[Conformed Copy]
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934
For the quarterly period ended September 27, 1997
OR
- --- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________________ to _____________
Commission File Number 0-3704
NAI TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
New York 11-1798773
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
282 New York Avenue, Huntington, New York 11743
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (516) 271-5685
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
As of November 1, 1997, 9,155,427 shares of NAI Technologies, Inc.'s $.10 par
value Common Stock were outstanding.
Page 1 of 15 Pages
Page 2
NAI TECHNOLOGIES, INC.
INDEX
PAGE
Facing Sheet 1
Index 2
PART I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets - 3
September 27, 1997 and December 31, 1996
Consolidated Statements of Operations - 4
Three months ended September 27, 1997 and
September 28, 1996
Consolidated Statements of Operations - 5
Nine months ended September 27, 1997 and
September 28, 1996
Consolidated Statements of Cash Flows - 6
Nine months ended September 27, 1997 and
September 28, 1996
Other Financial Information 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8-13
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
Exhibits 16
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NAI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
SEPT. 27, DEC. 31,
1997 1996
- ----------------------------------------------------------------------------------------------
(AUDITED)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 963 $ 2,727
Accounts receivable, net 10,017 12,693
Inventories, net 7,269 10,270
Deferred tax asset 165 173
Other current assets 608 597
- ----------------------------------------------------------------------------------------------
Total current assets 19,022 26,460
- ----------------------------------------------------------------------------------------------
Property, plant and equipment, net 2,968 3,523
Excess of cost over fair value of assets
acquired, net 9,233 9,707
Other assets 1,412 1,681
- ---------------------------------------------------------------------------------------
Total assets $32,635 $41,371
=======================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current installments of long-term debt $ 82 $ 158
Notes payable 68 -
Accounts payable 4,505 6,907
Accrued payroll and commissions 148 680
Other accrued expenses 2,406 3,894
Income taxes payable 1,111 580
- ----------------------------------------------------------------------------------------------
Total current liabilities 8,320 12,219
- ----------------------------------------------------------------------------------------------
Long-term debt 9,990 12,224
Other accrued expenses 796 912
Deferred income taxes 36 36
- ----------------------------------------------------------------------------------------------
Total liabilities $19,142 $25,391
- ----------------------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY:
Capital Stock:
Preferred stock, no par value, 2,000,000
shares authorized and unissued -- --
Common stock, $.10 par value, 25,000,000
shares authorized; shares issued: 9,155,427
in 1997 and 8,841,937 in 1996 916 902
Capital in excess of par value 19,456 19,217
Foreign currency translation adjustment 102 313
Retained earnings (deficit) (6,981) (4,452)
- -----------------------------------------------------------------------------------------------
Total shareholders' equity 13,493 15,980
- ----------------------------------------------------------------------------------------------
Total liabilities and shareholders' equity $32,635 $41,371
==============================================================================================
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NAI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
FOR THE THREE MONTHS ENDED
--------------------------
SEPT. 27, SEPT. 28,
1997 1996
- ---------------------------------------------------------------------------------------
Net sales $12,553 $17,271
- ---------------------------------------------------------------------------------------
Cost of sales 12,562 13,470
- ---------------------------------------------------------------------------------------
Gross margin (9) 3,801
- ---------------------------------------------------------------------------------------
Selling expense 907 894
General and administrative expenses 1,401 1,423
Research and development 334 343
Other 189 (609)
- ---------------------------------------------------------------------------------------
Total expenses 2,831 2,051
- ---------------------------------------------------------------------------------------
Operating earnings (loss) (2,840) 1,750
- ---------------------------------------------------------------------------------------
Non-operating income (expense)
Deferred debt expense (80) (120)
Interest income 15 13
Interest expense (371) (548)
- ----------------------------------------------------------------------------------------
(436) (655)
- ----------------------------------------------------------------------------------------
Earnings (loss) before income taxes (3,276) 1,095
Provision for income taxes 133 131
- ----------------------------------------------------------------------------------------
Net income (loss) $(3,409) $ 964
========================================================================================
Earnings (loss) per common share $ (0.37) $ 0.11
========================================================================================
Average shares outstanding 9,133 9,000
========================================================================================
