is not being amortized each reporting period to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is subsequently determined to have a finite useful life, it is amortized prospectively over its estimated remaining useful life. | |
The Company tests goodwill for impairment using a two-step process. In the first step, the Company compares the fair value of its single reporting unit with its carrying amount including goodwill. If the fair value of the single reporting unit exceeds its carrying value, the goodwill is considered not impaired, thus rendering unnecessary the second step in impairment testing. If the fair value of the single reporting unit is less than the carrying value, a second step is performed in which the implied fair value of the reporting unit's goodwill is compared to the carrying value of the goodwill. The implied fair value of the goodwill is determined based on the difference between the fair value of the single reporting unit and the net fair value of the identifiable assets and liabilities of the single reporting unit. If the implied fair value of the goodwill is less than the carrying value, the difference is recognized as an impairment charge. The Company had no goodwill in fiscal 2013 and determined that no impairment existed on its indefinite-lived intangible assets for the year ended December 31, 2013. See Note 3 for discussion of the 2012 impairment charge. | |
Fair Value Measurements | |
Previously, the Company adopted ASC 820 Fair Value Measurements and Disclosures which established a new framework for measuring fair value and expanded related disclosures. Broadly, the framework required fair value to be determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The standard established a three-level valuation hierarchy based upon observable and non-observable inputs. | |
Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy: | |
Level 1—Quoted prices for identical instruments in active markets. | |
Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | |
Level 3—Significant inputs to the valuation model are unobservable. | |
The Company maintains policies and procedures to value instruments using the best and most relevant data available. In addition, the Company utilizes risk management resources that review valuation, including independent price validation. | |
The Company has used derivatives to fix interest rates. As a matter of policy, the Company does not use derivatives for speculative purposes. There were no interest rate swap agreements outstanding at December 31, 2013 and at December 31, 2012. | |
The Company's financial instruments include cash and cash equivalents, accounts and notes receivable, accounts payable, accrued expenses, and short and long-term borrowings. Because of their short maturity, the carrying amounts of cash and cash equivalents, accounts and notes receivable, accounts payable, accrued expenses and short-term borrowings approximate fair value. The carrying value of long-term borrowings approximates fair value, which is based on quoted market prices or on rates available to the Company for debt with similar terms and maturities. | |
Income taxes | |
Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence, it is more likely than not that such benefits will be realized. | |
Previously, the Company adopted the provisions of a new standard which provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Tax positions must meet a "more-likely-than-not" recognition threshold at the effective date to be recognized upon adoption and in subsequent periods. Upon the adoption, and at December 31, 2013 and 2012, the Company did not have any uncertain tax positions. No interest and penalties related to uncertain tax positions were accrued at December 31, 2013 and 2012. | |
The Company's federal tax return for the year ended December 31, 2009 was audited in 2012 by the Internal Revenue Service and all taxes and interest have been paid. Any tax penalties or interest is recorded as a general and administrative cost in operations. The Company expects no material changes to unrecognized tax positions within the next twelve months. | |
Translation of Foreign Currencies | |
The assets and liabilities of the Company's European, Canadian, Israeli, and Asian operations have been translated into U.S. dollars at year-end exchange rates and the income and expense accounts of these affiliates have been translated at average rates prevailing during each respective year. Resulting translation adjustments are made to a separate component of stockholders' equity within accumulated other comprehensive income (loss). Foreign exchange transaction gains and losses are included in the statements of operations. | |
Shipping Costs | |
Shipping costs to customers are included in selling expenses and amounted to approximately $1,521 and $2,251 for the years ended December 31, 2013 and 2012, respectively. | |
Advertising Costs | |
The Company charges advertising costs to selling, general and administration expense as incurred. Advertising expense, which consists primarily of promotional and cooperative advertising allowances provided to customers, was approximately $16,791 and $22,558 for the years ended December 31, 2013 and 2012, respectively. | |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Accordingly, actual results could differ from those estimates. | |
Net Income Per Share | |
Basic earnings per share is calculated by dividing net income (loss) for the period by the weighted average number of common stock outstanding during the period. | |
Diluted earnings per share for the Company is computed by dividing net income (loss) by the sum of: the weighted-average number of shares of common stock outstanding during the period; the dilutive impact (using the "treasury stock" method) of "in the money" stock options; and unvested restricted shares issued to employees. Options to purchase 446,000 and 654,421 shares of the Company's common stock and 268,361 and 183,742 of restricted shares were not included in the calculation, due to the fact that these instruments were anti-dilutive for the years ended December 31, 2013 and 2012, respectively. | |
New Accounting Pronouncements | |
In July 2013, the FASB issued an amendment to the accounting guidance related to the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The guidance requires an unrecognized tax benefit to be presented as a decrease in a deferred tax asset where a net operating loss, a similar tax loss, or a tax credit carryforward exists and certain criteria are met. This guidance is effective prospectively for annual and interim reporting periods beginning after December 15, 2013. The Company is in compliance with the adoption of this guidance in its consolidated financial statements. | |
Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements. | |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
PROPERTY AND EQUIPMENT | ' | ||||||||
PROPERTY AND EQUIPMENT | ' | ||||||||
2. PROPERTY AND EQUIPMENT | |||||||||
Property and equipment, at cost, consist of the following: | |||||||||
December 31, | |||||||||
Depreciation/ | |||||||||
2013 | 2012 | Amortization Period | |||||||
Computer-related | $ | 5,672 | $ | 5,388 | 5 years | ||||
Tools, dies prototypes, and molds | 26,372 | 24,722 | 1 - 5 years | ||||||
Building | 4,156 | 4,156 | 30 years | ||||||
Other | 5,584 | 4,493 | various | ||||||
| | | | | | | | | |
41,784 | 38,759 | ||||||||
Less accumulated depreciation | 26,988 | 21,925 | |||||||
| | | | | | | | | |
Property and Equipment, net | $ | 14,796 | $ | 16,834 | |||||
| | | | | | | | | |
| | | | | | | | | |
Property and equipment includes amounts acquired under capital leases of approximately $2,420 and $3,508 at December 31, 2013 and 2012, respectively, with related accumulated depreciation of approximately $605 and $370, respectively. Total depreciation expense was $5,145 and $6,456 for the years ended December 31, 2013 and 2012, respectively. | |||||||||
GOODWILL_AND_INTANGIBLE_ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||
3. GOODWILL AND INTANGIBLE ASSETS | ||||||||
Goodwill | ||||||||
Because the Company has fully integrated its acquisitions, it has determined that it has only one reporting unit for purposes of testing for goodwill impairment. | ||||||||
Due to the sustained decrease in the Company's results of operations (below forecasts) and stock price during the third quarter of 2012, management undertook an interim goodwill and intangible asset impairment analysis and engaged a third party to assist management in testing goodwill and other intangible assets recorded on the balance sheet. | ||||||||
The Step I test for goodwill resulted in the determination that the carrying value of the reporting unit exceeded its fair value thus requiring the Company to measure the amount of any goodwill impairment by performing the second step of the impairment test. Fair value of the reporting unit in Step I was determined based on a combination of a discounted cash flow valuation method as well as the Guideline Public Company Method—Control, Marketable Basis and the Public Traded Shares—Control, Marketable Basis Method. The second step (defined as "Step II") of the goodwill impairment test, used to measure the amount of impairment loss, compared the implied fair value of the single reporting unit goodwill with the carrying amount of that goodwill. The loss recognized cannot exceed the carrying amount of goodwill. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. The Company estimated the fair value of its tangible and intangible assets as part of the process. Intangible assets included trade names, customer relationships and patents. For intangible assets, the Company selected an income approach to value trade names, customer relationships and patents. The customer relationships were valued using a discounted cash flow methodology while the trade names and patents were valued using a relief from royalty method. | ||||||||
As a result of its analysis and the valuation study discussed above, management determined the implied fair value of goodwill was zero and the Company recorded a non-cash goodwill impairment charge of $61,908 in 2012. There was no such charge in 2013. | ||||||||
Intangible assets | ||||||||
As a result of its analysis and the valuation study discussed previously, prior to testing goodwill for impairment, management determined that the estimated fair value of an indefinite lived intangible for a brand name (based on the relief from royalty method of the income approach) was lower than carrying value and recorded a write-down as summarized below. There was no such charge in 2013. | ||||||||
In addition, the Company concluded that certain customer relationship intangible assets valued at $2,346 should be changed from an indefinite-lived intangible asset to a finite-lived intangible asset at the end of the third quarter of 2012, on a prospective basis. In accordance with ASC Topic 350-30-35-17, the Company undertook an intangible asset impairment analysis prior to the reclassification and determined that the fair value of the assets exceeded their carrying value. The customer relationship assets were added in 2008 and 2009 from past acquisitions. As part of this reclassification, the assets were assigned a 20 year estimated useful life and are amortized over a straight-line basis as there was no discernable pattern in which the economic benefits of the intangible asset could be consumed. Amortization began in the fourth quarter of 2012 and is included in the table below. | ||||||||
Intangible assets consist of the following: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Brand names | $ | 14,812 | $ | 22,700 | ||||
Impairment of brand name | — | (7,888 | ) | |||||
| | | | | | | | |
Brand names—net | 14,812 | 14,812 | ||||||
Patents and licenses | 3,378 | 2,221 | ||||||
Customer relationships | 6,946 | 6,946 | ||||||
Other intangibles | 1,882 | 1,882 | ||||||
| | | | | | | | |
27,018 | 25,861 | |||||||
Less: Accumulated amortization | (5,443 | ) | (4,305 | ) | ||||
| | | | | | | | |
Intangible assets, net | $ | 21,575 | $ | 21,556 | ||||
| | | | | | | | |
| | | | | | | | |
The amortization period for the majority of the intangible assets ranges from 5 to 20 years for those assets that have an estimated life; certain of the assets have indefinite lives (brand names). Total of intangibles not subject to amortization amounted to $12,308 for the years ended December 31, 2013 and 2012, respectively. | ||||||||
Amortization expense amounted to $1,135 and $1,110 for the years ended December 31, 2013 and 2012, respectively. Estimated amortization expense for the next five years is as follows: | ||||||||
Year ending December 31, | ||||||||
2014 | $ | 1,084 | ||||||
