COVER PAGE
COVER PAGE - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 10, 2022 | Jun. 30, 2021 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38880 | ||
Entity Registrant Name | Whole Earth Brands, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 38-4101973 | ||
Entity Address, Address Line One | 125 S. Wacker Drive | ||
Entity Address, Address Line Two | Suite 3150 | ||
Entity Address, City or Town | Chicago | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60606 | ||
City Area Code | 312 | ||
Local Phone Number | 840-6000 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Public Float | $ 538,348,402 | ||
Entity Common Stock, Shares Outstanding | 41,531,623 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement relating to its annual meeting of stockholders to be held in 2022 (the “2022 Annual Meeting”), to be filed with the Securities and Exchange Commission (the “SEC”) within 120 days after the end of the fiscal year to which this Annual Report on Form 10-K relates, are incorporated herein by reference where indicated. Except with respect to information specifically incorporated by reference in this Annual Report on Form 10-K, such proxy statement is not deemed to be filed as part hereof. | ||
Entity Central Index Key | 0001753706 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2021 | ||
Common Stock | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Common stock, par value $0.0001 per share | ||
Trading Symbol | FREE | ||
Security Exchange Name | NASDAQ | ||
Warrant | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Warrants to purchase one-half of one share of common stock | ||
Trading Symbol | FREEW | ||
Security Exchange Name | NASDAQ |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | New York, NY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 28,296 | $ 16,898 |
Accounts receivable (net of allowances of $1,285 and $955, respectively) | 69,590 | 56,423 |
Inventories | 212,930 | 111,699 |
Prepaid expenses and other current assets | 7,585 | 5,045 |
Total current assets | 318,401 | 190,065 |
Property, Plant and Equipment, net | 58,503 | 47,285 |
Other Assets | ||
Operating lease right-of-use assets | 26,444 | 12,193 |
Goodwill | 242,661 | 153,537 |
Other intangible assets, net | 266,939 | 184,527 |
Deferred tax assets, net | 1,993 | 2,671 |
Other assets | 7,638 | 6,260 |
Total Assets | 922,579 | 596,538 |
Current Liabilities | ||
Accounts payable | 55,182 | 25,200 |
Accrued expenses and other current liabilities | 30,733 | 29,029 |
Contingent consideration payable | 54,113 | 0 |
Current portion of operating lease liabilities | 7,950 | 3,623 |
Current portion of long-term debt | 3,750 | 7,000 |
Total current liabilities | 151,728 | 64,852 |
Non-Current Liabilities | ||
Long-term debt | 383,484 | 172,662 |
Warrant liabilities | 2,053 | 0 |
Deferred tax liabilities, net | 35,090 | 23,297 |
Operating lease liabilities, less current portion | 22,575 | 11,324 |
Other liabilities | 13,778 | 15,557 |
Total Liabilities | 608,708 | 287,692 |
Commitments and Contingencies (Note 10) | 0 | 0 |
Stockholders’ Equity | ||
Preferred shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.0001 par value; 220,000,000 shares authorized; 38,871,646 and 38,426,669 shares issued and outstanding at December 31, 2021 and December 31, 2020, respectively | 4 | 4 |
Additional paid-in capital | 330,616 | 325,679 |
Accumulated deficit | (26,436) | (25,442) |
Accumulated other comprehensive income | 9,687 | 8,605 |
Total stockholders’ equity | 313,871 | 308,846 |
Total Liabilities and Stockholders’ Equity | $ 922,579 | $ 596,538 |
Consolidated and Combined Balan
Consolidated and Combined Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 1,285 | $ 955 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 220,000,000 | 220,000,000 |
Common stock, shares issued (in shares) | 38,871,646 | 38,426,669 |
Common stock, shares outstanding (in shares) | 38,871,646 | 38,426,669 |
Consolidated and Combined State
Consolidated and Combined Statements of Operations - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||||
Product revenues, net | $ 147,168 | $ 128,328 | $ 493,973 | $ 272,123 |
Cost of goods sold | 101,585 | 77,627 | 335,218 | 163,634 |
Gross profit | 45,583 | 50,701 | 158,755 | 108,489 |
Selling, general and administrative expenses | 44,616 | 43,355 | 113,141 | 65,896 |
Amortization of intangible assets | 6,021 | 4,927 | 18,295 | 10,724 |
Asset impairment charges | 0 | 40,600 | 0 | 0 |
Restructuring and other expenses | 1,052 | 0 | 4,503 | 2,193 |
Operating income (loss) | (6,106) | (38,181) | 22,816 | 29,676 |
Change in fair value of warrant liabilities | 0 | 0 | 29 | 0 |
Interest expense, net | (4,371) | (238) | (24,589) | (500) |
Loss on extinguishment and debt transaction costs | 0 | 0 | (5,513) | 0 |
Other income (expense), net | (578) | 801 | 196 | (830) |
(Loss) income before income taxes | (11,055) | (37,618) | (7,061) | 28,346 |
Benefit for income taxes | (2,618) | (3,482) | (7,144) | (2,466) |
Net income (loss) | $ (8,437) | $ (34,136) | $ 83 | $ 30,812 |
Net earnings (loss) per share: | ||||
Basic (in dollars per share) | $ (0.22) | $ 0 | ||
Diluted (in dollars per share) | $ (0.22) | $ 0 | ||
Revenue from Contract with Customer, Product and Service [Extensible List] | Product [Member] | Product [Member] | Product [Member] | Product [Member] |
Consolidated and Combined Sta_2
Consolidated and Combined Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (8,437) | $ (34,136) | $ 83 | $ 30,812 |
Other comprehensive income (loss), net of tax: | ||||
Net change in pension benefit obligations recognized, net of taxes of $26, $242, $65, and $(2,689), respectively. | 831 | 318 | 98 | (569) |
Foreign currency translation adjustments | 7,774 | (2,286) | 984 | (1,543) |
Total other comprehensive income (loss), net of tax | 8,605 | (1,968) | 1,082 | (2,112) |
Comprehensive income (loss) | $ 168 | $ (36,104) | $ 1,165 | $ 28,700 |
Consolidated and Combined Sta_3
Consolidated and Combined Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net change in pension benefit obligations recognized, tax | $ 242 | $ 65 | $ 26 | $ (2,689) |
Consolidated and Combined Sta_4
Consolidated and Combined Statements of Equity - USD ($) $ in Thousands | Total | Restatement adjustment | Predecessors | Common Stock | Additional Paid-in Capital | Additional Paid-in CapitalRestatement adjustment | Accumulated Deficit | Accumulated DeficitRestatement adjustment | Accumulated Other Comprehensive Income | Accumulated Other Comprehensive IncomePredecessors |
Beginning balance at Dec. 31, 2018 | $ 484,492 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Funding to Parent, net | (25,442) | |||||||||
Net income (loss) | 30,812 | |||||||||
Other comprehensive income (loss), net of tax | (2,112) | |||||||||
Ending balance at Dec. 31, 2019 | 487,750 | $ (8,059) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Funding to Parent, net | (11,924) | |||||||||
Net income (loss) | (34,136) | |||||||||
Other comprehensive income (loss), net of tax | (1,968) | |||||||||
Ending balance at Jun. 25, 2020 | 233,666 | $ 439,722 | $ 3 | $ 250,366 | $ (16,703) | 0 | $ (10,027) | |||
Ending balance (in shares) at Jun. 25, 2020 | 30,926,669 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Issuance of warrants | 7,895 | 7,895 | ||||||||
Issuance of common stock | 67,105 | $ 1 | 67,104 | |||||||
Issuance of common stock (shares) | 7,500,000 | |||||||||
Net income (loss) | (8,437) | (8,437) | ||||||||
Other comprehensive income (loss), net of tax | 8,605 | 8,605 | ||||||||
Stock-based compensation | 1,262 | 1,262 | ||||||||
Other | (1,250) | (948) | (302) | |||||||
Ending balance at Dec. 31, 2020 | 308,846 | $ (8,139) | $ 4 | 325,679 | $ (7,062) | (25,442) | $ (1,077) | 8,605 | ||
Ending balance (in shares) at Dec. 31, 2020 | 38,426,669 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Transfer of Private Warrants to Public Warrants | 6,057 | 6,057 | ||||||||
Net income (loss) | 83 | 83 | ||||||||
Other comprehensive income (loss), net of tax | 1,082 | 1,082 | ||||||||
Warrant exercises | $ 1 | 1 | ||||||||
Warrant exercises (in shares) | 100 | |||||||||
Stock-based compensation | $ 7,854 | 7,854 | ||||||||
Net share settlements of stock-based compensation | (1,913) | (1,913) | ||||||||
Net share settlements of stock-based compensation (in shares) | 444,877 | |||||||||
Ending balance at Dec. 31, 2021 | $ 313,871 | $ 4 | $ 330,616 | $ (26,436) | $ 9,687 | |||||
Ending balance (in shares) at Dec. 31, 2021 | 38,871,646 |
Consolidated and Combined Sta_5
Consolidated and Combined Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Operating activities | ||||
Net income (loss) | $ (8,437) | $ (34,136) | $ 83 | $ 30,812 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Stock-based compensation | 1,262 | 0 | 8,715 | 0 |
Depreciation | 1,652 | 1,334 | 4,727 | 3,031 |
Amortization of intangible assets | 6,021 | 4,927 | 18,295 | 10,724 |
Deferred income taxes | (2,842) | (5,578) | (12,300) | (10,500) |
Asset impairment charges | 0 | 40,600 | 0 | 0 |
Amortization of inventory fair value adjustments | 12,613 | 0 | (3,396) | 0 |
Non-cash loss on extinguishment of debt | 0 | 0 | 4,435 | 0 |
Change in fair value of warrant liabilities | 0 | 0 | (29) | 0 |
Changes in current assets and liabilities: | ||||
Accounts receivable | (4,554) | 7,726 | 964 | 1,311 |
Inventories | (5,305) | 3,576 | (22,957) | 2,004 |
Prepaid expenses and other current assets | (2,066) | 3,330 | (1,030) | (3,097) |
Accounts payable, accrued liabilities and income taxes | (7,939) | 507 | 12,050 | (3,057) |
Other, net | 150 | (2,378) | (75) | 437 |
Net cash provided by (used in) operating activities | (9,445) | 19,908 | 9,482 | 31,665 |
Investing activities | ||||
Capital expenditures | (4,489) | (3,532) | (12,198) | (4,037) |
Acquisitions, net of cash acquired | (456,508) | 0 | (190,231) | 0 |
Proceeds from sale of fixed assets | 0 | 0 | 4,516 | 0 |
Transfer from trust account | 178,875 | 0 | 0 | 0 |
Net cash used in investing activities | (282,122) | (3,532) | (197,913) | (4,037) |
Financing activities | ||||
Proceeds from revolving credit facility | 47,855 | 3,500 | 25,000 | 1,500 |
Repayments of revolving credit facility | 0 | (8,500) | (47,855) | 0 |
Long-term borrowings | 140,000 | 0 | 375,000 | 0 |
Repayments of long-term borrowings | (3,500) | 0 | (139,314) | 0 |
Debt issuance costs | (7,139) | 0 | (11,589) | 0 |
Proceeds from sale of common stock and warrants | 75,000 | 0 | 1 | 0 |
Tax withholdings related to net share settlements of stock-based awards | 0 | 0 | (1,913) | 0 |
Funding to Parent, net | 0 | (11,924) | 0 | (25,442) |
Net cash provided by (used in) financing activities | 252,216 | (16,924) | 199,330 | (23,942) |
Effect of exchange rate changes on cash and cash equivalents | 714 | 215 | 499 | (496) |
Net change in cash and cash equivalents | (38,637) | (333) | 11,398 | 3,190 |
Cash and cash equivalents, beginning of period | 55,535 | 10,395 | 16,898 | 7,205 |
Cash and cash equivalents, end of period | 16,898 | 55,535 | 28,296 | 10,395 |
Supplemental disclosure of cash flow information | ||||
Interest paid | 3,328 | 798 | 21,203 | 0 |
Taxes paid, net of refunds | 3,091 | 2,244 | 4,523 | 4,571 |
Supplemental disclosure of non-cash investing | ||||
Non-cash capital expenditures | 0 | 0 | $ 3,796 | $ 0 |
Predecessors | ||||
Financing activities | ||||
Cash and cash equivalents, beginning of period | $ 10,062 | |||
Cash and cash equivalents, end of period | $ 10,062 |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1: BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Whole Earth Brands, Inc. and its consolidated subsidiaries (“Whole Earth Brands” or the “Company”) is a global industry-leading platform, focused on the “better for you” consumer packaged goods (“CPG”) and ingredients space. The Company has a global platform of branded products and ingredients, focused on the consumer transition towards natural alternatives and clean label products. On June 24, 2020, Act II Global Acquisition Corp., a Cayman Islands exempted company (“Act II”), domesticated into a Delaware corporation (the “Domestication”), and on June 25, 2020 (the “Closing”), consummated the indirect acquisition (the “Business Combination”) of (i) all of the issued and outstanding equity interests of Merisant Company (“Merisant”), Merisant Luxembourg Sarl (“Merisant Luxembourg”), Mafco Worldwide LLC (“Mafco Worldwide”), Mafco Shanghai LLC (“Mafco Shanghai”), EVD Holdings LLC (“EVD Holdings”), and Mafco Deutschland GmbH (together with Merisant, Merisant Luxembourg, Mafco Worldwide, Mafco Shanghai, and EVD Holdings, and their respective direct and indirect subsidiaries, “Merisant and Mafco Worldwide”), and (ii) certain assets and liabilities of Merisant and Mafco Worldwide included in the Transferred Assets and Liabilities (as defined in the Purchase Agreement (as hereafter defined)), from Flavors Holdings Inc. (“Flavors Holdings”), MW Holdings I LLC (“MW Holdings I”), MW Holdings III LLC (“MW Holdings III”), and Mafco Foreign Holdings, Inc. (“Mafco Foreign Holdings,” and together with Flavors Holdings, MW Holdings I, and MW Holdings III, the “Sellers”), pursuant to that certain Purchase Agreement (the “Purchase Agreement”) entered into by and among Act II and the Sellers dated as of December 19, 2019, as amended. In connection with the Domestication, Act II changed its name to “Whole Earth Brands, Inc.” Upon the completion of the Domestication, each of Act II’s then-issued and outstanding ordinary shares converted, on a one-for-one basis, into shares of common stock of Whole Earth Brands. Additionally, immediately after the Business Combination, the Company issued an aggregate of 7,500,000 shares of Whole Earth Brands common stock and 5,263,500 private placement warrants exercisable for 2,631,750 shares of Whole Earth Brands common stock to certain investors. On the date of Closing, the Company’s common stock and warrants began trading on The Nasdaq Stock Market under the symbols “FREE” and “FREEW,” respectively. As a result of the Business Combination, for accounting purposes, Act II was deemed to be the acquirer and Mafco Worldwide and Merisant Company were deemed to be the acquired parties and, collectively, the accounting predecessor. The Company’s financial statement presentation includes the combined financial statements of Mafco Worldwide and Merisant Company as the “Predecessor” for periods prior to the completion of the Business Combination and includes the consolidation of Mafco Worldwide and Merisant Company, for periods after the Closing (referred to as the “Successor”). The combined financial statements for the “Predecessor” periods include the accounts of Mafco Worldwide and Merisant Company which were wholly owned subsidiaries of Flavors Holdings Inc. Flavors Holdings Inc. is an indirect, wholly owned subsidiary of MacAndrews & Forbes Incorporated, which was not acquired in the Business Combination. Principles of Consolidation —The consolidated and combined financial statements include the accounts of Whole Earth Brands, Inc., and its indirect and wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated and combined financial statements and accompanying notes. Actual results could differ from these estimates. Reclassifications —Certain previously reported amounts have been reclassified to conform to the current presentation. Cash and Cash Equivalent s—The Company considers all cash on hand, money market funds, and other highly liquid debt instruments with a maturity, when purchased, of three months or less to be cash and cash equivalents. Accounts Receivable and Allowance for Doubtful Accounts —Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable losses in its existing accounts receivable based on historical losses and current economic conditions. Account balances are charged against the allowance when the Company believes it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Recoveries of accounts receivable previously offset against the allowance are recorded in the combined statements of operations when received. Inventories —Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predicable costs of completion, disposal, and transportation. The cost of inventory is determined principally by the first in, first out method. Property, Plant and Equipment —Property, plant and equipment are recorded at cost. Additions, improvements, and replacements that extend asset life are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of the Company’s property, plant and equipment in service currently ranges as follows: 3 to 40 years for buildings and 1 to 20 years for all other equipment. When property and equipment are disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gains or losses are included in income from operations. Ordinary repairs and maintenance costs are charged to operating expense as incurred. Deferred Software Costs —Deferred implementation costs for hosted cloud computing service arrangements are stated at historical cost and amortized on a straight-line basis over the term of the hosting arrangement that the implementation costs relate to. Deferred implementation costs are included in other assets and amortized to selling, general and administrative expenses (“SG&A”). The corresponding cash flows related to deferred software costs will be reported within operating activities consistent with the treatment for payments associated with the service component of the hosting arrangement. The Company reviews the deferred implementation costs for impairment when it believes the deferred costs may no longer be recoverable. As of December 31, 2021, deferred software costs associated with cloud computing arrangements were $1.0 million and no costs were amortized during 2021. There were no deferred software costs recorded in 2020. Leases —As of the date of the Business Combination, the Company accounts for leases pursuant to Accounting Standards Codification (“ASC”) Topic 842, “Leases.” Under ASC Topic 842, a right-of-use asset and a lease liability is recorded for all leases with a term greater than 12 months. Lease right-of-use assets and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using our incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. The Company’s lease portfolio includes a factory building, office space, warehouses, material handling equipment, vehicles and office equipment. All of our leases are classified as operating leases. Goodwill and Other Indefinite-Lived Intangible Assets —Goodwill and other indefinite-lived intangible assets are summarized in Note 6. The Company reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles—Goodwill and Other.” Under ASC Topic 350, the impairment review of goodwill and other intangible assets not subject to amortization must be based on estimated fair values. The Company’s annual impairment review measurement date is in the fourth quarter of each year. In performing the annual assessment, the Company has the option of performing a qualitative assessment to determine if it is more likely than not that a reporting unit has been impaired. As part of the qualitative assessment for the reporting units, the Company evaluates the factors that are specific to the reporting units as well as industry and macroeconomic factors (including changes in interest and discount rates). The reporting unit specific factors may include cost factors, a comparison of current year results to prior year, current year budget and future projected financial performance. The Company also considers the change in the overall enterprise value of the Company compared to the prior year. If the Company determines that it is more likely than not that a reporting unit is impaired or if the Company elects not to perform the optional qualitative assessment, a quantitative assessment is performed utilizing both the income and market approaches to estimate the fair value of its reporting units. The income approach involves discounting future estimated cash flows. The discount rate used is the value-weighted average of the reporting unit’s estimated cost of equity and debt (“cost of capital”) derived using both known and estimated customary market metrics adjusted for company specific risks. The Company performs sensitivity tests with respect to growth rates and discount rates used in the income approach. In applying the market approach, valuation multiples are derived from historical and projected operating data of selected guideline companies; evaluated and adjusted, if necessary, based on the strengths and weaknesses of the reporting unit relative to the selected guideline companies; and applied to the appropriate historical and/or projected operating data to arrive at an indication of fair value. The Company typically weights the results of the income and market approaches equally. If the reporting unit’s carrying value exceeds its estimated fair value, then an impairment is recorded for the difference, limited to the total amount of goodwill allocated to the reporting unit. The Company typically evaluates impairment of indefinite-lived intangible assets, which relates to our product formulations, by first performing a qualitative assessment. If the Company elects to bypass the qualitative assessment or determines that it is more likely than not that the fair value of the product formulations is less than its carrying value, a quantitative assessment is then performed using the relief from royalty method under the income approach to estimate the fair value. Some of the more significant assumptions inherent in estimating the fair value include the estimated future annual sales, royalty rates (as a percentage of sales that would hypothetically be charged by a licensor of the brand to an unrelated licensee), income tax considerations and a discount rate that reflects the level of risk. Impairment Review of Long-Lived Assets —In accordance with ASC Topic 360, “Property, Plant and Equipment,” the Company evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may be impaired. When such events occur, the Company compares the sum of the future undiscounted cash flows expected to be generated from the asset or asset group over its remaining depreciable life to the carrying value. If this comparison indicates that there is an impairment, the carrying amount of the long-lived asset would then be reduced to the estimated fair value, which generally approximates discounted cash flows. The Company also evaluates the amortization periods of assets to determine whether events or circumstances warrant revised estimates of useful lives. The Company’s applicable long-lived assets include its property, plant and equipment and definite-lived intangible assets. Income Taxes —The provision for income taxes for the Successor period is determined using the asset and liability method in accordance with ASC Topic 740, “Accounting for Income Taxes.” The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. For the Predecessor period, income taxes as presented herein are attributable to current and deferred income taxes of the Company’s financial statements in a manner that is systematic, rational, and consistent with the asset and liability method described by ASC Topic 740. Accordingly, the Company’s income tax provision during the Predecessor period was prepared following the separate return method. The separate return method applies ASC Topic 740 to the stand-alone financial statements of each member of the combined group as if the group member were a separate taxpayer and a stand-alone enterprise. Use of the separate return method may result in differences when the sum of the amounts allocated to stand-alone tax provisions are compared with amounts presented in the combined financial statements. In that event, the related deferred tax assets and liabilities could be significantly different from those presented herein. The combined financial statements reflect the Company’s portion of income taxes payable as if the Company had been a separate taxpayer. The Company made a policy election to treat the income tax due on United States (“U.S.”) inclusion of the global intangible low taxed income (“GILTI”) provisions as a period expense when incurred. Uncertainty in Income Taxes —The Company accounts for uncertain tax positions in accordance with the authoritative guidance issued under ASC Topic 740, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company provides loss contingencies for federal, state and international tax matters relating to potential tax examination issues, planning initiatives and compliance responsibilities. The development of these reserves requires judgements about tax issues, potential outcomes and timing, which if different, may materially impact the Company’s financial condition and results of operations. The Company classifies interest and penalties associated with income taxes as a component of provision (benefit) for income taxes in the consolidated and combined statements of operations. Pension Plans —The Company has defined benefit pension plans and defined contribution 401(k) plans, which cover certain current and former employees of the Company who meet eligibility requirements. Benefits for the defined benefit pension plans are based on years of service and, in some cases, the employee’s compensation and participation was frozen to all employees hired on or after August 1, 2017. The Company’s policy is to contribute annually the amount required pursuant to the Employee Retirement Income Security Act. The Company froze the pension plan for all participants on December 31, 2019. Certain subsidiaries of the Company outside the U.S. have retirement plans that provide certain payments upon retirement. The Company recognizes in its balance sheet the funded status of its defined benefit pension plans, measured as the difference between the fair value of the plan assets and the benefit obligation and recognizes changes in the funded status of the defined benefit pension plans as accumulated other comprehensive loss, net of tax, within accumulated other comprehensive income (loss) to the extent such changes are not recognized in earnings as components of periodic net benefit cost (see Note 12). These amounts are subsequently amortized within other income (expense) in future periods using the corridor approach. The corridor is 10% of the greater of the market-related value of the plan’s assets or projected benefit obligation. Any actuarial gains and losses in excess of the corridor are then amortized over an appropriate term. Research and Development Costs —The Company expenses costs as incurred for product research and development within SG&A. Research and development expenses were approximately $3.4 million for 2021, $1.6 million for the period from June 26, 2020 to December 31, 2020, $1.7 million for the period from January 1, 2020 to June 25, 2020 and $3.4 million for 2019. Self-Insurance —The Company is self-insured for certain workers’ compensation. Provisions for losses expected under the program are recorded based on the Company’s estimates of the aggregate liabilities for the claims incurred. As of December 31, 2021 and 2020, the liabilities for self-insured workers compensation were $0.1 million and $0.5 million, respectively. Stock-Based Compensation —In accordance with ASC Topic 718, “Compensation—Stock Compensation,” the Company recognizes stock-based compensation cost in its consolidated statements of operations. Stock-based compensation cost is measured at the grant date for equity-classified awards and at the end of each reporting period for liability-classified awards based on the estimated fair value of the awards. The Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. Additional information pertaining to the Company’s stock-based compensation is provided in Note 13. Revenue Recognition —In accordance with ASC Topic 606, “Revenue from Contracts with Customers,” the Company recognizes revenue when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenues are primarily