☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ |
Delaware | 04-2217279 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
80 Orville Drive, Suite 102, Bohemia, New York | 11716 |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Name of each exchange on which registered |
None | None |
Title of Class |
Common stock, |
Large accelerated filer ☐ | Accelerated filer ☐ | |
Non-accelerated filer ☐ (Do not check if a smaller reporting company) | Smaller reporting company ☒ | |
Emerging Growth☐ |
Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Act) ☐ Yes ☒ No |
BUSINESS | 4 | |
RISK FACTORS | 8 | |
PROPERTIES | 12 | |
3. | LEGAL PROCEEDINGS | 12 |
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS | 12 | |
MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES | 13 | |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 14 | |
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA | 17 | |
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE | 17 | |
CONTROLS AND PROCEDURES | 17 | |
OTHER INFORMATION | 17 | |
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE | 18 | |
EXECUTIVE COMPENSATION | 19 | |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS | 24 | |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE | 26 | |
PRINCIPAL ACCOUNTANT FEES AND SERVICES | 26 | |
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES | 26 | |
35 | ||
CERTIFICATION | 36 | |
CERTIFICATION | ||
37 |
For Fiscal Quarter Ended | Low Bid | High Bid |
09/30/15 | 2.43 | 3.00 |
12/31/15 | 2.51 | 3.25 |
03/31/16 | 2.51 | 2.90 |
06/30/16 | 2.66 | 2.98 |
09/30/16 | 2.98 | 3.07 |
12/31/16 | 2.55 | 3.05 |
03/31/17 | 2.78 | 3.00 |
06/30/17 | 2.85 | 3.06 |
For Fiscal Quarter Ended | Low Bid | High Bid |
09/30/18 | 2.82 | 3.24 |
12/31/18 | 2.99 | 4.00 |
03/31/19 | 3.50 | 4.50 |
06/30/19 | 3.88 | 4.75 |
09/30/19 | 4.00 | 6.88 |
12/31/19 | 6.01 | 9.10 |
03/31/20 | 6.56 | 10.20 |
06/30/20 | 5.55 | 10.61 |
Name and Principal Position (a) | Fiscal Year (b) | Salary ($) (c) | Bonus ($) (d) | Stock Awards ($) (e) | Option Awards ($) (f) | Non- Equity Incentive Plan Comp- ensation ($) (g) | Non- Qualified Deferred Compensation Earnings ($) (h) | Changes in Pension Value and Non-Qualified Deferred Compensation Earnings | All Other Comp- ensation ($) (i) | Total ($) (j) |
Helena R. Santos, CEO, President, CFO | 2017 | 162,000 | 20,000 | 0 | 0 | 0 | 0 | 0 | 6,500(1) | 188,500 |
2016 | 157,100 | 0 | 0 | 0 | 0 | 0 | 0 | 6,300(1) | 163,400 | |
Brookman P. March, Vice President Corporate Strategy, VP, Sales of Altamira | 2017 | 147,000 | 10,000 | 0 | 500(2) | 0 | 0 | 0 | 5,900(1) | 163,400 |
2016 | 142,800 | 0 | 0 | 1,200(2) | 0 | 0 | 0 | 5,700(1) | 149,700 | |
Robert P. Nichols, President of Genie Division and Corporate Secretary | 2017 | 146,000 | 10,000 | 0 | 500(2) | 0 | 0 | 0 | 5,800(1) | 162,300 |
2016 | 141,800 | 0 | 0 | 1,200(2) | 0 | 0 | 0 | 5,700(1) | 148,700 | |
Karl D. Nowosielski President of Torbal Division and Director of Marketing | 2017 | 143,000 | 10,000 | 0 | 1,200(3) | 0 | 0 | 0 | 5,700(1) | 159,900 |
2016 | 141,900 | 0 | 0 | 9,500(3) | 0 | 0 | 0 | 5,700(1) | 157,100 |
Name and Principal Position (a) | Fiscal Year (b) | Salary ($) (c) | Bonus ($) (d) | Stock Awards ($) (e) | Option Awards ($) (f) | Non- Equity Incentive Plan Compensation ($) (g) | Non- Qualified Deferred Compensation Earnings ($) (h) | Changes in Pension Value and Non-Qualified Deferred Compensation Earnings | All Other Compensation ($) (i) | Total ($) (j) |
Helena R. Santos, CEO, President, CFO | 2020 | 185,700 | 50,000 | 0 | 13,100(1) | 0 | 0 | 0 | 9,400(6) | 258,200 |
Helena R. Santos, CEO, President, CFO | 2019 | 180,300 | 0 | 0 | 13,100(1) | 0 | 0 | 0 | 4,900(6) | 198,300 |
John A. Moore, President of SBI | 2020 | 145,000 | 50,000 | 0 | 36,000(2) | 0 | 0 | 0 | 28,900(7) | 259,900 |
John A. Moore, President of SBI | 2019 | 40,000 | 0 | 0 | 12,000(2) | 0 | 0 | 0 | 9,800(7) | 61,800 |
Anthony Mitri, President of Altamira | 2020 | 130,000 | 0 | 0 | 6,500(3) | 0 | 0 | 0 | 5,200(6) | 141,700 |
Anthony Mitri, President of Altamira | 2019 | 120,000 | 0 | 0 | 6,500(3) | 0 | 0 | 0 | 4,800(6) | 131,300 |
Robert P. Nichols, President of Genie Division | 2020 | 162,300 | 5,000 | 0 | 3,900(4) | 0 | 0 | 0 | 6,700(6) | 177,900 |
Robert P. Nichols, President of Genie Division | 2019 | 157,600 | 0 | 0 | 3,900(4) | 0 | 0 | 0 | 6,800(6) | 168,300 |
Karl D. Nowosielski President of Torbal Division and Director of Marketing | 2020 | 169,800 | 10,000 | 0 | 6,300(5) | 0 | 0 | 0 | 7,200(6) | 193,300 |
Karl D. Nowosielski President of Torbal Division and Director of Marketing | 2019 | 163,300 | 10,000 | 0 | 7,400(5) | 0 | 0 | 0 | 6,400(6) | 187,100 |
Name (a) | Grant Date (b) | Estimated Future Payouts Under Non-Equity Incentive Plan $ (c) | Estimated Future Payouts Under Equity Incentive Plan $ (d) | All Other Stock Awards: Number Of Shares Of Stock Or Units (#) (e) | All Other Option Awards: Number Of Securities Underlying Options (#) (f) | Exercise Or Base Price Of Option Awards ($/Sh) (g) | Grant Date Fair Value of Stock And Option Awards (h) | Grant Date (b) | Estimate Future Payouts Under Non-Equity Incentive Plan $ (c) | Estimated Future Payouts Under Equity Incentive Plan $ (d) | All Other Stock Awards Number Of Shares Of Stock Or Units (#) (e) | All Other Option Awards: Number Of Securities Underlying Options (#) (f) | Exercise Or Base Price Of Option Awards ($/Sh) (g) | Grant Date Fair Value of Stock And Option Awards (h) |
Karl D. Nowosielski | 02/26/17 | 0 | 0 | 6,000 | 2.91 | 10,500 | ||||||||
John A. Moore | 07/01/19- 06/30/20 | 0 | 5,881 | 5.35-11.30 | 36,000 |
Option Awards | |||||
Name (a) | Number of Securities Under- lying Unexercised Options (#) Exercisable (b) | Number of Securities Under- lying Unexercised Options (#) Unexerci- sable (c) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (d) | Option Exercise Price ($) (e) | Option Expiration Date (f) |
Brookman P. March | 7,000 | 0 | 0 | 3.71-3.96 | 05/2022-12/2023 |
Robert P. Nichols | 2,000 | 0 | 0 | 3.50 | 12/2023 |
Karl D. Nowosielski | 6,333 | 10,667 | 0 | 3.05-4.05 | 02/2024-02/2027 |
Option Awards | |||||
Name (a) | Number of Securities Underlying Unexercised Options (#) Exercisable (b) | Number of Securities Underlying Unexercised Options (#) Unexercisable (c) | Equity Incentive Plan Awards Number of Securities Underlying Unexercised Unearned Options (#) (d) | Option Exercise Price ($) (e) | Option Expiration Date (f) |
Helena Santos | 8,666 | 8,334 | 0 | 3.08 | 07/2027 |
Anthony Mitri | 6,668 | 3,332 | 0 | 3.05-3.15 | 12/2027-06/2028 |
John A. Moore | 1,902 | 10,684 | 0 | 4.50-11.30 | 03/2029-06/2030 |
Robert Nichols | 5,000 | 2,500 | 0 | 3.08 | 12/2023-07/2027 |
Karl Nowosielski | 22,000 | 2,500 | 0 | 3.05-4.05 | 02/2024-07/2027 |
Name(a) | Fees Earned or Paid in Cash ($) (b) | Stock Awards ($) (c) | Option Awards($) (d) | Non-Equity Incentive Plan Comp-ensation ($) (e) | Changes in Pension Value and Non-qualified Deferred Compens-ation Earnings($) (f) | Non-qualified Deferred Comp-ensation Earnings ($) (g) | All Other Comp- ensation ($) (h) | Total ($) (i) |
Joseph G.Cremonese | 35,900 | 0 | 0 | 0 | 0 | 0 | 43,200(1) | 79,100 |
Roger B. Knowles (3) | 4,000 | 0 | 0 | 0 | 0 | 0 | 0 | 4,000 |
Grace S.Morin | 18,100 | 0 | 0 | 0 | 0 | 0 | 5,200(2) | 23,300 |
James S.Segasture | 18,100 | 0 | 0 | 0 | 0 | 0 | 00 | 18,100 |
