Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 27, 2016 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Sequential Brands Group, Inc. | |
Entity Central Index Key | 1,648,428 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | SQBG | |
Entity Common Stock, Shares Outstanding | 62,474,862 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash | $ 19,911 | $ 41,560 |
Restricted cash | 1,518 | 0 |
Accounts receivable, net | 44,205 | 42,026 |
Available-for-sale securities | 6,671 | 5,611 |
Prepaid expenses and other current assets | 5,722 | 5,276 |
Current assets held for disposition from discontinued operations of wholesale business | 83 | 113 |
Total current assets | 78,110 | 94,586 |
Property and equipment, net | 8,582 | 6,547 |
Intangible assets, net | 1,033,742 | 872,277 |
Goodwill | 305,126 | 314,288 |
Other assets | 1,743 | 2,139 |
Total assets | 1,427,303 | 1,289,837 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 17,957 | 23,722 |
Current portion of long-term debt | 26,225 | 19,000 |
Current portion of deferred revenue | 5,308 | 2,157 |
Total current liabilities | 49,490 | 44,879 |
Long-term debt, net of current portion | 622,946 | 523,065 |
Long-term deferred revenue, net of current portion | 14,821 | 0 |
Deferred tax liability | 195,779 | 184,881 |
Other long-term liabilities | 10,779 | 10,686 |
Long-term liabilities held for disposition from discontinued operations of wholesale business | 639 | 677 |
Long-Term Liabilities: | ||
Total liabilities | 894,454 | 764,188 |
Commitments and Contingencies | ||
Equity: | ||
Preferred stock Series A, $0.01 par value; 10,000,000 shares authorized; none issued and outstanding at September 30, 2016 and December 31, 2015 | 0 | 0 |
Common stock, $0.01 par value; 150,000,000 shares authorized; 62,546,508 and 60,991,127 shares issued at September 30, 2016 and December 31, 2015, respectively, and 62,474,862 and 60,480,474 shares outstanding at September 30, 2016 and December 31, 2015, respectively | 623 | 605 |
Additional paid-in capital | 501,803 | 496,179 |
Accumulated other comprehensive loss | (5,388) | (6,466) |
Accumulated deficit | (38,671) | (38,830) |
Treasury stock, at cost; 71,646 shares at September 30, 2016 and none at December 31, 2015 | (501) | 0 |
Total Sequential Brands Group, Inc. and Subsidiaries stockholders’ equity | 457,866 | 451,488 |
Noncontrolling interest | 74,983 | 74,161 |
Total equity | 532,849 | 525,649 |
Total liabilities and equity | $ 1,427,303 | $ 1,289,837 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Preferred stock Series A, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock Series A, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock Series A, shares issued | 0 | 0 |
Preferred stock Series A, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 62,546,508 | 60,991,127 |
Common stock, shares outstanding | 62,474,862 | 60,480,474 |
Treasury stock, shares | 71,646 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Net revenue | $ 41,952 | $ 22,981 | $ 110,114 | $ 56,833 |
Operating expenses | 20,180 | 9,960 | 63,077 | 30,561 |
Income from operations | 21,772 | 13,021 | 47,037 | 26,272 |
Other income | 150 | 0 | 243 | 700 |
Interest expense, net | 14,742 | 6,210 | 36,031 | 17,162 |
Income before income taxes | 7,180 | 6,811 | 11,249 | 9,810 |
Provision for income taxes | 3,858 | 2,460 | 5,276 | 3,348 |
Net income | 3,322 | 4,351 | 5,973 | 6,462 |
Net income attributable to noncontrolling interest | (2,022) | (1,623) | (5,814) | (3,617) |
Net income attributable to Sequential Brands Group, Inc. and Subsidiaries | $ 1,300 | $ 2,728 | $ 159 | $ 2,845 |
Earnings per share attributable to Sequential Brands Group, Inc. and Subsidiaries: | ||||
Basic (in dollars per share) | $ 0.02 | $ 0.07 | $ 0 | $ 0.07 |
Diluted (in dollars per share) | $ 0.02 | $ 0.06 | $ 0 | $ 0.07 |
Weighted-average common shares outstanding: | ||||
Basic (in shares) | 62,176,700 | 39,781,868 | 61,817,742 | 39,384,090 |
Diluted (in shares) | 63,066,757 | 42,106,056 | 62,918,590 | 41,639,135 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Net income | $ 3,322 | $ 4,351 | $ 5,973 | $ 6,462 |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on available-for-sale securities | 1,118 | (941) | 1,060 | (941) |
Unrealized gain (loss) on interest rate hedging transactions | 23 | 11 | 18 | (78) |
Other comprehensive income (loss) | 1,141 | (930) | 1,078 | (1,019) |
Comprehensive income | 4,463 | 3,421 | 7,051 | 5,443 |
Comprehensive income attributable to noncontrolling interest | (2,022) | (1,623) | (5,814) | (3,617) |
Comprehensive income attributable to Sequential Brands Group, Inc. and Subsidiaries | $ 2,441 | $ 1,798 | $ 1,237 | $ 1,826 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - 9 months ended Sep. 30, 2016 - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Treasury Stock | Total Sequential Brands Group, Inc. and Subsidiaries Stockholders' Equity | Noncontrolling Interest |
Balance at Dec. 31, 2015 | $ 525,649 | $ 0 | $ 605 | $ 496,179 | $ (6,466) | $ (38,830) | $ 0 | $ 451,488 | $ 74,161 |
Balance (in shares) at Dec. 31, 2015 | 0 | 60,480,474 | 0 | ||||||
Stock-based compensation | 5,642 | $ 0 | $ 4 | 5,638 | 0 | 0 | $ 0 | 5,642 | 0 |
Stock-based compensation (in shares) | 0 | 619,388 | 0 | ||||||
Issuance of Galaxy Brand Holdings, Inc. holdback shares | 0 | $ 0 | $ 14 | (14) | 0 | 0 | $ 0 | 0 | 0 |
Issuance of Galaxy Brand Holdings, Inc. holdback shares (in shares) | 0 | 1,375,000 | 0 | ||||||
Unrealized loss on interest rate hedging transactions | 18 | $ 0 | $ 0 | 0 | 18 | 0 | $ 0 | 18 | 0 |
Unrealized loss on available-for-sale securities | 1,060 | 0 | 0 | 0 | 1,060 | 0 | 0 | 1,060 | 0 |
Repurchase of common stock | (501) | $ 0 | $ 0 | 0 | 0 | 0 | $ (501) | (501) | 0 |
Repurchase of common stock (in shares) | 0 | 0 | (71,646) | ||||||
Noncontrolling interest distribution | (4,992) | $ 0 | $ 0 | 0 | 0 | 0 | $ 0 | 0 | (4,992) |
Net income attributable to noncontrolling interest | 5,814 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 5,814 |
Net income attributable to common stockholders | 159 | 0 | 0 | 0 | 0 | 159 | 0 | 159 | 0 |
Balance at Sep. 30, 2016 | $ 532,849 | $ 0 | $ 623 | $ 501,803 | $ (5,388) | $ (38,671) | $ (501) | $ 457,866 | $ 74,983 |
Balance (in shares) at Sep. 30, 2016 | 0 | 62,474,862 | (71,646) |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Cash Flows From Operating Activities | ||
Net income | $ 5,973 | $ 6,462 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for bad debts | 475 | 126 |
Depreciation and amortization | 3,379 | 1,255 |
Stock-based compensation | 5,642 | 5,647 |
Amortization of deferred financing costs | 2,117 | 3,169 |
Gain on sale of trademark | 0 | (700) |
Loss on disposal of fixed assets | 491 | 0 |
Deferred income taxes | 5,003 | 2,712 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,654) | (6,155) |
Prepaid expenses and other assets | 776 | 2,528 |
Accounts payable and accrued expenses | (7,607) | (533) |
Deferred revenue | 17,972 | 76 |
Other liabilities | (162) | 37 |
Cash Provided By Operating Activities From Continuing Operations | 31,405 | 14,624 |
Cash Used In Operating Activities From Discontinued Operations | (8) | (211) |
Cash Provided By Operating Activities | 31,397 | 14,413 |
Cash Flows From Investing Activities | ||
Cash paid for acquisitions, net of cash acquired | (147,587) | (190,417) |
Acquisition of intangible assets | (390) | (350) |
Acquisition of property and equipment | (1,617) | (878) |
Proceeds from sale of property and equipment | 45 | 0 |
Acquisition of available-for-sale securities | 0 | (12,048) |
Changes in restricted cash | (1,518) | 0 |
Proceeds from sale of trademark | 0 | 140 |
Cash Used In Investing Activities | (151,067) | (203,553) |
Cash Flows From Financing Activities | ||
Proceeds from long-term debt | 132,000 | 205,679 |
Proceeds from issuance of common stock | 0 | 10,000 |
Proceeds from options exercised | 0 | 710 |
Proceeds from warrants exercised | 0 | 223 |
Stock registration costs | 0 | (1,330) |
Repayment of long-term debt | (14,000) | (11,679) |
Guaranteed payments in connection with acquisitions | (1,475) | (1,300) |
Deferred financing costs | (13,011) | (4,927) |
Repurchase of common stock | (501) | (837) |
Noncontrolling interest distribution | (4,992) | (1,633) |
Cash Provided By Financing Activities | 98,021 | 194,906 |
Net (Decrease) Increase In Cash | (21,649) | 5,766 |
Cash Beginning of period | 41,560 | 22,521 |
Cash End of period | 19,911 | 28,287 |
Supplemental Disclosures Of Cash Flow Information | ||
Interest | 31,792 | 13,584 |
Taxes | 178 | 994 |
Non-cash Investing And Financing Activities | ||
Accrued purchases of property and equipment | 1,602 | 0 |
Common stock issued in connection with acquisition | 0 | 1,295 |
Noncontrolling interest recorded in connection with acquisition | 0 | 65,094 |
Receivable for sale of trademark | 0 | 560 |
Guaranteed contractual payments recorded on acquisition | 0 | 3,648 |
Debt discount recorded on sale of common stock to debtholders | $ 0 | $ 1,496 |
Organization and Nature of Oper
Organization and Nature of Operations | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | 1. Organization and Nature of Operations Overview Sequential Brands Group, Inc. (the “Company”) owns a portfolio of consumer brands in the fashion, active and home categories. The Company aims to maximize the strategic value of its brands by promoting, marketing and licensing its global brands through various distribution channels, including to retailers, wholesalers and distributors in the United States and in certain international territories. The Company’s core strategy is to enhance and monetize the global reach of its existing brands, and to pursue additional strategic acquisitions to grow the scope of and diversify its portfolio of brands. The Company licenses brands to both wholesale and direct-to-retail licensees. In a wholesale and distributor license, a wholesale supplier is granted rights (typically on an exclusive basis) to a single or small group of related product categories for a particular brand for sale to multiple accounts within an approved channel of distribution and territory. In a direct-to-retail license, a single retailer is granted the right (typically on an exclusive basis) to sell branded products in a broad range of product categories through its brick and mortar stores and e-commerce sites. As of September 30, 2016, the Company had more than one-hundred fifty licensees, with wholesale licensees comprising a significant majority. The Company was formed on June 5, 2015, for the purpose of effecting the merger of Singer Merger Sub, Inc. with and into SQBG, Inc. (formerly known as Sequential Brands Group, Inc.) (“Old Sequential”) and the merger of Madeline Merger Sub, Inc. with and into Martha Stewart Living Omnimedia, Inc. (“MSLO”), with Old Sequential and MSLO each surviving the merger as wholly-owned subsidiaries of the Company (the “Mergers”). Prior to the Mergers, the Company did not conduct any activities other than those incidental to its formation and the matters contemplated in the Agreement and Plan of Merger, dated as of June 22, 2015, as amended, by and among the Company, MSLO, Old Sequential, Singer Merger Sub, Inc., and Madeline Merger Sub, Inc. (the “Merger Agreement”). On December 4, 2015, pursuant to the Merger Agreement, Old Sequential and MSLO completed the strategic combination of their respective businesses and became wholly-owned subsidiaries of the Company. Old Sequential was the accounting acquirer in the Mergers; therefore, the historical consolidated financial statements for Old Sequential for periods prior to the Mergers are considered to be the historical financial statements of the Company and thus, the Company’s consolidated financial statements reflect Old Sequential’s consolidated financial statements for the period from January 1, 2015 through December 4, 2015, and the Company’s consolidated financial statements thereafter. References to “the Company” when referring to periods prior to the consummation of the Mergers on December 4, 2015 are references to Old Sequential. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the United States Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all of the information and footnotes necessary for a comprehensive presentation of financial position, results of operations or cash flows. It is the Company’s opinion that the accompanying unaudited condensed consolidated financial statements include all adjustments, which are of a normal recurring nature necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the SEC on March 14, 2016, which contains the audited consolidated financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, for the years ended December 31, 2015, 2014 and 2013. The financial information as of December 31, 2015 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. The interim results for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016 or for any future interim periods. On January 1, 2016, the Company adopted Accounting Standards Update (“ASU”) No. 2015-03 “Interest Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”), which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs on the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The standard’s core principle is that debt issuance costs related to a note are reflected in the balance sheet as a direct deduction from the face amount of that note and amortization of debt issuance costs is reported in interest expense. As a result of the adoption of ASU 2015-03, the Company has reclassified certain balance sheet accounts for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. The Company reclassified approximately $ 7.9 Additionally, the Company has corrected an immaterial error in its condensed consolidated statement of cash flows for the nine months ended September 30, 2015. This correction is related to the payment of certain guaranteed obligations in connection with previous acquisitions and reflects an increase in cash provided by operating activities of approximately $ 1.3 1.3 The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. The preparation of unaudited condensed consolidated financial statements in conformity with 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 unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited condensed consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results could differ significantly from estimates. The Company has accounted for the closure of its wholesale operations during 2013 as discontinued operations in accordance with the guidance provided in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360, Accounting for Impairment or Disposal of Long-Lived Assets Presentation of Financial Statements The Company has entered into various license agreements that provide revenues based on guaranteed minimum royalty payments and advertising/marketing fees with additional royalty revenues based on a percentage of defined sales. Guaranteed minimum royalty payments and advertising/marketing revenue are recognized on a straight-line basis over the term of each contract year, as defined in each license agreement. Royalty payments exceeding the guaranteed minimum royalty payments are recognized as income during the period corresponding to the licensee’s sales. Payments received as consideration for the grant of a license are recorded as deferred revenue at the time payment is received and recognized ratably as revenue over the term of the license agreement. Advanced royalty payments are recorded as deferred revenue at the time payment is received and recognized as revenue as earned. Revenue is not recognized unless collectability is reasonably assured. If license agreements are terminated prior to the original licensing period, the Company recognizes revenue in the amount of any contractual termination fees, unless such amounts are deemed non-recoverable. With respect to editorial content for books, the Company receives advance payments from the Company’s publishers and recognizes revenue when manuscripts are delivered to and accepted by the publishers. Revenue is also earned from book publishing when sales on a unit basis exceed the advanced royalty. Television sponsorship revenues are generally recorded ratably across the period when new episodes initially air. Restricted cash at September 30, 2016 consists of cash deposited with a financial institution required as collateral for the Company’s cash-collateralized letter of credit facilities. Accounts receivable are recorded net of allowances for doubtful accounts, based on the Company’s ongoing discussions with its licensees and other customers and its evaluation of their creditworthiness, payment history and account aging. Accounts receivable balances deemed to be uncollectible are charged to the allowance for doubtful accounts after all means of collection have been exhausted and the potential for recovery is considered remote. The allowance for doubtful accounts was approximately $ 0.4 0.3 The Company’s accounts receivable amounted to approximately $ 44.2 42.0 25 14 11 26 15 11 The Company has marketable securities that are classified as available-for-sale securities under ASC 320, Investments Debt and Equity Securities September 30, 2016 Gross Unrealized Historical Cost Estimated Fair Value Gains Losses (in thousands) Available-for-sale securities $ 12,048 $ 6,671 $ - $ 5,377 December 31, 2015 Gross Unrealized Historical Cost Estimated Fair Value Gains Losses (in thousands) Available-for-sale securities $ 12,048 $ 5,611 $ - $ 6,437 As of both September 30, 2016 and December 31, 2015, the Company has concluded that the decline in fair value of its available-for-sale securities is not other-than-temporary. The available-for-sale securities have been in a loss position for twelve months. Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. In evaluating goodwill for impairment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Qualitative factors considered include, for example, macroeconomic and industry conditions, overall financial performance and other relevant entity-specific events. If the Company bypasses the qualitative assessment, or concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, it then performs a two-step goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment to be recognized, if any. In the first step, the Company will compare the estimated fair value of the reporting unit with its carrying value. The Company has determined it has a single reporting unit, and considers its market capitalization (calculated as total common shares outstanding multiplied by the common equity price per share, as adjusted for a control premium factor) to represent its estimated fair value. If the estimated fair value of the reporting unit exceeds its carrying amount, no further analysis is needed. If, however, the estimated fair value of the reporting unit is less than its carrying amount, the Company will proceed to the second step and calculate the implied fair value of the reporting unit goodwill to determine whether any impairment is required. The implied fair value of the reporting unit goodwill is calculated by allocating the estimated fair value of the reporting unit to all of the unit’s assets and liabilities as if the unit had been acquired in a business combination. If the carrying value of the reporting unit’s goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in the amount of that excess. Intangible assets represent trademarks, customer agreements and patents related to the Company’s brands and a favorable lease. Finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. Indefinite-lived intangible assets are not amortized, but instead are subject to impairment evaluation. The carrying value of intangible assets and other finite-lived assets is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are tested for impairment on an annual basis and between annual tests if an event occurs or circumstances change that indicate that the carrying amount of the indefinite-lived intangible asset may not be recoverable. When conducting its impairment assessment, the Company initially performs a qualitative evaluation of whether it is more likely than not that the asset is impaired. If it is determined by a qualitative evaluation that it is more likely than not that the asset is impaired, the Company then tests the asset for recoverability. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to its expected future undiscounted net cash flows. If the carrying amount of such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the recoverability of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. During the nine months ended September 30, 2016, the Company changed its annual impairment testing date from December 31 to October 1. The Company believes this new date is preferable because it allows for more timely completion of the annual impairment test prior to the end of its annual financial reporting period. The Company has concluded that this change in accounting principle is not material to its financial statements, in part because the change does not delay, accelerate or avoid an impairment charge. The Company has determined that it will be impracticable to objectively determine projected cash flow and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. As such, the Company will apply the change in annual impairment testing date prospectively beginning October 1, 2016. Treasury stock is recorded at cost as a reduction of equity in the accompanying condensed consolidated balance sheets. Compensation cost for restricted stock is measured using the quoted market price of the Company’s common stock at the date the common stock is granted. For restricted stock, for which restrictions lapse with the passage of time (“time-based restricted stock”), compensation cost is recognized on a straight-line basis, reduced for estimated forfeitures, over the period between the issue date and the date that restrictions lapse. Time-based restricted stock is included in total shares of common stock outstanding upon the lapse of applicable restrictions. For restricted stock, for which restrictions are based on performance measures (“performance stock units” or “PSUs”), restrictions lapse when those performance measures have been deemed achieved. Compensation cost for PSUs is recognized on a straight-line basis, reduced for estimated forfeitures, during the period from the date on which the likelihood of the PSUs being earned is deemed probable and (x) the end of the fiscal year during which such PSUs are granted or (y) the date on which awards of such PSUs may be approved by the compensation committee of the Company’s board of directors (the “Compensation Committee”) on a discretionary basis, as applicable. PSUs are included in total shares of common stock outstanding upon the lapse of applicable restrictions. PSUs are included in total diluted shares of common stock outstanding when the performance measures have been deemed achieved but the PSUs have not yet been issued. Compensation cost for stock options and warrants, in accordance with accounting for stock-based payment under GAAP, is calculated using the Black-Scholes valuation model based on awards ultimately expected to vest, reduced for estimated forfeitures, and expensed on a straight-line basis over the requisite service period of the grant. Forfeitures are estimated at the time of grant based on the Company’s historical forfeiture experience and are revised in subsequent periods if actual forfeitures differ from those estimates. At each subsequent reporting period prior to the lapse of restrictions on warrants, time-based restricted stock and PSUs granted to non-employees, the Company remeasures the aggregate compensation cost of such grants using the Company’s stock price at the end of such reporting period and revises the straight-line recognition of compensation cost in-line with such remeasured amount. Current income taxes are based on the respective periods’ taxable income for federal, foreign and state income tax reporting purposes. Deferred tax liabilities and assets are determined based on the difference between the financial statement and income tax bases of assets and liabilities, using statutory tax rates in effect for the year in which the differences are expected to reverse. In accordance with ASU No. 2015-17 “Balance Sheet Classification of Deferred Taxes”, all deferred income taxes are reported and classified as non-current. A valuation allowance is required if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company applies the FASB guidance on accounting for uncertainty in income taxes. The guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with other authoritative GAAP and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The guidance also addresses derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. At September 30, 2016 and December 31, 2015, the Company had $ 0.6 Earnings Per Share Basic earnings per share (“EPS”) is computed by dividing net income attributable to Sequential Brands Group, Inc. and Subsidiaries by the weighted-average number of common shares outstanding during the reporting period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all potentially dilutive common shares outstanding during the reporting period, including stock options, PSUs and warrants, using the treasury stock method, and convertible debt, using the if-converted method. Diluted EPS excludes all potentially dilutive shares of common stock if their effect is anti-dilutive. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Basic weighted-average common shares outstanding 62,176,700 39,781,868 61,817,742 39,384,090 Acquisition hold back shares - 1,375,000 230,840 1,375,000 Warrants 360,440 565,239 351,386 528,837 Stock options 18,252 37,798 15,406 108,587 Performance stock awards 407,355 139,889 408,152 47,142 Unvested restricted stock 104,010 206,262 95,064 195,479 Diluted weighted-average common shares outstanding 63,066,757 42,106,056 62,918,590 41,639,135 Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Warrants 325,000 - 325,000 - Unvested restricted stock - - 130,000 - Stock options 51,000 20,000 51,000 30,000 Total 376,000 20,000 506,000 30,000 Financial instruments which potentially expose the Company to credit risk consist primarily of cash, restricted cash, accounts receivable and marketable securities. Cash is held to meet working capital needs and future acquisitions. Restricted cash is cash pledged as collateral for a comparable amount of irrevocable standby letters of credit for certain of the Company’s leased properties. Substantially all of the Company’s cash, restricted cash and marketable securities are deposited with high quality financial institutions. At times, however, such cash, restricted cash and marketable securities may be in deposit accounts that exceed the Federal Deposit Insurance Corporation insurance limit. The Company has not experienced any losses in such accounts as of September 30, 2016. Concentration of credit risk with respect to accounts receivable is minimal due to the collection history and the nature of the Company’s revenues. The Company recorded net revenues of approximately $ 42.0 23.0 10 10 16 15 The Company recorded net revenues of approximately $ 110.1 56.8 10 10 10 19 16 The Company recognizes contingent losses that are both probable and estimable. In this context, probable means circumstances under which events are likely to occur. The Company records legal costs pertaining to contingencies as incurred. The Company recognizes the acquisition-date fair value of contingent consideration as part of the consideration transferred in exchange for the acquiree or assets of the acquiree in a business combination. The contingent consideration is classified as either a liability or equity in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity Noncontrolling interest from continuing operations recorded for the three and nine months ended September 30, 2016 represents income allocations to Elan Polo International, Inc., a member of DVS Footwear International, LLC (“DVS LLC”), With You, Inc., a member of With You LLC (the partnership between the Company and Jessica Simpson) and JALP, LLC (“JALP”), a member of FUL IP Holdings, LLC (“FUL IP”). Noncontrolling interest from continuing operations recorded for the three and nine months ended September 30, 2015 represents income allocations to DVS LLC and With You LLC. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) (in thousands) With You LLC $ 1,757 $ 1,470 $ 5,025 $ 3,163 DVS LLC 140 153 423 454 FUL IP 125 - 366 - Net income attributable to noncontrolling interest $ 2,022 $ 1,623 $ 5,814 $ 3,617 An operating segment, in part, is a component of an enterprise whose operating results are regularly reviewed by the chief operating decision maker (the “CODM”) to make decisions about resources to be allocated to the segment and assess its performance. Operating segments may be aggregated only to a limited extent. The Company’s CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis, accompanied by disaggregated information about revenues for purposes of making operating decisions and assessing financial performance. Accordingly, the Company has a single operating and reportable segment. In addition, the Company has no foreign operations or any material assets in foreign locations. Nearly all of the Company’s operations consist of a single revenue stream, which is the licensing of its trademark portfolio, with an immaterial portion of revenues derived from television, book, café operations and certain commissions |
Fair Value Measurement of Finan
Fair Value Measurement of Financial Instruments | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Financial Instruments | 3. Fair Value Measurement of Financial Instruments ASC 820-10, Fair Value Measurements and Disclosures The Company determines or calculates the fair value of financial instruments using quoted market prices in active markets when such information is available or using appropriate present value or other valuation techniques, such as discounted cash flow analyses, incorporating available market discount rate information for similar types of instruments while estimating for non-performance and liquidity risk. These techniques are significantly affected by the assumptions used, including the discount rate, credit spreads and estimates of future cash flow. Assets and liabilities typically recorded at fair value on a non-recurring basis to which ASC 820-10 applies include: • non-financial assets and liabilities initially measured at fair value in an acquisition or business combination, and • long-lived assets measured at fair value due to an impairment assessment under ASC 360-10-15, Impairment or Disposal of Long-Lived Assets This topic defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820-10 requires that assets and liabilities recorded at fair value be classified and disclosed in one of the following three categories: • Level 1 - inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. • Level 2 - inputs utilize other-than-quoted prices that are observable, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs such as interest rates and yield curves that are observable at commonly quoted intervals. • Level 3 - inputs are unobservable and are typically based on the Company’s own assumptions, including situations where there is little, if any, market activity. Both observable and unobservable inputs may be used to determine the fair value of positions that are classified within the Level 3 classification. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the Company classifies such financial assets or liabilities based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. As of both September 30, 2016 and December 31, 2015, there were no assets or liabilities that are required to be measured at fair value on a recurring basis, except for the Company’s available-for-sale securities (see Note 2), interest rate swap (see Note 7), the contingent earn outs relating to the Linens ‘N Things Carrying Value Fair Value Financial Instrument Level 9/30/2016 12/31/2015 9/30/2016 12/31/2015 (in thousands) Available-for-sale securities 1 $ 6,671 $ 5,611 $ 6,671 $ 5,611 Interest rate swap 2 $ 11 $ 29 $ 11 $ 29 2016 Term Loans 3 $ 587,500 $ - $ 554,132 $ - 2016 Revolving Loan 3 $ 80,500 $ - $ 59,812 $ - 2015 Term Loans 3 $ - $ 464,000 $ - $ 446,320 2015 Revolving Loan 3 $ - $ 86,000 $ - $ 62,880 LNT Contingent Earn Out 3 $ - $ - $ - $ - Legacy Payments 3 $ 1,936 $ - $ 1,936 $ - The carrying amounts of the Company’s cash, restricted cash, accounts receivable and accounts payable approximate fair value due to their short-term maturities. The Company records its available-for-sale securities on the condensed consolidated balance sheets at fair value using Level 1 inputs. The fair value of the Company’s available-for-sale securities is based upon quoted market prices for identical assets in active markets. During 2015, the Company entered into an interest rate swap agreement related to term loans with a $ 19.0 The objective of the swap agreement is to reduce the variability in cash flows for interest payments associated with the loan agreements, which are based on the 1-month London Interbank Offered Rate (“LIBOR”) rates. The Company has formally documented the swap agreement as a cash flow hedge of the Company’s exposure to 1-month LIBOR. Because the critical terms of the swap agreement and the hedged items coincided at inception (e.g., notional amount, interest rate reset dates, interest rate payment dates, maturity/expiration date and underlying index), the hedge was expected to completely offset changes in expected cash flows due to fluctuations in the 1-month LIBOR rate over the term of the hedge. The effectiveness of the hedge relationship is periodically assessed during the life of the hedge by comparing the current terms of the swap agreement and the loan agreements to assure they continue to coincide and through an evaluation of the continued ability of the respective counterparties to honor their obligations under the 2015 Swap Agreement. When the key terms no longer match exactly, hedge effectiveness (both prospective and retrospective) is assessed by evaluating the cumulative dollar offset for the actual hedging instrument relative to a hypothetical derivative whose terms exactly match the terms of the hedged item. Because the notional amounts of the Company’s swap agreement no longer match the notional amounts of the loan agreements exactly, the Company assessed the ineffectiveness of the swap agreement and determined that differences were immaterial as of September 30, 2016 and December 31, 2015. Notional Value Derivative Asset Derivative Liability (in thousands) Term Loans $ 19,000 $ - $ 11 For purposes of this fair value disclosure, the Company based its fair value estimate for the 2016 Term Loans, 2016 Revolving Loan, 2015 Term Loans and 2015 Revolving Loan (each, as defined in Note 7) on its internal valuation whereby the Company applied the discounted cash flow method to its expected cash flow payments due under the loan agreements based on market interest rate quotes as of September 30, 2016 and December 31, 2015 for debt with similar risk characteristics and maturities. On the date of the acquisition, no value was assigned to the LNT Contingent Earn Out based on the remote probability that the Linens ‘N Things The Company determined the acquisition date fair value of Legacy Payments due to Ms. Martha Stewart was approximately $ 1.7 0.1 0.2 |
Discontinued Operations of Whol
Discontinued Operations of Wholesale Business | 9 Months Ended |
Sep. 30, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations of Wholesale Business | 4. Discontinued Operations of Wholesale Business The Company did not record any additional costs relating to discontinued operations of its former wholesale business during the three and nine months ended September 30, 2016 and 2015. A summary of the Company’s assets and liabilities from discontinued operations of its former wholesale business as of September 30, 2016 and December 31, 2015 is as follows: September 30, December 31, 2016 2015 (in thousands) Prepaid expenses and other current assets $ 83 $ 113 Long-term liabilities $ 639 $ 677 |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill, Impaired [Abstract] | |
Goodwill | 5. Goodwill September 30, 2016 (in thousands) Balance at January 1 $ 314,288 Acquisition of Martha Stewart Living Omnimedia, Inc. (see Note 11) (11,249) Acquisition of Gaiam, Inc. Branded Consumer Business (see Note 11) 2,087 Ending balance $ 305,126 Goodwill from the acquisitions of With You LLC, Joe’s Jeans, Martha Stewart Living Omnimedia, Inc. and Gaiam Inc. represents the excess of the purchase price over the fair value of net assets acquired under the acquisition method of accounting. Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. In evaluating goodwill for impairment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Qualitative factors considered include, for example, macroeconomic and industry conditions, overall financial performance and other relevant entity-specific events. If the Company bypasses the qualitative assessment, or concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, it then performs a two-step goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment to be recognized, if any. In the first step, the Company will compare the estimated fair value of the reporting unit with its carrying value. The Company has determined it has a single reporting unit, and considers its market capitalization (calculated as total common shares outstanding multiplied by the common equity price per share, as adjusted for a control premium factor) to represent its estimated fair value. If the estimated fair value of the reporting unit exceeds its carrying amount, no further analysis is needed. If, however, the estimated fair value of the reporting unit is less than its carrying amount, the Company will proceed to the second step and calculate the implied fair value of the reporting unit goodwill to determine whether any impairment is required. The implied fair value of the reporting unit goodwill is calculated by allocating the estimated fair value of the reporting unit to all of the unit’s assets and liabilities as if the unit had been acquired in a business combination. If the carrying value of the reporting unit’s goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in the amount of that excess. No events or circumstances indicate an impairment has been identified subsequent to the Company’s December 31, 2015 impairment testing. During the nine months ended September 30, 2016, the Company changed its annual impairment testing date from December 31 to October 1. The Company believes this new date is preferable because it allows for more timely completion of the annual impairment test prior to the end of its annual financial reporting period. This change in accounting principle does not delay, accelerate or avoid an impairment charge. The Company has determined that it will be impracticable to objectively determine projected cash flow and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. As such, the Company will apply the change in annual impairment testing date prospectively beginning October 1, 2016. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets | 6. Intangible Assets September 30, 2016 Useful Lives Gross Accumulated Net (in thousands) Finite-lived intangible assets: Trademarks 15 $ 4,971 $ (1,475) $ 3,496 Customer agreements 4 2,809 (1,559) 1,250 Favorable lease 2 537 (498) 39 Patents 10 665 (214) 451 $ 8,982 $ (3,746) 5,236 Indefinite-lived intangible assets: Trademarks 1,028,506 Intangible assets, net $ 1,033,742 December 31, 2015 Useful Lives Gross Accumulated Net (in thousands) Finite-lived intangible assets: Trademarks 15 $ 4,905 $ (1,228) $ 3,677 Customer agreements 4 2,817 (1,017) 1,800 Favorable lease 2 537 (322) 215 Patents 10 665 (164) 501 $ 8,924 $ (2,731) 6,193 Indefinite-lived intangible assets: Trademarks 866,084 Intangible assets, net $ 872,277 Years ending December 31, (in thousands) Remainder of 2016 $ 314 2017 907 2018 775 2019 587 2020 398 Thereafter 2,255 $ 5,236 Amortization expense amounted to approximately $ 0.3 1.0 0.8 Finite-lived intangible assets represent trademarks, customer agreements and patents related to the Company’s brands and a favorable lease. Finite-lived assets are amortized on a straight-line basis over the estimated useful lives of the assets. Indefinite-lived intangible assets are not amortized, but instead are subject to impairment evaluation. The carrying value of finite-lived intangible assets and other long-lived assets is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Historically, indefinite-lived intangible assets have been tested for impairment on an annual basis at December 31 and between annual tests if an event occurs or circumstances change that indicate that the carrying amount of the indefinite-lived intangible asset may not be recoverable. When conducting its impairment assessment, the Company initially performs a qualitative evaluation of whether it is more likely than not that the asset is impaired. If it is determined by a qualitative evaluation that it is more likely than not that the asset is impaired, the Company then tests the asset for recoverability. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to its expected future undiscounted net cash flows. If the carrying amount of such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the recoverability of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. No events or circumstances indicate an impairment has been identified subsequent to the Company’s December 31, 2015 impairment testing. During the nine months ended September 30, 2016, the Company changed its annual impairment testing date from December 31 to October 1. The Company believes this new date is preferable because it allows for more timely completion of the annual impairment test prior to the end of its annual financial reporting period. This change in accounting principle does not delay, accelerate or avoid an impairment charge. The Company has determined that it will be impracticable to objectively determine projected cash flow and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. As such, the Company will apply the change in annual impairment testing date prospectively beginning October 1, 2016. On February 24, 2015, the Company sold the People’s Liberation 0.7 1.0 People’s Liberation 30.0 0.7 People’s Liberation People’s Liberation 30.0 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2016 | |
