ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended March 31, 2014
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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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Wisconsin
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39-1847269
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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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2210 Woodland Drive, Manitowoc, WI
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54220
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common stock, no par value
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NYSE MKT LLC
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Common stock purchase rights
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NYSE MKT LLC
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Large accelerated filer
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¨
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Accelerated filer
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o
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Non-accelerated filer
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o
(Do not check if a smaller reporting company)
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Smaller reporting company
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ý
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•
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our development of, and participation in, new product and technology offerings or applications, including customer acceptance of our new LED product line;
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•
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deterioration of market conditions, including our dependence on customers' capital budgets for sales of products and services;
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•
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our ability to compete and execute our strategy in a highly competitive market and our ability to respond successfully to market competition;
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•
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our ability to effectively manage the acquisition of Harris Manufacturing, Inc. and Harris LED, LLC and our ability to successfully complete and fund potential future acquisitions.
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•
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adverse developments with respect to litigation and other legal matters that we are subject to;
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•
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increasing duration of customer sales cycles;
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•
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the market acceptance of our products and services;
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•
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our ability to recruit and hire sales talent to increase our in-market sales;
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•
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price fluctuations, shortages or interruptions of component supplies and raw materials used to manufacture our products;
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•
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loss of one or more key customers or suppliers, including key contacts at such customers;
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•
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our ability to effectively manage our product inventory to provide our products to customers on a timely basis;
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•
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our ability to effectively manage the credit risk associated with our debt funded Orion Throughput Agreement contracts;
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•
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a reduction in the price of electricity;
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•
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the cost to comply with, and the effects of, any current and future government regulations, laws and policies;
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•
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increased competition from government subsidies and utility incentive programs;
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•
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the availability of additional debt financing and/or equity capital; and
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•
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potential warranty claims.
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Page
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ITEM 1.
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BUSINESS
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•
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comprehensive site assessment, which includes a review of the current lighting requirements and energy usage at the customer’s facility;
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•
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site field verification, or SFV, during which we perform a test implementation of our energy management system at a customer’s facility;
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•
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utility incentive and government subsidy management, where we assist our customers in identifying, applying for and obtaining available utility incentives or government subsidies;
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•
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engineering design, which involves designing a customized system to suit our customers' facility lighting and energy management needs, and providing the customer with a written analysis of the potential energy savings and lighting and environmental benefits associated with the designed system;
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•
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project management, which involves our working with the electrical contractor in overseeing and managing all phases of implementation from delivery through installation for a single facility or through multi-facility roll-outs tied to a defined project schedule;
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•
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installation services, for our products, which we provide through our national network of qualified third-party installers; and
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•
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recycling in connection with our retrofit installations, where we remove, dispose of and recycle our customer’s legacy lighting fixtures.
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ITEM 1A.
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RISK FACTORS
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•
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Failure to realize the potential of the acquired businesses' technologies, complete product development, or properly obtain or secure appropriate protection of intellectual property rights; and
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•
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The price, volatility and trading volume and history of our common stock.
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•
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Our current and future financial results and position.
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•
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The market’s view of our industry and products.
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•
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The perception in the equity and debt markets of our ability to execute our business plan or achieve our operating results expectations.
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
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ITEM 2.
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PROPERTIES
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ITEM 3.
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LEGAL PROCEEDINGS
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ITEM 4.
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MINE SAFETY DISCLOSURES
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ITEM 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
High
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Low
|
||||
Fiscal 2013
|
|
|
|
||||
First Quarter
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$
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2.51
|
|
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$
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1.90
|
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Second Quarter
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$
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2.41
|
|
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$
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1.40
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Third Quarter
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$
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1.98
|
|
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$
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1.12
|
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Fourth Quarter
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$
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3.09
|
|
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$
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1.60
|
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Fiscal 2014
|
|
|
|
||||
First Quarter
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$
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2.51
|
|
|
$
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2.00
|
|
Second Quarter
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$
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4.44
|
|
|
$
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2.30
|
|
Third Quarter
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$
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7.22
|
|
|
$
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3.50
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Fourth Quarter
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$
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8.11
|
|
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$
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4.71
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Equity Compensation Plan Information
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||||||||||
Plan Category
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Number of Securities to be Issued Upon Exercise of Outstanding Options and Vesting of Restricted Shares
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Weighted Average Exercise Price of Outstanding Options and Restricted Shares
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Number of Securities Remaining Available for
Future Issuances Under the Equity Compensation Plans (1) |
||||
Equity Compensation plans approved by security holders
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3,255,521
|
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$
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3.39
|
|
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1,291,996
|
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Equity Compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
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Total
|
|
3,255,521
|
|
|
$
|
3.39
|
|
|
1,291,996
|
|
(1)
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Excludes shares reflected in the column titled “Number of Securities to be Issued Upon Exercise of Outstanding Options”.
|
|
|
March 31, 2009
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|
March 31, 2010
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March 31, 2011
|
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March 31, 2012
|
|
March 31, 2013
|
|
March 31, 2014
|
||||||||||||
Orion Energy Systems, Inc.
|
|
$
|
100
|
|
|
$
|
111
|
|
|
$
|
92
|
|
|
$
|
54
|
|
|
$
|
56
|
|
|
$
|
164
|
|
Russell 2000 Index
|
|
$
|
100
|
|
|
$
|
163
|
|
|
$
|
205
|
|
|
$
|
208
|
|
|
$
|
236
|
|
|
$
|
297
|
|
NASDAQ Clean Edge Green Energy Index
|
|
$
|
100
|
|
|
$
|
149
|
|
|
$
|
162
|
|
|
$
|
101
|
|
|
$
|
104
|
|
|
$
|
197
|
|
ITEM 6.
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SELECTED FINANCIAL DATA
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|
Fiscal Year Ended March 31,
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||||||||||||||||||
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2010
|
|
2011
|
|
2012
|
|
2013
|
|
2014
|
||||||||||
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(in thousands, except per share amounts)
|
||||||||||||||||||
Consolidated statements of operations data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Product revenue
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$
|
60,882
|
|
|
$
|
75,870
|
|
|
$
|
90,782
|
|
|
$
|
72,604
|
|
|
$
|
71,954
|
|
Service revenue
|
7,191
|
|
|
6,167
|
|
|
9,780
|
|
|
13,482
|
|
|
16,669
|
|
|||||
Total revenue
|
68,073
|
|
|
82,037
|
|
|
100,562
|
|
|
86,086
|
|
|
88,623
|
|
|||||
Cost of product revenue(1)
|
40,063
|
|
|
49,809
|
|
|
62,842
|
|
|
49,551
|
|
|
54,423
|
|
|||||
Cost of service revenue
|
5,266
|
|
|
4,589
|
|
|
7,682
|
|
|
9,805
|
|
|
11,220
|
|
|||||
Total cost of revenue
|
45,329
|
|
|
54,398
|
|
|
70,524
|
|
|
59,356
|
|
|
65,643
|
|
|||||
Gross profit
|
22,744
|
|
|
27,639
|
|
|
30,038
|
|
|
26,730
|
|
|
22,980
|
|
|||||
General and administrative expenses(1)(2)(3)
|
12,836
|
|
|
11,686
|
|
|
11,399
|
|
|
13,946
|
|
|
14,951
|
|
|||||
Acquisition and integration related expenses (4)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
819
|
|
|||||
Sales and marketing expenses(1)(2)
|
12,596
|
|
|
13,674
|
|
|
15,599
|
|
|
17,129
|
|
|
13,527
|
|
|||||
Research and development expenses(1)
|
1,891
|
|
|
2,333
|
|
|
2,518
|
|
|
2,259
|
|
|
2,026
|
|
|||||
(Loss) Income from operations
|
(4,579
|
)
|
|
(54
|
)
|
|
522
|
|
|
(6,604
|
)
|
|
(8,343
|
)
|
|||||
Interest expense
|
(256
|
)
|
|
(406
|
)
|
|
(551
|
)
|
|
(567
|
)
|
|
(481
|
)
|
|||||
Gain on sale of OTA contract receivables
|
(561
|
)
|
|
(1,012
|
)
|
|
32
|
|
|
—
|
|
|
—
|
|
|||||
Extinguishment of debt
|
250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Dividend and interest income
|
670
|
|
|
571
|
|
|
850
|
|
|
845
|
|
|
567
|
|
|||||
Income (loss) before income tax
|
(4,476
|
)
|
|
(901
|
)
|
|
853
|
|
|
(6,326
|
)
|
|
(8,257
|
)
|
|||||
Income tax expense (benefit)(2)(3)
|
(1,003
|
)
|
|
(1,242
|
)
|
|
370
|
|
|
4,073
|
|
|
(2,058
|
)
|
|||||
Net income (loss) and comprehensive income (loss)
|
$
|
(3,473
|
)
|
|
$
|
341
|
|
|
$
|
483
|
|
|
$
|
(10,399
|
)
|
|
$
|
(6,199
|
)
|
Net income (loss) per share attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(0.16
|
)
|
|
$
|
0.02
|
|
|
$
|
0.02
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.30
|
)
|
Diluted
|
$
|
(0.16
|
)
|
|
$
|
0.01
|
|
|
$
|
0.02
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.30
|
)
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
21,844
|
|
|
22,678
|
|
|
22,953
|
|
|
20,997
|
|
|
20,988
|
|
|||||
Diluted
|
21,844
|
|
|
23,198
|
|
|
23,387
|
|
|
20,997
|
|
|
20,988
|
|
(1)
|
Includes stock-based compensation expense recognized under Financial Accounting Standards Board Accounting Standards Codification Topic 718, or ASC Topic 718, as follows:
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
|
(in thousands)
|
||||||||||
Cost of product revenue
|
$
|
189
|
|
|
$
|
114
|
|
|
$
|
70
|
|
General and administrative expenses
|
548
|
|
|
578
|
|
|
1,025
|
|
|||
Sales and marketing expenses
|
501
|
|
|
451
|
|
|
485
|
|
|||
Research and development expenses
|
29
|
|
|
21
|
|
|
13
|
|
|||
Total stock-based compensation expense
|
$
|
1,267
|
|
|
$
|
1,164
|
|
|
$
|
1,593
|
|
(2)
|
Includes fiscal 2013 reorganization expenses of $1.9 million in general and administrative expenses, $0.2 million in sales and marketing expenses and a $4.1 million valuation reserve for deferred tax assets in income tax expense.
|
(3)
|
Includes fiscal 2014 loss on sale of a leased corporate jet of $1.5 million in general and administrative expenses and a $2.3 million benefit for deferred tax liabilities created by the acquisition of Harris in income tax benefit.
