x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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New Jersey
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22-2746503
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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10420 Research Road, SE, Albuquerque, New Mexico, 87123
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(Address of principal executive offices) (Zip Code)
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Page
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PART I.
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Financial Information
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ITEM 1.
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Financial Statements
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For the Three Months Ended December 31,
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||||||
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2011
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|
2010
|
||||
Revenue
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$
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37,451
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$
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52,107
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Cost of revenue
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33,983
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39,427
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Gross profit
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3,468
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|
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12,680
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Operating expenses (income):
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|
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|
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Selling, general, and administrative
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7,480
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|
8,264
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Research and development
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6,980
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|
7,191
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|
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Flood-related losses
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5,698
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|
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—
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Flood-related insurance proceeds
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(5,000
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)
|
|
—
|
|
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Total operating expenses
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15,158
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|
|
15,455
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|
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Operating loss
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(11,690
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)
|
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(2,775
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)
|
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Other income (expense):
|
|
|
|
|
|
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Interest income
|
1
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|
|
—
|
|
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Interest expense
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(130
|
)
|
|
(258
|
)
|
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Foreign exchange gain (loss)
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89
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|
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(335
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)
|
||
Loss from equity method investment
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(960
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)
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|
—
|
|
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Change in fair value of financial instruments
|
105
|
|
|
(272
|
)
|
||
Other expense
|
—
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|
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(5
|
)
|
||
Total other expense
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(895
|
)
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|
(870
|
)
|
||
Loss before income tax expense
|
(12,585
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)
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(3,645
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)
|
||
Foreign income tax expense on capital distributions
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(1,644
|
)
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|
—
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|
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Net loss
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$
|
(14,229
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)
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|
$
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(3,645
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)
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Foreign exchange translation adjustment
|
401
|
|
|
106
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Comprehensive loss
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$
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(13,828
|
)
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|
$
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(3,539
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)
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Per share data:
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|
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|
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Net loss per basic share
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$
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(0.15
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)
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$
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(0.04
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)
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Net loss per diluted share
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$
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(0.15
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)
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$
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(0.04
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)
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Weighted-average number of basic shares outstanding
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93,904
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85,250
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Weighted-average number of diluted shares outstanding
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93,904
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85,250
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As of
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As of
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||||
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December 31,
2011 |
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September 30,
2011 |
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ASSETS
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Current assets:
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Cash and cash equivalents
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$
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22,139
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$
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15,598
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Restricted cash
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1,660
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|
544
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Accounts receivable, net of allowance of $3,245 and $3,332, respectively
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25,732
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34,875
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Inventory
|
29,893
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33,166
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Prepaid expenses and other current assets
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10,416
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7,168
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Total current assets
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89,840
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91,351
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Property, plant, and equipment, net
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42,733
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46,786
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Goodwill
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20,384
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20,384
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Other intangible assets, net
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5,405
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5,866
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Equity method investment
|
242
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2,374
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Other non-current assets, net of allowance of $3,434 and $3,641, respectively
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4,710
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3,537
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Total assets
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$
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163,314
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$
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170,298
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LIABILITIES and SHAREHOLDERS’ EQUITY
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Current liabilities:
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Borrowings from credit facility
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$
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6,005
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$
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17,557
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Accounts payable
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30,498
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26,581
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Warrant liability
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496
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601
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Accrued expenses and other current liabilities
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33,949
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22,319
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Total current liabilities
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70,948
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67,058
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Asset retirement obligations
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4,851
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4,800
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Other long-term liabilities
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816
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4
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Total liabilities
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76,615
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71,862
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Commitments and contingencies (Note 12)
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Shareholders’ equity:
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Preferred stock, $0.0001 par value, 5,882 shares authorized; none issued or outstanding
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—
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—
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Common stock, no par value, 200,000 shares authorized; 94,228 shares issued and 94,069 shares outstanding as of December 31, 2011; 94,084 shares issued and 93,925 shares outstanding as of September 30, 2011
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715,154
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713,063
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Treasury stock, at cost; 159 shares
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(2,083
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)
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(2,083
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)
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Accumulated other comprehensive income
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1,313
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|
912
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Accumulated deficit
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(627,685
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)
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(613,456
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)
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Total shareholders’ equity
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86,699
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|
98,436
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Total liabilities and shareholders’ equity
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$
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163,314
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$
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170,298
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For the Three Months Ended
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||||||
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December 31,
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||||||
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2011
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|
2010
|
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Cash flows from operating activities:
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|
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|
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Net loss
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$
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(14,229
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)
|
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$
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(3,645
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)
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Adjustments to reconcile net loss to net cash provided by operating activities:
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Depreciation, amortization, and accretion expense
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2,775
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3,007
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Stock-based compensation expense
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2,180
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1,122
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Provision for doubtful accounts
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(87
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)
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|
64
|
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Provision for product warranty
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172
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|
211
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Provision for losses on inventory purchase commitments
|
908
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|
|
—
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Loss from equity method investment
|
960
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|
|
—
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|
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Change in fair value of financial instruments
|
(105
|
)
|
|
272
|
|
||
Loss on disposal of equipment
|
35
|
|
|
—
|
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Flood-related losses
|
5,698
|
|
|
—
|
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Total non-cash adjustments
|
12,536
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|
|
4,676
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|
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Changes in operating assets and liabilities:
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|
|
|
||||
Accounts receivable
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9,441
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|
|
5,343
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Inventory
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(584
|
)
|
|
314
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|
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Other assets
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(2,549
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)
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(138
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)
|
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Accounts payable
|
3,693
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|
|
531
|
|
||
Accrued expenses and other current liabilities
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12,539
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(2,652
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)
|
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Total change in operating assets and liabilities
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22,540
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|
|
3,398
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Net cash provided by operating activities
|
20,847
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|
|
4,429
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Cash flows from investing activities:
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|
|
|
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Purchase of equipment
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(2,280
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)
|
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(984
|
)
|
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Deposits on equipment orders
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(1,133
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)
|
|
—
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|
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Investment in internally-developed patents
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—
|
|
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(188
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)
|
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Dividend from unconsolidated affiliate
|
1,644
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|
|
—
|
|
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Increase in restricted cash
|
(1,116
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)
|
|
(1,049
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)
|
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Net cash used in investing activities
|
(2,885
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)
|
|
(2,221
|
)
|
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Cash flows from financing activities:
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|
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|
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Net proceeds from (payments on) borrowings from credit facilities
|
(11,551
|
)
|
|
1,183
|
|
||
Financing cost related to issuance of credit facility
|
—
|
|
|
(534
|
)
|
||
Proceeds from stock plans
|
29
|
|
|
30
|
|
||
Payments on capital lease obligations
|
—
|
|
|
(1
|
)
|
||
Net cash provided by (used in) financing activities
|
(11,522
|
)
|
|
678
|
|
||
Effect of exchange rate changes on foreign currency
|
101
|
|
|
217
|
|
||
Net increase in cash and cash equivalents
|
6,541
|
|
|
3,103
|
|
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Cash and cash equivalents at beginning of period
|
15,598
|
|
|
19,944
|
|
||
Cash and cash equivalents at end of period
|
$
|
22,139
|
|
|
$
|
23,047
|
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
|
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|
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Cash paid during the period for interest
|
$
|
89
|
|
|
$
|
78
|
|
Cash paid during the period for income taxes
|
$
|
1,644
|
|
|
$
|
—
|
|
NOTE 1.
