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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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41-1532464
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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11001 Bren Road East
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Minnetonka, Minnesota
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55343
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $.01 per share
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The NASDAQ Global Select Market
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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Smaller reporting company
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(Do not check if a smaller reporting company)
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Page
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EX-10(l)
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EX-10(m)
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EX-21
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EX-23
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EX-24
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EX-31.A
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EX-31.B
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EX-32
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EX-101 INSTANCE DOCUMENT
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EX-101 SCHEMA DOCUMENT
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EX-101 CALCULATION LINKBASE DOCUMENT
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EX-101 DEFINITION LINKBASE DOCUMENT
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EX-101 LABELS LINKBASE DOCUMENT
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EX-101 PRESENTATION LINKBASE DOCUMENT
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•
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Wireless and wired hardware products, that have been the historical foundation of our business;
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•
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Services and solutions that include the following product offerings:
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◦
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Professional consulting services focused on integration and configuration of enterprise resource management (ERM) systems including customer relationship management (CRM) systems;
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◦
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Product design and development services providing customers turn-key wireless networking products that can use a wide range of wireless technology platforms;
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◦
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The Device Cloud by Etherios™ (Device Cloud) a platform as-a-service (PAAS) offering. The Device Cloud provides a secure environment in which customers can aggregate interaction with a large number of disparate devices and connect enterprise applications to these devices. This allows for devices to be monitored and controlled remotely and allows customers to easily collect, interpret and utilize data from many devices to operate their businesses more efficiently.
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◦
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Application development services;
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◦
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The Social Machine®, which is an application offering for which we won our first contract late in fiscal 2013. This application enables users of salesforce's Force.com platform to track and control devices and improve business outcomes.
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•
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The cost of connecting devices, sensors, machines, or other assets into networks has dropped dramatically over the past several years; and
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Businesses and institutions want and need to operate more efficiently and productively in a competitive global marketplace.
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custom designed or off-the-shelf hardware that enables the delivery of data from devices to networks;
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•
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software applications, such as The Social Machine®, that allow customers to monitor and manage networked devices;
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our Device Cloud to aggregate and host device data securely as well as related software applications such as The Social Machine® ; and
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•
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professional services to help customers define front-end requirements, deploy M2M solutions and provide ongoing support.
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1.
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Continued development and delivery of hardware products (especially wireless products) that remain the foundation of our business;
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2.
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The ongoing development and enhancement of The Social Machine® and other software applications, as well as enhancements to the Device Cloud and the expansion of our ability to provide related services that enable customers to deploy these solutions;
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3.
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The further development of sales and marketing capabilities that are increasingly focused on broad-based M2M solutions as opposed to solely hardware focus; and
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4.
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The expansion of strategic relationships with other key participants in the M2M ecosystem such as key channel distributors, telecommunications service providers, enterprise application providers, systems integrators and integrated circuit manufacturers.
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•
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On October 31, 2012 we acquired Etherios, Inc., a provider of consulting and professional services that uses a new cloud-based method for integrating machines into core business process via the salesforce.com service cloud (see Note 2 to our Consolidated Financial Statements).
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•
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In June 2009, we acquired substantially all the assets of MobiApps Holdings Private Limited (MobiApps), a developer of M2M communications technology focusing on satellite, cellular and hybrid satellite/cellular solutions. MobiApps has locations in India, Singapore and the U.S. We recently made the decision to discontinue sales of certain MobiApps' products and solutions.
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•
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our ability to put in place effectively and continuously evolve the infrastructure to deploy our solutions;
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•
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the features and functionality of our platform relative to any competing platforms as well as our ability to market our platform effectively;
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•
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our ability to engage in successful strategic relationships with third parties such as carriers, chip makers and systems integrators;
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•
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competing effectively for market share; and
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•
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deploying complete end-to-end solutions that meet the needs of the marketplace generally as well as the particular requirements of our customers more effectively and efficiently than competitive solutions.
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problems combining the purchased operations, technologies, or products;
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•
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unanticipated costs;
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•
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diversion of management's attention from our core business;
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•
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difficulties integrating businesses in different countries and cultures;
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•
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adverse effects on existing business relationships with suppliers and customers;
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•
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risks associated with entering markets in which we have no or limited prior experience; and
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•
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potential loss of key employees, particularly those of the purchased organization.
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2013
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First
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Second
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Third
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Fourth
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||||||||
High
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$
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10.29
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$
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10.36
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$
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10.23
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$
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10.54
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Low
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$
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8.66
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$
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8.75
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$
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8.51
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$
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9.01
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||||||||
2012
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First
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Second
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Third
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Fourth
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||||||||
High
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$
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14.21
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$
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12.58
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$
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11.46
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$
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11.27
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Low
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$
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9.87
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$
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9.97
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$
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8.12
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$
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8.30
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Period
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Total Number of Shares Purchased
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Average Price Paid per Share
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Total Number of Shares Purchased as Part of a Publicly Announced Program
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Maximum Dollar Value of Shares that May Yet Be Purchased Under the Program
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July 1, 2013 - July 31, 2013
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58,358
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$9.88
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58,358
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$8,846,545.42
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August 1, 2013 - August 31, 2013
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147,103
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$9.61
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147,103
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$7,433,166.07
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September 1, 2013 - September 30, 2013
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151,992
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$9.81
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151,992
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$5,941,735.53
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Total
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357,453
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$9.74
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357,453
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$5,941,735.53
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For Fiscal Years Ended September 30,
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2013
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2012
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2011
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2010
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2009
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||||||||||
Revenue (1)
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$
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195,381
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$
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190,558
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$
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204,160
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$
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182,548
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$
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165,928
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Gross profit
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$
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100,123
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$
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100,337
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$
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106,588
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$
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92,209
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$
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81,265
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Sales and marketing
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40,513
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39,242
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39,549
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37,010
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35,304
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Research and development
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30,327
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30,767
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31,642
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27,825
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26,381
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General and administrative (2)(3)
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21,423
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18,188
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18,206
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17,889
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14,557
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|||||
Restructuring charges, net
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313
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1,259
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154
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(468
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)
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1,953
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|||||
Operating Income
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7,547
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10,881
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17,037
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9,953
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3,070
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|||||
Total other income (expense), net
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691
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16
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(522
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)
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566
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1,212
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|||||
Income before income taxes
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8,238
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10,897
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16,515
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10,519
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4,282
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|||||
Income tax provision (4)
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2,433
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3,282
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5,496
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1,578
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199
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|||||
Net income
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$
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5,805
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$
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7,615
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$
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11,019
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$
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8,941
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$
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4,083
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||||||||||
Net income per common share - basic
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$
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0.22
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$
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0.30
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$
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0.44
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$
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0.36
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$
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0.16
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Net income per common share - diluted
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$
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0.22
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$
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0.29
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$
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0.43
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$
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0.36
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$
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0.16
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||||||||||
Balance sheet data as of September 30,
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||||||||||
Working capital (total current assets less total current liabilities)
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$
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128,014
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$
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155,377
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$
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142,748
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$
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122,105
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$
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106,121
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Total assets
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$
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299,953
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$
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293,084
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|
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$
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283,895
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$
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266,965
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$
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258,948
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Long-term debt and capital lease obligations
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$
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—
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|
|
$
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—
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|
|
$
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—
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|
|
$
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—
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|
|
$
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9
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|
Stockholders' equity
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$
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274,266
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|
|
$
|
270,857
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|
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$
|
260,716
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|
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$
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240,556
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|
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$
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229,586
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Book value per common share (stockholders' equity divided by outstanding shares)
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$
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10.73
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|
|
$
|
10.45
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|
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$
|
10.17
|
|
|
$
|
9.59
|
|
|
$
|
9.29
|
|
Number of employees as of September 30
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686
|
|
|
643
|
|
|
691
|
|
|
648
|
|
|
634
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(1)
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Acquisitions provided the following revenue during the year of acquisition: Etherios in fiscal 2013 of $11.0 million and MobiApps in fiscal 2009 of $0.4 million.
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(2)
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Included in general and administrative expense in fiscal 2010 is investigation and remediation expenses of $1.4 million ($0.9 million after tax).
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(3)
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Included in general and administrative expense in fiscal 2013 is $1.5 million ($1.0 after tax) related to the patent infringement lawsuit settlement for U.S. Ethernet Innovations. (See Note 16 to our Consolidated Financial Statements).
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(4)
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In fiscal 2013, 2012 and 2011, we recorded net discrete tax benefits of $0.8 million, $1.5 million and $0.7 million, respectively (see Note 10 to our Consolidated Financial Statements). In fiscal 2010 we reversed income tax reserves of $2.3 million associated primarily with the closing of prior tax years through statute expiration and the conclusion of a U.S. federal income tax audit. In fiscal 2009 we recorded a net discrete tax benefit of $1.2 million resulting from the reversal of tax reserves associated with the extension of the research and development credit, the resolution of certain state tax matters and the closing of a prior tax year.
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•
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Revenue was $195.4 Million
. Our revenue was $195.4 million in fiscal 2013, and increased by $4.8 million, or 2.5%, compared to revenue of approximately $190.6 million in fiscal 2012. The increase in revenue was primarily attributable to an increase in revenue from professional services by Etherios which was acquired on October 31, 2012, partially offset by a decrease in revenue associated with our mature hardware products.
