UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

FOR ANNUAL AND TRANSITION REPORTS

PURSUANT TO SECTIONS 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

x       ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended October 31, 20172020

or

¨       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ________________.

Commission File Number 0-13301

RF INDUSTRIES, LTD.

(Name of registrant as specified in its charter)

7610 Miramar Road, Bldg. 6000, San Diego, California 92126-4202

(Address of principal executive offices) (Zip Code)

(858) 549-6340

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, $.01 par value.

Securities registered pursuant to Section 12(g) of the Act:  None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.¨ ☐ Yesx ☒ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.¨ ☐ Yesx ☒ No

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    x☒ Yes  ¨☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   x☒ Yes  ¨☐ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     ¨☐ Yes    x☒ No

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold as of the last business day of the registrant’s most recently completed second fiscal quarter was approximately $9.3$49.4 million.

On January 22, 2018,December 28, 2020, the Registrant had 8,872,2469,848,246 outstanding shares of Common Stock, $.01 par value.

Forward-Looking Statements:

Certain statements in this Annual Report on Form 10-K (this “Annual Report”), and other oral and written statements made by the Company from time to time are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including those that discuss strategies, goals, outlook or other non-historical matters, or projected revenues, income, returns or other financial measures. In some cases forward-looking statements can be identified by terminology such as “may,” “will,” “should,” “except,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms or other comparable terminology. These forward-looking statements are subject to numerous risks and uncertainties that may cause actual results to differ materially from those contained in such statements. Among the most important of these risks and uncertainties are the ability of the Company to continue to source its raw materials and products from its suppliers and manufacturers, particularly those in Asia, the market demand for its products, which market demand is dependent to a large part on the state of the telecommunications industry, the effect of future business acquisitions and dispositions, the incurrence of impairment charges, and competition.

Important factors which may cause actual results to differ materially from the forward-looking statements are described in the Section entitled “Risk Factors” in thethis Form 10-K, and other risks identified from time to time in the Company’s filings with the Securities and Exchange Commission. The Company assumes no obligation to update these forward-looking statements to reflect actual results or changes in factors or assumptions affecting such forward-looking statements.

PART I

General

RF Industries, Ltd. (together with subsidiaries, the “Company”, “we”, “us”, or “our”) is a national manufacturer and marketer of interconnect products and systems, including coaxial and specialty cables and connectors, fiber optic cables and connectors, and electrical and electronic specialty cables and components. Through its fourour manufacturing and production facilities, the Company provideswe provide a wide selection of interconnect products and solutions primarily to telecommunications carriers and equipment manufacturers, wireless and network infrastructure carriers and manufacturers Data Center and Co-location companies, and to various original equipment manufacturers (OEMs)(“OEMs”) in several market segments. Since our acquisition of Schroff Technologies International, Inc. in November 2019, we also manufacture and sell energy-efficient cooling systems and integrated small cell solutions and related components.

The Company operatesWe operate through two reporting segments: (i) the “RFRF Connector and Cable Assembly”Assembly (“RF Connector”) segment, and (ii) the “CustomCustom Cabling Manufacturing and Assembly”Assembly (“Custom Cabling”) segment. The RF Connector and Cable Assembly segment primarily designs, manufactures, markets and distributes a broad range of connector and cable products, including coaxial connectors and cable assemblies that are integrated with coaxial connectors, used in telecommunications and information technology OEM markets and other end markets. The Custom Cabling Manufacturing and Assembly segment designs, manufactures, markets and distributes custom copper and fiber cable assemblies, complex hybrid fiber optic and power solution cables, electromechanical wiring harnesses, data center products, and wiring harnesses for a broad range of applications in a diverse set of end markets.markets, energy-efficient cooling systems for wireless base stations and remote equipment shelters and custom designed, pole-ready 5G small cell integrated enclosures.

