þ | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT |
Delaware | 03-0450326 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
2
June 30, | December 31, | |||||||
2007 | 2006 | |||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 328,000 | $ | 79,000 | ||||
Accounts receivable, net of allowances of $70,000 and $77,000, respectively
|
6,699,000 | 5,354,000 | ||||||
Prepaid expenses
|
147,000 | 265,000 | ||||||
Other current assets
|
303,000 | 181,000 | ||||||
Deferred tax asset, current
|
1,069,000 | 1,069,000 | ||||||
|
||||||||
Total current assets
|
8,546,000 | 6,948,000 | ||||||
|
||||||||
Property and equipment, net of $1,601,000 and $1,410,000 in accumulated depreciation, respectively
|
2,408,000 | 2,488,000 | ||||||
|
||||||||
Goodwill
|
5,527,000 | 5,527,000 | ||||||
Identified intangible assets, net of $1,164,000 and $1,004,000 in accumulated amortization, respectively
|
4,065,000 | 4,225,000 | ||||||
Loans and advances
|
125,000 | 143,000 | ||||||
Deferred tax asset, long term
|
1,334,000 | 2,069,000 | ||||||
Other long term assets
|
381,000 | 209,000 | ||||||
|
||||||||
|
$ | 22,386,000 | $ | 21,609,000 | ||||
|
||||||||
|
||||||||
Liabilities and Stockholders Equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 1,109,000 | $ | 1,034,000 | ||||
Accrued salaries and wages
|
576,000 | 724,000 | ||||||
Accrued acquisition earnouts
|
0 | 1,960,000 | ||||||
Accrued expenses, other
|
1,490,000 | 740,000 | ||||||
Current maturities of long term debt
|
117,000 | 117,000 | ||||||
Other current liabilities
|
530,000 | 295,000 | ||||||
|
||||||||
Total current liabilities
|
3,822,000 | 4,870,000 | ||||||
|
||||||||
|
||||||||
Line of credit
|
1,346,000 | 1,159,000 | ||||||
Notes payable and capital leases, net of current maturities
|
58,000 | 127,000 | ||||||
Other long-term liabilities
|
108,000 | 115,000 | ||||||
|
||||||||
Total long-term liabilities
|
1,512,000 | 1,401,000 | ||||||
|
||||||||
|
||||||||
Stockholders equity:
|
||||||||
Preferred stock, $.001 par value; 10,000,000 shares no shares issued or outstanding
|
| | ||||||
Common stock, $.001 par value; 100,000,000 shares authorized; 26,915,880 and
26,516,037 shares issued and 26,735,880 and 26,336,037 shares outstanding
|
27,000 | 27,000 | ||||||
Additional paid-in capital
|
20,958,000 | 20,459,000 | ||||||
Accumulated deficit
|
(3,826,000 | ) | (5,041,000 | ) | ||||
Treasury stock, at cost, 180,000 shares held
|
(107,000 | ) | (107,000 | ) | ||||
|
||||||||
Total stockholders equity
|
17,052,000 | 15,338,000 | ||||||
|
||||||||
|
$ | 22,386,000 | $ | 21,609,000 | ||||
|
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
June 30,
June 30,
2007
2006
2007
2006
$
13,842,000
$
11,120,000
$
25,335,000
$
20,675,000
10,328,000
8,257,000
18,801,000
15,386,000
3,514,000
2,863,000
6,534,000
5,289,000
2,242,000
1,923,000
4,492,000
3,644,000
27,000
29,000
34,000
132,000
34,000
63,000
58,000
108,000
1,211,000
848,000
1,950,000
1,405,000
457,000
735,000
$
754,000
$
848,000
$
1,215,000
$
1,405,000
0.03
0.03
0.05
0.05
0.03
0.03
0.04
0.05
26,706,100
26,285,034
26,574,016
26,285,034
27,509,728
