Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 14, 2017 | Jun. 30, 2016 | |
Document And Entity Information | |||
Entity Registrant Name | LAPOLLA INDUSTRIES INC | ||
Entity Central Index Key | 875,296 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 38,678,186 | ||
Entity Common Stock, Shares Outstanding | 122,366,001 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,016 |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash | $ 1,722,000 | $ 0 |
Trade Receivables, Net | 12,508,000 | 10,006,000 |
Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | 0 | 42,000 |
Inventories, Net | 6,610,000 | 8,174,000 |
Prepaid Expenses and Other Current Assets | 2,074,000 | 1,174,000 |
Total Current Assets | 22,914,000 | 19,396,000 |
Property, Plant and Equipment | 985,000 | 1,087,000 |
Other Assets: | ||
Goodwill | 4,235,000 | 4,235,000 |
Other Intangible Assets, Net | 1,180,000 | 1,197,000 |
Deposits and Other Non-Current Assets, Net | 81,000 | 94,000 |
Total Assets | 29,395,000 | 26,009,000 |
Current Liabilities: | ||
Accounts Payable | 6,741,000 | 6,384,000 |
Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts | 21,000 | 51,000 |
Accrued Expenses and Other Current Liabilities | 2,917,000 | 2,773,000 |
Total Current Liabilities | 9,679,000 | 9,208,000 |
Other Liabilities: | ||
Long-Term Debt, Net | 8,945,000 | 14,137,000 |
Accrued Interest – Note Payable – Related Party | 0 | 4,000 |
Deferred Tax Liability | 414,000 | 365,000 |
Total Liabilities | 19,038,000 | 23,714,000 |
Commitments and Contingencies | ||
Stockholders' Equity: | ||
Common Stock, $0.01 Par Value; 140,000,000 Shares Authorized; 122,125,072 and 119,839,566 Issued and Outstanding for 2015 and 2014, respectively. | 1,235,000 | 1,221,000 |
Additional Paid-In Capital | 93,600,000 | 91,930,000 |
Accumulated Deficit | (84,478,000) | (90,856,000) |
Total Stockholders' Equity | 10,357,000 | 2,295,000 |
Total Liabilities and Stockholders' Equity | $ 29,395,000 | $ 26,009,000 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Stockholders' Equity: | ||
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock shares authorized | 140,000,000 | 140,000,000 |
Common stock shares issued | 123,494,129 | 122,125,072 |
Common stock shares outstanding | 123,494,129 | 122,125,072 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | ||
Sales | $ 86,386,000 | $ 78,649,000 |
Cost of Sales | 61,345,000 | 60,264,000 |
Gross Profit | 25,041,000 | 18,385,000 |
Operating Expenses: | ||
Selling, General and Administrative | 15,087,000 | 13,933,000 |
Professional Fees | 1,186,000 | 1,158,000 |
Depreciation | 97,000 | 146,000 |
Amortization of Other Intangible Assets | 277,000 | 284,000 |
Consulting Fees | 597,000 | 809,000 |
Total Operating Expenses | 17,244,000 | 16,330,000 |
Operating Income | 7,797,000 | 2,055,000 |
Other (Income) Expense: | ||
Interest Expense | 885,000 | 1,319,000 |
Interest Expense – Related Party | 491,000 | 775,000 |
Interest Expense – Amortization of Discount | 120,000 | 181,000 |
Loss on Extinguishment of Debt | 306,000 | 0 |
Other, Net | (694,000) | (35,000) |
Total Other Expense | 1,108,000 | 2,240,000 |
Income (Loss) Before Income Taxes | 6,689,000 | (185,000) |
Income Tax Expense | 311,000 | 392,000 |
Net Income (Loss) | $ 6,378,000 | $ (577,000) |
Earnings Per Share, Basic | $ 0.05 | $ 0 |
Earnings Per Share, Diluted | $ 0.05 | $ 0 |
Weighted Average Shares Outstanding (in shares) | 122,812,680 | 121,283,000 |
Weighted Average Number of Shares Outstanding, Diluted | 123,297,069 | 121,283,000 |
Statements of Stockholders' Equ
Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated (Deficit) [Member] |
Beginning Balance, Shares at Dec. 31, 2014 | 119,840,000 | |||
Beginning Balance, Amount at Dec. 31, 2014 | $ 908 | $ 1,198 | $ 89,989 | $ (90,279) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net Loss | (577) | (577) | ||
Issuance of Common Stock, Shares | 2,286,000 | |||
Issuance of Common Stock | 0 | $ 23 | (23) | |
Share Based Compensation Expense | 1,229 | 1,229 | ||
Interest Expense – Related Party | 735 | 735 | ||
Ending Balance, Shares at Dec. 31, 2015 | 122,126,000 | |||
Ending Balance, Amount at Dec. 31, 2015 | 2,295 | $ 1,221 | 91,930 | (90,856) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net Loss | 6,378 | 6,378 | ||
Issuance of Common Stock, Shares | 1,369,000 | |||
Issuance of Common Stock | 0 | $ 14 | (14) | |
Share Based Compensation Expense | 988 | 988 | ||
Interest Expense – Related Party | 696 | 696 | ||
Ending Balance, Shares at Dec. 31, 2016 | 123,495,000 | |||
Ending Balance, Amount at Dec. 31, 2016 | $ 10,357 | $ 1,235 | $ 93,600 | $ (84,478) |
Statement of Cash Flows
Statement of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flows From Operating Activities | ||
Net Loss | $ 6,378,000 | $ (577,000) |
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by (Used in) Operating Activities: | ||
Depreciation | 265,000 | 358,000 |
Amortization of Other Intangible Assets | 277,000 | 284,000 |
Provision for Losses on Accounts Receivable | (16,000) | 297,000 |
Share Based Compensation Expense | 988,000 | 1,229,000 |
Interest Expense – Enhanced Notes PIK | 0 | 330,000 |
Interest Expense – Related Party | 491,000 | 775,000 |
Interest Expense – Amortization of Discount | 120,000 | 181,000 |
Deferred Income Tax Provision | 49,000 | 365,000 |
Gain on Disposal of Assets | (9,000) | (4,000) |
Loss on Extinguishment of Debt | 306,000 | 0 |
Loss on Foreign Currency Exchange | 14,000 | 60,000 |
Changes in Assets and Liabilities: | ||
Trade Receivables | (2,497,000) | (1,487,000) |
Inventories | 1,541,000 | (2,906,000) |
CostsAndEstimatedEarningsInExcessOfBillingsOnUncompletedContracts | (42,000) | 24,000 |
Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | (30,000) | 51,000 |
Prepaid Expenses and Other Current Assets | (900,000) | (65,000) |
Other Intangible Assets | (260,000) | (298,000) |
Deposits and Other Non-Current Assets | 34,000 | 187,000 |
Accounts Payable | 356,000 | (595,000) |
Accrued Expenses and Other Current Liabilities | 140,000 | 1,014,000 |
Net Cash Provided by (Used in) Operating Activities | 7,289,000 | (825,000) |
Cash Flows From Investing Activities | ||
Additions to Property, Plant and Equipment | (143,000) | (76,000) |
Proceeds from Lines of Credit | 10,953,000 | 0 |
Repayments of Lines of Credit | (1,953,000) | 0 |
Cash Flows From Financing Activities | ||
Proceeds from Revolver Loan | 54,996,000 | 83,858,000 |
Principal Repayments to Revolver Loan | (61,732,000) | (82,557,000) |
Proceeds from Note Payable – Related Party | 0 | 250,000 |
Principal Repayments to Note Payable - Related Party | 0 | (500,000) |
Principal Repayments to Note Payable - Enhanced Note | (7,688,000) | (150,000) |
Net Cash (Used in) Provided by Financing Activities | (5,424,000) | 901,000 |
Net Change In Cash | 1,722,000 | 0 |
Cash at Beginning of Year | 0 | 0 |
Cash at End of Year | 1,722,000 | 0 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash Payments for Income Taxes | 307,000 | 0 |
Cash Payments for Interest | 752,000 | 850,000 |
Supplemental Schedule of Non Cash Investing and Financing Activities: | ||
Issuances of Restricted Stock for Personal Guaranty by Related Party Classified as Interest Expense | 696,000 | 735,000 |
Accrued Interest – Related Party | $ 0 | $ 4,000 |
Summary of Organization, Basis
Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates, and Assumptions | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates, and Assumptions | Summary of Organization, Basis of Presentation, and Critical Accounting Policies Estimates and Assumptions This summary briefly describes the Company’s organization, basis of presentation, and critical accounting policies, estimates, and assumptions, which are presented to assist in understanding these financial statements. The financial statements and notes are representations of management who are responsible for their integrity and objectivity. The accounting policies used conform to Generally Accepted Accounting Principles (GAAP) in the United States of America and have been consistently applied in the preparation of these financial statements. Judgments and estimates of uncertainties are required in applying our accounting policies in many areas. However, application of the critical accounting policies discussed below requires management’s significant judgments, often as the result of the need to make estimates of matters that are inherently uncertain. If actual results were to differ materially from the estimates made, the reported results could be materially affected. Organization History The Company was incorporated in the state of Delaware on October 20, 1989 initially under the name of Natural Child Collection, Inc. and has undergone a variety of name changes and discontinued operations. For current operations, the Company acquired 100% of the capital stock of Infiniti Paint Co., Inc., a Florida corporation, effective September 1, 2001, which was engaged in the business of developing, marketing, selling, and distributing acrylic roof coatings, roof paints, polyurethane foam systems, sealants, and roof adhesives in the Southeastern United States (the "Infiniti Subsidiary"). On December 20, 2004, the Company changed its name from Urecoats Industries, Inc. to IFT Corporation. During the latter part of 2004, the Company's Infiniti Subsidiary built and began operating an acrylic coatings manufacturing plant in the Southeastern United States. On February 11, 2005, the Company acquired 100% of the capital stock of Lapolla Industries, Inc., an Arizona corporation, which was engaged in the business of manufacturing acrylic roof coatings and sealants, and distributing polyurethane foam systems in the Southwestern United States (the "Lapolla Subsidiary"). On April 1, 2005, the Company's Infiniti Subsidiary merged with and into the Lapolla Subsidiary whereas the existence of the Infiniti Subsidiary ceased. On October 1, 2005, the Company's Lapolla Subsidiary merged with and into the Company whereas the existence of the Lapolla Subsidiary ceased. On November 8, 2005, the Company changed its name from IFT Corporation to Lapolla Industries, Inc. Trade Receivables and Credit Risk Trade receivables are the primary financial instruments that may subject the Company to significant concentrations of credit risk. The Company’s trade receivables consist primarily of uncollateralized obligations from its diverse customer base, including personal guarantees when obtainable, due under normal trade terms, which generally require payment within 30 days of the invoice date. However, these payment terms may be extended in select cases and many customers do not pay within stated trade terms. The Company has a credit insurance policy in place covering most customer account balances. The Company evaluates the creditworthiness of its customers’ financial position and monitors accounts on a regular basis. Provisions to the allowance for doubtful accounts are reviewed quarterly and adjustments are made periodically (as circumstances warrant) based upon management’s best estimate of collectability of accounts. No customer represented more than 10% of sales for each of the years ended December 31, 2016 and 2015 . No customer represented more than 10% of trade receivables at December 31, 2016 or 2015 . As of the date of this report, the Company believes no significant concentration of credit risk exists. Goodwill and Other Intangible Assets Goodwill represents the excess of the cost over the fair value of net tangible and identifiable intangible assets of acquired businesses. Identifiable intangible assets acquired in business combinations are recorded based upon their fair value at the date of acquisition. According to GAAP, goodwill is required to be tested for impairment, on an annual basis and between annual tests in certain circumstances, and written down when impaired. The goodwill impairment test is performed by comparing the fair value of the associated reporting unit to its carrying value. GAAP also requires that intangible assets with estimable useful lives be amortized over their respective estimated lives to their estimated residual values, and reviewed for impairment, unless these lives are determined to be indefinite. Fair Value of Financial Instruments The Company adopted authoritative GAAP guidance regarding disclosures about fair value of financial instruments, which requires the disclosure of the fair value of off-and-on balance sheet financial instruments. Unless otherwise indicated, the fair values of all reported assets and liabilities, which represent financial instruments (none of which are held for trading purposes), approximate the carrying values of such amounts. The Company adopted authoritative GAAP guidance regarding fair value measurements, which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants at the measurement date. This guidance establishes three levels of inputs that may be used to measure fair value: (a) Level 1 - Quoted prices in active markets for identical assets or liabilities. (b) Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities; and (c) Level 3 - Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of assets or liabilities. The Company had no Level 1, 2, or 3 assets or liabilities at December 31, 2016 and 2015 , respectively. The carrying value of cash and cash equivalents, trade receivables and payables, prepaid expenses and other current assets, and other payables and accruals approximate fair value due to short period of time to maturity. Note 1 - Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates and Assumptions - continued. Litigation The Company is occasionally involved in legal proceedings in the normal course of business. The Company accrues a liability for such matters when it is probable that a liability has been incurred and the amount can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. The accrual for a litigation loss contingency might include, for example, estimates of potential damages, outside legal fees and other directly related costs expected to be incurred. Cash and Cash Equivalents The Company considers cash, checks, credit card and ACH payments deposited with financial institutions, with original maturities of three months or less, to be cash and cash equivalents. Fixed-Price Contracts The Company’s AirTight Division performs work under fixed-price contracts. The fixed-price contracts vary in length but are typically less than one year. In accordance with industry practice, the Company includes asset and liability accounts relating to fixed-price contracts, including related deferred income taxes, if applicable, in current assets and liabilities even when such amounts are realizable or payable over a period in excess of one year. Revenues from fixed-price contracts are recognized on the percentage-of-completion method, measured by the percentage of costs incurred to date to estimated total costs for each contract. Fixed-price contract costs include all direct material, labor costs, equipment and those indirect costs related to contract performance, such as indirect labor, supplies, tools, and repairs costs. General and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements may result in revisions to costs and income and are recognized in the period in which the revisions are determined. The asset "costs and estimated earnings in excess of billings on uncompleted contracts" represents revenues recognized in excess of amounts billed. The liability "billings in excess of costs and estimated earnings on uncompleted contracts" represents billings in excess of revenues recognized. Inventories Cost is determined on an actual and/or standard cost basis that approximates the first-in, first-out (FIFO) method using a perpetual inventory system. Inventories are valued at the lower of cost or market (replacement cost), which does not exceed net realizable value. Income Taxes The Company's provision for income taxes is determined using the U.S. federal statutory rate. The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities along with net operating losses and tax credit carryovers. The Company's net deferred tax asset was approximately $21.9 million and $27.4 million at December 31, 2016 and 2015 , respectively. The Company's federal income tax returns are open to audit under the statute of limitations for the years ended December 31, 2013 through 2015. The Company recorded a valuation allowance against the deferred tax asset of $22.3 million and $27.8 million at December 31, 2016 and 2015 , creating a deferred tax liability of $414,000 and $365,000 , respectively. The Company has no unrecognized income tax benefits. Accordingly, the annual effective tax rate is unaffected. Should the Company incur interest and penalties relating to tax uncertainties, such amounts would be classified as a component of interest expense and operating expense, respectively. At December 31, 2016 , the Company had no increase or decrease in unrecognized income tax benefits for the year. There was no accrued interest or penalties relating to tax uncertainties at December 31, 2016 . Unrecognized tax benefits are not expected to increase or decrease within the next twelve months. Depreciable Lives of Property, Plant and Equipment Property, plant and equipment is recorded at cost and depreciated using the straight-line method, which deducts equal amounts of the cost of each asset from earnings every year over its estimated economic useful life. Economic useful life is the duration of time an asset is expected to be productively employed by the Company, which may be less than its physical life. Assumptions on the following factors, among others, affect the determination of estimated economic useful life: wear and tear, obsolescence, technical standards, contract life, market demand, competitive position, raw material availability, and geographic location. The estimated economic useful life of an asset is monitored to determine its appropriateness, especially in light of changed business circumstances. For example, changes in technology and changes in the estimated future demand for products may result in a shorter estimated useful life than originally anticipated. In these cases, we would depreciate the remaining net book value over the new estimated remaining life, thereby increasing depreciation expense per year on a prospective basis. Net property, plant and equipment totaled $985,000 and depreciation expense totaled $265,000 as of and for the year ended December 31, 2016 . Net property, plant and equipment totaled $1.1 million and depreciation expense totaled $358,000 as of and for the year ended December 31, 2015 . Note 1 - Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates and Assumptions - continued. Impairment of Long-Lived Assets Property, Plant and Equipment Property, plant, and equipment held for use is grouped for impairment testing at the lowest level for which there is an identifiable cash flow. Impairment testing of the asset group occurs whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Such circumstances would include a significant decrease in the market value of a long-lived asset grouping, a significant adverse change in the manner in which the asset grouping is being used or in its physical condition, a history of operating or cash flow losses associated with the use of the asset grouping, or changes in the expected useful life of the long-lived assets. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by that asset group is compared to the carrying value to determine whether impairment exists. If an asset group is determined to be impaired, the loss is measured based on the difference between the asset group’s fair value and its carrying value. An estimate of the asset group’s fair value is based on the discounted value of its estimated cash flows. Assets to be disposed of by sale are reported at the lower of carrying amount or fair value less cost to sell. The assumptions underlying cash flow projections represent our best estimates at the time of the impairment review. Factors that we must estimate include industry and market conditions, sales volume and prices, costs to produce, etc. Changes in key assumptions or actual conditions that differ from estimates could result in an impairment charge. Management believes it uses reasonable and supportable assumptions when performing impairment reviews and cannot predict the occurrence of future events and circumstances that could result in impairment charges. There were no property, plant and equipment impairment charges recorded during the years ended December 31, 2016 or 2015 . Goodwill Goodwill represents the excess of the aggregate purchase price over the fair value of net tangible and identifiable intangible assets of an acquired business. Goodwill was $4.2 million at December 31, 2016 and 2015 . The Company operates two reporting units, Foam and Coatings. Disclosures related to goodwill are included in Note 8 to the financial statements. The Company evaluates goodwill for impairment on an annual basis, or more frequently if management believes indicators of impairment exist. Under generally accepted accounting principles, the Company has the option to perform a qualitative assessment to test for impairment of goodwill. If it is determined that it is more likely than not that the fair value of each reporting unit is greater than its carrying amount, there is no need to perform any further testing. However, if the Company concludes otherwise, then it is required to perform the first step of the two-step impairment test by calculating the fair value of each reporting unit and comparing the carrying value of each reporting unit to its estimated fair value. If the fair value of a reporting unit is greater than its carrying value then goodwill is not impaired; otherwise, the second step of the impairment test shall be performed to measure the amount of impairment loss. Based on the qualitative assessment performed as of December 31, 2016, the Company concluded that it was more likely than not that the fair value of its reporting units was greater than their carrying amount. Accordingly, no further testing was required. There were no goodwill impairment charges recorded during the years ended December 31, 2016 or 2015. Other Intangible Assets The Company had other intangible assets, net of $1.2 million at December 31, 2016 and 2015 , consisting of product formulations and trade names that were acquired as part of business combinations, and trademarks and approvals and certifications obtained as part of entering into new markets. Amortization of other intangible assets totaled $277,000 and $284,000 for the years ended December 31, 2016 and 2015 , respectively. Other intangible assets are tested for impairment as part of the long-lived asset grouping impairment tests. Impairment testing of the asset group occurs whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. See impairment discussion above under Property, Plant and Equipment for a description of how impairment losses are determined. Disclosures related to other intangible assets are included in Note 8 to the financial statements. Significant management judgment is required in the forecasts of future operating results that are used in the Company’s impairment evaluations. The estimates used are consistent with the plans and estimates that Management uses to manage its business. It is possible, however, that the plans may change and estimates used may prove to be inaccurate. If the Company’s actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, then the Company could incur future impairment charges, which would adversely affect financial performance. The Company concluded that there were no material events or significant changes in circumstances that led to impairment during fiscal 2016 and 2015. There were no long-lived asset impairment charges recorded during the years ended December 31, 2016 or 2015 . Revenue Recognition Sales are recognized (i) as risk and title to products transfers to the customer (which generally occurs at the time shipment is made), (ii) the sales price is fixed or determinable, and (iii) collectability is reasonably assured. Sales channels include direct sales, distributors, and independent representatives. Irrespective of the sales channel, returns and allowances are not a business practice in the industry. Amounts billed for shipping and handling are included in revenues (freight). Freight included in revenue was $834,000 and $958,000 in 2016 and 2015 , respectively. Costs incurred for shipping and handling are included in cost of sales. Freight included in cost of sales was $4.3 million and $4.2 million in 2016 and 2015 , respectively. Revenues are recorded net of sales tax. Note 1 - Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates and Assumptions - continued. Research and Development Research and development costs related to both future and present products are charged to operations as incurred. Share-Based Compensation The Company accounts for the cost of employee or director services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The fair value of share based awards is estimated at the grant date using a Black-Scholes valuation model and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period. The determination of fair value is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables, including expected stock price volatility, risk-free interest rate, expected dividends and projected employee stock option exercise behaviors. Employee stock option exercise behavior is based on actual historical exercise activity and assumptions regarding future exercise activity of unexercised, outstanding options. The Company applies an estimated forfeiture rate to unvested awards for the purpose of calculating compensation cost. These estimates are subject to revision in future periods if actual forfeitures differ from the estimates and changes impact compensation cost in the period in which the change in estimate occurs. Disclosures related to share-based compensation are included in Note 17 to our financial statements. Share-based compensation expense was $988,000 and $1.2 million in 2016 and 2015 , respectively. If additional share based awards are granted, financial performance may be negatively affected, and if outstanding share based awards are forfeited or canceled, resulting in non-vesting of such stock awards, financial performance may be positively affected. In either instance, the Company’s financial performance may change depending on share based award activities in future periods. Allowance for Doubtful Accounts The Company presents trade receivables, net of allowances for doubtful accounts, to ensure trade receivables are not overstated due to uncollectible accounts. Allowances, when required, are calculated based on a detailed review of certain individual customer accounts, including credit insurance and other security when applicable, and an estimation of the overall economic conditions affecting our customer base. The Company reviews a customer’s credit history before extending credit. The allowance for doubtful accounts was approximately $366,000 and $545,000 at December 31, 2016 and 2015 , respectively. If the financial condition of customers were to deteriorate based on worsening overall economic conditions, resulting in an impairment of their ability to make payments to the Company, then additional allowances may be required in future periods. Cost of Sales and Selling, General and Administrative Costs The Cost of Sales line item includes all the material, overhead, packaging, and freight costs associated with products shipped, including resale finished goods and raw materials, as well as payroll costs associated with manufacturing the finished goods, inbound freight, sales tax expense, product containers, labels, and other miscellaneous items that are indirectly used in the manufacturing, packaging, and shipping (outbound freight) of finished goods, including inspection, and internal transfer costs, as well as depreciation of machinery, amortization of approvals and certifications, and an allocated portion of overhead. The Selling, General and Administrative line item includes selling, advertising, marketing, customer service, and technical support, as well as the costs of providing corporate functional support for all other areas of our business. Advertising and Marketing Expenses Advertising and marketing costs are generally expensed as they are incurred. Expenditures for certain advertising and marketing activities related to trade shows and trade magazines are deferred within the Company’s fiscal year when the benefits clearly extend beyond the interim period in which the expenditure is made, generally not to exceed 90 days. There were $181,000 and $ 116,000 costs for advertising deferred on the Company’s balance sheets as of December 31, 2016 and 2015 , respectively. Other advertising and marketing expenditures that do not meet the deferred criteria are expensed when the advertising and marketing occurs. Total advertising and marketing costs expensed were approximately $1.1 million in 2016 and 2015 , respectively. Debt Issuance Costs The Company capitalizes debt issuance costs, which are netted against long-term debt in the Company’s balance sheets. These costs are amortized over the term of the financial instrument. Amortization of debt issuance costs is included in “Interest Expense” in the statements of operations. Net Income (Loss) Per Common Share Basic income (loss) per share is based upon the net income (loss) applicable to common shares after preferred dividend requirements and upon the weighted average number of common shares outstanding during the period. Diluted income (loss) per share reflects the effect of the assumed exercise of stock options and warrants only in periods in which such effect would have been dilutive. Disclosures related to net income (loss) per common share are included in Note 15 to our financial statements. Note 1 - Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates and Assumptions - continued. Recently Adopted Accounting Standards In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-15, “ Presentation of Financial Statements—Going Concern: Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” The amendments in this ASU are intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. This ASU provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations in the financial statement footnotes. The pronouncement is effective for annual reporting periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. The Company adopted the provisions of the guidance in the fourth quarter of 2016. The adoption did not have a material impact on the Company’s financial statements. In January 2015, the FASB issued ASU 2015-01, “ Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” This ASU eliminates from GAAP the concept of extraordinary items and the need for an entity to separately classify, present, and disclose extraordinary events and transactions, while retaining certain presentation and disclosure guidance for items that are unusual in nature or occur infrequently. The pronouncement is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period and may be applied retrospectively, with early application permitted. The Company adopted the provisions of the guidance in the fourth quarter of 2015. The adoption did not have a material impact on the Company’s financial statements. In April 2015, the FASB issued ASU 2015-03, “ Simplifying the Presentation of Debt Issuance Costs. " The accounting guidance requires that debt issuance costs related to a recognized debt liability be reported on the Statements of Financial Condition as a direct deduction from the carrying amount of that debt liability. The pronouncement is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early application permitted for financial statements that have not been previously issued. The Company adopted the provisions of the guidance in the first quarter of 2016, and retrospectively for 2015. The adoption did not have a material impact on the Company’s financial statements. In November 2015, the FASB issued ASU 2015-17, " Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes ," which simplifies the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This ASU is effective for financial statements issued for annual periods beginning after December 16, 2016, and interim periods within those annual periods. The Company adopted the provisions of the guidance in the fourth quarter of 2016. The adoption did not have a material impact on the Company’s financial statements. There was not a need to retrospectively adjust prior periods. New Accounting Standards Not Yet Adopted In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, " Revenue from Contracts with Customers ." The ASU will supersede most of the existing revenue recognition requirements in U.S. generally accepted accounting principles ("GAAP") and will require entities to recognize revenue at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. The new standard also requires significantly expanded disclosures regarding the qualitative and quantitative information of an entity's nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The pronouncement is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period and is to be applied retrospectively, with early application not permitted. The Company is currently evaluating the impact of adopting this guidance. In July 2015, the FASB issued ASU 2015-11, "Inventory (Topic 330): Simplifying the Measurement of Inventory," which applies to inventory that is measured using first-in, first-out ("FIFO") or average cost. Under the updated guidance, an entity should measure inventory that is within scope at the lower of cost and net realizable value, which is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Subsequent measurement is unchanged for inventory that is measured using last-in, last-out ("LIFO"). This ASU is effective for annual and interim periods beginning after December 15, 2016, and should be applied prospectively with early adoption permitted at the beginning of an interim or annual reporting period. The Company is currently evaluating the impact of adopting this guidance. In January 2016, the FASB issued ASU 2016-01, " Financial Instruments--Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, " which amends the guidance in GAAP on the classification and measurement of financial instruments. Changes to the current guidance primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The new standard is effective for fiscal years and interim periods beginning after December 15, 2017, and upon adoption, an entity should apply the amendments by means of a cumulative-effect adjustment to the balance sheet at the beginning of the first reporting period in which the guidance is effective. Early adoption is not permitted except for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The Company is currently evaluating the impact of adopting this guidance. Note 1 - Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates and Assumptions - continued. In February 2016, the FASB issued ASU 2016-02, "Leases: Amendments to the FASB Accounting Standards Codification," which requires companies to recognize all leases as assets and liabilities on the consolidated balance sheet. This ASU retains a distinction between finance leases and operating leases, and the classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the current accounting literature. The result of retaining a distinction between finance leases and operating leases is that under the lessee accounting model, the effect of leases in a consolidated statement of comprehensive income and a consolidated statement of cash flows is largely unchanged from previous GAAP. The amendments are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Earlier application is permitted. The Company is currently evaluating the impact of adopting this guidance. In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," which simplifies several aspects of the accounting for share-based payment awards to employees, including the accounting for income taxes, forfeitures, statutory tax withholding requirements and classification |
Dependence on Few Suppliers
Dependence on Few Suppliers | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Dependence on Few Suppliers | Dependence on Few Suppliers The Company is dependent on a few suppliers for certain of its raw materials and finished goods. For 2016 and 2015 , raw materials and finished goods purchased from the Company’s three largest suppliers accounted for approximately 42% and 39% of purchases, respectively. |
Trade Receivables
Trade Receivables | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Trade Receivables | Trade Receivables Trade receivables are comprised of the following (in thousands): December 31, 2016 2015 Trade Receivables $ 12,874 $ 10,551 Less: Allowance for Doubtful Accounts (366 ) (545 ) Trade Receivables, Net $ 12,508 $ 10,006 |
Contracts
Contracts | 12 Months Ended |
Dec. 31, 2016 | |
Contractors [Abstract] | |
Contracts | Contracts The following is a summary of contracts in progress (in thousands): December 31, 2016 2015 Costs Incurred on Uncompleted Contracts $ 274 $ 1,089 Estimated Earnings on Uncompleted Contracts 83 306 Earned Revenues 357 1,395 Less: Billings to Date (378 ) (1,404 ) Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts $ (21 ) $ (9 ) Included in the accompanying balance sheets under the following captions as of December 31 (in thousands): 2016 2015 Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts $ — $ 42 Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts 21 51 Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts $ (21 ) $ (9 ) |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The following is a summary of inventories (in thousands): December 31, 2016 2015 Raw Materials $ 2,157 $ 2,599 Finished Goods 4,453 5,575 Inventories, Net $ 6,610 $ 8,174 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets The following is a summary of prepaid expenses and other current assets (in thousands): December 31, 2016 2015 Prepaid Insurances $ 735 $ 637 Prepaid Marketing 181 116 Prepaid Consulting 94 58 Prepaid Other 1,064 363 Total Prepaid Expenses and Other Current Assets $ 2,074 $ 1,174 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment The following is a summary of property, plant and equipment (in thousands): December 31, 2016 2015 Estimated Useful Life Vehicles $ 244 $ 462 5 Years Leasehold Improvements 269 289 13 – 15 Years Office Furniture and Equipment 159 307 3 – 7 Years Computers and Software 907 946 3 – 5 Years Machinery and Equipment 2,557 2,517 3 – 20 Years Total Property, Plant and Equipment $ 4,136 $ 4,521 Less: Accumulated Depreciation (3,151 ) (3,434 ) Total Property, Plant and Equipment, Net $ 985 $ 1,087 Depreciation expense was $265,000 and $358,000 for the years ended 2016 and 2015 , of which $168,000 and $212,000 were included in cost of sales for 2016 and 2015 , respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The following is a summary of Goodwill (in thousands): Goodwill December 31, 2016 2015 Foam $ 2,932 $ 2,932 Coatings 1,303 1,303 $ 4,235 $ 4,235 The following is a summary of Other Intangible Assets (in thousands): Other Intangible Assets December 31, 2016 2015 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Amortization Period Product Formulations $ 138 (104 ) $ 34 138 $ (95 ) 43 15 Years Trade Names 750 (419 ) 331 750 (369 ) 381 15 Years Approvals and Certifications 3,462 (2,647 ) 815 3,202 (2,429 ) 773 5 Years $ 4,350 $ (3,170 ) $ 1,180 $ 4,090 $ (2,893 ) $ 1,197 Based on the other intangible assets in service as of December 31, 2016 , estimated amortization expense for the years ending December 31, 2017 through December 31, 2021 and thereafter is as follows (in thousands): 2017 2018 2019 2020 2021 Thereafter Product Formulations $ 9 $ 9 $ 9 $ 7 $ — $ — Trade Names 50 50 50 50 50 81 Approvals and Certifications 205 205 205 200 — — $ 264 $ 264 $ 264 $ 257 $ 50 $ 81 |
