What changed in OPTICAL CABLE CORP's 10-K — 2023 vs 2024
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Paragraph-level year-over-year comparison of OPTICAL CABLE CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.
+74 added−51 removedSource: 10-K (2024-12-23) vs 10-K (2023-12-20)
Top changes in OPTICAL CABLE CORP's 2024 10-K
74 paragraphs added · 51 removed · 47 edited across 1 sections
- Item 1A. Risk Factors+74 / −51 · 47 edited
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
47 edited+27 added−4 removed15 unchanged
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
47 edited+27 added−4 removed15 unchanged
2023 filing
2024 filing
Biggest changeSmith effective April 11, 2011, as amended December 18, 2012 (incorporated herein by reference to Exhibit 10.22 of the Company’ s Quarterly Report on Form 10-Q for the period ended January 31, 2014 filed March 17, 2014). 10.8* Form of vesting award agreement for non-employee Board members under the Optical Cable Corporation 2017 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.21 of the Company’ s Quarterly Report on Form 10-Q for the period ended April 30, 2017 filed June 13, 2017). 10.9* Form of operational performance (Company financial performance measure) vesting award agreement under the Optical Cable Corporation 2017 Stock Incentive Plan (incorporated by reference to Exhibit 10.15 of the Company ’ s Annual Report on Form 10-K for the period ended October 31, 2021 filed December 20, 2021). 10.10* First Amendment to the Optical Cable Corporation 2017 Stock Incentive Plan effective March 29, 2022 (incorporated herein by reference to Exhibit 10.16 of the Company’ s Quarterly Report on Form 10-Q for the period ended July 31, 2022 filed September 12, 2022). 13.1 Annual Report.
Biggest changeSmith effective April 11, 2011, as amended December 18, 2012 (incorporated herein by reference to Exhibit 10.22 of the Company’s Quarterly Report on Form 10-Q for the period ended January 31, 2014 filed March 17, 2014). 10.8* Form of vesting award agreement for non-employee Board members under the Optical Cable Corporation 2017 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.21 of the Company’s Quarterly Report on Form 10-Q for the period ended April 30, 2017 filed June 13, 2017). 10.9* Form of operational performance (Company financial performance measure) vesting award agreement under the Optical Cable Corporation 2017 Stock Incentive Plan (incorporated by reference to Exhibit 10.15 of the Company’s Annual Report on Form 10-K for the period ended October 31, 2021 filed December 20, 2021). 10.10* First Amendment to the Optical Cable Corporation 2017 Stock Incentive Plan effective March 29, 2022 (incorporated herein by reference to Exhibit 10.16 of the Company’s Quarterly Report on Form 10-Q for the period ended July 31, 2022 filed September 12, 2022). 10.11* Form of vesting award agreement for non-employee Board members under the Optical Cable Corporation 2017 Stock Incentive Plan, as amended (incorporated herein by reference to Exhibit 10.11 of the Company’s Quarterly Report on Form 10-Q for the period ended July 31, 2024 filed September 11, 2024). 10.12* Form of operational performance (Company financial performance measure) vesting award agreement under the Optical Cable Corporation 2017 Stock Incentive Plan, as amended (incorporated herein by reference to Exhibit 10.12 of the Company’s Quarterly Report on Form 10-Q for the period ended July 31, 2024 filed September 11, 2024). 13.1 Annual Report.
Our Roanoke facility is situated on approximately 23 acres of land (of which 11 acres is currently unused) located near the Roanoke-Blacksburg Regional Airport in Roanoke, Virginia, interstate I-81, and major trucking company facilities. Our Roanoke facility building is approximately 146,000 square feet.
Our Roanoke facility is situated on approximately 23 acres of land (of which approximately 11 acres is currently unused) located near the Roanoke-Blacksburg Regional Airport in Roanoke, Virginia, interstate I-81, and major trucking company facilities. Our Roanoke facility building is approximately 146,000 square feet.
FILED HEREWITH. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). * Management contract or compensatory plan or agreement. 16 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FILED HEREWITH. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). _________________________ * Management contract or compensatory plan or agreement. 17 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Certain risk factors that may adversely affect the Company, the Company’s future results of operations and future financial condition, and future market valuation of the Company are mentioned under “Forward-Looking Information” included in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report for the fiscal year ended October 31, 2023 (filed as Exhibit 13.1 to this report on Form 10-K), and in our Quarterly Reports on Form 10-Q.
Certain risk factors that may adversely affect the Company, the Company’s future results of operations and future financial condition, and future market valuation of the Company are mentioned under “Forward-Looking Information” included in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report for the fiscal year ended October 31, 2024 (filed as Exhibit 13.1 to this report on Form 10-K), and in our Quarterly Reports on Form 10-Q.
We lease a warehouse facility in Roanoke, Virginia. The space leased is approximately 36,000 square feet and is used primarily to store raw materials and other items related to our fiber optic cable operations. We believe that we operated at approximately 40% to 50% of our production equipment capacity on average at our collective manufacturing facilities during fiscal year 2023.