derived from customer orders for the purchase of products and are generally recognized when the product is shipped or delivered depending on the arrangement with the customer. The Company made an accounting policy election to exclude from the measurement of the transaction price sales taxes and all other items of a similar nature, and also elected to account for shipping and handling activities as a fulfillment of the promise to transfer the goods. Accordingly, shipping and handling costs are included in cost of sales. Branded CPG may offer promotional activities (e.g. coupons, trade discounts and other promotional activities) to its customers. These variable consideration amounts are estimated for each customer based on specific arrangements/agreements, an analysis of historical volume, and/or current activity with that customer. Reassessment of variable consideration estimates is done at each reporting date throughout the contract period until the uncertainty is resolved (e.g. promotional campaign is closed and settled with customer). Historically, the Company has encountered limited instances whereby customers rejected products as a result of orders being materially inaccurate and/or products being defective. The Company tracks the reason codes for those customer returns. Based on that, the materiality of such returns is assessed. A return reserve is calculated (based on historical data as described above) every month to record an adjustment to net sales; these adjustments have not been significant. The following table presents the Company’s revenues disaggregated by product categories (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Sweeteners and adjacencies $ 389,174 $ 96,857 $ 80,749 $ 165,863 Licorice products 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 The following table presents revenues disaggregated by business and geographic region (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Branded CPG: North America $ 266,661 $ 40,273 $ 29,926 $ 59,945 Europe 76,392 35,384 31,838 64,259 India, Middle East and Africa 13,363 6,727 3,778 12,565 Asia-Pacific 20,787 8,172 9,328 16,922 Latin America 11,971 6,301 5,879 12,172 Flavors & Ingredients 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 The Company records an allowance for doubtful accounts as an estimate of the inability of its customers to make their required payments. The determination of the allowance requires the Company to make assumptions about the future ability to collect amounts owed from customers. Marketing and Advertising Costs —The Company promotes its products with marketing activities, including advertising, consumer incentives and trade promotions. On an annual basis, advertising costs are expensed as incurred or in the year in which the related advertisement initially appears. Marketing and advertising expense was $17.0 million in 2021, $6.2 million for the period from June 26, 2020 through December 31, 2020, $4.8 million from January 1, 2020 through June 25, 2020, and $11.9 million in 2019. Consumer incentive and trade promotion activities are deducted from revenue based on amounts estimated as being or becoming due to customers and consumers at the end of a period, based principally on the Company’s historical utilization and redemption rates. These deductions are estimated and recorded upon sale of product by the Company and revised as necessary at each period end. Fair Value of Financial Instruments —The Company measures fair value using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is 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. The carrying amounts for cash and cash equivalents, trade accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short-term maturity. The Company measures its term loan and revolving facilities at original carrying value including accrued interest, net of unamortized deferred financing costs and fees. The fair value of the credit facilities approximates carrying value, as they consist of variable rate loans. Major Customers and Credit Concentration —The Company sells products to customers in the U.S. and internationally. The Company performs ongoing credit evaluations of customers, and generally does not require collateral on trade accounts receivable. Allowances are maintained for potential credit losses and such losses have been within management’s expectations. Foreign Currency Translation —The Company has determined that the functional currency for each combined subsidiary is its local currency, except for certain entities whose functional currency is the U.S. dollar. Assets and liabilities of entities outside the U.S. are translated into U.S. dollars at the exchange rates in effect at the end of each period and income statement accounts are translated at each period’s average exchange rate. Translation adjustments arising from the use of differing exchange rates from period to period are included as a component of accumulated other comprehensive income (loss) on the balance sheet, except for any entities which may operate in highly inflationary economies. Gains and losses resulting from transactions in other than functional currencies are reflected in operating results, except for transactions of a long-term nature. Remeasurements of European entities whose functional currency is the U.S. dollar as well as translation adjustments for entities operating in highly inflationary economies and impacts of foreign currency transactions are recognized currently in other income (expense), net in the accompanying consolidated and combined statements of operations. The Company had foreign exchange losses, net of $0.2 million in 2021, foreign exchange losses, net of $0.9 million for the period from June 26, 2020 through December 31, 2020, foreign exchange gains, net of $0.5 million from January 1, 2020 through June 25, 2020, and foreign exchange losses, net of $2.0 million in 2019. Beginning January 1, 2019, the Company was required to apply highly-inflationary accounting to its Argentinian subsidiary. This accounting treatment requires a change in the subsidiary’s functional currency from the local currency (Argentinian Peso) to the parent’s reporting currency (USD). This highly-inflationary classification results from the fact that the cumulative inflation rate for the preceding 3 year period exceeded 100 percent as of June 30, 2018. When the Company changed the functional currency, it revalued the subsidiary’s financial statements as if the new functional currency (USD) were the reporting currency. Accordingly, effective January 1, 2019, all Argentinian Peso denominated monetary assets and liabilities are considered foreign currency denominated assets and liabilities and are revalued to USD (the functional currency) with remeasurement adjustments in the period recorded in the statement of operations. The USD will be the functional currency until the economic environment in Argentina ceases to be considered highly-inflationary. As of the date of the Business Combination, the assets and liabilities of the Argentinian subsidiary were adjusted to fair value. Certain non-monetary assets and liabilities that were previously recorded at the applicable historical exchange rates are recorded in USD using the exchange rate as of June 25, 2020. Argentinian Peso denominated monetary assets and liabilities continue to be revalued to USD (the functional currency) with remeasurement period adjustments in the period recorded in the statement of operations. The Company recorded $0.3 million of expense related to remeasurement adjustments in the consolidated statements of operations for both the year ended December 31, 2021 and the period of June 26, 2020 to December 31, 2020, respectively. The impact was not material for the period of January 1, 2020 to June 25, 2020. Restructuring and Employee Termination Benefits —During 2020 and 2019, the Company adopted restructuring plans to streamline processes and realize cost savings by consolidating facilities and eliminating various positions in operations and general and administrative areas. In connection with the restructuring plans, the Company recognized restructuring and other expenses of $4.5 million, $1.1 million and $2.2 million during the year ended December 31, 2021, for the period from June 26, 2020 to December 31, 2020 and during the year ended December 31, 2019, respectively. This included facility exit and other related costs of $3.9 million and $1.6 million in 2021 and 2019, respectively, and employee termination benefits of $0.6 million in both 2021 and 2019, and $1.1 million for the period from June 26, 2020 to December 31, 2020. In 2021, the Company paid employee termination benefits of $0.8 million. The Company had accrued severance expense related to the restructuring plans of $0.8 million and $1.0 million at December 31, 2021 and 2020, respectively. Termination benefits are payable when an employee is involuntarily terminated, or whenever an employee accepts voluntary termination in exchange for termination benefits. One-time involuntary termination benefits are recognized as a liability when the termination plan meets certain criteria and has been communicated to employees. If employees are required to render future service in order to receive these one-time termination benefits, the liability is recognized ratably over the future service period. Warrant Liabilities —The Company accounts for the Private Warrants in accordance with ASC Topic 815, “Derivatives and Hedging.” Under the guidance contained in ASC Topic 815-40, the Private Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Private Warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. The liability is subject to re-measurement at each balance sheet date, and any change in fair value is recognized in the Company’s statement of operations. The Private Warrants are valued using a Black-Scholes option pricing model. Based on the views expressed in the SEC’s Staff Statement of April 12, 2021 in which the SEC staff clarified its interpretations of certain generally accepted accounting principles related to certain terms common in warrants issued by Special Purpose Acquisition Companies (“SPACs”), the Company determined that the Private Warrants should be treated as derivative liabilities rather than as components of equity, as previously presented as of December 31, 2020. Accordingly, the Company recorded out of period adjustments at January 1, 2021 to reclassify warrant liabilities of $8.1 million and transaction costs incurred by Act II of $1.1 million related to the issuance of the Private Warrants. Additionally, during the first quarter of 2021, the Company recognized the cumulative effect of the error on prior periods by recording a $1.2 million gain in the Statement of Operations to reflect the cumulative decrease in the fair value of the Private Warrants from the date of issuance through December 31, 2020. The Company concluded that this misstatement was not material to the current period or the previously filed financial statements. Accounting Standards Adopted in the Current Year —The Company qualifies as an emerging growth company (an “EGC”) and as such, has elected the extended transition period for complying with certain new or revised accounting pronouncements. During the extended transition period, the Company is not subject to certain new or revised accounting standards applicable to public companies. The accounting pronouncements pending adoption below reflect effective dates for the Company as an EGC with the extended transition period. In August 2018, the FASB issued ASU 2018-15, “Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” Under the new guidance, implementation costs incurred in a hosting arrangement that is a service contract should be expensed or deferred based on the nature of the costs and the project stage during which such costs are incurred. If the implementation costs qualify for deferral, they are required to be amortized over the term of the hosting arrangement and assessed for impairment. Additionally, the ASU requires disclosure of the |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
BUSINESS COMBINATION | NOTE 2: BUSINESS COMBINATIONS On June 25, 2020, pursuant to the Business Combination, the Company indirectly acquired Merisant and Mafco Worldwide in a transaction accounted for as a business combination under ASC Topic 805, “Business Combinations,” and was accounted for using the acquisition method. Under the acquisition method, the acquisition date fair value of the consideration paid by the Company was allocated to the assets acquired and the liabilities assumed based on their estimated fair values. The following summarizes the purchase consideration (in thousands): Base cash consideration $ 387,500 Closing adjustment (764) Total Purchase Price $ 386,736 The Company recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Cash and cash equivalents $ 10,062 Accounts receivable 45,769 Inventories 106,436 Prepaid expenses and other current assets 2,461 Property, plant and equipment, net 43,554 Operating lease right-of-use assets 12,541 Intangible assets 148,750 Deferred tax assets, net 1,065 Other assets 1,398 Total assets acquired 372,036 Accounts payable 18,590 Accrued expenses and other current liabilities 35,063 Current portion of operating lease liabilities 3,007 Operating lease liabilities, less current portion 12,208 Deferred tax liabilities, net 24,630 Other liabilities 16,227 Total liabilities assumed 109,725 Net assets acquired 262,311 Goodwill 124,425 Total Purchase Price $ 386,736 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 47,359 0.5 to 10 Tradenames 90,691 25 Product formulations 10,700 Indefinite $ 148,750 Goodwill represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and expected future market opportunities. Of the purchase price allocated to goodwill, $2.5 million will be deductible for income tax purposes pursuant to Internal Revenue Code (“IRC”) Section 197 over a 15 year period. The Company’s allocation of purchase price was based upon valuations performed to determine the fair value of the net assets as of the acquisition date and was subject to adjustments for up to one year after the closing date of the acquisition to reflect final valuations. The allocation of purchase price was finalized in the second quarter of 2021. In the first half of 2021, the Company recorded measurement period adjustments to its allocation of purchase price resulting in an increase in deferred tax liabilities, net of $1.5 million, other liabilities of $0.7 million and goodwill of $2.2 million. Direct transaction-related costs consist of costs incurred in connection with the Business Combination. Act II incurred transaction costs of $18.1 million prior to the Business Combination which are reflected within the accumulated deficit within the Consolidated Statement of Equity. During the three months ended March 31, 2021, the Company reclassified $1.1 million of Act II transaction costs related to the issuance of the Private Warrants that had been previously recorded in additional paid-in capital in connection with the Business Combination to accumulated deficit (See Note 1). Swerve Acquisition —On November 10, 2020, the Company executed and closed a definitive Equity Purchase Agreement (the “Purchase Agreement”) with RF Development, LLC (“RF Development”), Swerve, L.L.C. (“Swerve LLC”) and Swerve IP, L.L.C. (“Swerve IP” and together with Swerve LLC, “Swerve”). Swerve is a manufacturer and marketer of a portfolio of zero sugar, keto-friendly, and plant-based sweeteners and baking mixes. The Company purchased all of the issued and outstanding equity interests of both Swerve LLC and Swerve IP from RF Development for $80 million in cash, subject to customary post-closing adjustments. The transaction was funded through a combination of available cash on hand and approximately $47.9 million under the Company’s $50 million revolving loan facility. In connection with the acquisition of Swerve, the Company incurred transaction-related costs of $0.3 million and $3.2 million for the years ended December 31, 2021 and December 31, 2020, respectively. Swerve is included within the Company’s Branded CPG reportable segment. Swerve’s results are included in the Company’s consolidated statement of operations from the date of acquisition. The following summarizes the purchase consideration (in thousands): Base cash consideration $ 80,000 Closing adjustment (968) Total Purchase Price $ 79,032 The Company recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Accounts receivable $ 3,223 Inventories 6,824 Prepaid expenses and other current assets 223 Property, plant and equipment, net 143 Operating lease right-of-use assets 76 Intangible assets 36,300 Other assets 3 Total assets acquired 46,792 Accounts payable 3,477 Accrued expenses and other current liabilities 288 Current portion of operating lease liabilities 48 Operating lease liabilities, less current portion 28 Total liabilities assumed 3,841 Net assets acquired 42,951 Goodwill 36,081 Total Purchase Price $ 79,032 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 3,200 10 Tradenames 33,100 25 $ 36,300 Goodwill represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and expected future market opportunities. The entire amount of the purchase price allocated to goodwill will be deductible for income tax purposes pursuant to IRC Section 197 over a 15 year period. The Company’s allocation of purchase price was based upon valuations performed to determine the fair value of the net assets as of the acquisition date and was subject to adjustments for up to one year after the closing date of the acquisition to reflect final valuations. The allocation of purchase price was finalized in the fourth quarter of 2021. Wholesome Acquisition —On December 17, 2020, the Company entered into a stock purchase agreement (the “Wholesome Purchase Agreement”) with WSO Investments, Inc. (“WSO Investments” and together with its subsidiaries “Wholesome” and affiliates). WSO Investments is the direct parent of its wholly-owned subsidiary Wholesome Sweeteners, Incorporated, which was formed to import, market, distribute, and sell organic sugars, unrefined specialty sugars, and related products. Wholesome is included within the Company’s Branded CPG reportable segment. Wholesome’s results are included in the Company’s consolidated statement of operations from the date of acquisition. On February 5, 2021, pursuant to the terms of the Wholesome Purchase Agreement, the Company purchased and acquired all of the issued and outstanding shares of capital stock for an initial cash purchase price of $180 million plus up to an additional $55 million (the “Earn-Out Amount”) upon the satisfaction of certain post-closing financial metrics. Subject to the terms and conditions of the Wholesome Purchase Agreement payment of the Earn-Out Amount, in whole or in part, was subject to Wholesome achieving certain EBITDA thresholds at or above approximately $30 million during the period beginning August 29, 2020, and ending December 31, 2021 (the “Earn-Out Period”). A portion of the Earn-Out Amount (up to $27.5 million) could be paid, at the Company’s election, in freely tradeable, registered shares of Company common stock calculated using the 20-day volume weighted average trading price per share as of the date of determination. Calculation of the achievement of the Earn-Out Amount is subject to certain adjustments more thoroughly described in the Wholesome Purchase Agreement. In connection with the acquisition of Wholesome, the Company incurred transaction-related costs of $4.7 million in the year ended December 31, 2021. Following the completion of the Earn-Out Period, the Company determined, in accordance with the terms of the Purchase Agreement, that the sellers were entitled to receive the Earn-Out Amount in full. The Company elected to satisfy part of the Earn-Out Amount in common stock and on February 23, 2022, issued 2,659,574 shares of the Company’s common stock. The remaining $30 million portion of the $55 million Earn-Out Amount was paid in cash which was funded from available capacity under the Company’s revolving credit facility. The settlement of the earn-out will result in a non-cash gain of approximately $1.0 million that will be recorded in the first quarter of 2022 which represents the difference in value of the common stock issued using the 20-day volume weighted average trading price per share as compared to the trading price on the date of issuance. The following summarizes the preliminary purchase consideration (in thousands): Base cash consideration $ 180,000 Closing adjustment 13,863 Fair value of Earn-Out Amount 52,395 Total Purchase Price $ 246,258 The Company preliminarily recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Cash and cash equivalents $ 2,664 Accounts receivable 15,868 Inventories 76,879 Prepaid expenses and other current assets 1,322 Property, plant and equipment, net 3,134 Operating lease right-of-use assets 7,585 Intangible assets 104,500 Other assets 1,189 Total assets acquired 213,141 Accounts payable 5,251 Accrued expenses and other current liabilities 10,576 Current portion of operating lease liabilities 1,435 Operating lease liabilities, less current portion 6,150 Deferred tax liabilities, net 24,234 Total liabilities assumed 47,646 Net assets acquired 165,495 Goodwill 80,763 Total Purchase Price $ 246,258 The preliminary values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 55,700 10 Tradenames 48,800 25 $ 104,500 Goodwill represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and expected future market opportunities. Of the purchase price allocated to goodwill, a total of $4.7 million will be deductible for income tax purposes pursuant to IRC Section 197 over a 9-year period. The Company’s preliminary allocation of purchase price was based upon preliminary valuations performed to determine the fair value of the net assets as of the acquisition date and is subject to adjustments for up to one year after the closing date of the acquisition to reflect final valuations. The accounting for the Wholesome acquisition is not complete as the valuation for certain acquired assets and liabilities have not been finalized. These final valuations of the assets and liabilities could have a material impact on the preliminary purchase price allocation disclosed above. Subsequent to the acquisition, the Company recorded measurement period adjustments to its initial allocation of purchase price as a result of ongoing valuation procedures on assets and liabilities assumed, including (i) an increase in purchase price of $3.6 million due to the finalization of the closing adjustment; (ii) a decrease to inventory of $1.8 million; (iii) an increase in prepaid expenses and other current assets of $0.5 million; (iv) an increase in property, plant and equipment of $0.4 million; (v) a decrease to intangible assets of $1.9 million; (vi) a decrease to other assets of $0.1 million; (vii) a decrease to accrued expenses and other current liabilities of $2.7 million; (viii) a decrease to deferred tax liabilities, net of $2.8 million; and (ix) an increase to goodwill of $1.0 million due to the incremental measurement period adjustments discussed in items (i) through (viii). The impact of measurement period adjustments to the results of operations was immaterial. The results of the Company’s operations for the year ended December 31, 2021 includes the results of Wholesome since February 5, 2021. Product revenues, net and operating income of Wholesome included in the Company’s consolidated statement of operations for the year ended December 31, 2021 were $179.6 million and $20.6 million, respectively. Pro Forma Financial Information — The following unaudited pro forma financial information summarizes the results of operations for the Company as though the Business Combination and Swerve acquisition had occurred on January 1, 2019 and the Wholesome acquisition had occurred on January 1, 2020 (in thousands): Pro Forma Statements of Operations Year Ended December 31, 2021 December 31, 2020 Revenue $ 514,353 $ 499,652 Net income (loss) $ 14,082 $ (38,266) The unaudited pro forma financial information does not assume any impacts from revenue, cost or other operating synergies that could be generated as a result of the acquisitions. The unaudited pro forma financial information is for informational purposes only and is not indicative of the results of operations that would have been achieved had the Business Combination and Swerve acquisitions been consummated on January 1, 2019 and the Wholesome acquisition been consummated on January 1, 2020. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
