Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 22, 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 | 001-37480 | ||
Entity Registrant Name | UNIQUE FABRICATING, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 46-1846791 | ||
Entity Address, Address Line One | 800 Standard Parkway | ||
Entity Address, City or Town | Auburn Hills | ||
Entity Address, State or Province | MI | ||
Entity Address, Postal Zip Code | 48326 | ||
City Area Code | 248 | ||
Local Phone Number | 853-2333 | ||
Title of 12(b) Security | Common Stock, par value $.001 per share | ||
Trading Symbol | UFAB | ||
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 Common Stock, Shares Outstanding | 11,733,147 | ||
Entity Public Float | $ 28.3 | ||
Entity Central Index Key | 0001617669 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Firm ID | 34 |
Auditor Name | Deloitte & Touche LLP |
Auditor Location | Detroit, Michigan |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 742 | $ 760 |
Accounts receivable, net | 23,469 | 23,759 |
Inventories, net | 13,770 | 11,951 |
Prepaid expenses and other current assets: | ||
Prepaid expenses and other | 3,270 | 5,643 |
Refundable taxes | 3,738 | 4,027 |
Total current assets | 44,989 | 46,140 |
Property, plant, and equipment, net | 22,567 | 22,383 |
Goodwill | 16,996 | 22,111 |
Intangible assets | 5,161 | 7,605 |
Other assets: | ||
Operating leases | 9,776 | 10,415 |
Investments, at cost | 1,054 | 1,054 |
Deposits and other assets | 755 | 579 |
Deferred tax asset | 2,379 | 893 |
Total assets | 103,677 | 111,180 |
Current Liabilities: | ||
Accounts payable | 10,056 | 10,892 |
Current maturities of long-term debt | 28,884 | 35,864 |
Income taxes payable | 303 | 204 |
Revolver, current maturities | 19,541 | 11,494 |
Accrued compensation | 1,149 | 792 |
Other accrued liabilities | 3,478 | 4,551 |
Total current liabilities | 63,411 | 63,797 |
Long-term debt, net of current portion | 0 | 2,999 |
Other long-term liabilities: | ||
Other long term liabilities | 9,139 | 10,519 |
Total liabilities | 72,550 | 77,315 |
Stockholders’ Equity: | ||
Common stock, $0.001 par value – 15,000,000 shares authorized and 11,733,147 and 9,779,147 issued and outstanding at December 31, 2021 and December 31, 2020, respectively | 12 | 10 |
Additional paid-in-capital | 50,349 | 46,126 |
Accumulated deficit | (19,234) | (12,271) |
Total stockholders’ equity | 31,127 | 33,865 |
Total liabilities and stockholders’ equity | $ 103,677 | $ 111,180 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / 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, shares authorized (in shares) | 15,000,000 | 15,000,000 |
Common stock, shares issued (in shares) | 11,733,147 | 9,779,147 |
Common stock, shares outstanding (in shares) | 11,733,147 | 9,779,147 |
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 | $ 125,669 | $ 120,214 |
Cost of Sales | 108,950 | 99,543 |
Gross Profit | 16,719 | 20,671 |
Selling, general, and administrative expenses | 22,566 | 25,484 |
Impairment | 5,115 | 0 |
Restructuring expenses | 0 | 1,230 |
Operating loss | (10,962) | (6,043) |
Other income (expense) | ||
Other, net | 6,153 | 157 |
Interest expense | (3,006) | (3,608) |
Other income (expense), net | 3,147 | (3,451) |
Loss before income tax benefit | (7,815) | (9,494) |
Income tax benefit | (852) | (3,784) |
Net loss | $ (6,963) | $ (5,710) |
Net loss per share | ||
Basic (in dollars per share) | $ (0.67) | $ (0.58) |
Diluted (in dollars per share) | $ (0.67) | $ (0.58) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Beginning balance (in shares) at Dec. 29, 2019 | 9,779,147 | |||
Beginning balance at Dec. 29, 2019 | $ 39,460 | $ 10 | $ 46,011 | $ (6,561) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net loss | (5,710) | (5,710) | ||
Stock option expense | 115 | 115 | ||
Ending balance (in shares) at Dec. 31, 2020 | 9,779,147 | |||
Ending balance at Dec. 31, 2020 | 33,865 | $ 10 | 46,126 | (12,271) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net loss | (6,963) | (6,963) | ||
Stock option expense | 388 | 388 | ||
Issuance of common stock and warrants (in shares) | 1,954,000 | |||
Issuance of common stock and warrants | 3,837 | $ 2 | 3,835 | |
Ending balance (in shares) at Dec. 31, 2021 | 11,733,147 | |||
Ending balance at Dec. 31, 2021 | $ 31,127 | $ 12 | $ 50,349 | $ (19,234) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (6,963) | $ (5,710) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Impairment of goodwill | 5,115 | 0 |
Depreciation and amortization | 5,599 | 7,085 |
Amortization of debt issuance costs | 214 | 189 |
Loss (gain) on sale of assets | (12) | 464 |
Gain on forgiveness of debt | (6,000) | 0 |
Bad debt adjustment | (307) | 740 |
Loss (gain) on derivative instrument | (625) | 329 |
Stock option expense | 388 | 115 |
Accrued in-kind interest on long term debt | 121 | 0 |
Deferred income taxes | (1,486) | (1,539) |
Accounts receivable | 597 | 202 |
Inventory | (1,819) | 1,096 |
Prepaid expenses and other assets | 2,486 | (6,864) |
Accounts payable | (25) | 1,236 |
Other assets and liabilities, net | (935) | 1,287 |
Net cash used in operating activities | (3,652) | (1,370) |
Cash Flows from Investing Activities: | ||
Capital expenditures | (3,429) | (2,425) |
Proceeds from sale of property and equipment | 100 | 889 |
Net cash used in investing activities | (3,329) | (1,536) |
Cash Flows from Financing Activities: | ||
Net change in bank overdraft | (811) | 332 |
Payments on term loans and capital expenditure line | (4,200) | (3,161) |
Payments on revolving credit facilities | (42,055) | (29,576) |
Proceeds from revolving credit facilities | 49,985 | 29,573 |
Debt issuance costs | 0 | (151) |
Proceeds from PPP Note | 0 | 5,999 |
Proceeds from issuance of common stock and warrants | 4,044 | 0 |
Net cash provided by financing activities | 6,963 | 3,016 |
Cash and Cash Equivalents: | ||
Net increase (decrease) in cash and cash equivalents | (18) | 110 |
Cash and cash equivalents – beginning of period | 760 | 650 |
Cash and cash equivalents – end of period | 742 | 760 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 3,289 | 2,732 |
Cash paid for income taxes | $ 628 | $ 52 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Basis of Presentation | Nature of Business and Basis of Presentation Nature of Business Unique Fabricating, Inc. (the “Company” or “Unique”) engineers and manufactures components for customers in the transportation, appliance, medical, and consumer off-road markets. The Company’s solutions are comprised of multi-material foam, rubber, and plastic components and utilized in noise, vibration and harshness (“NVH”) management, acoustical management, water and air sealing, decorative and other functional applications. Unique leverages proprietary manufacturing processes, including die cutting, thermoforming, compression molding, fusion molding, and reaction injection molding to manufacture a wide range of products including air management products, heating ventilating and air conditioning (“HVAC”), seals, fender stuffers, air ducts, acoustical insulation, door water shields, gas tank pads, light gaskets, topper pads, mirror gaskets, glove box liners, personal protection equipment, and packaging. The Company operates as one reportable segment and is headquartered in Auburn Hills, Michigan. Basis of Presentation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Going Concern The Company’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of December 31, 2020 and March 31, 2021, the Company was in violation of its financial covenants, as defined in the Company’s Credit Agreement ( Note 9 ). The Company entered into a forbearance agreement, which allowed the Company to be able to borrow on its revolving line of credit, subject to the terms and conditions to making a revolving credit advance, including availability, and the lenders agreed, subject to the terms of the forbearance agreement, as amended, to forbear from enforcing their rights or seeking to collect payment of the Company’s debt or disposing of the collateral securing the debt. As of September 30, 2021, the Company was also in violation of the required Minimum Consolidated EBITDA covenant (as amended by the Second Amendment to the Forbearance Agreement dated September 21, 2021). On December 9, 2021, the Company entered into the Third Amendment to Forbearance Agreement with respect to the Amended and Restated Credit Agreement, as amended. The Lenders in the Third Amendment to the Forbearance Agreement, among other things, agreed to forbear with respect to the Minimum Consolidated EBITDA covenant violation and to suspend the Minimum Consolidated EBITDA covenant during the remainder of the forbearance period. The Third Amendment included a new covenant that began on December 15, 2021, which is tested weekly on a rolling basis and requires that the Company’s actual cumulative total cash disbursements for the period being tested not exceed total cash disbursements projected by the Company for the same period by more than 15% at any time during the forbearance period. The Third Amendment also reduced the Revolving Credit Aggregate Commitment from $27 million to $25 million. As of December 31, 2021, the Company was in violation of the required Minimum Liquidity covenant, as provided in the Second Amendment to the Forbearance Agreement. As a result, on February 4, 2022, the Company entered into the Fourth Amendment to Forbearance Agreement. The Lenders in the Fourth Amendment to the Forbearance Agreement agreed to waive the Minimum Liquidity covenant violation. The defaults, if not waived by our lenders, allows the lenders to accelerate the maturity of the debt, making it immediately due and payable. Accordingly, all debt subject to the Credit Agreement, totaling $48.4 million, has been classified as current as of December 31, 2021. The Company does not have sufficient cash and cash equivalents on hand or available liquidity to repay such debt or meet its obligations as they become due through twelve months from date of issuance of these consolidated financial statements. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. In response to these conditions, the Company is discussing with its bank lenders entering into an amendment and waiver to cure the covenant defaults. There is not any assurance that the lenders will waive such non compliance or agree to an amendment to the current provisions. Even if the lenders were to agree to waive the failures to comply as of December 31, 2020, March 31, 2021, and September 30, 2021, there cannot be any assurance that, at any future date at which compliance is measured, we will be able to comply with the covenants contained in the forbearance agreement, as amended, given the industry-wide and other challenges that we face, as described elsewhere herein, or that our lenders would waive a default if that were to occur. Furthermore, there can be no assurance that the Company will be able to enter into an amendment or waiver with the lenders or if it enters into an amendment, what the terms, restrictions, and covenants of the amendment will contain. These plans have not been finalized and are not within the Company’s control, and therefore cannot be deemed probable. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty. Private Placement of Securities On September 21, 2021, the Company issued 1,954,000 shares of common stock at a price of $2.25 per share for gross proceeds of $4.4 million in an offering exempt from registration under the Securities Act of 1933, as amended. The Company received net proceeds of approximately $4.0 million after payment of selling commissions equal to 8% of the gross proceeds to Taglich Brothers, Inc., the placement agent for the Offering. Further, the Company paid the placement agent’s Offering expenses of $44,000. Taglich Brothers, Inc. also received warrants to purchase 156,320 shares of common stock, exercisable for five years, at a price per share of $3.12 (the “Warrants”). The Company used the net proceeds for general corporate purposes and reduced borrowings under its revolving credit facility, which subject to availability and compliance with the terms of the revolving line of credit, as amended, including by the Forbearance Agreement, may be reborrowed by the Company. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Principles of Consolidation. The consolidated financial statements include the accounts of the Company and all subsidiaries over which the Company exercises control. All inter-company transactions and balances have been eliminated upon consolidation. Cash and Cash Equivalents. The Company considers all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. The carrying value of cash and cash equivalents approximate fair value. Accounts Receivable . Accounts receivable are stated at the invoiced amount and do not bear interest. The allowance for doubtful accounts is management’s best estimate of the amount of probable collection in full of the existing accounts receivable. Management determines the allowance based on historical write off experience and an understanding of individual customer payment history and financial condition. Management reviews the allowance for doubtful accounts at regular intervals. Account balances are charged off against the allowance when management determines it is probable the receivable will not be recovered. The allowance for doubtful accounts was $1.3 million at December 31, 2021 and $1.2 million at December 31, 2020. Inventories. Inventories are stated at the lower of cost or net realizable value, with cost determined on the first in, first out method (FIFO). The value of inventories is reduced for excess and obsolescence based on management's review of on-hand inventories compared to historical and estimated future sales and usage. The allowance for inventory valuation was $1.2 million and $0.4 million at December 31, 2021 and December 31, 2020, respectively. Valuation of Long-Lived Assets. The carrying value of long-lived assets held for use is periodically evaluated when events or circumstances warrant such a review. The carrying value of a long-lived asset held for use is considered impaired when the anticipated separately identifiable undiscounted cash flows from the asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. During the third quarter of 2021, the Company identified indicators of impairment, the most impactful being the decline in sales to our automotive customers, as North American automotive production volumes continued to decrease. The Company compared the carrying value of long-lived assets (excluding goodwill) to the cumulative undiscounted cash flows and concluded no assets other than goodwill were impaired. The Company determined that no impairment indicators were evident, and all originally assigned useful lives remained appropriate during the year ended December 31, 2020. Property, Plant, and Equipment. Property, plant, and equipment purchases are recorded at cost. Depreciation is calculated using the straight-line method over the estimated useful life of each asset. Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the period of the related leases. Upon retirement or disposal, the initial cost or valuation and accumulated depreciation are removed from the accounts, and any gain or loss is included in the statement of operations. Intangible Assets . The Company does not hold any intangible assets with indefinite lives. Identifiable intangible assets recognized as part of a business combination are recorded at their estimated fair value at the time of the business combination. Amortizable intangible assets are reviewed for impairment whenever events or circumstances indicate that the related carrying amount may be impaired. The remaining useful lives of intangible assets are reviewed annually to determine whether events and circumstances warrant a revision to the remaining period of amortization. The Company determined that no impairment indicators were evident, and all originally assigned useful lives remained appropriate during the years ended December 31, 2021 and December 31, 2020. Goodwill . Goodwill represents the excess of the acquisition cost of consideration transferred over the fair value of the identifiable net assets acquired and liabilities assumed from business combinations at the date of acquisition. Goodwill is not amortized, but rather is assessed at least on an annual basis for impairment. If it is determined that it is more likely than not that the fair value is greater than the carrying value of a reporting unit then a qualitative assessment may be used for the annual impairment test. Otherwise, a one-step process is used which requires estimating the fair value of each reporting unit compared to its carrying value. If the carrying value exceeds the estimated fair value, goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The Company has one reporting and operating unit for goodwill testing purposes. The Company experienced a sustained decline in market capitalization during the third quarter of 2021 representing a potential indicator of impairment. Furthermore, the Company continues to experience the repercussions from the global semiconductor shortage. The most impactful being the decline in sales to our automotive customers, as North American automotive production volumes continue to decrease. The Company identified these circumstances and concluded it was more likely than not the fair value of the goodwill was impaired and performed an interim quantitative assessment. The quantitative assessment was performed as of September 30, 2021, utilizing a combination of the income and market approaches. The discounted cash flow method was used to determine the fair value of the reporting unit under the income approach. Key assumptions used in the discounted cash flow