| | |
Per Share
|
| |
Without
Over-allotment option |
| |
With
Over-allotment option |
| |||||||||
Public Offering Price
|
| | | $ | 3.00 | | | | | $ | 12,600,000 | | | | | $ | 14,490,000 | | |
Underwriting discounts and commissions paid(1)
|
| | | $ | 0.27 | | | | | $ | 1,134,000 | | | | | $ | 1,304,100 | | |
Proceeds, before expenses, to us
|
| | | $ | 2.73 | | | | | $ | 11,466,000 | | | | | $ | 13,185,900 | | |
| | |
Page
|
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| | | | 84 | | | |
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| | | | F-1 | | |
| | |
Nine Months
Ended March 31, 2021 |
| |
Nine Months
Ended March 31, 2020 |
| |
Year Ended
June 30, |
| |||||||||||||||
| | |
2019
|
| |
2020
|
| ||||||||||||||||||
| | | | | | | | | | | | | | |
(in thousands, except share and per
share data) |
| |||||||||
Statement of Operations Data: | | | | | | | | | | | | | | | | ||||||||||
Net sales
|
| | | $ | 5,076 | | | | | $ | 15,521 | | | | | $ | 20,812 | | | | | $ | 16,367 | | |
Cost of sales
|
| | | | 3,786 | | | | | | 11,498 | | | | | | 15,575 | | | | | | 12,033 | | |
Gross profit
|
| | | | 1,290 | | | | | | 4,023 | | | | | | 5,237 | | | | | | 4,334 | | |
Expenses:
|
| | | | | | | | | | | | | | | ||||||||||
Research and development
|
| | | | 103 | | | | | | 205 | | | | | | 318 | | | | | | 240 | | |
Selling, general and administrative
|
| | | | 2,140 | | | | | | 4,021 | | | | | | 4,958 | | | | | | 4,714 | | |
Other expense (income), net
|
| | | | 194 | | | | | | 183 | | | | | | (4) | | | | | | 263 | | |
Total expenses
|
| | | | 2,437 | | | | | | 4,409 | | | | | | 5,272 | | | | | | 5,217 | | |
Net loss
|
| | | $ | (1,147) | | | | | $ | (386) | | | | | $ | (35) | | | | | $ | (883) | | |
Pro Forma C Corporation Information (Unaudited)
|
| | | | | ||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||
Historical net loss before income taxes
|
| | | $ | (1,147) | | | | | $ | (386) | | | | | $ | (35) | | | | | $ | (883) | | |
Pro forma benefit from income taxes
|
| | | | (321) | | | | | | (108) | | | | | | (10) | | | | | | (247) | | |
Pro forma net loss
|
| | | $ | (826) | | | | | $ | (278) | | | | | $ | (25) | | | | | $ | (636) | | |
Pro forma net loss per common share basic(1)(2)
|
| | | $ | (.15) | | | | | $ | (.05) | | | | | $ | (.01) | | | | | $ | (.11) | | |
Pro forma shares outstanding basic(2)
|
| | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | |
Pro forma net loss per common share diluted(1)(2)
|
| | | $ | (.15) | | | | | $ | (.05) | | | | | $ | (.01) | | | | | $ | (.11) | | |
Pro forma shares outstanding diluted(2)
|
| | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | |
| | |
As of March 31, 2021
|
| |||||||||
| | |
Actual
|
| |
As Adjusted(1)(3)
|
| ||||||
| | |
(in thousands)
|
| |||||||||
Balance Sheet Data: | | | | | | | | | | | | | |
Cash
|
| | | $ | 1,097 | | | | | $ | 11,748 | | |
Working capital (working capital deficit)
|
| | | | (885) | | | | | | 9,766 | | |
Total assets
|
| | | | 5,795 | | | | | | 15,677 | | |
Total members’ (deficit)/stockholders’ equity
|
| | | | (2,116) | | | | | | 9,100 | | |
| | |
As of March 31, 2021
|
| |||||||||||||||
| | |
Actual
|
| |
Pro Forma
|
| |
Pro Forma
As Adjusted |
| |||||||||
| | |
(in thousands, except share and per share data)
|
| |||||||||||||||
Cash and cash equivalents
|
| | | $ | 1,097 | | | | | $ | 1,097 | | | | | $ | 11,748 | | |
Long-term debt
|
| | | $ | 3,288 | | | | | $ | 3,288 | | | | | $ | 1,954 | | |
Stockholders’/members’ equity: | | | | | | | | | | | | | | | | | | | |
Preferred stock, $0.0001 par value; no shares authorized, issued or outstanding, actual; 10,000,0000 authorized, no shares issued or outstanding actual, pro forma and pro forma as adjusted
|
| | | | — | | | | | | — | | | | | | — | | |
Common stock, $0.0001 par value; no shares authorized, no shares issued and outstanding, actual; 100,000,000 shares authorized, 5,666,667 shares issued and outstanding, pro forma; 100,000,000 shares authorized, 9,866,667 shares issued and outstanding, pro forma as adjusted
|
| | | | — | | | | | | 1 | | | | | | 1 | | |
Members’ deficit
|
| | | | (11,660) | | | | | | — | | | | | | — | | |
Additional paid-in capital
|
| | | | — | | | | | | (11,661) | | | | | | (445) | | |
Retained earnings
|
| | | | 9,544 | | | | | | 9,544 | | | | | | 9,544 | | |
Total stockholders’/members’ equity (deficit)
|
| | | | (2,116) | | | | | | (2,116) | | | | | | 9,100 | | |
Total capitalization
|
| | | $ | 1,172 | | | | | $ | 1,172 | | | | | $ | 11,054 | | |
|
Initial public offering price per share
|
| | | $ | 3.00 | | |
|
Pro forma net tangible book value as of March 31, 2021
|
| | | $ | (.73) | | |
|
Increase attributable to new investors in this offering
|
| | | $ | 1.53 | | |
|
Adjusted pro forma net tangible book value after this offering
|
| | | $ | .80 | | |
|
Dilution in pro forma net tangible book value to new investors in this offering
|
| | | $ | 2.20 | | |
| | |
Shares
Acquired |
| |
Total
Consideration |
| |
Average
Price Per Share |
| |||||||||||||||||||||
| | |
Number
|
| |
Percent
|
| |
Amount
|
| |
Percent
|
| ||||||||||||||||||
Existing stockholders
|
| | | | 5,666,667 | | | | | | 57.4% | | | | | $ | 1,114,029 | | | | | | 8.1% | | | | | $ | 0.20 | | |
New investors in this offering
|
| | | | 4,200,000 | | | | | | 42.6% | | | | | | 12,600,000 | | | | | | 91.9% | | | | | $ | 3.00 | | |
Total
|