2015 | 1,031 | |||||||
2016 | 1,031 | |||||||
2017 | 1,031 | |||||||
2018 | 983 |
ACCOUNTS_PAYABLE_AND_ACCRUED_E
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ' | |||||||
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ' | |||||||
4. ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ||||||||
Accounts payable and accrued expenses consist of the following: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Accounts payable | $ | 15,420 | $ | 18,580 | ||||
Customer advertising and allowances | 4,834 | 3,691 | ||||||
Accrued purchases of inventory | 8,321 | 10,739 | ||||||
Other (none in excess of 5% of current liabilities) | 3,155 | 4,128 | ||||||
| | | | | | | | |
Total | $ | 31,730 | $ | 37,138 | ||||
| | | | | | | | |
| | | | | | | | |
DEBT
DEBT | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
DEBT | ' | ||||||
DEBT | ' | ||||||
5. DEBT | |||||||
Credit Facilities | |||||||
On February 28, 2013, the Company and its subsidiary, Summer Infant (USA), Inc., entered into a new loan and security agreement (as amended, the "BofA Agreement") with Bank of America, N.A., as agent, the financial institutions party to the agreement from time to time as lenders, and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as sole lead arranger and sole book runner. The BofA Agreement replaced the Company's prior credit facility with Bank of America. The Company also entered into a term loan with Salus Capital Partners, which is described below under "Term Loan." | |||||||
BofA Agreement | |||||||
The BofA Agreement provides for an $80,000, asset-based revolving credit facility, with a $10,000 letter of credit sub-line facility. The total borrowing capacity is based on a borrowing base, which is defined as 85% of eligible receivables plus the lesser of (i) 70% of the value of eligible inventory or (ii) 85% of the net orderly liquidation value of eligible inventory and less reserves. | |||||||
The scheduled maturity date of loans under the BofA Agreement is February 28, 2018 (subject to customary early termination provisions). All obligations under the BofA Agreement are secured by substantially all the assets of the Company, subject to a first priority lien on certain assets held by the term-loan lender described below. In addition, Summer Infant Canada Limited and Summer Infant Europe Limited, subsidiaries of the Company, are guarantors under the BofA Agreement. Proceeds from the loans were used to satisfy existing debt, pay fees and transaction expenses associated with the closing of the BofA Agreement, pay obligations under the BofA Agreement, and were used to make payments on the Term Loan and for other general corporate purposes, including working capital. | |||||||
Loans under the BofA Agreement bear interest, at the Company's option, at a base rate or at LIBOR, plus applicable margins based on average quarterly availability under the BofA Agreement and ranging between 1.75% and 2.25% on LIBOR borrowings and 0.25% and 0.75% on base rate borrowings. Interest payments are due monthly, payable in arrears. The Company is also required to pay an annual non-use fee of 0.375% of the unused amounts under the BofA Agreement, as well as other customary fees as are set forth in the BofA Agreement. As of December 31, 2013 the base rate on loans was 3.75% and the LIBOR rate was 2.25%. | |||||||
Under the BofA Agreement, the Company is required to comply with certain financial covenants. Prior to an amendment in November 2013 described below, the Company was required, (i) for the first year of the loan, to maintain and earn a specified minimum, monthly consolidated EBITDA amount, with such specified amounts increasing over the first year of the loan to a minimum consolidated EBITDA of $12,000 at February 28, 2014, and (ii) beginning with the fiscal quarter ending March 31, 2014, maintain a fixed charge coverage ratio of at least 1.0 to 1.0 for each period of four fiscal quarters most recently ended. For purposes of the financial covenants, consolidated EBITDA is defined as net income before interest, taxes, depreciation and amortization, plus certain customary expenses, fees and non-cash charges and minus certain customary non-cash items increasing net income. | |||||||
On November 8, 2013, the Company entered into an amendment (the "BofA Amendment") to the BofA Agreement described above. The BofA Amendment amended the financial covenants in the BofA Agreement to provide that (i) the Company is no longer required to comply with the minimum EBITDA covenants for any period ending after September 30, 2013 and (ii) the Company maintain a trailing 12-month fixed charge coverage ratio of at least 1.0 to 1.0, tested on a monthly basis, from and after September 30, 2013. | |||||||
The BofA Agreement contains customary affirmative and negative covenants. Among other restrictions, the Company is restricted in its ability to incur additional debt, make acquisitions or investments, dispose of assets, or make distributions unless in each case certain conditions are satisfied. The BofA Agreement also contains customary events of default, including a cross default with the term loan, the occurrence of a material adverse event and the occurrence or a change of control. In the event of a default, all of the obligations of the Company and its subsidiaries under the BofA Agreement may be declared immediately due and payable. For certain events of default relating to insolvency and receivership, all outstanding obligations would become due and payable. | |||||||
Total borrowing capacity under the BofA Agreement at December 31, 2013 was $47,620 and borrowing availability was $12,842. | |||||||
Prior Bank of America Loan Agreement | |||||||
The BofA Agreement entered into in February 2013 replaced the Company's prior secured credit facility with Bank of America, N.A., as Administrative Agent, as set forth in the Amended and Restated Loan Agreement, dated August 2, 2010, as amended through November 7, 2012 (as amended, the "Prior Loan Agreement"). The Prior Loan Agreement provided for an $80,000 working capital revolving credit facility. The amounts outstanding under the Prior Loan Agreement were paid in full on February 28, 2013. | |||||||
The Company had also entered into various interest rate swap agreements in the past which effectively fixed the interest rates on a portion of the outstanding debt, of which, the last agreement matured on June 7, 2012. In addition, the credit facility had an unused line fee based on the unused amount of the credit facility equal to 25 basis points. | |||||||
The Prior Loan Agreement also contained customary events of default, including a cross default provision and a change of control provision. In the event of a default, all of the obligations of the Company and its subsidiaries under the loan Agreement may be declared immediately due and payable. For certain events of default relating to insolvency and receivership, all outstanding obligations become due and payable. | |||||||
Term Loan | |||||||
On February 28, 2013 the Company and its subsidiary, Summer Infant (USA), Inc., as borrowers, entered into a term-loan agreement (the "Term Loan Agreement") with Salus Capital Partners, LLC, as administrative agent and collateral agent, and each lender from time to time a party to the Term Loan Agreement providing for a $15,000 term-loan (the "Term Loan"). | |||||||
Proceeds from the Term Loan were used to repay certain existing debt, and were also used to finance the acquisition of working capital assets in the ordinary course of business, capital expenditures, and for other general corporate purposes. The Term Loan is secured by certain assets of the Company, including a first priority lien on intellectual property, plant, property and equipment, and a pledge of 65% of the ownership interests in certain subsidiaries of the Company. The Term Loan matures on February 28, 2018. In addition, Summer Infant Canada Limited and Summer Infant Europe Limited, subsidiaries of the Company, are guarantors under the Term Loan Agreement. | |||||||
The principal of the Term Loan is being repaid, on a quarterly basis, in installments of $375, commencing with the quarter ending September 30, 2013, until paid in full on termination. The Term Loan bears interest at an annual rate equal to LIBOR, plus 10%, with a LIBOR floor of 1.25%. Interest payments are due monthly, in arrears. As of December 31, 2013 the interest rate on the Term Loan was 11.25%. | |||||||
The Term Loan Agreement contains customary affirmative and negative covenants substantially the same as the BofA Agreement described above. In addition, prior to the amendment in November 2013 described below, the Company was required to comply with certain financial covenants, including that the Company (i) meet the same minimum, monthly consolidated EBITDA as set forth in the BofA Agreement and (ii) initially maintain a monthly senior leverage ratio of 1:1. For periods after February 28, 2014, the senior leverage ratio will be based on an annual business plan to be approved by the Company's Board of Directors and will be tested monthly on a trailing twelve month basis. For purposes of the financial covenants in the Term Loan Agreement, the senior leverage ratio is the ratio of (1) all amounts outstanding under the Term Loan Agreement and the BofA Agreement to (2) consolidated EBITDA for the twelve-month period ending as of the last day of the most recently ended fiscal month. The Term Loan Agreement also contains events of default, including a cross default with the BofA agreement, the occurrence of a material adverse event, the occurrence of a change of control, and the recall of products having a value of $2,000 or more. In the event of a default, all of the obligations of the Company and its subsidiaries under the Term Loan Agreement may be declared immediately due and payable. For certain events of default relating to insolvency and receivership, all outstanding obligations would become due and payable. | |||||||
On November 8, 2013, the Company entered into an amendment (the "Term Loan Amendment") to the Term Loan Agreement described above. The Term Loan Amendment amended the financial covenants in the Term Loan Agreement to provide that (i) the Company is no longer required to comply with the minimum EBITDA covenants for any period ending after September 30, 2013, (ii) the Company maintain a trailing 12-month fixed charge coverage ratio of at least 1.0 to1.0, tested on a monthly basis, from and after September 30, 2013, and (iii) commencing February 28, 2014, the Company maintain a trailing 12-month senior leverage ratio, tested on a monthly basis of (a) no more than 6.0 to 1.0 for the periods ending on or before June 30, 2014, (b) no more than 5.5 to 1.0 for periods ending July 1, 2014 through September 30, 2014, and (c) no more than 5.0 to 1.0 for periods following September 30, 2014. | |||||||
The amount outstanding on the Term Loan at December 31, 2013 was $14,250. | |||||||
The Company was in compliance with the financial covenants under the BofA Agreement and the Term Loan at December 31, 2013. | |||||||
Aggregate maturities of bank debt related to the BofA credit facility and Term Loan are as follows: | |||||||
Year ending December 31: | 2014 | $ | 1,500 | ||||
| | | | | | | |
2015 | $ | 1,500 | |||||
| | | | | | | |
| | | | | | | |
2016 | $ | 1,500 | |||||
| | | | | | | |
| | | | | | | |
2017 | $ | 1,500 | |||||
| | | | | | | |
| | | | | | | |
2018 | $ | 43,028 | |||||
| | | | | | | |
| | | | | | | |
Total | $ | 49,028 | |||||
| | | | | | | |
| | | | | | | |
Sale-Leaseback | |||||||
On March 24, 2009 the Company entered into a definitive agreement with Faith Realty II, LLC, a Rhode Island limited liability company ("Faith Realty") (the members of which are Jason Macari, the former Chief Executive Officer of the Company and current director, and his spouse), pursuant to which Faith Realty purchased the corporate headquarters of the Company located at 1275 Park East Drive, Woonsocket, Rhode Island (the "Headquarters"), for $4,052 and subsequently leased the Headquarters back to Summer USA for an annual rent of $390 during the initial seven year term of the lease, payable monthly and in advance. The lease will expire on the seventh anniversary of its commencement unless an option period is exercised by Summer USA. At that time, Summer USA will have the opportunity to extend the lease for one additional period of five years. If Summer USA elects to extend the term of the lease for an additional five years, the annual rent for the first two years of the extension term shall be equal to $429 and for the final three years of the extension term shall be equal to $468. In addition, during the first six months of the last lease year of the initial term of the lease, Summer USA has the option to repurchase the Headquarters for $4,457 (110% of the initial sale price). With the majority of the proceeds of the sale of the Headquarters Summer USA paid off the construction loan relating to the Headquarters. Mr. Macari has given a personal guarantee to secure the Faith Realty debt on its mortgage; therefore, due to his continuing involvement in the building transaction and the Company's option to repurchase the building, the transaction has been recorded as a financing lease, with no gain recognition. At December 31, 2013, approximately $225 was included in accounts payable and accrued expenses, with the balance of approximately $3,290 included in other liabilities, in the accompanying consolidated balance sheet. This obligation is reduced each month (along with a charge to interest expense) as the rent payment is made to Faith Realty. | |||||||