Deposits and Other Non-Current
Deposits and Other Non-Current Assets, Net | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Deposits and Other Non-Current Assets, Net | Deposits and Other Non-Current Assets, Net The following is a summary of deposits and other non-current assets (in thousands): December 31, 2016 2015 Prepaid Expenses 8 25 Other Receivables 9 5 Deposits 64 64 Total Deposits and Other-Non-Current Assets $ 81 $ 94 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities The following is a summary of accrued expenses and other current liabilities as (in thousands): December 31, 2016 2015 Accrued Payroll $ 3 $ (6 ) Accrued Commissions 172 129 Accrued Inventory 249 438 Accrued Taxes and Other 1,990 1,725 Accrued Insurance 490 459 Deferred Finance Charge Income 13 28 Total Accrued Expenses and Other Current Liabilities $ 2,917 $ 2,773 |
Financing Instruments
Financing Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Financing Instruments | (a) Credit Agreement. The Company entered into a loan agreement with Bank of America, N.A. (the "Bank") on September 7, 2016 (the “Credit Agreement”), which amended and restated in its entirety that certain Loan and Security Agreement dated August 31, 2010 with the Bank (as amended, the "Loan Agreement"). The Credit Agreement provides an initial line of credit of $15 million for a 3 years term maturing on September 7, 2019 (the “Line of Credit”). The available amount of the Line of Credit will be reduced each quarter by $250,000 starting January 1, 2017, until it reaches $12 million on July 1, 2019, thereby reducing the Company’s unused line fee. The interest rate used by the Company is the daily floating LIBOR rate plus 2.25% . The Credit Agreement requires the Company to comply with two financial covenants, including: (i) an asset coverage ratio of at least (a) 1.10 to 1.00 from September 30, 2016, until September 30, 2017, (b) 1.15 to 1.00 from October 1, 2017, through March 31, 2018, and (c) 1.20 to 1.00 from April 1, 2018, and thereafter, tested quarterly, which in each case will be determined based upon the ratio of (x) 85% of book value of all accounts receivable, plus 55% of book value of all inventory, plus 50% net book value of plant, property and equipment of the Company (the "Total Margined Value") to (y) all outstanding liabilities for borrowed money and other interest-bearing liabilities arising under the Line of Credit (the "Total Line of Credit"); and (ii) a fixed charge coverage ratio of at least 1.20 to 1.00, tested quarterly based upon the ratio of (a) Adjusted EBITDA (as defined in the Credit Agreement), to (b) the sum of capital expenditures, cash taxes paid, interest expenses, principal payments made on borrowed money other than the Line of Credit and the Enhanced Notes (as defined in (c) below), and distributions made, in each case for the immediately preceding four fiscal quarter period and determined on a consolidated basis. Upon closing of the Credit Agreement, an aggregate of $8.5 million was drawn from the Line of Credit and used to pay off the Enhanced Notes and the Loan Agreement. The Company granted the Bank a continuing security interest in and lien upon substantially all assets of the corporation. If, at any time, the Company’s Total Margined Value is less than the amount outstanding under the Total Line of Credit, and that amount remains unpaid or future Total Margined Value calculations do not increase to an amount equal to the balance outstanding under the Total Line of Credit, the Bank, in its sole discretion, may accelerate any and all amounts outstanding under the Line of Credit. At December 31, 2016, the balance outstanding on the Line of Credit, net of deferred financing costs, was $9.7 million , and the weighted-average interest rate was 2.78% . Cash available under our Line of Credit based on the Asset Coverage Ratio, after giving effect to our outstanding borrowings, at December 31, 2016 was $3.2 million . At December 31, 2016, the Company was in compliance with all of its Credit Agreement debt covenants. Note 11 - Long-Term Debt - continued (b) Loan Agreement. The Company entered into the Loan Agreement with the Bank on September 1, 2010, which, as amended from time to time, provided for a $12 million Revolver Loan. The Loan Agreement was replaced in its entirety and the Revolver Loan provided in connection therewith, which had an outstanding balance of $2.7 million , was paid in full from a draw against our Line of Credit upon closing of the Credit Agreement with the Bank on September 7, 2016. At December 31, 2015, the balance outstanding on the Revolver Loan, net of deferred financing costs, was $6.7 million , and the weighted-average interest rate was 4.6% . Cash available under the Revolver Loan based on the borrowing base calculation (defined as an amount determined by a detailed calculation that includes an amount equal to 85% of eligible accounts receivable, 65% of eligible finished goods and 30% of eligible raw materials, up to $6 million ) at December 31, 2015 was $2.2 million . See also Item (a) above for more information. (c) Note Purchase Agreement . (i) Enhanced Notes . The Company entered into a Note Purchase Agreement with Enhanced Jobs for Texas Fund, LLC ("Enhanced Jobs") and Enhanced Credit Supported Loan Fund, LP ("Enhanced Credit"), on December 10, 2013, originally issuing an aggregate of $7.2 million in subordinated secured promissory notes maturing December 10, 2017 (the “Enhanced Notes”), of which $5.7 million was to Enhanced Credit and $1.5 million was to Enhanced Jobs. This Note Purchase Agreement was terminated and the Enhanced Notes issued in connection therewith, which had an aggregate outstanding balance, net of repayments plus accrued interest including PIK, of $5.8 million , were paid in full from a draw against our Line of Credit upon closing of the Credit Agreement with the Bank on September 7, 2016. Upon satisfaction and termination of the Note Purchase Agreement by the Company, the chairman of the board's commitment to ensure funding upon maturity of the Enhanced Notes and his personal guaranty on the Note Purchase Agreement were terminated. At December 31, 2015, the balance outstanding on the Enhanced Notes, net of deferred financing costs, was $7.5 million , and the effective interest rate was 25.6% . See also Item (a) above for more information. (ii) Guaranty Agreement . In connection with the Enhanced Notes described in (c)(i) above, the chairman of the board and majority stockholder of the Company (the “Guarantor”), entered into a Guaranty Agreement to secure the Company’s performance under the Enhanced Notes. The Company, in exchange for Guarantor’s personal guarantee of the obligations under the Enhanced Notes, granted Guarantor 3.7 million shares of common stock, par value $.01 per share, which shares vest monthly on a pro rata basis over the life of the Enhanced Notes (the “Guaranty Shares”). The Guaranty Shares were valued at $0.60 per share, the closing price of the Company’s common stock as quoted on OTC Markets on the day preceding the closing date of December 10, 2013, for an aggregate amount of $2.2 million . The Guaranty Shares were recorded as interest expense – related party, thereby increasing the effective interest rate of the Enhanced Notes. Upon repayment of the Enhanced Notes by the Company, the chairman of the board's personal guaranty on the Note Purchase Agreement terminated and all remaining unvested Guaranty Shares vested on an accelerated basis. At December 31, 2016 and 2015, there were 3,681,000 and 2,523,347 Guaranty Shares vested, valued and recorded at $2.2 million and $1.5 million , respectively. See also Item (a) above for more information. (iii) Chairman of the Board Commitment . On November 12, 2015, pursuant to a commitment letter, effective as of October 31, 2015 (the “Commitment”), the Company's chairman of the board and majority stockholder, Richard J. Kurtz, committed to ensure the Company had funding to pay off the aggregate amount of $7.2 million by August 31, 2016, plus any accrued and unpaid interest, outstanding with respect to the Enhanced Notes, of which $2 million is required from him by April 30, 2016 if the Company does not repay that amount ("the Commitment”). As consideration for the Commitment, the Company granted Mr. Kurtz a fully vested and exercisable stock option to purchase 500,000 shares of the Company’s common stock, with an exercise price per share equal to the fair market value of a share of the Company’s common stock on November 12, 2015, determined based on the per share closing price on such date, or $0.294 per share, for a term of eight (8) years. The transaction was valued at approximately $47,000 , which was estimated using the Black-Scholes option pricing model and fully expensed on the date of grant. In connection with the Company's payment of $500,000 in principal to Mr. Kurtz during the fourth quarter of 2015 for the Notes Payable - Related Party, Mr. Kurtz made a principal payment of $150,000 towards paying down the Enhanced Notes. The Company initially offset the $150,000 that Mr. Kurtz paid on its behalf direct to Enhanced against certain arms length sales transactions made to entities controlled by him for the Company's products; subsequently those amounts were paid by those entities and as a result, the Company repaid Mr. Kurtz the $150,000 paid to Enhanced on December 21, 2016. On April 21, 2016, the Company made a payment of $1.9 million on the outstanding principal of the Enhanced Notes. On August 25, 2016, Enhanced agreed to extend the August 31, 2016 pay off date for the Enhanced Notes to on or prior to September 16, 2016. On September 7, 2016, the Company repaid the Enhanced Notes and the chairman of the board's Commitment was terminated. See also Item (a) above for more information. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions (a) On January 1, 2015, Jomarc C. Marukot and the Company entered into an Executive Employment Agreement, dated as of January 1, 2015 (the “Marukot Agreement”), pursuant to which Mr. Marukot shall serve as the Company’s CFO and Corporate Treasurer for a term commencing on January 1, 2015 and ending December 31, 2016 (the “Employment Term”). Pursuant to the Marukot Agreement, Mr. Marukot is entitled to: (i) an annual base salary of $190,000 ; (ii) annual bonus equal to 25% of his annual base salary if the Company achieves its budgeted earnings before interest, taxes, depreciation, amortization, and share based compensation (“Adjusted EBITDA”) per calendar year, which annual bonus may be increased to 30% , 35% , or more than 35% in the CEO’s discretion, of his annual base salary if the Company achieves 110% , 120% , or more than 120% , respectively, of its budgeted Adjusted EBITDA; (iii) change in control bonus of 25% of his annual base salary upon consummation of a change in control if he is still employed at the time; (iv) medical, dental, life insurance, and disability benefits; (v) four months’ portion of his annual base salary for termination due to death or disability; (vi) four months’ portion of his annual base salary, awards and benefit plans and, if he would have received it had he remained employed for four months after his actual termination date, the change in control bonus in the event of termination without cause by the Company; and (vii) twelve months annual base salary if terminated within the first twelve months of the Employment Term or the remaining annual base salary if terminated after twelve months of his employment due to a change in control. Mr. Marukot is also entitled to earn awards under equity or other plans or programs that the Company, in its discretion, determines to put into effect and to participate in compensation and benefit programs offered by the Company to its executive officers. The Marukot Agreement also provides for a non-competition provision for the Employment Term and for a period of twelve months after the termination of Mr. Marukot’s employment. (b) On January 16, 2015, the Company granted Douglas J. Kramer, CEO and President, the right to acquire 850,000 shares of the Company’s common stock, $0.01 par value per share, at an exercise price per share equal to the fair market value of a share of the Company’s common stock on the date of grant, determined based on the per share closing price on such date, or $0.325 per share, which options were immediately vested and exercisable at the time of grant (“Kramer Option”). The Kramer Option was granted as final replacement for 2,000,000 stock options granted on July 12, 2005 which expired July 12, 2013 (the “Prior Expired Options”). The Prior Expired Options were inadvertently extended to December 31, 2015, however, due to an eight year life limitation under the Company’s Equity Incentive Plan, as amended (the “Equity Plan”), they were deemed canceled at the end of eight years. Moreover, the Equity Plan only permits the grant of a total of 2,000,000 stock options during any calendar year. Mr. Kramer had exceeded this limit during the 2014 year and as a result, the Company was only able to grant Mr. Kramer 1,150,000 stock options during the 2014 year as partial replacement for the 2,000,000 Prior Expired Options. The transaction was valued at $86,000 , which was estimated using the Black-Scholes option pricing model and expensed on the date of grant. (c) On January 16, 2015, the Company granted an eight -year stock option to Michael T. Adams, CGO, EVP, and Corporate Secretary, for 300,000 shares of the Company’s common stock, $0.01 par value per share, at an exercise price per share equal to the fair market value of a share of the Company’s common stock on the date of grant, determined based on the closing price on such date, or $0.325 per share (“Adams Option”). The Adams Option vests in three equal end of calendar year increments, subject to Mr. Adams meeting certain performance criteria, commencing on December 31, 2015 and ending December 31, 2017, or upon consummation of a change in control. Once vested, the stock options are immediately exercisable. The transaction was valued at $94,000 , which was estimated using the Black-Scholes option pricing model and will be expensed over the requisite vesting period. (d) On January 21, 2015, the Company borrowed $250,000 from the chairman of the board and majority stockholder as a condition precedent to entering into the Twelfth Amendment and entered into a promissory note (the “1/21/15 Kurtz Note”). Pursuant the 1/21/15 Kurtz Note, the Company agreed to pay 8% per annum on the principal balance of $250,000 and repay the principle balance on June 10, 2017. The 1/21/15 Kurtz Note is subordinated to the Loan Agreement and Enhanced Note. See also Item (e) below. (e) On January 23, 2015, the Company and Bank of America, N.A. entered into a Twelfth Amendment (the “Twelfth Amendment”) to the Loan Agreement. Pursuant to the Twelfth Amendment, certain definitions were changed and a new definition was added in the Loan Agreement as follows: (1) Fixed Charge Coverage Ratio was changed to the ratio, determined for any period on a consolidated basis for the Company, of (a) the sum of (i) EBITDA, (ii) Subordinated Debt incurred during such period on or after August 31, 2014 (other than the Twelfth Amendment Subordinated Debt), and (iii) up to $267,000 in Accounts charged off by the Company in August, 2014, to (b) the sum of Capital Expenditures (except those financed with Borrowed Money other than Revolver Loans), cash taxes paid, interest expense (other than payment-in-kind), principal payments made on Borrowed Money other than Revolver Loans, excluding (solely) principal payments made on the Subordinated Term Debt due December 10, 2013, in an amount not exceeding $150,000 , and Distributions made, in each case determined for such period; (2) Revolver Termination Date was changed (extended) to March 31, 2016; and (3) Subordinated Debt was added defining Subordinated Debt loaned to the Company by Richard Kurtz in an amount at least equal to $250,000 , required as a condition to the effectiveness of the Twelfth Amendment. Refer to Item (d) above for more information on the Subordinated Debt. (f) On March 23, 2015, the Company granted an eight -year stock option to Harvey L. Schnitzer, COO, for 300,000 shares of the Company’s common stock, $0.01 par value per share, at an exercise price per share equal to the fair market value of a share of the Company’s common stock on the date of grant, determined based on the closing price on such date, or $0.41 per share (“Schnitzer Option”). The Schnitzer Option vests in three equal end of calendar year increments, subject to Mr. Schnitzer meeting certain performance criteria, commencing on December 31, 2015 and ending December 31, 2017, or upon consummation of a change in control. Once vested, the stock options are immediately exercisable. The transaction was valued at $118,000 , which was estimated using the Black-Scholes option pricing model and will be expensed over the requisite vesting period. Note 12 - Related Party Transactions - continued (g) On November 12, 2015, and effective as of October 31, 2015, the Company's chairman of the board and principal stockholder, Richard J. Kurtz, committed to provide the Company with funding to pay off the Enhanced Notes, of which $2 million is required to be paid on or before April 30, 2016, under the commitment letter (the "Commitment"). As consideration for the Commitment, the Company granted Mr. Kurtz a fully vested and exercisable stock option to purchase 500,000 shares of the Company’s common stock, with an exercise price per share equal to the fair market value of a share of the Company’s common stock on November 12, 2015, determined based on the per share closing price on such date, or $0.294 per share, for a term of eight (8) years. The transaction was valued at approximately $47,000 , which was estimated using the Black-Scholes option pricing model and fully expensed on the date of grant. The Commitment will be superseded and become null and void in the event and to the extent that, at or before the time the Commitment is due, the Enhanced obligations are repaid in full in immediately available cash on or prior to August 31, 2016. On August 25, 2016, Enhanced agreed to extend the August 31, 2016 pay off date for the Enhanced Notes to on or prior to September 16, 2016. On September 7, 2016, the Company repaid the Enhanced Notes in full and the chairman of the board's Commitment was terminated. See also (h) below for more information. (h) On December 21, 2015, the Company, with the consent of the Bank and Enhanced, repaid an aggregate of $500,000 in principal to the chairman for the Notes Payable - Related Party. Refer to Note 11 - Long-Term Debt, Item (c)(i) and (ii) for more information. As a result of the $500,000 principal payment to the chairman by the Company, the chairman was required by Enhanced to pay down the Enhanced Note by $150,000 . The Company initially offset the $150,000 that the chairman paid on its behalf direct to Enhanced against certain arms length sales transactions made to entities controlled by him for the Company's products; subsequently those amounts were paid by those entities and as a result, the Company repaid Mr. Kurtz the $150,000 paid to Enhanced on December 21, 2016. (i) On December 31, 2015, the Company vested 25,000 shares of common stock, par value $.01 , pursuant to an agreement with the chief operating officer, Harvey L. Schnitzer, for a stock bonus, which transaction was valued and recorded at $16,000 . Under the stock bonus agreement, the Company granted Mr. Schnitzer 100,000 shares of the Company’s common stock, par value $.01 , which vests in four equal 25,000 share increments, on February 7, 2014, December 31, 2014, December 31, 2015, and February 6, 2016, respectively, subject to continued employment with the Company. (j) During the year ended December 31, 2015, the Company issued an aggregate of 1,035,743 shares of restricted common stock pursuant to the anti-dilution provisions in an agreement with the Vice Chairman, Jay C. Nadel, for advisory