ALANCO TECHNOLOGIES, INC.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
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EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2003
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
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For the transition period from to
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Commission file number 0-9347
ALANCO TECHNOLOGIES, INC.
(Exact name of small business issuer as specified in its charter)
Arizona
(State or other jurisdiction of incorporation or organization)
86-0220694
(I.R.S. Employer Identification No.)
15575 N. 83rd Way, Suite 3, Scottsdale, Arizona 85260
(Address of principal executive offices) (Zip Code)
(480) 607-1010
(Issuer's telephone number)
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(Former name, former address and former fiscal year,
if changed since last report)
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
As of February 1, 2004 there were 18,329,300 shares, net of treasury
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shares, of common stock outstanding.
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Transitional Small Business Disclosure Format (Check one): Yes No X
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Forward-Looking Statements: Some of the statements in this Form 10-QSB Quarterly
Report, as well as statements by the Company in periodic press releases, oral
statements made by the Company's officials to analysts and shareholders in the
course of presentations about the Company, constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Words or phrases denoting the anticipated results of future events such
as "anticipate," "believe," "estimate," "will likely," "are expected to," "will
continue," "project," "trends" and similar expressions that denote uncertainty
are intended to identify such forward-looking statements. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors that
may cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such factors include,
among other things, (i) general economic and business conditions; (ii) changes
in industries in which the Company does business; (iii) the loss of market share
and increased competition in certain markets; (iv) governmental regulation
including environmental laws; and (v) other factors over which the company has
little or no control.
INDEX
Page Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
December 31, 2003 (unaudited) and June 30, 2003............3
Condensed Consolidated Statements of Operations (Unaudited)
For the three months ended December 31,
2003 and 2002......................................... 4
Condensed Consolidated Statements of Operations (Unaudited)
For the six months ended December 31,
2003 and 2002..........................................5
Changes in Certain Equity and Preferred Stock Accounts
(unaudited)
For the six months ended December 31,
2003 and 2002..........................................6
Condensed Consolidated Statements of Cash Flows (Unaudited)
For the six months ended December 31,
2003 and 2002..........................................7
Notes to Condensed Consolidated Financial
Statements (Unaudited)................................ 9
Note A - Basis of Presentation
Note B - Inventories
Note C - Contracts in Process
Note D - Deferred Revenue
Note E - Loss per Share
Note F - Sale of Common Shares
Note G - IndustrySegment Data
Note H - Related Party Transactions
Note I - Line of Credit
Note J - Litigation
Note K - Subsequent Event
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ......................13
PART II. OTHER INFORMATION
Item 6. Exhibits .....................................................17
Signature ....................................................16
2
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2003 AND JUNE 30, 2003
ASSETS
Dec 31, 2003 June 30, 2003
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CURRENT ASSETS (unaudited)
Cash $ 59,100 $ 97,700
Accounts receivable, net 808,600 808,500
Subscription receivable -- 899,200
Inventories, net 1,645,400 1,278,700
Prepaid expenses and other current assets 129,900 53,100
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Total current assets 2,643,000 3,137,200
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PROPERTY, PLANT AND EQUIPMENT, NET 290,800 343,800
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OTHER ASSETS
Goodwill, net 5,356,300 5,351,300
Other intangible assets 801,700 911,700
Long-term notes receivable, net 148,500 291,000
Net assets held for sale 187,900 223,200
Other assets 55,100 61,200
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Total other assets 6,549,500 6,838,400
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TOTAL ASSETS $ 9,483,300 $ 10,319,400
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LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 1,450,600 $ 1,636,100
Credit line 61,000 874,000
Capital leases, current 11,800 24,600
Deferred revenue, current 59,400 76,000
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Total Current Liabilities 1,582,800 2,610,700
LONG TERM LIABILITIES
Notes payable and capital leases, long term 1,170,100 1,170,100
Deferred revenue, long term 25,200 25,200
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TOTAL LIABILITIES 2,778,100 3,806,000
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Preferred Stock - Series B, 500,000 shares
authorized, 57,300 and 54,500 shares issued
and outstanding, respectively 572,900 545,900
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SHAREHOLDERS' EQUITY
Preferred Stock - Series A Convertible,
5,000,000 shares authorized, 2,509,400
and 2,248,400 shares issued and
outstanding, respectively 2,954,000 2,653,200
Common Stock, 18,290,400 and 20,609,100
shares issued and 17,790,400 and 15,612,200
shares outstanding, respectively
64,665,300 65,014,000
Treasury Stock, 500,000 and 4,996,900
shares at cost
(375,200) (2,084,000)
Accumulated deficit (61,111,800) (59,615,700)
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Total shareholders' equity 6,132,300 5,967,500
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TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $ 9,483,300 $ 10,319,400
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See accompanying notes to the consolidated financial statements
3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31,
2003 2002
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NET REVENUES $ 1,234,100 $ 2,915,600
Cost of goods sold 755,900 1,889,800
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ROSS PROFIT 478,200 1,025,800
Selling, general and administrative expense 1,144,700 1,377,600
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LOFF FROM OPERATIONS (666,500) (351,800)
OTHER INCOME & EXPENSES
Interest income (expense), net (32,000) (26,700)
Other income (expense), net 37,100 (1,300)
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(661,400) (379,800)
Preferred stock dividend (14,500) (12,000)
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NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (675,900) $ (391,800)
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NET LOSS PER SHARE - BASIC AND DILUTED
Net loss attributable to common shareholders $ (0.04) $ (0.02)
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 16,402,100 17,605,500
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See accompanying notes to the consolidated financial statements
4
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
FOR THE SIX MONTHS ENDED DECEMBER 31,
2003 2002
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NET REVENUES $ 2,271,500 $ 5,307,200
Cost of goods sold 1,400,600 3,387,300
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GROSS PROFIT 870,900 1,919,900
Selling, general and administrative expense 2,264,500 2,711,300
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LOSS FROM OPERATIONS (1,393,600) (791,400)
OTHER INCOME & EXPENSES
Interest income (expense), net (114,700) (53,700)
Other income (expense) 39,200 6,000
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(1,469,100) (839,100)
Preferred stock dividend (27,000) (24,600)
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NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (1,496,100) $ (863,700)
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NET LOSS PER SHARE - BASIC AND DILUTED
Net loss attributable to common shareholders $ (0.09) $ (0.05)
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 15,789,200 17,319,200
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See accompanying notes to the consolidated financial statements
5
CONSOLIDATED STATEMENT OF CHANGES IN CERTAIN SHAREHOLDERS' EQUITY ACCOUNTS
FOR THE SIX MONTHS ENDED DECEMBER 31, 2003 (unaudited)
Common Stock Preferred Stock Preferred Stock Treasury Stock
Series A Series B
Shares Dollars Shares Dollars Shares Dollars Shares Dollars
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Balance @ 6/30/03 20,609,100 $65,014,000 2,248,400 $ 2,653,200 54,500 $545,900 4,996,900 $(2,084,000)
Ser. B Pfd dividends in kind, accrual 2,800 27,000
Shares issued for services and
cancellation of put option 171,700 60,200
Private Offerings 2,438,500 1,465,000 261,000 300,800 522,000 (198,400)
Options exercised 90,000 33,300
Cancelled Treasury Stock (5,018,900) (1,907,200) (5,018,900) 1,907,200
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Balances @ 12/31/03 18,290,400 $64,665,400 2,509,400 $ 2,954,000 57,300 $572,900 500,000 $ (375,200)
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6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
FOR THE SIX MONTHS ENDED DECEMBER 31,
2003 2002
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CASH FLOWS FROM OPERATING ACTIVITIES
Loss from operations $ (1,469,100) $ (839,100)
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation and amortization 172,800 219,900
Stock and warrants issued for services and
cancellation of stock put options charged to
interest expense 60,200 27,200
Income from assets held for sale (8,600) (7,500)
Gain on disposal of asset (1,000) --
Changes in:
Accounts receivable, net (100) (42,200)
Costs and estimated earnings in excess of billings
on uncompleted contracts -- (825,200)
Inventories, net (366,700) (67,800)
Prepaid expenses and other current assets (76,800) (145,300)
Accounts payable and accrued expenses (185,500) 883,000
Deferred revenue (16,600) --
Billings and estimated earnings in excess of costs
on uncompleted contracts -- (54,100)
Other assets 6,100 --
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Net cash provided by (used in) continuing operations (1,885,300) (851,100)
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CASH FLOWS FROM INVESTING ACTIVITIES
Net cash from assets held for sale 43,900 26,200
Collection of notes receivable 142,500 3,300
Purchase of property, plant and equipment (14,000) (41,100)
Proceeds from the sale of property, plant and equipment 5,200 --
Goodwill, acquisition (5,000) (30,700)
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Net cash used in investing activities 172,600 (42,300)
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CASH FLOWS FROM FINANCING ACTIVITIES
Advances on borrowings 1,205,000 1,366,000
Repayment on borrowings (1,780,800) (1,957,100)
Subscriptions receivable 899,200 --
Proceeds from sale of Preferred Stock 102,400 --
Proceeds from sale of Common Stock 1,248,300 1,395,000
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Net cash provided by (used in) financing activities 1,674,100 803,900
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NET INCREASE (DECREASE) IN CASH (38,600) (89,500)
CASH AND CASH EQUIVALENTS, beginning of period 97,700 328,400
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CASH AND CASH EQUIVALENTS, end of period $ 59,100 $ 238,900
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See accompanying notes to the consolidated financial statements
7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
FOR THE SIX MONTHS ENDED DECEMBER 31, (Continued)
2003 2002
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SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION
Net cash paid during the period for interest $ 114,700 $ 53,700
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Non-Cash Activities:
Value of stocks and warrants issued for services $ 60,200 $ 27,200
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Preferred stock dividend, in kind $ 27,000 $ 24,600
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Value of treasury stock redeemed in preferred stock
and warrant issuance $ 198,400 $ --
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Value of treasury stock cancelled $ 1,907,200 $ --
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Conversion of debt to equity $ 250,000 --
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See accompanying notes to the consolidated financial statements
8
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED DECEMBER 31, 2003
Note A - Basis of Presentation
Alanco Technologies, Inc., an Arizona corporation ("Alanco" or
"Company"), operates in two business Segments: Computer Data Storage Segment
and RFID Technology Segment.
The unaudited condensed consolidated balance sheet as of December 31,
2003 and the related unaudited condensed consolidated statements of operations
and cash flows for the six months ended December 31, 2003 presented herein have
been prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information and in accordance
with the instructions to Form 10-QSB. Accordingly, certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted. Accounting principles assume the continuation of the Company as a going
concern. The Company's auditors, in their opinion on the financial statements
for the year ended June 30, 2003, expressed a concern about this uncertainty.
The accompanying financial statements do not include any adjustment that might
arise from the outcome of this assumption. In our opinion, the accompanying
condensed consolidated financial statements include all adjustments necessary
for a fair presentation of such condensed consolidated financial statements.
Such necessary adjustments consist of normal recurring items and the elimination
of all significant intercompany balances and transactions.
These interim condensed consolidated financial statements should be
read in conjunction with the Company's June 30, 2003, Annual Report on Form
10-KSB. Interim results are not necessarily indicative of results for a full
year.
Certain reclassifications have been made to conform prior period
financials to the presentation in the current reporting period. The
reclassifications had no effect on net loss.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statement and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from these estimates.
All stock options issued to employees have an exercise price not less
than the fair market value of the Company's Common Stock on the date of grant.
In accordance with accounting for such options utilizing the intrinsic value
method under APB 25, there is no related compensation expense recorded in the
Company's financial statements for the three and six months ended December 31,
2003 and 2002. Had compensation cost for stock-based compensation been
determined based on the fair value of the options at the grant dates consistent
with the method of SFAS 123, the Company's net loss and loss per share would
have been increased to the pro forma amounts presented below:
9
6 months ended December 31, 3 months ended December 31,
2003 2002 2003 2002
----------- ----------- ----------- -----------
Net loss, as reported $(1,496,100) $ (863,700) $ (675,900) $ (391,800)
Add: Stock-based Employee compensation expense
included in reported income, net of related tax
effects -- -- -- --
Deduct: Total stock-based Employee compensation
expense determined under fair value based
methods for all awards, net of related tax
effects $ (294,300) $ (93,700) $ (39,000) $ (11,200)
----------- ----------- ----------- -----------
Pro forma net loss $ (1,790,400) $ (957,400) $ (714,900) $ (403,000)
============ =========== =========== ===========
Net loss per common share, basic and diluted
As reported $ (0.09) $ (0.05) $ (0.04) $ (0.02)
============ =========== =========== ===========
Pro forma $ (0.11) $ (0.06) $ (0.05) $ (0.02)
============ =========== =========== ===========
During the quarter ended December 31, 2003, the Company granted
employee stock options to purchase 150,000 shares of the Company's Class A
Common Stock at an average purchase price of $0.58, granted. The fair value of
option grants is estimated as of the date of grant,in accordance with SFAS 123,
utilizing the Black-Scholes option-pricing model, with the assumptions utilized
in the year end financial statements.
Recent Accounting Pronouncements
In May 2003, the FASB issued Statement of Financial Accounting
Standards No. 150 "Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity" (SFAS 150). This statement
affects the classification, measurement and disclosure requirements of the
following three types of freestanding financial instruments: 1) mandatory
redeemable shares, which the issuing company is obligated to buy back with cash
or other assets; 2) instruments that do or may require the issuer to buy back
some of its shares in exchange for cash or other assets, which includes put
options and forward purchase contracts; and 3) obligations that can be settled
with shares, the monetary value of which is fixed, tied solely or predominantly
to a variable such as a market index, or varies inversely with the value of the
issuers' shares. In general, SFAS 150 is effective at the beginning of the first
interim period beginning after June 15, 2003. The adoption of SFAS 150 did not
have an impact on the Company's consolidated financial position or disclosures.
10
Note B - Inventories
Inventories have been recorded at the lower of cost or market. The
composition of inventories as of December 31, 2003, and June 30, 2003, are
summarized as follows:
December 31, June 30,
2003 2003
-----------------------------
(unaudited)
Raw materials and purchased parts $ 1,313,400 $ 1,007,000
Work-in-progress 311,900 260,400
Finished goods 197,900 199,700
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1,823,200 1,467,100
Less reserves for obsolescence (177,800) (188,400)
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$ 1,645,400 $ 1,278,700
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Note C -Contracts In Process
As of December 31, 2003 the Company has no fixed price contracts in
progress that qualified for percentage-of-completion method of accounting.
Note D - Deferred Revenue
Deferred Revenues at December 31, 2003 and June 30, 2003 consist of
the following:
December 31, 2003 June 30, 2003
----------------- -------------
(unaudited)
Extended warranty revenue $ 84,600 $ 101,200
Less - current portion (59,400) (76,000)
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Deferred revenue - long term $ 25,200 $ 25,200
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Note E- Loss Per Share
Basic loss per share of common stock was computed by dividing net loss
by the weighted average number of shares outstanding of common stock.
Diluted earnings per share are computed based on the weighted average
number of shares of common stock and dilutive securities outstanding during the
period. Dilutive securities are options and warrants that are freely exercisable
into common stock at less than the prevailing market price. Dilutive securities
are not included in the weighted average number of shares when inclusion would
increase the earnings per share or decrease the loss per share. As of December
31, 2003 there were 6,918,657 potentially dilutive securities outstanding.
Note F - Sale of Common Shares
During the six months ended December 31, 2003, the Company raised a
totalof $1.56 million from institutional and other accredited investors through
the sale of Class A Common Shares. $250,000 of the amount was raised by the
conversion of a portion of the Company's credit line into Class A Common Shares
at $.50 per share, as provided in the line of credit agreement. $1 million was
raised by the sale of units consisting of one share of Class A Common Stock and
a warrant to purchase .5 shares at $.65 per unit. The warrants have a strike
11
price of $.75 per share and expire 120 days after the appropriate S-3
registration statement, which the Company has agreed to file, is effective. The
balance of the equity was raised from employees by exercising options under the
Company's option plans and other accredited investors, with the accredited
investors purchasing the Class A Common Shares at $.65 per share. Expense
incurred during the six months that were associated with the sale of common
shares amounted to approximately $61,000, resulting in net proceeds from the
sale of Class A Common Shares of $1.5 million.
Note G -Segment Data
Information concerning operations by industry segment follows (unaudited):
Six Months Ended 12/31 Three Months Ended 12/31
2003 2002 2003 2002
----------- ----------- ----------- -----------
Revenue
Data Storage $ 2,246,700 $ 2,092,400 $ 1,211,300 $ 1,183,300
TSI PRISM 24,800 3,214,800 22,800 1,732,300
----------- ----------- ----------- -----------
Total Revenue 2,271,500 5,307,200 1,234,100 2,915,600
----------- ----------- ----------- -----------
Gross profit
Data Storage 863,900 894,500 468,000 494,600
TSI PRISM 7,000 1,025,400 10,200 531,200
----------- ----------- ----------- -----------
Total Gross Profit 870,900 1,919,900 478,200 1,025,800
Operating Profit/Loss
Data Storage 41,800 (221,100) 64,000 (52,000)
TSI PRISM (986,700) (111,900) (487,200) (68,500)
Corporate Expense (448,700) (458,400) (243,300) (231,300)
----------- ----------- ----------- -----------
Operating Loss $(1,393,600) $ (791,400) $ (666,500) $ (351,800)
=========== =========== =========== ===========
Depreciation and Amortization
Data Storage $ 15,500 $ 64,100 $ 7,500 $ 27,800
TSI PRISM 153,800 151,000 76,900 76,400
Corporate 3,500 4,800 1,200 2,100
----------- ----------- ----------- -----------
Total Depreciation and Amortization $ 172,800 $ 219,900 $ 85,600 $ 106,300
=========== =========== =========== ===========
Note H- Related Party Transactions
The Company has a line of credit agreement ("Agreement"), more fully
discussed in the Company's Form 10-KSB for the year ended June 30, 2003, with a
private trust controlled by Mr. Donald Anderson, a greater than five percent
stockholder and a member of the Company's Board of Directors. During the current
quarter, the Company entered into an amendment to the Agreement with the private
trust that modified the Agreement and extended the existing line of credit to
July 1, 2005. See Note I below for additional discussion of the amendment to the
line of credit agreement.
Note I - Line of Credit
At December 31, 2003, the Company has an outstanding balance of
$561,000, of which $61,000 is presented as line of credit balance due and
$500,000 is presented as notes payable - long term portion. The outstanding
balance is under a $1.55 million line of credit agreement with a private trust
("Lender"), entered into in June 2002 and modified in April and October of 2003
(the "Agreement"). During the October 2003 negotiations, the Lender indicated a
12
desire to convert $250,000 of debt into equity as provided for in the Agreement
and agreed to complete the conversion by November 14, 2003. As compensation to
the Lender for amending and extending the Agreement, the Company agreed to
continue maintaining a $500,000 minimum outstanding balance subsequent to the
$250,000 conversion of debt to equity and to issue the Lender warrants to
purchase 50,000 shares of the Company's Class A Common Stock at $.60 per share,
the fair market value on the date of the Agreement.
Note J - Litigation
The Company continues to be a defendant in litigation that relates to
the acquisition, in May of 2002, of substantially all the assets of Technology
Systems International, Inc. a Nevada corporation, and to litigation arising from
an expired property lease between the Company's subsidiary, Arraid, Inc. and
Arraid Property L.L.C., a Limited Liability Company. No significant new activity
has occurred subsequent to our report of litigation in our Form 10-KSB filed for
the year ended June 30, 2003. The Company's management, in consultation with
legal counsel, believes the plaintiffs' claims are without merit and the Company
will aggressively defend the actions.
Note K - Subsequent Events
During January 2004, the Company entered into an agreement with EMS
Technologies, Inc. ("EMS") whereby TSI purchased various inventory and tooling
from EMS, resolved various obligations of both EMS and TSI, and converted
approximately $539,000 of notes payable and accounts payable into equity through
the issuance of Class A Common Stock valued at $1 per share. As part of the
agreement, the Company committed to file an appropriate Form S-3 registration
statement pertaining to the 539,000 shares within the next 30 days.
Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Except for historical information, the statements contained herein are
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. All such forward-looking
statements are subject to risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by those
statements. These risks and uncertainties include, but are not limited to, the
following factors: general economic and market conditions; reduced demand for
information technology equipment; competitive pricing and difficulty managing
product costs; development of new technologies which make the Company's products
obsolete; rapid industry changes; failure by the Company's suppliers to meet
quality or delivery requirements; the inability to attract, hire and retain key
personnel; failure of an acquired business to further the Company's strategies;
the difficulty of integrating an acquired business; undetected problems in the
Company's products; the failure of the Company's intellectual property to be
adequately protected; unforeseen litigation; the ability to maintain sufficient
liquidity in order to support operations; the ability to maintain satisfactory
relationships with lenders and to remain in compliance with financial loan
covenants and other requirements under current banking agreements; and the
ability to maintain satisfactory relationships with suppliers and customers.
General
Information on industry segments is incorporated by reference from Note
G - Segment Reporting to the Condensed Consolidated Financial Statements.
Critical Accounting Policies and Estimates
Management's discussion and analysis of financial condition and results
of operations are based upon the condensed consolidated financial statements,
which have been prepared in accordance with accounting principles generally
accepted in the United States of America. The preparation of our financial
statements requires the use of estimates and judgments that affect the reported
13
amounts of assets, liabilities, revenues and expenses, and related disclosure of
contingent liabilities. On an ongoing basis, estimates are revalued, including
those related to areas that require a significant level of judgment or are
otherwise subject to an inherent degree of uncertainty. These areas include
allowances for doubtful accounts, inventory valuations, carrying value of
goodwill and intangible assets, estimated profit on uncompleted TSI PRISM
contracts in process, income and expense recognition, income taxes and
commitments and contingencies. Our estimates are based upon historical
experience, observance of trends in particular areas, information and/or
valuations available from outside sources and on various other assumptions that
we believe to be reasonable under the circumstances and which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual amounts may differ from these
estimates under different assumptions and conditions.
Accounting policies are considered critical when they are significant
and involve difficult, subjective or complex judgments or estimates. We
considered the following to be critical accounting policies:
Principles of consolidation - The consolidated financial statements
include the accounts of the Company and its wholly owned subsidiaries. All
material intercompany accounts and transactions have been eliminated in
consolidation.
Revenue recognition - The Company recognizes revenue from the Data
Storage Segment, net of anticipated returns, at the time products are shipped to
customers, or at the time services are provided. Revenue from material long-term
contracts (in excess of $250,000 and over a 90-day completion period) in both
the Data Storage Segment and the RFID Technology Segment are recognized on the
percentage-of-completion method for individual contracts, commencing when
significant costs are incurred and adequate estimates are verified for
substantial portions of the contract to where experience is sufficient to
estimate final results with reasonable accuracy. Revenues are recognized in the
ratio that costs incurred bear to total estimated costs. Changes in job
performance, estimated profitability and final contract settlements would result
in revisions to cost and income, and are recognized in the period in which the
revisions were determined. Contract costs include all direct materials,
subcontracts, labor costs and those direct and indirect costs related to
contract performance. General and administrative costs are charged to expense as
incurred. At the time a loss on a contract becomes known, the entire amount of
the estimated ultimate loss is accrued.
Long-lived assets and intangible assets - The Company reviews carrying
values at least annually or whenever events or circumstances indicate the
carrying values may not be recoverable through projected discounted cash flows.
Results of Operations
(A) Three months ended 12/31/2003 versus 12/31/2002
Consolidated revenue for the quarter ended December 31, 2003 was
$1,234,100, compared to $2,915,600 for the comparable quarter of the previous
year, a decrease of $1,681,500, or 57.7%. The decrease is attributed to a
decrease of the RFID Technology revenue, which decreased from $1,732,300 for the
quarter ended December 31, 2002 to $22,800 in the comparable current
quarter. The Data Storage Segment revenues increased to $1,211,300, a 2.4%
increase compared to $1,183,300 reported in the quarter ended December 31, 2002.
The decrease in RFID Technology revenue resulted from prison contract award and
funding postponements caused by fiscal budgetary constraints and the aftermath
of the November 2002 elections where several new administrations were elected
that added further delays to the already lengthy state contract procurement
process. The increase in Data Storage Segment revenues resulted from increased
demand for the Company's data storage products.
The Loss from Operations for the quarter was $666,500, compared to a
loss of $351,800 for the same quarter of the prior year, an increase of 89.5%.
The increased operating loss resulted from a $487,200 operating loss generated
by the RFID Technology Segment, an increase of $418,700 compared to an operating
loss of $68,500 reported for the same quarter of the prior year. Reflecting a
significant turnaround from prior quarters, the Data Storage Segment reported an
operating profit of $64,000, a $116,000 increase from the $52,000 operating loss
reported for the quarter ended December 31, 2002. The Data Storage improvement
in operating income resulted from increased Data Storage revenues and cost
reduction programs instituted by the Company.
14
Interest expense for the quarter amounted to $32,000, an increase of
$5,300 when compared to interest expense of $26,700 for the same quarter in the
prior year. The Company also paid in-kind preferred stock dividends with values
of $14,500 and $12,000 in fiscal year 2003 and 2002, resulting in the Net Loss
Attributable to Common Stockholders of $675,900, or ($.04) per share, compared
to a loss of $391,800, or ($.02) per share, in the comparable quarter of the
prior year. Although the Company has initiated cost control measures that have
impacted the current quarter, operating results have continued to be affected by
unfavorable economic conditions and reduced capital spending that have adversely
affected Alanco's business in recent quarters. If the economic conditions in the
United States worsen or if a wider or global economic slowdown occurs, Alanco
may experience a material adverse impact on its operating results and business
conditions.