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NAI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
FOR THE NINE MONTHS ENDED
--------------------------
SEPT. 27, SEPT. 28,
1997 1996
- ----------------------------------------------------------------------------------------
Net sales $39,727 $51,128
- ----------------------------------------------------------------------------------------
Cost of sales 32,332 40,512
- ----------------------------------------------------------------------------------------
Gross margin 7,395 10,616
- ----------------------------------------------------------------------------------------
Selling expense 2,905 3,010
General and administrative expenses 3,560 3,933
Research and development 1,126 1,215
Other 467 (1,081)
- ----------------------------------------------------------------------------------------
Total expenses 8,058 7,077
- ----------------------------------------------------------------------------------------
Operating earnings (loss) (663) 3,539
- ----------------------------------------------------------------------------------------
Non-operating income (expense)
Other - 15
Deferred debt expense (260) (345)
Interest income 47 114
Interest expense (1,149) (1,722)
- ----------------------------------------------------------------------------------------
(1,362) (1,938)
- ----------------------------------------------------------------------------------------
Earnings (loss) before income taxes (2,025) 1,601
Provision for income taxes 504 272
- -----------------------------------------------------------------------------------------------------
Net earnings (loss) $(2,529) $ 1,329
==============================================================================================
Earnings (loss) per common share $(0.28) $ 0.16
==============================================================================================
Average shares outstanding 9,079 8,326
==============================================================================================
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NAI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
FOR THE NINE MONTHS ENDED
SEPT. 27, SEPT. 28,
1997 1996
- ---------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings (loss) $(2,529) $ 1,329
Adjustments to reconcile net loss to cash
provided by (used in) operating activities:
Depreciation and amortization 1,681 1,918
Net (gain) on sale of property, plant and
equipment and other (6) (1,543)
Provision for inventory obsolescence 2,585 127
Loss on sale of notes receivable -- 89
Change in assets and liabilities, excluding effects
from acquisitions and foreign currency adjustments:
Accounts receivable 2,676 1,454
Inventories (net of reserve provisions) 416 662
Accounts payable and other accrued expenses (4,538) (7,576)
Income taxes 539 270
Other, net (25) (1,020)
- ----------------------------------------------------------------------------------------
Net cash flow provided by (used in) operating
activities 799 (4,290)
- ----------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment (315) (477)
Proceeds from sale of property, plant and
equipment and other 22 2,266
- ---------------------------------------------------------------------------------------
Net cash (used in) provided by investing activities (293) 1,789
- ---------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuances of notes payable 1,189 590
Issuance of 12% convertible bonds -- 5,842
Payments of notes payable (1,121) (590)
Payments of long-term debt (2,323) (3,683)
Receipts on notes receivable -- 1,101
Proceeds from exercise of stock options and stock
purchase plan, net 180 --
- ---------------------------------------------------------------------------------------
Net cash (used in) provided by financing activities (2,075) 3,080
- ---------------------------------------------------------------------------------------
Effect of foreign currency exchange rates on cash (195) 33
- ---------------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents (1,764) 612
Cash and cash equivalents at beginning of year 2,727 2,605
- ---------------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 963 $ 3,217
=======================================================================================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest $1,101 $ 1,696
Income taxes $14 $ 6
Non-cash investing and financing activities
Net conversions of 12% notes into common stock $73 $ 1,897
===================================================================================
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OTHER FINANCIAL INFORMATION
UNAUDITED FINANCIAL STATEMENTS
The accompanying unaudited consolidated financial statements have been prepared
by the Company pursuant to the rules and regulations of the Securities and
Exchange Commission (the "SEC") and, in the opinion of management, include all
adjustments (consisting of normal recurring accruals) necessary for a fair
presentation of financial position, results of operations and cash flows for the
interim periods. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the rules and
regulations of the SEC. The Company believes that the disclosures contained
herein are adequate to make the information presented not misleading. The
consolidated statements of operations for the nine months ended September 27,
1997 are not necessarily indicative of the results to be expected for the full
year. These unaudited financial statements should be read in conjunction with
the audited financial statements and accompanying notes included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1996.