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•
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Gross Margin was 51.2%.
Our gross margin decreased as a percentage of revenue to 51.2% in fiscal 2013 from 52.7% in fiscal 2012. The decrease primarily resulted from lower sales of our mature hardware products which have higher gross margins than our growth hardware products, lower gross margins for services revenue and increased costs to operate the Device Cloud. These impacts were partially offset by a reduction in the amortization of purchased and core technology, as certain intangibles were fully amortized.
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•
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Net Income was $5.8 Million and Earnings Per Diluted Share were $0.22.
Our net income was $5.8 million in fiscal 2013, a decrease of $1.8 million, or 23.5%, compared to net income of $7.6 million in fiscal 2012. Earnings per diluted share were $0.22 in fiscal 2013 compared to $0.29 in fiscal 2012. Although revenue increased by 2.5% in fiscal 2013 compared to the prior fiscal year, lower gross margins resulted in relatively flat gross profit in fiscal 2013 compared to fiscal 2012. Operating expenses were also higher in fiscal 2013 than in the previous year, primarily due to increased operating expenses associated with the operations of Etherios and a patent litigation settlement.
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|
|
Year ended September 30,
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||||||
|
|
2013
|
|
2012
|
||||
Net income
|
|
$
|
5,805
|
|
|
$
|
7,615
|
|
Interest income, net
|
|
(168
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)
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(266
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)
|
||
Income tax provision
|
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2,433
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|
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3,282
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|
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Depreciation and amortization
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7,877
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|
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7,815
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|
||
Earnings before interest, taxes, depreciation and amortization
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$
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15,947
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$
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18,446
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•
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Our Balance Sheet was Impacted by Investing and Financing Decisions.
Our current ratio was 7.0 to 1 at September 30, 2013 compared to 9.5 to 1 at September 30, 2012. Cash and cash equivalents and marketable securities, including long-term marketable securities, decreased $14.9 million to $105.7 million at September 30, 2013 from $120.6 million at September 30, 2012. During fiscal 2013, we spent $12.9 million, net of cash acquired, for the acquisition of Etherios, Inc. In addition, we repurchased
$14.1 million
of our common stock in fiscal 2013 (see Note 12 to our Consolidated Financial Statements).
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•
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After declining sales in fiscal 2012, we grew revenue in fiscal 2013 by 2.5% to $195.4 million, which included revenue from Etherios acquired in October 2012;
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•
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We generated sequential and year-over-year revenue growth in each of the last three quarters of fiscal 2013;
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•
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Revenue of our growth products portfolio, which includes service revenue, grew year-over-year in every quarter of fiscal 2013, culminating in 24.9% growth in the fourth fiscal quarter. Our service revenue included revenue from Etherios from the date of acquisition;
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•
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Collectively, our growth hardware products and services revenue grew 11.6% during the fiscal year, more than offsetting the expected and ongoing decline in sales of our mature hardware products;
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•
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We completed the acquisition of Etherios, Inc. in the first quarter of fiscal 2013, a transaction that has enhanced our solutions offerings via their platinum partner relationship with salesforce.com and the introduction of The Social Machine®, an application that enables businesses to monitor devices on the Force.com platform;
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•
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We continued to enhance our capabilities to sell end-to-end solutions. In addition to Etherios's sales personnel accustomed to making sales of services and solutions, we hired a new Senior Vice President of Global Sales and a new Vice President of Global Marketing. Historically we had one executive overseeing these positions. The individuals hired into these positions have significant experience working in organizations that sell broader based solutions as opposed to point hardware products.
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•
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We purchased $14.1 million of our common stock pursuant to a share repurchase plan.
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•
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Revenue from our mature hardware products declined by 7.3% during fiscal 2013, which was aligned with our expectations. These products remain highly profitable and are a significant source of cash, but their ongoing decline in sales volume creates headwinds to overall revenue growth. We expect continued future decreases in mature product revenue of 5% - 15% annually.
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•
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Net income fell from $7.6 million in fiscal 2012 to $5.8 million in fiscal 2013. While revenue increased in fiscal 2013, gross profit was flat and operating expenses were higher than the previous year due to incremental operating expenses associated with Etherios which was acquired on October 31, 2012 and a patent litigation settlement.
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•
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The global economic environment continued to be volatile in fiscal 2013. Revenue in North America increased $4.2 million, or 3.7%, versus fiscal 2012, primarily as a result of our acquisition of Etherios. Revenue in EMEA increased by $1.8 million, or 3.8%, over fiscal 2012. Revenue in APAC and Latin America decreased by $0.4 million, or 1.3%, and $0.8 million, or 12.0%, respectively, year-over-year compared to fiscal 2012.
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Product Revenue
|
|
% of Product Revenue
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|||||||||||||||||
($ in millions)
|
2013
|
|
2012
|
|
2011
|
|
2013
|
|
2012
|
|
2011
|
|||||||||
Growth hardware products
|
$
|
88.5
|
|
|
$
|
89.2
|
|
|
$
|
90.5
|
|
|
51.1
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%
|
|
49.4
|
%
|
|
46.9
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%
|
Mature hardware products
|
84.6
|
|
|
91.3
|
|
|
102.6
|
|
|
48.9
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%
|
|
50.6
|
%
|
|
53.1
|
%
|
|||
Total product revenue
|
$
|
173.1
|
|
|
$
|
180.5
|
|
|
$
|
193.1
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Revenue
|
|
% of Revenue
|
|||||||||||||||||
($ in millions)
|
2013
|
|
2012
|
|
2011
|
|
2013
|
|
2012
|
|
2011
|
|||||||||
North America, primarily United States
|
$
|
116.6
|
|
|
$
|
112.4
|
|
|
$
|
118.7
|
|
|
59.7
|
%
|
|
59.0
|
%
|
|
58.1
|
%
|
Europe, Middle East & Africa
|
48.8
|
|
|
47.0
|
|
|
52.1
|
|
|
25.0
|
%
|
|
24.7
|
%
|
|
25.5
|
%
|
|||
Asia
|
24.5
|
|
|
24.9
|
|
|
27.0
|
|
|
12.5
|
%
|
|
13.0
|
%
|
|
13.2
|
%
|
|||
Latin America
|
5.5
|
|
|
6.3
|
|
|
6.4
|
|
|
2.8
|
%
|
|
3.3
|
%
|
|
3.2
|
%
|
|||
Total revenue
|
$
|
195.4
|
|
|
$
|
190.6
|
|
|
$
|
204.2
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Revenue
|
|
% of Revenue
|
|||||||||||||||||
($ in millions)
|
2013
|
|
2012
|
|
2011
|
|
2013
|
|
2012
|
|
2011
|
|||||||||
Direct/OEM channel
|
$
|
80.0
|
|
|
$
|
73.6
|
|
|
$
|
73.3
|
|
|
40.9
|
%
|
|
38.6
|
%
|
|
35.9
|
%
|
Distributors channel
|
115.4
|
|
|
117.0
|
|
|
130.9
|
|
|
59.1
|
%
|
|
61.4
|
%
|
|
64.1
|
%
|
|||
Total revenue
|
$
|
195.4
|
|
|
$
|
190.6
|
|
|
$
|
204.2
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
Year ended September 30,
|
|
$ incr.
|
||||||||||||||
($ in thousands)
|
|
2013
|
|
2012
|
|
(decr.)
