Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 25, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-40477 | ||
Entity Registrant Name | Better Choice Company Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 83-4284557 | ||
Entity Address, Address Line One | 12400 Race Track Road | ||
Entity Address, City or Town | Tampa | ||
Entity Address, State or Province | FL | ||
Entity Address, Postal Zip Code | 33626 | ||
City Area Code | (212) | ||
Local Phone Number | 896‑1254 | ||
Title of 12(b) Security | Common Stock, $0.001 par value share | ||
Trading Symbol | BTTR | ||
Security Exchange Name | NYSEAMER | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 42,128,224 | ||
Entity Common Stock, Shares Outstanding | 29,364,712 | ||
Documents Incorporated by Reference | The information required by Items 10, 11, 12, 13, and 14 will be furnished (and are hereby incorporated) by an amendment hereto or pursuant to a definitive proxy statement pursuant to Regulation 14A that will contain such information. | ||
Entity Central Index Key | 0001471727 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY |
Audit Information
Audit Information | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Audit Information [Abstract] | ||
Auditor Firm ID | 243 | 42 |
Auditor Name | BDO USA, LLP | Ernst & Young LLP |
Auditor Location | Tampa, Florida | Louisville, Kentucky |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and cash equivalents | $ 21,729 | $ 3,926 |
Restricted cash | 7,213 | 63 |
Accounts receivable, net | 6,792 | 4,631 |
Inventories, net | 5,245 | 4,869 |
Prepaid expenses and other current assets | 2,940 | 4,074 |
Total Current Assets | 43,919 | 17,563 |
Fixed assets, net | 369 | 252 |
Right-of-use assets, operating leases | 56 | 345 |
Intangible assets, net | 11,586 | 13,115 |
Goodwill | 18,614 | 18,614 |
Other assets | 116 | 1,364 |
Total Assets | 74,660 | 51,253 |
Current Liabilities | ||
Accounts payable | 4,553 | 3,137 |
Accrued and other liabilities | 1,879 | 3,400 |
Term loans, net | 855 | 7,826 |
PPP loans | 0 | 190 |
Operating lease liability | 54 | 173 |
Warrant liability | 0 | 39,850 |
Total Current Liabilities | 7,341 | 54,576 |
Non-current Liabilities | ||
Term loans, net | 4,559 | 0 |
Line of credit, net | 4,856 | 5,023 |
Deferred tax liability | 24 | 0 |
Operating lease liability | 5 | 184 |
Notes payable, net | 0 | 18,910 |
PPP loans | 0 | 662 |
Total Non-current Liabilities | 9,444 | 24,779 |
Total Liabilities | 16,785 | 79,355 |
Stockholders’ Equity (Deficit) | ||
Common Stock, $0.001 par value, 200,000,000 shares authorized, 29,146,367 & 8,651,400 shares issued and outstanding as of December 31, 2021 and 2020, respectively | 29 | 9 |
Series F Preferred Stock, $0.001 par value, 30,000 shares authorized, 0 shares & 21,754 shares issued and outstanding as of December 31, 2021 and 2020, respectively | 0 | 0 |
Additional paid-in capital | 317,102 | 232,530 |
Accumulated deficit | (259,256) | (260,641) |
Total Stockholders’ Equity (Deficit) | 57,875 | (28,102) |
Total Liabilities and Stockholders’ Equity (Deficit) | $ 74,660 | $ 51,253 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, issued (in shares) | 29,146,367 | 8,651,400 |
Common stock, outstanding (in shares) | 29,146,367 | 8,651,400 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 30,000 | 30,000 |
Preferred stock, issued (in shares) | 0 | 21,754 |
Preferred stock, outstanding (in shares) | 0 | 21,754 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | ||
Net sales | $ 46,006 | $ 42,590 |
Cost of goods sold | 30,638 | 26,485 |
Gross profit | 15,368 | 16,105 |
Operating expenses: | ||
Selling, general and administrative | 28,507 | 34,487 |
Share-based compensation | 4,140 | 8,940 |
Total operating expenses | 32,647 | 43,427 |
Loss from operations | (17,279) | (27,322) |
Other income (expense): | ||
Interest expense, net | (3,217) | (9,247) |
Gain (loss) on extinguishment of debt | 457 | (88) |
Change in fair value of warrant liabilities | 23,463 | (22,678) |
Total other income (expense), net | 20,703 | (32,013) |
Net income (loss) before income taxes | 3,424 | (59,335) |
Income tax expense | 37 | 0 |
Net income (loss) | 3,387 | (59,335) |
Preferred dividends | 0 | 103 |
Net income (loss) available to common stockholders | $ 3,387 | $ (59,438) |
Weighted average number of shares outstanding, basic (in shares) | 19,927,862 | 8,180,739 |
Weighted average number of shares outstanding, diluted (in shares) | 21,902,547 | 8,180,739 |
Income (Loss) per share, basic (in dollars per share) | $ 0.15 | $ (7.26) |
Income (Loss) per share, diluted (in dollars per share) | $ 0.14 | $ (7.26) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Private Placement | IPO | June 2020 Notes | November 2019 Notes, Seller Notes and ABG Notes | ABL Facility | Series F Preferred Stock | Series E Preferred Stock | Common Stock | Common StockPrivate Placement | Common StockIPO | Common StockSeries F Preferred Stock | Convertible Preferred StockSeries F Preferred Stock | Additional Paid-In Capital | Additional Paid-In CapitalPrivate Placement | Additional Paid-In CapitalIPO | Additional Paid-In CapitalJune 2020 Notes | Additional Paid-In CapitalNovember 2019 Notes, Seller Notes and ABG Notes | Additional Paid-In CapitalABL Facility | Additional Paid-In CapitalSeries F Preferred Stock | Accumulated Deficit | Accumulated DeficitSeries F Preferred Stock |
Beginning balance (in shares) at Dec. 31, 2019 | 7,996,232 | |||||||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ (7,071) | $ 8 | $ 194,190 | $ (201,269) | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||
Shares pursuant to private placement, IPO and Exchange Transaction (in shares) | 51,440 | 21,702 | ||||||||||||||||||||
Shares pursuant to private placement, IPO and Exchange Transaction | 500 | $ 13,916 | 500 | $ 8,501 | $ 5,415 | |||||||||||||||||
Share-based compensation (in shares) | 75,993 | |||||||||||||||||||||
Share-based compensation | 8,940 | $ 1 | 8,939 | |||||||||||||||||||
Shares and warrants issued to third party for contract termination (in shares) | 12,120 | |||||||||||||||||||||
Shares and warrants issued to third-party for contract termination | 198 | 198 | ||||||||||||||||||||
Shares issued to third-parties for services | 1,372 | 1,372 | ||||||||||||||||||||
Shares issued to third parties for services (in shares) | 193,333 | 100 | ||||||||||||||||||||
Warrants issued to third-parties for services | 10,132 | 10,132 | ||||||||||||||||||||
Warrants issued in connection with June 2020 Notes | $ 337 | $ 230 | $ 337 | $ 230 | ||||||||||||||||||
Beneficial conversion feature of June 2020 Notes | $ 1,163 | $ 1,163 | ||||||||||||||||||||
Modification of conversion feature for November 2019, Seller, and ABG Notes | $ 528 | $ 528 | ||||||||||||||||||||
Warrant modifications | 43 | 43 | ||||||||||||||||||||
Warrant exercises | 1,048 | 1,048 | ||||||||||||||||||||
Warrant exercises (in shares) | 306,282 | |||||||||||||||||||||
Conversion of Notes and Series F shares (in shares) | 16,000 | (48) | ||||||||||||||||||||
Net income (loss) available to common stockholders | (59,438) | (59,438) | ||||||||||||||||||||
Beneficial conversion feature of Series F shares | 5,349 | $ (5,349) | ||||||||||||||||||||
Ending balance at Dec. 31, 2020 | (28,102) | $ 9 | $ 0 | 232,530 | (260,641) | |||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 8,651,400 | 21,754 | ||||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 1,387,378 | |||||||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ 10,566 | |||||||||||||||||||||
Redeemable Series E Convertible Preferred Stock | ||||||||||||||||||||||
Shares issued pursuant to Series F Private Placement and Exchange Transactions (in shares) | (1,387,378) | |||||||||||||||||||||
Shares issued pursuant to Series F Private Placement and Exchange Transaction | $ (10,566) | |||||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 0 | |||||||||||||||||||||
Ending balance at Dec. 31, 2020 | $ 0 | |||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||
Shares pursuant to private placement, IPO and Exchange Transaction (in shares) | 546,733 | 8,000,000 | ||||||||||||||||||||
Shares pursuant to private placement, IPO and Exchange Transaction | $ 4,072 | $ 36,085 | $ 1 | $ 8 | $ 4,071 | $ 36,077 | ||||||||||||||||
Share-based compensation (in shares) | 17,537 | |||||||||||||||||||||
Share-based compensation | 4,140 | 4,140 | ||||||||||||||||||||
Shares issued to third-parties for services | 46 | 46 | ||||||||||||||||||||
Shares issued to third parties for services (in shares) | 5,000 | |||||||||||||||||||||
Warrant modifications | 0 | 402 | (402) | |||||||||||||||||||
Warrant exercises | 1,685 | 1,685 | ||||||||||||||||||||
Warrant exercises (in shares) | 380,716 | |||||||||||||||||||||
Conversion of Series F shares to common stock | $ 0 | $ 7 | $ (7) | |||||||||||||||||||
Conversion of Series F shares to common stock (in shares) | 7,251,205 | (21,754) | ||||||||||||||||||||
Conversion of Notes and Series F shares (in shares) | 4,732,420 | |||||||||||||||||||||
Conversion of Notes and Series F shares | 21,776 | $ 5 | 21,771 | |||||||||||||||||||
Shares issued in lieu of fractional shares due to reverse stock split (in shares) | 1,081 | |||||||||||||||||||||
Reclassification of warrant liability to equity | $ 16,387 | 16,387 | ||||||||||||||||||||
Share repurchases (in shares) | (439,725) | (439,725) | ||||||||||||||||||||
Share repurchases | $ (1,601) | $ (1) | (1,600) | |||||||||||||||||||
Net income (loss) available to common stockholders | 3,387 | 3,387 | ||||||||||||||||||||
Ending balance at Dec. 31, 2021 | $ 57,875 | $ 29 | $ 0 | $ 317,102 | $ (259,256) | |||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 29,146,367 | 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash Flow from Operating Activities: | ||
Net income (loss) available to common stockholders | $ 3,387 | $ (59,438) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Shares and warrants issued to third-parties for services | 46 | 10,330 |
Depreciation and amortization | 1,664 | 1,748 |
Amortization of debt issuance costs and discounts | 1,800 | 4,875 |
Share-based compensation | 4,140 | 8,940 |
Change in fair value of warrant liabilities | (23,463) | 22,678 |
PIK interest expense on notes payable | 1,110 | 1,998 |
Amortization of prepaid assets | 2,049 | 0 |
Other | (742) | 1,189 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (2,141) | 1,193 |
Inventories, net | (642) | 1,454 |
Prepaid expenses and other assets | 306 | (186) |
Accounts payable and accrued liabilities | 773 | (2,445) |
Other | (145) | 159 |
Cash Used in Operating Activities | (11,858) | (7,505) |
Cash Flow from Investing Activities: | ||
Capital expenditures | (353) | (151) |
Cash Used in Investing Activities | (353) | (151) |
Cash Flow from Financing Activities: | ||
Proceeds from shares and warrants issued pursuant to private placement, net | 4,012 | 18,053 |
Share repurchases | (1,601) | 0 |
Proceeds from issuance of debt | 0 | 2,352 |
Proceeds from revolving lines of credit | 5,535 | 6,624 |
Payments on revolving lines of credit | (5,883) | (6,360) |
Proceeds from term loan | 6,000 | 0 |
Payments on term loans | (8,529) | (12,521) |
Cash received for warrant exercises | 1,685 | 1,048 |
IPO proceeds, net | 36,085 | 0 |
Debt issuance costs | (140) | (85) |
Cash Provided by Financing Activities | 37,164 | 9,111 |
Net increase in cash and cash equivalents and restricted cash | 24,953 | 1,455 |
Total cash and cash equivalents and restricted cash, beginning of period | 3,989 | 2,534 |
Total cash and cash equivalents and restricted cash, end of period | 28,942 | 3,989 |
Cash paid during the year for: | ||
Income taxes | 8 | 5 |
Interest | 360 | 2,309 |
Non-cash financing and investing transactions: | ||
Stock issued for services | 0 | 1,372 |
ABL guarantor warrants | $ 0 | $ 230 |
Nature of business and summary
Nature of business and summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Nature of business and summary of significant accounting policies | Nature of business and summary of significant accounting policies Nature of the business Better Choice Company Inc. (the "Company") is a pet health and wellness company focused on providing pet products and services that help dogs and cats live healthier, happier and longer lives. The Company has a broad portfolio of pet health and wellness products for dogs and cats sold under its Halo and TruDog brands across multiple forms, including foods, treats, toppers, dental products, chews, grooming products and supplements. The products consist of kibble and canned dog and cat food, freeze-dried raw dog food and treats, vegan dog food and treats, oral care products, supplements and grooming aids. The core products sold under the Halo brand are derived from real whole meat and no rendered meat meal and include non-genetically modified fruits and vegetables. The core products sold under the TruDog brand are made according to the Company's nutritional philosophy of fresh, meat-based nutrition and minimal processing. Reverse stock split On June 28, 2021 the Company effectuated a 1-for-6 reverse stock split (the "Reverse Stock Split"). In addition, the conversion rates of the Company's outstanding preferred stock and convertible notes and the exercise prices of the Company’s underlying common stock purchase warrants and stock options were proportionately adjusted at the applicable reverse stock split ratio in accordance with the terms of such instruments. Proportionate voting rights and other rights of common stockholders were not affected by the Reverse Stock Split, other than as a result of the rounding up of fractional shares. The Company issued 1,081 shares of common stock in lieu of fractional shares in connection with the Reverse Stock Split. Accordingly, all share and per share amounts related to the Company's common stock and underlying derivatives for all periods presented in the accompanying consolidated financial statements and notes thereto have been retroactively adjusted, where applicable, to reflect the Reverse Stock Split. The number of authorized shares and the par values of the common stock and convertible preferred stock were not adjusted as a result of the Reverse Stock Split. Initial public offering The Company completed its initial public offering (the “IPO”) on July 1, 2021, in which it issued and sold 8,000,000 shares of its common stock at a price of $5.00 per share. The total net proceeds from the IPO were approximately $36.1 million, after deducting underwriting discounts and commissions of $2.8 million, and offering costs of approximately $1.1 million. These IPO costs were recorded as a reduction of stockholders' equity (deficit), and presented net of cash proceeds received in the Consolidated Statement of Cash Flows. Upon the commencement of the IPO, all of the Company's outstanding convertible notes payable automatically converted into 4,732,420 shares of common stock and upon the consummation of the IPO, all outstanding shares of the Series F convertible preferred stock were converted into 5,764,533 shares of common stock. Additionally, since the anti-dilution provision of the Series F Warrants were no longer effective upon consummation of the Company's IPO, these warrants met the requirements to be considered equity and the outstanding Series F Warrants were reclassified as such. Basis of presentation The Company’s consolidated financial statements are prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") for annual financial reports and accounting principles generally accepted in the U.S. ("GAAP"). Consolidation The financial statements are presented on a consolidated basis and include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. On an ongoing basis, the Company evaluates these assumptions, judgments and estimates. Actual results may differ from these estimates. In the opinion of management, the consolidated financial statements contain all adjustments necessary for a fair statement of the results of operations for the years ended December 31, 2021 and 2020, the financial position as of December 31, 2021 and 2020 and the cash flows for the years ended December 31, 2021 and 2020. Summary of significant accounting policies Cash and cash equivalents Cash and cash equivalents include demand deposits held with banks and highly liquid investments with original maturities of ninety days or less at acquisition date. Cash and cash equivalents are stated at cost, which approximates fair value because of the short-term nature of these instruments. The Company's cash equivalents are held in government money market funds and at times may exceed federally insured limits. For purposes of reporting cash flows, the Company considers all cash accounts that are not subject to withdrawal restrictions or penalties to be cash and cash equivalents. Restricted cash The Company was required to maintain a restricted cash balance of $7.2 million as of December 31, 2021 in connection with the amendment to the Wintrust Credit Facility (as defined below). See "Note 8 - Debt" for additional information. Accounts receivable and allowance for doubtful accounts Accounts receivable consist of unpaid buyer invoices from the Company’s customers and credit card payments receivable from third-party credit card processing companies. Accounts receivable is stated at the amount billed to customers, net of point of sale and cash discounts. The Company assesses the collectability of all receivables on an ongoing basis by considering its historical credit loss experience, current economic conditions, and other relevant factors. Based on this analysis, an allowance for doubtful accounts is recorded, and the provision is included within SG&A expense. The Company recorded a $0.1 million allowance for doubtful accounts for the years ended December 31, 2021 and 2020, respectively. Inventories Inventories, consisting of finished goods available for sale as well as packaging materials, are valued using the first-in first-out (“FIFO”) method and are recorded at the lower of cost or net realizable value. Cost is determined on a standard cost basis and includes the purchase price, as well as inbound freight costs and packaging costs. The Company regularly reviews inventory quantities on hand. Excess or obsolete reserves are established when inventory is estimated to not be sellable before expiration dates based on forecasted usage, product demand and product life cycle. Additionally, inventory valuation reflects adjustments for anticipated physical inventory losses that have occurred since the last physical inventory. Fixed Assets Fixed assets are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets, and depreciation expense is included within SG&A expense. Expenditures for normal repairs and maintenance are charged to operations as incurred. The cost of fixed assets that are retired or otherwise disposed of and the related accumulated depreciation are removed from the fixed asset accounts in the year of disposal and the resulting gain or loss is included in SG&A expense. The Company assesses potential impairments of its fixed assets whenever events or changes in circumstances indicate that the asset’s carrying value may not be recoverable. An impairment charge would be recognized when the carrying amount of the fixed asset exceeds its fair value and is not recoverable, which would occur if the carrying amount exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the fixed asset. Goodwill Goodwill is evaluated for impairment either through a qualitative or quantitative approach at least annually, or more frequently if an event occurs or circumstances change that indicate the carrying value of a reporting unit may not be recoverable. If a quantitative assessment is performed that indicates the carrying amount of a reporting unit exceeds its fair market value, an impairment loss is recognized to reduce the carrying amount to its fair market value. The fair market value is determined based on a weighting of the present value of projected future cash flows (the “income approach”) and the use of comparative market approaches (“market approach”). Factors requiring significant judgment include, among others, the assumptions related to discount rates, forecasted operating results, long-term growth rates, the determination of comparable companies and market multiples. Changes in economic and operating conditions or changes in the Company's business strategies that occur after the annual impairment analysis may impact these assumptions and result in a future goodwill impairment charge, which could be material to the Company's consolidated financial statements. Fair value measurements used in the impairment review of goodwill are Level 3 measurements. See further information about our policy for fair value measurements within this section below. See "Note 7 - Goodwill and intangible assets" for additional information regarding the goodwill impairment test. Intangible assets Intangible assets acquired are carried at cost, less accumulated amortization. The Company reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable and any not expected to be recovered through undiscounted future net cash flows are written down to current fair value. Amortization expense is included in SG&A expense. Preferred stock In accordance with FASB ASC Topic 480, “Distinguishing Liabilities from Equity (ASC 480)”, preferred stock issued with redemption provisions that are outside of the control of the Company or that contain certain redemption rights in a deemed liquidation event is required to be presented outside of Stockholders’ Equity (Deficit) on the face of the Consolidated Balance Sheets. The Company’s Redeemable Series E Convertible Preferred Stock (the “Series E”) contained redemption provisions that required it to be presented outside of Stockholders’ Equity (Deficit). The Company's Convertible Series F Preferred Stock (the "Series F") contained redemption provisions that required it to be presented within Stockholders’ Equity (Deficit). Share repurchases In August 2021, the Company's Board of Directors approved a share repurchase program that authorizes the repurchase of up to $2.0 million of the Company's outstanding common stock in the open market through December 31, 2021. Repurchased shares are immediately retired and returned to unissued status. During the year ended December 31, 2021, 439,725 shares were repurchased for $1.6 million, inclusive of broker's commissions. Common stock warrants Common stock warrants are recorded as either liabilities or as equity instruments, depending on the specific terms of the warrant agreement. Warrants classified as liabilities are revalued at each balance sheet date subsequent to the initial issuance and changes in the fair value are reflected in the Consolidated Statements of Operations as change in fair value of warrant liabilities. Upon exercise, the warrant is marked to fair value on the exercise date and the related fair value is reclassified to equity. Income taxes Income taxes are recorded in accordance with FASB ASC Topic 740, “Income Taxes (ASC 740)”, which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the consolidated financial statements and tax bases of assets and liabilities and for loss and credit carryforwards using enacted tax rates anticipated to be in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if, based upon the weight of available evidence, it is more likely than not that some or all the deferred tax assets will not be realized. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that some or all the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position, as well as consideration of the available facts and circumstances. As of December 31, 2021 and 2020, the Company does not have any significant uncertain income tax positions. If incurred, the Company would classify interest and penalties on uncertain tax positions as income tax expense. The Company was incorporated on May 6, 2019. Prior to this date, the Company operated as a flow through entity for state and U.S. federal tax purposes. The Company files a U.S. federal and state income tax return, including for its wholly owned subsidiaries. Revenue Generally, the Company's customer contracts have a single performance obligation, and revenue is recognized when the product is shipped as this is when it has been determined that control has been transferred. Amounts billed and due from customers are classified as receivables and require payment on a short-term basis and therefore do not have any significant financing components. Revenue is measured as the amount of consideration the Company expects in exchange for transferring goods, which varies with changes in trade incentives the Company offers to its customers. Trade incentives consist primarily of customer pricing allowances and merchandising funds, and point of sale discounts. Estimates of trade promotion expense and coupon redemption costs are based upon programs offered, timing of those offers, estimated redemption/usage rates from historical performance, management’s experience and current economic trends. Cost of goods sold Cost of goods sold consists primarily of the cost of product obtained from co-manufacturers, packaging materials, freight costs for shipping inventory to the warehouse, as well as third-party warehouse and order fulfillment costs. During the year ended December 31, 2021, the Company's cost of goods sold increased $4.2 million, or 16%. The increase in cost was driven by cost increases from primary suppliers as a result of broad-scale inflation in the industry. Advertising The Company charges advertising costs to expense as incurred and such charges are included in SG&A expense. The Company's advertising expenses consist primarily of specific customer promotional programs, online advertising, search costs, email advertising, and radio advertising. Advertising costs were $9.4 million and $5.8 million for the years ended December 31, 2021 and 2020, respectively. Freight Out Costs incurred for shipping and handling, including moving finished product to customers are included in SG&A expense. Shipping costs associated with moving finished products to customers were $1.8 million and $1.5 million for the years ended December 31, 2021 and 2020, respectively. Research and development Research and development costs related to developing and testing new products are expensed as incurred and included in SG&A expense. Research and development costs were $0.5 million and less than $0.1 million for the years ended December 31, 2021 and 2020, respectively. Share-based compensation Share-based compensation awards are measured at their estimated fair value on each respective grant date. The Company recognizes share-based payment expenses over the requisite service period. The Company’s share-based compensation awards are subject only to service based vesting conditions. Pursuant to ASC 718-10-35-8, the Company recognizes compensation cost for stock awards with only service conditions that have a graded vesting schedule on a straight-line basis over the service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards. Forfeitures are recognized as they occur. Operating leases We determine if a contract or arrangement meets the definition of a lease at inception. The Company has elected to make the accounting policy election for short-term leases. For leases with terms greater than 12 months, the Company records the related asset and obligation at the present value of lease payments over the term. Lease renewal options are only included in the measurement if we are reasonably certain to exercise the optional renewals. Any variable lease costs, other than those dependent upon an index or rate, are expensed as incurred. If a lease does not provide a readily available implicit rate, the Company estimates the incremental borrowing discount rate based on information available at lease commencement. The Company's only remaining operating lease as of December 31, 2021 relates to office space. There are no material residual value guarantees or material restrictive covenants. Fair value of financial instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy uses a framework which requires categorizing assets and liabilities into one of three levels based on the inputs used in valuing the asset or liability. Level 1 inputs are unadjusted, quoted market prices in active markets for identical assets or liabilities. Level 2 inputs are observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets. Level 3 inputs include unobservable inputs that are supported by little, infrequent or no market activity and reflect management’s own assumptions about inputs used in pricing the asset or liability. Level 1 provides the most reliable measure of fair value, while Level 3 generally requires significant management judgment. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s financial instruments recognized on the Consolidated Balance Sheets consist of cash and cash equivalents, restricted cash, accounts receivable, prepaid assets, accounts payable, term loans, lines of credit, subordinated convertible notes, accrued liabilities, other liabilities, and warrant liabilities. The warrant liability was remeasured at fair value each reporting period and represented a Level 3 financial instrument. The fair values for the PPP loans were deemed to be equivalent to their respective carrying values due to their relative short-term nature. The fair value for the Company’s term loans and lines of credit approximates carrying value as the instrument has a variable interest rate that approximates market rates. The fair values for the Notes Payable were determined by applying the income approach using a discounted cash flow model which primarily using unobservable inputs (Level 3). Fair value measurements of non-financial assets and non-financial liabilities reflect Level 3 inputs and are primarily used to measure the estimated fair values of goodwill, other intangible assets and long-lived assets impairment analyses. Basic and diluted income (loss) per share Basic and diluted income (loss) per share has been determined by dividing the net income (loss) available to common stockholders for the applicable period by the basic and diluted weighted average number of shares outstanding, respectively. Common stock equivalents are excluded from the computation of diluted weighted average shares outstanding when their effect is anti-dilutive. Segment information Operating segments are defined as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker ("CODM") in making decisions regarding resource allocation and assessing performance. The Company has viewed its operations and manages its business as one segment. The Company’s CODM reviews operating results on an aggregated basis. All the assets and operations of the Company are in the U.S. New Accounting Standards Recently adopted ASU 2020-03 “Codification Improvements to Financial Instruments” In March 2020, FASB issued Accounting Standards Update ("ASU") 2020-03, Codification Improvement to Financial Instruments. This ASU improves and clarifies various financial instruments topics, including the current expected credit losses standard issued in 2016. The ASU includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The amendments have different effective dates, some of which were effective for the Company beginning on January 1, 2021. The amendments adopted did not have a material impact on the Company’s consolidated financial statements. ASU 2019-12 “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”, which is intended to simplify various aspects related to accounting for income taxes. The ASU removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This new guidance was effective for the Company beginning on January 1, 2021 and did not have an impact on the Company’s consolidated financial statements. Issued but not yet adopted ASU 2016-13 “Financial Instruments – Credit Losses (Topic 326)” In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses (Topic 326),” a new standard to replace the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The standard is effective for the Company on January 1, 2023, and early adoption is permitted. The Company is currently evaluating the impact the standard will have on its consolidated financial statements and related disclosures. ASU 2020-04 “Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting” In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting". This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (IBORs) and, particularly, the risk of cessation of the London Interbank Offered Rate (LIBOR), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. The ASU can be adopted no later than December 1, 2022 with early adoption permitted. The Company is currently evaluating the impact the standard will have on its consolidated financial statements and related disclosures. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The Company records revenue net of discounts, which primarily consist of early pay discounts, general percentage allowances and contractual trade promotions. The Company excludes sales taxes collected from revenues. Retail-partner based customers are not subject to sales tax. The Company's direct-to-consumer ("DTC") loyalty program enables customers to accumulate points based on their spending. A portion of revenue is deferred at the time of sale when points are earned and recognized when the loyalty points are redeemed. Revenue channels The Company groups its revenue channels into four distinct categories: E-Commerce, which includes the sale of product to online retailers such as Amazon and Chewy; Brick & Mortar, which includes the sale of product to pet specialty chains such as Petco, PetSmart, Pet Supplies Plus, select grocery chains and neighborhood pet stores; DTC, which includes the sale of product through the Company's online web platform to more than 20,000 unique customers; and International, which includes the sale of product to foreign distribution partners and to select international retailers (transacted in U.S. dollars). Information about the Company’s net sales by revenue channel is as follows (in thousands): Twelve Months Ended December 31, 2021 2020 E-commerce (1) $ 15,091 33 % $ 14,218 34 % Brick & Mortar 6,766 15 % 8,982 21 % DTC 9,397 20 % 10,778 25 % International (2) 14,752 32 % 8,612 20 % Net Sales $ 46,006 100 % $ 42,590 100 % (1) The Company's E-Commerce channel includes two customers that each amount to greater than 10% of the Company's total net sales. These customers had $7.6 million and $7.0 million of net sales for the year ended December 31, 2021, respectively and $6.8 million and $6.9 million of net sales for the year ended December 31, 2020, respectively. (2) The Company's International channel includes $9.1 million of net sales from one customer in China that amounts to greater than 10% of the Company's total net sales for the year ended December 31, 2021. None of the Company's International customers represented greater than 10% of net sales during the year ended December 31, 2020. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are summarized as follows (in thousands): December 31, 2021 December 31, 2020 Food, treats and supplements $ 4,666 $ 4,987 Inventory packaging and supplies 1,028 596 Total Inventories 5,694 5,583 Inventory reserve (449) (714) Inventories, net $ 5,245 $ 4,869 |
Prepaid expenses and other curr
Prepaid expenses and other current assets | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid expenses and other current assets | Prepaid expenses and other current assets Prepaid expenses and other current assets are summarized as follows (in thousands): December 31, 2021 December 31, 2020 Prepaid advertising contract with iHeart (1) $ 2,095 $ 1,788 Other prepaid expenses and other current assets (2) 845 2,286 Total Prepaid expenses and other current assets $ 2,940 $ 4,074 (1) On August 28, 2019, the Company entered into a radio advertising agreement with iHeart Media + Entertainment, Inc. and issued 166,667 shares of common stock valued at $3.4 million for future advertising services. The Company issued an additional 20,834 shares valued at $0.1 million on March 5, 2020 pursuant to the agreement. The current portion of the remaining value, reflected above, is the remaining value of services that the Company expects to utilize within the twelve months following the reporting period date, unless the term is extended. There was a long-term portion of $1.2 million recorded in other non-current assets as of December 31, 2020. (2) As of December 31, 2021, this amount includes various other prepaid contracts. In December 2020, the Company entered into an agreement for access to an investment platform in exchange for 83,334 shares of common stock valued at $0.6 million and also entered into an agreement for marketing services in exchange for 83,334 shares of common stock valued at $0.5 million both of which were amortized over 12 months. |
Fixed assets
Fixed assets | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Fixed assets | Fixed assets Fixed assets consist of the following (in thousands): Estimated Useful Life December 31, 2021 December 31, 2020 Equipment 3 - 5 years $ 163 $ 234 Furniture and fixtures 2 - 5 years 179 150 Computer software, including website development 2 - 3 years 161 111 Computer equipment 2 - 3 years 72 4 Total fixed assets 575 499 Accumulated depreciation (206) (247) Fixed assets, net $ 369 $ 252 Depreciation expense was $0.1 million and $0.2 million for the years ended December 31, 2021 and 2020, respectively. |
Accrued and other liabilities
Accrued and other liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued and other liabilities | Accrued and other liabilities Accrued and other liabilities consist of the following (in thousands): December 31, 2021 December 31, 2020 Accrued taxes 139 1,009 Accrued payroll and benefits 755 913 Accrued trade promotions 119 106 Accrued interest 25 86 Deferred revenue 225 350 Other 616 936 Total accrued and other liabilities $ 1,879 $ 3,400 |
Goodwill and intangible assets