John F.F. Watkins (3) | 7,600 | 0 | 0 | 0 | 0 | 0 | 0 | 7,600 |
Name (a) | Fees Earned or Paid in Cash ($) (b) | Stock Awards ($) (c) | Option Awards ($) (d) | Non-Equity Incentive Plan Comp- Ensation ($) (e) | Changes in Pension Value and Non-qualified Deferred Compensation Earnings ($) (f) | Non-qualified Deferred Comp-sensation Earnings ($) (g) | All Other Comp- ensation ($) (h) | Total ($) (i) |
Joseph G. Cremonese | 36,700 | 0 | 0 | 0 | 0 | 0 | 76,200(1) | 112,900 |
Marcus Frampton | 24,800 | 0 | 0 | 0 | 0 | 0 | 0 | 24,800 |
John A. Moore (2) | ||||||||
Grace S. Morin | 6,400 | 0 | 0 | 0 | 0 | 0 | 8,400(3) | 14,800 |
James S. Segasture | 16,800 | 0 | 0 | 0 | 0 | 0 | 0 | 16,800 |
John F.F. Watkins | 24,800 | 0 | 0 | 0 | 0 | 0 | 0 | 24,800 |
Name | Amount and Nature of Beneficial Ownership | % of Class |
Roy T. Eddleman Trustee c/o Troy Gould PC 1801 Century Park East, Ste. 1600 Los Angeles, CA 90067 | 124,736 (1) | 8.3% 8.3% |
Fulcrum, Inc. 100 Delawanna Avenue Clifton, NJ 07014 | 117,370 (2) | 7.9% |
Joseph G. Cremonese | 138,262 (3) | 9.2% |
Brookman P. March | 89,950 (4) | 6.0% |
Grace S. Morin | 89,950 (5) | 6.0% |
Robert P. Nichols | 20,397 (6) | 1.4% |
Karl D. Nowosielski | 26,683 (7) | 1.8% |
Helena R. Santos | 15,779 | 1.1% |
James S. Segasture | 162,500 (8) | 10.9% |
John F. F. Watkins | 0 | 0.0% |
All directors and executive officers as a group (7 persons) | 453,571 (9) | 29.7% |
Name | Amount and Natureof Beneficial Ownership | % of Class |
Roy T. Eddleman, Trustee, Roy T. Eddleman Trust UAD 8-7-2000 Troy Gould PC 1801 Century Park East Suite 1600 Los Angeles, CA 900067 | 1,495,686(1) | 42.2% |
Christopher Cox One World Financial Center New York, NY 10281 | 444,000(2) | 14.4% |
Lyon Polk 1585 Broadway 22ndFloor New York, NY 10036 | 444,000(3) | 14.4% |
Joseph G. Cremonese | 136,062(4) | 4.7% |
Marcus Frampton | 81,812(5) | 2.9% |
John A. Moore | 34,786(6) | 1.2% |
Helena R. Santos | 38,252(7) | 1.3% |
John F. F. Watkins | 0 | (*) |
Karl D. Nowosielski | 34,183(8) | 1.2% |
Anthony J. Mitri | 10,000(9) | (*) |
Robert P. Nichols | 27,085(10) | 1.0% |
All directors and executive officers as a group (8 persons) | 362,180(11) | 12.2% |
(1)Based upon form Schedule 13D filed with the Securities and Exchange Commission (“SEC”) on June 24, 2020. Includes 683,850 shares issuable upon exercise of warrants. |
(2) Based upon from Schedule 13D filed with the SEC on June 29, 2020. Includes 222,000 shares issuable upon exercise of warrants. |
(3) Based upon form Schedule 13G filed with the SEC on July 9, 2020. Includes 222,000 shares issuable upon exercise of warrants. |
(4) 126,262 shares are owned jointly with his wife, 7,000 shares are owned by his wife, and 5,000 shares are issuable upon exercise of options. |
(5) 2,250 shares are owned by Mr. Frampton. Mr. Frampton has voting power over 77,085 shares. |
(6) Includes 12,586 shares issuable upon exercise of options. |
(7) Includes 17,000 shares issuable upon exercise of options. |
(8) Includes 9,683 stock issued in connection with the acquisition of the Torbal Division in February 2014. |
(9) Represents shares issuable upon exercise of options. |
(10) Includes 7,500 shares issuable upon exercise of options. |
(11) Includes 96,586 shares issuable upon exercise of options. |
(*) - % of Class is less than 1%. |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights ($) (b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a) (c) |
Equity Compensation plans approved by security holders | 96,600 | 4.35 | 147,400 |
Equity Compensation plans not approved by security holders | N/A | N/A | N/A |
Total | 96,600 | 4.35 | 147,400 |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights ($) (b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) |
Equity Compensation plans approved by security holders | 34,500 | 3.25 | 83,500 |
Equity Compensation plans not approved by security holders | N/A | N/A | N/A |
Total | 34,500 | 3.25 | 83,500 |
Exhibit Number | Exhibit |
3 | Articles of Incorporation and By-Laws: |
3(a) | Certificate of Incorporation of the Company as amended (filed as Exhibit 1(a-1) to the Company's General Form for Registration of Securities on Form 10 dated February 14, 1973 and incorporated by reference thereto.) |
3(b) | Certificate of Amendment of the Company’s Certificate of Incorporation, as filed on January 28, 1985 (filed as Exhibit 3(a) to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 1985 and incorporated by reference thereto.) |
By-Laws of the Company, as restated and amended (filed as Exhibit 3(ii) to the Company’s Current Report on Form 8-K filed on January 6, 2003 and Exhibit 3(ii) to the Company’s Current Report on Form 8-K filed on December 5, 2007 and incorporated by reference thereto). | |
Second Amended and Restated By-Laws of Scientific Industries, Inc. (filed as Exhibit 3.2 to the Company’s Current Report on Form 8-K filed on August 10, 2020 and incorporated by reference thereto). | |
4 | Instruments defining the rights of security holders: |
2002 Stock Option Plan (filed as Exhibit 99-1 to the Company’s Current Report on Form 8-K filed on November 25, 2002 and incorporated by reference thereto). | |
2012 Stock Option Plan (filed as Exhibit 10 to the Company’s Current Report on Form 8-K filed on January 23, 2012 and incorporated by reference thereto). | |
Amendment to the Company’s 2012 Stock Option Plan (Filed as Exhibit 4(c) to the Company’s Quarterly Report on Form 10-Q filed on May 12, 2016 and incorporated by reference thereto). 4(d) Form of Warrant issued by the Company to Investors (Filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on June 19, 2020, and incorporated by reference thereto). | |
10 | Material Contracts: |
Lease between Registrant and AIP Associates, predecessor-in-interest of current lessor, dated October, 1989 with respect to Company's offices and facilities in Bohemia, New York (filed as Exhibit 10(a) to the Company’s Annual Report on Form 10-KSB filed on September 28, 2005 and incorporated by reference thereto). | |
Amendment to lease between Registrant and REP A10 LLC, successor in interest of AIP Associates, dated September 1, 2004 (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on September 2, 2004, and incorporated by reference thereto). | |
Second amendment to lease between Registrant and REP A10 LLC dated November 5, 2007 (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on November 8, 2007, and incorporated by reference thereto). | |
Lease agreement dated August 8, 2014 by and between the Company and 80 Orville Drive Associates LLC. | |
Employment Agreement dated January 1, 2003, by and between the Company and Ms. Santos (filed as Exhibit 10(a) to the Company’s Current Report on Form 8-K filed on January 22, 2003, and incorporated by reference thereto). | |
Employment Agreement dated September 1, 2004, by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on September 1, 2004, and incorporated by reference thereto). | |
Employment Agreement dated December 29, 2006, by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on December 29, 2006, and incorporated by reference thereto). |
Employment Agreement dated July 31, 2009 by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on August 7, 2009, and incorporated by reference thereto). | |
