Delaware
|
13-3458955
|
(State or other jurisdiction of incorporation or organization)
|
(IRS Employer Identification No.)
|
Common Stock, $.01 par value
|
NYSE AMERICAN LLC
|
(Title of each class)
|
(Name of each exchange on which registered)
|
Large accelerated filer
¨
|
|
Accelerated filer
¨
|
Non-accelerated filer
x
|
|
Smaller reporting company
x
|
Emerging growth company
¨
|
|
|
|
|
Page
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 1B.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
||
|
|
|
Item 5.
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
|
||
|
|
|
Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
|
||
|
|
|
Item 15.
|
||
|
Item 1.
|
BUSINESS
|
•
|
Our engineering services include the design, development, and fabrication of customized stress testing platforms to simulate a product’s end application, such as thermal cycling and vibration, in order to ensure reliable performance and avoid catastrophic failure when the product is placed in service.
|
•
|
Our vertical manufacturing model offers customers the ability to simplify their supply chain by utilizing a single supplier for their critical components including complex printed circuit board assembly (“PCBA”), precision metalworking, and interconnect solutions. This service model allows us to control the cost, lead time, and quality of these critical components which are then integrated into full system assemblies and minimizes our customers’ supply chain risk.
|
•
|
We provide direct order fulfillment services for our customers by integrating with their configuration management process to obtain their customer orders, customize the product to the specific requirements, functionally test the product and provide verification data, and direct ship to their end customer in order to reduce time, cost, and complexity within our customer’s supply chain.
|
•
|
We are the only EMS provider with an on-site laboratory that has been approved by the Defense Logistics Agency (“DLA”) for their Qualified Testing Supplier List (“QTSL”) program which deems the site suitable to conduct various QTSL and military testing standards including counterfeit component analysis. In addition, this advanced laboratory is utilized for complex design analysis and manufacturing process development to solve challenges and accelerate our customers’ time to market.
|
•
|
Newark, New York - Located approximately one hour east of Rochester, New York, our Newark location is our corporate headquarters and is the largest manufacturing location providing complex circuit board manufacturing, interconnect solutions, and system-level assemblies along with an on-site material analysis laboratory for advanced manufacturing process development.
|
•
|
Rochester, New York - Focuses on precision metalworking services including complex metal chassis and assemblies.
|
•
|
Albuquerque, New Mexico - Specializes in the aerospace and defense markets with complex circuit board and system-level assemblies along with a state of the art analysis and testing laboratory which conducts counterfeit component analysis and complex design analysis.
|
|
|
Years Ended
|
||
% of Sales by Sector
|
|
September 30, 2018
|
|
September 30, 2017
|
|
|
|
|
|
Aerospace and Defense
|
|
59%
|
|
52%
|
Medical
|
|
22%
|
|
28%
|
Industrial
|
|
19%
|
|
20%
|
|
|
100%
|
|
100%
|
Item 1A.
|
RISK FACTORS
|
•
|
adverse changes in general economic conditions;
|
•
|
natural disasters that may impede our operations, the operation of our customers’ business, or availability of manufacturing inputs from our suppliers;
|
•
|
the level and timing of customer orders and the accuracy of customer forecasts;
|
•
|
the capacity utilization of our manufacturing facilities and associated fixed costs;
|
•
|
price competition;
|
•
|
market acceptance of our customers’ products;
|
•
|
business conditions in our customers’ end markets;
|
•
|
our level of experience in manufacturing a particular product;
|
•
|
changes in the mix of sales to our customers;
|
•
|
variations in efficiencies achieved in managing inventories and property, plant and equipment;
|
•
|
fluctuations in cost and availability of materials;
|
•
|
timing of expenditures in anticipation of future orders;
|
•
|
changes in cost and availability of labor and components;
|
•
|
our effectiveness in managing the high reliability manufacturing process required by our customers; and
|
•
|
failure or external breach of our information technology systems.
|
•
|
incur debt;
|
•
|
incur or maintain liens;
|
•
|
make acquisitions of businesses or entities;
|
•
|
make investments, loans or advances;
|
•
|
enter into guarantee agreements;
|
•
|
engage in mergers, consolidations or certain sales of assets;
|
•
|
engage in transactions with affiliates;
|
•
|
pay dividends or engage in stock redemptions or repurchases; and
|
•
|
make capital expenditures.
|
•
|
the inability of our customers to adapt to rapidly changing technology and evolving industry standards, which result in short product life cycles;
|
•
|
the inability of our customers to develop and market their products, some of which are new and untested;
|
•
|
increased competition among our customers and their competitors, including downward pressure on pricing;
|
•
|
the potential that our customers’ products may become obsolete, or the failure of our customers’ products to gain anticipated commercial acceptance; and
|
•
|
periods of significantly decreased demand in our customers’ markets.
|
•
|
variation in demand for our customers’ products in their end markets;
|
•
|
actions taken by our customers to manage their inventory;
|
•
|
product design changes by our customers; or
|
•
|
changes in our customers’ manufacturing strategy.
|
•
|
deciding on the levels of business that we will seek;
|
•
|
production schedules;
|
•
|
component procurement commitments;
|
•
|
equipment requirements;
|
•
|
personnel needs; and
|
•
|
other resource requirements.
|
•
|
hire and retain qualified engineering and technical personnel;
|
•
|
maintain and enhance our technological leadership; and
|
•
|
develop and market manufacturing services that meet changing customer needs.
