Document_And_Entity_Informatio
Document And Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Aug. 01, 2014 | |
Document Information [Line Items] | ' | ' |
Entity Registrant Name | 'MusclePharm Corp | ' |
Entity Central Index Key | '0001415684 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Trading Symbol | 'MSLP | ' |
Entity Common Stock, Shares Outstanding | ' | 11,128,440 |
Document Type | '10-Q | ' |
Amendment Flag | 'true | ' |
Document Period End Date | 30-Jun-14 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Document Fiscal Year Focus | '2014 | ' |
Amendment Description | 'The following is Amendment No. 1 to the Quarterly Report on Form 10-Q for the six months ended June 30, 2014 (the “Form 10-Q”) of MusclePharm Corporation. This Amendment No. 1 is being filed to reflect certain restatements of the Company’s consolidated financial statements for the three months ended June 30, 2014 and for the six months ended June 30, 2014 (see Note 16 of Notes to Consolidated Financial Statements) and to revise certain disclosures and presentations in other parts of the Form 10-Q to be consistent with the restated consolidated financial statements. We also evaluated our consideration on the effectiveness of our internal controls in Item 4. This Amendment amends and supplements Items 1, 2, and 4 of Part I. All other statements and provisions in the Form 10-Q have not been updated and remain unchanged. | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Current assets: | ' | ' |
Cash | $3,768,840 | $5,411,515 |
Cash - restricted | 0 | 2,500,014 |
Investment in debt securities | 0 | 259,715 |
Accounts receivable - net of allowance for doubtful accounts | 19,197,544 | 13,741,180 |
Derivative instrument | 0 | 119,248 |
Inventory - net | 19,769,356 | 15,772,368 |
Prepaid giveaways | 975,450 | 1,177,539 |
Prepaid stock compensation | 3,018,940 | 3,023,717 |
Prepaid sponsorship and endorsement fees | 151,892 | 1,145,161 |
Prepaid expenses | 1,989,597 | 1,335,218 |
Other assets | 333,240 | 40,805 |
Total current assets | 49,204,859 | 44,526,480 |
Property and equipment - net | 6,221,261 | 2,613,584 |
Intangible assets - net | 6,732,532 | 155,165 |
Prepaid stock compensation | 3,251,791 | 4,718,238 |
Other assets | 179,632 | 144,229 |
Total assets | 65,590,075 | 52,157,696 |
Current liabilities: | ' | ' |
Accounts payable | 23,900,432 | 26,605,588 |
Accrued liabilities | 4,527,085 | 2,053,101 |
Line of credit | 0 | 2,500,000 |
Notes payable | 45,600 | 62,502 |
Derivative liabilities | 0 | 1,147,330 |
Total current liabilities | 28,473,117 | 32,368,521 |
Other long-term liabilities | 366,378 | 54,639 |
Total liabilities | 28,839,495 | 32,423,160 |
Commitments and Contingencies (Note 10) | ' | ' |
Stockholders' Equity: | ' | ' |
Common Stock, $0.001 par value; 100,000,000 shares authorized; 10,782,833 and 9,259,411 shares issued, respectively; 10,612,912 and 9,089,490 shares issued and outstanding, respectively | 10,783 | 9,260 |
Additional paid-in capital | 118,259,128 | 103,064,901 |
Treasury stock at cost; 169,921 shares | -1,498,298 | -1,498,298 |
Accumulated other comprehensive income (loss) | 4,665 | -14,042 |
Accumulated deficit | -80,025,698 | -81,827,417 |
Total stockholders’ equity | 36,750,580 | 19,734,536 |
Total Liabilities and Stockholders' Equity | 65,590,075 | 52,157,696 |
Series D Convertible Preferred Stock [Member] | ' | ' |
Stockholders' Equity: | ' | ' |
Series D, Convertible Preferred Stock, $0.001 par value; 1,600,000 shares authorized; 1,500,000 shares issued; none and 131,500 shares issued and outstanding, respectively | $0 | $132 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets [Parenthetical] (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 10,782,833 | 9,259,411 |
Common Stock, shares outstanding | 10,612,912 | 9,089,490 |
Treasury Stock, shares | 169,921 | 169,921 |
Series D Convertible Preferred Stock [Member] | ' | ' |
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 1,600,000 | 1,600,000 |
Preferred stock, shares issued | 1,500,000 | 1,500,000 |
Preferred stock, shares outstanding | 0 | 131,500 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Sales - net | $46,739,987 | $25,480,059 | $96,949,441 | $48,041,226 |
Cost of sales | 31,093,224 | 17,566,718 | 63,429,609 | 31,963,124 |
Gross profit | 15,646,763 | 7,913,341 | 33,519,832 | 16,078,102 |
Operating expenses: | ' | ' | ' | ' |
Advertising and promotion | 5,919,263 | 3,275,200 | 12,247,749 | 5,592,577 |
Salaries and benefits | 5,777,488 | 1,563,909 | 11,144,295 | 2,812,368 |
Selling, general, and administrative | 2,356,940 | 1,918,665 | 4,229,308 | 3,064,220 |
Research and development | 1,163,883 | 169,231 | 2,260,829 | 259,361 |
Professional fees | 1,292,517 | 3,727,267 | 2,077,090 | 7,811,986 |
Total operating expenses | 16,510,091 | 10,654,272 | 31,959,271 | 19,540,512 |
Operating income (loss) | -863,328 | -2,740,931 | 1,560,561 | -3,462,410 |
Other income (expense), net: | ' | ' | ' | ' |
Derivative expense | 0 | 0 | 0 | -96,913 |
Change in fair value of derivative liabilities | -110,289 | 272,681 | 373,944 | -5,771,963 |
Gain on settlement of accounts payable | 25,978 | 47,671 | 31,477 | 324,656 |
Interest expense | -17,015 | -1,125 | -56,388 | -781,445 |
Foreign currency transaction loss | -4,390 | -104 | -34,496 | -5,714 |
Loss on derivative instrument and debt security | 0 | 0 | -386,103 | 0 |
Interest income | 0 | 0 | 223,049 | 0 |
Other income, net | 79,315 | 0 | 166,622 | 10,000 |
Total other income (expense), net | -26,401 | 319,123 | 318,105 | -6,321,379 |
Net income (loss) before taxes | -889,729 | -2,421,808 | 1,878,666 | -9,783,789 |
Provision for income taxes | -44,786 | 0 | -76,947 | 0 |
Net income (loss) | -934,515 | -2,421,808 | 1,801,719 | -9,783,789 |
Other comprehensive income (loss) | ' | ' | ' | ' |
Net change in foreign currency translation | 22,954 | 4,228 | 18,707 | -1,841 |
Total other comprehensive income (loss) | 22,954 | 4,228 | 18,707 | -1,841 |
Total comprehensive income (loss) | ($911,561) | ($2,417,580) | $1,820,426 | ($9,785,630) |
Net income (loss) per share: | ' | ' | ' | ' |
Basic (in dollars per share) | ($0.09) | ($0.34) | $0.17 | ($1.72) |
Diluted (in dollars per share) | ($0.09) | ($0.34) | $0.15 | ($1.72) |
Weighted average number of shares used in per share calculations - Basic (in shares) | 10,610,022 | 7,226,849 | 10,459,522 | 5,686,323 |
Weighted average number of shares used in per share calculations - Diluted (in shares) | 10,610,022 | 7,226,849 | 11,863,882 | 5,686,323 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Cash Flows From Operating Activities: | ' | ' |
Net income (loss) | $1,801,719 | ($9,783,789) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ' | ' |
Depreciation of property and equipment | 646,673 | 333,383 |
Bad debt | 140,155 | 105,271 |
Amortization of prepaid stock compensation | 1,577,882 | 3,345,332 |
Amortization of prepaid sponsorships fees | 3,468,227 | 1,834,922 |
Amortization of intangible assets | 578,295 | 0 |
Stock-based compensation | 4,466,876 | 74,366 |
Amortization of debt issuance costs | 0 | 335,433 |
Accretion of conversion option on debt security | -222,140 | 0 |
Gain on settlement of accounts payable | -31,477 | -324,656 |
Loss on disposal of property and equipment | 30,606 | 0 |
Derivative expense | 0 | 96,913 |
Loss on sale of debt security and derivative instrument | 386,103 | 0 |
Change in fair value of derivative liabilities | -373,944 | 5,771,963 |
Changes in operating assets and liabilities, net of acquisition: | ' | ' |
Accounts receivable | -4,790,307 | -5,713,366 |
Inventory | -3,155,989 | -170,254 |
Prepaid giveaways | 202,089 | 257,120 |
Prepaid assets | -3,114,827 | -2,410,550 |
Other assets | 235,105 | -666,618 |
Accounts payable | -2,664,980 | 80,187 |
Accrued liabilities | 1,074,592 | 1,660,385 |
Other long-term liabilities | 285,230 | 0 |
Net Cash Provided by (Used in) Operating Activities | 539,888 | -5,173,958 |
Cash Flows From Investing Activities: | ' | ' |
Purchase of property and equipment | -2,401,182 | -307,760 |
Change in restricted cash balance | 2,500,014 | 9,148 |
Proceeds from sale of debt security | 215,000 | 0 |
Proceeds from disposal of property and equipment | 1,800 | 1,694 |
Purchase of trademark | 0 | -47,500 |
Net Cash Provided by (Used In) Investing Activities | 315,632 | -344,418 |
Cash Flows From Financing Activities: | ' | ' |
Payment on line of credit | -2,500,000 | 0 |
Payment on notes payable | -16,902 | -4,393,234 |
Stock issuance costs | 0 | -1,662,667 |
Proceeds from issuance of preferred stock | 0 | 12,000,000 |
Proceeds from issuance of common stock and warrants | 0 | 8,327,499 |
Repurchase of common stock (treasury stock) | 0 | -103,537 |
Net Cash (Used In) Provided by Financing Activities | -2,516,902 | 14,168,061 |
Effect of exchange rates on cash and cash equivalents | 18,707 | 6,076 |
Net (decrease) increase in cash | -1,642,675 | 8,655,761 |
Cash at beginning of period | 5,411,515 | 0 |
Cash at end of period | 3,768,840 | 8,655,761 |
Supplemental disclosures of cash flow information: | ' | ' |
Cash paid for interest | 52,835 | 410,502 |
Cash paid for taxes | 77,212 | 0 |
Supplemental disclosure of non-cash investing and financing activities: | ' | ' |
Stock issued for future services - third parties | 0 | 4,409,897 |
Warrants issued in conjunction with equity issuances | 0 | 8,175,459 |
Stock issued to settle accounts payable and accrued expenses- third parties | 0 | 5,484,947 |
Stock issued for Biozone acquisition | 9,840,000 | 0 |
Stock issued for board compensation | 115,358 | 114,912 |
Reclassification of derivative liability to additional paid in capital | 773,386 | 0 |
Capital leases | $26,509 | $0 |
Nature_of_Operations_and_Basis
Nature of Operations and Basis of Presentation | 6 Months Ended |
Jun. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Business Description and Basis of Presentation [Text Block] | ' |
Note 1: Nature of Operations and Basis of Presentation | |
MusclePharm Corporation (the “Company”) is a scientifically driven, performance lifestyle Company that develops, manufactures, markets and distributes branded nutritional supplements. The Company was incorporated in Nevada in 2006, and principal executive offices are located in Denver, Colorado. | |
The accompanying interim unaudited consolidated financial statements as of June 30, 2014 and 2013, and for the three and six months then ended, have been prepared by the Company in accordance with generally accepted accounting principles (“GAAP”) in the United States (“U.S.”) for interim financial information. The amounts as of December 31, 2013 have been derived from the Company’s annual audited financial statements. In the opinion of management, the accompanying unaudited consolidated financial statements reflect all adjustments necessary (consisting of normal recurring adjustments) to state fairly the financial position of the Company and its results of operations and cash flows as of and for the periods presented. These financial statements should be read in conjunction with the annual audited financial statements and notes thereto as of and for the year ended December 31, 2013, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013, filed on March 31, 2014 (the “Form 10-K”). | |
The results of operations for the three and six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2014 or any future period and the Company makes no representations related thereto. | |
Reclassification | |
The Company has reclassified certain prior period amounts to conform to the current period presentation. These reclassifications had no effect on the financial position, results of operations or cash flows for the periods presented. | |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 6 Months Ended | ||
Jun. 30, 2014 | |||
Accounting Policies [Abstract] | ' | ||
Significant Accounting Policies [Text Block] | ' | ||
Note 2: Summary of Significant Accounting Policies | |||
Principles of Consolidation | |||
The consolidated financial statements include the accounts of MusclePharm Corporation and its wholly-owned subsidiaries MusclePharm Canada Enterprises Corp (“MusclePharm Canada”) and Biozone Laboratories, Inc. (“Biozone”). MusclePharm Canada began operations in April 2012 and Biozone was acquired in January 2014. All intercompany accounts and transactions have been eliminated upon consolidation. | |||
Use of Estimates | |||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The accounting estimates and assumptions that require management’s most significant, difficult, and subjective judgment include the recognition and measurement of allowance for doubtful accounts, inventory reserve, derivatives, and sales discounts and allowances reserve among others. Actual results experienced by the Company may differ from management’s estimates. | |||
Risks and Uncertainties | |||
The Company operates in an industry that is subject to rapid change and intense competition. The Company’s operations will be subject to significant risk and uncertainties including financial, operational, technological, regulatory, industry adverse publicity and other risks, including the potential risk of business failure. | |||
Recent Accounting Pronouncements | |||
In May 2014, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for revenue recognition. The amendments are based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. MusclePharm is required to adopt the amendments in the first quarter of 2017. Early adoption is not permitted. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. MusclePharm is currently evaluating the impact of these amendments and the transition alternatives on its Consolidated Financial Statements. | |||
Cash and Cash Equivalents | |||
The Company considers all highly liquid instruments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. At June 30, 2014 and December 31, 2013, respectively, the Company had no cash equivalents. | |||
The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The cash balance at times may exceed federally insured limits, and at June 30, 2014 we had one bank account that exceeded the federally insured limit, and at December 31, 2013 we had two bank accounts that exceeded the federally insured limit. | |||
Accounts Receivable and Allowance for Doubtful Accounts | |||
Accounts receivable represents trade obligations from customers that are subject to normal trade collection terms. The Company’s finance department monitors the status of customer receivables and takes actions to collect past due balances as necessary. The Company periodically evaluates the collectability of its accounts receivable and considers the need to establish an allowance for doubtful accounts based upon historical collection experience and specific customer information. Accordingly, the actual amounts could vary from the recorded allowances. There is also a review of customer discounts at the period end and an accrual made for discounts earned but not yet utilized by period end. | |||
Management performs ongoing evaluations of the Company’s customers’ financial condition and generally does not require collateral. Some international customers are required to pay for their orders in advance of shipment. Management reviews accounts receivable quarterly and reduces the carrying amount by a valuation allowance that reflects management’s best estimate of amounts that may not be collectible. Allowances, if any, for uncollectible accounts receivable are determined based upon the aging of accounts receivable, changes in customer credit worthiness, general market and economic conditions, and historical experience. Bad debt expense recognized as a result of our valuation allowance is classified under Selling, general and administrative expense in the Consolidated Statement of Operations. | |||
The Company does not charge interest on past due receivables. Receivables are determined to be past due based on the payment terms of the original invoices. | |||
Inventory | |||
Inventory is valued at the lower of cost or market value. The cost of product inventory for MusclePharm and MusclePharm Canada is computed using actual cost on a First-In First-Out basis, and the cost of inventory for Biozone is computed using an average cost basis. Adjustments to reduce the cost of inventory to its net realizable value are made, if required, and estimates are made for obsolescence, excess or slow-moving inventories, non-conforming inventories, and expired inventory. | |||
Prepaid Giveaways | |||
Prepaid giveaways represent non-inventory samples, which are given away to aid in promotion of the brand and products. | |||
Prepaid Sponsorship and Endorsement Fees | |||
Prepaid sponsorship and endorsement fees represent fees paid in connection with Company sponsorships of certain events and trade shows as well as prepaid athlete endorsement fees, which are expensed over the period the fees are earned. A significant amount of the Company’s promotional expenses results from payments under endorsement and sponsorship contracts. Accounting treatment for endorsement and sponsorship payments is based upon specific contract provisions. Generally, endorsement and sponsorship payments are expensed straight-line over the term of the contract after giving recognition to periodic performance compliance provisions of the contract. Prepayments made under the contracts are included in either current or long-term prepaid expenses depending on the performance period for which the prepayment applies. | |||
Prepaid Stock Compensation | |||
Prepaid stock compensation represents amounts paid with stock for future contractual benefits to be received. The Company amortizes these contractual benefits over the life of the contracts using the straight-line method. | |||
Prepaid Expenses | |||
Prepaid expenses consist of various payments that the Company has made in advance for goods or services to be received in the future. These prepaid expenses include legal retainers, print advertising, insurance and service contracts requiring up-front payments. | |||
Property and Equipment | |||
Property and equipment are stated at cost and depreciated to their estimated residual value over their estimated useful lives. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation are relieved from the accounts and the resulting gains or losses are included in the Statements of Operations. Repairs and maintenance costs are expensed as incurred. Depreciation is provided using the straight-line method for all property and equipment. We review our property and equipment for impairment when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. We use an estimate of future undiscounted net cash flows of the related assets or groups of assets over their remaining lives in measuring whether the assets are recoverable. An impairment loss is calculated by determining the difference between the carrying values and the estimated fair values of these assets. We did not consider any of our property and equipment to be impaired during the six months ended June 30, 2014 or 2013. | |||