We lease a warehouse facility in Roanoke, Virginia. The space leased is approximately 36,000 square feet and is used primarily to store raw materials and other items related to our fiber optic cable operations. We believe that we operated at approximately 40% to 50% of our production equipment capacity on average at our collective manufacturing facilities during fiscal year 2024.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The information contained under the captions “Consolidated Financial Statements,” “Notes to Consolidated Financial Statements,” and “Report of Independent Registered Public Accounting Firm” of our Annual Report for the fiscal year ended October 31, 2023, filed as Exhibit 13.1 to this report on Form 10-K, is incorporated herein by reference. Item 9.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The information contained under the captions “Consolidated Financial Statements,” “Notes to Consolidated Financial Statements,” and “Report of Independent Registered Public Accounting Firm” of our Annual Report for the fiscal year ended October 31, 2024, filed as Exhibit 13.1 to this report on Form 10-K, is incorporated herein by reference. Item 9.
Todd Ross (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Modification of Deed of Trust, Security Agreement and Assignment of Leases and Rents dated April 26, 2016, which previously modified that certain Corrected Deed of Trust, Security Agreement and Assignment of Leases and Rents dated May 30, 2008 (incorporated herein by reference to Exhibit 4.21 to the Company ’ s Quarterly Report on Form 10-Q for the second quarter ended April 30, 2018). 4.11 Loan and Security Agreement dated July 24, 2020 by and among Optical Cable Corporation along with its subsidiaries Applied Optical Systems, Inc. and Centric Solutions LLC, and North Mill Capital LLC (now doing business as SLR Business Credit) (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed July 30, 2020). 4.12 Revolving Credit Master Promissory Note dated July 24, 2020 by Optical Cable Corporation along with its subsidiaries Applied Optical Systems, Inc. and Centric Solutions LLC in favor of North Mill Capital LLC (now doing business as SLR Business Credit) (incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed July 30, 2020). 4.13 Payoff Letter from Pinnacle Bank to North Mill Capital LLC (now doing business as SLR Business Credit) and Optical Cable Corporation (incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed July 30, 2020). 4.14 Amended and Restated Stockholder Protection Rights Agreement, dated as of November 2, 2021, between Optical Cable Corporation and American Stock Transfer & Trust Company, LLC, as rights agent (incorporated herein by reference to Exhibit 4.1 to the Company’ s Form 8-A12G filed with the Commission on November 5, 2021). 4.15 Modification Agreement dated as of July 5, 2022, by and between North Mill Capital LLC (now doing business as SLR Business Credit) and Optical Cable Corporation along with its subsidiaries Applied Optical Systems, Inc., and Centric Solutions LLC (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed July 7, 2022). 4.16 Omnibus Amendment of Loan Documents dated October 31, 2023 by and between Optical Cable Corporation and Northeast Bank (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed November 3, 2023). 10.1* Optical Cable Corporation 2017 Stock Incentive Plan (incorporated by reference to Appendix A to the Company’ s definitive proxy statement on Form 14A filed March 13, 2017). 14 Table of Contents 10.2* Amended and Restated Employment Agreement by and between Optical Cable Corporation and Neil D.
Todd Ross (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Modification of Deed of Trust, Security Agreement and Assignment of Leases and Rents dated April 26, 2016, which previously modified that certain Corrected Deed of Trust, Security Agreement and Assignment of Leases and Rents dated May 30, 2008 (incorporated herein by reference to Exhibit 4.21 to the Company's Quarterly Report on Form 10-Q for the second quarter ended April 30, 2018). 4.10 Loan and Security Agreement dated July 24, 2020 by and among Optical Cable Corporation along with its subsidiaries Applied Optical Systems, Inc. and Centric Solutions LLC, and North Mill Capital LLC (now doing business as SLR Business Credit) (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed July 30, 2020). 4.11 Revolving Credit Master Promissory Note dated July 24, 2020 by Optical Cable Corporation along with its subsidiaries Applied Optical Systems, Inc. and Centric Solutions LLC in favor of North Mill Capital LLC (now doing business as SLR Business Credit) (incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed July 30, 2020). 4.12 Payoff Letter from Pinnacle Bank to North Mill Capital LLC (now doing business as SLR Business Credit) and Optical Cable Corporation (incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed July 30, 2020). 4.13 Amended and Restated Stockholder Protection Rights Agreement, dated as of November 2, 2021, between Optical Cable Corporation and American Stock Transfer & Trust Company, LLC, as rights agent (incorporated herein by reference to Exhibit 4.1 to the Company’s Form 8-A12G filed with the Commission on November 5, 2021). 4.14 Modification Agreement dated as of July 5, 2022, by and between North Mill Capital LLC (now doing business as SLR Business Credit) and Optical Cable Corporation along with its subsidiaries Applied Optical Systems, Inc., and Centric Solutions LLC (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed July 7, 2022). 4.15 Omnibus Amendment of Loan Documents dated October 31, 2023 by and between Optical Cable Corporation and Northeast Bank (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed November 3, 2023). 10.1* Optical Cable Corporation 2017 Stock Incentive Plan (incorporated by reference to Appendix A to the Company’s definitive proxy statement on Form 14A filed March 13, 2017). 10.2* Amended and Restated Employment Agreement by and between Optical Cable Corporation and Neil D.
