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These measures include: · Fiscal year 2011 net income available to common stockholders per diluted common share excluding bargain purchase gain, net of transaction expenses related to the December 2010 FDIC-assisted acquisition involving the former First Southern Bank (the “Acquisition”), net of tax; · Fiscal year 2011 noninterest income excluding bargain purchase gain related to the Acquisition; · Fiscal year 2012 and 2011 net income available to common stockholders excluding accretion of fair value discount on acquired loans, amortization of fair value premium on assumed time deposits, and bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax; · Fiscal year 2012 and 2011 return on average assets excluding accretion of fair value discount on acquired loans, amortization of fair value premium on assumed time deposits, and bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax; · Fiscal year 2012 and 2011 return on average common equity excluding accretion of fair value discount on acquired loans, amortization of fair value premium on assumed time deposits, and bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax; · Fiscal year 2012 and 2011 net interest margin excluding accretion of fair value discount on acquired loans and amortization of fair value premium on assumed time deposits related to the Acquisition; Management believes that showing these amounts and measures excluding these items is useful for investors because it better reflects our core operating results and provides useful information by which to evaluate the Company’s operating performance on an ongoing basis from period to period. |
The following table presents a reconciliation of the calculation of fiscal 2011 diluted earnings per share available to common shareholders excluding bargain purchase gain and transaction expenses related to the Acquisition: For the twelve months ended June 30, 2011 Diluted earnings per share available to common stockholders $ 5.12 Less: impact of excluding bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax 1.92 Diluted earnings per share available to common stockholders - excluding bargain purchase gain, net of tax and transaction expenses, related to the Acquisition $ 3.20 The following table presents a reconciliation of the calculation of fiscal 2011 noninterest income excluding bargain purchase gain related to the Acquisition: The following table presents a reconciliation of the calculation of net income available to common stockholders, excluding accretion of fair value discount on acquired loans, amortization of premium on acquired time deposits, and bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax: The following table presents a reconciliation of the calculation of return on average assets, excluding accretion of fair value discount on acquired loans, amortization of premium on acquired time deposits, and bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax: The following table presents a reconciliation of the calculation of return on average common equity, excluding accretion of fair value discount on acquired loans, amortization of premium on acquired time deposits, and bargain purchase gain, net of transaction expenses, related to the Acquisition, net of tax: The following table presents a reconciliation of the calculation of net interest margin, excluding accretion of fair value discount on acquired loans and amortization of premium on acquired time deposits related to the Acquisition: The non-GAAP disclosures contained herein should not be viewed as substitutes for the results determined to be in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. |
By: /s/ Samuel H. Smith Samuel H. Smith Chairman of the Board of Directors September 21, 2012 By: /s/ Greg A. Steffens Greg A. Steffens President and Chief Executive Officer (Principal Executive Officer) September 21, 2012 By: /s/ L. Douglas Bagby L. Douglas Bagby Vice Chairman and Director September 21, 2012 By: /s/ Ronnie D. Black Ronnie D. Black Secretary and Director September 21, 2012 By: /s/ Sammy A. Schalk Sammy A. Schalk Director September 21, 2012 By: /s/ Rebecca McLane Brooks Rebecca McLane Brooks Director September 21, 2012 By: /s/ Charles R. Love Charles R. Love Director September 21, 2012 By: /s/ Charles R. Moffitt Charles R. Moffitt Director September 21, 2012 By: /s/ Dennis C. Robison Dennis C. Robison Director September 21, 2012 By: /s/ David J. Tooley David J. Tooley Director September 21, 2012 By: /s/ Matthew T. Funke Matthew T. Funke Chief Financial Officer (Principal Financial and Accounting Officer) September 21, 2012 Index to Exhibits Regulation S-K Exhibit Number Document 10.1 Named Executive Officer Salary and Bonus Agreement for fiscal 2013 10.2 Director Fee Arrangements Statement Regarding Computation of Per Share Earnings Subsidiaries of the Registrant Consent of Auditors Rule 13a-14(a)/15d-14(a) Certifications Section 1350 Certifications |
The important factors we discuss below, as well as other factors discussed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and identified in our filings with the SEC and those presented elsewhere by our management from time to time, could cause actual results to differ materially from those indicated by the forward-looking statements made in this document: · the strength of the United States economy in general and the strength of the local economies in which we conduct operations; · fluctuations in interest rates and in real estate values; · monetary and fiscal policies of the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”) and the U.S. Government and other governmental initiatives affecting the financial services industry; · the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; · our ability to access cost-effective funding; · the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; · expected cost savings, synergies and other benefits from the Company’s merger and acquisition activities might not be realized within the anticipated time frames or at all, and costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected; · fluctuations in real estate values and both residential and commercial real estate market conditions; · demand for loans and deposits in our market area; · legislative or regulatory changes that adversely affect our business; · results of examinations of us by our regulators, including the possibility that our regulators may, among other things, require us to increase our reserve for loan losses or to write-down assets; · the impact of technological changes; and · our success at managing the risks involved in the foregoing The Company disclaims any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information, or otherwise. |
Under the regulations, an institution shall be deemed to be (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier I risk-based capital ratio of 6.0% or more, has a leverage ratio of 5.0% or more and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, has a Tier I risk-based capital ratio of 4.0% or more, has a leverage ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of "well capitalized;" (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, has a Tier I risk-based capital ratio that is less than 4.0% or has a leverage ratio that is less than 4.0% (3.0% under certain circumstances); (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0%, has a Tier I risk-based capital ratio that is less than 3.0% or has a leverage ratio that is less than 3.0%; and (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%. |
The guidance instructs institutions to ensure that loan terms and underwriting standards are consistent with prudent lending practices, including consideration of a borrower's ability to repay the debt by final maturity at the fully indexed rate and assuming a fully amortizing repayment schedule; requires institutions to recognize, for higher risk loans, the necessity of verifying the borrower's income, assets and liabilities; requires institutions to address the risks associated with simultaneous second-lien loans, introductory interest rates, lending to subprime borrowers, non-owner-occupied investor loans, and reduced documentation loans; requires institutions to recognize that nontraditional mortgages, particularly those with risk-layering features, are untested in a stressed environment; requires institutions to recognize that nontraditional mortgage products warrant strong controls and risk management standards, capital levels commensurate with that risk, and allowances for loan and lease losses that reflect the collectibility of the portfolio; and ensure that consumers have sufficient information to clearly understand loan terms and associated risks prior to making product and payment choices. |
The FDIA provides that the appropriate federal regulatory agency must require an insured depository institution that is significantly undercapitalized or is undercapitalized and either fails to submit an acceptable capital restoration plan within the time period allowed or fails in any material respect to implement a capital restoration plan accepted by the appropriate federal banking agency to take one or more of the following actions: (i) sell enough shares, including voting shares, to become adequately capitalized; (ii) merge with (or be sold to) another institution (or holding company), but only if grounds exist for appointing a conservator or receiver; (iii) restrict certain transactions with banking affiliates as if the "sister bank" requirements of Section 23A of the Federal Reserve Act ("FRA") did not exist; (iv) otherwise restrict transactions with bank or non-bank affiliates; (v) restrict interest rates that the institution pays on deposits to "prevailing rates" in the institution's region; (vi) restrict asset growth or reduce total assets; (vii) alter, reduce or terminate activities; (viii) hold a new election of directors; (ix) dismiss any director or senior executive officer who held office for more than 180 days immediately before the institution became undercapitalized; (x) employ "qualified" senior executive officers; (xi) cease accepting deposits from correspondent depository institutions; (xii) divest certain non-depository affiliates which pose a danger to the institution; (xiii) be divested by a parent holding company; and (xiv) take any other action which the agency determines would better carry out the purposes of the Prompt Corrective Action provisions. |
By: /s/ Samuel H. Smith Samuel H. Smith Chairman of the Board of Directors September 21, 2011 By: /s/ Greg A. Steffens Greg A. Steffens President (Principal Executive Officer) September 21, 2011 By: /s/ Sammy A. Schalk Sammy A. Schalk Vice Chairman and Director September 21, 2011 By: /s/ Ronnie D. Black Ronnie D. Black Secretary and Director September 21, 2011 By: /s/ L. Douglas Bagby L. Douglas Bagby Director September 21, 2011 By: /s/ Rebecca McLane Brooks Rebecca McLane Brooks Director September 21, 2011 By: /s/ Charles R. Love Charles R. Love Director September 21, 2011 By: /s/ Charles R. Moffitt Charles R. Moffitt Director September 21, 2011 By: /s/ Dennis C. Robison Dennis C. Robison Director September 21, 2011 By: /s/ Matthew T. Funke Matthew T. Funke Chief Financial Officer (Principal Financial and Accounting Officer) September 21, 2011 Index to Exhibits Regulation S-K Exhibit Number Document 10.1 Named Executive Officer Salary and Bonus Agreement for 2010 10.2 Director Fee Arrangements Statement Regarding Computation of Per Share Earnings 2011 Annual Report to Stockholders Code of Conduct and Ethics Subsidiaries of the Registrant 23.1 Consent of Auditors 23.2 Consent of Auditors Rule 13a-14(a)/15d-14(a) Certifications Section 1350 Certifications 31 C.F.R. |
The important factors we discuss below, as well as other factors discussed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and identified in our filings with the SEC and those presented elsewhere by our management from time to time, could cause actual results to differ materially from those indicated by the forward-looking statements made in this document: · the strength of the United States economy in general and the strength of the local economies in which we conduct operations; · the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; · inflation, interest rate, market and monetary fluctuations; · the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; · the willingness of users to substitute our products and services for products and services of our competitors; · the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); · the impact of technological changes; · acquisitions; · changes in consumer spending and saving habits; and · our success at managing the risks involved in the foregoing. |
Under the regulations, an institution shall be deemed to be (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier I risk-based capital ratio of 6.0% or more, has a leverage ratio of 5.0% or more and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, has a Tier I risk-based capital ratio of 4.0% or more, has a leverage ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of "well capitalized;" (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, has a Tier I risk-based capital ratio that is less than 4.0% or has a leverage ratio that is less than 4.0% (3.0% under certain circumstances); (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0%, has a Tier I risk-based capital ratio that is less than 3.0% or has a leverage ratio that is less than 3.0%; and (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%. |
The guidance instructs institutions to ensure that loan terms and underwriting standards are consistent with prudent lending practices, including consideration of a borrower's ability to repay the debt by final maturity at the fully indexed rate and assuming a fully amortizing repayment schedule; requires institutions to recognize, for higher risk loans, the necessity of verifying the borrower's income, assets and liabilities; requires institutions to address the risks associated with simultaneous second-lien loans, introductory interest rates, lending to subprime borrowers, non-owner-occupied investor loans, and reduced documentation loans; requires institutions to recognize that nontraditional mortgages, particularly those with risk-layering features, are untested in a stressed environment; requires institutions to recognize that nontraditional mortgage products warrant strong controls and risk management standards, capital levels commensurate with that risk, and allowances for loan and lease losses that reflect the collectibility of the portfolio; and ensure that consumers have sufficient information to clearly understand loan terms and associated risks prior to making product and payment choices. |
The FDIA provides that the appropriate federal regulatory agency must require an insured depository institution that is significantly undercapitalized or is undercapitalized and either fails to submit an acceptable capital restoration plan within the time period allowed or fails in any material respect to implement a capital restoration plan accepted by the appropriate federal banking agency to take one or more of the following actions: (i) sell enough shares, including voting shares, to become adequately capitalized; (ii) merge with (or be sold to) another institution (or holding company), but only if grounds exist for appointing a conservator or receiver; (iii) restrict certain transactions with banking affiliates as if the "sister bank" requirements of Section 23A of the Federal Reserve Act ("FRA") did not exist; (iv) otherwise restrict transactions with bank or non-bank affiliates; (v) restrict interest rates that the institution pays on deposits to "prevailing rates" in the institution's region; (vi) restrict asset growth or reduce total assets; (vii) alter, reduce or terminate activities; (viii) hold a new election of directors; (ix) dismiss any director or senior executive officer who held office for more than 180 days immediately before the institution became undercapitalized; (x) employ "qualified" senior executive officers; (xi) cease accepting deposits from correspondent depository institutions; (xii) divest certain non-depository affiliates which pose a danger to the institution; (xiii) be divested by a parent holding company; and (xiv) take any other action which the agency determines would better carry out the purposes of the Prompt Corrective Action provisions. |