|
|
As of March 31,
|
||||||||||||||||||
|
2010
|
|
2011
|
|
2012
|
|
2013
|
|
2014
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Consolidated balance sheet data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
23,364
|
|
|
$
|
11,560
|
|
|
$
|
23,011
|
|
|
$
|
14,376
|
|
|
$
|
17,568
|
|
Short-term investments
|
1,000
|
|
|
1,011
|
|
|
1,016
|
|
|
1,021
|
|
|
470
|
|
|||||
Total assets
|
104,578
|
|
|
121,087
|
|
|
125,650
|
|
|
102,097
|
|
|
98,940
|
|
|||||
Long-term debt, less current maturities
|
3,156
|
|
|
4,225
|
|
|
6,704
|
|
|
4,109
|
|
|
3,151
|
|
|||||
Shareholder notes receivable
|
—
|
|
|
(193
|
)
|
|
(221
|
)
|
|
(265
|
)
|
|
(50
|
)
|
|||||
Total shareholders’ equity
|
$
|
88,387
|
|
|
$
|
90,455
|
|
|
$
|
92,769
|
|
|
$
|
77,769
|
|
|
$
|
77,012
|
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
Fiscal 2015
|
$
|
247
|
|
Fiscal 2016
|
247
|
|
|
Fiscal 2017
|
247
|
|
|
Fiscal 2018
|
246
|
|
|
Fiscal 2019
|
246
|
|
|
Beyond
|
676
|
|
|
Total expected future discounted revenue from PPA's
|
$
|
1,909
|
|
|
Fiscal Year Ended March 31,
|
|||||||||||||||||||||||||
|
2012
|
|
2013
|
|
|
|
2014
|
|
|
|||||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||
|
Amount
|
|
% of
Revenue |
|
Amount
|
|
% of
Revenue |
|
%
Change |
|
Amount
|
|
% of
Revenue |
|
%
Change |
|||||||||||
Product revenue
|
$
|
90,782
|
|
|
90.3
|
%
|
|
$
|
72,604
|
|
|
84.3
|
%
|
|
(20.0
|
)%
|
|
$
|
71,954
|
|
|
81.2
|
%
|
|
(0.9
|
)%
|
Service revenue
|
9,780
|
|
|
9.7
|
%
|
|
13,482
|
|
|
15.7
|
%
|
|
37.9
|
%
|
|
16,669
|
|
|
18.8
|
%
|
|
23.6
|
%
|
|||
Total revenue
|
100,562
|
|
|
100.0
|
%
|
|
86,086
|
|
|
100.0
|
%
|
|
(14.4
|
)%
|
|
88,623
|
|
|
100.0
|
%
|
|
2.9
|
%
|
|||
Cost of product revenue
|
62,842
|
|
|
62.5
|
%
|
|
49,551
|
|
|
57.5
|
%
|
|
(21.1
|
)%
|
|
54,423
|
|
|
61.4
|
%
|
|
9.8
|
%
|
|||
Cost of service revenue
|
7,682
|
|
|
7.6
|
%
|
|
9,805
|
|
|
11.4
|
%
|
|
27.6
|
%
|
|
11,220
|
|
|
12.7
|
%
|
|
14.4
|
%
|
|||
Total cost of revenue
|
70,524
|
|
|
70.1
|
%
|
|
59,356
|
|
|
68.9
|
%
|
|
(15.8
|
)%
|
|
65,643
|
|
|
74.1
|
%
|
|
10.6
|
%
|
|||
Gross profit
|
30,038
|
|
|
29.9
|
%
|
|
26,730
|
|
|
31.1
|
%
|
|
(11.0
|
)%
|
|
22,980
|
|
|
25.9
|
%
|
|
(14.0
|
)%
|
|||
General and administrative expenses
|
11,399
|
|
|
11.3
|
%
|
|
13,946
|
|
|
16.2
|
%
|
|
22.3
|
%
|
|
14,951
|
|
|
16.9
|
%
|
|
7.2
|
%
|
|||
Acquisition and integration related expenses
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
%
|
|
819
|
|
|
0.9
|
%
|
|
—
|
%
|
|||
Sales and marketing expenses
|
15,599
|
|
|
15.5
|
%
|
|
17,129
|
|
|
19.9
|
%
|
|
9.8
|
%
|
|
13,527
|
|
|
15.3
|
%
|
|
(21.0
|
)%
|
|||
Research and development expenses
|
2,518
|
|
|
2.6
|
%
|
|
2,259
|
|
|
2.7
|
%
|
|
(10.3
|
)%
|
|
2,026
|
|
|
2.2
|
%
|
|
(10.3
|
)%
|
|||
Income (loss) from operations
|
522
|
|
|
0.5
|
%
|
|
(6,604
|
)
|
|
(7.7
|
)%
|
|
(1,365.1
|
)%
|
|
(8,343
|
)
|
|
(9.4
|
)%
|
|
26.3
|
%
|
|||
Interest expense
|
(551
|
)
|
|
(0.5
|
)%
|
|
(567
|
)
|
|
(0.6
|
)%
|
|
2.9
|
%
|
|
(481
|
)
|
|
(0.5
|
)%
|
|
(15.2
|
)%
|
|||
Gain on sale of OTA contract receivables
|
32
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
(100.0
|
)%
|
|
—
|
|
|
—
|
%
|
|
—
|
%
|
|||
Interest income
|
850
|
|
|
0.9
|
%
|
|
845
|
|
|
1.0
|
%
|
|
(0.6
|
)%
|
|
567
|
|
|
0.6
|
%
|
|
(32.9
|
)%
|
|||
Income (loss) before income tax
|
853
|
|
|
0.9
|
%
|
|
(6,326
|
)
|
|
(7.3
|
)%
|
|
(841.6
|
)%
|
|
(8,257
|
)
|
|
(9.3
|
)%
|
|
30.5
|
%
|
|||
Income tax expense (benefit)
|
370
|
|
|
0.4
|
%
|
|
4,073
|
|
|
4.8
|
%
|
|
1,000.8
|
%
|
|
(2,058
|
)
|
|
(2.3
|
)%
|
|
(150.5
|
)%
|
|||
Net income (loss) and comprehensive income (loss)
|
$
|
483
|
|
|
0.5
|
%
|
|
$
|
(10,399
|
)
|
|
(12.1
|
)%
|
|
(2,253.0
|
)%
|
|
$
|
(6,199
|
)
|
|
(7.0
|
)%
|
|
(40.4
|
)%
|
|
For the year ended March 31,
|
||||||||||
(dollars in thousands)
|
2012
|
|
2013
|
|
2014
|
||||||
Revenues
|
$
|
72,097
|
|
|
$
|
67,437
|
|
|
$
|
66,793
|
|
Operating income
|
$
|
4,974
|
|
|
$
|
245
|
|
|
$
|
(1,743
|
)
|
Operating margin
|
6.9
|
%
|
|
0.4
|
%
|
|
(2.6
|
)%
|
|
For the year ended March 31,
|
||||||||||
(dollars in thousands)
|
2012
|
|
2013
|
|
2014
|
||||||
Revenues
|
$
|
28,465
|
|
|
$
|
18,649
|
|
|
$
|
21,830
|
|
Operating income
|
$
|
569
|
|
|
$
|
671
|
|
|
$
|
1,991
|
|
Operating margin
|
2.0
|
%
|
|
3.6
|
%
|
|
9.1
|
%
|
|
For the Three Months Ended
|
||||||||||||||||||||||||||||||
|
Jun 30, 2012
|
|
Sep 30, 2012
|
|
Dec 31, 2012
|
|
Mar 31, 2013
|
|
Jun 30, 2013
|
|
Sep 30, 2013
|
|
Dec 31, 2013
|
|
Mar 31, 2014
|
||||||||||||||||
|
(in thousands, unaudited)
|
||||||||||||||||||||||||||||||
Product revenue
|
$
|
13,580
|
|
|
$
|
16,931
|
|
|
$
|
22,660
|
|
|
$
|
19,433
|
|
|
$
|
17,523
|
|
|
$
|
21,181
|
|
|
$
|
22,380
|
|
|
$
|
10,870
|
|
Service revenue
|
1,730
|
|
|
2,477
|
|
|
6,427
|
|
|
2,848
|
|
|
3,329
|
|
|
6,314
|
|
|
5,312
|
|
|
1,714
|
|
||||||||
Total revenue
|
15,310
|
|
|
19,408
|
|
|
29,087
|
|
|
22,281
|
|
|
20,852
|
|
|
27,495
|
|
|
27,692
|
|
|
12,584
|
|
||||||||
Cost of product revenue
|
9,597
|
|
|
11,867
|
|
|
15,708
|
|
|
12,379
|
|
|
12,884
|
|
|
15,638
|
|
|
15,742
|
|
|
10,159
|
|
||||||||
Cost of service revenue
|
1,340
|
|
|
1,736
|
|
|
4,798
|
|
|
1,931
|
|
|
2,245
|
|
|
4,028
|
|
|
3,800
|
|
|
1,147
|
|
||||||||
Total cost of revenue
|
10,937
|
|
|
13,603
|
|
|
20,506
|
|
|
14,310
|
|
|
15,129
|
|
|
19,666
|
|
|
19,542
|
|
|
11,306
|
|
||||||||
Gross profit
|
4,373
|
|
|
5,805
|
|
|
8,581
|
|
|
7,971
|
|
|
5,723
|
|
|
7,829
|
|
|
8,150
|
|
|
1,278
|
|
||||||||
General and administrative expenses
|
3,302
|
|
|
4,638
|
|
|
2,848
|
|
|
3,158
|
|
|
2,759
|
|
|
3,173
|
|
|
3,277
|
|
|
5,817
|
|
||||||||
Acquisition and integration related
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
356
|
|
|
88
|
|
|
300
|
|
||||||||
Sales and marketing expenses
|
3,952
|
|
|
4,561
|
|
|
4,730
|
|
|
3,886
|
|
|
3,303
|
|
|
3,644
|
|
|
3,397
|
|
|
3,183
|
|
||||||||
Research and development expenses
|
697
|
|
|
710
|
|
|
427
|
|
|
425
|
|
|
490
|
|
|
448
|
|
|
478
|
|
|
610
|
|
||||||||
Income (loss) from operations
|
(3,578
|
)
|
|
(4,104
|
)
|
|
576
|
|
|
502
|
|
|
(829
|
)
|
|
208
|
|
|
910
|
|
|
(8,632
|
)
|
||||||||
Interest expense
|
(161
|
)
|
|
(142
|
)
|
|
(138
|
)
|
|
(126
|
)
|
|
(113
|
)
|
|
(142
|
)
|
|
(123
|
)
|
|
(103
|
)
|
||||||||
Interest income
|
225
|
|
|
218
|
|
|
213
|
|
|
189
|
|
|
174
|
|
|
153
|
|
|
132
|
|
|
108
|
|
||||||||
Income (loss) before income tax
|
(3,514
|
)
|
|
(4,028
|
)
|
|
651
|
|
|
565
|
|
|
(768
|
)
|
|
219
|
|
|
919
|
|
|
(8,627
|
)
|
||||||||
Income tax expense (benefit)
|
(1,574
|
)
|
|
5,631
|
|
|
—
|
|
|
16
|
|
|
13
|
|
|
(2,184
|
)
|
|
(99
|
)
|
|
212
|
|
||||||||
Net income (loss) and comprehensive income (loss)
|
$
|
(1,940
|
)
|
|
$
|
(9,659
|
)
|
|
$
|
651
|
|
|
$
|
549
|
|
|
$
|
(781
|
)
|
|
$
|
2,403
|
|
|
$
|
1,018
|
|
|
$
|
(8,839
|
)
|
|
Jun 30, 2012
|
|
Sep 30, 2012
|
|
Dec 31, 2012
|
|
Mar 31, 2013
|
|
Jun 30, 2013
|
|
Sep 30, 2013
|
|
Dec 31, 2013
|
|
Mar 31, 2014
|
||||||||
|
(in thousands, unaudited)
|
||||||||||||||||||||||
Product revenue
|
88.7
|
%
|
|
87.2
|
%
|
|
77.9
|
%
|
|
87.2
|
%
|
|
84.0
|
%
|
|
77.0
|
%
|
|
80.8
|
%
|
|
86.4
|
%
|
Service revenue
|
11.3
|
%
|
|
12.8
|
%
|
|
22.1
|
%
|
|
12.8
|
%
|
|
16.0
|
%
|
|
23.0
|
%
|
|
19.2
|
%
|
|
13.6
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of product revenue
|
62.7
|
%
|
|
61.1
|
%
|
|
54.0
|
%
|
|
55.6
|
%
|
|
61.8
|
%
|
|
56.9
|
%
|
|
56.9
|
%
|
|
80.7
|
%
|
Cost of service revenue
|
8.7
|
%
|
|
9.0
|
%
|
|
16.5
|
%
|
|
8.6
|
%
|
|
10.8
|
%
|
|
14.6
|
%
|
|
13.7
|
%
|
|
9.1
|
%
|
Total cost of revenue
|
71.4
|
%
|
|
70.1
|
%
|
|
70.5
|
%
|
|
64.2
|
%
|
|
72.6
|
%
|
|
71.5
|
%
|
|
70.6
|
%
|
|
89.8
|
%
|
Gross margin
|
28.6
|
%
|
|
29.9
|
%
|
|
29.5
|
%
|
|
35.8
|
%
|
|
27.4
|
%
|
|
28.5
|
%
|
|
29.4
|
%
|
|
10.2
|
%
|
General and administrative expenses
|
21.6
|
%
|
|
23.9
|
%
|
|
9.8
|
%
|
|
14.2
|
%
|
|
13.2
|
%
|
|
11.5
|
%
|
|
11.8
|
%
|
|
46.2
|
%
|
Acquisition and integration related expenses
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
1.3
|
%
|
|
0.3
|
%
|
|
2.4
|
%
|
Sales and marketing expenses
|
25.8
|
%
|
|
23.5
|
%
|
|
16.3
|
%
|
|
17.4
|
%
|
|
15.9
|
%
|
|
13.3
|
%
|
|
12.3
|
%
|
|
25.3
|
%
|
Research and development expenses
|
4.6
|
%
|
|
3.6
|
%
|
|
1.4
|
%
|
|
1.9
|
%
|
|
2.3
|
%
|
|
1.6
|
%
|
|
1.7
|
%
|
|
4.9
|
%
|
Income (loss) from operations
|
(23.4
|
)%
|
|
(21.1
|
)%
|
|
2.0
|
%
|
|
2.3
|
%
|
|
(4.0
|
)%
|
|
0.8
|
%
|
|
3.3
|
%
|
|
(68.6
|
)%
|
Interest expense
|
(1.1
|
)%
|
|
(0.8
|
)%
|
|
(0.5
|
)%
|
|
(0.6
|
)%
|
|
(0.5
|
)%
|
|
(0.6
|
)%
|
|
(0.5
|
)%
|
|
(0.9
|
)%
|
Interest income
|
1.5
|
%
|
|
1.1
|
%
|
|
0.7
|
%
|
|
0.8
|
%
|
|
0.8
|
%
|
|
0.6
|
%
|
|
0.5
|
%
|
|
0.9
|
%
|
Income (loss) before income tax
|
(23.0
|
)%
|
|
(20.8
|
)%
|
|
2.2
|
%
|
|
2.5
|
%
|
|
(3.7
|
)%
|
|
0.8
|
%
|
|
3.3
|
%
|
|
(68.6
|
)%
|
Income tax expense (benefit)
|
(10.3
|
)%
|
|
29.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
(7.9
|
)%
|
|
(0.4
|
)%
|
|
1.6
|
%
|
Net income (loss) and comprehensive income (loss)
|
(12.7
|
)%
|
|
(49.8
|
)%
|
|
2.2
|
%
|
|
2.5
|
%
|
|
(3.7
|
)%
|
|
8.7
|
%
|
|
3.7
|
%
|
|
(70.2
|
)%
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
|
(in thousands)
|
||||||||||
Operating activities
|
$
|
11,495
|
|
|
$
|
2,261
|
|
|
$
|
9,901
|
|
Investing activities
|
(4,532
|
)
|
|
(2,271
|
)
|
|
(4,814
|
)
|
|||
Financing activities
|
4,488
|
|
|
(8,625
|
)
|
|
