What changed in this filing

/stocks — the workspaceLOADING

Item 3. Quantitative and Qualitative Disclosures About Market Risk

2026-06-12 compared with 2025-12-12 · 38 added, 35 removed, 2 unchanged (97% of the section changed)

Quantitative and Qualitative Disclosures About Market Risk

are exposed to various types of market risk in the normal course of our business, including the impact of interest rate changes, raw

materials price risk and changes in foreign currency exchange rates, which could impact our results of operations or financial condition.

We manage our exposure to this risk through our normal operating activities.

under the Amended and Restated Loan Agreement will bear interest at a rate per annum equal to the then-current Term SOFR Rate for a period

of one month plus 0.10% plus a margin of 1.75%.

Quantitative and Qualitative Disclosures

About Market Risk

We are exposed to various types of market risk

in the normal course of our business, including the impact of interest rate changes, raw materials price risk and changes in foreign currency

exchange rates, which could impact our results of operations or financial condition.

We manage our exposure to this risk through our normal

operating activities.

Interest Rate Risk

Borrowings under the Amended and Restated Loan

Agreement will bear interest at a rate per annum equal to the then-current Term SOFR Rate for a period of one month plus 0.10% plus a

margin of 1.75%.

The Term SOFR Rate will be adjusted on a monthly basis.

As such, these debt instruments

expose us to market risk for changes in interest rates.

As of November 2, 2025, we had $4.1 million in principal amount of outstanding

At current borrowing levels, a 1% increase in the SOFR rate would result in an annual increase in interest expenses of approximately

There were no additional borrowings outstanding under the Amended and Restated Loan Agreement as of November 2, 2025.

Materials Price Risk

are exposed to market risk from changes in the cost of raw materials used in our domestic upholstery manufacturing processes;

wood, fabric, and foam products.

Increases in home construction activity could result in increases in wood and fabric costs.

Additionally,

the cost of petroleum-based foam products we utilize are sensitive to crude oil prices, which vary due to supply, demand, and geo-political

imported products, we generally negotiate firm pricing denominated in U.S.

Dollars with our foreign suppliers, typically for periods

of at least one year.

We accept the exposure to exchange rate movements beyond these negotiated periods.

We do not use derivative

financial instruments to manage this risk but could choose to do so in the future.

Most of our imports are purchased from suppliers

located in Vietnam and China.

The Chinese currency floats within a limited range in relation to the U.S.

Dollar, resulting in exposure

to foreign currency exchange rate fluctuations.

we transact our imported product purchases in U.S.

As such, these debt instruments expose us to market risk for

changes in interest rates.

As of May 3, 2026, there were no outstanding loans, other than amounts reserved for standby letters of credit

in the amount of $3.2 million.

Raw Materials Price Risk

We are exposed to market risk from changes in

the cost of raw materials used in our domestic upholstery manufacturing processes;

principally, wood, fabric, and foam products.

in home construction activity could result in increases in wood and fabric costs.

Additionally, the cost of petroleum-based foam products

we utilize are sensitive to crude oil prices, which vary due to supply, demand, and geo-political factors.

Currency Risk

For imported products, we generally negotiate

firm pricing denominated in U.S.

Dollars with our foreign suppliers, typically for periods of at least one year.

We accept the exposure

to exchange rate movements beyond these negotiated periods.

We do not use derivative financial instruments to manage this risk but could

choose to do so in the future.

Most of our imports are purchased from suppliers located in Vietnam and China.

currency floats within a limited range in relation to the U.S.

Dollar, resulting in exposure to foreign currency exchange rate fluctuations.

Since we transact our imported product purchases

Dollars, a relative decline in the value of the U.S.

Dollar could increase the price

we pay for imported products beyond the negotiated periods.

We generally expect to reflect substantially all of the effect of any price

increases from suppliers in the prices we charge for imported products.

However, these changes could adversely impact sales volume or

profit margins during affected periods.

Dollar could increase the price we pay for imported products beyond the negotiated

We generally expect to reflect substantially all of the effect of any price increases from suppliers in the prices we charge

for imported products.

However, these changes could adversely impact sales volume or profit margins during affected periods.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk