What changed in this filing

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Item 1. Business

2022-03-09 compared with 2021-03-10 · 15 added, 29 removed, 101 unchanged (30% of the section changed)

7 unchanged sentences

The Company continually evaluates opportunities to expand the reach of its brands and to invest in other companies, both foreign and domestic, that own or license complementary brands.

In March 2018, pursuant to a merger agreement, the Company completed the acquisition of Taylor Holdco LLC and its subsidiaries (dba Filament Brands, and which the Company refers to as “Filament”).

Filament primarily designs, markets and distributes consumer and food service precision measurement products (including kitchen scales, thermometers and timers), bath scales, wine accessories, kitchen tools, and hydration products, and select outdoor products to major retailers in the United States, Canada and select distributors throughout Europe and Asia.

Filament distributes products under the Taylor, Salter, Springfield, HoMedics, Rabbit, Houdini, Metrokane, Mako, EatSmart, TravelWise, Chef’n, Vibe, d.stil, RBT and private label brand names.

Pursuant to the acquisition of Filament, the Company issued approximately 27% of its then-outstanding shares to Taylor Parent, LLC (“Taylor Parent”), and entered into a stockholders agreement (the “Stockholders Agreement”) with Taylor Parent, pursuant to which Taylor Parent has the right to:

(i) designate up to two persons for nomination for election or appointment to the Company’s Board of Directors, for so long as Taylor Parent beneficially owns at least 20% of the outstanding common stock of the Company on a fully diluted basis and (ii) designate one person for nomination for election or appointment to the Company’s Board of Directors, for so long as Taylor Parent beneficially owns more than 10% of the outstanding common stock of the Company on a fully diluted basis.

The other rights granted to Taylor Parent under the Stockholders Agreement are discussed in greater detail under Item 1A, “Risk Factors”, below.

The Company has a presence in international markets through subsidiaries and affiliate companies that are based outside of the United States.

Lifetime Brands Europe Limited is a wholly-owned subsidiary trading as Kitchen Craft.

Lifetime Brands Europe Limited is a wholly-owned subsidiary doing business as Kitchen Craft.

Kitchen Craft is a leading supplier of kitchenware and tableware products and accessories in the United Kingdom (“U.K.”) and in over 80 other countries.

In 2020, the Company completed its consolidation efforts of Lifetime Brands Europe Limited to create operational efficiencies.

As a result, Lifetime Brands Europe Limited’s brand development and design teams, administrative teams, and distribution combined and operated out of one state of the art facility in Aston, England.

As a result, Lifetime Brands Europe Limited’s brand development and design teams, administrative teams, and distribution operate out of one state of the art facility in Aston, England.

The Company also has a subsidiary in the People’s Republic of China (“China”) to supply kitchenware and tableware products to the Chinese market and a subsidiary based in Hong Kong to facilitate the sale of its products to other parts of Asia and smaller markets elsewhere in the world.

6 unchanged sentences

Mikasa® Owned Tableware and Home Solutions

Taylor® Owned Kitchenware and Home Solutions

KitchenAid® Licensed Kitchenware

Taylor® Owned Kitchenware and Home Solutions

BUILT NY® Owned Home Solutions

KitchenCraft® Owned Kitchenware

Kamenstein® Owned Kitchenware

Pfaltzgraff® Owned Kitchenware, Tableware and Home Solutions

BUILT NY® Owned Home Solutions

Rabbit® Owned Kitchenware

Kamenstein® Owned Kitchenware

MasterClass® Owned Kitchenware

1 unchanged sentence

With the exception of the Company’s sterling silver products, the Company sources almost all of its products from suppliers located outside the United States, primarily in China.

The Company manufactures its sterling silver products at a leased facility in San Germán, Puerto Rico and fills canisters with spices and assembles spice racks at its owned distribution facility in Winchendon, Massachusetts.

The Company manufactures its sterling silver products at a leased facility in San

Germán, Puerto Rico and fills canisters with spices and assembles spice racks at its owned distribution facility in Winchendon, Massachusetts.

BUSINESS SEGMENTS

9 unchanged sentences

During the years ended December 31, 2021, 2020 and 2019, Wal-Mart Stores, Inc., including Sam’s Club and, in the U.K., Asda Superstore, (“Walmart”), accounted for 18%, 20% and 16% of consolidated net sales, respectively.

