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Note 5 - Subordinated Notes Receivable
12 Months Ended
Dec. 31, 2023
Notes to Financial Statements  
Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

5.         Subordinated Notes Receivable

 

On March 2, 2018, the Company sold substantially all of its assets (the “Asset Sale”) to Stanley Furniture Company LLC, formerly known as Churchill Downs LLC (the “Buyer”). The Company was issued a subordinated secured promissory note in the principal amount of $7.4 million (the "Original Note") from the Buyer as partial consideration for the Asset Sale during the first quarter of 2018. On September 6, 2018, the Buyer sold certain of its assets, including certain inventory and the Stone & Leigh tradename to Stone & Leigh, LLC ("S&L" and such asset sale, the "S&L Asset Sale"), which is owned by a group which includes Matthew W. Smith, the Company’s former interim Chief Executive Officer. As a part of the S&L Asset Sale, the Buyer assigned to S&L certain of its rights and obligations under the Original Note. In connection with the assignment, the Company entered into an amended and restated subordinated secured promissory note in the principal amount of $3.3 million as of the assignment date ("A&R Note") and a new subordinated secured promissory note with S&L in the principal amount of $4.4 million as of the assignment date (the "S&L Note"). 

 

The A&R Note was fully repaid during the year ended December 31, 2020. 

 

The S&L Note was fully impaired as of December 31, 2022. The Company recognized a final other than temporary impairment loss of $992,000 on the S&L Note during the year ended December 31, 2022. The S&L Note matured on March 2, 2023, at which time the total principal amount became due. No interest payments or principal payments were accrued or received during the years ended December 31, 2023 and 2022