Long-term Debt, by Current and Noncurrent [Abstract] | |
Long-Term Debt | 7. Long-Term Debt September 30, December 31, 2016 2015 (in thousands) Secured Term Loans $ 587,500 $ 464,000 Revolving Credit Facility 80,500 86,000 Unamortized deferred financing costs (18,829) (7,935) Total long-term debt, net of unamortized deferred financing costs 649,171 542,065 Less: current portion of long-term debt 26,225 19,000 Long-term debt $ 622,946 $ 523,065 July 2016 Debt Facilities On July 1, 2016 (the “Closing Date”), the Company and certain of its subsidiaries entered into (i) the Third Amended and Restated First Lien Credit Agreement (the “Amended BoA Credit Agreement”) with Bank of America, N.A., as administrative agent and collateral agent and the lenders party thereto and (ii) the Third Amended and Restated Credit Agreement (the “Amended GSO Credit Agreement”) with Wilmington Trust, National Association, as administrative agent and collateral agent (the “GSO Agent”) and the lenders party thereto. Such agreements amended, restated and replaced the debt facilities described below under “December 2015 Debt Facilities”, as described more fully below. The Company used a portion of the proceeds of the $ 287.5 415.0 The Amended BoA Credit Agreement provides for several five-year credit facilities, consisting of (i) Tranche A Term Loans in an aggregate principal amount of $ 133.0 44.5 110.0 258.0 133.0 44.5 80.5 The loans under the Amended BoA Credit Agreement bear interest, at the Company’s option, at a rate equal to (i) with respect to the Revolving Loans and the Tranche A Loans (a) the LIBOR rate plus 3.50% per annum or (b) the base rate plus 2.50% per annum (a) the LIBOR rate plus 7.00% per annum or (b) the base rate plus 6.00% per annum. 0.375 The Company may make voluntary prepayments of the loans outstanding under the Amended BoA Credit Agreement, subject to the payment of customary “breakage” costs with respect to LIBOR-based borrowings and, in certain cases, to the prepayment premium set forth in the Amended BoA Credit Agreement. Additionally, the Company is mandated to make prepayments (without payment of a premium or penalty) under the Amended BoA Credit Agreement amounting to: (i) the loans outstanding under the Amended BoA Credit Agreement plus, (a) where intellectual property is disposed, 50.0% of the disposed intellectual property’s orderly liquidation value, and (b) where any other assets constituting collateral are disposed or upon the receipt of certain insurance proceeds, 100% of the net proceeds thereof, subject to certain reinvestment rights; and (ii) the Tranche A-1 Loans to the extent that the outstanding principal amount thereof exceeds 10.0% of the orderly liquidation value of the registered trademarks owned by the BoA Facility Loan Parties. 5.0 The Amended BoA Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants applicable to the BoA Facility Loan Parties and their subsidiaries. Moreover, the Amended BoA Credit Agreement contains financial covenants that require the BoA Facility Loan Parties and their subsidiaries to (i) maintain a positive net income, (ii) satisfy a maximum loan to value ratio set at 50.0% (applicable to the Revolving Loans and Tranche A Loans) and (iii) satisfy a maximum consolidated first lien leverage ratio, initially set at 2.80:1.00, decreasing over the term of the Amended BoA Credit Agreement until reaching the final maximum ratio of 2.50:1.00 for the fiscal quarter ending September 30, 2018 and thereafter. The Amended BoA Credit Agreement contains certain customary events of default, including a change of control. If an event of default occurs and is not cured within any applicable grace period or not waived, the Bank of America Agent, at the request of the lenders under the Amended BoA Credit Agreement, must take various actions, including, without limitation, the acceleration of amounts due under the Amended BoA Credit Agreement. The Company may request an increase in (i) the Revolving Credit Facility and Tranche A Loans as would not cause the consolidated first lien leverage ratio, determined on a pro forma basis after giving effect to any such increase, to exceed 2.33:1.00 and (ii) the Tranche A-1 Loans, as would not cause the consolidated first lien leverage ratio, determined on a pro forma basis after giving effect to any such increase, to exceed (a) with respect to any increase, the proceeds of which will be used solely to finance an acquisition, 2.50:100 and (b) with respect to any other increase, 2.40:1.00, subject to the satisfaction of certain conditions in the Amended BoA Credit Agreement. At September 30, 2016, the Company is in compliance with the covenants included in the Amended BoA Credit Agreement. The Amended GSO Credit Agreement provides for a six-year $ 415.0 The Company may request one or more additional term loan facilities or the increase of term loan commitments under the Amended GSO Credit Agreement as would not cause the consolidated total leverage ratio, determined on a pro forma basis after giving effect to any such addition and increase, to exceed 6.00:1.00, subject to the satisfaction of certain conditions in the Amended GSO Credit Agreement. The loans under the Amended GSO Credit Agreement bear interest, at the Company’s option, at a rate equal to either (i) the LIBOR rate plus an applicable margin of 8.25% or 9.00% per annum or (ii) the base rate plus an applicable margin of 7.25% or 8.00% per annum, The Company may make voluntary prepayments of the loans outstanding under the Amended GSO Credit Agreement, subject to the payment of customary “breakage” costs with respect to LIBOR-based borrowings and, in certain cases, to the prepayment premium set forth in the Amended GSO Credit Agreement. The Company is mandated to make prepayments (without payment of a premium or penalty) of loans outstanding under the Amended GSO Credit Agreement amounting to: (i) where intellectual property is disposed, 50.0% of the disposed intellectual property’s orderly liquidation value, (ii) where any other asset constituting collateral is disposed or upon the receipt of certain insurance proceeds, 100% of the net proceeds thereof, subject to certain reinvestment rights, and (iii) any consolidated excess cash flow, in an amount equal to (a) in the event the consolidated total leverage ratio is at least 4.00:1.00, 75% thereof, (b) in the event the consolidated total leverage ratio is less than 4.00:1.00 but at least 3.00:1.00, 50% thereof and (c) in the event the consolidated total leverage ratio is less than 3.00:1.00, 0% thereof. Commencing on March 31, 2017, the Loans under the Amended GSO Credit Agreement will amortize in quarterly installments, equal to 2.00% per annum of the original aggregate principal amount thereof. The Amended GSO Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants applicable to the GSO Facility Loan Parties and their subsidiaries. Moreover, the Amended GSO Credit Agreement contains financial covenants that require the GSO Facility Loan Parties and their subsidiaries to satisfy (i) a maximum consolidated total leverage ratio, initially set at 7.25:1.00, decreasing over the term of the Amended GSO Credit Agreement until reaching the final maximum ratio of 6.50:1.00 for the fiscal quarter ending September 30, 2018 and thereafter and (ii) a maximum consolidated first lien leverage ratio, initially set at 2.80:1.00, decreasing over the term of the Amended GSO Credit Agreement until reaching the final maximum ratio of 2.50:1.00 for the fiscal quarter ending September 30, 2018 and thereafter. The Amended GSO Credit Agreement contains certain customary events of default, including a change of control. If an event of default occurs and is not cured within any applicable grace period or is not waived, the GSO Agent, at the request of the lenders under the Amended GSO Credit Agreement, is required to take various actions, including, without limitation, the acceleration of amounts due thereunder. The Company may request one or more additional term loan facilities or the increase of term loan commitments under the GSO Credit Agreement as would not cause the consolidated total leverage ratio, determined on a pro forma basis after giving effect to any such addition and increase, to exceed 6.00:1.00, subject to the satisfaction of certain conditions in the GSO Credit Agreement. During the three and nine months ended September 30, 2016, the Company incurred legal and other fees associated with debt financing in connection with the acquisition of Gaiam, Inc. of approximately $ 13.0 0.3 Debt December 2015 Debt Facilities On December 4, 2015, in conjunction with the acquisition of MSLO, the Company, Old Sequential and certain other subsidiaries of the Company entered into an amendment to the Second Amended and Restated First Lien Credit Agreement (the “Amendment”), dated as of April 8, 2015 (as amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the “BoA Credit Agreement”), by and among, Old Sequential, the guarantors party thereto, the lenders party thereto (the “BoA Lenders”) and Bank of America, N.A., as administrative agent and collateral agent (in such capacity, the “BoA Agent”). The Amendment had an effective date of December 4, 2015, and amended certain provisions under the BoA Credit Agreement to, among other things, (i) permit the consummation of the Mergers, (ii) permit, subject to the satisfaction of certain conditions, the increase in the aggregate revolving commitments and term loans under the BoA Credit Agreement by such amounts as would not cause the consolidated first lien leverage ratio, determined on a pro forma basis after giving effect to any such increase, to exceed 2.00:1.00, (iii) permit the inclusion of not less than (a) $30.0 million of EBITDA representing EBITDA generation by MSLO, (b) $8.0 million of EBITDA representing EBITDA generation by Joe’s Holdings and (c) fees and expenses incurred and associated with the Mergers and the acquisition of Joe’s Holdings in certain provisions that relate to calculation of the consolidated first lien leverage ratio, (iv) permit the incurrence of indebtedness under the GSO Term Loan Agreement (defined below) and (v) designated the Company as the “borrower” under the BoA Credit Agreement. On December 4, 2015, the Company, Old Sequential and the BoA Agent entered into a Joinder and Assumption Agreement (the “Joinder and Assumption Agreement”), pursuant to which Old Sequential was discharged from its obligations, liabilities and rights as the “borrower” under the BoA Credit Agreement and the Company assumed all such obligations, liabilities and rights and was designated as the “borrower” under the BoA Credit Agreement for all purposes thereunder. In addition, on December 4, 2015, the Company, Old Sequential and certain other subsidiaries of the Company entered into a new Second Amended and Restated Credit Agreement (the “GSO Term Loan Agreement”) with Wilmington Trust, National Association, as administrative agent and collateral agent (in such capacity, the “GSO Term Loan Agent”), and the lenders party to the existing Amended and Restated Second Lien Credit Agreement, dated as of April 8, 2015 (as amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the “Existing Second Lien Credit Agreement”), by and among, Old Sequential, the guarantors party thereto, the lenders party thereto and Wilmington Trust, National Association, as administrative agent and collateral agent (in such capacity, the “Second Lien Agent”). The GSO Term Loan Agreement provided for a six-year $ 368.0 215.5 152.5 The GSO Term Loan Agreement, together with the Term Loan A and Term Loan A-1 tranches of the BoA Credit Agreement represented the 2015 Term Loans. The revolving credit line of the BoA Credit Agreement represented the 2015 Revolving Loan. The Company used the proceeds of the new loans to fund the payment of the purchase price, costs and expenses incurred in connection with the Mergers and related transactions. The Company had the option to request the addition of one or more additional term loan facilities or the increase of term loan commitments under the Facility by such amounts as would not cause the consolidated total leverage ratio, determined on a pro forma basis after giving effect to any such addition and increase, to exceed 6.00:1.00, which additions and increase are subject to the satisfaction of certain conditions set forth in the GSO Term Loan Agreement. The loans under the Facility bore interest, at the Company’s option, at a rate equal to either (i) LIBOR rate plus an applicable margin ranging from 8.00% to 8.75% per annum or (ii) the base rate plus an applicable margin ranging from 7.00% to 7.75% per annum Applicable Margin LIBOR Consolidated Total Leverage Ratio Consolidated Net Leverage Ratio Loans > 6.00 : 1.00 ≥ 5.75 : 1.00 8.75 % ≥ 4.75 : 1.00 ≤ 6.00 : 1.00 ≥ 4.50 : 1.00 < 5.75 : 1.00 8.25 % < 4.75 : 1.00 < 4.50 : 1.00 8.00 % The Company’s obligations under the GSO Term Loan Agreement and any hedging or cash management obligations entered into by the Company or any of its current and future domestic restricted subsidiaries (the “Subsidiary Guarantors” and, together with the Company, the “Loan Parties”) with a lender under the GSO Term Loan Agreement, the New Agreement Agent or an affiliate of any such person were guaranteed by the Company and each Subsidiary Guarantor. The Company’s and the Subsidiary Guarantors’ obligations under the GSO Term Loan Agreement were secured by substantially all of their assets, subject to certain customary exceptions. The Company was required to make mandatory prepayments of loans outstanding under the Facility (without payment of a premium or penalty) (i) in the case of any disposition of intellectual property, the then applicable LTV Percentage (as defined in the BoA Credit Agreement) of the orderly liquidation value thereof, (ii) in the case of any other disposition of any other assets, 100% of the net proceeds thereof, subject to certain reinvestment rights, and (iii) in the case of any Consolidated Excess Cash Flow (as defined in the GSO Term Loan Agreement), 50% thereof, which shall decrease to 0% if the consolidated total leverage ratio is less than 3.00:1.00. The loans under the Facility were not subject to amortization. The Company could have made, in whole or in part, voluntarily prepayments of the loans outstanding under the Facility. Such voluntarily prepayments were subject to the payment of customary “breakage” costs with respect to LIBOR-based borrowings and in certain cases to the prepayment premium set forth in the GSO Term Loan Agreement. The GSO Term Loan Agreement contained customary representations and warranties and customary affirmative and negative covenants applicable to the Loan Parties and their subsidiaries, including, without limitation, restrictions on liens, investments, indebtedness, fundamental changes, dispositions, restricted payments and prepayment of indebtedness. The GSO Term Loan Agreement contained financial covenants that required the Loan Parties and their subsidiaries to (i) not exceed a maximum consolidated total leverage ratio initially set at 7.25:1.00, which decreases periodically over the term of the GSO Term Loan Agreement until the final maximum ratio of 6.75:1.00 is reached for the fiscal quarter ending September 30, 2019 and thereafter and (ii) not exceed a maximum consolidated first lien leverage ratio initially set at 2.47:1.00, which decreases periodically over the term of the GSO Term Loan Agreement until the final maximum ratio of 2.30:1.00 is reached for the fiscal quarter ending September 30, 2019 and thereafter. The GSO Term Loan Agreement contained customary events of default, including, without limitation, payment defaults, covenant defaults, breaches of certain representations and warranties, cross defaults to certain material indebtedness, certain events of bankruptcy and insolvency, certain events under the Employee Retirement Income Security Act of 1974, material judgments and a change of control. If an event of default occurred and was not cured within any applicable grace period or was not waived, the New Agreement Agent, at the request of the lenders under the GSO Term Loan Agreement, was required to take various actions, including, without limitation, the acceleration of amounts due thereunder. The Company was in compliance with the covenants throughout the existence of the GSO Term Loan Agreement. In connection with the BoA Credit Agreement and the GSO Term Loan Agreement, the BoA Agent and the New Agreement Agent had entered into an Intercreditor Agreement, dated as of December 4, 2015 (the “Intercreditor Agreement”), which was acknowledged by the Company and the guarantors party thereto. The Intercreditor Agreement established various inter-lender terms, including, without limitation, priority of liens, permitted actions by each party, application of proceeds, exercise of remedies in the case of a default, incurrence of additional indebtedness, releases of collateral and limitations on the amendment of the BoA Credit Agreement and the GSO Loan Agreement without the consent of the other party. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. Commitments and Contingencies MSLO Stockholder Complaint In connection with the Mergers, the following 13 putative stockholder class action lawsuits have been filed in the Court of Chancery of the State of Delaware: (1) David Shaev Profit Sharing Plan f/b/o David Shaev v. Martha Stewart Living Omnimedia Inc. et. al. Malka Raul v. Martha Stewart Living Omnimedia Inc. et. al. Daniel Lisman v. Martha Stewart Living Omnimedia Inc. et. al. Matthew Sciabacucchi v. Martha Stewart Living Omnimedia Inc. et. al. Harold Litwin v. Martha Stewart Living Omnimedia Inc. et. al. Richard Schiffrin v. Martha Stewart Cedric Terrell v. Martha Stewart Living Omnimedia Inc. et. al. Dorothy Moore v. Martha Stewart Living Omnimedia Inc. et. al. Paul Dranove v. Pierre De Villemejane. et. al. Phuc Nguyen v. Martha Stewart Living Omnimedia Inc. et. al. Kenneth Steiner v. Martha Stewart Living Omnimedia Inc. et. al. Karen Gordon v. Martha Stewart et. al. Anne Seader v. Martha Stewart Living Omnimedia, Inc. et. al. General Legal Matters From time to time, the Company is involved in legal matters arising in the ordinary course of business. While the Company believes that such matters are currently not material, there can be no assurance that matters arising in the ordinary course of business for which the Company is, or could be, involved in litigation, will not have a material adverse effect on its business, financial condition or results of operations. Contingent liabilities arising from potential litigation are assessed by management based on the individual analysis of these proceedings and on the opinion of the Company’s lawyers and legal consultants. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Compensation | 9. Stock-based Compensation Stock Options Weighted- Average Weighted- Remaining Number of Average Exercise Contractual Life Aggregate Options Price (in Years) Intrinsic Value (in thousands, except share and per share data) Outstanding - January 1, 2016 129,501 $ 9.65 3.3 $ 148 Granted - - Exercised - - Forfeited or Canceled - - Outstanding - September 30, 2016 129,501 $ 9.65 2.7 $ 153 Exercisable - September 30, 2016 124,501 $ 9.77 2.7 $ 147 A summary of the changes in the Company’s unvested stock options is as follows: Weighted- Number of Average Grant Options Date Fair Value Unvested - January 1, 2016 21,000 $ 2.71 Granted - - Vested (16,000) (2.94) Forfeited or Canceled - - Unvested - September 30, 2016 5,000 $ 1.96 The Company did not grant any stock options during the three and nine months ended September 30, 2016. During the nine months ended September 30, 2015, the Company granted an aggregate of 10,000 0.1 Risk-free interest rate 0.90 % Expected dividend yield 0.00 % Expected volatility 32.10 % Expected life 3.00 years The Company recorded less than $ 0.1 Total compensation expense related to stock options for each of the three and nine months ended September 30, 2016 and 2015 was less than $ 0.1 0.1 0.4 Warrants Weighted- Average Weighted- Remaining Number of Average Exercise Contractual Life Aggregate Warrants Price (in Years) Intrinsic Value (in thousands, except share and per share data) Outstanding - January 1, 2016 801,760 $ 7.87 4.1 $ 1,377 Granted - - Exercised - - Forfeited or Canceled - - Outstanding - September 30, 2016 801,760 $ 7.87 3.3 $ 1,420 Exercisable - September 30, 2016 726,760 $ 7.31 2.8 $ 1,420 A summary of the changes in the Company’s unvested warrants is as follows: Weighted- Number of Average Grant Warrants Date Fair Value Unvested - January 1, 2016 150,000 $ 6.32 Granted - - Vested (75,000) 6.32 Forfeited or Canceled - - Unvested - September 30, 2016 75,000 $ 6.32 The Company did not issue any warrants during the three and nine months ended September 30, 2016. During the nine months ended September 30, 2015, the Company issued ten-year warrants to purchase up to an aggregate of 200,000 13.32 1.3 Risk-free interest rate 2.16 % Expected dividend yield 0.00 % Expected volatility 45.84 % Expected life 7.25 years The Company recorded approximately $ 0.1 0.2 0.2 0.3 Total compensation expense related to warrants for the three months ended September 30, 2016 and 2015 was approximately $ 0.1 0.2 0.2 0.3 Restricted Stock and Restricted Stock Units Weighted- Average Weighted- Remaining Number of Average Grant Contractual Life Aggregate Shares Date Fair Value (in Years) Intrinsic Value (in thousands, except share and per share data) Unvested - January 1, 2016 510,653 $ 9.89 2.0 $ 510 Granted 280,548 6.58 Vested (187,985) 7.29 Unvested - September 30, 2016 603,216 $ 9.16 1.9 $ 589 During the three and nine months ended September 30, 2016, the Company granted 175,000 1.2 0.1 During the three and nine months ended September 30, 2016, the Company accelerated the vesting of 32,500 0.2 During the nine months ended September 30, 2016, the Company granted (i) 35,000 70,548 0.7 0.1 0.2 During the nine months ended September 30, 2015, the Company granted (i) 100,000 15,000 24,452 150,150 3.8 0.2 0.4 0.7 0.6 Total compensation expense related to time-based restricted stock and time-based restricted stock unit grants for the three months ended September 30, 2016 and 2015 was approximately $ 0.8 0.9 1.8 2.2 Performance Stock Units Weighted- Average Weighted- Remaining Number of Average Grant Contractual Life Aggregate Shares Date Fair Value (in Years) Intrinsic Value (in thousands, except share and per share data) Unvested - January 1, 2016 1,308,500 $ 10.98 1.4 $ 96 Granted 30,000 7.23 Vested (317,833) (9.58) Forfeited or Cancelled (39,300) (5.74) Unvested - September 30, 2016 981,367 $ 11.53 0.7 $ 23 During the three and nine months ended September 30, 2016, the Company accelerated the vesting of 108,500 0.5 During the nine months ended September 30, 2016, the Company granted 30,000 0.2 0.1 On February 23, 2016, the Compensation Committee voted to approve, on a discretionary basis, an award of 69,994 20,000 12,000 0.4 During the nine months ended September 30, 2015, the Company granted 200,000 2.9 On February 24, 2015, the Compensation Committee voted to approve, on a discretionary basis, an award of 198,000 60,000 36,000 2.0 In addition, during the nine months ended September 30, 2015, the Compensation Committee approved, on a discretionary basis, an award of 12,500 0.1 Total compensation expense related to the PSUs for the three months ended September 30, 2016 and 2015 was approximately $ 1.3 0.5 3.6 3.1 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 10. Related Party Transactions Consulting Services Agreement with Tengram Capital Partners, L.P. (f/k/a Tengram Capital Management L.P.) Pursuant to an agreement with Tengram Capital Partners, L.P., formerly known as Tengram Capital Management, L.P. (“TCP”), an affiliate of Tengram Capital Partners Gen2 Fund, L.P., which is one of the Company’s largest stockholders, the Company has engaged TCP, effective as of January 1, 2013, to provide services to the Company pertaining to (i) mergers and acquisitions, (ii) debt and equity financing and (iii) such other related areas as the Company may reasonably request from time to time (the “TCP Agreement”). TCP is entitled to receive compensation of $ 1.0 5 0.9 The Company paid TCP approximately $ 0.9 0.5 0.9 Additionally, in July 2013, the Company entered into a consulting arrangement with an employee of TCP (the “TCP Employee”), pursuant to which the TCP Employee provides legal and other consulting services at the request of the Company from time to time. The TCP Employee was also issued 125,000 180,000 20 20 60 0.2 0.1 0.3 Transactions with E.S. Originals, Inc. A division president of the Company maintains a passive ownership interest in one of the Company’s licensees, E.S. Originals, Inc. (“ESO”). The Company receives royalties from ESO under license agreements for certain of the Company’s brands in the footwear category. The Company recorded approximately $ 3.0 3.4 11.2 10.5 4.8 4.1 Acquisition of FUL On November 17, 2014, the Company made a strategic investment in FUL IP. FUL IP is a collaborative investment between the Company and JALP. FUL IP was formed for the purpose of licensing the FUL FUL FUL 8.9 50.5 0.1 0.4 Investment in Available-for-Sale Securities As further discussed in Note 2, in September 2015, the Company purchased available-for-sale securities of an unaffiliated third-party publicly traded company from Tengram Capital Partners, L.P., which is an affiliate of Tengram Capital Partners Gen2 Fund, L.P., one of the Company’s largest stockholders, for an aggregate purchase price of approximately $12.0 million (plus related transaction expenses), which was the purchase price paid by Tengram Capital Partners, L.P. upon the acquisition of such available-for-sale securities in open market transactions. The Company did not pay a fee or any compensation to Tengram Capital Partners, L.P. in connection with the Company’s investment in the available-for-sale securities. Intangible Asset Agreement and IP License Agreement In connection with the transactions contemplated by the Mergers, MSLO entered into an Amended and Restated Asset License Agreement (“Intangible Asset Agreement”) and Amended and Restated Intellectual Property License and Preservation Agreement (“IP License Agreement” and, together with the Intangible Asset Agreement, the “IP Agreements”) pursuant to which Ms. Martha Stewart licensed certain intellectual property to MSLO. The IP Agreements grant the Company the right to use of certain properties owned by Ms. Stewart. The Intangible Asset Agreement has an initial term commencing at December 4, 2015 and ending on December 31, 2020, provided that the term will automatically be renewed for five additional calendar years ending December 31, 2025 (subject to earlier termination as provided in the employment agreement) if either the aggregate gross licensing revenues (as defined in the employment agreement) for calendar years 2018 through 2020 exceed $195 million or the gross licensing revenues for calendar year 2020 equal or exceed $65 million. 1.7 0.1 During the term of the IP License Agreement with the Company, Ms. Stewart will be entitled to receive a guaranteed annual payment of $ 1.3 0.2 0.6 0.3 1.0 Registration Rights Agreement On June 22, 2015, Martha Stewart, the Martha Stewart Family Limited Partnership, Alexis Stewart, the Martha Stewart 1999 Family Trust, the Martha Stewart 2000 Family Trust and the Martha and Alexis Stewart Charitable Foundation (collectively, the “Stewart Stockholders”) entered into an agreement (the “Registration Rights Agreement”) with the Company, which grants the Stewart Stockholders certain “demand” registration rights for up to two offerings of greater than $15 million each, certain “S-3” registration rights for up to three offerings of greater than $5 million each |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Martha Stewart Living Omnimedia, Inc. | 11. Acquisitions Martha Stewart Living Omnimedia, Inc. On December 4, 2015, Old Sequential and MSLO, consummated the transactions contemplated by the Merger Agreement. Effective on December 4, 2015 as of the effective time under the Merger Agreement (the “Effective Time”), Singer Merger Sub, Inc. and Madeline Merger Sub, Inc., each wholly-owned subsidiaries of the Company, merged with and into Old Sequential and MSLO, respectively, with Old Sequential and MSLO surviving the mergers as wholly-owned subsidiaries of the Company (the “Mergers”), in accordance with the Merger Agreement. The Mergers were approved by the stockholders of MSLO at a special meeting of the MSLO stockholders on December 2, 2015 and by a majority of Old Sequential’s stockholders on June 22, 2015. As a result of the Mergers, the Company became the ultimate parent of Old Sequential, MSLO and each of their respective subsidiaries. Under the terms of the Merger Agreement, subject to each stockholder’s election and proration, allocation and certain limitations set forth in the Merger Agreement, each issued and outstanding share of MSLO’s Class A common stock, par value $ 0.01 0.01 6.15 0.01 8.8393 As the aggregate amount of cash to be paid to MSLO stockholders was fixed in the Merger Agreement at $ 176,681,757 176,681,757 19,980,787 176,681,757 40,314 40,436,798 As part of the Merger Agreement, the Company also issued 33,939 Shares of MSLO’s common stock were suspended from trading on the NYSE prior to the open of trading on December 4, 2015. Shares of Old Sequential’s common stock were suspended from trading on the Nasdaq prior to the open of trading on December 7, 2015 and shares of the Company’s common stock began trading on the Nasdaq at the open of trading on December 7, 2015 under the ticker symbol “SQBG.” 1.7 As part of the Merger Agreement, the Company paid approximately $ 14.2 employee held to acquire shares of MSLO common stock. Allocated to: Goodwill $ 1,749 Legacy payments (1,749) $ - Allocated to: Prepaid expenses and other current assets $ 826 Property and equipment 1,717 Goodwill (12,998) Trademarks 16,398 Customer agreements (8) Accounts payable and accrued expenses (40) Deferred tax liability (5,895) $ - The Mergers were accounted for under the acquisition method of accounting. Accordingly, the acquired assets were recorded at their estimated fair values, and operating results for the Martha Stewart Cash paid $ 176,722 Fair value of common stock issued (20,014,726 shares) 185,937 Total consideration $ 362,659 Allocated to: Cash $ 39,095 Accounts receivable 17,524 Prepaid expenses and other current assets 1,524 Property and equipment 5,376 Other non-current assets 958 Goodwill 128,713 Trademarks 329,770 Customer agreements 632 Accounts payable and accrued expenses (11,158) Guaranteed contractual payments (12,826) Payments to seller (3,250) Consideration paid to MSLO employees/directors for stock awards (14,227) Legacy payments (1,749) Long-term liabilities (452) Other deferred revenue (1,717) Deferred tax liability (115,554) $ 362,659 Goodwill arising from the acquisition mainly consists of the synergies of an ongoing licensing and brand management business. Trademarks have been determined by management to have an indefinite useful life and, accordingly, no amortization is recorded in the Company’s unaudited condensed consolidated statement of operations. Goodwill and trademarks are tested for impairment on an annual basis or sooner, if an event occurs or circumstances change that indicate that the carrying amount of the goodwill or trademarks may not be recoverable. Customer agreements are amortized on a straight-line basis over their expected useful lives of four years. Gaiam Brand Holdco, LLC On July 1, 2016, the Company, together with its wholly-owned subsidiary, SBG-Gaiam Holdings LLC (formerly known as Stretch & Bend Holdings LLC), a Delaware limited liability company (“SBG-Gaiam” or the “Purchaser”) completed the acquisition pursuant to the terms of the Membership Interest Purchase Agreement (the “Purchase Agreement”) with GAIAM, Inc., a Colorado corporation (“Seller”) pursuant to which Purchaser agreed to acquire the branded consumer business of Seller for a total purchase price of approximately $ 145.7 As part of the Purchase Agreement, the Company paid approximately $ 1.9 GAIAM SPRI Total consideration paid $ 147,587 Allocated to: Goodwill $ 2,087 Trademarks 145,700 Accrued expenses (200) $ 147,587 The Company is currently evaluating the fair value of the acquired trademarks and equity method investment. The Company and Gaiam Brand Holdco, LLC elected to treat the acquisition as an asset acquisition under section 338(h)(10) of the United States Internal Revenue Service tax code. As such, the Company is not required to record a deferred tax liability in connection with the acquisition. Goodwill arising from the acquisition mainly consists of the synergies of an ongoing licensing and brand management business. Trademarks have been determined by management to have an indefinite useful life and, accordingly, no amortization is recorded in the Company’s unaudited condensed consolidated statement of operations. Goodwill and trademarks are tested for impairment on an annual basis or sooner, if an event occurs or circumstances change that indicate that the carrying amount of the goodwill or trademarks may not be recoverable. The Company incurred legal and other costs related to the transaction of approximately $ 3.8 Total revenues and income from continuing operations since the date of the acquisition of the GAIAM SPRI 6.0 5.8 Pro Forma Information The following unaudited consolidated pro forma information gives effect to the transaction contemplated by the Gaiam, Inc. acquisition as if such transaction had occurred on January 1, 2015. The following pro forma information is presented for illustration purposes only and is not necessarily indicative of the results that would have been attained had the acquisition been completed on January 1, 2015, nor is it indicative of results that may occur in any future periods. Pro forma information has not been provided for the Gaiam Inc. acquisition for the three and nine month periods ended September 30, 2015 as the portion of Gaiam acquired was a component of a larger legal entity for which separate historical financial statements were not prepared. Three Months Ended Nine Months Ended September 30, 2016 September 30, 2016 (in thousands, except share and per share data) Revenues $ 42,584 $ 110,746 Income (loss) from continuing operations $ 23,199 $ (16,867) Net loss attributable to Sequential Brands Group, Inc. and Subsidiaries $ (1,232) $ (30,941) Loss per share: Basic $ (0.02) $ (0.50) Diluted $ (0.02) $ (0.50) Weighted average shares outstanding: Basic 62,176,700 61,817,742 Diluted 62,176,700 61,817,742 On August 15, 2014, the Company completed the acquisition of Galaxy Brand Holdings, Inc. As set forth in the acquisition agreement and included in the consideration, the Company held back ten percent of the acquisition shares as an indemnity for 18 1,375,000 |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | 12. Restructuring During the three months ended September 30, 2016, the Company recorded approximately $ 0.4 3.2 1.7 0.8 0.3 0.4 On a cumulative basis, the Company has recorded $ 11.9 65 The Company did not incur restructuring charges for the three and nine months ended September 30, 2015. Restructuring accruals of approximately $ 1.6 6.9 8.9 Severance & Related Contract Termination Benefits Costs Professional Fees Total Accrual (in thousands) Balance at January 1, 2016 $ 4,644 $ 1,628 $ 579 $ 6,851 Charges to expense 1,687 342 755 2,784 Amounts paid (6,231) (445) (1,334) (8,010) Balance at September 30, 2016 $ 100 $ 1,525 $ - $ 1,625 The remaining severance and related benefits, contract termination costs and professional fees are expected to be paid by the end of fiscal 2016. |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | 13. New Accounting Pronouncements In August 2016, the FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”). ASU 2016-15 amends the guidance in ASC 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of ASU 2016-15 is to reduce the diversity in practice that has resulted from the lack of consistent principles on this topic. The amendments in ASU 2016-15 add or clarify guidance on eight cash flow issues: ⋅ Debt prepayment or debt extinguishment costs. ⋅ Settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing. ⋅ Contingent consideration payments made after a business combination. ⋅ Proceeds from the settlement of insurance claims. ⋅ Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies. ⋅ Distributions received from equity method investees. ⋅ Beneficial interests in securitization transactions. ⋅ Separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for annual and interim periods beginning after December 15, 2017, and early adoption is permitted for all entities. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively from the earliest date practicable if retrospective application would be impracticable. The Company is currently evaluating the impact the adoption of ASU 2016-15 will have on the Company’s consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Customers with Contracts (Topic 606) Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”). ASU 2016-12 amends certain aspects of ASU No. 2014-09, “Revenue from Customers with Contracts (Topic 606)”. The amendments which were issued in response to feedback received by the FASB-International Accounting Standards Board joint revenue recognition Transition Resource Group, include the following: ⋅ Collectibility ⋅ Presentation of sales tax and other similar taxes collected from customers ⋅ Noncash consideration ⋅ Contract modifications and completed contracts at transition ⋅ Transition technical correction ASU 2016-12 is effective for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted as of the original effective date, December 31, 2016. The Company is currently evaluating the impact the adoption of ASU 2016-12 will have on the Company’s consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-11, “Rescission of SEC Guidance Because of Accounting Standards Update 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting” (“ASU 2016-11”). ASU 2016-11 rescinds certain SEC guidance from the FASB ASC ⋅ Upon the adoption of ASU 2014-09: o Revenue and expense recognition for freight services in process (ASC 605-20-S99-2) o Accounting for shipping and handling fees and costs (ASC 605-45-S99-1) o Accounting for consideration given by a vendor to a customer (ASC 605-50-S99-1) o Accounting for gas-balancing arrangements (ASC 932-10-S99-5). ⋅ Upon the adoption of ASU 2014-16: o Determining the nature of a host contract related to a hybrid financial instrument issued in the form of a share under ASC 815 (ASC 815-10-S99-3) ASU 2016-11 is effective upon the adoption of ASU 2014-09 and ASU 2014-16. The adoption of ASU 2016-11 is not expected to have a material impact on the Company’s consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, “Identifying Performance Obligations and Licensing” (“ASU 2016-10”). ASU 2016-10 amends certain aspects of the guidance in ASU 2014-09 on (1) identifying performance obligations and (2) licensing. The amendments include the following: ⋅ Identifying performance obligations: o Immaterial promised goods or services o Shipping and handling activities o Identifying when promises represent performance obligations ⋅ Licensing implementation guidance: o Determining the nature of an entity’s promise in granting a license o Sales-based and usage based royalties o Restriction of time, geographical location, and use o Renewals of licenses that provide a right to use IP ASU 2016-10 is effective for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted as of the original effective date, December 31, 2016. The Company is currently evaluating the impact the adoption of ASU 2016-02 will have on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, “Simplifying the Accounting for Share-Based Payments” (“ASU 2016-09”). ASU 2016-09 simplifies several aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The new guidance, which is part of the Board’s simplification initiative, also contains two practical expedients under which nonpublic entities can use a simplified method to estimate the expected term of an award and make a one-time election to switch from fair value measurement to intrinsic value measurement for liability-classified awards. ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those annual reporting periods. The adoption of ASU 2016-09 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, “Simplifying the Equity Method of Accounting” (“ASU 2016-07”). ASU 2016-07 simplifies the equity method of accounting by eliminating the requirement to retrospectively apply the equity method to an investment that subsequently qualifies for such accounting as a result of an increase in the level of ownership interest or degree of influence. Consequently, when an investment qualifies for the equity method (as a result of an increase in the level of ownership interest or degree of influence), the cost of acquiring the additional interest in the investee would be added to the current basis of the investor’s previously held interest and the equity method would be applied subsequently from the date on which the investor obtains the ability to exercise significant influence over the investee. ASU 2016-07 further requires that unrealized holding gains or losses in accumulated other comprehensive income related to an available-for-sale security that becomes eligible for the equity method be recognized in earnings as of the date on which the investment qualifies for the equity method. ASU 2016-07 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, with early adoption permitted. Entities are required to apply the guidance prospectively to increases in the level of ownership interest or degree of influence occurring after the effective date of ASU 2016-07. Additional transition disclosures are not required upon adoption. The adoption of ASU 2016-07 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-05, “Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships” (“ASU 2016-05”). ASU 2016-05 clarifies that “a change in the counterparty to a derivative instrument that has been designated as the hedging instrument in an existing hedging relationship would not, in and of itself, be considered a termination of the derivative instrument” or “a change in a critical term of the hedging relationship”. As long as all other hedge accounting criteria in ASC 815 are met, a hedging relationship in which the hedging derivative instrument is novated would not be discontinued or need to be redesignated. This clarification applies to both cash flow and fair value hedging relationships. ASU 2016-05 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. An entity would apply the guidance prospectively unless it elects modified retrospective transition. Early adoption is permitted, including in an interim period. The adoption of ASU 2016-05 is not expected to have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”). The core principle of ASU 2016-02 is that an entity should recognize on its balance sheet assets and liabilities arising from a lease. In accordance with that principle, ASU 2016-02 requires that a lessee recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying leased asset for the lease term. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend on the lease classification as a finance or operating lease. This new accounting guidance is effective for public companies for fiscal years beginning after December 15, 2018 (i.e., calendar years beginning on January 1, 2019), including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of ASU 2016-02 will have on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-01, “Amending Guidance on Classification and Measurement of Financial Instruments” (“ASU 2016-01”). ASU 2016-01 amends the guidance in U.S. GAAP on the classification and measurement of financial instruments. Although ASU 2016-01 retains many current requirements, it significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. ASU 2016-01 also amends certain disclosure requirements associated with the fair value of financial instruments. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of ASU 2016-01 is not expected to have a material impact on the Company’s consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16, “Business Combinations Simplifying the Accounting for Measurement-Period Adjustments” (“ASU 2015-16”). ASU 2015-16 requires the recognition of adjustments to provisional amounts that are identified during the measurement period, in the reporting period in which the adjustments are determined. The effects of the adjustments to provisional amounts on depreciation, amortization or other income effects should be recognized in current-period earning as if the accounting had been completed at the acquisition date. Disclosure of the portion of the adjustment recorded in current-period earnings that would have been reported in prior reporting periods if the adjustment to the provisional amounts had been recognized at the acquisition date is also required. ASU 2015-16 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. The Company adopted the provisions of ASU 2015-16 during the first quarter of 2016. The adoption of ASU 2015-16 did not have a material impact on the Company’s consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, “Interest Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”), which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs on the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The standard’s core principle is that debt issuance costs related to a note are reflected in the balance sheet as a direct deduction from the face amount of that note and amortization of debt issuance costs is reported in interest expense. ASU 2015-03 is effective for annual periods beginning after December 15, 2015, and interim periods within those years. Early adoption is allowed for all entities for financial statements that have not been previously issued. Entities would apply the new guidance retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). The Company adopted the provisions of ASU 2015-03 during the first quarter of 2016. The adoption of ASU 2015-03 did not have a material impact on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”), which contains a new comprehensive revenue recognition standard that will supersede all existing revenue recognition guidance. ASU No. 2014-09 requires that a company recognize revenue at the time it transfers promised goods or services to a customer and in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASU No. 2014-09 is effective for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted as of the original effective date, December 31, 2016. Companies have the option of using either a full retrospective approach or a modified approach to adopt in ASU No. 2014-09. The Company is currently evaluating the impact the adoption of ASU 2014-09 will have on the Company’s consolidated financial statements. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the United States Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all of the information and footnotes necessary for a comprehensive presentation of financial position, results of operations or cash flows. It is the Company’s opinion that the accompanying unaudited condensed consolidated financial statements include all adjustments, which are of a normal recurring nature necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the SEC on March 14, 2016, which contains the audited consolidated financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, for the years ended December 31, 2015, 2014 and 2013. The financial information as of December 31, 2015 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. The interim results for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016 or for any future interim periods. |
Reclassification of Prior Year Presentation and Correction of Immaterial Error | Reclassification of Prior Year Presentation and Correction of Immaterial Error On January 1, 2016, the Company adopted Accounting Standards Update (“ASU”) No. 2015-03 “Interest Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”), which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs on the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The standard’s core principle is that debt issuance costs related to a note are reflected in the balance sheet as a direct deduction from the face amount of that note and amortization of debt issuance costs is reported in interest expense. As a result of the adoption of ASU 2015-03, the Company has reclassified certain balance sheet accounts for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. The Company reclassified approximately $ 7.9 Additionally, the Company has corrected an immaterial error in its condensed consolidated statement of cash flows for the nine months ended September 30, 2015. This correction is related to the payment of certain guaranteed obligations in connection with previous acquisitions and reflects an increase in cash provided by operating activities of approximately $ 1.3 1.3 |
Principles of Consolidation | Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with 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 unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited condensed consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results could differ significantly from estimates. |
Discontinued Operations | Discontinued Operations The Company has accounted for the closure of its wholesale operations during 2013 as discontinued operations in accordance with the guidance provided in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360, Accounting for Impairment or Disposal of Long-Lived Assets Presentation of Financial Statements |
Revenue Recognition | Revenue Recognition The Company has entered into various license agreements that provide revenues based on guaranteed minimum royalty payments and advertising/marketing fees with additional royalty revenues based on a percentage of defined sales. Guaranteed minimum royalty payments and advertising/marketing revenue are recognized on a straight-line basis over the term of each contract year, as defined in each license agreement. Royalty payments exceeding the guaranteed minimum royalty payments are recognized as income during the period corresponding to the licensee’s sales. Payments received as consideration for the grant of a license are recorded as deferred revenue at the time payment is received and recognized ratably as revenue over the term of the license agreement. Advanced royalty payments are recorded as deferred revenue at the time payment is received and recognized as revenue as earned. Revenue is not recognized unless collectability is reasonably assured. If license agreements are terminated prior to the original licensing period, the Company recognizes revenue in the amount of any contractual termination fees, unless such amounts are deemed non-recoverable. With respect to editorial content for books, the Company receives advance payments from the Company’s publishers and recognizes revenue when manuscripts are delivered to and accepted by the publishers. Revenue is also earned from book publishing when sales on a unit basis exceed the advanced royalty. Television sponsorship revenues are generally recorded ratably across the period when new episodes initially air. |
Restricted Cash | Restricted Cash Restricted cash at September 30, 2016 consists of cash deposited with a financial institution required as collateral for the Company’s cash-collateralized letter of credit facilities. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded net of allowances for doubtful accounts, based on the Company’s ongoing discussions with its licensees and other customers and its evaluation of their creditworthiness, payment history and account aging. Accounts receivable balances deemed to be uncollectible are charged to the allowance for doubtful accounts after all means of collection have been exhausted and the potential for recovery is considered remote. The allowance for doubtful accounts was approximately $ 0.4 0.3 The Company’s accounts receivable amounted to approximately $ 44.2 42.0 25 14 11 26 15 11 |
Investments | The unrealized gains and losses on the available-for-sale securities held by the Company as of September 30, 2016 and December 31, 2015 are set forth below. September 30, 2016 Gross Unrealized Historical Cost Estimated Fair Value Gains Losses (in thousands) Available-for-sale securities $ 12,048 $ 6,671 $ - $ 5,377 December 31, 2015 Gross Unrealized Historical Cost Estimated Fair Value Gains Losses (in thousands) Available-for-sale securities $ 12,048 $ 5,611 $ - $ 6,437 As of both September 30, 2016 and December 31, 2015, the Company has concluded that the decline in fair value of its available-for-sale securities is not other-than-temporary. The available-for-sale securities have been in a loss position for twelve months. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. In evaluating goodwill for impairment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Qualitative factors considered include, for example, macroeconomic and industry conditions, overall financial performance and other relevant entity-specific events. If the Company bypasses the qualitative assessment, or concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, it then performs a two-step goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment to be recognized, if any. In the first step, the Company will compare the estimated fair value of the reporting unit with its carrying value. The Company has determined it has a single reporting unit, and considers its market capitalization (calculated as total common shares outstanding multiplied by the common equity price per share, as adjusted for a control premium factor) to represent its estimated fair value. If the estimated fair value of the reporting unit exceeds its carrying amount, no further analysis is needed. If, however, the estimated fair value of the reporting unit is less than its carrying amount, the Company will proceed to the second step and calculate the implied fair value of the reporting unit goodwill to determine whether any impairment is required. The implied fair value of the reporting unit goodwill is calculated by allocating the estimated fair value of the reporting unit to all of the unit’s assets and liabilities as if the unit had been acquired in a business combination. If the carrying value of the reporting unit’s goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in the amount of that excess. Intangible assets represent trademarks, customer agreements and patents related to the Company’s brands and a favorable lease. Finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. Indefinite-lived intangible assets are not amortized, but instead are subject to impairment evaluation. The carrying value of intangible assets and other finite-lived assets is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are tested for impairment on an annual basis and between annual tests if an event occurs or circumstances change that indicate that the carrying amount of the indefinite-lived intangible asset may not be recoverable. When conducting its impairment assessment, the Company initially performs a qualitative evaluation of whether it is more likely than not that the asset is impaired. If it is determined by a qualitative evaluation that it is more likely than not that the asset is impaired, the Company then tests the asset for recoverability. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to its expected future undiscounted net cash flows. If the carrying amount of such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the recoverability of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. During the nine months ended September 30, 2016, the Company changed its annual impairment testing date from December 31 to October 1. The Company believes this new date is preferable because it allows for more timely completion of the annual impairment test prior to the end of its annual financial reporting period. The Company has concluded that this change in accounting principle is not material to its financial statements, in part because the change does not delay, accelerate or avoid an impairment charge. The Company has determined that it will be impracticable to objectively determine projected cash flow and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. As such, the Company will apply the change in annual impairment testing date prospectively beginning October 1, 2016. |
Treasury Stock | Treasury Stock Treasury stock is recorded at cost as a reduction of equity in the accompanying condensed consolidated balance sheets. |