and consulting services, which transactions were valued and recorded in the aggregate at $418,000 . (k) During the year ended December 31, 2015, the Company vested an aggregate of 1,224,763 shares of restricted common stock issued as Guaranty Shares, to the chairman of the board and majority stockholder in connection with his personal guaranty required with the Enhanced Note, which transactions were valued and recorded in the aggregate at $735,000 , and classified as interest expense – related party. (l) On February 7, 2016, the Company vested the last tranche of 25,000 shares of common stock, par value $.01 , pursuant to an agreement with the chief operating officer, Harvey L. Schnitzer, for a stock bonus, which transaction was valued and recorded at $16,000 . Under the stock bonus agreement, the Company granted Mr. Schnitzer 100,000 shares of the Company’s common stock, par value $.01 , which vest in four equal 25,000 share increments, on February 7, 2014, December 31, 2014, December 31, 2015, and February 6, 2016, respectively, subject to continued employment with the Company. (m) On March 14, 2016, the Company granted an eight -year option to Richard J. Kurtz, chairman of the board and principal stockholder, for the right to acquire 800,000 shares of the Company's common stock, par value $.01 , at an exercise price per share equal to the fair market value of a share of the Company’s common stock on the date of grant, determined based on the per share closing price on such date, or $0.40 per share, which options vest monthly on a pro rata basis over 3 years, subject to continued satisfactory board services. The transaction was valued at $306,000 , which was estimated using the Black-Scholes option pricing model and will be expensed over the requisite vesting period. (n) On March 14, 2016, the Company granted an eight -year option to Douglas J. Kramer, chief executive officer and president, for the right to acquire 2 million shares of the Company's common stock, par value $.01 , at an exercise price per share equal to the fair market value of a share of the Company’s common stock on the date of grant, determined based on the per share closing price on such date, or $0.40 per share, which options vest monthly on a pro rata basis over 3 years , subject to continued satisfactory employment. The transaction was valued at $766,000 , which was estimated using the Black-Scholes option pricing model and will be expensed over the requisite vesting period. (o) On December 31, 2016, the Company granted and vested 100,000 shares of common stock, par value $.01 , pursuant to an agreement with Richard J. Kurtz, for a stock bonus, for serving as chairman of the board, which transaction was valued and recorded at $53,000 . The 100,000 shares of common stock were valued at $0.53 per share, the closing price of the Company’s common stock as quoted on OTC Markets on the date of grant. Note 12 - Related Party Transactions - continued (p) On December 30, 2016, the Company entered into a second amendment to that certain Executive Employment Agreement, effective January 1, 2014, as amended, with Douglas J. Kramer, CEO and President, which extends his Employment Term for an additional one (1) year from December 31, 2016 to December 31, 2017. (q) On December 30, 2016, the Company entered into a first amendment to that certain Executive Employment Agreement, effective January 1, 2015, with Jomarc C. Marukot, CFO and Treasurer, which: (a) extends his Employment Term for an additional one (1) year from December 31, 2016 to December 31, 2017; and (b) provides for an annual base salary increase, effective January 1, 2017, from $190,000 to $210,000 . See also Item (a) above. (r) During the year ended December 31, 2016, the Company issued an aggregate of 1,035,743 shares of restricted common stock pursuant to the anti-dilution provisions in an agreement with the Vice Chairman, Jay C. Nadel, for advisory and consulting services, which transactions were valued and recorded in the aggregate at $418,000 . (s) During the year ended December 31, 2016, the Company vested the remaining an aggregate of 1,157,653 shares of restricted common stock issued as Guaranty Shares, to the chairman of the board and majority stockholder in connection with his personal guaranty required with the Enhanced Note, which transactions were valued and recorded in the aggregate at $696,000 , and classified as interest expense – related party. See also Note 11 (c) below for more information. See also Note 19 - Subsequent Events for more information. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of income tax expense are as follows (in thousands): Years Ended December 31, 2016 2015 Current: Federal $ 162 $ — State 100 27 Total Current 262 27 Deferred: Federal 49 365 State — — Total Deferred 49 365 Total Tax Provision $ 311 $ 392 The following is a reconciliation of expected tax expense to actual expense (in thousands): Years Ended December 31, 2016 2015 Federal Income Tax Expense/(Benefit) $ 2,274 $ (62 ) State Income Tax 198 494 Nondeductible Expenses 168 40 Provision to Return Reconciling Items 3,112 (3,211 ) Change in Valuation Allowance (5,442 ) 3,229 Other 1 (98 ) Total Tax Provision $ 311 $ 392 Note 13 - Income Taxes - continued Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities, for financial reporting purposes, and amounts used for Federal income tax purposes. The components of deferred tax assets and liabilities are as follows (in thousands): December 31, 2016 2015 Deferred Tax Assets: Federal and State Net Operating Loss Carry-Forward $ 20,361 $ 25,986 Share-Based Compensation 1,084 1,151 Other Temporary Differences 1,167 1,051 Total $ 22,612 $ 28,188 Deferred Tax Liabilities Tax Goodwill $ (414 ) $ (365 ) Depreciation (276 ) (280 ) Other Temporary Differences — (130 ) Total $ (690 ) $ (775 ) Net Deferred Tax Asset $ 21,922 $ 27,413 Valuation Allowance (22,336 ) (27,778 ) Deferred Tax Liability $ (414 ) $ (365 ) At December 31, 2016, the Company had available, net operating loss carry-forwards of approximately $59.5 million for Federal income tax purposes and net operating loss carry-forwards of approximately $2.7 million for State income tax purposes, which will begin to expire in 2019. Utilization by the Company is subject to limitations based on the Company's future income, and pursuant to Section 382 of the Internal Revenue Code. The usage of some of these net operating loss carry-forwards may be limited due to changes in ownership that have occurred or may occur in the future. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases The Company conducts operations in leased facilities located in Texas and New Jersey. The Texas lease includes lease concessions which amounts are included as part of the aggregate minimum lease payments and recognized on a straight-line basis over the minimum lease terms. Future minimum lease payments required under the non-cancelable operating lease as and for the years ending December 31 are as follows (in thousands): 2017 2018 2019 $ 483 $ 487 $ 490 Rent expense for the years ended December 31, 2016 and 2015 was $328,000 and $343,000 , respectively. Legal Proceedings (a) Neil and Kristine Markey, et al., Plaintiffs v. Lapolla Industries, Inc., Delfino Insulation, et al, Defendants. A complaint initially entitled Neil and Kristine Markey, individually, and on behalf of all others similarly situated, Plaintiffs, vs. Lapolla industries, Inc. , a Delaware corporation; Lapolla International, Inc., a Delaware corporation; and Delfino Insulation Company, Inc., a New York Corporation, Defendants, was filed in the United States District Court for the Eastern District of New York and served on or about October 10, 2012 and amended last on November 11, 2013. Plaintiffs brought this lawsuit only individually, having amended out any request for a class action. The complaint alleged, among other things, that Lapolla designed, labeled, distributed, and manufactured spray polyurethane foam insulation, which created a highly toxic compound when applied as insulation resulting in exposure to harmful gases. Plaintiffs sought: actual, compensatory, and punitive damages; injunctive relief; and attorney fees. Lapolla considered the allegations to be without merit and vigorously defended the allegations. On February 4, 2015, the Court dismissed the litigation with prejudice, per the voluntary request of Plaintiffs upon the advice of their new counsel and after their original litigation counsel withdrew citing irreconcilable differences with the Plaintiffs. The Court retained jurisdiction to address a pending motion for sanctions filed by Lapolla. The primary basis for Lapolla’s motion for sanctions is the Plaintiffs’ and their original attorney’s filing of the lawsuit without sufficient factual basis for the claims of personal injury and for failing to comply with discovery obligations to produce numerous potentially dispositive documents that Plaintiffs knew existed and their original counsel either knew or should have known existed. Lapolla seeks to recover over $800,000 in legal fees for the defense of the lawsuit. All motions have been filed with the Court and Lapolla is awaiting a final ruling. The final outcome of this litigation cannot be determined at this time. Note 14 - Commitments and Contingencies - continued (b) Michael Commaroto, Kimberly S. Commaroto, and Gretchen Schlegel, Plaintiffs v. Pasquale Guzzo a/k/a Pasqualino Guzzo PDB Home Improvements, Perfect Wall, LLC, and Jozsef Finta, Defendants. Pasquale Guzzo a/k/a Pasqualino Guzzo PDB Home Improvements filed a third-party complaint against Lapolla Industries, Inc. in the Superior Court, Judicial District of Stamford/Norwalk, in Connecticut on January 3, 2013. Guzzo is alleging Lapolla’s spray polyurethane foam product is a defective product under Connecticut law and seeking indemnification and attorney’s fees. On August 28, 2013, Michael Commaroto, Kimberly S. Commaroto, and Gretchen Schlegel filed an amended complaint against Lapolla also asserting the spray polyurethane foam is a defective product. Plaintiffs seek monetary damages, punitive damages, and attorney’s fees, among other relief. Lapolla considers the allegations to be without merit and is vigorously defending the allegations. The outcome of this litigation cannot be determined at this time. (c) Various Lawsuits and Claims Arising in the Ordinary Course of Business We are involved in various lawsuits and claims arising in the ordinary course of business, which are, in our opinion, immaterial both individually and in the aggregate with respect to our consolidated financial position, liquidity or results of operations. |
Net Income (Loss) Per Common Sh
Net Income (Loss) Per Common Share - Basic and Diluted | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Common Share - Basic and Diluted | (Loss) Per Share Basic net income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock and common stock equivalents outstanding during the period. Common stock equivalents were not considered in calculating diluted net loss per common share for the years ended December 31, 2015 as their effect would be anti-dilutive. The computation of the Company’s basic and diluted earnings per share is as follows (in thousands, except per share data): Year Ended December 31, 2016 2015 Net income or (loss) available to common shareholders (A) $ 6,378 $ (577 ) Weighted average common shares outstanding (B) 122,813 121,283 Dilutive effect of employee equity incentive plans 484 — Weighted average common shares outstanding, assuming dilution (C) 123,297 121,283 Basic earnings per common share (A)/(B) $ 0.05 $ (0.00 ) Diluted earnings per common share (A)/(C) $ 0.05 $ (0.00 ) For 2016 , a total of 400,000 shares of common stock were excluded from the calculation of diluted earnings per common share, all of which shares were for outstanding, vested and exercisable stock options that had an exercise price greater than the market value of the common share as of the period then ended (out-of-the-money"). For 2015 , a total of 2,667,500 shares of common stock were excluded from the calculation of diluted earnings per common share due to the net loss incurred by the company and all of which shares were for outstanding, vested and exercisable stock options that had an exercise price equal to or lesser than the market value of the common share as of the period then ended (“in-the-money”). Outstanding, vested and exercisable out-of-the money stock options could be included in the calculation in the future if the market value of the Company’s common shares increases and is greater than the exercise price, and outstanding, vested and exercisable in-the-money stock options could be included in the calculation in the future for periods then ended when the Company reports a profit. |
Securities Transactions
Securities Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Securities Financing Transactions [Abstract] | |
Securities Transactions | Securities Transactions (a) During 2016 , the Company issued an aggregate of 86,404 shares of restricted common stock, par value $.01 , valued and recorded in the aggregate at $38,000 for advisory and consulting services. (b) During 2016 , the Company issued an aggregate of 1,157,653 shares of restricted common stock, par value $.01 , valued and recorded in the aggregate at $696,000 and classified as interest expense – related party pursuant to a guaranty made in connection with a financing. See also Note 11 (c) below for more information. (c) During 2016 , the Company issued 25,000 shares of common stock, par value $.01 per share, for a stock bonus to an executive officer, employee, which transaction was valued and recorded at $16,000 . |
Share-Based Payment Arrangement
Share-Based Payment Arrangements | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Payment Arrangements | Share–Based Payment Arrangements The Company reports share-based compensation arrangements using a straight-line fair valuation model for stock awards and Black-Scholes fair valuation model for option awards to calculate compensation expense over the requisite service period of grants. At December 31, 2016 , the Company had three share based compensation plans, including the Equity Incentive Plan (“Equity Plan”), Advisory and Consulting Agreement Plan (“Advisor Plan”), and Guaranty Agreement Plan (“Guaranty Plan”) in effect. Compensation cost charged against income for all compensation and incentive plans for 2016 and 2015 was $1.7 million and $2.0 million, respectively. Equity Incentive Plan The Company’s Equity Plan, which is shareholder-approved, permits the grant of stock awards to eligible participants for up to 10,000,000 shares of common stock. The purpose of the Equity Plan is to advance the interests of the Company and its stockholders by providing an incentive to attract, retain and reward employees, directors and consultants performing services for the Company and by motivating such persons to contribute to the growth and profitability of the Company. The Equity Plan provides financial performance measures upon which specific performance goals would be based and limits on the numbers of shares or compensation that could be made. Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Stock awards may provide for accelerated vesting if there is a change in control. The fair value of each stock option is estimated on the date of grant using the Black-Scholes valuation model and spread over the requisite service period. For 2016 , there was an aggregate of 2,925,000 awards granted and/or vested to directors, officers, and key employees, of which 2,800,000 were for options granted and 125,000 were for stock awards vested. For 2015 , there was an aggregate of 5,417,500 awards granted to directors, officers, and key employees, of which 5,317,500 were for options and 100,000 were for stock awards. As of December 31, 2016 , total compensation cost related to non-vested stock options was $896,000 , which is expected to be recognized over 2.12 years after December 31, 2016 ( 25.5 months on a weighted-average basis). As of December 31, 2015 , total compensation cost related to non-vested stock options was $ 1.4 million. There were 1,982,500 shares issuable and available for grant at December 31, 2016 . Stock option and bonus activity under the Company’s Equity Plan as of the years ended December 31, is summarized below: Option Awards 2016 2015 Number Weighted-Average Number Weighted-Average Options of Options Exercise Price of Options Exercise Price Outstanding-Beginning of Year 5,017,500 $ 0.48 7,277,500 $ 0.47 Granted 2,800,000 0.40 2,100,000 0.33 Exercised — — — — Canceled, Expired or Forfeited — — (4,360,000 ) 0.46 Outstanding - End of Year 7,817,500 0.42 5,017,500 0.48 Exercisable - End of Year 5,032,420 $ 0.41 2,667,500 $ 0.73 The weighted-average grant-date fair value of option awards granted during 2016 and 2015 was $634,866 and $ 79,387 , respectively. The following table summarizes options outstanding at: Outstanding Exercisable Outstanding Exercisable Weighted Average Weighted Weighted Weighted Average Weighted Weighted Range of Number Remaining Average Number Average Number Remaining Average Number Average Exercise Outstanding Contractual Exercise Exercisable Exercise Outstanding Contractual Exercise Exercisable Exercise Prices at 12/31/16 Life (Years) Price at 12/31/16 Price at 12/31/15 Life (Years) Price at 12/31/15 Price $.20 - $.39 2,380,000 5.5 $ 0.33 2,205,000 $ 0.33 3,230,000 6.5 $ 0.29 1,580,000 $ 0.24 $.40 - $.59 4,837,500 3.9 0.42 2,427,420 0.43 3,587,500 4.2 $ 0.44 887,500 $ 0.45 $.60 - $.80 600,000 2.1 $ 0.71 400,000 0.71 600,000 3.1 $ 0.71 200,000 $ 0.71 Note 17 - Share–Based Payment Arrangements, continued Stock Awards 2016 2015 Number Weighted-Average Number Weighted-Average Nonvested Awards of Shares Grant-Date Fair Value of Shares Grant-Date Fair Value Nonvested - Beginning of Year 25,000 $ 16,250 50,000 $ 32,500 Granted 100,000 53,000 — — Vested (125,000 ) (69,250 ) (25,000 ) (16,250 ) Canceled, Expired or Forfeited — — — — Nonvested - End of Year — $ — 25,000 $ 16,250 Advisor Plan The Company entered into an advisory and consultant agreement on February 22, 2011 with a non-employee director, Jay C. Nadel, wherein the Company granted 5,000,000 shares of restricted common stock, par value $.01 , which vested monthly over 3 years , and includes certain anti-dilution provisions (the "Nadel Agreement"). The grant-date fair value for the 5,000,000 shares was calculated by taking the closing price of the Company's common stock of $.57 per share on the date of grant and multiplying it by the number of shares granted, equaling $2,850,000 , all of which has been recorded. The anti-dilution aspects continue so long as the Nadel Agreement is in force. For 2016 , anti-dilution transactions occurred, which required the Company to grant and vest an additional 86,404 shares of restricted common stock. The grant-date fair value for the anti-dilution shares was calculated by taking the closing price of the Company’s common stock on the anti-dilution dates for a weighted-average of approximately $0.44 per share and multiplying it by the number of shares granted, equaling $38,000 . For 2015, anti-dilution transactions occurred, which required the Company to grant and vest an additional 1,035,743 shares of restricted common stock. The grant-date fair value for the anti-dilution shares was calculated by taking the closing price of the Company’s common stock on the anti-dilution dates for a weighted-average of approximately $0.40 per share and multiplying it by the number of shares granted, equaling $418,000 . A summary of awards activity under the Advisor Plan at December 31, 2016 and 2015 , and changes during the years then ended, are as follows: 2016 2015 Number Weighted-Average Number Weighted-Average Nonvested Awards of Shares Grant-Date Fair Value of Shares Grant-Date Fair Value Nonvested - Beginning of Year — $ — — $ — Granted 86,404 38,063 1,035,743 417,662 Vested (86,404 ) (38,063 ) (1,035,743 ) (417,662 ) Canceled, Expired or Forfeited — — — — Nonvested - End of Year — $ — — $ — Guaranty Plan The Company made a grant of restricted common stock in connection with a personal guarantee provided by the chairman of the board and majority stockholder to secure working capital on favorable terms and the Company’s performance under a financing instrument. Refer to Note 12 – Financing Instruments, Items (b)(i) – Enhanced Note for more information on the financial instrument. The Company granted 3,681,000 shares of restricted common stock, par value $0.01 , which shares vest monthly on a pro rata basis over the life of the Enhanced Note (“Guaranty Shares”). The Guaranty Shares were valued at $.60 per share, the closing price of the Company’s common stock as quoted on the OTC Markets on the day preceding the closing date of December 10, 2013, for an aggregate amount of $2.2 million . The Guaranty Shares are being recorded as interest expense – related party, thereby increasing the effective interest rate on the Enhanced Note. The following table summarizes grant activity under the Guaranty Plan at December 31, 2016 and 2015 , and changes during the years then ended: 2016 2015 Number Weighted-Average Number Weighted-Average Nonvested Awards of Shares Grant-Date Fair Value of Shares Grant-Date Fair Value Nonvested - Beginning of Year 1,157,653 $ 694,591 2,382,416 $ 1,429,449 Granted — — — — Vested (1,157,653 ) (694,591 ) (1,224,763 ) (734,858 ) Canceled, Expired or Forfeited — — — — Nonvested - End of Year — $ — 1,157,653 $ 694,591 |