On February 25, 2009, the Company's board of Directors (with Mr. Macari abstaining from such action) approved the sale leaseback transaction. In connection therewith, the board granted a potential waiver, to the extent necessary, if at all, of the conflict of interest provisions of the Company's Model Code of Ethics, effective upon execution of definitive agreements within the parameters approved by the Board. In connection with granting such potential waiver, the Board of Directors engaged independent counsel to review the sale leaseback transaction and an independent appraiser to ascertain (i) the value of the Headquarters and (ii) the market rent for the Headquarters. In reaching its conclusion that the sale leaseback transaction is fair to the Company, the Board of Directors considered a number of factors, including Summer USA's ability to repurchase the headquarters at 110% of the initial sale price at the end of the initial term. | |||||||
In addition, the Company's Audit Committee approved the sale leaseback transaction (as a related party transaction) and the potential waiver and recommended the matter to a vote of the entire Board of Directors (which approved the transaction). | |||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INCOME TAXES | ' | |||||||
INCOME TAXES | ' | |||||||
6. INCOME TAXES | ||||||||
The benefit for income taxes is summarized as follows: | ||||||||
2013 | 2012 | |||||||
Current: | ||||||||
Federal | $ | (15 | ) | $ | 633 | |||
Foreign | (599 | ) | 683 | |||||
State and Local | (3 | ) | 79 | |||||
| | | | | | | | |
Total Current | (617 | ) | 1,395 | |||||
Deferred (primarily federal) | (701 | ) | (8,163 | ) | ||||
| | | | | | | | |
Total benefit | $ | (1,318 | ) | $ | (6,768 | ) | ||
| | | | | | | | |
| | | | | | | | |
The tax effects of temporary differences that comprise the deferred tax liabilities and assets are as follows: | ||||||||
2013 | 2012 | |||||||
Assets (Liabilities) | ||||||||
Deferred tax asset—current: | ||||||||
Accounts receivable | $ | 13 | $ | 15 | ||||
Inventory and Unicap reserve | 694 | 921 | ||||||
Foreign tax credit carry-forward and other | 125 | 1,650 | ||||||
Foreign earnings not permanently reinvested (Canada & UK) | — | (1,401 | ) | |||||
| | | | | | | | |
Net deferred tax asset-current | 832 | 1,185 | ||||||
| | | | | | | | |
Deferred tax (liability) asset—non-current: | ||||||||
Research and development credit, foreign tax credit and net operating loss carry-forward | 3,953 | 3,352 | ||||||
Intangible assets and other | (4,008 | ) | (4,242 | ) | ||||
Property, plant and equipment | (1,776 | ) | (2,627 | ) | ||||
| | | | | | | | |
Total deferred tax liability | (1,831 | ) | (3,517 | ) | ||||
Valuation allowance | (1,309 | ) | (677 | ) | ||||
| | | | | | | | |
Net deferred tax liability non-current: | (3,140 | ) | (4,194 | ) | ||||
| | | | | | | | |
Net deferred income tax liability | $ | (2,308 | ) | $ | (3,009 | ) | ||
| | | | | | | | |
| | | | | | | | |
The following reconciles the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit in the consolidated financial statements: | ||||||||
2013 | 2012 | |||||||
Tax benefit at statutory rate | $ | (1,405 | ) | $ | (24,623 | ) | ||
State income taxes, net of U.S. federal income tax benefit | 232 | (556 | ) | |||||
Stock options | 121 | 136 | ||||||
Foreign dividend | — | 321 | ||||||
Goodwill and other intangible asset impairment | — | 17,612 | ||||||
Valuation allowance of state R&D credits | 110 | 1 | ||||||
Foreign tax rate differential | (184 | ) | 45 | |||||
Tax credits | (150 | ) | 9 | |||||
Tax rate changes | — | 160 | ||||||
Non-deductible expenses | 16 | 21 | ||||||
Other | (58 | ) | 106 | |||||
| | | | | | | | |
Total benefit | $ | (1,318 | ) | $ | (6,768 | ) | ||
| | | | | | | | |
| | | | | | | | |
The Company had undistributed earnings from certain foreign subsidiaries (Summer Infant Asia, Summer Infant Australia, and Born Free Holdings, Ltd) of approximately $12,816 at December 31, 2013 which is all considered to be permanently reinvested due to the Company's plans to reinvest such earnings for future expansion in certain foreign jurisdictions. Earnings and Profits from Summer Infant Europe and Summer Infant Canada are not considered to be permanently reinvested due to the bank refinancing as discussed in Note 5—Debt. The cumulative effect in 2013 was $373 and will affect future years based on earnings. The amount of taxes attributable to the permanently reinvested undistributed earnings is not practicably determinable. | ||||||||
As of December 31, 2013, the Company has approximately $259 of federal and state net operating loss carry forwards (or "NOLs") to offset future federal taxable income. The federal NOL will begin to expire in 2028 and the state NOL will begin to expire in 2016. The Company also has approximately $1,410, $12, $244 and $71 of NOLs in Canada, the United Kingdom, Australia, and France which can be carried forward indefinitely. | ||||||||
Authoritative guidance requires a valuation allowance to reduce the deferred tax assets reported, if based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. After consideration of all evidence, including the Company's past earnings history and future earnings forecast, management has determined that a valuation allowance in the amount of $1,310 relating to certain state tax credits is necessary at December 31, 2013. | ||||||||
Upon the adoption, and at December 31, 2013 and 2012, the Company did not have any uncertain tax positions. No interest and penalties related to uncertain tax positions were accrued at December 31, 2013 and 2012. On a global basis, the open tax years subject to examination by major taxing jurisdictions in which the Company operates is between two to six years. The Company expects no material changes to unrecognized tax positions within the next twelve months. | ||||||||
SHARE_BASED_COMPENSATION
SHARE BASED COMPENSATION | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
SHARE BASED COMPENSATION | ' | |||||||||||||||||||
SHARE BASED COMPENSATION | ' | |||||||||||||||||||
7. SHARE BASED COMPENSATION | ||||||||||||||||||||
The Company is authorized to issue up to 3,000,000 shares for equity awards under the 2006 Performance Equity Plan ("2006 Plan") and 500,000 shares for equity awards under the 2012 Incentive Compensation Plan ("2012 Plan"). | ||||||||||||||||||||
Under the 2006 Plan and 2012 Plan, awards may be granted to participants in the form of non-qualified stock options, incentive stock options, restricted stock, deferred stock, restricted stock units and other stock-based awards. Subject to the provisions of the plans, awards may be granted to employees, officers, directors, advisors and consultants who are deemed to have rendered or are able to render significant services to the Company or its subsidiaries and who are deemed to have contributed or to have the potential to contribute to the Company's success. The Company accounts for options under the fair value recognition standard. The application of this standard resulted in share-based compensation expense for the years ended December 31, 2013 and 2012 of $893 and $888, respectively. Stock based compensation expense is included in selling, general and administrative expenses. There were no share-based payment arrangements capitalized as part of the cost of an asset. | ||||||||||||||||||||
The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. The Company uses the simplified method to estimate the expected term of the options, but used an estimate for grants of "plain vanilla" stock options based on a formula prescribed by the SEC. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Share- based compensation expense recognized in the consolidated financial statements in 2013 and 2012 is based on awards that are ultimately expected to vest. | ||||||||||||||||||||
The following table summarizes the weighted average assumptions used for options granted during the year ended December 31, 2013 and 2012. | ||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||
Expected life (in years) | 6 | 6 | ||||||||||||||||||
Risk-free interest rate | 1.71 | % | 1.71 | % | ||||||||||||||||
Volatility | 55 | % | 55 | % | ||||||||||||||||
Dividend yield | 0 | % | 0 | % | ||||||||||||||||
Forfeiture rate | 10 | % | 10 | % | ||||||||||||||||
The weighted-average grant date fair value of options granted during the year ended December 31, 2013 was $1.69 per share which totals $588 for the 348,000 options granted during such period. During the year ended December 31, 2012, the weighted-average grant date fair value of options granted was $2.21 per share which totaled $482 for the 218,428 options granted during the year. | ||||||||||||||||||||
A summary of the status of the Company's options as of December 31, 2013 and changes during the year then ended is presented below: | ||||||||||||||||||||
Number Of | Weighted-Average | |||||||||||||||||||
Shares | Exercise Price | |||||||||||||||||||
Outstanding at beginning of year | 1,187,493 | $ | 4.11 | |||||||||||||||||
Granted | 348,000 | $ | 3.23 | |||||||||||||||||
Exercised | (12,500 | ) | $ | 2.55 | ||||||||||||||||
Canceled | (113,581 | ) | $ | 3.93 | ||||||||||||||||
| | | | | | | | |||||||||||||
Outstanding at end of year | 1,409,412 | $ | 3.92 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Options exercisable at December 31, 2013 | 941,744 | $ | 3.85 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Outstanding stock options expected to vest as of December 31, 2013 is 1,347,000. The intrinsic value of options exercised totaled $3 and $490 for the years ended December 31, 2013 and 2012, respectively. | ||||||||||||||||||||
The following table summarizes information about stock options at December 31, 2013: | ||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||
Range of | Number | Remaining | Weighted | Number | Remaining | Weighted | ||||||||||||||
Exercise Prices | Outstanding | Contractual | Average | Exercisable | Contractual | Average | ||||||||||||||
Life (years) | Exercise | Life | Exercise | |||||||||||||||||
Price | Price | |||||||||||||||||||
$1.89 - $3.00 | 517,000 | 5.6 | $ | 2.2 | 463,500 | 5.3 | $ | 2.17 | ||||||||||||
$3.01 - $4.00 | 273,000 | 9.4 | $ | 3.38 | 0 | 0 | $ | 0 | ||||||||||||
$4.01 - $5.00 | 20,000 | 5.7 | $ | 4.33 | 20,000 | 5.7 | $ | 4.33 | ||||||||||||
$5.01 - $6.00 | 490,862 | 4.9 | $ | 5.32 | 385,419 | 4 | $ | 5.27 | ||||||||||||
$6.01 - $8.00 | 108,550 | 7.3 | $ | 7 | 72,825 | 7.2 | $ | 6.94 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
1,409,412 | 6.2 | $ | 3.92 | 941,744 | 4.9 | $ | 3.85 | |||||||||||||
The aggregate intrinsic value of options outstanding and options exercisable at December 31, 2013 and 2012 are $3 and $0, respectively. | ||||||||||||||||||||
Number of | Weighted | Weighted | ||||||||||||||||||
Options | Average | Average | ||||||||||||||||||
Excercise | Grant Date | |||||||||||||||||||
Price | Fair Value | |||||||||||||||||||
Non-Vested options at December 31, 2012 | 334,672 | $ | 5.17 | $ | 2.7 | |||||||||||||||
Options Granted | 348,000 | 3.23 | 1.69 | |||||||||||||||||
Options Vested | (90,863 | ) | 3.61 | 1.86 | ||||||||||||||||
Options forfeited | (124,141 | ) | 5.11 | 2.65 | ||||||||||||||||
| | | | | | | | | | | ||||||||||
Non-Vested options at December 31, 2013 | 467,668 | $ | 4.04 | $ | 2.13 | |||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
As of December 31, 2013, there was approximately $667 of unrecognized compensation cost related to non-vested stock option awards, which is expected to be recognized over a remaining weighted-average vesting period of 2.8 years. | ||||||||||||||||||||
Restricted stock awards require no payment from the grantee. The related compensation cost of each award is calculated using the market price on the grant date and is expensed equally over the vesting period. A summary of restricted stock awards for the Company's stock incentive plan for the year ended December 31, 2013, is as follows: | ||||||||||||||||||||