Until its saleIn March 2020, the World Health Organization (the “WHO”) declared coronavirus (“COVID-19”) a pandemic emergency. The COVID-19 pandemic has negatively impacted regional and global economies, disrupted global supply chains, and created significant volatility and disruption of financial markets. The global impact of the outbreak has been rapidly evolving and certain jurisdictions, including those where we have operations, have also reacted by instituting quarantines, restrictions on December 22, 2015,travel, “shelter in place” rules, social distancing protocols and restrictions on types of business that may continue to operate. While we have been deemed an “essential” business, and therefore have been permitted to continue our operations, the Company also operatedimpact of the Aviel Electronics Division,COVID-19 pandemic has affected both our operations and those of our customers. Our operations have been negatively affected by changes that we had to make on our operating methods and procedures, and by our reduced workforce capacity allowed inside our facilities. Many of our customers and vendors have likewise had temporary closures of their facilities and have otherwise been impacted by changes in their industries. As a Nevadaresult, overall demand for our products has been reduced and certain costs have increased. We have taken measures to protect the health and safety of our employees, and we continue to work with our customers and vendors to minimize potential disruptions in addressing the challenges posed by this global pandemic.

Recent Transactions

On March 15, 2019, we purchased the business and assets of C Enterprises L.P., a California based division that designed, manufactureddesigner and distributed specialtymanufacturer of quality connectivity solutions to telecommunications and data communications distributors.

On November 4, 2019, we purchased Schroff Technologies International, Inc. (“Schrofftech”), a Rhode Island-based manufacturer and marketer of intelligent thermal control systems used by telecommunications companies across the U.S. and Canada, and shrouds for small cell integration and installation.

Strategy

Our overall strategy is to provide our customers with a broad selection of products, rapid and high-quality service, and custom RF connectors primarilydesign capabilities, all at competitive prices. Specifically, our strategy is the following:

Provide rapid and flexible design and manufacturing services. Over the past few years we have focused our organization on providing a standardized portfolio, allowing for aerospacequick turn readily available products, while having the capabilities, flexible design and military customers. In March 2016,manufacturing services to customize our offering to address customer specific requirements or applications.

Competitive pricing. Our manufacturing and distribution arrangements have been designed to lower costs and enable us to offer prices on both our standard and custom manufactured products that are competitive with the Company commencedmarketplace.

Leverage ourmanufacturing and distribution capabilities and facilities. Our strategy is to operate our five manufacturing and distribution locations to best provide our customers with a competitively priced, high quality product offering delivered with a fast turnaround time. As part of this strategy, we utilize a “one-company” approach to our five production and distribution locations and allocate our resources based on that location’s production specialization capabilities, its proximity to the shutdownshipment destination, and on other factors. Using this “one-company” approach, our goal is to leverage available capacity and shorten delivery times, while potentially providing lower shipping costs. Two of its Bioconnect division, which comprisedour five manufacturing and distribution locations are located in California, while the entire operations of its medical cablingother three are in the Northeast.

Integrate marketing and interconnect operations. The closureselling efforts. Our strategy is to integrate and cross-sell the product lines manufactured at, or distributed by our five facilities. We have been integrating the marketing and sales efforts of the Bioconnectfive divisions, thereby expanding the number and type of products each division was partcan offer to its existing client base.

Broad range of the Company’s planimmediately available connector products. Our strategy is to closestock a large selection of connector parts, including parts for older or dispose of underperforming divisionsdiscontinued products that are not partavailable for immediate delivery. As a result, we are able to fill unique connector orders, as well as provide a broad range of the Company’s core operations.standard connector products.

Operating SegmentsTargeted focus of product lines. Our strategy is to focus on passive products that are integrated into telecommunications, infrastructure and similar products manufactured by others, rather than manufacturing and selling operating components or products. As a result, we no longer manufacture radio modems, no longer provide mobile management solutions and services, and no longer manufacture medical monitoring products. Our product line focus still remains on supporting and leveraging our distribution channels with our core RF Cable & Connectors, Passive DAS, and Quick-Turn Fiber/Copper assemblies offering, while in parallel we continue to expand our portfolio of integrated solutions to address key end customer and market applications.

Increase long-term relationships with customers. Our goal is to establish long-term relationships with the customers who have to date used us for specialized projects by having our solutions built into the customer’s product specifications and bills of materials. As we remain focused on maintaining and expanding our national distributor relationships through our dedicated sales and management teams, we have invested in a targeted business development efforts to assist in getting more closely aligned with the requirements of strategic end customers.