INVENTORIES
Inventories are summarized by major classification as follows:
- ----------------------------------------------------------------------------------------
Sept. 27, Dec. 31,
1997 1996
(Audited)
- ----------------------------------------------------------------------------------------
(In thousands of dollars)
Raw materials and components $8,082 $8,567
Work-in-process 2,669 3,010
Finished goods 1,446 1,204
Allowance for obsolescence (4,798) (2,403)
Unliquidated progress payments (130) (108)
- ----------------------------------------------------------------------------------------
Inventories, net $7,269 $10,270
=======================================================================================
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Page 8
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Third Quarter 1997 Compared with Third Quarter 1996
The nature of the Company's business is such that year to year changes in sales
levels are predominantly due to changes in shipping volume or product mix rather
than changing sales prices. Net sales for the third quarter of 1997 were $12.6
million, a 27% decrease when compared with $17.3 million for the same period in
1996.
The following chart provides the sales breakdown by segment and subsidiary for
the third quarter:
In thousands of dollars 1997 1996 % Change
- -------------------------------------------------------------------------------------------
ELECTRONIC SYSTEMS SEGMENT
Codar Technology, Inc. $2,743 $8,420 (67%)
NAI Systems Division 4,595 3,735 23%
Lynwood Scientific Dev. Ltd. 4,525 3,620 25%
Inter-company (32) (26) --
--------------------------------
Total Electronic Systems Segment 11,831 15,749 (25%)
TELECOMMUNICATIONS SEGMENT
Wilcom, Inc. 722 1,522 (53%)
----------------------------------
Total Telecommunications Segment 722 1,522 (53%)
----------------------------------
TOTAL $12,553 $17,271 (27%)
==================================
Sales in the Electronic Systems segment (net of inter-company eliminations)
decreased 25% to $11.8 million from $15.7 million for the same period in 1996.
Sales increases of 25% at Lynwood Scientific Development Ltd. and 23% at NAI
Systems Division were more than offset by a 67% sales decline at Codar. The
sales decline at Codar is attributable to several factors, most notably a
decline in Codar's rate of booking new orders for the CHS II product line and
rugged work station products. Codar believes the bookings decline to be
temporary, however, it must be noted that until the booking rate increases,
Codar will continue to report less than optimum operating results. During the
third quarter the U.S. Army approved Codar's Rugged 16 Inch and 20 Inch Flat
Panel display products and the rugged portable integrated Sun Workstation on the
CHS II Contract. The Company has reduced its ongoing operating expenses at Codar
to mitigate the potential adverse impact of continuing lower sales. Codar is in
the process of rebuilding its internal sales and marketing resources. The sales
increases at Systems Division and Lynwood from the same period in 1996 are
representative of the increased levels of business at both companies.
In recent years the Company has reduced its dependency on the United States
defense budget by expanding its non-military business operations. However, the
Company still expects approximately 30% of 1997 sales to be directly to the
military or through prime contractors to the military. The Company is not aware
of any programs in which it participates that are specifically targeted for
termination or curtailment. The Company's products are utilized on many
different U.S. Government programs, which reduces the adverse impact of
canceling a single specific program. However, changes in future U.S. defense
spending levels could impact the Company's future sales volume.
-8-
Page 9
Sales in the Telecommunications segment decreased 53% to $0.7 million as
compared to $1.5 million for the same period in 1996. The decrease in sales is
attributable to the rapid decline in sales of their MFT analog line treatment
products as well as the slower than expected ramp up in the sales of the new
Turbo Amp products. The Company is exploring all available methods to increase
revenues and has recently added additional sales personnel in the
Telecommunications segment.
