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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For the transition period from ________ to _________
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Delaware
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52-1762325
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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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One Technology Park Drive
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Westford, Massachusetts
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01886
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a smaller reporting company)
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Smaller reporting company
o
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Emerging growth company
o
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Class
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Outstanding at April 27, 2018
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Common Stock, $.01 par value
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11,090,209
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Page
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PART I: Financial Information
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PART II: Other Information
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March 31,
2018 |
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December 30,
2017 |
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(In thousands, except share and per share amounts)
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Assets
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Current Assets:
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Cash and cash equivalents
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$
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72,210
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$
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75,425
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Restricted cash (Note 1)
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1,532
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1,421
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Accounts receivable, less allowances of $3,216 and $2,879 (Note 1)
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91,529
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89,624
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Inventories (Note 1)
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95,840
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84,933
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Unbilled revenue
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2,375
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2,374
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Other current assets
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14,429
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12,246
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Total Current Assets
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277,915
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266,023
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Property, Plant, and Equipment, at Cost
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169,523
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165,231
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Less: accumulated depreciation and amortization
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88,851
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85,508
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Property, Plant, and Equipment, at Cost, Net
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80,672
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79,723
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Other Assets
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14,541
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14,311
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Intangible Assets, Net (Note 1)
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129,635
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133,036
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Goodwill (Note 1)
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269,514
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268,001
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Total Assets
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$
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772,277
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$
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761,094
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Liabilities and Stockholders' Equity
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Current Liabilities:
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Current maturities of long-term obligations (Note 5)
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$
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710
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$
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696
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Accounts payable
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37,026
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35,461
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Customer deposits
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40,034
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30,103
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Accrued payroll and employee benefits
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23,400
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29,616
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Advanced billings
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5,745
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7,316
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Other current liabilities
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25,274
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29,038
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Total Current Liabilities
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132,189
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132,230
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Long-Term Obligations (Note 5)
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240,226
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241,384
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Long-Term Deferred Income Taxes
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29,125
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29,085
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Other Long-Term Liabilities
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25,510
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25,891
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Commitments and Contingencies (Note 12)
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Stockholders' Equity:
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Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued
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—
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—
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Common stock, $.01 par value, 150,000,000 shares authorized; 14,624,159 shares issued
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146
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146
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Capital in excess of par value
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99,828
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103,221
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Retained earnings
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351,355
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342,893
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Treasury stock at cost, 3,533,950 and 3,613,838 shares
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(86,596
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)
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(88,554
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)
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Accumulated other comprehensive items (Note 8)
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(21,212
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)
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(26,715
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)
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Total Kadant Stockholders' Equity
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343,521
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330,991
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Noncontrolling interest
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1,706
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1,513
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Total Stockholders' Equity
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345,227
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332,504
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Total Liabilities and Stockholders' Equity
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$
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772,277
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$