Selling, general and administrative expenses for the current quarter
decreased to $1,144,700, a $232,900 decrease, or 16.9%, when compared to
$1,377,600 incurred in the comparable quarter of fiscal year 2002. The decrease
is attributable to reduced sales commissions in the RFID Technology Segment and
cost control measures initiated by the Company in the Data Storage Segment.
(B) Six months ended 12/31/2003 versus 12/31/2002
Consolidated revenue for the six months ended December 31, 2003 was
$2,271,500, compared to $5,307,200 for the comparable period of the previous
year, a decrease of $3,035,700, or 57.2%. The decrease in revenue is attributed
to a decrease of the RFID Technology revenue, which decreased from $3,214,800
for the six months ended December 31, 2002 to $24,800 in the comparable current
year six-month period. The Data Storage Segment revenues increased to
$2,246,700, a 7.4% increase compared to $2,092,400 reported for the period ended
December 31, 2002. The decrease in RFID Technology revenue resulted from prison
contract award and funding postponements caused by fiscal budgetary constraints
and the aftermath of the November 2002 elections where several new
administrations were elected that added further delays to the already lengthy
state contract procurement process. The increase in Data Storage Segment
revenues resulted from increased demand for the Company's data storage products.
The Loss from Operations for the period was $1,393,600, compared to a
loss from operations of $791,400 for the same quarter of the prior year, an
increase of 76.1%. The increased operating loss from operations resulted from
a $986,700 operating loss generated by the RFID Technology Segment, an increase
of $874,800 compared to an operating loss of $111,900 reported for the same
period of the prior year. The Data Storage Segment operating income of $41,800
was a significant improvement over the $221,100 operating loss reported for the
six-month period ended December 31, 2002.
Interest expense for the six-month period amounted to $114,700, an
increase of $61,000 when compared to interest expense of $53,700 for the same
period in the prior year. Included in interest expense for the current period is
$49,900, reflecting the value of shares issued to terminate a Common Stock put
option.
For the six-month period the Company paid an in-kind preferred stock
dividend with a value of $27,000, compared to $24,600 paid in the previous
fiscal year, resulting in the Net Loss Attributable to Common Stockholders of
$1,496,100, or ($.09) per share, compared to a loss of $863,700, or ($.05) per
share, in the comparable period. Although the Company has initiated cost control
measures that have impacted the current six-month period, operating results,
especially in the RFID Technology Segment, have continued to be affected by
unfavorable economic conditions and reduced capital spending that have adversely
affected Alanco's business in recent quarters. If the economic conditions in the
United States worsen or if a wider or global economic slowdown occurs, Alanco
may experience a material adverse impact on its operating results and business
conditions.
Selling, general and administrative expenses for the current six-month
period decreased to $2,264,500, a $446,800 decrease, or 16.5%, when compared to
$2,711,300 incurred in the comparable six-month period of fiscal year 2002. The
decrease is attributable to reduced sales commissions in the RFID Technology
Segment and cost control measures initiated by the Company in the Data Storage
Segment.
15
Liquidity and Capital Resources
The Company's current assets at December 31, 2003 exceeded current
liabilities by $1,060,200, resulting in a current ratio of 1.67 to 1. At June
30, 2003 the Company's current assets exceeded current liabilities by $526,500,
reflecting a current ratio of 1.20 to 1. The increase in the current ratio for
the period resulted from additional equity raised that was used to reduce the
credit line, offset by continuing operating losses. Accounts receivable of
$808,600 at December 31, 2003, reflects a status quo when compared to the
$808,500 reported as consolidated accounts receivables at June 30, 2003. The
accounts receivable balance at December 31, 2003 represented forty-six days'
sales in receivables compared to twenty-nine days' sales at June 30, 2003. The
increase in days' sales in receivables resulted from a delay in final contract
payments in the RFID Technology Segment that had recognized the revenue during
the previous quarter.
Consolidated inventories at December 31, 2003 amounted to $1,645,400,
an increase of $366,700 when compared to $1,278,700 at June 30, 2003. $279,400
of the increase resulted from Data Storage Segment increases required for
anticipated increases in Data Storage sales, and the RFID Technology inventory
increase was the result of increases in inventory in anticipation of contract
awards.
At December 31, 2003, the Company had a balance of $561,000 (including
$500,000 classified as long term notes payable) under a $1.55 million
formula-based revolving bank line of credit agreement with interest calculated
at prime plus 4%. The line of credit agreement formula is based upon current
asset values and is used to finance working capital. At December 31, 2003, the
Company had $989,000 available under the line of credit. See Line of Credit
Footnote I above for a discussion of certain modifications and extension of the
existing line of credit agreement executed during the quarter ended December 31,
2003.
Cash used in operations for the six-month period was $1,885,300, an
increase of $1,024,200 when compared to cash used in operations of $851,100 for
the comparable period ended December 31, 2002. The increase in cash used in
operations was due primarily to increases in the loss from operations for the
period, increase in inventory balances and a reduction in accounts payable and
accrued expenses.
During the six-month period ended December 31, 2003, the Company
collected $899,200 in subscription receivables and purchased $14,000 of
additional equipment, compared to equipment purchases of $41,100 in the
comparable period of the prior year. Net proceeds from stock sales for the
six-month period amounted to $1,450,700, compared to $1,395,000 in the
comparable prior period. Repayment on borrowings during the period amounted to
$1,780,800, while advances from borrowings amounted to $1,205,000.
The Company believes that additional cash resources may be required for
working capital to achieve planned operating results for fiscal year 2004 and,
if working capital requirements exceed current availability, the Company
anticipates raising capital through additional borrowing or sale of stock. The
additional capital would supplement the projected cash flows from operations and
the line of credit agreement in place at December 31, 2003. If additional
working capital was required and the Company was unable to raise the required
additional capital, it may materially affect the ability of the Company to
achieve its financial plan. See Footnote F - Sale of Common Stock and Footnote K
- Subsequent Events, for additional information related to working capital
raised by the Company during the six-months ended December 31, 2003, necessary
to achieve planned operating results for the current fiscal year.
CONTROL AND PROCEDURES
The Company maintains disclosure controls and procedures designed to
ensure that it is able to collect the information it is required to disclose in
16
the reports it files with the Securities and Exchange Commission (SEC), and to
process, summarize and disclose this information within the time periods
specified in the rules of the SEC. Based on various evaluations of the Company's
disclosure controls and procedures, some of which occurred during the 90 days
prior to the filing date of this report, the Chief Executive and Chief Financial
Officers believe that these controls and procedures are effective to ensure that
the Company is able to collect, process and disclose the information it is
required to disclose in the reports it files with the SEC within the required
periods.
The Company also maintains a system of internal controls designed to
provide reasonable assurance that: transactions are executed in accordance with
management's general or specific authorization; transactions are recorded as
necessary (1) to permit preparation of financial statements in conformity with
generally accepted accounting principles, and (2) to maintain accountability for
assets. Access to assets is permitted only in accordance with management's
general or specific authorization; and the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
Since the date of the most recent evaluation of the Company's internal
controls by the Chief Executive and Chief Financial Officers, there have been no
significant changes in such controls or in other factors that could have
significantly affected those controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.
PART II. OTHER INFORMATION
Item 1 - LEGAL PROCEEDINGS
The Company continues to be a defendant in litigation that relates to
the acquisition, in May of 2002, of substantially all the assets of Technology
Systems International, Inc., a Nevada corporation, and to litigation arising
from an expired property lease between the Company's subsidiary, Arraid, Inc.
and Arraid Property L.L.C., a Limited Liability Company. No significant new
activity has occurred subsequent to our report of litigation in our Form 10-KSB
filed for the year ended June 30, 2003. The Company's management, in
consultation with legal counsel, believes the plaintiffs' claims are without
merit and the Company will aggressively defend the actions.
Item 2 - CHANGES IN SECURITIES
During the six months ended December 31, 2003, the Company issued
261,000 shares of Series A Preferred Stock related to the offering more fully
discussed in Note F, 2,528,500 shares of Class A Common Stock in private
transactions and employee stock options exercised, and 171,700 shares of Common
Stock for services rendered and cancellation of put options.
Item 6. EXHIBITS
10.1 EMS Supply Agreement
10.2 EMS Supply Agreement Amendment
31.1 Certification of Chief Executive Officer
31.2 Certification of Chief Financial Officer
32.1 Certification of Chief Executive Officer and Chief Financial
Officer
17
SIGNATURE
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 thereunder duly authorized.
ALANCO TECHNOLOGIES, INC.
(Registrant)
/s/ John A. Carlson
John A. Carlson
Executive Vice President and
Chief Financial Officer
18
EXHIBIT 31.1
Certification of
Chairman and Chief Executive Officer
of Alanco Technologies, Inc.
I, Robert R. Kauffman, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Alanco
Technologies, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report.
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the period presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(c) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and
5. The registrant's other certifying officer(s) and I have disclosed, based
on our most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal control
over financial reporting.
Date: February 17, 2004
/s/ Robert R. Kauffman
---------------------
Robert R. Kauffman
Chairman and Chief Executive Officer
19
EXHIBIT 31.2
Certification of
Vice President and Chief Financial Officer
of Alanco Technologies, Inc.
I, John A. Carlson, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Alanco
Technologies, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report.
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the period presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(c) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and
5. The registrant's other certifying officer(s) and I have disclosed, based
on our most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal control
over financial reporting.
Date: February 17, 2004
/s/ John A. Carlson
---------------------
John A. Carlson
Vice President and Chief Financial Officer
20
EXHIBIT 32.1
Certification of
Chief Executive Officer and Chief Financial Officer
of Alanco Technologies, Inc.
This certification is provided pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 and accompanies this quarterly report of Form 10-QSB
(the "Report") for the period ended December 31, 2003 of Alanco Technologies,
Inc. (the "Issuer").
Each of the undersigned, who are the Chief Executive Officer and Chief
Financial Officer, respectively, of Alanco Technologies, Inc., hereby certify
that, to the best of each such officer's knowledge:
(i) the Report fully complies with the requirements of Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or
78o(d)); and
(ii) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Issuer.
Dated: February 17, 2004
/s/ Robert R. Kauffman
----------------------
Robert R. Kauffman
Chief Executive Officer
/s/ John A. Carlson
----------------------
John A. Carlson
Chief Financial Officer
21
EXHIBIT 10.1
EMS Assignment Agreement
This Assignment Agreement is made this 15th day of March, 2002, by
and among EMS Technologies, Inc., a Georgia corporation("EMS"), Technology
Systems International, Inc., a Nevada corporation ("TSI"), and Alanco
Technologies, Inc., an Arizona corporation ("Alanco").
Whereas, EMS holds a promissory note in the principal amount of
$1,167,000 dated December 23, 2000 and maturing December 31, 2001, executed to
its order by TSI (the "TSI Note"), which TSI Note was issued to EMS to evidence
amounts owed by TSI for products heretofor delivered by EMS to TSI;
Whereas, Alanco and TSI are parties to an Acquisition Agreement, of
even date herewith, providing for the acquisition by Alanco of all assets and
assumption of certain identified liabilities of TSI (the "Acquisition
Agreement"), subject to, among other things, the negotiation of arrangements
acceptable to Alanco concerning TSI's rights and obligations under supply
arrangement between EMS and TSI and the TSI Note; and
Whereas, the parties have agreed to the transfer of the TSI Note to
Alanco, all on the terms and conditions set forth in this Agreement.
Now, therefore, in consideration of the mutual promises and benefits
set forth herein, the parties hereby agree as follows:
1. Assignment of TSI Note. Effective simultaneously with and subject
to the closing of the Acquisition Agreement following the approval
thereof by the shareholders of Alanco (the "Closing"), EMS hereby assigns and
transfers the TSI Note to Alanco, free and clear of any liens, encumbrances or
other interests of any third party. Such transfer shall be further evidenced
by delivery to Alanco of the TSI Note, duly endorsed for transfer to the order
of Alanco.
2. Consideration to EMS. In consideration of the assignment of the
TSI Note, Alanco shall:
a. Deliver to EMS, at the Closing, 1,000,000 shares of Alanco
Common Stock, no par value (the "Alanco Stock");
b. Deliver to EMS, at the Closing, its promissory notes (the
"Alanco Notes"), on the terms and in the forms attached as Annexes A and B to
this Agreement; and
c. Deliver to EMS, not later than the seventh calendar day after
the Closing, $25,000 paid by check or wire transfer.
3. Restricted Status of Alanco Common Stock. EMS acknowledges that the
Alanco Stock, together with any shares of Alanco Common Stock issued upon
conversion of the Alanco Note in the form attached as Annex B, will be
"restricted securities" under the Securities Act of 1933, as amended (the "1933
Act"), and will bear a legend worded substantially as follows:
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ISSUED WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ARIZONA OR ANY OTHER STATE, PURSUANT TO EXEMPTIONS THEREUNDER. SUCH
SHARES MAY NOT BE TRANSFERRED OTHER THAN IN A TRANSACTION THAT IS REGISTERED
UNDER THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR AS TO WHICH IT
IS ESTABLISHED TO THE SATISFACTION OF COUNSEL TO THE ISSUER THAT SUCH
TRANSACTION IS EXEMPT FROM REGISTRATION THEREUNDER.