Grow through strategic and targeted acquisitions. We will continue to consider strategic acquisitions of companies or technologies that can increase or diversify our customer base, supplement our management team, expand our product offerings, and/or expand our footprint in a relevant market segment.

Operations

We currently conduct operations through our five divisions with our product areas divided into two reporting segments.

RF Connector and Cable Assembly Segment.

The Company’sOur RF Connector and Cable Assembly segment (“RF Connector segment”) consists of the RF Connector and Cable Assembly division (“RF Connector division”) that is based at the Company’sour headquarters in San Diego, California. Although most of the Company’s RF connector and cable products are inventoried and distributed from its San Diego facilities, some of these products also are inventoried and distributed from some of the Company’s other facilities. The RF Connector and Cable Assembly division is engaged in the design, manufacture and distribution of coaxial connector solutions for companies that design, build, operate, maintain and use wireless voice, data, messaging, and location tracking systems.a variety of connectivity / communication applications. Coaxial connector products consist primarily of connectors which, when attached to a coaxial cable, facilitate the transmission of analog and digital signals in various frequencies.

Although most of the connectors are designed to fit standard cable products, the RF Connector and Cable Assembly division also sells custom connectors specifically designed and manufactured to suit its customers’ requirements such as the Distributed Area Systems (DAS), Wi-Fi and broadband wireless markets. requirements.

The Company’s RF Connector and Cable Assembly division typically carries over 1,500 different types of connectors, adapters, tools, and test and measurements kits. This division’s RF connectors are used in thousands of different devices, products and types of equipment. Since the RF Connector and Cable Assembly division’s standard connectors can be used in a number of different products and devices, the discontinuation of one product typically does not make the Company’sour connectors obsolete. Accordingly, most connectors carried by the Companythat we carry can be marketed for a number of years and are only gradually phased out.years. Furthermore, because the Company’sour connector products are not dependent on any single line of products or any market segment, the Company’sour overall sales of connectors tend to fluctuate less materially when there are material changes or disruption to a single product line or market segment. Sales of the Company’s connector products can, however, be influenced by the infrastructure spend of wireless and telecommunications firms and on the Company’s ability to market its products into these firms and the related ecosystem. The current deployment of wireless through DAS and Small Cells provides the Company with a market opportunity for the use of its connectors and cable assemblies.

Cable assembly products manufactured and sold by the RF Connector and Cable Assembly division consist of various types of coaxial cables that are attached to connectors (usually the Company’sour connectors) for use in a variety of communications applications. Cable assemblies manufactured for the RF Connector and Cable Assembly division are primarily manufactured at the Company’sour San Diego, California facilities using state-of-the-art automation equipment and are sold through distributors or directly to major OEMs. Cable assemblies consistOEM accounts. Our cable assembly portfolio consists of both standard and custom cable assemblies and assemblies that are custom manufactureddesigned for the Company’s clients. The Company offersspecific customer requirements. We offer a line of cable assemblies with over 100,000 cable product combinations. The cable assembly operation was launched in 2000.

The Company designs itsWe design our connectors at itsour headquarters in San Diego, California. However, most of the RF connectors are manufactured for the Companyus by third partythird-party foreign manufacturers located in Asia.

Custom Cabling Manufacturing and Assembly Segment.

The Custom Cabling Manufacturing and Assembly Segmentsegment currently consists of threefour wholly-owned subsidiaries – three located in the Northeastern United States. The three subsidiaries were acquired byU.S and one located in Southern California. C Enterprises, Inc., which the Company acquired in the recent past. EachMarch 2019, and Schrofftech, which was acquired in November 2019, are now part of the three providesCustom Cabling segment. Our plan is to integrate certain aspects of the manufacturing, sales and marketing functions of these divisions so as to better address overlapping market opportunities and to more efficiently manufacture, market, and ship products and solutions to a diverse and distinct customer set from each other and fromour customers.