|
||||||||||||
Incremental ongoing expenses for Etherios
|
|
$
|
4,535
|
|
|
2.3
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
4,535
|
|
Patent litigation
|
|
1,525
|
|
|
0.8
|
|
|
200
|
|
|
0.1
|
|
|
1,325
|
|
|||
Restructuring
|
|
313
|
|
|
0.2
|
|
|
1,259
|
|
|
0.7
|
|
|
(946
|
)
|
|||
Impairment of identifiable intangibles
|
|
361
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
361
|
|
|||
All other operating expenses
|
|
85,842
|
|
|
43.9
|
|
|
87,997
|
|
|
46.2
|
|
|
(2,155
|
)
|
|||
Total operating expenses
|
|
$
|
92,576
|
|
|
47.4
|
%
|
|
$
|
89,456
|
|
|
47.0
|
%
|
|
$
|
3,120
|
|
|
Year ended September 30,
|
||||||||||
($ in thousands)
|
2013
|
|
2012
|
|
2011
|
||||||
Operating activities
|
$
|
11,748
|
|
|
$
|
15,127
|
|
|
$
|
21,839
|
|
Investing activities
|
(19,739
|
)
|
|
(10,954
|
)
|
|
(22,399
|
)
|
|||
Financing activities
|
(10,790
|
)
|
|
2,311
|
|
|
4,639
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(145
|
)
|
|
(922
|
)
|
|
(338
|
)
|
|||
Net (decrease) increase in cash and cash equivalents
|
$
|
(18,926
|
)
|
|
$
|
5,562
|
|
|
$
|
3,741
|
|
|
|
Payments due by fiscal period
|
||||||||||||||||||
($ in thousands)
|
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
Thereafter
|
||||||||||
Operating leases
|
|
$
|
5,549
|
|
|
$
|
2,527
|
|
|
$
|
2,787
|
|
|
$
|
235
|
|
|
$
|
—
|
|
|
Twelve months ended September 30,
|
|
% increase
|
|||||
|
2013
|
|
2012
|
|
(decrease)
|
|||
Euro
|
1.3120
|
|
|
1.2988
|
|
|
1.0
|
%
|
British Pound
|
1.5616
|
|
|
1.5762
|
|
|
(0.9
|
)%
|
Japanese Yen
|
0.0109
|
|
|
0.0127
|
|
|
(14.2
|
)%
|
Indian Rupee
|
0.0178
|
|
|
0.0190
|
|
|
(6.3
|
)%
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands, except per common share data)
|
||||||||||
Revenue:
|
|
|
|
|
|
||||||
Hardware product
|
$
|
173,078
|
|
|
$
|
180,434
|
|
|
$
|
193,113
|
|
Service
|
22,303
|
|
|
10,124
|
|
|
11,047
|
|
|||
Total revenue
|
195,381
|
|
|
190,558
|
|
|
204,160
|
|
|||
Cost of sales:
|
|
|
|
|
|
||||||
Cost of hardware product
|
82,276
|
|
|
84,714
|
|
|
92,897
|
|
|||
Cost of service
|
12,982
|
|
|
5,507
|
|
|
4,675
|
|
|||
Total cost of sales
|
95,258
|
|
|
90,221
|
|
|
97,572
|
|
|||
Gross profit
|
100,123
|
|
|
100,337
|
|
|
106,588
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Sales and marketing
|
40,513
|
|
|
39,242
|
|
|
39,549
|
|
|||
Research and development
|
30,327
|
|
|
30,767
|
|
|
31,642
|
|
|||
General and administrative
|
21,423
|
|
|
18,188
|
|
|
18,206
|
|
|||
Restructuring charges, net
|
313
|
|
|
1,259
|
|
|
154
|
|
|||
Total operating expenses
|
92,576
|
|
|
89,456
|
|
|
89,551
|
|
|||
Operating income
|
7,547
|
|
|
10,881
|
|
|
17,037
|
|
|||
Other income (expense), net:
|
|
|
|
|
|
||||||
Interest income
|
210
|
|
|
289
|
|
|
251
|
|
|||
Interest expense
|
(42
|
)
|
|
(23
|
)
|
|
(86
|
)
|
|||
Other income (expense), net
|
523
|
|
|
(250
|
)
|
|
(687
|
)
|
|||
Total other income (expense), net
|
691
|
|
|
16
|
|
|
(522
|
)
|
|||
Income before income taxes
|
8,238
|
|
|
10,897
|
|
|
16,515
|
|
|||
Income tax provision
|
2,433
|
|
|
3,282
|
|
|
5,496
|
|
|||
Net income
|
$
|
5,805
|
|
|
$
|
7,615
|
|
|
$
|
11,019
|
|
Net income per common share:
|
|
|
|
|
|
||||||
Basic
|
0.22
|
|
|
0.30
|
|
|
0.44
|
|
|||
Diluted
|
0.22
|
|
|
0.29
|
|
|
0.43
|
|
|||
Weighted average common shares:
|
|
|
|
|
|
||||||
Basic
|
25,956
|
|
|
25,743
|
|
|
25,312
|
|
|||
Diluted
|
26,237
|
|
|
26,146
|
|
|
25,819
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands)
|
||||||||||
Net income
|
$
|
5,805
|
|
|
$
|
7,615
|
|
|
$
|
11,019
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
(1,826
|
)
|
|
(3,354
|
)
|
|
(770
|
)
|
|||
Change in net unrealized (loss) gain on investments
|
(63
|
)
|
|
126
|
|
|
(170
|
)
|
|||
Less income tax benefit (provision)
|
24
|
|
|
(51
|
)
|
|
66
|
|
|||
Reclassification of realized loss on investments included in net income (1)
|
—
|
|
|
15
|
|
|
10
|
|
|||
Less income tax benefit (2)
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
|||
Other comprehensive loss, net of tax
|
(1,865
|
)
|
|
(3,268
|
)
|
|
(868
|
)
|
|||
Comprehensive income
|
$
|
3,940
|
|
|
$
|
4,347
|
|
|
$
|
10,151
|
|
(1)
|
Recorded in Other income (expense), net in our Consolidated Statements of Operations.
|
(2)
|
Recorded in Income tax provision in our Consolidated Statements of Operations.
|
|
As of September 30,
|
||||||
|
2013
|
|
2012
|
||||
|
(in thousands, except share data)
|
||||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
41,320
|
|
|
$
|
60,246
|
|
Marketable securities
|
47,006
|
|
|
58,372
|
|
||
Accounts receivable, net
|
26,829
|
|
|
24,634
|
|
||
Inventories
|
26,140
|
|
|
24,435
|
|
||
Deferred tax assets
|
3,174
|
|
|
3,389
|
|
||
Other
|
4,835
|
|
|
2,493
|
|
||
Total current assets
|
149,304
|
|
|
173,569
|
|
||
Marketable securities, long-term
|
17,389
|
|
|
2,016
|
|
||
Property, equipment and improvements, net
|
13,910
|
|
|
15,157
|
|
||
Identifiable intangible assets, net
|
9,728
|
|
|
10,629
|
|
||
Goodwill
|
103,569
|
|
|
86,209
|
|
||
Deferred tax assets
|
5,832
|
|
|
5,010
|
|
||
Other
|
221
|
|
|
494
|
|
||
Total assets
|
$
|
299,953
|
|
|
$
|
293,084
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
8,906
|
|
|
$
|
6,040
|
|
Income taxes payable
|
—
|
|
|
1,269
|
|
||
Accrued compensation
|
7,410
|
|
|
5,744
|
|
||
Accrued warranty
|
1,063
|
|
|
1,021
|
|
||
Other
|
3,911
|
|
|
4,118
|
|
||
Total current liabilities
|
21,290
|
|
|
18,192
|
|
||
Income taxes payable
|
3,903
|
|
|
3,294
|
|
||
Deferred tax liabilities
|
415
|
|
|
630
|
|
||
Other noncurrent liabilities
|
79
|
|
|
111
|
|
||
Total liabilities
|
25,687
|
|
|
22,227
|
|
||
Commitments and Contingencies (see Notes 15 & 16)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value; 60,000,000 shares authorized; 30,264,224 and 29,268,788 shares issued
|
303
|
|
|
293
|
|
||
Additional paid-in capital
|
211,982
|
|
|
199,495
|
|
||
Retained earnings
|
116,088
|
|
|
110,283
|
|
||
Accumulated other comprehensive loss
|
(15,590
|
)
|
|
(13,725
|
)
|
||
Treasury stock, at cost, 4,708,965 and 3,356,453 shares
|
(38,517
|
)
|
|
(25,489
|
)
|
||
Total stockholders’ equity
|
274,266
|
|
|
270,857
|
|
||
Total liabilities and stockholders’ equity
|
$
|
299,953
|
|
|
$
|
293,084
|
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
|
2013
|
|
2012
|
|
2011
|
||||||
Operating activities:
|
|
(in thousands)
|
||||||||||
Net income
|
|
$
|
5,805
|
|
|
$
|
7,615
|
|
|
$
|
11,019
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation of property, equipment and improvements
|
|
3,461
|
|
|
3,339
|
|
|
3,006
|
|
|||
Amortization of identifiable intangible assets
|
|
4,416
|
|
|
4,476
|
|
|
6,171
|
|
|||
Stock-based compensation
|
|
3,773
|
|
|
3,727
|
|
|
3,444
|
|
|||
Excess tax benefits from stock-based compensation
|
|
(67
|
)
|
|
(198
|
)
|
|
(796
|
)
|
|||
Deferred income tax benefit
|
|
(2,055
|
)
|
|
(2,452
|
)
|
|
(1,205
|
)
|
|||
Bad debt/product return provision
|
|
811
|
|
|
500
|
|
|
90
|
|
|||
Inventory obsolescence
|
|
1,258
|
|
|
1,413
|
|
|
1,935
|
|
|||
Intangible impairment charge
|
|
361
|
|
|
—
|
|
|
—
|
|
|||