MARKET FOR REGISTRANT ’ S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The information pertaining to shareholders beneficially owning more than five percent of the Company’s common stock and the security ownership of management, which is set forth under the caption “Beneficial Ownership of Securities” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
MARKET FOR REGISTRANT ’ S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The information pertaining to shareholders beneficially owning more than five percent of the Company’s common stock and the security ownership of management, which is set forth under the caption “Beneficial Ownership of Securities” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information concerning stock ownership by directors, executive officers and shareholders beneficially owning more than five percent of the Company’s common stock, which is set forth under the caption “Beneficial Ownership of Securities” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information concerning stock ownership by directors, executive officers and shareholders beneficially owning more than five percent of the Company’s common stock, which is set forth under the caption “Beneficial Ownership of Securities” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information contained under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report for the fiscal year ended October 31, 2023, filed as Exhibit 13.1 to this report on Form 10-K, is incorporated herein by reference. Item 7A.
MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information contained under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report for the fiscal year ended October 31, 2024, filed as Exhibit 13.1 to this report on Form 10-K, is incorporated herein by reference. Item 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company did not engage in transactions in derivative financial instruments or derivative commodity instruments. As of October 31, 2023, the Company’s financial instruments were not exposed to significant market risk due to interest rate risk, foreign currency exchange risk, commodity price risk or equity price risk. Item 8.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company did not engage in transactions in derivative financial instruments or derivative commodity instruments. As of October 31, 2024, the Company’s financial instruments were not exposed to significant market risk due to interest rate risk, foreign currency exchange risk, commodity price risk or equity price risk. Item 8.
The information with respect to compliance with Section 16(a) of the Securities Exchange Act of 1934, which is set forth under the caption “Delinquent Section 16(a) Reports” (if applicable) in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
The information with respect to compliance with Section 16(a) of the Securities Exchange Act of 1934, which is set forth under the caption “Delinquent Section 16(a) Reports” (if applicable) in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information with respect to certain transactions with management of the Company, which is set forth under the caption “Certain Relationships and Related Transactions” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, is incorporated herein by reference. Item 14.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information with respect to certain transactions with management of the Company, which is set forth under the caption “Certain Relationships and Related Transactions” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, is incorporated herein by reference. Item 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES The information with respect to certain principal accountant fees and services, which is set forth under the caption “Independent Registered Public Accounting Firm” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
PRINCIPAL ACCOUNTANT FEES AND SERVICES The information with respect to certain principal accountant fees and services, which is set forth under the caption “Independent Registered Public Accounting Firm” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, is incorporated herein by reference.
Agee (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Corrected Credit Line Deed of Trust dated June 4, 2008 (incorporated herein by reference to Exhibit 4.5 to the Company ’ s Current Report on Form 8-K/A filed May 3, 2016). 4.8 Modification of Deed of Trust, Security Agreement, and Assignment of Leases and Rents dated April 26, 2016 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, Andrew B.
Agee (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Corrected Credit Line Deed of Trust dated June 4, 2008 (incorporated herein by reference to Exhibit 4.5 to the Company ’ s Current Report on Form 8-K/A filed May 3, 2016). 14 Table of Contents 4.7 Modification of Deed of Trust, Security Agreement, and Assignment of Leases and Rents dated April 26, 2016 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, Andrew B.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE For information with respect to the Directors of the registrant, see “Election of Directors,” and “Executive Officers” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, which information is incorporated herein by reference.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE For information with respect to the Directors of the registrant, see “Election of Directors,” and “Executive Officers” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, which information is incorporated herein by reference.
Wilkin, Jr. effective April 11, 2011, as amended December 18, 2012 (incorporated herein by reference to Exhibit 10.19 of the Company’ s Quarterly Report on Form 10-Q for the period ended January 31, 2014 filed March 17, 2014). 10.5* Amended and Restated Employment Agreement by and between Optical Cable Corporation and Tracy G.
Wilkin, Jr. effective April 11, 2011, as amended December 18, 2012 (incorporated herein by reference to Exhibit 10.19 of the Company’s Quarterly Report on Form 10-Q for the period ended January 31, 2014 filed March 17, 2014). 10.5* Amended and Restated Employment Agreement by and between Optical Cable Corporation and Tracy G.
Smith effective April 11, 2011 (incorporated herein by reference to Exhibit 10.18 of the Company’ s Quarterly Report on Form 10-Q for the period ended January 31, 2013 filed March 15, 2013). 10.7* Second Amendment, effective March 14, 2014, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Tracy G.
Smith effective April 11, 2011 (incorporated herein by reference to Exhibit 10.18 of the Company’s Quarterly Report on Form 10-Q for the period ended January 31, 2013 filed March 15, 2013). 10.7* Second Amendment, effective March 14, 2014, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Tracy G.
Todd Ross (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Modification of Credit Line Deed of Trust dated April 26, 2016, which previously modified that certain Corrected Credit Line Deed of Trust dated June 4, 2008 (incorporated herein by reference to Exhibit 4.20 to the Company ’ s Quarterly Report on Form 10-Q for the second quarter ended April 30, 2018). 4.10 Second Modification of Deed of Trust, Security Agreement, and Assignment of Leases and Rents dated May 2, 2018 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, W.