| | | | 9,866,667 | | | | | | 100.0% | | | | | $ | 13,714,029 | | | | | | 100.0% | | | | | | | | |
| | |
Nine Months
Ended March 31, |
| |
Year Ended
June 30, |
| | ||||||||||||||||||||
| | |
2021
|
| |
2020
|
| |
2019
|
| |
2020
|
| | ||||||||||||||
| | |
(Unaudited)
|
| | | | | | | | | | | | | | | | |||||||||
Net sales
|
| | | $ | 5,076 | | | | | $ | 15,521 | | | | | $ | 20,812 | | | | | $ | 16,367 | | | | ||
Cost of sales
|
| | | | 3,786 | | | | | | 11,498 | | | | | | 15,575 | | | | | | 12,033 | | | | ||
Gross profit
|
| | | | 1,290 | | | | | | 4,023 | | | | | | 5,237 | | | | | | 4,334 | | | | ||
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Research and development
|
| | | | 103 | | | | | | 205 | | | | | | 318 | | | | | | 240 | | | | ||
Selling and marketing
|
| | | | 934 | | | | | | 1,986 | | | | | | 2,455 | | | | | | 2,295 | | | | ||
General and administrative
|
| | | | 1,206 | | | | | | 2,035 | | | | | | 2,503 | | | | | | 2,419 | | | | ||
Total expenses
|
| | | | 2,243 | | | | | | 4,226 | | | | | | 5,276 | | | | | | 4,954 | | | | ||
Operating loss
|
| | | | (953) | | | | | | (203) | | | | | | (39) | | | | | | (620) | | | | ||
Other expense (income) | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
Interest expense
|
| | | | 194 | | | | | | 183 | | | | | | — | | | | | | 263 | | | | ||
Interest and other income
|
| | | | — | | | | | | — | | | | | | (4) | | | | | | — | | | | ||
Total other expense (income)
|
| | | | 194 | | | | | | 183 | | | | | | (4) | | | | | | 263 | | | | ||
Net loss
|
| | | $ | (1,147) | | | | | $ | (386) | | | | | $ | (35) | | | | | $ | (883) | | | |
| | |
March 31,
2021 |
| |
June 30,
|
| ||||||||||||
| | |
2019
|
| |
2020
|
| ||||||||||||
| | |
(UNAUDITED)
|
| | | |||||||||||||
ASSETS
|
| | | | |||||||||||||||
Current Assets: | | | | | | | | | | | | | | | | | | | |
Cash
|
| | | $ | 1,097 | | | | | $ | 582 | | | | | $ | 1,058 | | |
Accounts receivable, net
|
| | | | 662 | | | | | | 2,128 | | | | | | 809 | | |
Inventories, net
|
| | | | 1,857 | | | | | | 1,683 | | | | | | 1,594 | | |
Prepaid expenses and other
|
| | | | 97 | | | | | | 99 | | | | | | 77 | | |
Total Current Assets
|
| | | | 3,713 | | | | | | 4,492 | | | | | | 3,538 | | |
Long-Term Assets: | | | | | | | | | | | | | | | | | | | |
Property, plant and equipment, net
|
| | | | 51 | | | | | | 32 | | | | | | 151 | | |
Intangibles, net
|
| | | | 959 | | | | | | — | | | | | | 1,030 | | |
Goodwill
|
| | | | 287 | | | | | | — | | | | | | 287 | | |
Other assets
|
| | | | 785 | | | | | | 188 | | | | | | 698 | | |
Total Long-Term Assets
|
| | | | 2,082 | | | | | | 220 | | | | | | 2,166 | | |
Total Assets
|
| | | $ | 5,795 | | | | | $ | 4,712 | | | | | $ | 5,704 | | |
LIABILITIES AND MEMBERS’ DEFICIT | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 2,383 | | | | | $ | 2,926 | | | | | $ | 2,694 | | |
Accrued liabilities
|
| | | | 376 | | | | | | 793 | | | | | | 454 | | |
Customer deposits
|
| | | | 558 | | | | | | 1,011 | | | | | | 828 | | |
Current portion – line of credit
|
| | | | 590 | | | | | | — | | | | | | 75 | | |
Current portion – notes payable
|
| | | | 686 | | | | | | — | | | | | | 444 | | |
Unearned warranty revenue
|
| | | | 5 | | | | | | 68 | | | | | | 26 | | |
Total Current Liabilities
|
| | | | 4,598 | | | | | | 4,798 | | | | | | 4,521 | | |
Long-Term Liabilities: | | | | | | | | | | | | | | | | | | | |
Notes payable, less current portion
|
| | | | 3,288 | | | | | | — | | | | | | 1,557 | | |
Line of credit, less current portion
|
| | | | — | | | | | | — | | | | | | 575 | | |
Deferred rent
|
| | | | 25 | | | | | | — | | | | | | 20 | | |
Total Long-Term Liabilities
|
| | | | 3,313 | | | | | | — | | | | | | 2,152 | | |
Members’ Deficit
|
| | | | (2,116) | | | | | | (86) | | | | | | (969) | | |
Total Liabilities and Members’ Deficit
|
| | | $ | 5,795 | | | | | $ | 4,712 | | | | | $ | 5,704 | | |
(in thousands)
|
| |
Historical
MiT |
| |
Pro Forma
Adjustments |
| |
Ref
|
| |
Pro Forma
Combined |
| |
Pro Forma
Post IPO |
| |||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash
|
| | | $ | 1,097 | | | | | $ | | | | | | | | | | | $ | 1,097 | | | | | $ | 11,748 | | | |
Accounts receivable
|
| | | | 662 | | | | | | | | | | | | | | | | | | 662 | | | | | | 662 | | |
Inventory
|
| | | | 1,857 | | | | | | | | | | | | | | | | | | 1,857 | | | | | | 1,857 | | |
Prepaid and other
|
| | | | 97 | | | | | | | | | | | | | | | | | | 97 | | | | | | 97 | | |
| | | | | 3,713 | | | | | | | | | | | | | | | | | | 3,713 | | | | | | 14,364 | | |
Intangibles, net
|
| | | | 959 | | | | | | | | | | | | | | | | | | 959 | | | | | | 959 | | |
Goodwill
|
| | | | 287 | | | | | | | | | | | | | | | | | | 287 | | | | | | 287 | | |
Property and equipment, net
|
| | | | 51 | | | | | | | | | | | | | | | | | | 51 | | | | | | 51 | | |
Deposits and other
|
| | | | 785 | | | | | | | | | | | | | | | | | | 785 | | | | | | 16 | | |
Total | | | | $ | 5,795 | | | | | $ | — | | | | | | | | | | | $ | 5,795 | | | | | $ | 15,677 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 2,383 | | | | | | | | | | | | | | | | | $ | 2,383 | | | | | $ | 2,383 | | |
Accrued expenses
|
| | | | 376 | | | | | | | | | | | | | | | | | | 376 | | | | | | 376 | | |
Customer deposits
|
| | | | 558 | | | | | | | | | | | | | | | | | | 558 | | | | | | 558 | | |
Current portion – line of credit
|
| | | | 590 | | | | | | | | | | | | | | | | | | 590 | | | | | | 590 | | |
Current portion – notes payable
|