Restructuring charges, net
|
|
313
|
|
|
1,259
|
|
|
154
|
|
|||
Other
|
|
(85
|
)
|
|
13
|
|
|
263
|
|
|||
Changes in operating assets and liabilities (net of acquisition):
|
|
|
|
|
|
|
||||||
Accounts receivable
|
|
(2,368
|
)
|
|
(343
|
)
|
|
(2,756
|
)
|
|||
Inventories
|
|
(2,972
|
)
|
|
(1,958
|
)
|
|
623
|
|
|||
Other assets
|
|
(212
|
)
|
|
168
|
|
|
(602
|
)
|
|||
Income taxes
|
|
(2,634
|
)
|
|
2,330
|
|
|
(432
|
)
|
|||
Accounts payable
|
|
1,413
|
|
|
(1,759
|
)
|
|
(1,227
|
)
|
|||
Accrued expenses
|
|
530
|
|
|
(3,003
|
)
|
|
2,152
|
|
|||
Net cash provided by operating activities
|
|
11,748
|
|
|
15,127
|
|
|
21,839
|
|
|||
Investing activities:
|
|
|
|
|
|
|
||||||
Purchase of marketable securities
|
|
(67,159
|
)
|
|
(72,669
|
)
|
|
(61,506
|
)
|
|||
Proceeds from maturities of marketable securities
|
|
63,089
|
|
|
65,533
|
|
|
44,843
|
|
|||
Acquisition of businesses, net of cash acquired
|
|
(12,919
|
)
|
|
—
|
|
|
(3,000
|
)
|
|||
Proceeds from sale of investment
|
|
136
|
|
|
135
|
|
|
—
|
|
|||
Purchase of property, equipment, improvements and certain other intangible assets
|
|
(2,886
|
)
|
|
(3,953
|
)
|
|
(2,736
|
)
|
|||
Net cash used in investing activities
|
|
(19,739
|
)
|
|
(10,954
|
)
|
|
(22,399
|
)
|
|||
Financing activities:
|
|
|
|
|
|
|
||||||
Excess tax benefits from stock-based compensation
|
|
67
|
|
|
198
|
|
|
796
|
|
|||
Proceeds from stock option plan transactions
|
|
2,193
|
|
|
1,072
|
|
|
2,853
|
|
|||
Proceeds from employee stock purchase plan transactions
|
|
1,008
|
|
|
1,041
|
|
|
990
|
|
|||
Purchase of common stock
|
|
(14,058
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash (used in) provided by financing activities
|
|
(10,790
|
)
|
|
2,311
|
|
|
4,639
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(145
|
)
|
|
(922
|
)
|
|
(338
|
)
|
|||
Net (decrease) increase in cash and cash equivalents
|
|
(18,926
|
)
|
|
5,562
|
|
|
3,741
|
|
|||
Cash and cash equivalents, beginning of period
|
|
60,246
|
|
|
54,684
|
|
|
50,943
|
|
|||
Cash and cash equivalents, end of period
|
|
$
|
41,320
|
|
|
$
|
60,246
|
|
|
$
|
54,684
|
|
|
|
|
|
|
|
|
||||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
||||||
Interest paid
|
|
$
|
42
|
|
|
$
|
23
|
|
|
$
|
86
|
|
Income taxes paid, net
|
|
$
|
6,300
|
|
|
$
|
3,201
|
|
|
$
|
7,065
|
|
Supplemental schedule of non-cash investing activities:
|
|
|
|
|
|
|
||||||
Accrual for capitalized intangible asset
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Issuance of common stock for business acquisition
|
|
$
|
6,741
|
|
|
$
|
—
|
|
|
$
|
—
|
|
For fiscal years ended September 30, 2013, 2012 and 2011
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
|
Other
|
|
Total
|
||||||||||||||
|
|
Common Stock
|
|
Treasury Stock
|
|
Paid-In
|
|
Retained
|
|
Comprehensive
|
|
Stockholders'
|
||||||||||||||||||
|
|
Shares
|
|
Par Value
|
|
Shares
|
|
Value
|
|
Capital
|
|
Earnings
|
|
Loss
|
|
Equity
|
||||||||||||||
Balances, September 30, 2010
|
|
28,666
|
|
|
$
|
287
|
|
|
3,584
|
|
|
$
|
(27,218
|
)
|
|
$
|
185,427
|
|
|
$
|
91,649
|
|
|
$
|
(9,589
|
)
|
|
$
|
240,556
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
11,019
|
|
|
|
|
11,019
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(868
|
)
|
|
(868
|
)
|
||||||||||||
Employee stock purchase issuances
|
|
|
|
|
|
(112
|
)
|
|
852
|
|
|
138
|
|
|
|
|
|
|
990
|
|
||||||||||
Issuance of stock upon exercise of stock options
|
|
435
|
|
|
4
|
|
|
|
|
|
|
2,849
|
|
|
|
|
|
|
2,853
|
|
||||||||||
Tax benefit realized upon exercise of stock options
|
|
|
|
|
|
|
|
|
|
2,722
|
|
|
|
|
|
|
2,722
|
|
||||||||||||
Stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
3,444
|
|
|
|
|
|
|
3,444
|
|
||||||||||||
Balances, September 30, 2011
|
|
29,101
|
|
|
$
|
291
|
|
|
3,472
|
|
|
$
|
(26,366
|
)
|
|
$
|
194,580
|
|
|
$
|
102,668
|
|
|
$
|
(10,457
|
)
|
|
$
|
260,716
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
7,615
|
|
|
|
|
7,615
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,268
|
)
|
|
(3,268
|
)
|
||||||||||||
Employee stock purchase issuances
|
|
|
|
|
|
(116
|
)
|
|
877
|
|
|
164
|
|
|
|
|
|
|
1,041
|
|
||||||||||
Issuance of stock upon exercise of stock options
|
|
168
|
|
|
2
|
|
|
|
|
|
|
1,070
|
|
|
|
|
|
|
1,072
|
|
||||||||||
Tax benefit realized upon exercise of stock options
|
|
|
|
|
|
|
|
|
|
(46
|
)
|
|
|
|
|
|
(46
|
)
|
||||||||||||
Stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
3,727
|
|
|
|
|
|
|
3,727
|
|
||||||||||||
Balances, September 30, 2012
|
|
29,269
|
|
|
$
|
293
|
|
|
3,356
|
|
|
$
|
(25,489
|
)
|
|
$
|
199,495
|
|
|
$
|
110,283
|
|
|
$
|
(13,725
|
)
|
|
$
|
270,857
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
5,805
|
|
|
|
|
5,805
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,865
|
)
|
|
(1,865
|
)
|
||||||||||||
Employee stock purchase issuances
|
|
|
|
|
|
(128
|
)
|
|
1,030
|
|
|
(22
|
)
|
|
|
|
|
|
1,008
|
|
||||||||||
Repurchase of common stock
|
|
|
|
|
|
1,481
|
|
|
(14,058
|
)
|
|
|
|
|
|
|
|
(14,058
|
)
|
|||||||||||
Issuance of stock upon exercise of stock options
|
|
280
|
|
|
3
|
|
|
|
|
|
|
2,190
|
|
|
|
|
|
|
2,193
|
|
||||||||||
Tax benefit realized upon exercise of stock options
|
|
|
|
|
|
|
|
|
|
(188
|
)
|
|
|
|
|
|
(188
|
)
|
||||||||||||
Acquisition of Etherios, Inc.
|
|
715
|
|
|
7
|
|
|
|
|
|
|
6,734
|
|
|
|
|
|
|
6,741
|
|
||||||||||
Stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
3,773
|
|
|
|
|
|
|
3,773
|
|
||||||||||||
Balances, September 30, 2013
|
|
30,264
|
|
|
$
|
303
|
|
|
4,709
|
|
|
$
|
(38,517
|
)
|
|
$
|
211,982
|
|
|
$
|
116,088
|
|
|
$
|
(15,590
|
)
|
|
$
|
274,266
|
|
•
|
Target company had publicly traded stock outstanding at the transaction date, and
|
•
|
Transactions announced between June 30, 2007 and the valuation date.
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income
|
$
|
5,805
|
|
|
$
|
7,615
|
|
|
$
|
11,019
|
|
Denominator:
|
|
|
|
|
|
||||||
Denominator for basic net income per common share — weighted average shares outstanding
|
25,956
|
|
|
25,743
|
|
|
25,312
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Stock options and restricted stock units
|
281
|
|
|
403
|
|
|
507
|
|
|||
Denominator for diluted net income per common share — adjusted weighted average shares
|
26,237
|
|
|
26,146
|
|
|
25,819
|
|
|||
Net income per common share, basic
|
$
|
0.22
|
|
|
$
|
0.30
|
|
|
$
|
0.44
|
|
Net income per common share, diluted
|
$
|
0.22
|
|
|
$
|
0.29
|
|
|
$
|
0.43
|
|
Cash, including cash in escrow
|
$
|
13,696
|
|
Common stock
|
6,741
|
|
|
Total
|
$
|
20,437
|
|
|
|
||
Fair value of net tangible assets acquired
|
$
|
1,142
|
|
Fair value of identifiable intangible assets acquired:
|
|
||
Existing customer relationships
|
1,400
|
|
|
Non-compete agreements
|
1,100
|
|
|
Trade name
|
440
|
|
|
Order backlog
|
360
|
|
|
Goodwill
|
17,282
|
|
|
Deferred tax liabilities related to identifiable intangibles
|
(1,287
|
)
|
|
Total
|
$
|
20,437
|
|
|
September 30, 2013
|
|
September 30, 2012
|
||||||||||||||||||||
|
Gross
carrying
amount
|
|
Accum.
amort.
|
|
Net
|
|
Gross
carrying
amount
|
|
Accum.
amort.
