The
GSI Group, Inc.
|
|
(Exact
name of registrant as specified in its charter)
|
|
Delaware
|
37-0856587
|
(State
or other jurisdiction
|
(I.R.S.
Employer
|
of
incorporation or organization)
|
Identification
No.)
|
1004
E. Illinois Street, Assumption, Illinois
|
62510
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Registrant's
telephone number, including area code: (217)
226-4421
|
|
Securities
registered pursuant to Section 12(b) of the Act:
None
|
|
Securities
registered pursuant to Section 12(g) of the Act:
None
|
|
TABLE
OF CONTENTS
|
|||
PART
I
|
Page
|
||
Item
1.
|
Business
|
3
|
|
Item
1A.
|
Risk
Factors
|
11
|
|
Item
1B.
|
Unresolved
Staff Comments
|
12
|
|
Item
2.
|
Properties
|
13
|
|
Item
3.
|
Legal
Proceedings
|
13
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
13
|
|
PART
II
|
|||
Item
5.
|
Market
for the Registrant's Common Equity, Related Stockholder Matters
and
Issuer’s Purchases of Equity Securities
|
14
|
|
Item
6.
|
Selected
Financial Data
|
15
|
|
Item
7.
|
Management's
Discussion and Analysis of Financial Condition and Results of Operation
|
16
|
|
Item
7A.
|
Quantitative
and Qualitative Disclosure About Market Risk
|
20
|
|
Item
8.
|
Financial
Statements and Supplementary Data
|
21
|
|
Item
9.
|
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
|
45
|
|
Item
9A.
|
Controls
and Procedures
|
45
|
|
Item
9B.
|
Other
Information
|
46
|
|
PART
III
|
|||
Item
10.
|
Directors,
Executive Officers and Corporate Governance
|
47
|
|
Item
11.
|
Executive
Compensation
|
50
|
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters .
|
56
|
|
Item
13.
|
Certain
Relationships and Related Transactions, and Director Independence
|
58
|
|
Item
14.
|
Principal
Accounting Fees and Services
|
58
|
|
PART
IV
|
|||
Item
15.
|
Exhibits
and Financial Statement Schedules
|
60
|
|
Location
|
Owned/Leased
|
Description
of Property
|
Assumption,
Illinois
|
Own
|
Manufacturing/Sales
|
Paris,
Illinois
|
Own
|
Manufacturing/Assembly
|
Newton,
Illinois
|
Own
|
Manufacturing/Assembly
|
Vandalia,
Illinois
|
Own
|
Warehouse
|
Flora,
Illinois
|
Own
|
Manufacturing/Assembly
|
Taylorville,
Illinois
|
Lease
|
Manufacturing/Assembly
|
Clear
Lake, Iowa
|
Own
|
Sales/Warehouse
|
Sioux
City, Iowa
|
Lease
|
Sales/Warehouse
|
Marau,
Brazil
|
Own
|
Manufacturing/Sales
|
Penang,
Malaysia
|
Lease
|
Manufacturing/Sales/Warehouse
|
Queretero,
Mexico
|
Lease
|
Sales/Warehouse
|
Honeydew,
South Africa
|
Lease
|
Sales/Warehouse
|
Poznan,
Poland
|
Lease
|
Sales/Warehouse
|
Shanghai,
China
|
Lease
|
Sales/Warehouse
|
Number
of securities to be issued upon exercise of outstanding options,
warrants
and rights
|
Weighted
average exercise price of outstanding options, warrants and
rights
|
Number
of securities remaining available for future issuance
|
|
Plan
category
|
|||
Equity
Compensation plans approved by security holders
|
71,200
|
$104
|
28,800
|
Equity
compensation plans not approved by security holders
|
--
|
--
|
--
|
Total
|
71,200
|
$104
|
28,800
|
For
the Year Ended December 31
(in
thousands, except share data)
|
|||||
2002
|
2003
|
2004
|
2005
|
2006
|
|
Statement
of Operations Data:
|
|||||
Sales
|
$229,518
|
$236,868
|
$288,131
|
$344,144
|
$
428,616
|
Cost
of sales
|