Todd Ross (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Modification of Credit Line Deed of Trust dated April 26, 2016, which previously modified that certain Corrected Credit Line Deed of Trust dated June 4, 2008 (incorporated herein by reference to Exhibit 4.20 to the Company’s Quarterly Report on Form 10-Q for the second quarter ended April 30, 2018). 4.9 Second Modification of Deed of Trust, Security Agreement, and Assignment of Leases and Rents dated May 2, 2018 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, W.
As of October 31, 2023, the Company completed an evaluation, under the supervision and with the participation of management, including the chief executive officer and the chief financial officer (principal accounting officer and principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures.
As of October 31, 2024, the Company completed an evaluation, under the supervision and with the participation of management, including the chief executive officer and the chief financial officer (principal accounting officer and principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures.
Description 3.1 Articles of Amendment filed November 5, 2001 to the Amended and Restated Articles of Incorporation, as amended through November 5, 2001 (incorporated herein by reference to Exhibit 1 to the Company’ s Form 8-A12G filed with the Commission on November 5, 2001). 3.2 Articles of Amendment filed July 5, 2002 to the Amended and Restated Articles of Incorporation, as amended through July 5, 2002 (incorporated herein by reference to Appendix A to the Company’ s definitive proxy statement on Form 14A filed July 5, 2002). 3.3 Amended and Restated Bylaws of Optical Cable Corporation (incorporated herein by reference to Exhibit 3.2 to the Company’ s Quarterly Report on Form 10-Q for the third quarter ended July 31, 2011). 3.4 Amended and Restated Bylaws of Optical Cable Corporation effective March 9, 2023 (incorporated herein by reference to Exhibit 3.4 to the Company’ s Quarterly Report on Form 10-Q for the first quarter ended January 31, 2023). 4.1 Form of certificate representing Common Stock (incorporated herein by reference to Exhibit 4.1 to the Company’ s Quarterly Report on Form 10-Q for the third quarter ended July 31, 2004 (file number 0-27022)). 4.2 Form of certificate representing Common Stock (incorporated herein by reference to Exhibit 4.2 to the Company’ s Quarterly Report on Form 10-Q for the third quarter ended July 31, 2012). 4.3 Corrected Credit Line Deed of Trust dated June 4, 2008 between Optical Cable Corporation as Grantor, LeClairRyan as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina, successor by merger with Valley Bank) as Beneficiary (incorporated herein by reference to Exhibit 4.17 of the Company ’ s Annual Report on Form 10-K for the period ended October 31, 2008 filed January 29, 2009). 4.4 Corrected Deed of Trust, Security Agreement and Fixtures Filing dated May 30, 2008 by and between Superior Modular Products Incorporated as Grantor, LeClairRyan as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina, successor by merger with Valley Bank) as Beneficiary (incorporated herein by reference to Exhibit 4.18 of the Company ’ s Annual Report on Form 10-K for the period ended October 31, 2008 filed January 29, 2009). 4.5 Term Loan A Note in the amount of $1,816,609 by Optical Cable Corporation dated April 26, 2016, for the benefit of Northeast Bank as of July 15, 2021, as successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) (incorporated herein by reference to Exhibit 4.3 to the Company ’ s Current Report on Form 8-K/A filed May 3, 2016). 4.6 Term Loan B Note in the amount of $5,271,411 by Optical Cable Corporation dated April 26, 2016, for the benefit of Northeast Bank as of July 15, 2021, as successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) (incorporated herein by reference to Exhibit 4.4 to the Company ’ s Current Report on Form 8-K/A filed May 3, 2016). 13 Table of Contents 4.7 Modification of Credit Line Deed of Trust dated April 26, 2016 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, Andrew B.
Description 3.1 Articles of Amendment filed November 5, 2001 to the Amended and Restated Articles of Incorporation, as amended through November 5, 2001 (incorporated herein by reference to Exhibit 1 to the Company’s Form 8-A12G filed with the Commission on November 5, 2001). 3.2 Articles of Amendment filed July 5, 2002 to the Amended and Restated Articles of Incorporation, as amended through July 5, 2002 (incorporated herein by reference to Appendix A to the Company’s definitive proxy statement on Form 14A filed July 5, 2002). 3.3 Amended and Restated Bylaws of Optical Cable Corporation effective October 15, 2010 (incorporated herein by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q for the third quarter ended July 31, 2011). 3.4 Amended and Restated Bylaws of Optical Cable Corporation effective March 9, 2023 (incorporated herein by reference to Exhibit 3.4 to the Company’s Quarterly Report on Form 10-Q for the first quarter ended January 31, 2023). 4.1 Form of certificate representing Common Stock (incorporated herein by reference to Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q for the third quarter ended July 31, 2004 (file number 0-27022)). 4.2 Form of certificate representing Common Stock (incorporated herein by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q for the third quarter ended July 31, 2012). 4.3 Corrected Credit Line Deed of Trust dated June 4, 2008 between Optical Cable Corporation as Grantor, LeClairRyan as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina, successor by merger with Valley Bank) as Beneficiary (incorporated herein by reference to Exhibit 4.17 of the Company ’ s Annual Report on Form 10-K for the period ended October 31, 2008 filed January 29, 2009). 4.4 Corrected Deed of Trust, Security Agreement and Fixtures Filing dated May 30, 2008 by and between Superior Modular Products Incorporated as Grantor, LeClairRyan as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina, successor by merger with Valley Bank) as Beneficiary (incorporated herein by reference to Exhibit 4.18 of the Company’s Annual Report on Form 10-K for the period ended October 31, 2008 filed January 29, 2009). 4.5 Term Loan B Note in the amount of $5,271,411 by Optical Cable Corporation dated April 26, 2016, for the benefit of Northeast Bank as of July 15, 2021, as successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) (incorporated herein by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K/A filed May 3, 2016). 4.6 Modification of Credit Line Deed of Trust dated April 26, 2016 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, Andrew B.