Intangible Assets | |||
Definite-lived intangible assets are amortized over their related useful lives, using a straight-line basis consistent with the underlying expected future cash flows related to the specific intangible asset. Intangible assets are reviewed for impairment whenever events or changes in circumstances exist that indicate the carrying amount of an asset may not be recoverable. When indicators of impairment exist, an estimate of undiscounted net cash flows is used in measuring whether the carrying amount of the asset or related asset group is recoverable. Measurement of the amount of impairment, if any, is based upon the difference between the asset's carrying value and estimated fair value. Fair value is determined through various valuation techniques, including market and income approaches as considered necessary. See Note 15 for further disclosure of intangible assets. | |||
Accrued Liabilities | |||
Accrued liabilities consist of amounts estimated by management for future liability payments that relate to the current accounting period. Management reviews these estimates periodically to determine their reasonableness and fair presentation. | |||
Debt | |||
The Company defines short term debt as any debt payment due less than one year from the date of the financial statements. Long term debt is defined as any debt payment due more than one year from the date of the financial statements. Refer to Note 6 for further disclosure of debt liabilities. | |||
Derivatives | |||
Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in equity instruments and warrants granted, and measurement of their fair value. In determining the appropriate fair value, the Company uses Black-Scholes or lattice option-valuation models. In assessing the convertible equity instruments, management determines if the convertible equity instrument is conventional convertible equity and further if the beneficial conversion feature requires separate measurement. | |||
Once derivative instruments are determined, they are adjusted to reflect fair value at the end of each reporting period. Any increase or decrease in the fair value is recorded in results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using a Black-Scholes or lattice option-pricing model. Once a derivative liability ceases to exist any remaining fair value is reclassified to additional paid-in capital if redeemed or through earnings if forfeited or expired. | |||
Fair Value of Financial Instruments | |||
The Company measures assets and liabilities at fair value based on an expected exit price which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. | |||
The following are the hierarchical levels of inputs to measure fair value: | |||
· | Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. | ||
· | Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. | ||
· | Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. | ||
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. | |||
The Company’s financial instruments consisted primarily of accounts receivable, accounts payable, accrued liabilities, and notes payable. The Company’s notes payable approximate fair value based upon current borrowing rates available to the Company for debt with similar maturities. The carrying amounts of the Company’s financial instruments generally approximated their fair values as of June 30, 2014 and December 31, 2013, respectively, due to the short-term nature of these instruments. | |||
Stock-Based Compensation | |||
Generally, all forms of stock-based compensation, including stock option grants, warrants and restricted stock grants and stock appreciation rights are measured at their fair value on the awards’ grant date, based on estimated number of awards that are ultimately expected to vest. Share-based compensation awards issued to non- employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the stock-based compensation, whichever is more readily determinable. | |||
Revenue Recognition | |||
The Company derives revenue primarily from sale of products. The Company records revenue when all of the following have occurred: (1) persuasive evidence of an arrangement exists, (2) product has been shipped or delivered, (3) the sales price to the customer is fixed or determinable, and (4) collectability is reasonably assured. | |||
Depending on individual customer agreements, sales are recognized either upon shipment of products to customers or upon delivery. For all Canadian sales, which represent 3% of total sales, recognition occurs upon shipment. | |||
The Company records sales allowances and discounts as a direct reduction of sales. The Company grants volume incentive rebates to certain customers based on contractually agreed upon percentages once certain thresholds have been met. These volume incentive rebates are recorded as a direct reduction to sales. | |||
The Company has determined that customer advertising related credits are accounted for based on the guidance of ASC No. 605-50-55 (“Revenue Recognition” – Customer Payments and Incentives), which indicates that, absent evidence of benefit to the vendor, appropriate treatment requires netting these types of payments against revenues and not expensing as advertising expense. | |||
Advertising and Promotion | |||
Advertising and promotion expenses include digital and print advertising, trade show events, athletic endorsements and sponsorships, and promotional giveaways. Advertising expenses are recognized in the month that the advertising appears while costs associated with trade show events are expensed when the event occurs. For major trade shows, the expenses are recognized within the calendar year over the period in which we recognize revenue associated with sales generated at the trade show. Costs related to promotional giveaways are expensed when the product is either given out at a promotional event or shipped to the customer. | |||
A significant amount of the Company’s promotional expenses results from payments under endorsement and sponsorship contracts. Accounting treatment for endorsement and sponsorship payments is based upon specific contract provisions. Generally, endorsement payments are expensed straight-line over the term of the contract after giving recognition to periodic performance compliance provisions of the contract. Prepayments made under the contracts are included in either current or long-term prepaid expenses depending on the period for which the prepayment applies. | |||
Some of the contracts provide for contingent payments to endorsers or athletes based upon specific achievement in their sports (e.g. winning a championship). The Company records expense for these payments when the endorser achieves the specific achievement. | |||
Income Taxes | |||
Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Beginning with the adoption of Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes, (included in FASB ASC Subtopic 740-10, Income Taxes — Overall), the Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely to be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. | |||
The Company records interest and penalties related to unrecognized tax benefits in income tax expense. There were no interest or penalties related to unrecognized tax benefits for the three and six months ended June 30, 2014 and 2013. | |||
Foreign Currency | |||
MusclePharm began operations in Canada in April 2012. The Canadian Dollar was determined to be the functional currency as the majority of the transactions related to the day to day operations of the business are in Canadian Dollars. At the end of the period, the financial results of the Canadian operation are translated into the U.S. Dollar, which is the reporting currency, and added to the U.S. operations for consolidated company financial results. The revenue and expense items are translated using the average rate for the month and the assets and liabilities at the month end of rate. Transactions that have completed the accounting cycle and resulted in a gain or loss related to translation are recorded in realized gain or loss due to foreign currency translation under other income and expense on the income statement. Transactions that have not completed their accounting cycle but appear to have gain or loss due to the translation process are recorded as unrealized gain or loss due to translation and recorded as Accumulated other comprehensive income (loss) in the equity section on the balance sheet until such date the accounting cycle of the transaction is complete and the actual realized gain or loss is recognized. | |||
Composition_of_Certain_Financi
Composition of Certain Financial Statement Captions | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Composition of Certain Financial Statement Captions Abstract [Abstract] | ' | ||||||||||||||||
Composition of Certain Financial Statement Captions [Text Block] | ' | ||||||||||||||||
Note 3: Composition of Certain Financial Statement Captions | |||||||||||||||||
Accounts Receivable | |||||||||||||||||
Accounts receivable, net of allowance consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Accounts receivable | $ | 19,849,929 | $ | 14,830,487 | |||||||||||||
Less: allowance for discounts | -511,066 | -1,060,000 | |||||||||||||||
Less: allowance for doubtful accounts | -141,319 | -29,307 | |||||||||||||||
Accounts receivable – net | $ | 19,197,544 | $ | 13,741,180 | |||||||||||||
Inventory | |||||||||||||||||
Inventory, net consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Raw materials inventory | $ | 970,538 | $ | - | |||||||||||||
Work in process inventory | 170,843 | - | |||||||||||||||
Finished goods inventory | 18,756,934 | 16,001,515 | |||||||||||||||
Inventory reserve | -128,959 | -229,147 | |||||||||||||||
Total inventory - net | $ | 19,769,356 | $ | 15,772,368 | |||||||||||||
Finished goods inventory purchased from third party manufacturers as of June 30, 2014 and December 31, 2013 was $18,693,505 and $16,001,515, respectively. Any damaged packaging is returned to the manufacturer for replacement. | |||||||||||||||||
Prepaid Expenses | |||||||||||||||||
Prepaid expenses consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Prepaid advertising and promotion | $ | 700,707 | $ | 760,740 | |||||||||||||
Prepaid inventory | 385,679 | - | |||||||||||||||
Prepaid insurance | 263,632 | 280,878 | |||||||||||||||
Prepaid professional services | 226,120 | 74,730 | |||||||||||||||
Prepaid director fees | 116,000 | - | |||||||||||||||
Prepaid research & development fees | 84,221 | 22,500 | |||||||||||||||
Prepaid license fees | 77,141 | 90,623 | |||||||||||||||
Prepaid software license fees | 40,743 | 86,205 | |||||||||||||||
Prepaid support agreements | 36,697 | 3,499 | |||||||||||||||
Prepaid – other | 58,657 | 16,043 | |||||||||||||||
$ | 1,989,597 | $ | 1,335,218 | ||||||||||||||
Other Current Assets | |||||||||||||||||
Other current assets consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Vendor rebate receivable | $ | 119,467 | $ | - | |||||||||||||
Other receivable from Cocrystal Pharma, Inc. | 209,396 | - | |||||||||||||||
Other current assets | 4,377 | 40,805 | |||||||||||||||
$ | 333,240 | $ | 40,805 | ||||||||||||||
Property and Equipment | |||||||||||||||||
Property and equipment consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of June 30, 2014 | As of December 31, 2013 | Estimated Useful Life | |||||||||||||||
Furniture, fixtures and equipment | $ | 3,173,284 | $ | 1,849,462 | From 3 to 5 years | ||||||||||||
Leasehold improvements | 2,189,963 | 619,159 | From 20 to 182 months | ||||||||||||||
Manufacturing and lab equipment | 1,231,251 | - | From 2 to 20 years | ||||||||||||||
Vehicles | 444,065 | 442,300 | From 2 to 5 years | ||||||||||||||
Displays | 33,683 | 33,683 | 5 years | ||||||||||||||
Website | 15,975 | 11,462 | 3 years | ||||||||||||||
Construction in process | 1,128,588 | 1,018,509 | |||||||||||||||
Total | 8,216,809 | 3,974,575 | |||||||||||||||
Less: Accumulated depreciation and amortization | -1,995,548 | -1,360,991 | |||||||||||||||
$ | 6,221,261 | $ | 2,613,584 | ||||||||||||||
Other Assets | |||||||||||||||||
Other assets consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Security deposit | $ | 108,394 | $ | 85,419 | |||||||||||||
Long-term portion of prepaid assets | 71,238 | 58,810 | |||||||||||||||
$ | 179,632 | $ | 144,229 | ||||||||||||||
Accrued Liabilities | |||||||||||||||||
Accrued liabilities consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Accrued payables | $ | 2,606,779 | $ | 487,415 | |||||||||||||
Employee compensation and benefits | 1,717,265 | 1,137,681 | |||||||||||||||
Capital leases | 77,327 | 26,653 | |||||||||||||||
Customer deposits | 67,747 | 265,652 | |||||||||||||||
Accrued taxes | 25,832 | 71,771 | |||||||||||||||
Other | 32,135 | 63,929 | |||||||||||||||
$ | 4,527,085 | $ | 2,053,101 | ||||||||||||||
Other Long-Term Liabilities | |||||||||||||||||
Other long-term liabilities consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Customer deposit | $ | 250,000 | $ | - | |||||||||||||
Long-term portion of capital lease liability | 116,378 | 54,639 | |||||||||||||||
$ | 366,378 | $ | 54,639 | ||||||||||||||
Sales and Discounts | |||||||||||||||||
Sales for the three and six months ended June 30, 2014 and 2013 were as follows: | |||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Sales | $ | 51,828,561 | $ | 28,515,483 | $ | 108,533,847 | $ | 53,439,519 | |||||||||
Discounts and returns | -5,088,574 | -3,035,424 | -11,584,406 | -5,398,293 | |||||||||||||
Sales - Net | $ | 46,739,987 | $ | 25,480,059 | $ | 96,949,441 | $ | 48,041,226 | |||||||||
Discounts as a percent of gross sales | 10 | % | 11 | % | 11 | % | 10 | % | |||||||||
The Company has an informal seven day right of return for products. There were nominal returns for the three and six months ended June 30, 2014 and 2013. | |||||||||||||||||
The Company offers various discounts and sales allowances for volume rebate programs, product promotions, early payment remittances, and other discounts and allowances. The Company accounts for sales discounts and allowances over the period they are earned. Because of the inherent uncertainty surrounding volume rebate programs and product promotions that are based on sales thresholds, actual results could generate liabilities greater or less than the amounts estimated and recorded. | |||||||||||||||||
Cost of Sales | |||||||||||||||||
Cost of sales for MusclePharm and MusclePharm Canada represent costs directly related to the production, manufacturing and freight of the Company’s products purchased from third party manufacturers. For products produced by Biozone, cost of sales consists of costs for raw material, direct labor, freight expenses, and other supply and equipment rental expenses used to manufacture products. | |||||||||||||||||
The Company mainly ships customer orders from our distribution center in Franklin, Tennessee. The facility is operated with the Company’s equipment and employees, and all inventory is owned by the Company. Shipments to customers from our distribution center are recorded as a component of cost of sales. The Company also utilizes a manufacturer in New York to manufacture one of the Company’s products. These orders are typically large and heavy, and are drop shipped directly to our customers at the time of order. Costs associated with these shipments are recorded in cost of sales. | |||||||||||||||||
The Company ships Canadian customer orders from our Canadian warehouse and records freight in cost of sales. | |||||||||||||||||
The Company ships Biozone products from our manufacturing facility in Pittsburg, California and records freight in cost of sales. | |||||||||||||||||
Concentrations
Concentrations | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Risks and Uncertainties [Abstract] | ' | ||||||||
Concentration Risk Disclosure [Text Block] | ' | ||||||||
Note 4: Concentrations | |||||||||
Accounts Receivable | |||||||||
At June 30, 2014 and December 31, 2013, the Company had the following concentrations of accounts receivable with significant customers: | |||||||||
Customer | As of June 30, 2014 | As of December 31, 2013 | |||||||
A | 10 | % | 16 | % | |||||
B | 10 | % | * | % | |||||
C | * | % | 24 | % | |||||
Bodybuilding.com | * | % | 14 | % | |||||
* Less than 10% of total accounts receivable | |||||||||
Revenue | |||||||||
The Company had the following concentrations of revenues with significant customers: | |||||||||
Three Months Ended June 30, | |||||||||
Customer | 2014 | 2013 | |||||||
Bodybuilding.com | 15 | % | 25 | % | |||||
B | 10 | % | * | % | |||||
C | * | % | 11 | % | |||||
Six Months Ended June 30, | |||||||||
Customer | 2014 | 2013 | |||||||
Bodybuilding.com | 15 | % | 29 | % | |||||
B | 10 | % | 11 | % | |||||
C | * | % | * | % | |||||
* Less than 10% of gross sales | |||||||||
Vendors | |||||||||
The Company uses four non-affiliated principal manufacturers for the components of our products. We have a manufacturing agreement in place with our primary manufacturer to support our growth and ensure consistency in production and quality. The agreement ensures products are manufactured to the Company’s specifications and the manufacturer will bear the costs of any recalled product due to defective manufacturing. The Company had the following concentration of purchases from product vendors: | |||||||||
Three Months Ended June 30, | |||||||||
Vendor | 2014 | 2013 | |||||||
A | 47 | % | 70 | % | |||||
B | 50 | % | 30 | % | |||||
Six Months Ended June 30, | |||||||||
Vendor | 2014 | 2013 | |||||||
A | 50 | % | 82 | % | |||||
B | 47 | % | 18 | % | |||||
Financial_Instruments
Financial Instruments | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Fair Value Disclosures [Abstract] | ' | |||||||
Fair Value Disclosures [Text Block] | ' | |||||||
Note 5: Financial Instruments | ||||||||
The following table is a summary of financial assets and liabilities: | ||||||||
As of June 30, | As of December 31, | |||||||
2014 | 2013 | |||||||
Assets | ||||||||
Debt securities – FUSE convertible notes (Level 2) | $ | - | $ | 259,715 | ||||
Derivative instruments – FUSE warrants (Level 2) | - | 119,248 | ||||||
- | 378,963 | |||||||
Liabilities | ||||||||
Derivative liabilities - Series D shares (Level 2) | $ | - | $ | 1,147,330 | ||||
On April 2, 2014, the Company entered into a security purchase agreement and sold the Fuse convertible note and warrants for an aggregate purchase price of $215,000. | ||||||||