The four divisions that comprise the RF Connector and Cable Assembly Segment.current Custom Cabling segment consist of the following:

Cables Unlimited, DivisionInc. Cables Unlimited, Inc. (“Cables Unlimited”) is a custom cable manufacturer that RF Industries, Ltd. purchased in 2011. Cables Unlimited’s offices and manufacturing facilities are located in Yaphank, New York.York, that we acquired in 2011. Cables Unlimited is a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products that are backed by Corning Cable Systems' extended warranty. Cables Unlimited designs, develops and manufactures custom connectivity solutions for the industrial, defense, telecommunications and wireless markets.  The products sold by Cables Unlimited include custom and standard copper and fiber optic cable assemblies, adapters and electromechanical wiring harnesses for communications, computer, LAN, automotive fiber optic and medical equipment. In 2012, Cables Unlimited introduced a custom cabling solution known as OptiFlex. The OptiFlex cable is a hybrid power and communications cable primarily designed and built for wireless service providers who are updating their network infrastructure to support current and next generation wireless technologies including 4G and 5G.

Comnet Telecom Supply Division RF Industries, Ltd. purchased Comnet Telecom Supply, Inc. in January 2015. Comnet Telecom’s offices and manufacturing facilities are located in East Brunswick, New Jersey. Formed in 1995, Comnet Telecom is a Corning Cable Systems CAH Connections SM Gold Program member that is authorized to manufacture fiber optic telecommunications products that are backed by Corning Cable Systems' extended warranty and is a Telcordia GR-326 certified manufacturer. Comnet Telecom manufactures and distributes telecommunications equipment and cabling infrastructure products used by telecommunications carriers, co-location service companies, and other telecommunication and data center companies in the U.S. across multiple industries. Comnet Telecom is also a supplier of Hot/Cold Aisle Containment as well as Technology Furnishing Solutions in addition Comnet has developed an offering of data center filler panel containment products.

Rel-Tech Electronics, DivisionInc. RF Industries, Ltd. purchased Rel-Tech Electronics, Inc. (“Rel-Tech”) was acquired in June 2015. Rel-Tech’s offices and manufacturing facilities are located in Milford, Connecticut. Founded in 1986, Rel-Tech is a designer and manufacturer of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation, medical and military customers. Wire and cable assembly products include custom wire harnesses, ribbon cable, electromechanical and kitted assemblies, and networking and communications cabling. DIN and Mini-DIN connector assemblies include power cord, coaxial, Mil-spec, and testing.

Product DescriptionC Enterprises, Inc. C Enterprises, Inc. (“C Enterprises”) is a fiber optic and copper cable manufacturer located in Vista, California. This subsidiary acquired the business and assets of C Enterprises, L.P. on March 15, 2019. C Enterprises is a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products that are backed by Corning Cable Systems’ extended warranty. C Enterprises designs, develops and manufactures connectivity solutions to telecommunications and data communications distributors.

The Company producesSchroff Technologies International, Inc. We acquired Schroff Technologies (“Schrofftech”) in November 2019. Schrofftech is a Rhode Island based manufacturer and marketer of intelligent thermal cooling control systems, along with pole-ready wireless small cell shrouds and enclosures, custom designed for plug-and-play installation. These products are typically used by telecommunications companies across the U.S. and Canada.

Product Description

We produce a broad rangeoffering of interconnect products and assemblies.assemblies used in telecommunications and a range of other industries. The products that are offeredwe offer and sold by the Companysell consist of the following:

Connector and Cable Products

The Company’s RF ConnectorWe design, manufacture and Cable Assembly division designs, manufactures and marketsmarket a broad range of coaxial connectors, coaxial adapters and coaxial cable assemblies for the numerous products with applications in commercial, industrial, automotive, transportation, scientific, aerospace and military markets. Various types of products/connectors are offered including passive DAS related items such as connectors, adapters, splitters, couplers and loads. These connectors are offered in several configurations and cable attachment methods for customer applications.