188,560
|
188,778
|
223,691
|
267,108
|
335,073
|
Gross
profit
|
40,958
|
48,090
|
64,440
|
77,036
|
93,543
|
Operating
expenses
|
37,912
|
40,469
|
45,688
|
59,640
|
51,380
|
Operating
income
|
3,046
|
7,621
|
18,752
|
17,396
|
42,163
|
Interest
expense
|
(13,010)
|
(13,215)
|
(14,104)
|
(15,074)
|
(14,302)
|
Other
income (expense)
|
(610)
|
256
|
(90)
|
964
|
(170)
|
Income
(loss) before income taxes and minority interest
|
(10,574)
|
(5,338)
|
4,558
|
3,286
|
27,691
|
Provision
(benefit) for income taxes
|
106
|
(995)
|
499
|
319
|
11,288
|
Minority
interest in net income of subsidiary
|
(26)
|
(77)
|
(92)
|
(178)
|
(149)
|
Income
(loss) from continuing operations
|
(10,706)
|
(4,420)
|
3,967
|
2,789
|
16,254
|
Discontinued
Operations:
|
|||||
Gain
from sale of discontinued operations
|
--
|
--
|
118
|
--
|
--
|
Gain
from discontinued operations, net of tax
|
303
|
142
|
(93)
|
--
|
--
|
Net
income (loss)
|
$
(10,403)
|
$
(4,278)
|
$
3,992
|
$
2,789
|
$
16,254
|
Basic
and Diluted Earnings Per Share Data:
|
|||||
Continuing
operations
|
$
(6.03)
|
$
(2.49)
|
$
3.04
|
$
3.37
|
$
19.66
|
Discontinued
operations
|
0.17
|
0.08
|
0.02
|
--
|
--
|
Net
income (loss)
|
$
(5.86)
|
$
(2.41)
|
$
3.06
|
$
3.37
|
$
19.66
|
Balance
Sheet Data :
|
|||||
Total
Assets
|
$
136,898
|
$
129,131
|
$
130,677
|
$
227,648
|
$
242,665
|
Long-term
obligations
|
$
139,735
|
$
129,563
|
$
133,963
|
$
119,306
|
$
109,444
|
Dividends
per share
|
$
1.01
|
$
0.65
|
$
1.24
|
$
9.71
|
$
0.0
|
Total
|
2007
|
2008-2010
|
2011-2013
|
Thereafter
|
|
Long
Term Debt Obligations (a)
|
$109,707
|
$
263
|
$
11,844
|
$
97,600
|
--
|
Operating
Lease Obligations (b)
|
7,108
|
1,949
|
2,996
|
1,081
|
1,082
|
Other
Long Term Liabilities (c)
|
404
|
--
|
--
|
--
|
404
|
Total
|
$117,219
|
$2,212
|
$14,840
|
$98,681
|
$
1,486
|
(a)
|
Including
principal payments due on debt. For additional information, see
Note 8
"Long-Term Debt" in Item
8, Financial Statements and Supplementary
Data
|
(b)
|
For
U.S. operations only. Lease obligations of foreign subsidiaries
are not
material and therefore not included. For additional information,
see Note
12 "Commitments and Contingencies".
|
(c)
|
Includes
Deferred Tax Liability of $404 as reflected as a long-term liability
on
the Consolidated Balance Sheet as of December 31, 2006, included
herein in
Item
8, Financial Statements and Supplementary
Data.
|
INDEX
TO CONSOLIDATED FINANCIAL STATEMENTS OF THE GSI GROUP,
INC.
|
|
Page
|
|
Reports
of Independent Registered Public Accounting Firms
|
22
|
Consolidated
Balance Sheets as of December 31, 2006 and 2005
|
30
|
Consolidated
Statements of Operations for the years ended December 31, 2006,
2005 and
2004
|
31
|
Consolidated
Statements of Stockholders' Equity (Deficit) for the years ended
December
31, 2006, 2005 and 2004
|
32
|
Consolidated
Statements of Cash Flows for the years ended December 31, 2006,
2005 and
2004
|
33
|
Notes
to Consolidated Financial Statements
|
34
|
· |
Examining,
on a test basis, evidence supporting the amounts and disclosures
in the
financial statements,
|
· |
Assessing
the accounting principles used and significant estimates made by
management, and
|
· |
Evaluating
the overall financial statement
presentation.