Also on April 2, 2014 the remaining outstanding shares of Series D preferred stock were converted into common shares thereby eliminating the remaining derivative liability for the embedded conversion option as of that date. | ||||||||
Debt
Debt | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Debt Disclosure [Text Block] | ' | |||||||
Note 6: Debt | ||||||||
Debt consists of the following: | ||||||||
As of June 30, 2014 | As of December 31, 2013 | |||||||
Notes payable | $ | 45,600 | $ | 59,600 | ||||
Revolving line of credit | - | 2,500,000 | ||||||
Auto loan - secured | - | 2,902 | ||||||
Total debt | 45,600 | 2,562,502 | ||||||
Less: current portion | -45,600 | -2,562,502 | ||||||
Long term debt | $ | - | $ | - | ||||
Notes Payable | ||||||||
Notes payable consisted of the following activity and terms: | ||||||||
Balance – December 31, 2013 | $ | 59,600 | ||||||
Principal repayments | -14,000 | |||||||
Balance – June 30, 2014 | $ | 45,600 | ||||||
Debt in default of $45,600 and $59,600 at June 30, 2014 and December 31, 2013, respectively, is included as a component of short-term debt. Debt in default is related to certain convertible notes issued in 2012 and prior where the notes were never converted to common stock or principal repaid. The Company is in the process of contacting the note holders and negotiating settlement of the notes. | ||||||||
Revolving Line of Credit | ||||||||
On December 24, 2013, the Company entered into a revolving line of credit with U.S. Bank, N.A. in the amount of $2,500,000. The line of credit matures on September 15, 2014 and accrues interest at prime plus 2%, which is payable monthly. The note is secured by a $2,500,000 savings account held at U.S. Bank, N.A. and disclosed as restricted cash in the Consolidated Balance Sheets as of December 31, 2013. On May 12, 2014, the Company repaid the outstanding balance of the line of credit with the restricted cash balance that was securing the debt, and terminated the line of credit agreement. The line of credit will not be available for further borrowing. | ||||||||
Vehicle Loan | ||||||||
Vehicle loan account consisted of the following activity and terms: | ||||||||
Balance - December 31, 2013 | $ | 2,902 | ||||||
Principal repayments | -2,902 | |||||||
Balance – June 30, 2014 | $ | - | ||||||
As of December 31, 2013, the interest rate associated with this loan was 6.99%. The three final monthly payments of $1,008 per were paid in first quarter 2014. | ||||||||
Derivative_Liabilities
Derivative Liabilities | 6 Months Ended | ||||
Jun. 30, 2014 | |||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||
Derivatives and Fair Value [Text Block] | ' | ||||
Note 7: Derivative Liabilities | |||||
The Company identified conversion features embedded within Series D Preferred Stock issued in January 2013. The Company has determined that the features associated with the embedded conversion option should be accounted for at fair value as a derivative liability as the Company could not determine if a sufficient number of shares would be available to settle all transactions. | |||||
The fair value of the conversion feature is summarized as follows: | |||||
Derivative liability - December 31, 2013 | 1,147,330 | ||||
Fair value mark to market adjustment for equity instruments | -373,944 | ||||
Conversion instruments exercise | -773,386 | ||||
Derivative liability – June 30, 2014 | $ | - | |||
The Company recorded the day one value of derivative contracts associated with the Series D preferred stock issuance against gross proceeds raised, and expensed immediately the remaining value of the derivative as it exceeded the gross proceeds of the offering. The Company recorded a derivative expense of $0 and $96,913 for the six months ended June 30, 2014 and 2013, respectively. | |||||
On April 2, 2014, the remaining outstanding shares of Series D preferred stock were converted into common shares thereby eliminating the remaining derivative liability for the embedded conversion option as of that date. Of the derivative liability that was eliminated, $773,254 was reclassified to Additional paid-in capital in our Consolidated Balance Sheets. | |||||
Restricted_Stock_Units
Restricted Stock Units | 6 Months Ended |
Jun. 30, 2014 | |
Schedule Of Share Based Compensation Restricted Stock and Restricted Stock Units [Abstract] | ' |
Compensation and Employee Benefit Plans [Text Block] | ' |
Note 8: Restricted Stock Units | |
In November 2012, the Company granted 129,413 restricted stock units to certain executives. Each restricted stock unit represents a contingent right to receive one share of the Company’s common stock upon vesting. The value of this award at the grant date was $449,900 and will be amortized over the vesting periods such that each tranche of restricted stock units will be fully amortized at the date of vesting. The restricted stock units vest as follows: 43,137 on January 1, 2013, 43,138 shares on January 1, 2014, and 43,138 shares on December 1, 2014. As of June 30, 2014, 86,275 restricted stock units have vested and the unamortized portion of this award is $75,600. | |
In June 2013, the Company approved a restricted stock award to certain key employees, officers and directors for 1,550,000 shares. The shares were issued upon the award’s approval with ownership rights conveyed upon vesting. The value of this award at the grant date was $17,065,500. Of these shares, the Company estimates that 1,500,200 shares will fully vest for a total value of $16,517,202. This amount will be amortized over the vesting periods such that each tranche’s estimated shares of restricted stock will be fully amortized at the dates of vesting. The award vests in two tranches with 17% vesting December 31, 2013 and the remaining 83% vesting December 31, 2015 with the exception of certain executives under employment agreements that terminate prior to December 31, 2015. These awards will be amortized over the remaining term of their employment agreements. As of June 30, 2014, 263,500 shares have vested and the unamortized portion of this award is $9,412,449. | |
In December 2013, the Company granted the independent members of the Board of Directors a restricted stock grant of 19,364 shares as part of the annual director’s compensation plan. The awarded shares were issued upon the award’s approval with ownership rights to be conveyed upon vesting. The value of this award at the grant date was $152,000, and will be amortized over the vesting periods. The restricted stock award will vest in three equal tranches on July 1, 2014, July 1, 2015, and July 1, 2016. As of June 30, 2014, no shares have vested and the unamortized portion of the awards was $101,328. | |
On March 17, 2014, the Company granted the independent members of the Board of Directors a restricted stock grant of 48,856 shares as part of the annual director’s compensation plan. The awarded shares were issued upon the award’s approval with ownership rights to be conveyed upon vesting. The value of this award at the grant date was $320,007, and will be amortized over the service period, which is January 1 – December 31, 2014. The restricted stock award will vest in three equal tranches on March 17, 2014, March 17, 2015, and March 17, 2016. As of June 30 2014, 16,284 shares have vested and the unamortized portion of the awards is $160,438. | |
On May 6, 2014, the Company granted restricted stock awards to certain employees under the June 2013 employee stock grant plan and who joined the Company after the initial employee stock awards in June 2013. The awarded shares were issued upon the award’s approval with ownership rights to be conveyed upon vesting. The value of this award on the grant date was $1,137,600, and will amortized over the vesting periods. The restricted award will vest in five equal tranches on December 31, 2014, 2015, 2016, 2017, and 2018. | |
Total compensation expense for these awards recognized during the three months ended June 30, 2014 and 2013 was $2,117,332, and $37,389, respectively. For the six months ended June 30, 2014 and 2013 the total compensation expense for these awards was $4,519,767 and $74,367, respectively, and is included in Operating expenses. | |
Stockholders_Equity
Stockholders' Equity | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | ||||||||||||||||||||
Stockholders' Equity Note Disclosure [Text Block] | ' | ||||||||||||||||||||
Note 9: Stockholders’ Equity | |||||||||||||||||||||
Series D Convertible Preferred Stock | |||||||||||||||||||||
In January 2013 the board of directors authorized 1,600,000 shares of Series D convertible preferred stock. Between January 16, 2013 and February 4, 2013, the Company entered into separate subscription agreements with certain investors in connection with the offering, pursuant to which the Company sold an aggregate of 1,500,000 shares of Preferred Stock for aggregate gross proceeds of approximately $12 million. Pursuant to the Certificate of Designation of the Series D Convertible Preferred Stock filed with the Nevada Secretary of State on January 11, 2013 (the “Certificate of Designation”), each share of Preferred Stock is convertible into two shares of common stock, subject to adjustment as set forth in the Certificate of Designation. On April 2, 2014, the remaining 131,500 shares of outstanding Series D convertible preferred stock were converted to 263,000 shares of common stock. | |||||||||||||||||||||
Common Stock | |||||||||||||||||||||
During the six months ended June 30, 2014, the Company issued the following common stock: | |||||||||||||||||||||
Transaction Type | Quantity | Valuation | Range of Value | ||||||||||||||||||
(#) | ($) | per Share | |||||||||||||||||||
($) | |||||||||||||||||||||
Conversion of Series D preferred stock to common stock | 263,000 | 773,517 | 2.94 | ||||||||||||||||||
Executive/Board of Director compensation | 60,422 | 265,325 | 3.48 – 8.70 | ||||||||||||||||||
Stock issued for Biozone acquisition | 1,200,000 | 9,840,000 | 8.2 | ||||||||||||||||||
Total | 1,523,422 | 10,878,842 | 2.94 – 8.70 | ||||||||||||||||||
The fair value of all stock issuances above is based upon either the quoted closing trading price on the date of issuance or the value of derivative instrument at the date of conversion. See Note 14 for further details of the Biozone acquisition. | |||||||||||||||||||||
Earnings (Loss) Per Share | |||||||||||||||||||||
Basic net earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of common stock outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. | |||||||||||||||||||||
The Company uses the “treasury stock” method to determine whether there is a dilutive effect of outstanding option and warrant contracts. For the three months ended June 30, 2014, and the three and six months ended June 30, 2013 the Company reflected net loss and a dilutive net loss, and the effect of considering any common stock equivalents would have been anti-dilutive for the period. Therefore, separate computation of diluted earnings (loss) per share is not presented for the three months ended June 30, 2014 and the three and six months ended June 30, 2013. | |||||||||||||||||||||
The Company has the following common stock equivalents as of June 30, 2014 and 2013, respectively: | |||||||||||||||||||||
As of June 30, | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Stock options (exercise price – $425/share) | 472 | 670 | |||||||||||||||||||
Warrants (exercise price – $4 /share) | - | 330,000 | |||||||||||||||||||
Warrants (exercise price - $1,275/share) | 89 | 89 | |||||||||||||||||||
Employee and director unvested RSUs | 1,501,573 | 86,275 | |||||||||||||||||||
Total common stock equivalents | 1,502,134 | 417,034 | |||||||||||||||||||
The following is a reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three and six months ended June 30, 2014 and 2013, respectively: | |||||||||||||||||||||
Three months ended | Six months ended | ||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||
As Restated | As Restated | ||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||
Net income (loss) | $ | -934,515 | $ | -2,421,808 | $ | 1,801,719 | $ | -9,783,789 | |||||||||||||
Weighted average number of common shares outstanding | 10,610,022 | 7,226,849 | 10,459,522 | 5,686,323 | |||||||||||||||||
Incremental shares from the assumed exercise of dilutive agreements | - | - | 1,404,360 | - | |||||||||||||||||
Diluted common shares outstanding | 10,610,022 | 7,226,849 | 11,863,882 | 5,686,323 | |||||||||||||||||
Earnings (loss) per shares - basic | $ | -0.09 | $ | -0.34 | $ | 0.17 | $ | -1.72 | |||||||||||||
Earnings (loss) per shares - diluted | $ | -0.09 | $ | -0.34 | $ | 0.15 | $ | -1.72 | |||||||||||||
Stock Options | |||||||||||||||||||||
There was no stock option activity for the three or six months ended June 30, 2014. For the three and six months ended June 30, 2013, the Company had forfeitures of 1,177 options. | |||||||||||||||||||||
Stock Warrants | |||||||||||||||||||||
A summary of warrant activity for the Company for the six months ended June 30, 2014 is as follows: | |||||||||||||||||||||
Number of Warrants | Weighted Average Exercise Price | ||||||||||||||||||||
Outstanding – December 31, 2013 | 263,089 | $ | 4.43 | ||||||||||||||||||
Granted | - | - | |||||||||||||||||||
Exercised | -263,000 | 4 | |||||||||||||||||||
Balance as June 30, 2014 | 89 | $ | 1,275 | ||||||||||||||||||
Warrants Outstanding | Warrants Exercisable | ||||||||||||||||||||
Range of | Number | Weighted Average | Weighted Average | Number | Weighted | Intrinsic Value | |||||||||||||||
Exercise Prices | Outstanding | Remaining | Exercise Price | Exercisable | Average | ||||||||||||||||
Contractual Life (in | Exercise Price | ||||||||||||||||||||
years) | |||||||||||||||||||||
$ | 1,275 | 89 | 1.04 | $ | 1,275 | 89 | $ | 1,275 | - | ||||||||||||
Commitments_Contingencies_and_
Commitments, Contingencies and Other Matters | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||||||
Commitments and Contingencies Disclosure [Text Block] | ' | |||||||||||||||||||
Note 10: Commitments, Contingencies and Other Matters | ||||||||||||||||||||
Operating Leases | ||||||||||||||||||||
The Company leases office and warehouse facilities under operating leases which expire at various dates through 2029. The amounts reflected in the table below are for the aggregate future minimum lease payments under non-cancelable facility operating leases. Under lease agreements that contain escalating rent provisions, lease expense is recorded on a straight-line basis over the lease term. Rent expense for the six months ended June 30, 2014 and 2013 amounted to $632,882 and $298,887, respectively. | ||||||||||||||||||||
As of June 30, 2014, future minimum lease payments are as follows: | ||||||||||||||||||||
Years Ending December 31, | ||||||||||||||||||||
2014 (remaining 6 months) | $ | 618,426 | ||||||||||||||||||
2015 | 1,087,030 | |||||||||||||||||||
2016 | 884,061 | |||||||||||||||||||
2017 | 841,118 | |||||||||||||||||||
2018 | 838,246 | |||||||||||||||||||
Thereafter | 3,519,391 | |||||||||||||||||||
Total minimum lease payments | $ | 7,788,272 | ||||||||||||||||||
Capital Leases | ||||||||||||||||||||
The Company leases manufacturing and warehouse equipment under capital leases which expire at various dates through 2017. As of June 30, 2014, the Company had $233,426 in leased assets classified as Furniture, fixtures, and equipment and Manufacturing and lab equipment under Property and equipment in the Consolidated Balance Sheets. The accumulated depreciation on leased assets as of June 30, 2014 was $14,075. Short term capital lease liabilities of $77,327 are included as a component of current liabilities, and the long-term capital lease liabilities of $116,378 are included as a component of long term liabilities in our Consolidated Balance Sheets. | ||||||||||||||||||||
As of June 30, 2014 and December 31, 2013, the Company had an outstanding balance on capital leases of $193,705 and $81,292, respectively. The amounts reflected in the table below are for the aggregate future minimum lease payments under equipment lease agreements. | ||||||||||||||||||||
As of June 30, 2014, future minimum lease payments are as follows: | ||||||||||||||||||||
Years Ending December 31, | ||||||||||||||||||||
2014 (remaining 6 months) | $ | 45,661 | ||||||||||||||||||
2015 | 91,321 | |||||||||||||||||||
2016 | 79,472 | |||||||||||||||||||
2017 | 5,898 | |||||||||||||||||||
Total minimum lease payments | 222,352 | |||||||||||||||||||
Less amounts representing interest | -28,647 | |||||||||||||||||||
Present value of minimum lease payments | $ | 193,705 | ||||||||||||||||||
Contingencies | ||||||||||||||||||||
For all legal proceedings, at each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. | ||||||||||||||||||||
The Company and its subsidiaries are involved in litigation matters and claims in the normal course of business. In the past, the Company and its subsidiaries have litigated these matters. The Company expects it or its subsidiaries will be involved in legal proceedings in the future. These existing and any future legal actions may harm the Company’s business. Litigation could severely disrupt or shut down the business operations or strategic partners of the Company’s subsidiaries, which in turn would significantly harm ongoing relations with them and cause the Company to lose revenues. The cost associated with legal proceedings are typically high, relatively unpredictable and not completely within the Company’s control. These costs may be materially higher than expected, which could adversely affect the Company’s operating results and lead to volatility in the price of its common stock. Whether or not determined in the Company’s favor or ultimately settled, litigation diverts managerial, technical, legal and financial resources from the Company’s business operations. Furthermore, an adverse decision in any of these legal actions could subject the Company to significant liabilities, lost revenue, negatively impact the Company’s stock price or its business and consolidated financial position, results of operations or cash flows. | ||||||||||||||||||||
Additionally, as a manufacturer of nutritional supplements and other consumer products that are ingested by consumers, the Company may be subject to various product liability claims. Although we have not had any material claims to date, it is possible that current and future product liability claims could have a material adverse effect on our business or financial condition, results of operations or cash flows. The Company currently maintains product liability insurance with a deductible/retention of $10,000 per claim with an aggregate cap on retained loss of $20,000,000. At June 30, 2014 the Company had not recorded any accruals for product liability claims. | ||||||||||||||||||||