LEASES | NOTE 3: LEASES The Company’s lease portfolio includes factory buildings, office space, warehouses, material handling equipment, vehicles and office equipment. The Company subleases some of its unused office space to third parties. Included in the Wholesome purchase price allocation are right-of-use assets and operating lease liabilities of $7.6 million related to two leases acquired. All leases are classified as operating leases. Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one Lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The Company’s lease agreements do not contain any residual value guarantees. Some leases include variable payments that are based on the usage and occupancy of the leased asset. The Company has elected not to record leases with an initial term of twelve months or less on the balance sheet. For real estate and vehicle leases, the Company elected the practical expedient to not separate lease from non-lease components within the contract. Electing this practical expedient means the Company accounts for each lease component and the related non-lease component together as a single component. For equipment leases, the Company has not elected this practical expedient and separates the non-lease components from the lease component. The right-of-use asset is subsequently measured throughout the lease term at the carrying amount of the lease liability. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The components of lease expense were as follows (in thousands): Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 Operating lease expense $ 5,658 $ 1,662 Variable lease expense 1,022 616 Short-term lease expense 988 47 Sublease income (508) (290) Total $ 7,160 $ 2,035 Lease expense under prior lease accounting rules for the period of January 1, 2020 to June 25, 2020 and the year ended December 31, 2019 was $2.2 million and $5.2 million, respectively. Sublease income was $0.3 million from January 1, 2020 through June 25, 2020 and $0.5 million for the year ended December 31, 2019. The following table presents the future maturities of the Company’s lease obligations as of December 31, 2021 (in thousands): 2022 $ 8,993 2023 9,204 2024 6,788 2025 4,069 2026 1,797 Thereafter 2,227 Total lease payments 33,078 Less: imputed interest (2,553) Total operating lease liabilities $ 30,525 The weighted-average remaining lease term was 4.0 years and the weighted-average discount rate was 3.99% as of December 31, 2021. The weighted-average remaining lease term was 4.6 years and the weighted-average discount rate was 3.42% as of December 31, 2020. Cash paid for amounts included in the measurement of the lease liability and for supplemental non-cash information was $5.7 million and $1.7 million for the year ended December 31, 2021 and for the period from June 26, 2020 to December 31, 2020, respectively. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4: INVENTORIES Inventories consisted of the following (in thousands): December 31, 2021 December 31, 2020 Raw materials and supplies $ 129,712 $ 66,487 Work in process 1,480 562 Finished goods 81,738 44,650 Total inventories $ 212,930 $ 111,699 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 5: PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following (in thousands): December 31, 2021 December 31, 2020 Machinery, equipment and other $ 32,048 $ 14,108 Buildings and improvements 21,243 20,247 53,291 34,355 Accumulated depreciation (6,591) (1,833) 46,700 32,522 Land 6,891 9,670 Construction in progress 4,912 5,093 Property, plant and equipment, net $ 58,503 $ 47,285 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 6: GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill and other intangible assets consisted of the following (in thousands): December 31, 2021 December 31, 2020 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Other intangible assets subject to amortization Customer relationships (useful life of 5 to 10 years) $ 106,013 $ (14,478) $ 91,535 $ 50,877 $ (3,020) $ 47,857 Tradenames (useful life of 25 years) 173,522 (8,818) 164,704 128,155 (2,185) 125,970 Total $ 279,535 $ (23,296) $ 256,239 $ 179,032 $ (5,205) $ 173,827 Other intangible assets not subject to amortization Product formulations 10,700 10,700 Total other intangible assets, net 266,939 184,527 Goodwill 242,661 153,537 Total goodwill and other intangible assets $ 509,600 $ 338,064 The Company amortizes its intangible assets subject to amortization on a straight-line basis over their respective useful lives. The remaining intangible assets subject to amortization as of December 31, 2021 have a weighted-average remaining useful life of approximately 18.2 years, including weighted-average remaining useful lives of approximately 8.1 years for customer relationships and approximately 23.8 years for tradenames. The Successor’s amortization expense for intangible assets was $18.3 million for the year ended December 31, 2021 and $6.0 million for the period from June 26, 2020 through December 31, 2020. The Predecessor’s amortization expense for intangible assets was $4.9 million for the period from January 1, 2020 to June 25, 2020 and $10.7 million for the year ended December 31, 2019. Amortization expense relating to amortizable intangible assets as of December 31, 2021 for the next five years is expected to be as follows (in thousands): 2022 $ 18,717 2023 18,717 2024 18,717 2025 18,483 2026 18,263 The changes in the carrying amounts of goodwill during the years ended December 31, 2021 and December 31, 2020 were as follows (in thousands): Branded CPG Flavors & Ingredients Total Balance at December 31, 2019 (Predecessor) $ 88,849 $ 42,021 $ 130,870 Impairment (11,100) (6,600) (17,700) Balance at June 25, 2020 (Predecessor) $ 77,749 $ 35,421 $ 113,170 Purchase accounting adjustments 40,779 (31,747) 9,032 Balance at June 26, 2020 (Successor) $ 118,528 $ 3,674 $ 122,202 Acquisition of Swerve 36,003 — 36,003 Currency translation adjustment (4,208) (460) (4,668) Balance at December 31, 2020 (Successor) $ 150,323 $ 3,214 $ 153,537 Purchase accounting adjustments 2,301 — 2,301 Acquisition of Wholesome 80,763 — 80,763 Currency translation adjustment 5,470 590 6,060 Balance at December 31, 2021 (Successor) $ 238,857 $ 3,804 $ 242,661 Impairment of Goodwill and Other Indefinite-Lived Intangible Assets —As disclosed in Note 1, the Company reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350. During the first quarter of 2020, the on-going macroeconomic disruption and uncertainty caused by the COVID-19 pandemic, including the impact on enterprise valuations across sectors, represented events which could indicate that the carrying value of goodwill and indefinite-lived intangible assets of the Predecessor may not be recoverable. As a result, the Predecessor performed an interim impairment assessment at March 31, 2020. In performing the quantitative assessment of indefinite-lived intangible assets, the estimated fair value was determined under an income approach using the discounted cash flow method which requires assumptions related to projected operating results and a discount rate using a market-based weighted-average cost of capital. The main assumptions supporting the cash flow projections included revenue growth, EBIT margins and discount rate. The financial projections reflected management’s best estimate of economic and market conditions over the projected period including forecasted revenue growth, EBIT margins, tax rate, capital expenditures, depreciation and amortization, changes in working capital requirements and the terminal growth rate. It was determined that the carrying value of the indefinite-lived intangible assets at Flavors & Ingredients exceeded their fair value and an impairment charge of $22.9 million was recorded in the first quarter of 2020. For the interim impairment assessment of goodwill as of March 31, 2020, the Predecessor utilized a market approach to estimate fair value based upon the then proposed purchase price of the Business Combination from a willing buyer in an active open market transaction. As a result of the interim quantitative impairment assessment, the carrying value of the Mafco Worldwide and Merisant reporting units exceeded their fair value by $6.6 million and $11.1 million, respectively, and a goodwill impairment charge of $17.7 million was recorded in the first quarter of 2020. The Company performs its annual impairment procedures for all of its reporting units and indefinite-lived intangible assets during the fourth quarter of each year. In 2021, the Company performed a quantitative impairment test and concluded that their fair values exceeded their respective carrying values and therefore, there was no impairment. The Company estimated the fair values of the reporting units utilizing both the income and market approach, equally weighted, to determine the fair values of the Company’s reporting units. The determination of estimated fair values requires significant judgments in estimating several factors, including, future cash flows, terminal growth rates, and discount rates. If current expectations of future cash flows are not met, if market factors outside of the Company’s control change, including those impacting discount rates, or if management’s expectations or plans otherwise change, then one or more of the Company’s reporting units might become impaired in the future. In 2020, the Company used a qualitative assessment for its impairment tests and concluded that it was more likely than not that their fair values exceeded their respective carrying values and therefore, did not result in an impairment. The Company plans to update its assessment during the fourth quarter of 2022, or sooner if events occur or circumstances change that could more likely than not reduce the fair value of a reporting unit or indefinite-lived intangible asset below its carrying value. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 7: DEBT Debt consisted of the following (in thousands): December 31, 2021 December 31, 2020 Term loan, due 2028 $ 372,187 $ 136,500 Revolving credit facility, due 2026 25,000 47,855 Less: current portion (3,750) (7,000) Less: unamortized debt issuance costs (9,953) (4,693) Total long-term debt $ 383,484 $ 172,662 Maturities —The Company’s debt and other obligations outstanding as of December 31, 2021 mature as shown below (in thousands): 2022 $ 3,750 2023 3,750 2024 3,750 2025 3,750 2026 28,750 Thereafter 353,437 Total debt 397,187 Unamortized discounts (9,953) Total debt, net of unamortized discounts $ 387,234 Loan Agreement —On December 31, 2020, the Company’s senior secured loan agreement consisted of a senior secured first lien term loan facility of $140 million and a first lien revolving credit facility of up to $50 million. As of December 31, 2020, there were $2.1 million of outstanding letters of credit that reduced the Company’s availability under the revolving credit facility. As of December 31, 2021 and December 31, 2020, term loan borrowings were $362.2 million and $131.8 million, respectively, net of debt issuance costs of $10.0 million and $4.7 million, respectively. There were $25.0 million and $47.9 million of borrowings under the revolving credit facility as of December 31, 2021 and December 31, 2020, respectively. Additionally, as of December 31, 2021 and December 31, 2020, the Company’s unamortized debt issuance costs related to the revolving credit facility were $1.8 million and $1.7 million, respectively, which are included in other assets in the condensed consolidated balance sheet. In connection with the closing of the Wholesome Transaction, on February 5, 2021, further discussed in Note 2, the Company and certain of its subsidiaries entered into an amendment and restatement agreement (the “Amendment Agreement”) with Toronto Dominion (Texas) LLC, which amended and restated its existing senior secured loan agreement dated as of June 25, 2020 (as amended on September 4, 2020, the “Existing Credit Agreement,” and as further amended by the Amendment Agreement, the “Amended and Restated Credit Agreement”), by and among Toronto Dominion (Texas), LLC, as administrative agent, certain lenders signatory thereto and certain other parties. The Amended and Restated Credit Agreement provides for senior secured financing consisting of the following credit facilities: (a) a senior secured term loan facility in the aggregate principal amount of $375 million (the “Term Loan Facility”); and (b) a revolving credit facility in an aggregate principal amount of up to $75 million (the “Revolving Facility,” and together with the Term Loan Facility, the “Credit Facilities”). The Revolving Facility has a $15 million sub-facility for the issuance of letters of credit and a $15 million sublimit for swing line loans. The Company used the proceeds under the Term Loan Facility to (i) repay and refinance existing indebtedness of WSO Investments; (ii) pay the cash consideration for the Wholesome Transaction; (iii) repay and refinance outstanding borrowings under the Existing Credit Agreement; and (iv) pay fees and expenses incurred in connection with the foregoing. The proceeds of the Revolving Facility can be used to finance working capital needs, for general corporate purposes, and for working capital adjustments payable under the Wholesome Purchase Agreement. Loans outstanding under the Credit Facilities accrue interest at a rate per annum equal to (i) with respect to the Revolving Facility and letters of credit, (A) 2.75%, in the case of base rate advances, and (B) 3.75% in the case of LIBOR advances, and (ii) with respect to the Term Loan Facility, (A) 3.50%, in the case of base rate advances, and (B) 4.50% in the case of LIBOR advances, with a LIBOR floor of 1.00% with respect to the Term Loan Facility, and 0.00% with respect to the Revolving Facility and letters of credit, and base rate based on the highest of the prime rate, the federal funds rate plus 0.50%, LIBOR for a one-month interest period plus 1.00%, and with respect to the Revolving Facility and letters of credit, 0.00%, or with respect to the Term Loan Facility, 2.00%, and undrawn amounts under the Revolving Facility will accrue a commitment fee at a rate per annum equal to 0.50% on the average daily undrawn portion of the commitments thereunder. As of December 31, 2021, there were $2.1 million of outstanding letters of credit that reduced the Company’s availability under the revolving credit facility. The obligations under the Credit Facilities are guaranteed by certain direct or indirect wholly-owned domestic subsidiaries of the Company, other than certain excluded subsidiaries, including, but not limited to, immaterial subsidiaries and foreign subsidiaries. The Credit Facilities are secured by substantially all of the personal property of the Company and the guarantor subsidiaries (in each case, subject to certain exclusions and qualifications). The Credit Facilities require the Company to make certain mandatory prepayments, with (i) 100% of net cash proceeds of all non-ordinary course asset sales or other dispositions of property in excess of $5 million in any fiscal year, subject to the ability to reinvest such proceeds and certain other exceptions, (ii) 100% of the net cash proceeds of any debt incurrence, other than debt permitted under the definitive agreements (but excluding debt incurred to refinance the Credit Facilities) and (iii) 50% of “Excess Cash Flow,” as defined in the Amended and Restated Credit Agreement, with a reduction to 25% if the total net leverage ratio for the fiscal year is less than or equal to 3.50 to 1.00 but greater than 3.00 to 1.00, and a reduction to 0% if the total net leverage ratio for the fiscal year is less than or equal to 3.00 to 1.00. The Company also is required to make quarterly amortization payments equal to 0.25% per annum of the original principal amount of the Term Loan Facility (subject to reductions by optional and mandatory prepayments of the loans). As of the date of the amendment of the credit facilities, the aggregate unamortized debt issuance costs totaled $6.2 million, of which $4.4 million was expensed as a loss on extinguishment of debt. Additionally, in connection with the Amended and Restated Credit Agreement, the Company paid fees to certain lenders of $3.8 million, which was considered a debt discount, all of which was deferred, and incurred transaction costs of $8.9 million, of which $7.8 million was deferred and $1.1 million was expensed as part of loss on extinguishment and debt transaction costs. |
WARRANTS
WARRANTS | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities [Abstract] | |
WARRANTS | NOTE 8: WARRANTS As of the date of the Business Combination, the Company had approximately 20,263,500 warrants outstanding, consisting of (i) 15,000,000 public warrants originally sold as part of the units issued in Act II’s initial public offering (the “Public Warrants”) and (ii) 5,263,500 Private Warrants that were sold by Act II to the PIPE Investors in conjunction with the Business Combination (collectively with the Public Warrants, the “Warrants”). Each warrant is exercisable for one-half of one share of the Company’s common stock at a price of $11.50 per whole share, subject to adjustment. Warrants may only be exercised for a whole number of shares as no fractional shares will be issued. As of December 31, 2021 and December 31, 2020, the Company had 18,929,880 and 15,982,520 Public Warrants outstanding, respectively, and 1,333,420 and 4,280,980 Private Warrants outstanding, respectively. The exercise price and number of ordinary shares issuable upon exercise of the Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. If the number of shares of Common Stock purchasable upon the exercise of the Warrants is adjusted, the Warrant price shall be adjusted proportionally. In no event will the Company be required to net cash settle the Warrants. Additionally, the Warrants became exercisable as of July 27, 2020 and expire five years from the date of the Business Combination or earlier upon redemption or liquidation. There were 200 Warrants exercised for 100 shares of the Company’s common stock as of December 31, 2021. Public Warrants —The Public Warrants are subject to redemption by the Company: • in whole and not in part; • at a price of $0.01 per public warrant; • upon not less than 30 days’ prior written notice of redemption to each warrant holder; and • if, and only if, the reported last sale price of the ordinary shares for any 20 trading days within a 30-day trading period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders equals or exceeds $18 per share (as adjusted). The Company may not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those ordinary shares is available throughout the 30-day redemption period. If any such registration statement does not remain effective after closing of the Business Combination, the Company has the right to redeem the warrants on a “cashless” exercise basis. The public warrant holders only have the right to exercise their warrants pursuant to a “cashless” exercise if the Company does not maintain an effective registration statement. Private Warrants —The Private Warrants are identical to the Public Warrants, except that so long as they are held by the PIPE Investors or any permitted transferees, as applicable, the Private Warrants: (i) may be exercised for cash or on a cashless basis, (ii) were not allowed to be transferred, assigned or sold until thirty (30) days after the closing of the Business Combination, and (iii) shall not be redeemable by the Company. Upon the transfer of a Private Warrant to a party other than a PIPE Investor or a permitted transferee, the Private Warrants become Public Warrants and the fair market value of the Private Warrants at the date of transfer is reclassified to equity. See Note 1 for additional discussion. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 9: FAIR VALUE OF FINANCIAL INSTRUMENTS The Company measures and records in its consolidated and combined financial statements certain assets and liabilities at fair value. ASC Topic 820 “Fair Value Measurement and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). This hierarchy consists of the following three levels: • Level 1 – Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market. • Level 2 – Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets; or valuation models whose inputs are observable or unobservable but corroborated by market data. • Level 3 – Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable inputs that are significant to the overall fair value measurement. Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Current Assets and Other Financial Assets and Liabilities— Cash and cash equivalents, trade accounts receivable and trade accounts payable are measured at carrying value, which approximates fair value because of the short-term maturities of these instruments. Contingent Consideration Payable— The Company measures the contingent consideration payable at fair value. The fair value of the contingent consideration utilized Level 3 inputs as it is based on significant inputs not observable in the market as of December 31, 2021, such as projected financial information and discount rate. Debt— The Company measures its term loan and revolving facilities at original carrying value including accrued interest, net of unamortized deferred financing costs and fees. The fair value of the credit facilities approximates carrying value, as they consist of variable rate loans. Warrant Liabilities —The Company classifies its Private Warrants as liabilities in accordance with ASC Topic 815. The Company estimates the fair value of the Private Warrants using a Black-Scholes options pricing model. The fair value of the Private Warrants utilized Level 3 inputs as it is based on significant inputs not observable in the market as of December 31, 2021. The fair value of the Private Warrants was estimated at December 31, 2021 using a Black-Scholes options pricing model and the following assumptions: Input December 31, 2021 Asset price $ 10.74 Exercise price $ 11.50 Risk-free interest rate 1.04 % Expected volatility 41.0 % Expected term (years) 3.49 Dividend yield 0.0 % The fair value of warrant liabilities as of December 31, 2021 was $2.1 million. The changes in the warrant liabilities during the year ended December 31, 2021 were as follows (in thousands): Reclassification of fair value of Private Warrants to warrant liabilities as of January 1, 2021 $ 8,139 Cumulative impact of change in fair value of Private Warrants in 2020 (1,161) Transfer of Private Warrants to Public Warrants (6,057) Change in fair value of warrant liabilities in 2021 1,132 Fair value of warrant liabilities as of December 31, 2021 $ 2,053 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10: COMMITMENTS AND CONTINGENCIES The Company is subject to various claims, pending and possible legal actions for product liability and other damages, and other matters arising out of the conduct of the business. The Company believes, based on current knowledge and consultation with counsel, that the outcome of such claims and actions will not have a material adverse effect on the Company’s consolidated and combined financial position or results of operations. As of December 31, 2021, the Company had obligations to purchase approximately $60.9 million of raw material during 2022. In addition, the Company had commitments under purchase obligations related to market data research and technology services totaling approximately $6.1 million, of which $3.2 million was short-term and $2.9 million was long-term. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 11: INCOME TAXES For the Successor period, the Company’s provision for income taxes consists of U.S., state and local, and foreign taxes. The Company has significant operations in various locations outside the U.S. The annual effective tax rate is a composite rate reflecting the earnings in the various locations at their applicable statutory tax rates. For the Predecessor period, income taxes as presented herein attribute current and deferred income taxes of the Company’s financial statements in a manner that is systematic, rational, and consistent with the asset and liability method described by ASC 740, “Income Taxes.” Accordingly, the Company’s income tax provision during the predecessor period was prepared following the separate return method. The separate return method applies ASC 740 to the stand-alone financial statements of each member of the combined group as if the group member were a separate taxpayer and a stand-alone enterprise. Use of the separate return method may result in differences when the sum of the amounts allocated to stand-alone tax provisions are compared with amounts presented in the combined financial statements. In that event, the related deferred tax assets and liabilities could be significantly different from those presented herein. The combined financial statements reflect the Company’s portion of income taxes payable as if the Company had been a separate taxpayer. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was enacted in response to the COVID-19 pandemic. Under ASC 740, the effects of changes in tax rates and laws are recognized in the period in which the new legislation is enacted. The CARES Act made various tax law changes including among other things (i) increased the limitation under IRC Section 163(j) for 2019 and 2020 to permit additional expensing of interest (ii) enacted a technical correction so that qualified improvement property can be immediately expensed under IRC Section 168(k) (iii) made modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years in order to generate a refund of previously paid income taxes and (iv) enhanced recoverability of alternative minimum tax credit carryforwards. The income tax provisions of the CARES Act had limited applicability to the Company and did not have a material impact on the Company’s consolidated and combined financial statements. Components of the income tax (benefit) provision were as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Current: Federal $ 916 $ (969) $ 51 $ 1,972 State and local 283 54 16 197 Foreign 3,957 1,139 2,029 5,865 5,156 224 2,096 8,034 Deferred: Federal (6,498) (2,192) (4,262) (1,802) State and local (2,801) 138 (259) 336 Foreign (3,001) (788) (1,057) (9,034) (12,300) (2,842) (5,578) (10,500) Total benefit for income taxes $ (7,144) $ (2,618) $ (3,482) $ (2,466) The following is a reconciliation of income tax (benefit) provision computed at the U.S. federal statutory rate to income tax benefit in the consolidated and combined statements of operations (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 (Loss) income before income taxes: Domestic $ (36,205) $ (18,981) $ (49,477) $ 10,859 Foreign 29,144 7,926 11,859 17,487 Total (loss) income before income taxes $ (7,061) $ (11,055) $ (37,618) $ 28,346 Federal income tax rate 21.0% 21.0% 21.0% 21.0% Federal income taxes $ (1,483) $ (2,322) $ (7,900) $ 5,953 State and local taxes (3,572) 1,812 (278) 426 Foreign rate differential (1,431) (70) (125) 789 Change in tax rates 225 735 — (2,209) Change in uncertain tax positions (1,005) 40 (651) 64 Change in valuation allowance 2,657 (1,474) 883 588 Goodwill impairment — — 3,717 — Impact of Luxembourg restructuring — — — (6,438) U.S. effects of international operations 3,041 320 2,084 3,079 Tax credits (2,763) (2,161) (1,201) (5,233) Section 162(m) limitation 206 — — — Transaction costs 385 — — — Stock-based compensation 502 — — — Switzerland tax ruling (4,057) — — — Foreign withholding taxes 350 — — — Other (199) 502 (11) 515 Total benefit for income taxes $ (7,144) $ (2,618) $ (3,482) $ (2,466) Effective tax rate 101.2% 23.7% 9.3% (8.7)% Significant components of the Company’s net deferred tax assets and liabilities were as follows (in thousands): December 31, 2021 December 31, 2020 Deferred tax assets: Accounts receivable $ 381 $ 473 Accrued expenses 5,251 3,838 Inventory 6,166 5,231 Other assets 930 160 Pension asset 365 348 Lease accounting 7,558 3,360 U.S. and foreign net operating losses 17,433 13,998 Deferred interest expense 6,106 — Tax credits 511 254 Total deferred tax assets 44,701 27,662 Less valuation allowance (12,184) (9,879) Net deferred tax assets $ 32,517 $ 17,783 Deferred tax liabilities: Property, plant and equipment (5,271) (4,678) Operating lease right-of-use asset (6,553) (2,747) Intangible assets (46,511) (24,266) Deferred rent (59) (78) Unremitted earnings (965) (719) Other liabilities (6,255) (5,921) Total deferred tax liabilities (65,614) (38,409) Net deferred tax liability $ (33,097) $ (20,626) In assessing the recoverability of its deferred tax assets within the jurisdiction from which they arise, management considers whether it is more likely than not (more than 50%) that some portion or all of the deferred tax assets will be realized. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income prior to the expiration of any net operating loss and tax credit carry forwards. The Company evaluates all positive and negative evidence when determining the amount of the net deferred tax assets that are more likely than not to be realized. This evidence includes, but is not limited to, prior earnings history, reversal of taxable temporary differences, tax planning strategies and projected future taxable income. Significant weight is given to positive and negative evidence that is objectively verifiable. Based on the weight of available evidence, including the scheduling of taxable temporary differences into future taxable income, the Company determined that as of December 31, 2021 its deferred tax assets were realizable on a more-likely-than not basis with the exception of foreign tax credits of $0.5 million, certain state net operating loss carry forwards of $9.3 million predominately related to Illinois, and $2.4 million of net operating loss carry forwards in India, Luxembourg, Spain, Mexico and China. The Company’s valuation allowance increased by approximately $2.3 million, of which $2.7 million was charged to income tax expense in 2021 (as shown in the rate reconciliation table above), partially offset by foreign exchange translation adjustments. The Company received a beneficial Switzerland tax ruling in 2021 permitting a step up in the tax basis of intangible assets. The Company will be able to amortize the intangible assets over a 10-year period for Swiss tax purposes, resulting in future cash tax savings. The Company recognized a discrete tax benefit of $4.1 million in 2021 related to this change. As of December 31, 2021, the Company had net operating loss carry forwards and tax credits which will expire if not utilized, including: $121.9 million in Illinois state net operating losses expiring between 2029 and 2041, $0.5 million of U.S. federal foreign tax credits expiring in 2030 through 2031, $1.6 million of net operating losses in Mexico substantially expiring in 2023 and through 2031, $5.9 million of net operating losses in Luxembourg substantially expiring in 2035 and through 2038, $2.2 million of net operating losses in India expiring in 2022 through 2028, and $1.0 million of net operating losses in China expiring in 2022 through 2026. Notwithstanding the current taxation of certain foreign subsidiaries under GILTI and one-time transition taxation enacted as part of the Tax Cut and Jobs Act, the Company intends to continue to invest these earnings indefinitely outside the U.S. If these future earnings are repatriated to the U.S., or if the Company determines that such earnings will be remitted in the foreseeable future, the Company may be required to accrue U.S. deferred taxes (if any) and applicable withholding taxes. It is not practicable to estimate the tax impact of the reversal of the outside basis difference, or the repatriation of cash due to the complexity of its hypothetical calculation. As of December 31, 2021 and 2020, the Company had accrued future income taxes and withholding taxes for future remittances to its Switzerland and Hong Kong affiliates of $1.8 million and $1.7 million, respectively. The following summarizes the changes in the Company’s liability for unrecognized tax positions (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Beginning of period $ 609 $ 539 $ 895 Lapse in statute of limitations (507) — (291) Currency differences (8) 70 (65) End of period $ 94 $ 609 $ 539 The unrecognized tax benefits in both the successor and predecessor periods include amounts related to various foreign tax issues. The Company records both accrued interest and penalties related to income tax matters in the provision for income taxes in the accompanying consolidated and combined statements of operations. The Company’s accrued interest and penalties related to uncertain tax positions totaled $0.1 million, $0.6 million, and $0.4 million as of December 31, 2021, December 31, 2020, and June 25, 2020, respectively. Of the amounts reflected in the table above as of December 31, 2021, the entire amount if recognized, would reduce the Company’s effective tax rate. The Company does not expect its unrecognized tax benefits will significantly increase or decrease in the next 12 months. The Company is subject to taxation in the U.S. and various state and foreign jurisdictions. The Company’s U.S. federal and state income tax periods are generally open to examination for the tax years 2017 through 2021. The Company’s French, Argentina, Luxembourg and Swiss tax years 2016 through 2021 also remain open for examination. In addition, open tax years related to the Company’s other foreign jurisdictions remain subject to examination but are not considered material. |