26,441,809
27,365,538
26,398,952
Table of Contents
Six Months Ended June 30,
2007
2006
$
1,215,000
$
1,405,000
(7,000
)
(228,000
)
451,000
513,000
85,000
59,000
123,000
90,000
27,000
21,000
(1,337,000
)
(949,000
)
(120,000
)
35,000
118,000
132,000
556,000
(76,000
)
76,000
279,000
750,000
(6,000
)
(147,000
)
(249,000
)
223,000
154,000
798,000
(225,000
)
2,013,000
1,180,000
(1,960,000
)
(1,460,000
)
(254,000
)
(472,000
)
23,000
6,000
18,000
150,000
(2,173,000
)
(1,776,000
)
187,000
394,000
(69,000
)
(102,000
)
291,000
409,000
292,000
249,000
(304,000
)
79,000
386,000
$
328,000
$
82,000
$
59,000
$
101,000
$
49,000
$
$
$
647,000
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Additional
Accumulated
Common Stock
Treasury Stock
Paid In
Earnings
Shares
Amount
Shares
Amount
Capital
(Deficit)
Total
Balance, December 31, 2006
26,516,037
$
27,000
(180,000
)
$
(107,000
)
$
20,459,000
$
(5,041,000
)
$
15,338,000
290,500
291,000
291,000
19,343
90,000
123,000
123,000
85,000
85,000
1,215,000
1,215,000
26,915,880
$
27,000
(180,000
)
$
(107,000
)
$
20,958,000
$
(3,826,000
)
$
17,052,000
Table of Contents
Table of Contents
Three Months Ended
Six Months Ended
June 30,
June 30,
2007
2006
2007
2006
5.00
%
4.35
%
5.00
%
4.35
%
6.0 years
5.0 years
6.0 years
5.0 years
35
%
31
%
35
%
26
%
none
none
none
none
$
0.59
$
0.37
$
0.62
$
0.19
Weighted
Weighted
Average
Average
Remaining
Shares
Exercise Price
Contractual Life
13,153,738
$
1.49
2.5 Years
10,173
1.25
(20,000
)
1.35
(290,500
)
1.00
410,475
1.45
(1,070,000
)
1.75
12,193,886
$
1.48
2.4 Years
11,072,822
$
1.50
2.0 Years
Table of Contents
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
2007
2006
2007
2006
$
754,000
$
848,000
$
1,215,000
$
1,405,000
26,706,100
26,285,034
26,574,016
26,285,034
$
0.03
$
0.03
$
0.05
$
0.05
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
2007
2006
2007
2006
$
754,000
$
848,000
$
1,215,000
$
1,405,000
26,706,100
26,285,034
26,574,016
26,285,034
803,628
156,775
791,522
113,918
27,509,728
26,441,809
27,365,538
26,398,952
$
0.03
$
0.03
$
0.04
$
0.05
Table of Contents
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Table of Contents
Corporate and
Express-1
Evansville
Other
Consolidated
$
12,575,000
$
1,267,000
$
0
$
13,842,000
1,556,000
102,000
(447,000
)
1,211,000
188,000
32,000
220,000
34,000
34,000
457,000
457,000
5,527,000
5,527,000
18,490,000
820,000
3,076,000
22,386,000
$
9,868,000
$
1,252,000
$
0
$
11,120,000
1,094,000
100,000
(346,000
)
848,000
207,000
47,000
0
254,000
0
0
63,000
63,000
0
0
0
0
3,567,000
0
0
3,567,000
15,630,000
845,000
2,444,000
18,919,000
$
22,850,000
$
2,485,000
$
0
$
25,335,000
2,540,000
237,000
(827,000
)
1,950,000
376,000
75,000
451,000
58,000
58,000
735,000
735,000
5,527,000
5,527,000
18,490,000
820,000
3,076,000
22,386,000
$
18,244,000
$
2,431,000
$
0
$
20,675,000
1,969,000
128,000
(692,000
)
1,405,000
419,000
94,000
0
513,000
0
0
108,000
108,000
0
0
0
0
3,567,000
0
0
3,567,000
15,630,000
845,000
2,444,000
18,919,000
Table of Contents
Table of Contents
Table of Contents
Percentage of Revenue
Three Months Ended June 30,
Three Months Ended June 30,