Agee (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Corrected Deed of Trust, Security Agreement and Assignment of Leases and Rents dated May 30, 2008 (incorporated herein by reference to Exhibit 4.6 to the Company ’ s Current Report on Form 8-K/A filed May 3, 2016). 4.9 Second Modification of Credit Line Deed of Trust dated May 2, 2018 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, W.
Agee (in substitution of LeClairRyan) as Trustee and Northeast Bank, successor in interest to Pinnacle Bank (successor by merger with Bank of North Carolina) as Beneficiary, modifying that certain Corrected Deed of Trust, Security Agreement and Assignment of Leases and Rents dated May 30, 2008 (incorporated herein by reference to Exhibit 4.6 to the Company’s Current Report on Form 8-K/A filed May 3, 2016). 4.8 Second Modification of Credit Line Deed of Trust dated May 2, 2018 by and between Optical Cable Corporation (successor by merger to Superior Modular Products Incorporated) as Grantor, W.
Wilkin, Jr. effective April 11, 2011 (incorporated herein by reference to Exhibit 10.2 of the Company’ s Current Report on Form 8-K filed April 15, 2011). 10.3* Amendment, effective December 18, 2012, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Neil D.
Wilkin, Jr. effective April 11, 2011 (incorporated herein by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed April 15, 2011). 10.3* Amendment, effective December 18, 2012, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Neil D.
For information with respect to the executive officers of the registrant, see “Executive Officers” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company, which information is incorporated herein by reference.
For information with respect to the executive officers of the registrant, see “Executive Officers” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company, which information is incorporated herein by reference.
Smith effective April 11, 2011 (incorporated herein by reference to Exhibit 10.1 of the Company’ s Current Report on Form 8-K filed April 15, 2011). 10.6* Amendment, effective December 18, 2012, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Tracy G.
Smith effective April 11, 2011 (incorporated herein by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed April 15, 2011). 10.6* Amendment, effective December 18, 2012, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Tracy G.
The office building is separate from our manufacturing building, which houses our manufacturing operations and certain offices at the same location. There was no significant impact to our operations as a result of this event. 8 Table of Contents We lease our facility near Dallas, Texas (in Plano, Texas).
The office building is separate from our manufacturing building, which houses our manufacturing operations and certain offices at the same location. There was no significant impact to our operations as a result of this event. We lease our facility near Dallas, Texas (in Plano, Texas).
Smith Senior Vice President and Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated as of December 20, 2023. Date: December 20, 2023 /S/ Neil D. Wilkin, Jr. Neil D. Wilkin, Jr.
Smith Senior Vice President and Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated as of December 23, 2024. Date: December 23, 2024 /S/ NEIL D. WILKIN, JR. Neil D. Wilkin, Jr.
FILED HEREWITH. 32.1 Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. FURNISHED HEREWITH. 32.2 Certification of the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
FILED HEREWITH. 31.2 Certification of the Company’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. FILED HEREWITH. 32.1 Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Wilkin, Jr. effective April 11, 2011 (incorporated herein by reference to Exhibit 10.16 of the Company’ s Quarterly Report on Form 10-Q for the period ended January 31, 2013 filed March 15, 2013). 10.4* Second Amendment, effective March 14, 2014, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Neil D.
Wilkin, Jr. effective April 11, 2011 (incorporated herein by reference to Exhibit 10.16 of the Company’s Quarterly Report on Form 10-Q for the period ended January 31, 2013 filed March 15, 2013). 15 Table of Contents 10.4* Second Amendment, effective March 14, 2014, to Amended and Restated Employment Agreement by and between Optical Cable Corporation and Neil D.
The information contained under the caption “Corporate Information” of our Annual Report for the fiscal year ended October 31, 2023, filed as Exhibit 13.1 to this report on Form 10-K, is incorporated herein by reference. 9 Table of Contents Item 6. RESERVED Item 7.
The information contained under the caption “Corporate Information” of our Annual Report for the fiscal year ended October 31, 2024, filed as Exhibit 13.1 to this report on Form 10-K, is incorporated herein by reference. Item 6. RESERVED Item 7.
(a) List of documents filed as part of this report: 1. Financial statements: The Company’s consolidated financial statements and related notes thereto are hereby incorporated by reference to pages 20 to 42 of the Company’s Annual Report filed as Exhibit 13.1 to this Form 10-K. 2.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a) List of documents filed as part of this report: 1. Financial statements: The Company’s consolidated financial statements and related notes thereto are hereby incorporated by reference to pages 20 to 46 of the Company’s Annual Report filed as Exhibit 13.1 to this Form 10-K. 2.
The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to be effective in providing reasonable assurance that information required to be disclosed in reports under the Exchange Act are recorded, processed and summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “SEC”), and that such information is accumulated and communicated to management to allow for timely decisions regarding required disclosure.