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Basis of Presentation
|
•
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the valuation of inventory, goodwill, intangible assets, warrants, and stock-based compensation;
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•
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assessment of recovery of long-lived assets;
|
•
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asset retirement obligations and litigation contingencies;
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•
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revenue recognition associated with the percentage of completion method;
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•
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the allowance for doubtful accounts and warranty accruals; and,
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•
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losses associated with the Thailand flood.
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•
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In November 2010, we entered into a Credit and Security Agreement (credit facility) with Wells Fargo Bank (Wells Fargo). The credit facility provides us with a revolving credit of up to $35 million through November 2013 that can be used for working capital requirements, letters of credit, and other general corporate purposes. The credit facility was initially secured by the Company's accounts receivables and inventory assets and was subject to a borrowing base formula based on the Company's eligible accounts receivable and inventory accounts. On December 21, 2011, we signed an amendment to our credit facility that increased our eligible borrowing base by up to $10 million by adding to the borrowing base formula 85% of the appraised value of the Company's equipment and 50% of the appraised value of the Company's real estate. In addition, Wells Fargo reduced our restrictions under the excess availability financial covenant requirement from $7.5 million to $3.5 million through December 2012. The interest rate on outstanding borrowings was increased to LIBOR rate plus four percent. We now expect at least 70% of the total amount of credit under the credit facility to be available for use based on the revised borrowing base formula during fiscal 2012. The credit facility will return to its previous agreement terms on the earlier of (i) December 31, 2012, or (ii) the date that we receive insurance proceeds of not less than $30.0 million in the aggregate applicable to the flooding of our primary contract manufacturer in Thailand.
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•
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In August 2011, we entered into a committed equity line financing facility (equity facility) with Commerce Court Small Cap Value Fund, Ltd. (Commerce Court) whereby Commerce Court has committed, upon issuance of a draw-down request by us, to purchase up to $50 million worth of our common stock over a two-year period, subject to our common stock trading above $1 per share during the draw down period, unless a waiver is received. As of
December 31, 2011
, there have been no draw down transactions completed under this equity facility.
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•
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In November 2011, we entered into an agreement with our contract manufacturer in Thailand whereby our contract manufacturer will purchase equipment to rebuild our affected manufacturing lines. We agreed to reimburse our contract manufacturer using insurance proceeds that we expect to receive. Additionally, we restructured our outstanding payables owed to our contract manufacturer, which delayed payments to future dates to coincide with expected timing of insurance proceeds.
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•
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During the three months ended December 31, 2011:
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◦
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We signed agreements with certain customers related to our Fiber Optics segment pursuant to which they will receive an allocation of our finished goods inventory that was not damaged by the Thailand flood, as well as a percentage of future output from our new production lines being placed into service during fiscal 2012. As consideration, we received $6.4 million through
December 31, 2011
as partial prepayments for future product shipments. These advanced payments will be used to support our working capital requirements and purchases of manufacturing equipment.
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◦
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We claimed damages and received proceeds of $5.0 million under our own comprehensive insurance policy relating to business interruption and we recorded this amount as flood-related insurance proceeds during the three months ended December 31, 2011.
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◦
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We also received a deposit totaling $3.3 million from our Suncore joint venture related to an $11.0 million order for terrestrial CPV solar cells.
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NOTE 2.
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Recent Accounting Pronouncements
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NOTE 3.
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Fair Value Accounting
|
•
|
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities. We classify investments within Level 1 if quoted prices are available in active markets. Level 1 assets include instruments valued based on quoted market prices in active markets which generally could include money market funds, corporate publicly traded equity securities on major exchanges, and U.S. Treasury notes with quoted prices on active markets.
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•
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Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly, through market corroboration, for substantially the full term of the financial instrument. We classify items in Level 2 if the investments are valued using observable inputs to quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. These investments could include: government agencies, corporate bonds, commercial paper, and auction rate securities.
|
•
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Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. We do not hold any financial assets or liabilities within Level 3.