The foregoing legend on the certificates representing Alanco Common
Stock shall be removed by delivery of substitute certificates without such
legend, at such time as such legend is not required for purposes of the 1933
Act. It is agreed that such restrictive legends and related stop orders will be
removed if (i) Alanco has received either a written opinion of counsel, which
such counsel and opinion shall be reasonably satisfactory to Alanco, or a "no
action" letter obtained from the SEC, to the effect that the Alanco Common Stock
subject thereto may be transferred free of the restrictions imposed by Rule 144,
or (ii) in the event of a sale of the Alanco Common Stock which has been
registered under the Securities Act or made in conformity with the provisions of
Rule 144.
4. Registration of Alanco Stock. Alanco and EMS agree that the rights
and obligations of Alanco and EMS with respect to the registration by Alanco of
the Alanco Stock, under the 1933 Act and applicable state laws, for resale by
EMS shall be as set forth in Exhibit B to the Acquisition Agreement.
5. Representations and Warranties of Alanco. Alanco represents and
warrants to EMS that each of the following statements is true and accurate on
the date hereof and will be true and accurate as of the Closing:
a. Corporate Status. Alanco is a corporation duly incorporated,
organized, subsisting and in good standing under the laws of the State of
Arizona, and is duly qualified to transact business in all jurisdictions in
which such qualification is required, except where the failure to qualify could
not be reasonably expected to have a material adverse effect on the business
operations or financial condition of Alanco.
b. Authority. Alanco has all necessary power and authority
(corporate and otherwise) to own, lease and operate its assets and other
properties and to carry on business as it is now being conducted. Alanco is duly
authorized to enter into this Agreement and to perform all its obligations and
do all other things and take all other actions required or contemplated hereby
or thereby. This Agreement has been duly executed and delivered by Alanco and,
assuming the due authorization, execution and delivery hereof by the other
parties to this Agreement, constitutes the legal, valid and binding obligation
of Alanco, enforceable against Alanco in accordance with its terms.
c. Authorized Alanco Stock. The authorized capital stock of Alanco
consists of 100,000,000 shares of common stock, no par value, of which there are
(i) 10,220,100 shares issued and outstanding, (ii) 5,000,000 shares of Class A
Cumulative Convertible Preferred Shares, of which there are no shares issued and
outstanding, and (iii) 20,000,000 shares of Class B Cumulative Convertible
Preferred Shares, of which there are no shares issued and outstanding. Upon
delivery pursuant to this Agreement, the Alanco Stock, together with any shares
of the Alanco Common Stock issued upon conversion of the Alanco Note in the form
attached as Annex B, will be duly authorized, validly issued, fully-paid and
non-assessable shares of the Common Stock, no par value per share, of Alanco,
free of preemptive rights.
d. No Violations. Neither this Agreement nor Alanco's performance
of its obligations hereunder will contravene, violate or result in a breach of
(i) the Articles of Incorporation, Bylaws or other organizational documents of
Alanco, (ii) any agreement, obligation or commitment to which Alanco is a party
or by which it is bound, or (iii) any applicable requirement, judgment, order or
restriction of any court or other governmental entity, and no consent of, notice
to or filing with any person is required for the performance by Alanco of the
transactions contemplated by or its obligations under this Agreement, other than
filings under the Securities Act of 1933, as amended (the "1933 Act"), the
Securities Exchange Act of 1934, as amended (the "1934 Act"), or as required by
the rules and regulations of the National Association of Securities Dealers,
Inc.
e. Alanco Public Filings; Financial Statements.
(i) Since December 31, 1999, Alanco has filed all forms,
reports, statements and other documents required to be filed with the SEC,
including without limitation (i) all Annual Reports on Form 10-K, (ii) all
Quarterly Reports on Form 10-Q, (iii) all proxy statements relating to meetings
of shareholders (whether annual or special), (iv) all Current Reports on Form
8-K and (v) all other reports, schedules, registration statements or other
documents (collectively referred to as the "Alanco Public Filings"). The Alanco
Public Filings were prepared in all material respects in accordance with the
requirements of applicable legal requirements (including the 1933 Act or 1934
Act, as the case may be, and the applicable rules and regulations of the SEC
thereunder, and the Alanco Public Filings did not at the time they were filed
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading.
(ii)Each of the historical consolidated financial statements
(including, in each case, any related notes thereto) contained in the Alanco
Public Filings (i) have been prepared in accordance with the published rules and
regulations of the SEC and GAAP applied on a consistent basis throughout the
periods involved (except (A) to the extent disclosed therein or required by
changes in GAAP, (B) as may be indicated in the notes thereto and (C) in the
case of the unaudited financial statements, as permitted by the rules and
regulations of the SEC) and (ii) fairly present the consolidated financial
position of Alanco and its subsidiaries as of the respective dates thereof and
the consolidated results of operations and cash flows for the periods indicated
(subject, in the case of unaudited consolidated financial statements for interim
periods, to adjustments, consisting only of normal, recurring accruals,
necessary to present fairly such results of operations and cash flows).
(iii) Except as disclosed in the Alanco Public Filings filed
prior to the date of this Agreement or as contemplated by this Agreement, since
June 30, 2001, Alanco and its subsidiaries have conducted their respective
businesses only in the ordinary course and in a manner consistent with past
practice and there has not been any event causing or constituting a material
adverse effect on the business operations or financial condition of Alanco,
other than issuance of shares of Alanco common stock in connection with a
private offering thereof, and general market conditions in Alanco's computer
storage businesses.
6. Representations and Warranties of EMS. EMS represents and warrants
to Alanco that each of the following statements is true and accurate on the date
hereof and will be true and accurate as of the Closing:
a. Corporate Status. EMS is a corporation duly incorporated,
organized, subsisting and in good standing under the laws of the State of
Georgia, and is duly qualified to transact business in all jurisdictions in
which such qualification is required, except where the failure to qualify could
not be reasonably expected to have an material adverse effect on the business
operations or financial condition of EMS.
b. Authority. EMS is duly authorized to enter into this Agreement
and to perform all its obligations and do all other things and take all other
actions required or contemplated hereby or thereby. This Agreement has been duly
executed and delivered by EMS and, assuming the due authorization, execution and
delivery hereof by the other parties to this Agreement, constitutes the legal,
valid and binding obligation of EMS, enforceable against EMS in accordance with
its terms.
c. No Violations. Neither this Agreement nor EMS's performance of
its obligations hereunder will contravene, violate or result in a breach of (i)
the Articles of Incorporation, Bylaws or other organizational documents of EMS,
(ii) any agreement, obligation or commitment to which EMS is a party or by which
it is bound, or (iii) any applicable requirement, judgment, order or restriction
of any court or other governmental entity, and no consent of, notice to or
filing with any person is required for the performance by EMS of the
transactions contemplated by or its obligations under this Agreement, other than
filings under the 1933 Act, 1934 Act or as required by the rules and regulations
of the National Association of Securities Dealers, Inc.
d. Purchase for Investment; Accredited Investor Status. EMS is
acquiring the Alanco Stock, the Alanco Notes, and any share of Alanco Common
Stock issued upon conversion of the Alanco Note in the form of Annex B, for
investment for its own account and not with a view to, or in connection with, a
distribution thereof within the meaning of Section 2(11) of the 1933 Act, other
than in transactions registered under or exempt from registration under such
Act. EMS acknowledges that such shares of Alanco Common Stock have not been
registered under the 1933 Act, or the securities laws of any state. EMS confirms
that Alanco has given EMS and its representatives the opportunity to ask
questions of the directors, officers and management employees of Alanco, and to
acquire such additional information about the business and financial condition
of Alanco as EMS has requested, and that all such information has been received
by EMS. EMS further confirms that it constitutes and "accredited investor" as
such term is defined for the purposes of Regulation D under the 1933 Act.
In Witness Whereof, the parties have caused this Assignment Agreement
to be executed and delivered on their respective behalves by their duly
authorized officers, on the date set forth above.
EMS TECHNOLOGIES, INC. ALANCO TECHNOLOGIES, INC.
By: ________________________ By: ____________________________
Name: Don T. Scartz Name:
Title: Senior Vice President and Title:
Chief Financial Officer
TECHNOLOGY SYSTEMS INTERNATIONAL, INC.
By: ________________________________
Name: Greg M. Oester
Title: Chief Executive Officer
Exhibit A
Promissory Note
Principal Scottsdale, Arizona
$250,000
FOR VALUE RECEIVED, the undersigned, Alanco Technologies, Inc. an
Arizona corporation (hereafter referred to as "Borrower"), promises to pay to
the order of EMS Technologies, Inc., a Georgia corporation (hereinafter,
together with any holder hereof, referred to as "Lender"), the principal sum of
Two Hundred Fifty Thousand Dollars ($250,000), said sum being payable on the
earlier of (i) the third anniversary of the date hereof; and (ii) to the extent
of funds received by Borrower from the State of California with respect to
installation of Borrower's system in the Calipatria prison, net of any expenses
incurred after the date of this note in completing said installation or
collecting said funds.
Interest shall accrue and be payable on the principal amount of this
Promissory Note outstanding from time to time at the rate of 5% per annum.
Accrued interest hereunder shall be payable on March 31, 2003, at the last day
of each calendar quarter thereafter, and at maturity.
Amounts due hereunder are payable to Lender at the Lender's offices at
660 Engineering Drive, Norcross, Georgia 30092, or at such other place as the
Lender may designate in writing.
The entire unpaid principal balance of this Promissory Note, or partial
payments in even thousands of dollars, may be paid at any time prior to maturity
without penalty.
If for any reason the principal balance together with all accrued
interest is not paid promptly on or before the due date, the Borrower shall be
in default hereunder. The Borrower shall also be in default hereunder if the
Borrower (i) files a voluntary petition in bankruptcy, (ii) is adjudicated as
bankrupt or insolvent, (iii) files a petition or answer seeking or acquiescing
in any reorganization or arrangement under the bankruptcy laws, (iv) seeks or
acquiesces in the appointment of a trustee or receiver, (v) makes a general
assignment for the benefit of creditors, (vi) admits in writing of its inability
to pay debts generally as they become due, or (vii) is the subject of an
involuntary petition in bankruptcy that is not withdrawn or dismissed within
sixty (60) days from the filing thereof.
Upon default and at any time thereafter, the Lender may declare the
entire unpaid balance of this Promissory Note immediately due and payable
without presentment, demand, protest, notice of default, notice of intent to
accelerate, notice of acceleration, or any other notice of any kind, all of
which are hereby expressly waived. Upon default, said principal sum, or so much
thereof as may remain unpaid at the time of such default, shall thereafter bear
interest at the lesser of the maximum rate allowed by applicable law or the rate
of 12% per annum.
If this Promissory Note is placed in the hands of an attorney for
collection, the borrower shall pay all costs of collection incurred by the
Lender, including reasonable attorneys' fees.
This Promissory Note is to be construed in all respects and enforced
according to the laws of the State of Arizona.
Notwithstanding any provision contained in this Note or any other
document executed or delivered in connection with this Note, the Lender shall
never be deemed to have contracted for or be entitled to receive, collect or
apply as interest on this Note, any amount in excess of the maximum rate of
interest permitted to be charged by applicable law, and, if the Lender ever
receives, collects or applies as interest any such excess, then the amount that
would be excessive interest shall be applied to reduce the unpaid principal
balance of this Note, and, if the principal balance of this Note is paid in full
by that application, then any remaining excess shall promptly be paid to
Borrower. In determining whether the interest paid or payable under any specific
contingency exceeds the highest lawful rate, Borrower and the Lender shall, to
the maximum extent permitted under applicable law, (i) characterize any
non-principal payment (other than payments expressly designated as interest
payments hereunder) as an expense or fee rather than as interest, (ii) exclude
voluntary prepayments and the effect thereof, and (iii) spread the total amount
of interest throughout the entire contemplated term of this Note so that
interest rate is uniform throughout that term.
Executed this ____ day of _________, 2002.
Signed, sealed and delivered BORROWER
in the presence of:
ALANCO TECHNOLOGIES, INC.
______________________________ By:__________________________________
Chief Executive Officer
Exhibit B
Promissory Note
Principal Scottsdale, Arizona
$100,000
FOR VALUE RECEIVED, the undersigned, Alanco Technologies, Inc. an
Arizona corporation (hereafter referred to as "Borrower"), promises to pay to
the order of EMS Technologies, Inc., a Georgia corporation (hereinafter,
together with any holder hereof, referred to as "Lender"), the principal sum of
One Hundred Thousand Dollars ($100,000), said sum being payable on the fifth
anniversary of the date hereof.
Interest shall accrue and be payable on the principal amount of this
Promissory Note outstanding from time to time at the rate of 5% per annum.
Accrued interest hereunder shall be payable on March 31, 2003, on the last day
of each calendar quarter thereafter, and at maturity.