|
Item 1B.
|
UNRESOLVED STAFF COMMENTS
|
Location
|
Principal Use
|
Building SF
|
Owned/Leased
|
Lease Expiration
|
Newark, New York
(1)
|
AO,E,M,W,D
|
235,000
|
Owned
|
N/A
|
Rochester, New York
|
AO,M,W,D
|
47,000
|
Leased
|
5/31/2033
|
Albuquerque, New Mexico
|
AO,E,M,W,D
|
72,000
|
Leased
|
5/31/2033
|
(1)
|
Please see the disclosure regarding the expansion of our operations in Newark, NY above under “Expansion of Newark, New York Manufacturing Operations” in Part I, Item 1 of this report.
|
|
Age
|
|
Jeffrey T. Schlarbaum
|
52
|
President and Chief Executive Officer
|
Thomas L. Barbato
|
49
|
Senior Vice President and Chief Financial Officer
|
|
|
Years Ended
|
||||||
Income Statement Data
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Net sales
|
|
$
|
116,922
|
|
|
$
|
96,455
|
|
|
|
|
|
|
||||
Gross profit
|
|
14,157
|
|
|
11,257
|
|
||
Selling and administrative expenses
|
|
11,438
|
|
|
10,197
|
|
||
Interest expense
|
|
1,146
|
|
|
917
|
|
||
Income before income taxes
|
|
1,573
|
|
|
143
|
|
||
(Benefit)/provision for income taxes
|
|
(8,837
|
)
|
|
62
|
|
||
Net income
|
|
$
|
10,410
|
|
|
$
|
81
|
|
|
|
Years Ended
|
||
% of Sales by Sector
|
|
September 30,
2018 |
|
September 30,
2017 |
|
|
|
|
|
Aerospace and Defense
|
|
59%
|
|
52%
|
Medical
|
|
22%
|
|
28%
|
Industrial
|
|
19%
|
|
20%
|
|
|
100%
|
|
100%
|
|
|
Years Ended
|
||||||
Cash Flow Data
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Cash, beginning of year
|
|
$
|
—
|
|
|
$
|
845
|
|
Net cash flow provided by/(used in):
|
|
|
|
|
|
|
||
Operating activities
|
|
(203
|
)
|
|
1,759
|
|
||
Investing activities
|
|
(1,982
|
)
|
|
2,222
|
|
||
Financing activities
|
|
2,185
|
|
|
(4,826
|
)
|
||
Net cash decrease for the year
|
|
—
|
|
|
(845
|
)
|
||
Cash, end of year
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Page
|
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash
|
|
$
|
—
|
|
|
$
|
—
|
|
Accounts receivable, net of allowance
|
|
25,168
|
|
|
17,887
|
|
||
Inventories
|
|
34,126
|
|
|
15,605
|
|
||
Other current assets
|
|
1,747
|
|
|
1,018
|
|
||
Total current assets
|
|
61,041
|
|
|
34,510
|
|
||
|
|
|
|
|
||||
Property, plant and equipment, net
|
|
20,110
|
|
|
17,777
|
|
||
Deferred income taxes
|
|
8,855
|
|
|
—
|
|
||
Other long-term assets
|
|
442
|
|
|
160
|
|
||
|
|
|
|
|
||||
Total assets
|
|
$
|
90,448
|
|
|
$
|
52,447
|
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Current portion of long-term debt
|
|
$
|
1,449
|
|
|
$
|
987
|
|
Current portion of capital lease obligation
|
|
306
|
|
|
215
|
|
||
Accounts payable
|
|
28,689
|
|
|
13,046
|
|
||
Accrued payroll and related expenses
|
|
1,796
|
|
|
1,013
|
|
||
Other accrued expenses
|
|
458
|
|
|
444
|
|
||
Customer deposits
|
|
7,595
|
|
|
1,611
|
|
||
Total current liabilities
|
|
40,293
|
|
|
17,316
|
|
||
|
|
|
|
|
||||
Long-term debt
|
|
16,002
|
|
|
14,023
|
|
||
Long-term capital lease obligation
|
|
7,027
|
|
|
5,362
|
|
||
Other long-term liabilities
|
|
1,750
|
|
|
1,317
|
|
||
Total liabilities
|
|
65,072
|
|
|
38,018
|
|
||
|
|
|
|
|
||||
Commitments and contingencies (Note 11)
|
|
|
|
|
||||
|
|
|
|
|
||||
STOCKHOLDERS’ EQUITY
|
|
|
|
|
||||
Preferred stock, $0.01 par value:
|
|
—
|
|
|
—
|
|
||
500,000 shares authorized; none issued or outstanding
|
|
|
|
|
||||
Common stock, $0.01 par value:
|
|
|
|
|
||||
Authorized 50,000,000 shares
|
|
|
|
|
||||
Issued: 11,304,393 and 11,252,566 shares, respectively
|
|
|
|
|
||||
Outstanding: 10,248,905 and 10,197,078 shares, respectively
|
|
102
|
|
|
102
|
|
||
Additional paid-in capital
|
|
47,326
|
|
|
46,789
|
|
||
Accumulated deficit
|
|
(20,463
|
)
|
|
(30,873
|
)
|
||
Treasury stock, at cost: 1,055,488 shares
|
|
(1,589
|
)
|
|
(1,589
|
)
|
||
Total stockholders’ equity
|
|
25,376
|
|
|
14,429
|
|
||
|
|
|
|
|
||||
Total liabilities and stockholders’ equity
|
|
$
|
90,448
|
|
|
$
|
52,447
|
|
|
|
Years Ended
|
||||||
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
|
|
|
|
|
||||
Net sales
|
|
$
|
116,922
|
|
|
$
|
96,455
|
|
