Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 03, 2015 | Feb. 17, 2015 | Jun. 30, 2014 |
Document and Entity Information | |||
Entity Registrant Name | Summer Infant, Inc. | ||
Entity Central Index Key | 1314772 | ||
Document Type | 10-K | ||
Document Period End Date | 3-Jan-15 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -2 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $33.10 | ||
Entity Common Stock, Shares Outstanding | 18,440,934 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jan. 03, 2015 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ||
Cash and cash equivalents | $1,272 | $1,573 |
Trade receivables, net of allowance for doubtful accounts of $159 and $100 at January 3, 2015 and December 31, 2013 respectively | 38,794 | 34,574 |
Inventory, net | 44,010 | 38,378 |
Prepaids and other current assets | 2,076 | 1,890 |
Deferred tax assets | 1,194 | 832 |
TOTAL CURRENT ASSETS | 87,346 | 77,247 |
Property and equipment, net | 13,080 | 14,796 |
Intangible assets, net | 20,679 | 21,575 |
Other assets | 1,362 | 1,749 |
TOTAL ASSETS | 122,467 | 115,367 |
CURRENT LIABILITIES | ||
Accounts payable | 21,878 | 22,072 |
Accrued expenses | 8,628 | 9,658 |
Current portion of long term and capital leases | 1,641 | 1,962 |
TOTAL CURRENT LIABILITIES | 32,147 | 33,692 |
Long-term debt, less current portion | 57,097 | 47,756 |
Other liabilities | 2,994 | 3,289 |
Deferred tax liabilities | 2,378 | 3,140 |
TOTAL LIABILITIES | 94,616 | 87,877 |
STOCKHOLDERS' EQUITY | ||
Preferred Stock, $0.0001 par value, 1,000,000 authorized, none issued or outstanding at January 3, 2015 and December 31, 2013, respectively | ||
Common Stock $0.0001 par value, authorized, issued and outstanding of 49,000,000, 18,415,934, and 18,144,285 at January 3, 2015 and 49,000,000, 18,257,924, and 17,986,275 at December 31, 2013, respectively | 2 | 2 |
Treasury Stock at cost (271,649 shares at January 3, 2015 and December 31, 2013) | -1,283 | -1,283 |
Additional paid-in capital | 74,954 | 73,715 |
Accumulated deficit | -44,412 | -44,167 |
Accumulated other comprehensive loss | -1,410 | -777 |
TOTAL STOCKHOLDERS' EQUITY | 27,851 | 27,490 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $122,467 | $115,367 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jan. 03, 2015 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Condensed Consolidated Balance Sheets | ||
Trade receivables, allowance for doubtful accounts (in dollars) | $159 | $100 |
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 | 18,415,934 | 18,257,924 |
Common Stock, outstanding | 18,144,285 | 17,986,275 |
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 | Jan. 03, 2015 | Dec. 31, 2013 |
Condensed Consolidated Statements of Operations | ||
Net sales | $205,359 | $208,173 |
Cost of goods sold | 138,418 | 143,166 |
Gross profit | 66,941 | 65,007 |
General and administrative expenses | 40,273 | 38,022 |
Selling expenses | 18,437 | 20,839 |
Depreciation and amortization | 5,548 | 6,280 |
Operating income (loss) | 2,683 | -134 |
Interest expense, net | 3,455 | 3,999 |
Loss before provision for income taxes | -772 | -4,133 |
(Benefit) for income taxes | -527 | -1,318 |
NET LOSS | ($245) | ($2,815) |
Net loss per share BASIC (in dollars per share) | ($0.01) | ($0.16) |
Weighted average shares outstanding BASIC (in shares) | 18,060,799 | 17,929,734 |
Net loss per share DILUTED (in dollars per share) | ($0.01) | ($0.16) |
Weighted average shares outstanding DILUTED (in shares) | 18,060,799 | 17,929,734 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
Condensed Consolidated Statements of Comprehensive Loss | ||
Net loss | ($245) | ($2,815) |
Other comprehensive loss: | ||
Changes in foreign currency translation adjustments | -633 | -573 |
Comprehensive loss | ($878) | ($3,388) |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
Cash flows from operating activities: | ||
Net loss | ($245) | ($2,815) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities | ||
Depreciation and amortization | 5,548 | 6,280 |
Stock-based compensation | 1,220 | 893 |
Loss on asset disposal | 70 | |
Deferred income taxes | -1,130 | -715 |
Changes in assets and liabilities, net of effects of acquisitions: | ||
(Increase) decrease in accounts receivables | -4,622 | 10,682 |
(Increase) decrease in inventory | -6,093 | 11,426 |
(Increase) decrease in prepaids and other assets | -86 | 604 |
Decrease (increase) in other assets | 392 | -1,744 |
(Decrease) increase in accounts payable and accrued expenses | -1,260 | -5,620 |
Net cash (used in) provided by operating activities | -6,276 | 19,061 |
Cash flows from investing activities: | ||
Acquisitions of property and equipment | -2,733 | -3,259 |
Acquisitions of other intangible assets | -227 | -1,114 |
Proceeds from sale of assets | 138 | |
Acquisitions, net of cash acquired | -87 | |
Net cash used in investing activities | -2,960 | -4,322 |
Cash flows from financing activities: | ||
Net borrowings (repayments) of debt | 9,021 | -15,819 |
Issuance of common stock upon exercise of stock options | 19 | 32 |
Net cash (used in) provided by financing activities | 9,040 | -15,787 |
Effect of exchange rate changes on cash and cash equivalents | -105 | -511 |
Net decrease in cash and cash equivalents | -301 | -1,559 |
Cash and cash equivalents at beginning of period | 1,573 | 3,132 |
Cash and cash equivalents at end of period | 1,272 | 1,573 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the year for interest | 3,310 | 3,428 |
Cash paid during the year for income taxes | $90 | $96 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Common Stock | Additional Paid in Capital | Treasury Stock | Retained Earnings | Accumulated Comprehensive Income (Loss) | Total |
In Thousands, except Share data, unless otherwise specified | ||||||
Balance at Dec. 31, 2012 | $2 | $72,790 | ($1,283) | ($41,352) | ($204) | $29,953 |
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 | -2,815 | -2,815 | ||||
Foreign currency translation adjustment | -573 | -573 | ||||
Balance at Dec. 31, 2013 | 2 | 73,715 | -1,283 | -44,167 | -777 | 27,490 |
Balance (in shares) at Dec. 31, 2013 | 17,986,275 | |||||
Increase (Decrease) in Shareholders' Equity | ||||||
Issuance of common stock upon vesting of restricted shares (in shares) | 152,010 | |||||
Issuance of common stock upon exercise of stock options | 19 | 19 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 6,000 | |||||
Stock-based compensation | 1,220 | 1,220 | ||||
Net loss | -245 | -245 | ||||
Foreign currency translation adjustment | -633 | -633 | ||||
Balance at Jan. 03, 2015 | $2 | $74,954 | ($1,283) | ($44,412) | ($1,410) | $27,851 |
Balance (in shares) at Jan. 03, 2015 | 18,144,285 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jan. 03, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Nature of Operations | |
The Company designs, markets and distributes branded juvenile health, safety and wellness products that are sold globally to large national retailers as well as independent retailers, primarily in North America. The Company currently markets its products in several product categories including monitoring, safety, nursery, baby gear, and feeding products. Most products are sold under our core brand names of Summer®, SwaddleMe®, and Born Free®. | |
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. | |
Change in Fiscal Year | |
In December 2014, the Board of Directors approved a change in the Company's fiscal year, from a fiscal year ending on December 31 of each calendar year to a fiscal year ending on the Saturday closest to December 31 of each calendar year. This change is effective with the current fiscal year such that the Company's fiscal year ended on January 3, 2015. | |
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 contractual terms and historical experience. | |
Sales incentives or other consideration given by the Company to customers that are considered adjustments of the selling price of 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. | |
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. | |
Cash and Cash Equivalents | |
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. Amounts are considered to be uncollectable based upon historical experience and management's evaluation of outstanding accounts receivable. | |
Inventory Valuation | |