|
|
Net
|
||||||||||||
Purchased and core technology
|
$
|
45,960
|
|
|
$
|
(44,306
|
)
|
|
$
|
1,654
|
|
|
$
|
46,597
|
|
|
$
|
(43,639
|
)
|
|
$
|
2,958
|
|
License agreements
|
2,440
|
|
|
(2,440
|
)
|
|
—
|
|
|
2,840
|
|
|
(2,682
|
)
|
|
158
|
|
||||||
Patents and trademarks
|
11,322
|
|
|
(9,000
|
)
|
|
2,322
|
|
|
10,943
|
|
|
(8,469
|
)
|
|
2,474
|
|
||||||
Customer maintenance contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
700
|
|
|
(700
|
)
|
|
—
|
|
||||||
Customer relationships
|
18,954
|
|
|
(14,130
|
)
|
|
4,824
|
|
|
17,504
|
|
|
(12,465
|
)
|
|
5,039
|
|
||||||
Non-compete agreements
|
1,100
|
|
|
(202
|
)
|
|
898
|
|
|
1,045
|
|
|
(1,045
|
)
|
|
—
|
|
||||||
Order backlog
|
360
|
|
|
(330
|
)
|
|
30
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
$
|
80,136
|
|
|
$
|
(70,408
|
)
|
|
$
|
9,728
|
|
|
$
|
79,629
|
|
|
$
|
(69,000
|
)
|
|
$
|
10,629
|
|
Fiscal year
|
Total
|
||
2013
|
$
|
4,416
|
|
2012
|
$
|
4,476
|
|
2011
|
$
|
6,171
|
|
Fiscal year
|
Total
|
||
2014
|
$
|
3,619
|
|
2015
|
$
|
2,724
|
|
2016
|
$
|
1,540
|
|
2017
|
$
|
702
|
|
2018
|
$
|
482
|
|
|
Fiscal years ended September 30,
|
||||||
|
2013
|
|
2012
|
||||
Beginning balance, October 1
|
$
|
86,209
|
|
|
$
|
86,012
|
|
Acquisition of Etherios, Inc.
|
17,282
|
|
|
—
|
|
||
Foreign currency translation adjustment
|
78
|
|
|
197
|
|
||
Ending balance, September 30
|
$
|
103,569
|
|
|
$
|
86,209
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Growth hardware products and all services
|
$
|
110,741
|
|
|
$
|
99,257
|
|
|
$
|
101,565
|
|
Mature hardware products
|
84,640
|
|
|
91,301
|
|
|
102,595
|
|
|||
Total revenue
|
$
|
195,381
|
|
|
$
|
190,558
|
|
|
$
|
204,160
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
North America, primarily United States
|
$
|
116,541
|
|
|
$
|
112,398
|
|
|
$
|
118,654
|
|
Europe, Middle East & Africa
|
48,815
|
|
|
47,042
|
|
|
52,125
|
|
|||
Asia
|
24,507
|
|
|
24,844
|
|
|
26,939
|
|
|||
Latin America
|
5,518
|
|
|
6,274
|
|
|
6,442
|
|
|||
Total revenue
|
$
|
195,381
|
|
|
$
|
190,558
|
|
|
$
|
204,160
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
United States
|
$
|
13,321
|
|
|
$
|
14,233
|
|
|
$
|
14,169
|
|
International, primarily Europe
|
589
|
|
|
924
|
|
|
1,201
|
|
|||
Total net property, equipment and improvements
|
$
|
13,910
|
|
|
$
|
15,157
|
|
|
$
|
15,370
|
|
|
As of September 30,
|
||||||
|
2013
|
|
2012
|
||||
Accounts receivable, net:
|
|
|
|
||||
Accounts receivable
|
$
|
27,142
|
|
|
$
|
24,929
|
|
Less allowance for doubtful accounts
|
313
|
|
|
295
|
|
||
Total accounts receivable, net
|
$
|
26,829
|
|
|
$
|
24,634
|
|
|
|
|
|
||||
Inventories:
|
|
|
|
||||
Raw materials
|
$
|
21,171
|
|
|
$
|
18,159
|
|
Work in process
|
224
|
|
|
428
|
|
||
Finished goods
|
4,745
|
|
|
5,848
|
|
||
Total inventories
|
$
|
26,140
|
|
|
$
|
24,435
|
|
|
|
|
|
||||
Property, equipment and improvements, net:
|
|
|
|
||||
Land
|
$
|
1,800
|
|
|
$
|
1,800
|
|
Buildings
|
10,522
|
|
|
10,522
|
|
||
Improvements
|
3,863
|
|
|
3,763
|
|
||
Equipment
|
14,989
|
|
|
14,093
|
|
||
Purchased software
|
12,296
|
|
|
11,971
|
|
||
Furniture and fixtures
|
2,481
|
|
|
2,595
|
|
||
Total property, equipment and improvements, gross
|
45,951
|
|
|
44,744
|
|
||
Less accumulated depreciation and amortization
|
32,041
|
|
|
29,587
|
|
||
Total property, equipment and improvements, net
|
$
|
13,910
|
|
|
$
|
15,157
|
|
|
Amortized
Cost (1)
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value (1)
|
||||||||
Current marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
$
|
35,161
|
|
|
$
|
10
|
|
|
$
|
(30
|
)
|
|
$
|
35,141
|
|
Certificates of deposit
|
1,753
|
|
|
—
|
|
|
(2
|
)
|
|
1,751
|
|
||||
Government municipal bonds
|
10,115
|
|
|
—
|
|
|
(1
|
)
|
|
10,114
|
|
||||
Current marketable securities
|
47,029
|
|
|
10
|
|
|
(33
|
)
|
|
47,006
|
|
||||
Non-current marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
6,439
|
|
|
—
|
|
|
(6
|
)
|
|
6,433
|
|
||||
Certificates of deposit
|
11,003
|
|
|
—
|
|
|
(47
|
)
|
|
10,956
|
|
||||
Non-current marketable securities
|
17,442
|
|
|
—
|
|
|
(53
|
)
|
|
17,389
|
|
||||
Total marketable securities
|
$
|
64,471
|
|
|
$
|
10
|
|
|
$
|
(86
|
)
|
|
$
|
64,395
|
|
(1)
|
Included in amortized cost and fair value is purchased and accrued interest of
$629
.
|
|
Amortized
Cost (1)
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value (1)
|
||||||||
Current marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
$
|
39,306
|
|
|
$
|
14
|
|
|
$
|
(19
|
)
|
|
$
|
39,301
|
|
Commercial paper
|
2,000
|
|
|
—
|
|
|
—
|
|
|
2,000
|
|
||||
Certificates of deposit
|
7,262
|
|
|
—
|
|
|
(4
|
)
|
|
7,258
|
|
||||
Government municipal bonds
|
9,814
|
|
|
1
|
|
|
(2
|
)
|
|
9,813
|
|
||||
Current marketable securities
|
58,382
|
|
|
15
|
|
|
(25
|
)
|
|
58,372
|
|
||||
Non-current marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
2,019
|
|
|
—
|
|
|
(3
|
)
|
|
2,016
|
|
||||
Total marketable securities
|
$
|
60,401
|
|
|
$
|
15
|
|
|
$
|
(28
|
)
|
|
$
|
60,388
|
|
(1)
|
Included in amortized cost and fair value is purchased and accrued interest of
$485
.
|
|
September 30, 2013
|
||||||||||||||
|
Less than 12 Months
|
|
More than 12 Months
|
||||||||||||
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||
Corporate bonds
|
$
|
29,911
|
|
|
$
|
(35
|
)
|
|
$
|
2,001
|
|
|
$
|
(1
|
)
|
Certificates of deposit
|
12,451
|
|
|
(49
|
)
|
|
—
|
|
|
—
|
|
||||
Government municipal bonds
|
6,182
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
48,544
|
|
|
$
|
(85
|
)
|
|
$
|
2,001
|
|
|
$
|
(1
|
)
|
|
September 30, 2012
|
||||||||||||||
|
Less than 12 Months
|
|
More than 12 Months
|
||||||||||||
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||
Corporate bonds
|
$
|
6,246
|
|
|
$
|
(22
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial paper
|
2,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Certificates of deposit
|
5,114
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||
Government municipal bonds
|
21,143
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
34,503
|
|
|
$
|
(28
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
•
|
Level 1 — Inputs are quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2 — Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly.
|
•
|
Level 3 — Inputs are unobservable for the asset or liability and their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. Level 3 may also include certain investment securities for which there is limited market activity or a decrease in the observability of market pricing for the investments, such that the determination of fair value requires significant judgment or estimation.