Stock-Based Compensation | Stock-Based Compensation Compensation cost for restricted stock is measured using the quoted market price of the Company’s common stock at the date the common stock is granted. For restricted stock, for which restrictions lapse with the passage of time (“time-based restricted stock”), compensation cost is recognized on a straight-line basis, reduced for estimated forfeitures, over the period between the issue date and the date that restrictions lapse. Time-based restricted stock is included in total shares of common stock outstanding upon the lapse of applicable restrictions. For restricted stock, for which restrictions are based on performance measures (“performance stock units” or “PSUs”), restrictions lapse when those performance measures have been deemed achieved. Compensation cost for PSUs is recognized on a straight-line basis, reduced for estimated forfeitures, during the period from the date on which the likelihood of the PSUs being earned is deemed probable and (x) the end of the fiscal year during which such PSUs are granted or (y) the date on which awards of such PSUs may be approved by the compensation committee of the Company’s board of directors (the “Compensation Committee”) on a discretionary basis, as applicable. PSUs are included in total shares of common stock outstanding upon the lapse of applicable restrictions. PSUs are included in total diluted shares of common stock outstanding when the performance measures have been deemed achieved but the PSUs have not yet been issued. Compensation cost for stock options and warrants, in accordance with accounting for stock-based payment under GAAP, is calculated using the Black-Scholes valuation model based on awards ultimately expected to vest, reduced for estimated forfeitures, and expensed on a straight-line basis over the requisite service period of the grant. Forfeitures are estimated at the time of grant based on the Company’s historical forfeiture experience and are revised in subsequent periods if actual forfeitures differ from those estimates. At each subsequent reporting period prior to the lapse of restrictions on warrants, time-based restricted stock and PSUs granted to non-employees, the Company remeasures the aggregate compensation cost of such grants using the Company’s stock price at the end of such reporting period and revises the straight-line recognition of compensation cost in-line with such remeasured amount. |
Income Taxes | Income Taxes Current income taxes are based on the respective periods’ taxable income for federal, foreign and state income tax reporting purposes. Deferred tax liabilities and assets are determined based on the difference between the financial statement and income tax bases of assets and liabilities, using statutory tax rates in effect for the year in which the differences are expected to reverse. In accordance with ASU No. 2015-17 “Balance Sheet Classification of Deferred Taxes”, all deferred income taxes are reported and classified as non-current. A valuation allowance is required if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company applies the FASB guidance on accounting for uncertainty in income taxes. The guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with other authoritative GAAP and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The guidance also addresses derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. At September 30, 2016 and December 31, 2015, the Company had $ 0.6 |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments which potentially expose the Company to credit risk consist primarily of cash, restricted cash, accounts receivable and marketable securities. Cash is held to meet working capital needs and future acquisitions. Restricted cash is cash pledged as collateral for a comparable amount of irrevocable standby letters of credit for certain of the Company’s leased properties. Substantially all of the Company’s cash, restricted cash and marketable securities are deposited with high quality financial institutions. At times, however, such cash, restricted cash and marketable securities may be in deposit accounts that exceed the Federal Deposit Insurance Corporation insurance limit. The Company has not experienced any losses in such accounts as of September 30, 2016. Concentration of credit risk with respect to accounts receivable is minimal due to the collection history and the nature of the Company’s revenues. |
Customer Concentrations | Customer Concentrations The Company recorded net revenues of approximately $ 42.0 23.0 10 10 16 15 The Company recorded net revenues of approximately $ 110.1 56.8 10 10 10 19 16 |
Loss Contingencies | Loss Contingencies The Company recognizes contingent losses that are both probable and estimable. In this context, probable means circumstances under which events are likely to occur. The Company records legal costs pertaining to contingencies as incurred. |
Contingent Consideration | Contingent Consideration The Company recognizes the acquisition-date fair value of contingent consideration as part of the consideration transferred in exchange for the acquiree or assets of the acquiree in a business combination. The contingent consideration is classified as either a liability or equity in accordance with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity |
Noncontrolling Interest | Noncontrolling Interest Noncontrolling interest from continuing operations recorded for the three and nine months ended September 30, 2016 represents income allocations to Elan Polo International, Inc., a member of DVS Footwear International, LLC (“DVS LLC”), With You, Inc., a member of With You LLC (the partnership between the Company and Jessica Simpson) and JALP, LLC (“JALP”), a member of FUL IP Holdings, LLC (“FUL IP”). Noncontrolling interest from continuing operations recorded for the three and nine months ended September 30, 2015 represents income allocations to DVS LLC and With You LLC. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) (in thousands) With You LLC $ 1,757 $ 1,470 $ 5,025 $ 3,163 DVS LLC 140 153 423 454 FUL IP 125 - 366 - Net income attributable to noncontrolling interest $ 2,022 $ 1,623 $ 5,814 $ 3,617 |
Reportable Segment | Reportable Segment An operating segment, in part, is a component of an enterprise whose operating results are regularly reviewed by the chief operating decision maker (the “CODM”) to make decisions about resources to be allocated to the segment and assess its performance. Operating segments may be aggregated only to a limited extent. The Company’s CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis, accompanied by disaggregated information about revenues for purposes of making operating decisions and assessing financial performance. Accordingly, the Company has a single operating and reportable segment. In addition, the Company has no foreign operations or any material assets in foreign locations. Nearly all of the Company’s operations consist of a single revenue stream, which is the licensing of its trademark portfolio, with an immaterial portion of revenues derived from television, book, café operations and certain commissions |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Investment | The unrealized gains and losses on the available-for-sale securities held by the Company as of September 30, 2016 and December 31, 2015 are set forth below. September 30, 2016 Gross Unrealized Historical Cost Estimated Fair Value Gains Losses (in thousands) Available-for-sale securities $ 12,048 $ 6,671 $ - $ 5,377 December 31, 2015 Gross Unrealized Historical Cost Estimated Fair Value Gains Losses (in thousands) Available-for-sale securities $ 12,048 $ 5,611 $ - $ 6,437 |
Basic And Diluted Earnings (Loss) Per Common Share | The shares used to calculate basic and diluted EPS consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Basic weighted-average common shares outstanding 62,176,700 39,781,868 61,817,742 39,384,090 Acquisition hold back shares - 1,375,000 230,840 1,375,000 Warrants 360,440 565,239 351,386 528,837 Stock options 18,252 37,798 15,406 108,587 Performance stock awards 407,355 139,889 408,152 47,142 Unvested restricted stock 104,010 206,262 95,064 195,479 Diluted weighted-average common shares outstanding 63,066,757 42,106,056 62,918,590 41,639,135 |
Earnings Per Share, Basic and Diluted | The computation of diluted EPS for the three and nine months ended September 30, 2016 and 2015 excludes the common stock equivalents of the following potentially dilutive securities because their inclusion would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Warrants 325,000 - 325,000 - Unvested restricted stock - - 130,000 - Stock options 51,000 20,000 51,000 30,000 Total 376,000 20,000 506,000 30,000 |
Noncontrolling Interest | The following table sets forth the noncontrolling interest from continuing operations for the three and nine months ended September 30, 2016 and 2015: Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) (in thousands) With You LLC $ 1,757 $ 1,470 $ 5,025 $ 3,163 DVS LLC 140 153 423 454 FUL IP 125 - 366 - Net income attributable to noncontrolling interest $ 2,022 $ 1,623 $ 5,814 $ 3,617 |
Fair Value Measurement of Fin23
Fair Value Measurement of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table sets forth the carrying value and the fair value of the Company’s financial assets and liabilities required to be disclosed at September 30, 2016 and December 31, 2015: Carrying Value Fair Value Financial Instrument Level 9/30/2016 12/31/2015 9/30/2016 12/31/2015 (in thousands) Available-for-sale securities 1 $ 6,671 $ 5,611 $ 6,671 $ 5,611 Interest rate swap 2 $ 11 $ 29 $ 11 $ 29 2016 Term Loans 3 $ 587,500 $ - $ 554,132 $ - 2016 Revolving Loan 3 $ 80,500 $ - $ 59,812 $ - 2015 Term Loans 3 $ - $ 464,000 $ - $ 446,320 2015 Revolving Loan 3 $ - $ 86,000 $ - $ 62,880 LNT Contingent Earn Out 3 $ - $ - $ - $ - Legacy Payments 3 $ 1,936 $ - $ 1,936 $ - |
Schedule of Notional Amounts of Outstanding Derivative Positions | The components of the swap agreement as of September 30, 2016, are as follows: Notional Value Derivative Asset Derivative Liability (in thousands) Term Loans $ 19,000 $ - $ 11 |
Discontinued Operations of Wh24
Discontinued Operations of Wholesale Business (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Discontinued Operations, Wholesale Business Segment | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Components Of Discontinued Operations, Balance Sheet | September 30, December 31, 2016 2015 (in thousands) Prepaid expenses and other current assets $ 83 $ 113 Long-term liabilities $ 639 $ 677 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill, Impaired [Abstract] | |
Schedule of Goodwill | Changes in the carrying amount of goodwill for the nine months ended September 30, 2016 are as follows: September 30, 2016 (in thousands) Balance at January 1 $ 314,288 Acquisition of Martha Stewart Living Omnimedia, Inc. (see Note 11) (11,249) Acquisition of Gaiam, Inc. Branded Consumer Business (see Note 11) 2,087 Ending balance $ 305,126 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Summary of intangible assets | Intangible assets are summarized as follows: September 30, 2016 Useful Lives Gross Accumulated Net (in thousands) Finite-lived intangible assets: Trademarks 15 $ 4,971 $ (1,475) $ 3,496 Customer agreements 4 2,809 (1,559) 1,250 Favorable lease 2 537 (498) 39 Patents 10 665 (214) 451 $ 8,982 $ (3,746) 5,236 Indefinite-lived intangible assets: Trademarks 1,028,506 Intangible assets, net $ 1,033,742 December 31, 2015 Useful Lives Gross Accumulated Net (in thousands) Finite-lived intangible assets: Trademarks 15 $ 4,905 $ (1,228) $ 3,677 Customer agreements 4 2,817 (1,017) 1,800 Favorable lease 2 537 (322) 215 Patents 10 665 (164) 501 $ 8,924 $ (2,731) 6,193 Indefinite-lived intangible assets: Trademarks 866,084 Intangible assets, net $ 872,277 |
Summary of future annual estimated amortization expense | Estimated future annual amortization expense for intangible assets in service as of September 30, 2016 is summarized as follows: Years ending December 31, (in thousands) Remainder of 2016 $ 314 2017 907 2018 775 2019 587 2020 398 Thereafter 2,255 $ 5,236 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure Long Term Debt [Abstract] | |
Schedule of long term debt | The components of long-term debt are as follows: September 30, December 31, 2016 2015 (in thousands) Secured Term Loans $ 587,500 $ 464,000 Revolving Credit Facility 80,500 86,000 Unamortized deferred financing costs (18,829) (7,935) Total long-term debt, net of unamortized deferred financing costs 649,171 542,065 Less: current portion of long-term debt 26,225 19,000 Long-term debt $ 622,946 $ 523,065 |
Schedule of Line of Credit Facilities | Specifically, the applicable margin with respect to LIBOR loans under the GSO Term Loan Agreement were as set forth below: Applicable Margin LIBOR Consolidated Total Leverage Ratio Consolidated Net Leverage Ratio Loans > 6.00 : 1.00 ≥ 5.75 : 1.00 8.75 % ≥ 4.75 : 1.00 ≤ 6.00 : 1.00 ≥ 4.50 : 1.00 < 5.75 : 1.00 8.25 % < 4.75 : 1.00 < 4.50 : 1.00 8.00 % |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Option Activity | The following table summarizes the Company’s stock option activity for the nine months ended September 30, 2016: Weighted- Average Weighted- Remaining Number of Average Exercise Contractual Life Aggregate Options Price (in Years) Intrinsic Value (in thousands, except share and per share data) Outstanding - January 1, 2016 129,501 $ 9.65 3.3 $ 148 Granted - - Exercised - - Forfeited or Canceled - - Outstanding - September 30, 2016 129,501 $ 9.65 2.7 $ 153 Exercisable - September 30, 2016 124,501 $ 9.77 2.7 $ 147 A summary of the changes in the Company’s unvested stock options is as follows: Weighted- Number of Average Grant Options Date Fair Value Unvested - January 1, 2016 21,000 $ 2.71 Granted - - Vested (16,000) (2.94) Forfeited or Canceled - - Unvested - September 30, 2016 5,000 $ 1.96 |
Black- Scholes Option-Pricing Model | These stock options had a fair value of less than $ 0.1 Risk-free interest rate 0.90 % Expected dividend yield 0.00 % Expected volatility 32.10 % Expected life 3.00 years |
Schedule of Warrants Activity | The following table summarizes the Company’s outstanding warrants for the nine months ended September 30, 2016: Weighted- Average Weighted- Remaining Number of Average Exercise Contractual Life Aggregate Warrants Price (in Years) Intrinsic Value (in thousands, except share and per share data) Outstanding - January 1, 2016 801,760 $ 7.87 4.1 $ 1,377 Granted - - Exercised - - Forfeited or Canceled - - Outstanding - September 30, 2016 801,760 $ 7.87 3.3 $ 1,420 Exercisable - September 30, 2016 726,760 $ 7.31 2.8 $ 1,420 A summary of the changes in the Company’s unvested warrants is as follows: Weighted- Number of Average Grant Warrants Date Fair Value Unvested - January 1, 2016 150,000 $ 6.32 Granted - - Vested (75,000) 6.32 Forfeited or Canceled - - Unvested - September 30, 2016 75,000 $ 6.32 These warrants had a fair value of $ 1.3 Risk-free interest rate 2.16 % Expected dividend yield 0.00 % Expected volatility 45.84 % Expected life 7.25 years |
Schedule of Restricted Stock Activity | A summary of the time-based restricted stock and time-based restricted stock units activity for the nine months ended September 30, 2016 is as follows: Weighted- Average Weighted- Remaining Number of Average Grant Contractual Life Aggregate Shares Date Fair Value (in Years) Intrinsic Value (in thousands, except share and per share data) Unvested - January 1, 2016 510,653 $ 9.89 2.0 $ 510 Granted 280,548 6.58 Vested (187,985) 7.29 Unvested - September 30, 2016 603,216 $ 9.16 1.9 $ 589 A summary of the PSUs activity for the nine months ended September 30, 2016 is as follows: Weighted- Average Weighted- Remaining Number of Average Grant Contractual Life Aggregate Shares Date Fair Value (in Years) Intrinsic Value (in thousands, except share and per share data) Unvested - January 1, 2016 1,308,500 $ 10.98 1.4 $ 96 Granted 30,000 7.23 Vested (317,833) (9.58) Forfeited or Cancelled (39,300) (5.74) Unvested - September 30, 2016 981,367 $ 11.53 0.7 $ 23 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Schedule Of Business Acquisitions By Acquisition | The Company made the following updates to the purchase price during the nine months ended September 30, 2016: Allocated to: Goodwill $ 1,749 Legacy payments (1,749) $ - |
Schedule Of Purchase Price Allocation | The Company also made the following measurement period reclassifications during the nine months ended September 30, 2016 in connection with completing the valuation of the MSLO acquisition: Allocated to: Prepaid expenses and other current assets $ 826 Property and equipment 1,717 Goodwill (12,998) Trademarks 16,398 Customer agreements (8) Accounts payable and accrued expenses (40) Deferred tax liability (5,895) $ - |
Business Acquisition, Pro Forma Information | Since stand-alone financial information prior to the acquisition was not readily available, compilation of such data is impracticable. Three Months Ended Nine Months Ended September 30, 2016 September 30, 2016 (in thousands, except share and per share data) Revenues $ 42,584 $ 110,746 Income (loss) from continuing operations $ 23,199 $ (16,867) Net loss attributable to Sequential Brands Group, Inc. and Subsidiaries $ (1,232) $ (30,941) Loss per share: Basic $ (0.02) $ (0.50) Diluted $ (0.02) $ (0.50) Weighted average shares outstanding: Basic 62,176,700 61,817,742 Diluted 62,176,700 61,817,742 |
Martha Stewart Living Omnimedia, Inc. [Member] | |
Schedule Of Purchase Price Allocation | The allocation of the purchase price is summarized as follows (in thousands): Cash paid $ 176,722 Fair value of common stock issued (20,014,726 shares) 185,937 Total consideration $ 362,659 Allocated to: Cash $ 39,095 Accounts receivable 17,524 Prepaid expenses and other current assets 1,524 Property and equipment 5,376 Other non-current assets 958 Goodwill 128,713 Trademarks 329,770 Customer agreements 632 Accounts payable and accrued expenses (11,158) Guaranteed contractual payments (12,826) Payments to seller (3,250) Consideration paid to MSLO employees/directors for stock awards (14,227) Legacy payments (1,749) Long-term liabilities (452) Other deferred revenue (1,717) Deferred tax liability (115,554) $ 362,659 |
Gaiam Brand Holdco, LLC [Member] | |
Schedule Of Purchase Price Allocation | Total consideration paid $ 147,587 Allocated to: Goodwill $ 2,087 Trademarks 145,700 Accrued expenses (200) $ 147,587 |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Changes in the restructuring accruals during the nine months ended September 30, 2016 were as follows: Severance & Related Contract Termination Benefits Costs Professional Fees Total Accrual (in thousands) Balance at January 1, 2016 $ 4,644 $ 1,628 $ 579 $ 6,851 Charges to expense 1,687 342 755 2,784 Amounts paid (6,231) (445) (1,334) (8,010) Balance at September 30, 2016 $ 100 $ 1,525 $ - $ 1,625 |
Summary of Significant Accoun31
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Significant Accounting Policies [Line Items] | |||||
Allowance for doubtful accounts receivable | $ 400 | $ 400 | $ 300 | ||
Accounts Receivable, Net, Current, Total | 44,205 | 44,205 | 42,026 | ||
Revenue, Net, Total | 41,952 | $ 22,981 | 110,114 | $ 56,833 | |
Prior Period Reclassification Adjustment | 7,900 | ||||
Net Cash Provided by (Used in) Operating Activities, Total | 31,397 | 14,413 | |||
Net Cash Provided by (Used in) Financing Activities | 98,021 | 194,906 | |||
Restatement Adjustment [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Net Cash Provided by (Used in) Operating Activities, Total | 1,300 | ||||
Net Cash Provided by (Used in) Financing Activities | $ 1,300 | ||||
Long Term Liabilities [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Unrecognized tax benefits | $ 600 | $ 600 | $ 600 | ||
Accounts Receivable [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk, Percentage | 25.00% | 26.00% | |||
Accounts Receivable [Member] | License One [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk, Percentage | 14.00% | 15.00% | |||
Accounts Receivable [Member] | License Two [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk, Percentage | 11.00% | 11.00% | |||
Sales Revenue, Services, Net [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk, Percentage | 10.00% | 10.00% | 10.00% | ||
Sales Revenue, Services, Net [Member] | License One [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk, Percentage | 16.00% | 10.00% | 19.00% | ||