Cost of sales
|
|
102,765
|
|
|
85,198
|
|
||
Gross profit
|
|
14,157
|
|
|
11,257
|
|
||
|
|
|
|
|
||||
Selling and administrative expenses
|
|
11,438
|
|
|
10,197
|
|
||
Operating profit
|
|
2,719
|
|
|
1,060
|
|
||
|
|
|
|
|
||||
Interest expense
|
|
1,146
|
|
|
917
|
|
||
Income before income taxes
|
|
1,573
|
|
|
143
|
|
||
|
|
|
|
|
||||
(Benefit)/provision for income taxes
|
|
(8,837
|
)
|
|
62
|
|
||
|
|
|
|
|
||||
Net income
|
|
$
|
10,410
|
|
|
$
|
81
|
|
|
|
|
|
|
||||
Net income per common share:
|
|
|
|
|
||||
Basic
|
|
$
|
1.01
|
|
|
$
|
0.01
|
|
Diluted
|
|
$
|
1.01
|
|
|
$
|
0.01
|
|
|
|
|
|
|
||||
Weighted average number of shares outstanding:
|
|
|
|
|
||||
Basic
|
|
10,228,596
|
|
|
10,181,868
|
|
||
Diluted
|
|
10,320,203
|
|
|
10,181,868
|
|
|
Number of Shares Outstanding
|
|
Common
Stock, par $0.01 |
|
Additional
Paid-In Capital |
|
Retained
(Deficit) |
|
Treasury
Stock, at cost |
|
Total
Stockholders’ Equity |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances, October 1, 2016
|
10,160,128
|
|
|
$
|
102
|
|
|
$
|
46,305
|
|
|
$
|
(30,954
|
)
|
|
$
|
(1,589
|
)
|
|
$
|
13,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|
—
|
|
|
81
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
460
|
|
|
—
|
|
|
—
|
|
|
460
|
|
|||||
Vested restricted stock
|
31,559
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Shares withheld for payment of taxes
upon vesting of restricted stock |
(1,825
|
)
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Employee stock plan purchase
|
7,216
|
|
|
—
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances, September 30, 2017
|
10,197,078
|
|
|
102
|
|
|
46,789
|
|
|
(30,873
|
)
|
|
(1,589
|
)
|
|
14,429
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
10,410
|
|
|
—
|
|
|
10,410
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
489
|
|
|
—
|
|
|
—
|
|
|
489
|
|
|||||
Vested restricted stock
|
40,107
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for payment of taxes
upon vesting of restricted stock |
(1,743
|
)
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||||
Exercise of stock options
|
1,400
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Employee stock plan purchases
|
12,063
|
|
|
—
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances, September 30, 2018
|
10,248,905
|
|
|
$
|
102
|
|
|
$
|
47,326
|
|
|
$
|
(20,463
|
)
|
|
$
|
(1,589
|
)
|
|
$
|
25,376
|
|
|
|
Years Ended
|
||||||
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income
|
|
$
|
10,410
|
|
|
$
|
81
|
|
Non-cash adjustments:
|
|
|
|
|
||||
Stock-based compensation
|
|
489
|
|
|
460
|
|
||
Depreciation and amortization
|
|
2,351
|
|
|
2,609
|
|
||
Loss on sale of property, plant and equipment
|
|
—
|
|
|
4
|
|
||
Change in reserve for doubtful accounts
|
|
10
|
|
|
(151
|
)
|
||
Change in excess/obsolete inventory reserve
|
|
123
|
|
|
(111
|
)
|
||
Deferred tax benefit
|
|
(8,855
|
)
|
|
—
|
|
||
Amortization of deferred gain on sale of leaseback
|
|
(83
|
)
|
|
(61
|
)
|
||
|
|
|
|
|
||||
Changes in assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
|
(7,291
|
)
|
|
(596
|
)
|
||
Inventories
|
|
(18,644
|
)
|
|
(110
|
)
|
||
Other current assets
|
|
(729
|
)
|
|
196
|
|
||
Other long-term assets
|
|
(333
|
)
|
|
—
|
|
||
Accounts payable
|
|
13,540
|
|
|
1,624
|
|
||
Change in book overdraft position
|
|
2,103
|
|
|
558
|
|
||
Accrued expenses
|
|
797
|
|
|
(2,437
|
)
|
||
Customer deposits
|
|
5,984
|
|
|
(145
|
)
|
||
Other long-term liabilities
|
|
(75
|
)
|
|
(162
|
)
|
||
Net cash flows (used in)/provided by operating activities
|
|
(203
|
)
|
|
1,759
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
||||
Purchases of property, plant and equipment
|
|
(3,934
|
)
|
|
(3,533
|
)
|
||
Proceeds from disposal of property, plant and equipment
|
|
5
|
|
|
5
|
|
||
Proceeds from sale-leaseback transaction
|
|
1,947
|
|
|
5,750
|
|
||
Net cash flows (used in)/provided by investing activities
|
|
(1,982
|
)
|
|
2,222
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
||||