PENSION AND OTHER RETIREMENTS B
PENSION AND OTHER RETIREMENTS BENEFITS | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
PENSION AND OTHER RETIREMENTS BENEFITS | NOTE 12: PENSION AND OTHER RETIREMENT BENEFITS Certain current and former employees of the Company are covered under a funded qualified defined benefit retirement plan. Plan provisions covering certain of the Company’s salaried employees generally provide pension benefits based on years of service and compensation. Plan provisions covering certain of the Company’s union members generally provide stated benefits for each year of credited service. The Company’s funding policy is to contribute annually the statutory required amount as actuarially determined. The Company froze the pension plan on December 31, 2019. In addition, the Company has unfunded non-qualified plans covering certain salaried employees with additional retirement benefits in excess of qualified plan limits imposed by federal tax law. The Company uses December 31 as a measurement date for the plans. In February 2021, the Compensation Committee approved the termination of the Company’s qualified defined benefit retirement plan at Flavors & Ingredients. During the fourth quarter of 2021, the Company offered the option of receiving a lump sum payment to certain participants with vested benefits in lieu of receiving monthly annuity payments. Approximately 125 participants elected to receive the settlement, and lump sum payments of approximately $16.8 million were paid from plan assets to these participants in December 2021. The benefit obligation settled approximated payments to plan participants and a pre-tax settlement gain of $0.5 million was recorded in the fourth quarter of 2021. On February 11, 2022, the Company purchased non-participating annuity contracts to settle the remaining liabilities of the plan for approximately $9.5 million which was fully funded by plan assets. The annuity contracts purchased will result in a settlement gain of approximately $0.9 million that will be recorded in the first quarter of 2022. The remaining surplus of the plan will be used, as prescribed in the applicable regulations, to fund future contributions to the defined contribution plan at Flavors & Ingredients. The following table reconciles the funded status of the Company’s defined benefit pension plans (Successor) From June 26, 2020 to (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Accumulated benefit obligations $ 20,314 $ 41,112 $ 39,792 Changes in projected benefit obligations: Projected benefit obligations at beginning of year $ 41,112 $ 39,879 $ 37,854 Service cost 63 94 41 Interest cost 1,047 545 593 Actuarial (gain) loss (1,054) 1,568 1,826 Benefits paid (20,854) (974) (435) Projected benefit obligations at end of year 20,314 41,112 39,879 Change in plans’ assets: Fair value of plans’ assets at beginning of year 33,058 30,674 30,213 Actual returns on plans’ assets 372 3,195 732 Employee contributions 326 163 163 Benefits paid (20,854) (974) (434) Fair value of plans’ assets at end of year 12,902 33,058 30,674 Net pension liability $ (7,412) $ (8,054) $ (9,205) The projected benefit obligation at December 31, 2021 and December 31, 2020 included $9.8 million and $10.3 million, respectively, related to the Company’s unfunded non-qualified plans. Amounts recognized in the Company’s consolidated and combined balance sheets consisted of (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Other assets $ 2,367 $ 2,238 $ 512 Accrued expenses and other current liabilities (488) (374) (373) Other liabilities (9,291) (9,918) (9,344) Net amount recognized $ (7,412) $ (8,054) $ (9,205) Amounts recognized in accumulated other comprehensive income (loss), net of tax, which have not yet been recognized as a component of net periodic pension expense for the Company’s funded defined benefit pension plans, are as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Prior service cost $ — $ — $ 169 Net actuarial (gain) loss (207) (620) 13,997 $ (207) $ (620) $ 14,166 As a result of the Business Combination on June 25, 2020, unamortized amounts previously charged to accumulated other comprehensive income (loss) were eliminated. The components of the changes in unrecognized amounts included in pension obligation, net in other comprehensive income (loss) for the Company’s defined benefit pension plans were as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Net actuarial loss $ 527 $ — $ 1,912 Amortization of prior service costs — — (33) Amortization of actuarial loss (36) — (276) Total loss recognized in other comprehensive income $ 491 $ — $ 1,603 The components of net periodic benefit (credit) cost for the Company’s defined benefit pension plans for the Successor and Predecessor were as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Service cost $ 63 $ 94 $ 41 $ 692 Interest cost 1,047 545 593 1,410 Expected return on plan assets (1,310) (783) (817) (1,462) Amortization of prior service cost — — 33 149 Amortization of net actuarial loss 36 — 276 1,332 Settlement/curtailment (income) expense (644) (25) — 317 Net periodic benefit (credit) cost $ (808) $ (169) $ 126 $ 2,438 Net periodic benefit (credit) cost is reflected in the Company’s consolidated and combined financial statements as follows for the Successor and Predecessor periods presented (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Cost of goods sold $ — $ — $ — $ 614 Selling, general and administrative expense 63 69 41 1,824 Other income (expense), net (871) (238) 85 — Net periodic benefit (credit) cost $ (808) $ (169) $ 126 $ 2,438 Assumptions —The following assumptions were used to determine the benefit obligation at year end and net periodic benefit (credit) cost during the year for the Company’s funded defined benefit pension plan: (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Weighted-average assumptions used to determine benefit obligation at year end: Discount rate (1) 2.38 % 2.61 % 2.85 % Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 2.61 % 2.85 % 3.25 % Expected long-term rate of return on plan assets 4.90 % 5.25 % 5.50 % (1) The discount rate assumption used to determine the benefit obligation at December 31, 2021 was based on blended 7 year and 15 year duration annuity purchase contracts. The following assumptions were used to determine the benefit obligation at year end and net periodic benefit (credit) cost during the year for the Company’s unfunded supplemental defined benefit pension plan: (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Weighted-average assumptions used to determine benefit obligation at year end: Discount rate 2.78 % 2.42 % 2.64 % Rate of compensation increase 3.50 % 3.50 % 3.50 % Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 2.42 % 2.64 % 3.25 % Rate of compensation increase 3.50 % 3.50 % 3.50 % The Company bases the discount rate assumption on current investment yields of high quality fixed income investments during the retirement benefits maturity period. The rate of increase in future compensation assumptions reflects the Company’s long-term actual experience and future and near-term outlook. The Company considers a number of factors to determine its expected rates of return on the assets in its plan, including, without limitation, historical performance of the plan assets, investment style, asset allocations and other third-party studies and surveys. The Company considered the plan portfolio’s asset allocation over a variety of time periods and compared them with third-party studies and reviewed performance of the capital markets in recent years and other factors and advice from various third parties, such as the pension plan’s advisors, investment managers and actuaries. While the Company considered recent performance and the historical performance of its plan assets, the Company’s assumptions are based primarily on its estimates of long-term, prospective rates of return. Differences between actual and expected asset returns are recognized in the net periodic benefit cost over the remaining service period of the active participating employees. Plan Assets —The investment committee for the Company’s plan adopted investment policies with the objective of meeting and exceeding over time, the expected long-term rate of return on plan assets assumptions, weighted against a reasonable risk level and considering the appropriate liquidity levels. In connection with this objective, in 2021 and 2020 the plan’s assets were mainly invested in mutual funds, common and collective funds, corporate bonds, government bonds, private equity funds, as well as a real estate fund, in order to achieve the Company’s goals to enhance the expected returns of its investments together with their liquidity and protect the plan’s funded status. As a result of the planned termination of the qualified pension plan, certain of the plan’s assets were liquidated during the fourth quarter of 2021 and used to satisfy lump sum benefit payments as further described above. Therefore, at December 31, 2021, the plan’s assets were primarily invested in cash and fixed income securities. The plan had the following target ranges for the asset classes as shown below. The ranges were intended to allow flexibility for allocating assets and rebalancing as needed depending on changes in market values and the investment environment. The strategy utilized was regularly reviewed by the plan’s investment committee, which could have made adjustments to the allocations when allocations fell outside the asset class range. Target Ranges Asset classes: Cash equivalents and other 0% - 17% Fixed income securities 45% - 100% Equity securities 0% - 28% The following tables set forth, by category, the Company’s pension plan assets as of December 31, 2021 and December 31, 2020, using the fair value hierarchy established under ASC Topic 820 and as described in Note 9. The fair value hierarchy in the tables excludes certain investments which are valued using Net Asset Value (“NAV”) as a practical expedient (in thousands): Pension Plan Assets as of December 31, 2021 Level 1 Level 2 Level 3 Total Pension plan assets measured at fair value: Cash and cash equivalents $ 325 $ — $ — $ 325 U.S. Government securities — 6,283 — 6,283 Corporate bonds — 6,283 — 6,283 Total pension plan assets measured at fair value $ 325 $ 12,566 $ — $ 12,891 Pension plan assets measured at NAV as a practical expedient (1) 11 Total pension plan assets $ 12,902 (1) Certain investments in real estate funds that are measured at fair value using the NAV per share practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table above are intended to permit reconciliation of the fair value hierarchy to the total value of plan assets. Pension Plan Assets as of December 31, 2020 Level 1 Level 2 Level 3 Total Pension plan assets measured at fair value: Cash and cash equivalents $ 419 $ — $ — $ 419 Mutual funds 5,374 442 — 5,816 U.S. Government securities — 3,087 — 3,087 Municipal/provincial bonds — 296 — 296 Corporate bonds — 13,408 — 13,408 Total pension plan assets measured at fair value $ 5,793 $ 17,233 $ — $ 23,026 Pension plan assets measured at NAV as a practical expedient (1) 10,032 Total pension plan assets $ 33,058 (1) Certain common/collective trusts, investments in private equity funds and investments in real estate funds that are measured at fair value using the NAV per share practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table above are intended to permit reconciliation of the fair value hierarchy to the total value of plan assets. Cash and cash equivalents are stated at cost, which approximates fair market value. Mutual funds are valued at their net asset value quoted in active markets. Common and collective funds, as well as investments in private equity funds, are valued at net asset value as reported by the fund administrator. Within mutual funds and common and collective funds, the assets are invested in a broad range of publicly traded equity securities and publicly traded debt securities ranging from domestic and international treasury issues, corporate debt securities, government agencies debt securities and mortgage-backed and asset-backed issues, in accordance with the plan’s investment policies. Corporate and government bonds are generally valued on the basis of evaluated bids furnished by a pricing service, which determines valuations for normal, institutional size-trading units of such securities using market information, transactions for comparable securities and various relationships between securities. Exchange traded funds, which are investment portfolios that hold a collection of marketable securities designed to track the performance of a specific index (like the S&P 500), are valued at the market price quoted on the particular stock exchange where they are traded. There were no transfers between levels within the three-tier fair value hierarchy in 2021 and 2020. Contributions —The Company currently does not expect to make further contributions to its funded defined benefit pension plan due to the funded status. Expected Future Benefit Payments —The projected benefit payments for the funded qualified and unfunded non-qualified defined benefit pension plans are as follows (in thousands): Qualified Pension Plan Non-qualified Pension Plans 2022 $ 535 $ 488 2023 515 482 2024 514 497 2025 507 503 2026 501 563 2027-2031 2,572 2,922 The Company also participates in certain state-sponsored defined benefit plans covering certain non-U.S. employees with total net liabilities of $3.6 million and $3.3 million as of December 31, 2021 and December 31, 2020, respectively. The primary state-sponsored plan relates to Merisant employees in Switzerland and France, which had pension benefit obligations of $6.9 million and plan assets of $3.4 million as of December 31, 2021 and a pension benefit obligation of $6.3 million and plan assets of $3.0 million as of December 31, 2020. Net periodic pension cost for 2021, for the period June 26, 2020 through December 31, 2020, January 1, 2020 through June 25, 2020, and 2019 was $0.4 million, $0.2 million, $0.3 million, and $0.3 million, respectively. Defined Contribution Pension Plans —The Company has defined contribution 401(k) plans covering certain eligible domestic employees, as defined by the plans. The plans provide for certain employer matching contributions. The Company recorded compensation expense related to its defined contribution plans of $1.0 million for 2021, $0.2 million for the period from June 26, 2020 to December 31, 2020, and $0.3 million for both the period from January 1, 2020 to June 25 2020 and 2019. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 13: STOCK-BASED COMPENSATION On June 24, 2020, the Whole Earth Brands, Inc. 2020 Long-Term Incentive Plan (the “Plan”) was approved for the purpose of promoting the long-term financial interests and growth of the Company and its subsidiaries by attracting and retaining management and other personnel and key service providers. The Plan provides for the granting of stock options (“SOs”), stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance shares, performance share units (“PSUs”) and other stock-based awards to officers, employees and non-employee directors of, and certain other service providers to, the Company and its subsidiaries. These awards are settled in shares of the Company’s stock and therefore classified as equity awards. Under the terms of the Plan, an aggregate of 9,300,000 shares of common stock are authorized for issuance under the Plan. The RSUs and RSAs are accounted for as equity awards and have a grant-date fair value equal to the fair market value of the underlying stock on the grant date. RSUs granted generally vest ratably on the anniversary of the grant date over a period of one PSU awards generally cliff vest subsequent to the completion of the cumulative three-year performance period, depending on the period specified in each respective PSU agreement. The number of PSUs that ultimately vest depends on the Company’s performance relative to a specified cumulative financial target for fiscal years 2021, 2022 and 2023 (the “cumulative performance target”) and are expected to be settled in stock. Stock-based compensation expense for the year ended December 31, 2021 and for the period from June 26, 2020 to December 31, 2020 was $8.7 million and $1.3 million, respectively. Stock-based compensation expense for the year ended December 31, 2021 includes $0.9 million of expense related to 2021 management bonuses expected to be settled in stock and accounted for as a liability. The tax benefit recognized related to stock-based compensation was $0.5 million for the year ended December 31, 2021. There was no tax benefit recognized related to stock-based compensation for the period from June 26, 2020 to December 31, 2020. A summary of activity and weighted average fair values related to the RSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2020 633,057 $ 8.34 0.88 Granted 576,687 13.48 Vested (582,503) 8.34 Forfeited (142,497) 11.70 Outstanding and nonvested at December 31, 2021 484,744 $ 13.46 1.02 The weighted average grant date fair value per share of RSUs granted during the year was $13.48 in 2021 and $8.34 for the period from June 26, 2020 through December 31, 2020. The aggregate fair value of RSUs upon vesting during the year ended December 31, 2021 was $7.2 million. No RSUs vested during the period from June 26, 2020 to December 31, 2020. A summary of activity and weighted average fair values related to the RSAs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2020 68,946 $ 8.34 1.33 Granted 48,855 11.77 Outstanding and nonvested at December 31, 2021 117,801 $ 9.76 0.98 The weighted average grant date fair value per share of RSAs granted during the year was $11.77 in 2021 and $8.34 for the period from June 26, 2020 through December 31, 2020. A summary of activity and weighted average fair values related to the PSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2020 — $ — — Granted 323,555 13.65 Forfeited (41,414) 13.65 Outstanding and nonvested at December 31, 2021 282,141 $ 13.65 2.21 As of December 31, 2021, the Company had not yet recognized compensation cost on nonvested awards as follows (in thousands): Unrecognized Weighted Avg. Nonvested awards $ 7,694 1.4 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 14: STOCKHOLDERS' EQUITY Common Stock Repurchase Plan —On September 8, 2020, the Company announced that its board of directors had authorized a stock repurchase plan of up to $20 million of shares of the Company’s common stock. The shares were available for repurchase from time to time over a 12-month period which expired on September 15, 2021, in open market transactions at prevailing market prices, in privately negotiated transactions, or by other means in accordance with U.S. federal securities laws. There were no repurchases of the Company’s common stock under the stock repurchase plan. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 15: EARNINGS PER SHARE Basic earnings (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Warrants issued are not considered outstanding at the date of issuance. RSUs and RSAs also are not considered outstanding until they have vested. Contingently issuable shares associated with outstanding PSUs that have cliff vesting based on achievement of a performance condition were not included in the basic earnings per share calculations for the periods presented as the applicable vesting conditions had not been satisfied. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average shares outstanding assuming dilution. Dilutive common shares outstanding is computed using the treasury stock method and reflects the additional shares that would be outstanding if dilutive warrants were exercised and restricted stock units and restricted stock awards were settled for common shares during the period. For warrants that are liability-classified, during the periods when the impact would be dilutive, the Company assumes share settlement of the instruments as of the beginning of the reporting period and adjusts the numerator to remove the change in the fair value of warrant liability and adjusts the denominator to include the dilutive shares using the treasury stock method. The computation of basic and diluted earnings (loss) per common share for the year ended December 31, 2021 and the period from June 26, 2020 to December 31, 2020 is shown below (in thousands, except for share and per share data): Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 EPS numerator: Net income (loss) attributable to common shareholders $ 83 $ (8,437) Less: Change in fair value of warrant liabilities (29) — Numerator - diluted $ 54 $ (8,437) EPS denominator: Weighted average shares outstanding - basic 38,505,458 38,426,669 Effect of dilutive securities 1,370,929 — Weighted average shares outstanding - diluted 39,876,387 38,426,669 Net earnings (loss) per share: Basic $ 0.00 $ (0.22) Diluted $ 0.00 $ (0.22) For the period from June 26, 2020 to December 31, 2020, 20,263,500 warrants, 633,057 RSUs and 68,946 RSAs were excluded from the diluted earnings per share calculation because they were determined to be anti-dilutive. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Dec. 31, 2021 | |
AOCI Attributable to Parent [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | NOTE 16: ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table summarizes accumulated other comprehensive income (loss) (“AOCI”), net of taxes, by component (in thousands): Net Currency Funded Status of Benefit Plans Total Balance at December 31, 2019 (Predecessor) $ 2,885 $ (10,944) $ (8,059) Other comprehensive loss before reclassifications (2,286) — (2,286) Amounts reclassified from AOCI — 318 318 Balance at June 25, 2020 (Predecessor) $ 599 $ (10,626) $ (10,027) Purchase accounting adjustments to eliminate Predecessor’s accumulated other comprehensive (loss) income (599) 10,626 10,027 Balance at June 26, 2020 (Successor) $ — $ — $ — Other comprehensive income before reclassifications 7,774 856 8,630 Amounts reclassified from AOCI — (25) (25) Balance December 31, 2020 (Successor) $ 7,774 $ 831 $ 8,605 Other comprehensive income before reclassifications 984 701 1,685 Amounts reclassified from AOCI — (603) (603) Balance December 31, 2021 (Successor) $ 8,758 $ 929 $ 9,687 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 17: RELATED PARTY TRANSACTIONS The Predecessor participated in MacAndrews & Forbes’ (“MacAndrews”) directors and officer’s insurance program, which covered the Predecessor along with MacAndrews and its other affiliates. The limits of coverage were available on aggregate losses to any or all of the participating companies and their respective directors and officers. For the period of January 1, 2020 to June 25, 2020 and the year ended December 31, 2019, the Predecessor reimbursed MacAndrews an immaterial amount for its allocable portion of the premiums for such coverage, which the Predecessor believed was more favorable than the premiums that it could have secured were it to secure its own coverage. The Predecessor also participated in certain other insurance programs with MacAndrews under which it paid premiums directly to the insurance broker. In March 2018, the Predecessor entered into a revolving credit agreement with Wesco US LLC, an indirect and wholly-owned subsidiary of Merisant. This revolving credit facility, as amended, had a maturity date of January 3, 2022 and provided for maximum outstanding borrowings of up to $9.0 million. The revolving credit facility was unsecured and bore interest at 3-month LIBOR plus 4.0% and provided for periodic interest payments with all principal due upon maturity. MacAndrews had the right to accept or reject any borrowing request made by the Predecessor pursuant to the revolving credit agreement in its sole discretion. The outstanding balance on the revolving credit agreement at June 25, 2020 was $3.4 million and was forgiven by MacAndrews in connection with the Business Combination. Interest expense for the period from January 1, 2020 to June 25, 2020 and for the year ended December 31, 2019 was approximately $0.2 million and $0.5 million, respectively. In July 2020, the Company entered into an agreement with Watermill Institutional Trading LLC, a registered broker-dealer (“Watermill”), to act as one of the Company’s financial advisors for a 12-month period commencing July 22, 2020 for total consideration of $0.9 million, of which $0.5 million and $0.4 million was expensed during the year ended December 31, 2021 and the period from June 26, 2020 to December 31, 2020, respectively. Additionally, under the terms of the agreement, the Company incurred additional expense of $2.0 million during the year ended December 31, 2021 related to services provided by Watermill in connection with the acquisition of Wholesome and $0.8 million during the period from June 26, 2020 to December 31, 2020 related to services provided in connection with the acquisition of Swerve. A former director of Act II is a registered representative of Watermill and is providing services directly to the Company under the agreement. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | NOTE 18: BUSINESS SEGMENTS The Company has two reportable segments: Branded CPG and Flavors & Ingredients. In addition, beginning with the first quarter of 2021, the Company’s corporate office functions are now reported and included under Corporate. Corporate is not a reportable or operating segment but is included for reconciliation purposes and includes the costs for the corporate office administrative activities as well as transaction-related and other costs. Certain prior year amounts have been reclassified to conform to the current presentation. The Company does not present assets by reportable segments as they are not reviewed by the Chief Operating Decision Maker for purposes of assessing segment performance and allocating resources. The following table presents selected financial information relating to the Company’s business segments (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Product revenues, net Branded CPG $ 389,174 $ 96,857 $ 80,749 $ 165,863 Flavors & Ingredients 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 Operating income (loss) Branded CPG $ 34,918 $ 13,463 $ (5,055) $ 19,800 Flavors & Ingredients 21,860 (2,645) (23,718) 19,396 56,778 10,818 (28,773) 39,196 Corporate (33,962) (16,924) (9,408) (9,520) Total operating income (loss) $ 22,816 $ (6,106) $ (38,181) $ 29,676 The following table presents geographic information based upon revenues of the Company’s major geographic markets (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 North America $ 318,958 $ 63,386 $ 54,253 $ 104,788 Europe 96,013 45,608 42,776 93,508 India, Middle East and Africa 14,801 6,996 3,959 12,888 Asia-Pacific 51,598 24,350 20,834 46,845 Latin America 12,603 6,828 6,506 14,094 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 The Company has a large and diverse customer base, which includes numerous customers located in foreign countries. Branded CPG’s combined sales to a single customer accounted for 10.6% of total sales in 2021. No single unaffiliated customer accounted for more than 10% of total sales in 2020. With the exception of the United States, no one country represented more than 10% of the Company’s net sales. The Company has an exclusive supply contract to purchase the output of licorice extract and certain licorice derivatives from a manufacturer with facilities in Uzbekistan. For the year ended December 31, 2021, the Company’s purchases from this supplier totaled approximately $15.6 million, representing 41.8% of the Company’s licorice raw materials purchases for the year. Long-lived assets are as follows (in thousands): December 31, 2021 December 31, 2020 Long-Lived Assets* United States $ 24,327 $ 14,798 China 15,620 14,207 Czech Republic 6,074 6,070 France 11,353 11,076 Other Foreign Countries 1,129 1,134 Total $ 58,503 $ 47,285 |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation —The consolidated and combined financial statements include the accounts of Whole Earth Brands, Inc., and its indirect and wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated and combined financial statements and accompanying notes. Actual results could differ from these estimates. |