Number of | Grant | |||||||||||||||||||
Shares | Date | |||||||||||||||||||
Fair Value | ||||||||||||||||||||
Non-Vested restricted stock awards as of December 31, 2012 | 186,127 | $ | 5.19 | |||||||||||||||||
Granted | 224,750 | 3.25 | ||||||||||||||||||
Vested | (111,484 | ) | 4.35 | |||||||||||||||||
Forfeited | (31,032 | ) | 3.64 | |||||||||||||||||
| | | | | | | | |||||||||||||
Non-Vested restricted stock awards as of December 31, 2013 | 268,361 | $ | 4.09 | |||||||||||||||||
| | | | | | | | |||||||||||||
As of December 31, 2013, there was approximately $742 of unrecognized compensation cost related to non-vested stock compensation arrangements granted under the Company's stock incentive plan for restricted stock awards. That cost is expected to be recognized over the next 2.6 years. | ||||||||||||||||||||
As of December 31, 2013, there are 132,470 shares available to grant under the 2006 Plan and 469,500 shares available to grant under the 2012 Plan. | ||||||||||||||||||||
CAPITAL_LEASE_OBLIGATIONS
CAPITAL LEASE OBLIGATIONS | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
CAPITAL LEASE OBLIGATIONS | ' | |||||||||||||||||||
CAPITAL LEASE OBLIGATIONS | ' | |||||||||||||||||||
8. CAPITAL LEASE OBLIGATIONS | ||||||||||||||||||||
The Company leases certain equipment under capital leases which expire over the next several years. | ||||||||||||||||||||
The leases require monthly payments of principal and interest, imputed at interest rates ranging from 3% to 18% per annum. | ||||||||||||||||||||
The capital lease liability balance of approximately $678 and $1,437 is included in debt on the consolidated balance sheets as of December 31, 2013 and 2012, respectively, (of which approximately $228 is included in long-term debt each year, and the balance is in current portion of long-term debt). The minimum future lease payments, including principal and interest, are approximately $715 and $1,574, respectively. | ||||||||||||||||||||
Future Minimum Lease Payments | ||||||||||||||||||||
Total | 2014 | 2015 | 2016 | 2017 | 2018 & | |||||||||||||||
Beyond | ||||||||||||||||||||
Capital Lease Payments | $ | 715 | $ | 460 | $ | 168 | $ | 85 | $ | 2 | $ | — | ||||||||
Interest | (37 | ) | (28 | ) | (7 | ) | (2 | ) | ( | ) | — | |||||||||
| | | | | | | | | | | | | | | | | | | | |
Principal | $ | 678 | $ | 432 | $ | 161 | $ | 83 | $ | 2 | $ | — |
PROFIT_SHARING_PLAN
PROFIT SHARING PLAN | 12 Months Ended |
Dec. 31, 2013 | |
PROFIT SHARING PLAN | ' |
PROFIT SHARING PLAN | ' |
9. PROFIT SHARING PLAN | |
Summer Infant (USA), Inc maintains a defined contribution salary deferral plan (the Plan) under Section 401(k) of the Internal Revenue Code. All employees who meet the Plan's eligibility requirements can participate. Employees may elect to make contributions up to 25% of their compensation. In 2007, the Company adopted a matching plan which was funded throughout the year. For the years ended December 31, 2013 and 2012, the Company recorded 401(k) matching expense of $226 and $196, respectively. | |
MAJOR_CUSTOMERS
MAJOR CUSTOMERS | 12 Months Ended |
Dec. 31, 2013 | |
MAJOR CUSTOMERS | ' |
MAJOR CUSTOMERS | ' |
10. MAJOR CUSTOMERS | |
Three customers generated more than 10% of sales for the year ended December 31, 2013, Toys R Us (31%), Walmart (19%), and Target (11%). Three customers generated more than 10% of sales for the year ended December 31, 2012, Toys R Us (36%), Walmart (19%), and Target (10%). Because of the concentration of our business with these customers and because we have no long term contracts with these customers, our success depends on our customers' willingness to purchase and provide shelf space for our products. | |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
11. COMMITMENTS AND CONTINGENCIES | |||||
Royalty Commitments | |||||
Summer Infant (USA), Inc has entered into various license agreements with third parties for the use of product designs, software licenses, and trade names for the products manufactured by the Company. These agreements have termination dates through December 2017. Royalty expense under these licensing agreements for the years ended December 31, 2013 and 2012 were approximately $1,847 and $3,831, respectively. | |||||
Customer Agreements | |||||
The Company enters into annual agreements with its customers in the normal course of business. These agreements define the terms of product sales including in some instances cooperative advertising costs and product return privileges (for defective products only) or defective allowances (which are based upon historical experience). These contracts are generally annual in nature and obligate the Company only as to products actually sold to the customer. | |||||
Lease Commitments | |||||
For lease agreements with escalation clauses, the Company records the total rent to be paid under the lease on a straight-line basis over the term of the lease, with the difference between the expense recognized and the cash paid recorded as a deferred rent liability included in accounts payable and accrued expenses on the balance sheet for amounts to be recognized within twelve months and in other liabilities for amounts to be recognized after twelve months from the balance sheet date, in the consolidated balance sheets. Lease incentives are recorded as deferred rent at the beginning of the lease term and recognized as a reduction of rent expense over the term of the lease. | |||||
Summer Infant Europe Limited leases office space under a non-cancelable operating lease agreement. This lease is for a five-year term through April 2017, and requires monthly payments of approximately $6. In addition, Summer Infant Europe Limited is required to pay its proportionate share of property taxes. | |||||
Summer Infant Canada, Ltd. entered into a five-year lease for office and warehouse space under a non-cancelable operating lease agreement expiring June 2018. The Company is obligated as part of the lease to pay maintenance expenses as well as property taxes and insurance costs as defined in the agreement. Monthly payments are approximately $29 over the course of the lease term. Summer Infant Canada, Ltd. has the option to renew this lease for one additional period of five years under similar terms and conditions. | |||||
Summer Infant (USA) Inc. entered into a 72 month lease in September 2010 for warehouse space under a non-cancelable operating lease agreement. The Company is obligated to pay certain common area maintenance charges including insurance and utilities. The initial lease term is 10 months of free rent followed by 6 monthly payments of approximately $64 and escalate over the course of the lease term. | |||||
During November 2013, Summer Infant Asia entered into a two year office lease which requires monthly payments of $9 through October 2015. | |||||
Approximate future minimum rental payments due under these leases are as follows(a): | |||||
Year Ending | |||||
December 31, 2014 | $ | 1,910 | |||
December 31, 2015 | 1,952 | ||||
December 31, 2016 | 1,382 | ||||
December 31, 2017 | 360 | ||||
December 31, 2018 | 172 | ||||
| | | | | |
Total | $ | 5,776 | |||
| | | | | |
| | | | | |
(a) | |||||
Amounts exclude payments for Sales-Leaseback transaction as described in Note 5. | |||||
Rent expense (excluding taxes, fees and other charges) for the years ended December 31, 2013 and 2012 totaled approximately $1,915 and $1,878, respectively. | |||||
Employment Contracts | |||||
In accordance with United Kingdom and EU law, Summer Infant Europe Limited has employment contracts with all employees. In connection with these contracts, Summer Infant Europe Limited is required to fund the individual pension contributions of certain employees at varying rates from 5% to 10% of the employee' s annual salary, as part of their total compensation package. These pension contributions are expensed as incurred. There are no termination benefit provisions in these contracts. | |||||
Litigation | |||||
In 2012, the Company settled a purported class action suit relating to its analog baby video monitors and paid $1,675 (of which $506 was covered by insurance) in exchange for a release of all claims by the class members. The Company recorded a $1,501 charge in the fourth quarter of 2011 relating to the settlement. | |||||
The Company is a party to routine litigation and administrative complaints incidental to its business. The Company does not believe that the resolution of any or all of such routine litigation and administrative complaints is like to have a material adverse effect on the Company's financial condition or results of operations. | |||||
GEOGRAPHICAL_INFORMATION
GEOGRAPHICAL INFORMATION | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GEOGRAPHICAL INFORMATION | ' | |||||||
GEOGRAPHICAL INFORMATION | ' | |||||||
12. GEOGRAPHICAL INFORMATION | ||||||||
The Company sells products throughout the United States, Canada, and the United Kingdom, and various other parts of the world. The Company does not disclose product line revenues as it is not practicable for the Company to do so. | ||||||||
The following is a table that presents net revenue by geographic area: | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
United States | $ | 174,253 | $ | 210,242 | ||||
All Other | 33,920 | 36,985 | ||||||
| | | | | | | | |
$ | 208,173 | $ | 247,227 | |||||
| | | | | | | | |
| | | | | | | | |
The following is a table that presents total assets by geographic area: | ||||||||
2013 | 2012 | |||||||
United States | $ | 94,033 | $ | 116,424 | ||||
All Other | 21,334 | 23,896 | ||||||
| | | | | | | | |
$ | 115,367 | $ | 140,320 | |||||
| | | | | | | | |
| | | | | | | | |
The following is a table that presents total long lived assets by geographic area: | ||||||||
2013 | 2012 | |||||||
United States | $ | 30,858 | $ | 31,462 | ||||
All Other | 7,263 | 6,936 | ||||||
| | | | | | | | |
$ | 38,121 | $ | 38,398 | |||||
| | | | | | | | |
| | | | | | | | |
ACQUISITION_OF_BORN_FREE_HOLDI
ACQUISITION OF BORN FREE HOLDINGS LTD. | 12 Months Ended |
Dec. 31, 2013 | |
ACQUISITION OF BORN FREE HOLDINGS LTD. | ' |
ACQUISITION OF BORN FREE HOLDINGS LTD. | ' |
13. ACQUISITION OF BORN FREE HOLDINGS LTD. | |
On March 24, 2011, the Company acquired all of the capital stock of Born Free Holdings Ltd. ("Born Free") pursuant to the terms and conditions of a Stock Purchase Agreement (the "Purchase Agreement") by and among the Company, its wholly owned subsidiary Summer Infant (USA), Inc., Born Free and the stockholders of Born Free. The aggregate consideration paid by the Company to the Born Free stockholders at closing was $24,607 (subject to adjustment), consisting of $14,000 in cash and approximately $10,607 in shares of the Company's common stock, or 1,510,989 shares based on a price per share of $7.02 (the closing price on the date of acquisition). In addition, the Born Free stockholders could receive earn-out payments upon achievement of certain financial targets over the twelve months subsequent to the acquisition up to a maximum amount of $13,000, of which up to $6,500 would be paid in shares of the Company's common stock (or 925,926 shares based on a price per share of $7.02). A portion of the shares issued at closing was, deposited in escrow for a period of 18 months as security for any breach of the representations, warranties and covenants of Born Free and the Born Free stockholders contained in the Purchase Agreement. On September 30, 2011 the Company received $1,000 in common stock from the Born Free escrow account due to a preliminary net asset adjustment as defined in the Purchase Agreement. This was accounted for on the balance sheet through an increase in acquired accrued liabilities by $1,000, and increasing treasury stock by $956 and goodwill by $44. | |
On August 15, 2012, the Company settled all outstanding claims related to the net asset adjustment and earn-out provisions in the Purchase Agreement, resulting in a charge to general and administrative expense of approximately $453. The settlement included finalizing the net asset adjustment in the amount of $1,400. This adjustment also resulted in an increase to treasury stock of $327 reflecting additional shares (130,515) returned to the Company. In addition, there was no payment required under the earn-out provision of the Purchase Agreement. As a result of this final settlement, the Company does not expect any future liability under the net asset adjustment or earn-out provisions under the Purchase Agreement. | |
The results of operations of Born Free are included in the results of the Company from the date of acquisition forward. | |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2013 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