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761,094
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Three Months Ended
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March 31,
2018 |
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April 1,
2017 |
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(In thousands, except per share amounts)
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Revenues (Note 11)
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$
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149,193
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$
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102,857
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Costs and Operating Expenses:
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Cost of revenues
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83,114
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53,840
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Selling, general, and administrative expenses
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45,776
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34,620
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Research and development expenses
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2,869
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2,147
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Restructuring costs (Note 2)
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770
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—
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132,529
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90,607
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Operating Income
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16,664
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12,250
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Interest Income
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183
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104
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Interest Expense
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(1,732
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)
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(348
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)
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Other Expense, Net (Note 7)
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(246
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)
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(204
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)
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Income Before Provision for Income Taxes
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14,869
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11,802
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Provision for Income Taxes (Note 4)
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3,861
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2,735
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Net Income
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11,008
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9,067
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Net Income Attributable to Noncontrolling Interest
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(150
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(116
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Net Income Attributable to Kadant
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$
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10,858
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$
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8,951
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Earnings per Share Attributable to Kadant (Note 3):
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Basic
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$
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0.98
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$
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0.82
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Diluted
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$
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0.96
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$
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0.80
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Weighted Average Shares (Note 3):
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Basic
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11,042
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10,952
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Diluted
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11,342
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11,205
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Cash Dividend Declared per Common Share
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$
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0.22
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$
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0.21
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Three Months Ended
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March 31,
2018 |
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April 1,
2017 |
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(In thousands)
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Net Income
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$
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11,008
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$
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9,067
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Other Comprehensive Items:
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Foreign currency translation adjustment
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5,336
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5,032
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Pension and other post-retirement liability adjustments, net (net of tax provision of $34 and $49)
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117
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82
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Deferred gain on cash flow hedges (net of tax provision of $8 and $15)
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93
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27
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Other Comprehensive Items
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5,546
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5,141
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Comprehensive Income
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16,554
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14,208
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Comprehensive Income Attributable to Noncontrolling Interest
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(193
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)
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(162
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)
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Comprehensive Income Attributable to Kadant
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$
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16,361
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$
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14,046
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Three Months Ended
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March 31,
2018 |
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April 1,
2017 |
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(In thousands)
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Operating Activities
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Net income attributable to Kadant
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$
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10,858
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$
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8,951
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Net income attributable to noncontrolling interest
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150
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116
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Net income
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11,008
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9,067
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Adjustments to reconcile net income to net cash provided by operating activities:
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Depreciation and amortization
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6,099
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3,256
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Stock-based compensation expense
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1,464
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|
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1,295
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Provision for losses on accounts receivable
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316
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129
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Loss on the sale of property, plant, and equipment
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24