Reclassifications | Reclassifications —Certain previously reported amounts have been reclassified to conform to the current presentation. |
Cash and Cash Equivalents | Cash and Cash Equivalent s—The Company considers all cash on hand, money market funds, and other highly liquid debt instruments with a maturity, when purchased, of three months or less to be cash and cash equivalents. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts —Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable losses in its existing accounts receivable based on historical losses and current economic conditions. Account balances are charged against the allowance when the Company believes it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Recoveries of accounts receivable previously offset against the allowance are recorded in the combined statements of operations when received. |
Inventories | Inventories —Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predicable costs of completion, disposal, and transportation. The cost of inventory is determined principally by the first in, first out method. |
Property, Plant and Equipment | Property, Plant and Equipment —Property, plant and equipment are recorded at cost. Additions, improvements, and replacements that extend asset life are capitalized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of the Company’s property, plant and equipment in service currently ranges as follows: 3 to 40 years for buildings and 1 to 20 years for all other equipment. When property and equipment are disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gains or losses are included in income from operations. Ordinary repairs and maintenance costs are charged to operating expense as incurred. |
Deferred Software Costs | Deferred Software Costs—Deferred implementation costs for hosted cloud computing service arrangements are stated at historical cost and amortized on a straight-line basis over the term of the hosting arrangement that the implementation costs relate to. Deferred implementation costs are included in other assets and amortized to selling, general and administrative expenses (“SG&A”). The corresponding cash flows related to deferred software costs will be reported within operating activities consistent with the treatment for payments associated with the service component of the hosting arrangement. The Company reviews the deferred implementation costs for impairment when it believes the deferred costs may no longer be recoverable. |
Leases | Leases —As of the date of the Business Combination, the Company accounts for leases pursuant to Accounting Standards Codification (“ASC”) Topic 842, “Leases.” Under ASC Topic 842, a right-of-use asset and a lease liability is recorded for all leases with a term greater than 12 months. Lease right-of-use assets and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using our incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. The Company’s lease portfolio includes a factory building, office space, warehouses, material handling equipment, vehicles and office equipment. All of our leases are classified as operating leases. |
Goodwill and Other Indefinite-Lived Intangible Assets | Goodwill and Other Indefinite-Lived Intangible Assets —Goodwill and other indefinite-lived intangible assets are summarized in Note 6. The Company reviews goodwill and other indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an asset may be impaired, in accordance with ASC Topic 350, “Intangibles—Goodwill and Other.” Under ASC Topic 350, the impairment review of goodwill and other intangible assets not subject to amortization must be based on estimated fair values. The Company’s annual impairment review measurement date is in the fourth quarter of each year. In performing the annual assessment, the Company has the option of performing a qualitative assessment to determine if it is more likely than not that a reporting unit has been impaired. As part of the qualitative assessment for the reporting units, the Company evaluates the factors that are specific to the reporting units as well as industry and macroeconomic factors (including changes in interest and discount rates). The reporting unit specific factors may include cost factors, a comparison of current year results to prior year, current year budget and future projected financial performance. The Company also considers the change in the overall enterprise value of the Company compared to the prior year. If the Company determines that it is more likely than not that a reporting unit is impaired or if the Company elects not to perform the optional qualitative assessment, a quantitative assessment is performed utilizing both the income and market approaches to estimate the fair value of its reporting units. The income approach involves discounting future estimated cash flows. The discount rate used is the value-weighted average of the reporting unit’s estimated cost of equity and debt (“cost of capital”) derived using both known and estimated customary market metrics adjusted for company specific risks. The Company performs sensitivity tests with respect to growth rates and discount rates used in the income approach. In applying the market approach, valuation multiples are derived from historical and projected operating data of selected guideline companies; evaluated and adjusted, if necessary, based on the strengths and weaknesses of the reporting unit relative to the selected guideline companies; and applied to the appropriate historical and/or projected operating data to arrive at an indication of fair value. The Company typically weights the results of the income and market approaches equally. If the reporting unit’s carrying value exceeds its estimated fair value, then an impairment is recorded for the difference, limited to the total amount of goodwill allocated to the reporting unit. |
Impairment Review of Long-Lived Assets | Impairment Review of Long-Lived Assets —In accordance with ASC Topic 360, “Property, Plant and Equipment,” the Company evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may be impaired. When such events occur, the Company compares the sum of the future undiscounted cash flows expected to be generated from the asset or asset group over its remaining depreciable life to the carrying value. If this comparison indicates that there is an impairment, the carrying amount of the long-lived asset would then be reduced to the estimated fair value, which generally approximates discounted cash flows. The Company also evaluates the amortization periods of assets to determine whether events or circumstances warrant revised estimates of useful lives. The Company’s applicable long-lived assets include its property, plant and equipment and definite-lived intangible assets. |
Income Taxes | Income Taxes —The provision for income taxes for the Successor period is determined using the asset and liability method in accordance with ASC Topic 740, “Accounting for Income Taxes.” The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. For the Predecessor period, income taxes as presented herein are attributable to current and deferred income taxes of the Company’s financial statements in a manner that is systematic, rational, and consistent with the asset and liability method described by ASC Topic 740. Accordingly, the Company’s income tax provision during the Predecessor period was prepared following the separate return method. The separate return method applies ASC Topic 740 to the stand-alone financial statements of each member of the combined group as if the group member were a separate taxpayer and a stand-alone enterprise. Use of the separate return method may result in differences when the sum of the amounts allocated to stand-alone tax provisions are compared with amounts presented in the combined financial statements. In that event, the related deferred tax assets and liabilities could be significantly different from those presented herein. The combined financial statements reflect the Company’s portion of income taxes payable as if the Company had been a separate taxpayer. The Company made a policy election to treat the income tax due on United States (“U.S.”) inclusion of the global intangible low taxed income (“GILTI”) provisions as a period expense when incurred. Uncertainty in Income Taxes —The Company accounts for uncertain tax positions in accordance with the authoritative guidance issued under ASC Topic 740, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company provides loss contingencies for federal, state and international tax matters relating to potential tax examination issues, planning initiatives and compliance responsibilities. The development of these reserves requires judgements about tax issues, potential outcomes and timing, which if different, may materially impact the Company’s financial condition and results of operations. The Company classifies interest and penalties associated with income taxes as a component of provision (benefit) for income taxes in the consolidated and combined statements of operations. |
Pension Plans | Pension Plans —The Company has defined benefit pension plans and defined contribution 401(k) plans, which cover certain current and former employees of the Company who meet eligibility requirements. Benefits for the defined benefit pension plans are based on years of service and, in some cases, the employee’s compensation and participation was frozen to all employees hired on or after August 1, 2017. The Company’s policy is to contribute annually the amount required pursuant to the Employee Retirement Income Security Act. The Company froze the pension plan for all participants on December 31, |
Research and Development Costs | Research and Development Costs—The Company expenses costs as incurred for product research and development within SG&A. |
Self-Insurance | Self-Insurance—The Company is self-insured for certain workers’ compensation. Provisions for losses expected under the program are recorded based on the Company’s estimates of the aggregate liabilities for the claims incurred. |
Stock-Based Compensation | Stock-Based Compensation—In accordance with ASC Topic 718, “Compensation—Stock Compensation,” the Company recognizes stock-based compensation cost in its consolidated statements of operations. Stock-based compensation cost is measured at the grant date for equity-classified awards and at the end of each reporting period for liability-classified awards based on the estimated fair value of the awards. The Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. |
Revenue Recognition | Revenue Recognition —In accordance with ASC Topic 606, “Revenue from Contracts with Customers,” the Company recognizes revenue when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenues are primarily derived from customer orders for the purchase of products and are generally recognized when the product is shipped or delivered depending on the arrangement with the customer. The Company made an accounting policy election to exclude from the measurement of the transaction price sales taxes and all other items of a similar nature, and also elected to account for shipping and handling activities as a fulfillment of the promise to transfer the goods. Accordingly, shipping and handling costs are included in cost of sales. Branded CPG may offer promotional activities (e.g. coupons, trade discounts and other promotional activities) to its customers. These variable consideration amounts are estimated for each customer based on specific arrangements/agreements, an analysis of historical volume, and/or current activity with that customer. Reassessment of variable consideration estimates is done at each reporting date throughout the contract period until the uncertainty is resolved (e.g. promotional campaign is closed and settled with customer). Historically, the Company has encountered limited instances whereby customers rejected products as a result of orders being materially inaccurate and/or products being defective. The Company tracks the reason codes for those customer returns. Based on that, the materiality of such returns is assessed. A return reserve is calculated (based on historical data as described above) every month to record an adjustment to net sales; these adjustments have not been significant. The following table presents the Company’s revenues disaggregated by product categories (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Sweeteners and adjacencies $ 389,174 $ 96,857 $ 80,749 $ 165,863 Licorice products 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 The following table presents revenues disaggregated by business and geographic region (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Branded CPG: North America $ 266,661 $ 40,273 $ 29,926 $ 59,945 Europe 76,392 35,384 31,838 64,259 India, Middle East and Africa 13,363 6,727 3,778 12,565 Asia-Pacific 20,787 8,172 9,328 16,922 Latin America 11,971 6,301 5,879 12,172 Flavors & Ingredients 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 The Company records an allowance for doubtful accounts as an estimate of the inability of its customers to make their required payments. The determination of the allowance requires the Company to make assumptions about the future ability to collect amounts owed from customers. |
Marketing and Advertising Costs | Marketing and Advertising Costs —The Company promotes its products with marketing activities, including advertising, consumer incentives and trade promotions. On an annual basis, advertising costs are expensed as incurred or in the year in which the related advertisement initially appears. Marketing and advertising expense was $17.0 million in 2021, $6.2 million for the period from June 26, 2020 through December 31, 2020, $4.8 million from January 1, 2020 through June 25, 2020, and $11.9 million in 2019. Consumer incentive and trade promotion activities are deducted from revenue based on amounts estimated as being or becoming due to customers and consumers at the end of a period, based principally on the Company’s historical utilization and redemption rates. These deductions are estimated and recorded upon sale of product by the Company and revised as necessary at each period end. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments —The Company measures fair value using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is 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. The carrying amounts for cash and cash equivalents, trade accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short-term maturity. The Company measures its term loan and revolving facilities at original carrying value including accrued interest, net of unamortized deferred financing costs and fees. The fair value of the credit facilities approximates carrying value, as they consist of variable rate loans. The Company measures and records in its consolidated and combined financial statements certain assets and liabilities at fair value. ASC Topic 820 “Fair Value Measurement and Disclosures,” establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). This hierarchy consists of the following three levels: • Level 1 – Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market. • Level 2 – Assets and liabilities whose values are based on inputs other than those included in Level 1, including quoted market prices in markets that are not active; quoted prices of assets or liabilities with similar attributes in active markets; or valuation models whose inputs are observable or unobservable but corroborated by market data. • Level 3 – Assets and liabilities whose values are based on valuation models or pricing techniques that utilize unobservable inputs that are significant to the overall fair value measurement. Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Current Assets and Other Financial Assets and Liabilities— Cash and cash equivalents, trade accounts receivable and trade accounts payable are measured at carrying value, which approximates fair value because of the short-term maturities of these instruments. Contingent Consideration Payable— The Company measures the contingent consideration payable at fair value. The fair value of the contingent consideration utilized Level 3 inputs as it is based on significant inputs not observable in the market as of December 31, 2021, such as projected financial information and discount rate. Debt— The Company measures its term loan and revolving facilities at original carrying value including accrued interest, net of unamortized deferred financing costs and fees. The fair value of the credit facilities approximates carrying value, as they consist of variable rate loans. Warrant Liabilities —The Company classifies its Private Warrants as liabilities in accordance with ASC Topic 815. The Company estimates the fair value of the Private Warrants using a Black-Scholes options pricing model. The fair value of the Private Warrants utilized Level 3 inputs as it is based on significant inputs not observable in the market as of December 31, 2021. |
Major Customers and Credit Concentration | Major Customers and Credit Concentration —The Company sells products to customers in the U.S. and internationally. The Company performs ongoing credit evaluations of customers, and generally does not require collateral on trade accounts receivable. Allowances are maintained for potential credit losses and such losses have been within management’s expectations. |
Foreign Currency Translation | Foreign Currency Translation —The Company has determined that the functional currency for each combined subsidiary is its local currency, except for certain entities whose functional currency is the U.S. dollar. Assets and liabilities of entities outside the U.S. are translated into U.S. dollars at the exchange rates in effect at the end of each period and income statement accounts are translated at each period’s average exchange rate. Translation adjustments arising from the use of differing exchange rates from period to period are included as a component of accumulated other comprehensive income (loss) on the balance sheet, except for any entities which may operate in highly inflationary economies. Gains and losses resulting from transactions in other than functional currencies are reflected in operating results, except for transactions of a long-term nature. Remeasurements of European entities whose functional currency is the U.S. dollar as well as translation adjustments for entities operating in highly inflationary economies and impacts of foreign currency transactions are recognized currently in other income (expense), net in the accompanying consolidated and combined statements of operations. The Company had foreign exchange losses, net of $0.2 million in 2021, foreign exchange losses, net of $0.9 million for the period from June 26, 2020 through December 31, 2020, foreign exchange gains, net of $0.5 million from January 1, 2020 through June 25, 2020, and foreign exchange losses, net of $2.0 million in 2019. Beginning January 1, 2019, the Company was required to apply highly-inflationary accounting to its Argentinian subsidiary. This accounting treatment requires a change in the subsidiary’s functional currency from the local currency (Argentinian Peso) to the parent’s reporting currency (USD). This highly-inflationary classification results from the fact that the cumulative inflation rate for the preceding 3 year period exceeded 100 percent as of June 30, 2018. When the Company changed the functional currency, it revalued the subsidiary’s financial statements as if the new functional currency (USD) were the reporting currency. Accordingly, effective January 1, 2019, all Argentinian Peso denominated monetary assets and liabilities are considered foreign currency denominated assets and liabilities and are revalued to USD (the functional currency) with remeasurement adjustments in the period recorded in the statement of operations. The USD will be the functional currency until the economic environment in Argentina ceases to be considered highly-inflationary. As of the date of the Business Combination, the assets and liabilities of the Argentinian subsidiary were adjusted to fair value. Certain non-monetary assets and liabilities that were previously recorded at the applicable historical exchange rates are recorded in USD using the exchange rate as of June 25, 2020. Argentinian Peso denominated monetary assets and liabilities continue to be revalued to USD (the functional currency) with remeasurement period adjustments in the period recorded in the statement of operations. The Company recorded $0.3 million of expense related to remeasurement adjustments in the consolidated statements of operations for both the year ended December 31, 2021 and the period of June 26, 2020 to December 31, 2020, respectively. The impact was not material for the period of January 1, 2020 to June 25, 2020. |
Restructuring and Employee Termination Benefits | Restructuring and Employee Termination Benefits —During 2020 and 2019, the Company adopted restructuring plans to streamline processes and realize cost savings by consolidating facilities and eliminating various positions in operations and general and administrative areas. In connection with the restructuring plans, the Company recognized restructuring and other expenses of $4.5 million, $1.1 million and $2.2 million during the year ended December 31, 2021, for the period from June 26, 2020 to December 31, 2020 and during the year ended December 31, 2019, respectively. This included facility exit and other related costs of $3.9 million and $1.6 million in 2021 and 2019, respectively, and employee termination benefits of $0.6 million in both 2021 and 2019, and $1.1 million for the period from June 26, 2020 to December 31, 2020. In 2021, the Company paid employee termination benefits of $0.8 million. The Company had accrued severance expense related to the restructuring plans of $0.8 million and $1.0 million at December 31, 2021 and 2020, respectively. Termination benefits are payable when an employee is involuntarily terminated, or whenever an employee accepts voluntary termination in exchange for termination benefits. One-time involuntary termination benefits are recognized as a liability when the termination plan meets certain criteria and has been communicated to employees. If employees are required to render future service in order to receive these one-time termination benefits, the liability is recognized ratably over the future service period. |
Warrant Liabilities | Warrant Liabilities—The Company accounts for the Private Warrants in accordance with ASC Topic 815, “Derivatives and Hedging.” Under the guidance contained in ASC Topic 815-40, the Private Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Private Warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. The liability is subject to re-measurement at each balance sheet date, and any change in fair value is recognized in the Company’s statement of operations. The Private Warrants are valued using a Black-Scholes option pricing model. |
Accounting Standards Adopted in the Current Year and Accounting Standards Not Yet Adopted | Accounting Standards Adopted in the Current Year —The Company qualifies as an emerging growth company (an “EGC”) and as such, has elected the extended transition period for complying with certain new or revised accounting pronouncements. During the extended transition period, the Company is not subject to certain new or revised accounting standards applicable to public companies. The accounting pronouncements pending adoption below reflect effective dates for the Company as an EGC with the extended transition period. In August 2018, the FASB issued ASU 2018-15, “Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” Under the new guidance, implementation costs incurred in a hosting arrangement that is a service contract should be expensed or deferred based on the nature of the costs and the project stage during which such costs are incurred. If the implementation costs qualify for deferral, they are required to be amortized over the term of the hosting arrangement and assessed for impairment. Additionally, the ASU requires disclosure of the nature of any hosted cloud computing service arrangement and requires financial statement presentation of deferred costs to be consistent with fees incurred under the hosting arrangement. This standard is effective for the Company as an EGC for fiscal years beginning after December 15, 2020 and interim periods within fiscal years beginning after December 15, 2021. The Company adopted this standard on January 1, 2021 using a prospective transition method. The adoption of this guidance did not have a material impact on the Company’s financial statements and related disclosures. Accounting Standards Not Yet Adopted —In March 2020, the FASB issued ASU 2020-4, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” Subject to meeting certain criteria, the new guidance provides optional expedients and exceptions to applying contract modification accounting under existing U.S. GAAP, to address the expected phase out of the London Inter-bank Offered Rate (“LIBOR”) by the end of 2021. The amendments in ASU 2020-4 apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The new standard was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2022. The Company is currently evaluating the impact of adopting this standard but does not expect it to have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (ASC 740) - Simplifying the Accounting for Income Taxes.” The standard removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis difference. The standard also enhances and simplifies various aspects of the income tax accounting guidance. For public entities, the standard is effective for annual periods and interim periods beginning after December 15, 2020. This standard is effective for the Company as an EGC for the fiscal years beginning after December 15, 2021. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, “Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20).” The standard modifies certain disclosure requirements for employers that sponsor defined benefit pension and other postretirement benefit plans by removing disclosures that are no longer considered cost beneficial, clarifying specific requirements of disclosures, and adding disclosure requirements identified as relevant. This standard is effective for the Company as an EGC for the fiscal years beginning after December 15, 2021. Early adoption is permitted. The amendments in ASU 2018-14 should be applied retrospectively to each period presented. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. |