|
|
|
|
Fair Value Measurements at September 30, 2013 using:
|
||||||||||||
|
Total carrying
value at
September 30, 2013
|
|
Quoted price in
active markets
(Level 1)
|
|
Significant other
observable inputs
(Level 2)
|
|
Significant
unobservable inputs
(Level 3)
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market
|
$
|
3,957
|
|
|
$
|
3,957
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Available-for-sale marketable securities:
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
41,574
|
|
|
—
|
|
|
41,574
|
|
|
—
|
|
||||
Certificates of deposit
|
12,707
|
|
|
—
|
|
|
12,707
|
|
|
—
|
|
||||
Government municipal bonds
|
10,114
|
|
|
—
|
|
|
10,114
|
|
|
—
|
|
||||
Total cash equivalents and marketable
securities measured at fair value
|
$
|
68,352
|
|
|
$
|
3,957
|
|
|
$
|
64,395
|
|
|
$
|
—
|
|
|
Balance at
|
|
Warranties
|
|
Settlements
|
|
Balance at
|
||||||||
Fiscal year
|
October 1
|
|
issued
|
|
made
|
|
September 30
|
||||||||
2013
|
$
|
1,021
|
|
|
$
|
669
|
|
|
$
|
(627
|
)
|
|
$
|
1,063
|
|
2012
|
$
|
941
|
|
|
$
|
730
|
|
|
$
|
(650
|
)
|
|
$
|
1,021
|
|
2011
|
$
|
877
|
|
|
$
|
885
|
|
|
$
|
(821
|
)
|
|
$
|
941
|
|
|
Employee
Termination
Costs
|
|
Other
|
|
Total
|
||||||
Balance at September 30, 2012
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restructuring charge
|
350
|
|
|
—
|
|
|
350
|
|
|||
Balance at September 30, 2013
|
$
|
350
|
|
|
$
|
—
|
|
|
$
|
350
|
|
|
Employee
Termination
Costs
|
|
Other
|
|
Total
|
||||||
Balance at September 30, 2011
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restructuring charge
|
568
|
|
|
395
|
|
|
963
|
|
|||
Payments
|
(555
|
)
|
|
(287
|
)
|
|
(842
|
)
|
|||
Balance at September 30, 2012
|
13
|
|
|
108
|
|
|
121
|
|
|||
Payments
|
—
|
|
|
(84
|
)
|
|
(84
|
)
|
|||
Reversals
|
(13
|
)
|
|
(24
|
)
|
|
(37
|
)
|
|||
Balance at September 30, 2013
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
United States
|
$
|
(395
|
)
|
|
$
|
2,808
|
|
|
$
|
10,173
|
|
International
|
8,633
|
|
|
8,089
|
|
|
6,342
|
|
|||
Total income before income taxes
|
$
|
8,238
|
|
|
$
|
10,897
|
|
|
$
|
16,515
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
1,418
|
|
|
$
|
2,203
|
|
|
$
|
3,880
|
|
State
|
263
|
|
|
400
|
|
|
342
|
|
|||
Foreign
|
3,148
|
|
|
3,131
|
|
|
2,479
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
U.S.
|
(2,270
|
)
|
|
(2,229
|
)
|
|
(776
|
)
|
|||
Foreign
|
(126
|
)
|
|
(223
|
)
|
|
(429
|
)
|
|||
Total income tax provision
|
$
|
2,433
|
|
|
$
|
3,282
|
|
|
$
|
5,496
|
|
|
As of September 30,
|
||||||
|
2013
|
|
2012
|
||||
Current deferred tax asset
|
$
|
3,174
|
|
|
$
|
3,389
|
|
Non-current deferred tax asset
|
5,832
|
|
|
5,010
|
|
||
Current deferred tax liability
|
(60
|
)
|
|
(16
|
)
|
||
Non-current deferred tax liability
|
(415
|
)
|
|
(630
|
)
|
||
Net deferred tax asset
|
$
|
8,531
|
|
|
$
|
7,753
|
|
|
|
|
|
||||
Uncollectible accounts and other reserves
|
$
|
1,138
|
|
|
$
|
1,820
|
|
Depreciation and amortization
|
255
|
|
|
13
|
|
||
Inventories
|
1,530
|
|
|
1,263
|
|
||
Compensation costs
|
8,025
|
|
|
7,034
|
|
||
Tax carryforwards
|
705
|
|
|
679
|
|
||
Valuation allowance
|
(515
|
)
|
|
(499
|
)
|
||
Identifiable intangible assets
|
(2,607
|
)
|
|
(2,557
|
)
|
||
Net deferred tax asset
|
$
|
8,531
|
|
|
$
|
7,753
|
|
|
Fiscal years ended September 30,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Statutory income tax rate
|
34.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Increase (decrease) resulting from:
|
|
|
|
|
|
|||
State taxes, net of federal benefits
|
(0.4
|
)%
|
|
0.7
|
%
|
|
0.5
|
%
|
Utilization of tax credits
|
(7.3
|
)%
|
|
(2.2
|
)%
|
|
(1.4
|
)%
|
Manufacturing deduction
|
(0.8
|
)%
|
|
0.2
|
%
|
|
(3.1
|
)%
|
Discrete tax benefits
|
(9.2
|
)%
|
|
(14.1
|
)%
|
|
(4.4
|
)%
|
Foreign operations
|
2.0
|
%
|
|
3.7
|
%
|
|
1.1
|
%
|
Adjustment of tax contingency reserves
|
9.7
|
%
|
|
4.9
|
%
|
|
2.6
|
%
|
Other, net
|
1.5
|
%
|
|
1.9
|
%
|
|
3.0
|
%
|
Effective income tax rate
|
29.5
|
%
|
|
30.1
|
%
|
|
33.3
|
%
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Unrecognized tax benefits at beginning of fiscal year
|
$
|
2,720
|
|
|
$
|
2,061
|
|
|
$
|
2,265
|
|
Increases related to:
|
|
|
|
|
|
||||||
Prior year income tax positions
|
162
|
|
|
631
|
|
|
32
|
|
|||
Current year income tax positions
|
733
|
|
|
441
|
|
|
392
|
|
|||
Decreases related to:
|
|
|
|
|
|
||||||
Prior year income tax positions
|
—
|
|
|
(94
|
)
|
|
—
|
|
|||
Expiration of statute of limitations
|
(283
|
)
|
|
(319
|
)
|
|
(628
|
)
|
|||
Unrecognized tax benefits at end of fiscal year
|
$
|
3,332
|
|
|
$
|
2,720
|
|
|
$
|
2,061
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Cost of sales
|
$
|
183
|
|
|
$
|
166
|
|
|
$
|
136
|
|
Sales and marketing
|
1,261
|
|
|
1,271
|
|
|
1,156
|
|
|||
Research and development
|
772
|
|
|
724
|
|
|
771
|
|
|||
General and administrative
|
1,556
|
|
|
1,566
|
|
|
1,381
|
|
|||
Stock-based compensation before income taxes
|
3,772
|
|
|
3,727
|
|
|
3,444
|
|
|||
Income tax benefit
|
(1,192
|
)
|
|
(1,240
|
)
|
|
(1,143
|
)
|
|||
Stock-based compensation after income taxes
|
$
|
2,580
|
|
|
$
|
2,487
|
|
|
$
|
2,301
|
|
|
|
Options Outstanding
|
|
Weighted Average Exercised Price
|
|
Weighted Average Contractual Term (in years)
|
|
Aggregate Intrinsic Value (1)
|
|||
Balance at September 30, 2012
|
|
5,754
|
|
|
$10.76
|
|
|
|
|
||
Additional shares approved for grant
|
|
|
|
|
|
|
|
|
|||
Granted
|
|
1,049
|
|
|
9.33
|
|
|
|
|
||
Exercised
|
|
(280
|
)
|
|
9.76
|
|
|
|
|
||
Cancelled
|
|
(244
|
)
|
|
10.35
|
|
|
|
|
||
Balance at September 30, 2013
|
|
6,279
|
|
|
$10.67
|
|
5.6
|
|
$
|
3,152
|
|
|
|
|
|
|
|
|
|
|
|||
Exercisable at September 30, 2013
|
|
4,562
|
|
|
$11.00
|
|
4.6
|
|
$
|
2,357
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Fair value of options granted (in thousands)
|
$
|
3,950
|
|
|
$
|
4,086
|
|
|
$
|
4,948
|
|
Weighted average per option grant date fair value
|
$
|
3.77
|
|
|
$
|
4.45
|
|
|
$
|
4.14
|
|
Assumptions used for option grants:
|
|
|
|
|
|
||||||
Risk free interest rate
|
0.88% - 1.78%
|
|
0.84% - 1.33%
|
|
1.58% - 2.14%
|
||||||
Expected term
|
6.25 years
|
|
6.25 years
|
|
5.25 years
|
||||||
Expected volatility
|
40%
|
|
41% - 42%
|
|
41% - 44%
|
||||||
Weighted average volatility
|
40%
|
|
41%
|
|
43%
|
||||||
Expected dividend yield
|
0
|
|
0
|
|
0
|
|
Number of Options
|
|
Weighted Average Grant Date Fair Value per Common Share
|
|||
Nonvested at September 30, 2012
|
1,756
|
|
|
$
|
3.58
|
|
Granted
|
1,049
|
|
|
$
|
3.77
|
|
Vested
|
(844
|
)
|
|
$
|
3.71
|
|
Forfeited
|
(244
|
)
|
|
$
|
4.05
|
|
Nonvested at September 30, 2013
|
1,717
|
|
|
$
|
3.56
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Range of Exercise Prices
|
|
Options Outstanding
|
|
Weighted Average Remaining Contractual Life (In Years)
|
|
Weighted Average Exercise Price
|
|
Number of Shares Vested
|
|
Weighted Average Exercise Price
|
||||||
$6.75 - $8.03
|
|
752
|
|
|
6.03
|
|
$
|
8.01
|
|
|
726
|
|
|
$
|
8.01
|
|
$8.04 - $9.50
|
|
1,312
|
|
|
7.48
|
|
$
|
9.02
|
|
|
440
|
|
|
$
|
8.49
|
|
$9.51 - $10.00
|
|
1,274
|
|
|
5.99
|
|
$
|
9.68
|
|
|
905
|
|
|
$
|
9.70
|
|
$10.01 - $11.00
|
|
1,183
|
|
|
6.15
|
|
$
|
10.65
|
|
|
786