|
Assets
|
2006
|
2005
|
Current
Assets:
|
||
Cash
and cash equivalents
|
$
3,467
|
$
2,522
|
Receivables,
net
|
42,553
|
35,801
|
Inventories,
net
|
51,332
|
46,746
|
Prepaids
|
3,069
|
2,961
|
Income
tax receivable
|
4,161
|
1,499
|
Deferred
taxes
|
6,971
|
4,645
|
Other
Current Assets
|
2,456
|
3,165
|
Total
current assets
|
114,009
|
97,339
|
Property,
Plant and Equipment, net
|
40,298
|
33,933
|
Other
Assets:
|
||
Goodwill
|
36,730
|
39,162
|
Other
intangible assets, net
|
47,497
|
51,684
|
Deferred
financing costs, net
|
3,921
|
5,105
|
Deferred
taxes, net
|
--
|
323
|
Other
|
210
|
102
|
Total
other assets
|
88,358
|
96,376
|
Total
assets
|
$
242,665
|
$
227,648
|
Liabilities
and Stockholders' Equity
|
||
Current
Liabilities:
|
||
Accounts
payable
|
$
23,334
|
$
20,989
|
Payroll
and payroll related expenses
|
9,814
|
6,683
|
Accrued
warranty
|
2,480
|
2,335
|
Accrued
interest
|
1,625
|
1,722
|
Workers
compensation
|
4,450
|
4,539
|
Other
accrued expenses
|
4,391
|
3,449
|
Customer
deposits
|
8,185
|
5,256
|
Current
maturities of long-term debt
|
263
|
876
|
Total
current liabilities
|
$
54,542
|
$
45,849
|
Long-Term
Debt, less
current maturities
|
109,444
|
119,306
|
Deferred
taxes, net
|
404
|
--
|
minority
interest
|
--
|
2,654
|
Stockholders'
Equity :
|
||
Common
stock, $.01 par value, voting (authorized 6,900,000
shares;
|
||
issued
6,633,652 shares; outstanding 626,948 shares)
|
66
|
66
|
Common
stock, $.01 par value, nonvoting (authorized 1,100,000
shares;
|
||
issued
1,059,316 shares; outstanding 200,000 shares)
|
11
|
11
|
Additional
paid-in capital
|
98,114
|
97,822
|
Accumulated
other comprehensive income
|
2,652
|
762
|
Retained
earnings
|
18,991
|
2,737
|
Treasury
stock, at cost, voting (6,006,704 shares)
|
(41,550)
|
(41,550)
|
Treasury
stock, at cost, nonvoting (859,316 shares)
|
(9)
|
(9)
|
Total
stockholders' equity
|
78,275
|
59,839
|
Total
liabilities and stockholders' equity
|
$
242,665
|
$
227,648
|
Successor
|
Predecessor
|
||||
Jan
1-Dec 31
|
May
17-Dec 31
|
Jan
1- May 16
|
Jan
1-Dec 31
|
||
2006
|
2005
|
2005
|
2004
|
||
Sales
|
$428,616
|
$229,509
|
$114,635
|
$288,131
|
|
Cost
of sales
|
333,783
|
180,066
|
86,323
|
220,822
|
|
Warranty
expense
|
1,290
|
1,238
|
(519)
|
2,869
|
|
Total
cost of sales
|
335,073
|
181,304
|
85,804
|
223,691
|
|
Gross
profit
|
93,543
|
48,205
|
28,831
|
64,440
|
|
Selling,
general and administrative expenses
|
47,093
|
30,449
|
22,978
|
37,887
|
|
FarmPRO
loss
|
--
|
--
|
--
|
7,152
|
|
Amortization
expense
|
4,287
|
6,047
|
166
|
649
|
|
Total
operating expenses
|
51,380
|
36,496
|
23,144
|
45,688
|
|
Operating
income
|
42,163
|
11,709
|
5,687
|
18,752
|
|
Other
income (expense):
|
|||||
Interest
expense
|
(14,302)
|
(9,836)
|
(5,238)
|
(14,104)
|
|
Interest
income
|
550
|
316
|
134
|
446
|
|
Foreign
currency transaction gain (loss)
|
--
|
--
|
--
|
(146)
|
|
Other,
net
|
(720)
|
(59)
|
573
|
(390)
|
|
Income
(loss) from continuing operations