Inventory is comprised mostly of finished goods and some component parts 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. | |
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 January 3, 2015 and December 31, 2013, no such impairment existed. | |
Indefinite-Lived Intangible Assets | |
The Company accounts for intangible assets in accordance with accounting guidance that requires that 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 determined that no impairment existed on its indefinite-lived intangible assets for the years ended January 3, 2015 and December 31, 2013. | |
Fair Value Measurements | |
The Company follows ASC 820, "Fair Value Measurements and Disclosures" which includes a framework for measuring fair value and expanded related disclosures. Broadly, the framework requires 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'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. | |
The Company follows the appropriate guidance relative to uncertain tax positions. This standard provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Uncertain tax positions must meet a recognition threshold of more-likely-than-not in order for those tax positions to be recognized in the financial statements. For years ended January 3, 2015 and December 31, 2013 the Company had no material uncertain tax positions or unrecognized tax benefits. | |
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 loss. Foreign exchange transaction gains and losses are included in the accompanying statements of operations and deemed immaterial. | |
Shipping Costs | |
Shipping costs to customers are included in selling expenses and amounted to approximately $1,889 and $1,521 for the years ended January 3, 2015 and December 31, 2013, 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 $15,245 and $16,791 for the years ended January 3, 2015 and December 31, 2013, respectively. | |
Net Loss Per Share | |
Basic earnings per share is calculated by dividing net loss for the period by the weighted average number of common stock outstanding during the period. | |
Diluted loss per share for the Company is computed by dividing net loss by the dilutive weighted average shares outstanding which includes: the dilutive impact (using the "treasury stock" method) of "in the money" stock options and unvested restricted shares issued to employees. Options to purchase 1,729,365 and 1,409,412 shares of the Company's common stock and 242,249 and 268,361 of restricted shares were not included in the calculation, due to the fact that these instruments were anti-dilutive for the years ended January 3, 2015 and December 31, 2013, respectively. | |
New Accounting Pronouncements | |
In May 2014, the FASB issued new accounting guidance related to revenue recognition. This new standard will replace all current U.S. GAAP guidance on this topic and eliminate all industry-specific guidance. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. This guidance will be effective beginning January 1, 2017 and can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the impact of the adoption of this guidance on 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 | ||||||||
Jan. 03, 2015 | |||||||||
PROPERTY AND EQUIPMENT | |||||||||
PROPERTY AND EQUIPMENT | 2. PROPERTY AND EQUIPMENT | ||||||||
Property and equipment, at cost, consisted of the following: | |||||||||
For the fiscal year ended | |||||||||
January 3, | December 31, | Depreciation/ | |||||||
2015 | 2013 | Amortization Period | |||||||
Computer-related | $ | 6,201 | $ | 5,672 | 5 years | ||||
Tools, dies prototypes, and molds | 28,667 | 26,372 | 1 - 5 years | ||||||
Building | 4,156 | 4,156 | 30 years | ||||||
Other | 5,437 | 5,584 | various | ||||||
| | | | | | | | | |
44,461 | 41,784 | ||||||||
Less: accumulated depreciation | 31,381 | 26,988 | |||||||
| | | | | | | | | |
Property and equipment, net | $ | 13,080 | $ | 14,796 | |||||
| | | | | | | | | |
| | | | | | | | | |
Property and equipment included amounts acquired under capital leases of approximately $1,387 and $3,010 at January 3, 2015 and December 31, 2013, respectively, with related accumulated depreciation of approximately $537 and $756, respectively. Total depreciation expense was $4,425 and $5,145 for the fiscal years ended January 3, 2015 and December 31, 2013, respectively. | |||||||||
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
INTANGIBLE ASSETS | ||||||||
INTANGIBLE ASSETS | 3. INTANGIBLE ASSETS | |||||||
Intangible assets | ||||||||
Intangible assets consisted of the following: | ||||||||
For the fiscal year ended | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
Brand names | $ | 14,812 | $ | 14,812 | ||||
Patents and licenses | 3,605 | 3,378 | ||||||
Customer relationships | 6,946 | 6,946 | ||||||
Other intangibles | 1,882 | 1,882 | ||||||
| | | | | | | | |
27,245 | 27,018 | |||||||
Less: accumulated amortization | -6,566 | -5,443 | ||||||
| | | | | | | | |
Intangible assets, net | $ | 20,679 | $ | 21,575 | ||||
| | | | | | | | |
| | | | | | | | |
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 assets have indefinite lives (brand names). Total of intangibles not subject to amortization amounted to $12,308 for the fiscal years ended January 3, 2015 and December 31, 2013, respectively. | ||||||||
Amortization expense amounted to $1,123 and $1,135 for the fiscal years ended January 3, 2015 and December 31, 2013, respectively. Estimated amortization expense for the next five years is as follows: | ||||||||
Fiscal Year ending | ||||||||
2015 | $ | 1,079 | ||||||
2016 | 1,079 | |||||||
2017 | 1,079 | |||||||
2018 | 1,058 | |||||||
2019 | 1,050 | |||||||
DEBT
DEBT | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
DEBT | |||||
DEBT | 4. DEBT | ||||
Credit Facilities | |||||
On February 28, 2013, the Company, along with its subsidiary, Summer Infant (USA), Inc., entered into a new loan and security agreement with Bank of America, N.A. to provide an $80,000, asset-based revolving credit facility (as subsequently amended on November 8, 2013, the "BofA Agreement"). The BofA Agreement replaced the Company's prior credit facility with Bank of America, which was set to expire in December 2013. In conjunction with its entry into the BofA Agreement, the Company also entered into a term loan agreement 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 the Company's eligible accounts receivable plus the lesser of (i) 70% of the value of eligible inventory or (ii) 85% of the net orderly liquidation value of eligible inventory, 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 of the Company's assets, subject to a first priority lien on certain assets held by the lender of the Term Loan as described below. In addition, Summer Infant Canada Limited and Summer Infant Europe Limited, the Company's subsidiaries, are guarantors under the BofA Agreement. Proceeds from the loans under the BofA Agreement were used to satisfy existing debt, pay fees and transaction expenses associated with the closing of the BofA Agreement, pay obligations under the prior 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 January 3, 2015, the base rate on loans was 4.0% and the LIBOR rate was 2.5%. | |||||
Under the BofA Agreement, the Company is required to comply with certain financial covenants. Prior to the execution of an amendment to the BofA Agreement on November 8, 2013, the Company was required, (i) for the first year of the loan, to maintain and earn a specified minimum, monthly consolidated EBITDA amount, as defined, in the BofA Agreement ("Bank EBITDA"), with such specified amounts increasing over the first twelve months of the loan to a minimum consolidated Bank EBITDA of $12,000 at February 28, 2014, and (ii) beginning with the fiscal quarter ending March 31, 2014, was to 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 Bank 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 to the BofA Agreement (the "BofA Amendment"). The BofA Amendment amended the financial covenants in the BofA Agreement to provide that (i) the Company was no longer required to comply with the prior minimum Bank EBITDA covenants for any period ending after September 30, 2013 and (ii) the Company must maintain a trailing twelve month fixed charge coverage ratio of at least 1.0 to 1.0, tested on a monthly basis, from and after September 30, 2013. On December 12, 2014, the BofA agreement was further amended to reflect the Company's change in fiscal year. | |||||