| | | | 686 | | | | | | | | | | | | | | | | | | 686 | | | | | | 686 | | |
Deferred revenue
|
| | | | 5 | | | | | | | | | | | | | | | | | | 5 | | | | | | 5 | | |
| | | | | 4,598 | | | | | | — | | | | | | | | | | | | 4,598 | | | | | | 4,598 | | |
Deferred rent
|
| | | | 25 | | | | | | | | | | | | | | | | | | 25 | | | | | | 25 | | |
Notes payable, less current portion
|
| | | | 3,288 | | | | | | | | | | | | | | | | | | 3,288 | | | | | | 1,954 | | |
Members’/Shareholders’ equity (Deficit): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stock/APIC
|
| | | | | | | | | | (11,660) | | | | | | i | | | | | | (11,660) | | | | | | (445) | | |
Members’ equity
|
| | | | (11,660) | | | | | | 11,660 | | | | | | i | | | | | | | | | | | | | | |
Retained earnings (accumulated deficit)
|
| | | | 9,544 | | | | | | | | | | | | | | | | | | 9,544 | | | | | | 9,544 | | |
Common stock
|
| | | | | | | | | | | | | | | | | | | | | | — | | | | | | 1 | | |
| | | | | (2,116) | | | | | | | | | | | | | | | | | | (2,116) | | | | | | 9,100 | | |
Total | | | | $ | 5,795 | | | | | $ | — | | | | | | | | | | | $ | 5,795 | | | | | $ | 15,677 | | |
(in thousands, except share data and per share data)
|
| |
Historical
MiT |
| |
Caddy
July, 2019(1) |
| |
Pro Forma
Adjustments(2) |
| |
Pro Forma
Combined |
| ||||||||||||
Consolidated Statement of Operations Data: | | | | | | | | | | | | | | | | ||||||||||
Revenue | | | | $ | 16,367 | | | | | $ | 158 | | | | | $ | — | | | | | $ | 16,525 | | |
Cost of sales
|
| | | | 12,033 | | | | | | 106 | | | | | | 9 | | | | | | 12,148 | | |
Gross profit
|
| | | | 4,334 | | | | | | 52 | | | | | | (9) | | | | | | 4,377 | | |
Operating expenses: | | | | | | ||||||||||||||||||||
Selling, general and administrative
|
| | | | 4,954 | | | | | | 46 | | | | | | 8 | | | | | | 5,008 | | |
Total operating expenses
|
| | | | 4,954 | | | | | | 46 | | | | | | 8 | | | | | | 5,008 | | |
Other (income) expense: | | | | | | | | | | | | | | | | ||||||||||
Interest and other expense
|
| | | | 263 | | | | | | — | | | | | | 8 | | | | | | 271 | | |
Interest and other (income)
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total other (income) expense
|
| | | | 263 | | | | | | — | | | | | | 8 | | | | | | 271 | | |
Net Income (loss)
|
| | | $ | (883) | | | | | $ | 6 | | | | | $ | (25) | | | | | $ | (902) | | |
Historical net loss before income taxes
|
| | | $ | (883) | | | | | | | | | | | | | | | | | $ | (902) | | |
Pro forma benefit for income taxes
|
| | | | (247) | | | | | | | | | | | | | | | | | | (253) | | |
Pro forma net loss
|
| | | $ | (636) | | | | | | | | | | | | | | | | | $ | (649) | | |
Pro forma net loss per common share: basic and diluted
|
| | | $ | (.11) | | | | | | | | | | | | | | | | | $ | (.11) | | |
Pro forma shares outstanding: basic and diluted
|
| | | | 5,666,667 | | | | | | | | | | | | | | | | | | 5,666,667 | | |
|
Nine Months Ended March 31,
|
| ||||||
|
2021
|
| |
2020
|
| |||
|
(in 000’s)
|
| ||||||
|
Actual
|
| |
Actual
|
| |
Pro Forma
|
|
|
5,076
|
| |
15,521
|
| |
15,679
|
|
|
Nine Months Ended March 31,
|
| ||||||
|
2021
|
| |
2020
|
| |||
|
(in 000’s)
|
| ||||||
|
Actual
|
| |
Actual
|
| |
Pro Forma
|
|
|
1,290
|
| |
4,023
|
| |
4,066
|
|
|
Nine Months Ended March 31,
|
| ||||||
|
2021
|
| |
2020
|
| |||
|
(in 000’s)
|
| ||||||
|
Actual
|
| |
Actual
|
| |
Pro Forma
|
|
|
103
|
| |
205
|
| |
205
|
|
|
Nine Months Ended March 31,
|
| ||||||
|
2021
|
| |
2020
|
| |||
|
(in 000’s)
|
| ||||||
|
Actual
|
| |
Actual
|
| |
Pro Forma
|
|
|
2,140
|
| |
4,021
|
| |
4,075
|
|
|
Nine Months Ended March 31,
|
| ||||||
|
2021
|
| |
2020
|
| |||
|
(in 000’s)
|
| ||||||
|
Actual
|
| |
Actual
|
| |
Pro Forma
|
|
|
(194)
|
| |
(183)
|
| |
(191)
|
|
|
Nine Months Ended March 31,
|
| ||||||
|
2021
|
| |
2020
|
| |||
|
(in 000’s)
|
| ||||||
|
Actual
|
| |
Actual
|
| |
Pro Forma
|
|
|
(1,147)
|
| |
(386)
|
| |
(405)
|
|
|
Year Ended June 30,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||
|
(in 000’s)
|
| |||||||||
|
Actual
|
| |
Pro Forma
|
| |
Actual
|
| |
Pro Forma
|
|
|
$16,367
|
| |
$16,525
|
| |
$20,812
|
| |
$22,689
|
|
|
Year Ended June 30,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||
|
(in 000’s)
|
| |||||||||
|
Actual
|
| |
Pro Forma
|
| |
Actual
|
| |
Pro Forma
|
|
|
$4,334
|
| |
$4,377
|
| |
$5,237
|
| |
$5,754
|
|
|
Year Ended June 30,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||
|
(in 000’s)
|
| |||||||||
|
Actual
|
| |
Pro Forma
|
| |
Actual
|
| |
Pro Forma
|
|
|
$240
|
| |
$240
|
| |
$318
|
| |
$318
|
|
|
Year Ended June 30,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||
|
(in 000’s)
|
| |||||||||
|
Actual
|
| |
Pro Forma
|
| |
Actual
|
| |
Pro Forma
|
|
|
$4,714
|
| |
$4,768
|
| |
$4,958
|
| |
$5,693
|
|
|
Year Ended June 30,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||
|
(in 000’s)
|
| |||||||||
|
Actual
|
| |
Pro Forma
|
| |
Actual
|
| |
Pro Forma
|
|
|
$263
|
| |
$271
|
| |
$(4)
|
| |
$(137)
|
|
|
Year Ended June 30,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||
|
(in 000’s)
|
| |||||||||
|
Actual
|
| |
Pro Forma
|
| |
Actual
|
| |
Pro Forma
|
|
|
$(883)
|
| |
$(902)
|
| |
$(35)
|
| |
$(394)
|
|
Operating leases
|
| | | ||||
2021
|
| | | $ | 70 | | |
2022
|
| | | | 285 | | |
2023
|
| | | | 293 | | |
2024
|
| | | | 302 | | |
2025
|
| | | | 174 | | |
Total future lease payments
|
| | | $ | 1,124 | | |
Name
|
| |
Age
|
| |
Title
|
|
Executive Officers and Directors:
|
| | | | | | |