See Part II, Item I of Form 10Q for further discussion of legal proceedings that the Company is party to. | ||||||||||||||||||||
Sponsorship and Endorsement Contract Liabilities | ||||||||||||||||||||
The Company has various non-cancelable endorsement and sponsorship agreements with terms expiring through 2018. The total value of outstanding payments as of June 30, 2014 was $37,102,417. The total outstanding payments are as follows: | ||||||||||||||||||||
Outstanding Payments | 2014 | 2015 | 2016 | 2017 | 2018 | Total | ||||||||||||||
Endorsement | $ | 3,730,750 | $ | 8,280,834 | $ | 6,490,833 | $ | 6,600,000 | $ | 3,500,000 | $ | 28,602,417 | ||||||||
Sponsorship | 2,357,500 | 4,905,000 | 1,137,500 | 100,000 | - | 8,500,000 | ||||||||||||||
Total | $ | 6,088,250 | $ | 13,185,834 | $ | 7,628,333 | $ | 6,700,000 | $ | 3,500,000 | $ | 37,102,417 | ||||||||
SEC Investigation | ||||||||||||||||||||
In July 2013, the Company received a formal order of investigation of the Company from the Denver Regional Office of the Securities and Exchange Commission. As a result of that formal order, the Company is conducting a review of its internal controls, disclosures of related party transactions, settlements of claims including share issuance, executive compensation, and disclosure of perquisites for the periods of 2010, 2011, and 2012. There can be no assurance that these are the only subject matters of concern, what the nature or amounts in question will be, or that these are the only periods under review. As of June 30, 2014 and the date of this report, there have been no changes in the status of the investigation. | ||||||||||||||||||||
Defined_Contribution_Plan
Defined Contribution Plan | 6 Months Ended |
Jun. 30, 2014 | |
Compensation and Retirement Disclosure [Abstract] | ' |
Pension and Other Postretirement Benefits Disclosure [Text Block] | ' |
Note 11: Defined Contribution Plan | |
The Company established a 401(k) Plan (the “401(k) Plan”) for eligible employees of the Company. Generally, all employees of the Company who are at least twenty-one years of age and who have completed six months of service are eligible to participate in the 401(k) Plan. The 401(k) Plan is a defined contribution plan that provides that participants may make voluntary salary deferral contributions, on a pretax basis, of up to $17,500 for 2014 (subject to make-up contributions) in the form of voluntary payroll deductions. The Company may make discretionary contributions. During the six months ended June 30, 2014 and 2013 the Company’s matching contribution was $148,745 and $28,530, respectively. | |
Related_Party_Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions Disclosure [Text Block] | ' |
Note 12: Related Party Transactions | |
Ryan DeLuca, the Chief Executive Officer of Bodybuilding.com, is the brother of Jeremy DeLuca, MusclePharm’s EVP, MusclePharm Brand and Global Business Development. The Company maintained a business relationship with Bodybuilding.com prior to hiring Mr. DeLuca. The Company does not offer preferential pricing of our products to Bodybuilding.com based on these relationships. Sales of products to Bodybuilding.com were $7,276,542 and $6,933,056, respectively, for the three months ended June 30, 2014 and 2013; and $15,499,998 and $14,953,845 for the six months ended June 30, 2014 and 2013, respectively. Bodybuilding.com owed the Company approximately $1,720,719 and $2,051,265 in trade receivables as of June 30, 2014 and December 31, 2013, respectively. The Company purchased marketing services from Bodybuilding.com during the three and six months ended June 30, 2014 in the amount of $338,877 and $688,885, respectively. | |
The Company leases our office and warehouse facility in Hamilton, Ontario, Canada from 2017275 Ontario Inc., which is a company owned by Renzo Passaretti, VP and General Manager of MusclePharm Canada Enterprises Corp, our wholly owned Canadian subsidiary. For the three and six months ended June 30, 2014 we paid rent of $22,951 and $41,015, respectively, and for the three and six months ended June 30, 2013, we paid rent of $19,211 and $38,713, respectively. The lease expires March 31, 2016. | |
On October 16, 2013, the Company entered into an Office Lease Agreement with Frost Real Estate Holdings, LLC, a Florida limited liability company owned by Dr. Phillip Frost, one of our significant shareholders. Pursuant to the lease, the Company rents 1,437 square feet of office space for an initial term of three years, with an option to renew the lease for an additional three year term. For the three and six months ended June 30, 2014, we paid rent of $15,438 and $26,828, respectively. | |
During the six months ended June 30, 2014, the Company purchased split dollar life insurance policies on certain key executives. These policies provide a split of 50% of the death benefit proceeds to the Company and 50% to the officer’s designated beneficiaries. | |
Endorsement_Agreement
Endorsement Agreement | 6 Months Ended |
Jun. 30, 2014 | |
Endorsement Agreement [Abstract] | ' |
Endorsement Agreement [Text Block] | ' |
Note 13: Endorsement Agreement | |
On July 26, 2013, the Company entered into an Endorsement Licensing and Co-Branding Agreement by and among, the Company, Arnold Schwarzenegger, Marine MP, LLC, and Fitness Publications, Inc. Under the terms of the Agreement, Mr. Arnold Schwarzenegger will co-develop a special Arnold Schwarzenegger product line and will be co-marketed under Mr. Schwarzenegger’s name and likeness. | |
In connection with this agreement, the Company also issued Marine MP, LLC fully vested restricted shares of common stock. As of June 30, 2014 and December 31, 2013, the amount of unamortized stock compensation expense related to this agreement was $5,889,000 and $7,300,800, respectively. The shares are being amortized over the original three year term of the agreement. The current and non-current portions of this unamortized stock compensation are included as a component of Prepaid Stock Compensation in the Consolidated Balance Sheets. | |
Biozone_Acquisition
Biozone Acquisition | 6 Months Ended | |||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||
Business Combinations [Abstract] | ' | |||||||||||||||||
Business Combination Disclosure [Text Block] | ' | |||||||||||||||||
Note 14: Biozone Acquisition | ||||||||||||||||||
On January 2, 2014, the Company completed its acquisition of BioZone Pharmaceuticals, Inc. (“BioZone”) for $9,840,000 in MusclePharm common stock. | ||||||||||||||||||
The base purchase price under the asset purchase agreement was 1.2 million shares of the Company’s common stock of which 600,000 shares were placed into escrow for a period of nine months to cover indemnification obligations and which shares are also subject to repurchase from the escrow for $10.00 per share in cash during the nine-month escrow period. The remaining 600,000 non-escrowed shares were issued to Biozone upon closing and are subject to a lockup agreement which permits private sales (subject to the lockup and certain leak out provisions). The total consideration was $9,840,000 in common stock based on the stock price as of January 2, 2014. As of June 30, 2014 and the date of this report, the Company is still evaluating the extent to which there will be adjustments against the purchase price of the Biozone assets and liabilities as a result of certain claims that the Company may assert against Biozone pursuant to the indemnification provision under the APA and the 580 Garcia Lease indemnity agreement. | ||||||||||||||||||
The Biozone acquisition is considered an acquisition of a business and was accounted for in accordance with accounting guidance for business combinations. The acquired assets and liabilities have been recognized at their estimated fair value, and the purchase price has been allocated to the tangible and intangible assets acquired and liabilities assumed. MusclePharm contracted a third party valuation firm to determine the fair value at the date of purchase of all identifiable tangible and intangible assets purchased in the acquisition. Based upon the fair values acquired, the purchase price allocation is as follows: | ||||||||||||||||||
Purchase Price Allocation | ||||||||||||||||||
Net Tangible Assets | ||||||||||||||||||
Property & equipment | $ | 1,859,066 | ||||||||||||||||
Receivables | 806,212 | |||||||||||||||||
Inventory | 840,999 | |||||||||||||||||
Other assets | 577,453 | |||||||||||||||||
Factoring payable | -795,031 | |||||||||||||||||
Trade payables | -327,038 | |||||||||||||||||
Equipment leases | -122,766 | |||||||||||||||||
Employee compensation liability | -78,134 | |||||||||||||||||
Other liabilities | -76,423 | |||||||||||||||||
Total net tangible assets acquired | 2,684,338 | |||||||||||||||||
Identified Intangible Assets | ||||||||||||||||||
Patents | $ | 5,869,874 | ||||||||||||||||
Trademarks | 656,160 | |||||||||||||||||
Customer lists | 629,607 | |||||||||||||||||
Domain name | 21 | |||||||||||||||||
Total identified intangible assets acquired | 7,155,662 | |||||||||||||||||
Total purchase price | $ | 9,840,000 | ||||||||||||||||
Receivables | ||||||||||||||||||
The Company acquired various receivables as part of the asset acquisition of Biozone. The table below reflects the estimated fair value and the contractual value of the receivables as of the transaction date. As of the date of the acquisition the Company determined that none of the receivables were uncollectible. | ||||||||||||||||||
Receivables | Estimated Fair | Contractual | ||||||||||||||||
Value | Value | |||||||||||||||||
Trade receivables | $ | 806,212 | $ | 807,294 | ||||||||||||||
Factoring receivable | 150,702 | 151,016 | ||||||||||||||||
Asset sale receivable | 399,814 | 400,000 | ||||||||||||||||
Unaudited Pro Forma Income Statement | ||||||||||||||||||
The accompanying consolidated statements of operations include the results of the Biozone Acquisition from the acquisition date of January 2, 2014. The Company has determined that there were no significant transactions during the one day which is not presented in the accompanying consolidated statement of operations for the six months ended June 30, 2014 and has therefore not presented the pro forma effects of the acquisition for this period. The unaudited pro forma effects of the acquisition on the results of operations as if the acquisition had been completed on January 1, 2013 for the three and six months ended June 30, 2013 is as follows: | ||||||||||||||||||
Three Months Ended June 30, 2013 | ||||||||||||||||||
Combined | ||||||||||||||||||
BioZone | Before Pro | MusclePharm | ||||||||||||||||
MusclePharm | Pharmaceuticals | Forma | Pro Forma | Corp. | ||||||||||||||
Corp. | Inc. | Adjustments | Adjustments | Pro Forma | ||||||||||||||
Sales - net | $ | 25,480,059 | $ | 1,801,600 | $ | 27,281,659 | $ | - | $ | 27,281,659 | ||||||||
Net loss | -2,421,808 | -708,484 | -3,130,292 | -119,093 | (a) | -3,249,385 | ||||||||||||
Net loss per share – basic and diluted | $ | -0.34 | - | - | - | $ | -0.45 | |||||||||||
Weighted average number of common shares used in per share calculations – basic and diluted | 7,226,849 | - | - | - | 7,226,849 | |||||||||||||
Six Months Ended June 30, 2013 | ||||||||||||||||||
Combined | ||||||||||||||||||
BioZone | Before Pro | MusclePharm | ||||||||||||||||
MusclePharm | Pharmaceuticals | Forma | Pro Forma | Corp. | ||||||||||||||
Corp. | Inc. | Adjustments | Adjustments | Pro Forma | ||||||||||||||
Sales - net | $ | 48,041,226 | $ | 3,677,131 | $ | 51,718,357 | $ | - | $ | 51,718,357 | ||||||||
Net loss | -9,783,789 | -1,820,351 | -11,604,140 | -247,400 | (a) | -11,851,540 | ||||||||||||
Net loss per share – basic and diluted | $ | -1.72 | - | - | - | $ | -2.08 | |||||||||||
Weighted average number of common shares used in per share calculations – basic and diluted | 5,686,323 | - | - | - | 5,686,323 | |||||||||||||
(a) | Pro forma adjustment to eliminate historical seller depreciation expense and record depreciation and amortization expense resulting from the assets acquired. | |||||||||||||||||
The above unaudited pro forma results include adjustments for depreciation of property and equipment and amortization of acquired intangible assets. The unaudited pro forma information as presented above is for informational purposes only and is not necessarily indicative of results of operations that would have been achieved if the acquisition had taken place at the date identified. | ||||||||||||||||||
Intangible_Assets
Intangible Assets | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||
Intangible Assets Disclosure [Text Block] | ' | |||||||||||||
Note 15: Intangible Assets | ||||||||||||||
Intangible assets consist of the following: | ||||||||||||||
As of June 30, 2014 | ||||||||||||||
Gross Assets | Accumulated | Net Assets | Weighted | |||||||||||
Amortization | average | |||||||||||||
amortization | ||||||||||||||
period (years) | ||||||||||||||
Amortized intangible assets | ||||||||||||||
Patents | $ | 5,922,374 | $ | -456,547 | $ | 5,465,827 | 8.25 | |||||||
Trademarks | 691,160 | -69,281 | 621,879 | 7.02 | ||||||||||
Customer relationships | 629,607 | -52,467 | 577,140 | 5.51 | ||||||||||
7,243,141 | -578,295 | 6,664,846 | ||||||||||||
Indefinite lived intangible assets | ||||||||||||||
Domain name | 67,686 | - | 67,686 | - | ||||||||||
67,686 | - | 67,686 | ||||||||||||
Total intangible assets | $ | 7,310,827 | $ | -578,295 | $ | 6,732,532 | ||||||||
Amortization expense for the three months ended June 30, 2014 and 2013 was $293,113 and zero, respectively, and for the six months ended June 30, 2014 and 2013 was $578,295 and zero, respectively. Amortization expense is included in Operating expenses in the Consolidated Statement of Operations. | ||||||||||||||
As of June 30, 2014, the estimated future amortization expense of intangible assets is as follows: | ||||||||||||||
2014 (remaining 6 months) | $ | 550,097 | ||||||||||||
2015 | 1,106,314 | |||||||||||||
2016 | 999,955 | |||||||||||||
2017 | 926,090 | |||||||||||||
2018 | 902,187 | |||||||||||||
Thereafter | 2,180,203 | |||||||||||||
Total amortization expense | $ | 6,664,846 | ||||||||||||
Restatement_of_June_30_2014_Un
Restatement of June 30, 2014 Unaudited Consolidated Financial Statements | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Accounting Changes and Error Corrections [Abstract] | ' | |||||||
Accounting Changes and Error Corrections [Text Block] | ' | |||||||
Note 16: Restatement of June 30, 2014 Unaudited Consolidated Financial Statements | ||||||||
The unaudited consolidated balance sheet as of June 30, 2014 and unaudited consolidated statement of operations for the three months and six months ended June 30, 2014 as presented herein, have been restated from what was previously reported in the Company’s Form 10-Q for the quarterly period ended June 30, 2014 to correct for the recognition of a receivable of insurance reimbursement in relation to the SEC investigation. The Company has insurance coverage for the reimbursement of legal fees and expenses incurred by the Company in the course of complying with the ongoing SEC investigation as more fully described in Note 10. The Company estimated it would be eligible for reimbursement of these legal expenses under the insurance policies. Subsequent to the filing of Form 10-Q on August 4, 2014, the Company determined the previously mentioned insurance claim was not validated by the insurance carrier. The Company has been in ongoing discussions with the insurance carrier and specialized legal counsel regarding the requirements to validate the claim. As a result, the timing of collection of the insurance claim is unclear and the Company has reversed the other receivable of $1,342,843 previously recognized in the second quarter. The receivable balance consisted of fees and expenses incurred from January 1, 2014 through June 30, 2014 related to the SEC investigation. Of these fees and expenses, $358,671 and $984,172 was incurred in the first and second quarters of 2014, respectively. For the three and six months ended June 30, 2014, professional fees have been restated to be $1,292,517 and $2,077,090, respectively. The Company is continuing to pursue recovery of legal fees and expenses previously incurred and future related expenses. The total amounts incurred for the year ended December 31, 2013 and the six months ended June 30, 2014 is $1,168,838 and $1,342,843, respectively, or a total of $2,511,681. | ||||||||
The unaudited consolidated balance sheet as of June 30, 2014 as presented herein is restated to remove the other receivable in the amount of $1,342,843 from the current assets as of June 30, 2014. | ||||||||
The following sets forth summarized unaudited consolidated balance sheet information on the effects of the restatements: | ||||||||
As of June 30, 2014 | ||||||||
As Previously | As | |||||||
Reported | Restated | |||||||
Current assets | $ | 50,547,702 | $ | 49,204,859 | ||||
Property and equipment - net | 6,221,261 | 6,221,261 | ||||||
Intangible assets - net | 6,732,532 | 6,732,532 | ||||||
Prepaid stock compensation | 3,251,791 | 3,251,791 | ||||||
Other assets | 179,632 | 179,632 | ||||||
$ | 66,932,918 | $ | 65,590,075 | |||||
Current liabilities | 28,473,117 | 28,473,117 | ||||||
Other long-term liabilities | 366,378 | 366,378 | ||||||
Stockholders' equity | 38,093,423 | 36,750,580 | ||||||
$ | 66,932,918 | $ | 65,590,075 | |||||
The following sets forth summarized unaudited consolidated statement of operations information on the effects of the restatements: | ||||||||
For the Six Months Ended | ||||||||
June 30, 2014 | ||||||||
As Previously | As | |||||||
Reported | Restated | |||||||
Sales - net | $ | 96,949,441 | $ | 96,949,441 | ||||
Cost of sales | 63,429,609 | 63,429,609 | ||||||
Gross profit | 33,519,832 | 33,519,832 | ||||||
Operating expenses | 30,616,428 | 31,959,271 | ||||||
Operating income | 2,903,404 | 1,560,561 | ||||||
Other income (expense) | 318,105 | 318,105 | ||||||
Net income before taxes | 3,221,509 | 1,878,666 | ||||||
Provision for income taxes | -76,947 | -76,947 | ||||||
Net income | 3,144,562 | 1,801,719 | ||||||
Other comprehensive income (expense) | 18,707 | 18,707 | ||||||
Total other comprehensive income | $ | 3,163,269 | $ | 1,820,426 | ||||
Earnings (loss) per share | ||||||||
Net income per common share | ||||||||
Basic | $ | 0.3 | $ | 0.17 | ||||
Diluted | $ | 0.27 | $ | 0.15 | ||||
Weighted average number of shares used in per share calculations - Basic | 10,459,522 | 10,459,522 | ||||||
Weighted average number of shares used in per share calculations - Diluted | 11,863,882 | 11,863,882 | ||||||
For the Three Months Ended | ||||||||
June 30, 2014 | ||||||||
As Previously | As | |||||||
Reported | Restated | |||||||
Sales - net | $ | 46,739,987 | $ | 46,739,987 | ||||
Cost of sales | 31,093,224 | 31,093,224 | ||||||