14. SUBSEQUENT EVENTS | |
The Company has evaluated all events or transactions that occurred after December 31, 2013 through the date of this Annual Report. No subsequent event disclosures are required. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
Revenue Recognition | ' |
Revenue Recognition | |
The Company records revenue when all of the following occur: persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. Sales are recorded net of provisions for returns and allowances, customer discounts, and other sales related discounts. The Company bases its estimates for discounts, returns and allowances on negotiated customer terms and historical experience. Customers do not have the right to return products unless the products are defective. The Company records a reduction of sales for estimated future defective product deductions based on historical experience. | |
Sales incentives or other consideration given by the Company to customers that are considered adjustments of the selling price of its products, such as markdowns, are reflected as reductions of revenue. Sales incentives and other consideration that represent costs incurred by the Company for assets or services received, such as the appearance of the Company's products in a customer's national circular ad, are reflected as selling and marketing expenses in the accompanying statements of operations. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents | |
For purposes of the statement of cash flows, cash and cash equivalents include money market accounts and investments with an original maturity of three months or less. At times, the Company possesses cash balances in excess of federally- insured limits. | |
Trade Receivables | ' |
Trade Receivables | |
Trade receivables are carried at their outstanding unpaid principal balances reduced by an allowance for doubtful accounts. The Company estimates doubtful accounts based on historical bad debts, factors related to specific customers' ability to pay and current economic trends. The Company writes off accounts receivable against the allowance when a balance is determined to be uncollectible. | |
Inventory Valuation | ' |
Inventory Valuation | |
Inventory is comprised of finished goods and is stated at the lower of cost using the first-in, first-out (FIFO) method, or market (net realizable value). The Company regularly reviews slow-moving and excess inventories, and writes down inventories to net realizable value if the ultimate expected net proceeds from the disposals of excess inventory are less than the carrying cost of the merchandise. | |
Property and Equipment | ' |
Property and Equipment | |
Property and equipment are recorded at cost. The Company owns the tools and molds used in the production of its products by third party manufacturers. Capitalized mold costs include costs incurred for the pre-production design and development of the molds. | |
Depreciation is provided over the estimated useful lives of the respective assets using either straight-line or accelerated methods. | |
Impairment of Long-Lived Assets with Finite Lives | ' |
Impairment of Long-Lived Assets with Finite Lives | |
The Company reviews long-lived assets with finite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. An asset is considered to be impaired when its carrying amount exceeds both the sum of the undiscounted future net cash flows expected to result from the use of the asset and its eventual disposition and the assets' fair value. Long-lived assets include property and equipment and finite-lived intangible assets. The amount of impairment loss, if any, is charged by the Company to current operations. For each of the years ended December 31, 2013 and 2012, no such impairment existed. | |
Goodwill and Indefinite-Lived Intangible Assets | ' |
Goodwill and Indefinite-Lived Intangible Assets | |
The Company accounts for goodwill and other intangible assets in accordance with accounting guidance that requires that goodwill and intangible assets with indefinite useful lives be tested annually for impairment and more frequently if events or changes in circumstances indicate that the asset might be impaired. The Company's annual impairment testing is conducted in the fourth quarter of every year. | |
The Company tests indefinite-lived intangible assets for impairment by comparing the asset's fair value to its carrying amount. If the fair value is less than the carrying amount, the excess of the carrying amount over fair value is recognized as an impairment charge and the adjusted carrying amount becomes the assets' new accounting basis. | |
Management also evaluates the remaining useful life of an intangible asset that is not being amortized each reporting period to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is subsequently determined to have a finite useful life, it is amortized prospectively over its estimated remaining useful life. | |
The Company tests goodwill for impairment using a two-step process. In the first step, the Company compares the fair value of its single reporting unit with its carrying amount including goodwill. If the fair value of the single reporting unit exceeds its carrying value, the goodwill is considered not impaired, thus rendering unnecessary the second step in impairment testing. If the fair value of the single reporting unit is less than the carrying value, a second step is performed in which the implied fair value of the reporting unit's goodwill is compared to the carrying value of the goodwill. The implied fair value of the goodwill is determined based on the difference between the fair value of the single reporting unit and the net fair value of the identifiable assets and liabilities of the single reporting unit. If the implied fair value of the goodwill is less than the carrying value, the difference is recognized as an impairment charge. The Company had no goodwill in fiscal 2013 and determined that no impairment existed on its indefinite-lived intangible assets for the year ended December 31, 2013. See Note 3 for discussion of the 2012 impairment charge. | |
Fair Value Measurements | ' |
Fair Value Measurements | |
Previously, the Company adopted ASC 820 Fair Value Measurements and Disclosures which established a new framework for measuring fair value and expanded related disclosures. Broadly, the framework required fair value to be determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The standard established a three-level valuation hierarchy based upon observable and non-observable inputs. | |
Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy: | |
Level 1—Quoted prices for identical instruments in active markets. | |
Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | |
Level 3—Significant inputs to the valuation model are unobservable. | |
The Company maintains policies and procedures to value instruments using the best and most relevant data available. In addition, the Company utilizes risk management resources that review valuation, including independent price validation. | |
The Company has used derivatives to fix interest rates. As a matter of policy, the Company does not use derivatives for speculative purposes. There were no interest rate swap agreements outstanding at December 31, 2013 and at December 31, 2012. | |
The Company's financial instruments include cash and cash equivalents, accounts and notes receivable, accounts payable, accrued expenses, and short and long-term borrowings. Because of their short maturity, the carrying amounts of cash and cash equivalents, accounts and notes receivable, accounts payable, accrued expenses and short-term borrowings approximate fair value. The carrying value of long-term borrowings approximates fair value, which is based on quoted market prices or on rates available to the Company for debt with similar terms and maturities. | |
Income taxes | ' |
Income taxes | |
Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence, it is more likely than not that such benefits will be realized. | |
Previously, the Company adopted the provisions of a new standard which provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Tax positions must meet a "more-likely-than-not" recognition threshold at the effective date to be recognized upon adoption and in subsequent periods. Upon the adoption, and at December 31, 2013 and 2012, the Company did not have any uncertain tax positions. No interest and penalties related to uncertain tax positions were accrued at December 31, 2013 and 2012. | |
The Company's federal tax return for the year ended December 31, 2009 was audited in 2012 by the Internal Revenue Service and all taxes and interest have been paid. Any tax penalties or interest is recorded as a general and administrative cost in operations. The Company expects no material changes to unrecognized tax positions within the next twelve months. | |
Translation of Foreign Currencies | ' |
Translation of Foreign Currencies | |
The assets and liabilities of the Company's European, Canadian, Israeli, and Asian operations have been translated into U.S. dollars at year-end exchange rates and the income and expense accounts of these affiliates have been translated at average rates prevailing during each respective year. Resulting translation adjustments are made to a separate component of stockholders' equity within accumulated other comprehensive income (loss). Foreign exchange transaction gains and losses are included in the statements of operations. | |
Shipping Costs | ' |
Shipping Costs | |
Shipping costs to customers are included in selling expenses and amounted to approximately $1,521 and $2,251 for the years ended December 31, 2013 and 2012, respectively. | |
Advertising Costs | ' |
Advertising Costs | |
The Company charges advertising costs to selling, general and administration expense as incurred. Advertising expense, which consists primarily of promotional and cooperative advertising allowances provided to customers, was approximately $16,791 and $22,558 for the years ended December 31, 2013 and 2012, respectively. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Accordingly, actual results could differ from those estimates. | |
Net Income Per Share | ' |
Net Income Per Share | |
Basic earnings per share is calculated by dividing net income (loss) for the period by the weighted average number of common stock outstanding during the period. | |
Diluted earnings per share for the Company is computed by dividing net income (loss) by the sum of: the weighted-average number of shares of common stock outstanding during the period; the dilutive impact (using the "treasury stock" method) of "in the money" stock options; and unvested restricted shares issued to employees. Options to purchase 446,000 and 654,421 shares of the Company's common stock and 268,361 and 183,742 of restricted shares were not included in the calculation, due to the fact that these instruments were anti-dilutive for the years ended December 31, 2013 and 2012, respectively. | |
New Accounting Pronouncements | ' |
New Accounting Pronouncements | |
In July 2013, the FASB issued an amendment to the accounting guidance related to the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The guidance requires an unrecognized tax benefit to be presented as a decrease in a deferred tax asset where a net operating loss, a similar tax loss, or a tax credit carryforward exists and certain criteria are met. This guidance is effective prospectively for annual and interim reporting periods beginning after December 15, 2013. The Company is in compliance with the adoption of this guidance in its consolidated financial statements. | |
Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements. | |
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
PROPERTY AND EQUIPMENT | ' | ||||||||
Schedule of property and equipment, at cost | ' | ||||||||
December 31, | |||||||||
Depreciation/ | |||||||||
2013 | 2012 | Amortization Period | |||||||
Computer-related | $ | 5,672 | $ | 5,388 | 5 years | ||||
Tools, dies prototypes, and molds | 26,372 | 24,722 | 1 - 5 years | ||||||
Building | 4,156 | 4,156 | 30 years | ||||||
Other | 5,584 | 4,493 | various | ||||||
| | | | | | | | | |
41,784 | 38,759 | ||||||||
Less accumulated depreciation | 26,988 | 21,925 | |||||||
| | | | | | | | | |
Property and Equipment, net | $ | 14,796 | $ | 16,834 | |||||
| | | | | | | | | |
| | | | | | | | | |
GOODWILL_AND_INTANGIBLE_ASSETS1
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||
Schedule of intangible assets | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Brand names | $ | 14,812 | $ | 22,700 | ||||
Impairment of brand name | — | (7,888 | ) | |||||