By: /s/ Samuel H. Smith Samuel H. Smith Chairman of the Board of Directors September 17, 2010 By: /s/ Greg A. Steffens Greg A. Steffens President (Principal Executive and Financial and Accounting Officer) September 17, 2010 By: /s/ Sammy A. Schalk Sammy A. Schalk Vice Chairman and Director September 17, 2010 By: /s/ Ronnie D. Black Ronnie D. Black Secretary and Director September 17, 2010 By: /s/ L. Douglas Bagby L. Douglas Bagby Director September 17, 2010 By: /s/ Rebecca McLane Brooks Rebecca McLane Brooks Director September 17, 2010 By: /s/ Charles R. Love Charles R. Love Director September 17, 2010 By: /s/ Charles R. Moffitt Charles R. Moffitt Director September 17, 2010 By: /s/ Dennis C. Robison Dennis C. Robison Director September 17, 2010 Index to Exhibits Regulation S-K Exhibit Number Document 10.1 Named Executive Officer Salary and Bonus Agreement for 2010 10.2 Director Fee Arrangements Statement Regarding Computation of Per Share Earnings 2010 Annual Report to Stockholders Code of Conduct and Ethics Subsidiaries of the Registrant 23.1 Consent of Auditors 23.2 Consent of Auditors Rule 13a-14(a)/15d-14(a) Certifications Section 1350 Certifications 31 C.F.R. |
The important factors we discuss below, as well as other factors discussed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and identified in our filings with the SEC and those presented elsewhere by our management from time to time, could cause actual results to differ materially from those indicated by the forward-looking statements made in this document: · the strength of the United States economy in general and the strength of the local economies in which we conduct operations; · the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; · inflation, interest rate, market and monetary fluctuations; · the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; · the willingness of users to substitute our products and services for products and services of our competitors; · the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); · the impact of technological changes; · acquisitions; · changes in consumer spending and saving habits; and · our success at managing the risks involved in the foregoing. |
Under the regulations, an institution shall be deemed to be (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier I risk-based capital ratio of 6.0% or more, has a leverage ratio of 5.0% or more and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, has a Tier I risk-based capital ratio of 4.0% or more, has a leverage ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of "well capitalized;" (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, has a Tier I risk-based capital ratio that is less than 4.0% or has a leverage ratio that is less than 4.0% (3.0% under certain circumstances); (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0%, has a Tier I risk-based capital ratio that is less than 3.0% or has a leverage ratio that is less than 3.0%; and (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%. |
The guidance instructs institutions to ensure that loan terms and underwriting standards are consistent with prudent lending practices, including consideration of a borrower's ability to repay the debt by final maturity at the fully indexed rate and assuming a fully amortizing repayment schedule; requires institutions to recognize, for higher risk loans, the necessity of verifying the borrower's income, assets and liabilities; requires institutions to address the risks associated with simultaneous second-lien loans, introductory interest rates, lending to subprime borrowers, non-owner-occupied investor loans, and reduced documentation loans; requires institutions to recognize that nontraditional mortgages, particularly those with risk-layering features, are untested in a stressed environment; requires institutions to recognize that nontraditional mortgage products warrant strong controls and risk management standards, capital levels commensurate with that risk, and allowances for loan and lease losses that reflect the collectibility of the portfolio; and ensure that consumers have sufficient information to clearly understand loan terms and associated risks prior to making product and payment choices. |
The FDIA provides that the appropriate federal regulatory agency must require an insured depository institution that is significantly undercapitalized or is undercapitalized and either fails to submit an acceptable capital restoration plan within the time period allowed or fails in any material respect to implement a capital restoration plan accepted by the appropriate federal banking agency to take one or more of the following actions: (i) sell enough shares, including voting shares, to become adequately capitalized; (ii) merge with (or be sold to) another institution (or holding company), but only if grounds exist for appointing a conservator or receiver; (iii) restrict certain transactions with banking affiliates as if the "sister bank" requirements of Section 23A of the Federal Reserve Act ("FRA") did not exist; (iv) otherwise restrict transactions with bank or non-bank affiliates; (v) restrict interest rates that the institution pays on deposits to "prevailing rates" in the institution's region; (vi) restrict asset growth or reduce total assets; (vii) alter, reduce or terminate activities; (viii) hold a new election of directors; (ix) dismiss any director or senior executive officer who held office for more than 180 days immediately before the institution became undercapitalized; (x) employ "qualified" senior executive officers; (xi) cease accepting deposits from correspondent depository institutions; (xii) divest certain non-depository affiliates which pose a danger to the institution; (xiii) be divested by a parent holding company; and (xiv) take any other action which the agency determines would better carry out the purposes of the Prompt Corrective Action provisions. |
By: /s/ Samuel H. Smith Samuel H. Smith Chairman of the Board of Directors September 25, 2009 By: /s/ Greg A. Steffens Greg A. Steffens President (Principal Executive and Financial and Accounting Officer) September 25, 2009 By: /s/ Sammy A. Schalk Sammy A. Schalk Vice Chairman and Director September 25, 2009 By: /s/ Ronnie D. Black Ronnie D. Black Secretary and Director September 25, 2009 By: /s/ L. Douglas Bagby L. Douglas Bagby Director September 25, 2009 By: /s/ Rebecca McLane Brooks Rebecca McLane Brooks Director September 25, 2009 By: /s/ Charles R. Love Charles R. Love Director September 25, 2009 By: /s/ Charles R. Moffitt Charles R. Moffitt Director September 25, 2009 By: /s/ Dennis C. Robison Dennis C. Robison Director September 25, 2009 Index to Exhibits Regulation S-K Exhibit Number Document 10.1 Named Executive Officer Salary and Bonus Agreement for 2009 10.2 Director Fee Arrangements Statement Regarding Computation of Per Share Earnings 2009 Annual Report to Stockholders Subsidiaries of the Registrant 23.1 Consent of Auditors 23.2 Consent of Auditors Rule 13a-14(a)/15d-14(a) Certifications Section 1350 Certifications 31 C.F.R. |
The important factors we discuss below, as well as other factors discussed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and identified in our filings with the SEC and those presented elsewhere by our management from time to time, could cause actual results to differ materially from those indicated by the forward-looking statements made in this document: · the strength of the United States economy in general and the strength of the local economies in which we conduct operations; · the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; · inflation, interest rate, market and monetary fluctuations; · the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; · the willingness of users to substitute our products and services for products and services of our competitors; · the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); · the impact of technological changes; · acquisitions; · changes in consumer spending and saving habits; and · our success at managing the risks involved in the foregoing. |
Under the regulations, an institution shall be deemed to be (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier I risk-based capital ratio of 6.0% or more, has a leverage ratio of 5.0% or more and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, has a Tier I risk-based capital ratio of 4.0% or more, has a leverage ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of "well capitalized;" (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, has a Tier I risk-based capital ratio that is less than 4.0% or has a leverage ratio that is less than 4.0% (3.0% under certain circumstances); (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0%, has a Tier I risk-based capital ratio that is less than 3.0% or has a leverage ratio that is less than 3.0%; and (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%. |
The FDIA provides that the appropriate federal regulatory agency must require an insured depository institution that is significantly undercapitalized or is undercapitalized and either fails to submit an acceptable capital restoration plan within the time period allowed or fails in any material respect to implement a capital restoration plan accepted by the appropriate federal banking agency to take one or more of the following actions: (i) sell enough shares, including voting shares, to become adequately capitalized; (ii) merge with (or be sold to) another institution (or holding company), but only if grounds exist for appointing a conservator or receiver; (iii) restrict certain transactions with banking affiliates as if the "sister bank" requirements of Section 23A of the Federal Reserve Act ("FRA") did not exist; (iv) otherwise restrict transactions with bank or non-bank affiliates; (v) restrict interest rates that the institution pays on deposits to "prevailing rates" in the institution's region; (vi) restrict asset growth or reduce total assets; (vii) alter, reduce or terminate activities; (viii) hold a new election of directors; (ix) dismiss any director or senior executive officer who held office for more than 180 days immediately before the institution became undercapitalized; (x) employ "qualified" senior executive officers; (xi) cease accepting deposits from correspondent depository institutions; (xii) divest certain non-depository affiliates which pose a danger to the institution; (xiii) be divested by a parent holding company; and (xiv) take any other action which the agency determines would better carry out the purposes of the Prompt Corrective Action provisions. |
By: /s/ James W. Tatum September 29, 2008 James W. Tatum Chairman of the Board of Directors By: /s/ Greg A. Steffens September 29, 2008 Greg A. Steffens President (Principal Executive and Financial and Accounting Officer) By: /s/ Samuel H. Smith September 29, 2008 Samuel H. Smith Vice Chairman and Director By: /s/ Ronnie D. Black September 29, 2008 Ronnie D. Black Secretary and Director By: /s/ L. Douglas Bagby September 29, 2008 L. Douglas Bagby Director By: /s/ Sammy A. Schalk September 29, 2008 Sammy A. Schalk Director By: /s/ Rebecca McLane Brooks September 29, 2008 Rebecca McLane Brooks Director By: /s/ Charles R. Love September 29, 2008 Charles R. Love Director By: /s/ Charles R. Moffitt September 29, 2008 Charles R. Moffitt Director Index to Exhibits Regulation S-B Exhibit Number Document 10.1 Named Executive Officer Salary and Bonus Agreement for 2008 10.2 Director Fee Arrangements Statement Regarding Computation of Per Share Earnings Annual Report to Stockholders Subsidiaries of the Registrant Consent of Auditors Rule 13a-14(a)/15d-14(a) Certifications Section 1350 Certifications |
The important factors we discuss below, as well as other factors discussed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and identified in our filings with the SEC and those presented elsewhere by our management from time to time, could cause actual results to differ materially from those indicated by the forward-looking statements made in this document: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; inflation, interest rate, market and monetary fluctuations; the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; the willingness of users to substitute our products and services for products and services of our competitors; the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); the impact of technological changes; acquisitions; changes in consumer spending and saving habits; and our success at managing the risks involved in the foregoing. |
Next Page Weighted Average Interest Rate Term Category Minimum Amount Balance Percentage of Total Deposits (In thousands) 0.00% None Non-interest Bearing $ 100 $22,276 8.25% 1.48 None NOW Accounts 31,123 11.52 3.89 None Savings Accounts 78,908 29.23 1.44 None Money Market Deposit Accounts 1,000 7,212 2.67 Certificates of Deposit 5.15% 30-day 30-day Fixed-term/Fixed rate 1,000 0.04% 4.90 91-day Fixed-term/Fixed-rate 1,000 1,385 0.51 3.26 91-day IRA Fixed-term/Fixed-rate 1,000 0.62 4.54 5 month Fixed-term/Fixed-rate 1,000 0.25 4.86 6 month Fixed-term/Fixed-rate 1,000 4,055 1.50 4.72 6 month IRA Fixed-term/Fixed-rate 1,000 0.12 5.12 7 month Fixed-term/Fixed-rate 1,000 46,723 17.31 5.09 7 month IRA Fixed-term/Fixed-rate 1,000 4,749 1.76 5.05 9 month Fixed-term/Fixed-rate 1,000 4,138 1.53 4.92 9 month IRA Fixed-term/Fixed-rate 1,000 1,124 0.42 5.08 11 month Fixed-term/Fixed-rate 1,000 7,707 2.85 5.04 11 month IRA Fixed-term/Fixed-rate 1,000 1,514 0.56 5.15 12 month Fixed-term/Fixed-rate 1,000 27,640 10.23 5.12 12 month IRA Fixed-term/Fixed-rate 1,000 4,404 1.63 5.13 13 month Fixed-term/Fixed-rate 1,000 4,115 1.52 5.16 13 month IRA Fixed-term/Fixed-rate 1,000 0.04 4.26 15 month Fixed-term/Fixed-rate 1,000 2,227 0.82 4.45 15 month IRA Fixed-term/Fixed-rate 1,000 0.16 4.55 18 month Fixed-term/Fixed-rate 1,000 0.16 4.13 18 month IRA Fixed-term/Fixed-rate 1,000 0.08 4.17 24 month Fixed-term/Fixed-rate 1,000 2,120 0.78 3.90 24 month IRA Fixed-term/Fixed-rate 1,000 0.06 4.49 24 month IRA Fixed-term/Variable rate 1,000 0.12 3.70 25 month Fixed-term/Fixed-rate 1,000 0.08 3.70 25 month IRA Fixed-term/Fixed-rate 1,000 --- 3.46 29 month Fixed-term/Fixed-rate 1,000 --- 3.87 30 month Fixed-term/Fixed-rate 1,000 0.10 3.04 35 month Fixed-term/Fixed-rate 1,000 0.03 3.37 35 month IRA Fixed-term/Fixed-rate 1,000 0.04 3.76 36 month Fixed-term/Fixed-rate 1,000 2,292 0.85 3.86 36 month IRA Fixed-term/Fixed-rate 1,000 1,938 0.72 3.59 48 month Fixed-term/Fixed-rate 1,000 0.19 3.69 48 month IRA Fixed-term/Fixed-rate 1,000 0.04 4.53 55 month Fixed-term/Fixed-rate 1,000 1,173 0.43 4.64 55 month IRA Fixed-term/Fixed-rate 1,000 0.04 4.22 60 month Fixed-term/Fixed-rate 1,000 6,799 2.52 4.02 60 month IRA Fixed-term/Fixed-rate 1,000 1,997 0.74 4.00 84 month Fixed-term/Fixed-rate 1,000 0.03 3.96 96 month Fixed-term/Fixed-rate 1,000 --- $270,088 100.00% Next Page The following table indicates the amount of the Bank's jumbo certificates of deposit by time remaining until maturity as of June 30, 2007. |
