Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
Massachusetts
(State or other jurisdiction
of incorporation or organization)
|
|
04-2882273
(I.R.S. Employer Identification No.)
|
Yes
þ
|
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No
o
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Yes
þ
|
|
No
o
|
Large accelerated filer
þ
|
|
Accelerated filer
o
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|
Non-accelerated filer
o
|
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Smaller reporting company
o
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Yes
o
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No
þ
|
|
PAGE
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ITEM 5.
(Removed and Reserved)
|
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EX-31.1
|
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EX-31.2
|
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EX-32.1
|
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EX-32.2
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EX-101 INSTANCE DOCUMENT
|
|
EX-101 SCHEMA DOCUMENT
|
|
EX-101 CALCULATION LINKBASE DOCUMENT
|
|
EX-101 LABELS LINKBASE DOCUMENT
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EX-101 PRESENTATION LINKBASE DOCUMENT
|
|
EX-101 DEFINITION LINKBASE DOCUMENT
|
|
Three Months Ended
|
||||||
|
June 28,
2014 |
|
June 29,
2013 |
||||
Net revenues
|
$
|
224,488
|
|
|
$
|
219,543
|
|
Cost of goods sold
|
118,210
|
|
|
108,131
|
|
||
Gross profit
|
106,278
|
|
|
111,412
|
|
||
Operating expenses:
|
|
|
|
||||
Research and development
|
15,382
|
|
|
11,209
|
|
||
Selling, general and administrative
|
92,562
|
|
|
106,811
|
|
||
Total operating expenses
|
107,944
|
|
|
118,020
|
|
||
Operating loss
|
(1,666
|
)
|
|
(6,608
|
)
|
||
Interest and other expense, net
|
(2,543
|
)
|
|
(2,641
|
)
|
||
Loss before benefit from income taxes
|
(4,209
|
)
|
|
(9,249
|
)
|
||
Income tax benefit
|
(560
|
)
|
|
(1,375
|
)
|
||
Net loss
|
$
|
(3,649
|
)
|
|
$
|
(7,874
|
)
|
|
|
|
|
||||
Net loss per share - basic
|
$
|
(0.07
|
)
|
|
$
|
(0.15
|
)
|
Net loss per share - diluted
|
$
|
(0.07
|
)
|
|
$
|
(0.15
|
)
|
|
|
|
|
||||
Weighted average shares outstanding
|
|
|
|
||||
Basic
|
51,741
|
|
|
51,231
|
|
||
Diluted
|
51,741
|
|
|
51,231
|
|
||
|
|
|
|
||||
Comprehensive loss
|
$
|
(4,495
|
)
|
|
$
|
(8,134
|
)
|
|
June 28,
2014 |
|
March 29,
2014 |
||||
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
139,943
|
|
|
$
|
192,469
|
|
Accounts receivable, less allowance of $1,865 at June 28, 2014 and $1,676 at March 29, 2014
|
156,733
|
|
|
164,603
|
|
||
Inventories, net
|
207,487
|
|
|
197,661
|
|
||
Deferred tax asset, net
|
14,173
|
|
|
14,144
|
|
||
Prepaid expenses and other current assets
|
50,969
|
|
|
54,099
|
|
||
Total current assets
|
569,305
|
|
|
622,976
|
|
||
Net property, plant and equipment
|
294,100
|
|
|
271,437
|
|
||
Intangible assets, less accumulated amortization of $110,030 at June 28, 2014 and $101,694 at March 29, 2014
|
264,560
|
|
|
271,159
|
|
||
Goodwill
|
337,237
|
|
|
336,768
|
|
||
Deferred tax asset, long term
|
1,119
|
|
|
1,184
|
|
||
Other long-term assets
|
10,410
|
|
|
10,654
|
|
||
Total assets
|
$
|
1,476,731
|
|
|
$
|
1,514,178
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Notes payable and current maturities of long-term debt
|
$
|
1,931
|
|
|
$
|
45,630
|
|
Accounts payable
|
55,213
|
|
|
53,562
|
|
||
Accrued payroll and related costs
|
49,495
|
|
|
54,913
|
|
||
Accrued income taxes
|
2,076
|
|
|
3,113
|
|
||
Other liabilities
|
57,153
|
|
|
59,710
|
|
||
Total current liabilities
|
165,868
|
|
|
216,928
|
|
||
Long-term debt, net of current maturities
|
429,010
|
|
|
392,057
|
|
||
Long-term deferred tax liability
|
28,366
|
|
|
29,664
|
|
||
Other long-term liabilities
|
38,415
|
|
|
37,641
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $0.01 par value; Authorized — 150,000,000 shares; Issued and outstanding — 51,430,080 shares at June 28, 2014 and 52,041,189 shares at March 29, 2014
|
514
|
|
|
520
|
|
||
Additional paid-in capital
|
404,686
|
|
|
402,611
|
|
||
Retained earnings
|
409,307
|
|
|
433,347
|
|
||
Accumulated other comprehensive income
|
565
|
|
|
1,410
|
|
||
Total stockholders’ equity
|
815,072
|
|
|
837,888
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,476,731
|
|
|
$
|
1,514,178
|
|
|
Three Months Ended
|
||||||
|
June 28,
2014 |
|
June 29,
2013 |
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net loss
|
$
|
(3,649
|
)
|
|
$
|
(7,874
|
)
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Non-cash items:
|
|
|
|
||||
Depreciation and amortization
|
20,511
|
|
|
18,357
|
|
||
Amortization of financing costs
|
347
|
|
|
427
|
|
||
Stock compensation expense
|
3,489
|
|
|
3,013
|
|
||
Loss on sale of property, plant and equipment
|
414
|
|
|
154
|
|
||
Unrealized loss from hedging activities
|
104
|
|
|
2,776
|
|
||
Contingent consideration expense
|
224
|
|
|
121
|
|
||
Asset write-down
|
261
|
|
|
327
|
|
||
Change in operating assets and liabilities:
|
|
|
|
||||
Decrease in accounts receivable, net
|
7,918
|
|
|
14,100
|
|
||
Increase in inventories
|
(9,569
|
)
|
|
(12,845
|
)
|
||
Increase in prepaid income taxes
|
(313
|
)
|
|
(4,727
|
)
|
||
(Decrease)/Increase in other assets and other liabilities
|
(589
|
)
|
|
6,110
|
|
||
Tax benefit of exercise of stock options
|
285
|
|
|
840
|
|
||
Decrease in accounts payable and accrued expenses
|
(5,695
|
)
|
|
(7,377
|
)
|
||
Net cash provided by operating activities
|
13,738
|
|
|
13,402
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital expenditures on property, plant and equipment
|
(37,085
|
)
|
|
(13,092
|
)
|
||
Proceeds from sale of property, plant and equipment
|
64
|
|
|
569
|
|
||
Acquisition of Hemerus
|
—
|
|
|
(23,124
|
)
|
||
Net cash used in investing activities
|
(37,021
|
)
|
|
(35,647
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Payments on long-term real estate mortgage
|
(254
|
)
|
|
(233
|
)
|
||
Net increase in short-term loans
|
1,687
|
|
|
262
|
|
||
Repayment of term loan borrowings
|
(8,531
|
)
|
|
—
|
|
||
Proceeds from employee stock purchase plan
|
2,530
|
|
|
2,666
|
|
||
Proceeds from exercise of stock options
|
2,223
|
|
|
5,849
|
|
||
Excess tax benefit on exercise of stock options
|
—
|
|
|
960
|
|
||
Share repurchases
|
(26,466
|
)
|
|
—
|
|
||
Net cash (used in)/provided by financing activities
|
(28,811
|
)
|
|
9,504
|
|
||
Effect of exchange rates on cash and cash equivalents
|
(432
|
)
|
|
(51
|
)
|
||
Net Decrease in Cash and Cash Equivalents
|
(52,526
|
)
|
|
(12,792
|
)
|
||
Cash and Cash Equivalents at Beginning of Period
|