Business Segments and Geographi
Business Segments and Geographic Area Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Business Segments and Geographic Area Information | Business Segments and Geographic Area Information Business Segments The Company is a leading United States based manufacturer and global supplier operating two segments: Foam and Coatings. The Company’s segments are organized based on manufacturing competencies. Foam . The Foam segment primarily supplies both roofing and building envelope insulation applications. Roofing applications consist of foam and coatings systems in new and retrofit commercial and industrial applications. Insulation is used in commercial and industrial, as well as residential, applications. We manufacture our own roofing and wall insulation foams. Additionally, this segment also supplies polyurethane as an adhesive for board stock insulation to roofing substrates for commercial and industrial applications, sundry items, and application equipment. Spray Rigs are an integral part of our business insofar that they are required for the application of our foam and used for large scale coating jobs. We began making and selling our own spray rigs during 2008. This is a basic assembly operation and we undertake this task to provide turnkey service to our customers. We allocate sales amounts for Spray Rigs to either our foam or coatings segments, as applicable. The AirTight Division involves application of interior insulation foams that we produce and installation of other energy reducing products in multi-family properties by subcontractors hired by the Company on a limited basis. We allocate sales amounts for The AirTight Division to our foam segment. Coatings . The Coatings segment primarily supplies a variety of protective coatings for roofing systems for new and retrofit commercial and industrial applications, as well as residential, applications. Additionally, this segment also supplies caulking for general application in the construction industry, and sundry items. We manufacture our own roof coatings. The Company maintains centralized manufacturing and spray rig building operations in Houston, Texas. The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 1. The Company allocates resources to segments and evaluates the performance of segments based upon reported segment income before income taxes. A substantial amount of administrative expenses are allocated to the segments. The portion not allocated to the segments represents the unallocated cost of certain corporate expenses and are included in Unallocated Amounts . There are no intersegment sales or transfers. The following are selected results of reportable segments (in thousands): Segments 2016 Foam Coatings Totals Sales $ 73,919 $ 12,467 $ 86,386 Depreciation 75 13 88 Amortization of Other Intangible Assets 213 36 249 Interest Expense 640 108 748 Segment Profit 10,213 1,984 12,197 Segment Assets (1) 22,538 4,566 27,104 Expenditures for Segment Assets $ 123 $ 21 $ 144 2015 Foam Coatings Totals Sales $ 66,030 $ 12,619 $ 78,649 Depreciation 110 21 131 Amortization of Other Intangible Assets 215 41 256 Interest Expense 955 183 1,138 Segment Profit 4,514 1,815 6,329 Segment Assets (1) 19,341 4,372 23,713 Expenditures for Segment Assets $ 48 $ 9 $ 57 Note 18 - Business Segments and Geographic Area Information - continued The following are reconciliations of reportable segment profit or loss, and assets, to the Company’s totals for the years indicated: Segments Profit 2016 2015 Total Profit for Reportable Segments $ 12,197 $ 6,329 Unallocated Amounts: Corporate Expenses (5,508 ) (6,514 ) Income (Loss) Before Income Taxes $ 6,689 $ (185 ) Assets 2016 2015 Total Assets for Reportable Segments (1) $ 27,104 $ 23,713 Other Unallocated Amounts (2) 2,291 2,296 Total $ 29,395 $ 26,009 (1) Segment assets are the total assets used in the operation of each segment. (2) Includes corporate assets which are principally cash and prepaid expenses. Geographic Area Information The Company does not operate any manufacturing sites nor maintain a permanent establishment in any particular country outside of the United States at this time. The Company’s products are sold to independent distributors globally for select target markets. Sales are attributed to geographic areas based on customer location. Long-lived assets are attributable to geographic areas based on asset location. Geographic Area (in thousands): United Rest of 2016 States Europe Middle East World Total Sales $ 81,393 $ 2,567 $ 3 $ 2,423 $ 86,386 Long-Lived Assets $ 6,431 $ — $ — $ — $ 6,431 United Rest of 2015 States Europe Middle East World Total Sales $ 76,589 $ 687 $ — $ 1,373 $ 78,649 Long-Lived Assets $ 6,838 $ — $ — $ — $ 6,838 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events (a) On January 1, 2017, the Company granted 100,000 shares of common stock, par value $.01 , pursuant to an agreement with Richard J. Kurtz, for a stock bonus. Under the stock bonus agreement, the Company granted Mr. Kurtz 100,000 shares of the Company’s common stock, par value $.01 , which vests in four equal 25,000 share increments, on March 31, 2017, June 30, 2017, September 30, 2017, and December 31, 2017, subject to continued service as chairman of the board of the Company. The 100,000 shares of common stock were valued in the aggregate at $0.53 per share, the closing price of the Company’s common stock as quoted on OTC Markets on the date of grant. (b) On January 5, 2017, the Company granted an aggregate of 400,000 eight -year options to non-employee directors, including Messrs Kurtz, Nadel, Gregg, and Larson, for the right to each acquire 100,000 shares of the Company's common stock, par value $.01 , at an exercise price per share equal to the fair market value of a share of the Company’s common stock on the date of grant, determined based on the per share closing price of the Company's common stock as quoted on the OTC Markets on such date, or $0.50 per share, which options vest over a 3 year period in the amount of 33,333 ; 33,333 ; and 33,334 on December 31, 2017, December 31, 2018, and December 31, 2019, subject to continued satisfactory board of director services. The transactions were valued in the aggregate at $191,000 , which was estimated using the Black-Scholes option pricing model and will be expensed over the requisite vesting periods. (c) On February 15, 2017, the Company announced a cash dividend of one cent per share, payable to shareholders of record as of March 30, 2017. (d) The Company has evaluated subsequent events through the date of this report. |
Summary of Organization, Basi26
Summary of Organization, Basis of Presentation and Critical Accounting Policies, Estimates and Assumptions (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Trade Receivables and Credit Risk | Trade Receivables and Credit Risk Trade receivables are the primary financial instruments that may subject the Company to significant concentrations of credit risk. The Company’s trade receivables consist primarily of uncollateralized obligations from its diverse customer base, including personal guarantees when obtainable, due under normal trade terms, which generally require payment within 30 days of the invoice date. However, these payment terms may be extended in select cases and many customers do not pay within stated trade terms. The Company has a credit insurance policy in place covering most customer account balances. The Company evaluates the creditworthiness of its customers’ financial position and monitors accounts on a regular basis. Provisions to the allowance for doubtful accounts are reviewed quarterly and adjustments are made periodically (as circumstances warrant) based upon management’s best estimate of collectability of accounts. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill represents the excess of the cost over the fair value of net tangible and identifiable intangible assets of acquired businesses. Identifiable intangible assets acquired in business combinations are recorded based upon their fair value at the date of acquisition. According to GAAP, goodwill is required to be tested for impairment, on an annual basis and between annual tests in certain circumstances, and written down when impaired. The goodwill impairment test is performed by comparing the fair value of the associated reporting unit to its carrying value. GAAP also requires that intangible assets with estimable useful lives be amortized over their respective estimated lives to their estimated residual values, and reviewed for impairment, unless these lives are determined to be indefinite. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company adopted authoritative GAAP guidance regarding disclosures about fair value of financial instruments, which requires the disclosure of the fair value of off-and-on balance sheet financial instruments. Unless otherwise indicated, the fair values of all reported assets and liabilities, which represent financial instruments (none of which are held for trading purposes), approximate the carrying values of such amounts. The Company adopted authoritative GAAP guidance regarding fair value measurements, which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants at the measurement date. This guidance establishes three levels of inputs that may be used to measure fair value: (a) Level 1 - Quoted prices in active markets for identical assets or liabilities. (b) Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities; and (c) Level 3 - Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of assets or liabilities. The Company had no Level 1, 2, or 3 assets or liabilities at December 31, 2016 and 2015 , respectively. The carrying value of cash and cash equivalents, trade receivables and payables, prepaid expenses and other current assets, and other payables and accruals approximate fair value due to short period of time to maturity. |
Litigation | Litigation The Company is occasionally involved in legal proceedings in the normal course of business. The Company accrues a liability for such matters when it is probable that a liability has been incurred and the amount can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. The accrual for a litigation loss contingency might include, for example, estimates of potential damages, outside legal fees and other directly related costs expected to be incurred. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers cash, checks, credit card and ACH payments deposited with financial institutions, with original maturities of three months or less, to be cash and cash equivalents. |
Fixed-Price Contracts | Fixed-Price Contracts The Company’s AirTight Division performs work under fixed-price contracts. The fixed-price contracts vary in length but are typically less than one year. In accordance with industry practice, the Company includes asset and liability accounts relating to fixed-price contracts, including related deferred income taxes, if applicable, in current assets and liabilities even when such amounts are realizable or payable over a period in excess of one year. Revenues from fixed-price contracts are recognized on the percentage-of-completion method, measured by the percentage of costs incurred to date to estimated total costs for each contract. Fixed-price contract costs include all direct material, labor costs, equipment and those indirect costs related to contract performance, such as indirect labor, supplies, tools, and repairs costs. General and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements may result in revisions to costs and income and are recognized in the period in which the revisions are determined. The asset "costs and estimated earnings in excess of billings on uncompleted contracts" represents revenues recognized in excess of amounts billed. The liability "billings in excess of costs and estimated earnings on uncompleted contracts" represents billings in excess of revenues recognized. |
Inventories | Inventories Cost is determined on an actual and/or standard cost basis that approximates the first-in, first-out (FIFO) method using a perpetual inventory system. Inventories are valued at the lower of cost or market (replacement cost), which does not exceed net realizable value. |
Income Taxes | Income Taxes The Company's provision for income taxes is determined using the U.S. federal statutory rate. The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of our assets and liabilities along with net operating losses and tax credit carryovers. The Company's net deferred tax asset was approximately $21.9 million and $27.4 million at December 31, 2016 and 2015 , respectively. The Company's federal income tax returns are open to audit under the statute of limitations for the years ended December 31, 2013 through 2015. The Company recorded a valuation allowance against the deferred tax asset of $22.3 million and $27.8 million at December 31, 2016 and 2015 , creating a deferred tax liability of $414,000 and $365,000 , respectively. The Company has no unrecognized income tax benefits. Accordingly, the annual effective tax rate is unaffected. Should the Company incur interest and penalties relating to tax uncertainties, such amounts would be classified as a component of interest expense and operating expense, respectively. |
Depreciable Lives of Property, Plant and Equipment | Depreciable Lives of Property, Plant and Equipment Property, plant and equipment is recorded at cost and depreciated using the straight-line method, which deducts equal amounts of the cost of each asset from earnings every year over its estimated economic useful life. Economic useful life is the duration of time an asset is expected to be productively employed by the Company, which may be less than its physical life. Assumptions on the following factors, among others, affect the determination of estimated economic useful life: wear and tear, obsolescence, technical standards, contract life, market demand, competitive position, raw material availability, and geographic location. The estimated economic useful life of an asset is monitored to determine its appropriateness, especially in light of changed business circumstances. For example, changes in technology and changes in the estimated future demand for products may result in a shorter estimated useful life than originally anticipated. In these cases, we would depreciate the remaining net book value over the new estimated remaining life, thereby increasing depreciation expense per year on a prospective basis. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant, and equipment held for use is grouped for impairment testing at the lowest level for which there is an identifiable cash flow. Impairment testing of the asset group occurs whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Such circumstances would include a significant decrease in the market value of a long-lived asset grouping, a significant adverse change in the manner in which the asset grouping is being used or in its physical condition, a history of operating or cash flow losses associated with the use of the asset grouping, or changes in the expected useful life of the long-lived assets. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by that asset group is compared to the carrying value to determine whether impairment exists. If an asset group is determined to be impaired, the loss is measured based on the difference between the asset group’s fair value and its carrying value. An estimate of the asset group’s fair value is based on the discounted value of its estimated cash flows. Assets to be disposed of by sale are reported at the lower of carrying amount or fair value less cost to sell. The assumptions underlying cash flow projections represent our best estimates at the time of the impairment review. Factors that we must estimate include industry and market conditions, sales volume and prices, costs to produce, etc. Changes in key assumptions or actual conditions that differ from estimates could result in an impairment charge. Management believes it uses reasonable and supportable assumptions when performing impairment reviews and cannot predict the occurrence of future events and circumstances that could result in impairment charges. |
Goodwill | Goodwill Goodwill represents the excess of the aggregate purchase price over the fair value of net tangible and identifiable intangible assets of an acquired business. Goodwill was $4.2 million at December 31, 2016 and 2015 . The Company operates two reporting units, Foam and Coatings. Disclosures related to goodwill are included in Note 8 to the financial statements. The Company evaluates goodwill for impairment on an annual basis, or more frequently if management believes indicators of impairment exist. Under generally accepted accounting principles, the Company has the option to perform a qualitative assessment to test for impairment of goodwill. If it is determined that it is more likely than not that the fair value of each reporting unit is greater than its carrying amount, there is no need to perform any further testing. However, if the Company concludes otherwise, then it is required to perform the first step of the two-step impairment test by calculating the fair value of each reporting unit and comparing the carrying value of each reporting unit to its estimated fair value. If the fair value of a reporting unit is greater than its carrying value then goodwill is not impaired; otherwise, the second step of the impairment test shall be performed to measure the amount of impairment loss. Based on the qualitative assessment performed as of December 31, 2016, the Company concluded that it was more likely than not that the fair value of its reporting units was greater than their carrying amount. Accordingly, no further testing was required. There were no goodwill impairment charges recorded during the years ended December 31, 2016 or 2015. |