Goodwill and intangible assets | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Goodwill and intangible assets Goodwill Goodwill was $18.6 million as of December 31, 2021 and 2020, respectively. The Company performed a quantitative assessment for its annual impairment test as of October 1, 2021. Under the quantitative approach, the Company makes various estimates and assumptions to determine the estimated fair value of the reporting unit using a combination of a discounted cash flow model and earnings multiples for guideline public companies. As of December 31, 2021 and 2020, there was no accumulated impairment loss and no impairment expense related to goodwill and no indicators, events or changes in circumstances that would indicate goodwill was impaired during the period from October 2, 2021 through December 31, 2021. Intangible assets The Company’s intangible assets (in thousands) and related useful lives (in years) are as follows: December 31, 2021 December 31, 2020 Estimated Useful Life Gross Accumulated Net Carrying Accumulated Net Carrying Customer relationships 7 $ 7,190 $ (2,088) $ 5,102 $ (1,059) $ 6,131 Trade name 15 7,500 (1,016) 6,484 (516) 6,984 Total intangible assets $ 14,690 $ (3,104) $ 11,586 $ (1,575) $ 13,115 Amortization expense was $1.5 million for the years ended December 31, 2021 and 2020, respectively. The estimated future amortization of intangible assets over the remaining weighted average useful life of 9.4 years is as follows (in thousands): 2022 $ 1,527 2023 1,527 2024 1,527 2025 1,527 2026 1,494 Thereafter 3,984 $ 11,586 There were no indicators or impairment of the intangible assets as of December 31, 2021. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt The components of the Company’s debt consist of the following (in thousands): December 31, 2021 December 31, 2020 Amount Rate Maturity Amount Rate Maturity Term loan, net $ 5,414 (1) 1/6/2024 $ 7,826 (2) 1/15/2021 Line of credit, net 4,856 (1) 1/6/2024 5,023 (3) 7/5/2022 November 2019 notes payable, net (November 2019 Notes) — — % (4) 2,830 10 % 6/30/2023 December 2019 senior notes payable, net (Senior Seller Notes) — — % (4) 10,332 10 % 6/30/2023 December 2019 junior notes payable, net (Junior Seller Notes) — — % (4) 4,973 10 % 6/30/2023 ABG Notes — — % (4) 687 10 % 6/30/2023 June 2020 notes payable, net (June 2020 Notes) — — % (4) 88 10 % 6/30/2023 Halo PPP Loan — — % (5) 431 1 % 5/3/2022 TruPet PPP Loan — — % (5) 421 0.98 % 4/6/2022 Total debt 10,270 32,611 Less current portion 855 8,016 Total long-term debt $ 9,415 $ 24,595 (1) Interest at a variable rate of LIBOR plus 250 basis points with an interest rate floor of 2.50% per annum. (2) Interest at Bank of Montreal Prime plus 8.05%. (3) Interest at a variable rate of LIBOR plus 250 basis points with an interest rate floor of 3.25% per annum. (4) Converted to common stock in connection with the Company's IPO. See "Note 1 - Nature of business and summary of significant accounting policies" for additional information. (5) The Company's PPP Loans were fully forgiven during 2021. See below for additional information. Term loans and lines of credit The term loan balance of $7.8 million as of December 31, 2020 was related to the Company's prior loan facilities agreement and after the fifth amendment to that agreement was entered into on November 25, 2020, the term loan maturity date was extended to January 15, 2021. On July 16, 2020, the Company entered into a revolving line of credit with Citizens Business Bank in the aggregate amount of $7.5 million (the “ABL Facility”). The ABL Facility was scheduled to mature on July 5, 2022 and accrued interest at a variable rate of LIBOR plus 250 basis points, with an interest rate floor of 3.25% per annum. Accrued interest on the ABL Facility was payable monthly commencing on August 5, 2020. The ABL Facility provided for customary financial covenants, such as maintaining a specified adjusted EBITDA and a maximum senior debt leverage ratio, that commenced on December 31, 2020 and customary events of default, including, among others, those relating to failure to make payment, bankruptcy, breaches of representations and material adverse effects. The ABL Facility was secured by a general security interest on the assets of the Company and was personally guaranteed by a member of the Company's board of directors. The Company prepaid all the outstanding principal and accrued interest under the ABL Facility in full and did not incur any prepayment charges. As of December 31, 2020, the Company was in compliance with all debt covenant requirements and there were no events of default. On January 6, 2021, Halo entered into a credit facility with Old Plank Trail Community Bank, N.A., an affiliate of Wintrust Bank, N.A. (“Wintrust”) consisting of a $6.0 million term loan and a $6.0 million revolving line of credit, each scheduled to mature on January 6, 2024 and each bore interest at a variable rate of LIBOR plus 250 basis points, with an interest rate floor of 2.50% per annum (the "Wintrust Credit Facility"). The Second Wintrust Amendment described below updated the rate at which the Wintrust Credit Facility bears interest to the greater of the daily Federal Funds Rate plus 285 basis points, or the interest rate floor, which remained unchanged. Accrued interest on the Wintrust Credit Facility is payable monthly commencing on February 1, 2021. Principal payments are required to be made monthly on the term loan commencing February 2021 with a balloon payment upon maturity. The proceeds from the Wintrust Credit Facility were used (i) to repay outstanding principal, interest and fees under the ABL Facility and (ii) for general corporate purposes. The Company applied extinguishment accounting to the outstanding balances of the term loan and ABL Facility and recorded a loss on extinguishment of debt of $0.4 million during 2021. Debt issuance costs of $0.1 million were incurred related to the Wintrust Credit Facility. The Wintrust Credit Facility subjected the Company to certain financial covenants, including the maintenance of a fixed charge coverage ratio of no less than 1.25 to 1.00, tested as of the last day of each fiscal quarter. The numerator in the fixed charge coverage ratio was the operating cash flow of Halo, defined as Halo EBITDA less cash paid for unfinanced Halo capital expenditures, income taxes and dividends. The denominator was fixed charges such as interest expense and principal payments paid or payable on other indebtedness attributable to Halo. As of December 31, 2021, the Company failed to satisfy the fixed charge coverage ratio and entered into a default waiver agreement with Wintrust in which Wintrust waived the existing default through the next testing date, March 31, 2022. In addition, as part of the Second Wintrust Amendment described below, the financial covenants were amended to subject the Company to a minimum liquidity covenant test in lieu of a fixed charge coverage ratio which requires the Company to maintain liquidity, tested on the last day of each fiscal quarter beginning March 31, 2022, of no less than (i) $13.0 million as of the last day of each fiscal quarter ending March 31, 2022, through and including the last day of the fiscal quarter ending December 31, 2022 and (ii) $12.0 million as of the last day of the fiscal quarter ending March 31, 2023, and as of the last day of each fiscal quarter thereafter. The Wintrust Credit Facility is secured by a general guaranty and security interest on the assets, including the intellectual property, of the Company and its subsidiaries. The Company has also pledged all of the capital stock of Halo held by the Company as additional collateral. Furthermore, the Wintrust Credit Facility was supported by a collateral pledge by a member of the Company’s board of directors; as a result of the Wintrust Amendment described below, this collateral pledge was terminated and released. On August 13, 2021, Halo entered into the first amendment to the Wintrust Credit Facility (the “Wintrust Amendment”) to increase the revolving line of credit from $6.0 million to $7.5 million. The Wintrust Amendment also required Halo to secure the credit facility with a pledge of a deposit account in the amount of $7.2 million, which decreases to $6.9 million on January 1, 2022 and to $6.0 million on January 1, 2023. Additionally, on March 25, 2022, the Company entered into the second amendment to the Wintrust Credit Facility (the "Second Wintrust Amendment") which provided for the release of the Company's Bona Vida subsidiary as a guarantor, an update to the financial covenants as described above and an update to the rate at which the Wintrust Credit Facility bears interest, which is also described above. As of December 31, 2021, the term loan and line of credit outstanding under the Wintrust Credit Facility were $5.4 million and $4.9 million, respectively, net of debt issuance costs of less than $0.1 million, respectively. As of December 31, 2020, the previous term loan and line of credit outstanding were $7.8 million and $5.0 million, respectively, net of debt issuance costs and discounts of less than $0.2 million and $0.2 million, respectively. Debt issuance costs and discounts are amortized using the effective interest method. The carrying amount for the Company’s term loan and line of credit approximate fair value as the instruments have variable interest rates that approximate market rates. Notes payable On November 4, 2019, the Company issued $2.8 million of subordinated convertible notes (the “November 2019 Notes”) which carried a 10% interest rate and a maturity date of November 4, 2021. The interest was payable in kind, in arrears on March 31, June 30, September 30 and December 31 of each year. Payment in kind ("PIK") interest was payable by increasing the aggregate principal amount of the November 2019 Notes. The November 2019 Notes were convertible any time from the date of issuance and carried an initial conversion price of the lower of (a) $24.00 per share or (b) the IPO Price. The November 2019 Notes were amended on January 6, 2020. The amendment incorporated only the preferable terms of the Seller Notes as noted below, and all other terms and provisions of the November 2019 Notes remained in full force and effect. As amended, for so long as any event of default existed and was continuing, interest would accrue at the default interest rate of 12.0% per annum, and such accrued interest would be immediately due and payable. On December 19, 2019, the Company issued $10.0 million and $5.0 million in senior subordinated convertible notes (the “Senior Seller Notes”) and junior subordinated convertible notes (the “Junior Seller Notes” and together with the Senior Seller Notes, the “Seller Notes”), respectively, to the sellers of Halo. The Seller Notes were convertible any time from the date of issuance and carried a 10% interest rate and a maturity date of June 30, 2023. Interest was payable in kind, in arrears on March 31, June 30, September 30 and December 31 of each year by increasing the aggregate principal amount of the Seller Notes. The Seller Notes carried a conversion price of the lower of (a) $24.00 per share or (b) the IPO Price. On January 13, 2020, the Company issued $0.6 million in senior subordinated convertible notes to Authentic Brands and Elvis Presley Enterprises ("ABG") in connection with the termination of a previous licensing agreement (the "ABG Notes"). The terms of the ABG Notes were the same as the Seller Notes. In addition to issuing the ABG Notes, as part of the ABG termination on January 13, 2020, the Company paid ABG $0.1 million in cash, issued ABG 12,120 shares of the Company's common stock, agreed to pay ABG $0.1 million in cash in four equal installments each month from July 31, 2020 through October 31, 2020 and issued ABG 10,204 common stock purchase warrants (the "ABG Warrants") equal to a fair value of approximately $0.2 million. The total cost of the contract termination noted above was measured at its fair value of $1.1 million and included in SG&A expense. The November 2019 Notes were amended for the second time and the Seller Notes and the ABG Notes were also amended on June 24, 2020 in connection with the issuance of the June 2020 Notes, discussed below. The amendments lowered the maximum conversion price applicable to the conversion of these notes from $24.00 per share to $22.50 per share and aligned all maturity dates to be June 30, 2023. The Company accounted for the change in conversion price as a modification of the debt instruments and recognized the increase in the fair value of the conversion option as a reduction to the carrying amount of the respective debt instrument by increasing the associated debt discount or decreasing the debt premium, with a corresponding increase in Additional paid-in capital. The increase in fair value of the conversion options were $0.3 million for the November 2019 Notes, less than $0.3 million for the Seller Notes and less than $0.1 million for the ABG Notes. On June 24, 2020, the Company issued $1.5 million in subordinated convertible promissory notes (the “June 2020 Notes”) which carried a 10% interest rate and a maturity date of June 30, 2023. Interest was payable in kind, in arrears on March 31, June 30, September 30, and December 31 of each year by increasing the aggregate principal amount of the June 2020 Notes. The June 2020 Notes were convertible any time from the date of issuance and carried a conversion price of $4.50 per share. The Company evaluated the conversion option within the June 2020 Notes to determine whether the conversion price was beneficial to the note holders and recorded a beneficial conversion feature (“BCF”) related to the issuance of these notes. The BCF for the June 2020 Notes was recognized and measured by allocating a portion of the proceeds to the BCF, based on relative fair value, and as a reduction to the carrying amount of the convertible instrument equal to the intrinsic value of the conversion feature limited to the proceeds amount allocated to the instrument. The discount recorded in connection with the BCF valuation was being accreted as interest expense over the term of the June 2020 Notes, using the effective interest rate method. Upon the conversion of the June 2020 Notes, discussed below, the remaining discount of $1.4 million associated with the June 2020 Notes was fully accreted through interest expense. As of December 31, 2021, all of the Notes Payable described had $0 outstanding since they were automatically converted to common stock in connection with the Company's IPO, at a price of $5.00 per share (except for the June 2020 Notes, which were converted at a price of $4.50 per share). See "Note 1 - Nature of business and summary of significant accounting policies" for additional information. As of December 31, 2020, the November 2019 Notes outstanding were $2.8 million, net of discounts of less than $0.3 million, the Senior Seller Notes outstanding were $10.3 million, net of discounts of $0.8 million, the Junior Seller Notes outstanding were $5.0 million, net of discounts of $0.5 million, the ABG Notes outstanding were $0.7 million, including a debt premium of less than $0.1 million, and the June 2020 Notes outstanding were less than $0.1 million, net of discounts of less than $1.5 million. The debt discounts and premium were being amortized over the life of the respective notes using the effective interest method. Previously, $0.1 million of the Seller Notes were held by an executive of the Company and $2.2 million of the subordinated convertible notes were held by a member of the board of directors, all of which were converted to common stock as described above. PIK interest related to these notes was $0.1 million and $0.2 million for the years ended December 31, 2021 and 2020, respectively. PPP loans On April 10, 2020, TruPet was granted a loan from JPMorgan Chase Bank, N.A. in the aggregate amount of $0.4 million, pursuant to the Paycheck Protection Program ("PPP") under Division A, Title I of the CARES Act (the "TruPet PPP Loan"). The loan matured on April 6, 2022, and had an interest rate of 0.98% per annum, with interest and principal payable monthly commencing on November 6, 2020. During 2021, the TruPet PPP loan was fully forgiven and the Company recognized a gain on extinguishment of debt of $0.4 million. On May 7, 2020, Halo was granted a loan from Wells Fargo Bank, N.A. in the aggregate amount of $0.4 million, pursuant to the PPP (the “Halo PPP Loan”). The loan matured on May 3, 2022 and had an interest rate of 1.00% per annum, with interest and principal payable monthly, commencing on November 1, 2020. During 2021, the Halo PPP loan was fully forgiven and the Company recognized a gain on extinguishment of debt of $0.4 million. The Company recorded interest expense related to its outstanding indebtedness of $3.2 million and $9.2 million for the years ended December 31, 2021 and 2020, respectively. PIK interest relating to Notes Payable was $1.1 million and $2.0 million for the years ended December 31, 2021 and 2020, respectively. Future Debt Maturities Future debt maturities as of December 31, 2021 and for succeeding years are as follows (in thousands): Year ending December 31: 2022 $ 855 2023 $ 1,435 2024 $ 7,980 2025 $ — 2026 $ — Thereafter $ — Total $ 10,270 |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies The Company had no material purchase obligations as of December 31, 2021 or 2020. The Company may be involved in legal proceedings, claims, and regulatory, tax, or government inquiries and investigations that arise in the ordinary course of business resulting in loss contingencies. The Company accrues for loss contingencies when losses become probable and are reasonably estimable. If the reasonable estimate of the loss is a range and no amount within the range is a better estimate, the minimum amount of the range is recorded as a liability. Legal costs such as outside counsel fees and expenses are charged to expense in the period incurred and are recorded in SG&A expenses in the Consolidated Statements of Operations. The Company does not accrue for contingent losses that are considered to be reasonably possible, but not probable; however, the Company discloses the range of such reasonably possible losses. Loss contingencies considered remote are generally not disclosed. Litigation is subject to numerous uncertainties and the outcome of individual claims and contingencies is not predictable. It is possible that some legal matters for which reserves have or have not been established could result in an unfavorable outcome for the Company and any such unfavorable outcome could be of a material nature or have a material adverse effect on the Company's consolidated financial condition, results of operations and cash flows. Management is not aware of any claims or lawsuits that may have a material adverse effect on the consolidated financial position or results of operations of the Company. |
Convertible preferred stock
Convertible preferred stock | 12 Months Ended |
Dec. 31, 2021 | |
Preferred Stock, Number of Shares, Par Value and Other Disclosures [Abstract] | |
Convertible preferred stock | Convertible preferred stock During October, 2020, the Company consummated an insider-led equity financing, including the transactions contemplated by a securities purchase agreement (the “Securities Purchase Agreement”) between the Company and certain accredited and sophisticated investors (the “Purchasers”) and an exchange agreement (the “Series E Exchange Agreement”) between the Company and Cavalry Fund LP ("Cavalry"), the holder of all of the Company’s previously outstanding Series E preferred stock. Pursuant to the Securities Purchase Agreement, the Company, in a private placement (the “Series F Private Placement”), issued and sold units (the “Series F Units”) to the Purchasers for a purchase price of $1,000 per Unit. Each Unit consisted of: (i) one share of the Company’s Series F convertible preferred stock, par value $0.001 per share (the “Series F Preferred Stock”), which is convertible into shares of the Company’s common stock, par value $0.001 per share, at a value per share of common stock of $3.00; and (ii) a warrant to purchase for a six year period such number of shares of common stock (the “Series F Warrant Shares”) into which such share of Series F Preferred Stock is convertible at an exercise price per Warrant Share of $4.50. Pursuant to the Series F Private Placement, the Company raised approximately $18.2 million in gross cash proceeds, approximately $6.5 million of which was invested by certain officers, directors, employees and associated related parties thereto of the Company. The Series F Units were recorded at fair value on the date of issuance on an as converted basis. Concurrently with the execution of the Securities Purchase Agreement, the Company and the Purchasers entered into a registration rights agreement, (as amended by a certain first amendment, dated October 29,2020, the "Registration Rights Agreement") pursuant to which the Company filed a registration statement to register the Warrant Shares and the shares of common stock issuable upon conversion of the Series F Preferred Stock. In connection with the consummation of the Series F Private Placement, on October 1, 2020, the Company filed with the Secretary of State of Delaware a Certificate of Designations which authorizes a total of 30,000 shares of Series F Preferred Stock and sets forth the designations, preferences, and rights of the Company's Series F Preferred Stock. On October 1, 2020, the Company issued 14,264 Series F Units in connection with the Series F Private Placement. In addition, pursuant to the Series E Exchange Agreement, on October 1, 2020, the Company issued 3,500 Series F Units to Cavalry in exchange for all of its outstanding Series E Preferred Stock. The exchange of Series E Preferred Shares resulted in a $5.4 million gain and was recorded to Accumulated deficit on the Company's Consolidated Balance Sheets. On October 12, 2020 and October 23, 2020, the Company issued 1,106 and 2,832 Series F Units, respectively, in connection with the Series F Private Placement. In addition, on October 23, 2020, the Company issued an additional 100 shares of Series F Preferred Stock in conjunction with a marketing agreement. The Company evaluated the conversion option within the Series F Preferred Stock on the dates of issuance to determine whether the conversion price was beneficial to the holders. The Company recorded a BCF related to the issuance of the Series F Preferred Stock. The BCF was recognized and measured by allocating a portion of the proceeds to the beneficial conversion feature, based on fair value and was recorded to Accumulated deficit on the Company's Consolidated Balance Sheets limited to the proceeds amount allocated to the instrument. On July 1, 2021, all outstanding shares of convertible preferred stock were converted to common stock in connection with the consummation of the Company's IPO. See "Note 1 - Nature of business and summary of significant accounting policies" for additional information. |
Stockholders' equity (deficit)