Gross profit | 15,646,763 | 15,646,763 | ||||||
Operating expenses | 15,167,248 | 16,510,091 | ||||||
Operating income | 479,515 | -863,328 | ||||||
Other income (expense) | -26,401 | -26,401 | ||||||
Net income (loss) before taxes | 453,114 | -889,729 | ||||||
Provision for income taxes | -44,786 | -44,786 | ||||||
Net income (loss) | 408,328 | -934,515 | ||||||
Other comprehensive income (expense) | 22,954 | 22,954 | ||||||
Total other comprehensive income (loss) | $ | 431,282 | $ | -911,561 | ||||
Earnings (loss) per share | ||||||||
Net income per common share | ||||||||
Basic | $ | 0.04 | $ | -0.09 | ||||
Diluted | $ | 0.03 | $ | -0.09 | ||||
Weighted average number of shares used in per share calculations - Basic | 10,610,022 | 10,610,022 | ||||||
Weighted average number of shares used in per share calculations - Diluted | 12,064,122 | 10,610,022 | ||||||
Subsequent_Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events [Text Block] | ' |
Note 17: Subsequent Events | |
Tiger Woods Endorsement Agreement | |
Effective July 1, 2014, the Company entered into an Endorsement Agreement (the “Agreement”) with ETW Corp. Under the terms of the Agreement, Tiger Woods will endorse certain of the Company’s products and use a golf bag during all professional golf play which prominently displays the MusclePharm name and logo. | |
In conjunction with this agreement, on July 3, 2014 (“Issuance Date”), the Company issued 446,853 shares of the Company’s restricted common stock to ETW Corp with an aggregate market value of $5,000,000. | |
Jonathan Manziel Endorsement Agreement | |
Effective July 15, 2014, the Company entered into an Endorsement Agreement (the “Manziel Agreement”) with JMAN2 General III, LP for the services of Jonathan Manziel. Under the terms of the Manziel Agreement, Mr. Manziel will be available to use, evaluate, promote, and advertise MusclePharm products. | |
In conjunction with the Manziel Agreement, the Company issued to JMAN2 General III, LP warrants to purchase 100,000 shares of MusclePharm common stock at an exercise price of $11.90 per share. These warrants vest ratably over a period of 24 months beginning August 15, 2014. | |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 6 Months Ended | ||
Jun. 30, 2014 | |||
Accounting Policies [Abstract] | ' | ||
Consolidation, Policy [Policy Text Block] | ' | ||
Principles of Consolidation | |||
The consolidated financial statements include the accounts of MusclePharm Corporation and its wholly-owned subsidiaries MusclePharm Canada Enterprises Corp (“MusclePharm Canada”) and Biozone Laboratories, Inc. (“Biozone”). MusclePharm Canada began operations in April 2012 and Biozone was acquired in January 2014. All intercompany accounts and transactions have been eliminated upon consolidation | |||
Use of Estimates, Policy [Policy Text Block] | ' | ||
Use of Estimates | |||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The accounting estimates and assumptions that require management’s most significant, difficult, and subjective judgment include the recognition and measurement of allowance for doubtful accounts, inventory reserve, derivatives, and sales discounts and allowances reserve among others. Actual results experienced by the Company may differ from management’s estimates. | |||
Risks and Uncertainties [Policy Text Block] | ' | ||
Risks and Uncertainties | |||
The Company operates in an industry that is subject to rapid change and intense competition. The Company’s operations will be subject to significant risk and uncertainties including financial, operational, technological, regulatory, industry adverse publicity and other risks, including the potential risk of business failure. | |||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | ||
Recent Accounting Pronouncements | |||
In May 2014, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for revenue recognition. The amendments are based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. MusclePharm is required to adopt the amendments in the first quarter of 2017. Early adoption is not permitted. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. MusclePharm is currently evaluating the impact of these amendments and the transition alternatives on its Consolidated Financial Statements | |||
Cash and Cash Equivalents, Policy [Policy Text Block] | ' | ||
Cash and Cash Equivalents | |||
The Company considers all highly liquid instruments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. At June 30, 2014 and December 31, 2013, respectively, the Company had no cash equivalents. | |||
The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The cash balance at times may exceed federally insured limits, and at June 30, 2014 we had one bank account that exceeded the federally insured limit, and at December 31, 2013 we had two bank accounts that exceeded the federally insured limit. | |||
Accounts Receivable and Allowance For Doubtful Accounts [Policy Text Block] | ' | ||
Accounts Receivable and Allowance for Doubtful Accounts | |||
Accounts receivable represents trade obligations from customers that are subject to normal trade collection terms. The Company’s finance department monitors the status of customer receivables and takes actions to collect past due balances as necessary. The Company periodically evaluates the collectability of its accounts receivable and considers the need to establish an allowance for doubtful accounts based upon historical collection experience and specific customer information. Accordingly, the actual amounts could vary from the recorded allowances. There is also a review of customer discounts at the period end and an accrual made for discounts earned but not yet utilized by period end. | |||
Management performs ongoing evaluations of the Company’s customers’ financial condition and generally does not require collateral. Some international customers are required to pay for their orders in advance of shipment. Management reviews accounts receivable quarterly and reduces the carrying amount by a valuation allowance that reflects management’s best estimate of amounts that may not be collectible. Allowances, if any, for uncollectible accounts receivable are determined based upon the aging of accounts receivable, changes in customer credit worthiness, general market and economic conditions, and historical experience. Bad debt expense recognized as a result of our valuation allowance is classified under Selling, general and administrative expense in the Consolidated Statement of Operations. | |||
The Company does not charge interest on past due receivables. Receivables are determined to be past due based on the payment terms of the original invoices. | |||
Inventory, Policy [Policy Text Block] | ' | ||
Inventory | |||
Inventory is valued at the lower of cost or market value. The cost of product inventory for MusclePharm and MusclePharm Canada is computed using actual cost on a First-In First-Out basis, and the cost of inventory for Biozone is computed using an average cost basis. Adjustments to reduce the cost of inventory to its net realizable value are made, if required, and estimates are made for obsolescence, excess or slow-moving inventories, non-conforming inventories, and expired inventory. | |||
Prepaid Giveways [Policy Text Block] | ' | ||
Prepaid Giveaways | |||
Prepaid giveaways represent non-inventory samples, which are given away to aid in promotion of the brand and products. | |||
Prepaid Sponsorship Fees [Policy Text Block] | ' | ||
Prepaid Sponsorship and Endorsement Fees | |||
Prepaid sponsorship and endorsement fees represent fees paid in connection with Company sponsorships of certain events and trade shows as well as prepaid athlete endorsement fees, which are expensed over the period the fees are earned. A significant amount of the Company’s promotional expenses results from payments under endorsement and sponsorship contracts. Accounting treatment for endorsement and sponsorship payments is based upon specific contract provisions. Generally, endorsement and sponsorship payments are expensed straight-line over the term of the contract after giving recognition to periodic performance compliance provisions of the contract. Prepayments made under the contracts are included in either current or long-term prepaid expenses depending on the performance period for which the prepayment applies. | |||
Compensation Related Costs, Policy [Policy Text Block] | ' | ||
Prepaid Stock Compensation | |||
Prepaid stock compensation represents amounts paid with stock for future contractual benefits to be received. The Company amortizes these contractual benefits over the life of the contracts using the straight-line method. | |||
Prepaid Expenses [Policy Text Block] | ' | ||
Prepaid Expenses | |||
Prepaid expenses consist of various payments that the Company has made in advance for goods or services to be received in the future. These prepaid expenses include legal retainers, print advertising, insurance and service contracts requiring up-front payments. | |||
Property, Plant and Equipment, Policy [Policy Text Block] | ' | ||
Property and Equipment | |||
Property and equipment are stated at cost and depreciated to their estimated residual value over their estimated useful lives. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation are relieved from the accounts and the resulting gains or losses are included in the Statements of Operations. Repairs and maintenance costs are expensed as incurred. Depreciation is provided using the straight-line method for all property and equipment. We review our property and equipment for impairment when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. We use an estimate of future undiscounted net cash flows of the related assets or groups of assets over their remaining lives in measuring whether the assets are recoverable. An impairment loss is calculated by determining the difference between the carrying values and the estimated fair values of these assets. We did not consider any of our property and equipment to be impaired during the six months ended June 30, 2014 or 2013. | |||
Goodwill and Intangible Assets, Policy [Policy Text Block] | ' | ||
Intangible Assets | |||
Definite-lived intangible assets are amortized over their related useful lives, using a straight-line basis consistent with the underlying expected future cash flows related to the specific intangible asset. Intangible assets are reviewed for impairment whenever events or changes in circumstances exist that indicate the carrying amount of an asset may not be recoverable. When indicators of impairment exist, an estimate of undiscounted net cash flows is used in measuring whether the carrying amount of the asset or related asset group is recoverable. Measurement of the amount of impairment, if any, is based upon the difference between the asset's carrying value and estimated fair value. Fair value is determined through various valuation techniques, including market and income approaches as considered necessary. See Note 15 for further disclosure of intangible assets. | |||
Accrued Liabilities [Policy Text Block] | ' | ||
Accrued Liabilities | |||
Accrued liabilities consist of amounts estimated by management for future liability payments that relate to the current accounting period. Management reviews these estimates periodically to determine their reasonableness and fair presentation | |||
Debt, Policy [Policy Text Block] | ' | ||
Debt | |||
The Company defines short term debt as any debt payment due less than one year from the date of the financial statements. Long term debt is defined as any debt payment due more than one year from the date of the financial statements. Refer to Note 6 for further disclosure of debt liabilities | |||
Derivatives, Policy [Policy Text Block] | ' | ||
Derivatives | |||
Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in equity instruments and warrants granted, and measurement of their fair value. In determining the appropriate fair value, the Company uses Black-Scholes or lattice option-valuation models. In assessing the convertible equity instruments, management determines if the convertible equity instrument is conventional convertible equity and further if the beneficial conversion feature requires separate measurement. | |||
Once derivative instruments are determined, they are adjusted to reflect fair value at the end of each reporting period. Any increase or decrease in the fair value is recorded in results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using a Black-Scholes or lattice option-pricing model. Once a derivative liability ceases to exist any remaining fair value is reclassified to additional paid-in capital if redeemed or through earnings if forfeited or expired. | |||
Fair Value of Financial Instruments, Policy [Policy Text Block] | ' | ||
Fair Value of Financial Instruments | |||
The Company measures assets and liabilities at fair value based on an expected exit price which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. | |||
The following are the hierarchical levels of inputs to measure fair value: | |||
· | Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. | ||
· | Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. | ||
· | Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. | ||
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. | |||
The Company’s financial instruments consisted primarily of accounts receivable, accounts payable, accrued liabilities, and notes payable. The Company’s notes payable approximate fair value based upon current borrowing rates available to the Company for debt with similar maturities. The carrying amounts of the Company’s financial instruments generally approximated their fair values as of June 30, 2014 and December 31, 2013, respectively, due to the short-term nature of these instruments. | |||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | ' | ||
Stock-Based Compensation | |||
Generally, all forms of stock-based compensation, including stock option grants, warrants and restricted stock grants and stock appreciation rights are measured at their fair value on the awards’ grant date, based on estimated number of awards that are ultimately expected to vest. Share-based compensation awards issued to non- employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the stock-based compensation, whichever is more readily determinable | |||
Revenue Recognition Accounting Policy, Gross and Net Revenue Disclosure [Policy Text Block] | ' | ||
Revenue Recognition | |||
The Company derives revenue primarily from sale of products. The Company records revenue when all of the following have occurred: (1) persuasive evidence of an arrangement exists, (2) product has been shipped or delivered, (3) the sales price to the customer is fixed or determinable, and (4) collectability is reasonably assured. | |||
Depending on individual customer agreements, sales are recognized either upon shipment of products to customers or upon delivery. For all Canadian sales, which represent 3% of total sales, recognition occurs upon shipment. | |||
The Company records sales allowances and discounts as a direct reduction of sales. The Company grants volume incentive rebates to certain customers based on contractually agreed upon percentages once certain thresholds have been met. These volume incentive rebates are recorded as a direct reduction to sales. | |||
The Company has determined that customer advertising related credits are accounted for based on the guidance of ASC No. 605-50-55 (“Revenue Recognition” – Customer Payments and Incentives), which indicates that, absent evidence of benefit to the vendor, appropriate treatment requires netting these types of payments against revenues and not expensing as advertising expense. | |||
Advertising Costs, Policy [Policy Text Block] | ' | ||
Advertising and Promotion | |||
Advertising and promotion expenses include digital and print advertising, trade show events, athletic endorsements and sponsorships, and promotional giveaways. Advertising expenses are recognized in the month that the advertising appears while costs associated with trade show events are expensed when the event occurs. For major trade shows, the expenses are recognized within the calendar year over the period in which we recognize revenue associated with sales generated at the trade show. Costs related to promotional giveaways are expensed when the product is either given out at a promotional event or shipped to the customer. | |||
A significant amount of the Company’s promotional expenses results from payments under endorsement and sponsorship contracts. Accounting treatment for endorsement and sponsorship payments is based upon specific contract provisions. Generally, endorsement payments are expensed straight-line over the term of the contract after giving recognition to periodic performance compliance provisions of the contract. Prepayments made under the contracts are included in either current or long-term prepaid expenses depending on the period for which the prepayment applies. | |||
Some of the contracts provide for contingent payments to endorsers or athletes based upon specific achievement in their sports (e.g. winning a championship). The Company records expense for these payments when the endorser achieves the specific achievement. | |||
Income Tax, Policy [Policy Text Block] | ' | ||
Income Taxes | |||
Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Beginning with the adoption of Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes, (included in FASB ASC Subtopic 740-10, Income Taxes — Overall), the Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely to be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. | |||
The Company records interest and penalties related to unrecognized tax benefits in income tax expense. There were no interest or penalties related to unrecognized tax benefits for the three and six months ended June 30, 2014 and 2013. | |||
Foreign Currency Transactions and Translations Policy [Policy Text Block] | ' | ||
Foreign Currency | |||
MusclePharm began operations in Canada in April 2012. The Canadian Dollar was determined to be the functional currency as the majority of the transactions related to the day to day operations of the business are in Canadian Dollars. At the end of the period, the financial results of the Canadian operation are translated into the U.S. Dollar, which is the reporting currency, and added to the U.S. operations for consolidated company financial results. The revenue and expense items are translated using the average rate for the month and the assets and liabilities at the month end of rate. Transactions that have completed the accounting cycle and resulted in a gain or loss related to translation are recorded in realized gain or loss due to foreign currency translation under other income and expense on the income statement. Transactions that have not completed their accounting cycle but appear to have gain or loss due to the translation process are recorded as unrealized gain or loss due to translation and recorded as Accumulated other comprehensive income (loss) in the equity section on the balance sheet until such date the accounting cycle of the transaction is complete and the actual realized gain or loss is recognized. | |||