(1,895
|
)
|
|||
(Decrease) increase in cash and cash equivalents
|
$
|
11,451
|
|
|
$
|
(8,635
|
)
|
|
$
|
3,192
|
|
|
Payments Due By Period
|
||||||||||||||||||
|
Total
|
|
Less than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More than
5 Years
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Bank debt obligations
|
$
|
6,602
|
|
|
$
|
3,450
|
|
|
$
|
2,617
|
|
|
$
|
130
|
|
|
$
|
405
|
|
Cash interest payments on debt
|
546
|
|
|
251
|
|
|
144
|
|
|
62
|
|
|
89
|
|
|||||
Operating lease obligations
|
651
|
|
|
289
|
|
|
291
|
|
|
71
|
|
|
—
|
|
|||||
Purchase order and capital expenditure commitments(1)
|
4,431
|
|
|
4,431
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
12,230
|
|
|
$
|
8,421
|
|
|
$
|
3,052
|
|
|
$
|
263
|
|
|
$
|
494
|
|
(1)
|
Reflects non-cancellable purchase commitments in the amount of $4.4 million for certain inventory items entered into in order to secure better pricing and ensure materials on hand.
|
Level 1 —
|
|
Quoted prices in active markets for identical assets or liabilities.
|
|
|
|
Level 2 —
|
|
Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
|
|
|
|
Level 3 —
|
|
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
|
Fiscal Year Ended March 31,
|
||||
|
2012
|
|
2013
|
|
2014
|
Weighted average expected term
|
5.7 years
|
|
5.5 years
|
|
4.1 years
|
Risk-free interest rate
|
1.5%
|
|
0.8%
|
|
0.8%
|
Expected volatility
|
70.0%
|
|
72.5% – 74.4%
|
|
73.3%
|
Expected forfeiture rate
|
15.1%
|
|
21.4%
|
|
20.3%
|
Item 7A
|
Quantitative and Qualitative Disclosure About Market Risk
|
ITEM 8.
|
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
March 31,
|
||||||
|
2013
|
|
2014
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
14,376
|
|
|
$
|
17,568
|
|
Short-term investments
|
1,021
|
|
|
470
|
|
||
Accounts receivable, net of allowances of $900 and $384
|
18,397
|
|
|
15,098
|
|
||
Inventories, net
|
14,313
|
|
|
11,790
|
|
||
Deferred contract costs
|
2,118
|
|
|
742
|
|
||
Prepaid expenses and other current assets
|
2,465
|
|
|
4,673
|
|
||
Total current assets
|
52,690
|
|
|
50,341
|
|
||
Property and equipment, net
|
27,947
|
|
|
23,135
|
|
||
Long-term inventory
|
12,408
|
|
|
10,607
|
|
||
Goodwill
|
—
|
|
|
4,409
|
|
||
Other intangible assets, net
|
1,709
|
|
|
7,551
|
|
||
Long-term accounts receivable
|
5,069
|
|
|
1,966
|
|
||
Other long-term assets
|
2,274
|
|
|
931
|
|
||
Total assets
|
$
|
102,097
|
|
|
$
|
98,940
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
||||
Accounts payable
|
$
|
7,773
|
|
|
$
|
8,530
|
|
Accrued expenses and other
|
5,457
|
|
|
4,597
|
|
||
Deferred revenue, current
|
2,946
|
|
|
614
|
|
||
Current maturities of long-term debt
|
2,597
|
|
|
3,450
|
|
||
Total current liabilities
|
18,773
|
|
|
17,191
|
|
||
Long-term debt, less current maturities
|
4,109
|
|
|
3,151
|
|
||
Deferred revenue, long-term
|
1,258
|
|
|
1,316
|
|
||
Other long-term liabilities
|
188
|
|
|
270
|
|
||
Total liabilities
|
24,328
|
|
|
21,928
|
|
||
Commitments and contingencies (See Note G)
|
—
|
|
|
—
|
|
||
Shareholders’ equity:
|
|
|
|
||||
Preferred stock, $0.01 par value: Shares authorized: 30,000,000 shares at March 31, 2013 and 2014; no shares issued and outstanding at March 31, 2013 and 2014
|
—
|
|
|
—
|
|
||
Common stock, no par value: Shares authorized: 200,000,000 at March 31, 2013 and 2014; shares issued: 30,498,900 and 31,001,683 at March 31, 2013 and 2014; shares outstanding: 20,162,397 and 21,588,326 at March 31, 2013 and 2014
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
128,104
|
|
|
130,766
|
|
||
Treasury stock: 10,336,503 and 9,413,357 common shares at March 31, 2013 and 2014
|
(38,378
|
)
|
|
(35,813
|
)
|
||
Shareholder notes receivable
|
(265
|
)
|
|
(50
|
)
|
||
Retained deficit
|
(11,692
|
)
|
|
(17,891
|
)
|
||
Total shareholders’ equity
|
77,769
|
|
|
77,012
|
|
||
Total liabilities and shareholders’ equity
|
$
|
102,097
|
|
|
98,940
|
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Product revenue
|
$
|
90,782
|
|
|
$
|
72,604
|
|
|
$
|
71,954
|
|
Service revenue
|
9,780
|
|
|
13,482
|
|
|
16,669
|
|
|||
Total revenue
|
100,562
|
|
|
86,086
|
|
|
88,623
|
|
|||
Cost of product revenue
|
62,842
|
|
|
49,551
|
|
|
54,423
|
|
|||
Cost of service revenue
|
7,682
|
|
|
9,805
|
|
|
11,220
|
|
|||
Total cost of revenue
|
70,524
|
|
|
59,356
|
|
|
65,643
|
|
|||
Gross profit
|
30,038
|
|
|
26,730
|
|
|
22,980
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
General and administrative
|
11,399
|
|
|
13,946
|
|
|
14,951
|
|
|||
Acquisition and integration related expenses
|
—
|
|
|
—
|
|
|
819
|
|
|||
Sales and marketing
|
15,599
|
|
|
17,129
|
|
|
13,527
|
|
|||
Research and development
|
2,518
|
|
|
2,259
|
|
|
2,026
|
|
|||
Total operating expenses
|
29,516
|
|
|
33,334
|
|
|
31,323
|
|
|||
Income (loss) from operations
|
522
|
|
|
(6,604
|
)
|
|
(8,343
|
)
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
(551
|
)
|
|
(567
|
)
|
|
(481
|
)
|
|||
Gain on sale of OTA contract receivables
|
32
|
|
|
—
|
|
|
—
|
|
|||
Interest income
|
850
|
|
|
845
|
|
|
567
|
|
|||
Total other income
|
331
|
|
|
278
|
|
|
86
|
|
|||
Income (loss) before income tax
|
853
|
|
|
(6,326
|
)
|
|
(8,257
|
)
|
|||
Income tax expense (benefit)
|
370
|
|
|
4,073
|
|
|
(2,058
|
)
|
|||
Net income (loss) and comprehensive income (loss)
|
$
|
483
|
|
|
$
|
(10,399
|
)
|
|
$
|
(6,199
|
)
|
Basic net income (loss) per share attributable to common shareholders
|
$
|
0.02
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.30
|
)
|
Weighted-average common shares outstanding
|
22,953,037
|
|
|
20,996,625
|
|
|
20,987,964
|
|
|||
Diluted net income (loss) per share
|
$
|
0.02
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.30
|
)
|
Weighted-average common shares and share equivalents outstanding
|
23,386,525
|
|
|
20,996,625
|
|
|
20,987,964
|
|
|
Shareholders’ Equity
|
|||||||||||||||||||||
|
Common Stock
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Shares
|
|
Additional
Paid-in Capital |
|
Treasury
Stock |
|
Shareholder
Notes Receivable |
|
Retained
Earnings (Deficit) |
|
Total
Shareholders’ Equity |
|||||||||||
Balance, March 31, 2011
|
22,893,803
|
|
|
$
|
124,132
|
|
|
$
|
(31,708
|
)
|
|
$
|
(193
|
)
|
|
$
|
(1,776
|
)
|
|
$
|
90,455
|
|
Issuance of stock and warrants for services
|
29,308
|
|
|
85
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|||||
Exercise of stock options and warrants for cash
|
103,413
|
|
|
147
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
147
|
|
|||||
Shares issued under Employee Stock Purchase Plan
|
37,034
|
|
|
133
|
|
|
(22
|
)
|
|
(84
|
)
|
|
—
|
|
|
27
|
|
|||||
Tax expense from exercise of stock options
|
—
|
|
|
989
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
989
|
|
|||||
Collection of shareholder notes receivable
|
—
|
|
|
—
|
|
|
—
|
|
|
56
|
|
|
—
|
|
|
56
|
|
|||||
Stock-based compensation
|
—
|
|
|
1,267
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,267
|
|
|||||
Treasury stock purchase
|
(278,300
|
)
|
|
—
|
|
|
(740
|
)
|
|
—
|
|
|
—
|
|
|
(740
|
)
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
483
|
|
|
483
|
|
|||||
Balance, March 31, 2012
|
22,785,258
|
|
|
$
|
126,753
|
|
|
$
|
(32,470
|
)
|
|
$
|
(221
|
)
|
|
$
|
(1,293
|
)
|
|
$
|
92,769
|
|
Issuance of stock and warrants for services
|
33,422
|
|
|
71
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|||||
Exercise of stock options and warrants for cash
|
20,000
|
|
|
45
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|||||
Shares issued under Employee Stock Purchase Plan
|
47,598
|
|
|
1
|
|
|
94
|
|
|
(82
|
)
|
|
—
|
|
|
13
|
|
|||||
Tax benefit from exercise of stock options
|
—
|
|
|
70
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
70
|
|
|||||
Collection of shareholder notes receivable
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|
38
|
|
|||||
Stock-based compensation
|
—
|
|
|
1,164
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,164
|
|
|||||
Treasury stock purchase
|
(2,723,881
|
)
|
|
—
|
|
|
(6,002
|
)
|
|
—
|
|
|
—
|
|
|
(6,002
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,399
|
)
|
|
(10,399
|
)
|
|||||
Balance, March 31, 2013
|
20,162,397
|
|
|
$
|
128,104
|
|
|
$
|
(38,378
|
)
|
|
$
|
(265
|
)
|
|
$
|
(11,692
|
)
|
|
$
|
77,769
|
|
Issuance of stock and warrants for services
|
33,641
|
|
|
129
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
129
|
|
|||||
Stock activity for acquisition
|
940,940
|
|
|
—
|
|
|
2,382
|
|
|
—
|
|
|
—
|
|
|
2,382
|
|
|||||
Exercise of stock options and warrants for cash
|
446,059
|
|
|
1,152
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,152
|
|
|||||
Shares issued under Employee Stock Purchase Plan
|
2,373
|
|
|
(4
|
)
|
|
10
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Tax benefit from exercise of stock options
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|||||
Collection of shareholder notes receivable
|
—
|
|
|
—
|
|
|
—
|
|
|
215
|
|
|
—
|
|
|
215
|
|
|||||
Stock-based compensation
|
23,084
|
|
|
1,593
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,593
|
|
|||||
Treasury stock purchase
|
(20,168
|
)
|
|
—
|
|
|
(48
|
)
|
|
—
|
|
|
—
|
|
|
(48
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,199
|
)
|
|
(6,199
|
)
|
|||||
Balance, March 31, 2014
|
21,588,326
|
|
|
$
|
130,987
|
|
|
$
|
(36,034
|
)
|
|
$
|
(50
|
)
|
|
$
|
(17,891
|
)
|
|
$
|
77,012
|
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Operating activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