Employment Agreement dated May 14, 2010 by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on May 18, 2010, and incorporated by reference thereto). | |
Employment Agreement dated September 13, 2011 by and between the Company and Ms. Santos (filed as exhibit 10(b)-5 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2011, and incorporated by reference thereto). | |
Amended Employment Agreement dated May 20, 2013 by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on May 20, 2013, and incorporated by reference thereto). | |
Agreement extension dated June 9, 2015 to amend employment agreement by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on June 9, 2015, and incorporated by reference thereto) | |
Agreement extension dated May 25, 2016 to amend employment agreement by and between the Company and Ms. Santos (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on May 31, 2016, and incorporated by reference thereto). | |
Employment agreement dated July 1, 2017 by and between the Company and Ms. Santos (filed as an exhibit |
Employment Agreement dated January 1, 2003, by and between the Company and Mr. Robert P. Nichols (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on January 22, 2003, and incorporated by reference thereto). | |
Employment Agreement dated September 1, 2004, by and between the Company and Mr. Nichols (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on September 1, 2004, and incorporated by reference thereto). | |
Employment Agreement dated July 31, 2009 by and between the Company and Mr. Nichols (filed as Exhibit 10A-2 to the Company’s Current Report on Form 8-K filed on August 7, 2009, and incorporated by reference thereto). | |
Employment Agreement dated September 13, 2011 by and between the Company and Mr. Nichols (filed as Exhibit 10(c)-5 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2011, and incorporated by reference thereto). | |
Amended Employment Agreement dated May 20, 2013 by and between the Company and Mr. Nichols (filed as Exhibit 10A-2 to the Company’s current Report on Form 8-K filed on May 20, 2013, and incorporated by reference thereto). | |
Agreement extension dated June 9, 2015 to amend employment agreement with Mr. Nichols (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on June 9, 2015, and incorporated by reference thereto). | |
Agreement e Agreement extension dated May 25, 2016 to amend employment agreement with Mr. Nichols (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on May 31, 2016, and incorporated by reference thereto). |
Employment agreement dated July 1, 2017 by and between the Company and Mr. Nichols (filed as an exhibit | |
Consulting Agreement dated January 1, 2003 by and between the Company and Mr. Cremonese and his affiliate, Laboratory Innovation Company, Ltd. (filed as Exhibit 10(b) to the Company’s Current Report on Form 8-K filed on January 6, 2003, and incorporated by reference thereto). | |
Amended and Restated Consulting Agreement dated March 22, 2005, by and between the Company and Mr. Cremonese and Laboratory Innovation Company, Ltd. (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on March 23, 2005, and incorporated by reference thereto). | |
Second Amended and Restated Consulting Agreement dated March 15, 2007, by and between the Company and Mr. Cremonese and Laboratory Innovation Company Ltd. (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on March 16, 2007, and incorporated by reference thereto). | |
Third Amended and Restated Consulting Agreement dated September 23, 2009, by and between the Company and Mr. Cremonese and Laboratory Innovation Company, Ltd. (filed as Exhibit 10 to the Company’s Annual Report on Form 10-K field on September 24, 2009, and incorporated by reference thereto). | |
Fourth Amended and Restated Consulting Agreement dated January 7, 2011 (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K (filed on January 18, 2011, and incorporated by reference |
Fifth Amendment and Restated Consulting Agreement dated January 20, 2012 (filed as Exhibit 10 to the Company’s Current Report on Form 8-K (filed on January 23, 2012, and incorporated by reference thereto). | ||
Agreement extension dated November 29, 2012 to Amended and Restated Consulting Agreement (filed as Exhibit 10 to the Company’s Current Report on Form 8-K filed on December 4, 2012, and incorporated by reference thereto). | ||
Agreement extension dated December 12, 2013 to Amended and Restated Consulting Agreement (filed as Exhibit 10 to the Company’s Current Report on Form 8-K filed on December 12, 2013, and incorporated by reference thereto). | ||
Agreement extension dated January 14, 2015 to Amended and Restated Consulting Agreement by and between the Company and Mr. Cremonese and affiliates (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on January 15, 2015, and incorporated with reference thereto). | ||
Agreement extension dated January 7, 2016 to Amended and Restated Consulting Agreement by and between the Company and Mr. Cremonese and affiliates (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on January 26, 2016, and incorporated with reference thereto). | ||
Agreement extension dated February 16, 2018 to Amended and Restated Consulting Agreement by and between the Company and Mr. Cremonese and affiliates (filed as Exhibit 10-A1 to the Company’s Current Report on Form 8-K filed on March 9, 2018, and incorporated with reference thereto). | ||
Agreement extension dated January 23, 2019 to Amended and Restated Consulting Agreement by and between the Company and Mr. Cremonese and affiliates (filed as Exhibit 10-1 to the Company’s Current Report on Form 8-K filed on January 25, 2019, and incorporated with reference thereto). | ||
10(d)-12 | Monthly Retainer Agreement between Scientific Bioprocessing, Inc. and Mr. Cremonese and affiliates (filed as Exhibit 10(d)-12 to the Company’s Quarterly Report on Form 10-Q on February 13, 2020, and incorporated by reference thereto). | |
Sublicense from Fluorometrix Corporation (filed as Exhibit 10(a)1 to the Company’s Current Report on Form 8-K filed on June 14, 2006, and incorporated by reference thereto). | ||
Stock Purchase Agreement, dated as of November 30, 2006, by and among the Company and Grace Morin, Heather H. Haught and William D. Chandler (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on December 5, 2006, and incorporated by reference thereto). | ||
Escrow Agreement, dated as of November 30, 2006, by and among the Company and Grace Morin, Heather H. Haught and William D. Chandler (filed as Exhibit 10(a) to the Company’s Current Report on Form 8-K filed on December 5, 2006, and incorporated by reference thereto). |
Registration Rights Agreement, dated as of November 30, 2006, by and among the Company and Grace Morin, Heather H. Haught and William D. Chandler (filed as Exhibit 10(b) to the Company’s Current Report on Form 8-K filed on December 5, 2006, and incorporated by reference thereto). | ||
Employment Agreement, dated as of November 30, 2006, between Altamira Instruments, Inc. and Brookman P. March (filed as Exhibit 10(c) to the Company’s Current Report on Form 8-K filed on December 5, 2006, and incorporated by reference thereto). | ||
Employment Agreement, dated as of October 30, 2008, between Altamira Instruments, Inc. and Brookman P. March (filed as Exhibit 10A-2 to the Company’s Current Report on Form 8-K filed on October 30, 2008, and incorporated by reference thereto). |