During the years ended December 31, 2020 and 2019, sales to Costco Wholesale Corporation (“Costco”) accounted for 11% of consolidated net sales.

During the year ended December 31, 2020, Amazon.com Inc., (“Amazon”), accounted for 10% of consolidated net sales.

During the years ended December 31, 2021, 2020, and 2019, sales to Costco Wholesale Corporation (“Costco”) accounted for 12%, 11%, and 11% of consolidated net sales.

During the year ended December 31, 2021 and 2020, Amazon.com Inc., (“Amazon”), accounted for 12% and 10% of consolidated net sales.

Sales to Walmart, Costco and Amazon are included in the Company's U.S.

23 unchanged sentences

Menomonee Falls, Wisconsin;

Aston, England;

and Hong Kong.

and Aston, England.

The Company generally collaborates with its largest wholesale customers and in many instances produces specific versions of the Company’s product lines with exclusive designs and/or packaging for them.

6 unchanged sentences

Most of the Company’s suppliers are located in China.

The Company also sources products from suppliers across various countries including, Hong Kong, Taiwan, Japan, South Korea, Vietnam, Malaysia, Thailand, India, the United States, Canada, Mexico, the U.K., Italy, France, Portugal, Poland, Sweden, Turkey, Netherlands, Denmark, Belgium, Germany, Czech Republic, Slovakia, Cambodia, Indonesia and Australia.

The Company also sources products from suppliers across various countries including, Hong Kong, Taiwan, Japan, South Korea, Vietnam, Malaysia, Philippines, Thailand, India, the United States, Canada, Mexico, Peru, the U.K., Ireland, Switzerland, Italy, France, Portugal, Poland, Sweden, Turkey, Netherlands, Denmark, Belgium, Germany, Czech Republic, Slovakia, Cambodia, Indonesia and Australia.

The Company orders products significantly in advance of the anticipated time of their sale by the Company.

4 unchanged sentences

The markets for kitchenware, tableware and other products used in the home including home décor products are highly competitive and include numerous domestic and foreign competitors, some of which are larger than the Company.

The primary competitive factors

in selling such products are innovative products, brand, quality, aesthetic appeal to consumers, packaging, breadth of product line, distribution capability and selling price.

The primary competitive factors in selling such products are innovative products, brand, quality, aesthetic appeal to consumers, packaging, breadth of product line, distribution capability and selling price.

PATENTS AND LICENSES

12 unchanged sentences

Further, we offer professional development opportunities to cultivate talent throughout the Company.

We are focused on employee health and safety initiatives and have implemented protocols during the COVID-19 pandemic to enhance workplace safety.

We are focused on employee health and safety initiatives and have implemented protocols during the COVID-19 pandemic to enhance workplace safety, including remote work for certain departments.

The Company also values diversity and inclusion and is striving to create a more diverse workforce and inclusive community.

9 unchanged sentences

In 2021, net sales in the third and fourth quarters accounted for 56% of total annual net sales.

In 2020, the Company's inventory levels did not significantly decrease during the fourth quarter.

The higher inventory levels at December 31, 2020, were a result of increased inventory purchases to meet higher expected demand in 2021 due in part to the effects on demand from the COVID-19 pandemic.

RESTRUCTURING

During the years ended December 31, 2019 and 2018, the Company's U.S.

segment incurred $0.7 million and $2.1 million, respectively, of restructuring expense related to the integration of Filament.

During the year ended December 31, 2020, the Company's International segment incurred $0.2 million of restructuring expenses related to severance associated with the strategic reorganization of the International segment’s product development and sales workforce.

The strategic reorganization was the result of the Company's efforts for product development efficiencies and an international sales approach tailored to countries.

During the years ended December 31, 2019, and 2018, the Company's international segment incurred $0.7 million and $0.2 million, respectively, of restructuring expense primarily related to the integration of its legal entities operating in Europe.

The Company does not expect to incur any additional restructuring charges for these efforts.

In 2021, the Company's inventory levels increased during the fourth quarter compared to the third quarter.

The higher inventory balance at December 31, 2021, was a result of increased inventory purchases, to maintain inventory availability and meet expected demand, and higher inventory cost.

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-K

Item 1. Business