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41
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Other items, net
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(386
|
)
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180
|
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Contributions to U.S. pension plan
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—
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(90
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)
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Changes in current assets and liabilities, net of effects of acquisitions:
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Accounts receivable
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(799
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)
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(5,043
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)
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Unbilled revenue
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2,064
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(1,134
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)
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Inventories
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(9,674
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)
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(3,964
|
)
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Other current assets
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(435
|
)
|
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(1,886
|
)
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Accounts payable
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3,854
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|
805
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Other current liabilities
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(6,319
|
)
|
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(973
|
)
|
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Net cash provided by operating activities
|
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7,216
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|
|
1,683
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Investing Activities
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Purchases of property, plant, and equipment
|
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(5,151
|
)
|
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(1,722
|
)
|
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Acquisition
|
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—
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|
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(165
|
)
|
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Proceeds from sale of property, plant, and equipment
|
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28
|
|
|
—
|
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Other investing activities
|
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—
|
|
|
(2
|
)
|
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Net cash used in investing activities
|
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(5,123
|
)
|
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(1,889
|
)
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Financing Activities
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Repayment of debt
|
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(13,382
|
)
|
|
(4,610
|
)
|
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Proceeds from issuance of debt
|
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12,000
|
|
|
8,000
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|
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Tax withholding payments related to stock-based compensation
|
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(3,641
|
)
|
|
(2,182
|
)
|
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Dividends paid
|
|
(2,316
|
)
|
|
(2,078
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)
|
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Proceeds from issuance of Company common stock
|
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742
|
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—
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Payment of debt issuance costs
|
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—
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|
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(654
|
)
|
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Other financing activities
|
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(111
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)
|
|
(118
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)
|
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Net cash used in financing activities
|
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(6,708
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)
|
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(1,642
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)
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Exchange Rate Effect on Cash, Cash Equivalents, and Restricted Cash
|
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1,511
|
|
|
1,362
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Decrease in Cash, Cash Equivalents, and Restricted Cash
|
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(3,104
|
)
|
|
(486
|
)
|
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Cash, Cash Equivalents, and Restricted Cash at Beginning of Period
|
|
76,846
|
|
|
73,569
|
|
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Cash, Cash Equivalents, and Restricted Cash at End of Period
|
|
$
|
73,742
|
|
|
$
|
73,083
|
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(In thousands, except share amounts)
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Common
Stock
|
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Capital in
Excess of Par Value
|
|
Retained Earnings
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive Items
|
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Noncontrolling Interest
|
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Total
Stockholders' Equity
|
||||||||||||||||||||
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Shares
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Amount
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Shares
|
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Amount
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Balance at December 31, 2016
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
101,405
|
|
|
$
|
321,050
|
|
|
3,686,532
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|
|
$
|
(90,335
|
)
|
|
$
|
(49,637
|
)
|
|
$
|
1,650
|
|
|
$
|
284,279
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,951
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
116
|
|
|
9,067
|
|
|||||||
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|
|
|
|
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|
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|
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Dividend declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,310
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,310
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Activity under stock plans
|
|
—
|
|
|
—
|
|
|
(2,431
|
)
|
|
—
|
|
|
(63,020
|
)
|
|
1,544
|
|
|
—
|
|
|
—
|
|
|
(887
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other comprehensive items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,095
|
|
|
46
|
|
|
5,141
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at April 1, 2017
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
98,974
|
|
|
$
|
327,691
|
|
|
3,623,512
|
|
|
$
|
(88,791
|
)
|
|
$
|
(44,542
|
)
|
|
$
|
1,812
|
|
|
$
|
295,290
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at December 30, 2017
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
103,221
|
|
|
$
|
342,893
|
|
|
3,613,838
|
|
|
$
|
(88,554
|
)
|
|
$
|
(26,715
|
)
|
|
$
|
1,513
|
|
|
$
|
332,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,858
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
150
|
|
|
11,008
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adoption of ASU No. 2014-09 (Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
119
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
119
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adoption of ASU No. 2016-16 (Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(75
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(75
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Dividend declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,440
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,440
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Activity under stock plans
|
|
—
|
|
|
—
|
|
|
(3,393
|
)
|
|
—
|
|
|
(79,888
|
)
|
|
1,958
|
|
|
—
|
|
|
—
|
|
|
(1,435
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other comprehensive items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,503
|
|
|
43
|
|
|
5,546
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at March 31, 2018
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
99,828
|
|
|
$
|
351,355
|
|
|
3,533,950
|
|
|
$
|
(86,596
|
)
|
|
$
|
(21,212
|
)
|
|
$
|
1,706
|
|
|
$
|
345,227
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
March 31,
2018 |
|
April 1,
2017 |
||||
Cash Paid for Interest
|
|
$
|
2,459
|
|
|
$
|
388
|
|
Cash Paid for Income Taxes, Net of Refunds