Employment Agreement, dated as of October 1, 2010, between Altamira Instruments, Inc., and Brookman P. March (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on October 13, 2010, and incorporated by reference thereto). | ||
Employment Agreement, dated as of May 18, 2012 between Altamira Instruments, | ||
Agreement Extension, dated as of May 21, 2014 between Altamira Instruments, Inc. and Brookman P. March (filed as Exhibit 10 to the Company’s Current Report on Form 8-K filed on May 21, 2014, and incorporated by reference thereto). | ||
Agreement extension dated June 9, 2015 to amend employment agreement (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on June 9, 2015, and incorporated by reference thereto). | ||
Agreement extension dated May 25, 2016 to amend employment agreement (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on May 31, 2016, and incorporated by reference thereto). | ||
Employment agreement dated July 1, 2017 by and between the Company and Mr. March (filed as an exhibit | ||
10(i)-8 | Termination notice dated February 14, 2020 to Mr. March (filed as Exhibit 10(I-8) to the Company’s Current Report on Form 8-K filed on February 18, 2020, and incorporated by reference thereto). | |
Indemnity Agreement, dated as of April 13, 2007 by and among the Company and Grace Morin, Heather H. Haught and William D. Chandler (filed as Exhibit 10(j) to the Company’s Annual Report on Form 10-KSB filed on September 28, 2007 and incorporated by reference thereto). | ||
Lease between Altamira Instruments, Inc. and Allegheny Homes, LLC, with respect to the Company’s Pittsburgh, Pennsylvania facilities (filed as Exhibit 10(k) to the Company’s Annual Report on Form 10-KSB filed on September 28, 2007 and incorporated by reference thereto). |
Lease between Altamira Instruments, Inc. and Allegheny Homes, LLC, with respect to the Company’s Pittsburgh, Pennsylvania facilities (filed as Exhibit 10(k)-1 to the Company’s Quarterly Report on Form 10-Q filed on February 14, 2013, and incorporated by reference thereto). | |
Line of Credit Agreements dated October 30, 2008, by and among the Company and Capital One, N.A. (filed as Exhibits 10-A1(a) through (f) to the Company’s Current Report on Form 8-K filed on October 30, 2008, and incorporated by reference thereto. | |
Restated Promissory Note Agreement dated January 20, 2010 by and among the Company and Capital One N.A. (filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on January 20, 2010, and incorporated by reference thereto). | |
Consulting Agreement dated April 1, 2009 by and between the Company and Grace Morin (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on April 1, 2009, and incorporated by reference thereto). | |
Agreement dated January 12, 2015 to extend Consulting Agreement (filed as Exhibit 10A-2 to the Company’s Current Report on Form 8-K filed on January 15, 2015, and incorporated by reference thereto). | |
Agreement dated January 7, 2016 to extend Consulting Agreement (filed as Exhibit 10A-2 to the Company’s Current Report on Form 8-K filed on January 26, 2016, and incorporated by reference thereto). | |
Agreement dated February 16, 2018 to extend Consulting Agreement (filed as Exhibit 10A-2 to the Company’s Current Report on Form 8-K filed on March 9, 2018, and incorporated by reference thereto). | |
Agreement dated January 23, 2019 to extend Consulting Agreement (filed as Exhibit 10-2 to the Company’s Current Report on Form 8-K filed on January 25, 2019, and incorporated by reference thereto). | |
Line of Credit Agreements dated June 14, 2011, by and among the Company and JPMorgan Chase Bank, N.A. (filed as Exhibits 99.1 through 99.3 to the Company’s Current Report on Form 8-K filed on June 16, 2011, and incorporated by reference thereto). | |
Promissory Note dated June 5, 2013 by and among the Company and JP Morgan Chase Bank, N.A. (filed as Exhibit 99 to the Company’s Current Report on Form 8-K filed on June 7, 2013, and incorporated by reference thereto). | |
Purchase Agreement, dated as of November 14, 2011, by and among the Company, Scientific Bioprocessing, Inc., and Fluorometrix Corporation (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on November 17, 2011, and incorporated by reference thereto). |
Escrow Agreement, dated as of November 14, 2011, by and among the Company, Scientific Bioprocessing, Inc., and Fluorometrix Corporation (filed as Exhibit 10(A) to the Company’s Current Report on Form 8-K filed on November 17, 2011, and incorporated by reference thereto). | |
Research and Development Agreement dated as of November 14, 2011, by and between Scientific Bioprocessing, Inc. and Biodox R&D Corporation (filed as Exhibit 10(B) to the Company’s Current Report on Form 8-K filed on November 17, 2011, and incorporated by reference thereto). |
Notice of termination of Research and Development Agreement dated June 12, 2013 (filed as Exhibit 99 to the Company’s Current Report on Form 8-K filed on June 27, 2013, and incorporated by reference thereto) | |
Non-Competition Agreement, dated as of November 14, 2011, by and among the Company, Scientific Bioprocessing, Inc., and Joseph E. Qualitz (filed as Exhibit 10(D) to the Company’s Current Report on Form 8-K filed on November 17, 2011, and incorporated by reference thereto). | |
Promissory Note, dated as of November 14, 2011, by and between the Company and the University of Maryland, Baltimore County (filed as Exhibit 10(c) to the Company’s Current Report on Form 8-K filed on November 17, 2011, and incorporated by reference thereto). | |
License Agreement, dated as of January 31, 2001 by and between University of Maryland, Baltimore County and Fluorometrix Corporation (filed as Exhibit 10(E) to the Company’s Current Report on Form 8-K filed on November 21, 2011, and incorporated by reference thereto). | |
Line of Credit Agreements dated June 25, 2014, by and among the Company and Bank of America Merrill Lynch (filed as Exhibits 99.1 through 99.2 (to the Company’s Current Report on Form 8-K filed on July 2, 2014, and incorporated by reference thereto). | |
Asset Purchase Agreement, dated as of February 26, 2014, by and among the Company and Fulcrum, Inc. (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on February 28, 2014, and incorporated by reference thereto). | |
Escrow Agreement, dated as of February 26, 2014, by and among the Company, and Fulcrum, Inc. (filed as Exhibit 10(e) to the Company’s Current Report on Form 8-K filed on February 28, 2014, and incorporated by reference thereto). | |
Non-Competition Agreements, dated as of February 26, 2014, by and among the Company, and James Maloy and Karl Nowosielski (filed as Exhibits 10(b) and 10(c) to the Company’s Current Report on Form 8-K filed on February 28, 2014, and incorporated by reference thereto). | |
Registration Rights |
Supply Agreement, dated as of February 20, 2014, by and among the Company, and Axis Sp 3.O.O. (filed as Exhibit 10(g) to the Company’s Current Report on Form 8-K filed on February 28, 2014, and incorporated by reference thereto). | |
Line of Credit Agreements dated June 26, 2015, by and among the Company and First National Bank of Pennsylvania (filed as Exhibit 10.1 through 10.4 to the Company’s Current Report on Form 8-K filed on June 30, 2015, and incorporated by reference thereto). | |