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Fair Value Measurement
|
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(in thousands)
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Level 1
|
|
Level 2
|
|
Level 3
|
|
|
|||||||
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Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Remaining Inputs
|
|
Significant Unobservable Inputs
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Total
|
|||||||
As of December 31, 2011
|
|
|
|
|
|
|
|
|||||||
Assets:
|
|
|
|
|
|
|
|
|||||||
Cash
|
$
|
22,139
|
|
|
—
|
|
|
—
|
|
|
$
|
22,139
|
|
|
Restricted cash
|
$
|
1,660
|
|
|
—
|
|
|
—
|
|
|
$
|
1,660
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|||||||
Warrants
|
—
|
|
|
$
|
496
|
|
|
—
|
|
|
$
|
496
|
|
|
As of September 30, 2011
|
|
|
|
|
|
|
|
|||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Cash
|
$
|
15,598
|
|
|
—
|
|
|
—
|
|
|
$
|
15,598
|
|
|
Restricted cash
|
$
|
544
|
|
|
—
|
|
|
—
|
|
|
$
|
544
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Warrants
|
—
|
|
|
$
|
601
|
|
|
—
|
|
|
$
|
601
|
|
NOTE 4.
|
Accounts Receivable
|
(in thousands)
|
As of December 31, 2011
|
|
As of September 30, 2011
|
||||
|
|
||||||
Accounts receivable
|
$
|
26,291
|
|
|
$
|
33,938
|
|
Accounts receivable – unbilled
|
2,686
|
|
|
4,269
|
|
||
Accounts receivable, gross
|
28,977
|
|
|
38,207
|
|
||
Allowance for doubtful accounts
|
(3,245
|
)
|
|
(3,332
|
)
|
||
Accounts receivable, net
|
$
|
25,732
|
|
|
$
|
34,875
|
|
NOTE 5.
|
Inventory
|
(in thousands)
|
As of December 31, 2011
|
|
As of September 30, 2011
|
||||
|
|
||||||
Raw materials
|
$
|
14,731
|
|
|
$
|
13,799
|
|
Work in-process
|
6,156
|
|
|
7,129
|
|
||
Finished goods
|
9,006
|
|
|
12,238
|
|
||
Inventory
|
$
|
29,893
|
|
|
$
|
33,166
|
|
NOTE 6.
|
Property, Plant, and Equipment
|
(in thousands)
|
As of December 31, 2011
|
|
As of September 30, 2011
|
||||
|
|
||||||
Land
|
$
|
1,502
|
|
|
$
|
1,502
|
|
Building and improvements
|
19,739
|
|
|
19,904
|
|
||
Equipment
|
9,234
|
|
|
12,656
|
|
||
Furniture and fixtures
|
48
|
|
|
51
|
|
||
Computer hardware and software
|
1,147
|
|
|
1,041
|
|
||
Leasehold improvements
|
4,370
|
|
|
4,631
|
|
||
Construction in progress
|
6,693
|
|
|
7,001
|
|
||
Property, plant, and equipment, net
|
$
|
42,733
|
|
|
$
|
46,786
|
|
NOTE 7.
|
Intangible Assets
|
(in thousands)
|
|
As of December 31, 2011
|
|
As of September 30, 2011
|
||||||||||||||||||||
|
|
Gross
Assets
|
|
Accumulated
Amortization
|
|
Net
Assets
|
|
Gross Assets
|
|
Accumulated
Amortization
|
|
Net
Assets
|
||||||||||||
Fiber Optics:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Core Technology
|
|
$
|
13,872
|
|
|
$
|
(11,141
|
)
|
|
$
|
2,731
|
|
|
$
|
13,872
|
|
|
$
|
(10,862
|
)
|
|
$
|
3,010
|
|
Customer Relations
|
|
3,511
|
|
|
(2,137
|
)
|
|
1,374
|
|
|
3,511
|
|
|
(2,071
|
)
|
|
1,440
|
|
||||||
Patents
|
|
4,697
|
|
|
(4,299
|
)
|
|
398
|
|
|
4,697
|
|
|
(4,265
|
)
|
|
432
|
|
||||||
|
|
22,080
|
|
|
(17,577
|
)
|
|
4,503
|
|
|
22,080
|
|
|
(17,198
|
)
|
|
4,882
|
|
||||||
Photovoltaics:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Patents
|
|
2,279
|
|
|
(1,377
|
)
|
|
902
|
|
|
2,279
|
|
|
(1,295
|
)
|
|
984
|
|
||||||
Total
|
|
$
|
24,359
|
|
|
$
|
(18,954
|
)
|
|
$
|
5,405
|
|
|
$
|
24,359
|
|
|
$
|
(18,493
|
)
|
|
$
|
5,866
|
|
Estimated Future Amortization Expense
|
|
||
(in thousands)
|
|
||
Nine months ended September 30, 2012
|
$
|
1,304
|
|
Fiscal year ended September 30, 2013
|
1,513
|
|
|
Fiscal year ended September 30, 2014
|
1,262
|
|
|
Fiscal year ended September 30, 2015
|
663
|
|
|
Fiscal year ended September 30, 2016
|
663
|
|
|
Thereafter
|
—
|
|
|
Total
|
$
|
5,405
|
|
NOTE 8.
|
Accrued Expenses and Other Current Liabilities
|
(in thousands)
|
As of December 31, 2011
|
|
As of September 30, 2011
|
||||
|
|
||||||
Compensation
|
$
|
5,193
|
|
|
$
|
4,222
|
|
Warranty
|
4,278
|
|
|
4,158
|
|
||
Termination fee
|
2,775
|
|
|
2,775
|
|
||
Professional fees
|
941
|
|
|
489
|
|
||
Royalty
|
1,614
|
|
|
1,627
|
|
||
Advanced payments
|
13,995
|
|
|
2,753
|
|
||
Self insurance
|
1,228
|
|
|
1,048
|
|
||
Capital lease obligations
|
5
|
|
|
1,279
|
|
||
Income and other taxes
|
1,217
|
|
|
1,269
|
|
||
Loss on sale contracts
|
477
|
|
|
480
|
|
||
Severance and restructuring accruals
|
374
|
|
|
405
|
|
||
Loss on inventory purchase commitments
|
908
|
|
|
—
|
|
||
Litigation settlements
|
—
|
|
|
1,445
|
|
||
Other
|
944
|
|
|
369
|
|
||
Accrued expenses and other current liabilities
|
$
|
33,949
|
|
|
$
|
22,319
|
|
NOTE 9.