|
|
$
|
8,455
|
|
|
$
|
3,774
|
|
|
|
|
|
|
||||
Non-Cash Investing Activities:
|
|
|
|
|
|
|
||
Estimated post-closing adjustment (a)
|
|
$
|
400
|
|
|
$
|
—
|
|
|
|
|
|
|
||||
Non-cash additions to property, plant and equipment
|
|
$
|
1,816
|
|
|
$
|
125
|
|
|
|
|
|
|
||||
Non-Cash Financing Activities:
|
|
|
|
|
|
|
||
Issuance of Company common stock upon vesting of restricted stock units
|
|
$
|
2,755
|
|
|
$
|
2,640
|
|
Dividends declared but unpaid
|
|
$
|
2,440
|
|
|
$
|
2,310
|
|
(In thousands)
|
|
March 31,
2018 |
|
April 1,
2017 |
|
December 30,
2017 |
|
December 31,
2016 |
||||||||
Cash and cash equivalents
|
|
$
|
72,210
|
|
|
$
|
71,540
|
|
|
$
|
75,425
|
|
|
$
|
71,487
|
|
Restricted cash
|
|
1,532
|
|
|
1,543
|
|
|
1,421
|
|
|
2,082
|
|
||||
Total Cash, Cash Equivalents, and Restricted Cash
|
|
$
|
73,742
|
|
|
$
|
73,083
|
|
|
$
|
76,846
|
|
|
$
|
73,569
|
|
|
|
March 31,
2018 |
|
December 30,
2017 |
||||
(In thousands)
|
|
|
||||||
Raw Materials and Supplies
|
|
$
|
42,582
|
|
|
$
|
38,952
|
|
Work in Process
|
|
22,395
|
|
|
18,203
|
|
||
Finished Goods
|
|
30,863
|
|
|
27,778
|
|
||
|
|
$
|
95,840
|
|
|
$
|
84,933
|
|
(In thousands)
|
|
Gross
|
|
Currency
Translation |
|
Accumulated
Amortization |
|
Net
|
||||||||
March 31, 2018
|
|
|
|
|
|
|
|
|
||||||||
Definite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
$
|
113,283
|
|
|
$
|
(419
|
)
|
|
$
|
(31,196
|
)
|
|
$
|
81,668
|
|
Product technology
|
|
46,501
|
|
|
(584
|
)
|
|
(20,797
|
)
|
|
25,120
|
|
||||
Tradenames
|
|
5,227
|
|
|
(218
|
)
|
|
(1,628
|
)
|
|
3,381
|
|
||||
Other
|
|
13,744
|
|
|
(28
|
)
|
|
(11,178
|
)
|
|
2,538
|
|
||||
|
|
178,755
|
|
|
(1,249
|
)
|
|
(64,799
|
)
|
|
112,707
|
|
||||
Indefinite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Tradenames
|
|
16,600
|
|
|
328
|
|
|
—
|
|
|
16,928
|
|
||||
Acquired Intangible Assets
|
|
$
|
195,355
|
|
|
$
|
(921
|
)
|
|
$
|
(64,799
|
)
|
|
$
|
129,635
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Definite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
$
|
113,301
|
|
|
$
|
(621
|
)
|
|
$
|
(28,789
|
)
|
|
$
|
83,891
|
|
Product technology
|
|
46,501
|
|
|
(737
|
)
|
|
(19,841
|
)
|
|
25,923
|
|
||||
Tradenames
|
|
5,227
|
|
|
(262
|
)
|
|
(1,504
|
)
|
|
3,461
|
|
||||
Other
|
|
13,754
|
|
|
(35
|
)
|
|
(10,863
|
)
|
|
2,856
|
|
||||
|
|
178,783
|
|
|
(1,655
|
)
|
|
(60,997
|
)
|
|
116,131
|
|
||||
Indefinite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Tradenames
|
|
16,600
|
|
|
305
|
|
|
—
|
|
|
16,905
|
|
||||
Acquired Intangible Assets
|
|
$
|
195,383
|
|
|
$
|
(1,350
|
)
|
|
$
|
(60,997
|
)
|
|
$
|
133,036
|
|
(In thousands)
|
|
Papermaking Systems Segment
|
|
Wood Processing Systems Segment
|
|
Total
|
||||||
Balance at December 30, 2017
|
|
|
|
|
|
|
||||||
Gross balance
|
|
$
|
247,014
|
|
|
$
|
106,496
|
|
|
$
|
353,510
|
|
Accumulated impairment losses
|
|
(85,509
|
)
|
|
—
|
|
|
(85,509
|
)
|
|||
Net balance
|
|
161,505
|
|
|
106,496
|
|
|
268,001
|
|
|||
2018 Adjustments
|
|
|
|
|
|
|
||||||
Acquisitions (a)
|
|
(309
|
)
|
|
(75
|
)
|
|
(384
|
)
|
|||
Currency translation
|
|
2,131
|
|
|
(234
|
)
|
|
1,897
|
|
|||
Total 2018 adjustments
|
|
1,822
|
|
|
(309
|
)
|
|
1,513
|
|
|||
Balance at March 31, 2018
|
|
|
|
|
|
|
|
|
|
|||
Gross balance
|
|
248,836
|
|
|
106,187
|
|
|
355,023
|
|
|||
Accumulated impairment losses
|
|
(85,509
|
)
|
|
—
|
|
|
(85,509
|
)
|
|||
Net balance
|
|
$
|
163,327
|
|
|
$
|
106,187
|
|
|
$
|
269,514
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
March 31,
2018 |
|
April 1,
2017 |
||||
Balance at December 30, 2017
|
|
$
|
5,498
|
|
|
$
|
3,843
|
|
Provision charged to expense
|
|
715
|
|
|
804
|
|
||
Usage
|
|
(364
|
)
|
|
(570
|
)
|
||
Currency translation
|
|
61
|
|
|
62
|
|
||
Balance at March 31, 2018
|
|
$
|
5,910
|
|
|
$
|
4,139
|
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
|
|
April 1,
|
||||
(In thousands)
|
|
2018
|
|
2017
|
||||
Revenues by Product Line:
|
|
|
|
|
||||
Papermaking Systems:
|
|
|
|
|
||||
Stock-Preparation
|
|
$
|
45,483
|
|
|
$
|
41,153
|
|
Doctoring, Cleaning, & Filtration
|
|
27,222
|
|
|
25,350
|
|
||
Fluid-Handling
|
|
32,886
|
|
|
22,047
|
|
||
Papermaking Systems
|
|
$
|
105,591
|
|
|
$
|
88,550
|
|
Wood Processing Systems
|
|
39,141
|
|
|
9,943
|
|
||
Fiber-based Products
|
|
4,461
|
|
|
4,364
|
|
||
|
|
$
|
149,193
|
|
|
$
|
102,857
|
|
Revenue by Product Type:
|
|
|
|
|
|
|
||
Parts and Consumables
|
|
$
|
95,985
|
|
|
$
|
70,444
|
|
Capital
|
|
53,208
|
|
|
32,413
|
|
||
|
|
$
|
149,193
|
|
|
$
|
102,857
|
|
Revenue by Geography:
|
|
|
|
|
|
|
||
North America
|
|
$
|
77,616
|
|
|
$
|
50,166
|
|
Europe
|
|
41,493
|
|
|
32,751
|
|
||
Asia
|
|
20,148
|
|
|
11,898
|
|
||
Rest of World
|
|
9,936
|
|
|
8,042
|
|
||
|
|
$
|
149,193
|
|
|
$
|
102,857
|
|
|
|
Three Months Ended
|
||
|
|
March 31,
|
||
(In thousands)
|
|
2018
|
||
Timing of Revenue Recognition:
|
|
|
|
|
Point in Time
|
|
$
|
142,005
|
|
Over Time
|
|
7,188
|
|
|
|
|
$
|
149,193
|
|
|
|
March 31,
2018 |
|
December 30,
2017 |
||||
(In thousands)
|
|
|
||||||
Balances from Contracts with Customers:
|
|
|
|
|
||||
Accounts receivable, net
|
|
$
|
91,529
|
|
|
$
|
89,624
|
|
Contract assets
|
|
2,375
|
|
|
2,374
|
|
||
Contract liabilities
|
|
(47,759
|
)
|
|
(38,702
|
)
|
|
|
Contract Assets
|
|
Contract Liabilities
|
||||
(In thousands)
|
|
|
||||||
Balance at December 30, 2017
|
|
$
|
2,374
|
|
|
$
|
(38,702
|
)
|
Impact from the adoption of Topic 606
|
|
2,021
|
|
|
(3,932
|
)
|
||
Reclassification to accounts receivable, net
|
|
(3,476
|
)
|
|
—
|
|
||
Contract assets recognized
|
|
1,403
|
|
|
—
|
|
||
Revenue recognized
|
|
—
|
|
|
27,325
|
|
||
Cash received and not recognized as revenue
|
|
—
|
|
|
(31,503
|
)
|
||
Currency translation
|
|
53
|
|
|
(947
|
)
|
||
Balance at March 31, 2018
|
|
$
|
2,375
|
|
|
$
|
(47,759
|
)
|
(In thousands)
|
|
Severance
|
|
Relocation
|
|
Other (a)
|
|
Total
|
||||||||
Balance at December 30, 2017
|
|
$
|
203
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
203
|
|
Provision (reversal)
|
|
(3
|
)
|
|
563
|
|
|
210
|
|
|
770
|
|
||||
Usage
|
|
—
|
|
|
(358
|
)
|
|
(120
|
)
|
|
(478
|
)
|
||||
Currency translation
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||
Balance at March 31, 2018
|
|
$
|
199
|
|
|
$
|
205
|
|
|
$
|
90
|
|
|
$
|
494
|
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
2018 |
|
April 1,
2017 |
||||
(In thousands, except per share amounts)
|
|
|
||||||
Amounts Attributable to Kadant:
|
|
|
|
|
||||
Net Income
|
|
$
|
10,858
|
|
|
$
|
8,951
|
|
|
|
|
|
|
||||
Basic Weighted Average Shares
|
|
11,042
|
|
|
10,952
|
|
||
Effect of Stock Options, Restricted Stock Units and Employee Stock Purchase Plan Shares
|
|
300
|
|
|
253
|
|
||
Diluted Weighted Average Shares
|
|
11,342
|
|
|
11,205
|
|
||
|
|
|
|
|
||||
Basic Earnings per Share
|
|
$
|
0.98
|
|
|
$
|
0.82
|
|
|
|
|
|
|
||||
Diluted Earnings per Share
|
|
$
|
0.96
|
|
|
$
|
0.80
|
|
|
|
March 31,
2018 |
|
December 30,
2017 |
||||
(In thousands)
|
|
|
||||||
Revolving Credit Facility, due 2022
|
|
$
|
235,851
|
|
|
$
|
237,011
|
|
Obligations Under Capital Lease, due 2018 to 2022
|
|
4,689
|
|
|
4,633
|
|
||
Other Borrowings, due 2018 to 2023
|
|
396
|
|
|
436
|
|
||
Total
|
|
240,936
|
|
|
242,080
|
|
||
Less: Current Maturities of Long-Term Obligations
|
|
(710
|
)
|
|
(696
|
)
|
||
Long-Term Obligations
|
|
$
|
240,226
|
|
|
$
|
241,384
|
|
|
(In thousands)
|
|
Foreign
Currency
Translation
Adjustment
|
|
Unrecognized
Prior Service
Cost on Pension and
Other Post-
Retirement Benefit Plans
|
|
Net Actuarial Loss
on Pension and
Other Post-
Retirement Benefit Plans
|
|
Deferred Gain
on Cash Flow Hedges
|
|
Total
|
||||||||||
Balance at December 30, 2017
|
|
$
|
(17,501
|
)
|
|
$
|
(319
|
)
|
|
$
|
(8,974
|
)
|
|
$
|
79
|
|
|
$
|
(26,715
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
5,293
|
|
|
(1
|
)
|
|
(39
|
)
|
|
89
|
|
|
5,342
|
|
|||||
Reclassifications from AOCI
|
|
—
|
|
|
18
|
|
|
139
|
|
|
4
|
|
|
161
|
|
|||||
Net current period other comprehensive income
|
|
5,293
|
|
|
17
|
|
|
100
|
|
|
93
|
|
|
5,503
|
|
|||||
Balance at March 31, 2018
|
|
$
|
(12,208
|
)
|
|
$
|
(302
|
)
|
|
$
|
(8,874
|
)
|
|
$
|
172
|
|
|
$
|
(21,212
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Included in the computation of net periodic benefit cost. See
Note 7
for additional information.
|
(b)
|
See
Note 9
for additional information.
|
|
|
|
|
March 31, 2018
|
|
December 30, 2017
|
||||||||||||
|
|
Balance Sheet Location
|
|
Asset (Liability) (a)
|
|
Notional Amount (b)
|
|
Asset (Liability) (a)
|
|
Notional Amount
|
||||||||
(In thousands)
|
|
|
|
|
|
|||||||||||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives in an Asset Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreement
|
|
Other Long-Term Assets
|
|
$
|
204
|
|
|
$
|
10,000
|
|
|
$
|
126
|
|
|
$
|
10,000
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward currency-exchange contract
|
|
Other Current Assets
|
|
$
|
24
|
|
|
$
|
1,002
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Derivatives in an Asset Position:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
Other Current Assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
1,244
|
|
Derivatives in a Liability Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward currency-exchange contracts
|
|
Other Current Liabilities
|
|
$
|
(1
|
)
|
|
$
|
2,366
|
|
|
$
|
(16
|
)
|
|
$
|
2,049
|
|
(a)
|
See
Note 10
for the fair value measurements relating to these financial instruments.
|
(b)
|
The total notional amount is indicative of the level of the Company's derivative activity during the first
three
months of
2018
.