Phil Rafnson | | | 73 | | | President, Chief Executive Officer and Chairman of the Board | |
Jose Delgado | | | 57 | | | Executive Vice President, Sales and Marketing | |
Bevan Wright | | | 51 | | | Executive Vice President, Operations | |
Michael Sherman | | | 58 | | | Interim Chief Financial Officer(1) | |
Key Personnel: | | | | | | | |
Jerry Van de Rydt | | | 67 | | | Senior Vice President, FF& E Sales | |
David Richards | | | 64 | | | Senior Vice President, Engineering | |
Thomas Lipiec | | | 57 | | | Senior Vice President, Sales and Customer Service | |
Frank Tees | | | 46 | | | Vice President, Technical Sales & Support | |
Director Nominees | | | | | | | |
Katherine D. Crothall, Ph.D. | | | 71 | | | Director Nominee | |
John C. Stiska | | | 78 | | | Director Nominee | |
Scott Anderson | | | 66 | | | Director Nominee | |
Name and Principal Position
|
| |
Fiscal
Year |
| |
Salary
|
| |
Bonus
|
| |
Option
Awards |
| |
All Other
Compensation |
| |
Total
|
| ||||||||||||||||||
Glenn Sherman(1)
President and Chief Executive Officer |
| | | | 2020 | | | | | $ | 112,913 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 112,913 | | |
| | | 2019 | | | | | $ | 120,750 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 120,750 | | | ||
Jose Delgado
Executive Vice President, Sales and Marketing |
| | | | 2020 | | | | | $ | 195,058 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 195,058 | | |
| | | 2019 | | | | | $ | 220,500 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 220,500 | | | ||
Bevan Wright
Executive Vice President, Operations |
| | | | 2020 | | | | | $ | 195,058 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 195,058 | | |
| | | 2019 | | | | | $ | 220,500 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 220,500 | | | ||
Michael Sherman
Interim Chief Financial Officer(2) |
| | | | 2020 | | | | | $ | 178,000 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 178,000 | | |
| | | 2019 | | | | | $ | 208,000 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 208,000 | | |
| | |
Shares Beneficially
Owned Before this Offering |
| |
Shares Beneficially
Owned after this Offering |
| ||||||||||||||||||
Name of Beneficial Owner
|
| |
Number
|
| |
Percentage
|
| |
Number
|
| |
Percentage
|
| ||||||||||||
Named Executive Officers and directors: | | | | | | | | | | | | | | | | | | | | | | | | | |
Phil Rafnson(1)
|
| | | | 2,033,128 | | | | | | 35.8% | | | | | | 2,033,128 | | | | | | 20.6% | | |
Bevan Wright
|
| | | | 590,630 | | | | | | 10.4% | | | | | | 590,630 | | | | | | 6.0% | | |
Jose Delgado
|
| | | | 511,503 | | | | | | 9.0% | | | | | | 511,503 | | | | | | 5.2% | | |
Michael Sherman
|
| | | | — | | | | | | * | | | | | | — | | | | | | * | | |
Date
|
| |
Number of Shares
|
| |||
On the date of this Prospectus
|
| | | | 0 | | |
Between 90 and 180 days after the date of this Prospectus
|
| | | | 1,316,667 | | |
At various times beginning more than 180 days after the date of this Prospectus
|
| | | | 4,350,000 | | |
Underwriters
|
| |
Number of Shares
|
| |||
Boustead Securities, LLC.
|
| | | | 4,200,000 | | |
Total
|
| | | | 4,200,000 | | |
| | |
Per Share of
Common Stock |
| |
Total without Exercise of
Over-allotment option |
| ||||||
Public offering price
|
| | | $ | 3.00 | | | | | $ | 12,600,000 | | |
Underwriting discount(1)
|
| | | $ | 0.27 | | | | | $ | 1,134,000 | | |
Non-accountable expense allowance(2)
|
| | | $ | 0.06 | | | | | $ | 252,000 | | |
Net proceeds to us(3)
|
| | | $ | 2.67 | | | | | $ | 10,114,000 | | |
| | |
March 31,
2021 |
| |
June 30,
|
| ||||||||||||
| | |
2020
|
| |
2019
|
| ||||||||||||
| | |
(UNAUDITED)
|
| | | | | | | | | | | | | |||
Assets | | | | | | | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | | | | | | | |
Cash
|
| | | $ | 1,097 | | | | | $ | 1,058 | | | | | $ | 582 | | |
Accounts receivable, net
|
| | | | 662 | | | | | | 809 | | | | | | 2,128 | | |
Inventories, net
|
| | | | 1,857 | | | | | | 1,594 | | | | | | 1,683 | | |
Prepaid expenses and other
|
| | | | 97 | | | | | | 77 | | | | | | 99 | | |
Total Current Assets
|
| | | | 3,713 | | | | | | 3,538 | | | | | | 4,492 | | |
Long-Term Assets: | | | | | | | | | | | | | | | | | | | |
Property, plant and equipment, net
|
| | | | 51 | | | | | | 151 | | | | | | 32 | | |
Intangibles, net
|
| | | | 959 | | | | | | 1,030 | | | | | | — | | |
Goodwill
|
| | | | 287 | | | | | | 287 | | | | | | — | | |
Other assets
|
| | | | 785 | | | | | | 698 | | | | | | 188 | | |
Total Long-Term Assets
|
| | | | 2,082 | | | | | | 2,166 | | | | | | 220 | | |
Total Assets
|
| | | $ | 5,795 | | | | | $ | 5,704 | | | | | $ | 4,712 | | |
Liabilities And Members’ Deficit | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | |
Accounts payable
|
| | | $ | 2,383 | | | | | $ | 2,694 | | | | | $ | 2,926 | | |
Accrued expenses
|
| | | | 376 | | | | | | 454 | | | | | | 793 | | |
Customer deposits
|
| | | | 558 | | | | | | 828 | | | | | | 1,011 | | |
Line of credit
|
| | | | 590 | | | | | | 75 | | | | | | — | | |
Notes payable – current
|
| | | | 686 | | | | | | 444 | | | | | | — | | |
Unearned warranty revenue
|
| | | | 5 | | | | | | 26 | | | | | | 68 | | |
Total Current Liabilities
|
| | | | 4,598 | | | | | | 4,521 | | | | | | 4,798 | | |
Long-Term Liabilities: | | | | | | | | | | | | | | | | | | | |
Notes payable, net of current portion
|
| | | | 3,288 | | | | | | 1,557 | | | | | | — | | |
Line of credit, net of current portion.