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 of a change of control. In the event of a default, all of the Company's obligations and the obligations of 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. | |||||
The amount outstanding on the BofA Agreement at January 3, 2015 was $45,777. Total borrowing capacity under the BofA Agreement at January 3, 2015 was $54,577 and borrowing availability was $8,800. | |||||
Term Loan | |||||
On February 28, 2013, the Company, along with its subsidiary, Summer Infant (USA), Inc., as borrowers, entered into a term-loan agreement (as subsequently amended on November 8, 2013, the "Term Loan Agreement") with Salus Capital Partners, LLC for a $15,000 term-loan (as subsequently amended, the "Term Loan"). | |||||
Proceeds from the Term Loan were used to repay certain existing debt, and 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 of the Company's assets, including a first priority lien on intellectual property, plant, property and equipment, and a pledge of 65% of the ownership interests in certain of the Company's subsidiaries. The Term Loan matures on February 28, 2018. In addition, Summer Infant Canada Limited and Summer Infant Europe Limited, the Company's subsidiaries, 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 January 3, 2015, 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 execution of an amendment to the Term Loan Agreement on November 8, 2013, the Company was required to comply with certain financial covenants, including that the Company (i) meet the same minimum, monthly consolidated Bank 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 was defined as the ratio of (1) all amounts outstanding under the Term Loan Agreement and the BofA Agreement to (2) consolidated Bank 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 Company's obligations and the obligations of 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 to the Term Loan Agreement (the "Term Loan Amendment"). 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 Bank EBITDA covenants for any period ending after September 30, 2013, (ii) the Company must maintain a trailing twelve 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 twelve 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. On December 31, 2014, the Term Loan agreement was further amended to reflect the Company's change in fiscal year. | |||||
The amount outstanding on the Term Loan at January 3, 2015 was $12,750. | |||||
Aggregate maturities of bank debt related to the BofA credit facility and Term Loan are as follows: | |||||
Fiscal Year ending: | |||||
2015 | $ | 1,500 | |||
2016 | $ | 1,500 | |||
2017 | $ | 1,500 | |||
2018 | $ | 54,027 | |||
| | | | | |
Total | $ | 58,527 | |||
| | | | | |
| | | | | |
Sale-Leaseback | |||||
On March 24, 2009, Summer Infant (USA), Inc., the Company's wholly owned subsidiary ("Summer USA"), 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, or 2016, unless an option period is exercised by Summer USA. At the end of the initial term, 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 January 3, 2015, approximately $312 was included in accounts payable and accrued expenses, with the balance of approximately $2,994 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 of Directors granted a potential waiver, to the extent necessary, if at all, of the conflict of interest provisions of the Company's 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 | |||||||
Jan. 03, 2015 | ||||||||
INCOME TAXES | ||||||||
INCOME TAXES | 5. INCOME TAXES | |||||||
The benefit for income taxes is summarized as follows: | ||||||||
Fiscal | Fiscal | |||||||
2014 | 2013 | |||||||
Current: | ||||||||
Federal | $ | 205 | $ | (15 | ) | |||
Foreign | 401 | (599 | ) | |||||
State and local | 20 | (3 | ) | |||||
| | | | | | | | |
Total current | 626 | (617 | ) | |||||
Deferred (primarily federal) | (1,153 | ) | (701 | ) | ||||
| | | | | | | | |
Total benefit | $ | (527 | ) | $ | (1,318 | ) | ||
| | | | | | | | |
| | | | | | | | |
The tax effects of temporary differences that comprise the deferred tax liabilities and assets are as follows: | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
Assets (Liabilities) | ||||||||
Deferred tax asset—current: | ||||||||
Accounts receivable | $ | 21 | $ | 13 | ||||
Inventory and Unicap reserve | 1,035 | 694 | ||||||
Foreign tax credit carry-forward and other | 138 | 125 | ||||||
| | | | | | | | |
Net deferred tax asset—current | 1,194 | 832 | ||||||
| | | | | | | | |
Deferred tax (liability) asset—non-current: | ||||||||
Research and development credit, foreign tax credit and net operating loss carry-forward | 4,193 | 3,953 | ||||||
Intangible assets and other | (3,850 | ) | (4,008 | ) | ||||
Property, plant and equipment | (1,143 | ) | (1,776 | ) | ||||
| | | | | | | | |
Total deferred tax liability | (800 | ) | (1,831 | ) | ||||
Valuation allowance | (1,578 | ) | (1,309 | ) | ||||
| | | | | | | | |
Net deferred tax liability non-current: | (2,378 | ) | (3,140 | ) | ||||
| | | | | | | | |
Net deferred income tax liability | $ | (1,184 | ) | $ | (2,308 | ) | ||
| | | | | | | | |
| | | | | | | | |
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: | ||||||||
Fiscal | Fiscal | |||||||
2014 | 2013 | |||||||
Tax benefit at statutory rate | $ | (262 | ) | $ | (1,405 | ) | ||
State income taxes, net of U.S. federal income tax benefit | (76 | ) | 232 | |||||
Stock options | 213 | 121 | ||||||
Valuation allowance of state R&D credits | (23 | ) | 110 | |||||
Foreign tax rate differential | (249 | ) | (184 | ) | ||||
Tax credits | (173 | ) | (150 | ) | ||||
Non-deductible expenses | 25 | 16 | ||||||
Other | 18 | (58 | ) | |||||
| | | | | | | | |
Total benefit | $ | (527 | ) | $ | (1,318 | ) | ||
| | | | | | | | |
| | | | | | | | |
The Company had undistributed earnings from certain foreign subsidiaries (Summer Infant Asia, Summer Infant Australia, and Born Free Holdings, Ltd) of approximately $13,796 at January 3, 2015, and all of these earnings are 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 4—Debt. The cumulative effect in 2014 was $29 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 January 3, 2015, the Company has approximately $246 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 $1,386 and $251 of NOLs in Canada and Australia 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 $1,578 relating to certain state tax credits is necessary at January 3, 2015. | ||||||||
Upon the adoption, and at January 3, 2015 and December 31, 2013, the Company did not have any material uncertain tax positions. No interest and penalties related to uncertain tax positions were accrued at January 3, 2015 and December 31, 2013. 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 | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
SHARE BASED COMPENSATION | ||||||||||||||||||||
SHARE BASED COMPENSATION | 6. SHARE BASED COMPENSATION | |||||||||||||||||||
The Company is authorized to issue up to 3,000,000 shares for equity awards under the Company's 2006 Performance Equity Plan ("2006 Plan") and 1,100,000 shares for equity awards under the Company's 2012 Incentive Compensation Plan (as amended, "2012 Plan"). The Company's stockholders approved an increase in the number of shares available under the 2012 Plan from 500,000 to 1,100,000 shares on August 13, 2014. Periodically, the company also provides equity awards outside of the plans. | ||||||||||||||||||||
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 twelve months ended January 3, 2015 and December 31, 2013 of $1,220 and $893, respectively. Share based compensation expense is included in selling, general and administrative expenses. | ||||||||||||||||||||
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 table below. 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 Securities and Exchange Commission. 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 fiscal 2014 and 2013 is based on awards that are ultimately expected to vest. | ||||||||||||||||||||
The following table summarizes the weighted average assumptions used for options granted during the fiscal years ended January 3, 2015 and December 31, 2013. | ||||||||||||||||||||
Fiscal | Fiscal | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Expected life (in years) | 4.9 | 6.0 | ||||||||||||||||||