192,469
|
|
|
179,120
|
|
||
Cash and Cash Equivalents at End of Period
|
$
|
139,943
|
|
|
$
|
166,328
|
|
Non-cash Investing and Financing Activities:
|
|
|
|
||||
Transfers from inventory to fixed assets for placements of Haemonetics equipment
|
$
|
2,443
|
|
|
$
|
3,357
|
|
Supplemental Disclosures of Cash Flow Information:
|
|
|
|
||||
Interest paid
|
$
|
2,011
|
|
|
$
|
2,401
|
|
Income taxes paid
|
$
|
2,097
|
|
|
$
|
906
|
|
|
|
Three Months Ended
|
||||||
(In thousands, except per share amounts)
|
|
June 28,
2014 |
|
June 29,
2013 |
||||
Basic EPS
|
|
|
|
|
||||
Net loss
|
|
$
|
(3,649
|
)
|
|
$
|
(7,874
|
)
|
Weighted average shares
|
|
51,741
|
|
|
51,231
|
|
||
Basic loss per share
|
|
$
|
(0.07
|
)
|
|
$
|
(0.15
|
)
|
Diluted EPS
|
|
|
|
|
||||
Net loss
|
|
$
|
(3,649
|
)
|
|
$
|
(7,874
|
)
|
Basic weighted average shares
|
|
51,741
|
|
|
51,231
|
|
||
Net effect of common stock equivalents
|
|
—
|
|
|
—
|
|
||
Diluted weighted average shares
|
|
51,741
|
|
|
51,231
|
|
||
Diluted loss per share
|
|
$
|
(0.07
|
)
|
|
$
|
(0.15
|
)
|
|
|
Three Months Ended
|
||||
|
|
June 28,
2014 |
|
June 29,
2013 |
||
Stock Options Black-Scholes assumptions (weighted average):
|
|
|
|
|
||
Volatility
|
|
22.62
|
%
|
|
26.22
|
%
|
Expected life (years)
|
|
4.9
|
|
|
5.0
|
|
Risk-free interest rate
|
|
1.64
|
%
|
|
1.41
|
%
|
Dividend yield
|
|
—
|
%
|
|
—
|
%
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
||||
Warranty accrual as of the beginning of the period
|
|
$
|
590
|
|
|
$
|
673
|
|
Warranty provision
|
|
75
|
|
|
385
|
|
||
Warranty spending
|
|
(154
|
)
|
|
(372
|
)
|
||
Warranty accrual as of the end of the period
|
|
$
|
511
|
|
|
$
|
686
|
|
(In thousands)
|
|
June 28,
2014 |
|
March 29,
2014 |
||||
Raw materials
|
|
$
|
74,464
|
|
|
$
|
72,508
|
|
Work-in-process
|
|
6,638
|
|
|
7,383
|
|
||
Finished goods
|
|
126,385
|
|
|
117,770
|
|
||
|
|
$
|
207,487
|
|
|
$
|
197,661
|
|
Derivative Instruments
|
|
Amount of
Gain/(Loss)
Recognized in AOCI
(Effective Portion)
|
|
Amount of Gain/(Loss) Reclassified
from AOCI into Earnings
(Effective Portion)
|
|
Location in
Consolidated Statements of
Income and Comprehensive Income
|
|
Amount of Gain/(Loss)
Excluded from Effectiveness
Testing (*)
|
|
Location in
Consolidated Statements of Income and Comprehensive Income |
||||||
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
||||||
Designated foreign currency hedge contracts, net of tax
|
|
$
|
(148
|
)
|
|
$
|
793
|
|
|
Net revenues, COGS, and SG&A
|
|
$
|
83
|
|
|
Interest and other expense, net
|
Non-designated foreign currency hedge contracts
|
|
—
|
|
|
—
|
|
|
|
|
(88
|
)
|
|
Interest and other expense, net
|
|||
Designated interest rate swaps, net of tax
|
|
$
|
559
|
|
|
$
|
—
|
|
|
Interest and other expense, net
|
|
$
|
—
|
|
|
|
(In thousands)
|
|
Location in
Balance Sheet
|
|
June 28, 2014
|
|
March 29, 2014
|
||||
Derivative Assets:
|
|
|
|
|
|
|
||||
Designated foreign currency hedge contracts
|
|
Other current assets
|
|
$
|
1,401
|
|
|
$
|
2,574
|
|
Designated interest rate swaps
|
|
Other current assets
|
|
353
|
|
|
1,250
|
|
||
|
|
|
|
$
|
1,754
|
|
|
$
|
3,824
|
|
Derivative Liabilities:
|
|
|
|
|
|
|
||||
Designated foreign currency hedge contracts
|
|
Other current liabilities
|
|
$
|
673
|
|
|
$
|
1,255
|
|
|
|
|
|
$
|
673
|
|
|
$
|
1,255
|
|
•
|
Level 1 — Inputs to the valuation methodology are quoted market prices for identical assets or liabilities.
|
•
|
Level 2 — Inputs to the valuation methodology are other observable inputs, including quoted market prices for similar assets or liabilities and market-corroborated inputs.
|
•
|
Level 3 — Inputs to the valuation methodology are unobservable inputs based on management’s best estimate of inputs market participants would use in pricing the asset or liability at the measurement date, including assumptions about risk.
|
(In thousands)
|
|
Quoted Market
Prices for Identical Assets
(Level 1)
|
|
Significant
Other Observable Inputs
(Level 2)
|
|
Significant
Unobservable Inputs
(Level 3)
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
|
$
|
95,662
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
95,662
|
|
Designated foreign currency hedge contracts
|
|
—
|
|
|
1,401
|
|
|
—
|
|
|
1,401
|
|
||||
Designated interest rate swap
|
|
—
|
|
|
353
|
|
|
—
|
|
|
353
|
|
||||
|
|
$
|
95,662
|
|
|
$
|
1,754
|
|
|
$
|
—
|
|
|
$
|
97,416
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Designated foreign currency hedge contracts
|
|
$
|
—
|
|
|
$
|
673
|
|
|
$
|
—
|
|
|
$
|
673
|
|
Contingent consideration
|
|
—
|
|
|
—
|
|
|
7,870
|
|
|
7,870
|
|
||||
|
|
$
|
—
|
|
|
$
|
673
|
|
|
$
|
7,870
|
|
|
$
|
8,543
|
|
(In thousands)
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||
Contingent consideration as of March 29, 2014
|
|
7,645
|
|
|
Contingent consideration interest expense
|
|
225
|
|
|
Ending balance
|
|
$
|
7,870
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
||||
Disposable revenues
|
|
|
|
|
||||
Plasma disposables
|
|
$
|
79,227
|
|
|
$
|
65,336
|
|
Blood center disposables
|
|
|
|
|
||||
Platelet
|
|
38,170
|
|
|
34,446
|
|
||
Red cell
|
|
10,246
|
|
|
10,009
|
|
||
Whole blood
|
|
37,950
|
|
|
51,254
|
|
||
|
|
86,366
|
|
|
95,709
|
|
||
Hospital disposables
|
|
|
|
|
||||
Surgical
|
|
15,621
|
|
|
16,089
|
|
||
OrthoPAT
|
|
5,381
|
|
|
6,320
|
|
||
Diagnostics
|
|
9,598
|
|
|
7,594
|
|
||
|
|
30,600
|
|
|
30,003
|
|
||
Total disposables revenue
|
|
196,193
|
|
|
191,048
|
|
||
|
|
|
|
|
||||
Software solutions
|
|
17,738
|
|
|
16,746
|
|
||
Equipment & other
|
|
10,557
|
|
|
11,749
|
|
||
Net revenues
|
|
$
|
224,488
|
|
|
$
|
219,543
|
|
|
|
|
|
Three Months Ended June 28, 2014
|
|||||||||||||||||||
(In thousands)
|
|
Restructuring Accrual Balance at March 29, 2014
|
|
Restructuring Costs Incurred
|
|
Less Payments
|
|
Less Non-Cash Adjustments
|
|
Restructuring Accrual Balance at June 28, 2014
|
||||||||||
Severance and other employee costs
|
|
$
|
22,908
|
|
|
$
|
9,542
|
|
|
$
|
(7,133
|
)
|
|
$
|
—
|
|
|
$
|
25,317
|
|
Other costs
|
|
728
|
|
|
5,167
|
|
|
(5,493
|
)
|
|
—
|
|
|
402
|
|
|||||
Accelerated depreciation
|
|
—
|
|
|
260
|
|
|
—
|
|
|
(260
|
)
|
|
—
|
|
|||||
Asset write-down
|
|
—
|
|
|
96
|
|
|
—
|
|
|
(96
|
)
|
|
—
|
|
|||||
Total
|
|
$
|
23,636
|
|
|
$
|
15,065
|
|
|
$
|
(12,626
|
)
|
|
$
|
(356
|
)
|
|
$
|
25,719
|
|
|
Three Months Ended June 29, 2013
|
|||||||||||||||||||
(in thousands)
|
|
Restructuring Accrual Balance at March 30, 2013
|
|
Restructuring Costs Incurred
|
|
Less Payments
|
|
Less Non-Cash Adjustments
|
|
Restructuring Accrual Balance at June 29, 2013
|
||||||||||
Severance and other employee costs