|
|
|
$
|
10.66
|
|
$11.01 - $13.00
|
|
616
|
|
|
3.64
|
|
$
|
12.36
|
|
|
594
|
|
|
$
|
12.37
|
|
$13.01 - $15.00
|
|
656
|
|
|
2.61
|
|
$
|
13.98
|
|
|
626
|
|
|
$
|
13.95
|
|
$15.01 - $16.88
|
|
486
|
|
|
3.47
|
|
$
|
15.27
|
|
|
485
|
|
|
$
|
15.27
|
|
$6.75 - $16.88
|
|
6,279
|
|
|
5.56
|
|
$
|
10.67
|
|
|
4,562
|
|
|
$
|
11.00
|
|
|
Number of Options
|
|
Weighted Average Grant Date Fair Value per Common Share
|
|||
Nonvested at September 30, 2012
|
—
|
|
|
$
|
—
|
|
Granted
|
49
|
|
|
$
|
9.71
|
|
Vested
|
—
|
|
|
$
|
—
|
|
Forfeited
|
—
|
|
|
$
|
—
|
|
Nonvested at September 30, 2013
|
49
|
|
|
$
|
9.71
|
|
Fiscal year
|
|
Amount
|
||
2014
|
|
$
|
2,527
|
|
2015
|
|
1,714
|
|
|
2016
|
|
1,072
|
|
|
2017
|
|
234
|
|
|
2018
|
|
2
|
|
|
Thereafter
|
|
—
|
|
|
Total minimum payments required
|
|
$
|
5,549
|
|
|
Fiscal years ended September 30,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Rentals
|
$
|
3,053
|
|
|
$
|
3,093
|
|
|
$
|
3,275
|
|
Less: sublease rentals
|
(31
|
)
|
|
(41
|
)
|
|
(17
|
)
|
|||
Total rental expense
|
$
|
3,022
|
|
|
$
|
3,052
|
|
|
$
|
3,258
|
|
|
Quarter ended
|
||||||||||||||
|
Dec. 31
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
||||||||
Fiscal 2013
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
46,991
|
|
|
$
|
48,197
|
|
|
$
|
48,824
|
|
|
$
|
51,369
|
|
Gross profit
|
24,479
|
|
|
24,961
|
|
|
24,720
|
|
|
25,963
|
|
||||
Net income (1)(2)(3)(4)
|
1,230
|
|
|
1,000
|
|
|
1,528
|
|
|
2,047
|
|
||||
Net income per common share - basic
|
0.05
|
|
|
0.04
|
|
|
0.06
|
|
|
0.08
|
|
||||
Net income per common share - diluted
|
0.05
|
|
|
0.04
|
|
|
0.06
|
|
|
0.08
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Fiscal 2012
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
46,662
|
|
|
$
|
49,016
|
|
|
$
|
47,632
|
|
|
$
|
47,248
|
|
Gross profit
|
24,430
|
|
|
25,783
|
|
|
25,304
|
|
|
24,820
|
|
||||
Net income (1)(2)
|
724
|
|
|
2,122
|
|
|
2,307
|
|
|
2,462
|
|
||||
Net income per common share - basic
|
0.03
|
|
|
0.08
|
|
|
0.09
|
|
|
0.10
|
|
||||
Net income per common share - diluted
|
0.03
|
|
|
0.08
|
|
|
0.09
|
|
|
0.09
|
|
(1)
|
During fiscal 2013 and 2012, we recorded discrete tax benefits of
$0.8 million
and
$1.5 million
, respectively. We recorded a benefit of
$0.1 million
in the first quarter of fiscal 2013 resulting from the release of income tax reserves due to the expiration of the statute of limitations from various U.S. and foreign tax jurisdictions. During the second quarter of fiscal 2013, we recorded a discrete tax benefit of
$0.4 million
resulting from the enactment of legislation on January 2, 2013 extending the research and development credit for the last three quarters of fiscal 2012. In the third quarter of fiscal 2013, we recorded a benefit of
$0.1 million
for the release of income tax reserves due to the expiration of the statute of limitations for U.S. Federal income tax for fiscal 2009. In the fourth quarter of fiscal 2013, we recorded
$0.2 million
for the reversal of tax reserves resulting from expiration of the statute of limitations for state income taxes.
|
(2)
|
During fiscal 2013, we recorded a business restructuring accrual of
$0.4 million
(
$0.2 million
after tax) in the fourth quarter of fiscal 2013. During fiscal 2012, we recorded a business restructuring accrual of
$0.2 million
(
$0.2 million
after tax) in the first quarter,
$0.1 million
(
$0.0 million
after tax) in the second quarter and
$1.0 million
(
$0.6 million
after tax) in the third quarter.
|
(3)
|
During the second quarter of fiscal 2013, we recorded a charge of
$1.5 million
(
$1.0 million
after tax) for the settlement of a patent infringement lawsuit.
|
(4)
|
During the fourth quarter of fiscal 2013, we recorded a charge of
$0.4 million
(
$0.2 million
after tax) for impairment of certain intangibles.
|
Name
|
|
Age
|
|
Position
|
Joseph T. Dunsmore
|
|
55
|
|
Chairman, President and Chief Executive Officer
|
Steven E. Snyder
|
|
57
|
|
Senior Vice President, Chief Financial Officer and Treasurer
|
Michael R. Dannenfeldt
|
|
36
|
|
Senior Vice President, Etherios Solutions
|
Jon A. Nyland
|
|
50
|
|
Vice President Manufacturing Operations
|
Kevin C. Riley
|
|
52
|
|
Senior Vice President of Global Sales
|
Tracy L. Roberts
|
|
51
|
|
Vice President of Human Resources and Information Technology
|
David H. Sampsell
|
|
45
|
|
Vice President, General Counsel and Corporate Secretary
|
Joel K. Young
|
|
48
|
|
Senior Vice President of Research and Development and Chief Technical Officer
|
(1)
|
Incorporated by reference to Exhibit 3(a) to the Company's Form 10‑K for the year ended September 30, 1993 (File no. 0‑17972).
|
(2)
|
Incorporated by reference to Exhibit 3 to the Company's Form 8-K dated January 18, 2011 (File no. 1‑34033).
|
(3)
|
Incorporated by reference to Exhibit 4(a) to the Company's Registration Statement on Form 8-A filed on April 25, 2008 (File no. 1‑34033).
|
(4)
|
Incorporated by reference to Exhibit 4(b) to the Company's Registration Statement on Form 8-A filed on April 25, 2008 (File no. 1‑34033).
|
(5)
|
Incorporated by reference to Exhibit 10(a) to the Company's Form 10‑Q for the quarter ended March 31, 2008 (File no. 1‑34033).
|
(6)
|
Incorporated by reference to Exhibit 10(a) to the Company's Form 10‑K for the year ended September 30, 2006 (File no. 0‑17972).
|
(7)
|
Incorporated by reference to Exhibit 10(a) to the Company's Form 8-K dated September 13, 2004 (File no. 0‑17972).
|
(8)
|
Incorporated by reference to Exhibit 10(g) to the Company's Form 10‑K for the year ended September 30, 2006 (File no. 0‑17972).
|
(9)
|
Incorporated by reference to Exhibit 10(b) to the Company's Form 10‑Q for the quarter ended December 31, 2009 (File no. 1‑34033).
|
(10)
|
Incorporated by reference to Exhibit 10(a) to the Company's Form 10‑Q for the quarter ended December 31, 2009 (File no. 1‑34033).
|
(11)
|
Incorporated by reference to Exhibit 10(o) to the Company's Form 10‑K for the year ended September 30, 2008 (File no. 1‑34033).
|
(12)
|
Incorporated by reference to Exhibit 10 (e)ii to the Company's Form 10‑Q for the year ended September 30, 2011 (File no. 1‑34033).
|
(13)
|
Incorporated by reference to Exhibit 99 to the Company's Registration Statement on Form S-8 filed on April 16, 2013 (File no. 333-187949).
|
(14)
|
Incorporated by reference to Exhibit 10(a)(i) to the Company's Form 10-Q for the quarter ended March 31, 2013 (File no. 1-34033).
|
(15)
|
Incorporated by reference to Exhibit 10(a)(ii) to the Company's Form 10-Q for the quarter ended March 31, 2013 (File no. 1-34033).
|
(16)
|
Incorporated by reference to Exhibit 10 to the Company's Form 10‑Q for the quarter ended June 30, 2010 (File no. 1‑34033).
|
(17)
|
Incorporated by reference to Exhibit 10(m) to the Company's Form 10‑K for the year ended September 30, 2006 (File no. 0‑17972).
|
(18)
|
Incorporated by reference to Exhibit 10(a) to the Company's Form 10‑Q for the quarter ended June 30, 2007 (File no. 0‑17972).
|
(19)
|
Incorporated by reference to Exhibit 10(d) to the Company's Form 10‑K for the year ended September 30, 2006 (File no. 0‑17972).
|
(20)
|
Incorporated by reference to Exhibit 10(b) to the Company's Form 10‑Q for the quarter ended June 30, 2007 (File no. 0‑17972).