The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to be effective in providing reasonable assurance that information required to be disclosed in reports under the Exchange Act are recorded, processed and summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to management to allow for timely decisions regarding required disclosure.
OPTICAL CABLE CORPORATION Date: December 20, 2023 By: /S/ Neil D. Wilkin, Jr. Neil D. Wilkin, Jr. Chairman of the Board of Directors, President and Chief Executive Officer Date: December 20, 2023 By: /S/ Tracy G. Smith Tracy G.
OPTICAL CABLE CORPORATION Date: December 23, 2024 By: /S/ NEIL D. WILKIN, JR. Neil D. Wilkin, Jr. Chairman of the Board of Directors, President and Chief Executive Officer Date: December 23, 2024 By: /S/ TRACY G. SMITH Tracy G.
EXECUTIVE COMPENSATION The information set forth under the captions “Executive Compensation,” and “Director Compensation” in the Proxy Statement for the 2024 Annual Meeting of Shareholders of the Company is incorporated herein by reference. 11 Table of Contents Item 12.
EXECUTIVE COMPENSATION The information set forth under the captions “Executive Compensation,” and “Director Compensation” in the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company is incorporated herein by reference. Item 12.
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) or 15d-15(f) under the Exchange Act).
Management ’ s Annual Report on Internal Control Over Financial Reporting. Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) or 15d-15(f) under the Exchange Act).
The information concerning the Company’s code of ethics that applies to the Company’s principal executive officer and the Company’s senior financial officers required by this Item is incorporated by reference to the Company’s Proxy Statement under the heading “Code of Ethics.” Item 11.
The information concerning the Company’s code of ethics that applies to the Company’s principal executive officer and the Company’s senior financial officers required by this Item is incorporated herein by reference to the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company under the heading “Code of Ethics.” Item 11.
FILED HEREWITH. 21.1 List of Subsidiaries. FILED HEREWITH. 23.1 Consent of Independent Registered Public Accounting Firm. FILED HEREWITH. 31.1 Certification of the Company’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. FILED HEREWITH. 31.2 Certification of the Company’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
FILED HEREWITH. 21.1 List of Subsidiaries. FILED HEREWITH. 23.1 Consent of Independent Registered Public Accounting Firm. FILED HEREWITH. 23.2 Consent of Brown, Edwards and Company, L.L.P. FILED HEREWITH. 31.1 Certification of the Company’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
There were no changes in the Company’s internal controls over financial reporting during the fourth quarter of the fiscal year covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Item 9B. OTHER INFORMATION None. PART III Item 10.
Changes in Internal Control Over Financial Reporting. There were no changes in the Company’s internal controls over financial reporting during the fourth quarter of the fiscal year covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Chairman of the Board of Directors, President and Chief Executive Officer Date: December 20, 2023 /S/ Randall H. Frazier Randall H. Frazier Director Date: December 20, 2023 /S/ John M. Holland John M. Holland Director Date: December 20, 2023 /S/ John A. Nygren John A. Nygren Director Date: December 20, 2023 /S/ Craig H. Weber Craig H. Weber Director 17
Chairman of the Board of Directors, President and Chief Executive Officer Date: December 23, 2024 /S/ RANDALL H. FRAZIER Randall H. Frazier Director Date: December 23, 2024 /S/ JOHN M. HOLLAND John M. Holland Director Date: December 23, 2024 /S/ JOHN A. NYGREN John A. Nygren Director Date: December 23, 2024 /S/ CRAIG H. WEBER Craig H. Weber Director 18
The information concerning securities authorized for issuance under equity compensation plans required by this Item is incorporated by reference to the Company’s Proxy Statement under the heading “Equity Compensation Plan Information.” Item 13.
The information concerning securities authorized for issuance under equity compensation plans required by this Item is incorporated herein by reference to the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company under the heading “Equity Compensation Plan Information.” Item 13.
The information concerning pre-approval policies for audit and non-audit services required by this Item is incorporated by reference to the Company’s Proxy Statement under the heading “Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm.” 12 Table of Contents PART IV Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The information concerning pre-approval policies for audit and non-audit services required by this Item is incorporated herein by reference to the Proxy Statement for the 2025 Annual Meeting of Shareholders of the Company under the heading “Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm.” 13 Table of Contents PART IV Item 15.
The Company had 7,893,681 shares of common stock issued and outstanding at October 31, 2023. Employees of the Company and members of the Board of Directors owned at least 34.6% of the shares issued and outstanding at October 31, 2023, including shares still subject to potential forfeiture based on vesting requirements.
The Company had 8,220,344 shares of common stock issued and outstanding at October 31, 2024. Employees of the Company and members of the Board of Directors owned at least 36.9% of the shares issued and outstanding at October 31, 2024, including shares still subject to potential forfeiture based on vesting requirements.
FILED HEREWITH. 101 The following materials from the Company’s Annual Report on Form 10-K for the year ended October 31, 2023, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of October 31, 2023 and 2022, (ii) Consolidated Statements of Operations for the years ended October 31, 2023, 2022 and 2021, (iii) Consolidated Statements of Shareholders’ Equity for the years ended October 31, 2023, 2022 and 2021, (iv) Consolidated Statements of Cash Flows for the years ended October 31, 2023, 2022 and 2021, and (v) Notes to Consolidated Financial Statements.