|
|
$
|
3,089
|
|
|
$
|
20,039
|
|
|
$
|
(1,969
|
)
|
|
$
|
—
|
|
|
$
|
21,159
|
|
Other costs
|
|
173
|
|
|
3,103
|
|
|
(1,490
|
)
|
|
—
|
|
|
1,786
|
|
|||||
Asset write-down
|
|
—
|
|
|
327
|
|
|
—
|
|
|
(327
|
)
|
|
—
|
|
|||||
|
|
$
|
3,262
|
|
|
$
|
23,469
|
|
|
$
|
(3,459
|
)
|
|
$
|
(327
|
)
|
|
$
|
22,945
|
|
Transformation costs
|
|
Three Months Ended
|
||||||
(in thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
||||
Integration and other costs
|
|
7,678
|
|
|
9,180
|
|
||
Accelerated depreciation
|
|
250
|
|
|
843
|
|
||
Total
|
|
$
|
7,928
|
|
|
$
|
10,023
|
|
Restructuring costs
|
|
Three Months Ended
|
||||||
(in thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
||||
Severance and other employee costs
|
|
$
|
9,542
|
|
|
$
|
20,039
|
|
Other costs
|
|
5,167
|
|
|
2,849
|
|
||
Accelerated depreciation
|
|
260
|
|
|
254
|
|
||
Asset disposal
|
|
96
|
|
|
327
|
|
||
Total
|
|
$
|
15,065
|
|
|
$
|
23,469
|
|
|
|
|
|
|
||||
Total restructuring and transformation
|
|
$
|
22,993
|
|
|
$
|
33,492
|
|
(In thousands)
|
|
Foreign currency
|
|
Defined benefit plans
|
|
Net Unrealized Gain/loss on Derivatives
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Balance as of March 29, 2014
|
|
$
|
3,198
|
|
|
$
|
(4,592
|
)
|
|
$
|
2,804
|
|
|
$
|
1,410
|
|
Other comprehensive income (loss) before reclassifications
|
|
955
|
|
|
(595
|
)
|
|
(411
|
)
|
|
(51
|
)
|
||||
Amounts reclassified from Accumulated Other Comprehensive Income
|
|
—
|
|
|
—
|
|
|
(794
|
)
|
|
(794
|
)
|
||||
Net current period other comprehensive income
|
|
955
|
|
|
(595
|
)
|
|
(1,205
|
)
|
|
(845
|
)
|
||||
Balance as of June 28, 2014
|
|
$
|
4,153
|
|
|
$
|
(5,187
|
)
|
|
$
|
1,599
|
|
|
$
|
565
|
|
(In thousands)
|
|
Amounts Reclassified from Other Comprehensive Income
|
|
Affected Line in the
Statement of Income
|
||
Derivative instruments reclassified to income statement
|
|
|
|
|
||
Realized net gain on derivatives
|
|
$
|
789
|
|
|
Revenue, cost of goods sold, income/(expense)
|
Income tax effect
|
|
5
|
|
|
Provision for income taxes
|
|
Net of taxes
|
|
$
|
794
|
|
|
|
($ in millions)
|
|
Original Credit Facility
|
|
Amended Credit Facility
|
||||
Term Loan Outstanding at June 30, 2014
|
|
$
|
429.4
|
|
|
$
|
379.4
|
|
Term Loan Maturity Date
|
|
August 1, 2017
|
|
|
July 1, 2019
|
|
||
Revolving Credit Facility Limit
|
|
$
|
50.0
|
|
|
$
|
100.0
|
|
Revolving Credit Facility Drawn
|
|
$
|
—
|
|
|
$
|
50.0
|
|
Interest Rate
|
|
LIBOR + 1.125% - 1.500%
|
|
|
LIBOR + 1.125% - 1.500%
|
|
Fiscal year
(in thousands)
|
|
Term Loan
|
||
2015
|
|
$
|
—
|
|
2016
|
|
14,227
|
|
|
2017
|
|
37,941
|
|
|
2018
|
|
73,510
|
|
|
2019 and beyond
|
|
303,728
|
|
|
|
|
$
|
429,406
|
|
•
|
Purchase and consumption of a minimum level of disposables products;
|
•
|
Payment of monthly rental fees; and
|
•
|
An asset utilization performance metric, such as performing a minimum level of procedures per month per device.
|
|
|
Three Months Ended
|
|||||||||
(In thousands, except per share data)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
% Increase/
(Decrease) |
|||||
Net revenues
|
|
$
|
224,488
|
|
|
$
|
219,543
|
|
|
2.3
|
%
|
Gross profit
|
|
$
|
106,278
|
|
|
$
|
111,412
|
|
|
(4.6
|
)%
|
% of net revenues
|
|
47.3
|
%
|
|
50.7
|
%
|
|
|
|||
Operating expenses
|
|
$
|
107,944
|
|
|
$
|
118,020
|
|
|
(8.5
|
)%
|
Operating loss
|
|
$
|
(1,666
|
)
|
|
$
|
(6,608
|
)
|
|
(74.8
|
)%
|
% of net revenues
|
|
(0.7
|
)%
|
|
(3.0
|
)%
|
|
|
|||
Interest and other expense, net
|
|
$
|
(2,543
|
)
|
|
$
|
(2,641
|
)
|
|
(3.7
|
)%
|
Loss before benefit from income taxes
|
|
$
|
(4,209
|
)
|
|
$
|
(9,249
|
)
|
|
(54.5
|
)%
|
Income tax benefit
|
|
$
|
(560
|
)
|
|
$
|
(1,375
|
)
|
|
(59.3
|
)%
|
% of pre-tax income
|
|
13.3
|
%
|
|
14.9
|
%
|
|
|
|||
Net loss
|
|
$
|
(3,649
|
)
|
|
$
|
(7,874
|
)
|
|
(53.7
|
)%
|
% of net revenues
|
|
(1.6
|
)%
|
|
(3.6
|
)%
|
|
|
|||
Earnings per share-diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.15
|
)
|
|
(53.3
|
)%
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
% Increase/
(Decrease) |
|||||
United States
|
|
$
|
120,749
|
|
|
$
|
122,145
|
|
|
(1.1
|
)%
|
International
|
|
103,739
|
|
|
97,398
|
|
|
6.5
|
%
|
||
Net revenues
|
|
$
|
224,488
|
|
|
$
|
219,543
|
|
|
2.3
|
%
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
% Increase/
(Decrease) |
|||||
Disposables
|
|
$
|
196,193
|
|
|
$
|
191,048
|
|
|
2.7
|
%
|
Software solutions
|
|
17,738
|
|
|
16,746
|
|
|
5.9
|
%
|
||
Equipment & other
|
|
10,557
|
|
|
11,749
|
|
|
(10.1
|
)%
|
||
Net revenues
|
|
$
|
224,488
|
|
|
$
|
219,543
|
|
|
2.3
|
%
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
% Increase/
(Decrease) |
|||||
Plasma disposables
|
|
$
|
79,227
|
|
|
$
|
65,336
|
|
|
21.3
|
%
|
Blood center disposables
|
|
|
|
|
|
|
|||||
Platelet
|
|
38,170
|
|
|
34,446
|
|
|
10.8
|
%
|
||
Red cell
|
|
10,246
|
|
|
10,009
|
|
|
2.4
|
%
|
||
Whole blood
|
|
37,950
|
|
|
51,254
|
|
|
(26.0
|
)%
|
||
|
|
86,366
|
|
|
95,709
|
|
|
(9.8
|
)%
|
||
Hospital disposables
|
|
|
|
|
|
|
|||||
Surgical
|
|
15,621
|
|
|
16,089
|
|
|
(2.9
|
)%
|
||
OrthoPAT
|
|
5,381
|
|
|
6,320
|
|
|
(14.9
|
)%
|
||
Diagnostics
|
|
9,598
|
|
|
7,594
|
|
|
26.4
|
%
|
||
|
|
30,600
|
|
|
30,003
|
|
|
2.0
|
%
|
||
Total disposables revenue
|
|
$
|
196,193
|
|
|
$
|
191,048
|
|
|
2.7
|
%
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
% Increase/
(Decrease) |
|||||
Gross profit
|
|
$
|
106,278
|
|
|
$
|
111,412
|
|
|
(4.6
|
)%
|
% of net revenues
|
|
47.3
|
%
|
|
50.7
|
%
|
|
|
|
|
|
Three Months Ended
|
|||||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
% Increase/
(Decrease)
|
|||||
Research and development
|
|
$
|
15,382
|
|
|
$
|
11,209
|
|
|
37.2
|
%
|
% of net revenues
|
|
6.9
|
%
|
|
5.1
|
%
|
|
|
|
||
Selling, general and administrative
|
|
$
|
92,562
|
|
|
$
|
106,811
|
|
|
(13.3
|
)%
|
% of net revenues
|
|
41.2
|
%
|
|
48.7
|
%
|
|
|
|
||
Total operating expenses
|
|
$
|
107,944
|
|
|
$
|
118,020
|
|
|
(8.5
|
)%
|
% of net revenues
|
|
48.1
|
%
|
|
53.8
|
%
|
|
|
|
|
|
Three Months Ended
|
||||
|
|
June 28,
2014 |
|
June 29,
2013 |
||
Reported income tax rate
|
|
13.3
|
%
|
|
14.9
|
%
|
(Dollars in thousands)
|
|
June 28,
2014 |
|
March 29,
2014 |
||||
Cash & cash equivalents
|
|
$
|
139,943
|
|
|
$
|
192,469
|
|
Working capital
|
|
$
|
403,437
|
|
|
$
|
406,048
|
|
Current ratio
|
|
3.4
|
|
|
2.9
|
|
||
Net debt (1)
|
|
$
|
(290,998
|
)
|
|
$
|
(245,218
|
)
|
Days sales outstanding (DSO)
|
|
63
|
|
|
62
|
|
||
Disposable finished goods inventory turnover
|
|
4.0
|
|
|
4.2
|
|
(1)
|
Net debt position is the sum of cash and cash equivalents less total debt.