483
|
|
|
$
|
(10,399
|
)
|
|
$
|
(6,199
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by
|
|
|
|
|
|
||||||
operating activities:
|
|
|
|
|
|
||||||
Depreciation
|
3,981
|
|
|
4,322
|
|
|
3,798
|
|
|||
Amortization
|
255
|
|
|
255
|
|
|
740
|
|
|||
Stock-based compensation expense
|
1,267
|
|
|
1,164
|
|
|
1,593
|
|
|||
Accretion of fair value on contingent consideration
|
—
|
|
|
—
|
|
|
11
|
|
|||
Deferred income tax (benefit) expense
|
(755
|
)
|
|
4,158
|
|
|
(2,123
|
)
|
|||
Loss on sale of property and equipment
|
133
|
|
|
69
|
|
|
1,733
|
|
|||
Provision for inventory reserves
|
167
|
|
|
859
|
|
|
1,995
|
|
|||
Provision for bad debts
|
566
|
|
|
757
|
|
|
174
|
|
|||
Other
|
85
|
|
|
71
|
|
|
129
|
|
|||
Changes in operating assets and liabilities, net of changes from acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable, current and long-term
|
3,364
|
|
|
2,499
|
|
|
8,395
|
|
|||
Inventories, current and long-term
|
(1,538
|
)
|
|
2,880
|
|
|
3,962
|
|
|||
Deferred contract costs
|
7,396
|
|
|
75
|
|
|
1,376
|
|
|||
Prepaid expenses and other current assets
|
(2,025
|
)
|
|
1,315
|
|
|
(1,072
|
)
|
|||
Accounts payable
|
1,817
|
|
|
(6,527
|
)
|
|
(762
|
)
|
|||
Accrued expenses and other
|
841
|
|
|
2,221
|
|
|
(1,575
|
)
|
|||
Deferred revenue, current and long-term
|
(4,542
|
)
|
|
(1,458
|
)
|
|
(2,274
|
)
|
|||
Net cash provided by operating activities
|
11,495
|
|
|
2,261
|
|
|
9,901
|
|
|||
Investing activities
|
|
|
|
|
|
||||||
Cash paid for acquisition, net of cash acquired
|
—
|
|
|
—
|
|
|
(4,992
|
)
|
|||
Purchase of property and equipment
|
(4,324
|
)
|
|
(2,159
|
)
|
|
(410
|
)
|
|||
Purchase of property and equipment leased to customers under PPAs
|
(3
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of short-term investments
|
(5
|
)
|
|
(5
|
)
|
|
(4
|
)
|
|||
Sale of short-term investments
|
—
|
|
|
—
|
|
|
555
|
|
|||
Additions to patents and licenses
|
(224
|
)
|
|
(153
|
)
|
|
(43
|
)
|
|||
Proceeds from sales of property, plant and equipment
|
24
|
|
|
46
|
|
|
80
|
|
|||
Net cash used in investing activities
|
(4,532
|
)
|
|
(2,271
|
)
|
|
(4,814
|
)
|
|||
Financing activities
|
|
|
|
|
|
||||||
Payment of long-term debt
|
(1,856
|
)
|
|
(3,169
|
)
|
|
(3,229
|
)
|
|||
Proceeds from long-term debt
|
5,989
|
|
|
380
|
|
|
—
|
|
|||
Proceeds from repayment of shareholder notes
|
56
|
|
|
38
|
|
|
215
|
|
|||
Repurchase of common stock into treasury
|
(740
|
)
|
|
(6,007
|
)
|
|
—
|
|
|||
Excess tax benefits from stock-based compensation
|
989
|
|
|
70
|
|
|
13
|
|
|||
Deferred financing costs
|
(124
|
)
|
|
—
|
|
|
(19
|
)
|
|||
Proceeds from issuance of common stock
|
174
|
|
|
63
|
|
|
1,125
|
|
|||
Net cash provided by (used in) financing activities
|
4,488
|
|
|
(8,625
|
)
|
|
(1,895
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
11,451
|
|
|
(8,635
|
)
|
|
3,192
|
|
|||
Cash and cash equivalents at beginning of period
|
11,560
|
|
|
23,011
|
|
|
14,376
|
|
|||
Cash and cash equivalents at end of period
|
$
|
23,011
|
|
|
$
|
14,376
|
|
|
$
|
17,568
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
488
|
|
|
$
|
535
|
|
|
$
|
423
|
|
Cash paid for income taxes
|
$
|
104
|
|
|
$
|
102
|
|
|
$
|
22
|
|
Supplemental disclosure of non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Shares issued from treasury for shareholder note receivable
|
$
|
84
|
|
|
$
|
82
|
|
|
$
|
—
|
|
Shares returned to treasury in satisfaction of receivable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
Acquisition related contingent consideration liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
612
|
|
Acquisition financed through debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,123
|
|
Common stock issued for acquisition
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,416
|
|
March 31, 2013
|
|||||||||||||||||||||||
|
Amortized
Cost |
|
Unrealized
Gains |
|
Unrealized
Losses |
|
Fair Value
|
|
Cash and Cash
Equivalents |
|
Short-Term
Investments |
||||||||||||
Money market funds
|
$
|
487
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
487
|
|
|
$
|
487
|
|
|
$
|
—
|
|
Bank certificate of deposit
|
1,021
|
|
|
—
|
|
|
—
|
|
|
1,021
|
|
|
—
|
|
|
1,021
|
|
||||||
Total
|
$
|
1,508
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,508
|
|
|
$
|
487
|
|
|
$
|
1,021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
March 31, 2014
|
|||||||||||||||||||||||
|
Amortized
Cost |
|
Unrealized
Gains |
|
Unrealized
Losses |
|
Fair Value
|
|
Cash and Cash
Equivalents |
|
Short-Term
Investments |
||||||||||||
Money market funds
|
$
|
488
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
488
|
|
|
$
|
488
|
|
|
$
|
—
|
|
Bank certificate of deposit
|
470
|
|
|
—
|
|
|
—
|
|
|
470
|
|
|
—
|
|
|
470
|
|
||||||
Total
|
$
|
958
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
958
|
|
|
$
|
488
|
|
|
$
|
470
|
|
|
Not Past Due
|
|
1-90 days
past due |
|
Greater than 90
days past due |
|
Total past due
|
|
Total sales-type
leases |
||||||||||
Lease balances included in consolidated accounts receivable—current
|
$
|
2,817
|
|
|
$
|
97
|
|
|
$
|
151
|
|
|
$
|
248
|
|
|
$
|
3,065
|
|
Lease balances included in consolidated accounts receivable—long-term
|
4,009
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,009
|
|
|||||
Total gross sales-type leases
|
6,826
|
|
|
97
|
|
|
151
|
|
|
248
|
|
|
7,074
|
|
|||||
Allowance
|
—
|
|
|
—
|
|
|
(74
|
)
|
|
(74
|
)
|
|
(74
|
)
|
|||||
Total net sales-type leases
|
$
|
6,826
|
|
|
$
|
97
|
|
|
$
|
77
|
|
|
$
|
174
|
|
|
$
|
7,000
|
|
|
Not Past Due
|
|
1-90 days
past due |
|
Greater than 90
days past due |
|
Total past due
|
|
Total sales-type
leases |
||||||||||
Lease balances included in consolidated accounts receivable—current
|
$
|
2,067
|
|
|
$
|
137
|
|
|
$
|
149
|
|
|
$
|
286
|
|
|
$
|
2,353
|
|
Lease balances included in consolidated accounts receivable—long-term
|
1,662
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,662
|
|
|||||
Total gross sales-type leases
|
3,729
|
|
|
137
|
|
|
149
|
|
|
286
|
|
|
4,015
|
|
|||||
Allowance
|
(3
|
)
|
|
(3
|
)
|
|
(88
|
)
|
|
(91
|
)
|
|
(94
|
)
|
|||||
Total net sales-type leases
|
$
|
3,726
|
|
|
$
|
134
|
|
|
$
|
61
|
|
|
$
|
195
|
|
|
$
|
3,921
|
|
|
Balance at
beginning of period |
|
Provisions
charged to expense |
|
Write offs
and other |
|
Balance at
end of period |
|||||||||
March 31,
|
(in Thousands)
|
|||||||||||||||
2013
|
Allowance for Doubtful Accounts on financing receivables
|
$
|
24
|
|
|
$
|
50
|
|
|
$
|
—
|
|
|
$
|
74
|
|
2014
|
Allowance for Doubtful Accounts on financing receivables
|
$
|
74
|
|
|
$
|
96
|
|
|
$
|
76
|
|
|
$
|
94
|
|
|
March 31, 2013
|
|
March 31, 2014
|
||||
Raw materials and components
|
$
|
7,290
|
|
|
$
|
6,894
|
|
Work in process
|
846
|
|
|
880
|
|
||
Finished goods
|
6,177
|
|
|
4,016
|
|
||
|
$
|
14,313
|
|
|
$
|
11,790
|
|
|
March 31, 2013
|
|
March 31, 2014
|
||||
Land and land improvements
|
$
|
1,562
|
|
|
$
|
1,480
|
|
Buildings
|
15,918
|
|
|
14,405
|
|
||
Furniture, fixtures and office equipment
|
11,995
|
|
|
10,713
|
|
||
Leasehold improvements
|
58
|
|
|
46
|
|
||
Equipment leased to customers under Power Purchase Agreements
|
4,997
|
|
|
4,997
|
|
||
Plant equipment
|
10,620
|
|
|
10,103
|
|
||
Construction in progress
|
91
|
|
|
60
|
|
||
|
45,241
|
|
|
41,804
|
|
||
Less: accumulated depreciation and amortization
|
(17,294
|
)
|
|
(18,669
|
)
|
||
Net property and equipment
|
$
|
27,947
|
|
|
$
|
23,135
|
|
Balance at March 31, 2013
|
$
|
—
|
|
Acquisition of Harris
|
4,409
|
|
|
Balance at March 31, 2014
|
$
|
4,409
|
|
|
March 31, 2013
|
|
March 31, 2014
|
||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
||||||||
Patents
|
$
|
2,358
|
|
|
$
|
(649
|
)
|
|
$
|
2,362
|
|
|
$
|
(784
|
)
|
Licenses
|
58
|
|
|
(58
|
)
|
|
58
|
|
|
(58
|
)
|
||||
Trade name and trademarks
|
—
|
|
|
—
|
|
|
1,942
|
|
|
—
|
|
||||
Customer relationships
|
—
|
|
|
—
|
|
|
3,600
|
|
|
(535
|
)
|
||||
Developed technology
|
—
|
|
|
—
|
|
|
900
|
|
|
(19
|
)
|
||||
Non-competition agreements
|
—
|
|
|
—
|
|
|
100
|
|
|
(15
|
)
|
||||
Total
|
$
|
2,416
|
|
|
$
|
(707
|
)
|
|
$
|
8,962
|
|
|
$
|
(1,411
|
)
|
Fiscal 2015
|
$
|
1,350
|
|
Fiscal 2016
|
1,220
|
|
|
Fiscal 2017
|
877
|
|
|
Fiscal 2018
|
602
|
|
|
Fiscal 2019
|
426
|
|
|
Thereafter
|
1,134
|
|
|
|
$
|
5,609
|
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Amortization included in cost of sales:
|
|
|
|
|
|
||||||
Patents
|
$
|
136
|
|
|
$
|
133
|
|
|
$
|
135
|
|
Total
|
$
|
136
|
|
|
$
|
133
|
|
|
$
|
135
|
|
|
|
|
|
|
|
||||||
Amortization included in operating expenses:
|
|
|
|
|
|
||||||
Customer relationships
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
535
|
|
Developed technology
|
—
|
|
|
—
|
|
|
19
|
|
|||
Non-competition agreements
|
—
|
|
|
—
|
|
|
15
|
|
|||
Total
|
—
|
|
|
—
|
|
|
569
|
|
|||
Total amortization
|
$
|
136
|
|
|
$
|
133
|
|
|
$
|
704
|
|
Fiscal 2015
|
$
|
955
|
|
Fiscal 2016
|
309
|
|
|
Fiscal 2017
|
9
|
|
|
Total gross financed receivable
|
1,273
|
|
|
Less: amount above to be collected during the next 12 months
|
(955
|
)
|
|
Less: amount representing interest
|
(107
|
)
|
|
Total net long-term receivable
|
$
|
211
|
|
|
March 31,
|
||||||
|
2013
|
|
2014
|
||||
Beginning of year
|
$
|
84
|
|
|
$
|
284
|
|
Provision to product cost of revenue
|
402
|
|
|
300
|
|
||
Charges
|
(202
|
)
|
|
(321
|
)
|
||
End of year
|
$
|
284
|
|
|
$
|
263
|
|
1.