|
Flood-related Losses
|
NOTE 10.
|
Credit Facility
|
NOTE 11.
|
Income Taxes
|
NOTE 12.
|
Commitments and Contingencies
|
NOTE 13.
|
Equity
|
Stock Option Activity
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average
Remaining Contractual Life
(in years)
|
|
Outstanding as of September 30, 2011
|
9,036,788
|
|
|
$4.44
|
|
6.43
|
Granted
|
20,250
|
|
|
$1.00
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Forfeited
|
(114,475
|
)
|
|
$2.61
|
|
|
Cancelled
|
(75,299
|
)
|
|
$3.81
|
|
|
Outstanding as of December 31, 2011
|
8,867,264
|
|
|
$4.46
|
|
6.11
|
Exercisable as of December 31, 2011
|
6,024,783
|
|
|
$5.24
|
|
5.36
|
Vested and expected to vest as of December 31, 2011
|
8,527,526
|
|
|
$4.56
|
|
6.03
|
Restricted Stock Activity
|
Restricted Stock Awards
|
|
Restricted Stock Units
|
||||||
|
Number of Shares
|
|
Weighted Average Grant Date Fair Value
|
|
Number of Shares
|
|
Weighted Average Grant Date Fair Value
|
||
Non-vested as of September 30, 2011
|
1,642,600
|
|
|
$1.45
|
|
1,232,190
|
|
|
$1.55
|
Granted
|
—
|
|
|
—
|
|
2,919,465
|
|
|
$0.96
|
Vested
|
—
|
|
|
—
|
|
—
|
|
|
—
|
Cancelled
|
(48,600
|
)
|
|
$1.42
|
|
(59,650
|
)
|
|
$1.34
|
Non-vested as of December 31, 2011
|
1,594,000
|
|
|
$1.45
|
|
4,092,005
|
|
|
$1.53
|
Black-Scholes Weighted Average Assumptions
|
For the Three Months Ended December 31,
|
||||
|
2011
|
|
2010
|
||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
Expected stock price volatility
|
106.1
|
%
|
|
98.1
|
%
|
Risk-free interest rate
|
0.9
|
%
|
|
1.3
|
%
|
Expected term (in years)
|
5.0
|
|
|
4.9
|
|
Stock-based Compensation Expense
(in thousands, except per share data)
|
For the Three Months Ended December 31,
|
||||||
|
2011
|
|
2010
|
||||
Stock-based compensation expense by award type:
|
|
|
|
||||
Employee stock options
|
$
|
1,047
|
|
|
$
|
682
|
|
Restricted stock awards and units
|
575
|
|
|
—
|
|
||
Employee stock purchase plan
|
224
|
|
|
135
|
|
||
401(k) match in common stock
|
230
|
|
|
233
|
|
||
Outside director fees
|
104
|
|
|
72
|
|
||
Total stock-based compensation expense
|
$
|
2,180
|
|
|
$
|
1,122
|
|
Stock-based compensation expense by expense category:
|
|
|
|
||||
Cost of revenue
|
$
|
476
|
|
|
$
|
216
|
|
Selling, general, and administrative
|
1,013
|
|
|
631
|
|
||
Research and development
|
691
|
|
|
275
|
|
||
Total stock-based compensation expense
|
$
|
2,180
|
|
|
$
|
1,122
|
|
Net effect on net loss per basic and diluted share
|
$
|
(0.02
|
)
|
|
$
|
(0.01
|
)
|
Future Issuances
|
Number of Common Stock Shares Available for Future Issuances
|
|
For future exercise of outstanding stock options
|
8,867,264
|
|
For future issuances to employees under the employee stock purchase plan
|
2,120,760
|
|
For future stock-based awards under the 2010 Equity Plan
|
376,345
|
|
For future exercise of warrants
|
3,000,003
|
|
For future issuance under the officer and director share purchase plan
|
428,883
|
|
Total reserved
|
14,793,255
|
|
NOTE 14.
|
Segment Data and Related Information
|
•
|
Fiber Optics: EMCORE Digital Fiber Optics Products and EMCORE Broadband Fiber Optics Products are aggregated as a separate reporting segment, Fiber Optics. Our Fiber Optics segment offers optical components, subsystems, and systems for high-speed data and telecommunications, cable television (CATV), and fiber-to-the-premises (FTTP) networks.
|
•
|
Photovoltaics: EMCORE Photovoltaics and EMCORE Solar Power are aggregated as a separate reporting segment, Photovoltaics. Our Photovoltaics segment provides products for both satellite and terrestrial applications. For satellite applications, we offer high-efficiency gallium arsenide (GaAs) multi-junction solar cells, covered interconnected cells (CICs), and solar panels. For terrestrial applications, we offer concentrating photovoltaic (CPV) power systems for commercial and utility scale solar applications as well as GaAs solar cells and integrated CPV components for use in other solar power concentrator systems.