Under the regulations, an institution shall be deemed to be (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier I risk-based capital ratio of 6.0% or more, has a leverage ratio of 5.0% or more and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, has a Tier I risk-based capital ratio of 4.0% or more, has a leverage ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of "well capitalized;" (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, has a Tier I risk-based capital ratio that is less than 4.0% or has a leverage ratio that is less than 4.0% (3.0% under certain circumstances); (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0%, has a Tier I risk-based capital ratio that is less than 3.0% or has a leverage ratio that is less than 3.0%; and (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%. |
The FDIA provides that the appropriate federal regulatory agency must require an insured depository institution that is significantly undercapitalized or is undercapitalized and either fails to submit an acceptable capital restoration plan within the time period allowed or fails in any material respect to implement a capital restoration plan accepted by the appropriate federal banking agency to take one or more of the following actions: (i) sell enough shares, including voting shares, to become adequately capitalized; (ii) merge with (or be sold to) another institution (or holding company), but only if grounds exist for appointing a conservator or receiver; (iii) restrict certain transactions with banking affiliates as if the "sister bank" requirements of Section 23A of the Federal Reserve Act ("FRA") did not exist; (iv) otherwise restrict transactions with bank or non-bank affiliates; (v) restrict interest rates that the institution pays on deposits to "prevailing rates" in the institution's region; (vi) restrict asset growth or reduce total assets; (vii) alter, reduce or terminate activities; (viii) hold a new election of directors; (ix) dismiss any director or senior executive officer who held office for more than 180 days immediately before the institution became undercapitalized; (x) employ "qualified" senior executive officers; (xi) cease accepting deposits from correspondent depository institutions; (xii) divest certain non-depository affiliates which pose a danger to the institution; (xiii) be divested by a parent holding company; and (xiv) take any other action which the agency determines would better carry out the purposes of the Prompt Corrective Action provisions. |
The important factors we discuss below, as well as other factors discussed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and identified in our filings with the SEC and those presented elsewhere by our management from time to time, could cause actual results to differ materially from those indicated by the forward-looking statements made in this document: further developments in the Company's ongoing review of and efforts to resolve the problem credit relationship described in this report, which could result in, among other things, further downgrades of aforementioned loans, additional provisions to the loan loss reserve and the incurrence of other material non-cash and cash charges; the strength of the United States economy in general and the strength of the local economies in which we conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; inflation, interest rate, market and monetary fluctuations; the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; the willingness of users to substitute our products and services for products and services of our competitors; the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); the impact of technological changes; acquisitions; changes in consumer spending and saving habits; and our success at managing the risks involved in the foregoing. |
Next Page Weighted Average Interest Rate Term Category Minimum Amount Balance Percentage of Total Deposits (In thousands) 0.00% None Non-interest Bearing $ 100 $ 18,710 7.25% 1.44 None NOW Accounts 31,037 12.03 3.73 None Savings Accounts 73,825 28.61 2.02 None Money Market Deposit Accounts 1,000 8,908 3.45 Certificates of Deposit 4.75% 30-day 30-day Fixed-term/Fixed rate 1,000 0.07% 4.77 91-day Fixed-term/Fixed-rate 1,000 0.19 3.21 91-day IRA Fixed-term/Fixed-rate 1,000 0.01 4.31 5 month Fixed-term/Fixed-rate 1,000 4,376 1.70 4.20 5 month IRA Fixed-term/Fixed-rate 1,000 0.07 4.24 6 month Fixed-term/Fixed-rate 1,000 9,180 3.56 3.30 6 month IRA Fixed-term/Fixed-rate 1,000 0.13 5.03 7 month Fixed-term/Fixed-rate 1,000 12,941 5.01 5.02 7 month IRA Fixed-term/Fixed-rate 1,000 1,317 0.51 4.06 9 month Fixed-term/Fixed-rate 1,000 9,286 3.60 3.90 9 month IRA Fixed-term/Fixed-rate 1,000 1,067 0.41 4.19 11 month Fixed-term/Fixed-rate 1,000 12,898 5.00 4.06 11 month IRA Fixed-term/Fixed-rate 1,000 2,820 1.09 3.90 12 month Fixed-term/Fixed-rate 1,000 15,282 5.92 3.58 12 month IRA Fixed-term/Fixed-rate 1,000 1,347 0.52 3.88 13 month Fixed-term/Fixed-rate 1,000 10,889 4.22 3.85 13 month IRA Fixed-term/Fixed-rate 1,000 0.15 3.58 15 month Fixed-term/Fixed-rate 1,000 7,363 2.85 3.51 15 month IRA Fixed-term/Fixed-rate 1,000 1,365 0.53 3.53 18 month Fixed-term/Fixed-rate 1,000 0.23 4.00 18 month IRA Fixed-term/Fixed-rate 1,000 0.21 3.20 24 month Fixed-term/Fixed-rate 1,000 2,409 0.93 2.87 24 month IRA Fixed-term/Fixed-rate 1,000 0.14 4.83 24 month IRA Fixed-term/Variable rate 1,000 0.12 3.01 25 month Fixed-term/Fixed-rate 1,000 2,341 0.91 2.98 25 month IRA Fixed-term/Fixed-rate 1,000 0.10 8.46 29 month Fixed-term/Fixed-rate 1,000 --- 3.23 30 month Fixed-term/Fixed-rate 1,000 0.11 3.03 35 month Fixed-term/Fixed-rate 1,000 0.03 3.37 35 month IRA Fixed-term/Fixed-rate 1,000 0.05 3.06 36 month Fixed-term/Fixed-rate 1,000 6,907 2.68 2.91 36 month IRA Fixed-term/Fixed-rate 1,000 2,483 0.96 3.57 48 month Fixed-term/Fixed-rate 1,000 0.32 3.47 48 month IRA Fixed-term/Fixed-rate 1,000 0.09 4.94 55 month Fixed-term/Fixed-rate 1,000 5,639 2.19 4.91 55 month IRA Fixed-term/Fixed-rate 1,000 1,010 0.39 4.18 60 month Fixed-term/Fixed-rate 1,000 6,912 2.68 3.14 60 month IRA Fixed-term/Fixed-rate 1,000 2,463 0.95 4.00 84 month Fixed-term/Fixed-rate 1,000 0.03 3.96 96 month Fixed-term/Fixed-rate 1,000 --- $258,069 100.00% Next Page The following table indicates the amount of the Bank's jumbo certificates of deposit by time remaining until maturity as of June 30, 2006. |
Under the regulations, an institution shall be deemed to be (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier I risk-based capital ratio of 6.0% or more, has a leverage ratio of 5.0% or more and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, has a Tier I risk-based capital ratio of 4.0% or more, has a leverage ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of "well capitalized;" (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, has a Tier I risk-based capital ratio that is less than 4.0% or has a leverage ratio that is less than 4.0% (3.0% under certain circumstances); (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0%, has a Tier I risk-based capital ratio that is less than 3.0% or has a leverage ratio that is less than 3.0%; and (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%. |
The FDIA provides that the appropriate federal regulatory agency must require an insured depository institution that is significantly undercapitalized or is undercapitalized and either fails to submit an acceptable capital restoration plan within the time period allowed or fails in any material respect to implement a capital restoration plan accepted by the appropriate federal banking agency to take one or more of the following actions: (i) sell enough shares, including voting shares, to become adequately capitalized; (ii) merge with (or be sold to) another institution (or holding company), but only if grounds exist for appointing a conservator or receiver; (iii) restrict certain transactions with banking affiliates as if the "sister bank" requirements of Section 23A of the Federal Reserve Act ("FRA") did not exist; (iv) otherwise restrict transactions with bank or non-bank affiliates; (v) restrict interest rates that the institution pays on deposits to "prevailing rates" in the institution's region; (vi) restrict asset growth or reduce total assets; (vii) alter, reduce or terminate activities; (viii) hold a new election of directors; (ix) dismiss any director or senior executive officer who held office for more than 180 days immediately before the institution became undercapitalized; (x) employ "qualified" senior executive officers; (xi) cease accepting deposits from correspondent depository institutions; (xii) divest certain non-depository affiliates which pose a danger to the institution; (xiii) be divested by a parent holding company; and (xiv) take any other action which the agency determines would better carry out the purposes of the Prompt Corrective Action provisions. |
By: /s/ James W. Tatum James W. Tatum Chairman of the Board of Directors September 27, 2006 By: /s/ Greg A. Steffens Greg A. Steffens President (Principal Executive and Financial and Accounting Officer) September 27, 2006 By: /s/ Samuel H. Smith Samuel H. Smith Vice President and Director September 27, 2006 By: /s/ Ronnie D. Black Ronnie D. Black Secretary and Director September 27, 2006 By: /s/ L. Douglas Bagby L. Douglas Bagby Director September 27, 2006 By: /s/ Sammy A. Schalk Sammy A. Schalk Director September 27, 2006 By: /s/ Rebecca McLane Brooks Rebecca McLane Brooks Director September 27, 2006 By: /s/ Charles R. Love Charles R. Love Director September 27, 2006 By: /s/ Charles R. Moffitt Charles R. Moffitt Director September 27, 2006 Next Page Index to Exhibits Regulation S-B Exhibit Number Document Statement Regarding Computation of Per Share Earnings 2006 Annual Report to Stockholders Subsidiaries of the Registrant Consent of Auditors Rule 13a-14(a)/15d-14(a) Certifications Section 1350 Certifications End. |
These risks include: •Disproportionate negative impact from COVID-19 in a foreign location; •Fluctuations of foreign currency and exchange rates, which can impact sales, costs of the goods we sell and the reporting of our results and assets on our financial statements; •Changes in international trade laws, trade agreements, or trading relationships affecting our import and export activities, including export license requirements, restrictions on the export of certain technology and tariff changes, or the imposition of new or increased trade sanctions; •Difficulties in collecting accounts receivable and longer collection periods; •Changes in, or expiration of, various foreign incentives that provide economic benefits to us; •Labor laws or practices that impact our ability and costs to hire, retain and discharge employees; •Difficulties in staffing and managing operations in foreign countries; •Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), and laws related to data privacy such as GDPR and other similar privacy laws that impact our IT systems and processes; •Global economic and financial market instability related to the U.K.’s referendum withdrawal from the E.U., as well as instability from the possibility of withdrawal of other E.U. |
These risks include: • Fluctuations of foreign currency and exchange rates, which can impact sales, costs of the goods we sell and the reporting of our results and assets on our financial statements; • Changes in international trade laws, trade agreements, or trading relationships affecting our import and export activities, including export license requirements, restrictions on the export of certain technology and tariff changes, or the imposition of new or increased trade sanctions; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Labor laws or practices that impact our ability and costs to hire, retain and discharge employees; • Difficulties in staffing and managing operations in foreign countries; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), and laws related to data privacy such as GDPR and other similar privacy laws that impact our IT systems and processes; • Global economic and financial market instability related to the U.K.’s referendum withdrawal from the E.U., as well as instability from the possibility of withdrawal of other E.U. |
SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2019 The components of the cash flow hedge included in accumulated other comprehensive (loss) income, net of income taxes, in the Consolidated Statements of Shareholders’ Equity, are as follows: The Company has the following derivative instruments located on the Consolidated Balance Sheets and Income Statements as of June 30, 2019, utilized for the risk management purposes detailed above: The Company has the following derivative instruments located on the Consolidated Balance Sheets and Income Statements as of June 30, 2018, utilized for the risk management purposes detailed above: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2019 (10) Fair Value of Financial Instruments Accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. |
Income tax expense (benefit) consists of: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2019 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 21% for the fiscal year ended June 30, 2019, a blended statutory rate of 28.0% for the fiscal year ended June 30, 2018 and a statutory rate of 35% for the fiscal year ended and June 30, 2017 to actual income tax expense is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2019 The components of pretax earnings are as follows: As of June 30, 2019, there were (i) gross net operating loss carryforwards of approximately $4.0 million for U.S. federal income tax purposes; (ii) gross state net operating loss carryforwards of approximately $7.3 million; (iii) foreign gross net operating loss carryforwards of approximately $19.0 million; (iv) state income tax credit carryforwards of approximately $2.5 million that will began to expire in the 2020 tax year; and (v) withholding tax credits of approximately $4.0 million; and (vi) foreign tax credits of $0.5 million. |
Our Bylaws provide that such notice shall set forth in writing: (i) whether the shareholder is providing the notice at the request of a beneficial holder of shares, whether the shareholder, any such beneficial holder or any nominee has any agreement, arrangement or understanding with, or has received any financial assistance, funding or other consideration from, any other person with respect to the investment by the shareholder or such beneficial holder in the Company or the matter the notice relates to, and the details thereof, including the name of such other person (the shareholder, any beneficial holder on whose behalf the notice is being delivered, any nominees listed in the notice and any persons with whom such agreement, arrangement or understanding exists or from whom such assistance has been obtained are hereinafter collectively referred to as “Interested Persons”), (ii) the name and address of all Interested Persons, (iii) a complete listing of the record and beneficial ownership positions (including number or amount) of all equity securities and debt instruments, whether held in the form of loans or capital market instruments, of the Company or any of its subsidiaries held by all Interested Persons, (iv) whether and the extent to which any hedging, derivative or other transaction is in place or has been entered into within the prior six months preceding the date of delivery of the notice by or for the benefit of any Interested Person with respect to the Company or its subsidiaries or any of their respective securities, debt instruments or credit ratings, the effect or intent of which transaction is to give rise to gain or loss as a result of changes in the trading price of such securities or debt instruments or changes in the credit ratings for the Company, its subsidiaries or any of their respective securities or debt instruments (or, more generally, changes in the perceived creditworthiness of the Company or its subsidiaries), or to increase or decrease the voting power of such Interested Person, and if so, a summary of the material terms thereof, and (v) a representation that the shareholder is a holder of record of stock of the Company that would be entitled to vote at the meeting and intends to appear in person or by proxy at the meeting to propose the matter set forth in the notice. |