Sales Revenue, Services, Net [Member] | License Two [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration Risk, Percentage | 15.00% | 16.00% |
Unrealized Gains And Losses On
Unrealized Gains And Losses On Available-For-Sale Securities Held (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Historical Cost | $ 12,048 | $ 12,048 |
Estimated Fair Value | 6,671 | 5,611 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | $ 5,377 | $ 6,437 |
Basic and Diluted Weighted Aver
Basic and Diluted Weighted Average Common Shares Outstanding (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Basic weighted-average common shares outstanding | 62,176,700 | 39,781,868 | 61,817,742 | 39,384,090 |
Acquisition hold back shares | 0 | 1,375,000 | 230,840 | 1,375,000 |
Warrants | 360,440 | 565,239 | 351,386 | 528,837 |
Stock options | 18,252 | 37,798 | 15,406 | 108,587 |
Performance stock awards | 407,355 | 139,889 | 408,152 | 47,142 |
Unvested restricted stock | 104,010 | 206,262 | 95,064 | 195,479 |
Diluted weighted-average common shares outstanding | 63,066,757 | 42,106,056 | 62,918,590 | 41,639,135 |
Computation of Diluted EPS (Det
Computation of Diluted EPS (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Common stock, value, outstanding | 376,000 | 20,000 | 506,000 | 30,000 |
Warrants | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Common stock, value, outstanding | 325,000 | 0 | 325,000 | 0 |
Unvested restricted stock | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Common stock, value, outstanding | 0 | 0 | 130,000 | 0 |
Stock options | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Common stock, value, outstanding | 51,000 | 20,000 | 51,000 | 30,000 |
Noncontrolling Interest From Co
Noncontrolling Interest From Continuing Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Noncontrolling Interest [Line Items] | ||||
Net income attributable to noncontrolling interest | $ 2,022 | $ 1,623 | $ 5,814 | $ 3,617 |
With You LLC [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Net income attributable to noncontrolling interest | 1,757 | 1,470 | 5,025 | 3,163 |
DVS LLC [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Net income attributable to noncontrolling interest | 140 | 153 | 423 | 454 |
FUL IP [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Net income attributable to noncontrolling interest | $ 125 | $ 0 | $ 366 | $ 0 |
Fair Value Measurement of Fin36
Fair Value Measurement of Financial Instruments -Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | |
Fair Value Of Legacy Payments | $ 1,700 | $ 1,700 | |
Swap [Member] | |||
Derivative, Notional Amount | 19,000 | 19,000 | $ 19,000 |
Interest Expense [Member] | |||
Accretion Expense | $ 100 | $ 200 |
Fair Value Assets and Liabiliti
Fair Value Assets and Liabilities Measured on Recurring Basis (Detail) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | $ 6,671,000 | $ 5,611,000 |
Long-term debt, Carrying Value | 622,946,000 | 523,065,000 |
Financial Instrument | 2016 Term Loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, Carrying Value | 587,500,000 | 0 |
Long-term debt, Fair Value | 554,132,000 | 0 |
Financial Instrument | 2015 Term Loans | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, Carrying Value | 0 | 464,000,000 |
Long-term debt, Fair Value | 0 | 446,320,000 |
Financial Instrument | 2016 Revolving Loan | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, Carrying Value | 80,500,000 | 0 |
Long-term debt, Fair Value | 59,812,000 | 0 |
Financial Instrument | 2015 Revolving Loan | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, Carrying Value | 0 | 86,000,000 |
Long-term debt, Fair Value | 0 | 62,880,000 |
Financial Instrument | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 6,671,000 | 5,611,000 |
Interest rate swap | 11,000 | 29,000 |
LNT Contingent Earn outs | 0 | 0 |
Legacy Payments | 1,936 | 0 |
Financial Instrument | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 6,671,000 | 5,611,000 |
Interest rate swap | 11,000 | 29,000 |
LNT Contingent Earn outs | 0 | 0 |
Legacy Payments | $ 1,936 | $ 0 |
Components of the Swap Agreemen
Components of the Swap Agreement (Detail) - Swap [Member] - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Derivatives, Fair Value [Line Items] | ||
Notional Value | $ 19,000 | $ 19,000 |
Derivative Asset | 0 | |
Derivative Liability | $ 11 |
Components of Discontinued Oper
Components of Discontinued Operations of Wholesales Business, Balance Sheet (Detail) - Discontinued Operations, Wholesale Business Segment - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Prepaid expenses and other current assets | $ 83 | $ 113 |
Long-term liabilities | $ 639 | $ 677 |
Summary of Goodwill (Detail)
Summary of Goodwill (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Schedule Of Goodwill [Line Items] | |
Beginning Balance | $ 314,288 |
Ending Balance | 305,126 |
Acquisition of Martha Stewart Living Omnimedia, Inc. [Member] | |
Schedule Of Goodwill [Line Items] | |
Acquisitions | (11,249) |
Acquisition of Gaiam, Inc. Branded Consumer Business [Member] | |
Schedule Of Goodwill [Line Items] | |
Acquisitions | $ 2,087 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Feb. 24, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Intangible Assets Disclosure [Line Items] | ||||||
Amortization expense | $ 300 | $ 300 | $ 1,000 | $ 800 | ||
Proceeds from Divestiture of Businesses | $ 700 | |||||
Earn Out Receivable | 1,000 | |||||
Minimum Gross Sales Required | 30,000 | $ 30,000 | ||||
Gain (Loss) on Disposition of Intangible Assets | $ 700 | $ 0 | $ 700 |
Summary of Intangible Assets (D
Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Schedule Of Finite Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, Gross Carrying Amount | $ 8,982 | $ 8,924 |
Finite-lived intangible asset, Accumulated Amortization | (3,746) | (2,731) |
Finite-lived intangible asset, Net Carrying Amount | 5,236 | 6,193 |
Intangible assets, net | $ 1,033,742 | $ 872,277 |
Trademarks | ||
Schedule Of Finite Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, Useful Lives | 15 years | 15 years |
Finite-lived intangible asset, Gross Carrying Amount | $ 4,971 | $ 4,905 |
Finite-lived intangible asset, Accumulated Amortization | (1,475) | (1,228) |
Finite-lived intangible asset, Net Carrying Amount | 3,496 | 3,677 |
Indefinite lived intangible assets | $ 1,028,506 | $ 866,084 |
Customer agreements | ||
Schedule Of Finite Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, Useful Lives | 4 years | 4 years |
Finite-lived intangible asset, Gross Carrying Amount | $ 2,809 | $ 2,817 |
Finite-lived intangible asset, Accumulated Amortization | (1,559) | (1,017) |
Finite-lived intangible asset, Net Carrying Amount | $ 1,250 | $ 1,800 |
Favorable lease | ||
Schedule Of Finite Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, Useful Lives | 2 years | 2 years |
Finite-lived intangible asset, Gross Carrying Amount | $ 537 | $ 537 |
Finite-lived intangible asset, Accumulated Amortization | (498) | (322) |
Finite-lived intangible asset, Net Carrying Amount | $ 39 | $ 215 |
Patents | ||
Schedule Of Finite Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, Useful Lives | 10 years | 10 years |
Finite-lived intangible asset, Gross Carrying Amount | $ 665 | $ 665 |
Finite-lived intangible asset, Accumulated Amortization | (214) | (164) |
Finite-lived intangible asset, Net Carrying Amount | $ 451 | $ 501 |
Future Annual Estimated Amortiz
Future Annual Estimated Amortization Expense (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Future Annual Estimated Amortization Expense [Line Items] | ||
Remainder of 2016 | $ 314 | |
2,017 | 907 | |
2,018 | 775 | |
2,019 | 587 | |
2,020 | 398 | |
Thereafter | 2,255 | |
Total | $ 5,236 | $ 6,193 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2016 | Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Long-term Debt | $ 622,946 | $ 622,946 | $ 523,065 | ||
Proceeds from Issuance of Long-term Debt | 132,000 | $ 205,679 | |||
December 2015 Debt facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt instrument, Face amount | 368,000 | $ 368,000 | |||
Line of Credit Facility, Interest Rate Description | (i) LIBOR rate plus an applicable margin ranging from 8.00% to 8.75% per annum or (ii) the base rate plus an applicable margin ranging from 7.00% to 7.75% per annum | ||||
BoA Credit Agreement [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Repayments of Debt | $ 5,000 | ||||
Debt Instrument, Term | 5 years | ||||
BoA Credit Agreement [Member] | July 2016 Debt Facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt Instrument, Covenant Description | (i) maintain a positive net income, (ii) satisfy a maximum loan to value ratio set at 50.0% (applicable to the Revolving Loans and Tranche A Loans) and (iii) satisfy a maximum consolidated first lien leverage ratio, initially set at 2.80:1.00, decreasing over the term of the Amended BoA Credit Agreement until reaching the final maximum ratio of 2.50:1.00 for the fiscal quarter ending September 30, 2018 and thereafter. | ||||
Long-term Debt | $ 258,000 | ||||
Debt Instrument, Description | amounting to: (i) the loans outstanding under the Amended BoA Credit Agreement plus, (a) where intellectual property is disposed, 50.0% of the disposed intellectual propertys orderly liquidation value, and (b) where any other assets constituting collateral are disposed or upon the receipt of certain insurance proceeds, 100% of the net proceeds thereof, subject to certain reinvestment rights; and (ii) the Tranche A-1 Loans to the extent that the outstanding principal amount thereof exceeds 10.0% of the orderly liquidation value of the registered trademarks owned by the BoA Facility Loan Parties. | ||||
Proceeds from Issuance of Long-term Debt | $ 287,500 | ||||
GSO Term Loan Agreement [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Legal Fees | 13,000 | 13,000 | |||
Deferred Finance Costs, Net | 300 | $ 300 | |||
Debt Instrument, Covenant Compliance | (i) not exceed a maximum consolidated total leverage ratio initially set at 7.25:1.00, which decreases periodically over the term of the GSO Term Loan Agreement until the final maximum ratio of 6.75:1.00 is reached for the fiscal quarter ending September 30, 2019 and thereafter and (ii) not exceed a maximum consolidated first lien leverage ratio initially set at 2.47:1.00, which decreases periodically over the term of the GSO Term Loan Agreement until the final maximum ratio of 2.30:1.00 is reached for the fiscal quarter ending September 30, 2019 and thereafter. | ||||
Debt Instrument, Term | 6 years | ||||
Tranche A [Member] | BoA Credit Agreement [Member] | July 2016 Debt Facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt instrument, Face amount | $ 133,000 | ||||
Long-term Debt | 133,000 | ||||
Tranche A -1 Term Loans [Member] | BoA Credit Agreement [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt instrument, Face amount | 44,500 | ||||
Tranche A -1 Term Loans [Member] | BoA Credit Agreement [Member] | July 2016 Debt Facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Long-term Debt | $ 44,500 | ||||
Revolving Credit Facility [Member] | BoA Credit Agreement [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Line of Credit Facility, Commitment Fee Percentage | 0.375% | ||||
Revolving Credit Facility [Member] | BoA Credit Agreement [Member] | July 2016 Debt Facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Line of credit facility, Maximum borrowing capacity | $ 110,000 | ||||
Long-term Line of Credit | $ 80,500 | ||||
Revolving Credit Facility [Member] | Tranche A -1 Term Loans [Member] | BoA Credit Agreement [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt Instrument, Interest Rate, Basis for Effective Rate | (a) the LIBOR rate plus 7.00% per annum or (b) the base rate plus 6.00% per annum. | ||||
Second Lien Loan Agreement | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Line Of Credit Facility Prepayment, Description | mandatory prepayments of loans outstanding under the Facility (without payment of a premium or penalty) (i) in the case of any disposition of intellectual property, the then applicable LTV Percentage (as defined in the BoA Credit Agreement) of the orderly liquidation value thereof, (ii) in the case of any other disposition of any other assets, 100% of the net proceeds thereof, subject to certain reinvestment rights, and (iii) in the case of any Consolidated Excess Cash Flow (as defined in the GSO Term Loan Agreement), 50% thereof, which shall decrease to 0% if the consolidated total leverage ratio is less than 3.00:1.00. The loans under the Facility were not subject to amortization. | ||||
Second Lien Loan Agreement | December 2015 Debt facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Long-term Debt | 215,500 | $ 215,500 | |||
Trache A Term Loan [Member] | Revolving Credit Facility [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Line of Credit Facility, Covenant Terms | (i) the Revolving Credit Facility and Tranche A Loans as would not cause the consolidated first lien leverage ratio, determined on a pro forma basis after giving effect to any such increase, to exceed 2.33:1.00 and (ii) the Tranche A-1 Loans, as would not cause the consolidated first lien leverage ratio, determined on a pro forma basis after giving effect to any such increase, to exceed (a) with respect to any increase, the proceeds of which will be used solely to finance an acquisition, 2.50:100 and (b) with respect to any other increase, 2.40:1.00, subject to the satisfaction of certain conditions in the Amended BoA Credit Agreement. At September 30, 2016, the Company is in compliance with the covenants included in the Amended BoA Credit Agreement. | ||||
Trache A Term Loan [Member] | Revolving Credit Facility [Member] | BoA Credit Agreement [Member] | July 2016 Debt Facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt Instrument, Interest Rate, Basis for Effective Rate | (a) the LIBOR rate plus 3.50% per annum or (b) the base rate plus 2.50% per annum | ||||
New Secured Term Loan [Member] | December 2015 Debt facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Debt Instrument, Covenant Description | The Amendment had an effective date of December 4, 2015, and amended certain provisions under the BoA Credit Agreement to, among other things, (i) permit the consummation of the Mergers, (ii) permit, subject to the satisfaction of certain conditions, the increase in the aggregate revolving commitments and term loans under the BoA Credit Agreement by such amounts as would not cause the consolidated first lien leverage ratio, determined on a pro forma basis after giving effect to any such increase, to exceed 2.00:1.00, (iii) permit the inclusion of not less than (a) $30.0 million of EBITDA representing EBITDA generation by MSLO, (b) $8.0 million of EBITDA representing EBITDA generation by Joes Holdings and (c) fees and expenses incurred and associated with the Mergers and the acquisition of Joes Holdings in certain provisions that relate to calculation of the consolidated first lien leverage ratio, (iv) permit the incurrence of indebtedness under the GSO Term Loan Agreement (defined below) and (v) designated the Company as the borrower under the BoA Credit Agreement. | ||||
Long-term Debt | $ 152,500 | $ 152,500 | |||
GSO Credit Agreement [Member] | July 2016 Debt Facilities [Member] | |||||
Disclosure Long Term Debt Additional Information [Line Items] | |||||
Line of credit facility, Maximum borrowing capacity | $ 415,000 | ||||
Line of Credit Facility, Interest Rate Description | (i) the LIBOR rate plus an applicable margin of 8.25% or 9.00% per annum or (ii) the base rate plus an applicable margin of 7.25% or 8.00% per annum, | ||||
Debt Instrument, Covenant Description | (a) in the event the consolidated total leverage ratio is at least 4.00:1.00, 75% thereof, (b) in the event the consolidated total leverage ratio is less than 4.00:1.00 but at least 3.00:1.00, 50% thereof and (c) in the event the consolidated total leverage ratio is less than 3.00:1.00, 0% thereof. Commencing on March 31, 2017, the Loans under the Amended GSO Credit Agreement will amortize in quarterly installments, equal to 2.00% per annum of the original aggregate principal amount thereof. | ||||
Line of Credit Facility, Covenant Terms | The Company may request one or more additional term loan facilities or the increase of term loan commitments under the Amended GSO Credit Agreement as would not cause the consolidated total leverage ratio, determined on a pro forma basis after giving effect to any such addition and increase, to exceed 6.00:1.00, subject to the satisfaction of certain conditions in the Amended GSO Credit Agreement. | ||||
Debt Instrument Prepayment Terms | (i) where intellectual property is disposed, 50.0% of the disposed intellectual propertys orderly liquidation value, (ii) where any other asset constituting collateral is disposed or upon the receipt of certain insurance proceeds, 100% of the net proceeds thereof, subject to certain reinvestment rights, and (iii) any consolidated excess cash flow, in an amount equal to | ||||
Debt Instrument, Covenant Compliance | (i) a maximum consolidated total leverage ratio, initially set at 7.25:1.00, decreasing over the term of the Amended GSO Credit Agreement until reaching the final maximum ratio of 6.50:1.00 for the fiscal quarter ending September 30, 2018 and thereafter and (ii) a maximum consolidated first lien leverage ratio, initially set at 2.80:1.00, decreasing over the term of the Amended GSO Credit Agreement until reaching the final maximum ratio of 2.50:1.00 for the fiscal quarter ending September 30, 2018 and thereafter. |
Components of Long-Term Debt (D
Components of Long-Term Debt (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Schedule Of Long Term Debt [Line Items] | ||
Secured Term Loans | $ 587,500 | $ 464,000 |
Revolving Credit Facility | 80,500 | 86,000 |
Unamortized deferred financing costs | (18,829) | (7,935) |
Total long-term debt, net of unamortized deferred financing costs | 649,171 | 542,065 |
Less: current portion of long-term debt | 26,225 | 19,000 |
Long-term debt | $ 622,946 | $ 523,065 |
New Secured Term Loan Agreement
New Secured Term Loan Agreement (Detail) - New Secured Term Loan Agreement [Member] | 9 Months Ended |
Sep. 30, 2016 | |
Leverage Ratio One [Member] | |
New Secured Term Loan Agreement [Line Items] | |
Consolidated Total Leverage Ratio | > 6.00 : 1.00 |
Consolidated Net Leverage Ratio | ≥ 5.75 : 1.00 |
Percentage for Margin London Interbank Offered Rate | 8.75% |
Leverage Ratio Two [Member] | |
New Secured Term Loan Agreement [Line Items] | |
Consolidated Total Leverage Ratio | ≥ 4.75 : 1.00 ≤ 6.00 : 1.00 |
Consolidated Net Leverage Ratio | ≥ 4.50 : 1.00 < 5.75 : 1.00 |
Percentage for Margin London Interbank Offered Rate | 8.25% |
Leverage Ratio Three [Member] | |
New Secured Term Loan Agreement [Line Items] | |
Consolidated Total Leverage Ratio | < 4.75 : 1.00 |
Consolidated Net Leverage Ratio | < 4.50 : 1.00 |
Percentage for Margin London Interbank Offered Rate | 8.00% |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Feb. 23, 2016 | Feb. 24, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total unrecognized compensation expense | $ 0.2 | $ 0.4 | $ 0.7 | $ 0.6 | ||
Chief Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 100,000 | |||||
Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted shares granted | 175,000 | 175,000 | ||||
Restricted stock awards, granted in period | 15,000 | |||||
Board Of Directors | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 70,548 | 24,452 | ||||
Fair value of restricted stock grant | $ 0.7 | |||||
Non Employee [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 150,150 | |||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 35,000 | |||||
Granted, Number of Options | 280,548 | |||||
Total unrecognized compensation expense | $ 0.8 | 0.9 | $ 1.8 | $ 2.2 | ||
Total compensation expense | $ 0.1 | 0.1 | ||||
Fair value of restricted stock grant | $ 1.2 | 3.8 | ||||