|
| | | | — | | | | | | 575 | | | | | | — | | |
Deferred rent
|
| | | | 25 | | | | | | 20 | | | | | | — | | |
Total Long-Term Liabilities
|
| | | | 3,313 | | | | | | 2,152 | | | | | | — | | |
Total Liabilities
|
| | | | 7,911 | | | | | | 6,673 | | | | | | — | | |
Members’ Def icit
|
| | | | (2,116) | | | | | | (969) | | | | | | (86) | | |
Total Liabilities and Members’ Deficit
|
| | | $ | 5,795 | | | | | $ | 5,704 | | | | | $ | 4,712 | | |
| | |
Nine Months
Ended March 31, 2021 |
| |
Nine Months
Ended March 31, 2020 |
| |
Year Ended
June 30, 2020 |
| |
Year Ended
June 30, 2019 |
| ||||||||||||
| | |
(Unaudited)
|
| |
(Unaudited)
|
| | | | | | | | | | | | | ||||||
Net sales
|
| | | $ | 5,076 | | | | | $ | 15,521 | | | | | $ | 16,367 | | | | | $ | 20,812 | | |
Cost of goods sold
|
| | | | 3,786 | | | | | | 11,498 | | | | | | 12,033 | | | | | | 15,575 | | |
Gross profit
|
| | | | 1,290 | | | | | | 4,023 | | | | | | 4,334 | | | | | | 5,237 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | |
Research and development
|
| | | | 103 | | | | | | 205 | | | | | | 240 | | | | | | 318 | | |
Selling and marketing
|
| | | | 934 | | | | | | 1,986 | | | | | | 2,295 | | | | | | 2,455 | | |
General and administrative
|
| | | | 1,206 | | | | | | 2,035 | | | | | | 2,419 | | | | | | 2,503 | | |
Total operating expenses
|
| | | | 2,243 | | | | | | 4,226 | | | | | | 4,954 | | | | | | 5,276 | | |
Operating (loss)
|
| | | | (953) | | | | | | (203) | | | | | | (620) | | | | | | (39) | | |
Other expenses (income) | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest and other income
|
| | | | — | | | | | | — | | | | | | — | | | | | | (4) | | |
Interest expense
|
| | | | 194 | | | | | | 183 | | | | | | 263 | | | | | | — | | |
Total other expense (income)
|
| | | | 194 | | | | | | 183 | | | | | | 263 | | | | | | (4) | | |
Net (loss)
|
| | | $ | (1,147) | | | | | $ | (386) | | | | | $ | (883) | | | | | $ | (35) | | |
Pro Forma C-Corporation Information (Unaudited) –
See Note 11 |
| | | | | | | | | | | | | | | | | | | | | | | | |
Historical net loss before income taxes
|
| | | $ | (1,147) | | | | | $ | (386) | | | | | $ | (883) | | | | | $ | (35) | | |
Pro forma benefit for income taxes
|
| | | | (321) | | | | | | (108) | | | | | | (247) | | | | | | (10) | | |
Pro forma net loss
|
| | | $ | (826) | | | | | $ | (278) | | | | | $ | (636) | | | | | $ | (25) | | |
Pro forma net loss per common share basic
|
| | | $ | (.15) | | | | | $ | (.05) | | | | | $ | (.11) | | | | | $ | (.01) | | |
Pro forma shares outstanding: basic
|
| | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | |
Pro forma net loss per common share diluted
|
| | | $ | (.15) | | | | | $ | (.05) | | | | | $ | (.11) | | | | | $ | (.01) | | |
Pro forma shares outstanding: diluted
|
| | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | | | | | 5,666,667 | | |
|
Balance June 30, 2018
|
| | | $ | 126 | | |
|
Distributions
|
| | | | (177) | | |
|
Net loss
|
| | | | (35) | | |
|
Balance June 30, 2019
|
| | | | (86) | | |
|
Net loss
|
| | | | (883) | | |
|
Balance June 30, 2020
|
| | | | (969) | | |
|
Net loss (Unaudited)
|
| | | | (1,147) | | |
|
Balance March 31, 2021 (Unaudited)
|
| | | $ | (2,116) | | |
| | |
Nine Months
Ended March 31, 2021 |
| |
Nine Months
Ended March 31, 2020 |
| |
Year Ended
June 30, 2020 |
| |
Year Ended
June 30, 2019 |
| ||||||||||||
| | |
(Unaudited)
|
| |
(Unaudited)
|
| | | | | | | | | | | | | ||||||
Cash flows from operating activities | | | | | | | | | | | | | | | | | | | | | | | | | |
Net loss
|
| | | $ | (1,147) | | | | | $ | (386) | | | | | $ | (883) | | | | | $ | (35) | | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Change in fair value of contingent consideration
|
| | | | — | | | | | | (150) | | | | | | (150) | | | | | | — | | |
Provision for (reversal of) doubtful accounts
|
| | | | 8 | | | | | | 73 | | | | | | 80 | | | | | | (105) | | |
Depreciation expense
|
| | | | 99 | | | | | | 93 | | | | | | 126 | | | | | | 17 | | |
Amortization expense
|
| | | | 72 | | | | | | 64 | | | | | | 88 | | | | | | — | | |
Deferred rent
|
| | | | 5 | | | | | | 11 | | | | | | 13 | | | | | | 7 | | |
Changes in operating assets and liabilities, net of acquisitions:
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Accounts receivable
|
| | | | 139 | | | | | | 1,164 | | | | | | 1,478 | | | | | | 158 | | |
Inventories
|
| | | | (263) | | | | | | 17 | | | | | | 89 | | | | | | 516 | | |
Prepaid expenses and other
|
| | | | (107) | | | | | | (352) | | | | | | 220 | | | | | | (198) | | |
Accounts payable
|
| | | | (311) | | | | | | (239) | | | | | | (352) | | | | | | (755) | | |
Accrued expenses
|
| | | | (78) | | | | | | (372) | | | | | | (1,060) | | | | | | 97 | | |
Unearned warranty revenue
|
| | | | (21) | | | | | | (20) | | | | | | (42) | | | | | | 24 | | |
Customer deposits
|
| | | | (270) | | | | | | (484) | | | | | | (183) | | | | | | 172 | | |