Risk-free interest rate | 1.7 | % | 1.7 | % | ||||||||||||||||
Volatility | 63.0 | % | 55.0 | % | ||||||||||||||||
Dividend yield | 0.0 | % | 0.0 | % | ||||||||||||||||
Forfeiture rate | 13.1 | % | 10.0 | % | ||||||||||||||||
The weighted-average grant date fair value of options granted during the year ended January 3, 2015 was $1.21 per share which totaled $803 for the 664,000 options granted during such period. During the year ended December 31, 2013, the weighted-average grant date fair value of options granted was $1.69 per share which totaled $588 for the 348,000 options granted during the year. | ||||||||||||||||||||
A summary of the status of the Company's options as of January 3, 2015 and changes during the year then ended is presented below: | ||||||||||||||||||||
Number Of | Weighted-Average | |||||||||||||||||||
Shares | Exercise Price | |||||||||||||||||||
Outstanding at beginning of year | 1,409,812 | $ | 3.92 | |||||||||||||||||
Granted | 664,000 | $ | 2.24 | |||||||||||||||||
Exercised | (6,000 | ) | $ | 3.16 | ||||||||||||||||
Canceled | (338,447 | ) | $ | 3.81 | ||||||||||||||||
| | | | | | | | |||||||||||||
Outstanding at end of year | 1,729,365 | $ | 3.3 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Options exercisable at January 3, 2015 | 1,264,918 | $ | 3.43 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Outstanding stock options expected to vest as of January 3, 2015 is 1,654,449. The intrinsic value of options exercised totaled $6 and $3 for the fiscal years ended January 3, 2015 and December 31, 2013, respectively. | ||||||||||||||||||||
The following table summarizes information about stock options at January 3, 2015: | ||||||||||||||||||||
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 - $2.00 | 194,750 | 9.2 | $ | 1.86 | 29,750 | 9.0 | $ | 1.85 | ||||||||||||
$2.01 - $3.00 | 777,000 | 4.9 | $ | 2.20 | 730,656 | 4.7 | $ | 2.19 | ||||||||||||
$3.01 - $4.00 | 265,063 | 7.2 | $ | 3.34 | 59,315 | 6.6 | $ | 3.38 | ||||||||||||
$4.01 - $5.00 | 2,000 | 9.6 | $ | 4.06 | 0 | NA | NA | |||||||||||||
$5.01 - $6.00 | 407,002 | 3.3 | $ | 5.33 | 364,947 | 3.2 | $ | 5.30 | ||||||||||||
$6.01 - $8.00 | 83,550 | 6.3 | $ | 6.94 | 80,250 | 6.3 | $ | 6.90 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
1,729,365 | 5.4 | $ | 3.30 | 1,264,918 | 4.6 | $ | 3.43 | |||||||||||||
The aggregate intrinsic value of options outstanding and exercisable at January 3, 2015 and December 31, 2013 are $886 and $3, respectively. | ||||||||||||||||||||
Number of | Weighted | Weighted | ||||||||||||||||||
Options | Average | Average | ||||||||||||||||||
Exercise | Grant Date | |||||||||||||||||||
Price | Fair Value | |||||||||||||||||||
Non-vested options at December 31, 2013 | 467,668 | $ | 4.04 | $ | 2.13 | |||||||||||||||
Options granted | 664,000 | 2.24 | 1.21 | |||||||||||||||||
Options vested | (221,239 | ) | 3.21 | 1.72 | ||||||||||||||||
Options forfeited | (445,982 | ) | 2.93 | 1.55 | ||||||||||||||||
| | | | | | | | | | | ||||||||||
Non-vested options at January 3, 2015 | 464,447 | $ | 2.93 | $ | 1.57 | |||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
As of January 3, 2015, there was approximately $471 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 2.5 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 made in the year ended January 3, 2015, is as follows: | ||||||||||||||||||||
Number of | Grant Date | |||||||||||||||||||
Shares | Fair Value | |||||||||||||||||||
Non-Vested restricted stock awards as of December 31, 2013 | 268,361 | $ | 4.09 | |||||||||||||||||
Granted | 237,064 | 2.66 | ||||||||||||||||||
Vested | (152,010 | ) | 3.9 | |||||||||||||||||
Forfeited | (111,166 | ) | 3.18 | |||||||||||||||||
| | | | | | | | |||||||||||||
Non-Vested restricted stock awards as of January 3, 2015 | 242,249 | $ | 3.22 | |||||||||||||||||
| | | | | | | | |||||||||||||
As of January 3, 2015, there was approximately $455 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 2.4 years. | ||||||||||||||||||||
As of January 3, 2015, there are 230,744 shares available to grant under the 2006 Plan and 636,375 shares available to grant under the 2012 Plan. | ||||||||||||||||||||
CAPITAL_LEASE_OBLIGATIONS
CAPITAL LEASE OBLIGATIONS | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
CAPITAL LEASE OBLIGATIONS | ||||||||||||||||||||
CAPITAL LEASE OBLIGATIONS | 7. 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 $211 and $678 is included in debt on the consolidated balance sheets as of January 3, 2015 and December 31, 2013, respectively, of which approximately $70 and $228 is included in long-term liabilities as of January 3, 2015 and December 31, 2013, respectively, and the balance is in current portion of long-term debt. The minimum future lease payments, including principal and interest, are approximately $219 and $715, respectively. | ||||||||||||||||||||
Future Minimum Lease Payments | ||||||||||||||||||||
Total | 2015 | 2016 | 2017 | 2018 | 2019 & | |||||||||||||||
Beyond | ||||||||||||||||||||
Capital Lease Payments | $ | 219 | $ | 147 | $ | 72 | $ | — | $ | — | $ | — | ||||||||
Interest | (7 | ) | (6 | ) | (1 | ) | (— | ) | (— | ) | — | |||||||||
| | | | | | | | | | | | | | | | | | | | |
Principal | $ | 212 | $ | 141 | $ | 71 | $ | — | $ | — | $ | — | ||||||||
PROFIT_SHARING_PLAN
PROFIT SHARING PLAN | 12 Months Ended |
Jan. 03, 2015 | |
PROFIT SHARING PLAN | |
PROFIT SHARING PLAN | |
8. PROFIT SHARING PLAN | |
Summer Infant (USA), Inc. maintains a defined contribution salary deferral 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 eligible compensation. In 2007, the Company adopted a matching plan which was funded throughout the year. For the years ended January 3, 2015 and December 31, 2013, the Company recorded 401(k) matching expense of $216 and $226, respectively. | |
MAJOR_CUSTOMERS
MAJOR CUSTOMERS | 12 Months Ended |
Jan. 03, 2015 | |
MAJOR CUSTOMERS | |
MAJOR CUSTOMERS | 9. MAJOR CUSTOMERS |
Sales to the Company's top seven customers together comprised more than 74% of the Company's sales in fiscal 2014 and 78% in 2013. These customers include Babies R Us/Toys R Us, Wal-Mart, Target, Amazon.com, Buy Buy Baby, K-Mart, and Burlington Coat Factory. Of these customers, four generated more than 10% of sales for fiscal 2014: Babies R Us/Toys R Us (27%), Walmart (14%), Target (11%), and Amazon.com (11%). In fiscal 2013, three customers generated more than 10% of sales: Babies R Us/Toys R Us (31%), Walmart (19%) and Target (11%). | |
Because of the concentration of the Company's business with these customers and because it has no long term contracts with these customers, the Company's success depends on its customers' willingness to purchase and provide shelf space for its products. | |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
COMMITMENTS AND CONTINGENCIES | |||||
COMMITMENTS AND CONTINGENCIES | |||||
10. 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 January 3, 2015 and December 31, 2013 were approximately $915 and $1,847, 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 $27 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): | |||||
Fiscal Year Ending: | |||||
2015 | $ | 1,936 | |||
2016 | 1,363 | ||||
2017 | 339 | ||||
2018 | 161 | ||||
2019 | — | ||||
| | | | | |
Total | $ | 3,799 | |||
| | | | | |
| | | | | |
(a) | Amounts exclude payments for sales-leaseback transaction as described in Note 4. | ||||
Rent expense (excluding taxes, fees and other charges) for the years ended January 3, 2015 and December 31, 2013 totaled approximately $1,902 and $1,915, respectively. | |||||
Employment Contracts | |||||
In accordance with United Kingdom and EU law, Summer Infant Europe Limited has employment contracts with all of its 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 | |||||
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 | |||||||
Jan. 03, 2015 | ||||||||
GEOGRAPHICAL INFORMATION | ||||||||
GEOGRAPHICAL INFORMATION | 11. 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: | ||||||||
For the fiscal year ended | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
United States | $ | 170,375 | $ | 174,253 | ||||
All Other | 34,984 | 33,920 | ||||||
| | | | | | | | |
$ | 205,359 | $ | 208,173 | |||||
| | | | | | | | |
| | | | | | | | |
The following is a table that presents total assets by geographic area: | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