before
income taxes and minority interest
|
27,691
|
2,130
|
1,156
|
4,558
|
|
Income
tax provision (benefit)
|
11,288
|
(796)
|
1,115
|
499
|
|
Minority
interest in net income from subsidiary
|
(149)
|
(73)
|
(105)
|
(92)
|
|
Income
(loss) from continuing operations
|
16,254
|
2,853
|
(64)
|
3,967
|
|
Discontinued
operations:
|
|||||
Gain
from sale of discontinued operations
|
--
|
--
|
--
|
118
|
|
Gain
(loss) from discontinued operations, net of income taxes
|
--
|
--
|
--
|
(93)
|
|
Net
income (loss)
|
$16,254
|
$2,853
|
$(64)
|
$
3,992
|
|
Basic
and diluted earnings (loss) per share
|
$19.66
|
$3.45
|
$(0.08)
|
$
3.06
|
|
Weighted
average common shares outstanding
|
826,948
|
826,948
|
826,948
|
1,304,870
|
|
Accumulated
|
||||||
Additional
|
Other
|
|||||
Common
|
Paid-In
|
Treasury
|
Comprehensive
|
Retained
|
Total
|
|
Stock
|
Capital
|
Stock
|
Income
(Loss)
|
Earnings
|
Equity
|
|
Predecessor:
|
||||||
Balance,
December 31, 2003
|
$77
|
$3,521
|
($26,959)
|
($11,584)
|
($3,365)
|
($38,310)
|
Net
income
|
$3,992
|
$3,992
|
||||
Other
Comprehensive Income
|
$1,460
|
$1,460
|
||||
Total
comprehensive income
|
$5,452
|
|||||
Stock
based compensation
|
$2,241
|
$2,241
|
||||
Purchase
of treasury stock (948,052 shares)
|
($14,600)
|
($14,600)
|
||||
Dividends
|
|
|
|
|
($1,618)
|
($1,618)
|
Balance,
December 31, 2004
|
$77
|
$5,762
|
($41,559)
|
($10,124)
|
($991)
|
($46,835)
|
Net
income (loss)
|
($64)
|
($64)
|
||||
Other
comprehensive income
|
$536
|
$536
|
||||
Total
comprehensive income
|
$472
|
|||||
Stock
based compensation
|
$2,841
|
$2,841
|
||||
Dividends
|
|
|
|
|
($7,913)
|
($7,913)
|
Balance,
May 16, 2005
|
$77
|
$8,603
|
($41,559)
|
($9,588)
|
($8,968)
|
($51,435)
|
Successor:
|
||||||
Change
in equity due to Acquisition
|
$89,219
|
$9,588
|
$8,968
|
$107,775
|
||
Net
income
|
$2,853
|
$2,853
|
||||
Other
comprehensive income
|
$762
|
$762
|
||||
Total
comprehensive income
|
$3,615
|
|||||
Dividends
|
|
|
|
|
($116)
|
($116)
|
Balance,
December 31, 2005
|
$77
|
$97,822
|
($41,559)
|
$762
|
$2,737
|
$59,839
|
Net
income
|
$16,254
|
$16,254
|
||||
Other
comprehensive income
|
$1,890
|
$1,890
|
||||
Total
comprehensive income
|
$18,144
|
|||||
Reduction
of purchase price
|
($2,096)
|
($2,096)
|
||||
Contribution
of capital
|
$2,096
|
$2,096
|
||||
Stock
option based award
|
$292
|
$292
|
||||
Balance,
December 31, 2006
|
$77
|
$98,114
|
($41,559)
|
$2,652
|
$18,991
|
$78,275
|
Successor
|
Predecessor
|
|||||
May
17-Dec 31
|
Jan
1- May16
|
|||||
2006
|
2005
|
2005
|
2004
|
|||
Cash
Flows From Operating Activities:
|
||||||
Net
income (loss)
|
$16,254
|
$2,853
|
$
(64)
|
$3,992
|
||
Adjustments
to reconcile net income (loss) to cash provided
|
||||||
by
operating activities:
|
||||||
Depreciation
and amortization
|
10,554
|
9,013
|
2,070
|
5,303
|
||
Amortization
of deferred financing costs
|
675
|
466
|
494
|
916
|
||
Loss
(gain) on sale of assets
|
(43)
|
(23)
|