Net cash used in operating activities
|
| | | | (1,874) | | | | | | (581) | | | | | | (576) | | | | | | (102) | | |
Cash flows from investing activities | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash acquired in business combination
|
| | | | — | | | | | | 128 | | | | | | 128 | | | | | | — | | |
Due from related party
|
| | | | — | | | | | | — | | | | | | — | | | | | | 167 | | |
Purchases of property, plant and equipment
|
| | | | — | | | | | | (2) | | | | | | (2) | | | | | | (3) | | |
Net cash provided by investing activities
|
| | | | — | | | | | | 126 | | | | | | 126 | | | | | | 164 | | |
Cash flows from financing activities | | | | | | | | | | | | | | | | | | | | | | | | | |
Net change in notes payable
|
| | | | (59) | | | | | | (446) | | | | | | (418) | | | | | | — | | |
Net borrowings (payments) on line of credit
|
| | | | (60) | | | | | | 650 | | | | | | 650 | | | | | | — | | |
Proceeds from notes payable
|
| | | | 1,334 | | | | | | — | | | | | | — | | | | | | — | | |
Paycheck Protection Program Loan proceeds
|
| | | | 698 | | | | | | — | | | | | | 694 | | | | | | — | | |
Member distributions
|
| | | | — | | | | | | — | | | | | | — | | | | | | (77) | | |
Net cash provided by (used in) financing activities
|
| | | | 1,913 | | | | | | 204 | | | | | | 926 | | | | | | (77) | | |
Net increase (decrease) in cash
|
| | | | 39 | | | | | | (251) | | | | | | 476 | | | | | | (15) | | |
Cash, beginning of the period
|
| | | | 1,058 | | | | | | 582 | | | | | | 582 | | | | | | 597 | | |
Cash, end of the period
|
| | | $ | 1,097 | | | | | $ | 331 | | | | | $ | 1,058 | | | | | $ | 582 | | |
Non-cash investing and financing activities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Distribution to member to settle related party receivable.
|
| | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 100 | | |
Deferred IPO costs
|
| | | $ | 72 | | | | | $ | 262 | | | | | $ | 263 | | | | | $ | — | | |
Acquisition of certain Caddy net assets by issuing notes payable
|
| | | $ | — | | | | | $ | 1,905 | | | | | $ | 1,905 | | | | | $ | — | | |
Cash paid during the period: | | | | | | | | | | | | | | | | | | | | | |||||
Interest
|
| | | $ | 165 | | | | | $ | 183 | | | | | $ | 263 | | | | | $ | — | | |
| | | | |
For the year ended
June 30, 2020 |
| |||||||||||||
| | |
March 31, 2021
|
| |
March 31, 2020
|
| ||||||||||||
| | |
(Unaudited)
|
| | | | | | | |||||||||
Products (point in time)
|
| | | $ | 4,984 | | | | | $ | 14,919 | | | | | $ | 15,752 | | |
Software and services (over time)
|
| | | | 92 | | | | | | 602 | | | | | | 615 | | |
Total revenues
|
| | | $ | 5,076 | | | | | $ | 15,521 | | | | | $ | 16,367 | | |
| | |
March 31,
2020 |
| |
June 30,
|
| ||||||||||||
| | |
2020
|
| |
2019
|
| ||||||||||||
| | |
(UNAUDITED)
|
| | | | | | | | | | | | | |||
Product warranty liability beginning of period
|
| | | $ | 65 | | | | | $ | 111 | | | | | $ | 118 | | |
Accruals for warranties issued
|
| | | | 24 | | | | | | 18 | | | | | | 105 | | |
Change in estimates
|
| | | | (42) | | | | | | — | | | | | | — | | |
Settlements made
|
| | | | (23) | | | | | | (64) | | | | | | (112) | | |
Product warranty liability end of the period
|
| | | $ | 24 | | | | | $ | 65 | | | | | $ | 111 | | |
| | |
March 31,
2021 |
| |
June 30,
2019
|
| |
June 30,
2020 |
| |||||||||
| | |
(Unaudited)
|
| | | | | | | | | | | | | |||
Production equipment
|
| | | $ | 307 | | | | | $ | 307 | | | | | $ | 66 | | |
Leasehold improvements
|
| | | | 202 | | | | | | 202 | | | | | | 202 | | |
Furniture and fixtures
|
| | | | 45 | | | | | | 45 | | | | | | 45 | | |
Computer equipment
|
| | | | 42 | | | | | | 42 | | | | | | 39 | | |
Other equipment
|
| | | | 114 | | | | | | 114 | | | | | | 114 | | |
| | | | | 710 | | | | | | 710 | | | | | | 466 | | |
Accumulated depreciation
|
| | | | 659 | | | | | | 559 | | | | | | 434 | | |
Net property plant and equipment
|
| | | $ | 51 | | | | | $ | 151 | | | | | $ | 32 | | |
| | |
Useful Lives
|
|
Leasehold improvements | | | 5 years or. remaining lease term | |
Furniture and fixtures | | | 5 years | |
Production equipment | | | 3 – 7 years | |
Computer equipment | | | 3 years | |
Other equipment | | | 3 – 7 years | |
| | | | | |
(UNAUDITED)
|
| |||||||||||||||
| | |
Amortization
Period |
| |
Gross Asset
Cost |
| |
Amortization
Accumulated |
| |
Net Book
Value |
| |||||||||
Customer relations
|
| |
11 years
|
| | | $ | 970 | | | | | $ | 147 | | | | | $ | 823 | | |
Patents
|
| |
20 years
|
| | | | 70 | | | | | | 6 | | | | | | 64 | | |
Trademark
|
| |
20 years
|
| | | | 78 | | | | | | 6 | | | | | | 72 | | |
| | | | | | | $ | 1,118 | | | | | $ | 159 | | | | | $ | 959 | | |
| | |
Amortization
Period |
| |
Gross Asset
Cost |
| |
Accumulated
Amortization |
| |
Net Book
Value |
| |||||||||
Customer relations
|
| |
11 years
|
| | | $ | 970 | | | | | $ | 81 | | | | | $ | 889 | | |
Patents
|
| |
20 years
|
| | | | 70 | | | | | | 3 | | | | | | 67 | | |