Advances from revolving line of credit
|
|
62,380
|
|
|
46,851
|
|
||
Repayments of revolving line of credit
|
|
(58,153
|
)
|
|
(42,043
|
)
|
||
Borrowings under other loan agreements
|
|
1,150
|
|
|
—
|
|
||
Repayments under other loan agreements
|
|
(2,921
|
)
|
|
(9,396
|
)
|
||
Repayments under capital lease
|
|
(244
|
)
|
|
(173
|
)
|
||
Debt issuance costs
|
|
(75
|
)
|
|
(89
|
)
|
||
Proceeds from exercise of stock options
|
|
6
|
|
|
—
|
|
||
Proceeds from employee stock plan purchases
|
|
50
|
|
|
27
|
|
||
Cash paid for employee taxes upon vesting of restricted stock
|
|
(8
|
)
|
|
(3
|
)
|
||
Net cash flows provided by/(used in) financing activities
|
|
2,185
|
|
|
(4,826
|
)
|
||
|
|
|
|
|
||||
Net cash decrease for the year
|
|
—
|
|
|
(845
|
)
|
||
Cash, beginning of year
|
|
—
|
|
|
845
|
|
||
Cash, end of year
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
||||
Supplemental cash flow information:
|
|
|
|
|
||||
Interest paid
|
|
$
|
1,151
|
|
|
$
|
922
|
|
Income taxes paid
|
|
7
|
|
|
127
|
|
||
Property, plant and equipment additions financed through capital lease
|
|
2,000
|
|
|
5,750
|
|
PP&E Lives
|
|
Estimated
Useful Lives |
|
|
(years)
|
Land improvements
|
|
10
|
Buildings and improvements
|
|
5 to 40
|
Machinery and equipment
|
|
3 to 5
|
Furniture and fixtures
|
|
3 to 7
|
Software
|
|
3 to 10
|
|
|
Years Ended
|
||||||
Allowance for doubtful accounts
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Allowance, beginning of period
|
|
$
|
75
|
|
|
$
|
226
|
|
Change in provision for doubtful accounts
|
|
10
|
|
|
(144
|
)
|
||
Write-offs
|
|
—
|
|
|
(7
|
)
|
||
Allowance, end of period
|
|
$
|
85
|
|
|
$
|
75
|
|
Inventories
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Raw materials
|
|
$
|
21,323
|
|
|
$
|
8,964
|
|
Work-in-process
|
|
11,263
|
|
|
5,080
|
|
||
Finished goods
|
|
1,540
|
|
|
1,561
|
|
||
Total inventories
|
|
$
|
34,126
|
|
|
$
|
15,605
|
|
Property, Plant and Equipment
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Land and improvements
|
|
$
|
788
|
|
|
$
|
788
|
|
Buildings and improvements
|
|
7,314
|
|
|
8,910
|
|
||
Building under capital lease
|
|
7,750
|
|
|
5,750
|
|
||
Machinery and equipment
|
|
30,969
|
|
|
27,947
|
|
||
Furniture and fixtures
|
|
7,877
|
|
|
7,520
|
|
||
Construction in progress
|
|
5,360
|
|
|
4,968
|
|
||
Total property, plant and equipment, at cost
|
|
60,058
|
|
|
55,883
|
|
||
Accumulated depreciation
|
|
(39,948
|
)
|
|
(38,106
|
)
|
||
Property, plant and equipment, net
|
|
$
|
20,110
|
|
|
$
|
17,777
|
|
|
|
Years Ended
|
||||||
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Depreciation expense
|
|
$
|
2,358
|
|
|
$
|
2,515
|
|
|
|
Fixed/
|
|
|
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||
|
|
Variable
|
|
|
|
|
|
Interest
|
|
|
|
Interest
|
||||||
Debt
|
|
Rate
|
|
Date
|
|
Balance
|
|
Rate
|
|
Balance
|
|
Rate
|
||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
M&T credit facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revolving Credit Facility
|
|
v
|
|
5/5/2022
|
|
$
|
12,996
|
|
|
5.26
|
%
|
|
$
|
8,769
|
|
|
3.73
|
%
|
Term Loan B
|
|
v
|
|
5/5/2022
|
|
3,636
|
|
|
5.36
|
|
|
5,714
|
|
|
3.99
|
|
||
Celmet Building Term Loan
|
|
f
|
|
11/7/2018
|
1
|
—
|
|
|
—
|
|
|
802
|
|
|
4.72
|
|
||
Equipment Line Advances
|
|
v
|
|
12/18/2018
|
|
314
|
|
|
5.56
|
|
|
—
|
|
|
—
|
|
||
Equipment Line Term Note
|
|
v
|
|
Various
|
2
|
794
|
|
|
5.56
|
|
|
—
|
|
|
—
|
|
||
Total debt, gross
|
|
|
|
|
|
17,740
|
|
|
|
|
15,285
|
|
|
|
||||
Unamortized debt issuance costs
|
|
|
|
|
|
(289
|
)
|
|
|
|
(275
|
)
|
|
|
||||
Total debt, net
|
|
|
|
|
|
17,451
|
|
|
|
|
15,010
|
|
|
|
||||
Less: current portion
|
|
|
|
|
|
(1,449
|
)
|
|
|
|
(987
|
)
|
|
|
||||
Long-term debt
|
|
|
|
|
|
$
|
16,002
|
|
|
|
|
$
|
14,023
|
|
|
|
a)
|
Revolving Credit Facility (“Revolver”)
: At
September 30, 2018
, up to
$22.0 million
is available through
May 5, 2022
. The maximum amount the Company may borrow is determined based on a borrowing base calculation described below.