analysis included a discount rate of 14.8%, forecasted revenue for the 2022 through 2025, a terminal growth rate for cash flows of 3%, and EBITDA margin of 10.8% by 2025. The guideline public company method was used to determine the fair value of the reporting unit under the market approach. Key assumptions used in this method included revenue and EBITDA multiples for each guideline company. The results of the quantitative analysis performed indicated the carrying value of the reporting unit exceeded the fair value of the reporting unit as of September 30, 2021. As a result, the Company recorded a $5.1 million impairment charge on the consolidated statement of operations for the twelve months ended December 31, 2021. The Company performed its annual assessment of goodwill as of October 1, the assessment concluded no further impairment. The annual assessment of goodwill performed compared the expected financial results used in the most recent quantitative assessment to finalized expectations resulting from the 2021 annual planning process. The Company also performed an interim qualitative assessment as of December 31, 2021, which concluded no impairment. The interim assessment considered fourth quarter results compared to expectations, the status of the automotive industry and volume forecasts, and other qualitative factors. Debt Issuance Costs. Debt issuance costs represent legal, consulting, and other financial costs associated with debt financing and are reported netted against the related debt instrument. Amounts paid to or on behalf of lenders are presented as debt discount, as a reduction of the noted debt instrument. Debt issuance costs on term debt are amortized using the straight-line basis over the term of the related debt (which is immaterially different from the required effective interest method) while those related to revolving debt are amortized using a straight-line basis over the term of the related debt. Investments. Financial Accounting Standards Board (“FASB”) guidance requires certain equity securities to be measured at fair value, with changes in fair value recognized in earnings. For equity securities without readily determinable fair values, entities may elect to measure these securities at cost minus impairment, if any, adjusted for changes in observable prices. The Company has a cost method investment in its consolidated financial statements, and there is not a readily determinable value for this investment. Impairment losses due to a decline in the value of the investment that is other than temporary are recognized when incurred. Dividends received are included in income, except for those dividends received in excess of the Company’s proportionate share of accumulated earnings, which are applied as a reduction of the cost of the investment. Dividend income of less than $0.1 million and $0.1 million was recognized for the years ended December 31, 2021 and December 31, 2020, respectively. No investment impairment loss was recognized for the years ended December 31, 2021 and December 31, 2020. Stock Based Compensation. The Company accounts for its stock-based compensation using the fair value of the award estimated at the grant date of the award. The Company estimates the fair value of awards, consisting of stock options, using the Black Scholes option pricing model. Compensation expense is recognized in earnings using the straight-line method over the vesting period, which represents the requisite service period. The Company accounts for forfeitures as they occur. Revenue Recognition. Revenue is measured based on consideration specified in a contract with a customer, and excludes any sales incentives and amounts collected on behalf of third parties. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. See Note 4, Revenues, for further information on the Company’s revenue recognition in accordance with Accounting Standards Codification (“ASC”) Topic 606. Shipping and Handling. Shipping and handling costs are included in cost of sales as they are incurred. Income Taxes. A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the period. Deferred tax liabilities or assets are recognized for the estimated future tax effects of temporary differences between financial reporting and tax accounting measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company also evaluates the need for valuation allowances to reduce the deferred tax assets to realizable amounts. Management evaluates all positive and negative evidence and uses judgment regarding past and future events, including operating results, to help determine when it is more likely than not that all or some portion of the deferred tax assets may not be realized. When appropriate, a valuation allowance is recorded against deferred tax assets to reserve for future tax benefits that may not be realized. The Company recognizes the benefit of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon settlement with the relevant tax authority. The Company assesses all tax positions for which the statute of limitations remains open. The Company had no unrecognized tax benefits as of December 31, 2021 or December 31, 2020. There were no penalties or interest recorded during the years ended December 31, 2021 or December 31, 2020. Foreign Currency Adjustments. The Company’s functional currency for all operations worldwide is the United States dollar. Nonmonetary assets and liabilities of foreign operations are remeasured at historical rates and monetary assets and liabilities are remeasured at exchange rates in effect at the end of each reporting period. Income statement accounts are remeasured at average exchange rates for the year. Gains and losses from translation of foreign currency financial statements into United States dollars are classified in other income in the consolidated statements of operations. Concentration Risks. The Company is exposed to various significant concentration risks as follows: Customer and Credit During the years ended December 31, 2021 and December 31, 2020, the Company’s sales were derived from customers principally engaged in the North American automotive industry. Company sales directly to General Motors Company (“GM”), Stellantis, Ford Motor Company (“Ford”), and Yanfeng Automotive Interiors (“Yanfeng”), as a percentage of total net sales were: 7%, 7%, 4%, and 8%, respectively, during the year ended December 31, 2021; 9%, 6%, 6%, and 6%, respectively, during the year ended December 31, 2020. None of the Company’s customers represented more than 10% percent of direct Company’s net sales for the years ended December 31, 2021 and December 31, 2020. Yanfeng accounted for 13% of accounts receivable as of December 31, 2021. None of the Company’s customers represented more than 10% of accounts receivable as of December 31, 2020. Labor Markets At December 31, 2021, 54% of our employees are working in the United States, 42% are working in Mexico, and 4% are working in Canada. In the United States, 31% of the hourly work force is covered under collective bargaining agreements that expire in August of 2022 and February of 2023. Foreign Currency Exchange The expression of assets and liabilities in a currency other than the functional currency, which is the United States dollar, gives rise to exchange gains and losses when such assets and obligations are paid in another currency. Foreign currency exchange rate adjustments (i.e., differences between amounts recorded and actual amounts owed or paid) are reported in the consolidated statements of operations as the foreign currency fluctuations occur. Foreign currency exchange rate adjustments are reported in the consolidated statements of operations using the exchange rates in effect at the time of the transaction. At December 31, 2021, the Company’s exposure to assets and liabilities denominated in another currency was not significant. To the extent there is a fluctuation in the exchange rates, the amount of local currency to be paid or received to satisfy foreign currency obligations in 2022 may increase or decrease. International Operations The Company manufactures and sells products outside of the United States primarily in Mexico and Canada. Foreign operations are subject to various political, economic and other risks and uncertainties inherent in foreign countries. Among other risks, the Company’s operations are subject to the risks of restrictions on transfers of funds; export duties, quotas, and embargoes; domestic and international customs and tariffs; changing taxation policies; foreign exchange restrictions; political conditions; and governmental regulations. During the years ended December 31, 2021 and December 31, 2020, 25% and 22%, respectively, of the Company’s production occurred in Mexico. During the years ended December 31, 2021 and December 31, 2020, 9% and 9%, respectively, of the Company's production occurred in Canada. Sales derived from production in Mexico and Canada were 25% and 9% percent, respectively, during the year ended December 31, 2021, 23% and 8% percent, respectively, during the year ended December 31, 2020. Derivative financial instruments. All derivative instruments are required to be reported on the consolidated balance sheets at fair value unless the transactions qualify and are designated as normal purchases or sales. Changes in fair value are reported currently through earnings unless they meet hedge accounting criteria. See Note 10 for further information regarding the Company's derivative instrument makeup. Use of Estimates. The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Examples include allowances for doubtful accounts and sales returns, allowances for inventory obsolescence, useful lives of depreciable assets, fixed asset and goodwill impairment analyses, valuation allowances for deferred tax assets, stock options, and financial instruments. Actual results could differ from those estimates. |
New Accounting Pronouncements
New Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses,” which introduced new guidance for an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. Instruments in scope include loans, held-to-maturity debt securities, and net investments in leases as well as reinsurance and trade receivables. In November 2018, the FASB issued ASU 2018-19, which clarifies that operating lease receivables are outside the scope of the new standard. In November 2019, the FASB issued ASU 2019-10, which established the effective date of the new standard for smaller reporting companies as fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is evaluating the impact, if any, the adoption of the new credit losses model will have on its financial statements. In February 2016, the FASB issued ASU 2016-2, Leases (Topic 842). This update requires lessees to recognize on the balance sheet assets and liabilities for the rights and obligations created by leases of greater than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. We have identified our existing lease contracts and calculated the right of use assets, which are reflected in other assets on the consolidated balance sheets, and lease liabilities, which are reflected in the other accrued liabilities on the consolidated balance sheets. This guidance was effective for the Company as of January 1, 2020. Adoption of the new standard resulted in the recording of right-of-use assets and liabilities of $12.1 million and $12.8 million, respectively, as of January 1, 2020. The FASB has issued further ASUs related to the standard providing an optional transition method allowing entities to not recast comparative periods. The Company elected the practical expedients upon transition that retained the lease classification and initial direct costs for any leases that exist prior to adoption of the standard. The Company has approximately $10.5 million of non-cancelable future rental obligations as of December 31, 2021, as shown in Note 14. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740). The guidance simplifies accounting for income taxes by removing certain exceptions. This new guidance is effective for fiscal years beginning after December 15, 2020 for public companies. The Company adopted this guidance on a prospective basis and there was no material impact. In March 2020, the FASB issued ASU No. 2020-04 “Reference Rate Reform”. The ASU provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or any other reference rate expected to be discontinued. In January 2021, the FASB issued ASU 2021-01 - Reference Rate Reform (Topic 848). The amendments in this ASU clarify that certain option expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivative instruments that |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues The following table presents the Company's net sales disaggregated by major sales channel for the twelve months ended December 31, 2021 and December 31, 2020: Twelve Months Ended Twelve Months Ended (dollars in thousands) Net Sales Transportation $ 111,229 $ 105,463 Appliance 12,160 11,302 Other 2,280 3,449 Total $ 125,669 $ 120,214 General Recognition Policy Revenue is recognized by the Company once all performance obligations under the terms of a contract with the Company's customers are satisfied. Generally, this occurs with the transfer of control of its automotive, HVAC, and other products. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring its products. The Company’s payment terms vary by the type and location of its customers and the products offered. The term between invoicing and when payment is due is not significant. In general, for sales arrangements, the Company deems control to transfer at a single point in time and recognizes revenue when it ships products from its manufacturing facilities to its customers. Once a product has shipped, the customer is able to direct the use of, and obtain substantially all of the remaining benefits from, the asset. The Company considers control to transfer upon shipment because the Company has a present right to payment at that time, the customer has legal title to the asset, and the customer has significant risks and rewards of ownership of the asset. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. Contract Balances The timing of revenue recognition, billings, and cash collections and payments results in billed accounts receivable. The Company does not have deferred revenue. Additionally, as noted in the Accounts Receivable section of Note 2, Summary of Significant Accounting Policies , management reviews the allowance for doubtful accounts at regular intervals. Account balances are charged off against the allowance when management determines it is probable the receivable will not be recovered. The allowance for doubtful account balances are noted in the Accounts Receivable section of Note 2. Practical Expedients The Company elects the practical expedient to expense costs incurred to obtain a contract with a customer when the amortization period would have been one year or less. These costs include sales commissions as the Company has determined annual compensation is commensurate with annual sales activities. The Company elects the practical expedient that does not require the Company to adjust consideration for the effects of a significant financing component when the period between shipment of its products and customer’s payment is one year or less. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: December 31, 2021 December 31, 2020 (dollars in thousands) Raw materials $ 9,242 $ 7,366 Work in progress 990 1,225 Finished goods 3,538 3,360 Total inventory $ 13,770 $ 11,951 The allowance for inventory valuation was $1.2 million and $0.4 million at December 31, 2021 and December 31, 2020, respectively. Included in inventory are assets located in Mexico with a carrying amount of $4.0 million at December 31, 2021 and $3.1 million at December 31, 2020, and assets located in Canada with a carrying amount of $1.1 million at December 31, 2021 and $1.1 million at December 31, 2020. |
Property, Plant, and Equipment,