Earnings Per Share | Basic earnings (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Warrants issued are not considered outstanding at the date of issuance. RSUs and RSAs also are not considered outstanding until they have vested. Contingently issuable shares associated with outstanding PSUs that have cliff vesting based on achievement of a performance condition were not included in the basic earnings per share calculations for the periods presented as the applicable vesting conditions had not been satisfied. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average shares outstanding assuming dilution. Dilutive common shares outstanding is computed using the treasury stock method and reflects the additional shares that would be outstanding if dilutive warrants were exercised and restricted stock units and restricted stock awards were settled for common shares during the period. For warrants that are liability-classified, during the periods when the impact would be dilutive, the Company assumes share settlement of the instruments as of the beginning of the reporting period and adjusts the numerator to remove the change in the fair value of warrant liability and adjusts the denominator to include the dilutive shares using the treasury stock method. |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | The following table presents the Company’s revenues disaggregated by product categories (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Sweeteners and adjacencies $ 389,174 $ 96,857 $ 80,749 $ 165,863 Licorice products 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 The following table presents revenues disaggregated by business and geographic region (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Branded CPG: North America $ 266,661 $ 40,273 $ 29,926 $ 59,945 Europe 76,392 35,384 31,838 64,259 India, Middle East and Africa 13,363 6,727 3,778 12,565 Asia-Pacific 20,787 8,172 9,328 16,922 Latin America 11,971 6,301 5,879 12,172 Flavors & Ingredients 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of Purchase Consideration | The following summarizes the purchase consideration (in thousands): Base cash consideration $ 387,500 Closing adjustment (764) Total Purchase Price $ 386,736 The following summarizes the purchase consideration (in thousands): Base cash consideration $ 80,000 Closing adjustment (968) Total Purchase Price $ 79,032 The following summarizes the preliminary purchase consideration (in thousands): Base cash consideration $ 180,000 Closing adjustment 13,863 Fair value of Earn-Out Amount 52,395 Total Purchase Price $ 246,258 |
Summary of Allocation of the Purchase Price to Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed | The Company recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Cash and cash equivalents $ 10,062 Accounts receivable 45,769 Inventories 106,436 Prepaid expenses and other current assets 2,461 Property, plant and equipment, net 43,554 Operating lease right-of-use assets 12,541 Intangible assets 148,750 Deferred tax assets, net 1,065 Other assets 1,398 Total assets acquired 372,036 Accounts payable 18,590 Accrued expenses and other current liabilities 35,063 Current portion of operating lease liabilities 3,007 Operating lease liabilities, less current portion 12,208 Deferred tax liabilities, net 24,630 Other liabilities 16,227 Total liabilities assumed 109,725 Net assets acquired 262,311 Goodwill 124,425 Total Purchase Price $ 386,736 The Company recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Accounts receivable $ 3,223 Inventories 6,824 Prepaid expenses and other current assets 223 Property, plant and equipment, net 143 Operating lease right-of-use assets 76 Intangible assets 36,300 Other assets 3 Total assets acquired 46,792 Accounts payable 3,477 Accrued expenses and other current liabilities 288 Current portion of operating lease liabilities 48 Operating lease liabilities, less current portion 28 Total liabilities assumed 3,841 Net assets acquired 42,951 Goodwill 36,081 Total Purchase Price $ 79,032 The Company preliminarily recorded the fair value of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed as follows (in thousands): Cash and cash equivalents $ 2,664 Accounts receivable 15,868 Inventories 76,879 Prepaid expenses and other current assets 1,322 Property, plant and equipment, net 3,134 Operating lease right-of-use assets 7,585 Intangible assets 104,500 Other assets 1,189 Total assets acquired 213,141 Accounts payable 5,251 Accrued expenses and other current liabilities 10,576 Current portion of operating lease liabilities 1,435 Operating lease liabilities, less current portion 6,150 Deferred tax liabilities, net 24,234 Total liabilities assumed 47,646 Net assets acquired 165,495 Goodwill 80,763 Total Purchase Price $ 246,258 |
Summary of Values Allocated to Identifiable Intangible Assets and Their Estimated Useful Lives | The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 47,359 0.5 to 10 Tradenames 90,691 25 Product formulations 10,700 Indefinite $ 148,750 The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 3,200 10 Tradenames 33,100 25 $ 36,300 The preliminary values allocated to identifiable intangible assets and their estimated useful lives are as follows: Identifiable intangible assets Fair Value (in thousands) Useful Life (in years) Customer relationships $ 55,700 10 Tradenames 48,800 25 $ 104,500 |
Summary of Pro Forma Financial Information | The following unaudited pro forma financial information summarizes the results of operations for the Company as though the Business Combination and Swerve acquisition had occurred on January 1, 2019 and the Wholesome acquisition had occurred on January 1, 2020 (in thousands): Pro Forma Statements of Operations Year Ended December 31, 2021 December 31, 2020 Revenue $ 514,353 $ 499,652 Net income (loss) $ 14,082 $ (38,266) |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows (in thousands): Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 Operating lease expense $ 5,658 $ 1,662 Variable lease expense 1,022 616 Short-term lease expense 988 47 Sublease income (508) (290) Total $ 7,160 $ 2,035 |
Schedule of Future Maturities of the Company's Lease Obligations | The following table presents the future maturities of the Company’s lease obligations as of December 31, 2021 (in thousands): 2022 $ 8,993 2023 9,204 2024 6,788 2025 4,069 2026 1,797 Thereafter 2,227 Total lease payments 33,078 Less: imputed interest (2,553) Total operating lease liabilities $ 30,525 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consisted of the following (in thousands): December 31, 2021 December 31, 2020 Raw materials and supplies $ 129,712 $ 66,487 Work in process 1,480 562 Finished goods 81,738 44,650 Total inventories $ 212,930 $ 111,699 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consisted of the following (in thousands): December 31, 2021 December 31, 2020 Machinery, equipment and other $ 32,048 $ 14,108 Buildings and improvements 21,243 20,247 53,291 34,355 Accumulated depreciation (6,591) (1,833) 46,700 32,522 Land 6,891 9,670 Construction in progress 4,912 5,093 Property, plant and equipment, net $ 58,503 $ 47,285 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Components of Goodwill and Other Intangible Assets | Goodwill and other intangible assets consisted of the following (in thousands): December 31, 2021 December 31, 2020 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Other intangible assets subject to amortization Customer relationships (useful life of 5 to 10 years) $ 106,013 $ (14,478) $ 91,535 $ 50,877 $ (3,020) $ 47,857 Tradenames (useful life of 25 years) 173,522 (8,818) 164,704 128,155 (2,185) 125,970 Total $ 279,535 $ (23,296) $ 256,239 $ 179,032 $ (5,205) $ 173,827 Other intangible assets not subject to amortization Product formulations 10,700 10,700 Total other intangible assets, net 266,939 184,527 Goodwill 242,661 153,537 Total goodwill and other intangible assets $ 509,600 $ 338,064 |
Schedule of Amortization Expense | Amortization expense relating to amortizable intangible assets as of December 31, 2021 for the next five years is expected to be as follows (in thousands): 2022 $ 18,717 2023 18,717 2024 18,717 2025 18,483 2026 18,263 |
Schedule of Changes in Carrying Amounts of Goodwill | The changes in the carrying amounts of goodwill during the years ended December 31, 2021 and December 31, 2020 were as follows (in thousands): Branded CPG Flavors & Ingredients Total Balance at December 31, 2019 (Predecessor) $ 88,849 $ 42,021 $ 130,870 Impairment (11,100) (6,600) (17,700) Balance at June 25, 2020 (Predecessor) $ 77,749 $ 35,421 $ 113,170 Purchase accounting adjustments 40,779 (31,747) 9,032 Balance at June 26, 2020 (Successor) $ 118,528 $ 3,674 $ 122,202 Acquisition of Swerve 36,003 — 36,003 Currency translation adjustment (4,208) (460) (4,668) Balance at December 31, 2020 (Successor) $ 150,323 $ 3,214 $ 153,537 Purchase accounting adjustments 2,301 — 2,301 Acquisition of Wholesome 80,763 — 80,763 Currency translation adjustment 5,470 590 6,060 Balance at December 31, 2021 (Successor) $ 238,857 $ 3,804 $ 242,661 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Components of Debt | Debt consisted of the following (in thousands): December 31, 2021 December 31, 2020 Term loan, due 2028 $ 372,187 $ 136,500 Revolving credit facility, due 2026 25,000 47,855 Less: current portion (3,750) (7,000) Less: unamortized debt issuance costs (9,953) (4,693) Total long-term debt $ 383,484 $ 172,662 |
Summary of Principal Maturities of Long-Term Debt | The Company’s debt and other obligations outstanding as of December 31, 2021 mature as shown below (in thousands): 2022 $ 3,750 2023 3,750 2024 3,750 2025 3,750 2026 28,750 Thereafter 353,437 Total debt 397,187 Unamortized discounts (9,953) Total debt, net of unamortized discounts $ 387,234 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Assumptions | The fair value of the Private Warrants was estimated at December 31, 2021 using a Black-Scholes options pricing model and the following assumptions: Input December 31, 2021 Asset price $ 10.74 Exercise price $ 11.50 Risk-free interest rate 1.04 % Expected volatility 41.0 % Expected term (years) 3.49 Dividend yield 0.0 % |
Schedule of Changes in Fair Value of Warrants | The changes in the warrant liabilities during the year ended December 31, 2021 were as follows (in thousands): Reclassification of fair value of Private Warrants to warrant liabilities as of January 1, 2021 $ 8,139 Cumulative impact of change in fair value of Private Warrants in 2020 (1,161) Transfer of Private Warrants to Public Warrants (6,057) Change in fair value of warrant liabilities in 2021 1,132 Fair value of warrant liabilities as of December 31, 2021 $ 2,053 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax (Benefit) Provision | Components of the income tax (benefit) provision were as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Current: Federal $ 916 $ (969) $ 51 $ 1,972 State and local 283 54 16 197 Foreign 3,957 1,139 2,029 5,865 5,156 224 2,096 8,034 Deferred: Federal (6,498) (2,192) (4,262) (1,802) State and local (2,801) 138 (259) 336 Foreign (3,001) (788) (1,057) (9,034) (12,300) (2,842) (5,578) (10,500) Total benefit for income taxes $ (7,144) $ (2,618) $ (3,482) $ (2,466) |
Schedule of Effective Income Tax Rate Reconciliation | The following is a reconciliation of income tax (benefit) provision computed at the U.S. federal statutory rate to income tax benefit in the consolidated and combined statements of operations (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 (Loss) income before income taxes: Domestic $ (36,205) $ (18,981) $ (49,477) $ 10,859 Foreign 29,144 7,926 11,859 17,487 Total (loss) income before income taxes $ (7,061) $ (11,055) $ (37,618) $ 28,346 Federal income tax rate 21.0% 21.0% 21.0% 21.0% Federal income taxes $ (1,483) $ (2,322) $ (7,900) $ 5,953 State and local taxes (3,572) 1,812 (278) 426 Foreign rate differential (1,431) (70) (125) 789 Change in tax rates 225 735 — (2,209) Change in uncertain tax positions (1,005) 40 (651) 64 Change in valuation allowance 2,657 (1,474) 883 588 Goodwill impairment — — 3,717 — Impact of Luxembourg restructuring — — — (6,438) U.S. effects of international operations 3,041 320 2,084 3,079 Tax credits (2,763) (2,161) (1,201) (5,233) Section 162(m) limitation 206 — — — Transaction costs 385 — — — Stock-based compensation 502 — — — Switzerland tax ruling (4,057) — — — Foreign withholding taxes 350 — — — Other (199) 502 (11) 515 Total benefit for income taxes $ (7,144) $ (2,618) $ (3,482) $ (2,466) Effective tax rate 101.2% 23.7% 9.3% (8.7)% |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s net deferred tax assets and liabilities were as follows (in thousands): December 31, 2021 December 31, 2020 Deferred tax assets: Accounts receivable $ 381 $ 473 Accrued expenses 5,251 3,838 Inventory 6,166 5,231 Other assets 930 160 Pension asset 365 348 Lease accounting 7,558 3,360 U.S. and foreign net operating losses 17,433 13,998 Deferred interest expense 6,106 — Tax credits 511 254 Total deferred tax assets 44,701 27,662 Less valuation allowance (12,184) (9,879) Net deferred tax assets $ 32,517 $ 17,783 Deferred tax liabilities: Property, plant and equipment (5,271) (4,678) Operating lease right-of-use asset (6,553) (2,747) Intangible assets (46,511) (24,266) Deferred rent (59) (78) Unremitted earnings (965) (719) Other liabilities (6,255) (5,921) Total deferred tax liabilities (65,614) (38,409) Net deferred tax liability $ (33,097) $ (20,626) |
Changes in Unrecognized Tax Benefits | The following summarizes the changes in the Company’s liability for unrecognized tax positions (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Beginning of period $ 609 $ 539 $ 895 Lapse in statute of limitations (507) — (291) Currency differences (8) 70 (65) End of period $ 94 $ 609 $ 539 |
PENSION AND OTHER RETIREMENTS_2
PENSION AND OTHER RETIREMENTS BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Funded Status of Company's Defined Benefit Pension Plans | The following table reconciles the funded status of the Company’s defined benefit pension plans (Successor) From June 26, 2020 to (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Accumulated benefit obligations $ 20,314 $ 41,112 $ 39,792 Changes in projected benefit obligations: Projected benefit obligations at beginning of year $ 41,112 $ 39,879 $ 37,854 Service cost 63 94 41 Interest cost 1,047 545 593 Actuarial (gain) loss (1,054) 1,568 1,826 Benefits paid (20,854) (974) (435) Projected benefit obligations at end of year 20,314 41,112 39,879 Change in plans’ assets: Fair value of plans’ assets at beginning of year 33,058 30,674 30,213 Actual returns on plans’ assets 372 3,195 732 Employee contributions 326 163 163 Benefits paid (20,854) (974) (434) Fair value of plans’ assets at end of year 12,902 33,058 30,674 Net pension liability $ (7,412) $ (8,054) $ (9,205) |
Schedule of Amounts Recognized in Balance Sheet | Amounts recognized in the Company’s consolidated and combined balance sheets consisted of (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Other assets $ 2,367 $ 2,238 $ 512 Accrued expenses and other current liabilities (488) (374) (373) Other liabilities (9,291) (9,918) (9,344) Net amount recognized $ (7,412) $ (8,054) $ (9,205) |
Schedule of Net Periodic Benefit Cost Not yet Recognized | Amounts recognized in accumulated other comprehensive income (loss), net of tax, which have not yet been recognized as a component of net periodic pension expense for the Company’s funded defined benefit pension plans, are as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Prior service cost $ — $ — $ 169 Net actuarial (gain) loss (207) (620) 13,997 $ (207) $ (620) $ 14,166 |
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | The components of the changes in unrecognized amounts included in pension obligation, net in other comprehensive income (loss) for the Company’s defined benefit pension plans were as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Net actuarial loss $ 527 $ — $ 1,912 Amortization of prior service costs — — (33) Amortization of actuarial loss (36) — (276) Total loss recognized in other comprehensive income $ 491 $ — $ 1,603 |
Components of Net Periodic Benefit (Credit) Expense | The components of net periodic benefit (credit) cost for the Company’s defined benefit pension plans for the Successor and Predecessor were as follows (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Service cost $ 63 $ 94 $ 41 $ 692 Interest cost 1,047 545 593 1,410 Expected return on plan assets (1,310) (783) (817) (1,462) Amortization of prior service cost — — 33 149 Amortization of net actuarial loss 36 — 276 1,332 Settlement/curtailment (income) expense (644) (25) — 317 Net periodic benefit (credit) cost $ (808) $ (169) $ 126 $ 2,438 Net periodic benefit (credit) cost is reflected in the Company’s consolidated and combined financial statements as follows for the Successor and Predecessor periods presented (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Cost of goods sold $ — $ — $ — $ 614 Selling, general and administrative expense 63 69 41 1,824 Other income (expense), net (871) (238) 85 — Net periodic benefit (credit) cost $ (808) $ (169) $ 126 $ 2,438 |
Schedule of Assumptions for Benefit Obligations | The following assumptions were used to determine the benefit obligation at year end and net periodic benefit (credit) cost during the year for the Company’s funded defined benefit pension plan: (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Weighted-average assumptions used to determine benefit obligation at year end: Discount rate (1) 2.38 % 2.61 % 2.85 % Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 2.61 % 2.85 % 3.25 % Expected long-term rate of return on plan assets 4.90 % 5.25 % 5.50 % (1) The discount rate assumption used to determine the benefit obligation at December 31, 2021 was based on blended 7 year and 15 year duration annuity purchase contracts. The following assumptions were used to determine the benefit obligation at year end and net periodic benefit (credit) cost during the year for the Company’s unfunded supplemental defined benefit pension plan: (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Weighted-average assumptions used to determine benefit obligation at year end: Discount rate 2.78 % 2.42 % 2.64 % Rate of compensation increase 3.50 % 3.50 % 3.50 % Weighted-average assumptions used to determine net periodic benefit cost: Discount rate 2.42 % 2.64 % 3.25 % Rate of compensation increase 3.50 % 3.50 % 3.50 % |
Schedule of Target Allocation and Fair Value of Plan Assets | The plan had the following target ranges for the asset classes as shown below. The ranges were intended to allow flexibility for allocating assets and rebalancing as needed depending on changes in market values and the investment environment. The strategy utilized was regularly reviewed by the plan’s investment committee, which could have made adjustments to the allocations when allocations fell outside the asset class range. Target Ranges Asset classes: Cash equivalents and other 0% - 17% Fixed income securities 45% - 100% Equity securities 0% - 28% The following tables set forth, by category, the Company’s pension plan assets as of December 31, 2021 and December 31, 2020, using the fair value hierarchy established under ASC Topic 820 and as described in Note 9. The fair value hierarchy in the tables excludes certain investments which are valued using Net Asset Value (“NAV”) as a practical expedient (in thousands): Pension Plan Assets as of December 31, 2021 Level 1 Level 2 Level 3 Total Pension plan assets measured at fair value: Cash and cash equivalents $ 325 $ — $ — $ 325 U.S. Government securities — 6,283 — 6,283 Corporate bonds — 6,283 — 6,283 Total pension plan assets measured at fair value $ 325 $ 12,566 $ — $ 12,891 Pension plan assets measured at NAV as a practical expedient (1) 11 Total pension plan assets $ 12,902 (1) Certain investments in real estate funds that are measured at fair value using the NAV per share practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table above are intended to permit reconciliation of the fair value hierarchy to the total value of plan assets. Pension Plan Assets as of December 31, 2020 Level 1 Level 2 Level 3 Total Pension plan assets measured at fair value: Cash and cash equivalents $ 419 $ — $ — $ 419 Mutual funds 5,374 442 — 5,816 U.S. Government securities — 3,087 — 3,087 Municipal/provincial bonds — 296 — 296 Corporate bonds — 13,408 — 13,408 Total pension plan assets measured at fair value $ 5,793 $ 17,233 $ — $ 23,026 Pension plan assets measured at NAV as a practical expedient (1) 10,032 Total pension plan assets $ 33,058 (1) Certain common/collective trusts, investments in private equity funds and investments in real estate funds that are measured at fair value using the NAV per share practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table above are intended to permit reconciliation of the fair value hierarchy to the total value of plan assets. |
Schedule of Projected Benefit Payments | The projected benefit payments for the funded qualified and unfunded non-qualified defined benefit pension plans are as follows (in thousands): Qualified Pension Plan Non-qualified Pension Plans 2022 $ 535 $ 488 2023 515 482 2024 514 497 2025 507 503 2026 501 563 2027-2031 2,572 2,922 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Activity Related to RSUs and RSAs | A summary of activity and weighted average fair values related to the RSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2020 633,057 $ 8.34 0.88 Granted 576,687 13.48 Vested (582,503) 8.34 Forfeited (142,497) 11.70 Outstanding and nonvested at December 31, 2021 484,744 $ 13.46 1.02 A summary of activity and weighted average fair values related to the RSAs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2020 68,946 $ 8.34 1.33 Granted 48,855 11.77 Outstanding and nonvested at December 31, 2021 117,801 $ 9.76 0.98 The weighted average grant date fair value per share of RSAs granted during the year was $11.77 in 2021 and $8.34 for the period from June 26, 2020 through December 31, 2020. A summary of activity and weighted average fair values related to the PSUs is as follows: Shares Weighted Average Grant Date Weighted Average Outstanding at December 31, 2020 — $ — — Granted 323,555 13.65 Forfeited (41,414) 13.65 Outstanding and nonvested at December 31, 2021 282,141 $ 13.65 2.21 |
Schedule of Unrecognized Compensation Cost on Nonvested Awards | As of December 31, 2021, the Company had not yet recognized compensation cost on nonvested awards as follows (in thousands): Unrecognized Weighted Avg. Nonvested awards $ 7,694 1.4 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted (Loss) Earnings Per Common Share | The computation of basic and diluted earnings (loss) per common share for the year ended December 31, 2021 and the period from June 26, 2020 to December 31, 2020 is shown below (in thousands, except for share and per share data): Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 EPS numerator: Net income (loss) attributable to common shareholders $ 83 $ (8,437) Less: Change in fair value of warrant liabilities (29) — Numerator - diluted $ 54 $ (8,437) EPS denominator: Weighted average shares outstanding - basic 38,505,458 38,426,669 Effect of dilutive securities 1,370,929 — Weighted average shares outstanding - diluted 39,876,387 38,426,669 Net earnings (loss) per share: Basic $ 0.00 $ (0.22) Diluted $ 0.00 $ (0.22) |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
AOCI Attributable to Parent [Abstract] | |
Summary of Change in the Components of Accumulated Other Comprehensive Loss, Net of Tax | The following table summarizes accumulated other comprehensive income (loss) (“AOCI”), net of taxes, by component (in thousands): Net Currency Funded Status of Benefit Plans Total Balance at December 31, 2019 (Predecessor) $ 2,885 $ (10,944) $ (8,059) Other comprehensive loss before reclassifications (2,286) — (2,286) Amounts reclassified from AOCI — 318 318 Balance at June 25, 2020 (Predecessor) $ 599 $ (10,626) $ (10,027) Purchase accounting adjustments to eliminate Predecessor’s accumulated other comprehensive (loss) income (599) 10,626 10,027 Balance at June 26, 2020 (Successor) $ — $ — $ — Other comprehensive income before reclassifications 7,774 856 8,630 Amounts reclassified from AOCI — (25) (25) Balance December 31, 2020 (Successor) $ 7,774 $ 831 $ 8,605 Other comprehensive income before reclassifications 984 701 1,685 Amounts reclassified from AOCI — (603) (603) Balance December 31, 2021 (Successor) $ 8,758 $ 929 $ 9,687 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Selected Financial Information Relating to the Business' Reportable Segments | The following table presents selected financial information relating to the Company’s business segments (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 Product revenues, net Branded CPG $ 389,174 $ 96,857 $ 80,749 $ 165,863 Flavors & Ingredients 104,799 50,311 47,579 106,260 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 Operating income (loss) Branded CPG $ 34,918 $ 13,463 $ (5,055) $ 19,800 Flavors & Ingredients 21,860 (2,645) (23,718) 19,396 56,778 10,818 (28,773) 39,196 Corporate (33,962) (16,924) (9,408) (9,520) Total operating income (loss) $ 22,816 $ (6,106) $ (38,181) $ 29,676 |
Summary of Revenues Disaggregated by Geographic Operating Segments | The following table presents geographic information based upon revenues of the Company’s major geographic markets (in thousands): (Successor) (Predecessor) Year Ended December 31, 2021 From June 26, 2020 to December 31, 2020 From January 1, 2020 to Year Ended December 31, 2019 North America $ 318,958 $ 63,386 $ 54,253 $ 104,788 Europe 96,013 45,608 42,776 93,508 India, Middle East and Africa 14,801 6,996 3,959 12,888 Asia-Pacific 51,598 24,350 20,834 46,845 Latin America 12,603 6,828 6,506 14,094 Total product revenues, net $ 493,973 $ 147,168 $ 128,328 $ 272,123 |
Summary of Long-Lived Assets Disaggregated by Geographic Operating Segments | Long-lived assets are as follows (in thousands): December 31, 2021 December 31, 2020 Long-Lived Assets* United States $ 24,327 $ 14,798 China 15,620 14,207 Czech Republic 6,074 6,070 France 11,353 11,076 Other Foreign Countries 1,129 1,134 Total $ 58,503 $ 47,285 |
BASIS OF PRESENTATION AND SIG_4
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) | Jun. 25, 2020 | Jun. 30, 2021 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | Mar. 31, 2021 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Private placement warrants issued (in shares) | 5,263,500 | ||||||