Amounts due hereunder are payable to Lender at the Lender's offices at
660 Engineering Drive, Norcross, Georgia 30092, or at such other place as the
Lender may designate in writing.
The entire unpaid principal balance of this Promissory Note, or partial
payments in even thousands of dollars, may be paid at any time prior to maturity
without penalty.
Lender may at its option, exercised at any time and from time to time
prior to payment in full of all amounts owed under this Promissory Note, and
Borrower may at its option, exercised on any date on which the shares of the
common stock, no par value, of the Borrower (the "Common Shares") shall have
traded on the five preceding trading days at a closing price equal to or
exceeding $1.10 per share, as reported on NASDAQ, convert all or any portion of
the outstanding principal balance of, and unpaid accrued interest under, this
Promissory Note into the Common Shares, at a conversion rate of $1.00 per Share,
subject as to both conversion rate and the closing price triggering Borrower's
option to (i) proportionate adjustment to prevent any dilution of Lender's
potential interest in the equity of Borrower caused by any share split or share
dividend, and (ii) reduction equal to the per-Share value of any other
distribution (whether as a dividend or otherwise, and whether in cash or in
kind) to shareholders of record on a date prior to the date of conversion and
issuance of Shares pursuant thereto. In the event of any merger, reorganization
or other transaction resulting in the holders of the Common Shares receiving or
holding any security or other property different from or in addition to the
Common Shares, this conversion right shall entitle the Lender to receive, at the
adjusted conversion price then in effect, such security or a Common Share and
such other property received or held as a result of such transaction with
respect to each Common Share.
If for any reason the principal balance together with all accrued
interest is not paid promptly on or before the due date, the Borrower shall be
in default hereunder. The Borrower shall also be in default hereunder if the
Borrower (i) files a voluntary petition in bankruptcy, (ii) is adjudicated as
bankrupt or insolvent, (iii) files a petition or answer seeking or acquiescing
in any reorganization or arrangement under the bankruptcy laws, (iv) seeks or
acquiesces in the appointment of a trustee or receiver, (v) makes a general
assignment for the benefit of creditors, (vi) admits in writing of its inability
to pay debts generally as they become due, or (vii) is the subject of an
involuntary petition in bankruptcy that is not withdrawn or dismissed within
sixty (60) days from the filing thereof.
Upon default and at any time thereafter, the Lender may declare the
entire unpaid balance of this Promissory Note immediately due and payable
without presentment, demand, protest, notice of default, notice of intent to
accelerate, notice of acceleration, or any other notice of any kind, all of
which are hereby expressly waived. Upon default, said principal sum, or so much
thereof as may remain unpaid at the time of such default, shall thereafter bear
interest at the lesser of the maximum rate allowed by applicable law or the rate
of 12% per annum.
If this Promissory Note is placed in the hands of an attorney for
collection, the borrower shall pay all costs of collection incurred by the
Lender, including reasonable attorneys' fees.
This Promissory Note is to be construed in all respects and enforced
according to the laws of the State of Arizona.
Notwithstanding any provision contained in this Note or any other
document executed or delivered in connection with this Note, the Lender shall
never be deemed to have contracted for or be entitled to receive, collect or
apply as interest on this Note, any amount in excess of the maximum rate of
interest permitted to be charged by applicable law, and, if the Lender ever
receives, collects or applies as interest any such excess, then the amount that
would be excessive interest shall be applied to reduce the unpaid principal
balance of this Note, and, if the principal balance of this Note is paid in full
by that application, then any remaining excess shall promptly be paid to
Borrower. In determining whether the interest paid or payable under any specific
contingency exceeds the highest lawful rate, Borrower and the Lender shall, to
the maximum extent permitted under applicable law, (i) characterize any
non-principal payment (other than payments expressly designated as interest
payments hereunder) as an expense or fee rather than as interest, (ii) exclude
voluntary prepayments and the effect thereof, and (iii) spread the total amount
of interest throughout the entire contemplated term of this Note so that
interest rate is uniform throughout that term.
Executed this ____ day of________, 2002.
Signed, sealed and delivered BORROWER
in the presence of:
ALANCO TECHNOLOGIES, INC.
______________________________ By: ______________________________________
Chief Executive Officer
EXHIBIT 10.2
ASSET PURCHASE AGREEMENT AND
SECOND AMENDMENT TO
SUPPLY AND LICENSE AGREEMENT
THIS ASSET PURCHASE AGREEMENT AND SECOND AMENDMENT TO
SUPPLY AND LICENSE AGREEMENT ("Second Amendment") is made this 16th day of
January, 2004, between EMS TECHNOLOGIES, INC., a Georgia corporation ("EMS"),
and TECHNOLOGY SYSTEMS INTERNATIONAL, INC., an Arizona corporation ("TSI").
RECITALS:
EMS and Technology Systems International, Inc., a Nevada corporation
("Old TSI"), were parties to that certain Exclusive Supply Agreement, dated
December 23, 1998 (the "Original Supply Agreement"), providing for the supply by
EMS to Old TSI of certain products for use in personnel locator systems offered
by Old TSI for installation in prison systems.
TSI acquired substantially all of the assets and business of Old TSI
effective May 14, 2002, and Old TSI, EMS and TSI agreed to amend the Original
Supply Agreement pursuant to that certain Supply and License Agreement, dated
May 14, 2002, among said parties (the "First Amendment"). The Original Supply
Agreement, as amended by the First Amendment is referred to herein as the
"Supply Agreement".
TSI has purchased certain products from EMS for incorporation into the
prison monitoring system sold to the state of Illinois for installation at a
prison facility known as the Logan Facility, and TSI currently owes EMS a
disputed amount for said products of EMS.
The parties hereto wish to transfer to TSI assets currently held by EMS
and used in the production of the prison monitoring systems marketed by TSI, and
to resolve their disagreements and further amend the Supply Agreement as set
forth herein.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the parties agree as follows:
1. Payment of Logan Facility Product Invoices. TSI shall pay $200,000
to EMS in full satisfaction of amounts due to EMS for all products previously
delivered by EMS for the Logan Facility, in the manner set forth in section 6
below.
2. MCAE Tooling. In satisfaction of TSI's obligations under section
2.c. of the First Amendment, TSI shall pay EMS the fixed amount of $50,000 for
the molds and related tooling located at the facilities of MCAE (or located at
the facilities of MCAE's subcontractor) used in connection with the housings and
related components for PASS and PAL units for TSI's monitoring systems
("Tooling"). Said amount shall be paid by TSI in the manner set forth in section
6 below. In addition to the fixed amount specified in the previous sentence, TSI
shall also pay to EMS for the Tooling the sum of $2.00 for each set of PASS or
PAL housing components produced from the Tooling after the first 2,000 of such
housing sets produced
following the date hereof, but not more than $10,000 aggregately. Said
per-housing set amount shall be paid by TSI to EMS with respect to particular
housing sets within 30 days after TSI takes delivery of such housing sets. EMS
warrants that upon receipt of such payment, TSI will have full title to the
Tooling, with the right to possess the Tooling free and clear of any claims or
liens by MCAE or others.
3. Warranty Credit. Without admitting any liability whatsoever, EMS
hereby grants TSI a credit against amounts due from TSI hereunder in the amount
of $50,000 in full satisfaction of any and all warranty or similar product
claims with respect to all products previously delivered by EMS under the Supply
Agreement. Said amount shall be credited in the manner set forth in section 6
below.
4. Purchase Obligation Fulfillment; C-Nodes. In satisfaction of the
parties' remaining obligations under section 1.a of the First Amendment
concerning the dollar amount of products to be purchased by TSI from EMS, TSI
shall pay to EMS the aggregate sum of $137,000 in the manner described in this
section. The parties anticipate that TSI will, as soon as practicable, take over
the responsibility to manufacture c-nodes for its requirements. Until such time,
EMS will continue to manufacture and sell c-nodes to TSI. For each c-node
manufactured by EMS and delivered as directed by TSI after the date hereof (at
the existing contract price of $15,790 per c-node), the amount of $4,000 shall
be credited against said $137,000 obligation. Thereafter, for each c-node
manufactured by TSI and installed in a prison monitoring system, TSI will pay to
EMS the sum of $1,250 as a royalty until the balance of the $137,000 obligation
is fully paid. The royalty amount shall be paid to EMS within fifteen days
following receipt of payment for the c-node from TSI's customer. With respect to
c-nodes purchased from EMS that are not purchased for installation at a
particular site (i.e., inventory c-nodes), TSI shall pay for the same on a
net-30 day basis.
5. Purchase of Inventory.
a. TSI shall purchase certain of EMS' inventory of
non-defective prison monitoring system parts, including the remaining c-node
inventory once TSI assumes manufacturing responsibility for c-nodes. The
inventory to be initially purchased, as well as the purchase price for the same,
is set forth on Exhibit "A" attached hereto (excluding c-node inventory), with
an aggregate purchase price of $289,893 (the sum of the individual parts prices
reflected on said Exhibit A plus $12,000,00), to be paid in the manner set forth
in section 6 below. The deferred balance for the inventory will be paid as the
inventory is consumed on a pro-rata basis, that is, the deferred balance to be
paid for each inventory part shall be determined by multiplying the price for
said part shown on Exhibit "A" by the fraction 125,910/289,893 ( or 0.434). TSI
shall produce a quarterly report of what inventory remains, and shall pay for
any inventory used in the quarter in three equal quarterly installments
commencing 15 days after the end of the quarter. The initial payment trigger is
removing parts from the shelf, not when TSI's customer pays for the system. Any
balance owed with respect to the inventory would be due in full two years
following the date hereof, regardless of whether the inventory has at that time
been consumed by TSI. The inventory must be of good quality. Any inventory found
to be defective as it is used will be returned to EMS and the balance of the
obligation for the inventory reduced by TSI's purchase price for such returned
inventory. In addition, if the defective
inventory makes other inventory purchased from EMS obsolete because of the
unavailability of parts to produce components, then such other obsolete
inventory may also be returned to EMS for credit.
b. When TSI assumes production responsibility for c-nodes, the
remaining EMS c-node inventory shall also be purchased by TSI upon the same
conditions set forth in paragraph 5.a above; provided, however, the aggregate
purchase price for such inventory shall not be greater than $50,000. The full
purchase price for the c-node inventory shall be added to the deferred balance
for the initial inventory purchased, to be paid for when used in the manner
described above for the initial inventory purchased. EMS's current c-node
inventory, with the unit pricing to be paid by TSI hereunder, is attached hereto
as Exhibit "B". Said inventory list may be reduced as components are used by EMS
in producing c-nodes for sale to TSI as described in section 4 above, and may be
increased for any extra parts acquired by EMS due to quantity purchasing
obligations as EMS produces c-nodes for TSI.
6. The following table summarizes the payment obligations of TSI to EMS
set forth above:
Item Fixed Amount Contingent Amount
---------------------- ---------------- -----------------------------------------------
Illinois Invoices $200,000
---------------------- ---------------- -----------------------------------------------
MCAE Tooling $50,000 Plus additional $10,000 payable $2.00 per
housing set after first 2,000 sets
---------------------- ---------------- -----------------------------------------------
Warranty Credit ($50,000)
---------------------- ---------------- -----------------------------------------------
C-Nodes $137,000 to be "paid" by crediting $4,000 per
c-node manufactured by EMS, and $1,250
royalty for each c-node manufactured by TSI
---------------------- ---------------- -----------------------------------------------
Inventory $289,893 Plus additional amount for remaining c-node
inventory when TSI assumes c-node
manufacturing obligation
---------------------- ---------------- -----------------------------------------------
TOTAL FIXED $489,893
AMOUNT PAYABLE
---------------------- ---------------- -----------------------------------------------
The total fixed initial amount payable of $489,893 shall be paid as follows:
$75,000 cash upon the execution hereof
$125,946 cash on a deferred basis as the inventory is employed in
accordance with section 5 above
$288,947 balance in the form of 288,947 shares Class A common stock of
Alanco Technologies, Inc. to be issued upon the execution
hereof.
7. Conversion of Existing Promissory Note. Upon the date hereof, the existing
promissory note of Alanco Technologies, Inc in favor of EMS, dated May 14, 2002,
in the principal amount of $250,000 shall be satisfied in full by Alanco
Technologies issuing 250,000 shares of its Class A common Stock to EMS, plus
unpaid interest accrued to the date of conversion.
8. EMS Representations; Registration of Stock. EMS restates for the purposes of
this Amendment the representations set forth in Section 9 of the First
Amendment. Alanco Technologies, Inc shall file an S-3 registration statement
with the SEC for the resale in over-the- counter or privately negotiated
transactions of the shares of its Class A common stock issued to EMS under
sections 6 and 7 above within 45 days following the date hereof, without cost to
EMS, and shall use its best reasonable efforts to cause said registration to
become effective as soon as possible thereafter.
9. Access to Information. As long as EMS is owed monies by TSI hereunder, EMS
shall have the right to such information and reports concerning the operations
of TSI as set forth in the Original Supply Agreement.