The gross margin percentage for the third quarter of 1997 was 0% as compared
with 22% in the comparable period in 1996. The following chart provides the
gross margin percentage by subsidiary.
1997 1996
- -------------------------------------------------------------------------------------
Codar Technology, Inc. (75.9%) 13.5%
NAI Systems Division 18.4% 19.7%
Lynwood Scientific Dev. Ltd. 29.8% 33.9%
Wilcom, Inc. (16.9%) 46.2%
Codar's margin was adversely impacted by a $3.0 million charge substantially
related to an inventory write-down which resulted from lower than expected sales
along with the final withdrawal from electronic printer products and the
addition of certain more advance Codar products on the CHS II program.
Wilcom's margins were adversely impacted by lower shipping volume.
The lower gross margin at Lynwood is attributable to an unfavorable mix of high
and low margin sales during the quarter.
Selling expense for the third quarter of 1997 and 1996 were relatively unchanged
at $0.9 million for both periods.
General and administrative expenses for the third quarter of 1997 were $1.4
million essentially unchanged from the comparable 1996 figure.
Company-sponsored research and development expenditures for the third quarter of
1997 and 1996 were relatively unchanged at $0.3 million for both periods. The
Company expects that internal research and development expenditures will remain
relatively constant for the remainder of 1997.
For the third quarter of 1997, the Company had an operating loss of $2.8 million
as compared with operating income of $1.8 million for the same period in 1996.
The operating loss was attributable to lower sales and a $3.0 million charge
substantially related to an inventory write-down at the Company's Codar
subsidiary. The 1996 operating income included a gain of $0.75 million from the
sale of the Systems Integration Division.
Interest expense and amortization of deferred debt costs, net of interest
income, was $0.4 million for the third quarter of 1997 as compared with $0.7
million for the same period in 1996.
The Company recorded income tax expense of $0.1 million in the third quarter of
1997, which equates to an effective tax rate of 31%. The entire tax expense
pertains to the Company's Lynwood subsidiary located in the U.K. Lynwood's
earnings are taxed in the U.K. and, while the Company has a U.S. net operating
loss carry-forward, it is required to pay taxes in the U.K. The Company is
unable to recognize the entire future tax benefit associated with its U.S.
operating loss carry-forwards due to uncertainties as to whether or not a future
benefit will be realized.
-9-
Page 10
For the third quarter of 1997 the Company recorded a net loss of $3.4 million as
compared with a net profit of $1.0 million in the third quarter of 1996.
Earnings (loss) per share were ($0.37) as compared with $0.11 per share for the
same period in 1996, based on a weighted average of 9.1 million and 9.0 million
shares outstanding, respectively.
First Nine Months of 1997 Compared with First Nine Months of 1996
The nature of the Company's business is such that year to year changes in sales
levels are predominantly due to changes in shipping volume or product mix rather
than changing sales prices. Net sales for the first nine months of 1997 were
$39.7 million, a 22% decrease when compared with $51.1 million for the same
period in 1996.
The following chart provides the sales breakdown by segment and subsidiary for
the first nine months:
In thousands of dollars 1997 1996 % Change
- ----------------------------------------------------------------------------------------
ELECTRONIC SYSTEMS SEGMENT
Codar Technology, Inc. $10,977 $25,098 (56%)
NAI Systems Division 12,967 10,265 26%
Lynwood Scientific Dev. Ltd. 13,278 10,278 29%
Inter-company (564) (286) --
-----------------------------------
Total Electronic Systems Segment 36,658 45,355 (19%)
TELECOMMUNICATIONS SEGMENT
Wilcom, Inc. 3,069 5,773 (47%)
-----------------------------------
Total Telecommunications Segment 3,069 5,773 (47%)
-----------------------------------
TOTAL $39,727 $51,128 (22%)
===================================
Sales in the Electronic Systems segment (net of inter-company eliminations)
decreased 19% to $36.7 million from $45.4 million for the same period in 1996.