Trademark
|
| |
20 years
|
| | | | 78 | | | | | | 4 | | | | | | 74 | | |
| | | | | | | $ | 1,118 | | | | | $ | 88 | | | | | $ | 1,030 | | |
|
Goodwill – June 30, 2019
|
| | |
$
|
—
|
| |
|
Caddy acquisition
|
| | | | 287 | | |
|
Goodwill – June 30, 2020
|
| | | | 287 | | |
|
Goodwill – March 31, 2021 ((Unaudited))
|
| | |
$
|
287
|
| |
|
2021remaining
|
| | | $ | 24 | | |
|
2022
|
| | | | 96 | | |
|
2023
|
| | | | 96 | | |
|
2024
|
| | | | 96 | | |
|
2025
|
| | | | 96 | | |
|
2026 and beyond
|
| | | | 551 | | |
|
Total
|
| | | $ | 959 | | |
| | |
March 31,
2021 |
| |
June 30,
|
| ||||||||||||
| | |
2020
|
| |
2019
|
| ||||||||||||
| | |
(UNAUDITED)
|
| | | | | | | | | | | | | |||
Employee compensation
|
| | | $ | 200 | | | | | $ | 168 | | | | | $ | 230 | | |
Others
|
| | | | 176 | | | | | | 286 | | | | | | 563 | | |
Total
|
| | | $ | 376 | | | | | $ | 454 | | | | | $ | 793 | | |
| | |
March 31, 2021
|
| |
June 30, 2020
|
| | | | ||||||
| | |
(UNAUDITED)
|
| | | | | | | | | | |||
Promissory note
|
| | | $ | 1,066 | | | | | $ | 1,117 | | | | ||
Payroll Protection Program (see COVID-19 Impact and Liquidity footnote)
|
| | | | 1,392 | | | | | | 694 | | | | ||
MITQ loan (see COVID-19 Impact and Liquidity footnote)
|
| | | | 1,334 | | | | | | — | | | | ||
Indemnity promissory note
|
| | | | 182 | | | | | | 190 | | | | ||
Total debt obligations
|
| | | | 3,974 | | | | | | 2,001 | | | | ||
Less current portion
|
| | | | (686) | | | | | | (444) | | | | ||
Long-term debt less current portion
|
| | | $ | 3,288 | | | | | $ | 1,557 | | | |
| | |
(in thousands)
Total Payments |
| |||
2021 Remaining
|
| | | $ | 70 | | |
2022
|
| | | | 285 | | |
2023
|
| | | | 293 | | |
2024
|
| | | | 302 | | |
2025
|
| | | | 174 | | |
Total future minimum lease payments
|
| | | $ | 1,124 | | |
| | |
(in thousands)
|
| |||
Notes issued for the acquisition
|
| | | $ | 1,905 | | |
Liabilities assumed
|
| | | | 108 | | |
| | | | $ | 2,013 | | |
|
Cash
|
| | | $ | 128 | | |
|
Accounts receivable and other assets
|
| | | | 239 | | |
|
Property plant and equipment, net
|
| | | | 241 | | |
|
Customer relationships
|
| | | | 970 | | |
|
Patents
|
| | | | 70 | | |
|
Trademark
|
| | | | 78 | | |
|
Total identifiable assets acquired
|
| | | | 1,726 | | |
|
Goodwill
|
| | | | 287 | | |
|
Net assets acquired
|
| | | $ | 2,013 | | |
| | |
Year ended June 30,
|
| |||||||||
| | |
2020
|
| |
2019
|
| ||||||
Revenue
|
| | | $ | 16,525 | | | | | $ | 22,689 | | |
Net loss
|
| | | $ | (902) | | | | | $ | (394) | | |
| | |
June 30, 2020
|
| |||||||||||||||
| | |
Fair Value Hierarchy Category
|
| |||||||||||||||
(in thousands)
|
| |
Level 1
|
| |
Level 2
|
| |
Level 3
|
| |||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | |
Contingent consideration – business combinations
|
| | | $ | — | | | | | $ | — | | | | | $ | — | | |
Total Liabilities
|
| | | $ | — | | | | | $ | — | | | | | $ | — | | |
(in thousands)
|
| |
Year Ended
June 30, 2020 |
| |||
Fair value measurement at beginning of period
|
| | | $ | — | | |
Contingent consideration liabilities recorded for business combinations, including measurement period adjustments
|
| | | | 150 | | |
Changes in fair values, recorded in operating expenses
|
| | | | (150) | | |
Payments of contingent consideration
|
| | | | — | | |
Fair value measurement at end of period
|
| | | $ | — | | |
| | |
June 30,
2019 |
| |
December 31,
|
| ||||||||||||
| | |
2018
|
| |
2017
|
| ||||||||||||
| | |
(UNAUDITED)
|
| | | |||||||||||||
ASSETS | | | | | |||||||||||||||
Current assets | | | | | |||||||||||||||
Cash
|
| | | $ | 99 | | | | | $ | 54 | | | | | $ | 16 | | |
Other assets
|
| | | | 90 | | | | | | 11 | | | | | | — | | |
Accounts receivable
|
| | | | 207 | | | | | | 133 | | | | | | 149 | | |
Total current assets
|
| | | | 396 | | | | | | 198 | | | | | | 165 | | |
Property, plant and equipment, net
|
| | | | 63 | | | | | | 106 | | | | | | 213 | | |
Total assets
|
| | | $ | 459 | | | | | $ | 304 | | | | | $ | 378 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | |||||||||||||||
Current liabilities | | | | | |||||||||||||||
Accounts payable
|
| | | $ | 106 | | | | | $ | 39 | | | | | $ | 12 | | |
Accrued expenses
|
| | | | 2 | | | | | | 11 | | | | | | 28 | | |
Line of credit
|
| | | | — | | | | | | — | | | | | | 50 | | |
Total current liabilities
|
| | | | 108 | | | | | | 50 | | | | | | 90 | | |
Related party note payable
|
| | | | — | | | | | | — | | | | | | 20 | | |
Common stock – no par value, 1,000 shares outstanding at December 31, 2017 and 2018, and June 30, 2019
|
| | | | — | | | | | | — | | | | | | — | | |
Retained earnings
|
| | | | 351 | | | | | | 254 | | | | | | 268 | | |
Stockholders’ equity
|
| | | | 351 | | | | | | 254 | | | | | | 268 | | |
Total liabilities and stockholders’ equity
|
| | | $ | 459 | | | | | $ | 304 | | | | | $ | 378 | | |
| | |
Six Months
Ended June 30, 2019 |
| |
Six Months