10. Supply Agreement. Except as expressly modified by this Second Amendment, the
Supply Agreement shall remain in full force and effect in accordance with its
terms.
IN WITNESS WHEREOF, the parties have executed this Second Amendment
effective the date first above written.
EMS TECHNOLOGIES, INC.
a Georgia corporation
By: ______________________________________
Its: ______________________________________
TECHNOLOGY SYSTEMS INTERNATIONAL, INC.
an Arizona corporation
By: ______________________________________
Greg E. Oester
President
For the purpose of agreeing to sections 7 and 8 only:
ALANCO TECHNOLOGIES, INC.
an Arizona corporation
By: _____________________________________
John A. Carlson, Chief Financial Officer
-----------------------------------------------------------------------------------------------------------------
Summary EMS Non C-Node Inventory
-----------------------------------------------------------------------------------------------------------------
PASS, PAL, Aetec Return Stock Inventory - (Subtotal from Page 5) $204,517.06
Aetec Furnished Pass Material Inventory - (Subtotal from Page 7) $73,375.72
Grand Total $277,892.78
-----------------------------------------------------------------------------------------------------------------
PASS, PAL, Aetec Return Stock Inventory
Part Number Description Qty Cost Extension
524001-226 IC,MONITOR,VOLT,MAX811 800 $1.00 $800.00
524000-34 IC,INV,SGL,7SHU04FU 6244 $0.30 $1,873.20
526000-106 DIO,RECT,600V,1SR154-600 5000 $0.10 $500.00
525003-8 CAP,CHIP,TRIM.,25V,5-40 PF 2401 $0.40 $960.40
524001-601 IC,XMTR,UHF,13176 3840 $1.62 $6,220.80
525000BP3R3ACTA CAP,C0603,50V,NPO,+ -.25PF,3.30P 20 $0.01 $0.20
535003B6R8JT1 IDCTR,CHIP,0603,6.8NH,5% 3614 $0.25 $903.50
535003C151KT1 IDCTR,CHIP,0805,150NH,10% 6801 $0.25 $1,700.25
577001-28 CONN,SMA,PCB SMT,JACK RCPT 253 $0.96 $242.88
546001-201 IC,SW,R.F.,GAAS,2.5GHZ,SW338 227 $2.50 $567.50
525000AP560AJTA CAP,C0402,50V,NPO,5%,56.0PF 40893 $0.01 $408.93
525000AP820AJTA CAP,C0402,50V,NPO,5%,82.0PF 2867 $0.01 $28.67
529000AL104JTA RES,R0402,.063W,5%,100K 30114 $0.01 $301.14
529000AL225JTA RES,R0402,.063W,5%,2.20M 12178 $0.01 $121.78
529000AL113JTA RES,R0402,.063W,5%,11.0K 10401 $0.01 $104.01
529000AL273JTA RES,R0402,.063W,5%,27.0K 9493 $0.01 $94.93
529000AL242JTA RES,R0402,.063W,5%,2.40K 726 $0.02 $14.52
529000AL133JTA RES,R0402,.063W,5%,13.0K 11710 $0.02 $234.20
525000AP271AKTA CAP,C0402,50V,NPO,10%,270PF 10000 $0.02 $200.00
525000AX821AKTA CAP,C0402,50V,X7R,10%,820PF 10,004 $0.02 $200.08
525000AP4R7ACT2 CAP,C0402,50V,NPO,+ -.25PF,4.70P 9957 $0.03 $298.71
525000AX102AKTA CAP,C0402,50V,X7R,10%,1000PF 8860 $0.03 $265.80
525000BY104DLTA CAP,C0603,16V,Y5V,+80%,.10UF 9630 $0.07 $674.10
525000AP101AJTA CAP,C0402,50V,NPO,5%,100PF 19152 $0.07 $1,340.64
525000AP120AJTA CAP,C0402,50V,NPO,5%,12.0PF 12192 $0.07 $853.44
525000AX103DKTA CAP,C0402,16V,X7R,10%,.010UF 37475 $0.08 $2,998.00
525000AY333DLTA CAP,C0402,16V,Y5V,+80%,.033UF 17550 $0.09 $1,579.50
527002-11 XSTR,N-CH,3.5,.8A,BSS138 24229 $0.16 $3,876.64
535004-0906-5 IDCTR,AIR CORE,5.45 nH,5% 3884 $0.29 $1,126.36
524000-209 IC,EEPROM,SER,64X16,93LC46 6557 $0.31 $2,032.67
525003-3 CAP,CHIP,TRIM.,25V,1-3 PF 5826 $0.40 $2,330.40
527002-7 XSTR,P-CH,MIC94031BM4 8932 $0.49 $4,376.68
524001-500 IC,DRVR,CRYSTAL OSC,7210 3489 $0.59 $2,058.51
546001-9 AMPL,R.F.,SIL.,MIC,SO-8 2114 $1.73 $3,657.22
524002-2 ASIC,PRISM 10677 $4.46 $47,619.42
525000CX104AKTA CAP,C0805,50V,X7R,10%,.10UF 8813 $0.01 $88.13
535000-3 IDCTR,RADIAL LEAD,100uH,10% 799 $0.30 $239.70
524001-200 IC,OP AMP,JFET,QUAD, LF347 102 $0.43 $43.86
524001-201 IC,OP AMP,JFET,QUAD, LF347 75 $0.60 $45.00
525000CP101AJTA CAP,C0805,50V,NPO,5%,100PF 108 $0.01 $1.08
529000BL332JTA RES,R0603,.100W,5%,3.30K 220 $0.01 $2.20
529000BL471JTA RES,R0603,.100W,5%,470 188 $0.01 $1.88
529000BL104JTA RES,R0603,.100W,5%,100K 155 $0.01 $1.55
529000BL1001FTA RES,R0603,.100W,1%,1.00K 4998 $0.01 $49.98
564001-110 WSHR, LK, EXT TOOTH 2.5MM 71 $0.08 $5.68
579001-7 WSHR,LK,INT TOOTH,BNC CONN 333 $0.08 $26.64
579001-6 NUT,JAM,BNC CONN 415 $0.10 $41.50
525001D106K35TA CAP,TANT,C7343,35V,10%,10UF 313 $0.25 $78.25
526000-508 DIO,LED,RED,5V,3.5MA,INT. RES. 791 $0.54 $427.14
PASS PAL, Aetec Return Stock Inventory
Part Number Description Qty Cost Extension
577000-1 CONN,BNC,RT ANGLE,50 OHM,WHT 402 $0.59 $237.18
524001-2 IC,OP AMP,JFET,QUAD, LF347 137 $0.85 $116.45
524000-9 IC,BFR,OCTAL,74FCT244 10 $0.88 $8.80
564001-100 HDW,MNTG,FOR 564001-1 &-2 223 $0.91 $202.93
577000-2 CONN,ROW,RT ANGLE,96PIN,3 ROW 17 $1.39 $23.63
564001-103 NUT,CPTV,19"RK,M-6 300 $1.48 $444.00
524001-101 IC,OP AMP,QUAD,100MHHZ,LT1230 9 $1.84 $16.56
564001-1 HDL,EJCTR,BOT,BLK 15 $2.23 $33.45
564001-2 HDL,EJCTR,TOP,BLK 15 $2.23 $33.45
524001-100 IC,COMPTR,ULTRAFAST,AD9698 157 $3.30 $518.10
524000-301 IC,FPGA,22V10 27 $3.50 $94.50
564001-107 TAPPED STRIPS 4 $5.41 $21.64
564001-204 PNL,BLK,PCB,NO HDL,6U 4HP 2 $5.69 $11.38
524000-100 IC,GATE,OCTAL ,74F641 45 $6.06 $272.70
524001-1 IC,OP AMP,QUAD,100MHHZ,LT1230 60 $9.13 $547.80
564001-102 BLT,SLTD,FOR 19"RACK 264 $11.48 $3,030.72
524000-302 IC,FPGA,ISPLSI1024 3 $12.50 $37.50
524000-300 IC,FPGA,2000 GATES,3042 45 $13.78 $620.10
554000-40W HEADER,DIP,LOW PROFILE,40 SCKT 43 $0.15 $6.45
554000-32W HEADER,DIP,LOW PROFILE,32 SCKT 2 $0.36 $0.72
524000-8 IC,XCVR,BI-DIR,OCTAL,74ABT245 15 $0.79 $11.85
553000-1 TERM STRIP,1ROW,36PIN,ST,.110 50 $0.94 $47.00
524000-200 IC,FIFO,512X9,50MHZ,7201 52 $2.23 $115.96
539003-1 OSC,XTAL, CLK,80 MHZ,14PDIP 27 $5.35 $144.45
524000-10 IC,GATE,OCTAL ,74F641 2 $5.50 $11.00
524000-108 IC,GATE,OCTAL ,74F641 5 $6.55 $32.75
524000-101 IC,MIC CTLR,8-BIT,16C74-20 5 $7.82 $39.10
602115-2 PWB DETAIL-MAST TIMING GENERAT 30 $51.97 $1,559.10
529000BL000JTA RES,R0603,1AMP,0.0 5000 $0.003 $15.00
535000-15 IDCTR,CHIP,32CS,1uH,10% 3308 $1.00 $3,308.00
529000BL106JTA RES,R0603,.100W,5%,10M 114 $0.003 $0.34
529000BL331JTA RES,R0603,.100W,5%,330 294 $0.003 $0.88
529000BL333JTA RES,R0603,.100W,5%,33.0K 4992 $0.003 $14.98
529000BL2490FTA RES,R0603,.100W,1%,249 246 $0.004 $0.98
529000BL112JTA RES,R0603,.100W,5%,1.10K 212 $0.01 $2.12
529000BL220JTA RES,R0603,.100W,5%,22.0 5000 $0.01 $50.00
529000BL4990FTA RES,R0603,.100W,1%,499 112 $0.02 $2.24
525000CP221AJTA CAP,C0805,50V,NPO,5%,220PF 3394 $0.02 $67.88
526000-104 DIO,SHTKY,200nA@25V,MMBD301 4647 $0.03 $139.41
525000EP121AJTB CAP,C1206,50V,NPO,5%,120PF 200 $0.05 $10.00
554000-28S HEADER,DIP,LOW PROFILE,28 SCKT 42 $0.12 $5.04
526000-1 DIO,SHTKY,200nA@25V,MMBD301 461 $0.15 $69.15
525000CP681AJTA CAP,C0805,50V,NPO,5%,680PF 3992 $0.17 $678.64
524000-3 IC,GATE,AND,QUAD,74ACT08 35 $0.19 $6.65
524000-4 IC,GATE,OR,QUAD,74ACT32 46 $0.19 $8.74
524000-5 IC,FLIP FLOP,D,DUAL,74AC74 191 $0.21 $40.11
535000-1 IDCTR,CHIP,32CS,1uH,10% 178 $0.35 $62.30
524000-6 IC,FLIP FLOP,D,OCTAL,74ABT374 96 $0.59 $56.64
551000-1 FUSE,.75A,SURFSCE MT 2000 $0.72 $1,440.00
527000-102 XSTR,PNP,QD,EP2015 79 $1.65 $130.35
PASS PAL, Aetec Return Stock Inventory
Part Number Description Qty Cost Extension
524001-400 IC,SWITCH,SPST,QUAD,MAX352 378 $1.76 $665.28
524001-300 IC,CONV,D/A,6-BIT,8444 28 $1.78 $49.84
535000-2 IDCTR,AXIAL LEAD,100uH,10% 319 $1.93 $615.67
602232-1 PNL,FRNT,MOD.,TOA BD. 30 $5.83 $174.90
602113-3 PWB DETAIL - TOA BOARD 50 $37.80 $1,890.00
524000-314 IC,GATE,AND,QUAD,74ACT08 9 $45.10 $405.90
535003A330JTA IDCTR,CHIP,0402,33NH,5% 15243 $0.10 $1,524.30
525000BP1R8ACTA CAP,C0603,50V,NPO,+ -.25PF,1.80P 154 $0.01 $1.54
525000BP2R2ACTA CAP,C0603,50V,NPO,+ -.25PF,2.20P 500 $0.01 $5.00
525000BP360AJTA CAP,C0603,50V,NPO,5%,36.0PF 3784 $0.01 $37.84
525000BX103AKTA CAP,C0603,50V,X7R,10%,.010UF 3000 $0.01 $30.00