Concentrations_Tables
Concentrations (Tables) | 6 Months Ended | ||||||||
Jun. 30, 2014 | |||||||||
Accounts Receivable [Member] | ' | ||||||||
Concentration Risk [Line Items] | ' | ||||||||
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | ' | ||||||||
At June 30, 2014 and December 31, 2013, the Company had the following concentrations of accounts receivable with significant customers: | |||||||||
Customer | As of June 30, 2014 | As of December 31, 2013 | |||||||
A | 10 | % | 16 | % | |||||
B | 10 | % | * | % | |||||
C | * | % | 24 | % | |||||
Bodybuilding.com | * | % | 14 | % | |||||
* Less than 10% of total accounts receivable | |||||||||
Sales Revenue, Net [Member] | ' | ||||||||
Concentration Risk [Line Items] | ' | ||||||||
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | ' | ||||||||
The Company had the following concentrations of revenues with significant customers: | |||||||||
Three Months Ended June 30, | |||||||||
Customer | 2014 | 2013 | |||||||
Bodybuilding.com | 15 | % | 25 | % | |||||
B | 10 | % | * | % | |||||
C | * | % | 11 | % | |||||
Six Months Ended June 30, | |||||||||
Customer | 2014 | 2013 | |||||||
Bodybuilding.com | 15 | % | 29 | % | |||||
B | 10 | % | 11 | % | |||||
C | * | % | * | % | |||||
* Less than 10% of gross sales | |||||||||
Cost of Goods, Total [Member] | ' | ||||||||
Concentration Risk [Line Items] | ' | ||||||||
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | ' | ||||||||
The Company had the following concentration of purchases from product vendors: | |||||||||
Three Months Ended June 30, | |||||||||
Vendor | 2014 | 2013 | |||||||
A | 47 | % | 70 | % | |||||
B | 50 | % | 30 | % | |||||
Six Months Ended June 30, | |||||||||
Vendor | 2014 | 2013 | |||||||
A | 50 | % | 82 | % | |||||
B | 47 | % | 18 | % | |||||
Composition_of_Certain_Financi1
Composition of Certain Financial Statement Captions (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
Composition of Certain Financial Statement Captions Abstract [Abstract] | ' | ||||||||||||||||
Schedule Of Accounts Receivable [Table Text Block] | ' | ||||||||||||||||
Accounts receivable, net of allowance consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Accounts receivable | $ | 19,849,929 | $ | 14,830,487 | |||||||||||||
Less: allowance for discounts | -511,066 | -1,060,000 | |||||||||||||||
Less: allowance for doubtful accounts | -141,319 | -29,307 | |||||||||||||||
Accounts receivable – net | $ | 19,197,544 | $ | 13,741,180 | |||||||||||||
Schedule of Inventory, Current [Table Text Block] | ' | ||||||||||||||||
Inventory, net consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Raw materials inventory | $ | 970,538 | $ | - | |||||||||||||
Work in process inventory | 170,843 | - | |||||||||||||||
Finished goods inventory | 18,756,934 | 16,001,515 | |||||||||||||||
Inventory reserve | -128,959 | -229,147 | |||||||||||||||
Total inventory - net | $ | 19,769,356 | $ | 15,772,368 | |||||||||||||
Schedule of Prepaid Expense Current [Table Text Block] | ' | ||||||||||||||||
Prepaid expenses consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Prepaid advertising and promotion | $ | 700,707 | $ | 760,740 | |||||||||||||
Prepaid inventory | 385,679 | - | |||||||||||||||
Prepaid insurance | 263,632 | 280,878 | |||||||||||||||
Prepaid professional services | 226,120 | 74,730 | |||||||||||||||
Prepaid director fees | 116,000 | - | |||||||||||||||
Prepaid research & development fees | 84,221 | 22,500 | |||||||||||||||
Prepaid license fees | 77,141 | 90,623 | |||||||||||||||
Prepaid software license fees | 40,743 | 86,205 | |||||||||||||||
Prepaid support agreements | 36,697 | 3,499 | |||||||||||||||
Prepaid – other | 58,657 | 16,043 | |||||||||||||||
$ | 1,989,597 | $ | 1,335,218 | ||||||||||||||
Schedule of Other Current Assets [Table Text Block] | ' | ||||||||||||||||
Other current assets consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Vendor rebate receivable | $ | 119,467 | $ | - | |||||||||||||
Other receivable from Cocrystal Pharma, Inc. | 209,396 | - | |||||||||||||||
Other current assets | 4,377 | 40,805 | |||||||||||||||
$ | 333,240 | $ | 40,805 | ||||||||||||||
Property, Plant and Equipment [Table Text Block] | ' | ||||||||||||||||
Property and equipment consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of June 30, 2014 | As of December 31, 2013 | Estimated Useful Life | |||||||||||||||
Furniture, fixtures and equipment | $ | 3,173,284 | $ | 1,849,462 | From 3 to 5 years | ||||||||||||
Leasehold improvements | 2,189,963 | 619,159 | From 20 to 182 months | ||||||||||||||
Manufacturing and lab equipment | 1,231,251 | - | From 2 to 20 years | ||||||||||||||
Vehicles | 444,065 | 442,300 | From 2 to 5 years | ||||||||||||||
Displays | 33,683 | 33,683 | 5 years | ||||||||||||||
Website | 15,975 | 11,462 | 3 years | ||||||||||||||
Construction in process | 1,128,588 | 1,018,509 | |||||||||||||||
Total | 8,216,809 | 3,974,575 | |||||||||||||||
Less: Accumulated depreciation and amortization | -1,995,548 | -1,360,991 | |||||||||||||||
$ | 6,221,261 | $ | 2,613,584 | ||||||||||||||
Schedule of Other Assets [Table Text Block] | ' | ||||||||||||||||
Other assets consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Security deposit | $ | 108,394 | $ | 85,419 | |||||||||||||
Long-term portion of prepaid assets | 71,238 | 58,810 | |||||||||||||||
$ | 179,632 | $ | 144,229 | ||||||||||||||
Schedule of Accrued Liabilities [Table Text Block] | ' | ||||||||||||||||
Accrued liabilities consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Accrued payables | $ | 2,606,779 | $ | 487,415 | |||||||||||||
Employee compensation and benefits | 1,717,265 | 1,137,681 | |||||||||||||||
Capital leases | 77,327 | 26,653 | |||||||||||||||
Customer deposits | 67,747 | 265,652 | |||||||||||||||
Accrued taxes | 25,832 | 71,771 | |||||||||||||||
Other | 32,135 | 63,929 | |||||||||||||||
$ | 4,527,085 | $ | 2,053,101 | ||||||||||||||
Other Noncurrent Liabilities [Table Text Block] | ' | ||||||||||||||||
Other long-term liabilities consisted of the following at June 30, 2014 and December 31, 2013: | |||||||||||||||||
As of | As of | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Customer deposit | $ | 250,000 | $ | - | |||||||||||||
Long-term portion of capital lease liability | 116,378 | 54,639 | |||||||||||||||
$ | 366,378 | $ | 54,639 | ||||||||||||||
Schedule Of Sales [Table Text Block] | ' | ||||||||||||||||
Sales for the three and six months ended June 30, 2014 and 2013 were as follows: | |||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Sales | $ | 51,828,561 | $ | 28,515,483 | $ | 108,533,847 | $ | 53,439,519 | |||||||||
Discounts and returns | -5,088,574 | -3,035,424 | -11,584,406 | -5,398,293 | |||||||||||||
Sales - Net | $ | 46,739,987 | $ | 25,480,059 | $ | 96,949,441 | $ | 48,041,226 | |||||||||
Discounts as a percent of gross sales | 10 | % | 11 | % | 11 | % | 10 | % | |||||||||
Financial_Instruments_Tables
Financial Instruments (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Fair Value Disclosures [Abstract] | ' | |||||||
Schedule of Derivative Liabilities at Fair Value [Table Text Block] | ' | |||||||
The following table is a summary of financial assets and liabilities: | ||||||||
As of June 30, | As of December 31, | |||||||
2014 | 2013 | |||||||
Assets | ||||||||
Debt securities – FUSE convertible notes (Level 2) | $ | - | $ | 259,715 | ||||
Derivative instruments – FUSE warrants (Level 2) | - | 119,248 | ||||||
- | 378,963 | |||||||
Liabilities | ||||||||
Derivative liabilities - Series D shares (Level 2) | $ | - | $ | 1,147,330 | ||||
Debt_Tables
Debt (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Schedule Of Long Term Debt [Table Text Block] | ' | |||||||
Debt consists of the following: | ||||||||
As of June 30, 2014 | As of December 31, 2013 | |||||||
Notes payable | $ | 45,600 | $ | 59,600 | ||||
Revolving line of credit | - | 2,500,000 | ||||||
Auto loan - secured | - | 2,902 | ||||||
Total debt | 45,600 | 2,562,502 | ||||||
Less: current portion | -45,600 | -2,562,502 | ||||||
Long term debt | $ | - | $ | - | ||||
Schedule Of Convertible Debt Activity And Terms [Table Text Block] | ' | |||||||
Notes payable consisted of the following activity and terms: | ||||||||
Balance – December 31, 2013 | $ | 59,600 | ||||||
Principal repayments | -14,000 | |||||||
Balance – June 30, 2014 | $ | 45,600 | ||||||
Schedule Of Auto Loan Activity and Terms [Table Text Block] | ' | |||||||
Vehicle loan account consisted of the following activity and terms: | ||||||||
Balance - December 31, 2013 | $ | 2,902 | ||||||
Principal repayments | -2,902 | |||||||
Balance – June 30, 2014 | $ | - | ||||||
Derivative_Liabilities_Tables
Derivative Liabilities (Tables) | 6 Months Ended | ||||
Jun. 30, 2014 | |||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||
Schedule Of Fair Value Of Derivative Instruments Conversion Feature [Table Text Block] | ' | ||||
The fair value of the conversion feature is summarized as follows: | |||||
Derivative liability - December 31, 2013 | 1,147,330 | ||||
Fair value mark to market adjustment for equity instruments | -373,944 | ||||
Conversion instruments exercise | -773,386 | ||||
Derivative liability – June 30, 2014 | $ | - | |||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | ||||||||||||||||||||
Schedule of Stockholders Equity [Table Text Block] | ' | ||||||||||||||||||||
During the six months ended June 30, 2014, the Company issued the following common stock: | |||||||||||||||||||||
Transaction Type | Quantity | Valuation | Range of Value | ||||||||||||||||||
(#) | ($) | per Share | |||||||||||||||||||
($) | |||||||||||||||||||||
Conversion of Series D preferred stock to common stock | 263,000 | 773,517 | 2.94 | ||||||||||||||||||
Executive/Board of Director compensation | 60,422 | 265,325 | 3.48 – 8.70 | ||||||||||||||||||
Stock issued for Biozone acquisition | 1,200,000 | 9,840,000 | 8.2 | ||||||||||||||||||
Total | 1,523,422 | 10,878,842 | 2.94 – 8.70 | ||||||||||||||||||
Schedule Of Common Stock Equivalents [Table Text Block] | ' | ||||||||||||||||||||
The Company has the following common stock equivalents as of June 30, 2014 and 2013, respectively: | |||||||||||||||||||||
As of June 30, | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Stock options (exercise price – $425/share) | 472 | 670 | |||||||||||||||||||
Warrants (exercise price – $4 /share) | - | 330,000 | |||||||||||||||||||
Warrants (exercise price - $1,275/share) | 89 | 89 | |||||||||||||||||||
Employee and director unvested RSUs | 1,501,573 | 86,275 | |||||||||||||||||||
Total common stock equivalents | 1,502,134 | 417,034 | |||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | ' | ||||||||||||||||||||
The following is a reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three and six months ended June 30, 2014 and 2013, respectively: | |||||||||||||||||||||
Three months ended | Six months ended | ||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||
As Restated | As Restated | ||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||
Net income (loss) | $ | -934,515 | $ | -2,421,808 | $ | 1,801,719 | $ | -9,783,789 | |||||||||||||
Weighted average number of common shares outstanding | 10,610,022 | 7,226,849 | 10,459,522 | 5,686,323 | |||||||||||||||||
Incremental shares from the assumed exercise of dilutive agreements | - | - | 1,404,360 | - | |||||||||||||||||
Diluted common shares outstanding | 10,610,022 | 7,226,849 | 11,863,882 | 5,686,323 | |||||||||||||||||
Earnings (loss) per shares - basic | $ | -0.09 | $ | -0.34 | $ | 0.17 | $ | -1.72 | |||||||||||||
Earnings (loss) per shares - diluted | $ | -0.09 | $ | -0.34 | $ | 0.15 | $ | -1.72 | |||||||||||||
Schedule Of Warrants Activity [Table Text Block] | ' | ||||||||||||||||||||
A summary of warrant activity for the Company for the six months ended June 30, 2014 is as follows: | |||||||||||||||||||||
Number of Warrants | Weighted Average Exercise Price | ||||||||||||||||||||
Outstanding – December 31, 2013 | 263,089 | $ | 4.43 | ||||||||||||||||||
Granted | - | - | |||||||||||||||||||
Exercised | -263,000 | 4 | |||||||||||||||||||
Balance as June 30, 2014 | 89 | $ | 1,275 | ||||||||||||||||||
Warrants Outstanding | Warrants Exercisable | ||||||||||||||||||||
Range of | Number | Weighted Average | Weighted Average | Number | Weighted | Intrinsic Value | |||||||||||||||
Exercise Prices | Outstanding | Remaining | Exercise Price | Exercisable | Average | ||||||||||||||||
Contractual Life (in | Exercise Price | ||||||||||||||||||||
years) | |||||||||||||||||||||
$ | 1,275 | 89 | 1.04 | $ | 1,275 | 89 | $ | 1,275 | - | ||||||||||||
Committments_Contingencies_and
Committments, Contingencies and Other Matters (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
Operating Leased Assets [Line Items] | ' | |||||||||||||||||||
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | ' | |||||||||||||||||||
As of June 30, 2014, future minimum lease payments are as follows: | ||||||||||||||||||||
Years Ending December 31, | ||||||||||||||||||||
2014 (remaining 6 months) | $ | 618,426 | ||||||||||||||||||
2015 | 1,087,030 | |||||||||||||||||||
2016 | 884,061 | |||||||||||||||||||
2017 | 841,118 | |||||||||||||||||||
2018 | 838,246 | |||||||||||||||||||
Thereafter | 3,519,391 | |||||||||||||||||||
Total minimum lease payments | $ | 7,788,272 | ||||||||||||||||||
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | ' | |||||||||||||||||||
As of June 30, 2014, future minimum lease payments are as follows: | ||||||||||||||||||||
Years Ending December 31, | ||||||||||||||||||||
2014 (remaining 6 months) | $ | 45,661 | ||||||||||||||||||
2015 | 91,321 | |||||||||||||||||||
2016 | 79,472 | |||||||||||||||||||
2017 | 5,898 | |||||||||||||||||||
Total minimum lease payments | 222,352 | |||||||||||||||||||
Less amounts representing interest | -28,647 | |||||||||||||||||||
Present value of minimum lease payments | $ | 193,705 | ||||||||||||||||||
Sponsorship and Endorsement Contract Liabilities [Member] | ' | |||||||||||||||||||
Operating Leased Assets [Line Items] | ' | |||||||||||||||||||
Contractual Obligation, Fiscal Year Maturity Schedule [Table Text Block] | ' | |||||||||||||||||||
The total value of outstanding payments as of June 30, 2014 was $37,102,417. The total outstanding payments are as follows: | ||||||||||||||||||||
Outstanding Payments | 2014 | 2015 | 2016 | 2017 | 2018 | Total | ||||||||||||||
Endorsement | $ | 3,730,750 | $ | 8,280,834 | $ | 6,490,833 | $ | 6,600,000 | $ | 3,500,000 | $ | 28,602,417 | ||||||||
Sponsorship | 2,357,500 | 4,905,000 | 1,137,500 | 100,000 | - | 8,500,000 | ||||||||||||||
Total | $ | 6,088,250 | $ | 13,185,834 | $ | 7,628,333 | $ | 6,700,000 | $ | 3,500,000 | $ | 37,102,417 | ||||||||
Biozone_Acquisition_Tables
Biozone Acquisition (Tables) | 6 Months Ended | |||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||
Business Combinations [Abstract] | ' | |||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | ' | |||||||||||||||||
Based upon the fair values acquired, the purchase price allocation is as follows: | ||||||||||||||||||
Purchase Price Allocation | ||||||||||||||||||
Net Tangible Assets | ||||||||||||||||||
Property & equipment | $ | 1,859,066 | ||||||||||||||||
Receivables | 806,212 | |||||||||||||||||
Inventory | 840,999 | |||||||||||||||||
Other assets | 577,453 | |||||||||||||||||
Factoring payable | -795,031 | |||||||||||||||||
Trade payables | -327,038 | |||||||||||||||||
Equipment leases | -122,766 | |||||||||||||||||
Employee compensation liability | -78,134 | |||||||||||||||||
Other liabilities | -76,423 | |||||||||||||||||
Total net tangible assets acquired | 2,684,338 | |||||||||||||||||
Identified Intangible Assets | ||||||||||||||||||
Patents | $ | 5,869,874 | ||||||||||||||||
Trademarks | 656,160 | |||||||||||||||||
Customer lists | 629,607 | |||||||||||||||||
Domain name | 21 | |||||||||||||||||
Total identified intangible assets acquired | 7,155,662 | |||||||||||||||||
Total purchase price | $ | 9,840,000 | ||||||||||||||||
Schedule of Business Combination Acquired Receivables [Table Text Block] | ' | |||||||||||||||||
As of the date of the acquisition the Company determined that none of the receivables were uncollectible. | ||||||||||||||||||
Receivables | Estimated Fair | Contractual | ||||||||||||||||
Value | Value | |||||||||||||||||
Trade receivables | $ | 806,212 | $ | 807,294 | ||||||||||||||
Factoring receivable | 150,702 | 151,016 | ||||||||||||||||
Asset sale receivable | 399,814 | 400,000 | ||||||||||||||||
Business Acquisition, Pro Forma Information [Table Text Block] | ' | |||||||||||||||||
The unaudited pro forma effects of the acquisition on the results of operations as if the acquisition had been completed on January 1, 2013 for the three and six months ended June 30, 2013 is as follows: | ||||||||||||||||||
Three Months Ended June 30, 2013 | ||||||||||||||||||
Combined | ||||||||||||||||||
BioZone | Before Pro | MusclePharm | ||||||||||||||||
MusclePharm | Pharmaceuticals | Forma | Pro Forma | Corp. | ||||||||||||||
Corp. | Inc. | Adjustments | Adjustments | Pro Forma | ||||||||||||||
Sales - net | $ | 25,480,059 | $ | 1,801,600 | $ | 27,281,659 | $ | - | $ | 27,281,659 | ||||||||
Net loss | -2,421,808 | -708,484 | -3,130,292 | -119,093 | (a) | -3,249,385 | ||||||||||||
Net loss per share – basic and diluted | $ | -0.34 | - | - | - | $ | -0.45 | |||||||||||
Weighted average number of common shares used in per share calculations – basic and diluted | 7,226,849 | - | - | - | 7,226,849 | |||||||||||||
Six Months Ended June 30, 2013 | ||||||||||||||||||
Combined | ||||||||||||||||||
BioZone | Before Pro | MusclePharm | ||||||||||||||||
MusclePharm | Pharmaceuticals | Forma | Pro Forma | Corp. | ||||||||||||||
Corp. | Inc. | Adjustments | Adjustments | Pro Forma | ||||||||||||||
Sales - net | $ | 48,041,226 | $ | 3,677,131 | $ | 51,718,357 | $ | - | $ | 51,718,357 | ||||||||
Net loss | -9,783,789 | -1,820,351 | -11,604,140 | -247,400 | (a) | -11,851,540 | ||||||||||||
Net loss per share – basic and diluted | $ | -1.72 | - | - | - | $ | -2.08 | |||||||||||
Weighted average number of common shares used in per share calculations – basic and diluted | 5,686,323 | - | - | - | 5,686,323 | |||||||||||||
(a) | Pro forma adjustment to eliminate historical seller depreciation expense and record depreciation and amortization expense resulting from the assets acquired. | |||||||||||||||||