Stockholders' equity (deficit) | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' equity (deficit) | Stockholders’ equity (deficit) On January 22, 2021, the Company consummated a private placement of common stock units (the “January 2021 Private Placement”) in which the Company raised approximately $4.1 million, including an investment by certain officers, directors, employees and associated related parties thereto of approximately $1.6 million. Each common stock unit was sold at a per unit price of $7.50 and consisted of (i) one share of the Company’s common stock, par value $0.001 per share; and (ii) a warrant to purchase one share of common stock. The proceeds were used to pay expenses related to the offering and for general corporate purposes. In connection with the January 2021 Private Placement, the Company entered into a registration rights agreement (the “January 2021 Registration Rights Agreement”) pursuant to which the Company filed a registration statement to register the shares of common stock issued, and issuable upon the exercise of the warrants issued, in the January 2021 Private Placement. See "Note 1 - Nature of business and summary of significant accounting policies" for additional information regarding the impacts to the Company's Stockholders’ equity (deficit) related to the Company's IPO. The Company has reserved common stock for future issuance as follows for the years ended December 31, 2021 and 2020: December 31, 2021 December 31, 2020 Conversion of Series F Preferred Stock — 7,251,189 Exercise of options to purchase common stock 2,684,041 1,302,574 Exercise of warrants to purchase common stock 9,433,584 9,916,997 Conversion of notes payable — 1,255,039 Total 12,117,625 19,725,799 |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Warrants | Warrants The following summarizes the Company's outstanding warrants to purchase shares of the Company's common stock as of and for the years ended December 31, 2021 and 2020: Warrants Exercise Price Warrants outstanding as of December 31, 2019 2,830,309 $ 19.38 Issued 8,321,412 $ 4.62 Exercised (322,948) $ 3.48 Terminated/Expired (911,776) $ 18.42 Warrants outstanding as of December 31, 2020 9,916,997 $ 7.32 Issued 548,110 $ 8.70 Exercised (389,881) $ 4.52 Terminated/Expired (641,642) $ 24.64 Warrants outstanding as of December 31, 2021 9,433,584 $ 5.92 The intrinsic value of outstanding warrants was $0.0 million and $23.8 million as of December 31, 2021 and 2020, respectively. The following discussion provides details on the various types of outstanding warrants and the related relevant disclosures around each type. Warrant derivative liability During May 2019, the Company acquired 118,804 warrants with a weighted average exercise price of $23.40 (the "May Acquisitions Warrants"). These warrants included an option to settle in cash in the event of a change of control of the Company and a reset feature if the Company issues shares of common stock with a strike price below the exercise price of the warrants, which required the Company to record the warrants as a derivative liability. The Company calculates the fair value of the derivative liability through a Monte Carlo Model that values the warrants based upon a probability weighted discounted cash flow model. During January 2020, the Company issued shares below the exercise price of the May Acquisitions Warrants. As such, the Company issued an additional 167,206 warrants on March 17, 2020 to certain of its warrant holders at an exercise price of $9.72 and modified the exercise price of the existing May Acquisitions Warrants to $9.72. During June 2020, the Company issued common stock equivalents below the exercise price of the warrants issued on March 17, 2020. As such, the Company issued an additional 331,771 warrants to certain of its warrant holders at an exercise price of $4.50 and modified the exercise price of the existing warrants to $4.50. During September 2020, the Company amended all of these warrants to eliminate certain anti-dilution rights, fix the number of shares of common stock purchasable under each warrant, and set the exercise price thereof at $3.90 per share. As such, the Company issued an additional 95,043 warrants to certain of its warrant holders at an exercise price of $3.90. During the fourth quarter of 2020, holders exercised a total 281,282 warrants for which the Company issued shares of common stock. During December 2020, 418,721 of these warrants expired and an immaterial amount remained outstanding as of December 31, 2020, all of which expired during January 2021. The following schedule shows the fair value of the warrant derivative liability as of December 31, 2021 and 2020, and the change in fair value during the years ended December 31, 2021 and 2020 (in thousands): Warrant Derivative Liability Balance as of December 31, 2019 $ 2,220 Change in fair value of warrant derivative liability (2,220) Balance as of December 31, 2020 $ — Change in fair value of warrant derivative liability (1) — Balance as of December 31, 2021 $ — (1) All of the May Acquisition Warrants were expired by January 2021. Series F warrant liability During October 2020, the Company issued 7,233,855 warrants to purchase common stock in connection with the Series F Private Placement with an exercise price of $4.50 (the "Series F Warrants"). The warrants are exercisable commencing on the date of issuance and expire 72 months after the date of issuance. These warrants included a reset feature if the Company issued common stock, options, or convertible securities with a strike price below the exercise price of the warrants. Upon consummation of the Company's IPO on July 1, 2021, this reset feature no longer applies. During the second quarter of 2021, a Series F warrant holder exercised 83,334 warrants, resulting in the Company's receipt of approximately $0.4 million. Initially these warrants did not meet the definition of a derivative or the requirements to be considered equity; as such, the Company recorded these as a liability. Due to changes in certain terms of the warrant agreements in connection with the Company's IPO whereby the warrants did meet the requirements to be considered equity, the outstanding Series F warrants were reclassified to equity upon consummation of the IPO on July 1, 2021. See "Note 10 - Convertible preferred stock" for more information on Series F and see "Note 1 - Nature of business and summary of significant accounting policies" for additional information on the Company's IPO. The warrant liability was remeasured at fair value each reporting period and upon the Company's IPO and represented a Level 3 financial instrument. The Company calculates the fair value of the warrant liability through a Monte Carlo Model and a Black Scholes Option Model. The total value of the consideration received in connection with the Series F Private Placement was first allocated to the warrant liability at fair value, with the remainder allocated to the preferred stock, which led to a discount ascribed to the Series F Preferred Stock. Accordingly, the Company recorded a discount of $14.6 million on the Series F Preferred Stock by adjusting Additional paid-in capital. The following schedule shows the fair value of the warrant liability upon issuance and the change in fair value during the years ended December 31, 2021 and 2020 (in thousands): Warrant liability Issuance of Series F warrants $ 14,952 Change in fair value of warrant liability 24,898 Balance as of December 31, 2020 $ 39,850 Change in fair value of warrant liability (23,463) Reclassification of warrant liability to equity (1) (16,387) Balance as of December 31, 2021 $ — (1) Reclassified to equity on July 1, 2021 in connection with the IPO. See "Note 1 - Nature of business and summary of significant accounting policies" for additional information. The following schedule shows the inputs used to measure the fair value of the warrant liability: Warrant Liability July 1, 2021 December 31, 2020 Stock Price $4.19 $7.62 Exercise Price $4.50 $4.50 Expected remaining term (in years) 5.25 - 5.31 5.75 – 5.81 Volatility 60.0% 67.5% Risk-free interest rate 0.94% 0.5% The valuation of the warrants was subject to uncertainty as a result of the unobservable inputs. If the volatility rate or risk-free interest rate were to change, the value of the warrants would be impacted. Equity-classified warrants On May 6, 2019, the Company issued 957,499 warrants to purchase common stock with an exercise price of $25.50 (the "May 2019 PIPE Warrants"). Additionally, in connection with the May 2019 PIPE transaction, the Company issued 36,757 warrants to brokers with an exercise price of $18.00. The warrants were exercisable commencing on the issuance date and expired 24 months after the issuance date. In March 2021, the Company offered to a limited number of holders the opportunity to exercise, in full or in part, these warrants to purchase shares of Common Stock at a reduced exercise price of $7.50 per share. The Company received exercise notices for a total of 174,602 warrants, resulting in the Company’s receipt of approximately $1.3 million. The Company recognized the increase in the fair value of the modified warrants on the date of exercise of $0.2 million as a deemed dividend through Accumulated deficit with a corresponding increase in Additional paid-in capital. The remainder of the outstanding and unexercised May 2019 PIPE Warrants expired during May 2021. On November 4, 2019, the Company issued 1,834 warrants in connection with the November 2019 Notes. The warrants are exercisable commencing on the date of issuance and expire 24 months from the date of the consummation of an IPO, which occurred July 1, 2021. The warrants carried an initial exercise price equal to the greater of (i) $30.00 per share or (ii) the price at which the common stock was sold in the IPO (which was $5.00). On December 19, 2019, the Company issued 1,083,334 warrants with an exercise price of $10.92 as consideration for certain directors and shareholders of the Company guaranteeing the Company's obligations under a prior credit facility agreement (the "Guarantor Warrants"), which are exercisable commencing on the date of issuance and expire 24 months from the date of the consummation of an IPO, which occurred July 1, 2021. The Guarantor Warrants had a fair value of $4.2 million on the date of issuance. On December 19, 2019, the Company issued 156,250 warrants in connection with the Seller Notes. The warrants are exercisable commencing on the date of issuance and expire 24 months from the date of the consummation of an IPO, which occurred July 1, 2021. The warrants carried an initial exercise price equal to the greater of (i) $30.00 per share or (ii) the price at which the common stock was sold in the IPO (which was $5.00). On January 13, 2020, the Company issued the ABG Warrants, which are exercisable commencing on the date of issuance and expire 24 months from the date of the consummation of an IPO, which occurred July 1, 2021 and carried an initial exercise price equal to the greater of (i) $30.00 per share or (ii) the price at which the common stock was sold in the IPO (which was $5.00). On June 24, 2020, the warrants related to the November 2019 Notes, the Seller Notes and the ABG Notes were amended in connection with the issuance of the June 2020 Notes to lower the maximum exercise price applicable to these warrants from $30.00 to $25.50 per share. The decrease in the exercise price resulted in an increase to the fair value of the warrants of $0.1 million which was recognized in SG&A expense. On June 24, 2020, the Company issued 83,334 warrants to a non-employee director and 83,334 warrants to a shareholder with an exercise price of $7.50 per share in connection with the June 2020 Notes (the “June 2020 Warrants”), which are exercisable commencing on the date of issuance and expire 84 months from the date of the consummation of an IPO, which occurred July 1, 2021. On July 20, 2020, the Company issued 50,000 warrants to a member of the board of directors with an exercise price of $6.30 per share in consideration for a personal guarantee by a member of the Company's board of directors on the ABL Facility (the "July 2020 Guarantor Warrants"), which are exercisable commencing on the date of issuance and expire 84 months from the date of the consummation of an IPO, which occurred July 1, 2021. On January 22,2021, the Company issued 548,082 warrants in connection with the January 2021 PIPE transaction. The warrants are exercisable at an exercise price per share of $8.70 commencing on the date of issuance and expire after a six year period, subject to beneficial ownership limitations (the “January 2021 Warrants”). Due to the discounted warrant exercise associated with the May 2019 PIPE warrants as discussed above, the down round provision on the January 2021 Warrants was triggered such that these warrants could be exercised at a price of $7.50 per share. The Company recognized the increase in the fair value of the modified warrants of $0.2 million as a deemed dividend through Accumulated deficit with a corresponding increase in Additional paid-in capital. Warrants issued as compensation On September 17, 2019, a Company advisor was issued 416,668 warrants with an exercise price of $0.60 per share and 250,000 warrants with an exercise price of $60.00 per share; 208,334 of the $0.60 exercise price warrants (the "Tranche 1 Warrants") were exercisable on the earlier of twelve-months after the issuance date or immediately prior to a change in control subject to the advisor’s continued service and 208,334 of the $0.60 exercise price warrants (the "Tranche 2 Warrants") and the 250,000 warrants with the $60.00 exercise price (the "Tranche 3 Warrants") were exercisable on the earlier of eighteen-months after issuance or immediately prior to a change in control subject to the advisor’s continued service. On June 1, 2020, the Company entered into a termination agreement (the “Termination Agreement”) with the advisor. Pursuant to the terms of the Termination Agreement, the Tranche 1 Warrants were amended to reduce the number of shares of common stock purchasable thereunder to 173,611 shares, and the Tranche 2 Warrants and Tranche 3 Warrants were cancelled. The Tranche 1 Warrants (as amended pursuant to the Termination Agreement) were fully vested as of the date of the termination of the agreement and remained exercisable until September 17, 2029. Furthermore, if the Company engages in any restricted business line as defined in the Termination Agreement, the Company will issue to the former advisor additional shares of common stock based on formulas intended to compensate the former advisor for the warrants that were reduced or terminated. In connection with the Termination Agreement, the Company recorded expense of $5.7 million during the year ended December 31, 2020 in SG&A expense. During the first quarter of 2021, the former advisor exercised his remaining 131,945 warrants outstanding in a cashless exercise resulting in 122,782 shares of common stock issued. On June 24, 2020, the Company issued 166,668 warrants with an exercise price of $7.50 per share to two non-employee directors, which are exercisable commencing on the date of issuance and expire 84 months from the date of the consummation of an IPO, which occurred July 1, 2021. On July 20, 2020, the Company issued 33,334 warrants to two non-employee directors at a price of $6.30 per share (the "July 2020 Director Warrants"), which are exercisable commencing on the date of issuance and expire 84 months from the date of the consummation of an IPO, which occurred July 1, 2021. The warrants issued to the non-employee directors were immediately vested and as such, the Company recorded $1.0 million of share-based compensation expense upon issuance. |
Share-based compensation
Share-based compensation | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based compensation | Share-based compensationOn November 11, 2019, the Company received shareholder approval for the Amended and Restated 2019 Incentive Award Plan (the “Amended 2019 Plan”).The Amended 2019 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, other stock or cash-based awards or a dividend equivalent award. The Amended 2019 Plan authorized the issuance of 1,083,334 shares of common stock which was increased to 1,500,000 after the Halo acquisition; the Amended 2019 Plan also provides for an annual increase on the first day of each calendar year beginning on January 1, 2020 and ending on and including January 1, 2029, equal to the lesser of (A) 10% of the shares of common stock outstanding (on an as-converted basis) on the last day of the immediately preceding fiscal year and (B) such smaller number of shares of common stock as determined by the Board. The authorized shares for issuance was increased to 2,700,000 on January 1, 2021 and again increased to 5,614,637 on January 1, 2022. Stock options The following table provides detail of the options granted and outstanding (dollars in thousands): Options Weighted Average Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Options outstanding as of December 31, 2020 1,302,503 $ 4.84 8.6 $ 4,234 Granted 1,456,408 $ 7.25 Forfeited/Expired (74,870) $ 6.53 Options outstanding as of December 31, 2021 2,684,041 $ 6.10 8.5 $ — Options exercisable as of December 31, 2021 1,267,306 $ 4.99 7.7 $ — Options granted under the Amended 2019 Plan vest over a period of two During the years ended December 31, 2021 and 2020, $4.0 million and $7.5 million, respectively, of share-based compensation expense was recognized related to options issued. As of December 31, 2021, unrecognized share-based compensation related to options was $4.5 million, which is expected to be recognized over a weighted average period of 1.1 years. The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model, using the following assumptions primarily based on historical data: Years Ended December 31, 2021 2020 Risk-free interest rate 0.36 - 1.39% 0.33 - 0.89% Expected volatility (1) 60.0% - 67.5% 67.5% Expected dividend yield —% —% Expected life (years) (2) 6.0 - 6.5 3.0 - 6.5 (1) Expected volatility was determined using a combination of historical volatility and implied volatility. (2) For certain options, the simplified method is utilized to determine the expected life due to the lack of historical data. Effective October 1, 2020, outstanding stock option awards held by employees as of October 1, 2020 were repriced concurrent with the closing of the Series F Private Placement. In total, 1,012,956 stock options were repriced. The exercise price was set at a 20% premium to the Series F Preferred Stock conversion price, or $3.60 per share. The change in exercise price of the outstanding options caused an increase in fair value of all vested options at date of repricing of $0.2 million which was expensed by the Company. The change in exercise price also caused an increase in fair value of all unvested options at date of repricing of $0.2 million. Restricted stock |
Employee benefit plans