529000BL561JTA RES,R0603,.100W,5%,560 4999 $0.01 $49.99
525000BP101AJTA CAP,C0603,50V,NPO,5%,100PF 100 $0.02 $2.00
571003PC21SFP SCR,SELF TAP,B4-24X.380 18-8SS 2357 $0.04 $94.28
567001-403 SPCR,CMPNT,SLBL,.070X.030X.025 45 $0.04 $1.80
525000BP100AJTA CAP,C0603,50V,NPO,5%,10.0PF 13 $0.06 $0.78
529002-1 RES,VAR,50,20%,4MM SMT 528 $0.20 $105.60
525003-6 CAP,CHIP,TRIM.,100V,4.5-20 PF 941 $0.40 $376.40
525003-7 CAP,CHIP,TRIM.,100V,6.5-30 PF 38 $0.40 $15.20
526000-2 DIO,SHTKY,200nA,50V,HSMS-2804 92 $0.50 $46.00
546001-2 AMPL,RF,86,MMIC,BIPLR,0-.8GHz 1300 $1.00 $1,300.00
525000EY105ELTA CAP,C1206,25V,Y5V,+80PF,1UF 211 $1.00 $211.00
546001-3 LNA/MIXER,,MMIC,8-12GHz 319 $1.00 $319.00
602126-1 SHIELD-A,AP RF 998 $1.50 $1,497.00
602127-1 SHIELD-B,AP RF 665 $1.50 $997.50
524001-600 IC,RCVR,WIDE BAND,13155 144 $2.17 $312.48
577005-1 CONN,BNC,JACK,P.C. BD MT 304 $3.00 $912.00
577001-2 CONN,BNC,JACK,P.C. BD MT 418 $3.00 $1,254.00
546000-1 FLTR,BP,3POLE SMD 915MHz 444 $3.00 $1,332.00
539000-1 IC,CORRELATOR,SAW,140MHZ 150 $5.00 $750.00
539002-1 FILTR,SAW,140MHZ 275 $33.00 $9,075.00
562001-18 BSHG,STRN RLF 7 $1.13 $7.91
564001-406 KEYLOCK,PUSH BTN,INSR 35 $2.05 $71.75
564001-404 KEYLOCK,PUSH BTN,INSR 47 $7.00 $329.00
529000AL202JTA RES,R0402,.063W,5%,2.00K 4494 $0.02 $89.88
553001-6 CONT,PL 138 $0.06 $8.28
525000AP470AJTA CAP,C0402,50V,NPO,5%,47.0PF 6994 $0.08 $559.52
529000AL6493FTA RES,R0402,.063W,1%,649K 9394 $0.10 $939.40
M16878/1BFE90 WIRE,STRD,PVC,22 AWG,WHT/BLK 90 $0.17 $15.30
193002-1 PIN,PASS TAPERED STRAP 7876 $0.17 $1,338.92
577004-1 CONN,D,PNL RCPT SHL,INSULD 23 $0.19 $4.37
525001E477M06T4 CAP,TANT,7343H,6.3V,470UF,20% 967 $0.98 $947.66
539001-2 FILTR,SAW,914MHZ 5126 $1.67 $8,560.42
539008-1 XTAL,QTZ,28.59375 MHZ 432 $8.75 $3,780.00
MS16995-2 SCR,CAP,SKT HD,.086-56X.250 1180 $0.06 $70.80
NAS1352C02-4 SCR,CAP,SKT HD,.0860-56X.250 988 $0.07 $69.16
190957-1 PRISM PASS ANTENNA 694 $0.87 $603.78
193075-1 ANTENNA HOLDER,PRISM PASS 2K 721 $1.00 $721.00
193074-1 BATTERY HOLDER,PRISM PASS 2K 523 $1.00 $523.00
191511-1 SHIELD COVER, PRISM PASS 779 $1.90 $1,480.10
193214-1 SHIELD COVER,PRISM PASS 1650 $1.95 $3,217.50
193072-1 MAIN HOUSING,PRISM PASS 2K 76 $6.00 $456.00
193594-1 BACK COVER,REV-E WITH-SENSE 488 $7.00 $3,416.00
N/A AETEC #100-19077-35 PWB 1648 $4.02 $6,624.96
525000AP2R2ACTA CAP,C0402,50V,NPO,+\- 325PF,2.20P 3264 $0.02 $75.07
525000CAP150AJTA CAP,C0402,50V,NPO,5%.15.0PF 18157 $0.02 $334.09
525000CY334DLTA CAP,CHIP,C0805,16V,.33uF+80 3201 $0.06 $176.06
526000-207 DIO,SIG,SILICON,100V, LOW LEAK 4003 $0.14 $540.41
553001-24 CONT,PIN,FEMALE,0.030 21 $0.64 $13.44
535003A100JTA IDCTR,CHIP,0402,10NH,5% 3350 $0.30 $1,000.98
524001-111 IC,COMPTR,SNGL SPLY, MAX921 5004 $1.75 $8,757.00
546015-200 AMP,SILICON,MMIC,3V 1574 $0.97 $1,526.78
529002-11 RES,VAR,10K,25%,2MM 1715 $0.02 $35.50
529000AL3013FTA RES,R0402,.063W,1%,301K 9046 $0.01 $63.32
529000AL1004FTA RES,R0402,.063W,1%,1M 9110 $0.01 $63.77
529000AL8252FTB RES,R0402,.063W,1%,82.5K 16843 $0.00 $77.48
529000AL4753FTA RES,R0402,.063W,1%,475K 3076 $0.12 $353.74
529000AL1503FTA RES,R0402,.063W,1%,150K 3978 $0.02 $91.49
529000AL331JTA RES,R0402,.063W,5%,330 9078 $0.01 $45.39
529000AL9R1JTA RES,R0402,.063W,5%,9.1 6410 $0.02 $147.43
529000AL131JTA RES,R0402,.063W,5%,130 3362 $0.01 $38.66
529000AL103JTA RES,R0402,.063W,5%,10.0K 8846 $0.01 $44.23
529000AL5493FTA RES,R0402,.063W,1%,549K 9366 $0.44 $4,158.50
546015-101 R.F.,SW,L-BAND,SPDT,GaSa,MMIC 1643 $2.10 $3,444.06
539009-1 XTAL,QTZ,10.000000 MHZ 407 $5.00 $2,033.01
539010-1 XTAL,QTZ,32.768 KHZ 596 $3.19 $1,898.86
529000AL6192FTA RES,R0402,.063W,1%,61.9K 2256 $0.02 $52.11
191115-3 PWB PRISM PASS 4237 $2.05 $8,685.85
191510-1 SHIELD FRAME, PRISM PASS 4 $0.00 $0.00
529002-12 RES, VAR, 100K, 25%, 2MM 2244 $0.31 $700.13
552000-13 SW, SEALED, SELECTOR, 3MM SQ 3675 $1.72 $6,306.30
Subtotal PAL PASS Aetec Return Stock $204,517.06
Aetec Furnished PASS Material
Part Number Description Qty Cost Extension
None PCB BOARD 1648 $4.02 $6,632.39
524000-209 IC,EEPROM,SER,64X16,93LC46 1693 $0.48 $812.64
524002-2 ASIC,PRISM 7 $4.46 $31.22
527002-11 XSTR,N-CH,3.5,.8A,BSS138 12339 $0.16 $1,974.24
525000AX103DKTA CAP,C0402,16V,X7R,10%,.010UF 14726 $0.10 $1,413.70
525000AP560AJTA CAP,C0402,50V,NP0,5%,56.0PF 30000 $0.01 $276.00
525000AP560AJTA CAP,C0402,50V,NP0,5%,56.0PF 6504 $0.01 $59.84
525000AP560AJTA CAP,C0402,50V,NPO,5%,56.0PF $0.00
$0.00
$0.00
525000AY333DLTA CAP,C0402,16V,Y5V,+80%,.033UF 16442 $0.09 $1,479.78
525000AY333DLTA CAP,C0402,16V,Y5V,+80%,.033UF $0.00
525000AP101AJTA CAP,C0402,50V,NP0,5%,100PF 6300 $0.01 $81.90
525000AP101AJTA CAP,C0402,50V,NP0,5%,100PF $0.00
525000AP4R7ACT2 CAP,C0402,50V,NPO,t.25PF,4.70P 2808 $0.03 $96.88
525000AP2R2ACTA CAP,C0402,50V,NPO,+ -.25PF,2.20P 3264 $0.02 $75.07
525000AP271AKTA CAP,C0402,50V,NP0,10%,270PF $0.23 $0.00
52500CAP150AJTA CAP,C0402,50V,NPO,5%,15.0PF 8157 $0.00 $0.00
52500CAP150AJTA CAP,C0402,50V,NPO,5%,15.0PF 10000 $0.02 $184.00
525000AX821AKTA CAP,C0402,50V,X7R,10%,820PF 8314 $0.02 $191.22
525000AP820AJTA CAP,C0402,50V,NPO,5%,82.0PF 1136 $0.03 $39.31
525000AP820AJTA CAP,C0402,50V,NPO,5%,82.0PF 508 $0.13 $64.67
525000AX102AKTA CAP,C0402,50V,X7R,10%,1000PF 6996 $0.08 $531.70
525000AP120AJTA CAP,C0402,50V,NP0,5%,12.0PF 8424 $0.08 $640.22
525000AP470AJTA CAP,C0402,50V,NPO,5%,47.0PF 6036 $0.01 $62.77
525000BY104DLTA CAP,C0603,16V,Y5V,+80%,.10UF 3862 $0.02 $84.96
525000CY334DLTA CAP,CHIP,C0805,16V,.33uF+80 3201 $0.06 $176.06
525000CY334ELTA CAP, CHIP,C0805,25V,.33uF,+80 $0.00
ALTERNATE PART FOR ITEM #0018 $0.00
525001E477M06T4 CAP,TANT,7343H,6.3V,470UF,20% 877 $0.98 $859.46
525003-3 CAP,CHIP,TRIM.,25V,1-3 PF 5738 $0.47 $2,672.76
525003-8 CAP,CHIP,TRIM.,25V,5-40 PF 2301 $0.48 $1,095.28
526000-207 DIO,SIG,SILICON,100V,LOW LEAK 3000 $0.14 $405.00
526000-207 DIO,SIG,SILICON,100V,LOW LEAK 1003 $0.12 $115.35
553001-24 CONT,PIN,FEMALE,0.030 21 $0.64 $13.44
524001-500 IC,DRVR,CRYSTAL OSC,7210 1664 $1.02 $1,693.62
524000-34 IC,INV,SGL,7SHU04FU 6214 $0.18 $1,118.52
524000-34 IC,INV,SGL,7SHU04FU $0.00
535003A330JTA IDCTR,CHIP,0402,33NH,5% 15222 $0.12 $1,758.14
535003A330JTA IDCTR,CHIP,0402,33NH,5% $0.00
535003A100JTA IDCTR,CHIP,0402,10NH,5% 3350 $0.30 $1,000.98
535004-0906-5 IDCTR,AIR CORE,5.45 nH,5% 1744 $0.41 $715.04
524001-226 IC,MONITOR,VOLT,MAX811 687 $1.37 $944.49
524001-111 IC,COMPTR,SNGL SPLY,MAX921 5004 $1.75 $8,757.00
524001-601 IC,XMTR,UHF,13176 1678 $1.49 $2,500.89
527002-7 XSTR,P-CH,MIC94031BM4 6772 $0.57 $3,860.04
546015-200 AMP,SILICON,MMIC,3V 842 $0.52 $433.80
546015-200 AMP,SILICON,MMIC,3V 732 $0.97 $710.04
546001-9 AMPL,R.F.,SIL.,MIC,SO-8 1369 $2.50 $3,428.52
193002-1 PIN,PASS TAPERED STRAP 4861 $0.35 $1,677.53
529002-11 RES,VAR,10K,25%,2MM 1715 $0.02 $35.50
529000AL225JTA RES,R0402,.063W,5%,2.20M 8352 $0.01 $96.05
529000AL104JTA RES,R0402,.063W,5%,100K 16510 $0.01 $82.55
529000AL3013FTA RES,R0402,.063W,1%,301K 9046 $0.01 $63.32
529000AL1004FTA RES,R0402,.063W,1%,1M 9110 $0.01 $63.77
529000AL6493FTA RES,R0402,.063W,1%,649K 7914 $0.03 $258.00
52900OAK8252FTB RES,R0402,.063W,1%,82.5K 16843 $0.00 $77.48
529000AL4753FTA RES,R0402,.063W,1%,475K 3076 $0.12 $353.74
529000AL273JTA RES,R0402,.063W,5%,27.0K 8923 $0.01 $44.62
529000AL202JTA RES,0402,.063W,5%.2.00K 3576 $0.02 $82.25
529000AL1503FTA RES,R0402,.063W,1%,150K 3978 $0.02 $91.49
529000AL331JTA RES,R0402,.063W,5%,330 9078 $0.01 $45.39
529000AL9R1JTA RES,R0402,.063W,5%,9.1 6410 $0.02 $147.43
529000AL131JTA RES,R0402,.063W,5%,130 3362 $0.01 $38.66
529000AL113JTA RES,R0402,.063W,5%,11.0K 9270 $0.01 $46.35
529000AL133JTA RES,R0402,.063W,5%,13.0K 8854 $0.01 $44.27
