live-10qa_20200331.htm

☒ QUARTERLY Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

☐ TRANSITION Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the issuer’s common stock, par value $0.001 per share, outstanding as of May 13, 2020 was 1,685,097.

We are filing this Amendment No. 1 on Form 10-Q/A to amend and restate in their entirety the following items of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 as originally filed with the Securities and Exchange Commission on May 15, 2020 (the “Original Form 10-Q”): (i) Item 1 of Part I “Financial Information,” (ii) Item 2 of Part I, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and (iii) Item 6 of Part II, “Exhibits”, and we have also updated the signature page, the certifications of our Chief Executive Officer and Chief Financial Officer in Exhibits 31.1, 31.2, 32.1 and 32.2, and our financial statements formatted in Extensible Business Reporting Language (XBRL) in Exhibits 101. No other sections were affected, but for the convenience of the reader, this report on Form 10-Q/A restates in its entirety, as amended, our Original Form 10-Q. This report on Form 10-Q/A is presented as of the filing date of the Original Form 10-Q and does not reflect events occurring after that date or modify or update disclosures in any way other than as required to reflect the restatement described below.

Our previously issued consolidated financial statements for the quarterly period ended March 31, 2020 has been reclassified and restated. As described in more detail in Note 1 to our consolidated financial statements, we have determined that our previously reported results for the quarter ended March 31, 2020 erroneously accounted for the gain in lease settlement for lease liabilities that were settled by our subsidiary ApplianceSmart, Inc during the reporting period.

Additionally, we have determined that our previously reported results for the quarter ended December 31, 2019 erroneously accounted for the impairment charges associated with certain right of use assets which were written down due to the voluntary Chapter 11 bankruptcy filing by our subsidiary ApplianceSmart, Inc. This correction is reflected for the six months ended March 31, 2020.

We have made necessary conforming changes in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” resulting from the correction of this error.

	March 31, 2020			September 30, 2019
	(Unaudited)
Assets
Cash	$	1,496		$	2,681
Trade receivables, net		15,847			11,901
Inventories, net		47,216			38,558
Income taxes receivable		147			235
Prepaid expenses and other current assets		1,032			2,377
Debtor in possession assets		1,739			—
Total current assets		67,477			55,752
Property and equipment, net		25,548			22,596
Right of use asset - operating leases		23,211			—
Deposits and other assets		46			90
Deferred taxes		4,030			4,869
Intangible assets, net		1,283			2,199
Goodwill		37,577			36,947
Total assets	$	159,172		$	122,453
Liabilities and Stockholders' Equity
Liabilities:
Accounts payable	$	9,778		$	14,144
Accrued liabilities		7,942			12,984
Lease obligation short term - operating leases		7,371			—
Current portion of long-term debt		20,940			7,897
Debtor-in-possession liabilities		12,804			—
Total current liabilities		58,835			35,025
Long-term debt, net of current portion		42,393			47,819
Lease obligation long term - operating leases		16,050			—
Notes payable related parties, net of current portion		4,826			4,826
Other non-current obligations		419			654
Total liabilities		122,523			88,324
Commitments and contingencies
Stockholders' equity:
Series B convertible preferred stock, $0.001 par value, 1,000,000 shares authorized, 214,244 shares issued and outstanding at March 31, 2020 and September 30, 2019		—			—
Series E convertible preferred stock, $0.001 par value, 200,000 shares authorized, 47,840 and 77,840 shares issued and outstanding at March 31, 2020 and September 30, 2019, respectively, with a liquidation preference of $0.30 per share outstanding		—			—
Common stock, $0.001 par value, 10,000,000 shares authorized, 1,719,442 and 1,826,009 shares issued and outstanding at March 31, 2020 and September 30, 2019, respectively		2			2
Paid in capital		64,340			63,924
Treasury stock common 368,744 shares as of March 31, 2020 and 262,177 shares as of September 30, 2019		(3,197	)		(2,438	)
Treasury stock Series E preferred 80,000 shares as of March 31, 2020 and 50,000 shares as of September 30, 2019		(7	)		(4	)
Accumulated deficit		(24,489	)		(27,355	)
Total stockholders' equity		36,649			34,129
Total liabilities and stockholders' equity	$	159,172		$	122,453

The accompanying notes are an integral part of these condensed consolidated financial statements.