(84)
|
452
|
||
Deferred
taxes
|
(1,599)
|
(3,590)
|
(69)
|
(244)
|
||
Minority
interest in subsidiary
|
70
|
404
|
884
|
625
|
||
Loss
on bond repurchase
|
933
|
--
|
--
|
--
|
||
Stock-based
compensation
|
292
|
--
|
2,841
|
2,241
|
||
Changes
in:
|
||||||
Accounts
receivable, net
|
(6,752)
|
243
|
(11,388)
|
2,427
|
||
Other
current assets, net
|
(1,762)
|
(5,879)
|
5,160
|
445
|
||
Inventories,
net
|
(4,586)
|
14,164
|
(6,968)
|
(6,268)
|
||
Accounts
payable
|
2,345
|
(1,028)
|
5,388
|
(510)
|
||
Payroll
and other accrued expenses
|
4,033
|
2,301
|
3,130
|
2,334
|
||
Customer
deposits
|
2,929
|
(385)
|
(1,449)
|
(1,785)
|
||
Net
cash flows provided by (used in) operating activities
|
23,343
|
18,539
|
(55)
|
9,928
|
||
Cash
Flows From Investing Activities:
|
||||||
Capital
expenditures
|
(11,766)
|
(3,958)
|
(2,046)
|
(6,322)
|
||
Proceeds
from sale of assets
|
178
|
83
|
268
|
1,657
|
||
Other
|
(108)
|
1,052
|
(48)
|
13
|
||
Net
cash flows provided by (used in) investing activities
|
(11,696)
|
(2,823)
|
(1,826)
|
(4,652)
|
||
Cash
Flows From Financing Activities:
|
||||||
Payments
on stockholder loans
|
--
|
(5,012)
|
--
|
(2,295)
|
||
Proceeds
from stockholder loans
|
--
|
--
|
12
|
7,146
|
||
Proceeds
from issuance of long-term debt
|
--
|
110,000
|
--
|
1,850
|
||
Payments
on debt
|
(13,113)
|
(144,160)
|
(90)
|
--
|
||
Net
borrowings under line-of-credit agreement
|
2,214
|
9,832
|
10,369
|
2,881
|
||
Deferred
financing costs
|
--
|
(3,108)
|
(407)
|
--
|
||
Contributed
capital
|
2,096
|
15,326
|
--
|
--
|
||
Purchase
of treasury stock
|
--
|
--
|
--
|
(14,600)
|
||
Purchase
of minority interest
|
(2,825)
|
--
|
--
|
--
|
||
Dividends
|
--
|
(116)
|
(7,913)
|
(1,619)
|
||
Other
|
986
|
1,511
|
50
|
169
|
||
Net
cash flows provided by (used in) financing activities
|
(10,642)
|
(15,727)
|
2,021
|
(6,468)
|
||
Effect
of Exchange Rate Changes on Cash
|
(60)
|
96
|
(7)
|
57
|
||
Change
in Cash and Cash Equivalents
|
945
|
85
|
$
133
|
$(1,135)
|
||
Cash
and Cash Equivalents, beginning
of year
|
2,522
|
2,437
|
2,304
|
3,439
|
||
Cash
and Cash Equivalents, end
of year
|
$3,467
|
$2,522
|
$
2,437
|
$
2,304
|
Company
Name
|
Location
|
The
GSI Asia Group Sdn.Bhd
|
Malaysia
|
GSI
Cumberland C.A.A.
|
Malaysia
|
The
GSI Group Africa (Proprietary) Limited
|
South
Africa
|
The
GSI Group (Europe) sp. Z o.o
|
Poland
|
GSI
Cumberland de Mexico, S. de R.L. de C.V.
|
Mexico
|
Agromarau
Industria E Comercio Ltda.
|
Brazil
|
The
GSI Group (Shanghai) Co., Ltd.
|
China
|
The
GSI Agricultural Equipments (Shanghai) Co., Ltd
|
China
|
Estimated
Useful Lives:
|
Years
|
Building
and Improvements
|
10-25
|
Machinery
and Equipment
|
3-10
|
Office
Equipment and Furniture
|
3-10
|
|
Amount
|
||
Balance,
December 31, 2003.
|
$
2,729
|
||
Increase
to operating expense
|
904
|
||
Charge
to allowance
|
(231)
|
||
Balance,
December 31, 2004
|
3,402
|
||
Increase
to operating expense
|
825
|
||
Charge
to allowance.