There are numerous applications for these connectors, some of which include digital applications, 2.5G, 3G, 4G, 5G, LTE, Wi-Fi and other broadband wireless infrastructure, GPS (Global Positioning Systems), mobile radio products, aircraft, video surveillance systems, cable assemblies and test equipment. Users of the Company’sour connectors include telecommunications companies, circuit board manufacturers, OEMs, consumer electronics manufacturers, audio and video product manufacturers and installers, and satellite companies. The Company marketsWe market over 1,500 types of connectors, adapters, tools, assembly, test and measurement kits, which range in price from under $1 to over $1,000 per unit. The kits satisfy a variety of applications including, but not limited to, lab operations, site requirements and adapter needs.

The Company designsWe also design and sellssell a variety of connector tools and hand tools that are assembled into kits used by lab and field technicians, R&Dresearch and development technicians and engineers. The Company also designs and offers some of its own tools, which differ from those offered elsewhere in the market. These tools are manufactured for the Companyus by outside contractors. Tool products are carried as an accommodation to the Company’sour customers and have not materially contributed to the Company’sour revenues.

In addition

We market and manufacture cable assemblies in a variety of sizes and combinations of RF coaxial connectors and coaxial cabling. Cabling is purchased from a variety of major unaffiliated suppliers and is assembled predominately with our connectors as a resultcomplete cable assemblies. Coaxial cable assemblies have numerous applications including low PIM, Wi-Fi and wireless local area networks, wide area networks, internet systems, cellular systems including 2.5G, 3G, 4G, 5G, LTE, DAS and Small Cell installations, TV/dish network systems, test equipment, military/aerospace (mil-standard and COTS (Commercial Off–The-Shelf)) and entertainment systems. Cable assemblies are manufactured to customer requirements.

We carry thousands of the acquisitionseparate types of connectors, most of which are available in standard sizes and configurations and that are also offered by other companies. However, we also have some proprietary products, including the CompPro Product Line,product line, OptiFlex cables, and the Company marketsSchrofftech telecom shelter cooling and manufacturescontrol system products. CompPro is a patented compression technology that offers revolutionary advantages for a water-tight, ruggedized connection, providing easier installation, and improved system reliability on braided cables. CompPro is used by wireless network operators, installers and distributors in North America and other parts of the world.

The Cable Assembly component of OptiFlex is a hybrid fiber optic and DC power cabling solution that we designed and manufactured, and the ConnectorSchrofftech products are energy efficient cooling/temperature control and Cable Assembly division marketsfiltration systems for use in telecom shelters, outdoor enclosures and manufactures cable assemblies in a variety of sizes and combinations of RF coaxial connectors and coax cabling. Cabling is purchased from a variety of major unaffiliated suppliers and is assembled predominately with the Company’s connectors or other brands of connectors as complete cable assemblies. Coaxial cable assemblies have numerous applications including low PIM, wireless and wireless local area networks, wide area networks, internet systems, cellular systems including 2.5G, 3G, 4G, 5G, LTE wireless infrastructure, DAS and Small Cell implementations, TV/dish network systems, test equipment, military/aerospace (mil-standard and COTS (Commercial Off The Shelf)) and entertainment systems. Cable assemblies are manufactured to customer requirements.battery/power rooms.

Cables UnlimitedFiber Optic Products

Cables Unlimited is an International Standards Organization (ISO) approved factory that manufactures custom cable assemblies. Cables Unlimited is also a Corning Cable Systems CAH Connections SM Gold Program member that is authorized to manufacture fiber optic products that are backed by Corning Cable Systems'Systems’ extended warranty. Products manufactured byThrough our Cables Unlimited include custom copper and fiber optic cable assemblies, adapters and electromechanical wiring harnesses for telecommunications, computer, LAN, automotive and medical equipment companies. Cables Unlimited also provides cable installation services in the New York regional area. In April 2012, Cables Unlimited commercially released a cabling solution for wireless service providers engaged in upgrading their cell towers for 4G technologies. The custom hybrid cable, called OptiFlex, is significantly lighter and possesses greater flexibility than cables previously used for wireless service. Most of the products that Cables Unlimited develops and sells are built specifically for its customers’ needs.