Revenues
2007
2006
Change
% Change
2007
2006
$
10,861,000
$
7,696,000
$
3,165,000
41.1
%
78.4
%
69.2
%
1,714,000
2,172,000
(458,000
)
-21.1
%
12.4
%
19.5
%
12,575,000
9,868,000
2,707,000
27.4
%
90.8
%
88.7
%
1,267,000
1,252,000
15,000
1.2
%
9.2
%
11.3
%
$
13,842,000
$
11,120,000
$
2,722,000
24.5
%
100.0
%
100.0
%
$
7,894,000
$
5,469,000
$
2,425,000
44.3
%
72.7
%
71.1
%
1,396,000
1,799,000
(403,000
)
-22.4
%
81.4
%
82.8
%
9,290,000
7,268,000
2,022,000
27.8
%
73.9
%
73.7
%
1,038,000
989,000
49,000
5.0
%
81.9
%
79.0
%
$
10,328,000
$
8,257,000
$
2,071,000
25.1
%
74.6
%
74.3
%
$
2,967,000
$
2,227,000
$
740,000
33.2
%
27.3
%
28.9
%
318,000
373,000
(55,000
)
-14.7
%
18.6
%
17.2
%
3,285,000
2,600,000
685,000
26.3
%
26.1
%
26.3
%
229,000
263,000
(34,000
)
-12.9
%
18.1
%
21.0
%
$
3,514,000
$
2,863,000
$
651,000
22.7
%
25.4
%
25.7
%
$
1,729,000
$
1,506,000
$
223,000
14.8
%
13.7
%
15.3
%
127,000
163,000
(36,000
)
-22.1
%
10.0
%
13.0
%
447,000
346,000
101,000
29.2
%
3.2
%
3.1
%
$
2,303,000
$
2,015,000
$
288,000
14.3
%
16.6
%
18.1
%
$
1,556,000
$
1,094,000
$
462,000
42.2
%
12.4
%
11.1
%
102,000
100,000
2,000
2.0
%
8.1
%
8.0
%
(447,000
)
(346,000
)
(101,000
)
29.2
%
-3.2
%
-3.1
%
1,211,000
848,000
363,000
42.8
%
8.7
%
7.6
%
457,000
(457,000
)
100.0
%
3.3
%
$
754,000
$
848,000
$
(94,000
)
-11.1
%
5.4
%
7.6
%
*
Percentages reflected in the table above in columns labeled Percentage of Revenue, Three Months
Ended June 30 were calculated based upon associated revenues for each grouping reflected, rather
than consolidated revenues.
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Percentage of Revenue
Six Months Ended June 30,
Six Months Ended
June 30,
Revenues
2007
2006
Change
% Change
2007
2006
$
19,499,000
$
13,933,000
$
5,566,000
39.9
%
77.0
%
67.4
%
3,351,000
4,311,000
(960,000
)
-22.3
%
13.2
%
20.8
%
22,850,000
18,244,000
4,606,000
25.2
%
90.2
%
88.2
%
2,485,000
2,431,000
54,000
2.2
%
9.8
%
11.8
%
$
25,335,000
$
20,675,000
$
4,660,000
22.5
%
100.0
%
100.0
%
$
14,159,000
$
9,978,000
$
4,181,000
41.9
%
72.6
%
71.6
%
2,681,000
3,428,000
(747,000
)
-21.8
%
80.0
%
79.5
%
16,840,000
13,406,000
3,434,000
25.6
%
73.7
%
73.5
%
1,961,000
1,980,000
(19,000
)
-1.0
%
78.9
%
81.4
%
$
18,801,000
$
15,386,000
$
3,415,000
22.2
%
74.2
%
74.4
%
$
5,340,000
$
3,955,000
$
1,385,000
35.0
%
27.4
%
28.4
%
670,000
883,000
(213,000
)
-24.1
%
20.0
%
20.5
%
6,010,000
4,838,000
1,172,000
24.2
%
26.3
%
26.5
%
524,000
451,000
73,000
16.2
%
21.1
%
18.6
%
$
6,534,000
$
5,289,000
$
1,245,000
23.5
%
25.8
%
25.6
%
$
3,470,000
$
2,869,000
$
601,000
20.9
%
15.2
%
15.7
%
287,000
323,000
(36,000
)
-11.1
%
11.5
%
13.3
%
827,000
692,000
135,000
19.5
%
3.3
%
3.3
%
$
4,584,000
$
3,884,000
$
700,000
18.0
%
18.1
%
18.8
%
$
2,540,000
$
1,969,000
$
571,000
29.0
%
11.1
%
10.8
%
237,000
128,000
109,000
85.2
%
9.5
%
5.3
%
(827,000
)
(692,000
)
(135,000
)
19.5
%
-3.3
%
-3.3
%
1,950,000
1,405,000
545,000
38.8
%
7.7
%
6.8
%
735,000
(735,000
)
100.0
%
2.9
%
$
1,215,000
$
1,405,000
$
(190,000
)
-13.5
%
4.8
%
6.8
%
*
Percentages reflected in the table above in columns labeled Percentage of Revenue, Six Months