Intangible_Assets_Tables
Intangible Assets (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block] | ' | |||||||||||||
Intangible assets consist of the following: | ||||||||||||||
As of June 30, 2014 | ||||||||||||||
Gross Assets | Accumulated | Net Assets | Weighted | |||||||||||
Amortization | average | |||||||||||||
amortization | ||||||||||||||
period (years) | ||||||||||||||
Amortized intangible assets | ||||||||||||||
Patents | $ | 5,922,374 | $ | -456,547 | $ | 5,465,827 | 8.25 | |||||||
Trademarks | 691,160 | -69,281 | 621,879 | 7.02 | ||||||||||
Customer relationships | 629,607 | -52,467 | 577,140 | 5.51 | ||||||||||
7,243,141 | -578,295 | 6,664,846 | ||||||||||||
Indefinite lived intangible assets | ||||||||||||||
Domain name | 67,686 | - | 67,686 | - | ||||||||||
67,686 | - | 67,686 | ||||||||||||
Total intangible assets | $ | 7,310,827 | $ | -578,295 | $ | 6,732,532 | ||||||||
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | ' | |||||||||||||
As of June 30, 2014, the estimated future amortization expense of intangible assets is as follows: | ||||||||||||||
2014 (remaining 6 months) | $ | 550,097 | ||||||||||||
2015 | 1,106,314 | |||||||||||||
2016 | 999,955 | |||||||||||||
2017 | 926,090 | |||||||||||||
2018 | 902,187 | |||||||||||||
Thereafter | 2,180,203 | |||||||||||||
Total amortization expense | $ | 6,664,846 | ||||||||||||
Restatement_of_June_30_2014_Un1
Restatement of June 30, 2014 Unaudited Consolidated Financial Statements (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Accounting Changes and Error Corrections [Abstract] | ' | |||||||
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] | ' | |||||||
The following sets forth summarized unaudited consolidated balance sheet information on the effects of the restatements: | ||||||||
As of June 30, 2014 | ||||||||
As Previously | As | |||||||
Reported | Restated | |||||||
Current assets | $ | 50,547,702 | $ | 49,204,859 | ||||
Property and equipment - net | 6,221,261 | 6,221,261 | ||||||
Intangible assets - net | 6,732,532 | 6,732,532 | ||||||
Prepaid stock compensation | 3,251,791 | 3,251,791 | ||||||
Other assets | 179,632 | 179,632 | ||||||
$ | 66,932,918 | $ | 65,590,075 | |||||
Current liabilities | 28,473,117 | 28,473,117 | ||||||
Other long-term liabilities | 366,378 | 366,378 | ||||||
Stockholders' equity | 38,093,423 | 36,750,580 | ||||||
$ | 66,932,918 | $ | 65,590,075 | |||||
The following sets forth summarized unaudited consolidated statement of operations information on the effects of the restatements: | ||||||||
For the Six Months Ended | ||||||||
June 30, 2014 | ||||||||
As Previously | As | |||||||
Reported | Restated | |||||||
Sales - net | $ | 96,949,441 | $ | 96,949,441 | ||||
Cost of sales | 63,429,609 | 63,429,609 | ||||||
Gross profit | 33,519,832 | 33,519,832 | ||||||
Operating expenses | 30,616,428 | 31,959,271 | ||||||
Operating income | 2,903,404 | 1,560,561 | ||||||
Other income (expense) | 318,105 | 318,105 | ||||||
Net income before taxes | 3,221,509 | 1,878,666 | ||||||
Provision for income taxes | -76,947 | -76,947 | ||||||
Net income | 3,144,562 | 1,801,719 | ||||||
Other comprehensive income (expense) | 18,707 | 18,707 | ||||||
Total other comprehensive income | $ | 3,163,269 | $ | 1,820,426 | ||||
Earnings (loss) per share | ||||||||
Net income per common share | ||||||||
Basic | $ | 0.3 | $ | 0.17 | ||||
Diluted | $ | 0.27 | $ | 0.15 | ||||
Weighted average number of shares used in per share calculations - Basic | 10,459,522 | 10,459,522 | ||||||
Weighted average number of shares used in per share calculations - Diluted | 11,863,882 | 11,863,882 | ||||||
For the Three Months Ended | ||||||||
June 30, 2014 | ||||||||
As Previously | As | |||||||
Reported | Restated | |||||||
Sales - net | $ | 46,739,987 | $ | 46,739,987 | ||||
Cost of sales | 31,093,224 | 31,093,224 | ||||||
Gross profit | 15,646,763 | 15,646,763 | ||||||
Operating expenses | 15,167,248 | 16,510,091 | ||||||
Operating income | 479,515 | -863,328 | ||||||
Other income (expense) | -26,401 | -26,401 | ||||||
Net income (loss) before taxes | 453,114 | -889,729 | ||||||
Provision for income taxes | -44,786 | -44,786 | ||||||
Net income (loss) | 408,328 | -934,515 | ||||||
Other comprehensive income (expense) | 22,954 | 22,954 | ||||||
Total other comprehensive income (loss) | $ | 431,282 | $ | -911,561 | ||||
Earnings (loss) per share | ||||||||
Net income per common share | ||||||||
Basic | $ | 0.04 | $ | -0.09 | ||||
Diluted | $ | 0.03 | $ | -0.09 | ||||
Weighted average number of shares used in per share calculations - Basic | 10,610,022 | 10,610,022 | ||||||
Weighted average number of shares used in per share calculations - Diluted | 12,064,122 | 10,610,022 | ||||||
Composition_of_Certain_Financi2
Composition of Certain Financial Statement Captions (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Accounts receivable | $19,849,929 | $14,830,487 |
Less: allowance for discounts | -511,066 | -1,060,000 |
Less: allowance for doubtful accounts | -141,319 | -29,307 |
Accounts receivable - net | $19,197,544 | $13,741,180 |
Composition_of_Certain_Financi3
Composition of Certain Financial Statement Captions (Details 1) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Inventory [Line Items] | ' | ' |
Raw materials inventory | $970,538 | $0 |
Work in process inventory | 170,843 | 0 |
Finished goods inventory | 18,756,934 | 16,001,515 |
Inventory reserve | -128,959 | -229,147 |
Total inventory - net | $19,769,356 | $15,772,368 |
Composition_of_Certain_Financi4
Composition of Certain Financial Statement Captions (Details 2) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Prepaid advertising and promotion | $700,707 | $760,740 |
Prepaid inventory | 385,679 | 0 |
Prepaid insurance | 263,632 | 280,878 |
Prepaid professional services | 226,120 | 74,730 |
Prepaid director fees | 116,000 | 0 |
Prepaid research & development fees | 84,221 | 22,500 |
Prepaid license fees | 77,141 | 90,623 |
Prepaid software license fees | 40,743 | 86,205 |
Prepaid support agreements | 36,697 | 3,499 |
Prepaid - other | 58,657 | 16,043 |
Prepaid Expense, Current | $1,989,597 | $1,335,218 |
Composition_of_Certain_Financi5
Composition of Certain Financial Statement Captions (Details 3) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Vendor rebate receivable | $119,467 | $0 |
Other receivable from Cocrystal Pharma, Inc. | 209,396 | 0 |
Other current assets | 4,377 | 40,805 |
Other Assets, Current | $333,240 | $40,805 |
Composition_of_Certain_Financi6
Composition of Certain Financial Statement Captions (Details 5) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Security deposit | $108,394 | $85,419 |
Long-term portion of prepaid assets | 71,238 | 58,810 |
Other Assets, Noncurrent | $179,632 | $144,229 |
Composition_of_Certain_Financi7
Composition of Certain Financial Statement Captions (Details 4) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | $8,216,809 | $3,974,575 |
Less: Accumulated depreciation and amortization | -1,995,548 | -1,360,991 |
Property, Plant and Equipment, Net | 6,221,261 | 2,613,584 |
Furniture, Fixtures And Equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 3,173,284 | 1,849,462 |
Furniture, Fixtures And Equipment [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '3 years | ' |
Furniture, Fixtures And Equipment [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '5 years | ' |
Leasehold Improvements [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 2,189,963 | 619,159 |
Leasehold Improvements [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '20 months | ' |
Leasehold Improvements [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '182 months | ' |
Manufacturing and lab equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 1,231,251 | 0 |
Manufacturing and lab equipment [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '2 years | ' |
Manufacturing and lab equipment [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '20 years | ' |
Vehicles [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 444,065 | 442,300 |
Vehicles [Member] | Minimum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '2 years | ' |
Vehicles [Member] | Maximum [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant and Equipment, Estimated Useful Life (in years) | '5 years | ' |
Displays [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 33,683 | 33,683 |
Property, Plant and Equipment, Estimated Useful Life (in years) | '5 years | ' |
Website [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | 15,975 | 11,462 |
Property, Plant and Equipment, Estimated Useful Life (in years) | '3 years | ' |
Construction in Progress [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Total | $1,128,588 | $1,018,509 |
Composition_of_Certain_Financi8
Composition of Certain Financial Statement Captions (Details 6) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Accrued payables | $2,606,779 | $487,415 |
Employee compensation and benefits | 1,717,265 | 1,137,681 |
Capital leases | 77,327 | 26,653 |
Customer deposits | 67,747 | 265,652 |
Accrued taxes | 25,832 | 71,771 |
Other | 32,135 | 63,929 |
Accrued Liabilities, Current | $4,527,085 | $2,053,101 |
Composition_of_Certain_Financi9
Composition of Certain Financial Statement Captions (Details 7) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Customer deposit | $250,000 | $0 |
Long-term portion of capital lease liability | 116,378 | 54,639 |
Other Liabilities, Noncurrent | $366,378 | $54,639 |
Recovered_Sheet1
Composition of Certain Financial Statement Captions (Details 8) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' | ' | ' |
Sales | $51,828,561 | $28,515,483 | $108,533,847 | $53,439,519 |
Discounts and returns | -5,088,574 | -3,035,424 | -11,584,406 | -5,398,293 |
Sales - Net | $46,739,987 | $25,480,059 | $96,949,441 | $48,041,226 |
Discounts as a percent of gross sales | 10.00% | 11.00% | 11.00% | 10.00% |
Recovered_Sheet2
Composition of Certain Financial Statement Captions (Details Textual) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Inventory, Finished Goods, Gross | $18,756,934 | $16,001,515 |
Third Party Manufacturers [Member] | ' | ' |
Composition Of Certain Financial Statement Captions [Line Items] | ' | ' |
Inventory, Finished Goods, Gross | $18,693,505 | $16,001,515 |
Concentrations_Details
Concentrations (Details) (Accounts Receivable [Member]) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2014 | Dec. 31, 2013 | |||
Customer A [Member] | ' | ' | ||
Concentration Risk [Line Items] | ' | ' | ||
Concentration Risk, Percentage | 10.00% | 16.00% | ||
Customer B [Member] | ' | ' | ||
Concentration Risk [Line Items] | ' | ' | ||
Concentration Risk, Percentage | 10.00% | 0.00% | [1] | |
Customer C [Member] | ' | ' | ||
Concentration Risk [Line Items] | ' | ' | ||
Concentration Risk, Percentage | 0.00% | [1] | 24.00% | |
Bodybuilding.com [Member] | ' | ' | ||
Concentration Risk [Line Items] | ' | ' | ||
Concentration Risk, Percentage | 0.00% | [1] | 14.00% | |
[1] | Less than 10% of total accounts receivable |
Concentrations_Details_1
Concentrations (Details 1) (Sales Revenue, Net [Member]) | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |||||
Bodybuilding.com [Member] | ' | ' | ' | ' | ||||
Concentration Risk [Line Items] | ' | ' | ' | ' | ||||
Concentration Risk, Percentage | 15.00% | 25.00% | 15.00% | 29.00% | ||||
Customer B [Member] | ' | ' | ' | ' | ||||
Concentration Risk [Line Items] | ' | ' | ' | ' | ||||
Concentration Risk, Percentage | 10.00% | 0.00% | [1] | 10.00% | 11.00% | |||
Customer C [Member] | ' | ' | ' | ' | ||||
Concentration Risk [Line Items] | ' | ' | ' | ' | ||||
Concentration Risk, Percentage | 0.00% | [1] | 11.00% | 0.00% | [1] | 0.00% | [1] | |
[1] | Less than 10% of gross sales |
Concentrations_Details_2
Concentrations (Details 2) (Cost of Goods, Total [Member]) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Vendor A [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration Risk, Percentage | 47.00% | 70.00% | 50.00% | 82.00% |
vendor B [Member] | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' |
Concentration Risk, Percentage | 50.00% | 30.00% | 47.00% | 18.00% |
Financial_Instruments_Details
Financial Instruments (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Assets | ' | ' |
Debt securities - FUSE convertible notes (Level 2) | $0 | $259,715 |
Derivative instruments - FUSE warrants (Level 2) | 0 | 119,248 |
Assets, Fair Value Disclosure, Total | 0 | 378,963 |
Liabilities | ' | ' |
Derivative liabilities - Series D shares (Level 2) | $0 | $1,147,330 |
Financial_Instruments_Details_
Financial Instruments (Details Textual) (USD $) | 0 Months Ended |
Apr. 02, 2014 | |
Financial Instruments [Line Items] | ' |
Sale Of Convertible Notes And Warrants | $215,000 |
Debt_Details
Debt (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Schedule of Capitalization, Long-term Debt [Line Items] | ' | ' |
Notes payable | $45,600 | $59,600 |
Revolving line of credit | 0 | 2,500,000 |
Auto loan - secured | 0 | 2,902 |
Total debt | 45,600 | 2,562,502 |
Less: current portion | -45,600 | -2,562,502 |
Long term debt | $0 | $0 |
Debt_Details_1
Debt (Details 1) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Debt Instrument [Line Items] | ' |
Balance - December 31, 2013 | $59,600 |
Principal repayments | -14,000 |
Balance - June 30, 2014 | $45,600 |
Debt_Details_2
Debt (Details 2) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Debt Instrument [Line Items] | ' |
Balance - December 31, 2013 | $2,902 |
Principal repayments | -2,902 |
Balance - June 30, 2014 | $0 |
Debt_Details_Textual
Debt (Details Textual) (USD $) | 6 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2014 | Dec. 31, 2013 | Dec. 24, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | |
Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | U.S. Bank, N.A D Savings Deposits [Member] | ||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Debt Default, Short-term Debt, Amount | $45,600 | $59,600 | ' | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | 2,500,000 | ' | ' | ' |
Line of Credit Facility, Expiration Date | 15-Sep-14 | ' | ' | ' | ' | ' |
Line of Credit Facility, Interest Rate Description | 'prime plus 2% | ' | ' | ' | ' | ' |
Restricted Cash and Investments, Current, Total | ' | ' | ' | ' | ' | 2,500,000 |
Debt Instrument, Interest Rate During Period | ' | ' | ' | ' | 6.99% | ' |
Debt Instrument, Periodic Payment | ' | ' | ' | $1,008 | ' | ' |
Derivative_Liabilities_Details
Derivative Liabilities (Details) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Derivative Liabilities [Line Items] | ' | ' |
Derivative liability - December 31, 2013 | $1,147,330 | ' |
Fair value mark to market adjustment for equity instruments | -373,944 | ' |
Conversion instruments exercise | 773,386 | 0 |
Derivative liability - June 30, 2014 | $0 | ' |
Derivative_Liabilities_Details1
Derivative Liabilities (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Apr. 02, 2014 | |
Derivative Liabilities [Line Items] | ' | ' | ' | ' | ' |
Derivative expense | $0 | $0 | $0 | $96,913 | ' |
Embedded Derivative, Fair Value of Embedded Derivative Liability | ' | ' | ' | ' | $773,254 |
Restricted_Stock_Units_Details
Restricted Stock Units (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | 6 Months Ended | 1 Months Ended | 6 Months Ended | 1 Months Ended | 6 Months Ended | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Nov. 30, 2012 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2014 | Mar. 17, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | |
Subsequent Event [Member] | December 31, 2013 [Member] | December 31, 2015 [Member] | Restricted Stock [Member] | Chief Financial Officer [Member] | Chief Financial Officer [Member] | key employees officers and directors [Member] | key employees officers and directors [Member] | key employees officers and directors [Member] | Director [Member] | Director [Member] | Director [Member] | Director [Member] | |||||
Subsequent Event [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | |||||||||||
December 31, 2015 [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, Issued For Services (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 129,413 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Issued For Services | ' | ' | ' | ' | ' | ' | ' | ' | $449,900 | ' | ' | ' | ' | ' | ' | ' | ' |
Shares Vesting In Next Twelve Months Number | ' | ' | ' | ' | ' | ' | ' | ' | ' | 43,137 | ' | ' | ' | ' | ' | ' | ' |
Shares Vesting In Year Two Number | 43,138 | ' | 43,138 | ' | 43,138 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | 86,275 | ' | ' | ' | ' | ' | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not Yet Recognized | 9,412,449 | ' | 9,412,449 | ' | ' | ' | ' | ' | ' | 75,600 | ' | ' | ' | ' | 160,438 | ' | 101,328 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,550,000 | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,200 | ' | ' | 16,284 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,517,202 | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Restricted Stock Award, Gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,065,500 | ' | ' | 320,007 | ' | 152,000 | ' |
Restricted stock agreement grant vesting percentage | ' | ' | ' | ' | ' | 17.00% | 83.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 263,500 | ' | ' | ' | ' |
Share-based Compensation | 2,117,332 | 37,389 | 4,466,876 | 74,366 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 48,856 | ' | 19,364 | ' |
Stock Granted, Value, Share-based Compensation, Gross | ' | ' | ' | ' | ' | ' | ' | $1,137,600 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Class of Stock [Line Items] | ' |
Conversion of Series D preferred stock to common stock, Quantity | 263,000 |
Conversion of Series D preferred stock to common stock, Valuation | $773,517 |
Conversion of Series D preferred stock to common stock, Range Of value per share | $2.94 |
Executive/Board of Director compensation, Quantity | 60,422 |
Executive/Board of Director compensation, Valuation | 265,325 |
Stock issued for Biozone acquisition, Quantity | 1,200,000 |
Stock issued for Biozone acquisition, Valuation | 9,840,000 |
Stock issued for Biozone acquisition, Range of value per share | $8.20 |
Total, Quantity | 1,523,422 |
Total, Valuation | $10,878,842 |
Minimum [Member] | ' |
Class of Stock [Line Items] | ' |
Executive/Board of Director compensation, Range of Value per share | $3.48 |
Total, Range of Value per Share | $2.94 |
Maximum [Member] | ' |
Class of Stock [Line Items] | ' |
Executive/Board of Director compensation, Range of Value per share | $8.70 |
Total, Range of Value per Share | $8.70 |
Stockholders_Equity_Details_1
Stockholders' Equity (Details 1) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Class of Stock [Line Items] | ' | ' |