The acquisition of Cables Unlimited in 2011 gave the Company the ability todivision, we offer a broad range of interconnect products and systems to the Company’s largest customers. These interconnect systemsthat have the ability to combine radio frequency and fiber optic interconnect components, with various connectors and power cables through customized solutions for these customers. The Company continues to actively market its ability to provide theseCables Unlimited also manufactures OptiFlex, a custom designed hybrid fiber optic interconnectand DC power cabling solution manufactured for wireless service providers engaged in upgrading their cell towers. The custom hybrid cable is significantly lighter and possesses greater flexibility than cables previously used for wireless service.

C Enterprises is a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products that are backed by Corning Cable Systems’ extended warranty. C Enterprises designs, develops and manufactures connectivity solutions to its larger customers.telecommunications and data communications distributors.

Comnet Telecom Other CablingProducts

Comnet Telecom manufacturesWe also design, manufacture and distributes both standard and custom equipment and cabling products used by telecommunications carriers, co-location center operators and other telecommunication and data center companies in the U.S. Such products include fiber optics cable, copper cabling, custom patch cord assemblies, transceivers/converters, data center consoles and other data center equipment (such as server cabinets and network racks). The acquisition of Comnet Telecom expands the Company’s fiber optic cabling capabilities and the customer base to which the Company can sell its other cabling products. The opportunities are further enhanced to sell Comnet data center infrastructure and telecom products into our cable product customer base.

Rel-Tech Electronics Products

Rel-Tech is a designer and manufacturer of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation, medical and military customers. Wire and cable assembly products include custom wire harnesses, ribbon cable, electromechanical and kitted assemblies, networking and communications cabling. DIN and Mini DIN connector assemblies include power cord, coaxial, Mil-spec and testing.

Telecommunications Thermal Control Systems and Shrouds

Since our acquisition of Schrofftech in November 2019, we now also manufacture and sell intelligent thermal control systems for outdoor telecommunications equipment. The thermal control systems, which can be controlled offsite using networked software at the telecommunication company’s own data center, maintain the interior temperature of telecommunications equipment. Schrofftech has also introduced shrouds for small cell deployments that reduce installation time and improve aesthetics by eliminating the exterior cabling used with current configurations.

Foreign Sales

Net sales to foreign customers accounted for $700,000$1,411,000 (or approximately 3%) of our net sales, and $960,000 (or approximately 2%) of the Company’sour net sales and $1.0 million (or approximately 3%) of the Company’s sales, respectively, for the fiscal years ended October 31, 20172020 and 2016.2019, respectively. The majority of the export sales during these periods were to Canada and Mexico.Canada.

The Company doesWe do not own, or directly operate any manufacturing operations or sales offices in foreign countries.

Distribution Marketing and CustomersMarketing

We currently sell our products through independent warehousing distributors and through our in-house marketing and sales team. Sales through independent distributors accounted for approximately 55% of our net sales for the fiscal year ended October 31, 2020. Our agreements with most of the distributors are nonexclusive and generally may be terminated by either party upon 30-60 days’ written notice. The Company deploys various sales methods depending upondirectly sells certain of its products to large, national telecommunication equipment and solution providers who include the market being serviced. The Company currently sellsCompany’s products primarily through warehousing distributors to address the wireless, telecom, and data center markets and direct to OEM customers who utilize coaxial connectors and cable assemblies and harnesses in the manufacture of their own products and solutions.

Backlog

The Company estimates that its backlog of unfulfilled orders as of October 31, 2017 was approximately $4.0 million on a consolidated basis, compared with a backlog of approximately $3.3 million as of October 31, 2016.  The Company does not have any long-term supply agreements, and most of its purchase orders have short lead times. Therefore, backlog may not be indicative of future demand. The Company expects that all or substantially all of the backlog will be filled within the next 12 months.product offerings.