Shares called upon by private placement warrants (in shares) | 2,631,750 | 2,631,750 | 100 | ||||
Deferred software costs | $ 0 | $ 1,000,000 | |||||
Amortization of deferred software costs | 0 | ||||||
Research and development expenses | 1,600,000 | $ 1,700,000 | 3,400,000 | $ 3,400,000 | |||
Workers compensation and group medical liabilities | 500,000 | 100,000 | |||||
Advertising expense | 6,200,000 | 4,800,000 | 17,000,000 | 11,900,000 | |||
Total foreign exchange gains (losses), tax | (900,000) | 500,000 | (200,000) | (2,000,000) | |||
Expense related to remeasurement adjustments | 300,000 | 0 | 300,000 | ||||
Restructuring and other non-recurring expenses | 1,052,000 | 0 | 4,503,000 | 2,193,000 | |||
Payments of employee termination benefits | 800,000 | ||||||
Change in fair value of warrant liabilities | 0 | $ 0 | (29,000) | 0 | |||
Private Placement | Level 3 | Warrants and Rights Outstanding | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Warrant liabilities | 8,139,000 | $ 2,053,000 | |||||
Minimum | Buildings | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Property, plant and equipment, useful life | 3 years | ||||||
Minimum | Property, Plant and Equipment, Other Types | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Property, plant and equipment, useful life | 1 year | ||||||
Maximum | Buildings | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Property, plant and equipment, useful life | 40 years | ||||||
Maximum | Property, Plant and Equipment, Other Types | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Property, plant and equipment, useful life | 20 years | ||||||
Facility Closing | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Restructuring and other non-recurring expenses | $ 3,900,000 | 1,600,000 | |||||
Employee Severance | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Restructuring and other non-recurring expenses | 1,100,000 | 600,000 | $ 600,000 | ||||
Accrued severance expense | 1,000,000 | $ 800,000 | |||||
Common Stock | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Conversion basis for conversion of the then-issued and outstanding ordinary shares of predecessor into successor shares (in shares) | 1 | ||||||
Shares issued (in shares) | 7,500,000 | ||||||
Restatement adjustment | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Change in fair value of warrant liabilities | $ 1,200,000 | ||||||
Restatement adjustment | Merisant and Mafco Worldwide | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Transaction costs | $ 1,100,000 | ||||||
Restatement adjustment | Private Placement | Level 3 | Warrants and Rights Outstanding | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Warrant liabilities | $ (1,161,000) |
BASIS OF PRESENTATION AND SIG_5
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | $ 147,168 | $ 128,328 | $ 493,973 | $ 272,123 |
Flavors & Ingredients | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 50,311 | 47,579 | 104,799 | 106,260 |
North America | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 63,386 | 54,253 | 318,958 | 104,788 |
North America | Branded CPG | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 40,273 | 29,926 | 266,661 | 59,945 |
Europe | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 45,608 | 42,776 | 96,013 | 93,508 |
Europe | Branded CPG | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 35,384 | 31,838 | 76,392 | 64,259 |
India, Middle East and Africa | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 6,996 | 3,959 | 14,801 | 12,888 |
India, Middle East and Africa | Branded CPG | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 6,727 | 3,778 | 13,363 | 12,565 |
Asia-Pacific | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 24,350 | 20,834 | 51,598 | 46,845 |
Asia-Pacific | Branded CPG | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 8,172 | 9,328 | 20,787 | 16,922 |
Latin America | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 6,828 | 6,506 | 12,603 | 14,094 |
Latin America | Branded CPG | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 6,301 | 5,879 | 11,971 | 12,172 |
Sweeteners and adjacencies | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | 96,857 | 80,749 | 389,174 | 165,863 |
Licorice products | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Product revenues, net | $ 50,311 | $ 47,579 | $ 104,799 | $ 106,260 |
BUSINESS COMBINATION - Purchase
BUSINESS COMBINATION - Purchase Consideration (Details) - USD ($) $ in Thousands | Feb. 05, 2021 | Nov. 10, 2020 | Jun. 25, 2020 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||||||
Base cash consideration | $ 456,508 | $ 0 | $ 190,231 | $ 0 | ||||
Fair value of Earn-Out Amount | $ 47,900 | |||||||
Merisant and Mafco Worldwide | ||||||||
Business Acquisition [Line Items] | ||||||||
Base cash consideration | $ 387,500 | |||||||
Closing adjustment | (764) | |||||||
Total Purchase Price | $ 386,736 | |||||||
Swerve | ||||||||
Business Acquisition [Line Items] | ||||||||
Base cash consideration | 80,000 | |||||||
Closing adjustment | (968) | |||||||
Total Purchase Price | $ 79,032 | |||||||
Wholesome | ||||||||
Business Acquisition [Line Items] | ||||||||
Base cash consideration | $ 180,000 | |||||||
Closing adjustment | 13,863 | $ 3,600 | ||||||
Fair value of Earn-Out Amount | 52,395 | |||||||
Total Purchase Price | $ 246,258 |
BUSINESS COMBINATION - Allocati
BUSINESS COMBINATION - Allocation of the Purchase Price to Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Feb. 05, 2021 | Nov. 10, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 26, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 113,170 | $ 242,661 | $ 153,537 | $ 122,202 | $ 130,870 | ||
Merisant and Mafco Worldwide | |||||||
Business Acquisition [Line Items] | |||||||
Cash and cash equivalents | 10,062 | ||||||
Accounts receivable | 45,769 | ||||||
Inventories | 106,436 | ||||||
Prepaid expenses and other current assets | 2,461 | ||||||
Property, plant and equipment, net | 43,554 | ||||||
Operating lease right-of-use assets | 12,541 | ||||||
Intangible assets | 148,750 | ||||||
Deferred tax assets, net | 1,065 | ||||||
Other assets | 1,398 | ||||||
Total assets acquired | 372,036 | ||||||
Accounts payable | 18,590 | ||||||
Accrued expenses and other current liabilities | 35,063 | ||||||
Current portion of operating lease liabilities | 3,007 | ||||||
Operating lease liabilities, less current portion | 12,208 | ||||||
Deferred tax liabilities, net | 24,630 | ||||||
Other liabilities | 16,227 | ||||||
Total liabilities assumed | 109,725 | ||||||
Net assets acquired | 262,311 | ||||||
Goodwill | 124,425 | ||||||
Total Purchase Price | $ 386,736 | ||||||
Swerve | |||||||
Business Acquisition [Line Items] | |||||||
Accounts receivable | $ 3,223 | ||||||
Inventories | 6,824 | ||||||
Prepaid expenses and other current assets | 223 | ||||||
Property, plant and equipment, net | 143 | ||||||
Operating lease right-of-use assets | 76 | ||||||
Intangible assets | 36,300 | ||||||
Other assets | 3 | ||||||
Total assets acquired | 46,792 | ||||||
Accounts payable | 3,477 | ||||||
Accrued expenses and other current liabilities | 288 | ||||||
Current portion of operating lease liabilities | 48 | ||||||
Operating lease liabilities, less current portion | 28 | ||||||
Total liabilities assumed | 3,841 | ||||||
Net assets acquired | 42,951 | ||||||
Goodwill | 36,081 | ||||||
Total Purchase Price | $ 79,032 | ||||||
Wholesome | |||||||
Business Acquisition [Line Items] | |||||||
Cash and cash equivalents | $ 2,664 | ||||||
Accounts receivable | 15,868 | ||||||
Inventories | 76,879 | ||||||
Prepaid expenses and other current assets | 1,322 | ||||||
Property, plant and equipment, net | 3,134 | ||||||
Operating lease right-of-use assets | 7,585 | ||||||
Intangible assets | 104,500 | ||||||
Other assets | 1,189 | ||||||
Total assets acquired | 213,141 | ||||||
Accounts payable | 5,251 | ||||||
Accrued expenses and other current liabilities | 10,576 | ||||||
Current portion of operating lease liabilities | 1,435 | ||||||
Operating lease liabilities, less current portion | 6,150 | ||||||
Deferred tax liabilities, net | 24,234 | ||||||
Total liabilities assumed | 47,646 | ||||||
Net assets acquired | 165,495 | ||||||
Goodwill | 80,763 | ||||||
Total Purchase Price | $ 246,258 |
BUSINESS COMBINATION - Values A
BUSINESS COMBINATION - Values Allocated to Identifiable Intangible Assets and Their Estimated Useful Lives (Details) - USD ($) $ in Thousands | Feb. 05, 2021 | Nov. 10, 2020 | Jun. 25, 2020 |
Merisant and Mafco Worldwide | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 148,750 | ||
Merisant and Mafco Worldwide | Product formulations | |||
Business Acquisition [Line Items] | |||
Intangible assets | 10,700 | ||
Merisant and Mafco Worldwide | Customer relationships | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 47,359 | ||
Merisant and Mafco Worldwide | Customer relationships | Minimum | |||
Business Acquisition [Line Items] | |||
Useful life (in Years) | 6 months | ||
Merisant and Mafco Worldwide | Customer relationships | Maximum | |||
Business Acquisition [Line Items] | |||
Useful life (in Years) | 10 years | ||
Merisant and Mafco Worldwide | Tradenames | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 90,691 | ||
Useful life (in Years) | 25 years | ||
Swerve | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 36,300 | ||
Swerve | Customer relationships | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 3,200 | ||
Useful life (in Years) | 10 years | ||
Swerve | Tradenames | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 33,100 | ||
Useful life (in Years) | 25 years | ||
Wholesome | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 104,500 | ||
Wholesome | Customer relationships | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 55,700 | ||
Useful life (in Years) | 10 years | ||
Wholesome | Tradenames | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 48,800 | ||
Useful life (in Years) | 25 years |
BUSINESS COMBINATION - Narrativ
BUSINESS COMBINATION - Narrative (Details) - USD ($) | Feb. 23, 2022 | Feb. 05, 2021 | Nov. 10, 2020 | Jun. 26, 2020 | Jun. 25, 2020 | Jun. 30, 2021 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2019 | Mar. 31, 2021 |
Business Acquisition [Line Items] | ||||||||||||
Increase (decrease) in goodwill | $ 9,032,000 | $ 2,301,000 | ||||||||||
Base cash consideration | $ 456,508,000 | $ 0 | 190,231,000 | $ 0 | ||||||||
Remaining borrowing capacity | $ 47,900,000 | |||||||||||
Contingent consideration payable | 0 | $ 54,113,000 | 54,113,000 | |||||||||
Revolving Credit Facility | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Maximum outstanding borrowings | $ 50,000,000 | 50,000,000 | ||||||||||
Merisant and Mafco Worldwide | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Goodwill deductible for income tax purposes | $ 2,500,000 | 2,500,000 | ||||||||||
Goodwill deductible for income tax purposes, period (in years) | 15 years | |||||||||||
Closing adjustment period | 1 year | |||||||||||
Increase (decrease) in deferred tax liabilities | $ 1,500,000 | |||||||||||
Increase (decrease) in other liabilities | 700,000 | |||||||||||
Increase (decrease) in goodwill | $ 2,200,000 | |||||||||||
Base cash consideration | $ 387,500,000 | |||||||||||
Closing adjustment | (764,000) | |||||||||||
Merisant and Mafco Worldwide | Restatement adjustment | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Transaction costs | $ 1,100,000 | |||||||||||
Merisant and Mafco Worldwide | Act II Global Acquisition Corp | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Transaction costs | $ 18,100,000 | $ 18,100,000 | ||||||||||
Swerve | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Goodwill deductible for income tax purposes, period (in years) | 15 years | |||||||||||
Closing adjustment period | 1 year | |||||||||||
Transaction costs | $ 3,200,000 | 300,000 | 300,000 | |||||||||
Base cash consideration | $ 80,000,000 | |||||||||||
Closing adjustment | $ (968,000) | |||||||||||
Wholesome | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Goodwill deductible for income tax purposes | $ 4,700,000 | |||||||||||
Goodwill deductible for income tax purposes, period (in years) | 9 years | |||||||||||
Closing adjustment period | 1 year | |||||||||||
Increase (decrease) in deferred tax liabilities | (2,800,000) | |||||||||||
Increase (decrease) in goodwill | 1,000,000 | |||||||||||
Transaction costs | 4,700,000 | 4,700,000 | ||||||||||
Base cash consideration | $ 180,000,000 | |||||||||||
Remaining borrowing capacity | 52,395,000 | |||||||||||
Contingent consideration payable | 55,000,000 | |||||||||||
EBITDA Threshold | 30,000,000 | |||||||||||
Earn-out amounts payable in common stock | $ 27,500,000 | |||||||||||
Weighted average trading price period | 20 days | |||||||||||
Closing adjustment | $ 13,863,000 | 3,600,000 | ||||||||||
Increase (decrease) in inventory | (1,800,000) | |||||||||||
Increase (decrease) in prepaid expenses and other current assets | 500,000 | |||||||||||
Increase (decrease) in property, plant and equipment | 400,000 | |||||||||||
Increase (decrease) in intangible assets | (1,900,000) | |||||||||||
Increase (decrease) in other assets | (100,000) | |||||||||||
Increase (decrease) in accrued expenses and other current liabilities | $ (2,700,000) | |||||||||||
Product revenue, net | 179,600,000 | |||||||||||
Operating income | $ 20,600,000 | |||||||||||
Wholesome | Subsequent Event | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Shares issued (in shares) | 2,659,574 | |||||||||||
Payments of contingent consideration | $ 30,000,000 | |||||||||||
Gain on settlement of contingent consideration liability | $ 1,000,000 |
BUSINESS COMBINATION - Pro Form
BUSINESS COMBINATION - Pro Forma Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Business Combination and Asset Acquisition [Abstract] | ||
Revenue | $ 514,353 | $ 499,652 |
Net loss | $ 14,082 | $ (38,266) |
LEASES - Narrative (Details)
LEASES - Narrative (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2020USD ($) | Jun. 25, 2020USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2019USD ($) | Feb. 05, 2021USD ($)lease | |
Lessee, Lease, Description [Line Items] | |||||
Lease expense | $ 2,200 | $ 5,200 | |||
Sublease income | $ 300 | $ 500 | |||
Weighted-average remaining lease term (in years) | 4 years 7 months 6 days | 4 years | |||
Weighted-average discount rate (as a percent) | 3.42% | 3.99% | |||
Operating lease payments | $ 1,700 | $ 5,700 | |||
Wholesome | |||||
Lessee, Lease, Description [Line Items] | |||||
Operating lease right-of-use assets | $ 7,585 | ||||
Operating lease, number of leases | lease | 2 | ||||
Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Extended lease term (in years) | 1 year | ||||
Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Extended lease term (in years) | 5 years |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating lease expense | $ 1,662 | $ 5,658 |
Variable lease expense | 616 | 1,022 |
Short-term lease expense | 47 | 988 |
Sublease income | (290) | (508) |
Total | $ 2,035 | $ 7,160 |
LEASES - Future Maturities of t
LEASES - Future Maturities of the Company's Lease Obligations (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Leases [Abstract] | |
2022 | $ 8,993 |
2023 | 9,204 |
2024 | 6,788 |
2025 | 4,069 |
2026 | 1,797 |
Thereafter | 2,227 |
Total lease payments | 33,078 |
Less: imputed interest | (2,553) |
Total operating lease liabilities | $ 30,525 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 129,712 | $ 66,487 |
Work in process | 1,480 | 562 |
Finished goods | 81,738 | 44,650 |
Total inventories | $ 212,930 | $ 111,699 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Accumulated depreciation | $ (6,591) | $ (1,833) |
Property, Plant and Equipment, net | 58,503 | 47,285 |
Depreciable property, plant and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 53,291 | 34,355 |
Property, Plant and Equipment, net | 46,700 | 32,522 |
Machinery, equipment and other | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 32,048 | 14,108 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 21,243 | 20,247 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 6,891 | 9,670 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 4,912 | $ 5,093 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Components of Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2021 | Dec. 31, 2020 | Jun. 26, 2020 | Jun. 25, 2020 | Dec. 31, 2019 | |
Other intangible assets subject to amortization | |||||
Other intangible assets subject to amortization, Gross | $ 279,535 | $ 179,032 | |||
Other intangible assets subject to amortization, Accumulated Amortization | (23,296) | (5,205) | |||
Other intangible assets subject to amortization, Net | 256,239 | 173,827 | |||
Other intangible assets not subject to amortization | |||||
Total other intangible assets, net | 266,939 | 184,527 | |||
Goodwill | 242,661 | 153,537 | $ 122,202 | $ 113,170 | $ 130,870 |
Total goodwill and other intangible assets | 509,600 | 338,064 | |||
Product formulations | |||||
Other intangible assets not subject to amortization | |||||
Other intangible assets not subject to amortization, Net | 10,700 | 10,700 | |||
Customer relationships | |||||
Other intangible assets subject to amortization | |||||
Other intangible assets subject to amortization, Gross | 106,013 | 50,877 | |||
Other intangible assets subject to amortization, Accumulated Amortization | (14,478) | (3,020) | |||
Other intangible assets subject to amortization, Net | $ 91,535 | 47,857 | |||
Customer relationships | Minimum | |||||
Other intangible assets not subject to amortization | |||||
Other intangible assets subject to amortization, useful life (in years) | 5 years | ||||
Customer relationships | Maximum | |||||
Other intangible assets not subject to amortization | |||||
Other intangible assets subject to amortization, useful life (in years) | 10 years | ||||
Tradenames | |||||
Other intangible assets subject to amortization | |||||
Other intangible assets subject to amortization, Gross | $ 173,522 | 128,155 | |||
Other intangible assets subject to amortization, Accumulated Amortization | (8,818) | (2,185) | |||
Other intangible assets subject to amortization, Net | $ 164,704 | $ 125,970 | |||
Other intangible assets not subject to amortization | |||||
Other intangible assets subject to amortization, useful life (in years) | 25 years |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Goodwill [Line Items] | |||||
Amortization of intangible assets | $ 6,021 | $ 4,927 | $ 18,295 | $ 10,724 | |
Impairment of intangible assets | $ 22,900 | ||||
Goodwill impairment charge | $ 17,700 | ||||
Weighted Average | |||||
Goodwill [Line Items] | |||||
Other intangible assets subject to amortization, useful life (in years) | 18 years 2 months 12 days | ||||
Customer relationships | Weighted Average | |||||
Goodwill [Line Items] | |||||
Other intangible assets subject to amortization, useful life (in years) | 8 years 1 month 6 days | ||||
Tradenames | |||||
Goodwill [Line Items] | |||||
Other intangible assets subject to amortization, useful life (in years) | 25 years | ||||
Tradenames | Weighted Average | |||||
Goodwill [Line Items] | |||||
Other intangible assets subject to amortization, useful life (in years) | 23 years 9 months 18 days | ||||
Mafco Worldwide | |||||
Goodwill [Line Items] | |||||
Amount of fair value in excess of carrying amount | 6,600 | ||||
Merisant | |||||
Goodwill [Line Items] | |||||
Amount of fair value in excess of carrying amount | 11,100 | ||||
Merisant and Mafco Worldwide | |||||
Goodwill [Line Items] | |||||
Goodwill impairment charge | $ 17,700 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Amortization Expense (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2022 | $ 18,717 |
2023 | 18,717 |
2024 | 18,717 |
2025 | 18,483 |
2026 | $ 18,263 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amounts of Goodwill (Details) - USD ($) $ in Thousands | Jun. 26, 2020 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 |
Goodwill [Roll Forward] | ||||
Beginning balance | $ 113,170 | $ 113,170 | $ 130,870 | $ 153,537 |
Impairment | (17,700) | |||
Purchase accounting adjustments | 9,032 | 2,301 | ||
Acquisition | 36,003 | 80,763 | ||
Currency translation adjustment | (4,668) | 6,060 | ||
Ending balance | 122,202 | 153,537 | 113,170 | 242,661 |
Branded CPG | ||||
Goodwill [Roll Forward] | ||||
Beginning balance | 77,749 | 77,749 | 88,849 | 150,323 |
Impairment | (11,100) | |||
Purchase accounting adjustments | 40,779 | 2,301 | ||
Acquisition | 36,003 | 80,763 | ||
Currency translation adjustment | (4,208) | 5,470 | ||
Ending balance | 118,528 | 150,323 | 77,749 | 238,857 |
Flavors & Ingredients | ||||
Goodwill [Roll Forward] | ||||
Beginning balance | 35,421 | 35,421 | 42,021 | 3,214 |
Impairment | (6,600) | |||
Purchase accounting adjustments | (31,747) | 0 | ||
Acquisition | 0 | 0 | ||
Currency translation adjustment | (460) | 590 | ||
Ending balance | $ 3,674 | $ 3,214 | $ 35,421 | $ 3,804 |
DEBT - Components of Debt (Deta
DEBT - Components of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 397,187 | |
Less: current portion | (3,750) | $ (7,000) |
Less: unamortized debt issuance costs | (9,953) | (4,693) |
Long-term debt | 383,484 | 172,662 |
Secured Debt | Senior Secured First Lien Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 372,187 | 136,500 |
Revolving Credit Facility | First Lien Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 25,000 | $ 47,855 |
DEBT - Principal Maturities of
DEBT - Principal Maturities of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
2022 | $ 3,750 | |
2023 | 3,750 | |
2024 | 3,750 | |
2025 | 3,750 | |
2026 | 28,750 | |
Thereafter | 353,437 | |
Total debt | 397,187 | |
Unamortized discounts | (9,953) | $ (4,693) |
Total debt, net of unamortized discounts | $ 387,234 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | Feb. 05, 2021USD ($) | Feb. 04, 2021USD ($) | Dec. 31, 2020USD ($) | Jun. 25, 2020USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2019USD ($) | Nov. 10, 2020USD ($) |
Debt Instrument [Line Items] | |||||||
Long-term debt | $ 387,234,000 | ||||||
Gain (loss) on extinguishment of debt | $ 0 | $ 0 | (5,513,000) | $ 0 | |||
Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance costs | $ 7,800,000 | $ 6,200,000 | |||||
Gain (loss) on extinguishment of debt | (1,100,000) | $ (4,400,000) | |||||
Payments of fees to lenders | 3,800,000 | ||||||
Transaction costs | $ 8,900,000 | ||||||
Credit Facilities | Debt Redemption, Term 1 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, redemption price (as a percent) | 100.00% | ||||||
Dispositions of property, minimum amount | $ 5,000,000 | ||||||
Credit Facilities | Debt Redemption, Term 2 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, redemption price (as a percent) | 100.00% | ||||||
Credit Facilities | Debt Redemption, Term 3 | |||||||
Debt Instrument [Line Items] | |||||||
Excess Cash Flow (as a percent) | 50.00% | ||||||
Credit Facilities | Debt Redemption, Term 3 | Debt Instrument, Agreement Requirements, Requirement One | |||||||
Debt Instrument [Line Items] | |||||||
Excess Cash Flow upon satisfaction of agreement requirements (as a percent) | 25.00% | ||||||
Maximum net leverage ratio | 3.50 | ||||||
Minimum net leverage ratio | 3 | ||||||
Quarterly amortization payments (as a percent) | 0.25% | ||||||
Credit Facilities | Debt Redemption, Term 3 | Debt Instrument, Agreement Requirements, Requirement Two | |||||||
Debt Instrument [Line Items] | |||||||
Excess Cash Flow upon satisfaction of agreement requirements (as a percent) | 0.00% | ||||||
Maximum net leverage ratio | 3 | ||||||
Revolving Credit Facility | First Lien Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Outstanding letter of credit | 2,100,000 | ||||||
Borrowings | 47,900,000 | 25,000,000 | |||||
Revolving Credit Facility | Revolving Facility | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 75,000,000 | ||||||
Commitment fee (as a percent) | 0.50% | ||||||
Secured Debt | Senior Secured First Lien Term Loan Facility | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 131,800,000 | 362,200,000 | |||||
Debt issuance costs | 4,700,000 | 10,000,000 | |||||
Secured Debt | Term Loan Facility | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 375,000,000 | ||||||
Letter of Credit | Revolving Facility | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | 15,000,000 | ||||||
Bridge Loan | Revolving Facility | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 15,000,000 | ||||||
Senior Secured First Lien Term Loan Facility | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | 140,000,000 | ||||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | 50,000,000 | $ 50,000,000 | |||||
Outstanding letter of credit | 2,100,000 | ||||||
Issuance costs capitalized | $ 1,700,000 | $ 1,800,000 | |||||
Base Rate | Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 2.75% | ||||||
Base Rate | Secured Debt | Term Loan Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 3.50% | ||||||
Base Rate | Maximum | Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 0.00% | ||||||
LIBOR | Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 3.75% | ||||||
LIBOR | Revolving Credit Facility | Revolving Facility | |||||||
Debt Instrument [Line Items] | |||||||
Floor rate (as a percent) | 0.00% | ||||||
LIBOR | Secured Debt | Term Loan Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 4.50% | ||||||
Floor rate (as a percent) | 1.00% | ||||||
LIBOR | Maximum | Revolving Credit Facility | Revolving Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 1.00% | ||||||
LIBOR | Maximum | Secured Debt | Term Loan Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 2.00% | ||||||
Fed Funds Effective Rate Overnight Index Swap Rate | Maximum | Revolving Credit Facility | Revolving Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 0.50% |
WARRANTS (Details)
WARRANTS (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Jun. 25, 2020 | |
Class of Warrant or Right [Line Items] | |||
Warrants outstanding (in shares) | 20,263,500 | ||
Exercise price of warrants or rights (in dollars per share) | $ 11.50 | ||
Expiration of warrants (in years) | 5 years | ||
Warrants exercised (in shares) | 200 | ||
Shares called upon exercise of warrants (in shares) | 100 | 2,631,750 | |
Common Class A | |||
Class of Warrant or Right [Line Items] | |||
Number of securities called by each warrant or right (in shares) | 0.50 | ||
Public Warrants | |||
Class of Warrant or Right [Line Items] | |||
Warrants outstanding (in shares) | 18,929,880 | 15,982,520 | 15,000,000 |
Redemption price (in dollars per share) | $ 0.01 | ||
Minimum prior written notice of redemption period | 30 days | ||
Trading days within trading day period | 20 days | ||
Trading day period | 30 days | ||
Last sale price of ordinary shares (in dollars per share) | $ 18 | ||
Private Placement | |||
Class of Warrant or Right [Line Items] | |||
Warrants outstanding (in shares) | 1,333,420 | 4,280,980 | 5,263,500 |
Period after closing of transaction | 30 days |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Fair Value Assumptions (Details) | Dec. 31, 2021$ / shares | Jun. 25, 2020 |
Class of Warrant or Right [Line Items] | ||
Warrant, term | 5 years | |
Private Placement | Asset price | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 10.74 | |
Private Placement | Exercise price | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 11.50 | |
Private Placement | Risk-free interest rate | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.0104 | |
Private Placement | Expected volatility | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.410 | |
Private Placement | Expected term (years) | ||
Class of Warrant or Right [Line Items] | ||
Warrant, term | 3 years 5 months 26 days | |
Private Placement | Dividend yield | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0 |
FAIR VALUE OF FINANCIAL INSTR_4