|
b)
|
Term Loan B:
$14.0 million
was borrowed on January 18, 2013. Principal is being repaid in
120 equal monthly installments
of
$117 thousand
. As part of an amendment to the Credit Facility, as amended, the principal was modified from $8.0 million to $6.0 million and principal is being repaid in equal monthly installments of $71 thousand plus a balloon payment of
$0.6 million
. The maturity date of the loan is
May 5, 2022
. The proceeds of the sale-leaseback transaction described in
Note 12—Capital Lease
, were used to pay down a portion of the loan.
|
c)
|
Celmet Building Term Loan:
$1.3 million
was borrowed on November 8, 2013 pursuant to an amendment to the Credit Facility, as amended. The proceeds were used to reimburse the Company’s cost of purchasing its Rochester, New York facility. Principal was being repaid in
59 equal monthly installments
of
$11 thousand
plus a balloon payment of $672 thousand due at maturity on
November 7, 2018
. The loan was repaid in connection with the sale-leaseback transaction described in
Note 12—Capital Lease
.
|
d)
|
Equipment Line Advances
: Up to $1.5 million is available through May 5, 2022. Interest only is paid until maturity. Principal is due six months after borrowing or can be converted to an Equipment Line Term Loan. On September 18, 2018,
$0.3 million
was borrowed.
|
e)
|
Equipment Line Term Note
:
$0.8 million
was converted from an Equipment Line Advance on July 26, 2018 and is being repaid in 36 equal monthly installments of
$21 thousand
and matures July 26, 2021.
$0.1 million
was converted from an Equipment Line Advance on September 27, 2018 and is being repaid in 36 equal monthly installments of
$2 thousand
and matures September 29, 2021.
|
Debt Repayment Schedule
|
|
Contractual
Principal Payments |
|||||
(in thousands)
|
|
|
|
|
|||
Twelve months ended September 30,
|
|
|
|||||
2019
|
|
|
|
|
$
|
1,449
|
|
2020
|
|
|
|
|
1,136
|
|
|
2021
|
|
|
|
|
1,094
|
|
|
2022
|
(1)
|
|
|
|
14,061
|
|
|
|
|
|
|
|
$
|
17,740
|
|
|
|
Years Ended
|
||||||
Warranty Reserve
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
|
|
||
Reserve, beginning of period
|
|
$
|
153
|
|
|
$
|
180
|
|
Provision
|
|
266
|
|
|
137
|
|
||
Warranty costs
|
|
(246
|
)
|
|
(164
|
)
|
||
Reserve, end of period
|
|
$
|
173
|
|
|
$
|
153
|
|
|
|
Years Ended
|
||||||
Valuation of Options
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
|
|
|
|
|
||||
Assumptions for Black-Scholes:
|
|
|
|
|
||||
Risk-free interest rate
|
|
2.84
|
%
|
|
1.50
|
%
|
||
Expected term in years
|
|
5.5
|
|
|
4.0
|
|
||
Volatility
|
|
33
|
%
|
|
39
|
%
|
||
Expected annual dividends
|
|
none
|
|
|
none
|
|
||
|
|
|
|
|
|
|||
Value of options granted:
|
|
|
|
|
|
|||
Number of options granted
|
|
120,000
|
|
|
57,500
|
|
||
Weighted average fair value per share
|
|
$
|
1.84
|
|
|
$
|
1.19
|
|
Fair value of options granted (000s)
|
|
$
|
221
|
|
|
$
|
68
|
|
|
|
Years Ended
|
||||||||||||
|
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||
Stock Options
|
|
Number
of Options |
|
Wgtd. Avg. Exercise Price
|
|
Number
of Options |
|
Wgtd. Avg. Exercise Price
|
||||||
|
|
|
|
|
|
|
|
|
||||||
Outstanding, beginning of period
|
|
743,045
|
|
|
$
|
4.27
|
|
|
759,795
|
|
|
$
|
4.43
|
|
Granted
|
|
120,000
|
|
|
5.19
|
|
|
57,500
|
|
|
3.64
|
|
||
Exercised
|
|
(1,400
|
)
|
|
4.08
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
|
(114,000
|
)
|
|
4.78
|
|
|
(44,500
|
)
|
|
5.67
|
|
||
Expired
|
|
(10,500
|
)
|
|
5.24
|
|
|
(29,750
|
)
|
|
5.04
|
|
||
Outstanding, end of period
|
|
737,145
|
|
|
$
|
4.33
|
|
|
743,045
|
|
|
$
|
4.27
|
|
|
|
|
|
|
|
|
|
|
||||||
For options expected to vest
|
|
|
|
|
|
|
|
|
|
|
||||
Number expected to vest
|
|
724,398
|
|
|
$
|
4.32
|
|
|
727,403
|
|
|
$
|
4.29