	For the Three Months Ended March 31,						For the Six Months Ended March 31,
	2020			2019			2020			2019
Revenues	$	46,431		$	46,973		$	88,432		$	100,169
Cost of revenues		28,655			28,322			54,030			62,181
Gross profit		17,776			18,651			34,402			37,988

Operating expenses:
General and administrative expenses		11,701			12,794			22,510			25,694
Sales and marketing expenses		3,007			3,811			5,337			8,157
Total operating expenses		14,708			16,605			27,847			33,851
Operating income		3,068			2,046			6,555			4,137
Other (expense) income:
Interest expense, net		(1,270	)		(1,536	)		(2,627	)		(3,189	)
Gain on lease settlement, net		837			—			223			—
Other income (expense)		(125	)		165			(306	)		1,825
Total other (expense) income, net		(558	)		(1,371	)		(2,710	)		(1,364	)
Income before provision for income taxes		2,510			675			3,845			2,773
Provision for income taxes		629			202			979			769
Net income	$	1,881		$	473		$	2,866		$	2,004

Dividends declared - series B convertible preferred stock	$	—		$	—		$	—		$	—
Dividends declared - series E convertible preferred stock	$	—		$	—		$	—		$	—
Dividends declared - common stock	$	—		$	—		$	—		$	—

Earnings per share:
Basic	$	1.07		$	0.25		$	1.61		$	1.03
Diluted	$	0.54		$	0.13		$	0.82		$	0.53

Weighted average common shares outstanding:
Basic		1,752,908			1,925,972			1,779,706			1,935,610
Diluted		3,462,115			3,667,434			3,488,913			3,681,733

The accompanying notes are an integral part of these condensed consolidated financial statements.

	For the Six Months Ended March 31,
	2020			2019
OPERATING ACTIVITIES:
Net income	$	2,866		$	2,004
Adjustments to reconcile net income to net cash provided by operating activities, net of acquisition:
Depreciation and amortization		2,477			2,975
Non-cash asset retirements		—			103
Gain on lease settlement, net		(223	)		—
Gain or loss on disposal of property and equipment		106			(1,507	)
Amortization of debt issuance cost		212			193
Stock based compensation expense		48			78
Warrant extension fair value adjustment		368			—
Amortization of right-to-use assets		463
Change in deferred rent		—			17
Change in reserve for uncollectible accounts		421			391
Change in reserve for obsolete inventory		(139	)		(614	)
Change in deferred income taxes		839			689
Change in other		(218	)		232
Changes in assets and liabilities:
Trade receivables		117			1,041
Inventories		4,691			3,712
Income taxes receivable		88			(56	)
Prepaid expenses and other current assets		1,228			372
Deposits and other assets		128			23
Accounts payable		(5,918	)		(2,956	)
Accrued liabilities		(983	)		289
Net cash provided by operating activities		6,571			6,986

INVESTING ACTIVITIES:
Purchase of intangible assets		(4	)		(67	)
Lonesome Oak acquisition		(550	)		—
Proceeds from the sale of property and equipment		—			4,377
Purchase of property and equipment		(1,858	)		(963	)
Net cash provided by (used in) investing activities		(2,412	)		3,347

FINANCING ACTIVITIES:
Net borrowings (payments) under revolver loans		2,640			(2,516	)
Purchase of series E preferred treasury stock		(3	)		—
Payment of debt issuance cost		—			(118	)
Proceeds from issuance of notes payable		5,000			—
Purchase of common treasury stock		(759	)		(321	)
Payments on related party notes payable		—			(100	)
Debtor-in-possession cash		(187	)		—
Payments on notes payable		(12,035	)		(6,728	)
Net cash used in financing activities		(5,344	)		(9,783	)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(1,185	)		550
CASH AND CASH EQUIVALENTS, beginning of period		2,681			2,742
CASH AND CASH EQUIVALENTS, end of period	$	1,496		$	3,292

Supplemental cash flow disclosures:
Interest paid	$	1,187		$	2,953
Income taxes paid (refunded)	$	—		$	91

The accompanying notes are an integral part of these condensed consolidated financial statements.