|
(In thousands)
|
|
Interest Rate Swap
Agreement
|
|
Forward Currency-
Exchange
Contract
|
|
Total
|
||||||
Unrealized Gain, Net of Tax, at December 30, 2017
|
|
$
|
79
|
|
|
$
|
—
|
|
|
$
|
79
|
|
Loss reclassified to earnings (a)
|
|
4
|
|
|
—
|
|
|
4
|
|
|||
Gain recognized in AOCI
|
|
71
|
|
|
18
|
|
|
89
|
|
|||
Unrealized Gain, Net of Tax, at March 31, 2018
|
|
$
|
154
|
|
|
$
|
18
|
|
|
$
|
172
|
|
•
|
Level 1—Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2—Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
|
•
|
Level 3—Unobservable inputs based on the Company's own assumptions.
|
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
March 31, 2018
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds and time deposits
|
|
$
|
19,745
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19,745
|
|
Forward currency-exchange contract
|
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
24
|
|
Interest rate swap agreement
|
|
$
|
—
|
|
|
$
|
204
|
|
|
$
|
—
|
|
|
$
|
204
|
|
Banker's acceptance drafts (a)
|
|
$
|
—
|
|
|
$
|
12,021
|
|
|
$
|
—
|
|
|
$
|
12,021
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
December 30, 2017
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds and time deposits
|
|
$
|
17,728
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,728
|
|
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
17
|
|
Interest rate swap agreement
|
|
$
|
—
|
|
|
$
|
126
|
|
|
$
|
—
|
|
|
$
|
126
|
|
Banker's acceptance drafts (a)
|
|
$
|
—
|
|
|
$
|
15,960
|
|
|
$
|
—
|
|
|
$
|
15,960
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
16
|
|
(a)
|
Included in accounts receivable in the accompanying condensed consolidated balance sheet.
|
|
|
March 31, 2018
|
|
December 30, 2017
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
(In thousands)
|
|
|
|
|
||||||||||||
Long-term Debt Obligations:
|
|
|
|
|
|
|
|
|
||||||||
Revolving credit facility
|
|
$
|
235,851
|
|
|
$
|
235,851
|
|
|
$
|
237,011
|
|
|
$
|
237,011
|
|
Capital lease obligations
|
|
4,141
|
|
|
4,141
|
|
|
4,101
|
|
|
4,101
|
|
||||
Other borrowings
|
|
234
|
|
|
234
|
|
|
272
|
|
|
272
|
|
||||
|
|
$
|
240,226
|
|
|
$
|
240,226
|
|
|
$
|
241,384
|
|
|
$
|
241,384
|
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
|
|
April 1,
|
||||
(In thousands)
|
|
2018
|
|
2017
|
||||
Revenues:
|
|
|
|
|
||||
Papermaking Systems (a)
|
|
$
|
105,591
|
|
|
$
|
88,550
|
|
Wood Processing Systems (b)
|
|
39,141
|
|
|
9,943
|
|
||
Fiber-based Products
|
|
4,461
|
|
|
4,364
|
|
||
|
|
$
|
149,193
|
|
|
$
|
102,857
|
|
|
|
|
|
|
||||
Income Before Provision for Income Taxes:
|
|
|
|
|
|
|
||
Papermaking Systems (c)
|
|
$
|
14,584
|
|
|
$
|
14,299
|
|
Wood Processing Systems (d)
|
|
7,363
|
|
|
2,504
|
|
||
Corporate and Fiber-based Products (e)
|
|
(5,283
|
)
|
|
(4,553
|
)
|
||
Total operating income
|
|
16,664
|
|
|
12,250
|
|
||
Interest expense, net (f)
|
|
(1,549
|
)
|
|
(244
|
)
|
||
Other expense, net
|
|
(246
|
)
|
|
(204
|
)
|
||
|
|
$
|
14,869
|
|
|
$
|
11,802
|
|
|
|
|
|
|
||||
Capital Expenditures:
|
|
|
|
|
|
|
||
Papermaking Systems
|
|
$
|
4,649
|
|
|
$
|
1,484
|
|
Wood Processing Systems
|
|
376
|
|
|
186
|
|
||
Other
|
|
126
|
|
|
52
|
|
||
|
|
$
|
5,151
|
|
|
$
|
1,722
|
|
|
|
|
|
|
(a)
|
Includes $
5,900,000
in the
three
-month period ended
March 31, 2018
from 2017 acquisitions.
|
|
-
|
Stock-Preparation: custom-engineered systems and equipment, as well as standard individual components, for baling, pulping, de-inking, screening, cleaning, and refining primarily recycled fiber for preparation for entry into the paper machine, and recausticizing and evaporation equipment and systems used in the production of virgin pulp. Our baling equipment is also used to compress a variety of other secondary materials to prepare them for transport or storage;
|
|
-
|
Doctoring, Cleaning, & Filtration: doctoring, cleaning, and filtration systems and related consumables that keep paper machines and other industrial processes running efficiently; doctor blades made of a variety of materials to perform functions including cleaning, creping, web removal, flaking, and the application of coatings; and systems and equipment used to continuously clean fabrics and rolls, drain water from pulp mixtures, form the sheet or web, and filter the process water for reuse. Doctoring and cleaning systems are also used in other process industries such as carbon fiber, textiles and food processing; and
|
|
-
|
Fluid-Handling: rotary joints, precision unions, steam and condensate systems, components, and controls used to transfer fluids, power, and data in numerous process industries and expansion joints used in industrial piping systems.
|
|
-
|
Debarkers: ring and rotary debarkers and related parts and consumables that employ a combination of mechanical abrasion and log-to-log contact to efficiently remove bark from logs of all shapes and species;
|
|
-
|
Stranders: disc and ring stranders and related parts and consumables that cut batch-fed logs into strands for OSB production;
|
|
-
|
Chippers: disc, drum, and veneer chippers and related parts and consumables are high quality, robust chipper systems for waste-wood and whole-log applications found in pulp woodrooms, chip plants, sawmill, and planer mill sites; and
|
|
-
|
Logging machinery: feller bunchers, log loaders, and swing yarders that are used to harvest and gather timber for lumber production.