|
|
Weighted average remaining life, in years
|
|
4.0
|
|
|
|
|
4.6
|
|
|
|
|
|||
Intrinsic value (000s)
|
|
|
|
$
|
733
|
|
|
|
|
|
$
|
545
|
|
|
|
|
|
|
|
|
|
|
|
||||||
For exercisable options
|
|
|
|
|
|
|
|
|
|
|
||||
Number exercisable
|
|
426,358
|
|
|
$
|
4.24
|
|
|
332,472
|
|
|
$
|
4.40
|
|
Weighted average remaining life, in years
|
|
3.3
|
|
|
|
|
4.1
|
|
|
|
|
|||
Intrinsic value (000s)
|
|
|
|
$
|
467
|
|
|
|
|
|
$
|
229
|
|
|
|
|
|
|
|
|
|
|
|
||||||
For non-exercisable options
|
|
|
|
|
|
|
|
|
|
|
||||
Expense not yet recognized (000s)
|
|
|
|
$
|
343
|
|
|
|
|
|
$
|
416
|
|
|
Weighted average years to be recognized
|
|
2.8
|
|
|
|
|
1.8
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
||||||
For options exercised
|
|
|
|
|
|
|
|
|
||||||
Intrinsic value (000s)
|
|
|
|
$
|
2
|
|
|
|
|
|
$
|
—
|
|
|
|
Years Ended
|
||||||||||||
|
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||
Restricted (Non-vested) Stock
|
|
Number of Non-vested Shares
|
|
Wgtd. Avg. Grant Date Fair Value
|
|
Number of Non-vested Shares
|
|
Wgtd. Avg. Grant Date Fair Value
|
||||||
|
|
|
|
|
|
|
|
|
||||||
Outstanding, beginning of period
|
|
109,695
|
|
|
$
|
4.01
|
|
|
115,950
|
|
|
$
|
4.16
|
|
Granted
|
|
44,878
|
|
|
4.29
|
|
|
39,576
|
|
|
3.79
|
|
||
Vested
|
|
(40,107
|
)
|
|
4.11
|
|
|
(31,559
|
)
|
|
4.25
|
|
||
Shares withheld for payment of
taxes upon vesting of restricted stock |
|
(1,743
|
)
|
|
3.70
|
|
|
(1,825
|
)
|
|
4.27
|
|
||
Forfeited
|
|
(9,490
|
)
|
|
4.20
|
|
|
(12,447
|
)
|
|
4.03
|
|
||
Outstanding, end of period
|
|
103,233
|
|
|
$
|
4.08
|
|
|
109,695
|
|
|
$
|
4.01
|
|
|
|
|
|
|
|
|
|
|
||||||
For non-vested shares
|
|
|
|
|
|
|
|
|
|
|
|
|||
Expense not yet recognized (000s)
|
|
|
|
$
|
315
|
|
|
|
|
|
$
|
328
|
|
|
Weighted average remaining years for vesting
|
|
|
|
|
1.7
|
|
|
|
|
1.7
|
|
|||
|
|
|
|
|
|
|
|
|
||||||
For shares vested
|
|
|
|
|
|
|
|
|
|
|
|
|||
Aggregate fair value on vesting dates (000s)
|
|
|
|
|
$
|
187
|
|
|
|
|
|
$
|
123
|
|
|
|
Years Ended
|
||||||||||||
|
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||
Restricted Stock Units
|
|
Number of Non-vested Shares
|
|
Wgtd. Avg. Grant Date Fair Value
|
|
Number of Non-vested Shares
|
|
Wgtd. Avg. Grant Date Fair Value
|
||||||
|
|
|
|
|
|
|
|
|
||||||
Outstanding, beginning of period
|
|
267,999
|
|
|
$
|
4.03
|
|
|
112,809
|
|
|
$
|
4.64
|
|
Granted
|
|
102,864
|
|
|
4.28
|
|
|
155,190
|
|
|
3.58
|
|
||
Vested
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
|
(200,371
|
)
|
|
4.22
|
|
|
—
|
|
|
—
|
|
||
Outstanding, end of period
|
|
170,492
|
|
|
$
|
3.96
|
|
|
267,999
|
|
|
$
|
4.03
|
|
|
|
|
|
|
|
|
|
|
||||||
For non-vested shares
|
|
|
|
|
|
|
|
|
|
|
|
|||
Expense not yet recognized (000s)
|
|
|
|
$
|
352
|
|
|
|
|
|
$
|
329
|
|
|
Weighted average remaining years for vesting
|
|
|
|
|
2.3
|
|
|
|
|
2.0
|
|
|
|
Years Ended
|
||||||
Income Tax Provision
|
|
September 30, 2018
|
|
September 30, 2017
|
||||
(in thousands)
|
|
|
|
|
||||
Current tax:
|
|
|
|
|
||||
State
|
|
$
|
6
|
|
|
$
|
53
|
|
Federal
|
|
12
|
|
|
9
|
|
||
|
|
|
|
|
||||
Deferred tax:
|
|
|
|
|
||||
State
|
|
(103
|
)
|
|
—
|
|
||
Federal
|
|
5,088
|
|
|
—
|
|
||
Valuation allowance
|
|
(13,840
|
)
|
|
—
|
|
||
(Benefit)/provision for income taxes
|
|
$
|
(8,837
|
)
|
|
$
|
62
|
|
|
|
Years Ended
|
||||
Taxes as Percent of Pretax Income
|
|
September 30, 2018
|
|
September 30, 2017
|
||
|
|
|
|
|
||
Federal statutory rate
|
|
24.2
|
%
|
|
34.0
|
%
|
|
|
|
|
|
||
Decrease in valuation allowance
|
|
(880.0
|
)
|
|
(164.4
|
)
|
Deferred tax adjustment
|
|
(21.2
|
)
|
|
65.8
|
|
Decrease in state deferred tax rate
|
|
(6.6
|
)
|
|
—
|
|
State income taxes, net of federal benefit
|
|
0.4
|
|
|
26.8
|
|
Rate change due to Tax Reform