| | | | | | | | |
Brand names—net | 14,812 | 14,812 | ||||||
Patents and licenses | 3,378 | 2,221 | ||||||
Customer relationships | 6,946 | 6,946 | ||||||
Other intangibles | 1,882 | 1,882 | ||||||
| | | | | | | | |
27,018 | 25,861 | |||||||
Less: Accumulated amortization | (5,443 | ) | (4,305 | ) | ||||
| | | | | | | | |
Intangible assets, net | $ | 21,575 | $ | 21,556 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of estimated amortization expense for the next five years | ' | |||||||
Year ending December 31, | ||||||||
2014 | $ | 1,084 | ||||||
2015 | 1,031 | |||||||
2016 | 1,031 | |||||||
2017 | 1,031 | |||||||
2018 | 983 |
ACCOUNTS_PAYABLE_AND_ACCRUED_E1
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ' | |||||||
Schedule of accounts payable and accrued expenses | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Accounts payable | $ | 15,420 | $ | 18,580 | ||||
Customer advertising and allowances | 4,834 | 3,691 | ||||||
Accrued purchases of inventory | 8,321 | 10,739 | ||||||
Other (none in excess of 5% of current liabilities) | 3,155 | 4,128 | ||||||
| | | | | | | | |
Total | $ | 31,730 | $ | 37,138 | ||||
| | | | | | | | |
| | | | | | | | |
DEBT_Tables
DEBT (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
DEBT | ' | ||||||
Schedule of aggregate maturities of bank debt | ' | ||||||
Year ending December 31: | 2014 | $ | 1,500 | ||||
| | | | | | | |
2015 | $ | 1,500 | |||||
| | | | | | | |
| | | | | | | |
2016 | $ | 1,500 | |||||
| | | | | | | |
| | | | | | | |
2017 | $ | 1,500 | |||||
| | | | | | | |
| | | | | | | |
2018 | $ | 43,028 | |||||
| | | | | | | |
| | | | | | | |
Total | $ | 49,028 | |||||
| | | | | | | |
| | | | | | | |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
INCOME TAXES | ' | |||||||
Schedule of benefit for income taxes | ' | |||||||
2013 | 2012 | |||||||
Current: | ||||||||
Federal | $ | (15 | ) | $ | 633 | |||
Foreign | (599 | ) | 683 | |||||
State and Local | (3 | ) | 79 | |||||
| | | | | | | | |
Total Current | (617 | ) | 1,395 | |||||
Deferred (primarily federal) | (701 | ) | (8,163 | ) | ||||
| | | | | | | | |
Total benefit | $ | (1,318 | ) | $ | (6,768 | ) | ||
| | | | | | | | |
| | | | | | | | |
Schedule of tax effects of temporary differences that comprise the deferred tax liabilities and assets | ' | |||||||
2013 | 2012 | |||||||
Assets (Liabilities) | ||||||||
Deferred tax asset—current: | ||||||||
Accounts receivable | $ | 13 | $ | 15 | ||||
Inventory and Unicap reserve | 694 | 921 | ||||||
Foreign tax credit carry-forward and other | 125 | 1,650 | ||||||
Foreign earnings not permanently reinvested (Canada & UK) | — | (1,401 | ) | |||||
| | | | | | | | |
Net deferred tax asset-current | 832 | 1,185 | ||||||
| | | | | | | | |
Deferred tax (liability) asset—non-current: | ||||||||
Research and development credit, foreign tax credit and net operating loss carry-forward | 3,953 | 3,352 | ||||||
Intangible assets and other | (4,008 | ) | (4,242 | ) | ||||
Property, plant and equipment | (1,776 | ) | (2,627 | ) | ||||
| | | | | | | | |
Total deferred tax liability | (1,831 | ) | (3,517 | ) | ||||
Valuation allowance | (1,309 | ) | (677 | ) | ||||
| | | | | | | | |
Net deferred tax liability non-current: | (3,140 | ) | (4,194 | ) | ||||
| | | | | | | | |
Net deferred income tax liability | $ | (2,308 | ) | $ | (3,009 | ) | ||
| | | | | | | | |
| | | | | | | | |
Schedule of reconciliation of the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit | ' | |||||||
2013 | 2012 | |||||||
Tax benefit at statutory rate | $ | (1,405 | ) | $ | (24,623 | ) | ||
State income taxes, net of U.S. federal income tax benefit | 232 | (556 | ) | |||||
Stock options | 121 | 136 | ||||||
Foreign dividend | — | 321 | ||||||
Goodwill and other intangible asset impairment | — | 17,612 | ||||||
Valuation allowance of state R&D credits | 110 | 1 | ||||||
Foreign tax rate differential | (184 | ) | 45 | |||||
Tax credits | (150 | ) | 9 | |||||
Tax rate changes | — | 160 | ||||||
Non-deductible expenses | 16 | 21 | ||||||
Other | (58 | ) | 106 | |||||
| | | | | | | | |
Total benefit | $ | (1,318 | ) | $ | (6,768 | ) | ||
| | | | | | | | |
| | | | | | | | |
SHARE_BASED_COMPENSATION_Table
SHARE BASED COMPENSATION (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
SHARE BASED COMPENSATION | ' | |||||||||||||||||||
Schedule of weighted average assumptions used for options and shares granted | ' | |||||||||||||||||||
2013 | 2012 | |||||||||||||||||||
Expected life (in years) | 6 | 6 | ||||||||||||||||||
Risk-free interest rate | 1.71 | % | 1.71 | % | ||||||||||||||||
Volatility | 55 | % | 55 | % | ||||||||||||||||
Dividend yield | 0 | % | 0 | % | ||||||||||||||||
Forfeiture rate | 10 | % | 10 | % | ||||||||||||||||
Stock options and restricted shares | ' | |||||||||||||||||||
Summary of status of the Company's options and changes during the period | ' | |||||||||||||||||||
Number Of | Weighted-Average | |||||||||||||||||||
Shares | Exercise Price | |||||||||||||||||||
Outstanding at beginning of year | 1,187,493 | $ | 4.11 | |||||||||||||||||
Granted | 348,000 | $ | 3.23 | |||||||||||||||||
Exercised | (12,500 | ) | $ | 2.55 | ||||||||||||||||
Canceled | (113,581 | ) | $ | 3.93 | ||||||||||||||||
| | | | | | | | |||||||||||||
Outstanding at end of year | 1,409,412 | $ | 3.92 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Options exercisable at December 31, 2013 | 941,744 | $ | 3.85 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Summary of stock options | ' | |||||||||||||||||||
The following table summarizes information about stock options at December 31, 2013: | ||||||||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||
Range of | Number | Remaining | Weighted | Number | Remaining | Weighted | ||||||||||||||
Exercise Prices | Outstanding | Contractual | Average | Exercisable | Contractual | Average | ||||||||||||||
Life (years) | Exercise | Life | Exercise | |||||||||||||||||
Price | Price | |||||||||||||||||||
$1.89 - $3.00 | 517,000 | 5.6 | $ | 2.2 | 463,500 | 5.3 | $ | 2.17 | ||||||||||||
$3.01 - $4.00 | 273,000 | 9.4 | $ | 3.38 | 0 | 0 | $ | 0 | ||||||||||||
$4.01 - $5.00 | 20,000 | 5.7 | $ | 4.33 | 20,000 | 5.7 | $ | 4.33 | ||||||||||||
$5.01 - $6.00 | 490,862 | 4.9 | $ | 5.32 | 385,419 | 4 | $ | 5.27 | ||||||||||||
$6.01 - $8.00 | 108,550 | 7.3 | $ | 7 | 72,825 | 7.2 | $ | 6.94 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
1,409,412 | 6.2 | $ | 3.92 | 941,744 | 4.9 | $ | 3.85 | |||||||||||||
Stock option | ' | |||||||||||||||||||
Stock options and restricted shares | ' | |||||||||||||||||||
Schedule of non-vested activity | ' | |||||||||||||||||||
Number of | Weighted | Weighted | ||||||||||||||||||
Options | Average | Average | ||||||||||||||||||
Excercise | Grant Date | |||||||||||||||||||
Price | Fair Value | |||||||||||||||||||
Non-Vested options at December 31, 2012 | 334,672 | $ | 5.17 | $ | 2.7 | |||||||||||||||
Options Granted | 348,000 | 3.23 | 1.69 | |||||||||||||||||
Options Vested | (90,863 | ) | 3.61 | 1.86 | ||||||||||||||||
Options forfeited | (124,141 | ) | 5.11 | 2.65 | ||||||||||||||||
| | | | | | | | | | | ||||||||||
Non-Vested options at December 31, 2013 | 467,668 | $ | 4.04 | $ | 2.13 | |||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Restricted shares | ' | |||||||||||||||||||
Stock options and restricted shares | ' | |||||||||||||||||||
Schedule of non-vested activity | ' | |||||||||||||||||||
Number of | Grant | |||||||||||||||||||
Shares | Date | |||||||||||||||||||
Fair Value | ||||||||||||||||||||
Non-Vested restricted stock awards as of December 31, 2012 | 186,127 | $ | 5.19 | |||||||||||||||||
Granted | 224,750 | 3.25 | ||||||||||||||||||
Vested | (111,484 | ) | 4.35 | |||||||||||||||||
Forfeited | (31,032 | ) | 3.64 | |||||||||||||||||
| | | | | | | | |||||||||||||
Non-Vested restricted stock awards as of December 31, 2013 | 268,361 | $ | 4.09 | |||||||||||||||||
| | | | | | | |
CAPITAL_LEASE_OBLIGATIONS_Tabl
CAPITAL LEASE OBLIGATIONS (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
CAPITAL LEASE OBLIGATIONS | ' | |||||||||||||||||||
Schedule of future minimum lease payments | ' | |||||||||||||||||||
Total | 2014 | 2015 | 2016 | 2017 | 2018 & | |||||||||||||||
Beyond | ||||||||||||||||||||
Capital Lease Payments | $ | 715 | $ | 460 | $ | 168 | $ | 85 | $ | 2 | $ | — | ||||||||
Interest | (37 | ) | (28 | ) | (7 | ) | (2 | ) | ( | ) | — | |||||||||
| | | | | | | | | | | | | | | | | | | | |
Principal | $ | 678 | $ | 432 | $ | 161 | $ | 83 | $ | 2 | $ | — |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
Schedule of future minimum rental payments due under leases | ' | ||||
Year Ending | |||||
December 31, 2014 | $ | 1,910 | |||
December 31, 2015 | 1,952 | ||||
December 31, 2016 | 1,382 | ||||
December 31, 2017 | 360 | ||||
December 31, 2018 | 172 | ||||
| | | | | |
Total | $ | 5,776 | |||
| | | | | |
| | | | | |
(a) | |||||
Amounts exclude payments for Sales-Leaseback transaction as described in Note 5. | |||||
GEOGRAPHICAL_INFORMATION_Table
GEOGRAPHICAL INFORMATION (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
GEOGRAPHICAL INFORMATION | ' | |||||||
Schedule of net revenue by geographic area | ' | |||||||
December 31, | ||||||||
2013 | 2012 | |||||||
United States | $ | 174,253 | $ | 210,242 | ||||
All Other | 33,920 | 36,985 | ||||||
| | | | | | | | |
$ | 208,173 | $ | 247,227 | |||||
| | | | | | | | |
| | | | | | | | |
Schedule of total assets by geographic area | ' | |||||||
2013 | 2012 | |||||||
United States | $ | 94,033 | $ | 116,424 | ||||
All Other | 21,334 | 23,896 | ||||||
| | | | | | | | |
$ | 115,367 | $ | 140,320 | |||||
| | | | | | | | |
| | | | | | | | |
Schedule of total long lived assets by geographic area | ' | |||||||
2013 | 2012 | |||||||
United States | $ | 30,858 | $ | 31,462 | ||||
All Other | 7,263 | 6,936 | ||||||
| | | | | | | | |
$ | 38,121 | $ | 38,398 | |||||
| | | | | | | | |
| | | | | | | | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
item | item | |
Impairment of Long-Lived Assets with Finite Lives | ' | ' |
Impairment of Long-Lived Assets with Finite Lives | $0 | $0 |
Goodwill and Indefinite Lived Intangible Assets | ' | ' |
Goodwill | 0 | ' |
Impairment of indefinite-lived intangible assets | 0 | ' |
Fair Value Measurements | ' | ' |
Number of interest rate swap agreements still active | 0 | 0 |
Income taxes | ' | ' |
Accrued interest and penalties relating to uncertain tax positions | 0 | 0 |
Estimated change in unrecognized tax benefits within the next twelve months | 0 | ' |
Shipping Costs | ' | ' |
Shipping costs to customers | 1,521 | 2,251 |
Advertising Costs | ' | ' |
Advertising costs | $16,791 | $22,558 |
Stock option | ' | ' |
Net Income Per Share | ' | ' |
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 446,000 | 654,421 |
Restricted shares | ' | ' |
Net Income Per Share | ' | ' |
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 268,361 | 183,742 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Property and equipment | ' | ' |
Property and Equipment, gross | $41,784 | $38,759 |
Less accumulated depreciation | 26,988 | 21,925 |
Property and Equipment, net | 14,796 | 16,834 |
Total depreciation expense | 5,145 | 6,456 |
Computer-related | ' | ' |
Property and equipment | ' | ' |
Property and Equipment, gross | 5,672 | 5,388 |
Depreciation/Amortization Period | 'P5Y | ' |
Tools dies prototypes and molds | ' | ' |
Property and equipment | ' | ' |
Property and Equipment, gross | 26,372 | 24,722 |
Tools dies prototypes and molds | Minimum | ' | ' |
Property and equipment | ' | ' |
Depreciation/Amortization Period | 'P1Y | ' |
Tools dies prototypes and molds | Maximum | ' | ' |
Property and equipment | ' | ' |
Depreciation/Amortization Period | 'P5Y | ' |
Building | ' | ' |
Property and equipment | ' | ' |
Property and Equipment, gross | 4,156 | 4,156 |
Depreciation/Amortization Period | 'P30Y | ' |
Other | ' | ' |
Property and equipment | ' | ' |
Property and Equipment, gross | 5,584 | 4,493 |
Property and equipment acquired under capital leases | ' | ' |
Property and equipment | ' | ' |
Less accumulated depreciation | 605 | 370 |
Property and Equipment, net | $2,420 | $3,508 |
GOODWILL_AND_INTANGIBLE_ASSETS2
GOODWILL AND INTANGIBLE ASSETS (Details) (USD $) | 12 Months Ended | 3 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
item | Minimum | Maximum | Patents and licenses | Patents and licenses | Customer relationships | Customer relationships | Customer relationships | Other intangibles | Other intangibles | Brand name | Brand name | ||
GOODWILL AND INTANGIBLE ASSETS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of reporting units for purposes of testing goodwill impairment | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of goodwill | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment of goodwill | 0 | 61,908 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets reclassification | ' | ' | ' | ' | ' | ' | 2,346 | ' | ' | ' | ' | ' | ' |
Amortization period of intangible assets | ' | ' | '5 years | '20 years | ' | ' | ' | '20 years | ' | ' | ' | ' | ' |
Intangible assets, gross | 27,018 | 25,861 | ' | ' | 3,378 | 2,221 | ' | 6,946 | 6,946 | 1,882 | 1,882 | 14,812 | 22,700 |
Impairment | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | -7,888 |
Less: Accumulated amortization | -5,443 | -4,305 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets, net | 21,575 | 21,556 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,812 | 14,812 |
Intangibles not subject to amortization | 12,308 | 12,308 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense | 1,135 | 1,110 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 1,084 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 1,031 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 1,031 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 1,031 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | $983 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
ACCOUNTS_PAYABLE_AND_ACCRUED_E2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) (USD $) | 12 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 |
Current Liabilities | |||
Minimum | |||
Major customers | ' | ' | ' |
Accounts payable | $18,580 | $15,420 | ' |
Customer advertising and allowances | 3,691 | 4,834 | ' |
Accrued purchases of inventory | 10,739 | 8,321 | ' |
Other (none in excess of 5% of current liabilities) | 4,128 | 3,155 | ' |
Total | 37,138 | 31,730 | ' |
Percentage of current liabilities | 5.00% | ' | 5.00% |
Amount of Other Accounts Payable and Accrued Expenses exceeding 5% of current liabilities | $0 | $0 | ' |
DEBT_Details
DEBT (Details) (USD $) | Dec. 31, 2013 | Feb. 28, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Nov. 08, 2013 | Nov. 08, 2013 | Nov. 08, 2013 | Nov. 08, 2013 | Nov. 08, 2013 | Feb. 28, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Feb. 28, 2013 | Dec. 31, 2013 | Nov. 08, 2013 | Nov. 08, 2013 |
In Thousands, unless otherwise specified | Term Loan | Term Loan | Term Loan | Term Loan | Term Loan | Amended term loan | Amended term loan | Amended term loan | Amended term loan | Amended term loan | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | BofA Agreement | Asset-based revolving credit facility | Letter of credit sub-line facility | Prior Loan Agreement | Amended BofA agreement | Amended BofA agreement | |
LIBOR | Minimum | Minimum | Maximum | Maximum | Maximum | LIBOR | Base rate | Minimum | Minimum | Maximum | Maximum | At February 28, 2014 | Beginning with the fiscal quarter ending March 31, 2014 | Minimum | ||||||||||||
Leverage ratio for the period ending on or before June 30, 2014 | Leverage ratio for periods ending July 1, 2014 through September 30, 2014 | Leverage ratio for periods following September 30, 2014 | LIBOR | Base rate | LIBOR | Base rate | ||||||||||||||||||||
Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of credit available | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $80,000 | $10,000 | $80,000 | ' | ' |
Borrowing base as a percentage of eligible receivables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing base as a percentage of eligible inventory | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 70.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing base as a percentage of net orderly liquidation value of eligible inventory and less reserves | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Variable interest rate base | ' | ' | ' | ' | 'LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | 'base rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Applicable margin (as a percent) | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.75% | 0.25% | 2.25% | 0.75% | ' | ' | ' | ' | ' | ' | ' |
Unused line fee based on the unused amount of the credit facilities (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.38% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.25% | ' | ' |
Variable rate basis at the end of the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.25% | 3.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
EBITDA to be maintained and earned | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,000 | ' | ' | ' | ' | ' | ' |
Fixed charge coverage ratio | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | 1 |
Period of fixed charge coverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' |
Trailing period for EBITDA | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' |
Current amount of credit available | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 47,620 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Available borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,842 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of debt | ' | 15,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interests in subsidiaries pledged (as a percent) | ' | 65.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount required to be paid on a quarterly basis | ' | ' | 375 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Variable interest rate floor | ' | ' | ' | ' | 1.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate at period end | ' | ' | ' | 11.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior leverage ratio | ' | 1 | ' | ' | ' | ' | ' | ' | 6 | 5.5 | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trailing period for testing senior leverage ratio | ' | '12 months | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period used in calculating the consolidated EBITDA under covenants | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Default event that may require Term Loan repayment if occurred, product recall value | ' | ' | ' | ' | ' | 2,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding | 49,028 | ' | ' | 14,250 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate maturities of bank debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 1,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 1,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 1,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 1,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | 43,028 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | $49,028 | ' | ' | $14,250 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
DEBT_Details_2
DEBT (Details 2) (USD $) | 0 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 24, 2009 | Dec. 31, 2013 |
item | ||
Accounts payable and accrued expenses | ' | ' |
Sale-Leaseback | ' | ' |
Financing lease obligation | ' | $225 |
Other liabilities | ' | ' |
Sale-Leaseback | ' | ' |
Financing lease obligation | ' | 3,290 |
Summer Infant (USA), Inc. | ' | ' |
Sale-Leaseback | ' | ' |
Annual rent | 390 | ' |
Initial term of lease | '7 years | ' |
Number of additional periods | ' | 1 |
Additional lease period | ' | '5 years |
First extended term | ' | '2 years |
Annual rent for first extended term | ' | 429 |
Final extended term | ' | '3 years |
Annual rent for the final extended term | ' | 468 |
Term of the last lease year of initial term, in which the entity has the option to repurchase headquarters | ' | '6 months |
Repurchase price | ' | 4,457 |
Repurchase price as a percentage of the initial sale price | ' | 110.00% |
Sale-leaseback definitive agreement with Faith Realty II, LLC | ' | ' |
Sale-Leaseback | ' | ' |
Sale proceeds | $4,052 | ' |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Current: | ' | ' |
Federal | ($15) | $633 |
Foreign | -599 | 683 |
State and Local | -3 | 79 |
Total Current | -617 | 1,395 |
Deferred (primarily federal) | -701 | -8,163 |
Total benefit | -1,318 | -6,768 |
Deferred tax asset-current: | ' | ' |
Accounts receivable | 13 | 15 |
Inventory and Unicap reserve | 694 | 921 |
Foreign tax credit carry-forward and other | 125 | 1,650 |
Foreign earnings not permanently reinvested (Canada & UK) | ' | -1,401 |
Net deferred tax asset-current | 832 | 1,185 |
Deferred tax (liability) asset-non-current: | ' | ' |
Research and development credit, foreign tax credit and net operating loss carry-forward | 3,953 | 3,352 |
Intangible assets and other | -4,008 | -4,242 |
Property, plant and equipment | -1,776 | -2,627 |
Total deferred tax liability | -1,831 | -3,517 |
Valuation allowance | -1,309 | -677 |
Net deferred tax liability non-current: | -3,140 | -4,194 |
Net deferred income tax liability | -2,308 | -3,009 |
Reconciliation of the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit | ' | ' |
Tax benefit at statutory rate | -1,405 | -24,623 |
State income taxes, net of U.S. federal income tax benefit | 232 | -556 |
Stock options | 121 | 136 |
Foreign dividend | ' | 321 |
Goodwill and other intangible asset impairment | ' | 17,612 |
Valuation allowance of state R&D credits | 110 | 1 |
Foreign tax rate differential | -184 | 45 |
Tax credits | -150 | 9 |
Tax rate changes | ' | 160 |
Non-deductible expenses | 16 | 21 |
Other | -58 | 106 |
Total benefit | -1,318 | -6,768 |
Undistributed earnings from foreign subsidiary | 12,816 | ' |
Cumulative effect of undistributed earnings from foreign subsidiary | 373 | ' |
Net operating loss carryforwards | ' | ' |
Accrued interest and penalties relating to uncertain tax positions | 0 | 0 |
Estimated change in unrecognized tax benefits within the next twelve months | 0 | ' |
Minimum | ' | ' |
Net operating loss carryforwards | ' | ' |
Period subject to examination by major taxing jurisdictions | '2 years | ' |
Maximum | ' | ' |
Net operating loss carryforwards | ' | ' |
Period subject to examination by major taxing jurisdictions | '6 years | ' |
Federal and state | ' | ' |
Net operating loss carryforwards | ' | ' |
Net operating loss carryforwards, amount | 259 | ' |
Canada | ' | ' |
Net operating loss carryforwards | ' | ' |
Net operating loss carryforwards, amount | 1,410 | ' |
United Kingdom | ' | ' |
Net operating loss carryforwards | ' | ' |
Net operating loss carryforwards, amount | 12 | ' |
Australia | ' | ' |
Net operating loss carryforwards | ' | ' |
Net operating loss carryforwards, amount | 244 | ' |
France | ' | ' |
Net operating loss carryforwards | ' | ' |
Net operating loss carryforwards, amount | $71 | ' |
SHARE_BASED_COMPENSATION_Detai
SHARE BASED COMPENSATION (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
2006 Plan and 2012 Plan | ' | ' |
Stock options and restricted shares | ' | ' |
Share-based compensation expense (in dollars) | $893 | $888 |
Share-based compensation costs capitalized | 0 | ' |
2006 Plan and 2012 Plan | Stock option | ' | ' |
Weighted average assumptions | ' | ' |
Expected life (in years) | '6 years | '6 years |
Risk-free interest rate (as a percent) | 1.71% | 1.71% |
Volatility (as a percent) | 55.00% | 55.00% |
Dividend yield (as a percent) | 0.00% | 0.00% |
Forfeiture rate (as a percent) | 10.00% | 10.00% |
Weighted-average grant date fair value of options granted (in dollars per share) | $1.69 | $2.21 |
Total grant date fair value (in dollars) | 588 | 482 |
Number Of Shares | ' | ' |
Outstanding at beginning of year (in shares) | 1,187,493 | ' |
Granted (in shares) | 348,000 | 218,428 |
Exercised (in shares) | -12,500 | ' |
Canceled (in shares) | -113,581 | ' |
Outstanding at end of year (in shares) | 1,409,412 | 1,187,493 |
Options exercisable at the end of the period (in shares) | 941,744 | ' |
Weighted-Average Exercise Price | ' | ' |
Outstanding at beginning of period (in dollars per share) | $4.11 | ' |
Granted (in dollars per share) | $3.23 | ' |
Exercised (in dollars per share) | $2.55 | ' |
Canceled (in dollars per share) | $3.93 | ' |
Outstanding at end of year (in dollars per share) | $3.92 | $4.11 |
Options exercisable at the end of the period (in dollars per share) | $3.85 | ' |
Outstanding stock options expected to vest (in shares) | 1,347,000 | ' |
Intrinsic value of options exercised (in dollars) | $3 | $490 |
2006 Plan | ' | ' |
Stock options and restricted shares | ' | ' |
Number of shares authorized under the plan | 3,000,000 | ' |
2012 Incentive Compensation Plan | ' | ' |
Stock options and restricted shares | ' | ' |
Number of shares authorized under the plan | 500,000 | ' |
SHARE_BASED_COMPENSATION_Detai1
SHARE BASED COMPENSATION (Details 2) (2006 Plan and 2012 Plan, USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Options Outstanding | ' | ' |
Number Outstanding (in shares) | 1,409,412 | ' |
Remaining Contractual Life | '6 years 2 months 12 days | ' |
Weighted Average Exercise Price (in dollars per share) | $3.92 | ' |
Aggregate intrinsic value of options outstanding (in dollars) | $3 | $0 |
Options Exercisable | ' | ' |
Number Exercisable (in shares) | 941,744 | ' |