|
Fiscal year
(in thousands)
|
|
Term Loan
|
||
2015
|
|
$
|
—
|
|
2016
|
|
14,227
|
|
|
2017
|
|
37,941
|
|
|
2018
|
|
73,510
|
|
|
2019 and beyond
|
|
303,728
|
|
|
|
|
$
|
429,406
|
|
|
|
Three Months Ended
|
||||||||||
(In thousands)
|
|
June 28,
2014 |
|
June 29,
2013 |
|
Increase/
(Decrease) |
||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
13,738
|
|
|
$
|
13,402
|
|
|
$
|
336
|
|
Investing activities
|
|
(37,021
|
)
|
|
(35,647
|
)
|
|
(1,374
|
)
|
|||
Financing activities
|
|
(28,811
|
)
|
|
9,504
|
|
|
(38,315
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents (1)
|
|
(432
|
)
|
|
(51
|
)
|
|
(381
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
$
|
(52,526
|
)
|
|
$
|
(12,792
|
)
|
|
$
|
(39,734
|
)
|
(1)
|
The balance sheet is affected by spot exchange rates used to translate local currency amounts into U.S. Dollars. In accordance with US GAAP, we have removed the effect of foreign currency throughout our cash flow statement, except for its effect on our cash and cash equivalents.
|
Period
|
|
Total Number
of Shares Repurchased |
|
Average Price
Paid per Share including Commissions |
|
Total Dollar Value
of Shares Purchased as Part of Publicly Announced Plans or Programs |
|
Maximum Dollar
Value of Shares that May Yet be Purchased Under the Plans or Programs |
||||||
4/27/2014-5/24/2014
|
|
694,162
|
|
|
$
|
31.81
|
|
|
22,079,008
|
|
|
77,920,992
|
|
|
5/25/2014-6/28/2014
|
|
139,595
|
|
|
34.23
|
|
|
4,778,988
|
|
|
73,142,004
|
|
||
Total
|
|
833,757
|
|
|
$
|
32.21
|
|
|
$
|
26,857,996
|
|
|
|
10A
|
|
Sixth Amendment to Lease dated March 23, 2004, effective July 15, 2004 made as of May 28, 2013 between Cabot II - ILI W02-W03, LLC and the Company of the property located in Niles, Illinois (filed as Exhibit 10A to the Company's Form 10-Q for the quarter ended June 28, 2014).
|
|
|
|
10B
|
|
Seventh Amendment to Lease dated March 23, 2004, effective July 15, 2004 made as of May 1, 2014 between Cabot II - ILI W02-W03, LLC and the Company of the property located in Niles, Illinois (filed as Exhibit 10B to the Company's Form 10-Q for the quarter ended June 28, 2014).
|
|
|
|
10C
|
|
Lease dated February 25, 2014 between and among 840 Business Center #2, LLC and Haemonetics Corporation for the property located in Mount Juliet, Tennessee (filed herewith as Exhibit 10C to the Company's Form 10-Q for the quarter ended June 28, 2014).
|
|
|
|
10D
|
|
Lease dated September 19, 2013 between the Penang Development Corporation ("Lessor") and Haemonetics Malaysia Sdn Bhd ("Lessee") of the property located in Penang, Malaysia (filed herewith as Exhibit 10D to the Company's 10-Q for the quarter ended June 28, 2014).
|
|
|
|
31.1
|
|
Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002, of Brian Concannon, President and Chief Executive Officer of the Company
|
|
|
|
31.2
|
|
Certification pursuant to Section 302 of Sarbanes-Oxley of 2002, of Christopher Lindop, Chief Financial Officer and Executive Vice President Business Development of the Company
|
|
|
|
32.1
|
|
Certification Pursuant to 18 United States Code Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Brian Concannon, President and Chief Executive Officer of the Company
|
|
|
|
32.2
|
|
Certification Pursuant to 18 United States Code Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Christopher Lindop, Chief Financial Officer and Executive Vice President Business Development of the Company
|
|
|
|
101*
|
|
The following materials from Haemonetics Corporation on Form 10-Q for the quarter ended June 28, 2014, formatted in Extensible Business Reporting Language (XBRL); (i) Consolidated Statements of Income and Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements.
|
*
|
|
In accordance with Rule 406T of Regulation S-T, the XBRL-related information in Exhibit 101 to this Form 10-Q is deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act, is deemed not filed for the purposes of section 18 of the Exchange Act, and otherwise is not subject to liability under these sections.
|
|
HAEMONETICS CORPORATION
|
|
|
July 31, 2014
|
By:
|
/s/ Brian Concannon
|
|
|
|
Brian Concannon, President and
Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
July 31, 2014
|
By:
|
/s/ Christopher Lindop
|
|
|
|
Christopher Lindop, Chief Financial
Officer and Executive Vice President Business Development
|
|
|
|
(Principal Financial Officer)
|
|
By:
|
Cabot Industrial Value Fund II Operating Partnership, L.P., a Delaware limited partnership, its sole member
|
Period
|
Monthly Base Rent
|
Annual Base Rent
|
8/1/14 – 7/31/15
|
$14,654.50
|
$175,854.00
|
8/1/15 – 7/31/16
|
$15,352.33
|
$184,227.96
|
8/1/16 – 7/31/17
|
$16,050.17
|
$192,602.04
|
By:
|
Cabot Industrial Value Fund II Operating Partnership, L.P., a Delaware limited partnership, its sole member
|
Period
|
Annual Minimum Rent/Square Foot
|
Annual Minimum Rent
|
Monthly Minimum Rent
|
Months 1 through 4
|
$0.00
|
$0.00
|
$0.00
|
Months 5 through 16
|
$0.00
|
$0.00
|
$0.00
|
Months 17 through 28
|
$0.00
|
$0.00
|
$0.00
|
Months 29 through 40
|
$0.00
|
$0.00
|
$0.00
|
Months 41 through 52
|
$0.00
|
$0.00
|
$0.00
|
Months 53 through 64
|
$0.00
|
$0.00
|
$0.00
|
Months 65 through 76
|
$0.00
|
$0.00
|
$0.00
|
Months 77 through 88
|
$0.00
|
$0.00
|
$0.00
|
Months 89 through 100
|
$0.00
|
$0.00
|
$0.00
|
Months 101 through 112
|
$0.00
|
$0.00
|
$0.00
|
Months 113 through 124
|
$0.00
|
$0.00
|
$0.00
|
(1)
|
PENANG DEVELOPMENT CORPORATION
a body corporate incorporated pursuant to the
Penang Development Corporation Enactment 1971
and having its office at Bangunan Tun Dr. Lim Chong Eu, No. 1 Pesiaran Mahsuri Bandar Bayan Baru 11909 Bayan Lepas Pulau Pinang (“the Lessor”) of the one part;
|
(2)
|
HAEMONETICS MALAYSIA SDN BHD
(Company No.: 1055910-U),
a company incorporated in Malaysia under the Companies Act, 1965 and having its registered address at Level 6.03, Menara Keck Seng, 203 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia
(“the Lessee”) of the other part.