Other Intangible Assets | Other Intangible Assets The Company had other intangible assets, net of $1.2 million at December 31, 2016 and 2015 , consisting of product formulations and trade names that were acquired as part of business combinations, and trademarks and approvals and certifications obtained as part of entering into new markets. Amortization of other intangible assets totaled $277,000 and $284,000 for the years ended December 31, 2016 and 2015 , respectively. Other intangible assets are tested for impairment as part of the long-lived asset grouping impairment tests. Impairment testing of the asset group occurs whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. See impairment discussion above under Property, Plant and Equipment for a description of how impairment losses are determined. Disclosures related to other intangible assets are included in Note 8 to the financial statements. Significant management judgment is required in the forecasts of future operating results that are used in the Company’s impairment evaluations. The estimates used are consistent with the plans and estimates that Management uses to manage its business. It is possible, however, that the plans may change and estimates used may prove to be inaccurate. If the Company’s actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, then the Company could incur future impairment charges, which would adversely affect financial performance. |
Revenue Recognition | Revenue Recognition Sales are recognized (i) as risk and title to products transfers to the customer (which generally occurs at the time shipment is made), (ii) the sales price is fixed or determinable, and (iii) collectability is reasonably assured. Sales channels include direct sales, distributors, and independent representatives. Irrespective of the sales channel, returns and allowances are not a business practice in the industry. Amounts billed for shipping and handling are included in revenues (freight). Freight included in revenue was $834,000 and $958,000 in 2016 and 2015 , respectively. Costs incurred for shipping and handling are included in cost of sales. Freight included in cost of sales was $4.3 million and $4.2 million in 2016 and 2015 , respectively. Revenues are recorded net of sales tax. |
Research and Development | Research and Development Research and development costs related to both future and present products are charged to operations as incurred. |
Share-Based Compensation | Share-Based Compensation The Company accounts for the cost of employee or director services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The fair value of share based awards is estimated at the grant date using a Black-Scholes valuation model and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period. The determination of fair value is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables, including expected stock price volatility, risk-free interest rate, expected dividends and projected employee stock option exercise behaviors. Employee stock option exercise behavior is based on actual historical exercise activity and assumptions regarding future exercise activity of unexercised, outstanding options. The Company applies an estimated forfeiture rate to unvested awards for the purpose of calculating compensation cost. These estimates are subject to revision in future periods if actual forfeitures differ from the estimates and changes impact compensation cost in the period in which the change in estimate occurs. Disclosures related to share-based compensation are included in Note 17 to our financial statements. Share-based compensation expense was $988,000 and $1.2 million in 2016 and 2015 , respectively. If additional share based awards are granted, financial performance may be negatively affected, and if outstanding share based awards are forfeited or canceled, resulting in non-vesting of such stock awards, financial performance may be positively affected. In either instance, the Company’s financial performance may change depending on share based award activities in future periods. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company presents trade receivables, net of allowances for doubtful accounts, to ensure trade receivables are not overstated due to uncollectible accounts. Allowances, when required, are calculated based on a detailed review of certain individual customer accounts, including credit insurance and other security when applicable, and an estimation of the overall economic conditions affecting our customer base. The Company reviews a customer’s credit history before extending credit. The allowance for doubtful accounts was approximately $366,000 and $545,000 at December 31, 2016 and 2015 , respectively. If the financial condition of customers were to deteriorate based on worsening overall economic conditions, resulting in an impairment of their ability to make payments to the Company, then additional allowances may be required in future periods. |
Cost of Sales and Selling General and Administrative Costs | Cost of Sales and Selling, General and Administrative Costs The Cost of Sales line item includes all the material, overhead, packaging, and freight costs associated with products shipped, including resale finished goods and raw materials, as well as payroll costs associated with manufacturing the finished goods, inbound freight, sales tax expense, product containers, labels, and other miscellaneous items that are indirectly used in the manufacturing, packaging, and shipping (outbound freight) of finished goods, including inspection, and internal transfer costs, as well as depreciation of machinery, amortization of approvals and certifications, and an allocated portion of overhead. The Selling, General and Administrative line item includes selling, advertising, marketing, customer service, and technical support, as well as the costs of providing corporate functional support for all other areas of our business. |
Advertising and Marketing Expenses | Advertising and Marketing Expenses Advertising and marketing costs are generally expensed as they are incurred. Expenditures for certain advertising and marketing activities related to trade shows and trade magazines are deferred within the Company’s fiscal year when the benefits clearly extend beyond the interim period in which the expenditure is made, generally not to exceed 90 days. There were $181,000 and $ 116,000 costs for advertising deferred on the Company’s balance sheets as of December 31, 2016 and 2015 , respectively. Other advertising and marketing expenditures that do not meet the deferred criteria are expensed when the advertising and marketing occurs. |
Debt Issuance Costs | Debt Issuance Costs The Company capitalizes debt issuance costs, which are netted against long-term debt in the Company’s balance sheets. These costs are amortized over the term of the financial instrument. Amortization of debt issuance costs is included in “Interest Expense” in the statements of operations. |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share Basic income (loss) per share is based upon the net income (loss) applicable to common shares after preferred dividend requirements and upon the weighted average number of common shares outstanding during the period. Diluted income (loss) per share reflects the effect of the assumed exercise of stock options and warrants only in periods in which such effect would have been dilutive. |
Recently Adopted Accounting Standards and New Accounting Standards Not Yet Adopted | Recently Adopted Accounting Standards In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-15, “ Presentation of Financial Statements—Going Concern: Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” The amendments in this ASU are intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. This ASU provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations in the financial statement footnotes. The pronouncement is effective for annual reporting periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. The Company adopted the provisions of the guidance in the fourth quarter of 2016. The adoption did not have a material impact on the Company’s financial statements. In January 2015, the FASB issued ASU 2015-01, “ Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” This ASU eliminates from GAAP the concept of extraordinary items and the need for an entity to separately classify, present, and disclose extraordinary events and transactions, while retaining certain presentation and disclosure guidance for items that are unusual in nature or occur infrequently. The pronouncement is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period and may be applied retrospectively, with early application permitted. The Company adopted the provisions of the guidance in the fourth quarter of 2015. The adoption did not have a material impact on the Company’s financial statements. In April 2015, the FASB issued ASU 2015-03, “ Simplifying the Presentation of Debt Issuance Costs. " The accounting guidance requires that debt issuance costs related to a recognized debt liability be reported on the Statements of Financial Condition as a direct deduction from the carrying amount of that debt liability. The pronouncement is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early application permitted for financial statements that have not been previously issued. The Company adopted the provisions of the guidance in the first quarter of 2016, and retrospectively for 2015. The adoption did not have a material impact on the Company’s financial statements. In November 2015, the FASB issued ASU 2015-17, " Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes ," which simplifies the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This ASU is effective for financial statements issued for annual periods beginning after December 16, 2016, and interim periods within those annual periods. The Company adopted the provisions of the guidance in the fourth quarter of 2016. The adoption did not have a material impact on the Company’s financial statements. There was not a need to retrospectively adjust prior periods. New Accounting Standards Not Yet Adopted |
Trade Receivables (Tables)
Trade Receivables (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Trade Receivables | Trade receivables are comprised of the following (in thousands): December 31, 2016 2015 Trade Receivables $ 12,874 $ 10,551 Less: Allowance for Doubtful Accounts (366 ) (545 ) Trade Receivables, Net $ 12,508 $ 10,006 |
Contracts (Tables)
Contracts (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Contractors [Abstract] | |
Costs and Estimated Earnings on Uncompleted Contract | (in thousands): December 31, 2016 2015 Costs Incurred on Uncompleted Contracts $ 274 $ 1,089 Estimated Earnings on Uncompleted Contracts 83 306 Earned Revenues 357 1,395 Less: Billings to Date (378 ) (1,404 ) Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts $ (21 ) $ (9 ) Included in the accompanying balance sheets under the following captions as of December 31 (in thousands): 2016 2015 Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts $ — $ 42 Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts 21 51 Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts $ (21 ) $ (9 ) |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | The following is a summary of inventories (in thousands): December 31, 2016 2015 Raw Materials $ 2,157 $ 2,599 Finished Goods 4,453 5,575 Inventories, Net $ 6,610 $ 8,174 |
Prepaid Expenses and Other Cu30
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Summary of Prepaid Expenses and Other Current Assets | The following is a summary of prepaid expenses and other current assets (in thousands): December 31, 2016 2015 Prepaid Insurances $ 735 $ 637 Prepaid Marketing 181 116 Prepaid Consulting 94 58 Prepaid Other 1,064 363 Total Prepaid Expenses and Other Current Assets $ 2,074 $ 1,174 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | The following is a summary of property, plant and equipment (in thousands): December 31, 2016 2015 Estimated Useful Life Vehicles $ 244 $ 462 5 Years Leasehold Improvements 269 289 13 – 15 Years Office Furniture and Equipment 159 307 3 – 7 Years Computers and Software 907 946 3 – 5 Years Machinery and Equipment 2,557 2,517 3 – 20 Years Total Property, Plant and Equipment $ 4,136 $ 4,521 Less: Accumulated Depreciation (3,151 ) (3,434 ) Total Property, Plant and Equipment, Net $ 985 $ 1,087 |
Goodwill and Other Intangible32
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | The following is a summary of Goodwill (in thousands): Goodwill December 31, 2016 2015 Foam $ 2,932 $ 2,932 Coatings 1,303 1,303 $ 4,235 $ 4,235 |
Other Intangible Assets | The following is a summary of Other Intangible Assets (in thousands): Other Intangible Assets December 31, 2016 2015 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Amortization Period Product Formulations $ 138 (104 ) $ 34 138 $ (95 ) 43 15 Years Trade Names 750 (419 ) 331 750 (369 ) 381 15 Years Approvals and Certifications 3,462 (2,647 ) 815 3,202 (2,429 ) 773 5 Years $ 4,350 $ (3,170 ) $ 1,180 $ 4,090 $ (2,893 ) $ 1,197 |
Schedule of Future Amortization Expense | Based on the other intangible assets in service as of December 31, 2016 , estimated amortization expense for the years ending December 31, 2017 through December 31, 2021 and thereafter is as follows (in thousands): 2017 2018 2019 2020 2021 Thereafter Product Formulations $ 9 $ 9 $ 9 $ 7 $ — $ — Trade Names 50 50 50 50 50 81 Approvals and Certifications 205 205 205 200 — — $ 264 $ 264 $ 264 $ 257 $ 50 $ 81 |
Deposits and Other Non-Curren33
Deposits and Other Non-Current Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Summary of Deposits and Other Non-Current Assets | The following is a summary of deposits and other non-current assets (in thousands): December 31, 2016 2015 Prepaid Expenses 8 25 Other Receivables 9 5 Deposits 64 64 Total Deposits and Other-Non-Current Assets $ 81 $ 94 |
Accrued Expenses and Other Cu34
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Expenses and Other Current Liabilities | The following is a summary of accrued expenses and other current liabilities as (in thousands): December 31, 2016 2015 Accrued Payroll $ 3 $ (6 ) Accrued Commissions 172 129 Accrued Inventory 249 438 Accrued Taxes and Other 1,990 1,725 Accrued Insurance 490 459 Deferred Finance Charge Income 13 28 Total Accrued Expenses and Other Current Liabilities $ 2,917 $ 2,773 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The components of income tax expense are as follows (in thousands): Years Ended December 31, 2016 2015 Current: Federal $ 162 $ — State 100 27 Total Current 262 27 Deferred: Federal 49 365 State — — Total Deferred 49 365 Total Tax Provision $ 311 $ 392 |
Schedule of Effective Income Tax Rate Reconciliation | he following is a reconciliation of expected tax expense to actual expense (in thousands): Years Ended December 31, 2016 2015 Federal Income Tax Expense/(Benefit) $ 2,274 $ (62 ) State Income Tax 198 494 Nondeductible Expenses 168 40 Provision to Return Reconciling Items 3,112 (3,211 ) Change in Valuation Allowance (5,442 ) 3,229 Other 1 (98 ) Total Tax Provision $ 311 $ 392 |
Schedule of Deferred Tax Assets and Liabilities | : December 31, 2016 2015 Deferred Tax Assets: Federal and State Net Operating Loss Carry-Forward $ 20,361 $ 25,986 Share-Based Compensation 1,084 1,151 Other Temporary Differences 1,167 1,051 Total $ 22,612 $ 28,188 Deferred Tax Liabilities Tax Goodwill $ (414 ) $ (365 ) Depreciation (276 ) (280 ) Other Temporary Differences — (130 ) Total $ (690 ) $ (775 ) Net Deferred Tax Asset $ 21,922 $ 27,413 Valuation Allowance (22,336 ) (27,778 ) Deferred Tax Liability $ (414 ) $ (365 ) |
Commitments and Contingencies (
Commitments and Contingencies (Table) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Capital Leased Assets | Future minimum lease payments required under the non-cancelable operating lease as and for the years ending December 31 are as follows (in thousands): 2017 2018 2019 $ 483 $ 487 $ 490 |
Net Income (Loss) Per Common 37
Net Income (Loss) Per Common Share - Basic and Diluted (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The computation of the Company’s basic and diluted earnings per share is as follows (in thousands, except per share data): Year Ended December 31, 2016 2015 Net income or (loss) available to common shareholders (A) $ 6,378 $ (577 ) Weighted average common shares outstanding (B) 122,813 121,283 Dilutive effect of employee equity incentive plans 484 — Weighted average common shares outstanding, assuming dilution (C) 123,297 121,283 Basic earnings per common share (A)/(B) $ 0.05 $ (0.00 ) Diluted earnings per common share (A)/(C) $ 0.05 $ (0.00 ) |
Share-Based Payment Arrangeme38
Share-Based Payment Arrangements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Stock Option Activity | Stock option and bonus activity under the Company’s Equity Plan as of the years ended December 31, is summarized below: Option Awards 2016 2015 Number Weighted-Average Number Weighted-Average Options of Options Exercise Price of Options Exercise Price Outstanding-Beginning of Year 5,017,500 $ 0.48 7,277,500 $ 0.47 Granted 2,800,000 0.40 2,100,000 0.33 Exercised — — — — Canceled, Expired or Forfeited — — (4,360,000 ) 0.46 Outstanding - End of Year 7,817,500 0.42 5,017,500 0.48 Exercisable - End of Year 5,032,420 $ 0.41 2,667,500 $ 0.73 |
Summary of Options Outstanding by Exercise Price | following table summarizes options outstanding at: Outstanding Exercisable Outstanding Exercisable Weighted Average Weighted Weighted Weighted Average Weighted Weighted Range of Number Remaining Average Number Average Number Remaining Average Number Average Exercise Outstanding Contractual Exercise Exercisable Exercise Outstanding Contractual Exercise Exercisable Exercise Prices at 12/31/16 Life (Years) Price at 12/31/16 Price at 12/31/15 Life (Years) Price at 12/31/15 Price $.20 - $.39 2,380,000 5.5 $ 0.33 2,205,000 $ 0.33 3,230,000 6.5 $ 0.29 1,580,000 $ 0.24 $.40 - $.59 4,837,500 3.9 0.42 2,427,420 0.43 3,587,500 4.2 $ 0.44 887,500 $ 0.45 $.60 - $.80 600,000 2.1 $ 0.71 400,000 0.71 600,000 3.1 $ 0.71 200,000 $ 0.71 |
Equity Incentive Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Share Activity | Stock Awards 2016 2015 Number Weighted-Average Number Weighted-Average Nonvested Awards of Shares Grant-Date Fair Value of Shares Grant-Date Fair Value Nonvested - Beginning of Year 25,000 $ 16,250 50,000 $ 32,500 Granted 100,000 53,000 — — Vested (125,000 ) (69,250 ) (25,000 ) (16,250 ) Canceled, Expired or Forfeited — — — — Nonvested - End of Year — $ — 25,000 $ 16,250 |
Advisor Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Share Activity | A summary of awards activity under the Advisor Plan at December 31, 2016 and 2015 , and changes during the years then ended, are as follows: 2016 2015 Number Weighted-Average Number Weighted-Average Nonvested Awards of Shares Grant-Date Fair Value of Shares Grant-Date Fair Value Nonvested - Beginning of Year — $ — — $ — Granted 86,404 38,063 1,035,743 417,662 Vested (86,404 ) (38,063 ) (1,035,743 ) (417,662 ) Canceled, Expired or Forfeited — — — — Nonvested - End of Year — $ — — $ — |
Guaranty Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Share Activity | The following table summarizes grant activity under the Guaranty Plan at December 31, 2016 and 2015 , and changes during the years then ended: 2016 2015 Number Weighted-Average Number Weighted-Average Nonvested Awards of Shares Grant-Date Fair Value of Shares Grant-Date Fair Value Nonvested - Beginning of Year 1,157,653 $ 694,591 2,382,416 $ 1,429,449 Granted — — — — Vested (1,157,653 ) (694,591 ) (1,224,763 ) (734,858 ) Canceled, Expired or Forfeited — — — — Nonvested - End of Year — $ — 1,157,653 $ 694,591 |
Business Segments and Geograp39
Business Segments and Geographic Area Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information By Segment | The following are selected results of reportable segments (in thousands): Segments 2016 Foam Coatings Totals Sales $ 73,919 $ 12,467 $ 86,386 Depreciation 75 13 88 Amortization of Other Intangible Assets 213 36 249 Interest Expense 640 108 748 Segment Profit 10,213 1,984 12,197 Segment Assets (1) 22,538 4,566 27,104 Expenditures for Segment Assets $ 123 $ 21 $ 144 2015 Foam Coatings Totals Sales $ 66,030 $ 12,619 $ 78,649 Depreciation 110 21 131 Amortization of Other Intangible Assets 215 41 256 Interest Expense 955 183 1,138 Segment Profit 4,514 1,815 6,329 Segment Assets (1) 19,341 4,372 23,713 Expenditures for Segment Assets $ 48 $ 9 $ 57 |