|
Segment Revenue
|
|
For the Three Months Ended December 31,
|
||||||||||||
(in thousands, expect percentages)
|
|
2011
|
|
2010
|
||||||||||
|
|
Revenue
|
|
% of Revenue
|
|
Revenue
|
|
% of Revenue
|
||||||
Fiber Optics revenue
|
|
$
|
18,303
|
|
|
48.9
|
%
|
|
$
|
31,452
|
|
|
60.4
|
%
|
Photovoltaics revenue
|
|
19,148
|
|
|
51.1
|
%
|
|
20,655
|
|
|
39.6
|
%
|
||
Total revenue
|
|
$
|
37,451
|
|
|
100.0
|
%
|
|
$
|
52,107
|
|
|
100.0
|
%
|
Geographic Revenue
|
|
For the Three Months Ended December 31,
|
||||||||||||
(in thousands, expect percentages)
|
|
2011
|
|
2010
|
||||||||||
|
|
Revenue
|
|
% of Revenue
|
|
Revenue
|
|
% of Revenue
|
||||||
United States
|
|
$
|
22,568
|
|
|
60.3
|
%
|
|
$
|
35,076
|
|
|
67.3
|
%
|
Asia
|
|
4,861
|
|
|
13.0
|
%
|
|
7,321
|
|
|
14.0
|
%
|
||
Europe
|
|
4,301
|
|
|
11.5
|
%
|
|
2,491
|
|
|
4.8
|
%
|
||
Other
|
|
5,721
|
|
|
15.2
|
%
|
|
7,219
|
|
|
13.9
|
%
|
||
Total revenue
|
|
$
|
37,451
|
|
|
100.0
|
%
|
|
$
|
52,107
|
|
|
100.0
|
%
|
Statement of Operations Data
(in thousands)
|
For the Three Months Ended December 31,
|
||||||
|
2011
|
|
2010
|
||||
Fiber Optics operating loss
|
$
|
(11,193
|
)
|
|
$
|
(4,590
|
)
|
Photovoltaics operating income (loss)
|
(497
|
)
|
|
1,815
|
|
||
Total operating loss
|
$
|
(11,690
|
)
|
|
$
|
(2,775
|
)
|
Depreciation, Amortization, and Accretion Expense
(in thousands)
|
For the Three Months Ended December 31,
|
||||||
|
2011
|
|
2010
|
||||
Fiber Optics segment
|
$
|
1,656
|
|
|
$
|
1,663
|
|
Photovoltaics segment
|
1,119
|
|
|
1,344
|
|
||
Total depreciation, amortization, and accretion expense
|
$
|
2,775
|
|
|
$
|
3,007
|
|
Long-lived assets
|
As of December 31, 2011
|
|
As of September 30, 2011
|
||||
(in thousands)
|
|
||||||
Fiber Optics segment
|
$
|
22,454
|
|
|
$
|
26,483
|
|
Photovoltaics segment
|
45,053
|
|
|
45,545
|
|
||
Corporate division (unallocated)
|
1,015
|
|
|
1,007
|
|
||
Long-lived assets
|
$
|
68,522
|
|
|
$
|
73,035
|
|
NOTE 15.
|
Suncore Joint Venture
|
NOTE 16.
|
Subsequent Event
|
ITEM 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Statement of Operations
|
For the Three Months Ended December 31,
|
||||
|
2011
|
|
2010
|
||
Revenue
|
100.0
|
%
|
|
100.0
|
%
|
Cost of revenue
|
90.7
|
|
|
75.7
|
|
Gross profit
|
9.3
|
|
|
24.3
|
|
Operating expenses (income):
|
|
|
|
||
Selling, general, and administrative
|
20.0
|
|
|
15.9
|
|
Research and development
|
18.6
|
|
|
13.8
|
|
Flood-related losses
|
15.2
|
|
|
—
|
|
Flood-related insurance proceeds
|
(13.3
|
)
|
|
—
|
|
Total operating expenses
|
40.5
|
|
|
29.7
|
|
Operating loss
|
(31.2
|
)
|
|
(5.4
|
)
|
Other income (expense):
|
|
|
|
||
Interest income
|
—
|
|
|
—
|
|
Interest expense
|
(0.3
|
)
|
|
(0.5
|
)
|
Foreign exchange gain (loss)
|
0.2
|
|
|
(0.6
|
)
|
Loss from equity method investment
|
(2.6
|
)
|
|
—
|
|
Change in fair value of financial instruments
|
0.3
|
|
|
(0.5
|
)
|
Other expense
|
—
|
|
|
—
|
|
Total other expense
|
(2.4
|
)
|
|
(1.6
|
)
|
Loss before income tax expense
|
(33.6
|
)
|
|
(7.0
|
)
|
Foreign income tax expense on capital distributions
|
(4.4
|
)
|
|
—
|
|
Net loss
|
(38.0
|
)%
|
|
(7.0
|
)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Fiber Optics revenue
|
$
|
18,303
|
|
$
|
31,452
|
|
|
$
|
(13,149
|
)
|
|
(41.8)%
|
Photovoltaics revenue
|
19,148
|
|
20,655
|
|
|
(1,507
|
)
|
|
(7.3)%
|
|||
Total revenue
|
$
|
37,451
|
|
$
|
52,107
|
|
|
$
|
(14,656
|
)
|
|
(28.1)%
|
•
|
Broadband products, which includes cable television products, fiber-to-the-premises products, satellite communication products, and defense and homeland security products; and,
|
•
|
Digital products, which include telecom optical products, enterprise products, laser/photodetector component products, parallel optical transceiver and cable products, and fiber channel transceiver products.