|
1
|
The State Authority of Penang (hereinafter called “the State Authority”) has, pursuant to the Land Acquisition Act 1960, acquired the Land and the State Authority has agreed in due course to alienate the Land to the Lessor in accordance with the National Land Code, 1965 (“NLC”) for a term of sixty (60) years under Qualified Title and ultimately to be held under a State lease subject to the category of land use, the express conditions and restrictions in interest as stated therein;
|
2
|
The Lessee wishes to take from PDC a lease of the Land before such alienation and the Lessor has agreed to grant and the Lessee has agreed to accept the lease of the Land upon the terms and conditions hereinafter appearing; and
|
3
|
The Lessee has agreed to take a registrable lease for a term of thirty (30) years commencing from the date of this Agreement with vacant possession but subject to the category of land use, the express conditions and the restrictions in the Qualified Title as stated therein upon its issuance, all conditions and restrictions implied by the NLC and upon the terms and conditions herein contained.
|
1.1.1
|
“Affiliate” means
a company or legal entity which, (i) Controls, directly or
|
1.1.2
|
“Appropriate Authority” means any governmental, semi or quasigovernmental and or statutory department, agency or body invested with or exercising lawful authority;
|
1.1.3
|
“Authorised Use” means such use of the Land more particularly described in Section 7 of the First Schedule hereto as shall be authorised under this Agreement;
|
1.1.4
|
“the Land” means all the lands more particularly described in Section 4 of the First Schedule hereto;
|
1.1.7
|
“the Prescribed Rate” being the rate stated in Section 8 of the First Schedule hereto;
|
1.1.8
|
“the Lease Consideration” means the consideration payable by the Lessee to the Lessor in respect of the Land as stated in Section 5 of the First Schedule hereto;
|
1.1.9
|
“the Lessee” means
HAEMONETICS MALAYSIA SDN BHD (Company No.: 1055910-U), having its registered address at Level 6.03, Menara Keck Seng, 203 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia,
and shall include
its successors-in-title;
|
1.1.11
|
“the Initial Sum” means the sum stated in Section 6(i) of the First Schedule hereto; and
|
1.1.12
|
“the Term” means the term stated in Section 3 of the First Schedule hereto.
|
2.1
|
In consideration of the mutual covenants herein, the Lessor hereby agrees to grant and the Lessee agrees to accept a lease of the Land, subject to the Exceptions and Reservations set out in the Second Schedule hereto, to be held by the Lessee for the Term as set out in Section 3 of the First Schedule and paying therefor to the Lessor the Lease Consideration as set out in Section 5 of the First Schedule and upon the terms and conditions contained herein.
|
2.2
|
The Lease Consideration shall be paid by the Lessee to the Lessor in the manner as set out in Section 6 of the First Schedule hereto.
|
2.3
|
The Lessee hereby acknowledges that upon the approval of alienation of the Land and the issuance of the Qualified Title in the Lessor’s name, the Lessor shall be the registered legal owner of the Land and the Lessor shall recognize the rights attached to the lease right held by the Lessee according to the laws of Malaysia. In its capacity as the registered legal owner of the Land, the Lessor shall have the right to enter and inspect the Land during the Term provided that there is a reasonable notice given and at reasonable frequency (without materially affecting the operation and activities of the Lessee). However subject to terms and conditions of this Agreement, the Lessee shall be entitled to quiet and peaceful enjoyment of the Land in its capacity as the Lessee and eventually as the registered Lessee as envisaged under this Agreement. The Lessee further covenants with and represents and warrants to the Lessor and the State Authority that the Lessee shall not at any time whatsoever whether during or after the continuance of the Term, deny that the Lessor has full capacity and or right, title or interest in all respects to enter into and or enforce this Agreement nor raise any objection or inquiry in respect of the Lessor’s title to the Land.
|
2.4
|
The parties hereby agree that this Agreement is conditional upon the fulfillment of the following conditions:
|
2.4.1
|
the Lessor to procure alienation approval for the Land in its favour within the period of thirty (30) days from the date of this Agreement; and
|
2.4.2
|
the Lessor to procure the consent from the State Authority to lease the Land in favour of the Lessee within fifteen (15) days from the fulfillment of the condition under Clause 2.4.1 above.
|
2.5
|
In the event that the alienation of the Land to the Lessor and/or the consent to lease the Land to the Lessee is not approved by the State Authority within the period described
|
2.5.1
|
In the event the Lessor still fail to procure alienation of the Land and/or the consent to lease the Land within the Extended Period, the Lessee shall have the option to terminate this Agreement within a period of fourteen (14) days thereof, failing which the period for the Lessor to obtain alienation approval of the Land or the consent to lease the Land shall be deemed to be extended by a further period of one (1) month.
|
2.5.2
|
In the event the Lessee exercises the option to terminate the Agreement or the Lessor still fail to procure the alienation of the Land and/or the consent to lease the Land within the said period of one (1) month:
|
2.5.2.1
|
the Lessee shall forthwith deliver possession of the Land to the Lessor (whether or not any building shall then have been completely or partially erected on the Land and for the avoidance of doubt it is hereby declared that no compensation whatsoever shall be payable by the Lessor in respect of such building); and
|
2.5.2.2
|
the Lessor shall within thirty (30) days from the delivery of possession of the Land under Clause 2.5.2.1 above, refund without interest to the Lessee and/or the financier all monies paid by the Lessee and/or the financier towards the Lease Consideration.
|
2.6
|
The last date of the fulfillment of the last condition under Clause 2.4 shall be referred to as the “Unconditional Date”. The Lessor shall, within seven (7) days from its receipt of notice from the relevant authority informing the Lessor of the fulfillment of the conditions under Clause 2.4 above, notify the Lessee in writing the satisfaction of the conditions and the impending Unconditional Date.
|
2.7
|
The parties also acknowledge that upon the execution of this Agreement, the Lessee shall have the right to conduct a survey, at its own cost and expense, in order to ascertain the condition of the Land. The Lessee shall conduct and complete the survey on or before the 15
th
October 2013. In the event the survey reveals that the condition of the Land is found to be different from its condition as herein described, the Lessee shall have the right to terminate this Agreement and all monies paid by the Lessee shall be refunded by the Lessor.
|
3.1
|
Upon the Unconditional Date, the issuance of the Qualified Title to the Land and provided that there shall not, at any relevant time, be existing any default or breach by the Lessee of any of the terms and conditions of this Agreement, the parties hereto shall create and register a lease of the Land for such term as shall then be remaining on the Term upon the same terms and conditions as set out herein and this Agreement shall be annexed and form the annexure to the lease instrument in Form 15A of the NLC (“Form 15A”) (or such other form as shall then be applicable) in the following manner:
|
3.1.1
|
The Lessor or its solicitors shall have first notified the Lessee or its solicitors on the issuance of the Qualified Title in respect of the Land and the State Authority’s consent to the lease;
|
3.1.2
|
The Lessee, upon receipt of the aforesaid notification from the Lessor shall promptly prepare or instruct its solicitors to prepare and forward to the Lessor Form 15A (or such other form as shall then be applicable) duly executed by the Lessee for the Lessor’s execution;
|
3.1.3
|
The Lessor or its solicitors shall then forward the executed Form 15A together with this Agreement annexed thereto, original document of title of the Land and the State Authority’s consent document (hereinafter collectively referred to as “the Lease Instrument”), to the Lessee or its solicitors within fourteen (14) working days from the receipt of the executed Form 15A from the Lessee or its solicitors;
|
3.1.4
|
Upon receipt of the Lease Instrument from the Lessor, the Lessee or its solicitors shall promptly at the Lessee’s own cost and expense do all things necessary to:
|
3.1.4.1
|
submit the Lease Instrument for adjudication for assessment of stamp duty at the relevant stamp office, if applicable;
|
3.1.4.2
|
pay the adjudicated amount of stamp duty on the Lease Instrument;
|
3.1.4.3
|
present the Lease Instrument together with the other relevant documents for registration within fourteen (14) days from the payment of the stamp duty.