Property, Plant, and Equipment, Net | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, and Equipment, Net | Property, Plant, and Equipment, Net Property, plant, and equipment, net consists of the following: December 31, 2021 December 31, 2020 Depreciable (dollars in thousands) Land $ 538 $ 538 Buildings 7,630 6,923 23 - 40 Shop equipment 26,049 23,436 7 - 10 Leasehold improvements 1,283 1,245 3 - 10 Office equipment 3,047 2,331 3 - 7 Mobile equipment 50 152 3 Construction in progress 1,554 2,315 Total cost 40,151 36,940 Accumulated depreciation 17,584 14,557 Property, plant, and equipment, net $ 22,567 $ 22,383 Depreciation expense was $3.2 million for the twelve months ended December 31, 2021 and $3.0 million for the twelve months ended December 31, 2020. Included in property, plant, and equipment, net are assets located in Mexico with a carrying amount of $3.5 million and $3.7 million at December 31, 2021 and December 31, 2020, respectively, and assets located in Canada with a carrying amount of $0.4 million and $0.4 million at December 31, 2021 and December 31, 2020, respectively. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Changes in the carrying value of goodwill are as follows: (dollars in thousands) Balance at December 31, 2020 Goodwill $ 28,871 Accumulated impairment losses (6,760) Net beginning balance 22,111 Goodwill impairment (5,115) Balance at December 31, 2021 $ 16,996 Goodwill Impairment The Company experienced a sustained decline in market capitalization during the third quarter of 2021 representing a potential indicator of impairment. Furthermore, the Company continued to experience the repercussions from the global semiconductor shortage. The most impactful was the decline in sales to our automotive customers, as North American automotive production volumes continued to be less than expected. The Company identified these circumstances and concluded it was more likely than not the fair value of the goodwill was impaired, and performed an interim quantitative assessment. The quantitative assessment was performed as of September 30, 2021, utilizing a combination of the income and market approaches. The analysis required the comparison of the Company’s carrying value with it’s fair value, with an impairment recorded for any excess of carrying value over the fair value. The discounted cash flow method was used to determine the fair value of the reporting unit under the income approach. Key assumptions used in the discounted cash flow analysis included a discount rate of 14.8%, forecasted revenue for 2022 through 2025, a terminal growth rate for cash flows of 3%, and EBITDA margin of 10.8% by 2025. The guideline public company method was used to determine the fair value of the reporting unit under the market approach. Key assumptions used in this method included revenue and EBITDA multiples for each guideline company. The results of the quantitative analysis performed indicated the carrying value of the reporting unit exceeded the fair value of the reporting unit as of September 30, 2021. As a result, the Company recorded a $5.1 million impairment charge on the consolidated statement of operations for the twelve months ended December 31, 2021. Annual Assessment During 2021, the Company decided to change the testing date for the annual impairment assessment for goodwill from December 31, to October 1. This change was made to align the annual assessment with the Company’s annual planning process and to alleviate the additional demand created when conducting the assessment during the year-end financial close process. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets of the Company consist of the following at December 31, 2021: Gross Carrying Accumulated Weighted Average (dollars in thousands) Customer contracts $ 26,518 $ 23,887 8.16 Trade names 4,673 2,143 16.43 Non-compete agreements 1,162 1,162 2.53 Unpatented technology 1,534 1,534 5.00 Total $ 33,887 $ 28,726 Intangible assets of the Company consist of the following at December 31, 2020: Gross Carrying Accumulated Weighted Average (dollars in thousands) Customer contracts $ 26,518 $ 21,719 8.16 Trade names 4,673 1,924 16.43 Non-compete agreements 1,162 1,162 2.53 Unpatented technology 1,534 1,477 5.00 Total $ 33,887 $ 26,282 The weighted average amortization period for all intangible assets is 8.96 years. Amortization expense for intangible assets totaled $2.4 million for the twelve months ended December 31, 2021 and $4.0 million for the twelve months ended December 31, 2020. Estimated amortization expense for the next five years is as follows: Estimated Amortization Expense (dollars in thousands) 2022 $ 1,305 2023 979 2024 759 2025 573 2026 223 Thereafter 1,322 Total $ 5,161 |
Long-term Debt
Long-term Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term Debt The Company’s long-term debt consists of the following: December 31, 2021 December 31, 2020 (dollars in thousands) U.S. Small Business Administration Paycheck Protection Program loan (PPP Note), payable in equal monthly installments on the first day after the deferment period. The PPP Note was unsecured and bore interest at 1% per annum. The PPP Note was forgiven during the third quarter of 2021. $ — $ 5,999 US Term Loan, payable to lenders in quarterly installments of $0.8 million through November 7, 2023, with a lump sum due at maturity. The effective interest rate was 5.50% and 5.25% per annum at December 31, 2021, and December 31, 2020, respectively. At December 31, 2021, the balance of the New US Term Loan is presented net of a debt discount of $0.1 million from costs paid to or on behalf of the lenders. 20,383 22,768 CA Term Loan, payable to lenders in quarterly installments of $0.4 million through November 7, 2023, with a lump sum due at maturity. The effective interest rate was 5.50% and 5.25% per annum at December 31, 2021 and December 31, 2020, respectively. At December 31, 2021, the balance of the CA Term Loan is presented net of a debt discount of $0.1 million from costs paid to or on behalf of the lenders. 7,437 8,876 Capital expenditure line payable to lenders in quarterly installments of 12.5% of the outstanding principal balance per annum through November 7, 2023, with a lump sum due at maturity. The effective interest rate was 5.50% and 5.25% per annum at December 31, 2021 and December 31, 2020, respectively. 1,064 1,220 Total debt excluding Revolver 28,884 38,863 As of December 31, 2021, and December 31, 2020, the fair value of the Company’s debt approximates book value based on the variable terms. Credit Agreement On November 8, 2018, Unique Fabricating NA, Inc. (the “US Borrower”) and Unique-Intasco Canada, Inc. (the “CA Borrower” and together with US Borrower, the “Borrowers”) and Citizens Bank, National Association (“Citizens”), acting as lender and Administrative Agent, and other lenders (collectively, the “Lenders”), entered into an Amended and Restated Credit Agreement (the “Credit Agreement”), which amended and restated the Original Credit Agreement entered into on April 29, 2016 (as amended, the “Original Credit Agreement”). The Credit Agreement is a five-year agreement and provided for borrowings up to an aggregate principal amount of $73.0 million. The Credit Agreement, which is a senior secured credit facility comprised of a revolving line of credit of up to $30.0 million (the “Revolver”) to the US Borrower, a $26.0 million principal amount term loan (the “US Term Loan”) to the US Borrower, a $12.0 million principal amount term loan (the “CA Term Loan”) to the CA Borrower, and a two-year line to fund capital expenditures of up to $2.5 million through November 8, 2019 and $5.0 million thereafter through November 8, 2020 to the US Borrower (the “Capital Expenditure Line”). The Credit Agreement has a maturity date for all borrowings of November 7, 2023. The Credit Agreement, as amended, bears interest at the Company’s election of either (i) the greater of the Prime Rate or the Federal Funds Effective Rate (the “Base Rate”) or (ii) the LIBOR rate, plus an applicable margin ranging from 1.75% to 3.25% per annum in the case of the Base Rate and 2.75% to 4.25% per annum in the case of the LIBOR rate, in each case, based on senior leverage ratio thresholds, measured quarterly, as increased by the Waiver and Fourth Amendment to the Credit Agreement. The Seventh Amendment to the Credit Agreement added a 1.0% LIBOR Floor and 2.0% Base Rate Floor. The First Amendment to the Forbearance Agreement increased the per annum interest rate from 4.25% to 4.50% for the duration of the Forbearance Period. Furthermore, the First Amendment imposes Payment in Kind (“PIK”) additional interest of 0.5% per annum on all outstanding debt subject to the Credit Agreement, which is payable on May 30, 2022, currently the termination date of the Forbearance Agreement, or earlier in the event of a Forbearance Termination event, as defined. As of December 31, 2021, $19.8 million was outstanding under the Revolver. This amount is gross of debt issuance costs which are further described in the next section. The Revolver had an effective interest rate of 5.5% percent per annum at December 31, 2021, and is secured by substantially all of the Company’s assets. The maximum amount available was further subject to borrowing base restrictions, resulting in a net availability of $2.2 million at December 31, 2021, which includes a reduction for a $0.1 million letter of credit issued for the benefit of the landlord of one of the Company’s leased facilities. Further reducing the net availability at December 31, 2021 was an erroneous duplicate withdrawal for our Canadian Term Loan principal and interest payments of $411 thousand. A prepaid expense for this amount was recorded on the Company’s consolidated balance sheet. The Company’s financial results for the six months ended December 31, 2020 and the nine months ended March 31, 2021 resulted in violations of one or more of the following financial covenants: (1) Maximum Total Leverage Ratio; (2) Minimum Debt Service Coverage Ratio; and (3) Minimum Consolidated EBITDA; as defined in the Company’s Credit Agreement. The Company entered into a Forbearance Agreement, providing a period commencing on April 9, 2021 and through and including June 15, 2021, during which the Company was able to borrow on its Revolver, subject to the terms and conditions to making a revolving credit advance, including availability, and the Lenders agreed, subject to the terms of the Forbearance Agreement, to forbear from enforcing their rights or seeking to collect payment of the Company’s debt or disposing of the collateral securing the debt. On June 14, 2021, the Company entered into the First Amendment to the Forbearance Agreement, which among other things, extended the forbearance period from June 15, 2021 to February 28, 2022 and waived the testing of the Maximum Total Leverage Ratio and Minimum Debt Service Coverage ratios for the duration of the Forbearance Period. The First Amendment also substituted Minimum Liquidity and Minimum Consolidated EBITDA requirements which are tested monthly beginning with the month ending July 31, 2021. During the extended period, the Company was able to borrow under the revolving line of credit, subject to availability and satisfaction of certain other conditions. On September 21, 2021, the Company entered into the Second Amendment to Forbearance Agreement, which among other things, made changes to the calculations of financial covenants, contained revised requirements for Minimum Liquidity and Minimum Consolidated EBITDA, as defined, for the monthly periods through and including February 28, 2022, and revised the Revolving Credit Aggregate Commitment from $30 million to $27 million. On December 9, 2021, the Company entered into the Third Amendment to Forbearance Agreement. As previously reported, the Company was in violation of the required Minimum Consolidated EBITDA Covenant (as amended by the Second Amendment to the Forbearance Agreement) as of September 30, 2021. The Lenders in the Third Amendment to the Forbearance Agreement, among other things, agreed to forbear with respect to the Minimum Consolidated EBITDA covenant violation and to suspend the Minimum Consolidated EBITDA covenant during the remainder of the forbearance period. The Third Amendment includes a new covenant which will be tested weekly on a rolling basis, beginning December 15, 2021, and requires that the Company’s actual cumulative total cash disbursements for the period being tested to not exceed total cash disbursements projected by the Company for the same period by more than 15% at any time during the forbearance period. The Third Amendment also reduces the Revolving Credit Aggregate Commitment from $27 million to $25 million. As of December 31, 2021, the Company was in violation of the required minimum Liquidity covenant, as provided in the Second Amendment to the Forbearance Agreement, dated September 21, 2021. As a result, on February 4, 2022, the Company entered into the Fourth Amendment to Forbearance Agreement. The Lenders in the Fourth Amendment agreed to waive the minimum Liquidity covenant violation. The Company did have the required minimum liquidity by the conclusion of the first week of 2022. On February 25, 2022, the Company entered into the Fifth Amendment to Forbearance Agreement, which extends the Forbearance Period from February 28, 2022, to March 11, 2022. The Company used the short-term extension of its Forbearance Agreement, provided by the Fifth Amendment, to conduct negotiations of a longer extension with the Lenders. On March 11, 2022, the Company entered into the Sixth Amendment to Forbearance Agreement, which extends the Forbearance Period from March 11, 2022, to May 30, 2022. The Company intends to use the latest extension of its Forbearance Agreement, provided by the Sixth Amendment, to pursue a cure or waiver of financial covenant defaults and amended credit agreement. Debt Issuance Costs Debt issuance costs represent legal, consulting, and other financial costs associated with debt financing and are reported netted against the related debt instrument. Amounts paid to or on behalf of lenders are presented as a debt discount and are also shown as a reduction of the associated debt instrument. Debt issuance costs on term debt are amortized using the straight line basis over the term of the related debt (which is immaterially different from the required effective interest method) while those related to revolving debt are amortized using a straight line basis over the term of the related debt. At December 31, 2021 and December 31, 2020, unamortized debt issuance costs were $248 thousand and $376 thousand, respectively, while amounts paid to or on behalf of lenders presented as unamortized debt discounts were $187 thousand and $285 thousand, respectively. Amortization expense of both debt issuance costs and debt discounts has been recognized as a component of interest expense in the amount $226 thousand of for the twelve months ended December 31, 2021, and $189 thousand for the twelve months ended December 31, 2020. Paycheck Protection Program Note On April 24, 2020, the Company entered into a Promissory Note (“PPP Note”) for $6.0 million with Citizens Bank, National Association, (“PPP Lender”) pursuant to the U.S. Small Business Administration (“SBA”) Paycheck Protection Program under Title I of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act passed by Congress and signed into law on March 27, 2020. On June 3, 2020, Congress passed the Paycheck Protection Program Flexibility Act of 2020 (the “PPP Flexibility Act”) and on June 5, 2020 it was signed into law. The PPP Flexibility Act modified certain provisions of the CARES Act. The PPP Note was unsecured, bore interest at 1.00% per annum, with principal and interest payments deferred until the earlier of (i) the PPP Lender receiving the forgiveness amount from the SBA or (ii) August 12, 2021. On August 9, 2021, the Company received notification that the SBA approved the Company’s PPP Loan forgiveness application for the entire PPP Loan, including accrued interest. The Company recognized a gain on the forgiveness of the principal loan balance in the amount of $6.0 million and $0.1 million for the accrued interest, in the twelve months ended December 31, 2021 in Other, net on the consolidated statement of operations. Covenant Compliance The Credit agreement, as further amended and forbore by the Forbearance Agreement, as amended, contains the following financial covenants: Maximum Total Leverage Ratio The Total Leverage Ratio, as defined in the Credit Agreement, as amended, may not exceed (i) 3.75 to 1.00, with respect to the fiscal quarter ended as of September 30, 2020; (ii) 3.50 to 1.00, with respect to the fiscal quarter ended December 31, 2020; (iii) 3.25 to 1.00, with respect to the fiscal quarters ended March 31, 2021 and June 30, 2021; and (iv) 3.00 to 1.00, with respect to each fiscal quarter thereafter. For purposes of calculating the Total Leverage Ratio, “Consolidated EBITDA”, as defined, shall be determined (i) with respect to the fiscal quarter ended as of September 30, 2020, for the single fiscal quarter then ended, multiplied by 4,(ii) with respect to the fiscal quarter ended as of December 31, 2020, for the two fiscal quarters then ended, multiplied by 2, (iii) with respect to the fiscal quarter ended as of March 31, 2021, for the three fiscal quarters then ended, multiplied by 4/3, and (iv) with respect to each fiscal quarter thereafter, for the four fiscal quarters then ended. Also, for purposes of calculating the Total Leverage Ratio, the PPP Note is excluded from Total Debt for all periods until a determination of forgiveness is made. However, testing of the Total Leverage Ratio is suspended during the remainder of the Forbearance Period. Minimum Debt Service Coverage Ratio The Debt Service Coverage Ratio may not be less than 1.20 to 1.00, to be measured, as of the end of each fiscal quarter. Notwithstanding anything to the contrary set forth in the definition of "Debt Service Coverage Ratio," such calculation shall be made (i) with respect to the fiscal quarter ended as of September 30 2020, for the single fiscal quarter then ended, (ii) with respect to the fiscal quarter ended as of December 31, 2020, for the two fiscal quarters then ended, (iii) with respect to the fiscal quarter ended as of March 31, 2021, for the three fiscal quarters then ended, and (iv) with respect to the last day of each fiscal quarter thereafter, for the four fiscal quarters then ended. However, testing of the Total Leverage Ratio is suspended during the remainder of the Forbearance Period. Minimum Liquidity The Second Amendment to the Forbearance Agreement eliminated the Minimum Liquidity covenant of the previous Amendment to the Forbearance Agreement as well as of the Credit Agreement and replaced it with the following: Date of Determination Minimum Liquidity December 31, 2021 $3,000,000 January 31, 2022 $3,000,000 February 28, 2022 $3,000,000 As of December 31, 2021, the Company was not in compliance with this covenant. However, by the conclusion of the first week of 2022, the Company was back in compliance with the Minimum Liquidity requirement. Furthermore, the Fourth Amendment to the Forbearance Agreement, waived the Company’s noncompliance at December 31, 2021. Minimum Consolidated EBITDA The Second Amendment to the Forbearance Agreement eliminated the Minimum Consolidated EBITDA covenant of the previous Amendment to the Forbearance Agreement as well as of the Credit Agreement and replaced it with the following: Date of Determination Measurement Period Minimum