Employee benefit plans | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Employee benefit plans | Employee benefit plansThe Company has a qualified defined contribution 401(k) plan, which covers substantially all of its employees. Participants are entitled to make pre-tax and/or Roth post-tax contributions up to the annual maximums established by the IRS. The Company matches participant contributions pursuant to the terms of the plan, which contributions are limited to a percentage of the participant’s eligible compensation. The Company made contributions related to the plan and recognized expense of less than $0.2 million during the years ended December 31, 2021 and 2020, respectively. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related party transactions | Related party transactions Notes payable The Company issued $0.8 million of subordinated convertible notes to a member of the board of directors during June 2020 and were converted to common stock upon consummation the Company's IPO on July 1, 2021. See "Note 8 - Debt" and "Note 1 - Nature of business and summary of significant accounting policies" for additional information. Guarantor warrants On June 24, 2020, the Company issued 250,000 warrants to three members of the board of directors in connection with the June 2020 Notes. On July 20, 2020, the Company issued 83,334 warrants to three members of the board of directors in connection with the ABL Facility. See "Note 12 - Warrants" for additional information. Director Fees The Company pays quarterly board of director fees. During the year ended December 31, 2021, board of director fees totaled $0.4 million. As of December 31, 2021, $0.1 million of these director fees were in accounts payable on the Consolidated Balance Sheets. During the year ended December 31, 2020, the Company recorded no board of director fees. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes For the year ended December 31, 2021, the Company recorded income tax expense of less than $0.1 million. For the year ended December 31, 2020, the Company recorded no income tax expense. For the years ended December 31, 2021 and 2020, the Company's effective tax rate was 1% and 0%, respectively. The Company’s effective tax rate differs from the U.S. federal statutory rate of 21% due to permanent differences attributable to the change in the fair value of the warrant liabilities and because the Company’s losses have been fully offset by a valuation allowance due to uncertainty of realizing the tax benefit of net operating losses (“NOLs”) for the years ended December 31, 2021 and 2020. The following table is a reconciliation of the components that caused the Company's provision for income taxes to differ from amounts computed by applying the U.S. federal statutory rate of 21% (in thousands): Years Ended December 31, 2021 2020 Statutory U.S. Federal income tax $ 719 21.0 % $ (12,482) 21.0 % State income taxes, net (650) (19.0) % (1,720) 2.9 % Change in valuation allowance 2,371 69.2 % 8,811 (14.8) % Warrant valuation (4,927) (143.9) % 4,763 (8.0) % Tax effect of non-deductible equity instruments 2,340 68.4 % 2,000 (3.4) % Return to provision adjustment 20 0.6 % (1,571) 2.6 % Other 164 4.8 % 199 (0.3) % Total provision $ 37 1.1 % $ — 0.0 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands): December 31, 2021 2020 Deferred income tax assets: Net operating loss carryforwards $ 15,049 $ 11,185 ROU assets 14 81 Share-based compensation 4,668 5,728 Inventory 106 212 Other assets 2,021 2,595 Gross deferred tax assets 21,858 19,801 Valuation allowance (19,095) (16,724) Net deferred tax assets $ 2,763 $ 3,077 Deferred income tax liabilities: Operating lease liabilities (13) (79) Intangibles (2,774) (2,998) Deferred tax liabilities, net of valuation allowance $ (24) $ — As of December 31, 2021, the Company had a deferred tax asset (before valuation allowance) recorded on gross federal and state net operating loss carryforwards of approximately $59.0 million and $53.4 million, respectively. The net operating losses will begin to expire in 2025. The Internal Revenue Code, as amended (“IRC”), imposes restrictions on the utilization of NOLs and other tax attributes in the event of an “ownership change” of a corporation. Accordingly, a company’s ability to use pre-change NOLs may be limited as prescribed under IRC Section 382. Events which may cause limitation in the amount of the NOLs and credits that can be utilized annually include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets in the future. A significant piece of objective negative evidence evaluated was the cumulative loss incurred through the years ended December 31, 2021 and 2020. Such objective evidence limits the ability to consider other subjective positive evidence such as current year taxable income and future income projections. On the basis of this evaluation, as of December 31, 2021, a valuation allowance of $19.1 million was recorded since it is more likely than not that the deferred tax assets will not be realized. Changes in valuation allowance are as follows (in thousands): Years Ended December 31, 2021 2020 Valuation allowance, at beginning of year $ 16,724 $ 7,913 Increase in valuation allowance 2,371 8,811 Valuation allowance, at end of year $ 19,095 $ 16,724 The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. The Company does not expect the impact to be material. As of December 31, 2021 and 2020, the Company does not have any significant uncertain tax positions and as of December 31, 2021 and 2020, the Company had no accrued interest and penalties related to uncertain income tax positions. The Company does not anticipate that the amount of unrecognized tax benefits will significantly increase or decrease within the next twelve months. If incurred, the Company would classify interest and penalties on uncertain tax positions as income tax expense. The Company is subject to taxation in the U.S. federal and various state jurisdictions. The Company is not currently under audit by any taxing authorities. The Company remains open to examination by tax jurisdictions for tax years beginning with the 2018 tax year for federal and 2017 for states. Federal and state net operating losses are subject to review by taxing authorities in the year utilized and future years. |
Concentrations
Concentrations | 12 Months Ended |
Dec. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Concentrations | Concentrations Major suppliers The Company sourced approximately 65% of its inventory purchases from two vendors for the year ended December 31, 2021. The Company sourced approximately 76% of its inventory purchases from three vendors for the year ended December 31, 2020. Major customers Accounts receivable from three customers represented 71% of accounts receivable as of December 31, 2021. Accounts receivable from two customers represented 72% of accounts receivable as of December 31, 2020. Three customers represented 54% of gross sales for the year ended December 31, 2021. Two customers represented 38% of gross sales for the year ended December 31, 2020. Credit risk As of December 31, 2021 and 2020, the Company’s cash and cash equivalents were deposited in accounts at several financial institutions and may maintain some balances in excess of federally insured limits. The Company maintains its cash and cash equivalents with high-quality, accredited financial institutions and, accordingly, such funds are subject to minimal credit risk. The Company has not experienced any losses historically in these accounts and believes it is not exposed to significant credit risk in its cash and cash equivalents. |
Earnings (loss) per share
Earnings (loss) per share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (loss) per share | Earnings (loss) per share The Company presents earnings (loss) per share on a basic and diluted basis. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding ("WASO") during the period. Diluted earnings (loss) per share includes the dilutive effect of common stock equivalents consisting of stock options and warrants using the treasury stock method and convertible notes and preferred stock using the if-converted method. Under the treasury stock method, the amount the holder must pay for exercising stock options or warrants and the amount of average compensation cost for future service that has not yet been recognized are collectively assumed to be used to repurchase shares. As the Company reported net income for the year ended December 31, 2021, basic and diluted net earnings per share are calculated as outlined above. For the year ended December 31, 2021, diluted WASO included 1,974,685 common stock equivalents, and 5,114,148 common stock equivalents were excluded based on the fact that their inclusion would have had an anti-dilutive effect on earnings per share. For the year ended December 31, 2020, the Company’s basic and diluted net loss per share attributable to common stockholders are the same because the Company generated a net loss and common stock equivalents are excluded from diluted net loss per share as they have an anti-dilutive impact. The following table sets forth basic and diluted net income (loss) per share attributable to common stockholders for the years ended December 31, 2021 and 2020 (in thousands, except share and per share amounts ) : Year ended December 31, 2021 2020 Numerator: Net income (loss) $ 3,387 $ (59,335) Less: Preferred stock dividends — 103 Add: Adjustment due to gain on Series E Exchange — (5,415) Less: Adjustment due to BCF of Series F Shares — 5,349 Less: Adjustment due to warrant modifications 402 — Adjusted net income (loss) available to common stockholders $ 2,985 $ (59,372) Denominator: Basic WASO 19,927,862 8,180,739 Dilutive common stock equivalents 1,974,685 — Diluted WASO 21,902,547 8,180,739 Net earnings (loss) per share attributable to common stockholders, basic $ 0.15 $ (7.26) Net earnings (loss) per share attributable to common stockholders, diluted $ 0.14 $ (7.26) |
Nature of business and summar_2
Nature of business and summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of presentation The Company’s consolidated financial statements are prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") for annual financial reports and accounting principles generally accepted in the U.S. ("GAAP"). |
Consolidation | Consolidation The financial statements are presented on a consolidated basis and include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. On an ongoing basis, the Company evaluates these assumptions, judgments and estimates. Actual results may differ from these estimates. In the opinion of management, the consolidated financial statements contain all adjustments necessary for a fair statement of the results of operations for the years ended December 31, 2021 and 2020, the financial position as of December 31, 2021 and 2020 and the cash flows for the years ended December 31, 2021 and 2020. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents include demand deposits held with banks and highly liquid investments with original maturities of ninety days or less at acquisition date. Cash and cash equivalents are stated at cost, which approximates fair value because of the short-term nature of these instruments. The Company's cash equivalents are held in government money market funds and at times may exceed federally insured limits. For purposes of reporting cash flows, the Company considers all cash accounts that are not subject to withdrawal restrictions or penalties to be cash and cash equivalents. |
Restricted cash | Restricted cashThe Company was required to maintain a restricted cash balance of $7.2 million as of December 31, 2021 in connection with the amendment to the Wintrust Credit Facility (as defined below). See "Note 8 - Debt" for additional information. |
Accounts receivable and allowance for doubtful accounts | Accounts receivable and allowance for doubtful accounts Accounts receivable consist of unpaid buyer invoices from the Company’s customers and credit card payments receivable from third-party credit card processing companies. Accounts receivable is stated at the amount billed to customers, net of point of sale and cash discounts. The Company assesses the collectability of all receivables on an ongoing basis by considering its historical credit loss experience, current economic conditions, and other relevant factors. Based on this analysis, an allowance for doubtful accounts is recorded, and the provision is included within SG&A expense. The Company recorded a $0.1 million allowance for doubtful accounts for the years ended December 31, 2021 and 2020, respectively. |
Inventories | Inventories Inventories, consisting of finished goods available for sale as well as packaging materials, are valued using the first-in first-out (“FIFO”) method and are recorded at the lower of cost or net realizable value. Cost is determined on a standard cost basis and includes the purchase price, as well as inbound freight costs and packaging costs. The Company regularly reviews inventory quantities on hand. Excess or obsolete reserves are established when inventory is estimated to not be sellable before expiration dates based on forecasted usage, product demand and product life cycle. Additionally, inventory valuation reflects adjustments for anticipated physical inventory losses that have occurred since the last physical inventory. |
Fixed Assets | Fixed Assets Fixed assets are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets, and depreciation expense is included within SG&A expense. Expenditures for normal repairs and maintenance are charged to operations as incurred. The cost of fixed assets that are retired or otherwise disposed of and the related accumulated depreciation are removed from the fixed asset accounts in the year of disposal and the resulting gain or loss is included in SG&A expense. The Company assesses potential impairments of its fixed assets whenever events or changes in circumstances indicate that the asset’s carrying value may not be recoverable. An impairment charge would be recognized when the carrying amount of the fixed asset exceeds its fair value and is not recoverable, which would occur if the carrying amount exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the fixed asset. |
Goodwill | Goodwill Goodwill is evaluated for impairment either through a qualitative or quantitative approach at least annually, or more frequently if an event occurs or circumstances change that indicate the carrying value of a reporting unit may not be recoverable. If a quantitative assessment is performed that indicates the carrying amount of a reporting unit exceeds its fair market value, an impairment loss is recognized to reduce the carrying amount to its fair market value. The fair market value is determined based on a weighting of the present value of projected future cash flows (the “income approach”) and the use of comparative market approaches (“market approach”). Factors requiring significant judgment include, among others, the assumptions related to discount rates, forecasted operating results, long-term growth rates, the determination of comparable companies and market multiples. Changes in economic and operating conditions or changes in the Company's business strategies that occur after the annual impairment analysis may impact these assumptions and result in a future goodwill impairment charge, which could be material to the Company's consolidated financial statements. Fair value measurements used in the impairment review of goodwill are Level 3 measurements. See further information about our policy for fair value measurements within this section below. See "Note 7 - Goodwill and intangible assets" for additional information regarding the goodwill impairment test. |
Intangible assets | Intangible assets Intangible assets acquired are carried at cost, less accumulated amortization. The Company reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable and any not expected to be recovered through undiscounted future net cash flows are written down to current fair value. Amortization expense is included in SG&A expense. |
Preferred stock | Preferred stock In accordance with FASB ASC Topic 480, “Distinguishing Liabilities from Equity (ASC 480)”, preferred stock issued with redemption provisions that are outside of the control of the Company or that contain certain redemption rights in a deemed liquidation event is required to be presented outside of Stockholders’ Equity (Deficit) on the face of the Consolidated Balance Sheets. The Company’s Redeemable Series E Convertible Preferred Stock (the “Series E”) contained redemption provisions that required it to be presented outside of Stockholders’ Equity (Deficit). The Company's Convertible Series F Preferred Stock (the "Series F") contained redemption provisions that required it to be presented within Stockholders’ Equity (Deficit). |
Common stock warrants | Common stock warrants Common stock warrants are recorded as either liabilities or as equity instruments, depending on the specific terms of the warrant agreement. Warrants classified as liabilities are revalued at each balance sheet date subsequent to the initial issuance and changes in the fair value are reflected in the Consolidated Statements of Operations as change in fair value of warrant liabilities. Upon exercise, the warrant is marked to fair value on the exercise date and the related fair value is reclassified to equity. |
Income taxes | Income taxes Income taxes are recorded in accordance with FASB ASC Topic 740, “Income Taxes (ASC 740)”, which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the consolidated financial statements and tax bases of assets and liabilities and for loss and credit carryforwards using enacted tax rates anticipated to be in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if, based upon the weight of available evidence, it is more likely than not that some or all the deferred tax assets will not be realized. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that some or all the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position, as well as consideration of the available facts and circumstances. As of December 31, 2021 and 2020, the Company does not have any significant uncertain income tax positions. If incurred, the Company would classify interest and penalties on uncertain tax positions as income tax expense. The Company was incorporated on May 6, 2019. Prior to this date, the Company operated as a flow through entity for state and U.S. federal tax purposes. The Company files a U.S. federal and state income tax return, including for its wholly owned subsidiaries. |
Revenue | Revenue Generally, the Company's customer contracts have a single performance obligation, and revenue is recognized when the product is shipped as this is when it has been determined that control has been transferred. Amounts billed and due from customers are classified as receivables and require payment on a short-term basis and therefore do not have any significant financing components. Revenue is measured as the amount of consideration the Company expects in exchange for transferring goods, which varies with changes in trade incentives the Company offers to its customers. Trade incentives consist primarily of customer pricing allowances and merchandising funds, and point of sale discounts. Estimates of trade promotion expense and coupon redemption costs are based upon programs offered, timing of those offers, estimated redemption/usage rates from historical performance, management’s experience and current economic trends. |
Cost of goods sold | Cost of goods sold Cost of goods sold consists primarily of the cost of product obtained from co-manufacturers, packaging materials, freight costs for shipping inventory to the warehouse, as well as third-party warehouse and order fulfillment costs. During the year ended December 31, 2021, the Company's cost of goods sold increased $4.2 million, or 16%. The increase in cost was driven by cost increases from primary suppliers as a result of broad-scale inflation in the industry. |
Advertising | AdvertisingThe Company charges advertising costs to expense as incurred and such charges are included in SG&A expense. The Company's advertising expenses consist primarily of specific customer promotional programs, online advertising, search costs, email advertising, and radio advertising. |
Freight Out | Freight Out |
Research and development | Research and developmentResearch and development costs related to developing and testing new products are expensed as incurred and included in SG&A expense. |
Share-based compensation | Share-based compensation Share-based compensation awards are measured at their estimated fair value on each respective grant date. The Company recognizes share-based payment expenses over the requisite service period. The Company’s share-based compensation awards are subject only to service based vesting conditions. Pursuant to ASC 718-10-35-8, the Company recognizes compensation cost for stock awards with only service conditions that have a graded vesting schedule on a straight-line basis over the service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards. Forfeitures are recognized as they occur. |
Operating leases | Operating leases We determine if a contract or arrangement meets the definition of a lease at inception. The Company has elected to make the accounting policy election for short-term leases. For leases with terms greater than 12 months, the Company records the related asset and obligation at the present value of lease payments over the term. Lease renewal options are only included in the measurement if we are reasonably certain to exercise the optional renewals. Any variable lease costs, other than those dependent upon an index or rate, are expensed as incurred. If a lease does not provide a readily available implicit rate, the Company estimates the incremental borrowing discount rate based on information available at lease commencement. The Company's only remaining operating lease as of December 31, 2021 relates to office space. There are no material residual value guarantees or material restrictive covenants. |