|
3.2
|
The Lessor and the Lessee agree that they shall work together, as may reasonably be required, to complete and register the lease in favour of the Lessee. Notwithstanding anything contained herein, the Lessor also acknowledges that pending registration of the lease in favour of the Lessee, the Lessee has beneficial lease interest and the lease right over the Land.
|
3.3
|
The Lessor hereby represents and warrants that it has never entered into or committed with any arrangement with any third party in relation to the Land (including sale, purchase, occupational right or any option thereto) and to the best of its knowledge that there is no claim made by any third party against the Lessor over the Land which may affect the rights, title and interest of the Lessee under this Agreement. Any losses suffered by the Lessee which is proven to be due to a breach by the Lessor of the representation made under this Clause shall be indemnified by the Lessor. Nevertheless the Lessor shall not be responsible for any indirect or consequential loss including other economic or financial loss or expense whatsoever as may be suffered by the Lessee.
|
3.4
|
Provided always that if the Lessee or its solicitors shall fail to present the Lease Instrument for registration pursuant to Clause 3.1.4.3, the Lessor or its solicitors may at its sole discretion do all things necessary to present the Lease Instrument for registration and any monies expended by the Lessor shall be repayable by the Lessee to the Lessor on
|
3.5
|
The Lessee shall return the original document of title in respect of the Land to the Lessor forthwith upon the registration of the Lease Instrument.
|
5.2.1
|
Notwithstanding the scope of the implied conditions in Section 117 of the NLC, as soon as possible after possession of the Land has been delivered to the Lessee and in any case within thirty (30) months from the date of the Agreement or from such further term, if any, as may be approved by the Lessor, the Lessee shall at its own cost and expense erect and complete thereon such factory, building or buildings for the purpose agreed upon in accordance with a plan approved by the local authority and shall commence its industrial operations thereat.
|
5.2.2
|
Any right of the Lessee to assign the lease, underlet or sublet or rent the buildings built on the Land shall be as set out in Section 11 of the Third Schedule.
|
5.3
|
Restriction on Construction of Other Buildings
|
6.1
|
The Lessor hereby covenants with the Lessee, subject to the Lessee shall at all times during the Term pay the Lease Consideration and otherwise perform and observe all the covenants and conditions herein contained on the Lessee’s part to be performed and observed, that the Lessee may peaceably and quietly possess and enjoy the Land during the Term without any interruption by the Lessor or any person claiming through or under the Lessor, subject always to the Exceptions and Reservations set out in the Second Schedule hereto.
|
6.2
|
The Lessor shall not at any time, during the continuance of the Term, sell, transfer, charge or otherwise howsoever dispose of or encumber or part with the legal or beneficial ownership of the Land, except upon the direction or directive of the state government or the federal government and/or upon any legal provisions under the laws of Malaysia.
|
6.3
|
Subject to consent granted by the Lessor pursuant to Section 11 of the Third Schedule of this Agreement, the Lessor shall upon request by the Lessee, render to the State Authority, in the opinion of the Lessor to be a reasonable, recommendation in support of the application by the Lessee in the event the Lessee intends to transfer, assign, charge or otherwise howsoever dispose of or encumber its lease right over the Land and/or otherwise howsoever part with the actual or legal possession, occupation or use of the whole or part of the Land,
except upon the direction or directive of the state government or the federal government and/or upon any legal provisions under the laws of Malaysia. Notwithstanding the foregoing, the Lessor agrees that the Lessee shall have the right to assign the lease right over the Land to its Affiliate without prior written consent of the Lessor Provided Always and subject to the conditions that:
|
6.3.1
|
the Lessee shall ensure that the Affiliate receiving the benefit of the assignment of the lease shall:
|
6.3.1.1
|
undertake to the Lessor to comply with all the terms and condition of this Agreement;
|
6.3.1.2
|
continue to adhere to and comply with the Authorised Use under this Agreement and as approved by the Department of Environment and any other relevant authorities.
|
6.3.2
|
the Lessee shall have full control of the Affiliate and shall continue to be liable and responsible for the compliance of the terms and conditions of this Agreement.
|
6.4
|
The Lessor hereby warrants that the level of the Land as at the date of this Agreement is 2.6 meters finish level.
|
7.1
|
Given that the Lessee is a company or a corporation within the meaning of the Companies Act, 1965, the following provisions shall apply:
|
7.1.1
|
The Lessee shall not without the written consent of the Lessor (which shall not be unreasonably withheld) do any acts or things so as to cause compulsory winding-up proceedings to be taken against itself.
|
7.1.2
|
On the execution of this Agreement, the Lessee shall give to the Lessor in writing a list of all the shareholders then holding shares in the Lessee including particulars of all the shares held by each shareholder and the value thereof and such list shall be certified to be correct by a director or the company secretary of the Lessee.
|
9.2.1
|
This Agreement may also be terminated due to default of any party in the following events:
|
(a)
|
the Lessee fails to pay the Lease Consideration or any other payment payable by the Lessee to the Lessor under this Agreement or any part thereof and the same shall remain unpaid for a period of ten (10) working days after becoming due and payable (whether the same shall have been formally demanded or not);
|
(b)
|
any party fails to observe or perform any of the covenants, terms or stipulations herein contained and on its part to be observed or performed;
|
(c)
|
any party goes into voluntary liquidation otherwise than for the purpose of a
bona fide
reconstruction or amalgamation or an order of court is made for its compulsory winding-up or become bankrupt or have a receiving order made against any of its assets;
|
(d)
|
any party becomes insolvent or be unable to pay its debts or admits in writing its inability to pay its debts as they fall due or enter into any composition or arrangement with its creditors or make a general assignment for the benefit of its creditors or have execution or distress levied on the property of the party and such execution or distress is not lifted within seven (7) days after it is imposed; and
|
(e)
|
whole or any part of its undertaking or assets or have a receiving or adjudicating order made against it.
|
(a)
|
to the extent that such default has caused losses or damages to the Lessee but the Lessee’s enjoyment of the Land remains unaffected, the Lessee shall notify the Lessor of the nature of its losses or damages by providing clear details thereof and the parties shall use their best endeavour to amicably settle the matter within a reasonable period of time.
|
(b)
|
where the nature of such default of the Lessor affects the material right of the Lessee under this Agreement and prevents its peaceful enjoyment of the Land and as a result, the Lessee is restrained and prevented from running and conducting its business activities on the Land, the Lessee shall give notice in writing to the Lessor specifying the breach and requiring the Lessor to remedy the default within the period of sixty (60) days from the date of the notice. Failure of the Lessor to remedy such default within the prescribed period shall entitle the Lessee to terminate this Agreement and Clause 9.2.4(b) below shall apply.
|
(i)
|
a sum equivalent to the Initial Payment shall be forfeited absolutely to the Lessor as agreed liquidated damages without proof of any actual damage (which sum the Lessee hereby warrants to be a genuine pre-estimate of damage and to be reasonable compensation and further the parties hereby expressly agree that Section 75 of the Contracts Act, 1950 shall not apply to this Agreement);
|
(ii)
|
thereafter, all other payment made by the Lessee to the Lessor pursuant to this Agreement, if any, shall be refunded by the Lessor to the Lessee without any interest;
|
(iii)
|
in the event the lease hereby created shall have been registered in the name of the Lessee, the Lessee shall, at its own cost, attend to the cancellation of registration of the lease and in the event the Land shall then be subject to any encumbrance, the Lessee shall at its sole cost and expense remove or cause to be removed such
|
(iv)
|
for the purpose of securing the Lessee’s obligation under the Clause 9.2.4(a)(iii), the Lessor may hold the moneys to be refunded to the Lessee until all the duties of the Lessee in Clause 9.2.4(a)(iii) have been completed;
|
(v)
|
the Lessor shall have the right to pursue for any legal proceeding and exercise its rights under the law against the Lessee to seek for any remedy including all relevant damages.