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Fiber Optics gross profit (loss)
|
$
|
(875
|
)
|
$
|
5,802
|
|
|
$
|
(6,677
|
)
|
|
(115.1)%
|
Photovoltaics gross profit
|
4,343
|
|
6,878
|
|
|
(2,535
|
)
|
|
(36.9)%
|
|||
Total gross profit
|
$
|
3,468
|
|
$
|
12,680
|
|
|
$
|
(9,212
|
)
|
|
(72.6)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
SG&A expense
|
$
|
7,480
|
|
$
|
8,264
|
|
|
$
|
(784
|
)
|
|
(9.5)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
R&D expense
|
$
|
6,980
|
|
$
|
7,191
|
|
|
$
|
(211
|
)
|
|
(2.9)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Flood-related losses
|
$
|
5,698
|
|
$
|
—
|
|
|
$
|
5,698
|
|
|
—%
|
Flood-related insurance proceeds
|
$
|
(5,000
|
)
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
|
—%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Fiber Optics operating loss
|
$
|
(11,193
|
)
|
$
|
(4,590
|
)
|
|
$
|
(6,603
|
)
|
|
(143.9)%
|
Photovoltaics operating income (loss)
|
(497
|
)
|
1,815
|
|
|
(2,312
|
)
|
|
127.4%
|
|||
Total operating loss
|
$
|
(11,690
|
)
|
$
|
(2,775
|
)
|
|
$
|
(8,915
|
)
|
|
(321.3)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Interest income
|
$
|
1
|
|
$
|
—
|
|
|
$
|
1
|
|
|
#DIV/0!
|
Interest expense
|
(130
|
)
|
(258
|
)
|
|
128
|
|
|
49.6%
|
|||
Foreign exchange gain (loss)
|
89
|
|
(335
|
)
|
|
424
|
|
|
126.6%
|
|||
Loss from equity method investment
|
(960
|
)
|
—
|
|
|
(960
|
)
|
|
—%
|
|||
Change in fair value of financial instruments
|
105
|
|
(272
|
)
|
|
377
|
|
|
138.6%
|
|||
Other expense
|
—
|
|
(5
|
)
|
|
5
|
|
|
100.0%
|
|||
Total other income (expense)
|
$
|
(895
|
)
|
$
|
(870
|
)
|
|
$
|
(25
|
)
|
|
(2.9)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Net loss
|
$
|
(14,229
|
)
|
$
|
(3,645
|
)
|
|
$
|
(10,584
|
)
|
|
(290.4)%
|
•
|
In November 2010, we entered into a Credit and Security Agreement (credit facility) with Wells Fargo Bank. The credit facility provides us with a revolving credit of up to $35 million through November 2013 that can be used for working capital requirements, letters of credit, and other general corporate purposes. See
Footnote 10 - Credit Facility
in the notes to the consolidated financial statements for additional disclosures related to this credit facility.
|
•
|
In August 2011, we entered into a committed equity line financing facility (equity facility) with Commerce Court Small Cap Value Fund, Ltd. (Commerce Court) whereby Commerce Court has committed, upon issuance of a draw-down request by us, to purchase up to $50 million worth of our common stock over a two-year period, subject to our common stock trading above $1 per share during the draw down period, unless a waiver is received. As of
December 31, 2011
, there have been no draw down transactions completed under this equity facility.
|
•
|
In November 2011, we entered into an agreement with our contract manufacturer in Thailand whereby our contract manufacturer will purchase equipment to rebuild our affected manufacturing lines. We agreed to reimburse our contract manufacturer using insurance proceeds that we expect to receive. Additionally, we restructured our outstanding payables owed to our contract manufacturer, which delayed payments to future dates to coincide with expected timing of insurance proceeds.
|
•
|
During the three months ended December 31, 2011:
|
◦
|
We signed agreements with certain customers related to our Fiber Optics segment pursuant to which they will receive an allocation of our finished goods inventory that was not damaged by the Thailand flood, as well as a percentage of future output from our new production lines being placed into service during fiscal 2012. As consideration, we received $6.4 million through
December 31, 2011
as partial prepayments for future product shipments. These advanced payments will be used to support our working capital requirements and purchases of manufacturing equipment.
|
◦
|
We claimed damages and received proceeds of $5.0 million under our own comprehensive insurance policy relating to business interruption and we recorded this amount as flood-related insurance proceeds during the three months ended December 31, 2011.
|
◦
|
We also received a deposit totaling $3.3 million from our Suncore joint venture related to an $11.0 million order for terrestrial CPV solar cells.
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Net cash provided by operating activities
|
$
|
20,847
|
|
$
|
4,429
|
|
|
$
|
16,418
|
|
|
370.7%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Net cash used in investing activities
|
$
|
(2,885
|
)
|
$
|
(2,221
|
)
|
|
$
|
(664
|
)
|
|
(29.9)%
|
(in thousands, except percentages)
|
For the Three Months Ended December 31,
|
|||||||||||
|
2011
|
2010
|
|
$ Change
|
|
% Change
|
||||||
Net cash provided by (used in) financing activities
|
$
|
(11,522
|
)
|
$
|
678
|
|
|
$
|
(12,200
|
)
|
|
(1,799.4)%
|
(in thousands)
|
|
|
For the Fiscal Years Ended September 30,
|
||||||||||||||||
|
Total
|
|
2012
|
|
2013 to 2014
|
|
2015 to 2016
|
|
2017
and later
|
||||||||||
Purchase obligations
|
$
|
35,720
|
|
|
$
|
35,393
|
|
|
$
|
235
|
|
|
$
|
92
|
|
|
$
|
—
|
|
Credit facility borrowings
|
6,005
|
|
|
6,005
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Asset retirement obligations
|
4,851
|
|
|
—
|
|
|
409
|
|
|
33
|
|
|
4,409
|
|
|||||
Operating lease obligations
|
4,852
|
|
|
930
|
|
|
1,071
|
|
|
302
|
|
|
2,549
|
|
|||||
Total contractual obligations and commitments
|
$
|
51,428
|
|
|
$
|
42,328
|
|
|
$
|
1,715
|
|
|
$
|
427
|
|
|
$
|
6,958
|
|
ITEM 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
ITEM 4.
