4Licensing Corp

CIK:0000058592|SEC Filings

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Net revenues:
Service revenue	$ 27	$ 162	$ 205	$ 645
Product revenue	62	17	192	328
Total net revenues	89	179	397	973
Costs and expenses:
Selling, general and administrative	986	893	2,869	3,365
Cost of product sales	23	8	224	185
Total costs and expenses	1,009	901	3,093	3,550
Loss from operations	(920)	(722)	(2,696)	(2,577)
Other income (expense):
Change in fair value of derivative warrant liability	508	0	1,124	0
Gain on settlement of claims	0	0	0	1,607
Gain on sale of assets	0	27	0	270
Interest expense	(176)	(111)	(1,570)	(214)
Stock issuance cost	0	0	(840)	0
Total other income (expense)	332	(84)	(1,286)	1,663
Loss from continuing operations before reorganization items	(588)	(806)	(3,982)	(914)
Reorganization items	0	(9)	0	(42)
Loss from continuing operations	(588)	(815)	(3,982)	(956)
Income from discontinued operations	22	60	31	385
Net loss	(566)	(755)	(3,951)	(571)
Loss attributable to noncontrolling interests, continuing operations	126	177	423	535
Net income (loss) attributable to 4Licensing Corporation	$ (440)	$ (578)	$ (3,528)	$ (36)
Basic and diluted (loss) earnings per share attributable to 4Licensing Corporation common shareholders
Continuing operations (in dollars per share)	$ (0.03)	$ (0.05)	$ (0.24)	$ (0.03)
Discontinued operations (in dollars per share)	0	0.01	0	0.03
Basic and diluted loss per share attributable to 4Licensing Corporation common shareholders (in dollars per share)	$ (0.03)	$ (0.04)	$ (0.24)	$ 0
Weighted average common shares outstanding - basic (in shares)	14,962,993	13,738,773	14,770,984	13,727,812
Weighted average common shares outstanding - diluted (in shares)	14,962,993	13,738,773	14,770,984	13,727,812

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities:
Net loss	$ (3,951)	$ (571)
Income from discontinued operations	(31)	(385)
Loss from continuing operations	(3,982)	(956)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	115	122
Provision for returns and allowances	(9)	0
Loss on disposal of property and equipment	0	1
Non-cash interest expense, including amortization of discount on notes payable and warrants	1,503	167
Non-cash stock issuance cost	840	0
Share-based compensation	257	399
Change in fair value of derivative warrant liability	(1,124)	0
Gain on sale of assets	0	(270)
Inventory writedown	146	63
Changes in operating assets and liabilities:
Inventories - net	(7)	(689)
Accounts receivable	151	184
Prepaid expenses and other current assets	43	11
Other assets - net	298	36
Due to licensors	145	47
Accounts payable and accrued expenses	514	(1,056)
Deferred revenue	0	(7)
Long-term payable	(22)	9
Net cash used in continuing operating activities	(1,132)	(1,939)
Net cash provided (used) by discontinued operating activities	13	(118)
Net cash used in operating activities	(1,119)	(2,057)
Cash flows from investing activities:
Proceeds from sale of certain assets	0	270
Purchase of property and equipment	0	(19)
Net cash provided by investing activities	0	251
Cash flows from financing activities:
Proceeds from issuance of common stock and warrants	750	0
Proceeds from shareholder settlement	49	0
Proceeds from short-term debt	95	0
Capital contribution from noncontrolling interests	5	630
Proceeds from long-term debt	0	1,650
Proceeds from exercise of stock options	22	12
Net cash provided by financing activities	921	2,292
Net (decrease) increase in cash and cash equivalents	(198)	486
Cash and cash equivalents, beginning of period	235	356
Cash and cash equivalents, end of period	37	842
Supplemental schedule of non-cash financing activities
Warrants issued in connection with debt	0	979
Stock issuance cost recorded in equity	$ 750	$ 0

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 37	$ 235
Accounts receivable - net	54	196
Inventories - net	541	680
Prepaid expenses and other current assets	144	187
Current assets of discontinued operations	0	4
Total current assets	776	1,302
Property and equipment - net	29	38
Intangible assets - net	1,733	1,839
Other assets - net	113	411
Total assets	2,651	3,590
Current liabilities:
Due to licensors	424	279
Accounts payable and accrued expenses	1,468	954
Promissory notes-related party, net of discount of $28	217	0
Current liabilities of discontinued operations	92	114
Total current liabilities	2,201	1,347
Promissory notes-related party, net of discount of $281 and $710 at September 30, 2015 and December 31, 2014, respectively	1,219	940
Derivative warrant liability	466	0
Long-term payable	0	22
Total liabilities	$ 3,886	$ 2,309
Commitments and contingencies
4Licensing Corporation shareholders' equity
Preferred stock, $.01 par value - authorized 3,000,000 shares; none issued	$ 0	$ 0
Common stock, $.01 par value - authorized 40,000,000 shares; issued 17,102,195 and 15,916,308 shares; outstanding 14,978,308 and 13,792,421 shares at September 30, 2015 and December 31, 2014, respectively	171	159
Additional paid-in capital	72,480	71,062
Accumulated deficit	(21,169)	(17,641)
Shareholders' equity before treasury stock	51,482	53,580
Less cost of 2,123,887 treasury shares at September 30, 2015 and December 31, 2014	(36,488)	(36,488)
Total equity of 4Licensing Corporation shareholders	14,994	17,092
Noncontrolling interests (includes discontinued operations of $(16,177) at September 30, 2015 and December 31, 2014)	(16,229)	(15,811)
Total (deficit) equity	(1,235)	1,281
Total liabilities and (deficit) equity	$ 2,651	$ 3,590