Ended June 30 were calculated based upon associated revenues for each grouping reflected, rather
than consolidated revenues.
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Approximate
Number of
Approximate
Shares
Proceeds
2,991,475
$
3,663,146
1,712,857
2,997,500
7,489,554
11,394,532
12,193,886
$
18,055,178
(1)
Consists of options granted to sellers of Dasher Express, Inc. and
Express-1, Inc. in conjunction with the purchase agreements for these
two acquisitions.
Payments due by period
Less than 1
1-3
3-5
More than 5
Contractual Obligations
Total
year
years
years
years
168,000
110,000
58,000
64,000
46,000
18,000
2,210,000
2,210,000
7,000
7,000
$
2,449,000
$
2,373,000
$
76,000
Table of Contents
(*)
Represents the maximum amount we could be required to pay, based upon the attainment
of specific performance targets of our Express-1, Inc. business segment.
Table of Contents
Table of Contents
26
27
(1)
To elect a board of seven directors;
Table of Contents
(2)
To ratify the appointment of Pender Newkirk & Company as independent auditors
for the Company for the year ending December 31, 2007;
(3)
To approve and ratify an amendment to our Certificate of Incorporation
and Bylaws creating three classes of Director (Class I, Class II and Class III)
with staggered three-year terms of appointment.
For
Against
Abstentions
24,684,654
0
74,529
24,682,917
0
76,266
24,686,604
0
72,579
24,651,738
0
107,445
24,685,724
0
73,459
24,686,617
0
72,566
24,686,175
0
73,008
24,428,346
316,545
14,290
14,125,554
771,117
14,882
31.1
Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2
Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
Certification of the Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002. (This exhibit shall not be deemed filed for the purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further,
this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
32.2
Certification of the Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002. (This exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit
shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933,
as amended, or the Securities Exchange Act of 1934, as amended.)
Add: corporate charter for staggered terms, etc.
Table of Contents
28
29
Express-1 Expedited Solutions, Inc.
/s/
Michael R. Welch
Michael R. Welch
Chief Executive Officer
/s/
Mark K. Patterson
Mark K. Patterson
Chief Financial Officer
Table of Contents
Exhibit No.
Description
Certificate of Amendment to Certificate of Incorporation Amended and Restated
Corporate Bylaws as of June 20, 2007
Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certification of the Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002. (This exhibit shall not be deemed filed for the purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further,
this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
Certification of the Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002. (This exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit
shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933,
as amended, or the Securities Exchange Act of 1934, as amended.)