Fair value of financial instruments | Fair value of financial instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy uses a framework which requires categorizing assets and liabilities into one of three levels based on the inputs used in valuing the asset or liability. Level 1 inputs are unadjusted, quoted market prices in active markets for identical assets or liabilities. Level 2 inputs are observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets. Level 3 inputs include unobservable inputs that are supported by little, infrequent or no market activity and reflect management’s own assumptions about inputs used in pricing the asset or liability. Level 1 provides the most reliable measure of fair value, while Level 3 generally requires significant management judgment. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s financial instruments recognized on the Consolidated Balance Sheets consist of cash and cash equivalents, restricted cash, accounts receivable, prepaid assets, accounts payable, term loans, lines of credit, subordinated convertible notes, accrued liabilities, other liabilities, and warrant liabilities. The warrant liability was remeasured at fair value each reporting period and represented a Level 3 financial instrument. The fair values for the PPP loans were deemed to be equivalent to their respective carrying values due to their relative short-term nature. The fair value for the Company’s term loans and lines of credit approximates carrying value as the instrument has a variable interest rate that approximates market rates. The fair values for the Notes Payable were determined by applying the income approach using a discounted cash flow model which primarily using unobservable inputs (Level 3). Fair value measurements of non-financial assets and non-financial liabilities reflect Level 3 inputs and are primarily used to measure the estimated fair values of goodwill, other intangible assets and long-lived assets impairment analyses. |
Basic and diluted loss per share | Basic and diluted income (loss) per share Basic and diluted income (loss) per share has been determined by dividing the net income (loss) available to common stockholders for the applicable period by the basic and diluted weighted average number of shares outstanding, respectively. Common stock equivalents are excluded from the computation of diluted weighted average shares outstanding when their effect is anti-dilutive. |
Segment information | Segment information Operating segments are defined as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker ("CODM") in making decisions regarding resource allocation and assessing performance. The Company has viewed its operations and manages its business as one segment. The Company’s CODM reviews operating results on an aggregated basis. All the assets and operations of the Company are in the U.S. |
New Accounting Standards | New Accounting Standards Recently adopted ASU 2020-03 “Codification Improvements to Financial Instruments” In March 2020, FASB issued Accounting Standards Update ("ASU") 2020-03, Codification Improvement to Financial Instruments. This ASU improves and clarifies various financial instruments topics, including the current expected credit losses standard issued in 2016. The ASU includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The amendments have different effective dates, some of which were effective for the Company beginning on January 1, 2021. The amendments adopted did not have a material impact on the Company’s consolidated financial statements. ASU 2019-12 “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”, which is intended to simplify various aspects related to accounting for income taxes. The ASU removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This new guidance was effective for the Company beginning on January 1, 2021 and did not have an impact on the Company’s consolidated financial statements. Issued but not yet adopted ASU 2016-13 “Financial Instruments – Credit Losses (Topic 326)” In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses (Topic 326),” a new standard to replace the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The standard is effective for the Company on January 1, 2023, and early adoption is permitted. The Company is currently evaluating the impact the standard will have on its consolidated financial statements and related disclosures. ASU 2020-04 “Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting” In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting". This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (IBORs) and, particularly, the risk of cessation of the London Interbank Offered Rate (LIBOR), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. The ASU can be adopted no later than December 1, 2022 with early adoption permitted. The Company is currently evaluating the impact the standard will have on its consolidated financial statements and related disclosures. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Channels | Information about the Company’s net sales by revenue channel is as follows (in thousands): Twelve Months Ended December 31, 2021 2020 E-commerce (1) $ 15,091 33 % $ 14,218 34 % Brick & Mortar 6,766 15 % 8,982 21 % DTC 9,397 20 % 10,778 25 % International (2) 14,752 32 % 8,612 20 % Net Sales $ 46,006 100 % $ 42,590 100 % (1) The Company's E-Commerce channel includes two customers that each amount to greater than 10% of the Company's total net sales. These customers had $7.6 million and $7.0 million of net sales for the year ended December 31, 2021, respectively and $6.8 million and $6.9 million of net sales for the year ended December 31, 2020, respectively. (2) The Company's International channel includes $9.1 million of net sales from one customer in China that amounts to greater than 10% of the Company's total net sales for the year ended December 31, 2021. None of the Company's International customers represented greater than 10% of net sales during the year ended December 31, 2020. |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories are summarized as follows (in thousands): December 31, 2021 December 31, 2020 Food, treats and supplements $ 4,666 $ 4,987 Inventory packaging and supplies 1,028 596 Total Inventories 5,694 5,583 Inventory reserve (449) (714) Inventories, net $ 5,245 $ 4,869 |
Prepaid expenses and other cu_2
Prepaid expenses and other current assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets are summarized as follows (in thousands): December 31, 2021 December 31, 2020 Prepaid advertising contract with iHeart (1) $ 2,095 $ 1,788 Other prepaid expenses and other current assets (2) 845 2,286 Total Prepaid expenses and other current assets $ 2,940 $ 4,074 (1) On August 28, 2019, the Company entered into a radio advertising agreement with iHeart Media + Entertainment, Inc. and issued 166,667 shares of common stock valued at $3.4 million for future advertising services. The Company issued an additional 20,834 shares valued at $0.1 million on March 5, 2020 pursuant to the agreement. The current portion of the remaining value, reflected above, is the remaining value of services that the Company expects to utilize within the twelve months following the reporting period date, unless the term is extended. There was a long-term portion of $1.2 million recorded in other non-current assets as of December 31, 2020. (2) As of December 31, 2021, this amount includes various other prepaid contracts. In December 2020, the Company entered into an agreement for access to an investment platform in exchange for 83,334 shares of common stock valued at $0.6 million and also entered into an agreement for marketing services in exchange for 83,334 shares of common stock valued at $0.5 million both of which were amortized over 12 months. |
Fixed assets (Tables)
Fixed assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Fixed assets consist of the following (in thousands): Estimated Useful Life December 31, 2021 December 31, 2020 Equipment 3 - 5 years $ 163 $ 234 Furniture and fixtures 2 - 5 years 179 150 Computer software, including website development 2 - 3 years 161 111 Computer equipment 2 - 3 years 72 4 Total fixed assets 575 499 Accumulated depreciation (206) (247) Fixed assets, net $ 369 $ 252 |
Accrued and other liabilities (
Accrued and other liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued and other liabilities consist of the following (in thousands): December 31, 2021 December 31, 2020 Accrued taxes 139 1,009 Accrued payroll and benefits 755 913 Accrued trade promotions 119 106 Accrued interest 25 86 Deferred revenue 225 350 Other 616 936 Total accrued and other liabilities $ 1,879 $ 3,400 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | The Company’s intangible assets (in thousands) and related useful lives (in years) are as follows: December 31, 2021 December 31, 2020 Estimated Useful Life Gross Accumulated Net Carrying Accumulated Net Carrying Customer relationships 7 $ 7,190 $ (2,088) $ 5,102 $ (1,059) $ 6,131 Trade name 15 7,500 (1,016) 6,484 (516) 6,984 Total intangible assets $ 14,690 $ (3,104) $ 11,586 $ (1,575) $ 13,115 |
Schedule of future amortization of intangible assets | The estimated future amortization of intangible assets over the remaining weighted average useful life of 9.4 years is as follows (in thousands): 2022 $ 1,527 2023 1,527 2024 1,527 2025 1,527 2026 1,494 Thereafter 3,984 $ 11,586 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Components of debt | The components of the Company’s debt consist of the following (in thousands): December 31, 2021 December 31, 2020 Amount Rate Maturity Amount Rate Maturity Term loan, net $ 5,414 (1) 1/6/2024 $ 7,826 (2) 1/15/2021 Line of credit, net 4,856 (1) 1/6/2024 5,023 (3) 7/5/2022 November 2019 notes payable, net (November 2019 Notes) — — % (4) 2,830 10 % 6/30/2023 December 2019 senior notes payable, net (Senior Seller Notes) — — % (4) 10,332 10 % 6/30/2023 December 2019 junior notes payable, net (Junior Seller Notes) — — % (4) 4,973 10 % 6/30/2023 ABG Notes — — % (4) 687 10 % 6/30/2023 June 2020 notes payable, net (June 2020 Notes) — — % (4) 88 10 % 6/30/2023 Halo PPP Loan — — % (5) 431 1 % 5/3/2022 TruPet PPP Loan — — % (5) 421 0.98 % 4/6/2022 Total debt 10,270 32,611 Less current portion 855 8,016 Total long-term debt $ 9,415 $ 24,595 (1) Interest at a variable rate of LIBOR plus 250 basis points with an interest rate floor of 2.50% per annum. (2) Interest at Bank of Montreal Prime plus 8.05%. (3) Interest at a variable rate of LIBOR plus 250 basis points with an interest rate floor of 3.25% per annum. (4) Converted to common stock in connection with the Company's IPO. See "Note 1 - Nature of business and summary of significant accounting policies" for additional information. (5) The Company's PPP Loans were fully forgiven during 2021. See below for additional information. |
Future debt maturities | Future debt maturities as of December 31, 2021 and for succeeding years are as follows (in thousands): Year ending December 31: 2022 $ 855 2023 $ 1,435 2024 $ 7,980 2025 $ — 2026 $ — Thereafter $ — Total $ 10,270 |
Stockholders' equity (deficit)
Stockholders' equity (deficit) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Common stock for future issuance | The Company has reserved common stock for future issuance as follows for the years ended December 31, 2021 and 2020: December 31, 2021 December 31, 2020 Conversion of Series F Preferred Stock — 7,251,189 Exercise of options to purchase common stock 2,684,041 1,302,574 Exercise of warrants to purchase common stock 9,433,584 9,916,997 Conversion of notes payable — 1,255,039 Total 12,117,625 19,725,799 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of outstanding warrants and changes in fair value | The following summarizes the Company's outstanding warrants to purchase shares of the Company's common stock as of and for the years ended December 31, 2021 and 2020: Warrants Exercise Price Warrants outstanding as of December 31, 2019 2,830,309 $ 19.38 Issued 8,321,412 $ 4.62 Exercised (322,948) $ 3.48 Terminated/Expired (911,776) $ 18.42 Warrants outstanding as of December 31, 2020 9,916,997 $ 7.32 Issued 548,110 $ 8.70 Exercised (389,881) $ 4.52 Terminated/Expired (641,642) $ 24.64 Warrants outstanding as of December 31, 2021 9,433,584 $ 5.92 The following schedule shows the fair value of the warrant derivative liability as of December 31, 2021 and 2020, and the change in fair value during the years ended December 31, 2021 and 2020 (in thousands): Warrant Derivative Liability Balance as of December 31, 2019 $ 2,220 Change in fair value of warrant derivative liability (2,220) Balance as of December 31, 2020 $ — Change in fair value of warrant derivative liability (1) — Balance as of December 31, 2021 $ — (1) All of the May Acquisition Warrants were expired by January 2021. The following schedule shows the fair value of the warrant liability upon issuance and the change in fair value during the years ended December 31, 2021 and 2020 (in thousands): Warrant liability Issuance of Series F warrants $ 14,952 Change in fair value of warrant liability 24,898 Balance as of December 31, 2020 $ 39,850 Change in fair value of warrant liability (23,463) Reclassification of warrant liability to equity (1) (16,387) Balance as of December 31, 2021 $ — (1) Reclassified to equity on July 1, 2021 in connection with the IPO. See "Note 1 - Nature of business and summary of significant accounting policies" for additional information. |
Schedule of fair value measurement inputs | The following schedule shows the inputs used to measure the fair value of the warrant liability: Warrant Liability July 1, 2021 December 31, 2020 Stock Price $4.19 $7.62 Exercise Price $4.50 $4.50 Expected remaining term (in years) 5.25 - 5.31 5.75 – 5.81 Volatility 60.0% 67.5% Risk-free interest rate 0.94% 0.5% |
Share-based compensation (Table
Share-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Options granted and outstanding | The following table provides detail of the options granted and outstanding (dollars in thousands): Options Weighted Average Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Options outstanding as of December 31, 2020 1,302,503 $ 4.84 8.6 $ 4,234 Granted 1,456,408 $ 7.25 Forfeited/Expired (74,870) $ 6.53 Options outstanding as of December 31, 2021 2,684,041 $ 6.10 8.5 $ — Options exercisable as of December 31, 2021 1,267,306 $ 4.99 7.7 $ — |
Fair value assumptions | The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model, using the following assumptions primarily based on historical data: Years Ended December 31, 2021 2020 Risk-free interest rate 0.36 - 1.39% 0.33 - 0.89% Expected volatility (1) 60.0% - 67.5% 67.5% Expected dividend yield —% —% Expected life (years) (2) 6.0 - 6.5 3.0 - 6.5 (1) Expected volatility was determined using a combination of historical volatility and implied volatility. (2) For certain options, the simplified method is utilized to determine the expected life due to the lack of historical data. |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of effective income tax rate reconciliation | The following table is a reconciliation of the components that caused the Company's provision for income taxes to differ from amounts computed by applying the U.S. federal statutory rate of 21% (in thousands): Years Ended December 31, 2021 2020 Statutory U.S. Federal income tax $ 719 21.0 % $ (12,482) 21.0 % State income taxes, net (650) (19.0) % (1,720) 2.9 % Change in valuation allowance 2,371 69.2 % 8,811 (14.8) % Warrant valuation (4,927) (143.9) % 4,763 (8.0) % Tax effect of non-deductible equity instruments 2,340 68.4 % 2,000 (3.4) % Return to provision adjustment 20 0.6 % (1,571) 2.6 % Other 164 4.8 % 199 (0.3) % Total provision $ 37 1.1 % $ — 0.0 % |
Schedule of deferred tax assets and liabilities | Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands): December 31, 2021 2020 Deferred income tax assets: Net operating loss carryforwards $ 15,049 $ 11,185 ROU assets 14 81 Share-based compensation 4,668 5,728 Inventory 106 212 Other assets 2,021 2,595 Gross deferred tax assets 21,858 19,801 Valuation allowance (19,095) (16,724) Net deferred tax assets $ 2,763 $ 3,077 Deferred income tax liabilities: Operating lease liabilities (13) (79) Intangibles (2,774) (2,998) Deferred tax liabilities, net of valuation allowance $ (24) $ — |
Summary of valuation allowance | Changes in valuation allowance are as follows (in thousands): Years Ended December 31, 2021 2020 Valuation allowance, at beginning of year $ 16,724 $ 7,913 Increase in valuation allowance 2,371 8,811 Valuation allowance, at end of year $ 19,095 $ 16,724 |
Earnings (loss) per share (Tabl
Earnings (loss) per share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Basic and diluted net loss per share attributable to common stockholders | The following table sets forth basic and diluted net income (loss) per share attributable to common stockholders for the years ended December 31, 2021 and 2020 (in thousands, except share and per share amounts ) : Year ended December 31, 2021 2020 Numerator: Net income (loss) $ 3,387 $ (59,335) Less: Preferred stock dividends — 103 Add: Adjustment due to gain on Series E Exchange — (5,415) Less: Adjustment due to BCF of Series F Shares — 5,349 Less: Adjustment due to warrant modifications 402 — Adjusted net income (loss) available to common stockholders $ 2,985 $ (59,372) Denominator: Basic WASO 19,927,862 8,180,739 Dilutive common stock equivalents 1,974,685 — Diluted WASO 21,902,547 8,180,739 Net earnings (loss) per share attributable to common stockholders, basic $ 0.15 $ (7.26) Net earnings (loss) per share attributable to common stockholders, diluted $ 0.14 $ (7.26) |
Nature of business and summar_3
Nature of business and summary of significant accounting policies - Reverse stock split and Initial public offering (Details) $ / shares in Units, $ in Millions | Jul. 01, 2021USD ($)$ / sharesshares | Jun. 29, 2021shares | Jun. 28, 2021shares |
Class of Stock [Line Items] | |||
Reverse stock split, conversion ratio | 0.1667 | ||
Shares issued in lieu of fractional shares due to reverse stock split (in shares) | 1,081 | ||
IPO | |||
Class of Stock [Line Items] | |||
Sale of stock (in shares) | 8,000,000 | ||
Sale of stock, purchase price (in dollars per share) | $ / shares | $ 5 | ||
Cash proceeds | $ | $ 36.1 | ||
Underwriting discounts and commissions | $ | 2.8 | ||
Offering costs | $ | $ 1.1 | ||
Common stock issued upon conversion of convertible preferred stock (in shares) | 5,764,533 | ||
Redeemable Convertible Preferred Stock | |||
Class of Stock [Line Items] | |||
Common stock issued upon exercise (in shares) | 4,732,420 |
Nature of business and summar_4
Nature of business and summary of significant accounting policies - Restricted cash (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Restricted Cash [Abstract] | ||
Restricted cash | $ 7,213 | $ 63 |
Revolving Credit Agreement | ||
Restricted Cash [Abstract] | ||
Restricted cash | $ 7,200 |
Nature of business and summar_5
Nature of business and summary of significant accounting policies - Accounts receivable and allowance for doubtful accounts (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts | $ 0.1 | $ 0.1 |
Nature of business and summar_6
Nature of business and summary of significant accounting policies - Share repurchases (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Aug. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Share repurchase program, authorized amount | $ 2,000,000 | |
Share repurchases (in shares) | 439,725 | |
Share repurchases | $ 1,601,000 |
Nature of business and summar_7
Nature of business and summary of significant accounting policies - Cost of goods sold, Advertising, Freight out and Research and development (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | ||
Increase in cost of goods sold | $ 4.2 | |
Increase in cost of goods sold, percent | 16.00% | |
Advertising expense | $ 9.4 | $ 5.8 |
Disaggregation of Revenue [Line Items] | ||
Research and development costs | 0.5 | 0.1 |
Shipping and Handling | ||
Disaggregation of Revenue [Line Items] | ||
Cost of revenue | $ 1.8 | $ 1.5 |