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
(Non-GAAP) Adjusted Total
|
||||||||||||||
(In thousands) |
|
March 31,
2018 |
|
April 1,
2017 |
|
Total Increase
|
|
Currency Translation
|
|
Acquisitions
|
|
|
Increase (Decrease)
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Stock-Preparation
|
|
$
|
45,483
|
|
|
$
|
41,153
|
|
|
$
|
4,330
|
|
|
$
|
3,456
|
|
|
$
|
—
|
|
|
$
|
874
|
|
Doctoring, Cleaning, & Filtration
|
|
27,222
|
|
|
25,350
|
|
|
1,872
|
|
|
1,201
|
|
|
—
|
|
|
671
|
|
||||||
Fluid-Handling
|
|
32,886
|
|
|
22,047
|
|
|
10,839
|
|
|
1,599
|
|
|
5,900
|
|
|
3,340
|
|
||||||
Papermaking Systems
|
|
105,591
|
|
|
88,550
|
|
|
17,041
|
|
|
6,256
|
|
|
5,900
|
|
|
4,885
|
|
||||||
Wood Processing Systems
|
|
39,141
|
|
|
9,943
|
|
|
29,198
|
|
|
467
|
|
|
28,870
|
|
|
(139
|
)
|
||||||
Fiber-based Products
|
|
4,461
|
|
|
4,364
|
|
|
97
|
|
|
—
|
|
|
—
|
|
|
97
|
|
||||||
|
|
$
|
149,193
|
|
|
$
|
102,857
|
|
|
$
|
46,336
|
|
|
$
|
6,723
|
|
|
$
|
34,770
|
|
|
$
|
4,843
|
|
|
|
Three Months Ended
|
||||
|
|
March 31,
2018 |
|
April 1,
2017 |
||
Papermaking Systems
|
|
45.6
|
%
|
|
47.9
|
%
|
Wood Processing Systems
|
|
39.5
|
%
|
|
42.2
|
%
|
Fiber-based Products
|
|
56.0
|
%
|
|
55.0
|
%
|
|
|
44.3
|
%
|
|
47.7
|
%
|
|
|
Three Months Ended
|
|
|
||||||||
(In thousands) |
|
March 31,
2018 |
|
April 1,
2017 |
|
Increase
|
||||||
Papermaking Systems
|
|
$
|
30,756
|
|
|
$
|
26,185
|
|
|
$
|
4,571
|
|
Wood Processing Systems
|
|
7,299
|
|
|
1,522
|
|
|
5,777
|
|
|||
Corporate and Other
|
|
7,721
|
|
|
6,913
|
|
|
808
|
|
|||
|
|
$
|
45,776
|
|
|
$
|
34,620
|
|
|
$
|
11,156
|
|
Exhibit Number
|
|
|
|
Description of Exhibit
|
|
|
|
|
10.1*
|
|
|
|
|
|
10.2*
|
|
|
|
|
|
10.3*
|
|
|
|
|
|
10.4*
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.**
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.**
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document.**
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document.**
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document.**
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document.**
|
|
|
|
|
*
|
Management contract or compensatory plan or arrangement.
|
||
**
|
Submitted electronically herewith.
|
|
KADANT INC.
|
|
|
Date: May 9, 2018
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
5.
|
No Stockholder Rights.
Except as set forth in the Plan, neither the Recipient nor any person claiming under or through the Recipient shall be, or have any rights or privileges of, a stockholder of the Company in respect of the Award Shares issuable pursuant to the RSUs until the Award Shares are issued in the name of the Recipient. In particular, a Recipient holding an unvested Award shall have no ownership interest in the shares of Common Stock to which the Award relates until the Award Shares have vested, payment with respect to such Award has actually been made in shares of Common Stock, and the underlying shares of Common Stock have been issued.
|
7.
|
No Compensation Deferral.
Neither the Plan nor this Award Agreement is intended to provide for any deferral of compensation that would be subject to Section 409A (“Section 409A”) of the U.S. Internal Revenue Code of 1986, as amended. The Company reserves the right, to the extent the Company deems necessary or advisable in its sole discretion, to unilaterally amend or modify the Plan and/or this Award Agreement to ensure that all awards (including, without limitation, the RSUs) are either exempt from or complaint with the requirements of Section 409A.
|
8.
|
Dilution and Other Adjustments
. In the event a stock dividend, stock split or combination of shares, or other distribution with respect to holders of common stock other than normal cash dividends, occurs while the Award is outstanding (after the Grant Date and before the date the Award is vested), the committee appointed by the Company’s Board of Directors to administer the Plan (the “Committee”) shall in the manner determined in its sole discretion adjust the number of shares for which the Award may be issued to reflect such event. In the event any recapitalization, merger or consolidation involving the Company, any transaction in which the Company becomes a subsidiary of another entity, any sale or other disposition of all or a substantial portion of the assets of the Company or any similar transaction, as determined by the Committee, (any of the foregoing, a “covered transaction”) occurs while the Award is outstanding, the Committee in its discretion may (i) accelerate the vesting of the Award, (ii) adjust the terms of the Award, (iii) if there is a survivor or acquiror entity, provide for the assumption of the Award by such survivor or acquiror or an affiliate thereof or for the grant of one or more replacement awards by such survivor or acquiror or an affiliate thereof, in each case on such terms as the Committee may determine, (iv) terminate the Award (provided, that if the Committee terminates the Award, it shall, in connection therewith, either (A) accelerate the vesting of the Award prior to such termination, or (B) provide for a payment to the holder of the Award of cash or other property or a combination of cash or other property in an amount reasonably determined by the Committee to approximate the value of the Award assuming it vested immediately prior to the transaction, or (C) if there is a survivor or acquiror entity, provide for the grant of one or more replacement awards pursuant to clause (iii) above), or (v) provide for none of, or any combination of, the foregoing. No fraction of a share or fractional shares shall be purchasable or deliverable under this Award Agreement.
|
9.
|
Administration.