Commercial Security Agreement dated July 5, 2016 by and among the Company, and First National Bank of Pennsylvania. | |
Note Purchase Agreements with James Maloy dated May 7, 2015 (filed as Exhibit 10.6 to the Company’s Current Report on Form 8-K filed on June 30, 2015, and incorporated by reference thereto). | |
Note Purchase Agreements with Grace March dated May 19, 2015 (filed as Exhibit 10.6 to the Company’s Current Report on Form 8-K filed on June 30, 2015, and incorporated by reference thereto). |
10(aa)-1 | Amendment to Consulting Agreement dated November 7, 2019 between the Company and Mr. John A. Moore (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 11, 2019, and incorporated by reference thereto). |
10(aa)-2 | Employment Agreement dated July 1, 2020 between Scientific Bioprocessing, Inc. and John A. Moore (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 25, 2020, and incorporated by reference thereto). |
Consulting Agreement dated July 20, 2020 between the Company and Mr. Reinhard Vogt and his affiliate Societat Reinhard and Noah Vogt AG (filed as Exhibit 10A-1 to the Company’s Current Report on Form 8-K filed on July 22, 2020, and incorporated by reference thereto.) | |
10(cc) | Employment Agreement dated July 1, 2020 between Scientific Bioprocessing, Inc. and James Polk (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 25, 2020, and incorporated by reference thereto). |
10(dd) | Securities Purchase Agreement dated June 18, 2020 between the Company and Investors (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 19, 2020, and incorporated by reference thereto). |
10(ee) | Loan Agreement under the U.S. Small Business Administration Paycheck Protection Program dated April 14, 2020 between the Company and First National Bank (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 21, 2020, and incorporated by reference thereto). |
Code of Ethics (filed as Exhibit 14 to the Company’s Annual 10KSB filed on September 28, 2007 and incorporated by reference thereto). | |
21 | Subsidiaries of the Registrant |
Altamira Instruments, Inc., a Delaware Corporation, is a wholly-owned subsidiary of the Company. | |
Scientific Bioprocessing, Inc., a Delaware Corporation, is a wholly-owned subsidiary of the Company since November 2011. | |
Scientific Packaging Industries, Inc., a New York corporation, is a wholly-owned inactive subsidiary of the Company. | |
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002. | |
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of | |
2002. |
Date: | SCIENTIFIC INDUSTRIES, INC. (Registrant) /s/Helena R. Santos | |
Helena R. Santos President, Chief Executive Officer, Chief Financial Officer and |
Name | Title | Date |
Helena R. Santos | President, Chief Executive Officer, Chief Financial Officer and Treasurer | October 09, 2020 |
Joseph G. Cremonese | Director | October 09, 2020 |
Marcus Frampton | Director | October 09, 2020 |
John A. Moore | Chairman of the Board | October 09, 2020 |
Reinhard Vogt | Director | October 09, 2020 |
John F.F. Watkins | Director | October 09, 2020 |
Page | |
Report of independent registered public accounting firm | F-1 |
Consolidated financial statements: | |
Balance sheets | F-2 |
Statements of operations | F-3 |
Statements of | |
Statements of cash flows | |
Notes to financial statements |
2017 | 2016 | 2020 | 2019 | |
Current assets: | ||||
Cash and cash equivalents | $1,025,100 | $1,245,000 | $7,559,700 | $1,602,500 |
Investment securities | 295,500 | 290,100 | 331,800 | 330,900 |
Trade accounts receivable, less allowance for doubtful accounts of $11,600 in 2017 and 2016 | 1,424,400 | 1,231,900 | ||
Trade accounts receivable, less allowance for doubtful accounts of $11,600 and $15,000, respectively | 1,064,000 | 1,974,200 | ||
Inventories | 1,961,200 | 2,412,100 | 2,884,700 | 2,592,300 |
Income tax receivable | 334,800 | - | ||
Prepaid expenses and other current assets | 80,300 | 47,200 | 112,300 | 91,200 |
Deferred taxes | 129,000 | 140,600 | ||
Total current assets | 4,915,500 | 5,366,900 | 12,287,300 | 6,591,100 |
Property and equipment, net | 199,300 | 251,100 | 279,700 | 318,800 |
Intangible assets, net | 579,000 | 897,600 | 128,700 | 175,000 |
Goodwill | 705,300 | 705,300 | 705,300 | 705,300 |
Operating lease right-of-use assets | 803,300 | - | ||
Other assets | 52,500 | 52,500 | 56,000 | 54,700 |
Deferred taxes | 376,100 | 275,900 | 537,100 | 431,100 |
Total assets | $6,827,700 | $7,549,300 | $14,797,400 | $8,276,000 |
Current liabilities: | ||||
Accounts payable | $139,200 | $342,400 | $354,700 | $569,000 |
Accrued expenses and taxes, current portion | 491,000 | 849,700 | ||
Accrued expenses and taxes | 799,700 | 608,300 | ||
Contract liabilities | 89,000 | - | ||
Contingent consideration, current portion | 175,700 | 136,500 | 111,000 | 268,000 |
Notes payable, current portion | 6,700 | 6,400 | ||
Bank overdraft | 43,100 | 140,000 | ||
Lease liabilities, current portion | 226,900 | - | ||
Payroll Protection Program loan | 563,800 | - | ||
Total current liabilities | 812,600 | 1,335,000 | 2,188,200 | 1,585,300 |
Accrued expenses, less current portion | 60,000 | 60,000 | ||
Notes payable, less current portion | 5,800 | 12,500 | ||
Lease liabilities, less current portion | 640,800 | - | ||
Contingent consideration payable, less current portion | 121,300 | 209,800 | 247,000 | 350,000 |
Total liabilities | 999,700 | 1,617,300 | 3,076,000 | 1,935,300 |
Shareholders’ equity: | ||||
Common stock, $.05 par value; authorized 7,000,000 shares; issued 1,513,914 shares in 2017 and 1,508,914 shares in 2016 | 75,700 | 75,400 | ||
Stockholders’ equity: | ||||
Common stock, $.05 par value; 7,000,000 shares authorized; 2,881,065 and 1,513,914 shares issued; 2,861,263 and 1,494,112 shares outstanding in 2020 and 2019, respectively | 144,100 | 75,700 | ||
Additional paid-in capital | 2,515,900 | 2,498,500 | 8,608,300 | 2,592,700 |
Accumulated other comprehensive income (loss) | (3,500) | 900 | ||
Retained earnings | 3,292,300 | 3,409,600 | 3,021,400 | 3,724,700 |
5,880,400 | 5,984,400 | 11,773,800 | 6,393,100 | |
Less common stock held in treasury at cost, 19,802 shares | 52,400 | 52,400 | 52,400 | 52,400 |
Total shareholders’ equity | 5,828,000 | 5,932,000 | ||
Total stockholders’ equity | 11,721,400 | 6,340,700 | ||
Total liabilities and shareholders’ equity | $6,827,700 | $7,549,300 | ||
Total liabilities and stockholders’ equity | $14,797,400 | $8,276,000 |
2017 | 2016 | 2020 | 2019 | |
Revenues | $8,149,300 | $9,597,600 | $8,570,300 | $10,199,800 |
Cost of revenues | 5,270,000 | 5,680,300 | 4,716,900 | 5,832,700 |
Gross profit | 2,879,300 | 3,917,300 | 3,853,400 | 4,367,100 |
Operating expenses: | ||||
General and administrative | 1,665,400 | 1,695,200 | 2,412,300 | 1,924,400 |
Selling | 888,800 | �� 1,415,400 | 1,436,400 | 1,136,100 |
Research and development | 437,500 | 349,000 | 1,140,000 | 530,500 |
Impairment of intangible assets | 48,000 | 212,700 | ||
Total operating expenses | 3,039,700 | 3,672,300 | 4,988,700 | 3,591,000 |
Income (loss) from operations | (160,400) | 245,000 | (1,136,300) | 776,100 |
Other income (expense): | ||||
Interest income | 10,600 | 6,000 | 12,600 | 3,400 |
Other income, net | 5,900 | 1,800 | ||
Other income (expense), net | (16,200) | (7,800) | ||