Remaining Contractual Life | '4 years 10 months 24 days | ' |
Weighted Average Exercise Price (in dollars per share) | $3.85 | ' |
Aggregate intrinsic value of options exercisable (in dollars) | $3 | $0 |
$1.89 $3.00 | ' | ' |
Stock options outstanding and exercisable by exercise price range | ' | ' |
Exercise price, low end of range (in dollars per share) | $1.89 | ' |
Exercise price, high end of range (in dollars per share) | $3 | ' |
Options Outstanding | ' | ' |
Number Outstanding (in shares) | 517,000 | ' |
Remaining Contractual Life | '5 years 7 months 6 days | ' |
Weighted Average Exercise Price (in dollars per share) | $2.20 | ' |
Options Exercisable | ' | ' |
Number Exercisable (in shares) | 463,500 | ' |
Remaining Contractual Life | '5 years 3 months 18 days | ' |
Weighted Average Exercise Price (in dollars per share) | $2.17 | ' |
$3.01 $4.00 | ' | ' |
Stock options outstanding and exercisable by exercise price range | ' | ' |
Exercise price, low end of range (in dollars per share) | $3.01 | ' |
Exercise price, high end of range (in dollars per share) | $4 | ' |
Options Outstanding | ' | ' |
Number Outstanding (in shares) | 273,000 | ' |
Remaining Contractual Life | '9 years 4 months 24 days | ' |
Weighted Average Exercise Price (in dollars per share) | $3.38 | ' |
Options Exercisable | ' | ' |
Number Exercisable (in shares) | 0 | ' |
Remaining Contractual Life | '0 years | ' |
Weighted Average Exercise Price (in dollars per share) | $0 | ' |
$4.01 $5.00 | ' | ' |
Stock options outstanding and exercisable by exercise price range | ' | ' |
Exercise price, low end of range (in dollars per share) | $4.01 | ' |
Exercise price, high end of range (in dollars per share) | $5 | ' |
Options Outstanding | ' | ' |
Number Outstanding (in shares) | 20,000 | ' |
Remaining Contractual Life | '5 years 8 months 12 days | ' |
Weighted Average Exercise Price (in dollars per share) | $4.33 | ' |
Options Exercisable | ' | ' |
Number Exercisable (in shares) | 20,000 | ' |
Remaining Contractual Life | '5 years 8 months 12 days | ' |
Weighted Average Exercise Price (in dollars per share) | $4.33 | ' |
$5.01 $6.00 | ' | ' |
Stock options outstanding and exercisable by exercise price range | ' | ' |
Exercise price, low end of range (in dollars per share) | $5.01 | ' |
Exercise price, high end of range (in dollars per share) | $6 | ' |
Options Outstanding | ' | ' |
Number Outstanding (in shares) | 490,862 | ' |
Remaining Contractual Life | '4 years 10 months 24 days | ' |
Weighted Average Exercise Price (in dollars per share) | $5.32 | ' |
Options Exercisable | ' | ' |
Number Exercisable (in shares) | 385,419 | ' |
Remaining Contractual Life | '4 years | ' |
Weighted Average Exercise Price (in dollars per share) | $5.27 | ' |
$6.01 $8.00 | ' | ' |
Stock options outstanding and exercisable by exercise price range | ' | ' |
Exercise price, low end of range (in dollars per share) | $6.01 | ' |
Exercise price, high end of range (in dollars per share) | $8 | ' |
Options Outstanding | ' | ' |
Number Outstanding (in shares) | 108,550 | ' |
Remaining Contractual Life | '7 years 3 months 18 days | ' |
Weighted Average Exercise Price (in dollars per share) | $7 | ' |
Options Exercisable | ' | ' |
Number Exercisable (in shares) | 72,825 | ' |
Remaining Contractual Life | '7 years 2 months 12 days | ' |
Weighted Average Exercise Price (in dollars per share) | $6.94 | ' |
SHARE_BASED_COMPENSATION_Detai2
SHARE BASED COMPENSATION (Details 3) (2006 Plan and 2012 Plan, Stock option, USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
2006 Plan and 2012 Plan | Stock option | ' | ' |
Number of Options | ' | ' |
Non-Vested options at the beginning of the period (in shares) | 334,672 | ' |
Options Granted (in shares) | 348,000 | 218,428 |
Options Vested (in shares) | -90,863 | ' |
Options forfeited (in shares) | -124,141 | ' |
Non-Vested options at the end of the period (in shares) | 467,668 | 334,672 |
Weighted Average Exercise Price | ' | ' |
Non-Vested options at the beginning of the period (in dollars per share) | $5.17 | ' |
Options Granted (in dollars per share) | $3.23 | ' |
Options Vested (in dollars per share) | $3.61 | ' |
Options forfeited (in dollars per share) | $5.11 | ' |
Non-Vested options at the end of the period (in dollars per share) | $4.04 | $5.17 |
Weighted Average Grant Date Fair Value | ' | ' |
Non-Vested options at the beginning of the period (in dollars per share) | $2.70 | ' |
Options Granted (in dollars per share) | $1.69 | $2.21 |
Options Vested (in dollars per share) | $1.86 | ' |
Options forfeited (in dollars per share) | $2.65 | ' |
Non-Vested options at the end of the period (in dollars per share) | $2.13 | $2.70 |
Share based compensation, additional information | ' | ' |
Unrecognized compensation cost | $667 | ' |
Weighted average vesting period for recognition of unrecognized cost | '2 years 9 months 18 days | ' |
SHARE_BASED_COMPENSATION_Detai3
SHARE BASED COMPENSATION (Details 4) (USD $) | 12 Months Ended |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 |
Restricted shares | ' |
Stock options and restricted shares | ' |
Payment from grantee | $0 |
2006 Plan and 2012 Plan | Restricted shares | ' |
Number of Shares | ' |
Non Vested restricted stock awards at the beginning of the period (in shares) | 186,127 |
Granted (in shares) | 224,750 |
Vested (in shares) | -111,484 |
Forfeited (in shares) | -31,032 |
Non Vested restricted stock awards at the end of the period (in shares) | 268,361 |
Grant Date Fair Value | ' |
Non Vested restricted stock awards at the beginning of the period (in dollars per share) | $5.19 |
Granted (in dollars per share) | $3.25 |
Vested (in dollars per share) | $4.35 |
Forfeited (in dollars per share) | $3.64 |
Non Vested restricted stock awards at the end of the period (in dollars per share) | $4.09 |
Restricted stock awards, additional disclosure | ' |
Unrecognized compensation cost | $742 |
Weighted average vesting period for recognition of unrecognized cost | '2 years 7 months 6 days |
2006 Plan | ' |
Additional information related to share based compensation | ' |
Shares available to grant | 132,470 |
2012 Incentive Compensation Plan | ' |
Additional information related to share based compensation | ' |
Shares available to grant | 469,500 |
CAPITAL_LEASE_OBLIGATIONS_Deta
CAPITAL LEASE OBLIGATIONS (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
CAPITAL LEASE OBLIGATIONS | ' | ' |
Imputed interest rate, low end of range (as a percent) | 3.00% | ' |
Imputed interest rate, high end range (as a percent) | 18.00% | ' |
Capital lease liability included in debt | $678 | $1,437 |
Capital lease liability included in long-term debt | 228 | ' |
Future Minimum Lease Payments | ' | ' |
Total | 715 | 1,574 |
2014 | 460 | ' |
2015 | 168 | ' |
2016 | 85 | ' |
2017 | 2 | ' |
Interest | ' | ' |
Total | -37 | ' |
2014 | -28 | ' |
2015 | -7 | ' |
2016 | -2 | ' |
Principal | ' | ' |
Total | 678 | ' |
2014 | 432 | ' |
2015 | 161 | ' |
2016 | 83 | ' |
2017 | $2 | ' |
PROFIT_SHARING_PLAN_Details
PROFIT SHARING PLAN (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
PROFIT SHARING PLAN | ' | ' |
Maximum employee contributions as a percentage of compensation | 25.00% | ' |
Matching expense | $226 | $196 |
MAJOR_CUSTOMERS_Details
MAJOR CUSTOMERS (Details) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
item | item | |
Major customers | ' | ' |
Percentage of concentration risk | ' | 5.00% |
Sales | Customer concentration risk | ' | ' |
Major customers | ' | ' |
Number of customers | 3 | 3 |
Percentage of concentration risk | 10.00% | 10.00% |
Sales | Customer concentration risk | Toys R Us | ' | ' |
Major customers | ' | ' |
Percentage of concentration risk | 31.00% | 36.00% |
Sales | Customer concentration risk | Walmart | ' | ' |
Major customers | ' | ' |
Percentage of concentration risk | 19.00% | 19.00% |
Sales | Customer concentration risk | Target | ' | ' |
Major customers | ' | ' |
Percentage of concentration risk | 11.00% | 10.00% |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | |||||||
In Thousands, unless otherwise specified | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Nov. 30, 2013 |
Summer Infant (USA), Inc. | Summer Infant (USA), Inc. | Summer Infant (USA), Inc. | Summer Infant Europe Limited | Summer Infant Europe Limited | Summer Infant Europe Limited | Summer Infant Europe Limited | Summer Infant Canada, Ltd. | Summer Infant Asia | ||||
Warehouse space | Minimum | Maximum | Office | Office and warehouse space | Office | |||||||
item | item | |||||||||||
Commitments and contingencies | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Royalty expense | ' | ' | ' | $1,847 | $3,831 | ' | ' | ' | ' | ' | ' | ' |
Term of lease agreement | ' | ' | ' | ' | ' | '72 months | ' | ' | ' | '5 years | '5 years | '2 years |
Amount of monthly rent payments | ' | ' | ' | ' | ' | 64 | ' | ' | ' | 6 | 29 | 9 |
Number of additional periods for which the lease can be renewed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Additional period for which the lease can be renewed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' |
Number of months of free rent under initial lease term | ' | ' | ' | ' | ' | '10 months | ' | ' | ' | ' | ' | ' |
Number of monthly payments | ' | ' | ' | ' | ' | 9 | ' | ' | ' | ' | ' | ' |
Future minimum rental payments due under leases | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
31-Dec-14 | ' | 1,910 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
31-Dec-15 | ' | 1,952 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
31-Dec-16 | ' | 1,382 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
31-Dec-17 | ' | 360 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
31-Dec-18 | ' | 172 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | ' | 5,776 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Rent expense (excluding taxes, fees and other charges) | ' | 1,915 | 1,878 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Employment Contracts | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Employer's contribution as a percentage of employee's annual salary | ' | ' | ' | ' | ' | ' | ' | 5.00% | 10.00% | ' | ' | ' |
Termination benefit provisions | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' |
Settlement amount paid | ' | ' | 1,675 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount covered by insurance | ' | ' | 506 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Charge related to analog baby video monitors | $1,501 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
GEOGRAPHICAL_INFORMATION_Detai
GEOGRAPHICAL INFORMATION (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Geographical information | ' | ' |
Net revenue | $208,173 | $247,227 |
Assets | 115,367 | 140,320 |
Long lived assets | 38,121 | 38,398 |
United States | ' | ' |
Geographical information | ' | ' |
Net revenue | 174,253 | 210,242 |
Assets | 94,033 | 116,424 |
Long lived assets | 30,858 | 31,462 |
All Other | ' | ' |
Geographical information | ' | ' |
Net revenue | 33,920 | 36,985 |
Assets | 21,334 | 23,896 |
Long lived assets | $7,263 | $6,936 |
ACQUISITION_OF_BORN_FREE_HOLDI1
ACQUISITION OF BORN FREE HOLDINGS LTD (Details) (USD $) | 0 Months Ended | 0 Months Ended | 1 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Aug. 15, 2012 | Dec. 31, 2013 | Mar. 24, 2011 | Sep. 30, 2011 | Mar. 31, 2011 | Sep. 30, 2011 |
Born Free | Born Free | Born Free | Born Free | |||
Common Stock | ||||||
Acquisition | ' | ' | ' | ' | ' | ' |
Total aggregate consideration | ' | ' | $24,607 | ' | ' | ' |
Consideration paid in cash | ' | ' | 14,000 | ' | ' | ' |
Stock consideration value before adjustment | ' | ' | 10,607 | ' | ' | ' |
Number of shares issued at closing | ' | ' | 1,510,989 | ' | ' | ' |
Price at which shares was issued (in dollars per share) | ' | ' | $7.02 | ' | ' | ' |
Period for achievement of certain financial targets | ' | ' | ' | ' | '12 months | ' |
Maximum amount of earn-out payments | ' | 0 | 13,000 | ' | ' | ' |
Maximum amount of earn-out payments to be paid in shares | ' | ' | 6,500 | ' | ' | ' |
Maximum earn-out payments to be paid in shares | ' | ' | 925,926 | ' | ' | ' |
Earn-out payments (in dollars per share) | ' | ' | $7.02 | ' | ' | ' |
Period for amount to be deposited in escrow | ' | ' | ' | ' | '18 months | ' |
Amount received in common stock from Born Free escrow account due to a preliminary net asset adjustment | ' | ' | ' | ' | ' | 1,000 |
Increase in acquired accrued liabilities | ' | ' | ' | 1,000 | ' | ' |
Increase in treasury stock | 327 | ' | ' | 956 | ' | ' |
Increase in goodwill | ' | ' | ' | 44 | ' | ' |
Outstanding claims and contingencies settled | 453 | ' | ' | ' | ' | ' |
Net asset adjustment | $1,400 | ' | ' | ' | ' | ' |
Increase in treasury stock shares | 130,515 | ' | ' | ' | ' | ' |