These risks include: • Fluctuations of foreign currency and exchange rates, which can impact sales, costs of the goods we sell and the reporting of our results and assets on our financial statements; • Changes in international trade laws, trade agreements, or trading relationships affecting our import and export activities, including export license requirements, restrictions on the export of certain technology and tariff changes, or the imposition of new or increased trade sanctions; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Labor laws or practices that impact our ability and costs to hire, retain and discharge employees; • Difficulties in staffing and managing operations in foreign countries; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), and laws related to data privacy such as GDPR and other similar privacy laws that impact our IT systems and processes; • Global economic and financial market instability related to the U.K.’s referendum withdrawal from the E.U., as well as instability from the possibility of withdrawal of other E.U. |
SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2018 The components of the cash flow hedge included in accumulated other comprehensive income (loss), net of income taxes, in the Consolidated Statements of Shareholders’ Equity, are as follows: The Company has the following derivative instruments located on the Consolidated Balance Sheets and Income Statements as of June 30, 2018, utilized for the risk management purposes detailed above: The Company has the following derivative instruments located on the Consolidated Balance Sheets and Income Statements as of June 30, 2017, utilized for the risk management purposes detailed above: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2018 (9) Fair Value of Financial Instruments Accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. |
SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2018 Income tax expense (benefit) consists of: A reconciliation of the U.S. Federal income tax expense at a blended statutory rate of 28% for the fiscal year ended June 30, 2018 and a statutory rate of 35% for the June 30, 2017 and 2016 fiscal years to actual income tax expense is as follows: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2018 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: The components of pretax earnings are as follows: As of June 30, 2018, there were (i) gross net operating loss carryforwards of approximately $2.4 million for U.S. federal income tax purposes; (ii) gross state net operating loss carryforwards of approximately $4.1 million; (iii) foreign gross net operating loss carryforwards of approximately $17.8 million; (iv) state income tax credit carryforwards of approximately $2.2 million that will began to expire in the 2018 tax year; and (v) withholding tax credits of approximately $3.5 million; and (vi) foreign tax credits of $0.6 million. |
(12) Income Taxes Income tax expense (benefit) consists of: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2017 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2017 The components of pretax earnings are as follows: As of June 30, 2017, there were (i) gross net operating loss carryforwards of approximately $1.4 million for state income tax purposes; (ii) foreign gross net operating loss carryforwards of approximately $9.3 million; (iii) state income tax credit carryforwards of approximately $1.4 million that will began to expire in 2019; and (iv) withholding tax credits of approximately $2.9 million; and (v) foreign tax credits of less than $0.3 million. |
(12) Income Taxes Income tax expense (benefit) consists of: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2016 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2016 The components of pretax earnings are as follows: As of June 30, 2016, there were (i) gross net operating loss carryforwards of approximately $1.4 million for state income tax purposes; (ii) foreign gross net operating loss carryforwards of approximately $9.0 million; (iii) state income tax credit carryforwards of approximately $1.3 million that will began to expire in 2018; and (iv) withholding tax credits of approximately $2.4 million; and (v) foreign tax credits of less than $0.1 million. |
These risks include: • Fluctuations of foreign currency, exchange controls and currency devaluations; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Changes in labor laws and regulations affecting our ability to hire and retain employees; • Difficulties in staffing and managing operations in foreign countries; • Changes in international trade laws, such as the North American Free Trade Agreement, affecting our import and export activities, including export license requirements, restrictions on the export of certain technology, and tariff changes; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation); • Potential political and economic instability and changes in governments; • Compliance with foreign and domestic import and export regulations and anti-corruption laws, including the Iran Threat Reduction and Syria Human Rights Act of 2012, U.S. Foreign Corrupt Practices Act, or similar laws of other jurisdictions for our business activities outside the United States, the violation of which could result in severe penalties including monetary fines, criminal proceedings and suspension of export privileges; • Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers; • Natural disasters, power shortages, telecommunication failures, water shortages, fires, medical epidemics or pandemics, and other manmade or natural disasters or business interruptions in a region or specific country; • Potential regulatory changes, including foreign environmental restrictions; and • Different general economic conditions. |
Factors that could cause actual results to differ materially include the following: our dependence upon information systems and the utilization and further implementation of a new ERP system without business disruption and in a timely and cost efficient manner; our ability to integrate acquisitions, and effectively manage and implement our growth strategies; our ability to manage the potential adverse effects of operating in foreign jurisdictions, including, adverse changes in economic, political and market conditions in Europe, Latin America, and in Brazil; our ability to hedge or mitigate the effects of fluctuations in foreign exchange rates; our dependence on vendors, product supply, and availability; our ability to decrease our cost structure in response to competitive price pressures and changes in demand for our products; our ability to compete in new and existing markets that are highly competitive; our ability to retain and expand our existing and new customer relationships; our ability to retain key employees, particularly senior management; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our ability to manage our business when general economic conditions are poor; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to centralize certain functions to provide efficient support to our business; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to remain profitable in the face of narrow margins; our ability to manage loss, disclosure or misappropriation of, or access to, information or other breaches of our information security; our dependence on third-party freight carriers; our ability to manage the distribution channels; our exposure to the volatility of earnings due to changes in fair value of assets and liabilities, including changes in the fair value of our earn-out obligation to the sellers of CDC, Imago ScanSource, and Network1, changes in accounting principles, and our ability to make estimates and the assumptions underlying the estimates, which could have an effect on earnings; our ability to avoid goodwill and long-lived asset impairments resulting in material non-cash charges to earnings; our ability to manage disruptions or loss of certain assets from terrorist or military operations or from natural disasters; our ability to comply with environmental regulations; our ability to obtain required capital at acceptable terms to fund our working capital and growth strategies; volatility of our earnings and stock price; and our ability to resolve or settle potentially adverse litigation matters. |
(12) Income Taxes Income tax expense (benefit) consists of: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2015 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2015 The components of pretax earnings are as follows: As of June 30, 2015, there were (i) gross net operating loss carryforwards of approximately $1.6 million for state income tax purposes; (ii) foreign gross net operating loss carryforwards of approximately $6.5 million; (iii) state income tax credit carryforwards of approximately $0.4 million that will began to expire in 2017; and (iv) withholding tax credits of approximately $1.9 million. |
These risks include: • Changes in international trade laws, such as the North American Free Trade Agreement, affecting our import and export activities, including export license requirements, restrictions on the export of certain technology, and tariff changes; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Changes in labor laws and regulations affecting our ability to hire and retain employees; • Difficulties in staffing and managing operations in foreign countries; • Fluctuations of foreign currency, exchange controls and currency devaluations; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation); • Potential political and economic instability and changes in governments; • Compliance with foreign and domestic import and export regulations and anti-corruption laws, including the Iran Threat Reduction and Syria Human Rights Act of 2012, U.S. Foreign Corrupt Practices Act, or similar laws of other jurisdictions for our business activities outside the United States, the violation of which could result in severe penalties including monetary fines, criminal proceedings and suspension of export privileges; • Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers; • Natural disasters, power shortages, telecommunication failures, water shortages, fires, medical epidemics or pandemics, and other manmade or natural disasters or business interruptions in a region or specific country; • Potential regulatory changes, including foreign environmental restrictions; and • Different general economic conditions. |
Factors that could cause actual results to differ materially include the following: our dependence upon information systems and the ability to transition to a new ERP system without business disruption and in a timely and cost efficient manner; our ability to integrate acquisitions, and effectively manage and implement our growth strategies; our ability to manage the potential adverse effects of operating in foreign jurisdictions, including, adverse changes in economic, political and market conditions in Europe, Latin America, and in Brazil, Venezuela, and Argentina in particular; our ability to hedge or mitigate the effects of fluctuations in foreign exchange rates; our dependence on vendors, product supply, and availability; our ability to decrease our cost structure in response to competitive price pressures and changes in demand for our products; our ability to compete in new and existing markets that are highly competitive; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our ability to effectively manage and implement our growth strategies; our ability to manage our business when general economic conditions are poor; our ability to retain and expand our existing and new customer relationships; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to retain key employees, particularly senior management; our ability to centralize certain functions to provide efficient support to our business; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to remain profitable in the face of narrow margins; our ability to manage loss, disclosure or misappropriation of, or access to, information or other breaches of our information security; our dependence on third-party freight carriers; our ability to manage the distribution channels; our ability to increase our business in Brazil; our exposure to the volatility of earnings due to changes in fair value of assets and liabilities, including changes in the fair value of our earn-out obligation to the sellers of CDC, changes in accounting principles, and our ability to make estimates and the assumptions underlying the estimates, which could have an effect on earnings; our ability to avoid goodwill and long-lived asset impairments resulting in material non-cash charges to earnings; our ability to manage disruptions or loss of certain assets from terrorist or military operations; our ability to obtain required capital at acceptable terms to fund our working capital and growth strategies; and our ability to resolve or settle potentially adverse litigation matters. |
(11) Income Taxes Income tax expense (benefit) consists of: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2014 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2014 The components of pretax earnings are as follows: At June 30, 2014 , the Company has (i) gross net operating loss carry forwards of less than $0.1 million for U.S. Federal income tax purposes that will begin to expire in 2020; (ii) gross net operating loss carry forwards of approximately $0.9 million for state income tax purposes; (iii) foreign gross net operating loss carry forwards of approximately $13.7 million; (iv) state income tax credit carry forwards of approximately $0.3 million that will begin to expire in 2016; (v) withholding tax credits of approximately $1.2 million; (vi) and foreign tax credits of $0.5 million. |
These risks include: • Changes in international trade laws, such as the North American Free Trade Agreement, affecting our import and export activities, including export license requirements, restrictions on the export of certain technology, and tariff changes; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Changes in labor laws and regulations affecting our ability to hire and retain employees; • Difficulties in staffing and managing operations in foreign countries; • Fluctuations of foreign currency, exchange controls and currency devaluations; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation); • Potential political and economic instability and changes in governments; • Compliance with foreign and domestic import and export regulations and anti-corruption laws, including the Iran Threat Reduction and Syria Human Rights Act of 2012, U.S. Foreign Corrupt Practices Act, or similar laws of other jurisdictions for our business activities outside the United States, the violation of which could result in severe penalties including monetary fines, criminal proceedings and suspension of export privileges; • Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers; • Natural disasters, power shortages, telecommunication failures, water shortages, fires, medical epidemics or pandemics, and other manmade or natural disasters or business interruptions in a region or specific country; • Potential regulatory changes, including foreign environmental restrictions; and • Different general economic conditions. |