United States | $ | 100,302 | $ | 94,033 | ||||
All Other | 22,165 | 21,334 | ||||||
| | | | | | | | |
$ | 122,467 | $ | 115,367 | |||||
| | | | | | | | |
| | | | | | | | |
The following is a table that presents total long lived assets by geographic area: | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
United States | $ | 27,180 | $ | 30,858 | ||||
All Other | 7,944 | 7,262 | ||||||
| | | | | | | | |
$ | 35,124 | $ | 38,120 | |||||
| | | | | | | | |
| | | | | | | | |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jan. 03, 2015 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | |
12. SUBSEQUENT EVENTS | |
The Company has evaluated all events or transactions that occurred after January 3, 2015 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 |
Jan. 03, 2015 | |
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 contractual terms and historical experience. | |
Sales incentives or other consideration given by the Company to customers that are considered adjustments of the selling price of 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. | |
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. | |
Cash and Cash Equivalents | Cash and Cash Equivalents |
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. Amounts are considered to be uncollectable based upon historical experience and management's evaluation of outstanding accounts receivable. | |
Inventory Valuation | Inventory Valuation |
Inventory is comprised mostly of finished goods and some component parts 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. | |
. | |
Long-Lived Assets with Finite Lives | 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 January 3, 2015 and December 31, 2013, no such impairment existed. | |
Indefinite-Lived Intangible Assets | Indefinite-Lived Intangible Assets |
The Company accounts for intangible assets in accordance with accounting guidance that requires that 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 determined that no impairment existed on its indefinite-lived intangible assets for the years ended January 3, 2015 and December 31, 2013. | |
Fair Value Measurements | Fair Value Measurements |
The Company follows ASC 820, "Fair Value Measurements and Disclosures" which includes a framework for measuring fair value and expanded related disclosures. Broadly, the framework requires 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'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. | |
The Company follows the appropriate guidance relative to uncertain tax positions. This standard provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements. Uncertain tax positions must meet a recognition threshold of more-likely-than-not in order for those tax positions to be recognized in the financial statements. For years ended January 3, 2015 and December 31, 2013 the Company had no material uncertain tax positions or unrecognized tax benefits. | |
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 loss. Foreign exchange transaction gains and losses are included in the accompanying statements of operations and deemed immaterial. | |
Shipping Costs | Shipping Costs |
Shipping costs to customers are included in selling expenses and amounted to approximately $1,889 and $1,521 for the years ended January 3, 2015 and December 31, 2013, 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 $15,245 and $16,791 for the years ended January 3, 2015 and December 31, 2013, respectively. | |
Net Loss Per Share | Net Loss Per Share |
Basic earnings per share is calculated by dividing net loss for the period by the weighted average number of common stock outstanding during the period. | |
Diluted loss per share for the Company is computed by dividing net loss by the dilutive weighted average shares outstanding which includes: the dilutive impact (using the "treasury stock" method) of "in the money" stock options and unvested restricted shares issued to employees. Options to purchase 1,729,365 and 1,409,412 shares of the Company's common stock and 242,249 and 268,361 of restricted shares were not included in the calculation, due to the fact that these instruments were anti-dilutive for the years ended January 3, 2015 and December 31, 2013, respectively. | |
New Accounting Pronouncements | New Accounting Pronouncements |
In May 2014, the FASB issued new accounting guidance related to revenue recognition. This new standard will replace all current U.S. GAAP guidance on this topic and eliminate all industry-specific guidance. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. This guidance will be effective beginning January 1, 2017 and can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the impact of the adoption of this guidance on 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 | ||||||||
Jan. 03, 2015 | |||||||||
PROPERTY AND EQUIPMENT | |||||||||
Schedule of property and equipment, at cost | |||||||||
For the fiscal year ended | |||||||||
January 3, | December 31, | Depreciation/ | |||||||
2015 | 2013 | Amortization Period | |||||||
Computer-related | $ | 6,201 | $ | 5,672 | 5 years | ||||
Tools, dies prototypes, and molds | 28,667 | 26,372 | 1 - 5 years | ||||||
Building | 4,156 | 4,156 | 30 years | ||||||
Other | 5,437 | 5,584 | various | ||||||
| | | | | | | | | |
44,461 | 41,784 | ||||||||
Less: accumulated depreciation | 31,381 | 26,988 | |||||||
| | | | | | | | | |
Property and equipment, net | $ | 13,080 | $ | 14,796 | |||||
| | | | | | | | | |
| | | | | | | | | |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
INTANGIBLE ASSETS | ||||||||
Schedule of intangible assets | ||||||||
For the fiscal year ended | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
Brand names | $ | 14,812 | $ | 14,812 | ||||
Patents and licenses | 3,605 | 3,378 | ||||||
Customer relationships | 6,946 | 6,946 | ||||||
Other intangibles | 1,882 | 1,882 | ||||||
| | | | | | | | |
27,245 | 27,018 | |||||||
Less: accumulated amortization | (6,566 | ) | (5,443 | ) | ||||
| | | | | | | | |
Intangible assets, net | $ | 20,679 | $ | 21,575 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of estimated amortization expense for the next five years | ||||||||
Fiscal Year ending | ||||||||
2015 | $ | 1,079 | ||||||
2016 | 1,079 | |||||||
2017 | 1,079 | |||||||
2018 | 1,058 | |||||||
2019 | 1,050 | |||||||
DEBT_Tables
DEBT (Tables) | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
DEBT | |||||
Schedule of aggregate maturities of bank debt | |||||
Fiscal Year ending: | |||||
2015 | $ | 1,500 | |||
2016 | $ | 1,500 | |||
2017 | $ | 1,500 | |||
2018 | $ | 54,027 | |||
| | | | | |
Total | $ | 58,527 | |||
| | | | | |
| | | | | |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
INCOME TAXES | ||||||||
Schedule of benefit for income taxes | ||||||||
Fiscal | Fiscal | |||||||
2014 | 2013 | |||||||
Current: | ||||||||
Federal | $ | 205 | $ | (15 | ) | |||
Foreign | 401 | (599 | ) | |||||
State and local | 20 | (3 | ) | |||||
| | | | | | | | |
Total current | 626 | (617 | ) | |||||
Deferred (primarily federal) | (1,153 | ) | (701 | ) | ||||
| | | | | | | | |
Total benefit | $ | (527 | ) | $ | (1,318 | ) | ||
| | | | | | | | |
| | | | | | | | |
Schedule of tax effects of temporary differences that comprise the deferred tax liabilities and assets | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
Assets (Liabilities) | ||||||||
Deferred tax asset—current: | ||||||||
Accounts receivable | $ | 21 | $ | 13 | ||||
Inventory and Unicap reserve | 1,035 | 694 | ||||||
Foreign tax credit carry-forward and other | 138 | 125 | ||||||
| | | | | | | | |
Net deferred tax asset—current | 1,194 | 832 | ||||||
| | | | | | | | |
Deferred tax (liability) asset—non-current: | ||||||||
Research and development credit, foreign tax credit and net operating loss carry-forward | 4,193 | 3,953 | ||||||
Intangible assets and other | (3,850 | ) | (4,008 | ) | ||||
Property, plant and equipment | (1,143 | ) | (1,776 | ) | ||||
| | | | | | | | |
Total deferred tax liability | (800 | ) | (1,831 | ) | ||||
Valuation allowance | (1,578 | ) | (1,309 | ) | ||||
| | | | | | | | |
Net deferred tax liability non-current: | (2,378 | ) | (3,140 | ) | ||||
| | | | | | | | |
Net deferred income tax liability | $ | (1,184 | ) | $ | (2,308 | ) | ||
| | | | | | | | |
| | | | | | | | |
Schedule of reconciliation of the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit | ||||||||