Nature of business and summar_8
Nature of business and summary of significant accounting policies - Segment information (Details) | 12 Months Ended |
Dec. 31, 2021segment | |
Accounting Policies [Abstract] | |
Number of segments | 1 |
Revenue - Additional informatio
Revenue - Additional information (Details) | 12 Months Ended |
Dec. 31, 2021channel | |
Revenue from Contract with Customer [Abstract] | |
Number of revenue channels | 4 |
Revenue - Revenue channels (Det
Revenue - Revenue channels (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 46,006 | $ 42,590 |
Revenue | Sales channel concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 100.00% | 100.00% |
E-commerce | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 15,091 | $ 14,218 |
E-commerce | Customer concentration risk | Customer one | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 7,600 | 6,800 |
E-commerce | Customer concentration risk | Customer two | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 7,000 | $ 6,900 |
E-commerce | Revenue | Sales channel concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 33.00% | 34.00% |
E-commerce | Revenue | Customer concentration risk | Customer one | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 10.00% | |
E-commerce | Revenue | Customer concentration risk | Customer two | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 10.00% | |
Brick & Mortar | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 6,766 | $ 8,982 |
Brick & Mortar | Revenue | Sales channel concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 15.00% | 21.00% |
DTC | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 9,397 | $ 10,778 |
DTC | Revenue | Sales channel concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 20.00% | 25.00% |
International | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 14,752 | $ 8,612 |
International | Customer concentration risk | Customer three | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 9,100 | |
International | Revenue | Sales channel concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 32.00% | 20.00% |
International | Revenue | Customer concentration risk | Customer three | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk, percentage (greater than for 10%) | 10.00% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Food, treats and supplements | $ 4,666 | $ 4,987 |
Inventory packaging and supplies | 1,028 | 596 |
Total Inventories | 5,694 | 5,583 |
Inventory reserve | (449) | (714) |
Inventories, net | $ 5,245 | $ 4,869 |
Prepaid expenses and other cu_3
Prepaid expenses and other current assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Mar. 05, 2020 | Aug. 28, 2019 | Dec. 31, 2021 | Dec. 31, 2020 |
Prepaid Expenses and Other Current Assets [Line Items] | |||||
Prepaid advertising contract with iHeart | $ 1,788 | $ 2,095 | $ 1,788 | ||
Other prepaid expenses and other current assets | 2,286 | 845 | 2,286 | ||
Total Prepaid expenses and other current assets | 4,074 | 2,940 | 4,074 | ||
Shares issued to third-parties for services | $ 46 | 1,372 | |||
Other Noncurrent Assets | IHeartMedia | |||||
Prepaid Expenses and Other Current Assets [Line Items] | |||||
Prepaid advertising contract with iHeart | $ 1,200 | $ 1,200 | |||
Common Stock | |||||
Prepaid Expenses and Other Current Assets [Line Items] | |||||
Shares issued to third parties for services (in shares) | 5,000 | 193,333 | |||
Common Stock | IHeartMedia | |||||
Prepaid Expenses and Other Current Assets [Line Items] | |||||
Shares issued to third parties for services (in shares) | 20,834 | 166,667 | |||
Shares issued to third-parties for services | $ 100 | $ 3,400 | |||
Common Stock | Other Counterparty | Access to investment platform | |||||
Prepaid Expenses and Other Current Assets [Line Items] | |||||
Shares issued to third parties for services (in shares) | 83,334 | ||||
Shares issued to third-parties for services | $ 600 | ||||
Common Stock | Other Counterparty | Marketing services | |||||
Prepaid Expenses and Other Current Assets [Line Items] | |||||
Shares issued to third parties for services (in shares) | 83,334 | ||||
Shares issued to third-parties for services | $ 500 |
Fixed assets (Details)
Fixed assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 575 | $ 499 |
Accumulated depreciation | (206) | (247) |
Fixed assets, net | 369 | 252 |
Depreciation expense | 100 | 200 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 163 | 234 |
Equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 179 | 150 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 2 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 5 years | |
Computer software, including website development | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 161 | 111 |
Computer software, including website development | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 2 years | |
Computer software, including website development | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total fixed assets | $ 72 | $ 4 |
Computer equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 2 years | |
Computer equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years |
Accrued and other liabilities_2
Accrued and other liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accrued taxes | $ 139 | $ 1,009 |
Accrued payroll and benefits | 755 | 913 |
Accrued trade promotions | 119 | 106 |
Accrued interest | 25 | 86 |
Deferred revenue | 225 | 350 |
Other | 616 | 936 |
Total accrued and other liabilities | $ 1,879 | $ 3,400 |
Goodwill and intangible asset_2
Goodwill and intangible assets - Additional information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 18,614,000 | $ 18,614,000 |
Goodwill, accumulated impairment loss | 0 | 0 |
Goodwill, impairment expense | 0 | 0 |
Amortization expense | 1,500,000 | $ 1,500,000 |
Impairment of intangible assets | $ 0 |
Goodwill and intangible asset_3
Goodwill and intangible assets - Intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 9 years 4 months 24 days | |
Gross Carrying Amount | $ 14,690 | $ 14,690 |
Accumulated Amortization | (3,104) | (1,575) |
Net Carrying Amount | $ 11,586 | 13,115 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 7 years | |
Gross Carrying Amount | $ 7,190 | 7,190 |
Accumulated Amortization | (2,088) | (1,059) |
Net Carrying Amount | $ 5,102 | 6,131 |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 15 years | |
Gross Carrying Amount | $ 7,500 | 7,500 |
Accumulated Amortization | (1,016) | (516) |
Net Carrying Amount | $ 6,484 | $ 6,984 |
Goodwill and intangible asset_4
Goodwill and intangible assets - Estimated future amortization of amortizable intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remaining weighted average useful life | 9 years 4 months 24 days | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2022 | $ 1,527 | |
2023 | 1,527 | |
2024 | 1,527 | |
2025 | 1,527 | |
2026 | 1,494 | |
Thereafter | 3,984 | |
Net Carrying Amount | $ 11,586 | $ 13,115 |
Debt - Components of debt (Deta
Debt - Components of debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2021 | Dec. 31, 2020 | Jun. 24, 2020 | May 07, 2020 | Apr. 10, 2020 | Nov. 04, 2019 | |
Debt Instruments [Abstract] | ||||||
Long term debt | $ 10,270 | $ 32,611 | ||||
Less current portion | 855 | 8,016 | ||||
Total long term debt | 9,415 | 24,595 | ||||
Term Loan | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 5,414 | 7,826 | ||||
Bank of Montreal Prime | Term Loan | ||||||
Debt Instruments [Abstract] | ||||||
Basis spread on variable interest rate | 8.05% | |||||
LIBOR | Term Loan | ||||||
Debt Instruments [Abstract] | ||||||
Basis spread on variable interest rate | 2.50% | |||||
Floor interest rate | 2.50% | |||||
LIBOR | Line of credit | ||||||
Debt Instruments [Abstract] | ||||||
Basis spread on variable interest rate | 2.50% | |||||
November 2019 notes payable, net (November 2019 Notes) | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 2,830 | ||||
Rate | 0.00% | 10.00% | 10.00% | |||
December 2019 senior notes payable, net (Senior Seller Notes) | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 10,332 | ||||
Rate | 0.00% | 10.00% | ||||
December 2019 junior notes payable, net (Junior Seller Notes) | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 4,973 | ||||
Rate | 0.00% | 10.00% | ||||
ABG Notes | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 687 | ||||
Rate | 0.00% | 10.00% | ||||
June 2020 notes payable, net (June 2020 Notes) | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 88 | ||||
Rate | 0.00% | 10.00% | 10.00% | |||
Halo PPP Loan | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 431 | ||||
Rate | 0.00% | 1.00% | 1.00% | |||
TruPet PPP Loan | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 0 | $ 421 | ||||
Rate | 0.00% | 0.98% | 0.98% | |||
Wintrust Credit Facility | Term Loan | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 5,400 | |||||
Wintrust Credit Facility | Line of credit | ||||||
Debt Instruments [Abstract] | ||||||
Long term debt | $ 4,856 | $ 5,023 | ||||
Wintrust Credit Facility | LIBOR | Line of credit | ||||||
Debt Instruments [Abstract] | ||||||
Floor interest rate | 3.25% |
Debt - Terms loans and lines of
Debt - Terms loans and lines of credit (Details) - USD ($) | Mar. 25, 2022 | Jan. 06, 2021 | Mar. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2023 | Jan. 01, 2023 | Mar. 31, 2022 | Jan. 01, 2022 | Aug. 13, 2021 | Aug. 12, 2021 | Jul. 16, 2020 |
Debt Instruments [Abstract] | ||||||||||||
Long term debt | $ 10,270,000 | $ 32,611,000 | ||||||||||
Gain (loss) on extinguishment of debt | 457,000 | (88,000) | ||||||||||
Debt issuance costs incurred | 140,000 | 85,000 | ||||||||||
Line of credit | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Gain (loss) on extinguishment of debt | $ (400,000) | |||||||||||
Debt issuance costs and discounts | 200,000 | |||||||||||
Line of credit | Old Plank Trail Community Bank, N.A. | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Maximum borrowing capacity | $ 6,000,000 | |||||||||||
Floor interest rate | 2.50% | |||||||||||
Debt issuance costs incurred | $ 100,000 | |||||||||||
Term Loan | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Long term debt | 5,414,000 | 7,826,000 | ||||||||||
Term Loan | Old Plank Trail Community Bank, N.A. | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Maximum borrowing capacity | $ 6,000,000 | |||||||||||
Short term loan | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Debt issuance costs and discounts | $ 200,000 | |||||||||||
ABL Facility | Line of credit | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Maximum borrowing capacity | $ 7,500,000 | |||||||||||
Floor interest rate | 3.25% | |||||||||||
Wintrust Credit Facility | Line of credit | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Long term debt | $ 4,856,000 | $ 5,023,000 | ||||||||||
Maximum borrowing capacity | $ 7,500,000 | $ 6,000,000 | ||||||||||
Restricted cash | $ 7,200,000 | |||||||||||
Debt issuance costs and discounts | 100,000 | |||||||||||
Wintrust Credit Facility | Line of credit | Forecast | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Restricted cash | $ 6,000,000 | $ 6,900,000 | ||||||||||
Wintrust Credit Facility | Line of credit | Old Plank Trail Community Bank, N.A. | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Fixed charge coverage ratio | 1.25 | |||||||||||
Wintrust Credit Facility | Line of credit | Old Plank Trail Community Bank, N.A. | Forecast | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Liquidity required (no less than) | $ 12,000,000 | $ 13,000,000 | ||||||||||
Wintrust Credit Facility | Term Loan | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Long term debt | 5,400,000 | |||||||||||
Debt issuance costs and discounts | $ 100,000 | |||||||||||
LIBOR | Line of credit | Old Plank Trail Community Bank, N.A. | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Basis spread on variable interest rate | 2.50% | |||||||||||
LIBOR | Term Loan | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Basis spread on variable interest rate | 2.50% | |||||||||||
Floor interest rate | 2.50% | |||||||||||
LIBOR | ABL Facility | Line of credit | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Basis spread on variable interest rate | 2.50% | |||||||||||
LIBOR | Wintrust Credit Facility | Line of credit | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Floor interest rate | 3.25% | |||||||||||
Federal Funds Rate | Line of credit | Old Plank Trail Community Bank, N.A. | Subsequent Event | ||||||||||||
Debt Instruments [Abstract] | ||||||||||||
Basis spread on variable interest rate | 2.85% |
Debt - Notes payable (Details)
Debt - Notes payable (Details) - USD ($) | Jun. 29, 2021 | Jun. 24, 2020 | Jan. 13, 2020 | Nov. 04, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 19, 2019 |
Debt Instruments [Abstract] | |||||||||
Default interest rate | 12.00% | ||||||||
Common stock, shares issued (in shares) | 29,146,367 | 8,651,400 | |||||||
Common stock purchase warrants issued (in shares) | 9,433,584 | 9,916,997 | 2,830,309 | ||||||
Debt outstanding | $ 10,270,000 | $ 32,611,000 | |||||||
Notes payable, net | $ 0 | 18,910,000 | |||||||
Notes payable | |||||||||
Debt Instruments [Abstract] | |||||||||
Conversion price (in dollars per share) | $ 5 | ||||||||
Debt outstanding | $ 0 | ||||||||
Convertible Subordinated Seller Notes | Executive Officer | |||||||||
Debt Instruments [Abstract] | |||||||||
Notes payable, net | $ 100,000 | ||||||||
Interest expense | $ 100,000 | $ 200,000 | |||||||
Convertible Subordinated Seller Notes | Director | |||||||||
Debt Instruments [Abstract] | |||||||||
Notes payable, net | $ 800,000 | $ 2,200,000 | |||||||
Licensing arrangement | |||||||||
Debt Instruments [Abstract] | |||||||||
Termination fee paid | $ 100,000 | ||||||||
Common stock, shares issued (in shares) | 12,120 | ||||||||
Termination fee payable | $ 100,000 | ||||||||
Common stock purchase warrants issued (in shares) | 10,204 | ||||||||
Common stock purchase warrant issuable | $ 200,000 | ||||||||
Contract termination costs | 1,100,000 | ||||||||
November 2019 Notes | |||||||||
Debt Instruments [Abstract] | |||||||||
Debt face amount | $ 2,800,000 | ||||||||
Interest rate per annum | 10.00% | 0.00% | 10.00% | ||||||
Conversion price (in dollars per share) | $ 24 | ||||||||
Increase in fair value, adjustment to paid in capital | $ 300,000 | ||||||||
Debt outstanding | $ 0 | $ 2,830,000 | |||||||
Debt issuance costs and discounts | $ 300,000 | ||||||||
Seller Notes | |||||||||
Debt Instruments [Abstract] | |||||||||
Interest rate per annum | 10.00% | ||||||||
Conversion price (in dollars per share) | $ 24 | ||||||||
Increase in fair value, adjustment to paid in capital | $ 300,000 | ||||||||
Senior Seller Notes | |||||||||
Debt Instruments [Abstract] | |||||||||
Debt face amount | $ 10,000,000 | ||||||||
Interest rate per annum | 0.00% | 10.00% | |||||||
Debt outstanding | $ 0 | $ 10,332,000 | |||||||
Debt issuance costs and discounts | $ 800,000 | ||||||||
Junior Seller Notes | |||||||||
Debt Instruments [Abstract] | |||||||||
Debt face amount | $ 5,000,000 | ||||||||
Interest rate per annum | 0.00% | 10.00% | |||||||
Debt outstanding | $ 0 | $ 4,973,000 | |||||||
Debt issuance costs and discounts | $ 500,000 | ||||||||
ABG Notes | |||||||||
Debt Instruments [Abstract] | |||||||||
Debt face amount | $ 600,000 | ||||||||
Interest rate per annum | 0.00% | 10.00% | |||||||
Conversion price (in dollars per share) | $ 22.50 | $ 24 | |||||||
Increase in fair value, adjustment to paid in capital | $ 100,000 | ||||||||
Debt outstanding | $ 0 | $ 687,000 | |||||||
Debt issuance costs and discounts | $ 100,000 | ||||||||
June 2020 Notes | |||||||||
Debt Instruments [Abstract] | |||||||||
Debt face amount | $ 1,500,000 | ||||||||
Interest rate per annum | 10.00% | 0.00% | 10.00% | ||||||
Conversion price (in dollars per share) | $ 4.50 | ||||||||
Amortization of discount | $ 1,400,000 | ||||||||
Debt outstanding | $ 0 | $ 88,000 | |||||||
Debt issuance costs and discounts | $ 1,500,000 | ||||||||
June 2020 Notes | Notes payable | |||||||||
Debt Instruments [Abstract] | |||||||||
Conversion price (in dollars per share) | $ 4.50 |
Debt - PPP loans (Details)
Debt - PPP loans (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | May 07, 2020 | Apr. 10, 2020 | |
Debt Instrument [Line Items] | ||||
Debt outstanding | $ 10,270,000 | $ 32,611,000 | ||
Gain (loss) on extinguishment of debt | 457,000 | (88,000) | ||
PIK interest | 1,110,000 | 1,998,000 | ||
Paycheck Protection Loans | ||||
Debt Instrument [Line Items] | ||||
Interest expense | 3,200,000 | 9,200,000 | ||
PIK interest | $ 1,100,000 | $ 2,000,000 | ||
TruPet PPP Loan | ||||
Debt Instrument [Line Items] | ||||
Debt face amount | $ 400,000 | |||
Interest rate per annum | 0.00% | 0.98% | 0.98% | |
Debt outstanding | $ 0 | $ 421,000 | ||
Gain (loss) on extinguishment of debt | $ 400,000 | |||
Halo PPP Loan | ||||
Debt Instrument [Line Items] | ||||
Debt face amount | $ 400,000 | |||
Interest rate per annum | 0.00% | 1.00% | 1.00% | |
Debt outstanding | $ 0 | $ 431,000 | ||
Gain (loss) on extinguishment of debt | $ 400,000 |
Debt - Future debt maturities (
Debt - Future debt maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
2022 | $ 855 | |
2023 | 1,435 | |
2024 | 7,980 | |
2025 | 0 | |
2026 | 0 | |
Thereafter | 0 | |
Long term debt | $ 10,270 | $ 32,611 |
Commitments and contingencies (
Commitments and contingencies (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Purchase obligation | $ 0 | $ 0 |
Convertible preferred stock (De
Convertible preferred stock (Details) - USD ($) $ / shares in Units, $ in Millions | Oct. 23, 2020 | Oct. 12, 2020 | Oct. 01, 2020 | Oct. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Sep. 30, 2020 | Jul. 20, 2020 | Jun. 30, 2020 | Jun. 24, 2020 | Mar. 17, 2020 | Dec. 19, 2019 | Nov. 04, 2019 |
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | ||||||||||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | ||||||||||||
Warrant term | 72 months | 84 months | 24 months | 24 months | ||||||||||
Warrants, exercise price (in dollars per share) | $ 6 | $ 3.90 | $ 6.30 | $ 4.50 | $ 7.50 | $ 9.72 | $ 30 | $ 30 | ||||||
Preferred stock, authorized (in shares) | 30,000 | 30,000 | ||||||||||||
Gain on share exchange | $ 5.4 | |||||||||||||
Series F Private Placement | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Common stock, par value (in dollars per share) | $ 0.001 | |||||||||||||
Value of each share of common stock (in dollars per share) | $ 3 | |||||||||||||
Number of warrants in each unit (in shares) | 1 | |||||||||||||
Warrant term | 6 years | |||||||||||||
Warrants, exercise price (in dollars per share) | $ 4.50 | |||||||||||||
Gross proceeds | $ 18.2 | |||||||||||||
Officers and directors | Series F Private Placement | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Gross proceeds | $ 6.5 | |||||||||||||
Series F Unit | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Shares pursuant to private placement (in shares) | 14,264 | |||||||||||||
Series F Unit | Series F Private Placement | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Sale of stock, purchase price (in dollars per share) | $ 1,000 | |||||||||||||
Shares pursuant to private placement (in shares) | 2,832 | 1,106 | ||||||||||||
Series F Unit | Cavalry | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Shares pursuant to private placement (in shares) | 3,500 | |||||||||||||
Series F Preferred Stock | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, authorized (in shares) | 30,000 | |||||||||||||
Shares pursuant to private placement (in shares) | 100 | |||||||||||||
Series F Preferred Stock | Series F Private Placement | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Number of shares of stock in each unit (in shares) | 1 | |||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 |
Stockholders' equity (deficit_2
Stockholders' equity (deficit) - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 22, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Private Placement | |||
Class of Stock [Line Items] | |||
Sale of stock, consideration | $ 4.1 | ||
Sale of stock, purchase price (in dollars per share) | $ 7.50 | ||
Number of shares issuable per unit (in shares) | 1 | ||
Common stock, par value (in dollars per share) | $ 0.001 | ||
Number of warrants in each unit (in shares) | 1 | ||
Officers and directors | Private Placement | |||
Class of Stock [Line Items] | |||
Proceeds from issuance of common stock | $ 1.6 |