EXPRESS-1 EXPEDITED SOLUTIONS, INC.
|
||||
By: | /s/ Mark Patterson | |||
Mark Patterson, Chief Financial | ||||
Officer | ||||
ARTICLE I OFFICES
|
||||
|
||||
Section 1. Registered Office
|
1 | |||
Section 2. Other Offices
|
1 | |||
|
||||
ARTICLE II STOCKHOLDERS
|
||||
|
||||
Section 1. Place of Meetings
|
1 | |||
Section 2. Annual Meeting
|
1 | |||
Section 3. List of Stockholders
|
1 | |||
Section 4. Special Meetings
|
1 | |||
Section 5. Notice
|
1 | |||
Section 6. Quorum
|
2 | |||
Section 7. Voting
|
2 | |||
Section 9. Method of Voting
|
2 | |||
Section 9. Record Date
|
2 | |||
Section 10. Action by Consent
|
2 | |||
Section 11. Stockholder Proposals
|
3 | |||
Section 12. Nomination of Directors
|
3 | |||
|
||||
ARTICLE III BOARD OF DIRECTORS
|
||||
|
||||
Section 1. Management
|
4 | |||
Section 2. Qualification: Election: Term
|
4 | |||
Section 3. Number
|
4 | |||
Section 4. Removal
|
5 | |||
Section 5. Vacancies
|
5 | |||
Section 6. Place of Meetings
|
5 | |||
Section 7. Annual Meeting
|
5 | |||
Section 8. Regular Meetings
|
5 | |||
Section 9. Special Meetings
|
5 | |||
Section 10. Quorum
|
5 | |||
Section 11. Interested Directors
|
5 | |||
Section 12. Committees
|
6 | |||
Section 13. Action by Consent
|
6 | |||
Section 14. Compensation of Directors
|
6 | |||
|
||||
ARTICLE IV NOTICE
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Section 1. Form of Notice
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6 | |||
Section 2. Waiver
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6 |
i
ARTICLE V OFFICERS AND AGENTS
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Section 1. In General
|
7 | |||
Section 2. Election
|
7 | |||
Section 3. Other Officers and Agents
|
7 | |||
Section 4. Compensation
|
7 | |||
Section 5. Term of Office and Removal
|
7 | |||
Section 6. Employment and Other Contracts
|
7 | |||
Section 7. Chairman of the Board of Directors
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7 | |||
Section 8. Chief Executive Officer
|
7 | |||
Section 9. President
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8 | |||
Section 10. Chief Financial Officer
|
8 | |||
Section 11. Secretary
|
8 | |||
Section 12. Bonding
|
8 | |||
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ARTICLE VI CERTIFICATES REPRESENTING SHARES
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Section 1. Form of Certificates
|
8 | |||
Section 2. Lost Certificates
|
8 | |||
Section 3. Transfer of Shares
|
9 | |||
Section 4. Registered Stockholders
|
9 | |||
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ARTICLE VII GENERAL PROVISIONS
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Section 1. Dividends
|
9 | |||
Section 2. Reserves
|
9 | |||
Section 3. Telephone and Similar Meeting
|
9 | |||
Section 4. Books and Records
|
10 | |||
Section 5. Fiscal Year
|
10 | |||
Section 6. Seal
|
10 | |||
Section 7. Advances of Expenses
|
10 | |||
Section 8. Indemnification
|
10 | |||
Section 9. Insurance
|
11 | |||
Section 10. Resignation
|
11 | |||
Section 11 Amendment of Bylaws
|
11 | |||
Section 12. Invalid Provisions
|
11 | |||
Section 13. Relation to the Certificate
|
11 |
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By: | /s/ Mark Patterson | |||
Mark Patterson | ||||
Chief Financial Officer | ||||
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/s/ Michael R. Welch | |||
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Chief Executive Officer |
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/s/ Mark K. Patterson | |||
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Chief Financial Officer |
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By: | /s/ Michael R. Welch | ||||
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Chief Executive Officer |
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By: | /s/ Mark K. Patterson | ||||
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Chief Financial Officer |
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