|
(2,281)
|
||
Balance,
December 31, 2005
|
1,946
|
||
Increase
to operating expense
|
1,674
|
||
Charge
to allowance
|
(509)
|
||
Balance,
December 21, 2006
|
$
3,111
|
||
For
the year ended December 31,
|
|||||
2006
|
2005
|
2004
|
|||
Grain
product line
|
$
256,817
|
$
190,188
|
$
177,622
|
||
Protein
product line
|
171,799
|
153,956
|
111,157
|
||
Discontinued
operations
|
--
|
--
|
(648)
|
||
Sales
|
$
428,616
|
$
344,144
|
$
288,131
|
2006
|
2005
|
||
(In
thousands)
|
|||
Receivables
|
|||
Trade
receivables
|
$
45,664
|
$
37,747
|
|
Allowance
for doubtful accounts
|
(3,111)
|
(1,946)
|
|
Total
|
$
42,553
|
$
35,801
|
|
Inventories
|
|||
Raw
materials
|
$
23,129
|
$
16,039
|
|
Work-in-process
|
9,777
|
8,758
|
|
Finished
goods
|
18,426
|
21,949
|
|
Total
|
$
51,332
|
$
46,746
|
|
Property,
Plant and Equipment
|
|||
|
Land
|
$
658
|
$
594
|
Buildings
and improvements
|
14,911
|
12,817
|
|
Machinery
and equipment
|
32,943
|
24,279
|
|
Office
equipment and furniture
|
3,719
|
2,523
|
|
Construction-in-progress
|
1,722
|
868
|
|
53,953
|
41,081
|
||
Accumulated
depreciation
|
(13,655)
|
(7,148)
|
|
Property,
plant and equipment, net
|
$
40,298
|
$
33,933
|
Intangible
Assets
|
|||
Goodwill-beginning
balance
|
$
39,162
|
$
10,264
|
|
Purchase
price adjustment
|
(2,432)
|
28,898
|
|
Goodwill-ending
balance
|
$
36,730
|
$
39,162
|
|
Non-compete
agreements
|
$
2,985
|
$
2,890
|
|
Technology
|
5,700
|
5,700
|
|
Trade
names
|
14,300
|
14,300
|
|
Customer
relations
|
31,400
|
31,400
|
|
Backlog
|
3,490
|
3,490
|
|
57,875
|
57,780
|
||
Accumulated
amortization
|
(10,378)
|
(6,096)
|
|
Total
|
$
47,497
|
$
51,684
|
|
Deferred
Financing Costs
|
|||
Deferred
financing costs
|
$
5,060
|
$
5,570
|
|
Accumulated
amortization
|
(1,139)
|
(465)
|
|
Total
|
$
3,921
|
$
5,105
|
Accrued
Warranty
|
|||
Beginning
reserve
|
$
2,335
|
$
2,764
|
|
Increase
to expense
|
1,290
|
1,087
|
|
Charge
to reserve
|
(1,145)
|
(1,
516)
|
|
Ending
reserve
|
$
2,480
|
$
2,335
|
|
Future
Amortization:
(in
thousands):
|
|
2007
|
$
4,262
|
2008
|
4,255
|
2009
|
4,211
|
2010
|
4,211
|
2011
|
4,211
|
Total
|
$21,150
|
2006
|
2005
|
||
Wachovia
Capital Finance revolving line of credit
|
$11,821
|
$
9,202
|
|
12%
senior subordinated notes payable, principal due May 2013, interest
payable
|
|||
semi-annually
each May 15 and November 15
|
97,600
|
110,000
|
|
CNH
Capital Financing, 0%, 5 year financing agreement, final payment
due 03/30
/2010
|
19
|
--
|
|
Brazil
note, secured by equipment, interest rate is LIBOR plus 1.5%, principal
due February 7, 2008
|
10
|
--
|
|
Brazil
note, secured by equipment, interest rate is LIBOR plus 4.5%, principal
due August 10, 2007
|
257
|
980
|
|
Total
|
109,707
|
120,182
|
|
Less:
|
|||
Current
maturities
|
(263)
|
(876)
|
|
Total
long-term debt
|
$109,444
|
$119,306
|
Maturities
of long term debt:
|
|
(in
thousands)
|
|
2007
|
$
263
|
2008
|
16
|
2009
|
6
|
2010
|
11,822
|
2011
|
--
|
Thereafter
|
97,600
|
Total
|
$
109,707
|
Option
Activity for the year ended December 31,2006:
|
||||
Options
|
Weighted
Average Exercise Price
|
Weighted
Average Remaining Contractual Term
|
Aggregate
Intrinsic Value
|
|
Outstanding
at 01/01/2006
|
58,200
|
$100
|
||
Granted
or modified
|
13,000
|
$120
|
||
Exercised
|
0
|
$0
|
||
Forfeited
or expired
|
0
|
$0
|
||
Outstanding
at 12/31/2006
|
71,200
|
$104
|
8.9
|
$0
|
Exercisable
at 12/31/2006
|
15,540
|
$101
|
9.0
|
$0
|
Successor
|
Predecessor
|
||||||||||||
Jan
1- Dec 31, 2006
|
May
17 - Dec 31, 2005
|
Jan
1 - May 16, 2005
|
Jan
1- Dec 31, 2004
|
||||||||||
Income/(loss)
|
Income
tax
|
Income/(loss)
|
Income
tax
|
Income/(loss)
|
Income
tax
|
Income/(loss)
|
Income
tax
|
||||||
before
|
expense/
|
before
|
expense/
|
before
|
expense/
|
before
|
expense/
|
||||||
income
taxes
|
(benefit)
|
income
taxes
|
(benefit)
|
income
taxes
|
(benefit)
|
income
taxes
|
(benefit)
|
||||||
U.S.