|
(21)
|
Incorporated by reference to Exhibit 10 to the Company's Form 10‑Q for the quarter ended December 31, 2010 (File no. 1‑34033).
|
|
DIGI INTERNATIONAL INC.
|
|
By:
/s/ Joseph T. Dunsmore
Joseph T. Dunsmore
Chairman, President, Chief Executive Officer and Director
|
|
By:
/s/ Joseph T. Dunsmore
Joseph T. Dunsmore
Chairman, President, Chief Executive Officer and Director
(Principal Executive Officer)
|
|
By:
/s/ Steven E. Snyder
Steven E. Snyder
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer and Principal Accounting Officer)
|
|
By:
*
Guy C. Jackson
Director
|
|
By:
*
Satbir Khanuja
Director
|
|
By:
*
Kenneth E. Millard
Director
|
|
By:
*
Ahmed Nawaz
Director
|
|
By:
*
William N. Priesmeyer
Director
|
|
By:
*
Girish Rishi
Director
|
*
|
Joseph T. Dunsmore, by signing his name hereto, does hereby sign this document on behalf of each of the above named directors of the Registrant pursuant to Powers of Attorney duly executed by such persons.
|
|
By:
/s/ Joseph T. Dunsmore
Joseph T. Dunsmore
Attorney-in-fact
|
Description
|
|
Balance at beginning of period
|
|
Increase (Decrease) to costs and expenses
|
|
Deductions
|
|
|
Balance at end of period
|
||||||||
Valuation account - doubtful accounts
|
|
|
|
|
|
|
|
|
|
||||||||
September 30, 2013
|
|
$
|
295
|
|
|
$
|
309
|
|
|
$
|
291
|
|
(1)
|
|
$
|
313
|
|
September 30, 2012
|
|
$
|
339
|
|
|
$
|
418
|
|
|
$
|
462
|
|
(1)
|
|
$
|
295
|
|
September 30, 2011
|
|
$
|
549
|
|
|
$
|
(96
|
)
|
|
$
|
114
|
|
(1)
|
|
$
|
339
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reserve for future returns and pricing adjustments
|
|
|
|
|
|
|
|
|
|
||||||||
September 30, 2013
|
|
$
|
1,362
|
|
|
$
|
6,973
|
|
|
$
|
6,565
|
|
|
|
$
|
1,770
|
|
September 30, 2012
|
|
$
|
1,280
|
|
|
$
|
4,881
|
|
|
$
|
4,799
|
|
|
|
$
|
1,362
|
|
September 30, 2011
|
|
$
|
1,106
|
|
|
$
|
5,156
|
|
|
$
|
4,982
|
|
|
|
$
|
1,280
|
|
(1)
|
Uncollectible accounts charged against allowance, net of recoveries
|
Exhibit Number
|
|
Description
|
Method of Filing
|
||
3
|
|
(a)
|
|
Restated Certificate of Incorporation of the Company, as amended
|
Incorporation by Reference
|
|
|
|
|
|
|
3
|
|
(b)
|
|
Amended and Restated By-Laws of the Company
|
Incorporation by Reference
|
|
|
|
|
|
|
4
|
|
(a)
|
|
Share Rights Agreement, dated as of April 22, 2008, between the Company and Wells Fargo Bank, N.A., as Rights Agent
|
Incorporation by Reference
|
|
|
|
|
|
|
4
|
|
(b)
|
|
Form of Amended and Restated Certificate of Powers, Designations, Preferences and Rights of Series A Junior Participating Preferred Shares
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(a)
|
|
English Language Summary of Sale and Leaseback Agreement dated February 18, 2008 between Digi International GmbH and Deutsche Structured Finance GmbH & Co. Alphard KG
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(b)
|
|
Digi International Inc. Stock Option Plan as Amended and Restated as of November 27, 2006
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(b)(i)
|
|
Form of Notice of Grant of Stock Options and Option Agreement
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(c)
|
|
Digi International Inc. Non-Officer Stock Option Plan, as Amended and Restated as of November 27, 2006
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(d)
|
|
Digi International Inc. Employee Stock Purchase Plan, as amended and restated as of December 4, 2009
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(e)
|
|
Digi International Inc. 2000 Omnibus Stock Plan, as amended and restated as of December 4, 2009
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(e)(i)
|
|
Form of Notice of Grant of Stock Options and Option Agreement
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(e)(ii)
|
|
Form of Notice of Grant of Stock Options and Option Agreement
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(f)
|
|
Digi International Inc. 2013 Omnibus Incentive Plan
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(f)(i)
|
|
Form of Notice of Grant of Stock Options and Option Agreement including Addendums to Option Agreement that may apply to certain grants
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(f)(ii)
|
|
Form of (Director) Restricted Stock Unit Award Agreement
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(g)
|
|
Form of indemnification agreement with directors and officers of the Company
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(h)
|
|
Agreement between the Company and Lawrence A. Kraft, dated February 4, 2003
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(h)(i)
|
|
Amendment to Agreement between the Company and Lawrence A. Kraft dated July 30, 2007
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(i)
|
|
Employment Agreement between the Company and Joseph T. Dunsmore dated September 27, 2006
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(j)
|
|
Agreement between the Company and Joel K. Young dated July 30, 2007
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(k)
|
|
Offer Letter Agreement, dated as of October 28, 2010 between the Company and Steven E. Snyder
|
Incorporation by Reference
|
|
|
|
|
|
|
10
|
|
(l)
|
|
Agreement between the Company and Jon A. Nyland dated September 17, 2013
|
Electronically
|
|
|
|
|
|
Exhibit Number
|
|
Description
|
Method of Filing
|
||
|
|
|
|
|
|
10
|
|
(m)
|
|
Offer Letter Agreement, dated as of April 8, 2011 between the Company and David H. Sampsell
|
Electronically
|
|
|
|
|
|
|
21
|
|
|
|
Subsidiaries of the Company
|
Electronically
|
|
|
|
|
|
|
23
|
|
|
|
Consent of Independent Registered Public Accounting Firm
|
Electronically
|
|
|
|
|
|
|
24
|
|
|
|
Powers of Attorney
|
Electronically
|
|
|
|
|
|
|
31
|
|
(a)
|
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
|
Electronically
|
|
|
|
|
|
|
31
|
|
(b)
|
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
|
Electronically
|
|
|
|
|
|
|
32
|
|
|
|
Section 1350 Certification
|
Electronically
|
|
|
|
|
|
|
101.INS
|
|
|
|
XBRL Instance Document
|
Electronically
|
|
|
|
|
|
|
101.SCH
|
|
|
|
XBRL Taxonomy Extension Schema Document
|
Electronically
|
|
|
|
|
|
|
101.CAL
|
|
|
|
XBRL Taxonomy Calculation Linkbase Document
|
Electronically
|
|
|
|
|
|
|
101.DEF
|
|
|
|
XBRL Taxonomy Definition Linkbase Document
|
Electronically
|
|
|
|
|
|
|
101.LAB
|
|
|
|
XBRL Taxonomy Label Linkbase Document
|
Electronically
|
|
|
|
|
|
|
101.PRE
|
|
|
|
XBRL Taxonomy Presentation Linkbase Document
|
Electronically
|
1.
|
Six months of base salary in effect at the time of termination. This shall be paid in a lump sum as soon as administratively feasible after the later of the date of termination or the date the release of claims has become irrevocable.
|
2.
|
A pro-rata bonus based on number of months worked in the fiscal year prior to a qualifying termination and the Company’s actual performance against annual objections. This pro-rata bonus shall be paid no later than 2.5 months after the close of the fiscal year in which the qualifying termination occurs.
|
/s/ Joseph T. Dunsmore
|
Joseph T. Dunsmore
|
/s/ Steven E. Snyder
|
Steven E. Snyder
|
/s/ Guy C. Jackson
|
Guy C. Jackson
|
/s/ Kenneth E. Millard
|
Kenneth E. Millard
|
/s/ Ahmed Nawaz
|
Ahmed Nawaz
|
/s/ William N. Priesmeyer
|
William N. Priesmeyer
|
/s/ Satbir Khanuja, Ph.D.
|
Satbir Khanuja, Ph.D.
|
/s/ Girish D. Rishi
|
Girish D. Rishi
|
|
||||
|
|
|
|
|
|
|
|
|
|
November 22, 2013
|
/s/ Joseph T. Dunsmore
|
|
||
|
Joseph T. Dunsmore
|
|
||
|
President, Chief Executive Officer and Chairman
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
November 22, 2013
|
/s/ Steven E. Snyder
|
|
||
|
Steven E. Snyder
|
|
||
|
Senior Vice President, Chief Financial Officer and Treasurer
|
|
|
||||
|
|
|
|
|
November 22, 2013
|
|
|
|
|
|
/s/ Joseph T. Dunsmore
|
|
||
|
Joseph T. Dunsmore
|
|
||
|
President, Chief Executive Officer, and Chairman
|
|
||
|
||||
November 22, 2013
|
|
|
||
|
/s/ Steven E. Snyder
|
|
||
|
Steven E. Snyder
|
|
||
|
Senior Vice President, Chief Financial Officer and Treasurer
|
|