529000AL242JTA RES,R0402,.063W,5%,2.40K 1856 $0.02 $42.69
529000AL103JTA RES,R0402,.063W,5%,10.0K 8846 $0.01 $44.23
529000AL5493FTA RES,R0402,.063W,1%,549K 1780 $0.40 $719.12
529000AL5493FTA RES,R0402,.063W,1%,549K 7586 $0.04 $303.44
546015-101 R.F.,SW,L-BAND,SPDT,GaSa,MMIC 1643 $2.10 $3,444.06
539001-2 FILTR,SAW,914MHZ 20 $1.66 $33.20
539009-1 XTAL,QTZ,10.000000 MHZ 407 $5.00 $2,033.01
539008-1 XTAL,QTZ,28.59375 MHZ 121 $8.75 $1,058.75
539010-1 XTAL,QTZ,32.768 KHZ 596 $3.19 $1,898.86
529000AL6192FTA RES,R0402,.063W,1%,61.9K 2256 $0.02 $52.11
191115-3 PWB, PRISM PASS 4237 $2.05 $8,685.85
191510-1 SHIELD FRAME, PRISM PASS 4 $0.00 $0.00
529002-12 RES,VAR,100K,25%,2MM 244 $0.30 $73.69
529002-12 RES,VAR,100K,25%,2MM 2000 $0.31 $622.00
552000-13 SW,SEALED,SELECTOR,3MM SQ 40 $1.05 $41.84
552000-13 SW,SEALED,SELECTOR,3MM SQ 3000 $1.16 $3,465.00
552000-13 SW,SEALED,SELECTOR,3MM SQ 20 $1.72 $34.32
552000-13 SW,SEALED,SELECTOR,3MM SQ 615 $0.95 $584.25
Subtotal Aetec Furnished PASS Material $73,375.72
EXHIBIT B
C-Node Inventory
Part Number Description Qty Cost Extension
193786-1 ENCLOSURE, AC INLET 6 $5.00 $30.00
193787-1 COVER, AC INLET ENCLOSURE 7 $5.00 $35.00
46700108W3P3WB SLDR, SN63, WIRE, RMA, .15 DIA 2 $0.00 $0.00
524000-100 IC, MIC CTLR, 8-BIT, 16C73A-20 60 $6.06 $363.60
524000-200 IC,FIFO, 512X9, 50MHZ, 7201 52 $2.23 $115.96
524000-300 IC, FPGA, 22V10 45 $13.78 $620.02
524000-302 IC, FPGA, ISPLSI1024 3 $12.50 $37.50
524000-4 IC, GATE, OF, QUAD, 74ACT32 46 $0.19 $8.74
524000-5 IC,FLIP FLOP,D,DUAL, 74AC74 145 $0.21 $30.45
524000-8 IC, XCVR, BI-DIR, OCTAL, 74ABT245 15 $0.79 $11.85
524000-9 IC, BFR, OCTAL, 74FCT244 10 $0.88 $8.80
524001-1 IC, OP AMP,QUAD, 100MHHZ, LT1230 60 $9.13 $547.80
524001-100 IC, COMPTR, ULTRAFAST, AD9698 157 $3.30 $518.10
524001-2 IC, OP AMP,JFET,QUAD, LF347 126 $0.85 $107.47
524001-300 IC, CONV,D/A, 6-BIT, 8444 28 $1.78 $49.84
524001-400 IC, SWITCH, SPST, QUAD, MAX352 378 $1.76 $665.28
525000CP101AJTA CAP, C0805, 50V, NPO, 5%, 100PF 108 $0.02 $2.27
525000CP221AJTA CAP, C0805, 50V, NPO, 5%, 221PF 3394 $0.02 $73.99
525000CP681AJTA CAP, C0805, 50, NPO, 5%, 680PF 3392 $0.20 $690.61
525000CX104AJTA CAP, C0805, 50V,X7R, 5%, .10UF 6500 $0.04 $260.00
525000EP121AJTB CAP, C1206, 50V, NPO, 5%, 120PF 200 $0.05 $10.20
525001D106K35TA CAP, TANT, C7343, 35V, 10%, 10UF 313 $0.25 $79.22
526000-1 DIO, SHTKY,200NA@25V, MMBD301 330 $0.15 $49.50
526000-508 DIO, LED, RED, 5V, 3.5MA, INT. RES. 691 $0.54 $369.82
526000-510 DIO, LED, RED, METAL CASE 60 $3.55 $213.00
527000-102 XSTR, PNP,QD, EP2015 79 $1.65 $130.35
529000BL000JTA RES, R0603, 1AMP,0.0 5000 $0.00 $15.00
529000BL1001FTA RES, R0603, .100W, 1%, 1.00K 4998 $0.01 $59.48
529000BL104JTA RES, R0603, .100W, 5%, 100K 155 $0.01 $1.63
529000BL106JTA RES, R0603, .100W, 5%, 10M 281 $0.00 $0.84
529000BL112JTA RES, R0603, .100W, 5%, 1.10K 208 $0.01 $1.04
529000BL220JTA RES, R0603, .100W, 5%, 22.0 2763 $0.01 $13.82
529000BL222JTA RES, R0603, .100W, 5%, 2.20K 50 $0.01 $0.25
529000BL2490FTA RES, R0603,.100W, 1%, 249 90 $0.00 $0.35
529000BL331JTA RES, R0603, .100W, 5%, 330 327 $0.00 $0.95
529000BL332JTA RES, R0603,.100W, 5%, 3.30K 111 $0.01 $1.11
529000BL333JTA RES, R0603, .100W,5%, 33.0K 5084 $0.00 $14.74
529000BL4990FTA RES, R0603, .100W, 1%, 499 111 $0.02 $1.89
529001-104 RES, NTWK, 10 PIN, 220/330 OHM, 2% 89 $0.39 $34.91
529001-105 RES, NTWK, 10 PIN, 56/220 OHM, 5% 28 $0.40 $11.20
535000-1 IDCTR, CHIP, 32CS, 1UH, 10% 148 $0.35 $51.36
535000-2 IDCTR, AXIAL LEAD, 100UH, 10% 167 $1.93 $322.31
535000-3 IDCTR, RADIAL LEAD, 100UH, 10% 799 $1.93 $1,542.07
537001-3 PWR SPLY, MULTI O/PUT, MDLR 11 $1,372.00 $15,092.00
539003-1 OSC, XTAL, CLK, 80 MHZ, 14PDIP 26 $5.34 $138.84
540002-4 FLTR, EMI, LEADED 1 $51.00 $51.00
542001-1 PWR CD, 3 PRNG, SJT VINYL, 8FT 61 $2.49 $151.89
551000-1 FUSE, .75A, SURFSCE MT 1754 $0.72 $1,258.32
551001-1 CKT BKR, 15 AMP, RD LED 26 $14.92 $387.92
551001-4 CKT BKR, 8 AMP, RD LED 12 $16.00 $192.00
553000-1 BTN, EXT., TACTILE SW, RED 50 $0.09 $4.50
553001-11 TERM, LUG 260 $0.38 $99.74
553001-12 CONT, PL 139 $0.04 $5.56
553001-13 CONT, RCPT 932 $0.02 $15.75
553001-15 CONT, SKT 255 $0.07 $17.85
553001-4 CONT, RCPT 877 $0.11 $94.72
553001-5 CONT, PL 76 $0.06 $4.56
553001-6 CONT, PL 222 $0.06 $13.32
553001-8 CONT, PL 262 $0.08 $20.96
554000-28S HEADER, DIP, LOW PROFILE, 28 SCKT 53 $0.12 $6.36
554000-32W HEADER, DIP, LOW PROFILE, 32 SCKT 2 $0.36 $0.72
554000-40W HEADER, DIP, LOW PROFILE, 40 SCKT 43 $0.15 $6.45
562001-9 CLP, CVL, NYL, 10/32, 3/8X.500 279 $0.09 $24.38
564001-1 HDL, EJCTR, BOT, BLK 15 $2.23 $33.45
564001-100 HDW, MNTG, FOR 564001-1 &2 131 $0.91 $119.21
564001-102 BLT. SLTD, FOR 19" RACK 264 $11.48 $3,030.72
564001-104 HDW, INSL, M2.5 X 12 SCR W/ WSR 300 $0.95 $285.00
564001-107 TAPPED STRIPS 60 $5.41 $324.60
564001-2 HDL, EJCTR, TOP, BLK 14 $2.23 $31.22
564001-204 PNL, BLK, PCB, NO HDL, 6U 4HP 68 $7.64 $519.52
564001-408 FAN, COOLING, DC, 4.72" X 4.72" X 1.0 25 $12.00 $300.00
564001-409 FAN, GUARD, METAL 4.72" SQ 56 $1.01 $56.56
564001-411 FAN, TUBEAXIAL, 105CFM, 115VAC 4 $13.50 $54.00
564001-413 FAN, FILTER, AL, 4.25", CLR COAT 4 $4.50 $18.00
564001-415 FLTR, PANEL, EMI/DUST 8 $50.59 $404.72
564001-501 GDE R, PCB, ESD CONT, PLASTIC 705 $0.27 $190.35
564001-504 MTG KIT, 19" RK W/HDL, B, P SER. 14 $16.38 $229.32
571000PP1624PAZ SCR, PAN PH PL ST, 10-24 X .750, 78 $0.15 $11.70
571000PP1724PAZ SCR, PAN, PH, PL ST, 10-32 X .750 67 $0.15 $10.05
573000N17PAZ NUT, PL HEX/LCKWSR, PL ST, 10-32 38 $0.20 $7.60
573002-1 NUT, TINNERMAN, F TYPE, 10-24 129 $0.73 $94.49
577000-1 CONN, BNC,RT ANGLE, 50 OHM, WHT 191 $0.59 $111.74
577000-2 CONN, ROW, RT ANGLE, 96PIN, 3 ROW 17 $1.39 $23.63
577000-3 CONN, PCB MT, CPL,, 8 CKT 57 $0.35 $19.95
577000-4 CONN, PCV MT, RCPT, 8 CKY 92 $1.19 $109.48
577001-50 CONN, BNC, ADPTR, JACK TO JACK 198 $5.72 $1,132.56
577003-10 CONN, PIN, .093, LOOSE PIECE 1001 $0.05 $47.15
577003-2 CONN, ROW, SGL, HSG, .100 CTRS 2 $3.50 $7.00
577003-3 CONN, RCPT SHELL, INSULD 1999 $0.07 $133.73
577003-4 CONN, CBL, HSG 71 $0.19 $13.62
577004-1 CONN, D, PNL RCPT SHL, INSULD 23 $0.19 $4.37
577004-2 CONN, PNL PL SHL, INSULD 20 $3.25 $65.00
577004-3 CONN, PNL RCPT SHL 81 $0.23 $18.53
577004-4 CONN, PNL, PL, SHL 6 $0.34 $2.04
577004-6 CONN, PNL, HSG 76 $0.11 $8.36
579001-6 NUT, JAM, BNC CONN 415 $0.10 $40.67
579001-7 WSHR, LK, INT TOOTH, BNC CONN 333 $0.08 $27.91
602037-1 BRACKET, SUB RACK COVER 45 $4.75 $213.75
602038-1 PANEL SUB RACK COVER 26 $11.50 $299.00
602110-1 BACKPLANE, 4 SLOT, VME P1 1 $211.85 $211.85
602113-3 PWB DETAIL - TOA BOARD 46 $37.80 $1,738.80
602115-2 PWB DETAIL-MAST TIMING GENERAT 2 $84.00 $168.00
602232-1 PNL, FRNT, MOD., TOA BD. 4 $5.83 $23.32
602274-3 JUMPER CBL DUAL TERM 1 $0.19 $0.19
M16878/1BKE3 WIRE, STRD, PVC, 14 AWG, ORN 200 $0.10 $20.00
MS15795-806 WSHR, FL, CRES, #6, .156ID X .375OD 244 $0.20 $48.80
MS35649-264 NUT, PL HEX, CRES, .138-32 330 $0.19 $62.70
MS51957-17 SCR, PAN HD, XRCSS, .112-40 X .500 23 $0.15 $3.45
MS51957-30 SCR, PAN HD, XRCSS, .138-32 X .500 790 $0.09 $71.10
MS51957-36 SCR, PAN HD, XRCSS, .138-32 X 1.500 97 $0.14 $13.58
529000BL101JTA RES, R0603, .100W, 5%, 100 20 $0.50 $10.00
529000BL102JTA RES, R0603, .100W, 5%, 1.00K 102 $0.50 $51.00
564001-108 SCR, CHEESEHEAD, 2.5MM X 12MM 218 $1.20 $261.60
M16878/1BKE5 WIRE, STRD, PVC, 14 AWG, GRN 150 $0.45 $67.50
577000-10 CONN, ROW, RCPT, 96P, 3R, .180LG 3 $3.50 $10.50
527000-100 XSTR, PNP, 2N2907A 28 $0.02 $0.53
193686-1 CCA, CNODE INTERFACE 1 $234.00 $234.00
553001-10 TERM, RING TONGUE, INSLTD 8 $0.20 $1.60
577003-8 CONN, SHELL, PLUG, .093 PIN &SKT 90 $1.69 $152.10
553001-13 CONT, RCPT 7 $0.02 $0.12
Total C-Node Inventory $37,397.68