|
persuasive evidence of an arrangement exists;
|
2.
|
delivery has occurred and title has passed to the customer;
|
3.
|
the sales price is fixed and determinable and no further obligation exists; and
|
4.
|
collectability is reasonably assured.
|
|
Fiscal Year Ended March 31,
|
|||||||
|
2012
|
|
2013
|
|
2014
|
|||
Weighted average expected term
|
5.7 years
|
|
|
5.5 years
|
|
|
4.1 years
|
|
Risk-free interest rate
|
1.5
|
%
|
|
0.8
|
%
|
|
0.8
|
%
|
Expected volatility
|
70.0
|
%
|
|
72.5 - 74.4%
|
|
|
73.3
|
%
|
Expected forfeiture rate
|
15.1
|
%
|
|
21.4
|
%
|
|
20.3
|
%
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss) (in thousands)
|
$
|
483
|
|
|
$
|
(10,399
|
)
|
|
$
|
(6,199
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding
|
22,953,037
|
|
|
20,996,625
|
|
|
20,987,964
|
|
|||
Weighted-average effect of assumed conversion of stock options and warrants
|
433,488
|
|
|
—
|
|
|
—
|
|
|||
Weighted-average common shares and share equivalents outstanding
|
23,386,525
|
|
|
20,996,625
|
|
|
20,987,964
|
|
|||
Net income (loss) per common share:
|
|
|
|
|
|
||||||
Basic
|
$
|
0.02
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.30
|
)
|
Diluted
|
$
|
0.02
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.30
|
)
|
|
March 31,
|
|||||||
|
2012
|
|
2013
|
|
2014
|
|||
Common stock options
|
3,697,633
|
|
|
3,312,523
|
|
|
2,716,317
|
|
Restricted shares
|
—
|
|
|
105,000
|
|
|
539,204
|
|
Common stock warrants
|
38,980
|
|
|
38,980
|
|
|
38,980
|
|
Total
|
3,736,613
|
|
|
3,456,503
|
|
|
3,294,501
|
|
|
Acquisition of Harris Pro Forma Results of Operations
|
||||
|
Fiscal Year Ended March 31,
|
||||
|
2013
|
|
2014
|
||
Revenue
|
102,198
|
|
|
92,868
|
|
Net loss available to common shareholders
|
(7,489
|
)
|
|
(9,111
|
)
|
Loss per share:
|
|
|
|
||
Basic
|
(0.36
|
)
|
|
(0.43
|
)
|
Diluted
|
(0.36
|
)
|
|
(0.43
|
)
|
|
March 31,
|
||||||
|
2013
|
|
2014
|
||||
Term note
|
$
|
263
|
|
|
$
|
—
|
|
Harris seller's note
|
—
|
|
|
2,624
|
|
||
Customer equipment finance notes payable
|
4,408
|
|
|
2,331
|
|
||
First mortgage note payable
|
694
|
|
|
607
|
|
||
Debenture payable
|
721
|
|
|
675
|
|
||
Other long-term debt
|
620
|
|
|
364
|
|
||
Total long-term debt
|
6,706
|
|
|
6,601
|
|
||
Less current maturities
|
(2,597
|
)
|
|
(3,450
|
)
|
||
Long-term debt, less current maturities
|
$
|
4,109
|
|
|
$
|
3,151
|
|
Fiscal 2015
|
$
|
3,450
|
|
Fiscal 2016
|
1,884
|
|
|
Fiscal 2017
|
733
|
|
|
Fiscal 2018
|
70
|
|
|
Fiscal 2019
|
59
|
|
|
Thereafter
|
405
|
|
|
|
$
|
6,601
|
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Current
|
$
|
520
|
|
|
$
|
(180
|
)
|
|
$
|
19
|
|
Deferred
|
(150
|
)
|
|
4,253
|
|
|
(2,077
|
)
|
|||
|
$
|
370
|
|
|
$
|
4,073
|
|
|
$
|
(2,058
|
)
|
|
|
|
|
|
|
||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Federal
|
$
|
292
|
|
|
$
|
3,803
|
|
|
$
|
(1,830
|
)
|
State
|
78
|
|
|
270
|
|
|
(228
|
)
|
|||
|
$
|
370
|
|
|
$
|
4,073
|
|
|
$
|
(2,058
|
)
|
|
Fiscal Year Ended March 31,
|
|||||||
|
2012
|
|
2013
|
|
2014
|
|||
Statutory federal tax rate
|
34.0
|
%
|
|
34.0
|
%
|
|
34.0
|
%
|
State taxes, net
|
9.2
|
%
|
|
2.3
|
%
|
|
2.8
|
%
|
Federal tax credit
|
(11.6
|
)%
|
|
3.9
|
%
|
|
0.9
|
%
|
State tax credit
|
(5.9
|
)%
|
|
(0.5
|
)%
|
|
0.4
|
%
|
Change in valuation reserve
|
5.9
|
%
|
|
(111.7
|
)%
|
|
(10.2
|
)%
|
Permanent items
|
10.0
|
%
|
|
2.3
|
%
|
|
(2.9
|
)%
|
Change in tax contingency reserve
|
0.8
|
%
|
|
3.4
|
%
|
|
(0.3
|
)%
|
Other, net
|
0.9
|
%
|
|
1.9
|
%
|
|
0.2
|
%
|
Effective income tax rate
|
43.3
|
%
|
|
(64.4
|
)%
|
|
24.9
|
%
|
|
March 31,
|
||||||
|
2013
|
|
2014
|
||||
Inventory, accruals and reserves
|
$
|
2,090
|
|
|
$
|
1,445
|
|
Other
|
136
|
|
|
139
|
|
||
Deferred revenue
|
338
|
|
|
44
|
|
||
Valuation allowance
|
(2,564
|
)
|
|
(1,628
|
)
|
||
Total net current deferred tax assets and liabilities
|
$
|
—
|
|
|
$
|
—
|
|
Federal and state operating loss carryforwards
|
2,691
|
|
|
6,233
|
|
||
Tax credit carryforwards
|
1,426
|
|
|
1,498
|
|
||
Non-qualified stock options
|
2,298
|
|
|
2,541
|
|
||
Deferred revenue
|
27
|
|
|
23
|
|
||
Fixed assets
|
(1,909
|
)
|
|
(1,889
|
)
|
||
Intangible assets
|
—
|
|
|
(2,125
|
)
|
||
Valuation allowance
|
(4,533
|
)
|
|
(6,281
|
)
|
||
Total net long-term deferred tax assets and liabilities
|
$
|
—
|
|
|
$
|
—
|
|
Total net deferred tax assets
|
$
|
—
|
|
|
$
|
—
|
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Unrecognized tax benefits as of beginning of fiscal year
|
$
|
399
|
|
|
$
|
406
|
|
|
$
|
188
|
|
Additions based on tax positions related to the current period positions
|
7
|
|
|
16
|
|
|
22
|
|
|||
Reduction for tax positions of prior years
|
—
|
|
|
(1
|
)
|
|
—
|
|
|||
Reduction due to lapse of statute of limitations
|
—
|
|
|
(233
|
)
|
|
—
|
|
|||
Unrecognized tax benefits as of end of fiscal year
|
$
|
406
|
|
|
$
|
188
|
|
|
$
|
210
|
|
Fiscal 2015
|
$
|
289
|
|
Fiscal 2016
|
206
|
|
|
Fiscal 2017
|
85
|
|
|
Fiscal 2018
|
71
|
|
|
Fiscal 2019
|
—
|
|
|
Thereafter
|
—
|
|
|
|
$
|
651
|
|
|
As of March 31, 2013
|
||||||||||||||
|
Shares Issued Under ESPP
Plan |
|
Closing Market
Price |
|
Shares Issued Under Loan
Program |
|
Dollar Value of
Loans Issued |
|
Repayment of
Loans |
||||||
Quarter Ended June 30, 2012
|
9,232
|
|
|
$2.20
|
|
7,955
|
|
|
$
|
17,500
|
|
|
$
|
1,600
|
|
Quarter Ended September 30, 2012
|
27,467
|
|
|
$1.98
|
|
25,606
|
|
|
50,700
|
|
|
4,060
|
|
||
Quarter Ended December 31, 2012
|
9,846
|
|
|
$1.66
|
|
8,434
|
|
|
14,000
|
|
|
1,075
|
|
||
Quarter Ended March 31, 2013
|
1,053
|
|
|
$2.48
|
|
—
|
|
|
—
|
|
|
30,830
|
|
||
Total
|
47,598
|
|
|
$1.66 - 2.48
|
|
41,995
|
|
|
$
|
82,200
|
|
|
$
|
37,565
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
As of March 31, 2014
|
||||||||||||||
|
Shares Issued Under ESPP
Plan |
|
Closing Market
Price |
|
Shares Issued Under Loan
Program |
|
Dollar Value of
Loans Issued |
|
Repayment of
Loans |
||||||
Quarter Ended June 30, 2013
|
990
|
|
|
$2.48
|
|
—
|
|
|
$
|
—
|
|
|
$
|
823
|
|
Quarter Ended September 30, 2013
|
702
|
|
|
$3.76
|
|
—
|
|
|
—
|
|
|
118,309
|
|
||
Quarter Ended December 31, 2013
|
319
|
|
|
$6.80
|
|
—
|
|
|
—
|
|
|
94,300
|
|
||
Quarter Ended March 31, 2014
|
362
|
|
|
$7.25
|
|
—
|
|
|
—
|
|
|
1,677
|
|
||
Total
|
2,373
|
|
|
$2.48 - 7.25
|
|
—
|
|
|
$
|
—
|
|
|
$
|
215,109
|
|
|
Fiscal Year Ended March 31,
|
||||||||||
|
2012
|
|
2013
|
|
2014
|
||||||
Cost of product revenue
|
$
|
189
|
|
|
$
|
114
|
|
|
$
|
70
|
|
General and administrative
|
548
|
|
|
578
|
|
|
1,025
|
|
|||
Sales and marketing
|
501
|
|
|
451
|
|
|
485
|
|
|||
Research and development
|
29
|
|
|
21
|
|
|
13
|
|
|||
|
$
|
1,267
|
|
|
$
|
1,164
|
|
|
$
|
1,593
|
|
Available at March 31, 2011
|
1,577,676
|
|
Granted stock options
|
(1,481,356
|
)
|
Granted shares
|
(29,308
|
)
|
Forfeited
|
1,339,078
|
|
Available at March 31, 2012
|
1,406,090
|
|
Granted stock options
|
(1,054,876
|
)
|
Granted shares
|
(33,422
|
)
|
Restricted Shares
|
(163,750
|
)
|
Forfeited restricted shares
|
58,750
|
|
Forfeited stock options
|
1,419,986
|
|
Available at March 31, 2013
|
1,632,778
|
|
Granted stock options
|
(305,544
|
)
|
Granted shares
|
(33,641
|
)
|
Restricted shares
|
(526,663
|
)
|
Forfeited restricted shares
|
69,375
|
|
Forfeited stock options
|
455,691
|
|
Available at March 31, 2014
|
1,291,996
|
|
|
Number of
Shares |
|
Weighted
Average Exercise Price |
|
Weighted
Average Fair Value of Options Granted |
|
Aggregate Intrinsic
Value |
|||||
Outstanding at March 31, 2011
|
3,658,768
|
|
|
$
|
3.83
|
|
|
2.04
|
|
|
||
Granted
|
1,481,356
|
|
|
$
|
3.56
|
|
|
|
|
|
||
Exercised
|
(103,413
|
)
|
|
$
|
1.45
|
|
|
|
|
|
||
Forfeited
|
(1,339,078
|
)
|
|
$
|
4.18
|
|