Consolidated EBITDA December 31, 2021 Trailing 12 months $4,100,000 January 31, 2022 Trailing 12 months $4,200,000 February 20, 2022 Trailing 12 months $4,700,000 At September 30, 2021, the Company was not in compliance with this covenant. The Third Amendment to the Forbearance Agreement forbore the Termination Event this default constituted. The Third Amendment to the Forbearance Agreement also suspended testing of this covenant for the remainder of the Forbearance Period. Projected Cash Disbursements The Third Amendment to the Forbearance Agreement establishes a financial covenant limiting the Company’s cash disbursements for the duration of the Forbearance Period. Commencing on December 15, 2021, the cumulative total cash disbursements shall not exceed the Company’s projected total cash disbursements for the same cumulative period by more than 15%. Future Maturities Maturities on the Company’s Amended and Restated Credit Agreement and other long term-debt obligations for the remainder of the current fiscal year and future fiscal years: Future Maturities (dollars in thousands) 2022 $ 48,860 2023 — Total 48,860 Discounts (187) Debt issuance costs (248) Total debt, net $ 48,425 |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments Interest Rate Swap The Company holds derivative financial instruments, in the form of interest rate swaps, as required by Amended and Restated Credit Agreement, for the purpose of hedging certain identifiable transactions in order to mitigate risks relating to the variability of future earnings and cash flows caused by interest rate fluctuations. The Company has elected not to apply hedge accounting for financial reporting purposes. The interest rate swaps are recognized in the accompanying consolidated balance sheets at their fair value. Monthly settlement payments due on the interest rate swaps and changes in their fair value are recognized currently in net income as interest expense in the consolidated statements of operations. Effective November 30, 2018, as required under the Amended and Restated Credit Agreement, the Company entered into an interest rate swap that requires the Company to pay a fixed rate of 3.075 percent per annum while receiving a variable interest rate per annum based on the one month LIBOR for a net monthly settlement based on the notional amount in effect. The notional amount at the effective date was $5.0 million, which increased by $0.4 million each quarter until June 28, 2019 when the notional amount increased to $17.5 million due to another interest rate swap from 2016 expiring. The notional amount then decreased each quarter by $0.2 million until September 30, 2020 when the notional amount increased to $17.5 million due to another interest rate swap from 2017 expiring. The notional amount then decreased each quarter by $0.4 million until December 31, 2021 after which it will then decrease each subsequent quarter by $0.6 million until it expires on November 8, 2023. At December 31, 2021, the fair value of the swap was $0.6 million, which is included in other long-term liabilities in the consolidated balance sheet. The Company paid $0.5 million in the aggregate, in net monthly settlements with respect to the interest rate swap for the twelve months ended December 31, 2021. At December 31, 2020, the fair value of all the swaps was $1.2 million, which was included in other long-term liabilities in the consolidated balance sheet. The Company paid $0.5 million, in the aggregate, in net monthly settlements with respect to the interest rate swaps for the twelve months ended December 31, 2020. |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring The Company's restructuring activities are undertaken as necessary to implement management's strategy and improve operating results. The restructuring activities generally relate to realignment of existing manufacturing capacity and closure of facilities and other exit or disposal activities, either in the normal course of business or pursuant to specific restructuring programs. The table below summarizes the activity in the restructuring liability for the twelve months ended December 31, 2020: Employee Termination Benefits Liability Other Exit Costs Liability Total (dollars in thousands) Accrual balance at December 29, 2019 $ 438 $ 116 $ 554 Provision for estimated expenses incurred during the year — 1,230 1,230 Payments made during the year 438 671 1,109 Asset impairments and other — 675 675 Accrual balance at December 31, 2020 $ — $ — $ — Evansville Restructuring On July 16, 2019, the Company made the decision to close its manufacturing facility in Evansville, Indiana. The Company ceased operations at the Evansville facility during the fourth quarter of 2019, an approximately 47 positions were eliminated as a result of the closure. The Company's decision resulted from its desire to streamline operations and to utilize some of the available excess capacity in our other facilities. The Company moved the Evansville production to its existing manufacturing facilities in LaFayette, Georgia, Auburn Hills, Michigan, and Louisville, Kentucky. The Company provided the affected employees severance pay, health benefits continuation, and job search assistance. The Company evaluated whether or not this closing met the criteria for discontinued operations and concluded that the closing did not meet the definition as it did not represent a strategic shift in the Company's operations and the Company has continuing cash flows from the production being moved to other facilities within the Company. The Company incurred costs of $0.6 million during the twelve months ended December 31, 2020, which consisted primarily of the relocation of equipment, the disposal of equipment and inventory, and the impairment of the ROU asset for the leased warehouse. Also included in this amount is a non-cash loss related to the loss on the sale of the Evansville building. All of these costs were recorded to the restructuring expense line in continuing operations in the Company’s consolidated statements of operations. The Company had $0.3 million and $0.7 million of remaining lease payments for a warehouse near the Evansville, Indiana facility as of December 31, 2021 and December 31, 2020, respectively. The Company has secured subleases of roughly 78% of the facility. |
Stock Incentive Plans
Stock Incentive Plans | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock Incentive Plans | Stock Incentive Plans 2013 Stock Incentive Plan The Company’s board of directors approved a stock incentive plan (the “Plan”) in 2013. The Plan permits the Company to grant 495,000 non statutory or incentive stock options to the employees, directors and consultants of the Company. 495,000 shares of unissued common stock are reserved for the Plan. The board of directors has the authority to determine the participants to whom stock options shall be awarded as well as any restrictions to be placed upon the awards. The exercise price cannot be less than the fair value of the underlying shares at the time the stock options are issued and the maximum length of an award is ten years. On June 11, 2021, the compensation committee of the board of directors approved the issuance of 38,943 non statutory stock option awards to employees of the Company. All of the awards have an exercise price of $3.31 per share with a weighted average grant date fair value of $1.64 per share. These options vested immediately upon issuance. On December 3, 2021, the compensation committee of the board of directors approved the issuance of 12,500 non statutory stock option awards to an employee of the Company. All of the awards have an exercise price of $2.08 per share with a weighted average grant date fair value of $0.46 per share. These awards vest 50 percent once the closing price of the Company’s stock is in excess of $7.50 per share for 10 out of 20 consecutive trading days and an additional 50 percent once the closing price of the Company’s common stock is in excess of $12.50 per share for 10 out of 20 consecutive trading days. 2014 Omnibus Performance Award Plan In 2014, the board of directors and stockholders adopted the 2014 Omnibus Performance Award Plan, or the 2014 Plan. The 2014 Plan provides for the grant of cash awards, stock options, stock appreciation rights, or SARs, shares of restricted stock and restricted stock units, or RSUs, performance shares and performance units. The 2014 Plan originally authorized the grant of awards relating to 250,000 shares of our common stock. In the event of any transaction that causes a change in capitalization, the compensation committee, such other committee administering the 2014 Plan or the board of directors will make such adjustments to the number of shares of common stock delivered, and the number and/or price of shares of common stock subject to outstanding awards granted under the 2014 Plan, as it deems appropriate and equitable to prevent dilution or enlargement of participants’ rights. An amendment approved in March of 2016 by our board of directors, which was approved by our stockholders at our annual meeting of stockholders in June 2016, increased the number of shares authorized for grant of awards under the 2014 Plan to a total of 450,000 shares of our common stock. In July 2020, an additional amendment was approved at our annual meeting of stockholders, which increased the number of shares authorized for grant of awards under the 2014 Plan to a total of 700,000 shares of our common stock. The fair value of each of the option awards is estimated on the grant date using a Black Scholes option pricing model that uses the weighted average assumptions noted in the following tables. The expected volatility is based on the historical volatility of the stock of comparable companies. The expected term of the awards was estimated based on findings from academic studies investigating the average holding period for options for adjusted for the Company’s size and risk factors. The risk free rate for periods within the contractual life of the option is based on the United States Treasury yield curve in effect at the time of grant. On May 4, 2021, the compensation committee of the board of directors approved the issuance of 139,278 non statutory stock option awards to employees of the Company. All of the awards have an exercise price of $4.51 per share with a weighted average grant date fair value of $2.28 per share. 20% of these options vested immediately and the remainder vest in 20% tranches on each of May 4, 2022, 2023, 2024, and 2025, respectively. On June 11, 2021, the compensation committee of the board of directors approved the issuance of 59,254 non statutory stock option awards to employees of the Company. All of the awards have an exercise price of $3.31 per share with a weighted average grant date fair value of $1.64 per share. These options vested immediately upon issuance. On December 3, 2021, the compensation committee of the board of directors approved the issuance of 12,500 non statutory stock option awards to an employee of the Company. All of the awards have an exercise price of $2.08 per share with a weighted average grant date fair value of $1.22 per share. 40% of these options vest on December 3, 2022, and the remainder vest in 20% tranches on each of December 3, 2023, 2024, and 2025, respectively. May 4, 2021 June 11, 2021 December 3, 2021 Expected volatility 53.76 % 57.77 % 64.26 % Dividend yield — % — % — % Expected term (in years) 6 5 6 Risk-free rate 1.05 % 0.96 % 1.21 % A summary of option activity under both plans is presented below: Number of Shares Weighted Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (1) (dollars in thousands, except share data and exercise price) Outstanding at December 31, 2020 726,500 $ 4.53 7.2 $ 1,484 Granted 262,475 $ 3.83 5.0 $ — Exercised — $ — 0.0 $ — Forfeited or expired 142,244 $ 9.73 0.0 $ — Outstanding at December 31, 2021 846,731 $ 4.00 7.6 $ — Vested and exercisable at December 31, 2021 384,858 $ 4.85 6.6 $ — ________________________________________ (1) The aggregate intrinsic value above is obtained by subtracting the exercise price from the estimated fair value of the underlying shares and multiplying this result by the related number of options outstanding and exercisable as of the period end date. There is no intrinsic value if the exercise price exceeds the fair value of the underlying shares. The estimated fair value of the shares is based on the closing stock price of $1.96 as of December 31, 2021 and $5.50 as of December 31, 2020. The Company recorded gross compensation expense of approximately $0.4 million for the twelve months ended December 31, 2021 and $0.1 million for the twelve months ended December 31, 2020, in its consolidated statements of operations, as a component of sales, general, and administrative expenses. The income tax benefit related to share based compensation expense was immaterial for the twelve months ended December 31, 2021 and December 31, 2020. As of December 31, 2021, there was approximately $0.6 million of total unrecognized compensation cost related to non-vested stock option awards under the plans. That cost is expected to be recognized over a weighted average period of 3.8 years. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income before income taxes for U.S. and Non-U.S. operations are as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) U.S. (loss) income $ (6,809) $ (11,274) Non-U.S. income (1,006) 1,780 (Loss) income before income taxes $ (7,815) $ (9,494) The components of the income tax provision included in the consolidated statements of operations are all attributable to continuing operations and are detailed as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) Current tax expense: Federal $ (333) $ (2,918) State 51 42 Foreign 916 631 Total 634 (2,245) Deferred tax expense: Federal — (1,236) State — (83) Foreign (1,486) (220) Total (1,486) (1,539) Total income tax expense $ (852) $ (3,784) Deferred income tax assets and liabilities at December 31, 2021 and December 31, 2020 reflect the effect of temporary differences between amounts of assets, liabilities and equity for financial reporting purposes and the bases of such assets, liabilities and equity as measured based on tax laws, as well as tax loss and tax credit carryforwards. The following table summarizes the components of temporary differences and carryforwards that give rise to deferred tax assets and liabilities: December 31, 2021 December 31, 2020 (dollars in thousands) Deferred tax assets (liabilities): Allowance for doubtful accounts $ 298 $ 345 Inventories 296 99 Accrued payroll and benefits 418 513 Goodwill and intangible assets 2,135 951 Excess interest expense 1,090 447 Tax credits and NOLs 3,226 1,427 Lease liabilities 2,412 2,604 Other 300 339 Deferred tax asset before valuation allowance 10,175 6,725 Valuation allowance (3,354) (684) Deferred tax asset 6,821 6,041 Property, plant, and equipment (1,975) (2,544) Lease assets (2,348) (2,495) Other (119) (109) Deferred tax liability (4,442) (5,148) Total deferred tax asset (liability) $ 2,379 $ 893 Management evaluates all positive and negative evidence and uses judgment regarding past and future events, including operating results, to help determine when it is more likely than not that all or some portion of the deferred tax assets may not be realized. When appropriate, a valuation allowance is recorded against deferred tax assets to reserve for future tax benefits that may not be realized. As of the years ended December 31, 2021 and December 31, 2020, the Company has recorded a valuation allowance on the net U.S. federal and state deferred tax assets as the Company has concluded that it is not more than likely than not that these deferred tax assets will be realized. As of December 31, 2021, we have cumulative tax effected U.S. federal tax losses of $1.8 million that carryforward indefinitely and U.S. state Net Operating Loss carry forwards of $0.2 million. Certain tax loss amounts begin to expire in the year 2024 while other state tax losses carryforward indefinitely. Also, we have $1.2 million of tax credit carryforwards, which expire in the years 2028 to 2042. The transition tax provision of the 2017 tax reform act eliminated the basis difference that existed previously for purposes of ASC Topic 740. However, there are limited other taxes that could continue to apply such as foreign withholding and certain state taxes. U.S. income taxes have not been recognized for such taxes as the Company continues to remain indefinitely reinvested with respect to its foreign earnings. It is not practicable to estimate the amount of income taxes that may be payable on such undistributed foreign earnings. A reconciliation of taxes on income from continuing operations based on the statutory federal income tax rate to the provision for income taxes is as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) Income tax expense (benefit) at US Statutory Tax Rate $ (1,641) $ (1,994) State income tax (benefit) expense, net of federal benefit (167) (31) Foreign tax rate differential 1 155 U.S. Tax on non-U.S. income — (561) Goodwill impairment 156 — Research and Development credits (150) (269) Assets Basis Adjustment (650) — NOL carryback — (1,037) Valuation allowance 2,670 63 PPP loan forgiveness (1,396) — Other 325 (110) Total provision for income taxes $ (852) $ (3,784) The Treasury Department issued final regulations in July 2020 that provide for a high-tax exception to the Global Intangible Low-Taxed Income (“GILTI”) tax that were retroactive to tax years beginning after December 31, 2017. As a result, the Company recognized a $0.6 million tax benefit in 2020 for the reduction of GILTI tax expense. The Company recognizes the benefit of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon settlement with the relevant tax authority. The Company assesses all tax positions for which the statute of limitations remains open. The Company had no unrecognized tax benefits as of December 31, 2021 and December 31, 2020. The Company recognizes any penalties and interest when necessary as income tax expense. There were no penalties or interest recorded during the twelve months ended December 31, 2021 or December 31, 2020. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | Leases On January 1, 2020, the Company adopted the accounting guidance under ASC 842 “Leases”, as issued by the FASB under ASU 2016-02, by applying the modified retrospective method without restatement of comparative periods’ financial information. More information regarding the Company’s accounting policies can be found in Note 3 , New Accounting Pronouncements . The Company leases certain industrial spaces, land, and equipment. Some leases include one or more options to renew, with renewal terms that can extend the lease term from generally one Company’s sole discretion, and are included in the lease term only to the extent such renewal options are reasonably certain of being exercised at lease commencement. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. As of December 31, 2021, leases that the Company has signed but have not yet commenced are immaterial. Leased assets and liabilities included within the consolidated balance sheets consist of the following: Classification December 31, 2021 December 31, 2020 (dollars in thousands) Right-of-Use-Assets Operating Operating Leases $ 9,776 $ 10,415 Liabilities Current Operating Other accrued liabilities $ 1,812 $ 2,309 Non-current Operating Other long term liabilities 8,648 8,911 Total lease liabilities $ 10,460 $ 11,220 Maturity of the Company’s lease liabilities as of December 31, 2021 is as follows: Estimated Future Lease Liability Maturities (dollars in thousands) 2022 $ 2,426 2023 1,756 2024 1,669 2025 1,660 2026 1,471 Thereafter 4,225 Total lease payments 13,207 Less: interest 2,747 Present value of lease payments $ 10,460 As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate base on the information available at the commencement date in determining the present value of lease payments. Remaining lease term and discount rates are as follows: December 31, 2021 December 31, 2020 Weighted average remaining lease term (years) 7 7 Weighted average discount rate 6.52 % 6.39 % Lease costs included in the consolidated statements of cash flows are as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows from operating leases $ 2,981 $ 3,335 |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Retirement Plans | Retirement PlansThe Company maintains a defined contribution plan covering certain full-time salaried employees. Employees can make elective contributions to the plan. The Company contributes 100 percent of an employee’s contribution up to the first 3 percent of each employee’s total compensation and 50 percent for the next 2 percent of each employee’s total compensation. In addition, the Company, at the discretion of the board of directors, may make additional contributions to the plan on behalf of the plan participants. The Company contributed $0.4 million for the twelve months ended December 31, 2021 and $0.4 million for the twelve months ended December 31, 2020. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Effective March 18, 2013, the Company is under a management agreement with a firm related to several stockholders. The agreement initially provided for annual management fees of $0.3 million and additional fees for assistance provided with acquisitions. Effective upon completion of the Company's initial public offering, the agreement was amended to reduce the annual management fee by an amount equal to the amount, if any, of annual cash retainers and equity awards received as compensation for service on the board of directors by any person who is a related person of Taglich Private Equity, LLC or Taglich Brothers, Inc. The Company incurred management fees of $0.1 million for the twelve months ended December 31, 2021, before the Forbearance Agreement the Company entered with its lenders suspended the payment of any additional management fees. The Company incurred management fees of $0.2 million for the twelve months ended December 31, 2020. The management agreement had an initial term of five years, expiring on March 18, 2020, and renews automatically each year for additional one-year terms. The current term expires on March 18, 2022. The agreement also will terminate on the date that the Taglich Founding Investors or Taglich Equity Investors, each as defined, no longer collectively own 50% of the equity securities owned by either of them on March 18, 2013. On September 21, 2021, the Company issued common stock in an offering exempt from registration under the Securities Act of 1933. Taglich Brothers, Inc. acted as placement agent in this offering and received selling commissions equal to 8% of the gross proceeds, approximately, and expenses of $44 thousand. Taglich Brothers also received warrants to purchase 156,320 shares of common stock, exercisable for five years, at a price per share of $3.12. Beginning in February 2021, the Company began utilizing the services of Engauge Workforce Solutions LLC (“Engauge”), a manufacturing and distribution staffing agency. Ms. Kim Korth, a member of the Company’s Board of Directors, is also the Managing Director of Engauge. In March 2021, the Company entered into an agreement with Engauge for its services. The agreement is for an initial term of 12 months and will continue on a month-to-month basis after the initial term. The Company may terminate the agreement, without penalty, following the initial term with 60 days written notice. The Company has incurred fees for Engauge’s services through December 31, 2021 of $0.8 million. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Financial instruments consist of cash equivalents, accounts receivable, accounts payable, and debt. The carrying amount of all significant financial instruments approximates fair value due to either the short maturity or the existence of variable interest rates that approximate prevailing market rates. Accounting standards require certain other items be reported at fair value in the financial statements and provides a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes the valuation techniques and inputs used to measure fair value. Fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Company can access. Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. Level 2 inputs may include quoted prices for similar items in active markets, and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related item. Level 3 fair value measurements are based primarily on management’s own estimates using inputs such as pricing models, discounted cash flow methodologies or similar techniques considering the characteristics of the item. In instances whereby inputs used to measure fair value fall into different levels of the fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of specific inputs to these fair value measurements requires judgment and considers factors specific to each item. The Company measures its interest rate swap at fair value on a recurring basis based primarily on Level 2 inputs using an income model based on disparity between variance and fixed interest rates, the scheduled balance of principal outstanding, yield curves, and other information readily available in the market. The Company assesses goodwill for impairment on at least an annual basis, and more frequently whenever events or changes in circumstances indicate a potential impairment. The quantitative goodwill impairment analysis is based on Level 3 inputs, including forecasted EBITDA margins and future cash flows. Please refer to Note 7 for more information on the Company’s goodwill impairment analysis completed as of September 30, 2021. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | ContingenciesThe Company is engaged from time to time in legal matters and proceedings arising out of its normal course of business. The Company establishes a liability related to its legal proceedings and claims when it has determined that it is probable that the Company has incurred a liability and the related amount can be reasonably estimated. If the Company determines that an obligation is reasonably possible, the Company will, if material, disclose the nature of the loss contingency and the estimated range of possible loss, or include a statement that no estimate of loss can be made. While uncertainties are inherent in the outcome of such matters, the Company believes that there are no pending proceedings in which the Company is currently involved that will have a material effect on its financial position, results of operations, or cash flow. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing the net income by the weighted-average number of shares outstanding during the period. Diluted earnings per share is computed giving effect to all potentially weighted average dilutive shares including stock options and warrants. The dilutive effect of outstanding awards, if any, is reflected in diluted earnings per share by application of the treasury stock method. The following table sets forth the reconciliation of the numerator and denominator of basic and diluted loss per share: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands, except per share data) Numerator: Net (loss) $ (6,963) $ (5,710) Denominator: Weighted average shares outstanding, basic 10,320 9,779 Dilutive effect of stock-based awards — — Weighted average shares outstanding, diluted 10,320 9,779 Basic loss per share $ (0.67) $ (0.58) Diluted loss per share $ (0.67) $ (0.58) The effect of certain common stock equivalents were excluded from the computation of weighted average diluted shares outstanding for the twelve months ended December 31, 2021 and twelve months ended December 31, 2020, as inclusion would have resulted in anti-dilution. A summary of these anti-dilutive common stock equivalents is provided in the table below: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 Number of options 846,731 726,500 Exercise price of options $2.08 - $12.58 $2.36 - $12.58 Warrants (1) 156,320 — Exercise price of warrants $ 3.12 — ________________________________ (1) Includes warrants to purchase 156,320 shares of common stock issued to the underwriters of the Company’s equity issuance in September 2021 with an exercise price of $3.12 per share of common stock, which expire on September 21, 2026. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Principles of Consolidation | Principles of Consolidation. The consolidated financial statements include the accounts of the Company and all subsidiaries over which the Company exercises control. All inter-company transactions and balances have been eliminated upon consolidation. |
Cash and Cash Equivalents and Accounts Payable | Cash and Cash Equivalents. The Company considers all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. The carrying value of cash and cash equivalents approximate fair value. |
Accounts Receivable | Accounts Receivable . Accounts receivable are stated at the invoiced amount and do not bear interest. The allowance for doubtful accounts is management’s best estimate of the amount of probable collection in full of the existing accounts receivable. Management determines the allowance based on historical write off experience and an understanding of individual customer payment history and financial condition. Management reviews the allowance for doubtful accounts at regular intervals. Account balances are charged off against the allowance when management determines it is probable the receivable will not be recovered. The allowance for doubtful accounts was $1.3 million at December 31, 2021 and $1.2 million at December 31, 2020. |
Inventory | Inventories. Inventories are stated at the lower of cost or net realizable value, with cost determined on the first in, first out method (FIFO). The value of inventories is reduced for excess and obsolescence based on management's review of on-hand inventories compared to historical and estimated future sales and usage. The allowance for inventory valuation was $1.2 million and $0.4 million at December 31, 2021 and December 31, 2020, respectively. |
Valuation of Long-Lived Assets | Valuation of Long-Lived Assets. The carrying value of long-lived assets held for use is periodically evaluated when events or circumstances warrant such a review. The carrying value of a long-lived asset held for use is considered impaired when the anticipated separately identifiable undiscounted cash flows from the asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. During the third quarter of 2021, the Company identified indicators of impairment, the most impactful being the decline in sales to our automotive customers, as North American automotive production volumes continued to decrease. The Company compared the carrying value of long-lived assets (excluding goodwill) to the cumulative undiscounted cash flows and concluded no assets other than goodwill were impaired. The Company determined that no impairment indicators were evident, and all originally assigned useful lives remained appropriate during the year ended December 31, 2020. |
Property, Plant, and Equipment | Property, Plant, and Equipment. Property, plant, and equipment purchases are recorded at cost. Depreciation is calculated using the straight-line method over the estimated useful life of each asset. Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the period of the related leases. Upon retirement or disposal, the initial cost or valuation and accumulated depreciation are removed from the accounts, and any gain or loss is included in the statement of operations. |
Intangible Assets | Intangible Assets . The Company does not hold any intangible assets with indefinite lives. Identifiable intangible assets recognized as part of a business combination are recorded at their estimated fair value at the time of the business combination. |
Goodwill | Goodwill . Goodwill represents the excess of the acquisition cost of consideration transferred over the fair value of the identifiable net assets acquired and liabilities assumed from business combinations at the date of acquisition. Goodwill is not amortized, but rather is assessed at least on an annual basis for impairment. If it is determined that it is more likely than not that the fair value is greater than the carrying value of a reporting unit then a qualitative assessment may be used for the annual impairment test. Otherwise, a one-step process is used which requires estimating the fair value of each reporting unit compared to its carrying value. If the carrying value exceeds the estimated fair value, goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The Company has one reporting and operating unit for goodwill testing purposes. The Company experienced a sustained decline in market capitalization during the third quarter of 2021 representing a potential indicator of impairment. Furthermore, the Company continues to experience the repercussions from the global semiconductor shortage. The most impactful being the decline in sales to our automotive customers, as North American automotive production volumes continue to decrease. The Company identified these circumstances and concluded it was more likely than not the fair value of the goodwill was impaired and performed an interim quantitative assessment. The quantitative assessment was performed as of September 30, 2021, utilizing a combination of the income and market approaches. The discounted cash flow method was used to determine the fair value of the reporting unit under the income approach. Key assumptions used in the discounted cash flow analysis included a discount rate of 14.8%, forecasted revenue for the 2022 through 2025, a terminal growth rate for cash flows of 3%, and EBITDA margin of 10.8% by 2025. The guideline public company method was used to determine the fair value of the reporting unit under the market approach. Key assumptions used in this method included revenue and EBITDA multiples for each guideline company. The results of the quantitative analysis performed indicated the carrying value of the reporting unit exceeded the fair value of the reporting unit as of September 30, 2021. As a result, the Company recorded a $5.1 million impairment charge on the consolidated statement of operations for the twelve months ended December 31, 2021. The Company performed its annual assessment of goodwill as of October 1, the assessment concluded no further impairment. The annual assessment of goodwill performed compared the expected financial results used in the most recent quantitative assessment to finalized expectations resulting from the 2021 annual planning process. The Company also performed an interim qualitative assessment as of December 31, 2021, which concluded no impairment. The interim assessment considered fourth quarter results compared to expectations, the status of the automotive industry and volume forecasts, and other qualitative factors. |
Debt Issuance Costs | Debt Issuance Costs. Debt issuance costs represent legal, consulting, and other financial costs associated with debt financing and are reported netted against the related debt instrument. Amounts paid to or on behalf of lenders are presented as debt discount, as a reduction of the noted debt instrument. Debt issuance costs on term debt are amortized using the straight-line basis over the term of the related debt (which is immaterially different from the required effective interest method) while those related to revolving debt are amortized using a straight-line basis over the term of the related debt. |