Ended June 30, 2018 |
| |
Year Ended
December 31, 2018 |
| |
Year Ended
December 31, 2017 |
| ||||||||||||
| | |
(UNAUDITED)
|
| |
(UNAUDITED)
|
| | | ||||||||||||||||
Net sales
|
| | | $ | 1,002 | | | | | $ | 1,017 | | | | | $ | 1,892 | | | | | $ | 2,259 | | |
Cost of goods sold
|
| | | | 654 | | | | | | 590 | | | | | | 1,176 | | | | | | 1,352 | | |
Gross profit
|
| | | | 348 | | | | | | 427 | | | | | | 716 | | | | | | 907 | | |
Operating expenses | | | | | | ||||||||||||||||||||
Selling, general and administrative
|
| | | | 254 | | | | | | 286 | | | | | | 683 | | | | | | 886 | | |
Total operating expenses
|
| | | | 254 | | | | | | 286 | | | | | | 683 | | | | | | 886 | | |
Operating profit
|
| | | | 94 | | | | | | 141 | | | | | | 33 | | | | | | 21 | | |
Other expense (income)
|
| | | | | ||||||||||||||||||||
Interest expense
|
| | | | — | | | | | | 1 | | | | | | 1 | | | | | | — | | |
Interest and other (income)
|
| | | | (3) | | | | | | (9) | | | | | | 20 | | | | | | (22) | | |
Total other expense (income)
|
| | | | (3) | | | | | | (8) | | | | | | 21 | | | | | | (22) | | |
Net income
|
| | | $ | 97 | | | | | $ | 149 | | | | | $ | 12 | | | | | $ | 43 | | |
|
Balance December 31, 2016
|
| | | $ | 258 | | |
|
Distributions
|
| | | | (33) | | |
|
Net income
|
| | | | 43 | | |
|
Balance December 31, 2017
|
| | | | 268 | | |
|
Distributions
|
| | | | (26) | | |
|
Net income
|
| | | | 12 | | |
|
Balance December 31, 2018
|
| | | | 254 | | |
|
Distributions (UNAUDITED)
|
| | | | — | | |
|
Net income (UNAUDITED)
|
| | | | 97 | | |
|
Balance June 30, 2019 (UNAUDITED)
|
| | | $ | 351 | | |
| | |
Six Months
Ended June 30, 2019 |
| |
Six Months
Ended June 30, 2018 |
| |
Year Ended
December 31, 2018 |
| |
Year Ended
December 31, 2017 |
| ||||||||||||
| | |
(UNAUDITED)
|
| |
(UNAUDITED)
|
| | | ||||||||||||||||
Cash flows from operating activities | | | | | | ||||||||||||||||||||
Net income
|
| | | $ | 97 | | | | | $ | 149 | | | | | $ | 12 | | | | | $ | 43 | | |
Adjustments to reconcile net income to net cash provided by operating activities:
|
| | | | | ||||||||||||||||||||
Depreciation expense
|
| | | | 43 | | | | | | 75 | | | | | | 119 | | | | | | 146 | | |
Changes in operating assets and liabilities: | | | | | | ||||||||||||||||||||
Accounts receivable
|
| | | | (74) | | | | | | 10 | | | | | | 17 | | | | | | 49 | | |
Other assets
|
| | | | (79) | | | | | | — | | | | | | (11) | | | | | | — | | |
Accounts payable
|
| | | | 67 | | | | | | 65 | | | | | | 27 | | | | | | (42) | | |
Accrued expenses
|
| | | | (9) | | | | | | (27) | | | | | | (19) | | | | | | (13) | | |
Net cash provided by operating activities
|
| | | | 45 | | | | | | 272 | | | | | | 145 | | | | | | 183 | | |
Cash flows from investing activities | | | | | | ||||||||||||||||||||
Purchases of property, plant and equipment
|
| | | | — | | | | | | (11) | | | | | | (11) | | | | | | (87) | | |
Net cash used in investing activities
|
| | | | — | | | | | | (11) | | | | | | (11) | | | | | | (87) | | |
Cash flows from financing activities | | | | | | ||||||||||||||||||||
Due from related party
|
| | | | — | | | | | | — | | | | | | (20) | | | | | | — | | |
Payments of related party notes payable
|
| | | | — | | | | | | — | | | | | | — | | | | | | 8 | | |
Line of credit
|
| | | | — | | | | | | (50) | | | | | | (50) | | | | | | (55) | | |
Stockholder distributions
|
| | | | — | | | | | | (40) | | | | | | (26) | | | | | | (33) | | |
Net cash used in financing activities
|
| | | | — | | | | | | (90) | | | | | | (96) | | | | | | (80) | | |
Net increase in cash
|
| | | | 45 | | | | | | 171 | | | | | | 38 | | | | | | 16 | | |
Cash, beginning of the period
|
| | | | 54 | | | | | | 16 | | | | | | 16 | | | | | | — | | |
Cash, end of the period
|
| | | $ | 99 | | | | | $ | 187 | | | | | $ | 54 | | | | | $ | 16 | | |
Supplemental disclosure of cash flow information | | | | | | ||||||||||||||||||||
Cash paid during the year and for the period: | | | | | | ||||||||||||||||||||
Interest
|
| | | $ | — | | | | | $ | — | | | | | $ | 1 | | | | | $ | 6 | | |
| | |
December 31,
|
| |||||||||
| | |
2018
|
| |
2017
|
| ||||||
Molds
|
| | | $ | 3,047 | | | | | $ | 3,034 | | |
Furniture and fixtures
|
| | | | 163 | | | | | | 163 | | |
Leasehold improvements
|
| | | | 82 | | | | | | 82 | | |
Computer equipment
|
| | | | 126 | | | | | | 126 | | |
Other equipment
|
| | | | 67 | | | | | | 67 | | |
| | | | | 3,485 | | | | | | 3,472 | | |
Accumulated depreciation
|
| | | | 3,379 | | | | | | 3,259 | | |
Net property and equipment
|
| | | $ | 106 | | | | | $ | 213 | | |
| | |
Useful Lives
|
|
Leasehold improvements | | | 5 years | |
Furniture and fixtures | | | 5 years | |
Molds | | | 3 years | |
Computer equipment | | | 3 years | |
Other equipment | | | 3 — 7 years | |
|
January 1, 2016 through July 31, 2017
|
| | | $ | 4,581 | | |
|
August 1, 2017 through November 15, 2018
|
| | | $ | 5,377 | | |