Factors that could cause actual results to differ materially include the following: our ability to manage our business when general economic conditions are poor; our ability to manage the potential adverse effects of operating in foreign jurisdictions, including, adverse changes in economic, political and market conditions in Europe, Latin America, and in Brazil and Venezuela in particular; our dependence upon information systems and the ability to transition to a new ERP system without business disruption and in a timely and cost efficient manner; our dependence on vendors, product supply, and availability; our ability to retain key employees, particularly senior management; our ability to retain and expand our existing and new customer relationships; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to centralize certain functions to provide efficient support to our business; our ability to remain profitable in the face of narrow margins; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to compete in new and existing markets that are highly competitive; our ability to integrate acquisitions, including our ability to successfully integrate our CDC operations, and effectively manage and implement our growth strategies; our ability to obtain required capital at acceptable terms to fund our working capital and growth strategies; our ability to manage disruptions or loss of certain assets from terrorist or military operations; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our ability to increase our business in Brazil; our exposure to the volatility of earnings due to changes in fair value of assets and liabilities, including changes in the fair value of our earn-out obligation to the sellers of CDC, changes in accounting principles, and our ability to make estimates and the assumptions underlying the estimates, which could have an effect on earnings; our ability to avoid goodwill and long-lived asset impairments resulting in material non-cash charges to earnings; our ability to realize management efficiencies and other benefits from our worldwide management and business reporting structure reorganization; our ability to decrease our cost structure in response to competitive price pressures and changes in demand for our products; our dependence on third-party freight carriers; our ability to manage the distribution channels; our ability to manage loss, disclosure or misappropriation of, or access to, information or other breaches of our information security; our ability to resolve or settle potentially adverse litigation matters; and our ability to hedge or mitigate the effects of fluctuations in foreign exchange rates. |
(11) Income Taxes Income tax expense (benefit) consists of: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2013 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2013 The components of pretax earnings are as follows: At June 30, 2013 , the Company has (i) gross net operating loss carry forwards of approximately $0.1 million for U.S. Federal income tax purposes that will begin to expire in 2020; (ii) gross net operating loss carry forwards of approximately $0.9 million for state income tax purposes; (iii) foreign gross net operating loss carry forwards of approximately $11.9 million; (iv) state income tax credit carry forwards of approximately $0.2 million that will begin to expire in 2016; (v) withholding tax credits of approximately $0.8 million; and foreign tax credits of $0.1 million (vi). |
These risks include: • Changes in international trade laws, such as the North American Free Trade Agreement, affecting our import and export activities, including export license requirements, restrictions on the export of certain technology, and tariff changes; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Changes in labor laws and regulations affecting our ability to hire and retain employees; • Difficulties in staffing and managing operations in foreign countries; • Fluctuations of foreign currency, exchange controls and currency devaluations; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation); • Potential political and economic instability and changes in governments; • Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers; • Potential regulatory changes, including foreign environmental restrictions; and • Different general economic conditions. |
Factors that could cause actual results to differ materially include the following: our ability to manage our business when general economic conditions are poor; our ability to manage the potential adverse effects of operating in foreign jurisdictions; our dependence upon information systems and the ability to transition to a new ERP system without business disruption; our dependence on vendors, product supply, and availability; our ability to retain key employees, particularly senior management; our ability to retain and expand our existing and new customer relationships; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to centralize certain functions to provide efficient support to our business; our ability to remain profitable in the face of narrow margins; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to compete in new and existing markets that are highly competitive; our ability to integrate acquisitions and effectively manage and implement our growth strategies; our inability to obtain required capital at acceptable terms to fund our working capital and growth strategies; our ability to manage disruptions or loss of certain assets from terrorist or military operations; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our ability to manage volatility in earnings resulting from U.S. GAAP requirements to revalue our earnout obligation to the sellers of CDC; our inability to eliminate potential volatility in our net sales and operating results on a quarterly basis as a result of changes in demand for our products; our dependence on third-party freight carriers; our ability to resolve or settle potentially adverse litigation matters; and our ability to hedge or mitigate the effects of fluctuations in foreign exchange rates. |
/s/ Ernst & Young LLP Greenville, South Carolina August 24, 2012 ScanSource, Inc. and Subsidiaries Consolidated Balance Sheets (in thousands, except for share information) See accompanying notes to consolidated financial statements ScanSource, Inc. and Subsidiaries Consolidated Income Statements Years Ended June 30, 2012, 2011, and 2010 (in thousands, except for per share information) See accompanying notes to consolidated financial statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Shareholders’ Equity Years Ended June 30, 2012, 2011, and 2010 (in thousands, except for share information) See accompanying notes to consolidated financial statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Cash Flows Years Ended June 30, 2012, 2011, and 2010 (in thousands) See accompanying notes to consolidated financial statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements June 30, 2012 (1) Business and Summary of Significant Accounting Policies Business Description ScanSource, Inc. and its subsidiaries (the “Company”) is a leading wholesale distributor of specialty technology products, providing value-added distribution sales to resellers in the specialty technology markets. |
(11) Income Taxes Income tax expense (benefit) consists of: A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2012 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2012 The components of pretax earnings are as follows: At June 30, 2012, the Company has (i) gross net operating loss carry forwards of approximately $0.1 million for U.S. Federal income tax purposes that will begin to expire in 2020; (ii) gross net operating loss carry forwards of approximately $0.9 million for state income tax purposes; (iii) foreign gross net operating loss carry forwards of approximately $8.5 million; (iv) state income tax credit carry forwards of approximately $0.2 million that will begin to expire in 2025; and (v) withholding tax credits of approximately $0.5 million. |
These risks include: • Changes in international trade laws, such as the North American Free Trade Agreement, affecting our import and export activities, including export license requirements, restrictions on the export of certain technology, and tariff changes; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Changes in labor laws and regulations affecting our ability to hire and retain employees; • Difficulties in staffing and managing operations in foreign countries; • Fluctuations of foreign currency, exchange controls and currency devaluations; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation); • Potential political and economic instability and changes in governments; • Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers; • Potential regulatory changes, including foreign environmental restrictions; and • Different general economic conditions. |
Factors that could cause actual results to differ materially include the following: our ability to manage our business when general economic conditions are poor; our ability to manage the potential adverse effects of operating in foreign jurisdictions; our dependence upon information systems and the ability to transition to a new ERP without business disruption; our dependence on vendors, product supply, and availability; our ability to retain key employees, particularly senior management; our ability to retain and expand our existing and new customer relationships; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to centralize certain functions to provide efficient support to our business; our ability to remain profitable in the face of narrow margins; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to compete in new and existing markets that are highly competitive; our ability to integrate acquisitions and effectively manage and implement our growth strategies; our inability to obtain required capital at acceptable terms to fund our working capital and growth strategies; our ability to manage disruptions or loss of certain assets from terrorist or military operations; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our inability to manage volatility in earnings resulting from U.S. GAAP requirements to revalue our earnout obligation to the sellers of CDC; our inability to eliminate potential volatility in our net sales and operating results on a quarterly basis as a result of changes in demand for our products; our dependence on third-party freight carriers; our inability to resolve or settle potentially adverse litigation matters; and our ability to hedge or mitigate the effects of fluctuations in foreign exchange rates. |
/s/ Ernst & Young LLP Greenville, South Carolina August 29, 2011 Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Balance Sheets (in thousands, except for share information) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Income Statements Years Ended June 30, 2011, 2010, and 2009 (in thousands, except per share data) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Shareholders’ Equity Years Ended June 30, 2011, 2010, and 2009 (in thousands, except per share data) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Cash Flows Years Ended June 30, 2011, 2010, and 2009 (in thousands) See accompanying notes to consolidated financial statements Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements June 30, 2011 (1) Organization and Basis of Presentation Business Description ScanSource, Inc. (the “Company”) is a leading wholesale distributor of specialty technology products, providing value-added distribution sales to resellers in the specialty technology markets. |
(12) Income Taxes Income tax expense (benefit) consists of: Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2011 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: The components of pretax earnings are as follows: Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2011 At June 30, 2011, the Company has: (i) gross net operating loss carry forwards of approximately $0.1 million for U.S. Federal income tax purposes that will begin to expire in 2020; (ii) gross net operating loss carry forwards of approximately $0.9 million for state income tax purposes, (iii) foreign gross net operating loss carry forwards of approximately $1.2 million and (iv) state income tax credit carry forwards of approximately $0.1 million that will begin to expire in 2025. |
These risks include: • Changes in international trade laws, such as the North American Free Trade Agreement, affecting our import and export activities, including export license requirements, restrictions on the export of certain technology, and tariff changes; • Difficulties in collecting accounts receivable and longer collection periods; • Changes in, or expiration of, various foreign incentives that provide economic benefits to us; • Changes in labor laws and regulations affecting our ability to hire and retain employees; • Difficulties in staffing and managing operations in foreign countries; • Fluctuations of foreign currency, exchange controls and currency devaluations; • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation); • Potential political and economic instability and changes in governments; • Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers; • Potential regulatory changes, including foreign environmental restrictions; and • Different general economic conditions. |
Factors that could cause actual results to differ materially include the following: our ability to retain key employees, particularly senior management; our ability to retain and expand our existing and new customer relationships; our dependence on vendors, product supply, and availability; our ability to centralize certain functions to provide efficient support to our business; our dependence upon information systems; our ability to manage the potential adverse effects of operating in foreign jurisdictions; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to remain profitable in the face of narrow margins; our ability to compete in new and existing markets that are highly competitive; our ability to manage our business when general economic conditions are poor; our ability to effectively manage and implement our growth strategies; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our inability to eliminate potential volatility in our net sales and operating results on a quarterly basis as a result of changes in demand for our products; our dependence on third-party freight carriers; our inability to resolve or settle potentially adverse litigation matters; and our inability to obtain required capital at acceptable terms to fund our working capital and growth strategies. |
/s/ Ernst & Young LLP Greenville, South Carolina August 26, 2010 Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Balance Sheets (in thousands, except for share information) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Income Statements Years Ended June 30, 2010, 2009, and 2008 (in thousands, except per share data) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Shareholders’ Equity Years Ended June 30, 2010, 2009, and 2008 (in thousands, except per share data) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Cash Flows Years Ended June 30, 2010, 2009, and 2008 (in thousands) See accompanying notes to consolidated financial statements Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements June 30, 2010 (1) Business Description ScanSource, Inc. (“The Company”) is a leading wholesale distributor of specialty technology products, providing value-added distribution sales to resellers in the specialty technology markets. |
