Acquisition of SWIMS (Tables)

12 Months Ended

Dec. 31, 2016

Acquisition of SWIMS

Schedule of preliminary estimated purchase price allocation

The following is the total purchase price allocation as of December 31, 2016 (in thousands, except share and per share data):

	Preliminary Purchase		Measurement Period		Final Purchase
	Price Allocation		Adjustments (1)		Price Allocation
Assets acquired and liabilities assumed:
Cash and cash equivalents	$	189	$	—	$	189
Factored accounts receivable		1,552		—		1,552
Inventories		3,466		—		3,466
Prepaid expenses and other assets		647		—		647
Property and equipment		498		—		498
Accounts payable and accrued expenses		(1,706)		—		(1,706)
Deferred income tax liability		(1,995)		(481)		(2,476)
Intangible assets acquired:
Trade name		5,062		2,224		7,286
Customer relationships		1,964		(131)		1,833
Non-compete agreements		142		(12)		130
Total		9,819		1,600		11,419
Excess purchase price over net assets acquired		3,993		(1,600)		2,393
Total net assets acquired	$	13,812	$	—	$	13,812
Total purchase price:
Cash paid to sellers	$	12,017	$	—	$	12,017
Equity consideration issued to sellers
(702,943 common shares at $2.49)		1,750		—		1,750
Fair value of warrants issued to sellers		45		—		45
Total purchase price	$	13,812	$	—	$	13,812

(1) The measurement period adjustments were due to the finalization of the valuation related to intangible assets and resulted in the following: an increase to tradename, a decrease to customer relationships and non-compete agreements, with the related increase in long-term deferred tax liabilities and corresponding decrease to goodwill. The measurement period adjustments did not have a significant impact on the Company’s consolidated statement of operations and comprehensive (loss) income for the year ended December 31, 2016.

Schedule of unaudited pro forma results

	Year ended December 31,
	2016		2015
Net sales	$	159,581	$	156,143
Net loss	$	(6,000)	$	(14,538)
Weighted average common shares outstanding		12,428		12,273
Loss per common share - basic and diluted	$	(0.48)	$	(1.18)