Fiscal | Fiscal | |||||||
2014 | 2013 | |||||||
Tax benefit at statutory rate | $ | (262 | ) | $ | (1,405 | ) | ||
State income taxes, net of U.S. federal income tax benefit | (76 | ) | 232 | |||||
Stock options | 213 | 121 | ||||||
Valuation allowance of state R&D credits | (23 | ) | 110 | |||||
Foreign tax rate differential | (249 | ) | (184 | ) | ||||
Tax credits | (173 | ) | (150 | ) | ||||
Non-deductible expenses | 25 | 16 | ||||||
Other | 18 | (58 | ) | |||||
| | | | | | | | |
Total benefit | $ | (527 | ) | $ | (1,318 | ) | ||
| | | | | | | | |
| | | | | | | | |
SHARE_BASED_COMPENSATION_Table
SHARE BASED COMPENSATION (Tables) | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Stock options and restricted shares | ||||||||||||||||||||
Schedule of weighted average assumptions used for stock options granted | ||||||||||||||||||||
The following table summarizes the weighted average assumptions used for options granted during the fiscal years ended January 3, 2015 and December 31, 2013. | ||||||||||||||||||||
Fiscal | Fiscal | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Expected life (in years) | 4.9 | 6.0 | ||||||||||||||||||
Risk-free interest rate | 1.7 | % | 1.7 | % | ||||||||||||||||
Volatility | 63.0 | % | 55.0 | % | ||||||||||||||||
Dividend yield | 0.0 | % | 0.0 | % | ||||||||||||||||
Forfeiture rate | 13.1 | % | 10.0 | % | ||||||||||||||||
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 | 1,409,812 | $ | 3.92 | |||||||||||||||||
Granted | 664,000 | $ | 2.24 | |||||||||||||||||
Exercised | (6,000 | ) | $ | 3.16 | ||||||||||||||||
Canceled | (338,447 | ) | $ | 3.81 | ||||||||||||||||
| | | | | | | | |||||||||||||
Outstanding at end of year | 1,729,365 | $ | 3.3 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Options exercisable at January 3, 2015 | 1,264,918 | $ | 3.43 | |||||||||||||||||
| | | | | | | | |||||||||||||
| | | | | | | | |||||||||||||
Summary of stock options | ||||||||||||||||||||
The following table summarizes information about stock options at January 3, 2015: | ||||||||||||||||||||
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 - $2.00 | 194,750 | 9.2 | $ | 1.86 | 29,750 | 9.0 | $ | 1.85 | ||||||||||||
$2.01 - $3.00 | 777,000 | 4.9 | $ | 2.20 | 730,656 | 4.7 | $ | 2.19 | ||||||||||||
$3.01 - $4.00 | 265,063 | 7.2 | $ | 3.34 | 59,315 | 6.6 | $ | 3.38 | ||||||||||||
$4.01 - $5.00 | 2,000 | 9.6 | $ | 4.06 | 0 | NA | NA | |||||||||||||
$5.01 - $6.00 | 407,002 | 3.3 | $ | 5.33 | 364,947 | 3.2 | $ | 5.30 | ||||||||||||
$6.01 - $8.00 | 83,550 | 6.3 | $ | 6.94 | 80,250 | 6.3 | $ | 6.90 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
1,729,365 | 5.4 | $ | 3.30 | 1,264,918 | 4.6 | $ | 3.43 | |||||||||||||
Stock option | ||||||||||||||||||||
Stock options and restricted shares | ||||||||||||||||||||
Schedule of non-vested activity | ||||||||||||||||||||
Number of | Weighted | Weighted | ||||||||||||||||||
Options | Average | Average | ||||||||||||||||||
Exercise | Grant Date | |||||||||||||||||||
Price | Fair Value | |||||||||||||||||||
Non-vested options at December 31, 2013 | 467,668 | $ | 4.04 | $ | 2.13 | |||||||||||||||
Options granted | 664,000 | 2.24 | 1.21 | |||||||||||||||||
Options vested | (221,239 | ) | 3.21 | 1.72 | ||||||||||||||||
Options forfeited | (445,982 | ) | 2.93 | 1.55 | ||||||||||||||||
| | | | | | | | | | | ||||||||||
Non-vested options at January 3, 2015 | 464,447 | $ | 2.93 | $ | 1.57 | |||||||||||||||
| | | | | | | | | | | ||||||||||
| | | | | | | | | | | ||||||||||
Restricted shares | ||||||||||||||||||||
Stock options and restricted shares | ||||||||||||||||||||
Schedule of non-vested activity | ||||||||||||||||||||
Number of | Grant Date | |||||||||||||||||||
Shares | Fair Value | |||||||||||||||||||
Non-Vested restricted stock awards as of December 31, 2013 | 268,361 | $ | 4.09 | |||||||||||||||||
Granted | 237,064 | 2.66 | ||||||||||||||||||
Vested | (152,010 | ) | 3.9 | |||||||||||||||||
Forfeited | (111,166 | ) | 3.18 | |||||||||||||||||
| | | | | | | | |||||||||||||
Non-Vested restricted stock awards as of January 3, 2015 | 242,249 | $ | 3.22 | |||||||||||||||||
| | | | | | | | |||||||||||||
CAPITAL_LEASE_OBLIGATIONS_Tabl
CAPITAL LEASE OBLIGATIONS (Tables) | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
CAPITAL LEASE OBLIGATIONS | ||||||||||||||||||||
Schedule of future minimum lease payments | . | |||||||||||||||||||
Future Minimum Lease Payments | ||||||||||||||||||||
Total | 2015 | 2016 | 2017 | 2018 | 2019 & | |||||||||||||||
Beyond | ||||||||||||||||||||
Capital Lease Payments | $ | 219 | $ | 147 | $ | 72 | $ | — | $ | — | $ | — | ||||||||
Interest | (7 | ) | (6 | ) | (1 | ) | (— | ) | (— | ) | — | |||||||||
| | | | | | | | | | | | | | | | | | | | |
Principal | $ | 212 | $ | 141 | $ | 71 | $ | — | $ | — | $ | — | ||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
COMMITMENTS AND CONTINGENCIES | |||||
Schedule of future minimum rental payments due under leases | |||||
Approximate future minimum rental payments due under these leases are as follows (a): | |||||
Fiscal Year Ending: | |||||
2015 | $ | 1,936 | |||
2016 | 1,363 | ||||
2017 | 339 | ||||
2018 | 161 | ||||
2019 | — | ||||
| | | | | |
Total | $ | 3,799 | |||
| | | | | |
| | | | | |
(a) | Amounts exclude payments for sales-leaseback transaction as described in Note 4. | ||||
GEOGRAPHICAL_INFORMATION_Table
GEOGRAPHICAL INFORMATION (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
GEOGRAPHICAL INFORMATION | ||||||||
Schedule of net revenue by geographic area | ||||||||
For the fiscal year ended | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
United States | $ | 170,375 | $ | 174,253 | ||||
All Other | 34,984 | 33,920 | ||||||
| | | | | | | | |
$ | 205,359 | $ | 208,173 | |||||
| | | | | | | | |
| | | | | | | | |
Schedule of total assets by geographic area | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
United States | $ | 100,302 | $ | 94,033 | ||||
All Other | 22,165 | 21,334 | ||||||
| | | | | | | | |
$ | 122,467 | $ | 115,367 | |||||
| | | | | | | | |
| | | | | | | | |
Schedule of total long lived assets by geographic area | ||||||||
January 3, | December 31, | |||||||
2015 | 2013 | |||||||
United States | $ | 27,180 | $ | 30,858 | ||||
All Other | 7,944 | 7,262 | ||||||
| | | | | | | | |
$ | 35,124 | $ | 38,120 | |||||
| | | | | | | | |
| | | | | | | | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
Impairment of Long-Lived Assets with Finite Lives | ||
Impairment of Long-Lived Assets with Finite Lives | $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 | 1,889 | 1,521 |
Advertising Costs | ||
Advertising costs | $15,245 | $16,791 |
Stock option | ||
Net Income Per Share | ||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 1,729,365 | 1,409,412 |
Restricted shares | ||
Net Income Per Share | ||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 242,249 | 268,361 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
Property and equipment | ||
Property and equipment, gross | $44,461 | $41,784 |
Less accumulated depreciation | 31,381 | 26,988 |
Property and equipment, net | 13,080 | 14,796 |
Total depreciation expense | 4,425 | 5,145 |
Computer-related | ||
Property and equipment | ||
Property and equipment, gross | 6,201 | 5,672 |
Depreciation/Amortization Period | P5Y | |
Tools dies prototypes and molds | ||
Property and equipment | ||
Property and equipment, gross | 28,667 | 26,372 |
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 | 5,437 | 5,584 |
Property and equipment acquired under capital leases | ||
Property and equipment | ||
Less accumulated depreciation | 537 | 756 |
Property and equipment, net | $1,387 | $3,010 |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
Intangible assets | ||
Intangible assets, gross | $27,245 | $27,018 |
Less: accumulated amortization | -6,566 | -5,443 |
Intangible assets, net | 20,679 | 21,575 |
Intangibles not subject to amortization | 12,308 | 12,308 |
Amortization expense | 1,123 | 1,135 |
Estimated amortization expense | ||
2015 | 1,079 | |
2016 | 1,079 | |
2017 | 1,079 | |
2018 | 1,058 | |
2019 | 1,050 | |
Minimum | ||
Intangible assets | ||
Amortization period of intangible assets | 5 years | |
Maximum | ||
Intangible assets | ||
Amortization period of intangible assets | 20 years | |
Patents and licenses | ||
Intangible assets | ||
Intangible assets, gross | 3,605 | 3,378 |