Investments | Investments. Financial Accounting Standards Board (“FASB”) guidance requires certain equity securities to be measured at fair value, with changes in fair value recognized in earnings. For equity securities without readily determinable fair values, entities may elect to measure these securities at cost minus impairment, if any, adjusted for changes in observable prices. The Company has a cost method investment in its consolidated financial statements, and there is not a readily determinable value for this investment. Impairment losses due to a decline in the value of the investment that is other than temporary are recognized when incurred. |
Stock Based Compensation | Stock Based Compensation. The Company accounts for its stock-based compensation using the fair value of the award estimated at the grant date of the award. The Company estimates the fair value of awards, consisting of stock options, using the Black Scholes option pricing model. Compensation expense is recognized in earnings using the straight-line method over the vesting period, which represents the requisite service period. The Company accounts for forfeitures as they occur. |
Revenue Recognition | Revenue Recognition. Revenue is measured based on consideration specified in a contract with a customer, and excludes any sales incentives and amounts collected on behalf of third parties. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. General Recognition Policy Revenue is recognized by the Company once all performance obligations under the terms of a contract with the Company's customers are satisfied. Generally, this occurs with the transfer of control of its automotive, HVAC, and other products. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring its products. The Company’s payment terms vary by the type and location of its customers and the products offered. The term between invoicing and when payment is due is not significant. In general, for sales arrangements, the Company deems control to transfer at a single point in time and recognizes revenue when it ships products from its manufacturing facilities to its customers. Once a product has shipped, the customer is able to direct the use of, and obtain substantially all of the remaining benefits from, the asset. The Company considers control to transfer upon shipment because the Company has a present right to payment at that time, the customer has legal title to the asset, and the customer has significant risks and rewards of ownership of the asset. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. Contract Balances The timing of revenue recognition, billings, and cash collections and payments results in billed accounts receivable. The Company does not have deferred revenue. Additionally, as noted in the Accounts Receivable section of Note 2, Summary of Significant Accounting Policies , management reviews the allowance for doubtful accounts at regular intervals. Account balances are charged off against the allowance when management determines it is probable the receivable will not be recovered. The allowance for doubtful account balances are noted in the Accounts Receivable section of Note 2. Practical Expedients The Company elects the practical expedient to expense costs incurred to obtain a contract with a customer when the amortization period would have been one year or less. These costs include sales commissions as the Company has determined annual compensation is commensurate with annual sales activities. The Company elects the practical expedient that does not require the Company to adjust consideration for the effects of a significant financing component when the period between shipment of its products and customer’s payment is one year or less. |
Shipping and Handling | Shipping and Handling. Shipping and handling costs are included in cost of sales as they are incurred. |
Income Taxes | Income Taxes. A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the period. Deferred tax liabilities or assets are recognized for the estimated future tax effects of temporary differences between financial reporting and tax accounting measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company also evaluates the need for valuation allowances to reduce the deferred tax assets to realizable amounts. Management evaluates all positive and negative evidence and uses judgment regarding past and future events, including operating results, to help determine when it is more likely than not that all or some portion of the deferred tax assets may not be realized. When appropriate, a valuation allowance is recorded against deferred tax assets to reserve for future tax benefits that may not be realized. |
Foreign Currency Adjustments/Foreign Currency Exchange | Foreign Currency Adjustments. The Company’s functional currency for all operations worldwide is the United States dollar. Nonmonetary assets and liabilities of foreign operations are remeasured at historical rates and monetary assets and liabilities are remeasured at exchange rates in effect at the end of each reporting period. Income statement accounts are remeasured at average exchange rates for the year. Gains and losses from translation of foreign currency financial statements into United States dollars are classified in other income in the consolidated statements of operations. Foreign Currency Exchange The expression of assets and liabilities in a currency other than the functional currency, which is the United States dollar, gives rise to exchange gains and losses when such assets and obligations are paid in another currency. Foreign currency exchange rate adjustments (i.e., differences between amounts recorded and actual amounts owed or paid) are reported in the consolidated statements of operations as the foreign currency fluctuations occur. Foreign currency exchange rate adjustments are reported in the consolidated statements of operations using the exchange rates in effect at the time of the transaction. At December 31, 2021, the Company’s exposure to assets and liabilities denominated in another currency was not significant. To the extent there is a fluctuation in the exchange rates, the amount of local currency to be paid or received to satisfy foreign currency obligations in 2022 may increase or decrease. |
Derivative financial instruments | Derivative financial instruments. All derivative instruments are required to be reported on the consolidated balance sheets at fair value unless the transactions qualify and are designated as normal purchases or sales. Changes in fair value are reported currently through earnings unless they meet hedge accounting criteria. |
Use of Estimates | Use of Estimates. The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Examples include allowances for doubtful accounts and sales returns, allowances for inventory obsolescence, useful lives of depreciable assets, fixed asset and goodwill impairment analyses, valuation allowances for deferred tax assets, stock options, and financial instruments. Actual results could differ from those estimates. |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The following table presents the Company's net sales disaggregated by major sales channel for the twelve months ended December 31, 2021 and December 31, 2020: Twelve Months Ended Twelve Months Ended (dollars in thousands) Net Sales Transportation $ 111,229 $ 105,463 Appliance 12,160 11,302 Other 2,280 3,449 Total $ 125,669 $ 120,214 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Inventories consist of the following: December 31, 2021 December 31, 2020 (dollars in thousands) Raw materials $ 9,242 $ 7,366 Work in progress 990 1,225 Finished goods 3,538 3,360 Total inventory $ 13,770 $ 11,951 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant, and equipment, net consists of the following: December 31, 2021 December 31, 2020 Depreciable (dollars in thousands) Land $ 538 $ 538 Buildings 7,630 6,923 23 - 40 Shop equipment 26,049 23,436 7 - 10 Leasehold improvements 1,283 1,245 3 - 10 Office equipment 3,047 2,331 3 - 7 Mobile equipment 50 152 3 Construction in progress 1,554 2,315 Total cost 40,151 36,940 Accumulated depreciation 17,584 14,557 Property, plant, and equipment, net $ 22,567 $ 22,383 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | Changes in the carrying value of goodwill are as follows: (dollars in thousands) Balance at December 31, 2020 Goodwill $ 28,871 Accumulated impairment losses (6,760) Net beginning balance 22,111 Goodwill impairment (5,115) Balance at December 31, 2021 $ 16,996 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Intangible assets of the Company consist of the following at December 31, 2021: Gross Carrying Accumulated Weighted Average (dollars in thousands) Customer contracts $ 26,518 $ 23,887 8.16 Trade names 4,673 2,143 16.43 Non-compete agreements 1,162 1,162 2.53 Unpatented technology 1,534 1,534 5.00 Total $ 33,887 $ 28,726 Intangible assets of the Company consist of the following at December 31, 2020: Gross Carrying Accumulated Weighted Average (dollars in thousands) Customer contracts $ 26,518 $ 21,719 8.16 Trade names 4,673 1,924 16.43 Non-compete agreements 1,162 1,162 2.53 Unpatented technology 1,534 1,477 5.00 Total $ 33,887 $ 26,282 |
Schedule of amortization expense | Estimated amortization expense for the next five years is as follows: Estimated Amortization Expense (dollars in thousands) 2022 $ 1,305 2023 979 2024 759 2025 573 2026 223 Thereafter 1,322 Total $ 5,161 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | The Company’s long-term debt consists of the following: December 31, 2021 December 31, 2020 (dollars in thousands) U.S. Small Business Administration Paycheck Protection Program loan (PPP Note), payable in equal monthly installments on the first day after the deferment period. The PPP Note was unsecured and bore interest at 1% per annum. The PPP Note was forgiven during the third quarter of 2021. $ — $ 5,999 US Term Loan, payable to lenders in quarterly installments of $0.8 million through November 7, 2023, with a lump sum due at maturity. The effective interest rate was 5.50% and 5.25% per annum at December 31, 2021, and December 31, 2020, respectively. At December 31, 2021, the balance of the New US Term Loan is presented net of a debt discount of $0.1 million from costs paid to or on behalf of the lenders. 20,383 22,768 CA Term Loan, payable to lenders in quarterly installments of $0.4 million through November 7, 2023, with a lump sum due at maturity. The effective interest rate was 5.50% and 5.25% per annum at December 31, 2021 and December 31, 2020, respectively. At December 31, 2021, the balance of the CA Term Loan is presented net of a debt discount of $0.1 million from costs paid to or on behalf of the lenders. 7,437 8,876 Capital expenditure line payable to lenders in quarterly installments of 12.5% of the outstanding principal balance per annum through November 7, 2023, with a lump sum due at maturity. The effective interest rate was 5.50% and 5.25% per annum at December 31, 2021 and December 31, 2020, respectively. 1,064 1,220 Total debt excluding Revolver 28,884 38,863 |
Schedule of minimum borrowers liquidity | The Second Amendment to the Forbearance Agreement eliminated the Minimum Liquidity covenant of the previous Amendment to the Forbearance Agreement as well as of the Credit Agreement and replaced it with the following: Date of Determination Minimum Liquidity December 31, 2021 $3,000,000 January 31, 2022 $3,000,000 February 28, 2022 $3,000,000 |
Schedule of minimum consolidated EBITDA | The Second Amendment to the Forbearance Agreement eliminated the Minimum Consolidated EBITDA covenant of the previous Amendment to the Forbearance Agreement as well as of the Credit Agreement and replaced it with the following: Date of Determination Measurement Period Minimum Consolidated EBITDA December 31, 2021 Trailing 12 months $4,100,000 January 31, 2022 Trailing 12 months $4,200,000 February 20, 2022 Trailing 12 months $4,700,000 |
Schedule of maturities of long-term debt | Maturities on the Company’s Amended and Restated Credit Agreement and other long term-debt obligations for the remainder of the current fiscal year and future fiscal years: Future Maturities (dollars in thousands) 2022 $ 48,860 2023 — Total 48,860 Discounts (187) Debt issuance costs (248) Total debt, net $ 48,425 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Liability | The table below summarizes the activity in the restructuring liability for the twelve months ended December 31, 2020: Employee Termination Benefits Liability Other Exit Costs Liability Total (dollars in thousands) Accrual balance at December 29, 2019 $ 438 $ 116 $ 554 Provision for estimated expenses incurred during the year — 1,230 1,230 Payments made during the year 438 671 1,109 Asset impairments and other — 675 675 Accrual balance at December 31, 2020 $ — $ — $ — |
Stock Incentive Plans (Tables)
Stock Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of share-based payment award, stock options, valuation assumptions | May 4, 2021 June 11, 2021 December 3, 2021 Expected volatility 53.76 % 57.77 % 64.26 % Dividend yield — % — % — % Expected term (in years) 6 5 6 Risk-free rate 1.05 % 0.96 % 1.21 % |
Schedule of share-based compensation, stock options and stock appreciation rights award activity | A summary of option activity under both plans is presented below: Number of Shares Weighted Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (1) (dollars in thousands, except share data and exercise price) Outstanding at December 31, 2020 726,500 $ 4.53 7.2 $ 1,484 Granted 262,475 $ 3.83 5.0 $ — Exercised — $ — 0.0 $ — Forfeited or expired 142,244 $ 9.73 0.0 $ — Outstanding at December 31, 2021 846,731 $ 4.00 7.6 $ — Vested and exercisable at December 31, 2021 384,858 $ 4.85 6.6 $ — ________________________________________ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of income before income tax, domestic and foreign | Income before income taxes for U.S. and Non-U.S. operations are as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) U.S. (loss) income $ (6,809) $ (11,274) Non-U.S. income (1,006) 1,780 (Loss) income before income taxes $ (7,815) $ (9,494) |
Schedule of components of income tax expense (benefit) | The components of the income tax provision included in the consolidated statements of operations are all attributable to continuing operations and are detailed as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) Current tax expense: Federal $ (333) $ (2,918) State 51 42 Foreign 916 631 Total 634 (2,245) Deferred tax expense: Federal — (1,236) State — (83) Foreign (1,486) (220) Total (1,486) (1,539) Total income tax expense $ (852) $ (3,784) |
Schedule of current and noncurrent deferred taxes | The following table summarizes the components of temporary differences and carryforwards that give rise to deferred tax assets and liabilities: December 31, 2021 December 31, 2020 (dollars in thousands) Deferred tax assets (liabilities): Allowance for doubtful accounts $ 298 $ 345 Inventories 296 99 Accrued payroll and benefits 418 513 Goodwill and intangible assets 2,135 951 Excess interest expense 1,090 447 Tax credits and NOLs 3,226 1,427 Lease liabilities 2,412 2,604 Other 300 339 Deferred tax asset before valuation allowance 10,175 6,725 Valuation allowance (3,354) (684) Deferred tax asset 6,821 6,041 Property, plant, and equipment (1,975) (2,544) Lease assets (2,348) (2,495) Other (119) (109) Deferred tax liability (4,442) (5,148) Total deferred tax asset (liability) $ 2,379 $ 893 |
Schedule of income taxes based on federal tax rate | A reconciliation of taxes on income from continuing operations based on the statutory federal income tax rate to the provision for income taxes is as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) Income tax expense (benefit) at US Statutory Tax Rate $ (1,641) $ (1,994) State income tax (benefit) expense, net of federal benefit (167) (31) Foreign tax rate differential 1 155 U.S. Tax on non-U.S. income — (561) Goodwill impairment 156 — Research and Development credits (150) (269) Assets Basis Adjustment (650) — NOL carryback — (1,037) Valuation allowance 2,670 63 PPP loan forgiveness (1,396) — Other 325 (110) Total provision for income taxes $ (852) $ (3,784) |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Operating lease assets and liabilities | Leased assets and liabilities included within the consolidated balance sheets consist of the following: Classification December 31, 2021 December 31, 2020 (dollars in thousands) Right-of-Use-Assets Operating Operating Leases $ 9,776 $ 10,415 Liabilities Current Operating Other accrued liabilities $ 1,812 $ 2,309 Non-current Operating Other long term liabilities 8,648 8,911 Total lease liabilities $ 10,460 $ 11,220 |
Schedule of operating lease liability maturity | Maturity of the Company’s lease liabilities as of December 31, 2021 is as follows: Estimated Future Lease Liability Maturities (dollars in thousands) 2022 $ 2,426 2023 1,756 2024 1,669 2025 1,660 2026 1,471 Thereafter 4,225 Total lease payments 13,207 Less: interest 2,747 Present value of lease payments $ 10,460 |
Lease remaining term and discount rate | Remaining lease term and discount rates are as follows: December 31, 2021 December 31, 2020 Weighted average remaining lease term (years) 7 7 Weighted average discount rate 6.52 % 6.39 % |