	Series B Preferred Stock				Series E Preferred Stock				Common Stock							Series E Preferred Stock			Common Stock
	Shares		Amount		Shares		Amount		Shares			Amount		Paid-In Capital		Treasury Stock			Treasury Stock			Accumulated Deficit			Total Equity
Balance, December 31, 2019		214,244	$	—		47,840	$	—		1,784,310		$	2	$	64,219	$	(7	)	$	(2,781	)	$	(26,370	)	$	35,063
Stock based compensation		—		—		—		—		—			—		19		—			—			—			19
Warrant extension fair value adjustment		—		—		—		—		—			—		102		—			—			—			102
Purchase of common treasury stock		—		—		—		—		(64,868	)		—		—		—			(416	)		—			(416	)
Net income		—		—		—		—		—			—		—		—			—			1,881			1,881
Balance, March 31, 2020		214,244	$	—		47,840	$	—		1,719,442		$	2	$	64,340	$	(7	)	$	(3,197	)	$	(24,489	)	$	36,649

	Series B Preferred Stock				Series E Preferred Stock				Common Stock							Series E Preferred Stock			Common Stock
	Shares		Amount		Shares		Amount		Shares			Amount		Paid-In Capital		Treasury Stock			Treasury Stock			Accumulated Deficit			Total Equity
Balance, December 31, 2018		214,244	$	—		77,840	$	—		1,942,428		$	2	$	63,701	$	(4	)	$	(1,569	)	$	(21,123	)	$	41,007
Stock based compensation		—		—		—		—		—			—		31		—			—			—			31
Purchase of common treasury stock		—		—		—		—		(40,528	)		—		—		—			(302	)		—			(302	)
Net income		—		—		—		—		—			—		—		—			—			473			473
Balance, March 31, 2019		214,244	$	—		77,840	$	—		1,901,900		$	2	$	63,732	$	(4	)	$	(1,871	)	$	(20,650	)	$	41,209

The accompanying notes are an integral part of these condensed consolidated financial statements.

	Series B Preferred Stock				Series E Preferred Stock					Common Stock							Series E Preferred Stock			Common Stock
	Shares		Amount		Shares			Amount		Shares			Amount		Paid-In Capital		Treasury Stock			Treasury Stock			Accumulated Deficit			Total Equity
Balance, September 30, 2019		214,244	$	—		77,840		$	—		1,826,009		$	2	$	63,924	$	(4	)	$	(2,438	)	$	(27,355	)	$	34,129
Stock based compensation		—		—		—			—		—			—		48		—			—			—			48
Warrant extension fair value adjustment		—		—		—			—		—			—		368		—			—			—			368
Purchase of common treasury stock		—		—		—			—		(106,567	)		—		—		—			(759	)		—			(759	)
Purchase of Series E preferred stock		—		—		(30,000	)		—		—			—		—		(3	)		—			—			(3	)
Net income		—		—		—			—		—			—		—		—			—			2,866			2,866
Balance, March 31, 2020		214,244	$	—		47,840		$	—		1,719,442		$	2	$	64,340	$	(7	)	$	(3,197	)	$	(24,489	)	$	36,649

Nevada	85-0206668
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

325 E. Warm Springs Road, Suite 102 Las Vegas, Nevada	89119
(Address of principal executive offices)	(Zip Code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.001 par value per share		LIVE		The NASDAQ Stock Market LLC (The NASDAQ Capital Market)

		Page
	PART I

	FINANCIAL INFORMATION

Item 1.	Financial Statements	4

	Condensed Consolidated Balance Sheets as of March 31, 2020 (Unaudited) and September 30, 2019	4

	Condensed Consolidated Statements of Income (Unaudited) for the Three and Six Months Ended March 31, 2020 and 2019	5

	Condensed Consolidated Statements of Cash Flows (Unaudited) for the Three and Six Months Ended March 31, 2020 and 2019	6

	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) for the Three and Six Months Ended March 31, 2020 and 2019	7

	Notes to the Condensed Consolidated Financial Statements (Unaudited)	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	43

Item 4.	Controls and Procedures	43

	PART II

	OTHER INFORMATION	45

Item 1.	Legal Proceedings	45

Item 1A.	Risk Factors	45

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45

Item 3.	Defaults upon Senior Securities	45

Item 4.	Mine Safety Disclosures	45

Item 5.	Other Information	45

Item 6.	Exhibits	46

SIGNATURES		47

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