Schedule of Reconciliations of Reportable Segment Profit or Loss | The following are reconciliations of reportable segment profit or loss, and assets, to the Company’s totals for the years indicated: Segments Profit 2016 2015 Total Profit for Reportable Segments $ 12,197 $ 6,329 Unallocated Amounts: Corporate Expenses (5,508 ) (6,514 ) Income (Loss) Before Income Taxes $ 6,689 $ (185 ) |
Schedule of Reconciliation of Assets From Segment to Consolidated | Assets 2016 2015 Total Assets for Reportable Segments (1) $ 27,104 $ 23,713 Other Unallocated Amounts (2) 2,291 2,296 Total $ 29,395 $ 26,009 (1) Segment assets are the total assets used in the operation of each segment. (2) Includes corporate assets which are principally cash and prepaid expenses. |
Schedule of Revenue from External Customers and Long-Lived Assets By Geographical Areas [Table Text Block] | Geographic Area (in thousands): United Rest of 2016 States Europe Middle East World Total Sales $ 81,393 $ 2,567 $ 3 $ 2,423 $ 86,386 Long-Lived Assets $ 6,431 $ — $ — $ — $ 6,431 United Rest of 2015 States Europe Middle East World Total Sales $ 76,589 $ 687 $ — $ 1,373 $ 78,649 Long-Lived Assets $ 6,838 $ — $ — $ — $ 6,838 |
Summary of Organization, Basi40
Summary of Organization, Basis of Presentation, and Critical Accounting Policies, Estimates, and Assumptions (Details) | 12 Months Ended | |||
Dec. 31, 2016USD ($)segment | Dec. 31, 2015USD ($) | Feb. 11, 2005 | Sep. 01, 2001 | |
Business Acquisition [Line Items] | ||||
Deferred tax assets | $ 21,900,000 | $ 27,400,000 | ||
Valuation allowance | 22,300,000 | 27,800,000 | ||
Deferred tax assets at carrying value | 414,000 | 365,000 | ||
Unrecognized tax benefits | 0 | |||
Increase (decrease) in unrecognized tax benefit | 0 | |||
Accrued interest and penalties | 0 | |||
Net property, plant, and equipment | 985,000 | 1,087,000 | ||
Depreciation expense | 265,000 | 358,000 | ||
Impairment of property, plant, and equipment | 0 | 0 | ||
Goodwill | $ 4,235,000 | 4,235,000 | ||
Number of reporting units | segment | 2 | |||
Goodwill impairment | 0 | |||
Other intangible assets, net | $ 1,180,000 | 1,197,000 | ||
Amortization of other intangible assets | 277,000 | 284,000 | ||
Impairment of long-lived assets | 0 | 0 | ||
Shipping and handling revenue | 834,000 | 958,000 | ||
Freight costs | 4,335,000 | 4,219,000 | ||
Share-based compensation expense | 988,000 | 1,180,000 | ||
Allowance for doubtful accounts | 366,000 | 545,000 | ||
Deferred advertising costs | $ 181,000 | 116,000 | ||
Total advertising and marketing costs expensed | $ 1,100,000 | |||
Infiniti Products, Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Capital stock acquired (percent) | 100.00% | |||
Lapolla Industries, Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Capital stock acquired (percent) | 100.00% |
Dependence on a few suppliers (
Dependence on a few suppliers (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Supplier Concentration Risk [Member] | Raw Materials and Finished Goods [Member] | Three Largest Suppliers [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 42.00% | 39.00% |
Trade Receivables (Details)
Trade Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Receivables [Abstract] | ||
Trade Receivables | $ 12,874 | $ 10,551 |
Less: Allowance for Doubtful Accounts | (366) | (545) |
Trade Receivables, Net | $ 12,508 | $ 10,006 |
Contracts - Costs, Estimated Ea
Contracts - Costs, Estimated Earnings and Billings on Uncompleted Contracts (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Costs in Excess of Billings on Uncompleted Contracts or Programs [Abstract] | ||
Costs Incurred on Uncompleted Contracts | $ 274,000 | $ 1,089,000 |
Estimated Earnings on Uncompleted Contracts | 83,000 | 306,000 |
Uncompleted Contracts | 357,000 | 1,395,000 |
Less: Billings to Date | (378,000) | (1,404,000) |
Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | $ 21,000 | $ 9,000 |
Contracts - Costs and Estimated
Contracts - Costs and Estimated Earnings on Uncompleted Contract in the Accompanying Balance Sheets (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Contractors [Abstract] | ||
Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | $ 0 | $ 42,000 |
Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts | 21,000 | 51,000 |
Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | $ 21,000 | $ 9,000 |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw Materials | $ 2,157,000 | $ 2,599,000 |
Finished Goods | 4,453,000 | 5,575,000 |
Inventories, Net | $ 6,610,000 | $ 8,174,000 |
Prepaid Expenses and Other Cu46
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid Insurances | $ 735 | $ 637 |
Prepaid Marketing | 181 | 116 |
Prepaid Consulting | 94 | 58 |
Prepaid Other | 1,064 | 363 |
Total Prepaid Expenses and Other Current Assets | $ 2,074 | $ 1,174 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment | $ 4,136,000 | $ 4,521,000 |
Less: Accumulated Depreciation | (3,151,000) | (3,434,000) |
Total Property, Plant and Equipment, Net | $ 985,000 | 1,087,000 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Total Property, Plant and Equipment | $ 244,000 | 462,000 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment | $ 269,000 | 289,000 |
Leasehold Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 13 years | |
Leasehold Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 15 years | |
Office Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment | $ 159,000 | 307,000 |
Office Furniture and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Office Furniture and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 7 years | |
Computers and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment | $ 907,000 | 946,000 |
Computers and Software [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Computers and Software [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment | $ 2,557,000 | $ 2,517,000 |
Machinery and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 20 years |
Property, Plant and Equipment P
Property, Plant and Equipment Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 265 | $ 358 |
Cost of Sales [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 168 | $ 212 |
Goodwill and Other Intangible49
Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill [Line Items] | ||
Goodwill | $ 4,235,000 | $ 4,235,000 |
Operating Segments [Member] | Foam [Member] | ||
Goodwill [Line Items] | ||
Goodwill | 1,303,000 | 2,932,000 |
Operating Segments [Member] | Coatings [Member] | ||
Goodwill [Line Items] | ||
Goodwill | $ 2,932,000 | $ 1,303,000 |
Goodwill and Other Intangible50
Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 4,350 | $ 4,090 |
Accumulated Amortization | (3,170) | (2,893) |
Net Amount | 1,180 | 1,197 |
Product Formulations [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 138 | 138 |
Accumulated Amortization | (104) | (95) |
Net Amount | $ 34 | 43 |
Amortization Period | 15 years | |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 750 | 750 |
Accumulated Amortization | (419) | (369) |
Net Amount | $ 331 | 381 |
Amortization Period | 15 years | |
Approvals and Certifications [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 3,462 | 3,202 |
Accumulated Amortization | (2,647) | (2,429) |
Net Amount | $ 815 | $ 773 |
Amortization Period | 5 years |
Goodwill and Other Intangible51
Goodwill and Other Intangible Assets - Schedule of Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
2,016 | $ 264 |
2,017 | 264 |
2,018 | 264 |
2,019 | 257 |
2,020 | 50 |
Thereafter | 81 |
Product Formulations [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
2,016 | 9 |
2,017 | 9 |
2,018 | 9 |
2,019 | 7 |
2,020 | 0 |
Thereafter | 0 |
Trade Names [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
2,016 | 50 |
2,017 | 50 |
2,018 | 50 |
2,019 | 50 |
2,020 | 50 |
Thereafter | 81 |
Approvals and Certifications [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
2,016 | 205 |
2,017 | 205 |
2,018 | 205 |
2,019 | 200 |
2,020 | 0 |
Thereafter | $ 0 |
Deposits and Other Non-Curren52
Deposits and Other Non-Current Assets, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid Expenses | $ 8 | $ 25 |
Other Receivables | 9 | 5 |
Deposits | 64 | 64 |
Total Deposits and Other-Non-Current Assets | $ 81 | $ 94 |
Accrued Expenses and Other Cu53
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Accrued Payroll | $ 3 | $ (6) |
Accrued Commissions | 172 | 129 |
Accrued Inventory | 249 | 438 |
Accrued Taxes and Other | 1,990 | 1,725 |
Accrued Insurance | 490 | 459 |
Deferred Finance Charge Income | 13 | 28 |
Total Accrued Expenses and Other Current Liabilities | $ 2,917 | $ 2,773 |
Financing Instruments Financing
Financing Instruments Financing Instruments - Summary of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Outstanding balance on loan | $ 9,000 | $ 14,424 |
Debt Instrument, Unamortized Discount (Premium) And Debt Issuance Costs, Net | (55) | (287) |
Long-term Debt | $ 8,945 | 14,137 |
Secured Debt [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (percent) | 11.66% | |
Outstanding balance on loan | $ 0 | 7,688 |
Line of Credit [Member] | Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (percent) | 2.78% | |
Outstanding balance on loan | $ 9,000 | 0 |
Line of Credit [Member] | Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate (percent) | 4.60% | |
Outstanding balance on loan | $ 0 | $ 6,736 |
Financing Instruments - Loan an
Financing Instruments - Loan and Security Agreement (Details) | Sep. 07, 2016USD ($)covenant | Apr. 30, 2016USD ($) | Apr. 21, 2016USD ($) | Sep. 01, 2010USD ($) | Mar. 31, 2018 | Sep. 30, 2017 | Sep. 07, 2019 | Jul. 01, 2019USD ($) | Jan. 01, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 10, 2013USD ($) |
Line of Credit Facility [Line Items] | |||||||||||||
Long-term Debt | $ 8,945,000 | $ 14,137,000 | |||||||||||
Repayments of debt | $ 2,000,000 | ||||||||||||
Outstanding balance on loan | 9,000,000 | 14,424,000 | |||||||||||
Line of Credit [Member] | Loan Agreement [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Maximum borrowing capacity | $ 15,000,000 | ||||||||||||
Term of debt instrument | 3 years | ||||||||||||
Number of debt covenants | covenant | 2 | ||||||||||||
Debt covenant, book value of accounts receivable to all borrowing and interest bearing liabilities, percentage | 85.00% | ||||||||||||
Debt covenant, book value of inventory to all borrowings and interest bearing liabilities, percentage | 55.00% | ||||||||||||
Debt covenant, book value of property, plant and equipment to all borrowings and interest bearing liabilities, percentage | 50.00% | ||||||||||||
Debt instrument, covenant, fixed charge coverage ratio | 1.20 | ||||||||||||
Long-term Debt | $ 8,500,000 | $ 9,700,000 | |||||||||||
Long-term debt, weighted average interest rate | 2.78% | ||||||||||||
Cash available under loan | $ 3,200,000 | ||||||||||||
Line of Credit [Member] | Loan Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Interest rate | 2.25% | ||||||||||||
Line of Credit [Member] | Revolver Loan [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Maximum borrowing capacity | $ 12,000,000 | 2,200,000 | |||||||||||
Repayments of debt | $ 2,700,000 | ||||||||||||
Outstanding balance on loan | $ 6,700,000 | ||||||||||||
Weighted average interest rate | 4.60% | ||||||||||||
Percentage of eligible accounts receivable | 85.00% | ||||||||||||
Percentage of eligible inventory | 65.00% | ||||||||||||
Debt borrowing base, percentage of eligible inventory, raw materials | 30.00% | ||||||||||||
Inventory included in base rate calculation (up to) | $ 6,000,000 | ||||||||||||
Secured Debt [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Outstanding balance on loan | $ 0 | $ 7,688,000 | |||||||||||
Secured Debt [Member] | Note Purchase Agreement [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Maximum borrowing capacity | $ 7,200,000 | ||||||||||||
Repayments of debt | $ 5,800,000 | $ 1,900,000 | |||||||||||
Weighted average interest rate | 25.60% | ||||||||||||
Scenario, Forecast [Member] | Line of Credit [Member] | Loan Agreement [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Maximum borrowing capacity | $ 12,000,000 | ||||||||||||
Debt covenant, asset coverage ratio | 1.15 | 1.10 | 1.20 | ||||||||||
Subsequent Event [Member] | Line of Credit [Member] | Loan Agreement [Member] | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Line of credit facility borrowing capacity, quarterly decrease in borrowing capacity | $ 250,000 |
Financing Instruments - Note Pu
Financing Instruments - Note Purchase Agreements - Enhanced Note (Details) - USD ($) | Sep. 07, 2016 | Apr. 30, 2016 | Apr. 21, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 10, 2013 |
Line of Credit Facility [Line Items] | ||||||
Outstanding balance on loan | $ 9,000,000 | $ 14,424,000 | ||||
Repayments of debt | $ 2,000,000 | |||||
Secured Debt [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Outstanding balance on loan | $ 0 | $ 7,688,000 | ||||
Effective interest rate (percent) | 11.66% | |||||
Secured Debt [Member] | Note Purchase Agreement [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 7,200,000 | |||||
Repayments of debt | $ 5,800,000 | $ 1,900,000 | ||||
Notes Payable, Noncurrent | $ 7,500,000 | |||||
Weighted average interest rate | 25.60% | |||||
Secured Debt [Member] | Enhanced Jobs for Texas [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | 5,700,000 | |||||
Secured Debt [Member] | Enhanced Texas Fund [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 1,500,000 |
Financing Instruments - Note 57
Financing Instruments - Note Purchase Agreements - Guaranty Agreement (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 10, 2013 | Dec. 31, 2016 | Dec. 31, 2015 |
Line of Credit Facility [Line Items] | |||
Common stock shares outstanding | 123,494,129 | 122,125,072 | |
Note Purchase Agreement [Member] | |||
Line of Credit Facility [Line Items] | |||
Stock issued during the period (shares) | 3,700,000 | ||
Restricted common stock par value (in USD per share) | $ 0.01 | ||
Stock closing price (in USD per share) | $ 0.60 | ||
Stock issued during the period, value | $ 2.2 | ||
Common stock shares outstanding | 3,681,000 | 2,523,347 | |
Common stock outstanding, value | $ 2.2 | $ 1.5 |
Financing Instruments - Note 58
Financing Instruments - Note Purchase Agreements - Chairman of the Board Commitment (Details) - USD ($) | Dec. 31, 2016 | Sep. 07, 2016 | Apr. 30, 2016 | Apr. 21, 2016 | Mar. 14, 2016 | Dec. 21, 2015 | Nov. 12, 2015 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 10, 2013 |
Debt Instrument [Line Items] | |||||||||||
Repayments of debt | $ 2,000,000 | ||||||||||
Repayments of related party debt | $ 0 | $ 500,000 | |||||||||
Board of Directors Chairman [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Granted | 500,000 | ||||||||||
Share price (in USD per share) | $ 0.40 | $ 0.294 | |||||||||
Term of stock option acquisition rights (years) | 3 years | 8 years | |||||||||
Grant-date fair value of option awards | $ 47,000 | ||||||||||
Repayments of related party debt | $ 150,000 | $ 500,000 | $ 500,000 | ||||||||
Repurchase of principal | $ 150,000 | $ 150,000 | $ 150,000 | ||||||||
Secured Debt [Member] | Note Purchase Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum borrowing capacity | $ 7,200,000 | ||||||||||
Repayments of debt | $ 5,800,000 | $ 1,900,000 |
Related Party Transactions - Ex
Related Party Transactions - Executive Employee Agreement (Details) - Adams Employment Agreement [Member] | Jan. 01, 2015USD ($)month |
Related Party Transaction [Line Items] | |
Annual base salary | $ | $ 190,000 |
Annual bonus as a percentage of base salary | 25.00% |
Annual bonus as a percentage of base salary increase option one | 30.00% |
Annual bonus as a percentage of base salary increase option two | 35.00% |
Annual bonus as a percentage of base salary increase option three | 35.00% |
EBITDA threshold one for increase in annual bonus | 110.00% |
EBITDA threshold two for increase in annual bonus | 120.00% |
EBITDA threshold three for increase in annual bonus | 120.00% |
Change in control bonus as a percentage of annual base salary | 25.00% |
Number of months salary for termination due to death or disability | 4 |
Number of months salary for termination without cause | 4 |
Change in control bonus threshold period | 4 months |
Number of months salary for termination within first twelve months | 12 |
Bonus period threshold | 12 months |
Non-competition provision period | 12 months |
Related Party Transactions - Re
Related Party Transactions - Related Party Transactions (Details) - USD ($) | Jan. 01, 2017 | Dec. 31, 2016 | Dec. 31, 2016 | Dec. 30, 2016 | Apr. 30, 2016 | Mar. 14, 2016 | Feb. 07, 2016 | Dec. 21, 2015 | Nov. 12, 2015 | Mar. 23, 2015 | Jan. 23, 2015 | Jan. 21, 2015 | Jan. 16, 2015 | Feb. 07, 2014 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 |
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||
Repayments of debt | $ 2,000,000 | ||||||||||||||||
Repayments of related party debt | $ 0 | $ 500,000 | |||||||||||||||
Richard J. Kurtz Option [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock (shares) | 800,000 | ||||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | ||||||||||||||||
Share price (in USD per share) | $ 0.40 | $ 0.294 | |||||||||||||||
Term of options granted | 8 years | ||||||||||||||||
Award vesting period (years) | 3 years | 8 years | |||||||||||||||
Grant-date fair value of option awards | $ 306,000 | $ 47,000 | |||||||||||||||
Granted | 500,000 | ||||||||||||||||
Repayments of related party debt | $ 150,000 | $ 500,000 | $ 500,000 | ||||||||||||||
Repurchase of principal | $ 150,000 | $ 150,000 | $ 150,000 | $ 150,000 | |||||||||||||
Kramer Options [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock (shares) | 2,000,000 | 850,000 | |||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 | |||||||||||||||
Share price (in USD per share) | $ 0.40 | $ 0.325 | |||||||||||||||
Forfeitures in period (shares) | 2,000,000 | ||||||||||||||||
Term of options granted | 8 years | 8 years | |||||||||||||||
Award vesting period (years) | 3 years | ||||||||||||||||
Options granted (shares) | 1,150,000 | ||||||||||||||||
Grant-date fair value of option awards | $ 766,000 | $ 86,000 | |||||||||||||||
Related Party Transaction, Additional Employment Term | 1 year | ||||||||||||||||
1/16/15 Adams Option [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock (shares) | 300,000 | ||||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | ||||||||||||||||
Share price (in USD per share) | $ 0.325 | ||||||||||||||||
Term of options granted | 8 years | ||||||||||||||||
Grant-date fair value of option awards | $ 94,000 | ||||||||||||||||
1/16/15 Adams Option [Member] | Tranche One [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Award vesting rights (percent) | 33.00% | ||||||||||||||||
1/16/15 Adams Option [Member] | Tranche Two [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Award vesting rights (percent) | 33.00% | ||||||||||||||||
1/16/15 Adams Option [Member] | Tranche Three [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Award vesting rights (percent) | 33.00% | ||||||||||||||||
Kurtz Note [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Principal repayments to note payable - related party | $ 250,000 | ||||||||||||||||
Effective interest rate (percent) | 8.00% | ||||||||||||||||
Twelfth Amendment [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Principal repayments to note payable - related party | $ 250,000 | ||||||||||||||||
Allowance for doubtful accounts receivable write-offs | 267,000 | ||||||||||||||||
Capital expenditures incurred but not yet paid | $ 150,000 | ||||||||||||||||
3/23/15 Schnitzer Option [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock (shares) | 300,000 | ||||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | ||||||||||||||||
Share price (in USD per share) | $ 0.41 | ||||||||||||||||
Term of options granted | 8 years | ||||||||||||||||
Grant-date fair value of option awards | $ 118,000 | ||||||||||||||||
3/23/15 Schnitzer Option [Member] | Tranche One [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Award vesting rights (percent) | 33.00% | ||||||||||||||||