Restricted Stock | Restructuring Charges [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 32,500 | 32,500 | ||||
Total compensation expense | $ 0.5 | $ 0.5 | ||||
Fair value of restricted stock grant | $ 0.2 | $ 0.2 | ||||
Performance Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 69,994 | 198,000 | 108,500 | 108,500 | ||
Total compensation expense | $ 1.3 | 0.5 | $ 3.6 | 3.1 | ||
Share Based Compensation Arrangement By Share Based Payment Award Options Vested Value | $ 0.2 | $ 2.9 | ||||
Performance Stock Units | Chief Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 20,000 | 60,000 | ||||
Granted, Number of Options | 200,000 | |||||
Performance Stock Units | Chief Financial Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 12,000 | 36,000 | ||||
Total unrecognized compensation expense | $ 0.4 | $ 2 | ||||
Performance Stock Units | Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 12,500 | |||||
Granted, Number of Options | 30,000 | |||||
Total unrecognized compensation expense | 0.1 | $ 0.1 | ||||
Compensation Expense | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total unrecognized compensation expense | 0.1 | $ 0.2 | ||||
Warrants | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted stock awards, granted in period | 0 | |||||
Share-based compensation arrangement by share-based payment award, options, vested in period, fair value | $ 1.3 | |||||
Total unrecognized compensation expense | $ 0.1 | 0.2 | $ 0.2 | 0.3 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 200,000 | 200,000 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 13.32 | $ 13.32 | ||||
Total compensation expense | $ 0.1 | 0.2 | $ 0.2 | 0.3 | ||
Term Of Class Of Warrants Or Rights | 10 years | |||||
Employee Stock Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock option expense, Recognition period | 4 months 24 days | |||||
Total unrecognized compensation expense | $ 0.1 | $ 0.1 | ||||
Total compensation expense | $ 0.1 | |||||
Employee Stock Option [Member] | Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted, Number of Options | 10,000 | 10,000 | ||||
Total unrecognized compensation expense | $ 0.1 | |||||
Employee Stock Option [Member] | Compensation Expense | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total unrecognized compensation expense | $ 0.1 | $ 3.6 |
Summary of Stock Option Activit
Summary of Stock Option Activity and Changes in Unvested Stock Options (Detail) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Changes in nonvested stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding, Number of Options | 21,000 | |
Granted, Number of Options | 0 | |
Vested, Number of Options | (16,000) | |
Forfeited or Canceled, Number of Options | 0 | |
Outstanding, Number of Options | 5,000 | 21,000 |
Outstanding, Weighted Average Exercise Price | $ 2.71 | |
Granted, Weighted Average Exercise Price | 0 | |
Vested, Weighted Average Exercise Price | (2.94) | |
Forfeited or Canceled, Weighted Average Exercise Price | 0 | |
Outstanding, Weighted Average Exercise Price | $ 1.96 | $ 2.71 |
Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding, Number of Options | 129,501 | |
Granted, Number of Options | 0 | |
Exercised, Number of Options | 0 | |
Forfeited or Canceled, Number of Options | 0 | |
Outstanding, Number of Options | 129,501 | 129,501 |
Exercisable, Number of Options | 124,501 | |
Outstanding, Weighted Average Exercise Price | $ 9.65 | |
Granted, Weighted Average Exercise Price | 0 | |
Exercised, Weighted Average Exercise Price | 0 | |
Forfeited or Canceled, Weighted Average Exercise Price | 0 | |
Outstanding, Weighted Average Exercise Price | 9.65 | $ 9.65 |
Exercisable, Weighted Average Exercise Price | $ 9.77 | |
Weighted Average Remaining Contractual Life (in years) | 2 years 8 months 12 days | 3 years 3 months 18 days |
Exercisable, Weighted Average Remaining Contractual Life (in years) | 2 years 8 months 12 days | |
Outstanding, Aggregate Intrinsic Value | $ 153 | $ 148 |
Exercisable, Aggregate Intrinsic Value | $ 147 |
Summary of Black-Scholes Option
Summary of Black-Scholes Option-Pricing Model Assumptions in Unvested Stock Options And Warrants (Detail) | 9 Months Ended |
Sep. 30, 2016 | |
Employees Stock Options | |
Summary of Black-Scholes Option-Pricing Model Assumptions in Unvested Stock Options And Warrants [Line Items] | |
Risk-free interest rate | 0.90% |
Expected dividend yield | 0.00% |
Expected volatility | 32.10% |
Expected life | 3 years |
Warrants | |
Summary of Black-Scholes Option-Pricing Model Assumptions in Unvested Stock Options And Warrants [Line Items] | |
Risk-free interest rate | 2.16% |
Expected dividend yield | 0.00% |
Expected volatility | 45.84% |
Expected life | 7 years 3 months |
Summary of Company's Outstandin
Summary of Company's Outstanding Warrant and Changes in Unvested Warrants (Detail) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | |
Changes In Unvested Warrants | ||
Summary Of Company Outstanding Warrant and Changes In Unvested Warrants [Line Items] | ||
Outstanding, Number of Warrants | shares | 150,000 | |
Granted, Number of Warrants | shares | 0 | |
Vested, Number of Warrants | shares | (75,000) | |
Forfeited or Canceled, Number of Warrants | shares | 0 | |
Outstanding, Number of Warrants | shares | 75,000 | 150,000 |
Outstanding, Weighted Average Exercise Price | $ / shares | $ 6.32 | |
Granted, Weighted Average Exercise Price | $ / shares | 0 | |
Vested, Weighted Average Grant Date Fair Value | $ / shares | 6.32 | |
Forfeited or Canceled, Weighted Average Exercise Price | $ / shares | 0 | |
Outstanding, Weighted Average Exercise Price | $ / shares | $ 6.32 | $ 6.32 |
Warrants | ||
Summary Of Company Outstanding Warrant and Changes In Unvested Warrants [Line Items] | ||
Outstanding, Number of Warrants | shares | 801,760 | |
Granted, Number of Warrants | shares | 0 | |
Exercised, Number of Warrants | shares | 0 | |
Forfeited or Canceled, Number of Warrants | shares | 0 | |
Outstanding, Number of Warrants | shares | 801,760 | 801,760 |
Exercisable, Number of Warrants | shares | 726,760 | |
Outstanding, Weighted Average Exercise Price | $ / shares | $ 7.87 | |
Granted, Weighted Average Exercise Price | $ / shares | 0 | |
Exercised, Weighted Average Exercise Price | $ / shares | 0 | |
Forfeited or Canceled, Weighted Average Exercise Price | $ / shares | 0 | |
Outstanding, Weighted Average Exercise Price | $ / shares | 7.87 | $ 7.87 |
Exercisable, Weighted Average Exercise Price | $ / shares | $ 7.31 | |
Outstanding, Weighted Average Remaining Contractual Life (in Years) | 3 years 3 months 18 days | 4 years 1 month 6 days |
Exercisable, Weighted Average Remaining Contractual Life (in Years) | 2 years 9 months 18 days | |
Outstanding, Aggregate Intrinsic Value | $ | $ 1,420 | $ 1,377 |
Exercisable, Aggregate Intrinsic Value | $ | $ 1,420 |
Summary of Restricted Stock Act
Summary of Restricted Stock Activity and Performance Stock Units (Detail) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Restricted Stock | ||
Summary Of Restricted Stock Activity [Line Items] | ||
Outstanding, Number of Options | 510,653 | |
Granted, Number of Options | 280,548 | |
Vested, Number of Options | (187,985) | |
Outstanding, Number of Options | 603,216 | 510,653 |
Weighted Average Grant Date Fair Value | $ 9.89 | |
Granted, Weighted Average Grant Date Fair Value | 6.58 | |
Vested, Weighted Average Grant Date Fair Value | 7.29 | |
Weighted Average Grant Date Fair Value | $ 9.16 | $ 9.89 |
Unvested, Weighted Average Remaining Contractual Life (in years) | 1 year 10 months 24 days | 2 years |
Outstanding, Aggregate Intrinsic Value | $ 510 | |
Outstanding, Aggregate Intrinsic Value | $ 589 | $ 510 |
Performance Stock Units (PSUs) | ||
Summary Of Restricted Stock Activity [Line Items] | ||
Outstanding, Number of Options | 1,308,500 | |
Granted, Number of Options | 30,000 | |
Vested, Number of Options | (317,833) | |
Forfeited or Cancelled, Number of Options | (39,300) | |
Outstanding, Number of Options | 981,367 | 1,308,500 |
Weighted Average Grant Date Fair Value | $ 10.98 | |
Granted, Weighted Average Grant Date Fair Value | 7.23 | |
Vested, Weighted Average Grant Date Fair Value | (9.58) | |
Forfeited or Cancelled, Weighted Average Grant Date Fair Value | (5.74) | |
Weighted Average Grant Date Fair Value | $ 11.53 | $ 10.98 |
Unvested, Weighted Average Remaining Contractual Life (in years) | 8 months 12 days | 1 year 4 months 24 days |
Outstanding, Aggregate Intrinsic Value | $ 96 | |
Outstanding, Aggregate Intrinsic Value | $ 23 | $ 96 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | Dec. 04, 2015 | Jan. 01, 2013 | Nov. 17, 2014 | Jul. 30, 2013 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Aug. 15, 2014 |
Related Party [Line Items] | ||||||||||||
Intangible Asset Agreement Annual Payment | $ 1.7 | $ 1.7 | ||||||||||
License Agreement Annual Payment | 1.3 | 1.3 | ||||||||||
License Agreement Payments During Period | 0.1 | |||||||||||
Tengram Capital Partners Gen2 Fund Lp | ||||||||||||
Related Party [Line Items] | ||||||||||||
Percentage of beneficially owned of outstanding common stock | 5.00% | |||||||||||
FUL | ||||||||||||
Related Party [Line Items] | ||||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | $ 8.9 | |||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 50.50% | |||||||||||
Income (Loss) Attributable to Noncontrolling Interest | 0.1 | 0.4 | ||||||||||
ES Originals Inc | ||||||||||||
Related Party [Line Items] | ||||||||||||
Royalty Revenue | $ 4.5 | 3 | $ 3.4 | 11.2 | $ 10.5 | |||||||
Accrued Royalties | 4.8 | $ 4.8 | $ 4.1 | |||||||||
TCM Employee | ||||||||||||
Related Party [Line Items] | ||||||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Grants In Period, Gross | 125,000 | |||||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Equity Instruments Other Than Options, Grants In Period | 180,000 | |||||||||||
TCP Employee | Vesting Over Three Years [Member] | ||||||||||||
Related Party [Line Items] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 20.00% | 20.00% | ||||||||||
TCP Employee | Scenario, Forecast [Member] | Vesting Over Three Years [Member] | ||||||||||||
Related Party [Line Items] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 60.00% | |||||||||||
IP License Agreement And Intangible Asset Agreement [Member] | ||||||||||||
Related Party [Line Items] | ||||||||||||
Terms Of Agreement | calendar years 2018 through 2020 exceed $195 million or the gross licensing revenues for calendar year 2020 equal or exceed $65 million. | |||||||||||
Accretion Expense | 0.2 | $ 0.6 | ||||||||||
License Agreement Payments During Period | 0.3 | 1 | ||||||||||
Registration Rights Agreement [Member] | ||||||||||||
Related Party [Line Items] | ||||||||||||
Terms Of Agreement | up to two offerings of greater than $15 million each, certain S-3 registration rights for up to three offerings of greater than $5 million each | |||||||||||
TCP Agreement | ||||||||||||
Related Party [Line Items] | ||||||||||||
Cash Paid For Services | 0.9 | 0.5 | 0.9 | 0.9 | ||||||||
Receivables From Series Rendered For Merger And Acquisition | $ 1 | |||||||||||
License Agreement Annual Payment | $ 0.9 | |||||||||||
Acquisition of Transaction Fee | 12 | |||||||||||
Consulting Arrangement | TCP Agreement | ||||||||||||
Related Party [Line Items] | ||||||||||||
Professional Fees | $ 0.2 | $ 0.1 | $ 0.3 | $ 0.3 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) | Jul. 02, 2016 | Dec. 04, 2015 | Aug. 15, 2014 | Feb. 29, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 |
Disclosure Acquisitions Additional Information [Line Items] | |||||||||
Net revenue | $ 41,952,000 | $ 22,981,000 | $ 110,114,000 | $ 56,833,000 | |||||
Business Acquisition Agreement Term Description | 18 months | ||||||||
Stock Issued During Period, Value, Acquisitions | $ 0 | ||||||||
Business Combinations [Abstract] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 176,681,757 | ||||||||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | ||||||
Business Combination, Contingent Consideration Arrangements, Description | Beginning with calendar years commencing on or after January 1, 2026, the Company will pay Ms. Stewart three and one-half percent (3.5%) of Gross Licensing Revenues (as defined in Ms. Stewarts employment agreement) for each such calendar year for the remainder of Ms. Stewarts life (with a minimum of five (5) years of payments, to be made to Ms. Stewarts estate if Ms. Stewart dies before December 31, 2030) | ||||||||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 176,681,757 | ||||||||
Galaxy Brand Holdings Acquisition [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 1,375,000 | ||||||||
Martha Stewart Living Omnimedia [Member] | |||||||||
Disclosure Acquisitions Additional Information [Line Items] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 40,436,798 | ||||||||
Stock Issued During Period, Value, Acquisitions | $ 40,314 | ||||||||
Business Acquisition, Share Price | $ 8.8393 | ||||||||
Business Combinations [Abstract] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 19,980,787 | ||||||||
Common Stock Conversion Price | $ 6.15 | ||||||||
Business Combination, Consideration Transferred, Total | $ 176,681,757 | ||||||||
Business Acquisition, Legacy Payments | $ 1,700,000 | ||||||||
Martha Stewart Living Omnimedia [Member] | Chief Executive Officer [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 33,939 | ||||||||
Martha Stewart Living Omnimedia [Member] | Employees [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Business Combination, Consideration Transferred, Total | $ 14,200,000 | ||||||||
Martha Stewart Living Omnimedia [Member] | Common Class A [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.01 | ||||||||
Martha Stewart Living Omnimedia [Member] | Common Class B [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.01 | ||||||||
Gaiam Brand Holdco, LLC [Member] | |||||||||
Disclosure Acquisitions Additional Information [Line Items] | |||||||||
Net revenue | $ 6,000,000 | $ 6,000,000 | |||||||
Income (Loss) from continuing operations | $ 5,800,000 | 5,800,000 | |||||||
Business Combinations [Abstract] | |||||||||
Business Combination, Consideration Transferred, Total | 147,587,000 | ||||||||
Business Combination Aggregate Purchase Price In Cash | $ 145,700,000 | ||||||||
Gaiam Brand Holdco, LLC [Member] | Operating Expense [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Business Combination, Acquisition Related Costs | $ 3,800,000 | ||||||||
Gaiam Brand Holdco, LLC [Member] | Employee Severance [Member] | |||||||||
Business Combinations [Abstract] | |||||||||
Business Combination, Acquisition Related Costs | $ 1,900,000 |
Acquisitions (Purchase Price) (
Acquisitions (Purchase Price) (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Goodwill | $ 305,126 | $ 314,288 |
Martha Stewart Living Omnimedia, Inc [Member] | ||
Goodwill | 1,749 | |
Legacy payments | $ (1,749) |
Acquisitions (Measurement Perio
Acquisitions (Measurement Period Reclassifications) (Detail) - Martha Stewart Living Omnimedia, Inc [Member] $ in Thousands | Sep. 30, 2016USD ($) |
Allocated to: | |
Prepaid expenses and other current assets | $ 826 |
Property and equipment | 1,717 |
Goodwill | (12,998) |
Trademarks | 16,398 |
Customer agreements | (8) |
Accounts payable and accrued expenses | (40) |
Deferred tax liability | (5,895) |
Total consideration paid | $ 0 |
Acquisitions (Allocation of The
Acquisitions (Allocation of The Purchase Price (Detail) - USD ($) | Dec. 04, 2015 | Sep. 30, 2016 | Dec. 31, 2015 |
Summary Of Purchase Price Allocation [Line Items] | |||
Fair value of common stock issued (20,014,726 shares) | $ 176,681,757 | ||
Goodwill | $ 305,126,000 | $ 314,288,000 | |
Acquisition of Martha Stewart Living Omnimedia [Member] | |||
Summary Of Purchase Price Allocation [Line Items] | |||
Cash paid | 176,722,000 | ||
Fair value of common stock issued (20,014,726 shares) | 185,937,000 | ||
Total consideration | 362,659,000 | ||
Cash | 39,095,000 | ||
Accounts receivable | 17,524,000 | ||
Prepaid expenses and other current assets | 1,524,000 | ||
Property and equipment | 5,376,000 | ||
Other non-current assets | 958,000 | ||
Goodwill | 128,713,000 | ||
Trademarks | 329,770,000 | ||
Customer agreements | 632,000 | ||
Accounts payable and accrued expenses | (11,158,000) | ||
Guaranteed contractual payments | (12,826,000) | ||
Legacy payments | (1,749,000) | ||
Long-term liabilities | (452,000) | ||
Other deferred revenue | (1,717,000) | ||
Deferred tax liability | (115,554,000) | ||
Total Consideration Paid | 362,659,000 | ||
EmployeesDirector [Member] | Acquisition of Martha Stewart Living Omnimedia [Member] | |||
Summary Of Purchase Price Allocation [Line Items] | |||
Noncontrolling interst member contribution | (14,227,000) | ||
Seller [Member] | Acquisition of Martha Stewart Living Omnimedia [Member] | |||
Summary Of Purchase Price Allocation [Line Items] | |||
Noncontrolling interst member contribution | $ (3,250,000) |
Acquisitions (Allocation of Pre
Acquisitions (Allocation of Preliminary Purchase Price) (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Summary Of Purchase Price Allocation [Line Items] | ||
Goodwill | $ 305,126 | $ 314,288 |
Gaiam Brand Holdco, LLC [Member] | ||
Summary Of Purchase Price Allocation [Line Items] | ||
Total consideration paid | 147,587 | |
Goodwill | 2,087 | |
Trademarks | 145,700 | |
Accrued expenses | $ (200) |
Acquisitions (Consolidated Pro
Acquisitions (Consolidated Pro Forma Information) (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Pro Forma Information [Line Items] | ||||
Revenues | $ 42,584 | $ 110,746 | ||
Income (loss) from continuing operations | 23,199 | (16,867) | ||
Net loss attributable to Sequential Brands Group, Inc. and Subsidiaries | $ (1,232) | $ (30,941) | ||
Loss per share: | ||||
Basic | $ (0.02) | $ (0.50) | ||
Diluted | $ (0.02) | $ (0.50) | ||
Weighted average shares outstanding: | ||||
Basic | 62,176,700 | 39,781,868 | 61,817,742 | 39,384,090 |
Diluted | 63,066,757 | 42,106,056 | 62,918,590 | 41,639,135 |
Restructuring - Additional Info
Restructuring - Additional Information (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2015USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges, Total | $ 400 | $ 3,200 | |
Restructuring Reserve, Current | $ 1,600 | 1,600 | $ 6,900 |
Payments for Restructuring | $ 8,900 | ||
Restructuring and Related Cost, Number of Positions Eliminated | 65 | ||
Other Restructuring Costs | $ 11,900 | ||
Professional Fees [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges, Total | 755 | ||
Payments for Restructuring | 1,334 | ||
Asset Write-Offs [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges, Total | 400 | ||
Employee Severance [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges, Total | 1,687 | ||
Payments for Restructuring | 6,231 | ||
Contract Termination [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges, Total | 342 | ||
Payments for Restructuring | $ 445 |
Restructuring - (Detail)
Restructuring - (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2016 | Sep. 30, 2016 | |
Reserves and allowance deducted from asset accounts: | ||
Charges to expense | $ 400 | $ 3,200 |
Amounts paid | (8,900) | |
Severance & Related Benefits [Member] | ||
Reserves and allowance deducted from asset accounts: | ||
Balance at January 1, 2016 | 4,644 | |
Charges to expense | 1,687 | |
Amounts paid | (6,231) | |
Balance at September 30, 2016 | 100 | 100 |
Contract Termination Costs [Member] | ||
Reserves and allowance deducted from asset accounts: | ||
Balance at January 1, 2016 | 1,628 | |
Charges to expense | 342 | |
Amounts paid | (445) | |
Balance at September 30, 2016 | 1,525 | 1,525 |
Professional Fees [Member] | ||
Reserves and allowance deducted from asset accounts: | ||
Balance at January 1, 2016 | 579 | |
Charges to expense | 755 | |
Amounts paid | (1,334) | |
Balance at September 30, 2016 | 0 | 0 |
Total Accrual [Member] | ||
Reserves and allowance deducted from asset accounts: | ||
Balance at January 1, 2016 | 6,851 | |
Charges to expense | 2,784 | |
Amounts paid | (8,010) | |
Balance at September 30, 2016 | $ 1,625 | $ 1,625 |