FURNISHED HEREWITH. 16 Table of Contents 97 Optical Cable Corporation Compensation Recovery Policy, effective November 30, 2023 incorporated herein by reference to Exhibit 97 of the Company’s Annual Report on Form 10-K for the period ended October 31, 2023 filed December 20, 2023). 101 The following materials from the Company’s Annual Report on Form 10-K for the year ended October 31, 2024, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of October 31, 2024 and 2023, (ii) Consolidated Statements of Operations for the years ended October 31, 2024 and 2023, (iii) Consolidated Statements of Shareholders’ Equity for the years ended October 31, 2024 and 2023, (iv) Consolidated Statements of Cash Flows for the years ended October 31, 2024 and 2023, and (v) Notes to Consolidated Financial Statements.
Additionally, we can experience capacity constraints based on the types of products that are being manufactured at any given time and related inherent limitations in the manufacturing process as well as the time it takes to hire and train new employees.
Additionally, we can experience capacity constraints based on the types of products that are being manufactured at any given time and related inherent limitations in the manufacturing process as well as the time it takes to hire and train new employees. 9 Table of Contents Additional personnel would need to be hired and trained, additional warehousing space may be needed, and, depending on product mix, certain additional production equipment may need to be acquired, to fully utilize our available production equipment capacity at all of our facilities.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There were no changes in our accountants and the Company did not have any disagreements with its accountants on any accounting matter or financial disclosure made during our fiscal year ended October 31, 2023. Item 9A. CONTROLS AND PROCEDURES Disclosure Controls and Procedures.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE The Company changed its principal accountants for its fiscal year ended October 31, 2024 from Brown, Edwards & Company, L.L.P. to Crowe LLP. We did not have any disagreements with our current accountants on any accounting matter or financial disclosure made during our fiscal year ended October 31, 2024.
Item 1B. UNRESOLVED STAFF COMMENTS None. Item 2. PROPERTIES We own our facility located in Roanoke County, Virginia, and the land on which our Roanoke facility is located. Our Roanoke facility primarily houses our corporate headquarters, our administrative offices, our fiber optic cable manufacturing operations, our fiber optic cable product development function and our fiber optic cable warehouse.
Our Roanoke facility primarily houses our corporate headquarters, our administrative offices, our fiber optic cable manufacturing operations, our fiber optic cable product development function and our fiber optic cable warehouse.
Management conducted an evaluation of the design and effectiveness of the Company’s system of internal control over financial reporting as of October 31, 2023, based on the framework set forth in “Internal Control - Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
Management conducted an evaluation of the design and effectiveness of the Company’s system of internal control over financial reporting as of October 31, 2024, based on the framework set forth in “Internal Control - Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. 11 Table of Contents In connection with the restatement of the Company’s financial statements included in its Annual Report filed with this Form 10-K, management, including the chief executive officer and chief financial officer, have evaluated the effectiveness of internal control over financial reporting and concluded that the Company did not maintain effective internal control over financial reporting as of October 31, 2024 because of a material weakness in the Company’s internal control over financial reporting described herein related to the classification of outstanding balances on its Revolver.
Removed
Additional personnel would need to be hired and trained, additional warehousing space may be needed, and, depending on product mix, certain additional production equipment may need to be acquired, to fully utilize our available production equipment capacity at all of our facilities.
Added
Item 1B. UNRESOLVED STAFF COMMENTS None. Item 1C. CYBERSECURITY The Company is subject to attempted cyberattacks and other cybersecurity risks. Our business relies on various information technology and application systems that may be impacted by a malicious cyberattack.
Removed
Based upon that evaluation, the chief executive officer and chief financial officer concluded that the Company’s disclosure controls and procedures were effective as of October 31, 2023. 10 Table of Contents Management ’ s Annual Report on Internal Control Over Financial Reporting.
Added
Such cyber incidents may cause lost revenues or increased expenses stemming from inability to use certain systems for a period of time, loss of financial assets, fines related to breach of personally identifiable information or other protected information, reputational damage and remediation and litigation costs as well as increased cybersecurity protection costs.
Removed
Based on its evaluation, management concluded that, as of October 31, 2023, the Company’s internal control over financial reporting was effective. Changes in Internal Control Over Financial Reporting.
Added
We regularly evaluate cybersecurity risks from computer viruses and more sophisticated and targeted cyber-related attacks such as ransomware, as well as cybersecurity failures resulting from human error and technological errors. Such risks are monitored and reviewed by management on a periodic basis as deemed appropriate.
Removed
FURNISHED HEREWITH. 15 Table of Contents 97 Optical Cable Corporation Compensation Recovery Policy, effective November 30, 2023.
Added
We have developed and continue to invest in a variety of solutions and controls for real-time threat prevention, detection and instantaneous, automated reaction to such cyberattacks.
Added
Our overall strategy in combatting known cybersecurity risks includes: ● The use of antivirus software, virtual private networks, email security, as well as other software to prevent and detect intrusions such as identity attacks. ● Engagement of a provider for real-time threat detection, alerting and immediate, automated remediation service for the entire organization. 8 Table of Contents ● The use of multi-factor authentication for all remote users when they connect to the corporate network and the corporate email platform. ● The deployment of updates and patches as they are available for all installed versions of enterprise software to reduce the exposure to vulnerabilities. ● The review of the security procedures and controls used by third parties that may host or otherwise have access to the Company’s data. ● If necessary, the use of third-party security experts if and when an incident is detected.