Customer relationship | ||
Intangible assets | ||
Intangible assets, gross | 6,946 | 6,946 |
Other intangibles | ||
Intangible assets | ||
Intangible assets, gross | 1,882 | 1,882 |
Brand names | ||
Intangible assets | ||
Intangible assets, gross | $14,812 | $14,812 |
DEBT_Details
DEBT (Details) (USD $) | 0 Months Ended | 3 Months Ended | 0 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Feb. 28, 2013 | Sep. 30, 2013 | Nov. 08, 2013 | Jan. 03, 2015 |
item | ||||
Debt | ||||
Amount outstanding | 58,527 | |||
Aggregate maturities of bank debt | ||||
2015 | 1,500 | |||
2016 | 1,500 | |||
2017 | 1,500 | |||
2018 | 54,027 | |||
Total | 58,527 | |||
Term Loan | ||||
Debt | ||||
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 | |||
Interest rate at period end | 11.25% | |||
Senior leverage ratio | 1 | |||
Trailing period for testing senior leverage ratio | 12 months | |||
Period used in calculating the consolidated EBITDA under covenants | 12 months | |||
Amount outstanding | 12,750 | |||
Aggregate maturities of bank debt | ||||
Total | 12,750 | |||
Term Loan | LIBOR | ||||
Debt | ||||
Variable interest rate base | LIBOR | |||
Applicable margin (as a percent) | 10.00% | |||
Variable interest rate floor | 1.25% | |||
Term Loan | Minimum | ||||
Debt | ||||
Default event that may require Term Loan repayment if occurred, product recall value | 2,000 | |||
Amended term loan | ||||
Debt | ||||
Trailing period for EBITDA | 12 months | |||
Trailing period for testing senior leverage ratio | 12 months | |||
Amended term loan | Minimum | ||||
Debt | ||||
Fixed charge coverage ratio | 1 | |||
Amended term loan | Maximum | Leverage ratio for the period ending on or before June 30, 2014 | ||||
Debt | ||||
Senior leverage ratio | 6 | |||
Amended term loan | Maximum | Leverage ratio for periods ending July 1, 2014 through September 30, 2014 | ||||
Debt | ||||
Senior leverage ratio | 5.5 | |||
Amended term loan | Maximum | Leverage ratio for periods following September 30, 2014 | ||||
Debt | ||||
Senior leverage ratio | 5 | |||
BofA Agreement | ||||
Debt | ||||
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% | |||
Unused line fee based on the unused amount of the credit facilities (as a percent) | 0.38% | |||
BofA Agreement | LIBOR | ||||
Debt | ||||
Variable interest rate base | LIBOR | |||
Variable rate basis at the end of the period | 2.50% | |||
BofA Agreement | Base rate | ||||
Debt | ||||
Variable interest rate base | base rate | |||
Variable rate basis at the end of the period | 4.00% | |||
BofA Agreement | Minimum | LIBOR | ||||
Debt | ||||
Applicable margin (as a percent) | 1.75% | |||
BofA Agreement | Minimum | Base rate | ||||
Debt | ||||
Applicable margin (as a percent) | 0.25% | 0.25% | ||
BofA Agreement | Maximum | LIBOR | ||||
Debt | ||||
Applicable margin (as a percent) | 2.25% | |||
BofA Agreement | Maximum | Base rate | ||||
Debt | ||||
Applicable margin (as a percent) | 0.75% | |||
BofA Agreement | At February 28, 2014 | ||||
Debt | ||||
EBITDA to be maintained and earned | 12,000 | |||
BofA Agreement | Beginning with the fiscal quarter ending March 31, 2014 | ||||
Debt | ||||
Fixed charge coverage ratio | 1 | |||
Period of fixed charge coverage ratio | 1 year | |||
Asset-based revolving credit facility | ||||
Debt | ||||
Maximum amount of credit available | 80,000 | |||
Letter of credit sub-line facility | ||||
Debt | ||||
Maximum amount of credit available | 10,000 | |||
Amended BofA agreement | ||||
Debt | ||||
Amount outstanding on credit facility | 45,777 | |||
Current amount of credit available | 54,577 | |||
Available borrowing capacity | 8,800 | |||
Amended BofA agreement | Amended term loan | ||||
Debt | ||||
Trailing period for EBITDA | 12 months | |||
Amended BofA agreement | Amended term loan | Minimum | ||||
Debt | ||||
Fixed charge coverage ratio | 1 |
DEBT_Details_2
DEBT (Details 2) (USD $) | 0 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 24, 2009 | Jan. 03, 2015 |
item | ||
Accounts payable and accrued expenses | ||
Sale-Leaseback | ||
Financing lease obligation | $312 | |
Other liabilities | ||
Sale-Leaseback | ||
Financing lease obligation | 2,994 | |
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 | Jan. 03, 2015 | Dec. 31, 2013 |
Current: | ||
Federal | $205 | ($15) |
Foreign | 401 | -599 |
State and local | 20 | -3 |
Total current | 626 | -617 |
Deferred (primarily federal) | -1,153 | -701 |
Total benefit | -527 | -1,318 |
Deferred tax asset-current: | ||
Accounts receivable | 21 | 13 |
Inventory and Unicap reserve | 1,035 | 694 |
Foreign tax credit carry-forward and other | 138 | 125 |
Net deferred tax asset-current | 1,194 | 832 |
Deferred tax (liability) asset-non-current: | ||
Research and development credit, foreign tax credit and net operating loss carry-forward | 4,193 | 3,953 |
Intangible assets and other | -3,850 | -4,008 |
Property, plant and equipment | -1,143 | -1,776 |
Total deferred tax liability | -800 | -1,831 |
Valuation allowance | -1,578 | -1,309 |
Net deferred tax liability non-current: | -2,378 | -3,140 |
Net deferred income tax liability | -1,184 | -2,308 |
Reconciliation of the benefit for income taxes at the U.S. federal income tax statutory rate to the benefit | ||
Tax benefit at statutory rate | -262 | -1,405 |
State income taxes, net of U.S. federal income tax benefit | -76 | 232 |
Stock options | 213 | 121 |
Valuation allowance of state R&D credits | -23 | 110 |
Foreign tax rate differential | -249 | -184 |
Tax credits | -173 | -150 |
Non-deductible expenses | 25 | 16 |
Other | 18 | -58 |
Total benefit | -527 | -1,318 |
Undistributed earnings from foreign subsidiary | 13,796 | |
Cumulative effect of undistributed earnings from foreign subsidiary | 29 | |
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 | 246 | |
Canada | ||
Net operating loss carryforwards | ||
Net operating loss carryforwards, amount | 1,386 | |
United Kingdom | ||
Net operating loss carryforwards | ||
Net operating loss carryforwards, amount | $251 |
SHARE_BASED_COMPENSATION_Detai
SHARE BASED COMPENSATION (Details) (USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 | Aug. 13, 2014 | Aug. 12, 2014 |
2006 Plan and 2012 Plan | ||||
Stock options and restricted shares | ||||
Share-based compensation expense (in dollars) | $1,220 | $893 | ||
2006 Plan and 2012 Plan | Stock option | ||||
Weighted average assumptions | ||||
Expected life | 4 years 10 months 24 days | 6 years | ||
Risk-free interest rate (as a percent) | 1.70% | 1.70% | ||
Volatility (as a percent) | 63.00% | 55.00% | ||
Dividend yield (as a percent) | 0.00% | 0.00% | ||
Forfeiture rate (as a percent) | 13.10% | 10.00% | ||
Weighted-average grant date fair value of options granted (in dollars per share) | $1.21 | $1.69 | ||
Total grant date fair value (in dollars) | 803 | 588 | ||
Number Of Shares | ||||
Outstanding at beginning of year (in shares) | 1,409,812 | |||
Granted (in shares) | 664,000 | 348,000 | ||
Exercised (in shares) | -6,000 | |||
Canceled (in shares) | -338,447 | |||
Outstanding at end of year (in shares) | 1,729,365 | 1,409,812 | ||
Options exercisable at the end of the period (in shares) | 1,264,918 | |||
Weighted-Average Exercise Price | ||||
Outstanding at beginning of period (in dollars per share) | $3.92 | |||
Granted (in dollars per share) | $2.24 | |||
Exercised (in dollars per share) | $3.16 | |||
Canceled (in dollars per share) | $3.81 | |||
Outstanding at end of year (in dollars per share) | $3.30 | $3.92 | ||
Options exercisable at the end of the period (in dollars per share) | $3.43 | |||
Outstanding stock options expected to vest (in shares) | 1,654,449 | |||
Intrinsic value of options exercised (in dollars) | $6 | $3 | ||
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 | 1,100,000 | 1,100,000 | 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 | Jan. 03, 2015 | Dec. 31, 2013 |
Options Outstanding | ||
Number Outstanding (in shares) | 1,729,365 | |
Remaining Contractual Life | 5 years 4 months 24 days | |
Weighted Average Exercise Price (in dollars per share) | $3.30 | |
Aggregate intrinsic value of options outstanding (in dollars) | $886 | $3 |
Options Exercisable | ||
Number Exercisable (in shares) | 1,264,918 | |
Remaining Contractual Life | 4 years 7 months 6 days | |
Weighted Average Exercise Price (in dollars per share) | $3.43 | |
Aggregate intrinsic value of options exercisable (in dollars) | $3 | $0 |