Interest expense | (2,900) | (33,900) | - | (1,500) |
Total other income (expense), net | 13,600 | (26,100) | (3,600) | (5,900) |
Income (loss) before income tax expense (benefit) | (146,800) | 218,900 | (1,139,900) | 770,200 |
Income tax expense (benefit): | ||||
Current | 13,400 | 202,500 | - | 166,600 |
Deferred | (87,600) | (149,200) | (436,600) | (42,000) |
Total income tax expense (benefit) | (74,200) | 53,300 | (436,600) | 124,600 |
Net income (loss) | $(72,600) | $165,600 | $(703,300) | $645,600 |
Basic earnings (loss) per common share | $(.05) | $.11 | $(.46) | $.43 |
Diluted earnings (loss) per common share | $(.05) | $.11 | $(.46) | $.43 |
Weighted average common shares outstanding, basic | 1,491,167 | 1,489,112 | ||
Weighted average common shares, basic | 1,515,103 | 1,494,112 | ||
Weighted average common shares outstanding, assuming dilution (in 2016) | 1,491,167 | 1,489,387 | ||
Weighted average common shares outstanding, assuming dilution (in 2019) | 1,515,103 | 1,512,178 |
2017 | 2016 | |
Net income (loss) | $(72,600) | $165,600 |
Other comprehensive income (loss): | ||
Unrealized holding gain (loss) | ||
arising during period, | ||
net of tax | (4,400) | 4,200 |
Comprehensive income (loss) | $(77,000) | $169,800 |
Additional | Accumulated Other | Total | ||||||
Common Stock | Paid-in | Comprehensive | Retained | Treasury Stock | Stockholders’ | |||
Shares | Amount | Capital | Income (Loss) | Earnings | Shares | Amount | Equity | |
Balance, July 1, 2018 | 1,513,914 | $75,700 | $2,545,900 | $1,200 | $3,131,800 | 19,802 | $52,400 | $5,702,200 |
Cumulative effect of the adoption of Accounting Standards Update (“ASU”) 2016-01 - Financial Instruments | - | - | - | (22,000) | 22,000 | - | - | - |
Net income | - | - | - | - | 645,600 | ��- | - | 645,600 |
Cash dividend declared and paid, $.05 | - | - | - | - | (74,700) | - | - | (74,700) |
Holding loss on investment securities, net of tax | - | - | - | 20,800 | - | - | - | 20,800 |
Stock-based compensation | - | - | 46,800 | - | - | - | - | 46,800 |
Balance, June 30, 2019 | 1,513,914 | 75,700 | 2,592,700 | - | 3,724,700 | 19,802 | 52,400 | 6,340,700 |
Net loss | - | - | - | - | (703,300) | - | - | (703,300) |
Issuance of Common Stock and Warrants, net of issuance costs (Note 15) | 1,349,850 | 67,500 | 5,936,900 | - | - | - | - | 6,004,400 |
Stock options exercised | 17,301 | 900 | 12,900 | - | - | - | - | 13,800 |
Stock-based compensation | - | - | 65,800 | - | - | - | - | 65,800 |
Balance, June 30, 2020 | 2,881,065 | $144,100 | $8,608,300 | $- | $3,021,400 | 19,802 | $52,400 | $11,721,400 |
Additional | Accumulated Other | Total | ||||||
Common Stock | Paid-in | Comprehensive | Retained | Treasury Stock | Shareholders’ | |||
Shares | Amount | Capital | Gain (Loss) | Earnings | Shares | Amount | Equity | |
Balance, July 1, 2015 | 1,508,914 | $75,400 | $2,486,700 | $(3,300) | $3,244,000 | 19,802 | $52,400 | $5,750,400 |
Net income | - | - | - | - | 165,600 | - | - | 165,600 |
Unrealized holding gain on investment securities, net of tax | - | - | - | 4,200 | - | - | - | 4,200 |
Stock-based compensation | - | - | 11,800 | - | - | - | - | 11,800 |
Balance, June 30, 2016 | 1,508,914 | 75,400 | 2,498,500 | 900 | 3,409,600 | 19,802 | 52,400 | 5,932,000 |
Net loss | (72,600) | (72,600) | ||||||
Cash dividend declared and paid $.03 | (44,700) | (44,700) | ||||||
Unrealized holding loss on investment securities, net of tax | (4,400) | (4,400) | ||||||
Exercise of stock options | 5,000 | 300 | 15,200 | 15,500 | ||||
Stock-based compensation | 2,200 | 2,200 | ||||||
Balance, June 30, 2017 | 1,513,914 | $75,700 | $2,515,900 | $(3,500) | $3,292,300 | 19,802 | $52,400 | $5,828,000 |
2017 | 2016 | |||
2020 | 2019 | |||
Operating activities: | ||||
Net income (loss) | $(72,600) | $165,600 | $(703,300) | $645,600 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
(Gain) loss on sale of investment securities | (4,400) | 13,200 | ||
Depreciation and amortization | 355,900 | 428,900 | 160,900 | 257,300 |
Impairment of intangible assets | 48,000 | 212,700 | ||
Gain on sale of property and equipment | - | (300) | ||
Deferred income tax benefit | (87,600) | (149,200) | ||
Gain on sale of investment securities | (3,200) | - | ||
Deferred income tax (benefit) expense | (106,000) | (38,500) | ||
Unrealized holding (gain) loss on investment securities | 12,400 | (3,000) | ||
Bad debt recovery | 3,400 | - | ||
Gain on sale of fixed assets | (300) | - | ||
Stock-based compensation | 2,200 | 11,800 | 65,800 | 46,800 |
Change in fair value of contingent consideration | 140,000 | 110,000 | 112,600 | 521,200 |
Changes in operating assets and liabilities: | ||||
Trade accounts receivable | (192,500) | (150,200) | 906,800 | (6,500) |
Inventories | 450,900 | (198,400) | (292,400) | (324,400) |
Prepaid and other current assets | (33,100) | 21,400 | ||
Income tax receivable | (334,800) | - | ||
Prepaid expenses and other assets | (22,400) | (60,100) | ||
Right-of-use assets | (803,300) | - | ||
Accounts payable | (203,200) | 114,800 | (214,400) | 141,000 |
Customer advances | - | (76,400) | ||
Lease liabilities | 867,700 | - | ||
Accrued expenses and taxes | (358,700) | 389,700 | 191,500 | (109,300) |
Contract liabilities | 89,000 | (63,800) | ||
Bank overdraft | (96,900) | 140,000 | ||
Total adjustments | 118,700 | 714,800 | 535,200 | 513,900 |
Net cash provided by operating activities | 46,100 | 880,400 | ||
Net cash (used in) provided by operating activities | (168,100) | 1,159,500 | ||
Investing activities: | ||||
Decrease in restricted cash | - | 300,000 | ||
Proceeds from sale of property and equipment | - | 3,000 | ||
Purchase of investment securities, available for sale | (18,700) | (2,700) | ||
Redemption of investment securities, available for sale | 11,100 | - | ||
Purchase of investment securities | (63,400) | (157,900) | ||
Redemption of investment securities | 55,000 | 151,900 | ||
Proceeds from sale of fixed assets | 1,000 | - | ||
Capital expenditures | (17,000) | (92,000) | (50,900) | (187,800) |
Purchase of other intangible assets | (16,500) | (13,900) | ||
Purchase of intangible assets | (25,800) | (24,600) | ||
Net cash provided by (used in) investing activities | (41,100) | 194,400 | ||
Net cash used in investing activities | (84,100) | (218,400) | ||
Financing activities: | ||||
Proceeds from notes | - | 20,000 | ||
Principal payments on notes payable | (6,400) | (201,000) | - | (5,800) |
Cash dividend paid | (44,700) | - | ||
Cash dividend declared and paid | - | (74,700) | ||
Proceeds from Payroll Protection Program loan | 563,800 | - | ||
Line of credit proceeds | 250,000 | 970,000 | - | 50,000 |
Issuance of common stock and warrants, net of issuance costs | 6,004,400 | - | ||
Line of credit repayments | (250,000) | (970,000) | - | (50,000) |
Proceeds from exercise of stock options | 13,800 | - | ||
Payments for contingent consideration | (189,300) | (130,800) | (372,600) | (311,200) |
Proceeds from exercise of stock options | 15,500 | - | ||
Net cash used in financing activities | (224,900) | (311,800) | ||
Net cash provided by (used in) financing activities | 6,209,400 | (391,700) | ||
Net increase in cash and cash equivalents | 5,957,200 | 549,400 | ||
Cash and cash equivalents, beginning of year | 1,602,500 | 1,053,100 | ||
Cash and cash equivalents, end of year | $7,559,700 | $1,602,500 | ||