|
(a)
|
if the termination occurs prior to the settlement of the Lease Consideration, a sum equivalent to the Initial Payment shall be forfeited absolutely to the Lessor as agreed liquidated damages without proof of any actual damage and the Lessor shall refund the remaining balance of the all other payment paid by the Lessee;
|
(b)
|
if the termination occurs subsequent to the settlement of the Lease Consideration, the Lessor shall refund to the Lessee the balance Lease Consideration for the remaining Term based on pro rata basis; and
|
(c)
|
it is hereby expressly agreed that the provisions of Clause 9.2.4(a)(iii) and (iv) shall be applicable
mutatis mutandis
.
|
9.4
|
Pursuant to the termination of this Agreement by either parties under this Clause 9, the Lessor shall have the right to deal with or dispose of the Land and any building erected on the Land in any manner as the Lessor shall see fit.
|
10.1.3
|
“Date of Possession” means the date upon which the Appropriate Authority shall take or shall be deemed to take possession of the Land or any part thereof pursuant to the Land Acquisition Act 1960;
|
10.1.5
|
“Total Acquisition” means the acquisition of the entire Land as to substantially prevent or impair the use thereof by the Lessee for the uses specified in this Agreement.
|
10.3.2
|
the Lessee shall have the right to terminate this Agreement in accordance with Clause 9.2.3(b) if the Lessee determines that such Partial Acquisition has or will adversely affect its business and operation on the Land. For the avoidance of doubt, the provisions of Clause 9.2.4(b) of this Agreement shall not be applicable for the purpose of this Clause 10.3;
|
12.1
|
It is hereby expressly agreed and declared that the position, measurements, boundaries, area or other description of the Land as given herein are believed but are not warranted to be true and correct as at the date of this Agreement.
|
12.2
|
The parties acknowledge that if position, measurements, boundaries, area or other description of the Land shall be found to be different from its position, measurements, boundaries, area or other description as herein described:
|
(a)
|
such difference shall not affect the lease hereby created nor in any way affect the validity of this Agreement nor be a ground for rescission hereof and no damages or other compensation shall be payable to either party; and
|
(b)
|
the Lease Consideration shall be adjusted accordingly relative to the then applicable position, measurements, boundaries, area or other description of the Land.
|
12.3
|
The Lessee shall have the right to conduct a survey at its own cost and expense but subject to the Lessor’s prior written consent, in order to ascertain the actual area of the Land and the Lease Consideration may be adjusted to suit the surveyed area. The adjustment of Lease Consideration shall take effect from commencement of the Term and any underpayment an overpayment in the Lease Consideration shall be paid free of interest on written demand by either party to the other. Upon the completion of the survey referred to in Clause 2.7, the Lessee hereby declares that the Lessee has entered into this Agreement with notice of the actual state and condition of the Land and being satisfied therewith takes the Land as it is.
|
12.4.3.1
|
the expense of any such precautionary, mitigative, remedial or additional works in at or about the Land undertaken by the Lessee; or
|
12.4.3.2
|
any other economic or financial loss or expense whatsoever as may be suffered or incurred by the Lessee;
|
12.5
|
Notwithstanding any other provision in this Agreement and for the avoidance of doubt, the Lessor hereby covenants, undertakes, warrants and represents that the Land’s category of land use is suitable with the proposed Authorised Use.
|
14.1
|
If after the Lessee has vacated the Land on the expiration or sooner determination of the lease, any property of the Lessee remains in on or about the Land and the Lessee fails to remove it (if so capable of removing it) within fifteen (15) working days after being requested in writing by the Lessor to do so, the Lessee hereby agrees that:
|
14.1.1
|
the Lessor may as the agent of the Lessee sell such property and the Lessee will indemnify and keep indemnified the Lessor against any liability incurred by it to any other person whose property shall have been sold by the Lessor in the mistaken belief held in good faith (which shall be presumed unless the contrary be proved) that such property belonged to the Lessee; and
|
14.1.2
|
if the Lessor having made reasonable efforts is unable to locate the Lessee, the Lessor shall be entitled to retain such proceeds of sale absolutely unless the Lessee shall claim them within six (6) months from the date upon which the Lessee vacated the Land.
|
15.1
|
Any notice request demand or other communication to be given by either party to the other under or pursuant to this Agreement shall be in writing and shall be given by any one of the following means, that is to say;
|
15.2
|
Any such notice request demand or other communication shall be deemed to have been served (whether or not it is actually received):
|
15.2.1
|
if given by facsimile and/or email, when transmitted, provided that a copy thereof shall at any time also have been sent by registered post;
|
15.2.2
|
if given by registered post, upon the expiration of forty-eight (48) hours after posting; or
|
15.2.3
|
if given by personal delivery, when delivered.
|
16.1
|
All costs and expenses including stamp duty, alienation, demarcation, processing, survey, resurvey fees and registration fee (if any) in respect of the alienation of and the issuance of title of the Land to the Lessor shall be borne and paid solely by the Lessor.
|
16.2
|
All costs and expenses including stamp duty cost payable on this Agreement and registration of the Lease Instrument shall be borne and paid solely by the Lessee.
|
17.5.2
|
In the event of any breach of or default in any of the terms and conditions of this Agreement by a party, then:
|
17.5.2.1
|
any indulgence whatsoever given by the other party upon, after or in respect of such breach or default;
|
17.5.2.2
|
any knowledge or acquiescence by the other party of or in such breach or default;
|
17.5.2.3
|
any failure omission delay or relaxation by the other party in exercising any of its rights or remedies contained in this Agreement or provided by law upon, after or in respect of such breach or default; or
|
17.6.1
|
Neither party shall be in breach of their obligations under this Agreement if the party is unable to perform its obligations under this Agreement (or any part of them), other than the payment and indemnification obligations, if any, as a result of the occurrence of an event of force majeure, which are extraordinary events or circumstances affecting this Agreement and are completely beyond the control of the parties, which limited to the following:
|
(a)
|
war (whether declared or not), hostilities, invasion and act of foreign enemies;
|
(b)
|
insurrection, revolution, rebellion, military or usurped power, civil war or acts of terrorism;
|
(c)
|
natural catastrophes including but not limited to earthquakes, floods or any operation of the forces of nature against which the parties could not reasonably have been expected to take precautions;
|
(d)
|
nuclear explosion, radioactive or chemical contamination or radiation;
|
(e)
|
pressure waves caused by aircraft or other aerial devices travelling at sonic or supersonic speeds;
|
(f)
|
riot, commotion or disorder; and
|
(g)
|
any other conditions as may be agreed between the parties.
|
17.6.2
|
If an Event of Force Majeure occurs by reason of which any party is unable to perform any of its obligations under this Agreement (or any part thereof), the said party shall inform the other party immediately of the occurrence of such Event of Force Majeure with full particulars thereof and the consequences thereof.
|
17.6.3
|
If the parties consider the Event of Force Majeure to be of such severity or to be continuing for such period of time that it effectively frustrates the original intention of this Agreement, then the parties may agree that this Agreement may be terminated upon mutual agreement of the Parties in writing.
|
17.6.4
|
If this Agreement is terminated by an Event of Force Majeure, all rights, obligations and liabilities of the parties under this Agreement shall forthwith cease and neither party shall have any claim against the other party and neither party shall be liable to each.
|
17.6.5
|
Either party shall be entitled to rely upon the provisions above if the parties reasonably determine that an Event of Force Majeure has occurred.
|
17.6.6
|
The parties shall continue to perform parts of those obligations not affected, delayed or interrupted by an Event of Force Majeure and such obligation shall, pending the outcome of this Clause 17.6, continue in full force and effect.
|
Section
|
Matter
|
Particulars
|
1.
|
The day and year of this Agreement
|
The 19th day of September 2013
|
2.
|
The name and description of the Lessee
|
Haemonetics Malaysia Sdn Bhd
(Company No.: 1055910-U)
Registered Address:
Level 6.03, Menara Keck Seng, 203 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia
|
3.
|
The Term
|
A term of thirty (30) years commencing on the date of this Agreement.
|
4.
|
The Land
|
All the lands and hereditaments comprised or formerly comprised in Plot 308, Batu Kawan Industrial Park and measuring approximately twelve point two six four six (12.2646) acres, the plan of which is annexed to this Agreement.
|
5.
|
Lease Consideration
|
Ringgit Malaysia Eight Million Thirteen Thousand Six Hundred Eighty Nine and Sen Seventy (RM8,013,689.70) only which is calculated based on Ringgit Malaysia Fifteen (RM15.00) only per square foot.
|
6.
|
Payment Structure
|
(i) Twenty percent (20%) of the Lease Consideration upon the execution of the Agreement as the Initial Payment amounting to Ringgit Malaysia One Million Six Hundred Two Thousand Seven Hundred Thirty Seven and Sen Ninety (RM1,602,737.90) only.