(12) Income Taxes Income tax expense (benefit) consists of: A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2010 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities at June 30, 2010 and 2009 are presented below: The components of pretax earnings are as follows: At June 30, 2010, the Company has: (i) gross net operating loss carry forwards of approximately $0.2 million for U.S. Federal income tax purposes that will begin to expire in 2020; (ii) gross net operating loss carry forwards of approximately $.9 million for state income tax purposes, (iii) foreign gross net operating loss carry forwards of approximately $.8 million and (iv) state income tax credit carry forwards of approximately $0.3 million that will begin to expire in 2024. |
Factors that could cause actual results to differ materially include the following: our ability to retain key employees, particularly senior management; our ability to retain and expand our existing and new customer relationships; our dependence on vendors, product supply, and availability; our ability to centralize certain functions to provide efficient support to our business; our dependence upon information systems; our ability to manage the potential adverse effects of operating in foreign jurisdictions; our ability to manage and limit our credit exposure due to the deterioration in the financial condition of our customers; our ability to remain profitable in the face of narrow margins; our ability to compete in new and existing markets that are highly competitive; our ability to manage our business when general economic conditions are poor; our ability to effectively manage and implement our growth strategies; our ability to manage and negotiate successful pricing and stock rotation opportunities associated with inventory value decreases; our ability to anticipate adverse changes in tax laws, accounting rules, and other laws and regulations; our inability to eliminate potential volatility in our net sales and operating results on a quarterly basis as a result of changes in demand for our products; our dependence on third-party freight carriers; our inability to resolve or settle potentially adverse litigation matters; and our inability to obtain required capital at acceptable terms to fund our working capital and growth strategies. |
/s/ Ernst & Young LLP Greenville, South Carolina August 27, 2009 Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Balance Sheets (in thousands, except for share information) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Income Statements Years Ended June 30, 2009, 2008, and 2007 (in thousands, except per share data) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Shareholders’ Equity Years Ended June 30, 2009, 2008, and 2007 (in thousands, except per share data) See accompanying notes to consolidated financial statements Index to Financial Statements ScanSource, Inc. and Subsidiaries Consolidated Statements of Cash Flows Years Ended June 30, 2009, 2008, and 2007 (in thousands) See accompanying notes to consolidated financial statements Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements June 30, 2009 (1) Business Description ScanSource, Inc. (“The Company”) is a leading wholesale distributor of specialty technology products, providing value-added distribution sales to resellers in the specialty technology markets. |
(12) Income Taxes Income tax expense (benefit) consists of: Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2009 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities at June 30, 2009 and 2008 are presented below: Index to Financial Statements SCANSOURCE, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements-(Continued) June 30, 2009 The components of pretax earnings are as follows: At June 30, 2009, the Company has: (i) gross net operating loss carry forwards of approximately $0.2 million for U.S. Federal income tax purposes that will begin to expire in 2020; (ii) gross net operating loss carry forwards of approximately $1.8 million for state income tax purposes and (iii) state income tax credit carry forwards of approximately $0.3 million that will begin to expire in 2022. |
Factors that could cause actual results to differ materially include the following: the Company’s dependence on vendors, product supply and availability, senior management, centralized functions and third-party shippers; the Company’s ability to compete successfully in a highly competitive market and to manage significant additions in personnel and increases in working capital; the Company’s ability to collect outstanding accounts receivable; the Company’s entry into new product markets in which it has no prior experience; the Company’s susceptibility to quarterly fluctuations in net sales and results of operations; the Company’s ability to manage successfully pricing or stock rotation opportunities associated with inventory value decreases; narrow profit margins; inventory risks due to shifts in market demand; dependence on information systems; credit exposure due to the deterioration in the financial condition of our customers; a downturn of the general economy; the inability to obtain required capital; potential adverse effects of acquisitions; fluctuations in interest rates, foreign currency exchange rates and exposure to foreign markets (the imposition of governmental controls, currency devaluation, export license requirements, restrictions on the export of certain technology, dependence on third party freight forwarders and the third party warehouse in Europe, political instability, trade restrictions, tariff changes, difficulties in staffing and managing international operations, changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), difficulties in collecting accounts receivable, longer collection periods and the impact of local economic conditions and practices), the impact of changes in income tax legislation; acts of war or terrorism; exposure to natural disasters; potential impact of labor strikes; volatility of common stock; and the accuracy of forecast data. |
Factors that could cause actual results to differ materially include the following: intense competition both domestically and internationally; narrow profit margins; inventory risks due to shifts in market demand; dependence on information systems; credit exposure due to the deterioration in the financial condition of our customers; a downturn of the general economy; the inability to obtain required capital; potential adverse effects of acquisitions; fluctuations in interest rates, foreign currency exchange rates and exposure to foreign markets [the imposition of governmental controls, currency devaluation, export license requirements, restrictions on the export of certain technology, political instability, trade restrictions, tariff changes, difficulties in staffing and managing international operations, changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), difficulties in collecting accounts receivable, longer collection periods and the impact of local economic conditions and practices], the impact of changes in income tax legislation; product supply and availability; dependence on independent shipping companies; changes in vendor terms and conditions; acts of war or terrorism; exposure to natural disasters; potential impact of labor strikes; volatility of common stock; and the accuracy of forecast data. |
Factors that could cause actual results to differ materially include the following: intense competition both domestically and internationally; narrow profit margins; inventory risks due to shift in market demand; dependence on information systems; credit exposure due to the deterioration in the financial condition of our customers; the general economy including the length and severity of the current economic downturn; the inability to obtain required capital; potential adverse effects of acquisitions; fluctuations in interest rates, foreign currency exchange rates and exposure to foreign markets (the imposition of governmental controls, currency devaluation, export license requirements, restrictions on the export of certain technology, political instability, trade restrictions, tariff changes, difficulties in staffing and managing international operations, changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), difficulties in collecting accounts receivable, longer collection periods and the impact of local economic conditions and practices), the impact of changes in income tax legislation; product supply and availability; dependence on independent shipping companies; changes in vendor terms and conditions; acts of war or terrorism; exposure to natural disasters; potential impact of labor strikes; volatility of common stock; and the accuracy of forecast data. |
25 Notes to Consolidated Financial Statements (a)(3) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (“the Company”) (1) 3.2 Amendment to Third Restated Articles of Incorporation of the Company (1) 3.3 Amendment to Third Restated Articles of Incorporation of the Company (2) 3.4 Amendment to Third Restated Articles of Incorporation of the Company (17) 3.5 Amended and Restated Bylaws of the Company (1) 3.6 Amendment to Amended and Restated Bylaws of the Company (17) 3.7 Second Amendment to Amended and Restated Bylaws of the Company (18) 4.1 Common Stock Warrant issued to Jingle Networks, Inc. (3) 4.2 Common Stock Warrant issued to Jingle Networks, Inc. (3) 4.3 Form of Stock Purchase Warrant to Purchase Shares of Series A Preferred Convertible Stock issued to Investors in Preferred Stock Sale (17) 4.4 Form of Senior Secured Convertible Revolver Bridge Note issued to Investors in Preferred Stock Sale (17) 10.1 Lease Agreement between Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (4) 10.2 2004 Stock Incentive Plan (5)* 10.3 2006 Stock Incentive Plan (6)* 10.4 Form of Stock Option Agreements and Exercise Notice under 2004 Stock Incentive Plan (7)* 10.5 Form of Restricted Stock Purchase Agreement under 2004 Stock Incentive Plan (7)* 10.6 1999 Employee Stock Purchase Plan, as amended (6)* 10.7 1994 Stock Incentive Plan, as amended (8)* 10.11 Metro One Telecommunications, Inc. |
Retention Plan and form of Retention Agreement thereunder (12)* 10.12 Form of Indemnity Agreement between the Company and its directors and officers (13) 10.13 Master Services Agreement for Directory Assistance Services, by and between the Company and Nextel Operations, Inc., dated as of January 1, 2005 (14) 10.14 Settlement Agreement and Disentanglement Transition Plan, by and between the Company and Nextel Operations, Inc. dated as of February 10, 2006 (15) 10.15 Telecom Information Services Agreement, by and between the Company and Jingle Networks, Inc., dated as of August 2, 2006 (16) 10.16 Registration Rights Agreement, by and between the Company and Jingle Networks, Inc., dated as of August 2, 2006 (3) 10.17 Registration Rights Agreement dated as of the 5th day of June, 2007, by and among the Company and certain holders its Series A Convertible Preferred Stock (17) 23.1 Consent of BDO Seidman LLP, independent registered public accounting firm 31.1 Certification of Principal Executive Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 31.2 Certification of Principal Financial Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 32.1 Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. |
25 Notes to Consolidated Financial Statements (a)(3) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (“the Company”) (1) 3.2 Amendment to Third Restated Articles of Incorporation of the Company (1) 3.3 Amendment to Third Restated Articles of Incorporation of the Company (2) 3.4 Amendment to Third Restated Articles of Incorporation of the Company (17) 3.5 Amended and Restated Bylaws of the Company (1) 3.6 Amendment to Amended and Restated Bylaws of the Company (17) 3.7 Second Amendment to Amended and Restated Bylaws of the Company (18) 4.1 Common Stock Warrant issued to Jingle Networks, Inc. (3) 4.2 Common Stock Warrant issued to Jingle Networks, Inc. (3) 4.3 Form of Stock Purchase Warrant to Purchase Shares of Series A Preferred Convertible Stock issued to Investors in Preferred Stock Sale (17) 4.4 Form of Senior Secured Convertible Revolver Bridge Note issued to Investors in Preferred Stock Sale (17) 10.1 Lease Agreement between Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (4) 10.2 2004 Stock Incentive Plan (5)* 10.3 2006 Stock Incentive Plan (6)* 10.4 Form of Stock Option Agreements and Exercise Notice under 2004 Stock Incentive Plan (7)* 10.5 Form of Restricted Stock Purchase Agreement under 2004 Stock Incentive Plan (7)* 10.6 1999 Employee Stock Purchase Plan, as amended (6)* 10.7 1994 Stock Incentive Plan, as amended (8)* 10.11 Metro One Telecommunications, Inc. |
Retention Plan and form of Retention Agreement thereunder (12)* 10.12 Form of Indemnity Agreement between the Company and its directors and officers (13) 10.13 Master Services Agreement for Directory Assistance Services, by and between the Company and Nextel Operations, Inc., dated as of January 1, 2005 (14) 10.14 Settlement Agreement and Disentanglement Transition Plan, by and between the Company and Nextel Operations, Inc. dated as of February 10, 2006 (15) 10.15 Telecom Information Services Agreement, by and between the Company and Jingle Networks, Inc., dated as of August 2, 2006 (16) 10.16 Registration Rights Agreement, by and between the Company and Jingle Networks, Inc., dated as of August 2, 2006 (3) 10.17 Registration Rights Agreement dated as of the 5th day of June, 2007, by and among the Company and certain holders its Series A Convertible Preferred Stock (17) 23.1 Consent of BDO Seidman LLP, independent registered public accounting firm 31.1 Certification of Principal Executive Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 31.2 Certification of Principal Financial Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 32.1 Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. |
We cannot control many of these factors, which include, among others: · Changes in the telecommunications market, including the addition or withdrawal of carriers from the market, changes in technology and increased competition from existing and new competitors; · The timing and expense of our call center network expansion or contraction, including changing staffing and infrastructure expenses related to anticipated call volume changes; · The addition or expiration of contracts with carrier customers; · Changes in our or our competitors’, customers’ or suppliers’ pricing policies; · Lengthy sales cycles for new and extended contracts; · The timing of the commencement of our services under new or existing contracts with our carrier customers, which depends in part on the customers’ ability to adapt their networks and billing systems to allow them to transfer calls to us; · Lack of market acceptance or delays or increased development costs related to the introduction of our services or features; and · General economic conditions. |
33 Notes to Consolidated Financial Statements (a)(3) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (“the Company”) (1) 3.2 Amendment to Third Restated Articles of Incorporation of the Company (1) 3.3 Amended and Restated Bylaws of the Company (1) 3.4 Amendment to Third Restated Articles of Incorporation of the Company (2) 4.1 Common Stock Warrant issued to Jingle Networks, Inc. (3) 4.2 Common Stock Warrant issued to Jingle Networks, Inc. (3) 10.1 Lease Agreement between Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (4) 10.2 Stock Incentive Plan (5)* 10.3 Stock Incentive Plan (6)* 10.4 Form of Stock Option Agreements and Exercise Notice under 2004 Stock Incentive Plan (7)* 10.5 Form of Restricted Stock Purchase Agreement under 2004 Stock Incentive Plan (7)* 10.6 Employee Stock Purchase Plan, as amended (6)* 10.7 Stock Incentive Plan, as amended (8)* 10.8 Separation and Consulting Agreement between Timothy A. Timmins and the Company, date October 4, 2005 (9)* 10.9 Consulting Agreement between James M. Usdan and the Company, dated October 4, 2005 (10)* 10.10 Amendment letter to Consulting Agreement between James M. Usdan and the Company, dated June 1, 2006 (11)* 10.11 Metro One Telecommunications, Inc. |