Lease costs included in cash flow statement | Lease costs included in the consolidated statements of cash flows are as follows: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands) Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows from operating leases $ 2,981 $ 3,335 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the reconciliation of the numerator and denominator of basic and diluted loss per share: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 (dollars in thousands, except per share data) Numerator: Net (loss) $ (6,963) $ (5,710) Denominator: Weighted average shares outstanding, basic 10,320 9,779 Dilutive effect of stock-based awards — — Weighted average shares outstanding, diluted 10,320 9,779 Basic loss per share $ (0.67) $ (0.58) Diluted loss per share $ (0.67) $ (0.58) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | A summary of these anti-dilutive common stock equivalents is provided in the table below: Twelve Months Ended December 31, 2021 Twelve Months Ended December 31, 2020 Number of options 846,731 726,500 Exercise price of options $2.08 - $12.58 $2.36 - $12.58 Warrants (1) 156,320 — Exercise price of warrants $ 3.12 — ________________________________ (1) Includes warrants to purchase 156,320 shares of common stock issued to the underwriters of the Company’s equity issuance in September 2021 with an exercise price of $3.12 per share of common stock, which expire on September 21, 2026. |
Nature of Business and Basis _2
Nature of Business and Basis of Presentation (Details) $ / shares in Units, $ in Thousands | Sep. 21, 2021USD ($)$ / sharesshares | Dec. 31, 2021USD ($)segment$ / shares | Dec. 31, 2020USD ($)$ / shares |
Debt Instrument [Line Items] | |||
Number of reportable segments | segment | 1 | ||
Revolver, current maturities | $ 19,541 | $ 11,494 | |
Issuance of common stock and warrants (in shares) | shares | 1,954,000 | ||
Shares issued, price per share (in USD) | $ / shares | $ 2.25 | ||
Issuance of common stock and warrants | $ 4,400 | 3,837 | |
Proceeds from issuance of common stock and warrants | $ 4,044 | $ 0 | |
Exercise price of warrants (in dollars per share) | $ / shares | $ 3.12 | $ 0 | |
Taglich Brothers, Inc. | |||
Debt Instrument [Line Items] | |||
Proceeds from issuance of common stock and warrants | $ 4,000 | ||
Percentage of payment of selling commissions | 8.00% | ||
Payment of placement agent offering costs | $ 44 | ||
Number of warrants purchased (in shares) | shares | 156,320 | ||
Warrants and rights outstanding | 5 years | ||
Exercise price of warrants (in dollars per share) | $ / shares | $ 3.12 | ||
Line of credit | Amended And Restated Credit Agreement | |||
Debt Instrument [Line Items] | |||
Revolver, current maturities | $ 48,400 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | 12 Months Ended | |
Dec. 31, 2021USD ($)reporting_unit | Dec. 31, 2020USD ($) | |
Concentration Risk [Line Items] | ||
Allowance for doubtful accounts | $ 1,300,000 | $ 1,200,000 |
Allowance for inventory valuation | $ 1,200,000 | 400,000 |
Number of reporting units for goodwill testing purposes | reporting_unit | 1 | |
Impairment | $ 5,115,000 | 0 |
Dividend income | 100,000 | 100,000 |
Impairment loss | 0 | 0 |
Unrecognized tax benefits | 0 | 0 |
Income tax penalties and interest | $ 0 | $ 0 |
Percent of employees | 4.00% | |
United States | ||
Concentration Risk [Line Items] | ||
Percent of employees | 54.00% | |
Mexico | ||
Concentration Risk [Line Items] | ||
Percent of employees | 42.00% | |
Canada | ||
Concentration Risk [Line Items] | ||
Percent of employees | 31.00% | |
Geographic concentration risk | Sales revenue, net | Mexico | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 25.00% | 23.00% |
Geographic concentration risk | Sales revenue, net | Canada | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 9.00% | 8.00% |
Geographic concentration risk | Production risk | Mexico | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 25.00% | 22.00% |
Geographic concentration risk | Production risk | Canada | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 9.00% | 9.00% |
General Motors Company | Customer concentration risk | Sales revenue, net | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 7.00% | 9.00% |
General Motors Company | Customer concentration risk | Accounts receivable | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 13.00% | |
Stellantis | Customer concentration risk | Sales revenue, net | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 7.00% | 6.00% |
Ford Motor Company | Customer concentration risk | Sales revenue, net | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 4.00% | 6.00% |
Yanfeng Automotive Interiors | Customer concentration risk | Sales revenue, net | ||
Concentration Risk [Line Items] | ||
Concentration risk (percentage) | 8.00% | 6.00% |
Discount Rate | Discounted Cash Flow | ||
Concentration Risk [Line Items] | ||
Goodwill fair value measurement assumptions (percent) | 0.148 | |
Terminal Growth Rate | Discounted Cash Flow | ||
Concentration Risk [Line Items] | ||
Goodwill fair value measurement assumptions (percent) | 0.03 | |
EBITDA Margin | Discounted Cash Flow | ||
Concentration Risk [Line Items] | ||
Goodwill fair value measurement assumptions (percent) | 0.108 |
New Accounting Pronouncements (
New Accounting Pronouncements (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Jan. 01, 2020 |
Lessee, Lease, Description [Line Items] | |||
Operating leases | $ 9,776 | $ 10,415 | |
Present value of lease payments | 10,460 | ||
Total lease liabilities | $ 10,460 | $ 11,220 | |
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases | $ 12,100 | ||
Present value of lease payments | $ 12,800 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Net Sales | $ 125,669 | $ 120,214 |
Transportation | ||
Disaggregation of Revenue [Line Items] | ||
Net Sales | 111,229 | 105,463 |
Appliance | ||
Disaggregation of Revenue [Line Items] | ||
Net Sales | 12,160 | 11,302 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Net Sales | $ 2,280 | $ 3,449 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 9,242 | $ 7,366 |
Work in progress | 990 | 1,225 |
Finished goods | 3,538 | 3,360 |
Total inventory | $ 13,770 | $ 11,951 |
Inventories - Narrative (Detail
Inventories - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Inventory [Line Items] | ||
Allowance for inventory valuation | $ 1,200 | $ 400 |
Inventories, net | 13,770 | 11,951 |
Mexico | ||
Inventory [Line Items] | ||
Inventories, net | 4,000 | 3,100 |
Canada | ||
Inventory [Line Items] | ||
Inventories, net | $ 1,100 | $ 1,100 |
Property, Plant, and Equipmen_3
Property, Plant, and Equipment, Net - Schedule of Property, Plant, and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 40,151 | $ 36,940 |
Accumulated depreciation | 17,584 | 14,557 |
Property, plant, and equipment, net | 22,567 | 22,383 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 538 | 538 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 7,630 | 6,923 |
Buildings | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 23 years | |
Buildings | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 40 years | |
Shop equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 26,049 | 23,436 |
Shop equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 7 years | |
Shop equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 10 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 1,283 | 1,245 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 3 years | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 10 years | |
Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 3,047 | 2,331 |
Office equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 3 years | |
Office equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 7 years | |
Mobile equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 50 | 152 |
Mobile equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable Life – Years | 3 years | |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 1,554 | $ 2,315 |
Property, Plant, and Equipmen_4
Property, Plant, and Equipment, Net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 3,200 | $ 3,000 |
Property, plant, and equipment, net | 22,567 | 22,383 |
Mexico | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, net | 3,500 | 3,700 |
Canada | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, net | $ 400 | $ 400 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | |
Goodwill [Roll Forward] | ||
Goodwill | $ 28,871 | |
Accumulated impairment losses | (6,760) | |
Goodwill, Beginning Balance | $ 22,111 | |
Goodwill impairment | (5,115) | 0 |
Goodwill, Ending Balance | 16,996 | 22,111 |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impairment | $ 5,115 | $ 0 |
Discounted Cash Flow | Discount Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Goodwill fair value measurement assumptions (percent) | 0.148 | |
Discounted Cash Flow | Terminal Growth Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Goodwill fair value measurement assumptions (percent) | 0.03 | |
Discounted Cash Flow | EBITDA Margin | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Goodwill fair value measurement assumptions (percent) | 0.108 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of intangible assets by major class (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 33,887 | $ 33,887 |
Accumulated Amortization | 28,726 | 26,282 |
Amortization expense | $ 2,400 | 4,000 |
Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life – Years | 8 years 11 months 15 days | |
Customer contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 26,518 | 26,518 |
Accumulated Amortization | $ 23,887 | $ 21,719 |
Customer contracts | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life – Years | 8 years 1 month 28 days | 8 years 1 month 28 days |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 4,673 | $ 4,673 |
Accumulated Amortization | $ 2,143 | $ 1,924 |
Trade names | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life – Years | 16 years 5 months 4 days | 16 years 5 months 4 days |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,162 | $ 1,162 |
Accumulated Amortization | $ 1,162 | $ 1,162 |
Non-compete agreements | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life – Years | 2 years 6 months 10 days | 2 years 6 months 10 days |
Unpatented technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,534 | $ 1,534 |
Accumulated Amortization | $ 1,534 | $ 1,477 |
Unpatented technology | Weighted Average | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life – Years | 5 years | 5 years |
Intangible Assets - Finite-live
Intangible Assets - Finite-lived intangible assets, future amortization expense schedule (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2022 | $ 1,305 | |
2023 | 979 | |
2024 | 759 | |
2025 | 573 | |
2026 | 223 | |
Thereafter | 1,322 | |
Total | $ 5,161 | $ 7,605 |
Long-term Debt - Schedule of lo
Long-term Debt - Schedule of long-term debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||
Unamortized discount | $ 187 | $ 285 |
Total debt excluding Revolver | 28,884 | 38,863 |
Line of credit for capital expenditures | ||
Debt Instrument [Line Items] | ||
Total debt excluding Revolver | $ 1,064 | 1,220 |
Line of credit | PPP under CARES Act | Secured debt | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 1.00% | |
Total debt excluding Revolver | $ 0 | $ 5,999 |
Line of credit | New US Term Loan | Secured debt | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 5.50% | 5.25% |
Unamortized discount | $ 100 | |
Total debt excluding Revolver | $ 20,383 | $ 22,768 |
Line of credit | CA term loan | Secured debt | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 5.50% | 5.25% |
Total debt excluding Revolver | $ 7,437 | $ 8,876 |
Line of credit | October 1, 2021 through November 7, 2023 | New US Term Loan | Secured debt | ||
Debt Instrument [Line Items] | ||
Principal payment amount | 800 | |
Line of credit | October 1, 2021 through November 7, 2023 | CA term loan | Secured debt | ||
Debt Instrument [Line Items] | ||
Principal payment amount | 400 | |
Unamortized discount | $ 100 | |
Line of credit | October 1, 2021 through November 7, 2023 | Line of credit for capital expenditures | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 5.50% | 5.25% |
Percent of principal payment | 12.50% |
Long-term Debt - Narrative (Det
Long-term Debt - Narrative (Details) | Dec. 09, 2021USD ($) | Jun. 14, 2021 | Apr. 24, 2020USD ($) | Nov. 08, 2018USD ($) | Dec. 31, 2021USD ($)facility | Dec. 31, 2020USD ($) | Dec. 08, 2021USD ($) | Sep. 21, 2021USD ($) | Sep. 20, 2021USD ($) |
Debt Instrument [Line Items] | |||||||||
Total debt excluding Revolver | $ 28,884,000 | $ 38,863,000 | |||||||
Debt issuance costs | 248,000 | 376,000 | |||||||
Unamortized discount | 187,000 | 285,000 | |||||||
Amortization of debt issuance costs | 226,000 | 189,000 | |||||||
Gain on forgiveness of debt | 6,000,000 | 0 | |||||||
Commercial Paper | PPP under CARES Act | |||||||||
Debt Instrument [Line Items] | |||||||||
Gain on forgiveness of debt | $ 6,000,000 | 6,000,000 | |||||||
Interest rate | 1.00% | ||||||||
Interest payable | $ 100,000 | ||||||||
Revolving credit facility | Line of credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 25,000,000 | $ 27,000,000 | $ 27,000,000 | $ 30,000,000 | |||||
Amended And Restated Credit Agreement | |||||||||
Debt Instrument [Line Items] | |||||||||
Minimum debt service coverage ratio | 1.20 | ||||||||
Amended And Restated Credit Agreement | Fiscal Quarter Ending September 30, 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio | 3.75 | ||||||||
Amended And Restated Credit Agreement | Fiscal Quarter Ending December 31, 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio | 3.50 | ||||||||
Amended And Restated Credit Agreement | Fiscal Quarter Ending March 31, 2021 | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio | 3.25 | ||||||||
Amended And Restated Credit Agreement | Fiscal Quarter Ending June 30, 2021 | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio | 3.25 | ||||||||
Amended And Restated Credit Agreement | Fiscal Quarter Thereafter | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio | 3 | ||||||||
Amended And Restated Credit Agreement | Line of credit | Secured debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 73,000,000 | ||||||||
Amended And Restated Credit Agreement | Line of credit | Secured debt | Base Rate | Minimum | PPP under CARES Act | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 2.00% | ||||||||
Amended And Restated Credit Agreement | Line of credit | Secured debt | London Interbank Offered Rate (LIBOR) | Minimum | PPP under CARES Act | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 1.00% | ||||||||
CA term loan | Line of credit | Secured debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Total debt excluding Revolver | $ 7,437,000 | $ 8,876,000 | |||||||
Effective interest rate | 5.50% | 5.25% | |||||||
Line of credit for capital expenditures | |||||||||
Debt Instrument [Line Items] | |||||||||
Total debt excluding Revolver | $ 1,064,000 | $ 1,220,000 | |||||||
Credit agreement | Line of credit | Secured debt | Base Rate | Minimum | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 1.75% | ||||||||
Credit agreement | Line of credit | Secured debt | Base Rate | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 3.25% | ||||||||
Credit agreement | Line of credit | Secured debt | London Interbank Offered Rate (LIBOR) | Minimum | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 2.75% | ||||||||
Credit agreement | Line of credit | Secured debt | London Interbank Offered Rate (LIBOR) | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 4.25% | ||||||||
PPP under CARES Act | Line of credit | Secured debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Total debt excluding Revolver | $ 0 | $ 5,999,000 | |||||||
Effective interest rate | 1.00% | ||||||||
First Amendment To Forbearance Agreement | Line of credit | Secured debt | London Interbank Offered Rate (LIBOR) | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 4.50% | 4.25% | |||||||
New revolver | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term line of credit | $ 19,800,000 | ||||||||
New revolver | Line of credit | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 2,200,000 | ||||||||
Effective interest rate | 5.50% | ||||||||
Forbearance Agreement | Trailing 12 months | |||||||||
Debt Instrument [Line Items] | |||||||||
Limit to the excess above projected total cash disbursements (percent) | 15.00% | ||||||||
Forbearance Agreement | Line of credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Total cash disbursements | 15.00% | ||||||||
Forbearance Agreement | Line of credit | Secured debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument interest rate | 0.50% | ||||||||
Senior credit facility, second amendment | Line of credit | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Letters of credit outstanding, amount | $ 100,000 | ||||||||
Company's leased facilities | facility | 1 | ||||||||
Debt instrument, periodic payment | $ 411,000 | ||||||||
Unique Fabricating NA, Inc. And Unique-Intasco Canada, Inc. | Amended And Restated Credit Agreement | Line of credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, term | 5 years | ||||||||
Debt instrument, term to fund capital expenditures | 2 years | ||||||||
Unique Fabricating NA, Inc. And Unique-Intasco Canada, Inc. | Amended And Restated Credit Agreement | Line of credit | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 30,000,000 | ||||||||
Unique Fabricating NA, Inc. And Unique-Intasco Canada, Inc. | Amended And Restated Credit Agreement | Line of credit for capital expenditures | November 8, 2018 through November 8, 2019 | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | 2,500,000 | ||||||||
Unique Fabricating NA, Inc. And Unique-Intasco Canada, Inc. | Amended And Restated Credit Agreement | Line of credit for capital expenditures | November 9, 2019 through November 8, 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | 5,000,000 | ||||||||
Unique Fabricating NA, Inc. And Unique-Intasco Canada, Inc. | US term loan | Line of credit | Secured debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum increase to principal amount | 26,000,000 | ||||||||
