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ASSETS HELD FOR SALE AND PROPERTY AND EQUIPMENT | 3 Months Ended
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Mar. 31, 2023
Property, Plant and Equipment [Abstract] |
ASSETS HELD FOR SALE AND PROPERTY AND EQUIPMENT | ASSETS HELD FOR SALE AND PROPERTY AND EQUIPMENT
(In thousands) | March 31, 2023 (Unaudited) |  | December 31, 2022
Land | $ | — |  |  | $ | 1,600 |
Building and improvements | 16 |  |  | 4,426 |
Machinery and equipment | 2,472 |  |  | 2,613 |
Furniture and fixtures | 213 |  |  | 211 |
Computer equipment and software | 1,230 |  |  | 1,420 |
Leasehold improvements | 178 |  |  | 178 |
Molds | 847 |  |  | 847 |
Total property, plant and equipment | 4,956 |  |  | 11,295 |
Less: accumulated depreciation and amortization | (3,387) |  |  | (5,041) |
Property and equipment in service | 1,569 |  |  | 6,254 |
Construction in progress | 540 |  |  | 507 |
Property and equipment, net | $ | 2,109 |  |  | $ | 6,761 |
Assets held for sale | $ | 4,569 |  |  | $ | — |
In an effort to improve liquidity and the balance sheet condition of the Company, management has been exploring options to leverage the Company’s unencumbered real property. On February 27, 2023, the Company’s Board of Directors approved a plan to sell and leaseback the Company's real property located in Clearwater, FL. On March 14, 2023, the Company entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with VK Acquisitions VI, LLC (the “Purchaser”), for the sale of the Company’s facility located at 5115 Ulmerton Road, Clearwater, Florida, as more fully described in the Purchase Agreement (collectively, the “Property”) for a purchase price of $7,650,000. In accordance with the requirements of ASC Topic 360, Property, Plant, and Equipment, the Company has determined that the real property to be sold meets the requirements to be presented as held for sale. Accordingly, the Company has presented the associated assets as held for sale in the accompanying unaudited condensed consolidated balance sheet and the table above at March 31, 2023. In accordance with the terms of the Purchase Agreement, upon the closing of the sale of the Property, the Company will enter into a Single Tenant Industrial Building Lease (the “Lease”) with the Purchaser, pursuant to which the Property will be leased back to the Company. The Lease will have an initial term of ten (10) years commencing from the closing (the “Initial Term”), and a renewal term of five (5) years, exercisable at the Company’s option. The annual fixed rent will be $619,500 for the first year of the Initial Term, and will be subject to a 4% escalation every year thereafter through the Initial Term. Rent will be reset to the current market rate should the Company exercise the renewal option. The Lease provides for a 3% management fee on rent payments throughout the Initial Term and optional renewal term. The Lease is a triple net lease, pursuant to which all costs, expenses, and obligations relating to the Property, including, repair and maintenance charges, utility charges, real estate taxes or other taxes that may be imposed that relate to the Property, shall be paid by the Company. In addition, the Lease contains other customary terms and provisions generally contained within leases of this type. On May 8, 2023, the Company closed on the Purchase Agreement and concurrently executed a 10-year agreement to leaseback the underlying Property from the Purchaser. The Company received net cash proceeds of approximately $6,600,000, after withholding the security deposit equal to one years rent, taxes, first months rent, expenses, and fees. The Company anticipates that the net cash proceeds will be used to strengthen its balance sheet and provide working capital to its operations.

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- Definition The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 958 -SubTopic 360 -Section 50 -Paragraph 6 -URI https://asc.fasb.org/extlink&oid=126982197&loc=d3e99893-112916 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI https://asc.fasb.org/topic&trid=2155823 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 958 -SubTopic 360 -Section 50 -Paragraph 7 -URI https://asc.fasb.org/extlink&oid=126982197&loc=SL120174063-112916 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 958 -SubTopic 360 -Section 50 -Paragraph 1 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126982197&loc=d3e99779-112916 + Details
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