The Compensation Committee of the Company’s Board of Directors or other committee designated in the Plan, shall have the authority to manage and control the operation and administration of this Award Agreement. Any interpretation of the Award Agreement by any of the entities specified in the preceding sentence and any decision made by any of them with respect to the Award Agreement is final and binding.
|
(a)
|
The Plan and this Award were established voluntarily by the Company, each is discretionary in nature, and each may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Award Agreement;
|
(b)
|
The grant of RSUs is voluntary and occasional and does not create any contractual or other right to receive future awards of RSUs, or benefits in lieu of RSUs even if RSUs have been awarded repeatedly in the past or future;
|
(c)
|
All decisions with respect to future grants of RSUs, if any, will be at the sole discretion of the Company;
|
(e)
|
RSUs are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or to the Recipient’s employer, and RSUs are outside the scope of the Recipient’s employment contract, if any;
|
(f)
|
RSUs are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculation of any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or the Recipient’s employer;
|
(g)
|
The future value of the underlying Award Shares is unknown and cannot be predicted with certainty;
|
(h)
|
The value of the Award Shares underlying the RSUs may increase or decrease in value during the period from the Grant Date to the Vesting Date;
|
(i)
|
In consideration of the grant of RSUs, no claim or entitlement to compensation or damages arises from termination of the RSUs or diminution in value of the RSUs or Award Shares received upon vesting of RSUs resulting from termination of the Recipient’s employment by the Company or the Recipient’s employer (for any reason whatsoever and whether or not in breach of local labor laws) and the Recipient irrevocably releases the Company and his or her employer from any such claim that may arise; and if, notwithstanding the foregoing, any such claim is found by a
|
(j)
|
Further, if the Recipient ceases to be an employee (whether or not in breach of local labor laws), the Recipient’s right to receive RSUs and vest under the Award Agreement or Plan, if any, will terminate effective as of the date that the Recipient is no longer actively employed by the Company and will not be extended by any notice period mandated under local law (e.g., active employment would not include a period of “garden leave” or similar period pursuant to local law); and the Compensation Committee of the Company’s Board of Directors shall have the exclusive discretion to determine when the Recipient is no longer actively employed for purposes of this Award Agreement and the Plan.
|
•
|
the Recipient’s name
|
•
|
contact details (home address, telephone number, personal and/or work email address)
|
•
|
date of birth
|
•
|
social security number
|
•
|
tax or identification number
|
•
|
salary, bonus and other compensation
|
•
|
national, federal, state, provincial and any other tax information
|
•
|
nationality and tax residency
|
•
|
information with regard to job status termination and disability benefits
|
•
|
job title
|
•
|
information with regard to any shares or directorships held
|
•
|
details of options or awards or any other interests in shares awarded, cancelled, exercised, vested, unvested or outstanding in your name
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1)
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other members of the Kadant group of companies, including Kadant Inc. in the United States or;
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2)
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any third party we engage for the purpose of selling the shares the Recipient receives or to which the Recipient is entitled under the Plan or;
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3)
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any third party engaged by the Company including any third party broker, stock plan service provider or administrator and the Company’s transfer agent; or
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4)
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other third parties or tax authorities assisting us with the processing of the Data or required in connection with legal and tax compliance or reporting.
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•
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Results from the date of sale related to any operation that was sold during the Measurement Period
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•
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Depreciation and amortization expense
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•
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Restructuring costs or other expense (income) which is presented on a separate line item in the Company’s income statement as included in its earnings release and SEC filings
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•
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Non-cash compensation expense from equity compensation
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•
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Results from any operations acquired during the Measurement Period
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Granted to:
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###PARTICIPANT_NAME###
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Grant Date:
|
###GRANT_DATE###
|
Granted:
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###TOTAL_AWARDS###
|
Grant Price:
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###GRANT_PRICE###
|
Expiration Date:
|
###EXPIRY_DATE###
|
Vesting Schedule:
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###VEST_SCHEDULE_TABLE###
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1.
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Preamble.
On the effective date shown on the first page of this Award Agreement (“Grant Date”), the Company granted to the Recipient named on the first page (the “Recipient”) restricted stock units (“RSUs”) with respect to the number of shares of common stock of the Company identified on the first page of this Award Agreement (“Award Shares”), subject to the terms, conditions and restrictions set forth in this Award Agreement and the provisions of the Company’s Amended and Restated Equity Incentive Plan, as amended from time to time (“Plan”). The RSUs represent a promise by the Company to deliver the Award Shares upon vesting. Any consideration due to the Company on the issuance of Award Shares pursuant to this Award Agreement will be deemed to have been satisfied by services rendered by the Recipient to the Company during the vesting period.
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2.
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Restrictions on Transfer
. Unless and until the Award Shares shall have vested as provided in Section 3 below, the Recipient shall not sell, transfer, pledge, hypothecate, assign or otherwise dispose of, by operation of law or otherwise, any RSUs, or any interest therein.
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3.
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Vesting Date
. Subject to the terms, conditions and restrictions of this Award Agreement, including the Forfeiture provisions described in Section 4 below, the Recipient shall vest in the Award Shares on the dates and in the quantities set forth in the Vesting Schedule on the first page of this Notice of Award and Award Agreement (each such date being referred to as a “Vesting Date”). As soon as administratively practicable after the Vesting Date, but in any event within the period ending on the later to occur of the date that is 2 ½ months from the end of the (i) Recipient’s tax year that includes the Vesting Date, or (ii) the Company’s fiscal year that includes the Vesting Date, the Company shall cause its transfer agent to issue and deliver the Award Shares in the name of the Recipient, subject to payment of all applicable withholding taxes pursuant to Section 6 below.
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(a)
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The Plan and this Award were established voluntarily by the Company, each is discretionary in nature, and each may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Award Agreement;
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(b)
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The grant of RSUs is voluntary and occasional and does not create any contractual or other right to receive future awards of RSUs, or benefits in lieu of RSUs even if RSUs have been awarded repeatedly in the past or future;
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(g)
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The future value of the underlying Award Shares is unknown and cannot be predicted with certainty;
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(h)
|
The value of the Award Shares underlying the RSUs may increase or decrease in value during the period from the Grant Date to the Vesting Date;
|
•
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the Recipient’s name
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•
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contact details (home address, telephone number, personal and/or work email address)
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•
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date of birth
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•
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social security number
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•
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tax or identification number
|
•
|
salary, bonus and other compensation
|
•
|
national, federal, state, provincial and any other tax information
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•
|
nationality and tax residency
|
•
|
information with regard to job status termination and disability benefits
|
•
|
job title
|
•
|
information with regard to any shares or directorships held
|
•
|
details of options or awards or any other interests in shares awarded, cancelled, exercised, vested, unvested or outstanding in your name
|
1)
|
other members of the Kadant group of companies, including Kadant Inc. in the United States or;
|
2)
|
any third party we engage for the purpose of selling the shares the Recipient receives or to which the Recipient is entitled under the Plan or;
|
3)
|
any third party engaged by the Company including any third party broker, stock plan service provider or administrator and the Company’s transfer agent; or
|
4)
|
other third parties or tax authorities assisting us with the processing of the Data or required in connection with legal and tax compliance or reporting.
|
•
|
An annual retainer of $50,000.