(ii) Thirty Percent (30%) of the Lease Consideration within four months (4) from the date of this Agreement amounting to Ringgit Malaysia Two Million Four Hundred Four Thousand One Hundred Six and Sen Ninety (RM2,404,106.90) only.
iii) Fifty Percent (50%) of the Lease Consideration within six months (6) from the date of this Agreement amounting to Ringgit Malaysia Four Million Six Thousand Eight Hundred Forty Four and Sen Ninety (RM4,006,844.90) only.
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7.
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The Authorised Use
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Manufacture of medical consumables including blood and blood component collection and providing related consultancy services thereto.
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8.
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The Prescribed Rate
|
Eight percent (8%) per annum
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1.1
|
The Lessee shall use the Land for and only for the purpose of the Authorised Use and shall not without the consent in writing of the Lessor first obtained use or occupy the Land or any part thereof or suffer the same to be used or occupied for any purpose or purposes other than the Authorised Use, which consent may be given or refused as the Lessor shall in its absolute discretion think fit and upon such terms and conditions as the Lessor may require.
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1.2
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The Lessee shall not use or permit or suffer the Land or any part thereof to be used for any illegal or immoral purpose.
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1.3
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The Lessee shall not hold or permit to be held any sale by auction or any public, political or religious meeting on the Land or any part thereof nor perform or conduct or permit to be performed or conducted in at or about the Land any religious service, rite or ceremony of any nature whatsoever.
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1.4
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The Lessee shall not use or permit or suffer the Land or any part thereof to be used for any purpose or reason whatsoever which in the opinion of the Lessor shall have the effect of adversely affecting the interest of the Lessor.
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5.1
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The Lessee shall throughout the Term at its own cost and expense, maintain, repair and keep all the buildings and structures erected on the Land including but not limited to all drains and all drains and sanitary water and electrical apparatus (including all electrical power generating plants, machinery and equipment located in at or about the Land for the supply of electricity and water pumps, machinery and equipment located in at or about the Land and the supply of water to the Land) and all fixtures and fittings and all glass in good tenantable repair and condition, fair wear and tear excepted, making such replacements from time to time as may be necessary, and shall yield up the same in such repair and condition at the expiration or sooner determination of this lease.
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5.2
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The Lessee shall keep all buildings and structures erected on the Land and the surroundings thereof in a clean proper and neat order.
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6.1
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The Lessee shall at its own cost and expense comply with all laws, by-laws, regulations and any other orders, directives or requirements of the State Authority or any Appropriate Authority (whether having force of law or otherwise) relating to or affecting the Land and or the Lessee’s use thereof as permitted in this Agreement and or any matter connected therewith or incidental thereto, and the Lessee shall not do or permit to be done anything which will infringe any of such laws, by-laws, regulations, orders, directives or requirements and shall attend to and comply with all notices or orders issued by the State Authority or any Appropriate Authority whether received by the Lessee or the Lessor in respect thereof and the Lessee shall give full particulars of such notices or orders to the Lessor and the Lessee shall on demand repay to the Lessor any money expended by the Lessor in complying with such notices or orders.
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6.2
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Without limiting the generality of the foregoing, the Lessee shall at its own cost and expense:
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6.2.1
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and at all times have in effect all licences, permits, approvals, permission or consent of or from any Appropriate Authority as shall be necessary; and
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6.2.2
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comply with all category of land use, restrictions in interest and express conditions on the Qualified Title at all times and or from time to time whenever applicable.
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8.1
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The Lessee shall not do any act or thing which shall or may increase the risk of fire to the Land or any part thereof but shall take full and proper precautions to protect the Land from risk of damage by fire and the Lessee shall not bring or store or permit or suffer to be brought or stored on the Land or any part thereof any article substance or thing which in the opinion of the Lessor is of a noxious or dangerous or hazardous or inflammable or combustible nature Provided always that nothing herein shall prohibit the Lessee from bringing or storing on the Land such article substance or thing which may be considered by the Lessor as noxious or dangerous or hazardous or inflammable or combustible if:
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8.1.2
|
the Lessee shall handle, store or otherwise deal with such article substance or thing with due care, taking all precautions as may be necessary, and in accordance with all applicable laws.
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9.1
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The Lessee shall at all times during the Term at its own cost and expense procure and keep in effect Public Liability Insurance in the amount of Ringgit Malaysia Three Million (RM3,000,000.00) against all claims for personal injury, death, property damage or other liabilities related to the condition, use or occupancy of the Land or to any of the Lessee’s operations thereat.
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9.2.1
|
to procure and ensure that the Lessor and the State Authority shall be named as additional insured parties for Public Liability Insurance effected by the Lessee pursuant hereto;
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9.2.2
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to produce on demand to the Lessor a certificate of insurance evidencing that such a Public Liability Insurance policy is in effect;
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9.2.3
|
to give notice to the Lessor immediately upon the happening of any event which shall or may in any way affect such insurance; and
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9.2.4
|
not do anything whereby such insurance may be rendered void or voidable or whereby the premium for any such insurance may be liable to be increased and to pay all sums payable by way of increased premium.
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9.3
|
If the Lessee shall at any time fail to procure and keep in effect such aforesaid insurance and the Lessor (as it is hereby agreed may without being under any obligation so to do) shall effect and maintain such insurance, the Lessee shall repay to the Lessor on demand any money expended by the Lessor for that purpose.
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1
|
Subject to Section 2 of the Fourth Schedule below, the Lessee hereby expressly declares and agrees that the Lessee has entered into this Agreement with full notice and knowledge that:
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1.1
|
the Term of the lease is thirty (30) years only from the execution of this Agreement;
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1.2
|
that prior to the expiry of the Term, this Agreement may be terminated by the Lessor pursuant to Clause 9.2.2 of this Agreement; and
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1.3
|
upon the expiration of the Term or earlier termination of this Agreement pursuant to Clause 9.4, the Lessor shall have full rights and powers to re-enter upon the Land and to do such things as authorised by this Agreement or under the law,
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2.1
|
If prior to the expiration of the Term hereby created, the Lessee desires a renewal of the lease, it shall have the option to submit a written request to the Lessor not later that six (6) months prior to such expiry of the Terms (“Option”) and provided that there shall not be at the time of such request any existing breach or non-observance of any of the terms of this Agreement, the Lessor shall, at the expense of the Lessee, grant to the Lessee a renewed term for the period to be determined by the Lessee (which period shall not be lesser than ten (10) years or exceed any such term remaining on the State lease in relation to the Land) (“Renewed Term”) from the expiration of the Term at a renewed lease consideration (“the Renewed Lease Consideration”) and on any other conditions as shall be agreed upon between the parties hereto but otherwise containing the like covenant and provisions in this Agreement with the exception of the present covenant for renewal.
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2.2
|
In the event that the parties hereto shall fail to come to an agreement on the renewed Lease Consideration, both parties shall appoint an independent and qualified assessor to be mutually agreed upon by the parties and whose costs and expenses shall be paid by the Lessee (no later than four (4) months prior to the expiry of the Term hereby created) who shall then assess the prevailing market value of the Land which shall then be used as a basis for the renewed Lease Consideration. If, thereafter, the parties are still unable to agree on the Renewed Lease Consideration, the parties agree that no Renewed Term shall be granted to the Lessee and that Section 13 of Third Schedule shall apply.
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1.
|
I have reviewed this quarterly report on Form 10-Q of Haemonetics Corporation;
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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;
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4.
|
The registrant’s other certifying officer 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;
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b)
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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
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5.
|
The registrant’s other certifying officer 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 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.
|
|
/s/ Brian Concannon
|
|
||
|
Brian Concannon, President and Chief Executive
|
|
||
|
Officer (Principal Executive Officer)
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Haemonetics Corporation;
|
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 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 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 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.
|
|
/s/ Christopher Lindop
|
|
||
|
Christopher Lindop, Chief Financial Officer and
|
|
||
|
Executive Vice President Business Development
(Principal Financial Officer)
|
|
|
/s/ Brian Concannon
|
|
||
|
Brian Concannon,
|
|
||
|
President and Chief Executive Officer
|
|
|
/s/ Christopher Lindop
|
|
||
|
Christopher Lindop,
|
|
||
|
Chief Financial Officer and Executive Vice President
Business Development
|
|