|
|
|
|
||
Outstanding at March 31, 2012
|
3,697,633
|
|
|
$
|
3.76
|
|
|
1.95
|
|
|
||
Granted
|
1,054,876
|
|
|
$
|
1.98
|
|
|
|
|
|
||
Exercised
|
(20,000
|
)
|
|
$
|
2.25
|
|
|
|
|
|
||
Forfeited
|
(1,419,986
|
)
|
|
$
|
3.26
|
|
|
|
|
|
||
Outstanding at March 31, 2013
|
3,312,523
|
|
|
$
|
3.42
|
|
|
1.23
|
|
|
||
Granted
|
305,544
|
|
|
$
|
2.41
|
|
|
|
|
|
||
Exercised
|
(446,059
|
)
|
|
$
|
2.58
|
|
|
|
|
|
||
Forfeited
|
(455,691
|
)
|
|
$
|
3.52
|
|
|
|
|
|
||
Outstanding at March 31, 2014
|
2,716,317
|
|
|
$
|
3.43
|
|
|
1.32
|
|
$
|
10,978,432
|
|
Exercisable at March 31, 2014
|
1,586,940
|
|
|
|
|
|
|
$
|
5,614,065
|
|
|
March 31, 2014
|
||||||||||
|
Outstanding
|
|
Weighted Average Remaining Contractual Life (Years)
|
|
Weighted Average Exercise Price
|
|
Vested
|
|
Weighted Average Exercise Price
|
||
$0.75
|
10,000
|
|
|
1.00
|
|
$0.75
|
|
10,000
|
|
|
$0.75
|
1.62 - 2.25
|
882,709
|
|
|
6.58
|
|
2.01
|
|
350,959
|
|
|
2.09
|
2.41 - 2.75
|
546,944
|
|
|
8.08
|
|
2.48
|
|
192,920
|
|
|
2.49
|
2.86 - 4.28
|
821,207
|
|
|
5.91
|
|
3.42
|
|
607,904
|
|
|
3.40
|
4.49 - 4.76
|
54,400
|
|
|
3.75
|
|
4.65
|
|
52,800
|
|
|
4.65
|
5.35 - 6.05
|
220,706
|
|
|
5.33
|
|
5.47
|
|
192,006
|
|
|
5.47
|
9.00
|
43,000
|
|
|
3.87
|
|
9.00
|
|
43,000
|
|
|
9.00
|
10.14 - 11.61
|
137,351
|
|
|
3.83
|
|
11.02
|
|
137,351
|
|
|
11.02
|
|
2,716,317
|
|
|
6.32
|
|
$3.43
|
|
1,586,940
|
|
|
$4.09
|
Fiscal 2015
|
$
|
1,098
|
|
Fiscal 2016
|
868
|
|
|
Fiscal 2017
|
519
|
|
|
Fiscal 2018
|
361
|
|
|
Fiscal 2019
|
134
|
|
|
Thereafter
|
7
|
|
|
|
$
|
2,987
|
|
Remaining weighted average expected term
|
5.1 years
|
|
Balance at March 31, 2013
|
105,000
|
|
|
Shares issued
|
526,663
|
|
|
Shares vested
|
(23,084
|
)
|
|
Shares forfeited
|
(69,375
|
)
|
|
Shares outstanding at March 31, 2014
|
539,204
|
|
|
Per share price on grant date
|
$1.80-6.97
|
|
|
Compensation expense
|
$
|
261,351
|
|
|
Number of
Shares |
|
Weighted
Average Exercise Price |
|||
Outstanding at March 31, 2011
|
38,980
|
|
|
$
|
2.25
|
|
Issued
|
—
|
|
|
—
|
|
|
Exercised
|
—
|
|
|
$
|
—
|
|
Cancelled
|
—
|
|
|
$
|
—
|
|
Outstanding at March 31, 2012
|
38,980
|
|
|
$
|
2.25
|
|
Issued
|
—
|
|
|
—
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Cancelled
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2013
|
38,980
|
|
|
$
|
2.25
|
|
Issued
|
—
|
|
|
—
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Cancelled
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2014
|
38,980
|
|
|
$
|
2.25
|
|
Exercise Price
|
Number of Shares
|
|
Expiration
|
$2.25
|
38,980
|
|
Fiscal 2015
|
|
Revenues
|
|
Operating (Loss) Profit
|
||||||||||||||||||||
|
For the year ended March 31,
|
|
For the year ended March 31,
|
||||||||||||||||||||
(dollars in thousands)
|
2012
|
|
2013
|
|
2014
|
|
2012
|
|
2013
|
|
2014
|
||||||||||||
Segments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Energy Management
|
$
|
72,097
|
|
|
$
|
67,437
|
|
|
$
|
66,793
|
|
|
$
|
4,974
|
|
|
$
|
245
|
|
|
$
|
(1,743
|
)
|
Engineered Systems
|
28,465
|
|
|
18,649
|
|
|
21,830
|
|
|
569
|
|
|
671
|
|
|
1,991
|
|
||||||
Corporate and Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,021
|
)
|
|
(7,520
|
)
|
|
(8,591
|
)
|
||||||
|
$
|
100,562
|
|
|
$
|
86,086
|
|
|
$
|
88,623
|
|
|
$
|
522
|
|
|
$
|
(6,604
|
)
|
|
$
|
(8,343
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Depreciation and Amortization
|
|
Capital Expenditures
|
||||||||||||||||||||
|
For the year ended March 31,
|
|
For the year ended March 31,
|
||||||||||||||||||||
(dollars in thousands)
|
2012
|
|
2013
|
|
2014
|
|
2012
|
|
2013
|
|
2014
|
||||||||||||
Segments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Energy Management
|
$
|
1,703
|
|
|
$
|
1,774
|
|
|
$
|
2,667
|
|
|
$
|
1,179
|
|
|
$
|
993
|
|
|
$
|
276
|
|
Engineered Systems
|
287
|
|
|
249
|
|
|
302
|
|
|
34
|
|
|
50
|
|
|
—
|
|
||||||
Corporate and Other
|
2,246
|
|
|
2,554
|
|
|
1,569
|
|
|
3,114
|
|
|
1,116
|
|
|
134
|
|
||||||
|
$
|
4,236
|
|
|
$
|
4,577
|
|
|
$
|
4,538
|
|
|
$
|
4,327
|
|
|
$
|
2,159
|
|
|
$
|
410
|
|
|
Total Assets
|
|
Deferred Revenue
|
||||||||||||
(dollars in thousands)
|
March 31, 2013
|
|
March 31, 2014
|
|
March 31, 2013
|
|
March 31, 2014
|
||||||||
Segments:
|
|
|
|
|
|
|
|
||||||||
Energy Management
|
$
|
58,627
|
|
|
$
|
57,118
|
|
|
$
|
564
|
|
|
$
|
276
|
|
Engineered Systems
|
9,339
|
|
|
7,742
|
|
|
3,640
|
|
|
1,654
|
|
||||
Corporate and Other
|
34,131
|
|
|
34,080
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
102,097
|
|
|
$
|
98,940
|
|
|
$
|
4,204
|
|
|
$
|
1,930
|
|
|
Three Months Ended
|
|
|
||||||||||||||||
|
Jun 30, 2012
|
|
Sep 30, 2012
|
|
Dec 31, 2012
|
|
Mar 31, 2013
|
|
Total
|
||||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||||||
Total revenue
|
$
|
15,310
|
|
|
$
|
19,408
|
|
|
$
|
29,087
|
|
|
$
|
22,281
|
|
|
$
|
86,086
|
|
Gross profit
|
$
|
4,373
|
|
|
$
|
5,805
|
|
|
$
|
8,581
|
|
|
$
|
7,971
|
|
|
$
|
26,730
|
|
Net income (loss)
|
$
|
(1,940
|
)
|
|
$
|
(9,659
|
)
|
|
$
|
651
|
|
|
$
|
549
|
|
|
$
|
(10,399
|
)
|
Basic net income per share
|
$
|
(0.09
|
)
|
|
$
|
(0.46
|
)
|
|
$
|
0.03
|
|
|
$
|
0.03
|
|
|
$
|
(0.50
|
)
|
Shares used in basic per share calculation
|
22,561
|
|
|
21,076
|
|
|
20,192
|
|
|
20,157
|
|
|
20,997
|
|
|||||
Diluted net income per share
|
$
|
(0.09
|
)
|
|
$
|
(0.46
|
)
|
|
$
|
0.03
|
|
|
$
|
0.03
|
|
|
$
|
(0.50
|
)
|
Shares used in diluted per share calculation
|
22,561
|
|
|
21,076
|
|
|
20,245
|
|
|
20,308
|
|
|
20,997
|
|
|
Three Months Ended
|
|
|
||||||||||||||||
|
Jun 30, 2013
|
|
Sep 30, 2013
|
|
Dec 31, 2013
|
|
Mar 31, 2014
|
|
Total
|
||||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||||||
Total revenue
|
$
|
20,852
|
|
|
$
|
27,495
|
|
|
$
|
27,692
|
|
|
$
|
12,584
|
|
|
$
|
88,623
|
|
Gross profit
|
$
|
5,723
|
|
|
$
|
7,829
|
|
|
$
|
8,150
|
|
|
$
|
1,278
|
|
|
$
|
22,980
|
|
Net income (loss)
|
$
|
(781
|
)
|
|
$
|
2,403
|
|
|
$
|
1,018
|
|
|
$
|
(8,839
|
)
|
|
$
|
(6,199
|
)
|
Basic net income per share
|
$
|
(0.04
|
)
|
|
$
|
0.11
|
|
|
$
|
0.05
|
|
|
$
|
(0.41
|
)
|
|
$
|
(0.30
|
)
|
Shares used in basic per share calculation
|
20,174
|
|
|
21,090
|
|
|
21,220
|
|
|
21,469
|
|
|
20,988
|
|
|||||
Diluted net income per share
|
$
|
(0.04
|
)
|
|
$
|
0.11
|
|
|
$
|
0.05
|
|
|
$
|
(0.41
|
)
|
|
$
|
(0.30
|
)
|
Shares used in diluted per share calculation
|
20,174
|
|
|
21,542
|
|
|
22,329
|
|
|
21,469
|
|
|
20,988
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
|
(a)
|
Financial Statements
|
(b)
|
Financial Statement Schedule
|
|
|
SCHEDULE II
VALUATION and QUALIFYING ACCOUNTS
|
||||||||||||||
|
|
Balance at
beginning of
period
|
|
Provisions
charged to
expense
|
|
Write offs
and other
|
|
Balance at
end of
period
|
||||||||
March 31,
|
|
(in Thousands)
|
||||||||||||||
2012
|
Allowance for Doubtful Accounts
|
$
|
757
|
|
|
$
|
566
|
|
|
$
|
376
|
|
|
$
|
947
|
|
2013
|
Allowance for Doubtful Accounts
|
947
|
|
|
757
|
|
|
804
|
|
|
900
|
|
||||
2014
|
Allowance for Doubtful Accounts
|
$
|
900
|
|
|
$
|
174
|
|
|
$
|
690
|
|
|
$
|
384
|
|
|
|
|
|
|
|
|
|
|
||||||||
2012
|
Inventory Obsolescence Reserve
|
$
|
1,338
|
|
|
$
|
167
|
|
|
$
|
5
|
|
|
$
|
1,500
|
|
2013
|
Inventory Obsolescence Reserve
|
1,500
|
|
|
859
|
|
|
58
|
|
|
2,301
|
|
||||
2014
|
Inventory Obsolescence Reserve
|
$
|
2,301
|
|
|
$
|
1,995
|
|
|
$
|
1,769
|
|
|
$
|
2,527
|
|
Number
|
|
Exhibit Title
|
|
|
|
||
2.1
|
|
|
Stock and Unit Purchase Agreement dated May 22, 2013 between Orion Energy Systems, Inc., Harris Manufacturing, Inc., Harris LED, LLC, and their respective shareholders and members filed as Exhibit 2.1 to the Registrant’s Form 8-K filed on July 2, 2013, is hereby incorporated by reference.