|
22,157
|
9,818
|
(651)
|
(520)
|
(564)
|
495
|
429
|
(374)
|
|||||
Brazil
|
2,125
|
633
|
828
|
356
|
1,051
|
336
|
1,879
|
569
|
|||||
Malaysia
|
1,476
|
380
|
1,126
|
107
|
(317)
|
(10)
|
532
|
102
|
|||||
Mexico
|
1,062
|
218
|
323
|
(116)
|
432
|
256
|
136
|
(41)
|
|||||
China
|
(130)
|
-
|
(130)
|
-
|
242
|
-
|
(78)
|
-
|
|||||
Poland
|
(141)
|
-
|
93
|
3
|
(2)
|
-
|
690
|
-
|
|||||
South
Africa
|
993
|
239
|
468
|
(626)
|
209
|
38
|
878
|
||||||
Total
|
$27,542
|
$11,288
|
$2,057
|
$(796)
|
$
1,051
|
$1,115
|
$
4,466
|
$499
|
|||||
Current
income taxes
|
12,887
|
2,794
|
1,184
|
101
|
|||||||||
Deferred
income taxes - foreign
|
735
|
(735)
|
(88)
|
(91)
|
|||||||||
Deferred
income taxes - US
|
(2,334)
|
(2,855)
|
19
|
489
|
|||||||||
Total
|
$11,288
|
$(796)
|
$1,115
|
$499
|
|||||||||
Successor
|
Predecessor
|
||||||||||||
Jan
1- Dec 31
|
May
16- Dec 31
|
Jan
1- May 15
|
Jan
1- Dec 31
|
||||||||||
2006
|
2005
|
2005
|
2004
|
||||||||||
Income
taxes at the U.S. statutory rate
|
9,640
|
720
|
368
|
1,563
|
|||||||||
Effect
of conversion to a "C" corp.
|
-
|
9
|
-
|
-
|
|||||||||
Purchase
accounting differences
|
-
|
(1,035)
|
-
|
-
|
|||||||||
State
income taxes
|
1,377
|
150
|
77
|
326
|
|||||||||
Foreign
tax rate differential-federal
|
1,462
|
344
|
620
|
918
|
|||||||||
Other
|
(1,191)
|
(984)
|
50
|
(2,308)
|
|||||||||
Total
|
$11,288
|
$
(796)
|
$1,115
|
$
499
|
|||||||||
The
components of deferred tax assets and liabilities at December 31,
2006 and
2005 (in thousands):
|
2006
|
2005
|
||
Deferred
tax assets:
|
|||
Tax
loss carry forwards - Brazil
|
$
1,183
|
$
1,220
|
|
Tax
loss carry forwards - Mexico
|
--
|
239
|
|
Tax
loss carry forwards - South Africa
|
326
|
627
|
|
Tax
loss carry forwards - Malaysia
|
--
|
45
|
|
Accrued
payroll
|
771
|
1,086
|
|
Accrued
self-insurance
|
197
|
255
|
|
Accrued
warranty
|
992
|
934
|
|
UNICAP
|
608
|
120
|
|
Litigation
reserve
|
304
|
265
|
|
Intangibles
|
--
|
841
|
|
Accrued
workers compensation
|
1,780
|
1,816
|
|
Allowance
for bad debt
|
478
|
--
|
|
Inventory
reserve
|
1,277
|
--
|
|
Other
accrued expenses
|
540
|
--
|
|
Nonqualified
stock option compensation expense
|
117
|
--
|
|
Other
|
534
|
20
|
|
Deferred
tax assets
|
$
9,107
|
$
7,468
|
|
Deferred
tax liabilities:
|
|||
Property
and equipment
|
(1,927)
|
(2,500)
|
|
Prepaid
insurance
|
(461)
|
--
|
|
Other
|
(152)
|
--
|
|
Deferred
tax liabilities
|
$(
2,540)
|
$(
2,500)
|
|
Net
deferred tax asset:
|
$
6,567
|
$4,968
|
2007
|
$1,949
|
2008
|
1,464
|
2009
|
967
|
2010
|
565
|
2011
|
439
|
Thereafter.