|
|
316.6
|
|
|
—
|
|
Stock-based compensation
|
|
7.3
|
|
|
57.6
|
|
Non-deductible expenses
|
|
0.6
|
|
|
23.5
|
|
Other
|
|
(3.2
|
)
|
|
—
|
|
|
|
|
|
|
||
Income tax provision as percent of pretax income
|
|
(561.9
|
)%
|
|
43.3
|
%
|
|
|
As of
|
||||||
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
(in thousands)
|
|
|
|
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Federal and state net operating loss carryforward
|
|
$
|
6,366
|
|
|
$
|
11,367
|
|
Alternative minimum tax credit carryforward
|
|
1,031
|
|
|
1,010
|
|
||
Depreciation and fixed assets
|
|
306
|
|
|
289
|
|
||
Amortization and impairment of intangibles
|
|
27
|
|
|
28
|
|
||
New York State investment tax and other credits
|
|
1,308
|
|
|
1,186
|
|
||
Inventories
|
|
382
|
|
|
585
|
|
||
Deferred gain on sale-leaseback
|
|
431
|
|
|
271
|
|
||
Other
|
|
312
|
|
|
412
|
|
||
Total before allowance
|
|
10,163
|
|
|
15,148
|
|
||
Valuation allowance
|
|
(1,308
|
)
|
|
(15,148
|
)
|
||
Deferred tax assets, net
|
|
$
|
8,855
|
|
|
$
|
—
|
|
|
|
Years Ended
|
||
% of Sales by Sector
|
|
September 30,
2018 |
|
September 30,
2017 |
|
|
|
|
|
Aerospace and Defense
|
|
59%
|
|
52%
|
Medical
|
|
22%
|
|
28%
|
Industrial
|
|
19%
|
|
20%
|
|
|
100%
|
|
100%
|
Capital Lease Payment Schedule
|
|
Contractual
Principal Payments |
||
(in thousands)
|
|
|
|
|
Twelve months ended September 30,
|
|
|
|
|
2019
|
|
$
|
658
|
|
2020
|
|
671
|
|
|
2021
|
|
685
|
|
|
2022
|
|
698
|
|
|
2023 and thereafter
|
|
7,413
|
|
|
Total capital lease payments
|
|
10,125
|
|
|
Less: amounts representing interest
|
|
(2,792
|
)
|
|
Present value of minimum lease payment
|
|
$
|
7,333
|
|
|
|
Years Ended
|
||||||
Earnings Per Share
|
|
September 30,
2018 |
|
September 30,
2017 |
||||
Basic net income per share:
|
|
|
|
|
||||
Net income
|
|
$
|
10,410
|
|
|
$
|
81
|
|
Less: Income attributable to non-vested shares
|
|
104
|
|
|
1
|
|
||
Net income available to common stockholders
|
|
$
|
10,306
|
|
|
$
|
80
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding
|
|
10,228,596
|
|
|
10,181,868
|
|
||
|
|
|
|
|
||||
Basic net income per share
|
|
$
|
1.01
|
|
|
$
|
0.01
|
|
|
|
|
|
|
||||
Diluted net income per share:
|
|
|
|
|
||||
Net income
|
|
$
|
10,410
|
|
|
$
|
81
|
|
|
|
|
|
|
||||
Shares used in computing basic net income per share
|
|
10,228,596
|
|
|
10,181,868
|
|
||
Dilutive effect of non-vested shares and options
|
|
91,607
|
|
|
—
|
|
||
Shares used in computing diluted net income per share
|
|
10,320,203
|
|
|
10,181,868
|
|
||
|
|
|
|
|
||||
Diluted net income per share
|
|
$
|
1.01
|
|
|
$
|
0.01
|
|
|
|
Years Ended
|
||||
|
|
September 30,
2018 |
|
September 30,
2017 |
||
Anti-dilutive shares excluded
|
|
32,788
|
|
|
855,836
|
|
|
|
Net Sales
|
|
Gross Profit
|
|
Net Income/(Loss)
|
|
Basic and Diluted Earnings/(Loss) Per Share
|
||||||||
(Unaudited; in thousands, except per share data)
|
|
|
|
|
||||||||||||
Fiscal Quarters
|
|
|
|
|
|
|
|
|
||||||||
Fourth 2018
|
|
$
|
34,216
|
|
|
$
|
4,496
|
|
|
$
|
9,121
|
|
(a)
|
$
|
0.89
|
|
Third 2018
|
|
29,782
|
|
|
3,359
|
|
|
204
|
|
|
0.02
|
|
||||
Second 2018
|
|
31,768
|
|
|
4,784
|
|
|
1,579
|
|
|
0.15
|
|
||||
First 2018
|
|
21,156
|
|
|
1,518
|
|
|
(494
|
)
|
|
(0.05
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Fourth 2017
|
|
$
|
27,623
|
|
|
$
|
3,475
|
|
|
$
|
755
|
|
|
$
|
0.07
|
|
Third 2017
|
|
26,489
|
|
|
3,708
|
|
|
794
|
|
|
0.08
|
|
||||
Second 2017
|
|
21,368
|
|
|
2,279
|
|
|
(603
|
)
|
|
(0.06
|
)
|
||||
First 2017
|
|
20,976
|
|
|
1,795
|
|
|
(865
|
)
|
|
(0.09
|
)
|
(a)
|
Fourth quarter 2018 was impacted by a $7.8 million income tax benefit recorded to release the majority of the valuation allowance against the net deferred income tax assets.