|
Controls and Procedures
|
Exhibit Number
|
Exhibit Description
|
10.1**
|
First Amendment to Credit and Security Agreement, dated December 21, 2010, between Wells Fargo Bank National Association and the Company (1).
|
31.1**
|
Certificate of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2**
|
Certificate of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1**
|
Certificate of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2**
|
Certificate of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
EMCORE CORPORATION
|
|
|
|
|
|
Date:
|
February 14, 2012
|
By:
|
/s/ Hong Hou
|
|
|
|
Hong Q. Hou, Ph.D.
|
|
|
|
Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
Date:
|
February 14, 2012
|
By:
|
/s/ Mark Weinswig
|
|
|
|
Mark Weinswig
|
|
|
|
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
(a)
|
Borrowing Base
. The borrowing base (the "Borrowing Base") is an amount equal to:
|
(i)
|
85% or such lesser percentage of Eligible Accounts as Wells Fargo in its sole discretion may deem appropriate; provided, that the percentage shall be 85% so long as the dilution of the Accounts is 5% or less,
plus
|
(ii)
|
85% or such lesser percentage of Eligible Foreign Accounts (which are not more than 120 days past invoice date) as Wells Fargo in its sole discretion may deem appropriate, provided, that the percentage shall be 85% so long as the dilution of the Accounts is 5% or less or $10,000,000.00, whichever is less,
plus
|
(iii)
|
the lesser of (x) the lesser of (a) 85% or such lesser percentage of the Net Orderly Liquidation Value of the Eligible Equipment (as determined by an appraisal acceptable to Wells Fargo) as Wells Fargo in its sole discretion may deem appropriate, or (b) 100% or such lesser percentage of the Net Forced Liquidation Value of the Eligible Equipment (as determined by an appraisal acceptable to Wells Fargo) as Wells Fargo in its sole discretion may deem appropriate, plus only after complying with all FIRREA requirements and only after Wells Fargo's receipt of a Lender's title insurance policy in form and substance satisfactory to Wells Fargo, 50% or such lesser percentage of the AS IS Market Value of the Real Property (as determined by an appraisal acceptable to Wells Fargo) as Wells Fargo in its sole discretion may deem appropriate, or (y) $10,000,000.00 (which dollar figure shall be automatically reduced on March 1, 2012, and on the first day of each month thereafter in an amount sufficient to fully amortize the Eligible Equipment component of this Romanette (iii) over an assumed term of 7 years and the Real Estate component of this Romanette
|
(iv)
|
85% or such lesser percentage of the Net Orderly Liquidation Value of Eligible Inventory (consisting of finished goods or raw materials) as Wells Fargo in its sole discretion may deem appropriate, or $10,000,000.00, whichever is less, less
|
(vi)
|
Indebtedness (including amounts outstanding under letters of credit) that Company owes Wells Fargo that has not been advanced on the Revolving Note,
less
|
(vii)
|
Indebtedness that is not otherwise described in Section 1, including Indebtedness that Wells Fargo in its sole discretion finds on the date of determination to be equal to Wells Fargo's net credit exposure with respect to any rate hedge agreement, derivative, foreign exchange, deposit, treasury management or similar transaction or arrangement extended to Company by Wells Fargo and any Indebtedness owed by Company to Wells Fargo Merchant Services, L.L.C.
|
(b)
|
Effective on January 1, 2012, Section 1.7(a) of the Credit Agreement is hereby deleted and replaced as follows:
|
Quarter Ending
|
Minimum Required Tangible
Net Worth
|
December 31, 2011
|
$75,000,000.00
|
March 31, 2012
|
$52,000,000.00
|
June 30, 2012
|
$48,500,000.00
|
September 30, 2012
|
$54,000,000.00
|
December 31, 2012
|
$65,000,000.00
|
Quarter Ending
|
Minimum Required EBITDA/ (Maximum Permitted negative EBITDA)
|
December 31, 2011
|
$(7,500,000)
|
March 31, 2012
|
$(16,000,000)
|
June 30, 2012
|
$(18,000,000)
|
September 30, 2012
|
$(18,500,000)
|
December 31, 2012
|
$1,500,000.00
|
(d)
|
The following definitions are, as applicable, hereby added to or amended in Exhibit A of the Credit Agreement:
|
(e)
|
Exhibit E to the Credit Agreement is hereby deleted and replaced with Exhibit E attached hereto.
|
2.
|
No Other Changes
. Except as explicitly amended by this Amendment, all of the terms and conditions of the Credit Agreement shall remain in full force and effect and shall apply to any advance or letter of credit thereunder.
|
3.
|
Amendment Fee
. The Company shall pay Wells Fargo a fully earned, non-refundable fee in the amount of $100,000.00 in consideration of Wells Fargo's execution and delivery of this Amendment, which fee shall be due and payable on January 31, 2012.
|
4.
|
Conditions Precedent
. This Amendment shall be effective when Wells Fargo shall have received an executed original hereof, together with each of the following, each in substance and form acceptable to Wells Fargo in its sole discretion:
|
(a)
|
The Acknowledgment and Agreement of Guarantors
set forth at the end of this Amendment, duly executed by each Guarantor.
|
(b)
|
A Certificate of the Secretary of the Company certifying as to (i) the resolutions of the board of directors of the Company approving the execution and delivery of this Amendment, (ii) the fact that the articles of incorporation and bylaws of the Company, which were certified and delivered to Wells Fargo pursuant to the Certificate of Authority of the Company's secretary or assistant secretary dated November 11, 2010 continue in full force and effect and have not been amended or otherwise modified except as set forth in the Certificate to be delivered, and (iii) certifying that the officers and agents of the Company who have been certified to Wells Fargo, pursuant to the Certificate of Authority of the Company's secretary or assistant secretary dated November 11, 2010, as being authorized to sign and to act on behalf of the Company continue to be so authorized or setting forth the sample signatures of each of the officers and agents of the Company authorized to execute and deliver this Amendment and all other documents, agreements and certificates on behalf of the Company.