Added
Regardless of the controls we have in place, cybersecurity risks continue to become more complex and pervasive, and our internal controls cannot provide absolute assurance that we will be able to protect ourselves from significant cyberattack incidents. Additionally, by outsourcing certain administrative functions to third parties, we may be exposed to risk of data security breaches against those third parties.
Added
We are not aware of any existing cybersecurity threats that would materially affect, or that are reasonably likely to materially affect, our business strategy, results of operations, liquidity or financial conditions. Furthermore, we are not aware of having experienced any significant cybersecurity incidents during fiscal year 2024.
Added
Board Oversight Management periodically updates the Board of Directors regarding efforts to minimize cybersecurity risks. Item 2. PROPERTIES We own our facility located in Roanoke County, Virginia, and the land on which our Roanoke facility is located.
Added
There were no disagreements with our former accountants for the year ended October 31, 2023 or any of the previous fiscal years. The change in the Company’s principal accountants was approved by the Company’s Audit Committee of the Board of Directors. 10 Table of Contents Item 9A. CONTROLS AND PROCEDURES Disclosure Controls and Procedures.
Added
Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time period specified in the rules and forms of the Securities and Exchange Commission (the “SEC”).
Added
Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to management, including the chief executive officer and the chief financial officer, as appropriate to allow timely decisions regarding required disclosure.
Added
Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Therefore, it is not expected that disclosure controls and procedures will prevent all errors or even all instances of fraud.
Added
Notwithstanding the material weakness described herein, management has concluded that the restated and revised audited financial statements included in the Annual Report filed with this report on Form 10-K are fairly stated in all material respects in accordance with U.S. GAAP for each of the periods presented herein.
Added
In connection with the restatement described in Note 20 – Restatement of Previously Issued Financial Statements to the accompanying financial statements included in the Annual Report filed with this report on Form 10-K, management identified a material weakness in internal control over financial reporting related to the classification of an asset or a liability as either long-term or current.
Added
This material weakness resulted in a misclassification of the Company’s Revolver balance as a noncurrent liability instead of a current liability as of October 31, 2023 and for the following interim periods within fiscal year 2024 and 2023: January 31, 2024 and 2023, April 30, 2024 and 2023, and July 31, 2024 and 2023.
Added
To respond to this material weakness, we plan to devote significant effort and resources to the remediation and improvement of internal control over financial reporting as it relates to the classification of assets and liabilities as either long-term or current.
Added
While the Company has processes to identify and appropriately apply applicable accounting requirements, we plan to improve these processes with respect to balance sheet classification issues.
Added
Our plans at this time include developing a checklist to document our review of asset and liability classification as either long-term or current as of the end of each reporting period, with additional focus on the review and interpretation of relevant literature for any significant new agreements or transactions that may impact such classifications during a reporting period, and documenting the performance of both internal and external consultations, if any, related to such matters.
Added
The elements of the remediation plan can only be accomplished over time, and there is no assurance that these initiatives will ultimately have the intended effects.
Added
Restatement of Previously Issued Financial Statements On December 20, 2024, the Company revised its prior position on the classification of the outstanding balance under our Revolver as a noncurrent liability and concluded that the previously issued financial statements for the year ended October 31, 2023 and for the quarters ended January 31, 2024 and 2023, April 30, 2024 and 2023, and July 31, 2024 and 2023 (the “restated periods”) should not be relied on because of a misclassification of balances outstanding on our Revolver as a noncurrent liability instead of a current liability.
Added
The Company has restated the classification of the outstanding balance under our Revolver from a noncurrent liability to a current liability in the financial statements for the restated periods in the Company’s Annual Report for fiscal year 2024 included with this report on Form 10-K (the “Restatement”).
Added
On December 23, 2024, the Company also filed with the SEC a current report on Form 8-K regarding the Restatement. The non-cash, balance sheet only adjustments to the financial statements do not impact the amounts previously reported as total assets, total liabilities or total shareholders’ equity.
Added
Further, the adjustments do not impact previously reported consolidated statements of operations, consolidated statements of shareholders’ equity or consolidated statements of cash flows. There also was no impact on any covenants with lenders as a result of the adjustments, as the Company’s borrowing arrangements do not include financial covenants that would be impacted by the classification of the Revolver balance.
Added
In light of the restatement of our financial statements included in the Annual Report filed with this report on Form 10-K, we plan to improve these processes with respect to balance sheet classification issues.
Added
Our plans at this time include developing a checklist to document our review of asset and liability classification as either long-term or current as of the end of each reporting period, with additional focus on the review and interpretation of relevant literature for any significant new agreements or transactions that may impact such classifications during a reporting period, and documenting the performance of both internal and external consultations, if any, related to such matters.
Added
The elements of our remediation plan can only be accomplished over time, and there is no assurance that these initiatives will ultimately have the intended effects. 12 Table of Contents Item 9B. OTHER INFORMATION None. PART III Item 10.
Added
FURNISHED HEREWITH. 32.2 Certification of the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.