Supplemental disclosures: | ||||
Cash paid during the period for: | ||||
Income taxes | $40,900 | $56,700 | ||
Interest | $- | $1,500 |
2017 | 2016 | |
Net increase (decrease) in cash and cash equivalents | (219,900) | 763,000 |
Cash and cash equivalents, beginning of year | 1,245,000 | 482,000 |
Cash and cash equivalents, end of year | $1,025,100 | $1,245,000 |
Supplemental disclosures: | ||
Cash paid during the period for: | ||
Income taxes | $213,500 | $34,500 |
Interest | 2,900 | 33,900 |
Benchtop Laboratory Equipment | Catalyst Research Instruments | Bioprocessing Systems | Corporate and Other | Consolidated | |
June 30, 2020: | |||||
Revenues | $6,783,600 | $785,900 | $1,000,800 | $- | $8,570,300 |
Foreign Sales | 2,589,800 | 586,500 | 1,000,400 | - | 4,176,700 |
Benchtop Laboratory Equipment | Catalyst Research Instruments | Bioprocessing Systems | Corporate and Other | Consolidated | |
June 30, 2019: | |||||
Revenues | $7,078,800 | $1,814,900 | $1,306,100 | $- | $10,199,800 |
Foreign Sales | 2,680,300 | 1,102,300 | 1,301,200 | - | 5,083,800 |
Benchtop Laboratory Equipment | Catalyst Research Instruments | Bioprocessing Systems | Corporate and Other | Consolidated | Benchtop Laboratory Equipment | Catalyst Research Instruments | Bioprocessing Systems | Corporate and Other | Consolidated | |
June 30, 2017: | ||||||||||
June 30, 2020: | ||||||||||
Revenues | $5,784,400 | $2,070,200 | $294,700 | $- | $8,149,300 | $6,783,600 | $785,900 | $1,000,800 | $- | $8,570,300 |
Foreign Sales | 2,467,400 | 129,200 | - | 2,596,600 | 2,589,800 | 586,500 | 1,000,400 | - | 4,176,700 | |
Income (Loss) From Operations | 288,100 | (312,900) | (135,600) | - | (160,400) | 449,700 | (472,800) | (727,500) | (385,700) | (1,136,300) |
Assets | 4,100,800 | 1,518,100 | 408,200 | 800,600 | 6,827,700 | 12,232,600 | 1,149,800 | 546,100 | 868,900 | 14,797,400 |
Long-Lived Asset Expenditures | 20,700 | - | 12,800 | - | 33,500 | 36,000 | - | 40,700 | - | 76,700 |
Depreciation, Amortization and Impairment | 292,600 | 14,000 | 97,300 | - | 403,900 | |||||
Depreciation and Amortization | 116,900 | 1,300 | 42,700 | - | 160,900 |
Benchtop Laboratory Equipment | Catalyst Research Instruments | Bioprocessing Systems | Corporate and Other | Consolidated | |
June 30, 2016: | |||||
Revenues | $5,449,700 | $4,032,800 | $115,100 | $- | $9,597,600 |
Foreign Sales | 2,414,600 | 2,674,300 | - | - | 5,088,900 |
Income (Loss) From Operations | 223,800 | 479,500 | (458,300) | - | 245,000 |
Assets | 4,120,700 | 2,292,100 | 429,900 | 706,600 | 7,549,300 |
Long-Lived Asset Expenditures | 92,500 | 4,000 | 9,400 | - | 105,900 |
Depreciation, Amortization and Impairment | 299,000 | 31,900 | 310,700 | - | 641,600 |
Benchtop Laboratory Equipment | Catalyst Research Instruments | Bioprocessing Systems | Corporate and Other | Consolidated | |
June 30, 2019: | |||||
Revenues | $7,078,800 | $1,814,900 | $1,306,100 | $- | $10,199,800 |
Foreign Sales | 2,680,300 | 1,102,300 | 1,301,200 | - | 5,083,800 |
Income (Loss) From Operations | 449,800 | (130,600) | 365,000 | 91,900 | 776,100 |
Assets | 5,280,700 | 1,443,200 | 790,100 | 762,000 | 8,276,000 |
Long-Lived Asset Expenditures | 194,500 | 2,200 | 15,700 | - | 212,400 |
Depreciation and Amortization | 217,800 | 1,000 | 38,500 | - | 257,300 |
Fair Value Measurements Using Inputs Considered as | ||||||||
Fair Value at June 30, 2017 | Level 1 | Level 2 | Level 3 | Fair Value Measurements Using Inputs Considered as | ||||
Fair Value at June 30, 2020 | Level 1 | Level 2 | Level 3 | |||||
Assets: | ||||||||
Cash and cash equivalents | $1,025,100 | $- | $7,559,700 | $- | ||||
Available for sale securities | 295,500 | - | ||||||
Investment securities | 331,800 | - | ||||||
Total | $1,320,600 | $- | $7,891,500 | $- | ||||
Liabilities: | ||||||||
Contingent consideration | $297,000 | $- | $297,000 | $358,000 | $- | $358,000 |
Fair Value Measurements Using Inputs Considered as | ||||
Fair Value at June 30, 2016 | Level 1 | Level 2 | Level 3 | |
Assets: | ||||
Cash and cash equivalents | $1,245,000 | $1,245,000 | $- | $- |
Available for sale securities | 290,100 | 290,100 | - | - |
Total | $1,535,100 | $1,535,100 | $- | $- |
Liabilities: | ||||
Contingent consideration | $346,300 | $- | $- | $346,300 |
Fair Value Measurements Using Inputs Considered as | ||||
Fair Value at June 30, 2019 | Level 1 | Level 2 | Level 3 | |
Assets: | ||||
Cash and cash equivalents | $1,602,500 | $1,602,500 | $- | $- |
Investment securities | 330,900 | 330,900 | - | - |
Total | $1,933,400 | $1,933,400 | $- | $- |
Liabilities: | ||||
Contingent consideration | $618,000 | $- | $- | $618,000 |
2020 | 2019 | |||
2017 | 2016 | |||
Beginning balance | $346,300 | $367,100 | $618,000 | $408,000 |
Increase in contingent consideration liability | 140,000 | 110,000 | 112,600 | 521,200 |
Payments | (189,300) | (130,800) | ||
Payments and accruals | (372,600) | (311,200) | ||
Ending balance | $297,000 | $346,300 | $358,000 | $618,000 |
Cost | Fair Value | Unrealized Holding Gain (Loss) | |
At June 30, 2020: | |||
Equity securities | $77,600 | $101,900 | $24,300 |
Mutual funds | 250,300 | 229,900 | (20,400) |
$327,900 | $331,800 | $3,900 |
Cost | Fair Value | Unrealized Holding Gain (Loss) | |
At June 30, 2019: | |||
Equity securities | $47,100 | $72,000 | $24,900 |
Mutual funds | 292,300 | 258,900 | (33,400) |
$339,400 | $330,900 | $(8,500) |
Cost | Fair Value | Unrealized Holding Gain (Loss) | |
At June 30, 2017: | |||
Available for sale: | |||
Equity securities | $37,000 | $50,800 | $13,800 |
Mutual funds | 262,000 | 244,700 | (17,300) |
$299,000 | $295,500 | $(3,500) |
Cost | Fair Value | Unrealized Holding Gain (Loss) | |
At June 30, 2016: | |||
Available for sale: | |||
Equity securities | $29,300 | $40,700 | $11,400 |
Mutual funds | 259,900 | 249,400 | (10,500) |
$289,200 | $290,100 | $900 |
2017 | 2016 | 2020 | 2019 | |
Raw materials | $1,373,800 | $1,529,800 | $1,838,500 | $1,738,300 |
Work-in-process | 166,500 | 425,300 | 228,600 | 106,400 |
Finished goods | 420,900 | 457,000 | 817,600 | 747,600 |
$1,961,200 | $2,412,100 | $2,884,700 | $2,592,300 |
Useful Lives | Useful Lives | |||||
| (Years) | 2017 | 2016 | (Years) | 2020 | 2019 |
Automobiles | 5 | $22,000 | 5 | $22,000 | ||
Computer equipment | 3-5 | 162,800 | 162,200 | 3-5 | 247,900 | 233,900 |
Machinery and equipment | 3-7 | 819,600 | 803,300 | 3-7 | 1,010,600 | 986,500 |
Furniture and fixtures | 4-10 | 205,900 | 4-10 | 209,700 | 205,900 | |
Leasehold improvements | 3-10 | 34,200 | 3-10 | 53,300 | 45,300 | |
1,244,500 | 1,227,600 | 1,543,500 | 1,493,600 | |||
Less accumulated depreciation and amortization | 1,045,200 | 976,500 | 1,263,800 | 1,174,800 | ||
$199,300 | $251,100 | $279,700 | $318,800 |
Useful Lives | Cost | Accumulated Amortization | Net | |
At June 30, 2017: | ||||
Technology, trademarks | 5/10 yrs. | $662,800 | $541,100 | $121,700 |
Trade names | 6 yrs. | 140,000 | 77,800 | 62,200 |
Websites | 5 yrs. | 210,000 | 140,000 | 70,000 |
Customer relationships | 9/10 yrs. | 357,000 | 281,400 | 75,600 |
Sublicense agreements | 10 yrs. | 294,000 | 165,400 | 128,600 |
Non-compete agreements | 5 yrs. | 384,000 | 294,000 | 90,000 |
IPR&D | 3 yrs. | 110,000 | 110,000 | - |
Other intangible assets | 5 yrs. | 194,500 | 163,600 | 30,900 |
$2,352,300 | $1,773,300 | $579,000 |
Useful Lives | Cost | Accumulated Amortization | Net | |