|
|
|
|
|
2.1(a)
|
|
|
Letter Agreement with respect to Stock and Unit Purchase Agreement dated May 22, 2013 between Orion Energy Systems, Inc., Harris Manufacturing, Inc., Harris LED, LLC their respective shareholders and members filed as Exhibit 2.1 to the Registrant’s Form 10-Q filed on November 8, 2013, is hereby incorporated by reference.
|
|
|
|
|
3.1
|
|
|
Amended and Restated Articles of Incorporation of Orion Energy Systems, Inc., filed as Exhibit 3.3 to the Registrant’s Form S-1 filed August 20, 2007, is hereby incorporated by reference.
|
|
|
||
3.2
|
|
|
Amended and Restated Bylaws of Orion Energy Systems, Inc., filed as Exhibit 3.2 to the Registrant’s Form 10-Q filed November 8, 2013, is hereby incorporated by reference.
|
|
|
||
4.1
|
|
|
Rights Agreement, dated as of January 7, 2009, between Orion Energy Systems, Inc. and Wells Fargo Bank, N.A., which includes as Exhibit A thereto the Form of Right Certificate and as Exhibit B thereto the Summary of Common Share Purchase Rights, filed as Exhibit 4.1 to the Registrant’s Form 8-A filed January 8, 2009, is hereby incorporated by reference.
|
|
|
||
10.1
|
|
|
Credit Agreement, dated June 30, 2010, by and among Orion Energy Systems, Inc., Orion Asset Management LLC, Clean Energy Solutions, LLC and JP Morgan Chase Bank, N.A., filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed July 2, 2010, is hereby incorporated by reference.
|
|
|
||
10.1(a)
|
|
|
First Amendment to Credit Agreement dated September 30, 2011 by and among Orion Energy Systems, Inc., Orion Asset Management LLC, Clean Energy Solutions, LLC and JP Morgan Chase Bank, N.A., filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed October 5, 2011, is hereby incorporated by reference.
|
|
|
|
|
10.1(b)
|
|
|
Second Amendment to Credit Agreement, dated June 25, 2012, by and among Orion Energy Systems, Inc., Orion Asset Management, LLC, Clean Energy Solutions, LLC, Great Lakes Energy Technologies, LLC and JPMorgan Chase Bank, N.A., filed as Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed June 26, 2012, is hereby incorporated by reference.
|
|
|
||
10.1(c)
|
|
|
Third Amendment to Credit Agreement, dated February 5, 2013, by and among Orion Energy Systems, Inc., Orion Asset Management, LLC, Clean Energy Solutions, LLC, Great Lakes Energy Technologies, LLC and JPMorgan Chase Bank, N.A., filed as Exhibit 10.1 to the Registrant's Current Report on Form 10-Q filed February 8, 2013, is hereby incorporated by reference.
|
|
|
|
|
10.1(d)
|
|
|
Fourth Amendment to Credit Agreement, dated June 28, 2013, by and among Orion Energy Systems, Inc., Orion Asset Management, LLC, Clean Energy Solutions, LLC, Great Lakes Energy Technologies, LLC and JPMorgan Chase Bank, N.A. filed as Exhibit 10.1 to the Registrant’s Form 8-K filed on July 2, 2013, is hereby incorporated by reference.
|
|
|
|
|
10.1(e)
|
|
|
Joinder and Fifth Amendment to Credit Agreement, dated August 30, 2013, by and among Orion Energy Systems, Inc., Orion Asset Management, LLC, Clean Energy Solutions, LLC, Great Lakes Energy Technologies, LLC, Harris Manufacturing, Inc., Harris LED, LLC, and JPMorgan Chase Bank, N.A. filed as Exhibit 10.1 to the Registrant’s Form 8-K filed on September 9, 2013, is hereby incorporated by reference.
|
|
|
|
|
10.2
|
|
|
Credit Agreement, dated September 30, 2011, by and among Orion Energy Systems, Inc., Orion Asset Management LLC, Clean Energy Solutions, LLC and JP Morgan Chase Bank, N.A., filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed October 5, 2011, is hereby incorporated by reference.
|
|
|
|
|
10.2(a)
|
|
|
First Amendment to Credit Agreement, dated February 5, 2013, by and among Orion Asset Management, LLC, Orion Energy Systems, Inc., Clean Energy Solutions, LLC, Great Lakes Energy Technologies, LLC and JP Morgan Chase Bank, N.A., filed as Exhibit 10.2 to the Registrant's Current Report on Form 10-Q filed February 8, 2013, is hereby incorporated by reference.
|
|
|
||
10.2(b)
|
|
|
Joinder and Second Amendment to Credit Agreement, dated August 30, 2013, by and among Orion Energy Systems, Inc., Orion Asset Management, LLC, Clean Energy Solutions, LLC, Great Lakes Energy Technologies, LLC, Harris Manufacturing, Inc., Harris LED, LLC, and JPMorgan Chase Bank, N.A. filed as Exhibit 10.2 to the Registrant’s Form 8-K filed on September 9, 2013, is hereby incorporated by reference.
|
|
|
|
|
10.3
|
|
|
Orion Energy Systems, Inc. 2003 Stock Option Plan, as amended, filed as Exhibit 10.6 to the Registrant’s Form S-1 filed August 20, 2007, is hereby incorporated by reference.*
|
|
|
||
10.4
|
|
|
Form of Stock Option Agreement under the Orion Energy Systems, Inc. 2003 Stock Option Plan, filed as Exhibit 10.7 to the Registrant’s Form S-1 filed August 20, 2007, is hereby incorporated by reference.*
|
|
|
10.5
|
|
|
Orion Energy Systems, Inc. 2004 Stock and Incentive Awards Plan, filed as Exhibit 10.9 to the Registrant’s Form S-1 filed August 20, 2007, is hereby incorporated by reference.*
|
|
|
||
10.5(a)
|
|
|
Amendment to Orion Energy Systems, Inc. 2004 Stock and Incentive Awards Plan, filed September 9, 2011 as Appendix A to the Registrant’s definitive proxy statement is hereby incorporated by reference.*
|
|
|
||
10.6
|
|
|
Form of Stock Option Agreement under the Orion Energy Systems, Inc. 2004 Equity Incentive Plan, filed as Exhibit 10.10 to the Registrant’s Form S-1 filed August 20, 2007, is hereby incorporated by reference.*
|
|
|
||
10.7
|
|
|
Form of Stock Option Agreement as of May 14, 2013 under the Orion Energy Systems, Inc. 2004 Stock and Incentive Awards Plan, filed as Exhibit 10.7 to the Registrant’s Form 10-K filed on June 14, 2014, is hereby incorporated by reference.*
|
|
|
||
10.8
|
|
|
Form of Restricted Stock Award Agreement as of May 14, 2013 under the Orion Energy Systems, Inc. 2004 Stock and Incentive Awards Plan, filed as Exhibit 10.8 to the Registrant’s Form 10-K filed on June 14, 2014, is hereby incorporated by reference.*
|
|
|
|
|
10.9
|
|
|
Summary of Non-Employee Director Compensation for fiscal 2015.*
+
|
|
|
||
10.10
|
|
|
Executive Employment and Severance Agreement, dated February 21, 2008, by and between Orion Energy Systems, Inc. and Michael J. Potts, filed as Exhibit 10.2 to the Registrant’s Form 8-K filed February 22, 2008, is hereby incorporated by reference.*
|
|
|
|
|
10.11
|
|
|
Executive Employment and Severance Agreement, dated as of September 27, 2012, by and between Orion Energy Systems, Inc. and John H. Scribante, filed as Exhibit 10.10 to the Registrant's Form 8-K filed September 28, 2012, is hereby incorporated by reference.*
|
|
|
||
10.12
|
|
|
Executive Employment and Severance Agreement, effective November 9, 2012 between the Company and Scott R. Jensen, filed as Exhibit 10.13 to the Registrant's Form 10-Q filed November 9, 2012, is hereby incorporated by reference.*
|
|
|
||
10.13
|
|
|
Letter Agreement effective December 1, 2012 between the Company and John H. Scribante, filed as Exhibit 10.15 to the Company's Form 8-K filed on December 6, 2012, is hereby incorporated by reference.*
|
|
|
|
|
10.14
|
|
|
Letter Agreement effective December 1, 2012 between the Company and Michael J. Potts, filed as Exhibit 10.16 to the Company's Form 8-K filed on December 6, 2012, is hereby incorporated by reference.*
|
|
|
|
|
10.15
|
|
|
Letter Agreement effective December 1, 2012 between the Company and Scott R. Jensen, filed as Exhibit 10.17 to the Company's Form 8-K filed on December 6, 2012, is hereby incorporated by reference.*
|
|
|
|
|
10.16
|
|
|
Executive Employment and Severance Agreement, dated as of January 1, 2014, by and between Orion Energy Systems, Inc. and Marc Meade filed as Exhibit 10.1 to the Registrant’s Form 8-K filed on January 6, 2014, is hereby incorporated by reference.*
|
|
|
|
|
10.17
|
|
|
Form of Executive Restricted Stock Award Agreement as of May 14, 2014 under the Orion Energy Systems, Inc. 2004 Stock and Inventive Awards Plan.*+
|
|
|
|
|
10.18
|
|
|
Form of Non-Employee Director Restricted Stock Award Agreement as of May 14, 2014 under the Orion Energy Systems, Inc. 2004 Stock and Inventive Awards Plan.*+
|
|
|
||
21.1
|
|
|
Subsidiaries of Orion Energy Systems, Inc.+
|
|
|
||
23.1
|
|
|
Consent of Independent Registered Public Accounting Firm. +
|
|
|
||
31.1
|
|
|
Certification of Chief Executive Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended. +
|
|
|
||
31.2
|
|
|
Certification of Chief Financial Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended. +
|
|
|
||
32.1
|
|
|
Certification of Chief Executive Officer and Chief Financial Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. +
|
|
|
||
101
|
|
|
101.INS XBRL Instance Document+
|
|
|
||
|
|
101.SCH Taxonomy extension schema document
|
|
|
|
||
|
|
101.CAL Taxonomy extension calculation linkbase document
|
|
|
|
||
|
|
101.LAB Taxonomy extension label linkbase document
|
|
|
|
||
|
|
101.PRE Taxonomy extension presentation linkbase document
|
Documents incorporated by reference by Orion Energy Systems, Inc. are filed with the Securities and Exchange Commission under File No. 001-33887.