$1.89 - $2.00 | ||
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) | $2 | |
Options Outstanding | ||
Number Outstanding (in shares) | 194,750 | |
Remaining Contractual Life | 9 years 2 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $1.86 | |
Options Exercisable | ||
Number Exercisable (in shares) | 29,750 | |
Remaining Contractual Life | 9 years | |
Weighted Average Exercise Price (in dollars per share) | $1.85 | |
$2.01 $3.00 | ||
Stock options outstanding and exercisable by exercise price range | ||
Exercise price, low end of range (in dollars per share) | $2.01 | |
Exercise price, high end of range (in dollars per share) | $3 | |
Options Outstanding | ||
Number Outstanding (in shares) | 777,000 | |
Remaining Contractual Life | 4 years 10 months 24 days | |
Weighted Average Exercise Price (in dollars per share) | $2.20 | |
Options Exercisable | ||
Number Exercisable (in shares) | 730,656 | |
Remaining Contractual Life | 4 years 8 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $2.19 | |
$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) | 265,063 | |
Remaining Contractual Life | 7 years 2 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $3.34 | |
Options Exercisable | ||
Number Exercisable (in shares) | 59,315 | |
Remaining Contractual Life | 6 years 7 months 6 days | |
Weighted Average Exercise Price (in dollars per share) | $3.38 | |
$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) | 2,000 | |
Remaining Contractual Life | 9 years 7 months 6 days | |
Weighted Average Exercise Price (in dollars per share) | $4.06 | |
Options Exercisable | ||
Remaining Contractual Life | 0 years | |
$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) | 407,002 | |
Remaining Contractual Life | 3 years 3 months 18 days | |
Weighted Average Exercise Price (in dollars per share) | $5.33 | |
Options Exercisable | ||
Number Exercisable (in shares) | 364,947 | |
Remaining Contractual Life | 3 years 2 months 12 days | |
Weighted Average Exercise Price (in dollars per share) | $5.30 | |
$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) | 83,550 | |
Remaining Contractual Life | 6 years 3 months 18 days | |
Weighted Average Exercise Price (in dollars per share) | $6.94 | |
Options Exercisable | ||
Number Exercisable (in shares) | 80,250 | |
Remaining Contractual Life | 6 years 3 months 18 days | |
Weighted Average Exercise Price (in dollars per share) | $6.90 |
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 | Jan. 03, 2015 | Dec. 31, 2013 |
2006 Plan and 2012 Plan | Stock option | ||
Number of Options | ||
Non-vested options at the beginning of the period (in shares) | 467,668 | |
Options granted (in shares) | 664,000 | 348,000 |
Options vested (in shares) | -221,239 | |
Options forfeited (in shares) | -445,982 | |
Non-vested options at the end of the period (in shares) | 464,447 | 467,668 |
Weighted Average Exercise Price | ||
Non-vested options at the beginning of the period (in dollars per share) | $4.04 | |
Options granted (in dollars per share) | $2.24 | |
Options vested (in dollars per share) | $3.21 | |
Options forfeited (in dollars per share) | $2.93 | |
Non-vested options at the end of the period (in dollars per share) | $2.93 | $4.04 |
Weighted Average Grant Date Fair Value | ||
Non-vested options at the beginning of the period (in dollars per share) | $2.13 | |
Options granted (in dollars per share) | $1.21 | $1.69 |
Options vested (in dollars per share) | $1.72 | |
Options forfeited (in dollars per share) | $1.55 | |
Non-vested options at the end of the period (in dollars per share) | $1.57 | $2.13 |
Share based compensation, additional information | ||
Unrecognized compensation cost | $471 | |
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 | Jan. 03, 2015 |
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) | 268,361 |
Granted (in shares) | 237,064 |
Vested (in shares) | -152,010 |
Forfeited (in shares) | -111,166 |
Non Vested restricted stock awards at the end of the period (in shares) | 242,249 |
Grant Date Fair Value | |
Non Vested restricted stock awards at the beginning of the period (in dollars per share) | $4.09 |
Granted (in dollars per share) | $2.66 |
Vested (in dollars per share) | $3.90 |
Forfeited (in dollars per share) | $3.18 |
Non Vested restricted stock awards at the end of the period (in dollars per share) | $3.22 |
Restricted stock awards, additional disclosure | |
Unrecognized compensation cost | $455 |
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 | 230,744 |
2012 Incentive Compensation Plan | |
Additional information related to share based compensation | |
Shares available to grant | 636,375 |
CAPITAL_LEASE_OBLIGATIONS_Deta
CAPITAL LEASE OBLIGATIONS (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
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 | $211 | $678 |
Capital lease liability included in long-term debt | 70 | 228 |
Future Minimum Lease Payments | ||
Total | 219 | 715 |
2015 | 147 | |
2016 | 72 | |
Interest | ||
Total | -7 | |
2015 | -6 | |
2016 | -1 | |
Principal | ||
Total | 212 | |
2015 | 141 | |
2016 | $71 |
PROFIT_SHARING_PLAN_Details
PROFIT SHARING PLAN (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
PROFIT SHARING PLAN | ||
Maximum employee contributions as a percentage of compensation | 25.00% | |
Matching expense | $216 | $226 |
MAJOR_CUSTOMERS_Details
MAJOR CUSTOMERS (Details) (Sales, Customer concentration risk) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 31, 2013 | |
customer | item | |
Major customers | ||
Number of customers | 7 | 3 |
Percentage of concentration risk | 74.00% | 78.00% |
Toys R Us | ||
Major customers | ||
Percentage of concentration risk | 27.00% | 31.00% |
Walmart | ||
Major customers | ||
Percentage of concentration risk | 14.00% | 19.00% |
Target | ||
Major customers | ||
Percentage of concentration risk | 11.00% | 11.00% |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | 1 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 | Sep. 30, 2010 | Nov. 30, 2013 |
item | ||||
Future minimum rental payments due under leases | ||||
2015 | $1,936 | |||
2016 | 1,363 | |||
2017 | 339 | |||
2018 | 161 | |||
Total | 3,799 | |||
Rent expense (excluding taxes, fees and other charges) | 1,902 | 1,915 | ||
Summer Infant (USA), Inc. | ||||
Commitments and contingencies | ||||
Royalty expense | 1,847 | |||
Future minimum rental payments due under leases | ||||
Rent expense (excluding taxes, fees and other charges) | 915 | |||
Summer Infant (USA), Inc. | Warehouse space | ||||
Commitments and contingencies | ||||
Term of lease agreement | 72 months | |||
Amount of monthly rent payments | 64 | |||
Number of months of free rent under initial lease term | 10 months | |||
Number of monthly payments | 6 | |||
Summer Infant Europe Limited | ||||
Employment Contracts | ||||
Termination benefit provisions | 0 | |||
Summer Infant Europe Limited | Minimum | ||||
Employment Contracts | ||||
Employer's contribution as a percentage of employee's annual salary | 5.00% | |||
Summer Infant Europe Limited | Maximum | ||||
Employment Contracts | ||||
Employer's contribution as a percentage of employee's annual salary | 10.00% | |||
Summer Infant Europe Limited | Office | ||||
Commitments and contingencies | ||||
Term of lease agreement | 5 years | |||
Amount of monthly rent payments | 6 | |||
Summer Infant Canada, Ltd. | Office and warehouse space | ||||
Commitments and contingencies | ||||
Term of lease agreement | 5 years | |||
Amount of monthly rent payments | 27 | |||
Number of additional periods for which the lease can be renewed | 1 | |||
Additional period for which the lease can be renewed | 5 years | |||
Summer Infant Asia | Office | ||||
Commitments and contingencies | ||||
Term of lease agreement | 2 years | |||
Amount of monthly rent payments | $9 |
GEOGRAPHICAL_INFORMATION_Detai
GEOGRAPHICAL INFORMATION (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 31, 2013 |
Geographical information | ||
Net revenue | $205,359 | $208,173 |
Assets | 122,467 | 115,367 |
Long lived assets | 35,124 | 38,120 |
United States | ||
Geographical information | ||
Net revenue | 170,375 | 174,253 |
Assets | 100,302 | 94,033 |
Long lived assets | 27,180 | 30,858 |
All Other | ||
Geographical information | ||
Net revenue | 34,984 | 33,920 |
Assets | 22,165 | 21,334 |
Long lived assets | $7,944 | $7,262 |