|
(c)
|
The Deed of Trust, in the form attached hereto as Exhibit A, duly executed and acknowledged by the Company.
|
5.
|
Representations and Warranties
. The Company hereby represents and warrants to Wells Fargo as follows:
|
(a)
|
The Company has all requisite power and authority to execute this Amendment
and any other agreements or instruments required hereunder and to perform all of its obligations hereunder, and this Amendment
and all such other agreements and instruments has been duly executed and delivered by the Company and constitute the legal, valid and binding obligation of the Company, enforceable in accordance with its terms.
|
(b)
|
The execution, delivery and performance by the Company of this Amendment and any other agreements or instruments required hereunder have been duly authorized by all necessary corporate action and do not (i) require any authorization, consent or approval by any governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) violate any provision of any law, rule or regulation or of any order, writ, injunction or decree presently in effect, having applicability to the Company, or the articles of incorporation or by-laws of the Company, or (iii) result in a breach of or constitute a default under any indenture or loan or credit agreement or any other agreement, lease or instrument to which the Company is a party or by which it or its properties may be bound or affected.
|
(c)
|
All of the representations and warranties contained in Article V of the Credit Agreement are correct on and as of the date hereof as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date.
|
6.
|
References
. All references in the Credit Agreement to "this Agreement" shall be deemed to refer to the Credit Agreement as amended hereby; and any and all references in the Security Documents to the Credit Agreement shall be deemed to refer to the Credit Agreement as amended hereby.
|
7.
|
No Waiver
. The execution of this Amendment and the acceptance of
all other agreements and instruments related hereto shall not be deemed to be a waiver of any Default or Event of Default under the Credit Agreement or a waiver of any breach, default or event of default under any Security Document or other document held by Wells Fargo, whether or not known to Wells Fargo and whether or not existing on the date of this Amendment.
|
8.
|
Release
. The Company, and each Guarantor signing the Acknowledgment and Agreement of Guarantors set forth below, hereby absolutely and unconditionally releases and forever discharges Wells Fargo, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents and employees of any of the foregoing, from any and all claims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal law or otherwise, which the Company or each Guarantor has had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever arising from the beginning of time to and including the date of this Amendment, whether such claims, demands and causes of action are matured or unmatured or known or unknown.
|
9.
|
Costs and Expenses
. The Company hereby reaffirms its agreement under the Credit Agreement to pay or reimburse Wells Fargo on demand for all costs and expenses incurred by Wells Fargo in connection with the Loan Documents, including without limitation all reasonable fees and disbursements of legal counsel. Without limiting the generality of the foregoing, the Company specifically agrees to pay all title insurance premiums, fees and disbursements of counsel to Wells Fargo for the services performed by such counsel in connection with the preparation of this Amendment and the documents and instruments incidental hereto. The Company hereby agrees that Wells Fargo may, at any time or from time to time in its sole discretion and without further authorization by the Company, make a loan to the Company under the Credit Agreement, or apply the proceeds of any loan, for the purpose of paying any such premiums, fees, disbursements, costs and expenses and the fee required under Paragraph 3 of this Amendment.
|
10.
|
Appraisal
. As permitted pursuant to Section 5.9(d) of the Credit Agreement, Wells Fargo shall order an appraisal of the Company's domestic Equipment and Real Estate. The Company will assist in all reasonable ways with the preparation of the appraisal. The appraisal shall be performed by an appraiser satisfactory to Wells Fargo and shall be performed at the Company's sole cost and expense.
|
11.
|
Acknowledgment
. Wells Fargo acknowledges that the occurrence of the flood (which was described in the Company's October 24, 2011 press release) does not constitute an Event of Default under Section 6.1(o) of the Credit Agreement.
|
12.
|
Sale of Assets
. The Company wishes to dispose of certain non-core assets that [***] (the "Non-Core Assets"). Absent a consent from Wells Fargo, the disposal of the Non-Core Assets would constitute an Event of Default under Section 5.17 of the Credit Agreement. Subject to the sales price of the Non-Core Assets being not less than [***], Wells Fargo hereby consents to the sale of the Non-Core Assets so long as the proceeds of the same are applied in full to outstanding Advances or used in part to pay the outstanding balance of the Advances to $0.00.
|
13.
|
Miscellaneous
. This Amendment and the Acknowledgment and Agreement of Guarantors may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original and all of which counterparts, taken together, shall constitute one and the same instrument.
|
|
EMCORE CORPORATION
, a New Jersey corporation
By: /s/ Hong Q. Hou
Its: Chief Executive Officer
WELLS FARGO Bank, National
Association
By: /s/ Joe Primack
Its Authorized Signatory
|
1.
|
I have reviewed this
Quarterly
Report on Form
10-Q
of EMCORE Corporation ("Report");
|
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 officers 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.
|
Date:
|
February 14, 2012
|
By:
/s/ Hong Hou
|
|
|
Hong Q. Hou, Ph.D.
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this
Quarterly
Report on Form
10-Q
of EMCORE Corporation ("Report");
|
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 officers 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.
|
Date:
|
February 14, 2012
|
By:
/s/ Mark Weinswig
|
|
|
Mark B. Weinswig
|
|
|
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.
|
Date:
|
February 14, 2012
|
By:
/s/ Hong Hou
|
|
|
Hong Q. Hou, Ph.D.
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive 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.
|
Date:
|
February 14, 2012
|
By:
/s/ Mark Weinswig
|
|
|
Mark B. Weinswig
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|