Sales increases of 29% at Lynwood Scientific Development Ltd. and 26% at NAI
Systems Division were more than offset by a 56% sales decline at Codar. The
sales decline at Codar is attributable to several factors, most notably a
decline in Codar's rate of booking new orders for the CHS II product line and
rugged work station products. Codar believes the bookings decline to be
temporary, however, it must be noted that until the bookings rate increases,
Codar will continue to report less than optimum operating results. The Company
recently reduced its ongoing operating expenses at Codar to mitigate the
potential adverse impact of continuing lower sales. Codar is in the process of
rebuilding its internal sales and marketing resources. Codar's 1996 sales levels
were favorably impacted by delays in shipments from prior years. The sales
increases at Systems Division and Lynwood from the same period in 1996 are
representative of the increased levels of business at both companies.
In recent years the Company has reduced its dependency on the United States
defense budget by expanding its non-military business operations. However, the
Company still expects approximately 30% of 1997 sales to be directly to the
military or through prime contractors to the military. The Company is not aware
of any programs in which it participates that are specifically targeted
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Page 11
for termination or curtailment. The Company's products are utilized on many
different U.S. Government programs, which reduces the adverse impact of
canceling a single specific program. However, changes in future U.S. defense
spending levels could impact the Company's future sales volume.
Sales in the Telecommunications segment decreased 47% to $3.1 million as
compared to $5.8 million for the same period in 1996. The decrease in sales is
attributable to the rapid decline in sales of their MFT analog line treatment
products as well as the slower than expected ramp up in the sales of the new
Turbo Amp products. The Company is exploring all available methods to increase
its revenues and has recently added additional sales personnel in the
Telecommunications segment.
The gross margin percentage for the first nine months of 1997 was 18.6% as
compared with 20.8% for the same period in 1996. The following chart provides
the gross margin percentage by subsidiary.
1997 1996
- -------------------------------------------------------------------------------------
Codar Technology, Inc. (8.6%) 11.6%
NAI Systems Division 24.8% 19.7%
Lynwood Scientific Dev. Ltd. 33.3% 33.3%
Wilcom, Inc. 23.0% 36.8%
Codar's margin was adversely impacted by a $3.0 million charge substantially
related to an inventory write-down which was necessitated by lower than expected
sales at Codar and the final withdrawal from electronic printer products and the
replacement of some of Codar's products on the CHS II program with new more
advanced Codar products.
Lower shipping volume adversely impacted Wilcom's gross margin.
The higher gross margin percentage at NAI Systems Division is attributable to
increased shipping volumes and a more favorable mix of development, production
and mature product sales.
Selling expense for the first nine months of 1997 was $2.9 million as compared
with $3.0 million for the same period in 1996.
General and administrative expenses for the first nine months of 1996 were $3.6
million as compared with $3.9 million for the same period in 1996. The decline
is attributable to the Company's continuing goal of reducing its operating
expenses.
Company-sponsored research and development expenditures for the first nine
months of 1997 were $1.1 million as compared with $1.2 million for the same
period in 1996. The Company expects that the rate of IR&D expenditures for the
first nine months of 1997 will remain relatively constant for the remainder of
the year.
For the first nine months of 1997, the Company had an operating loss of $0.7
million as compared with operating earnings of $3.5 million for the same period
in 1996. The operating loss was attributable to lower sales and a $3.0 million
charge substantially related to an inventory write-down at the Company's Codar
subsidiary. The 1996 operating income included a gain of $1.5 million from the
sale of the Systems Integration Division.
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Page 12
Interest expense and amortization of deferred debt costs, net of interest
income, was $1.4 million for the first nine months of 1997 as compared with $1.9
million for the same period in 1996.
The Company recorded income tax expense of $0.5 million for the first nine
months of 1997, which equates to an effective tax rate of 31%. The entire tax
expense pertains to the Company's Lynwood subsidiary located in the U.K.
Lynwood's earnings are taxed in the U.K. and, while the Company has a U.S. net
operating loss carry-forward, it is required to pay taxes in the U.K. The
Company is unable to recognize the entire future tax benefit associated with its
U.S. operating loss carry-forwards due to uncertainties as to whether or not a
future benefit will be realized.