3/23/15 Schnitzer Option [Member] | Tranche Two [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Award vesting rights (percent) | 33.00% | ||||||||||||||||
3/23/15 Schnitzer Option [Member] | Tranche Three [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Award vesting rights (percent) | 33.00% | ||||||||||||||||
Richard J. Kurtz Option [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||||
Share price (in USD per share) | $ 0.53 | $ 0.53 | $ 0.53 | ||||||||||||||
Options granted (shares) | 100,000 | ||||||||||||||||
Grant-date fair value of option awards | $ 53,000 | ||||||||||||||||
Servicing Contracts [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Shares issued for services (shares) | 1,035,743 | ||||||||||||||||
Restricted common stock issued for services | $ 418,000 | ||||||||||||||||
Majority Shareholder [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Shares issued for services (shares) | 1,157,653 | 1,224,763 | |||||||||||||||
Restricted common stock issued for services | $ 696,000 | $ 735,000 | |||||||||||||||
Chief Operating Officer [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Common stock par value (in USD per share) | $ 0.01 | ||||||||||||||||
Grant-date fair value of option awards | $ 16,000 | $ 16,000 | |||||||||||||||
Granted | 100,000 | ||||||||||||||||
Vested | 25,000 | 25,000 | 25,000 | ||||||||||||||
Related Party Transaction, Additional Employment Term | 1 year | ||||||||||||||||
Annual base salary | $ 190,000 | ||||||||||||||||
Subsequent Event [Member] | Chief Operating Officer [Member] | |||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||
Annual base salary | $ 210,000 |
Income Taxes - Components of Ta
Income Taxes - Components of Tax (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | ||
Federal | $ 162,000 | |
State | 100,000 | |
Total Current | 262,000 | |
Deferred: | ||
Federal | 49,000 | |
State | 0 | |
Total Deferred | 49,000 | $ 365,000 |
Total Tax Provision | $ 311,000 | 392,000 |
Selling, General and Administrative Expenses [Member] | ||
Current: | ||
Federal | 0 | |
State | 27,000 | |
Total Current | 27,000 | |
Deferred: | ||
Federal | 365,000 | |
State | 0 | |
Total Deferred | 365,000 | |
Total Tax Provision | $ 392,000 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Tax (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Line Items] | ||
Federal Income Tax Expense/(Benefit) | $ 2,274,000 | |
State Income Tax | 198,000 | |
Nondeductible Expenses | 168,000 | |
Provision to Return Reconciling Items | 3,112,000 | |
Change in Valuation Allowance | (5,442,000) | |
Other | 1,000 | |
Total Tax Provision | $ 311,000 | $ 392,000 |
Selling, General and Administrative Expenses [Member] | ||
Income Tax Disclosure [Line Items] | ||
Federal Income Tax Expense/(Benefit) | (62,000) | |
State Income Tax | 494,000 | |
Nondeductible Expenses | 40,000 | |
Provision to Return Reconciling Items | (3,211,000) | |
Change in Valuation Allowance | 3,229,000 | |
Other | (98,000) | |
Total Tax Provision | $ 392,000 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Taxes (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax Assets: | ||
Federal and State Net Operating Loss Carry-Forward | $ 20,361,000 | $ 25,986,000 |
Share-Based Compensation | 1,084,000 | 1,151,000 |
Other Temporary Differences | 1,167,000 | 1,051,000 |
Total | 22,612,000 | 28,188,000 |
Deferred Tax Liabilities | ||
Tax Goodwill | (414,000) | (365,000) |
Depreciation | (276,000) | (280,000) |
Other Temporary Differences | 0 | (130,000) |
Total | (690,000) | (775,000) |
Net Deferred Tax Asset | 21,922,000 | 27,413,000 |
Valuation Allowance | (22,336,000) | (27,778,000) |
Deferred Tax Liability | $ (414,000) | $ (365,000) |
Income Taxes Income Taxes - Nar
Income Taxes Income Taxes - Narrative (Details) $ in Millions | Dec. 31, 2015USD ($) |
Federal [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforward | $ 59.5 |
State [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforward | $ 2.7 |
Commitments and Contingencies -
Commitments and Contingencies - Operating Lease (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2,016 | $ 483 | |
2,017 | 487 | |
2,018 | 490 | |
Rent expense | $ 328 | $ 343 |
Commitments and Contingencies66
Commitments and Contingencies - Legal Proceedings (Details) $ in Thousands | Feb. 04, 2015USD ($) |
Neil and Kristine Markey Litigation [Member] | |
Loss Contingencies [Line Items] | |
Damages sought | $ 800 |
Net Income (Loss) Per Common 67
Net Income (Loss) Per Common Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Net loss available to common shareholders | $ 6,378,124 | $ (577,000) |
Weighted average common shares outstanding (shares) | 122,812,680 | 121,283,000 |
Dilutive effect of employee equity incentive plans (shares) | 484,389 | 0 |
Weighted average common shares outstanding, assuming dilution (shares) | 123,297,069 | 121,283,000 |
Basic earnings per common share (usd per share) | $ 0.05 | $ 0 |
Diluted earnings per common share (usd per share) | $ 0.05 | $ 0 |
Net Income (Loss) Per Common 68
Net Income (Loss) Per Common Share - Narrative (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | ||
Number of antidilutive securities excluded from computation of earnings per share (shares) | 400,000 | 2,667,500 |
Securities Transactions (Detail
Securities Transactions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Securities Financing Transaction [Line Items] | ||
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 |
Servicing Contracts [Member] | ||
Securities Financing Transaction [Line Items] | ||
Shares issued for services (shares) | 86,404 | |
Restricted common stock par value (in USD per share) | $ 0.01 | |
Value of stock issued for service | $ 38,000 | |
Affiliated Entity [Member] | ||
Securities Financing Transaction [Line Items] | ||
Restricted common stock par value (in USD per share) | $ 0.01 | |
Shares issued during the period (shares) | 1,157,653 | |
Value of shares issued in the period | $ 696,000 | |
Shares issued during the period for a stock bonus (shares) | 25,000 | |
Common stock par value (in USD per share) | $ 0.01 | |
Value of shares issued for stock bonus plan | $ 16,000 |
Share-Based Payment Arrangeme70
Share-Based Payment Arrangements - Narrative (Details) | Dec. 10, 2013shares | Feb. 22, 2011USD ($)$ / sharesshares | Dec. 31, 2016USD ($)plan$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($) | Dec. 09, 2013USD ($)$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of share-based compensation plans | plan | 3 | |||||
Share based compensation expense | $ | $ 1,683,000 | $ 1,964,000 | ||||
Common stock par value (in USD per share) | $ / shares | $ 0.01 | $ 0.01 | ||||
Equity Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares available for grant (shares) | 10,000,000 | |||||
Shares issuable and available for grant (shares) | 1,982,500 | |||||
Equity Incentive Plan [Member] | Stock Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted | 2,800,000 | 2,100,000 | ||||
Total unrecognized compensation cost | $ | $ 896,000 | $ 1,415,168 | ||||
Grant-date fair value of option awards | $ | $ 634,866 | $ 79,387 | ||||
Shares Price (in USD per share) | $ / shares | $ 0 | $ 0 | ||||
Options (in USD per share) | $ / shares | $ 0.41 | $ 0.73 | ||||
Period for recognition of costs not yet recognized | 2 years 1 month 13 days | |||||
Equity Incentive Plan [Member] | Stock Option [Member] | Weighted Average [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Period for recognition of costs not yet recognized | 25 months 15 days | |||||
Equity Incentive Plan [Member] | Stock Award [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted | 100,000 | 0 | ||||
Vested | 125,000 | 25,000 | ||||
Grant-date fair value of option awards | $ | $ 0 | $ 16,250 | $ 32,500 | |||
Weightd average grant date fair value | $ | $ 53,000 | $ 0 | ||||
Equity Incentive Plan [Member] | Directors, Officers, and Key Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted | 2,925,000 | 5,417,500 | ||||
Vested | 125,000 | |||||
Equity Incentive Plan [Member] | Directors, Officers, and Key Employees [Member] | Stock Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted | 2,800,000 | 5,317,500 | ||||
Equity Incentive Plan [Member] | Directors, Officers, and Key Employees [Member] | Stock Award [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vested | 100,000 | |||||
Advisor Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share based compensation expense | $ | $ 2,850,000 | |||||
Granted | 5,000,000 | 86,404 | 1,035,743 | |||
Vested | 86,404 | 1,035,743 | ||||
Grant-date fair value of option awards | $ | $ 0 | $ 0 | 0 | |||
Common stock par value (in USD per share) | $ / shares | $ 0.01 | |||||
Award vesting period (years) | 3 years | |||||
Shares Price (in USD per share) | $ / shares | $ 0.57 | $ 0.40 | ||||
Weightd average grant date fair value | $ | $ 38,000 | $ 418,000 | ||||
Advisor Plan [Member] | Weighted Average [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares Price (in USD per share) | $ / shares | $ 0.44 | |||||
Guaranty Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted | 3,681,000 | 0 | 0 | |||
Vested | 1,157,653 | 1,224,763 | ||||
Grant-date fair value of option awards | $ | $ 0 | $ 694,591 | $ 1,429,449 | $ 2,208,600 | ||
Common stock par value (in USD per share) | $ / shares | $ 0.01 | |||||
Weightd average grant date fair value | $ | $ 0 | $ 0 | ||||
Options (in USD per share) | $ / shares | $ 0.60 |
Share-Based Payment Arrangeme71
Share-Based Payment Arrangements - Equity Incentive Plan (Details) - Stock Option [Member] - Equity Incentive Plan [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Options | ||
Outstanding-Beginning of Year | 5,017,500 | 7,277,500 |
Granted | 2,800,000 | 2,100,000 |
Exercised | 0 | 0 |
Canceled, Expired or Forfeited | 0 | (4,360,000) |
Outstanding - End of Year | 7,817,500 | 5,017,500 |
Exercisable - End of Year | 5,032,420 | 2,667,500 |
Weighted-Average Exercise Price | ||
Outstanding - Beginning of year (in USD per share) | $ 0.48 | $ 0.47 |
Granted (in USD per share) | 0.40 | 0.33 |
Exercised (in USD per share) | 0 | 0 |
Canceled, Expired or Forfeited (in USD per share) | 0 | 0.46 |
Outstanding - End of year (in USD per share) | 0.42 | 0.48 |
Options exercisable (in USD per share) | $ 0.41 | $ 0.73 |
Share-Based Payment Arrangeme72
Share-Based Payment Arrangements - Equity Plan and Warrant Summary (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
$.29-$.59 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of exercise prices, lower limit (in USD per share) | $ 0.20 | |
Range of exercise prices, upper limit (in USD per share) | 0.39 | |
$.60-$.64 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of exercise prices, lower limit (in USD per share) | 0.40 | |
Range of exercise prices, upper limit (in USD per share) | 0.59 | |
$.65-$.80 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of exercise prices, lower limit (in USD per share) | 0.60 | |
Range of exercise prices, upper limit (in USD per share) | $ 0.80 | |
Stock Option [Member] | Equity Incentive Plan [Member] | $.29-$.59 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Number Outstanding (in shares) | 2,380,000 | 3,230,000 |
Weighted Average Remaining Contractual Life (Years) | 5 years 6 months | 6 years 6 months |
Outstanding, Weighted Average Exercise Price (in USD per share) | $ 0.33 | $ 0.29 |
Number Exercisable (in shares) | 2,205,000 | 1,580,000 |
Exercisable, Weighted Average Exercise Price (in USD per share) | $ 0.33 | $ 0.24 |
Stock Option [Member] | Equity Incentive Plan [Member] | $.60-$.64 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Number Outstanding (in shares) | 4,837,500 | 3,587,500 |
Weighted Average Remaining Contractual Life (Years) | 3 years 10 months 24 days | 4 years 2 months 12 days |
Outstanding, Weighted Average Exercise Price (in USD per share) | $ 0.42 | $ 0.44 |
Number Exercisable (in shares) | 2,427,420 | 887,500 |
Exercisable, Weighted Average Exercise Price (in USD per share) | $ 0.43 | $ 0.45 |
Stock Option [Member] | Equity Incentive Plan [Member] | $.65-$.80 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Number Outstanding (in shares) | 600,000 | 600,000 |
Weighted Average Remaining Contractual Life (Years) | 2 years 1 month 6 days | 3 years 1 month 6 days |
Outstanding, Weighted Average Exercise Price (in USD per share) | $ 0.71 | $ 0.71 |
Number Exercisable (in shares) | 400,000 | 200,000 |
Exercisable, Weighted Average Exercise Price (in USD per share) | $ 0.71 | $ 0.71 |
Share-Based Payment Arrangeme73
Share-Based Payment Arrangements - Stock Awards Plan (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Weighted-Average Grant-Date Fair Value | ||
Canceled, Expired or Forfeited | $ 0 | |
Stock Award [Member] | Equity Incentive Plan [Member] | ||
Number of Shares | ||
Nonvested - Beginning of Year | 25,000 | 50,000 |
Granted | 100,000 | 0 |
Vested | (125,000) | (25,000) |
Canceled, Expired or Forfeited | 0 | 0 |
Nonvested - End of Year | 0 | 25,000 |
Weighted-Average Grant-Date Fair Value | ||
Nonvested - Beginning of Year | $ 16,250 | $ 32,500 |
Granted | 53,000 | 0 |
Vested | (69,250) | (16,250) |
Canceled, Expired or Forfeited | 0 | 0 |
Nonvested - End of Year | $ 0 | $ 16,250 |
Share-Based Payment Arrangeme74
Share-Based Payment Arrangements - Stock Advisor Plan (Details) - USD ($) | Feb. 22, 2011 | Dec. 31, 2016 | Dec. 31, 2015 |
Weighted-Average Grant-Date Fair Value | |||
Canceled, Expired or Forfeited | $ 0 | ||
Advisor Plan [Member] | |||
Number of Shares | |||
Nonvested - Beginning of Year | 0 | 0 | |
Granted | 5,000,000 | 86,404 | 1,035,743 |
Vested | (86,404) | (1,035,743) | |
Canceled, Expired or Forfeited | 0 | 0 | |
Nonvested - End of Year | 0 | 0 | |
Weighted-Average Grant-Date Fair Value | |||
Nonvested - Beginning of Year | $ 0 | $ 0 | |
Granted | 38,000 | 418,000 | |
Vested | (38,063) | (417,662) | |
Canceled, Expired or Forfeited | 0 | ||
Nonvested - End of Year | $ 0 | $ 0 |
Share-Based Payment Arrangeme75
Share-Based Payment Arrangements - Guaranty Plan (Details) - USD ($) | Dec. 10, 2013 | Dec. 31, 2016 | Dec. 31, 2015 |
Weighted-Average Grant-Date Fair Value | |||
Canceled, Expired or Forfeited | $ 0 | ||
Guaranty Plan [Member] | |||
Number of Shares | |||
Nonvested - Beginning of Year | 1,157,653 | 2,382,416 | |
Granted | 3,681,000 | 0 | 0 |
Vested | (1,157,653) | (1,224,763) | |
Canceled, Expired or Forfeited | 0 | 0 | |
Nonvested - End of Year | 0 | 1,157,653 | |
Weighted-Average Grant-Date Fair Value | |||
Nonvested - Beginning of Year | $ 2,208,600 | $ 694,591 | $ 1,429,449 |
Granted | 0 | 0 | |
Vested | (694,591) | (734,858) | |
Canceled, Expired or Forfeited | 0 | 0 | |
Nonvested - End of Year | $ 0 | $ 694,591 |
Business Segments and Geograp76
Business Segments and Geographic Area Information - Reportable Segments (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)segment | Dec. 31, 2015USD ($) | |
Segment Reporting [Abstract] | ||
Number of operating segments | segment | 2 | |
Segment Reporting Information [Line Items] | ||
Sales | $ 86,386 | $ 78,649 |
Depreciation | 88 | 131 |
Amortization of Other Intangible Assets | 249 | 256 |
Interest Expense | 748 | 1,138 |
Segment Profit | 12,197 | 6,329 |
Segment Assets | 27,104 | 23,713 |
Expenditures for Segment Assets | 144 | 57 |
Operating Segments [Member] | Foam [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales | 73,919 | 66,030 |
Depreciation | 75 | 110 |
Amortization of Other Intangible Assets | 213 | 215 |
Interest Expense | 640 | 955 |
Segment Profit | 10,213 | 4,514 |
Segment Assets | 22,538 | 19,341 |
Expenditures for Segment Assets | 123 | 48 |
Operating Segments [Member] | Coatings [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales | 12,467 | 12,619 |
Depreciation | 13 | 21 |
Amortization of Other Intangible Assets | 36 | 41 |
Interest Expense | 108 | 183 |
Segment Profit | 1,984 | 1,815 |
Segment Assets | 4,566 | 4,372 |
Expenditures for Segment Assets | $ 21 | $ 9 |
Business Segments and Geograp77
Business Segments and Geographic Area Information - Reconciliation of Reportable Segment Profit or Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||
Total Profit for Reportable Segments | $ 12,197 | $ 6,329 |
Unallocated Amounts: | ||
Corporate Expenses | (5,508) | (6,514) |
Income (Loss) from Continuing Operations before Income Taxes, Domestic | $ 6,689 | $ (185) |
Business Segments and Geograp78
Business Segments and Geographic Area Information - Reconciliation of Reportable Segment Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Segment Reporting [Abstract] | ||
Total Assets for Reportable Segments | $ 27,104 | $ 23,713 |
Other Unallocated Amounts | 2,291 | 2,296 |
Total Assets | $ 29,395 | $ 26,009 |
Business Segments and Geograp79
Business Segments and Geographic Area Information - Geographic Area Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Sales | $ 86,386 | $ 78,649 |
Long-Lived Assets | 6,431 | 6,838 |
United States [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Sales | 81,393 | 76,589 |
Long-Lived Assets | 6,431 | 6,838 |
Europe [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Sales | 2,567 | 687 |
Long-Lived Assets | 0 | 0 |
Middle East [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Sales | 3 | 0 |
Long-Lived Assets | 0 | 0 |
Rest of the World [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Sales | 2,423 | 1,373 |
Long-Lived Assets | $ 0 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Mar. 31, 2017 | Feb. 15, 2017 | Jan. 05, 2017 | Jan. 01, 2017 | Mar. 14, 2016 | Nov. 12, 2015 | Dec. 31, 2016 | Dec. 31, 2015 |
Subsequent Event [Line Items] | ||||||||
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 | ||||||
Board of Directors Chairman [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Common stock par value (in USD per share) | $ 0.01 | |||||||
Share price (in USD per share) | $ 0.40 | $ 0.294 | ||||||
Term of options granted | 8 years | |||||||
Award vesting period (years) | 3 years | 8 years | ||||||
Grant-date fair value of option awards | $ 306,000 | $ 47,000 | ||||||
Subsequent Event [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Dividends declared (USD per share) | $ 0.01 | |||||||
Stock Option [Member] | Subsequent Event [Member] | Board of Directors Chairman [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Options granted (shares) | 100,000 | |||||||
Common stock par value (in USD per share) | $ 0.01 | |||||||
Share price (in USD per share) | $ 0.53 | |||||||
Stock Option [Member] | Subsequent Event [Member] | Director [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Options granted (shares) | 400,000 | |||||||
Common stock par value (in USD per share) | $ 0.01 | |||||||
Share price (in USD per share) | $ 0.50 | |||||||
Term of options granted | 8 years | |||||||
Right to acquire shares | 100,000 | |||||||
Award vesting period (years) | 3 years | |||||||
Grant-date fair value of option awards | $ 191,000 | |||||||
Tranche One [Member] | Stock Option [Member] | Subsequent Event [Member] | Board of Directors Chairman [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 25,000 | |||||||
Tranche One [Member] | Stock Option [Member] | Subsequent Event [Member] | Director [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 33,333 | |||||||
Tranche Two [Member] | Stock Option [Member] | Subsequent Event [Member] | Board of Directors Chairman [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 25,000 | |||||||
Tranche Two [Member] | Stock Option [Member] | Subsequent Event [Member] | Director [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 33,333 | |||||||
Tranche Three [Member] | Stock Option [Member] | Subsequent Event [Member] | Board of Directors Chairman [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 25,000 | |||||||
Tranche Three [Member] | Stock Option [Member] | Subsequent Event [Member] | Director [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 33,334 | |||||||
Tranche Four [Member] | Stock Option [Member] | Subsequent Event [Member] | Board of Directors Chairman [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Vesting in period | 25,000 |