Stockholders' equity (deficit_3
Stockholders' equity (deficit) - Common stock reserved for issuance (Details) - shares | Dec. 31, 2021 | Dec. 31, 2020 |
Equity [Abstract] | ||
Conversion of preferred stock (in shares) | 0 | 7,251,189 |
Exercise of options to purchase common stock (in shares) | 2,684,041 | 1,302,574 |
Warrants to purchase common stock (in shares) | 9,433,584 | 9,916,997 |
Notes payable (in shares) | 0 | 1,255,039 |
Total (in shares) | 12,117,625 | 19,725,799 |
Warrants - Outstanding (Details
Warrants - Outstanding (Details) - $ / shares | Nov. 30, 2020 | Jul. 20, 2020 | Jun. 24, 2020 | Mar. 17, 2020 | Dec. 19, 2019 | Nov. 04, 2019 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Warrants | |||||||||||||
Warrants outstanding (in shares) | 9,916,997 | 2,830,309 | |||||||||||
Issued (in shares) | 66,667 | 33,334 | 166,668 | 167,206 | 156,250 | 1,834 | 95,043 | 331,771 | 548,110 | 8,321,412 | |||
Exercised (in shares) | (83,334) | (281,282) | (389,881) | (322,948) | |||||||||
Terminated/Expired (in shares) | (418,721) | (641,642) | (911,776) | ||||||||||
Warrants outstanding (in shares) | 9,916,997 | 9,916,997 | 9,433,584 | 9,916,997 | |||||||||
Exercise Price | |||||||||||||
Warrants outstanding (in dollars per share) | $ 7.32 | $ 19.38 | |||||||||||
Issued (in dollars per share) | 8.70 | 4.62 | |||||||||||
Exercised (in dollars per share) | 4.52 | 3.48 | |||||||||||
Terminated/Expired (in dollars per share) | 24.64 | 18.42 | |||||||||||
Warrants outstanding (in dollars per share) | $ 7.32 | $ 7.32 | $ 5.92 | $ 7.32 |
Warrants - Additional Informati
Warrants - Additional Information (Details) $ / shares in Units, $ in Thousands | Jan. 22, 2021USD ($)$ / sharesshares | Nov. 30, 2020USD ($)$ / sharesshares | Jul. 20, 2020USD ($)director$ / sharesshares | Jun. 24, 2020USD ($)director$ / sharesshares | Mar. 17, 2020$ / sharesshares | Dec. 19, 2019USD ($)$ / sharesshares | Nov. 04, 2019$ / sharesshares | Sep. 17, 2019$ / sharesshares | May 06, 2019$ / sharesshares | Mar. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)shares | Oct. 31, 2020USD ($)$ / sharesshares | Sep. 30, 2020$ / sharesshares | Jun. 30, 2020$ / sharesshares | May 31, 2019$ / sharesshares | Jun. 30, 2021USD ($)shares | Mar. 31, 2021shares | Dec. 31, 2020USD ($)shares | Dec. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Jul. 01, 2021$ / shares | Jun. 01, 2020shares | Jan. 13, 2020$ / shares |
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants outstanding, intrinsic value | $ | $ 23,800 | $ 23,800 | $ 0 | $ 23,800 | |||||||||||||||||||
Warrants acquired (in shares) | 118,804 | ||||||||||||||||||||||
Warrants acquired, weighted average exercise price (in dollars per share) | $ / shares | $ 23.40 | ||||||||||||||||||||||
Warrants issued (in shares) | 66,667 | 33,334 | 166,668 | 167,206 | 156,250 | 1,834 | 95,043 | 331,771 | 548,110 | 8,321,412 | |||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 6 | $ 6.30 | $ 7.50 | $ 9.72 | $ 30 | $ 30 | $ 3.90 | $ 4.50 | |||||||||||||||
Warrants, modified exercise price of existing warrants (in dollars per share) | $ / shares | $ 25.50 | $ 9.72 | $ 3.90 | $ 4.50 | |||||||||||||||||||
Warrants exercised (in shares) | 83,334 | 281,282 | 389,881 | 322,948 | |||||||||||||||||||
Warrants expired (in shares) | 418,721 | 641,642 | 911,776 | ||||||||||||||||||||
Warrant term | 72 months | 84 months | 24 months | 24 months | |||||||||||||||||||
Cash received for warrant exercises | $ | $ 400 | $ 1,685 | $ 1,048 | ||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 4.52 | $ 3.48 | |||||||||||||||||||||
Increase in fair value of warrant | $ | $ 100 | $ (23,463) | $ 22,678 | ||||||||||||||||||||
Number of warrants converted (in shares) | 173,611 | ||||||||||||||||||||||
Number of individuals received warrants | director | 2 | 2 | |||||||||||||||||||||
Director | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 83,334 | 250,000 | |||||||||||||||||||||
May 2019 PIPE | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants, modified exercise price of existing warrants (in dollars per share) | $ / shares | $ 7.50 | ||||||||||||||||||||||
Warrants exercised (in shares) | 174,602 | ||||||||||||||||||||||
Cash received for warrant exercises | $ | $ 1,300 | ||||||||||||||||||||||
Increase in fair value of warrant | $ | $ 200 | ||||||||||||||||||||||
IPO | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Sale of stock, purchase price (in dollars per share) | $ / shares | $ 5 | ||||||||||||||||||||||
January 2021 PIPE | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 548,082 | ||||||||||||||||||||||
Warrants, modified exercise price of existing warrants (in dollars per share) | $ / shares | $ 7.50 | ||||||||||||||||||||||
Warrant term | 6 years | ||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 8.70 | ||||||||||||||||||||||
Increase in fair value of warrant | $ | $ 200 | ||||||||||||||||||||||
Shareholder Guaranties | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants, fair value | $ | $ 4,200 | ||||||||||||||||||||||
General and administrative expenses | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Total cost of contract termination | $ | 5,700 | ||||||||||||||||||||||
General and administrative expense for warrants issued for services | $ | $ 100 | ||||||||||||||||||||||
Warrant Exercise Period One | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Period from issuance date after which warrants become exercisable | 12 months | ||||||||||||||||||||||
Warrant Exercise Period Two | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Period from issuance date after which warrants become exercisable | 18 months | ||||||||||||||||||||||
Exercise Price $5.00 | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 30 | ||||||||||||||||||||||
Broker | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 36,757 | ||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 18 | ||||||||||||||||||||||
Advisor | Exercise Price $0.10 | Warrant Exercise Period One | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 416,668 | ||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 0.60 | ||||||||||||||||||||||
Advisor | Exercise Price $0.10 | Warrant Exercise Period Two | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 0.60 | ||||||||||||||||||||||
Warrants exercisable (in shares) | 208,334 | ||||||||||||||||||||||
Advisor | Exercise Price $10.00 | Warrant Exercise Period One | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 250,000 | ||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 60 | ||||||||||||||||||||||
Advisor | Exercise Price $10.00 | Warrant Exercise Period Two | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 60 | ||||||||||||||||||||||
Warrants exercisable (in shares) | 250,000 | ||||||||||||||||||||||
PIPE Transaction | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 957,499 | ||||||||||||||||||||||
Warrants exercised (in dollars per share) | $ / shares | $ 25.50 | ||||||||||||||||||||||
Series F Preferred Stock | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Adjustment to additional paid-in capital for discount on preferred stock | $ | $ 14,600 | ||||||||||||||||||||||
Series F Warrants | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 7,233,855 | ||||||||||||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 4.50 | ||||||||||||||||||||||
Warrant term | 72 months | ||||||||||||||||||||||
Increase in fair value of warrant | $ | $ (23,463) | $ 24,898 | |||||||||||||||||||||
Guarantor Warrants | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 1,083,334 | ||||||||||||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 10.92 | ||||||||||||||||||||||
June 2020 Warrants | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 7.50 | ||||||||||||||||||||||
Warrant term | 84 months | ||||||||||||||||||||||
June 2020 Warrants | Director | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 83,334 | ||||||||||||||||||||||
June 2020 Warrants | Shareholder | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 83,334 | ||||||||||||||||||||||
July 2020 Guarantor Warrants | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants issued (in shares) | 50,000 | ||||||||||||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 6.30 | ||||||||||||||||||||||
Warrant term | 84 months | ||||||||||||||||||||||
Share-based compensation expense | $ | $ 1,000 | ||||||||||||||||||||||
Compensation Warrants | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants exercised (in shares) | 131,945 | ||||||||||||||||||||||
Conversion of Notes and Series F shares (in shares) | 122,782 | ||||||||||||||||||||||
Compensation Warrants | Advisor | Exercise Price $0.10 | Warrant Exercise Period One | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants exercisable (in shares) | 208,334 | ||||||||||||||||||||||
ABG Warrants | Licensing arrangement | |||||||||||||||||||||||
Class of Warrant or Right [Line Items] | |||||||||||||||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 30 |
Warrants - Fair value of warran
Warrants - Fair value of warrant liabilities (Details) - USD ($) $ in Thousands | Jun. 24, 2020 | May 06, 2019 | Oct. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2021 | Dec. 31, 2020 |
Class of Warrant or Right [Line Items] | ||||||
Balance | $ 0 | |||||
Balance as of December 31, 2019 | $ 2,220 | |||||
Change in fair value of warrant derivative liability | $ (2,220) | 0 | ||||
Change in fair value of warrant liabilities | $ 100 | (23,463) | $ 22,678 | |||
Balance | 0 | 0 | ||||
Series F Warrants | ||||||
Class of Warrant or Right [Line Items] | ||||||
Balance | 39,850 | |||||
Issuance of Series F warrants | $ 14,952 | |||||
Change in fair value of warrant liabilities | (23,463) | 24,898 | ||||
Reclassification of warrant liability to equity | (16,387) | |||||
Balance | $ 0 | $ 39,850 |
Warrants - Fair value measureme
Warrants - Fair value measurements and valuation techniques (Details) - Warrant | Dec. 31, 2021$ / shares | Jul. 01, 2021$ / shares |
Stock Price | ||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||
Derivative liability, measurement input | 7.62 | 4.19 |
Exercise Price | ||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||
Derivative liability, measurement input | 4.50 | 4.50 |
Expected remaining term | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||
Derivative liability, measurement input | 5.75 | 5.25 |
Expected remaining term | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||
Derivative liability, measurement input | 5.81 | 5.31 |
Volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||
Derivative liability, measurement input | 0.675 | 0.600 |
Risk-free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Abstract] | ||
Derivative liability, measurement input | 0.005 | 0.0094 |
Share-based compensation - Addi
Share-based compensation - Additional information (Details) $ / shares in Units, $ in Thousands | Oct. 01, 2020USD ($)$ / sharesshares | May 06, 2019shares | Mar. 31, 2020USD ($)directorshares | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Jan. 01, 2022shares | Jan. 01, 2021shares | Nov. 11, 2019shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unrecognized share-based compensation related to options | $ | $ 4,500 | |||||||
Options repriced (in shares) | 1,012,956 | |||||||
Options repriced, exercise price premium | 20.00% | |||||||
Options repriced, exercise price (in dollars per share) | $ / shares | $ 3.60 | |||||||
Options repriced, increase in fair value of vested options | $ | $ 200 | |||||||
Options repriced, increase in fair value of unvested options | $ | $ 200 | |||||||
Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Period of recognition for unrecognized share-based compensation | 1 year 1 month 6 days | |||||||
Restricted stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense | $ | $ 500 | |||||||
Number of directors received awards | director | 3 | |||||||
Restricted stock | Non-employee directors | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Awards granted (in shares) | 75,000 | |||||||
Restricted stock | Officer | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Awards granted (in shares) | 993 | |||||||
2019 Incentive Award Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Authorized issuance shares of common stock (in shares) | 1,083,334 | |||||||
Percent of common stock outstanding | 10.00% | |||||||
2019 Incentive Award Plan | Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense | $ | $ 4,000 | $ 7,500 | ||||||
Amended and Restated Incentive Award Plan 2019 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Authorized issuance shares of common stock (in shares) | 2,700,000 | 1,500,000 | ||||||
Amended and Restated Incentive Award Plan 2019 | Subsequent Event | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Authorized issuance shares of common stock (in shares) | 5,614,637 | |||||||
Minimum | Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 2 years | |||||||
Maximum | Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 3 years | |||||||
Maximum | 2019 Incentive Award Plan | Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Expiration term | 10 years |
Share-based compensation - Opti
Share-based compensation - Options granted and outstanding (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Options | ||
Options outstanding (in shares) | 1,302,503 | |
Granted (in shares) | 1,456,408 | |
Forfeited/Expired (in shares) | (74,870) | |
Options outstanding (in shares) | 2,684,041 | 1,302,503 |
Options exercisable (in shares) | 1,267,306 | |
Weighted Average Exercise Price | ||
Options outstanding (in dollars per share) | $ 4.84 | |
Granted (in dollars per share) | 7.25 | |
Forfeited/Expired (in dollars per share) | 6.53 | |
Options outstanding (in dollars per share) | 6.10 | $ 4.84 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 4.99 | |
Weighted Average Remaining Contractual Life | ||
Options outstanding, weighted average remaining contractual term | 8 years 6 months | 8 years 7 months 6 days |
Options exercisable, weighted average remaining contractual term | 7 years 8 months 12 days | |
Aggregate Intrinsic Value | ||
Options outstanding, aggregate intrinsic value | $ 0 | $ 4,234 |
Options exercisable, aggregate intrinsic value | $ 0 |
Share-based compensation - Fair
Share-based compensation - Fair value assumptions (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate, minimum | 0.36% | 0.33% |
Risk-free interest rate, maximum | 1.39% | 0.89% |
Expected volatility | 67.50% | |
Expected dividend yield | 0.00% | 0.00% |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 60.00% | |
Expected life | 6 years | 3 years |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 67.50% | |
Expected life | 6 years 6 months | 6 years 6 months |
Employee benefit plans (Details
Employee benefit plans (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Retirement Benefits [Abstract] | |
Contributions expense | $ 0.2 |
Related party transactions (Det
Related party transactions (Details) | Nov. 30, 2020shares | Jul. 20, 2020directorshares | Jun. 24, 2020directorshares | Mar. 17, 2020shares | Dec. 19, 2019shares | Nov. 04, 2019shares | Sep. 30, 2020shares | Jun. 30, 2020USD ($)shares | Dec. 31, 2021USD ($)shares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($) |
Related Party Transactions [Abstract] | |||||||||||
Subordinated convertible notes issued | $ 0 | $ 18,910,000 | |||||||||
Warrants issued (in shares) | shares | 66,667 | 33,334 | 166,668 | 167,206 | 156,250 | 1,834 | 95,043 | 331,771 | 548,110 | 8,321,412 | |
Director | |||||||||||
Related Party Transactions [Abstract] | |||||||||||
Warrants issued (in shares) | shares | 83,334 | 250,000 | |||||||||
Number of members of board of directors to whom warrants were issued | director | 3 | 3 | |||||||||
Director fees incurred | $ 400,000 | $ 0 | |||||||||
Director fees payable | $ 100,000 | ||||||||||
Convertible Subordinated Debt | Director | |||||||||||
Related Party Transactions [Abstract] | |||||||||||
Subordinated convertible notes issued | $ 800,000 | $ 2,200,000 |
Income taxes - Additional infor
Income taxes - Additional information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Current income tax expense | $ 100 | $ 0 | |
Effective tax rate | 1.10% | (0.00%) | |
Valuation allowance | $ 19,095 | $ 16,724 | $ 7,913 |
Income taxes - Effective income
Income taxes - Effective income tax rate reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Statutory U.S. Federal income tax | $ 719 | $ (12,482) |
State income taxes, net | (650) | (1,720) |
Change in valuation allowance | 2,371 | 8,811 |
Warrant valuation | (4,927) | 4,763 |
Tax effect of non-deductible equity instruments | 2,340 | 2,000 |
Return to provision adjustment | 20 | (1,571) |
Other | 164 | 199 |
Total provision | $ 37 | $ 0 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Statutory U.S. Federal income tax | 21.00% | 21.00% |
State income taxes, net | (19.00%) | 2.90% |
Change in valuation allowance | 69.20% | (14.80%) |
Warrant valuation | (143.90%) | (8.00%) |
Tax effect of non-deductible equity instruments | 68.40% | (3.40%) |
Return to provision adjustment | 0.60% | 2.60% |
Other | 4.80% | (0.30%) |
Total provision | 1.10% | (0.00%) |
Income taxes - Deferred tax ass
Income taxes - Deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred income tax assets: | |||
Net operating loss carryforwards | $ 15,049 | $ 11,185 | |
ROU assets | 14 | 81 | |
Share-based compensation | 4,668 | 5,728 | |
Inventory | 106 | 212 | |
Other assets | 2,021 | 2,595 | |
Gross deferred tax assets | 21,858 | 19,801 | |
Valuation allowance | (19,095) | (16,724) | $ (7,913) |
Net deferred tax assets | 2,763 | 3,077 | |
Deferred income tax liabilities: | |||
Operating lease liabilities | (13) | (79) | |
Intangibles | (2,774) | (2,998) | |
Deferred tax liabilities, net of valuation allowance | (24) | $ 0 | |
Domestic Tax Authority | |||
Other Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Net operating loss carryforwards | 59,000 | ||
State and Local Jurisdiction | |||
Other Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Net operating loss carryforwards | $ 53,400 |
Income taxes - Valuation allowa
Income taxes - Valuation allowance (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Valuation Allowance [Abstract] | ||
Valuation allowance, at beginning of year | $ 16,724,000 | $ 7,913,000 |
Increase in valuation allowance | 2,371,000 | 8,811,000 |
Valuation allowance, at end of year | 19,095,000 | 16,724,000 |
Accrued interest and penalties | $ 0 | $ 0 |
Concentrations (Details)
Concentrations (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Inventory purchases | Supplier Concentration Risk | Two vendors | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 65.00% | |
Inventory purchases | Supplier Concentration Risk | Three vendors | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 76.00% | |
Accounts receivable | Customer concentration risk | Three customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 71.00% | |
Accounts receivable | Customer concentration risk | Two customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 72.00% | |
Gross sales | Customer concentration risk | Three customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 54.00% | |
Gross sales | Customer concentration risk | Two customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 38.00% |
Earnings (loss) per share (Deta
Earnings (loss) per share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Net Income (Loss) Available to Common Stockholders, Basic [Abstract] | ||
Anti-dilutive common stock equivalents (in shares) | 5,114,148 | |
Numerator: | ||
Net income (loss) | $ 3,387 | $ (59,335) |
Less: Preferred stock dividends | 0 | 103 |
Add: Adjustment due to gain on Series E Exchange | 0 | (5,415) |
Less: Adjustment due to BCF of Series F Shares | 0 | 5,349 |
Less: Adjustment due to warrant modifications | 402 | 0 |
Adjusted net income (loss) available to common stockholders | 2,985 | (59,372) |
Adjusted net income (loss) available to common stockholders | $ 2,985 | $ (59,372) |
Denominator: | ||
Basic WASO (in shares) | 19,927,862 | 8,180,739 |
Dilutive common stock equivalents (in shares) | 1,974,685 | 0 |
Diluted WASO (in shares) | 21,902,547 | 8,180,739 |
Net earnings (loss) per share attributable to common stockholders, basic (in dollars per share) | $ 0.15 | $ (7.26) |
Net earnings (loss )per share attributable to common stockholders, diluted (in dollars per share) | $ 0.14 | $ (7.26) |