|
1,724
|
Total
|
$
7,108
|
2006
|
2005
|
2004
|
|||
United
States
|
$287.0
|
$231.7
|
$187.5
|
||
Asia
|
30.3
|
15.1
|
15.8
|
||
Canada
|
21.3
|
19.5
|
16.7
|
||
Latin
America
|
57.9
|
51.1
|
46.2
|
||
Mideast
and Africa
|
10.1
|
8.0
|
10.6
|
||
Europe
|
16.0
|
12.6
|
7.2
|
||
All
other
|
6.0
|
6.1
|
4.1
|
||
Total:
|
$428.6
|
$344.1
|
$288.1
|
||
16. |
Unaudited
Quarterly Information:
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
|
2006:
|
||||
Sales
|
$92,252
|
$113,548
|
$127,564
|
$95,252
|
Gross
profit
|
20,040
|
26,068
|
28,396
|
19,039
|
Net
income (loss)
|
2,470
|
5,992
|
6,138
|
1,654
|
Basic
and diluted earnings(loss) per share
|
2.99
|
7.25
|
7.42
|
2.00
|
2005:
|
||||
Sales
|
$72,674
|
$90,139
|
$107,723
|
$73,608
|
Gross
profit
|
17,105
|
20,155
|
28,025
|
11,752
|
Net
income (loss)
|
3,973
|
(4,359)
|
5,372
|
(2,197)
|
Basic
and diluted earnings(loss) per share
|
4.80
|
(5.27)
|
6.50
|
(2.66)
|
Name
|
Age
|
Office
|
William
Branch (1) (2)
|
61
|
Chief
Executive Officer, Chairman and Director
|
Richard
M. Christman (3)
|
56
|
Former
Chief Executive Officer
|
John
Henderson (4)
|
44
|
Chief
Financial Officer
|
Allen
A. Deutsch
|
56
|
President
of Protein Division
|
Dennis
E Schwieger
|
65
|
President
of Grain Division
|
William
A. Watson II
|
45
|
Vice
President of World Wide Engineering
|
Michael
Bond
|
44
|
Vice
President of Manufacturing, Grain
|
Michael
Fuqua
|
49
|
Vice
President, Supply Chain
|
Michael
W. Choe (1)
|
35
|
Independent
Director
|
Andrew
S. Janower(1)
|
38
|
Independent
Director
|
Kim
Davis(1)
|
53
|
Independent
Director
|
Paul
Farris(5)
|
60
|
Independent
Director
|
· |
to
attract, motivate, and retain talented and dedicated executives;
|
· |
to
motivate our executives to achieve goals inherent in our strategic
objectives;
|
· |
to
align executive and shareholder interests through equity based awards;
and
|
· |
to
provide a total compensation package that recognizes individual
contributions, as well as overall business
results
|
· |
align
executives and senior management with our strategic plan and critical
performance goals;
|
· |
motivate
and reward achievement of specific, measurable annual performance
objectives;
|
· |
provide
payouts commensurate with our
performance;
|
· |
provide
competitive total compensation opportunities;
and
|
· |
enable
us to attract, motivate and retain talented executive
management.
|
Name
|
Principal
Position
|
Salary
|
Bonus
(2)
|
Option
Awards (3)
|
Non-Equity
Incentive Plan Compensation (4)
|
All
Other Compensation (5)
|
Total
|
William
J. Branch
|
CEO
and Chairman
|
$126,000
|
--
|
--
|
--
|
$178,013
|
$304,013
|
Richard
M. Christman
|
Former
CEO
|
$277,500
|
--
|
$213,196
|
$49,167
|
$85,460
|
$625,323
|
John
Henderson
|
CFO
|
$176,923
|
$30,000
|
$6,695
|
$63,000
|
$53,890
|
$330,508
|
Dennis
E. Schwieger
|
President,
Grain
|
$175,000
|
$15,000
|
$7,718
|
$72,450
|
$94,926
|
$365,094
|
Michael
Bond
|
VP
of Manufacturing, Grain
|
$135,000
|
$15,000
|
$3,932
|
$42,525
|
$81,698
|
$278,155
|