At June 30, 2016: | ||||
Technology, trademarks | 5/10 yrs. | $722,800 | $468,800 | $254,000 |
Trade names | 6 yrs. | 140,000 | 54,400 | 85,600 |
Websites | 5 yrs. | 210,000 | 98,000 | 112,000 |
Customer relationships | 9/10 yrs. | 357,000 | 261,600 | 95,400 |
Sublicense agreements | 10 yrs. | 294,000 | 136,000 | 158,000 |
Non-compete agreements | 5 yrs. | 384,000 | 239,100 | 144,900 |
IPR&D | 3 yrs. | 110,000 | 85,500 | 24,500 |
Other intangible assets | 5 yrs. | 177,900 | 154,700 | 23,200 |
$2,395,700 | $1,498,100 | $897,600 |
Fiscal Years | |
2018 | $243,600 |
2019 | 185,800 |
2020 | 65,400 |
2021 | 48,000 |
2022 | 27,000 |
Thereafter | 9,200 |
Total | $579,000 |
Useful Lives | Cost | Accumulated Amortization | Net | |
At June 30, 2020: | ||||
Technology, trademarks | 5/10 yrs. | $664,700 | $662,000 | $2,700 |
Trade names | 6 yrs. | 140,000 | 140,000 | - |
Websites | 5 yrs. | 210,000 | 210,000 | - |
Customer relationships | 9/10 yrs. | 357,000 | 321,400 | 35,600 |
Sublicense agreements | 10 yrs. | 294,000 | 253,600 | 40,400 |
Non-compete agreements | 5 yrs. | 384,000 | 384,000 | - |
IPR&D | 3 yrs. | 110,000 | 110,000 | - |
Other intangible assets | 5 yrs. | 246,600 | 196,600 | 50,000 |
$2,406,300 | $2,277,600 | $128,700 |
Useful Lives | Cost | Accumulated Amortization | Net | |
At June 30, 2019: | ||||
Technology, trademarks | 5/10 yrs. | $663,800 | $661,700 | $2,100 |
Trade names | 6 yrs. | 140,000 | 124,400 | 15,600 |
Websites | 5 yrs. | 210,000 | 210,000 | - |
Customer relationships | 9/10 yrs. | 357,000 | 308,100 | 48,900 |
Sublicense agreements | 10 yrs. | 294,000 | 224,100 | 69,900 |
Non-compete agreements | 5 yrs. | 384,000 | 384,000 | - |
IPR&D | 3 yrs. | 110,000 | 110,000 | - |
Other intangible assets | 5 yrs. | 221,700 | 183,200 | 38,500 |
$2,380,500 | $2,205,500 | $175,000 |
Year Ended June 30, | |
2021 | $59,800 |
2022 | 36,800 |
2023 | 20,200 |
2024 | 8,400 |
2025 | 3,500 |
Total | $128,700 |
Fiscal Years | |
2018 | $220,000 |
2019 | 169,000 |
2020 | 174,000 |
2021 | 179,300 |
2022 | 184,600 |
Thereafter | 477,700 |
$1,404,600 |
Year ended June 30, | Amount |
2018 | $175,700 |
2019 | 35,000 |
2020 | 30,000 |
2021 | 26,000 |
2022 | 14,000 |
Thereafter | 16,300 |
$297,000 |
Year ended June 30, | Amount |
2021 | $111,000 |
2022 | 95,000 |
2023 | 82,000 |
2024 | 70,000 |
$358,000 |
2017 | 2016 | |||
Amount | % of Pre-tax Income | Amount | % of Pre-tax Income | |
Computed “expected” income tax (benefit) | $(51,400) | (35.0)% | $76,600 | 35.0% |
Research and development credits | (13,100) | (8.9) | (15,700) | (7.2) |
Other, net | (9,700) | (6.6) | (7,600) | (3.5) |
Income tax expense (benefit) | $(74,200) | (50.5)% | $53,300 | 24.3% |
2017 | 2016 | |
Deferred tax assets: | ||
Amortization of intangible assets | $390,000 | $287,000 |
Research and development credits | 3,400 | - |
Various accruals | 102,300 | 132,800 |
Other | 55,000 | 48,900 |
550,700 | 468,700 | |
Deferred tax liability: | ||
Depreciation of property and amortization of goodwill | (45,600) | (52,200) |
Net deferred tax assets | $505,100 | $416,500 |
Year ended June 30, | Amount |
2021 | $265,800 |
2022 | 210,600 |
2023 | 198,900 |
2024 | 195,900 |
2025 | 91,600 |
$962,800 |
2020 | 2019 | |
Computed “expected” income tax (benefit) | $(239,400) | $161,700 |
Research and development credits | (89,400) | (24,300) |
Rate changes and NOL carrybacks | (122,600) | - |
Other, net | 14,800 | (12,800) |
Income tax expense (benefit) | $(436,600) | $124,600 |
2017 | 2016 | |
Current deferred tax assets | $129,000 | $140,600 |
Long-term deferred tax assets | 421,700 | 328,100 |
Long-term deferred tax liabilities | (45,600) | (52,200) |
Net long-term deferred tax assets | 376,100 | 275,900 |
Net deferred tax assets | $505,100 | $416,500 |
2020 | 2019 | |
Deferred tax assets: | ||
Amortization of intangible assets | $329,700 | $303,900 |
Research and development credits | 89,400 | - |
Various accruals | 150,700 | 173,600 |
Other | 19,400 | 13,300 |
589,200 | 490,800 | |
Deferred tax liability: | ||
Depreciation of property and amortization of goodwill | (52,100) | (59,700) |
Net deferred tax assets | $537,100 | $431,100 |
Fiscal 2017 | Fiscal 2016 | June 30, 2020 | June 30, 2019 | |||||
Weighted- | Weighted- | Weighted- | Weighted- | |||||
Average | Average | Average | Average | |||||
Exercise | Exercise | Exercise | Exercise | |||||
Shares | Price | Shares | Price | Shares | Price | Shares | Price | |
Shares under option: | ||||||||
Outstanding, beginning of year | 43,500 | $3.33 | 38,500 | $3.33 | 97,205 | $3.24 | 92,000 | $3.15 |
Granted | 6,000 | 2.91 | 5,000 | 3.05 | 25,881 | 7.47 | 6,705 | 4.54 |
Exercised | (5,000) | 3.10 | - | (24,000) | 3.35 | - | ||
Forfeited | (10,000) | 3.45 | - | (2,500) | 3.08 | 1,500 | 3.27 | |
Outstanding, end of year | 34,500 | 3.25 | 43,500 | 3.33 | 96,586 | $4.35 | 97,205 | $3.24 |
Options exercisable at year-end | 23,833 | $3.52 | 32,200 | $3.43 | 49,236 | $3.29 | 50,167 | $3.29 |
Weighted average fair value per share of options granted during the fiscal year | $1.76 | $1.89 | $5.58 | $1.79 |
As of June 30, 2017 Options Outstanding | As of June 30, 2017 Exercisable | As of June 30, 2020 Options Outstanding | As of June 30, 2020 Exercisable | |||||||
Weighted- | Weighted- | |||||||||
Average | Weighted- | Weighted- | Average | Weighted- | Weighted- | |||||
Range | Remaining | Average | Average | Remaining | Average | Average | ||||
Exercise | Number | Contractual | Exercise | Number | Exercise | Number | Contractual | Exercise | Number | Exercise |
Prices | Outstanding | Life (Years) | Price | Outstanding | Price | Outstanding | Life (Years) | Price | Outstanding | Price |
$3.50 -$4.05 | 20,000 | 6.13 | $3.64 | 18,666 | $3.64 | |||||
$5.35 - $ 11.30 | 25,881 | 9.87 | $7.47 | - | $0.00 | |||||
$2.91 -$3.27 | 14,500 | 3.67 | $3.02 | 5,167 | $3.12 | |||||
$2.91 - $ 4.65 | 70,705 | 6.46 | $3.33 | 49,236 | $3.29 | |||||
34,500 | 23,833 | 96,586 | 49,236 |
As of June 30, 2016 Options Outstanding | As of June 30, 2016 Exercisable | As of June 30, 2019 Options Outstanding | As of June 30, 2019 Exercisable | |||||||
Weighted- | Weighted- | |||||||||
Average | Weighted- | Weighted- | Average | Weighted- | Weighted- | |||||
Range | Remaining | Average | Average | Remaining | Average | Average | ||||
Exercise | Number | Contractual | Exercise | Number | Exercise | Number | Contractual | Exercise | Number | Exercise |
Prices | Outstanding | Life (Years) | Price | Outstanding | Price | Outstanding | Life (Years) | Price | Outstanding | Price |
$3.50 -$4.05 | 20,000 | 7.13 | $3.64 | 13,700 | $3.65 | |||||
$2.91 - $ 3.08 | 70,500 | 7.81 | $3.07 | 30,167 | $2.80 | |||||
$3.07 -$3.45 | 23,500 | 2.83 | $3.25 | 18,500 | $3.30 | |||||
$3.65 - $ 4.65 | 26,705 | 5.57 | $4.02 | 20,000 | $3.84 | |||||
43,500 | 32,200 | 97,205 | 50,167 |
2017 | 2016 | 2020 | 2019 | |
Net income (loss) | $(72,600) | $165,600 | $(703,300) | $645,600 |
Weighted average common shares outstanding | 1,491,167 | 1,489,112 | 1,515,103 | 1,494,112 |
Effect of dilutive securities | - | 275 | - | 18,066 |
Weighted average dilutive common shares outstanding | 1,491,167 | 1,489,387 | 1,515,103 | 1,512,178 |
Basic earnings (loss) per common share | $(.05) | $.11 | ||
Diluted earnings (loss) per common share | $(.05) | $.11 | ||
Basic and diluted earnings (loss) per common share | $(.46) | $.43 |