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•
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An additional annual retainer for our non-executive chairman of the board of $60,000.
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•
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An additional annual retainer for chairmen of the following committees:
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•
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audit committee - $10,000;
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•
|
compensation committee - $7,500;
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•
|
nominating and corporate governance committee - $5,000; and
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•
|
risk oversight committee - $5,000.
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•
|
Reimbursement of out-of pocket expenses incurred in attending or participating in meetings of our board of directors or its committees.
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5.
|
No Stockholder Rights.
Except as set forth in the Plan, neither the Recipient nor any person claiming under or through the Recipient shall be, or have any rights or privileges of, a stockholder of the Company in respect of the Award Shares issuable pursuant to the RSUs until the Award Shares are issued in the name of the Recipient. In particular, a Recipient holding an unvested Award shall have no ownership interest in the shares of Common Stock to which the Award relates until the Award Shares have vested, payment with respect to such Award has actually been made in shares of Common Stock, and the underlying shares of Common Stock have been issued.
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6.
|
Withholding Taxes.
The Company’s obligation to deliver Award Shares to the Recipient upon the vesting of the RSUs shall be subject to the satisfaction of all income tax (including federal, state, local and foreign taxes), social insurance, payroll tax, payment on account or other tax-related withholding requirements of any applicable jurisdiction, based on minimum statutory withholding rates for all tax purposes, including payroll and social security taxes (“Withholding Taxes”). In order to satisfy all Withholding Taxes due in connection with the award or vesting of the RSUs or the delivery of the Award Shares, the Recipient hereby irrevocably agrees to the following actions by the Company, at the Company’s sole election:
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7.
|
No Compensation Deferral.
Neither the Plan nor this Award Agreement is intended to provide for any deferral of compensation that would be subject to Section 409A (“Section 409A”) of the U.S. Internal Revenue Code of 1986, as amended. The Company reserves the right, to the extent the Company deems necessary or advisable in its sole discretion, to unilaterally amend or modify the Plan and/or this Award Agreement to ensure that all awards (including, without limitation, the RSUs) are either exempt from or compliant with the requirements of Section 409A.
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8.
|
Dilution and Other Adjustments
. In the event a stock dividend, stock split or combination of shares, or other distribution with respect to holders of common stock other than normal cash dividends, occurs while the Award is outstanding (after the Grant Date and before the date the Award is vested), the committee appointed by the Company’s Board of Directors to administer the Plan (the “Committee”) shall in the manner determined in its sole discretion adjust the number of shares for which the Award may be issued to reflect such event. In the event any recapitalization, merger or consolidation involving the Company, any transaction in which the Company becomes a subsidiary of another entity, any sale or other disposition of all or a substantial portion of the assets of the Company or any similar transaction, as determined by the Committee, (any of the foregoing, a “covered transaction”) occurs while the Award is outstanding, the Committee in its discretion may (i) accelerate the vesting of the Award, (ii) adjust the terms of the Award, (iii) if there is a survivor or acquiror entity, provide for the assumption of the Award by such survivor or acquiror or an affiliate thereof or for the grant of one or more replacement awards by such survivor or acquiror or an affiliate thereof, in each case on such terms as the Committee may determine, (iv) terminate the Award (provided, that if the Committee
|
9.
|
Administration.
The Compensation Committee of the Company’s Board of Directors or other committee designated in the Plan, shall have the authority to manage and control the operation and administration of this Award Agreement. Any interpretation of the Award Agreement by any of the entities specified in the preceding sentence and any decision made by any of them with respect to the Award Agreement is final and binding.
|
•
|
the Recipient’s name
|
•
|
contact details (home address, telephone number, personal and/or work email address)
|
•
|
date of birth
|
•
|
social security number
|
•
|
tax or identification number
|
•
|
salary, bonus and other compensation
|
•
|
national, federal, state, provincial and any other tax information
|
•
|
nationality and tax residency
|
•
|
information with regard to job status termination and disability benefits
|
•
|
job title
|
•
|
information with regard to any shares or directorships held
|
•
|
details of options or awards or any other interests in shares awarded, cancelled, exercised, vested, unvested or outstanding in your name
|
1)
|
other members of the Kadant group of companies, including Kadant Inc. in the United States or;
|
2)
|
any third party we engage for the purpose of selling the shares the Recipient receives or to which the Recipient is entitled under the Plan or;
|
3)
|
any third party engaged by the Company including any third party broker, stock plan service provider or administrator and the Company’s transfer agent; or
|
4)
|
other third parties or tax authorities assisting us with the processing of the Data or required in connection with legal and tax compliance or reporting;
|
(e)
|
Binding Effect
. This Award Agreement shall be binding upon and inure to the benefit of the Company and the Recipient and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in this Award Agreement.
|
(f)
|
Language
. The English version of this Award Agreement, the Plan and any other document delivered pursuant to either the Award Agreement or the Plan, will control over any translated version of any such document in the event such translated version is different from the English version.
|
(i)
|
Amendment
.
This Award Agreement may be amended only by written agreement between the Recipient and the Company, without the consent of any other person.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the period ended
March 31, 2018
of Kadant Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of 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: May 9, 2018
|
/s/ Jonathan W. Painter
|
|
Jonathan W. Painter
|
|
Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the period ended
March 31, 2018
of Kadant Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of 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: May 9, 2018
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Chief Financial Officer
|
|
|
Dated: May 9, 2018
|
/s/ Jonathan W. Painter
|
|
Jonathan W. Painter
|
|
Chief Executive Officer
|
|
|
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Chief Financial Officer
|