|
Item 9A.
|
CONTROLS AND PROCEDURES
|
(i)
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and asset dispositions of the Company;
|
(ii)
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
|
(iii)
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on financial statements.
|
Item 9B.
|
OTHER INFORMATION
|
Exhibit No.
|
Title
|
3.1
|
Amended and Restated Certificate of Incorporation of DFT Holdings Corp. (incorporated herein by reference from Exhibit 3.1 to the Company’s Registration Statement on Form S-1, Registration No. 33-56498)
|
3.2
|
Certificate of Ownership and Merger merging IEC Electronics Corp. into DFT Holdings Corp. (incorporated herein by reference from Exhibit 3.5 to the Company’s Registration Statement on Form S-1, Registration No. 33-56498)
|
3.3
|
Certificate of Amendment of the Certificate of Incorporation of IEC Electronics Corp. (incorporated herein by reference from Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 27, 1998)
|
3.4
|
|
3.5
|
|
3.6
|
|
10.1
|
|
10.2
|
|
10.3
|
|
10.4
|
|
10.5
|
|
10.6
|
|
10.7
|
|
10.8
|
|
10.9
|
10.10
|
|
10.11*
|
|
10.12*
|
|
10.13*
|
|
10.14*
|
|
10.15*
|
|
10.16*
|
|
10.17*
|
|
10.18*
|
|
10.19*
|
|
10.20*
|
|
10.21*
|
|
10.22*
|
|
10.23*
|
|
10.24*
|
|
10.25*
|
|
10.26*
|
|
10.27*
|
|
10.28*
|
|
10.29*
|
|
10.30*
|
|
10.31*
|
10.32*#
|
|
21.1#
|
|
23.1#
|
|
31.1#
|
|
31.2#
|
|
32.1#
|
|
101
|
The following items from this Annual Report on Form 10-K formatted in Extensible Business Reporting Language: (i) Consolidated Balance Sheets, (ii) Consolidated Income Statements, (iii) Consolidated Statements of Changes in Stockholders’ Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements.
|
|
|
IEC Electronics Corp.
|
|
|
(Registrant)
|
|
|
|
Dated: November 29, 2018
|
By:
|
/s/ Jeffrey T. Schlarbaum
|
|
|
Jeffrey T. Schlarbaum
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Signature
|
Title
|
Date
|
/s/ Jeffrey T. Schlarbaum
|
President and Chief Executive Officer
|
|
Jeffrey T. Schlarbaum
|
(Principal Executive Officer and Director)
|
November 29, 2018
|
|
|
|
/s/ Thomas L. Barbato
|
Senior Vice President and Chief Financial Officer
|
November 29, 2018
|
Thomas L. Barbato
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
/s/ Keith M. Butler
|
Director
|
November 29, 2018
|
Keith M. Butler
|
|
|
|
|
|
/s/ Charles P. Hadeed
|
Director
|
November 29, 2018
|
Charles P. Hadeed
|
|
|
|
|
|
/s/ Lynn J. Hartrick
|
Director
|
November 29, 2018
|
Lynn J. Hartrick
|
|
|
|
|
|
/s/ Andrew M. Laurence
|
Director
|
November 29, 2018
|
Andrew M. Laurence
|
|
|
|
|
|
/s/ Jeremy R. Nowak
|
Chairman of the Board
|
November 29, 2018
|
Jeremy R. Nowak
|
|
|
|
|
|
/s/ Michael Osborne
|
Director
|
November 29, 2018
|
Michael Osborne
|
|
|
Subsidiary
|
State of Incorporation
|
|
|
IEC Electronics Corp.-Albuquerque
|
New Mexico
|
|
|
IEC Analysis & Testing Laboratory, LLC
|
New Mexico
|
|
|
IEC California Holdings, Inc.
|
Delaware
|
1.
|
I have reviewed this Annual Report on Form 10-K for the
year ended
September 30, 2018
of IEC Electronics Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated: November 29, 2018
|
|
/s/ Jeffrey T. Schlarbaum
|
|
|
Jeffrey T. Schlarbaum
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Annual Report on Form 10-K for the
year ended
September 30, 2018
of IEC Electronics Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated: November 29, 2018
|
|
/s/ Thomas L. Barbato
|
|
|
Thomas L. Barbato
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Dated: November 29, 2018
|
|
/s/ Jeffrey T. Schlarbaum
|
|
|
Jeffrey T. Schlarbaum
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Dated: November 29, 2018
|
|
/s/ Thomas L. Barbato
|
|
|
Thomas L. Barbato
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|