|
*
|
Management contract or compensatory plan or arrangement required to be filed (and/or incorporated by reference) as an exhibit to this Annual Report on Form 10-K pursuant to Item 15(a)(3) of Form 10-K.
|
+
|
Filed herewith
|
ORION ENERGY SYSTEMS, INC.
|
||
By:
|
|
/s/ JOHN H. SCRIBANTE
|
|
|
John H. Scribante
Chief Executive Officer
|
Signature
|
|
Title
|
|
|
|
/s/ John H. Scribante
|
|
Chief Executive Officer and Director (Principal
|
John H. Scribante
|
|
Executive Officer)
|
|
|
|
/s/ Scott R. Jensen
|
|
Chief Financial Officer, Chief Accounting Officer and
|
Scott R. Jensen
|
|
Treasurer (Principal Financial Officer)
|
|
|
|
/s/ James R. Kackley
|
|
Chairman of the Board
|
James R. Kackley
|
|
|
|
|
|
/s/ Michael W. Altschaefl
|
|
Director
|
Michael W. Altschaefl
|
|
|
|
|
|
/s/ Kenneth L. Goodson, Jr.
|
|
Director
|
Kenneth L. Goodson, Jr.
|
|
|
|
|
|
/s/ James D. Leslie
|
|
Director
|
James D. Leslie
|
|
|
|
|
|
/s/ Elizabeth Gamsky Rich
|
|
Director
|
Elizabeth Gamsky Rich
|
|
|
|
|
|
/s/ Thomas N. Schueller
|
|
Director
|
Thomas N. Schueller
|
|
|
|
|
|
/s/ Mark C. Williamson
|
|
Director
|
Mark C. Williamson
|
|
Grant Date:
|
May [
], 2013
|
Type of Option:
|
Nonqualified Stock Option
|
Number of Option Shares:
|
[
]
([
]
)
|
Exercise Price per Share:
|
U.S. $____._____
|
Vesting:
|
Thirty-three and one-third percent (33-1/3%) of your Option will vest and become exercisable on each of December 31, 2013, December 31, 2014 and December 31, 2015, provided you remain in employment or service during such period. Upon your termination of employment from, or cessation of services to, the Company and its Affiliates, the unvested portion of your Option will immediately terminate.
|
Termination Date:
|
Your Option expires at, and cannot be exercised after, the close of business at the Company’s headquarters on the earliest to occur of:
• The tenth (10th) anniversary of the Grant Date;
•
One year after your termination of your director service as a result of death or disability (within the meaning of Code Section 22(e)(3)); or
•
90 days after your termination of your director service for any other reason, provided that if you die during this 90 day period, the exercise period will be extended until one year after the date of your death.
If the date this Option terminates as specified above falls on a day on which the stock market is not open for trading or on a date that you are prohibited by Company policy (such as an insider trading policy) from exercising the Option, the termination date shall be automatically extended to the first available trading day following the original termination date, but not beyond the tenth (10
th
) anniversary of the Grant Date.
Notwithstanding the above, your entire Option is terminated immediately if your directorship is terminated for Cause (as defined below), or if your director service is otherwise terminated at a time when you could be terminated for Cause, or you voluntarily terminate without the Company’s prior consent.
For purposes of this Agreement, “Cause” means any of the following: (i) failure to perform or observe any of the terms or provisions of any written employment agreement with the Company or an Affiliate, or if no written employment agreement exists, the gross dereliction of your employment duties; (ii) failure to comply fully with the lawful directives of the Board of Directors of the Company; (iii) dishonesty; (iv) misconduct; (v) conviction of a crime involving moral turpitude; (vi) substance abuse; (vii) misappropriation of funds: (viii) disloyalty or disparagement of the Company, and of its Affiliates, or any of their management or employees; or (ix) other proper cause determined in good faith by the Committee.
|
Manner of Exercise:
|
You may exercise your Option only to the extent vested and only if it has not terminated. To exercise your Option, you must complete the “Notice of Stock Option Exercise” form provided by the Company and return it to the address indicated on the form. The form will be effective when it is received by the Company, but exercise will not be completed until you pay the total exercise price and all applicable withholding taxes due as a result of the exercise to the Company.
If someone else wants to exercise your Option after your death, that person must contact the Company and prove to the Company’s satisfaction that he or she is entitled to do so.
Your ability to exercise your Option may be restricted by the Company if required by applicable law.
|
Restrictions on Resale:
|
By accepting your Option, you agree not to sell any Shares acquired under your Option at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale.
|
Restrictions on Transfer:
|
During your lifetime, this Option is only exercisable by you. You may not transfer, pledge or assign this Option, by operation of law or otherwise, except pursuant to your will or the laws of descent and distribution. If you attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this Option, except as provided above, or in the event this Option is subject to levy or attachment, execution or similar process, the Company may terminate this Option by providing written notice to you.
|
Rescission of Exercise; Disgorgement of Option Gains:
|
If you are terminated for Cause, or if you are not terminated for Cause but the Committee later determines that you could have been terminated for Cause if all facts had been known at that time, or if the Committee determines that, after your termination of your directorship, you have violated the provisions of any non-competition, non-solicitation, confidentiality or assignment of inventions agreement then in effect, then your Option will terminate immediately on the date of such termination or determination, as applicable, and the Committee may, in its sole and absolute discretion, (i) rescind any notice of exercise submitted by you for which payment or the issuance of Shares has not been completed, in which event any exercise price you have tendered will be promptly returned to you or retained by the Company as an offset as provided below, and/or (ii) notify you in writing within two (2) years after exercise of all or any portion of the Option that any exercise made within the one (1) year period prior to your termination or prior to your breach of any non-competition, non-solicitation, confidentiality or assignment of inventions agreement, is rescinded. Within ten (10) days after receiving such notice from the Company, you shall pay to the Company the amount of any cash payment received, or the value of any other gain realized, as a result of the rescinded exercise. Notwithstanding the foregoing, the Company shall have the right to retain (as an offset against any amounts due hereunder), the exercise price and withholding amount tendered by you with respect to any rescinded exercise, and the Company shall have the right to offset against any other amounts due from the Company to you the amount owed by you hereunder.
|
Miscellaneous:
|
•
As a condition of the granting of your Option, you agree, for yourself and your legal representatives or guardians, that this Stock Option Award shall be interpreted by the Committee and that any interpretation by the Committee of the terms of this Stock Option Award or the Plan and any determination made by the Committee pursuant to this Stock Option Award or the Plan shall be final, binding and conclusive. Notwithstanding the foregoing, this Stock Option Award may not be amended, and the Company may not take any other action the effect of which is, to reduce the Exercise Price per Share other than (i) pursuant to Section 6.4 of the Plan, and in accordance with Section 1.409A-1(b)(5)(v)(B)
of the Treasury Regulations, or (ii) in connection with a transaction which is considered the grant of a new option for purposes of Section 409A of the Code, provided that the new Exercise Price per Share is not less than Fair Market Value of a Share on the new grant date.
•
As a condition of the granting of your Option, except as required by law, you agree not to disclose information regarding the existence, terms, or conditions of this Option to any person or entity whatsoever, including without limitation any members of the media (including, but not limited to, print journalists, newspapers, radio, television, cable, satellite programs, or Internet media) or any Internet web page or “chat room,” or any other entity or person, with the exception of your spouse, accountant, tax advisor, and/or attorneys. Any violation of this provision may result in immediate and complete forfeiture of all rights granted under this Option if so determined by the Committee.
•
As a condition of the granting of your Option, you acknowledge and agree that this Stock Option Award and the Plan constitute the entire agreement of the parties with respect to the subject matter of this Stock Option Award and the Plan. This Stock Option Award and the Plan supersede any and all other agreements or representations, both verbal and written, between the parties to this Stock Option Award with respect to options to purchase Common Stock or any other security of the Company.
•
This Stock Option Award may be executed in counterparts.
|
|
|
|
John H. Scribante, CEO
|
|
[Name], Optionee
|
Grantee:
|
|
Grant Date:
|
|
No. of Restricted Shares:
|
|
1.
|
Award of Restricted Stock
|
2.
|
Restrictions
|
3.
|
Stock; Dividends; Voting
|
4.
|
No Right to Continued Employment or Additional Grants
|
5.
|
Taxes and Withholding
|
6.
|
Grantee Bound by the Plan
|
7.
|
Modification of Agreement
|
8.
|
Severability
|
9.
|
Governing Law
|
10.
|
Successors in Interest
|
11.
|
Resolution of Disputes
|
12.
|
Pronouns; Including
|
|
|
|
|
|
|
|
Grantee
|
By:
|
|
|
|
Title:
|
|
|
|
1. Annual cash retainer:
|
$40,000 (cash or stock) ($10,000 paid quarterly)
|
2. Board meeting fee:
|
None
|
3. Committee meeting fee:
|
None
|
4. Annual restricted stock grant:
|
$45,000 grant date fair market value
2
|
5. Annual Chairman retainer:
|
$40,000 (cash or stock)
1
|
6. Annual Ad Hoc Litigation Committee Chair retainer:
|
$20,000 (cash or stock)
1
|
7. Annual Audit Committee Chairman retainer:
|
$30,000 (cash or stock)
1
|
8. Annual Compensation Committee Chair retainer:
|
$20,000 (cash or stock)
1
|
9. Annual Governance Committee Chair retainer:
|
$10,000 (cash or stock)
1
|
10. Reimburse out-of-pocket expenses:
|
Yes
|
1.
|
Tandem Award of Restricted Stock and Restricted Cash
|
2.
|
Restrictions
|
3.
|
Stock; Dividends; Voting; Interest
|
4.
|
No Right to Continued Employment or Additional Grants
|
5.
|
Taxes and Withholding
|
6.
|
Grantee Bound by the Plan
|
7.
|
Modification of Agreement
|
8.
|
Severability
|
9.
|
Governing Law
|
10.
|
Successors in Interest
|
11.
|
Resolution of Disputes
|
12.
|
Pronouns; Including
|
|
|
|
|
|
|
|
Grantee
|
|
|
1.
|
Award of Restricted Stock
|
2.
|
Restrictions
|
3.
|
Stock; Dividends; Voting
|
4.
|
No Right to Continued Service or Additional Grants
|
5.
|
Taxes and Withholding
|
6.
|
Grantee Bound by the Plan
|
7.
|
Modification of Agreement
|
8.
|
Severability
|
9.
|
Governing Law
|
10.
|
Successors in Interest
|
11.
|
Resolution of Disputes
|
12.
|
Pronouns; Including
|
|
|
|
|
|
|
|
Grantee
|
|
|
Entity
|
|
Jurisdiction of Organization
|
Great Lakes Energy Technologies, LLC
|
|
Wisconsin
|
Clean Energy Solutions, LLC
|
|
Wisconsin
|
Orion Asset Management, LLC
|
|
Wisconsin
|
Harris Manufacturing, Inc.
|
|
Florida
|
Harris LED, LLC
|
|
Florida
|
/s/ BDO USA, LLP
|
Milwaukee, Wisconsin
|
June 13, 2014
|
1.
|
I have reviewed this Annual Report on Form 10-K of Orion Energy Systems, 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;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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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:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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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
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of 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
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b.
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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.
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/s/ John H. Scribante
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John H. Scribante
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Chief Executive Officer
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1.
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I have reviewed this Annual Report on Form 10-K of Orion Energy Systems, Inc.;
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2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
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.
|
/s/ Scott R. Jensen
|
Scott R. Jensen
|
Chief Financial Officer, Chief Accounting Officer and Treasurer
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/s/ John H. Scribante
|
|
John H. Scribante
|
|
Chief Executive Officer
|
|
|
|
/s/ Scott R. Jensen
|
|
Scott R. Jensen
|
|
Chief Financial Officer,
|
|
Chief Accounting Officer and Treasurer
|
|
|
|
Date:
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June 13, 2014
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