Unique Fabricating NA, Inc. And Unique-Intasco Canada, Inc. | CA term loan | Line of credit | Secured debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Total debt excluding Revolver | $ 12,000,000 |
Long-term Debt - Schedule of Mi
Long-term Debt - Schedule of Minimum Borrowers Liquidity (Details) - Line of credit - Forbearance Agreement - Secured debt | Dec. 31, 2021USD ($) |
Date of Determination December 31, 2021 | |
Debt Instrument [Line Items] | |
Minimum Liquidity | $ 3,000,000 |
Date of Determination January 31, 2022 | |
Debt Instrument [Line Items] | |
Minimum Liquidity | 3,000,000 |
Date of Determination February 28, 2022 | |
Debt Instrument [Line Items] | |
Minimum Liquidity | $ 3,000,000 |
Long-term Debt - Minimum Consol
Long-term Debt - Minimum Consolidated EBITDA (Details) - Forbearance Agreement - Trailing 12 months | Dec. 31, 2021USD ($) |
Debt Instrument [Line Items] | |
Minimum Consolidated EBITDA | $ 4,100,000 |
Minimum Consolidated EBITDA | 4,200,000 |
Minimum Consolidated EBITDA | $ 4,700,000 |
Long-term Debt - Schedule of re
Long-term Debt - Schedule of repayment of maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
2022 | $ 48,860 | |
2023 | 0 | |
Total | 48,860 | |
Discounts | (187) | $ (285) |
Debt issuance costs | (248) | |
Total debt, net | $ 48,425 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Details) - Interest rate swap - Not designated as hedging instrument - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2018 | |
Derivatives, Fair Value [Line Items] | |||
Fixed interest rate | 3.075% | ||
Notional amount | $ 5 | ||
Derivative fair value, liabilities | $ 0.6 | $ 1.2 | |
Interest expense | |||
Derivatives, Fair Value [Line Items] | |||
Monthly settlements | $ 0.5 | $ 0.5 | |
Derivative Instrument, Periodic Payment, Installment Periods Through June Twenty Eight Two Thousand Nineteen | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 17.5 | ||
Notional amount quarterly increase | 0.4 | ||
Derivative Instrument, Periodic Payment, Installment Periods Until September Thirty Two Thousand Twenty | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 17.5 | ||
Notional amount quarterly decrease | 0.2 | ||
Derivative Instrument, Periodic Payment, Installment Periods Until December Thirty First Twenty Twenty One | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount quarterly decrease | 0.4 | ||
Derivative Instrument, Periodic Payment, Installment Periods Until November Eighth Twenty Twenty Three | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount quarterly decrease | $ 0.6 |
Restructuring - Liability (Deta
Restructuring - Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring Reserve [Roll Forward] | ||
Beginning balance | $ 0 | $ 554 |
Provision for estimated expenses incurred during the year | 0 | 1,230 |
Payments made during the year | 1,109 | |
Asset impairments and other | 675 | |
Ending balance | 0 | |
Employee Termination Benefits Liability | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | 0 | 438 |
Provision for estimated expenses incurred during the year | 0 | |
Payments made during the year | 438 | |
Asset impairments and other | 0 | |
Ending balance | 0 | |
Other Exit Costs Liability | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | $ 0 | 116 |
Provision for estimated expenses incurred during the year | 1,230 | |
Payments made during the year | 671 | |
Asset impairments and other | 675 | |
Ending balance | $ 0 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) $ in Millions | Jul. 16, 2019position | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Restructuring Cost and Reserve [Line Items] | |||
Workforce reduction due to plant closure | position | 47 | ||
Evansville Restructuring | |||
Restructuring Cost and Reserve [Line Items] | |||
Percentage of sublease secured | 78.00% | ||
Evansville Restructuring | All Restructuring Costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Amount of restructuring cost incurred | $ 0.6 | ||
Evansville Restructuring | Contract Termination Leased Facility Remaining Payments | |||
Restructuring Cost and Reserve [Line Items] | |||
Amount of restructuring cost incurred | $ 0.3 | $ 0.7 |
Stock Incentive Plans - Narrati
Stock Incentive Plans - Narrative (Details) $ / shares in Units, $ in Millions | Dec. 03, 2025 | May 04, 2025 | Dec. 03, 2024 | May 04, 2024 | Dec. 03, 2023 | May 04, 2023 | May 04, 2022 | Dec. 03, 2021d$ / sharesshares | Jun. 11, 2021$ / sharesshares | May 04, 2021$ / sharesshares | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 29, 2013shares | Jul. 31, 2020shares | Jun. 30, 2016shares | Jan. 04, 2015shares |
Selling, General and Administrative Expenses | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Allocated share-based compensation expense | $ | $ 0.4 | $ 0.1 | ||||||||||||||
Employee Stock Option | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Unrecognized compensation cost | $ | $ 0.6 | |||||||||||||||
Compensation cost, weighted average period (in years) | 3 years 9 months 18 days | |||||||||||||||
The 2013 Stock Incentive Plan | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Common stock shares reserved for future issuance (in shares) | shares | 495,000 | |||||||||||||||
Vested and exercisable (in dollars per share) | $ 2.08 | $ 3.31 | ||||||||||||||
Weighted average grant date fair value (dollars per share) | $ 0.46 | $ 1.64 | ||||||||||||||
The 2013 Stock Incentive Plan | Employee Stock Option | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Number of shares available for grant (in shares) | shares | 495,000 | |||||||||||||||
Expiration period | 10 years | |||||||||||||||
Number of shares authorized (in shares) | shares | 12,500 | 38,943 | ||||||||||||||
The 2013 Stock Incentive Plan | Employee Stock Option | Chief Financial Officer | Award vesting on grant date | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 50.00% | |||||||||||||||
Closing price of common stock for ten out of twenty consecutive trading days (in dollars per share) | $ 7.50 | |||||||||||||||
Threshold number of consecutive trading days | d | 10 | |||||||||||||||
Number of consecutive trading days in measurement period | d | 20 | |||||||||||||||
The 2013 Stock Incentive Plan | Employee Stock Option | Chief Financial Officer | Award vesting, first anniversary | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 50.00% | |||||||||||||||
Closing price of common stock for ten out of twenty consecutive trading days (in dollars per share) | $ 12.50 | |||||||||||||||
Threshold number of consecutive trading days | d | 10 | |||||||||||||||
Number of consecutive trading days in measurement period | d | 20 | |||||||||||||||
2014 Omnibus Performance Award Plan | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Number of shares authorized (in shares) | shares | 700,000 | 450,000 | 250,000 | |||||||||||||
Vested and exercisable (in dollars per share) | $ 2.08 | $ 4.51 | ||||||||||||||
Weighted average grant date fair value (dollars per share) | $ 1.22 | $ 2.28 | ||||||||||||||
2014 Omnibus Performance Award Plan | Employee Stock Option | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Number of shares authorized (in shares) | shares | 12,500 | 59,254 | 139,278 | |||||||||||||
Vested and exercisable (in dollars per share) | $ 3.31 | |||||||||||||||
Weighted average grant date fair value (dollars per share) | $ 1.64 | |||||||||||||||
2014 Omnibus Performance Award Plan | Employee Stock Option | Award vesting on grant date | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 40.00% | 20.00% | ||||||||||||||
2014 Omnibus Performance Award Plan | Employee Stock Option | Award vesting, first anniversary | Scenario, Forecast | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 20.00% | |||||||||||||||
2014 Omnibus Performance Award Plan | Employee Stock Option | Award vesting, second anniversary | Scenario, Forecast | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 20.00% | |||||||||||||||
2014 Omnibus Performance Award Plan | Employee Stock Option | Share Based Compensation Aware, Tranche Four | Scenario, Forecast | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 20.00% | 20.00% | 20.00% | 20.00% | ||||||||||||
2014 Omnibus Performance Award Plan | Employee Stock Option | Share Based Compensation Aware, Tranche Five | Scenario, Forecast | ||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 20.00% |
Stock Incentive Plans - Valuati
Stock Incentive Plans - Valuation Assumptions (Details) - Employee Stock Option | Dec. 03, 2021 | Jun. 11, 2021 | May 04, 2021 |
2014 Omnibus Performance Award Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 53.76% | ||
Dividend yield | 0.00% | ||
Expected term (in years) | 6 years | ||
Risk-free rate | 1.05% | ||
The 2013 Stock Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 64.26% | 57.77% | |
Dividend yield | 0.00% | 0.00% | |
Expected term (in years) | 6 years | 5 years | |
Risk-free rate | 1.21% | 0.96% |
Stock Incentive Plans - Schedul
Stock Incentive Plans - Schedule of stock options and stock awards (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Shares | ||
Outstanding at beginning of period (in shares) | 726,500 | |
Outstanding at end of period (in shares) | 846,731 | 726,500 |
Aggregate Intrinsic Value | ||
Share price (in dollars per share) | $ 1.96 | $ 5.50 |
The 2013 Plan and The 2014 Plan | ||
Number of Shares | ||
Outstanding at beginning of period (in shares) | 726,500 | |
Granted (in shares) | 262,475 | |
Exercised (in shares) | 0 | |
Forfeited or expired (in shares) | 142,244 | |
Outstanding at end of period (in shares) | 846,731 | 726,500 |
Vested and exercisable (in shares) | 384,858 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period (in dollars per share) | $ 4.53 | |
Granted (in dollars per share) | 3.83 | |
Exercised (in dollars per share) | 0 | |
Forfeited or expired (in dollars per share) | 9.73 | |
Outstanding at end of period (in dollars per share) | 4 | $ 4.53 |
Vested and exercisable (in dollars per share) | $ 4.85 | |
Weighted Average Remaining Contractual Term (in years) | ||
Outstanding weighted average remaining contractual term | 7 years 7 months 6 days | 7 years 2 months 12 days |
Granted | 5 years | |
Exercised | 0 years | |
Forfeited or expired | 0 years | |
Vested and exercisable | 6 years 7 months 6 days | |
Aggregate Intrinsic Value | ||
Outstanding at beginning of period | $ 1,484 | |
Granted | 0 | |
Exercised | 0 | |
Forfeited or expired | 0 | |
Outstanding at end of period | 0 | $ 1,484 |
Vested and exercisable | $ 0 |
Income Taxes - Schedule of inco
Income Taxes - Schedule of income before income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
U.S. (loss) income | $ (6,809) | $ (11,274) |
Non-U.S. income | (1,006) | 1,780 |
Loss before income tax benefit | $ (7,815) | $ (9,494) |
Income Taxes - Schedule of comp
Income Taxes - Schedule of components of income tax expense (benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Current tax expense: | ||
Federal | $ (333) | $ (2,918) |
State | 51 | 42 |
Foreign | 916 | 631 |
Total | 634 | (2,245) |
Deferred tax expense: | ||
Federal | 0 | (1,236) |
State | 0 | (83) |
Foreign | (1,486) | (220) |
Total | (1,486) | (1,539) |
Total income tax expense | $ (852) | $ (3,784) |
Income Taxes - Schedule of defe
Income Taxes - Schedule of deferred taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets (liabilities): | ||
Allowance for doubtful accounts | $ 298 | $ 345 |
Inventories | 296 | 99 |
Accrued payroll and benefits | 418 | 513 |
Goodwill and intangible assets | 2,135 | 951 |
Excess interest expense | 1,090 | 447 |
Tax credits and NOLs | 3,226 | 1,427 |
Lease liabilities | 2,412 | 2,604 |
Other | 300 | 339 |
Deferred tax asset before valuation allowance | 10,175 | 6,725 |
Valuation allowance | (3,354) | (684) |
Deferred tax asset | 6,821 | 6,041 |
Property, plant, and equipment | (1,975) | (2,544) |
Lease assets | (2,348) | (2,495) |
Other | (119) | (109) |
Deferred tax liability | (4,442) | (5,148) |
Total deferred tax asset (liability) | $ 2,379 | $ 893 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | ||
Tax credit carryforward | $ 1,200,000 | |
Prior year income tax expense (benefit) | 0 | $ (600,000) |
Unrecognized tax benefits | 0 | 0 |
Income tax penalties and interest | 0 | $ 0 |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Loss carryforwards | 1,800,000 | |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Loss carryforwards | $ 200,000 |
Income Taxes - Schedule of in_2
Income Taxes - Schedule of income taxes based on federal tax rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) at US Statutory Tax Rate | $ (1,641) | $ (1,994) |
State income tax (benefit) expense, net of federal benefit | (167) | (31) |
Foreign tax rate differential | 1 | 155 |
U.S. Tax on non-U.S. income | 0 | (600) |
U.S. Tax on non-U.S. income | (561) | |
Goodwill impairment | 156 | 0 |
Research and Development credits | (150) | (269) |
Assets Basis Adjustment | (650) | 0 |
NOL carryback | 0 | (1,037) |
Valuation allowance | 2,670 | 63 |
PPP loan forgiveness | (1,396) | 0 |
Other | 325 | (110) |
Total income tax expense | $ (852) | $ (3,784) |
Leases - Narrative (Details)
Leases - Narrative (Details) | Dec. 31, 2021renewalOption |
Lessee, Lease, Description [Line Items] | |
Renewal options | 1 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Renewal term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Renewal term | 5 years |
Leases - Lease Asset and Liabil
Leases - Lease Asset and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Right-of-Use-Assets | ||
Operating leases | $ 9,776 | $ 10,415 |
Liabilities | ||
Current, other accrued liabilities | 1,812 | 2,309 |
Noncurrent, other liabilities | 8,648 | 8,911 |
Total lease liabilities | $ 10,460 | $ 11,220 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other accrued liabilities | Other accrued liabilities |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other long term liabilities | Other long term liabilities |
Operating Leases - Schedule of
Operating Leases - Schedule of Operating Lease Maturities (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Leases [Abstract] | |
2022 | $ 2,426 |
2023 | 1,756 |
2024 | 1,669 |
2025 | 1,660 |
2026 | 1,471 |
Thereafter | 4,225 |
Total lease payments | 13,207 |
Less: interest | 2,747 |
Present value of lease payments | $ 10,460 |
Leases - Remaining Lease Term (
Leases - Remaining Lease Term (Details) | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Weighted average remaining lease term (years) | 7 years | 7 years |
Weighted average discount rate | 6.52% | 6.39% |
Leases - Lease Costs Included i
Leases - Lease Costs Included in Statement of Cash Flow (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | ||
Operating cash outflows from operating leases | $ 2,981 | $ 3,335 |
Retirement Plans (Details)
Retirement Plans (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Employer contribution amount | $ 0.4 | $ 0.4 |
Defined contribution plan, initial contribution | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Employer matching contribution, percent | 100.00% | |
Employer matching contribution, percent of employees gross pay | 3.00% | |
Defined contribution plan, additional contribution | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Employer matching contribution, percent | 50.00% | |
Employer matching contribution, percent of employees gross pay | 2.00% |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 21, 2021 | Mar. 18, 2020 | Mar. 18, 2013 | Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2021 | Mar. 18, 2018 |
Related Party Transaction [Line Items] | ||||||||
Exercise price of warrants (in dollars per share) | $ 3.12 | $ 3.12 | $ 0 | |||||
Affiliated Entity | Management Agreement | ||||||||
Related Party Transaction [Line Items] | ||||||||
Annual management fees | $ 300 | |||||||
Expenses from management contract | $ 100 | $ 200 | ||||||
Management agreement, term | 5 years | |||||||
Management agreement, renewal term | 1 year | |||||||
Equity ownership percent to terminate agreement | 50.00% | |||||||
Taglich Brothers, Inc. | ||||||||
Related Party Transaction [Line Items] | ||||||||
Percentage of payment of selling commissions | 8.00% | |||||||
Payment of placement agent offering costs | $ 44 | |||||||
Number of warrants purchased (in shares) | 156,320 | |||||||
Warrants and rights outstanding | 5 years | |||||||
Exercise price of warrants (in dollars per share) | $ 3.12 | |||||||
Engauge Workforce Solutions LLC ("Engauge") | ||||||||
Related Party Transaction [Line Items] | ||||||||
Expenses from management contract | $ 800 | |||||||
Agreement term | 12 months | |||||||
Written notice term | 60 days |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | ||
Net (loss) | $ (6,963) | $ (5,710) |
Denominator: | ||
Weighted average shares outstanding, basic (in shares) | 10,320,000 | 9,779,000 |
Dilutive effect of stock-based awards (in shares) | 0 | 0 |
Weighted average shares outstanding, diluted (in shares) | 10,320,000 | 9,779,000 |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Basic loss per share (in dollars per share) | $ (0.67) | $ (0.58) |
Diluted loss per share (in dollars per share) | $ (0.67) | $ (0.58) |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings per Share (Details) - $ / shares | 1 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Number of options (in shares) | 846,731 | 726,500 | |
Exercise price of options lower limit (in usd per share) | $ 2.08 | $ 2.36 | |
Exercise price of options upper limit (in usd per share) | $ 12.58 | $ 12.58 | |
Warrants (in shares) | 156,320 | 0 | |
Exercise price of warrants (in dollars per share) | $ 3.12 | $ 0 | |
Warrants for Underwriters | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Exercise price of warrants (in dollars per share) | $ 3.12 | ||
Warrants to purchase (in shares) | 156,320 |