Total common stock equivalents | 1,502,134 | 417,034 |
Employee Stock Option [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Total common stock equivalents | 472 | 670 |
Warrant [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Total common stock equivalents | 0 | 330,000 |
Warrants One [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Total common stock equivalents | 89 | 89 |
Employee and Director Unvested Shares [Member] | ' | ' |
Class of Stock [Line Items] | ' | ' |
Total common stock equivalents | 1,501,573 | 86,275 |
Stockholders_Equity_Details_2
Stockholders' Equity (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Class of Stock [Line Items] | ' | ' | ' | ' |
Net income (loss) | ($934,515) | ($2,421,808) | $1,801,719 | ($9,783,789) |
Weighted average number of common shares outstanding (in shares) | 10,610,022 | 7,226,849 | 10,459,522 | 5,686,323 |
Incremental shares from the assumed exercise of dilutive agreements (in shares) | 0 | 0 | 1,404,360 | 0 |
Diluted common shares outstanding | 10,610,022 | 7,226,849 | 11,863,882 | 5,686,323 |
Earnings (loss) per shares - basic (in dollars per share) | ($0.09) | ($0.34) | $0.17 | ($1.72) |
Earnings (loss) per shares - diluted (in dollars per share) | ($0.09) | ($0.34) | $0.15 | ($1.72) |
Stockholders_Equity_Details_3
Stockholders' Equity (Details 3) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Class of Stock [Line Items] | ' |
Number of Warrants, Outstanding Balance (in shares) | 263,089 |
Number of Warrants, Granted (in shares) | 0 |
Number of Warrants, Exercised (in shares) | -263,000 |
Number of Warrants, Outstanding Balance (in shares) | 89 |
Weighted Average Exercise Price, Balance (in dollars per share) | $4.43 |
Weighted Average Exercise Price, Granted (in dollars per share) | $0 |
Weighted Average Exercise Price, Exercised/ (in dollars per share) | $4 |
Weighted Average Exercise Price, Balance (in dollars per share) | $1,275 |
Warrant [Member] | ' |
Class of Stock [Line Items] | ' |
Weighted Average Exercise Price, Balance (in dollars per share) | $1,275 |
Warrant Outstanding Number Outstanding | 89 |
Warrants Outstanding, Weighted Average Remaining Contractual Life (in years) | '1 year 14 days |
Warrant Outstanding Weighted Average Exercise Price | $1,275 |
Warrants Exercisable, Numbers Exercisable (in shares) | 89 |
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share) | $1,275 |
Warrants Exercisable, Intrinsic Value | $0 |
Stockholders_Equity_Details_Te
Stockholders' Equity (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | 1 Months Ended | ||||||
Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Apr. 02, 2014 | Feb. 04, 2013 | Jun. 30, 2014 | Apr. 02, 2014 | Dec. 31, 2013 | Jan. 31, 2013 | |
Common Stock [Member] | Series D Convertible Preferred Stock [Member] | Series D Convertible Preferred Stock [Member] | Series D Convertible Preferred Stock [Member] | Series D Convertible Preferred Stock [Member] | Series D Convertible Preferred Stock [Member] | ||||
Stockholders Equity Disclosure [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, shares authorized | ' | ' | ' | ' | ' | 1,600,000 | ' | 1,600,000 | 1,600,000 |
Number Of Shares Sold Under Subscription Agreement | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' |
Proceeds from Issuance of Preferred Stock and Preference Stock | ' | $0 | $12,000,000 | ' | $12,000,000 | ' | ' | ' | ' |
Preferred Stock, Shares Outstanding | ' | ' | ' | 263,000 | ' | 0 | 131,500 | 131,500 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period | 1,177 | ' | 1,177 | ' | ' | ' | ' | ' | ' |
Commitments_Contingencies_and_1
Commitments, Contingencies and Other Matters (Details) (USD $) | Jun. 30, 2014 |
Years Ending December 31, | ' |
2014 (remaining 6 months) | $618,426 |
2015 | 1,087,030 |
2016 | 884,061 |
2017 | 841,118 |
2018 | 838,246 |
Thereafter | 3,519,391 |
Total minimum lease payments | $7,788,272 |
Commitments_Contingencies_and_2
Commitments, Contingencies and Other Matters (Details 1) (USD $) | Jun. 30, 2014 |
Years Ending December 31, | ' |
2014 (remaining 6 months) | $45,661 |
2015 | 91,321 |
2016 | 79,472 |
2017 | 5,898 |
Total minimum lease payments | 222,352 |
Less amounts representing interest | -28,647 |
Present value of minimum lease payments | $193,705 |
Commitments_Contingencies_and_3
Commitments, Contingencies and Other Matters (Details 2) (Sponsorship and Endorsement Contract Liabilities [Member], USD $) | Jun. 30, 2014 |
Contractual Obligation, Fiscal Year Maturity [Line Items] | ' |
2014 | $6,088,250 |
2015 | 13,185,834 |
2016 | 7,628,333 |
2017 | 6,700,000 |
2018 | 3,500,000 |
Total | 37,102,417 |
Endorsement [Member] | ' |
Contractual Obligation, Fiscal Year Maturity [Line Items] | ' |
2014 | 3,730,750 |
2015 | 8,280,834 |
2016 | 6,490,833 |
2017 | 6,600,000 |
2018 | 3,500,000 |
Total | 28,602,417 |
Sponsorship [Member] | ' |
Contractual Obligation, Fiscal Year Maturity [Line Items] | ' |
2014 | 2,357,500 |
2015 | 4,905,000 |
2016 | 1,137,500 |
2017 | 100,000 |
2018 | 0 |
Total | $8,500,000 |
Commitments_Contingencies_and_4
Commitments, Contingencies and Other Matters (Details Textual) (USD $) | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
Commitments And Contingency [Line Items] | ' | ' | ' |
Operating Lease Expire Term | '2029 | ' | ' |
Operating Leases, Rent Expense, Net | $632,882 | $298,887 | ' |
Product Liability Insurance Deduction | 10,000 | ' | ' |
Aggregate Product Liability Retained Loss | 20,000,000 | ' | ' |
Capital Lease Obligations, Current | 77,327 | ' | ' |
Capital Lease Obligations, Noncurrent | 116,378 | ' | 54,639 |
Capital Lease Obligations | 193,705 | ' | 81,292 |
Capital Leases, Balance Sheet, Assets by Major Class, Net, Total | 233,426 | ' | ' |
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation | 14,075 | ' | ' |
Capital Lease Expire Term | '2017 | ' | ' |
Sponsorship and Endorsement Contract Liabilities [Member] | ' | ' | ' |
Commitments And Contingency [Line Items] | ' | ' | ' |
Operating Lease Expire Term | '2018 | ' | ' |
Contractual Obligation, Total | $37,102,417 | ' | ' |
Defined_Contribution_Plan_Deta
Defined Contribution Plan (Details Textual) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | ' | ' |
Noncash Contribution Expense | $17,500 | ' |
Defined Contribution Plan, Employer Discretionary Contribution Amount | $148,745 | $28,530 |
Related_Party_Transactions_Det
Related Party Transactions (Details Textual) (USD $) | 6 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Oct. 16, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Bodybuilding.com [Member] | Bodybuilding.com [Member] | Bodybuilding.com [Member] | Bodybuilding.com [Member] | Bodybuilding.com [Member] | Frost Real Estate Holdings, LLC [Member] | Frost Real Estate Holdings, LLC [Member] | Frost Real Estate Holdings, LLC [Member] | VP and General Manager [Member] | VP and General Manager [Member] | VP and General Manager [Member] | VP and General Manager [Member] | |||
sqft | ||||||||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue from Related Parties | ' | ' | $7,276,542 | $6,933,056 | $15,499,998 | $14,953,845 | ' | ' | ' | ' | ' | ' | ' | ' |
Due from Related Parties | ' | ' | 1,720,719 | ' | 1,720,719 | ' | 2,051,265 | ' | ' | ' | ' | ' | ' | ' |
Securities Purchase Under Agreement Description | 'The Company purchased marketing services from Bodybuilding.com during the three and six months ended June 30, 2014 in the amount of $338,877 and $688,885, respectively. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating Leases, Rent Expense, Net | $632,882 | $298,887 | ' | ' | ' | ' | ' | $15,438 | $26,828 | ' | $22,951 | $19,211 | $41,015 | $38,713 |
Lease Expiration Date | 31-Mar-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Area of Land | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,437 | ' | ' | ' | ' |
Deferred Compensation Arrangements, Overall, Description | 'the Company purchased split dollar life insurance policies on certain key executives. These policies provide a split of 50% of the death benefit proceeds to the Company and 50% to the officers designated beneficiaries | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Endorsement_Agreement_Details_
Endorsement Agreement (Details Textual) (Marine MP LLC [Member], USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Marine MP LLC [Member] | ' | ' |
Endorsement Agreement Disclosure [Line Items] | ' | ' |
Prepaid Expense | $5,889,000 | $7,300,800 |
Biozone_Acquisition_Details
Biozone Acquisition (Details) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Net Tangible Assets | ' |
Property & equipment | $1,859,066 |
Receivables | 806,212 |
Inventory | 840,999 |
Other assets | 577,453 |
Factoring payable | -795,031 |
Trade payables | -327,038 |
Equipment leases | -122,766 |
Employee compensation liability | -78,134 |
Other liabilities | -76,423 |
Total net tangible assets acquired | 2,684,338 |
Intangible assets | ' |
Total identified intangible assets acquired | 7,155,662 |
Total purchase price | 9,840,000 |
Patents [Member] | ' |
Intangible assets | ' |
Total intangible assets | 5,869,874 |
Trademarks [Member] | ' |
Intangible assets | ' |
Total intangible assets | 656,160 |
Customer Relationships [Member] | ' |
Intangible assets | ' |
Total intangible assets | 629,607 |
Domain name [Member] | ' |
Intangible assets | ' |
Total intangible assets | $21 |
Biozone_Acquisition_Details_1
Biozone Acquisition (Details 1) (USD $) | Jun. 30, 2014 |
Trade Accounts Receivable [Member] | ' |
Business Acquisition [Line Items] | ' |
Fair Value | $806,212 |
Contractual Value | 807,294 |
Factoring receivable [Member] | ' |
Business Acquisition [Line Items] | ' |
Fair Value | 150,702 |
Contractual Value | 151,016 |
Asset sale receivable [Member] | ' |
Business Acquisition [Line Items] | ' |
Fair Value | 399,814 |
Contractual Value | $400,000 |
Biozone_Acquisition_Details_2
Biozone Acquisition (Details 2) (USD $) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2013 | Jun. 30, 2013 | |
Muscle Pharm Corp. Pro Forma [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Total net revenues | $27,281,659 | $51,718,357 |
Net loss | -3,249,385 | -11,851,540 |
Net loss per share - basic and diluted | ($0.45) | ($2.08) |
Weighted average number of common shares used in per share calculations - basic and diluted | 7,226,849 | 5,686,323 |
Combined Before Pro Forma Adjustments [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Total net revenues | 27,281,659 | 51,718,357 |
Net loss | -3,130,292 | -11,604,140 |
Net loss per share - basic and diluted | $0 | $0 |
Weighted average number of common shares used in per share calculations - basic and diluted | 0 | 0 |
Pro Forma Adjustments [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Total net revenues | 0 | 0 |
Net loss | -119,093 | -247,400 |
Net loss per share - basic and diluted | $0 | $0 |
Weighted average number of common shares used in per share calculations - basic and diluted | 0 | 0 |
BioZone Pharmaceuticals Inc [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Total net revenues | 1,801,600 | 3,677,131 |
Net loss | -708,484 | -1,820,351 |
Net loss per share - basic and diluted | $0 | $0 |
Weighted average number of common shares used in per share calculations - basic and diluted | 0 | 0 |
Parent Company [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Total net revenues | 25,480,059 | 48,041,226 |
Net loss | ($2,421,808) | ($9,783,789) |
Net loss per share - basic and diluted | ($0.34) | ($1.72) |
Weighted average number of common shares used in per share calculations - basic and diluted | 7,226,849 | 5,686,323 |
Biozone_Acquisition_Details_Te
Biozone Acquisition (Details Textual) (USD $) | 6 Months Ended |
Jun. 30, 2014 | |
Business Acquisition [Line Items] | ' |
Stock Issued During Period, Shares, Acquisitions | 1,200,000 |
Escrow Period | '9 months |
Business Acquisition, Share Price | $10 |
Noncash or Part Noncash Acquisition, Noncash Financial or Equity Instrument Consideration, Shares Issued | 9,840,000 |
Escrow [Member] | ' |
Business Acquisition [Line Items] | ' |
Stock Issued During Period, Shares, Acquisitions | 600,000 |
Non-escrowed [Member] | ' |
Business Acquisition [Line Items] | ' |
Stock Issued During Period, Shares, Acquisitions | 600,000 |
Intangible_Assets_Details
Intangible Assets (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 |
Domain name [Member] | Patents [Member] | Trademarks [Member] | Customer Relationships [Member] | |||
Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Gross | $7,243,141 | ' | ' | $5,922,374 | $691,160 | $629,607 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 67,686 | ' | 67,686 | ' | ' | ' |
Intangible Assets, Gross (Excluding Goodwill), Total | 7,310,827 | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -578,295 | ' | ' | -456,547 | -69,281 | -52,467 |
Finite-Lived Intangible Assets, Net, Total | 6,664,846 | ' | ' | 5,465,827 | 621,879 | 577,140 |
Intangible Assets, Net (Excluding Goodwill), Total | $6,732,532 | $155,165 | ' | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | ' | ' | ' | '8 years 3 months | '7 years 7 days | '5 years 6 months 4 days |
Intangible_Assets_Details_1
Intangible Assets (Details 1) (USD $) | Jun. 30, 2014 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Line Items] | ' |
2014 (remaining 6 months) | $550,097 |
2015 | 1,106,314 |
2016 | 999,955 |
2017 | 926,090 |
2018 | 902,187 |
Thereafter | 2,180,203 |
Total amortization expense | $6,664,846 |
Intangible_Assets_Details_Text
Intangible Assets (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Intangible Assets [Line Items] | ' | ' | ' | ' |
Amortization of Intangible Assets | $293,113 | $0 | $578,295 | $0 |
Restatement_of_June_30_2014_Un2
Restatement of June 30, 2014 Unaudited Consolidated Financial Statements (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
Current assets | $49,204,859 | ' | $49,204,859 | ' | $44,526,480 |
Property and equipment - net | 6,221,261 | ' | 6,221,261 | ' | 2,613,584 |
Intangible assets - net | 6,732,532 | ' | 6,732,532 | ' | 155,165 |
Prepaid stock compensation | 3,251,791 | ' | 3,251,791 | ' | 4,718,238 |
Other assets | 179,632 | ' | 179,632 | ' | 144,229 |
Total assets | 65,590,075 | ' | 65,590,075 | ' | 52,157,696 |
Current liabilities | 28,473,117 | ' | 28,473,117 | ' | 32,368,521 |
Other long-term liabilities | 366,378 | ' | 366,378 | ' | 54,639 |
Stockholders' equity | 36,750,580 | ' | 36,750,580 | ' | 19,734,536 |
Total Liabilities and Stockholders' Equity | 65,590,075 | ' | 65,590,075 | ' | 52,157,696 |
Sales - net | 46,739,987 | 25,480,059 | 96,949,441 | 48,041,226 | ' |
Cost of sales | 31,093,224 | 17,566,718 | 63,429,609 | 31,963,124 | ' |
Gross profit | 15,646,763 | 7,913,341 | 33,519,832 | 16,078,102 | ' |
Operating expenses | 16,510,091 | 10,654,272 | 31,959,271 | 19,540,512 | ' |
Operating income | -863,328 | -2,740,931 | 1,560,561 | -3,462,410 | ' |
Other income (expense) | -26,401 | 319,123 | 318,105 | -6,321,379 | ' |
Net income before taxes | -889,729 | -2,421,808 | 1,878,666 | -9,783,789 | ' |
Provision for income taxes | -44,786 | 0 | -76,947 | 0 | ' |
Net income | -934,515 | -2,421,808 | 1,801,719 | -9,783,789 | ' |
Other comprehensive income (expense) | 22,954 | 4,228 | 18,707 | -1,841 | ' |
Total other comprehensive income | -911,561 | -2,417,580 | 1,820,426 | -9,785,630 | ' |
Earnings (loss) per share | ' | ' | ' | ' | ' |
Net income per common share Basic (in dollars per share) | ($0.09) | ($0.34) | $0.17 | ($1.72) | ' |
Net income per common share Diluted (in dollars per share) | ($0.09) | ($0.34) | $0.15 | ($1.72) | ' |
Weighted average number of shares used in per share calculations - Basic (in shares) | 10,610,022 | 7,226,849 | 10,459,522 | 5,686,323 | ' |
Weighted average number of shares used in per share calculations - Diluted (in shares) | 10,610,022 | 7,226,849 | 11,863,882 | 5,686,323 | ' |
Scenario, Previously Reported [Member] | ' | ' | ' | ' | ' |
Current assets | 50,547,702 | ' | 50,547,702 | ' | ' |
Property and equipment - net | 6,221,261 | ' | 6,221,261 | ' | ' |
Intangible assets - net | 6,732,532 | ' | 6,732,532 | ' | ' |
Prepaid stock compensation | 3,251,791 | ' | 3,251,791 | ' | ' |
Other assets | 179,632 | ' | 179,632 | ' | ' |
Total assets | 66,932,918 | ' | 66,932,918 | ' | ' |
Current liabilities | 28,473,117 | ' | 28,473,117 | ' | ' |
Other long-term liabilities | 366,378 | ' | 366,378 | ' | ' |
Stockholders' equity | 38,093,423 | ' | 38,093,423 | ' | ' |
Total Liabilities and Stockholders' Equity | 66,932,918 | ' | 66,932,918 | ' | ' |
Sales - net | 46,739,987 | ' | 96,949,441 | ' | ' |
Cost of sales | 31,093,224 | ' | 63,429,609 | ' | ' |
Gross profit | 15,646,763 | ' | 33,519,832 | ' | ' |
Operating expenses | 15,167,248 | ' | 30,616,428 | ' | ' |
Operating income | 479,515 | ' | 2,903,404 | ' | ' |
Other income (expense) | -26,401 | ' | 318,105 | ' | ' |
Net income before taxes | 453,114 | ' | 3,221,509 | ' | ' |
Provision for income taxes | -44,786 | ' | -76,947 | ' | ' |
Net income | 408,328 | ' | 3,144,562 | ' | ' |
Other comprehensive income (expense) | 22,954 | ' | 18,707 | ' | ' |
Total other comprehensive income | $431,282 | ' | $3,163,269 | ' | ' |
Earnings (loss) per share | ' | ' | ' | ' | ' |
Net income per common share Basic (in dollars per share) | $0.04 | ' | $0.30 | ' | ' |
Net income per common share Diluted (in dollars per share) | $0.03 | ' | $0.27 | ' | ' |
Weighted average number of shares used in per share calculations - Basic (in shares) | 10,610,022 | ' | 10,459,522 | ' | ' |
Weighted average number of shares used in per share calculations - Diluted (in shares) | 12,064,122 | ' | 11,863,882 | ' | ' |
Restatement_of_June_30_2014_Un3
Restatement of June 30, 2014 Unaudited Consolidated Financial Statements (Details Textual) (USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | 18 Months Ended | |||
Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | |
Legal Fees | $984,172 | $358,671 | ' | $1,342,843 | ' | $1,168,838 | $2,511,681 |
Professional Fees, Research and Development Expense | 1,292,517 | ' | 3,727,267 | 2,077,090 | 7,811,986 | ' | ' |
Scenario, Previously Reported [Member] | ' | ' | ' | ' | ' | ' | ' |
Other Receivables, Net, Current | $1,342,843 | ' | ' | $1,342,843 | ' | ' | $1,342,843 |
Subsequent_Events_Details_Text
Subsequent Events (Details Textual) (Subsequent Event [Member], USD $) | 0 Months Ended | |
Jul. 03, 2014 | Jul. 15, 2014 | |
Subsequent Event [Member] | ' | ' |
Subsequent Event [Line Items] | ' | ' |
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | $446,853 | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 5,000,000 | ' |
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | ' | 100,000 |
Class of Warrant or Right, Exercise Price of Warrants or Rights | ' | $11.90 |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | ' | '24 months |