FAIR VALUE OF FINANCIAL INSTRUMENTS - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value Disclosures [Abstract] | ||
Warrant liabilities | $ 2,053 | $ 0 |
FAIR VALUE OF FINANCIAL INSTR_5
FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Changes in Fair Value of Warrants (Details) - Warrants and Rights Outstanding - Level 3 - Private Placement $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | $ 8,139 |
Transfer of Private Warrants to Public Warrants | (6,057) |
Change in fair value of warrant liabilities in 2021 | 1,132 |
Ending balance | 2,053 |
Restatement adjustment | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | $ (1,161) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | Dec. 31, 2021USD ($) |
Raw Materials | |
Long-term Purchase Commitment [Line Items] | |
Obligations to purchase raw materials | $ 60.9 |
Market Data Research, Technology Services and Capital Projects | |
Long-term Purchase Commitment [Line Items] | |
Obligations to purchase raw materials | 6.1 |
Obligations to purchase raw materials, current | 3.2 |
Obligations to purchase raw materials, noncurrent | $ 2.9 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax (Benefit) Provision (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Current: | ||||
Federal | $ (969) | $ 51 | $ 916 | $ 1,972 |
State and local | 54 | 16 | 283 | 197 |
Foreign | 1,139 | 2,029 | 3,957 | 5,865 |
Total current expense (benefit) | 224 | 2,096 | 5,156 | 8,034 |
Deferred: | ||||
Federal | (2,192) | (4,262) | (6,498) | (1,802) |
State and local | 138 | (259) | (2,801) | 336 |
Foreign | (788) | (1,057) | (3,001) | (9,034) |
Total deferred (benefit) expense | (2,842) | (5,578) | (12,300) | (10,500) |
Total benefit for income taxes | $ (2,618) | $ (3,482) | $ (7,144) | $ (2,466) |
INCOME TAXES - Effective Income
INCOME TAXES - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
(Loss) income before income taxes: | ||||
Domestic | $ (18,981) | $ (49,477) | $ (36,205) | $ 10,859 |
Foreign | 7,926 | 11,859 | 29,144 | 17,487 |
(Loss) income before income taxes | $ (11,055) | $ (37,618) | $ (7,061) | $ 28,346 |
Federal income tax rate (as a percent) | 21.00% | 21.00% | 21.00% | 21.00% |
Federal income taxes | $ (2,322) | $ (7,900) | $ (1,483) | $ 5,953 |
State and local taxes | 1,812 | (278) | (3,572) | 426 |
Foreign rate differential | (70) | (125) | (1,431) | 789 |
Change in tax rates | 735 | 0 | 225 | (2,209) |
Change in uncertain tax positions | 40 | (651) | (1,005) | 64 |
Change in valuation allowance | (1,474) | 883 | 2,657 | 588 |
Goodwill impairment | 0 | 3,717 | 0 | 0 |
Impact of Luxembourg restructuring | 0 | 0 | 0 | (6,438) |
U.S. effects of international operations | 320 | 2,084 | 3,041 | 3,079 |
Tax credits | (2,161) | (1,201) | (2,763) | (5,233) |
Section 162(m) limitation | 0 | 0 | 206 | 0 |
Transaction costs | 0 | 0 | 385 | 0 |
Stock-based compensation | 0 | 0 | 502 | 0 |
Switzerland tax ruling | 0 | 0 | (4,057) | 0 |
Foreign withholding taxes | 0 | 0 | 350 | 0 |
Other | 502 | (11) | (199) | 515 |
Total benefit for income taxes | $ (2,618) | $ (3,482) | $ (7,144) | $ (2,466) |
Effective tax rate (as a percent) | 23.70% | 9.30% | 101.20% | (8.70%) |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets: | ||
Accounts receivable | $ 381 | $ 473 |
Accrued expenses | 5,251 | 3,838 |
Inventory | 6,166 | 5,231 |
Other assets | 930 | 160 |
Pension asset | 365 | 348 |
Lease accounting | 7,558 | 3,360 |
U.S. and foreign net operating losses | 17,433 | 13,998 |
Deferred interest expense | 6,106 | 0 |
Tax credits | 511 | 254 |
Total deferred tax assets | 44,701 | 27,662 |
Less valuation allowance | (12,184) | (9,879) |
Net deferred tax assets | 32,517 | 17,783 |
Deferred tax liabilities: | ||
Property, plant and equipment | (5,271) | (4,678) |
Operating lease right-of-use asset | (6,553) | (2,747) |
Intangible assets | (46,511) | (24,266) |
Deferred rent | (59) | (78) |
Unremitted earnings | (965) | (719) |
Other liabilities | (6,255) | (5,921) |
Total deferred tax liabilities | (65,614) | (38,409) |
Net deferred tax liability | $ (33,097) | $ (20,626) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Income Tax Examination [Line Items] | ||||
Foreign tax credits | $ 500 | |||
State net operating loss carry forwards | 9,300 | |||
Foreign net operating loss carry forwards | 2,400 | |||
Increase in valuation allowance | 2,300 | |||
Change in valuation allowance | $ (1,474) | $ 883 | 2,657 | $ 588 |
Switzerland tax ruling | 0 | 0 | (4,057) | $ 0 |
Accrued income taxes | 1,700 | 1,800 | ||
Accrued interest and penalties related to uncertain tax positions | $ 600 | $ 400 | 100 | |
State and Local Jurisdiction | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards | 121,900 | |||
Domestic Tax Authority | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards | 500 | |||
Mexican Tax Authority | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards | 1,600 | |||
Luxembourg Inland Revenue | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards | 5,900 | |||
Ministry of Finance, India | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards | 2,200 | |||
State Administration of Taxation, China | ||||
Income Tax Examination [Line Items] | ||||
Operating loss carryforwards | $ 1,000 |
INCOME TAXES - Changes in Unrec
INCOME TAXES - Changes in Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning of the year | $ 539 | $ 895 | $ 609 |
Lapse in statute of limitations | 0 | (291) | (507) |
Currency differences | (65) | (8) | |
Currency differences | 70 | ||
End of the year | $ 609 | $ 539 | $ 94 |
PENSION AND OTHER RETIREMENTS_3
PENSION AND OTHER RETIREMENTS BENEFITS - Narrative (Details) $ in Thousands | Feb. 11, 2022USD ($) | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($)participant | Dec. 31, 2020USD ($) | Jun. 25, 2020USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2019USD ($) |
Defined Benefit Plan Disclosure | |||||||
Number of participants receiving settlement | participant | 125 | ||||||
Lump sum payments | $ 16,800 | ||||||
Pre-tax settlement gain | 500 | ||||||
Pension benefit obligation | 20,314 | $ 41,112 | $ 39,879 | $ 20,314 | $ 37,854 | ||
Net pension asset (liability) | (7,412) | (8,054) | (9,205) | (7,412) | |||
Total pension plan assets measured at fair value | 12,902 | 33,058 | 30,674 | 12,902 | 30,213 | ||
Net periodic benefit cost | (169) | 126 | (808) | 2,438 | |||
Defined contribution plan, cost | 200 | 300 | 1,000 | 300 | |||
Subsequent Event | |||||||
Defined Benefit Plan Disclosure | |||||||
Lump sum payments | $ 9,500 | ||||||
Forecast | |||||||
Defined Benefit Plan Disclosure | |||||||
Pre-tax settlement gain | $ 900 | ||||||
Nonqualified Plan | |||||||
Defined Benefit Plan Disclosure | |||||||
Pension benefit obligation | 9,800 | 10,300 | 9,800 | ||||
Foreign Plan | |||||||
Defined Benefit Plan Disclosure | |||||||
Pension benefit obligation | 6,900 | 6,300 | 6,900 | ||||
Net pension asset (liability) | (3,600) | (3,300) | (3,600) | ||||
Total pension plan assets measured at fair value | $ 3,400 | 3,000 | 3,400 | ||||
Net periodic benefit cost | $ 200 | $ 300 | $ 400 | $ 300 |
PENSION AND OTHER RETIREMENTS_4
PENSION AND OTHER RETIREMENTS BENEFITS - Funded Status of Company's Defined Benefit Pension Plans (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | ||||
Accumulated benefit obligations | $ 41,112 | $ 39,792 | $ 20,314 | |
Changes in projected benefit obligations: | ||||
Projected benefit obligations at beginning of year | 39,879 | 37,854 | 41,112 | |
Service cost | 94 | 41 | 63 | $ 692 |
Interest cost | 545 | 593 | 1,047 | 1,410 |
Actuarial (gain) loss | 1,568 | 1,826 | (1,054) | |
Benefits paid | (974) | (435) | (20,854) | |
Projected benefit obligations at end of year | 41,112 | 39,879 | 20,314 | 37,854 |
Change in plans’ assets: | ||||
Fair value of plans’ assets at beginning of year | 30,674 | 30,213 | 33,058 | |
Actual returns on plans’ assets | 3,195 | 732 | 372 | |
Employee contributions | 163 | 163 | 326 | |
Benefits paid | (974) | (434) | (20,854) | |
Fair value of plans’ assets at end of year | 33,058 | 30,674 | 12,902 | $ 30,213 |
Net pension liability | $ (8,054) | $ (9,205) | $ (7,412) | |
Defined Benefit Plan, Type [Extensible List] | Pension Plan [Member] |
PENSION AND OTHER RETIREMENTS_5
PENSION AND OTHER RETIREMENTS BENEFITS - Schedule of Amounts Recognized in Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 25, 2020 |
Retirement Benefits [Abstract] | |||
Other assets | $ 2,367 | $ 2,238 | $ 512 |
Accrued expenses and other current liabilities | (488) | (374) | (373) |
Other liabilities | (9,291) | (9,918) | (9,344) |
Net amount recognized | $ (7,412) | $ (8,054) | $ (9,205) |
PENSION AND OTHER RETIREMENTS_6
PENSION AND OTHER RETIREMENTS BENEFITS - Net Periodic Cost Not yet Recognized (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 25, 2020 |
Retirement Benefits [Abstract] | |||
Prior service cost | $ 0 | $ 0 | $ 169 |
Net actuarial (gain) loss | (207) | (620) | 13,997 |
Net amount recorded in AOCI | $ (207) | $ (620) | $ 14,166 |
PENSION AND OTHER RETIREMENTS_7
PENSION AND OTHER RETIREMENTS BENEFITS - Amounts Recognized in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Net actuarial loss | $ 0 | $ 1,912 | $ 527 |
Amortization of prior service costs | 0 | (33) | 0 |
Amortization of actuarial loss | 0 | (276) | (36) |
Total loss recognized in other comprehensive income | $ 0 | $ 1,603 | $ 491 |
PENSION AND OTHER RETIREMENTS_8
PENSION AND OTHER RETIREMENTS BENEFITS - Components of Net Periodic Benefit (Credit) Expense (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | ||||
Service cost | $ 94 | $ 41 | $ 63 | $ 692 |
Interest cost | 545 | 593 | 1,047 | 1,410 |
Expected return on plan assets | (783) | (817) | (1,310) | (1,462) |
Amortization of prior service cost | 0 | 33 | 0 | 149 |
Amortization of net actuarial loss | 0 | 276 | 36 | 1,332 |
Settlement/curtailment (income) expense | (25) | 0 | (644) | 317 |
Net periodic benefit (credit) cost | $ (169) | $ 126 | $ (808) | $ 2,438 |
PENSION AND OTHER RETIREMENTS_9
PENSION AND OTHER RETIREMENTS BENEFITS - Net Periodic Benefit Costs Reflected in the Company's Financial Statements (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure | ||||
Net periodic benefit (credit) cost | $ (169) | $ 126 | $ (808) | $ 2,438 |
Cost of goods sold | ||||
Defined Benefit Plan Disclosure | ||||
Net periodic benefit (credit) cost | 0 | 0 | 0 | 614 |
Selling, general and administrative expense | ||||
Defined Benefit Plan Disclosure | ||||
Net periodic benefit (credit) cost | 69 | 41 | 63 | 1,824 |
Other income (expense), net | ||||
Defined Benefit Plan Disclosure | ||||
Net periodic benefit (credit) cost | $ (238) | $ 85 | $ (871) | $ 0 |
PENSION AND OTHER RETIREMENT_10
PENSION AND OTHER RETIREMENTS BENEFITS - Assumptions for Benefit Obligations (Details) | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | |
Minimum | |||
Weighted-average assumptions used to determine net periodic benefit cost: | |||
Duration annuity purchase contract, period | 7 years | ||
Maximum | |||
Weighted-average assumptions used to determine net periodic benefit cost: | |||
Duration annuity purchase contract, period | 15 years | ||
Defined Benefit Plan, Funded Plan | |||
Weighted-average assumptions used to determine benefit obligation at year end: | |||
Discount rate | 2.61% | 2.85% | 2.38% |
Weighted-average assumptions used to determine net periodic benefit cost: | |||
Discount rate | 2.85% | 3.25% | 2.61% |
Expected long-term rate of return on plan assets | 5.25% | 5.50% | 4.90% |
Defined Benefit Plan, Unfunded Plan | |||
Weighted-average assumptions used to determine benefit obligation at year end: | |||
Discount rate | 2.42% | 2.64% | 2.78% |
Rate of compensation increase | 3.50% | 3.50% | 3.50% |
Weighted-average assumptions used to determine net periodic benefit cost: | |||
Discount rate | 2.64% | 3.25% | 2.42% |
Rate of compensation increase | 3.50% | 3.50% | 3.50% |
PENSION AND OTHER RETIREMENT_11
PENSION AND OTHER RETIREMENTS BENEFITS - Target Allocation of Plan Assets (Details) | Dec. 31, 2021 |
Minimum | Cash and cash equivalents | |
Defined Benefit Plan Disclosure | |
Asset classes, target ranges (as a percent) | 0.00% |
Minimum | Fixed income securities | |
Defined Benefit Plan Disclosure | |
Asset classes, target ranges (as a percent) | 45.00% |
Minimum | Equity securities | |
Defined Benefit Plan Disclosure | |
Asset classes, target ranges (as a percent) | 0.00% |
Maximum | Cash and cash equivalents | |
Defined Benefit Plan Disclosure | |
Asset classes, target ranges (as a percent) | 17.00% |
Maximum | Fixed income securities | |
Defined Benefit Plan Disclosure | |
Asset classes, target ranges (as a percent) | 100.00% |
Maximum | Equity securities | |
Defined Benefit Plan Disclosure | |
Asset classes, target ranges (as a percent) | 28.00% |
PENSION AND OTHER RETIREMENT_12
PENSION AND OTHER RETIREMENTS BENEFITS - Fair Value of Plan Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2019 |
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | $ 12,902 | $ 33,058 | $ 30,674 | $ 30,213 |
Level 1, 2 and 3 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 12,891 | 23,026 | ||
Level 1, 2 and 3 | Cash and cash equivalents | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 325 | 419 | ||
Level 1, 2 and 3 | Mutual funds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 5,816 | |||
Level 1, 2 and 3 | U.S. Government securities | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 6,283 | 3,087 | ||
Level 1, 2 and 3 | Municipal/provincial bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 296 | |||
Level 1, 2 and 3 | Corporate bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 6,283 | 13,408 | ||
Level 1 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 325 | 5,793 | ||
Level 1 | Cash and cash equivalents | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 325 | 419 | ||
Level 1 | Mutual funds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 5,374 | |||
Level 1 | U.S. Government securities | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
Level 1 | Municipal/provincial bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | |||
Level 1 | Corporate bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
Level 2 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 12,566 | 17,233 | ||
Level 2 | Cash and cash equivalents | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
Level 2 | Mutual funds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 442 | |||
Level 2 | U.S. Government securities | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 6,283 | 3,087 | ||
Level 2 | Municipal/provincial bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 296 | |||
Level 2 | Corporate bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 6,283 | 13,408 | ||
Level 3 | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
Level 3 | Cash and cash equivalents | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
Level 3 | Mutual funds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | |||
Level 3 | U.S. Government securities | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
Level 3 | Municipal/provincial bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | |||
Level 3 | Corporate bonds | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | 0 | 0 | ||
NAV | ||||
Defined Benefit Plan Disclosure | ||||
Total pension plan assets measured at fair value | $ 11 | $ 10,032 |
PENSION AND OTHER RETIREMENT_13
PENSION AND OTHER RETIREMENTS BENEFITS - Projected Benefit Payments (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Qualified Plan | |
Defined Benefit Plan Disclosure | |
2022 | $ 535 |
2023 | 515 |
2024 | 514 |
2025 | 507 |
2026 | 501 |
2027-2031 | 2,572 |
Nonqualified Plan | |
Defined Benefit Plan Disclosure | |
2022 | 488 |
2023 | 482 |
2024 | 497 |
2025 | 503 |
2026 | 563 |
2027-2031 | $ 2,922 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) | Jun. 24, 2020 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation expense | $ 8,700,000 | $ 1,300,000 | ||
Tax benefit recognized related to stock-based compensation | $ 0 | $ 500,000 | ||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in dollars per share) | $ 8.34 | $ 13.48 | ||
Aggregate fair value of awards vested | $ 7,200,000 | |||
Vested during period (in shares) | 0 | 582,503 | ||
Restricted Stock Units (RSUs) | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 1 year | |||
Restricted Stock Units (RSUs) | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Restricted Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 24 months | |||
Granted (in dollars per share) | $ 8.34 | $ 11.77 | ||
Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Granted (in dollars per share) | $ 13.65 | |||
Management Bonuses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock compensation expense | $ 900,000 | |||
2020 Long-Term Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of common shares authorized (in shares) | 9,300,000 |
STOCK-BASED COMPENSATION - Acti
STOCK-BASED COMPENSATION - Activity Related to RSUs and RSAs (Details) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2021 |
Restricted Stock Units (RSUs) | ||||
Shares | ||||
Beginning balance, outstanding (in shares) | 633,057 | |||
Granted (in shares) | 576,687 | |||
Vested (in shares) | 0 | (582,503) | ||
Forfeited (in shares) | (142,497) | |||
Ending balance, outstanding and nonvested (in shares) | 484,744 | 633,057 | 633,057 | 484,744 |
Weighted Average Grant Date Fair Value (per share) | ||||
Beginning balance, outstanding (in dollars per share) | $ 8.34 | |||
Granted (in dollars per share) | $ 8.34 | 13.48 | ||
Vested (in dollars per share) | 8.34 | |||
Forfeited (in dollars per share) | 11.70 | |||
Ending balance, outstanding and nonvested (in dollars per share) | $ 13.46 | $ 8.34 | $ 8.34 | $ 13.46 |
Weighted Average Remaining Contractual Term (in years) | ||||
Beginning balance (in years) | 1 year 7 days | 10 months 17 days | ||
Ending balance (in years) | 1 year 7 days | 10 months 17 days | ||
Restricted Stock | ||||
Shares | ||||
Beginning balance, outstanding (in shares) | 68,946 | |||
Granted (in shares) | 48,855 | |||
Ending balance, outstanding and nonvested (in shares) | 117,801 | 68,946 | 68,946 | 117,801 |
Weighted Average Grant Date Fair Value (per share) | ||||
Beginning balance, outstanding (in dollars per share) | $ 8.34 | |||
Granted (in dollars per share) | $ 8.34 | 11.77 | ||
Ending balance, outstanding and nonvested (in dollars per share) | $ 9.76 | $ 8.34 | $ 8.34 | $ 9.76 |
Weighted Average Remaining Contractual Term (in years) | ||||
Beginning balance (in years) | 11 months 23 days | 1 year 3 months 29 days | ||
Ending balance (in years) | 11 months 23 days | 1 year 3 months 29 days | ||
Performance Shares | ||||
Shares | ||||
Beginning balance, outstanding (in shares) | 0 | |||
Granted (in shares) | 323,555 | |||
Forfeited (in shares) | (41,414) | |||
Ending balance, outstanding and nonvested (in shares) | 282,141 | 0 | 0 | 282,141 |
Weighted Average Grant Date Fair Value (per share) | ||||
Beginning balance, outstanding (in dollars per share) | $ 0 | |||
Granted (in dollars per share) | 13.65 | |||
Forfeited (in dollars per share) | 13.65 | |||
Ending balance, outstanding and nonvested (in dollars per share) | $ 13.65 | $ 0 | $ 0 | $ 13.65 |
Weighted Average Remaining Contractual Term (in years) | ||||
Beginning balance (in years) | 2 years 2 months 15 days | |||
Ending balance (in years) | 2 years 2 months 15 days |
STOCK-BASED COMPENSATION - Unre
STOCK-BASED COMPENSATION - Unrecognized Compensation Cost on Nonvested Awards (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Share-based Payment Arrangement [Abstract] | |
Unrecognized Compensation Cost | $ 7,694 |
Weighted Avg. Remaining Recognition Period (in years) | 1 year 4 months 24 days |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) | Sep. 08, 2020 | Dec. 31, 2021 |
Equity [Abstract] | ||
Stock repurchase program, authorized amount | $ 20,000,000 | |
Stock repurchase program, period in force | 12 months | |
Stock repurchased during period | $ 0 |
EARNINGS PER SHARE - Computatio
EARNINGS PER SHARE - Computation of Basic and Diluted (Loss) Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
EPS numerator: | ||||
Net income (loss) attributable to common shareholders | $ (8,437) | $ (34,136) | $ 83 | $ 30,812 |
Less: Change in fair value of warrant liabilities | 0 | (29) | ||
Numerator - diluted | $ (8,437) | $ 54 | ||
EPS denominator: | ||||
Weighted average shares outstanding - basic (in shares) | 38,426,669 | 38,505,458 | ||
Effect of dilutive securities (in shares) | 0 | 1,370,929 | ||
Weighted average shares outstanding - diluted (in shares) | 38,426,669 | 39,876,387 | ||
Net earnings (loss) per share: | ||||
Basic (in dollars per share) | $ (0.22) | $ 0 | ||
Diluted (in dollars per share) | $ (0.22) | $ 0 |
EARNINGS PER SHARE - Narrative
EARNINGS PER SHARE - Narrative (Details) | 6 Months Ended |
Dec. 31, 2020shares | |
Warrant | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 20,263,500 |
Restricted Stock Units (RSUs) | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 633,057 |
Restricted Stock | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 68,946 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Change in the Components of Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands | Jun. 26, 2020 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 |
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | $ 233,666 | $ 233,666 | $ 487,750 | $ 308,846 |
Other comprehensive income (loss) before reclassifications | 8,630 | (2,286) | 1,685 | |
Amounts reclassified from AOCI | (25) | 318 | (603) | |
Purchase accounting adjustments to eliminate Predecessor’s accumulated other comprehensive (loss) income | 10,027 | |||
Ending balance | 308,846 | 233,666 | 313,871 | |
Predecessors | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | 439,722 | 439,722 | ||
Ending balance | 439,722 | |||
Total Accumulated Other Comprehensive Income (Loss) | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | 0 | 0 | (8,059) | 8,605 |
Ending balance | 0 | 8,605 | 0 | 9,687 |
Total Accumulated Other Comprehensive Income (Loss) | Predecessors | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | (10,027) | (10,027) | ||
Ending balance | (10,027) | |||
Net Currency Translation Gains (Losses) | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | 2,885 | 7,774 | ||
Other comprehensive income (loss) before reclassifications | 7,774 | (2,286) | 984 | |
Amounts reclassified from AOCI | 0 | 0 | 0 | |
Purchase accounting adjustments to eliminate Predecessor’s accumulated other comprehensive (loss) income | (599) | |||
Ending balance | 0 | 7,774 | 8,758 | |
Net Currency Translation Gains (Losses) | Predecessors | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | 599 | 599 | ||
Ending balance | 599 | |||
Funded Status of Benefit Plans | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | (10,944) | 831 | ||
Other comprehensive income (loss) before reclassifications | 856 | 0 | 701 | |
Amounts reclassified from AOCI | (25) | 318 | (603) | |
Purchase accounting adjustments to eliminate Predecessor’s accumulated other comprehensive (loss) income | 10,626 | |||
Ending balance | 0 | 831 | $ 929 | |
Funded Status of Benefit Plans | Predecessors | ||||
AOCI Attributable to Parent, Net of Tax | ||||
Beginning balance | $ (10,626) | $ (10,626) | ||
Ending balance | $ (10,626) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||
Mar. 31, 2018 | Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | Jul. 31, 2020 | |
Wesco US LLC | ||||||
Related Party Transaction [Line Items] | ||||||
Interest expense | $ 200,000 | $ 500,000 | ||||
Wesco US LLC | Revolving Credit Facility | ||||||
Related Party Transaction [Line Items] | ||||||
Maximum outstanding borrowings | $ 9,000,000 | |||||
Remaining balance forgiven | $ 3,400,000 | |||||
Wesco US LLC | LIBOR | Revolving Credit Facility | ||||||
Related Party Transaction [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 4.00% | |||||
Watermill | ||||||
Related Party Transaction [Line Items] | ||||||
Due to related parties | $ 900,000 | |||||
Related party expenses | $ 400,000 | $ 500,000 | ||||
Watermill | Wholesome | ||||||
Related Party Transaction [Line Items] | ||||||
Related party expenses | 2,000,000 | |||||
Watermill | Swerve | ||||||
Related Party Transaction [Line Items] | ||||||
Related party expenses | $ 800,000 | |||||
Limited Liability Company | ||||||
Related Party Transaction [Line Items] | ||||||
Due to related parties | 300,000 | |||||
Related party expenses | $ 900,000 | |||||
Limited Liability Company | WS Services | ||||||
Related Party Transaction [Line Items] | ||||||
Interest in partnership (as a percent) | 50.00% | |||||
Limited Liability Company | WS Services | Other assets | ||||||
Related Party Transaction [Line Items] | ||||||
Equity method investments | $ 700,000 |
BUSINESS SEGMENTS - Narrative (
BUSINESS SEGMENTS - Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($)segment | |
Concentration Risk [Line Items] | |
Number of reportable segments | segment | 2 |
One Customer | Revenue from Contract with Customer Benchmark | Customer Concentration Risk | Branded CPG | |
Concentration Risk [Line Items] | |
Concentration risk (as a percent) | 10.60% |
Uzbekistan Manufacturer | Cost of Goods and Service, Product and Service Benchmark | Supplier Concentration Risk | |
Concentration Risk [Line Items] | |
Purchases | $ | $ 15.6 |
Concentration risk (as a percent) | 41.80% |
BUSINESS SEGMENTS - Selected Fi
BUSINESS SEGMENTS - Selected Financial Information Relating to the Business' Reportable Segments (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | ||||
Product revenues, net | $ 147,168 | $ 128,328 | $ 493,973 | $ 272,123 |
Operating income (loss) | (6,106) | (38,181) | 22,816 | 29,676 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Operating income (loss) | 10,818 | (28,773) | 56,778 | 39,196 |
Corporate, Non-Segment | ||||
Segment Reporting Information [Line Items] | ||||
Operating income (loss) | (16,924) | (9,408) | (33,962) | (9,520) |
Branded CPG | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 96,857 | 80,749 | 389,174 | 165,863 |
Operating income (loss) | 13,463 | (5,055) | 34,918 | 19,800 |
Flavors & Ingredients | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 50,311 | 47,579 | 104,799 | 106,260 |
Flavors & Ingredients | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 50,311 | 47,579 | 104,799 | 106,260 |
Operating income (loss) | $ (2,645) | $ (23,718) | $ 21,860 | $ 19,396 |
BUSINESS SEGMENTS - Revenues Di
BUSINESS SEGMENTS - Revenues Disaggregated by Geographic Operating Segments (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 25, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | ||||
Product revenues, net | $ 147,168 | $ 128,328 | $ 493,973 | $ 272,123 |
North America | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 63,386 | 54,253 | 318,958 | 104,788 |
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 45,608 | 42,776 | 96,013 | 93,508 |
India, Middle East and Africa | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 6,996 | 3,959 | 14,801 | 12,888 |
Asia-Pacific | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | 24,350 | 20,834 | 51,598 | 46,845 |
Latin America | ||||
Segment Reporting Information [Line Items] | ||||
Product revenues, net | $ 6,828 | $ 6,506 | $ 12,603 | $ 14,094 |
BUSINESS SEGMENTS - Long-Lived
BUSINESS SEGMENTS - Long-Lived Assets Disaggregated by Geographic Operating Segments (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 58,503 | $ 47,285 |
United States | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 24,327 | 14,798 |
China | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 15,620 | 14,207 |
Czech Republic | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 6,074 | 6,070 |
France | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 11,353 | 11,076 |
Other Foreign Countries | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 1,129 | $ 1,134 |