Retention Plan and form of Retention Agreement thereunder (12)* 10.12 Form of Indemnity Agreement between the Company and its directors and officers (13) 10.13 Master Services Agreement for Directory Assistance Services, by and between the Company and Nextel Operations, Inc., dated as of January 1, 2005 (14) 10.14 Settlement Agreement and Disentanglement Transition Plan, by and between the Company and Nextel Operations, Inc. dated as of February 10, 2006 (15) 10.15 Telecom Information Services Agreement, by and between the Company and Jingle Networks, Inc., dated as of August 2, 2006 (16) 10.16 Registration Rights Agreement, by and between the Company and Jingle Networks, Inc., dated as of August 2, 2006 (3) 23.1 Consent of BDO Seidman LLP, independent registered public accounting firm 23.2 Consent of Deloitte & Touche LLP, independent registered public accounting firm 31.1 Certification of Principal Executive Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 31.2 Certification of Principal Financial Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 32.1 Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. |
Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the date indicated: Signature Title Date /s/ Gary E. Henry President, Chief Executive Officer and Director April 2, 2007 Gary E. Henry (Principal Executive Officer) /s/ Duane C. Fromhart Senior Vice President, Chief Financial Officer April 2, 2007 Duane C. Fromhart (Principal Financial and Accounting Officer) /s/ William D. Rutherford Chairman of the Board of Directors April 2, 2007 William D. Rutherford /s/ Elchanan (Nani) Maoz Director April 2, 2007 Elchanan (Nani) Maoz /s/ Mary H. Oldshue Director April 2, 2007 Mary H. Oldshue /s/ Murray L. Swanson Director April 2, 2007 Murray L. Swanson /s/ James M. Usdan Director April 2, 2007 James M. Usdan REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of Metro One Telecommunications, Inc. Portland, Oregon We have audited the accompanying consolidated balance sheet of Metro One Telecommunications, Inc. and subsidiaries (the “Company”) as of December 31, 2006, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the year then ended. |
We cannot control many of these factors, which include, among others: • Changes in the telecommunications market, including the addition or withdrawal of carriers from the market, changes in technology and increased competition from existing and new competitors; • The timing and expense of our call center network expansion or contraction, including changing staffing and infrastructure expenses related to anticipated call volume changes; • The addition or expiration of contracts with carrier customers; • Changes in our or our competitors’, customers’ or suppliers’ pricing policies; • Lengthy sales cycles for new and extended contracts; • The timing of the commencement of our services under new or existing contracts with our carrier customers, which depends in part on the customers’ ability to adapt their networks and billing systems to allow them to transfer calls to us; • Lack of market acceptance or delays or increased development costs related to the introduction of our services or features; and • General economic conditions. |
35 Notes to Consolidated Financial Statements (a)(3) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (“the Company”) (1) 3.2 Amendment to Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (1) 3.3 Amended and Restated Bylaws of Metro One Telecommunications, Inc. (1) 10.1 Lease Agreement between Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (2) 10.2 Commercial Lease Agreement between Murray Scholls, LLC and the Company (3) 10.3 Metro One Telecommunications Deferred Compensation Plan Document (3)* 10.4 Amendment to Metro One Telecommunications Deferred Compensation Plan (4)* 10.5 2004 Stock Incentive Plan (5)* 10.6 Form of Stock Option Agreements and Exercise Notice under 2004 Stock Incentive Plan (6)* 10.7 Form of Restricted Stock Purchase Agreement under 2004 Stock Incentive Plan (6)* 10.8 1999 Employee Stock Purchase Plan, as amended (3)* 10.9 1994 Stock Incentive Plan, as amended (7)* 10.10 2003 Employment Agreement with Timothy A. Timmins (8)* 10.11 Separation and Consulting Agreement between Timothy A. Timmins and the Company (9)* 10.12 Consulting Agreement between James M. Usdan and the Company (10)* 10.13 Metro One Telecommunications, Inc. |
We cannot control many of these factors, which include, among others: • Changes in the telecommunications market, including the addition or withdrawal of carriers from the market, changes in technology and increased competition from existing and new competitors; • The timing and expense of our call center network expansion or contraction, including changing staffing and infrastructure expenses related to anticipated call volume changes; • The continued costs of advertising, marketing and promotion of Infone without commensurate consumer acceptance or revenues; • The addition or expiration of contracts with carrier customers; • Changes in our or our competitors’, customers’ or suppliers’ pricing policies; • Lengthy sales cycles for new and extended contracts; • The timing of the commencement of our services under new or existing contracts with our carrier customers, which depends in part on the customers’ ability to adapt their networks and billing systems to allow them to transfer calls to us; • Lack of market acceptance or delays or increased development costs related to the introduction of our services or features; and • General economic conditions. |
31 Notes to Consolidated Financial Statements (a)(3) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (1) 3.2 Amendment to Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (1) 3.3 Amended and Restated Bylaws of Metro One Telecommunications, Inc. (1) 10.1 Lease Agreement between Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (2) 10.2 Commercial Lease Agreement between Murray Scholls, LLC and the Company (3) 10.3 Metro One Telecommunications Deferred Compensation Plan Document (3)* 10.4 Amendment to Metro One Telecommunications Deferred Compensation Plan (4)* 10.5 2004 Stock Incentive Plan (5)* 10.6 Form of Stock Option Agreements and Exercise Notice under 2004 Stock Incentive Plan (6)* 10.7 Form of Restricted Stock Purchase Agreement under 2004 Stock Incentive Plan (6)* 10.8 1999 Employee Stock Purchase Plan, as amended (3)* 10.9 1994 Stock Incentive Plan, as amended (7)* 10.10 2003 Employment Agreement with Timothy A. Timmins (8)* 23.1 Consent of Independent Registered Public Accounting Firm 31.1 Certification of Principal Executive Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 31.2 Certification of Principal Financial Officer pursuant to Securities and Exchange Commission Rule 13a-14(a) 32.1 Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. |
Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the date indicated: Signature Title Date /s/ Timothy A. Timmins President, Chief Executive March 16, 2005 Timothy A. Timmins Officer and Director (Principal Executive Officer) s/ Gary E. Henry Executive Vice President, March 16, 2005 Gary E. Henry Chief Operating Officer and Director /s/ Duane C. Fromhart Senior Vice President, March 16, 2005 Duane C. Fromhart Chief Financial Officer (Principal Financial and Accounting Officer) /s/ William D. Rutherford Chairman of the Board of Directors March 16, 2005 William D. Rutherford /s/ Roger L. Pringle Director March 16, 2005 Roger L. Pringle /s/ James M. Usdan Director March 16, 2005 James M. Usdan /s/ David A. Williams Director March 16, 2005 David A. Williams MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). |
We cannot control many of these factors, which include, among others: • Changes in the telecommunications market, including the addition or withdrawal of carriers from the market, changes in technology and increased competition from existing and new competitors; • The timing and expense of our call center network expansion or contraction, including changing staffing and infrastructure expenses related to anticipated call volume changes; • The continued costs of advertising, marketing and promotion of Infone without commensurate consumer acceptance or revenues; • The addition or expiration of contracts with carrier customers; • Changes in our or our competitors’, customers’ or suppliers’ pricing policies; • Lengthy sales cycles for new and extended contracts; • The timing of the commencement of our services under new or existing contracts with our carrier customers, which depends in part on the customers’ ability to adapt their networks and billing systems to allow them to transfer calls to us; • Lack of market acceptance or delays or increased development costs related to the introduction of our services or features; and • General economic conditions. |
EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K. (a)(1) Financial Statements Independent Auditors’ Report Statements of Operations for each of the years ended December 31, 2003, 2002 and 2001 Balance Sheets at December 31, 2003 and 2002 Statements of Shareholders’ Equity for each of the years ended December 31, 2003, 2002 and 2001 Statements of Cash Flows for each of the years ended December 31, 2003, 2002 and 2001 Notes to Financial Statements (a)(2) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. 3.2 Amendment to Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. 3.3 Amended and Restated Bylaws of Metro One Telecommunications, Inc. 10.1 Form of Enhanced Directory Assistance Agreement (1) 10.11 Lease Agreement between and among Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (2) 10.21 Commercial Lease Agreement between Murray Scholls, LLC and the Company (3) 10.23 Deferred Compensation Plan Document (3)* 10.24 1999 Employee Stock Purchase Plan, as amended (3)* 10.27 1994 Stock Incentive Plan, as amended (4)* 10.28 2003 Employment Agreement with Timothy A. Timmins (5)* 23.1 Consent of Deloitte & Touche LLP, independent auditors 31.1 Certification of Timothy A. Timmins pursuant to Rule 15d-14(a) 31.2 Certification of Dale N. Wahl pursuant to Rule 15d-14(a) 32.1 Certification Pursuant to 18 U.S.C. |
EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K. (a)(1) Financial Statements Independent Auditors’ Report Statements of Income for each of the years ended December 31, 2002, 2001 and 2000 Balance Sheets at December 31, 2002 and Statements of Shareholders’ Equity for each of the years ended December 31, 2002, 2001 and Statements of Cash Flows for each of the years ended December 31, 2002, 2001 and 2000 Notes to Financial Statements (a)(2) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (3) 3.2 Amended and Restated Bylaws of Metro One Telecommunications, Inc. (1) 10.1 Form of Enhanced Directory Assistance Agreement (4) 10.11 Lease Agreement between and among Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (2) 10.19 Stock Purchase Agreement between the Company and Sonera Media Holding B.V. dated as of November 8, 2000 (5) 10.20 Investment Agreement between the Company and Sonera Media Holding B.V. dated as of February 2, 2001 (6) 10.21 Registration Rights Agreement between the Company and Sonera Media Holding B.V. dated as of February 2, 2001 (6) 10.22 Commercial Lease Agreement between Murray Scholls, LLC and the Company (7) 10.23 Deferred Compensation Plan Document (7)* 10.24 Agreement for Enhanced Directory Assistance Services between Metro One and AT&T Wireless Services, Inc. dated December 1, 2000 (7)(9) 10.25 1999 Employee Stock Purchase Plan (7)* 10.27 1994 Stock Incentive Plan (8)* 10.28 2003 Employment Agreement with Timothy A. Timmins* 23.1 Consent of Deloitte & Touche LLP, independent auditors 99.1 Certification Pursuant to 18 U.S.C. |
27 Statements of Cash Flows for each of the years ended December 31, 2001, 2000 and 1999 Pg 28 Notes to Financial Statements (a)(2) Exhibits 3.1 Third Restated Articles of Incorporation of Metro One Telecommunications, Inc. (4) 3.2 Amended and Restated Bylaws of Metro One Telecommunications, Inc. (1) 10.1 Form of Enhanced Directory Assistance Agreement (6) 10.5 1995 Employment Agreement with Timothy A. Timmins (5)* 10.6 Lease Agreement between and among Petula Associates, Ltd., Koll Creekside Associates and the Company (2) 10.7 Enhanced Directory Assistance Agreement between Sprint Spectrum L.P. and the Company dated October 23, 1996 (3)(8) 10.11 Lease Agreement between and among Murray Scholls, LLC, Gramor Development Northwest, Inc. and the Company (3) 10.12 Amendment #1 to Specific Agreement between Sprint Spectrum L.P. and the Company dated December 9, 1998 (3)(8) 10.18 Amendment to 1995 Employment Agreement with Timothy A. Timmins (7)* 10.19 Stock Purchase Agreement between the Company and Sonera Media Holding B.V. dated as of November 8, 2000 (9) 10.20 Investment Agreement between the Company and Sonera Media Holding B.V. dated as of February 2, 2001 (10) 10.21 Registration Rights Agreement between the Company and Sonera Media Holding B.V. dated as of February 2, 2001 (10) 10.22 Commercial Lease Agreement between Murray Scholls, LLC and the Company (11) 10.23 Deferred Compensation Plan Document (11)* 10.24 Agreement for Enhanced Directory Assistance Services between Metro One and AT&T Wireless Services, Inc. dated December 1, 2000 (8) 10.25 1999 Employee Stock Purchase Plan (11)* 10.27 1994 Stock Incentive Plan (12)* 23.1 Consent of Deloitte & Touche LLP, independent auditors * Management contract or compensatory plan (1) Incorporated herein by reference to the Company’s Registration Statement on Form S-1 dated August 22, 1996, File No. |
We cannot control many of these factors, which include, among others: - - Changes in the telecommunications market, including the addition or withdrawal of carriers from the market, changes in technology and increased competition from existing and new competitors; - - The timing of the commencement of our services under new or existing contracts with our carrier customers, which depends in part on the customers' ability to adapt their networks and billing systems to allow them to transfer calls to us; - - The timing and expense of our call center network expansion, including increased staffing and infrastructure expenses related to anticipated new call volume; - - The addition or expiration of contracts with carrier customers; - - Changes in our or our competitors', customers' or suppliers' pricing policies; - - Lengthy sales cycles for new and extended contracts; - - Lack of market acceptance or delays or increased development costs related to the introduction of our services or features; and - - General economic conditions. |
Page 44 of 51 Involvement in certain legal proceedings Our directors, executive officers and control persons have not been involved in any of the following events during the past ten year: 1) filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a court for the business or present of such a person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer within two years before the time of such filing 2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) 3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting the following activities: (i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor, underwriter, broker or dealer in securities, or as an affiliated person, director of any investment company, or engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of business practice; (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodity laws; 4) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity; 5) was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law and the judgment in subsequently reversed, suspended or vacate; 6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; 7) was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (i) any Federal or State securities or commodities law or regulation; or (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or (iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; 8) was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. |
ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES Exhibit Number Description of Exhibits 3.1 Articles of Incorporation (1) 3.2 Article of Amendment changing name to REGI U.S., Inc. (2) 3.3 By-laws (1) 3.4 Articles of Amendment Increasing Authorized Capital to 50,000,000 December 2003 (7) 3.5 Articles of Amendment Increasing Authorized Capital to 100,000,000 May 2007 (8) 4.1 Specimen Share Certificate (1) 4.2 Specimen Warrant Certificate (1) 10.1 Consulting Agreement, dated December 1, 1999, between REGI U.S., Inc. and Patrick Badgley (3) 10.2 Special Service Proposal, dated December 21, 1999, between REGI U.S. and ColTec, Inc. (3) 10.3 Agreement between ColTec and REGI dated October 2000 (4) 10.4 Agreement between REGI and Advanced Ceramics Research dated March 20, 2002 (5) 10.5 License Agreement between Rand Energy Group, Inc., and Reg Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April 24, 2002 (5) 10.6 Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 22, 2002 (6) 10.7 Amendment to Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 2, 2003 (6) 10.8 Management Agreement with Access Information Services, Inc., dated January 2, 1993 in the name of Sky Technologies, Inc. (the Company’s previous name) (9) 10.9 Engagement Letter with The Otto Law Group, dated August 4, 2004 (9) 10.10 Project Cost Sharing Agreement with Reg Technologies Inc. (11) 10.11 Amended Asset Purchase Agreement (10) 14.1 Code of Business Conduct and Ethics (7) 21.1 List of Subsidiaries (11) 31.1 Certification of Principal Executive Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
(b) Management’s Annual Report on Internal Control over Financial Reporting Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that: (1) Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; (2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorization of our management and directors; and (3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our assets that could have a material effect on the financial statements. |
Involvement in certain legal proceedings Our directors, executive officers and control persons have not been involved in any of the following events during the past ten years: (1) filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a court for the business or present of such a person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer within two years before the time of such filing; (2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting the following activities: (i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor, underwriter, broker or dealer in securities, or as an affiliated person, director of any investment company, or engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of business practice; (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodity laws; (4) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity; (5) was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law and the judgment in subsequently reversed, suspended or vacate; (6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; (7) was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (i) any Federal or State securities or commodities law or regulation; or (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or (iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; (8) was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. |
Number Description 3.1 Articles of Incorporation (1) 3.2 Article of Amendment changing name to REGI U.S., Inc. (2) 3.3 By-laws (1) 3.4 Articles of Amendment Increasing Authorized Capital to 50,000,000 December 2003 (7) 3.5 Articles of Amendment Increasing Authorized Capital to 100,000,000 May 2007 (8) 4.1 Specimen Share Certificate (1) 4.2 Specimen Warrant Certificate (1) 10.1 Consulting Agreement, dated December 1, 1999, between REGI U.S., Inc. and Patrick Badgley (3) 10.2 Special Service Proposal, dated December 21, 1999, between REGI U.S. and ColTec, Inc. (3) 10.3 Agreement between ColTec and REGI dated October 2000 (4) 10.4 Agreement between REGI and Advanced Ceramics Research dated March 20, 2002 (5) 10.5 License Agreement between Rand Energy Group, Inc., and Reg Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April 24, 2002 (5) 10.6 Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 22, 2002 (6) 10.7 Amendment to Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 2, 2003 (6) 10.8 Management Agreement with Access Information Services, Inc., dated January 2, 1993 in the name of Sky Technologies, Inc. (the Company’s previous name) (9) 10.9 Engagement Letter with The Otto Law Group, dated August 4, 2004 (9) 10.10 Project Cost Sharing Agreement with Reg Technologies Inc. (9) 10.11 Amended Asset Purchase Agreement (11) 14.1 Code of Business Conduct and Ethics (10) 21.1 List of Subsidiaries (7) 23.1 Consent of Independent Auditors (Malone Bailey LLP) (11) 31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 32.1 Certification of Chief Executive Officer (Principal Executive Officer), pursuant to 18 U.S.C. |
(b) Management’s Annual Report on Internal Control over Financial Reporting Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that: (1) Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; (2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorization of our management and directors; and (3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our assets that could have a material effect on the financial statements. |
John G. Robertson - Director and CEO and President, resigned on July 17, 2016 James L. Vandeberg - Director, resigned on August 2, 2016 Thomas Robertson, - Directors, directorship terminated on January 6, 2017 Involvement in certain legal proceedings Our directors, executive officers and control persons have not been involved in any of the following events during the past ten years: (1) filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a court for the business or present of such a person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer within two years before the time of such filing; (2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting the following activities: (i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor, underwriter, broker or dealer in securities, or as an affiliated person, director of any investment company, or engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of business practice; (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodity laws; (4) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity; (5) was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law and the judgment in subsequently reversed, suspended or vacate; (6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; (7) was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (i) any Federal or State securities or commodities law or regulation; or (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or (iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; (8) was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. |
Number Description 3.1 Articles of Incorporation (1) 3.2 Article of Amendment changing name to REGI U.S., Inc. (2) 3.3 By-laws (1) 3.4 Articles of Amendment Increasing Authorized Capital to 50,000,000 December 2003 (7) 3.5 Articles of Amendment Increasing Authorized Capital to 100,000,000 May 2007 (8) 4.1 Specimen Share Certificate (1) 4.2 Specimen Warrant Certificate (1) 10.1 Consulting Agreement, dated December 1, 1999, between REGI U.S., Inc. and Patrick Badgley (3) 10.2 Special Service Proposal, dated December 21, 1999, between REGI U.S. and ColTec, Inc. (3) 10.3 Agreement between ColTec and REGI dated October 2000 (4) 10.4 Agreement between REGI and Advanced Ceramics Research dated March 20, 2002 (5) 10.5 License Agreement between Rand Energy Group, Inc., and Reg Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April 24, 2002 (5) 10.6 Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 22, 2002 (6) 10.7 Amendment to Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 2, 2003 (6) 10.8 Management Agreement with Access Information Services, Inc., dated January 2, 1993 in the name of Sky Technologies, Inc. (the Company’s previous name) (9) 10.9 Engagement Letter with The Otto Law Group, dated August 4, 2004 (9) 10.10 Project Cost Sharing Agreement with Reg Technologies Inc. (9) 10.11 Amended Asset Purchase Agreement (11) 14.1 Code of Business Conduct and Ethics (10) 21.1 List of Subsidiaries (7) 23.1 Consent of Independent Auditors (Malone Bailey LLP) (11) 31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 32.1 Certification of Chief Executive Officer (Principal Executive Officer), pursuant to 18 U.S.C. |
(b) Management’s Annual Report on Internal Control over Financial Reporting Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that: (1) Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; (2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorization of our management and directors; and (3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our assets that could have a material effect on the financial statements. |
Involvement in certain legal proceedings Our directors, executive officers and control persons have not been involved in any of the following events during the past ten years: (1) filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a court for the business or present of such a person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer within two years before the time of such filing; (2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting the following activities: (i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor, underwriter, broker or dealer in securities, or as an affiliated person, director of any investment company, or engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of business practice; (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodity laws; (4) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity; (5) was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law and the judgment in subsequently reversed, suspended or vacate; (6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; (7) was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (i) any Federal or State securities or commodities law or regulation; or (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or (iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; (8) was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. |
Number Description 3.1 Articles of Incorporation (1) 3.2 Article of Amendment changing name to REGI U.S., Inc. (2) 3.3 By-laws (1) 3.4 Articles of Amendment Increasing Authorized Capital to 50,000,000 December 2003 (7) 3.5 Articles of Amendment Increasing Authorized Capital to 100,000,000 May 2007 (8) 4.1 Specimen Share Certificate (1) 4.2 Specimen Warrant Certificate (1) 10.1 Consulting Agreement, dated December 1, 1999, between REGI U.S., Inc. and Patrick Badgley (3) 10.2 Special Service Proposal, dated December 21, 1999, between REGI U.S. and ColTec, Inc. (3) 10.3 Agreement between ColTec and REGI dated October 2000 (4) 10.4 Agreement between REGI and Advanced Ceramics Research dated March 20, 2002 (5) 10.5 License Agreement between Rand Energy Group, Inc., and Reg Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April 24, 2002 (5) 10.6 Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 22, 2002 (6) 10.7 Amendment to Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 2, 2003 (6) 10.8 Management Agreement with Access Information Services, Inc., dated January 2, 1993 in the name of Sky Technologies, Inc. (the Company’s previous name) (9) 10.9 Engagement Letter with The Otto Law Group, dated August 4, 2004 (9) 10.10 Project Cost Sharing Agreement with Reg Technologies Inc. (9) 14.1 Code of Business Conduct and Ethics (10) 21.1 List of Subsidiaries (7) 23.1 Consent of Independent Auditors (Malone Bailey LLP) (11) 31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 32.1 Certification of John G. Robertson, President and Chief Executive Officer (Principal Executive Officer), pursuant to 18 U.S.C. |
(b) Management’s Annual Report on Internal Control over Financial Reporting Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that: (1)Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; (2)Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorization of our management and directors; and (3)Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our assets that could have a material effect on the financial statements. |
Involvement in certain legal proceedings Our directors, executive officers and control persons have not been involved in any of the following events during the past ten years: (1)filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a court for the business or present of such a person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer within two years before the time of such filing; (2)was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (3)was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting the following activities: (i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor, underwriter, broker or dealer in securities, or as an affiliated person, director of any investment company, or engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of business practice; (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodity laws; (4)was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity; (5)was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law and the judgment in subsequently reversed, suspended or vacate; (6)was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; (7)was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (i) any Federal or State securities or commodities law or regulation; or (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or (iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; (8)was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. |
Number Description 3.1 Articles of Incorporation (1) 3.2 Article of Amendment changing name to REGI U.S., Inc. (2) 3.3 By-laws (1) 3.4 Articles of Amendment Increasing Authorized Capital to 50,000,000 December (7) 3.5 Articles of Amendment Increasing Authorized Capital to 100,000,000 May (8) 4.1 Specimen Share Certificate (1) 4.2 Specimen Warrant Certificate (1) 10.1 Consulting Agreement, dated December 1, 1999, between REGI U.S., Inc. and Patrick Badgley (3) 10.2 Special Service Proposal, dated December 21, 1999, between REGI U.S. and ColTec, Inc. (3) 10.3 Agreement between ColTec and REGI dated October 2000 (4) 10.4 Agreement between REGI and Advanced Ceramics Research dated March 20, 2002 (5) 10.5 License Agreement between Rand Energy Group, Inc., and Reg Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April 24, 2002 (5) 10.6 Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 22, 2002 (6) 10.7 Amendment to Agreement between REGI U.S., Inc. and Rotary Power Generation, Incorporated made as of April 2, 2003 (6) 10.8 Management Agreement with Access Information Services, Inc., dated January 2, 1993 in the name of Sky Technologies, Inc. (the Company’s previous name) (9) 10.9 Engagement Letter with The Otto Law Group, dated August 4, 2004 (9) 10.10 Project Cost Sharing Agreement with Reg Technologies Inc. (9) 14.1 Code of Business Conduct and Ethics (10) 21.1 List of Subsidiaries (7) 23.1 Consent of Independent Auditors (Malone Bailey LLP) (11) 31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (11) 32.1 Certification of John G. Robertson, President and Chief Executive Officer (Principal Executive Officer), pursuant to 18 U.S.C. |
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