For the first nine months of 1997 the Company recorded a net loss of $2.5
million as compared with a net profit of $1.3 million in the comparable period
of 1996. Earnings (loss) per share were ($0.28) as compared with earnings of
$0.16 for the same period in 1996, based on a weighted average of 9.1 million
and 8.3 million shares outstanding, respectively.
Liquidity and Capital Resources
Cash and cash equivalents totaled $1.0 million at September 27, as compared to
$2.7 million at December 31, 1996. Cash provided by operating activities
amounted to $0.8 million for the first nine months of 1997, as compared to cash
used by operating activities of $4.3 million in the comparable period of 1996.
The 1996 period saw a large outflow of funds to the Company's vendors which had
been delayed pending completion of the Company's sale of its 12% Convertible
Notes.
During the first nine months of 1997, the Company reduced outstanding bank debt
by $2.2 million bringing the total amount outstanding to $5.3 million at quarter
end. The Company has made payments totaling $4.2 million in excess of
requirements and has the right to borrow such amount back if needed.
During the first nine months of 1997, $104,500 of the 12% Convertible Notes were
converted into 52,250 shares. At September 27, 1997 $5,122,500 of the 12%
Convertible Notes were outstanding.
The Company believes that it has adequate cash, cash flow and borrowing
capabilities in place to fund its working capital needs for the foreseeable
future.
Inflation
The Company's financial statements are prepared in accordance with historical
accounting systems, and therefore do not reflect the effect of inflation. The
impact of changing prices on the financial statements is not considered to be
significant.
This document may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are based on
current plans and expectations of NAI Technologies and involve risks and
uncertainties that could cause actual future activities and results of
operations to be materially different from those set forth in the forward-
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Page 13
looking statements. Important factors that could cause actual results to differ
include, among others, changes in government purchasing policies and budget
constraints, competition, the continuity of booking trends, the absence of
supply interruptions, new products' market acceptance and warranty performance.
Other Information
The Company entered into a sixth and seventh amendment to its Credit Agreement
with the primary lenders providing for certain amendments to the interest rate
payable and adjustments to the interest coverage ratio under the credit
agreement.
-13-
Page 14
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
10(i) - Sixth Amendment, dated as of July 31, 1997, to Amended and
Restated Credit Agreement, dated as of April 12, 1995, as
previously amended, among the Registrant, Chemical Bank, a
New York banking corporation ("Chemical"), the Bank of New
York, a New York banking corporation ("BNY"), and each of
the other financial institutions which from time to time
becomes a party thereto (together with Chemical and BNY, the
"Banks"), BNY as administrative agent (the "Administrative
Agent"), and Chemical as collateral agent (the "Collateral
Agent").
10(ii) - Seventh Amendment and Waiver, dated as of November 5, 1997,
to Amended and Restated Credit Agreement, dated as of
April 12, 1995, as previously amended, among the Registrant,
the Banks, the Administrative Agent and the Collateral Agent.
11 - Statement re: Computation of Per Share Earnings
27 - Financial Data Schedule (Edgar Filing only)
b) Reports on Form 8-K
Registrant filed a current report on Form 8-K dated September 25,
1997 with respect to Registrant's press release announcing that
the Registrant expected to report a loss for the third quarter,
1997, due to a one-time write-down of approximately $3.0 million
that is substantially related to inventory write-downs at its
Codar Technology Inc. Subsidiary, lower than anticipated sales
at Codar and a faster than anticipated decline in the sales of
the Wilcom subsidiary's standard MFT analog line treatment
products.
-14-
Page 15
S I G N A T U R E S
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NAI TECHNOLOGIES, INC.
(Registrant)
DATE November 6, 1997 By:\s\Richard A. Schneider
------------------------- --------------------------
Richard A. Schneider
Executive Vice President
(On behalf of the registrant and as
Principal Financial Officer)
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