Manufacturing

The RF Connector and Cable Assembly division contractsWe contract with outside third parties for the manufacture of a significant portion of itsour coaxial connectors. However, virtually all of the RF cable assemblies sold by the RF Connector and Cable Assembly division during the fiscal year ended October 31, 20172020 were assembled by the Cable Assembly side of the RF Connector and Cable Assembly division at the Company’sInternational Organization for Standardization (ISO) approved ISO factory in San Diego, California. The RF Connector and Cable Assembly division procures itsWe procure our raw cable from manufacturers with ISO approved factories in the United States, China and Taiwan. The Company is dependent primarily relies on twelve manufacturersseveral third-party partners for the manufacture of its coaxial connectors, tools and other passive components and several plants for raw cable.receives bulk cable from multiple manufacturing plants. Although the Company doeswe do not have manufacturing agreementscontracts with these manufacturers for itsour connectors and cable products, the Company doeswe do have long-term purchasing relationships with these manufacturers.relationships. There are certain risks associated with the Company’sour dependence on third-party manufacturers for some of itsour products. See “Risk Factors” below. The Company hasWe have in-house design engineers who create the engineering drawings for fabrication and assembly of connectors and cable assemblies. Accordingly, the manufacturers are not primarily responsible for design work related to the manufacture of the connectors and cable assemblies.

Cables Unlimited manufactures its

We manufacture custom cable assemblies, adapters and electromechanical wiring harnesses and other products inthrough Cables Unlimited at its Yaphank, New York manufacturing facility. Cables UnlimitedThe Yaphank facility is an ISO approved factory, as well asfactory. Cables Unlimited is a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products and assemblies that are backed by Corning Cable Systems' extended warranty. Cables Unlimited outsources the assembly of a portion of its proprietary OptiFlex cable to a third party manufacturer. The final assembly and termination of the OptiFlex cable is completed by Cables Unlimited at its Yaphank, New York facilities.

Comnet Telecom manufactures, assembles and tests its cabling products at its facilities in East Brunswick, New Jersey. Comnet TelecomThe Milford, Connecticut facility of Rel-Tech is a Corning Cable Systems CAH Connections SM Gold Programan ISO approved fiber optic member and a Telcordia GR-326 approved manufacturer also authorizedmanufacturing facility that is primarily used to produce fiber optic products and assemblies that are backed by Corning Cable Systems' extended warranty.

Rel-Tech Electronics manufactures itsmanufacture cable assemblies, electromechanical assemblies, wiring harnesses and other products in its Milford, Connecticut,similar products. 

The Vista, California facility operated by C Enterprises is an ISO approved manufacturing facility. facility that is primarily used to manufacture fiber optic and copper cable assemblies that are backed by Corning Cable Systems’ extended warranty.

The products sold by Schrofftech are designed and manufactured at its ISO approved manufacturing facility in North Kingstown, Rhode Island. Schrofftech’s products are manufactured and tested in accordance with the ETL Listing standards.

Raw Materials

Connector materials are typically made of commodity metals such as copper, brass and zinc and include small applications of precious materials, including silver and gold. The RF Connector and Cable division purchases most of its connector products from contract manufacturers located in Asia and the United States. The Company believesWe believe that the raw materials used in itsour products are readily available and that the Company iswe are not currently dependent on any supplier for itsour raw materials. The Company doesWe do not currently have any long-term purchase or supply agreements with itsour connector or suppliers. The Cable Assembly group obtainsCustom Cabling divisions obtain coaxial connectors from the RF Connector group. The Company believesdivision. We believe there are numerous domestic and international suppliers of other coaxial connectors.connectors that we may need for any of our cabling products.

The Cables Unlimited, division, Comnet Telecom divisionRel-Tech, C Enterprises, and the Rel-Tech Electronics divisionSchrofftech divisions purchase largely all of the raw materials used in their products from manufacturerssources located in the United States. Fiber optic cables are available from various manufacturers located throughout the United States; however, both Cables Unlimited and Comnet Telecom purchasepurchases most of theirits fiber optic cables from Corning Cables Systems LLC. The Company believes that the raw materials used by Cables Unlimited and Comnet Telecom in theirits products are readily available and that neither divisionCables Unlimited is not currently dependent on any supplier for its raw materials except where Corning Extended Warranty certification is required. Neither Cables Unlimited nor Comnet Telecom nor Rel-Tech Electronics currently have any long-term purchase or supply agreements with their connector and cable suppliers.

Employees

As of October 31, 2017, the Company2020, we employed 195271 full-time employees, of whom 4354 were in accounting, administration, sales and management, 146210 were in manufacturing, distribution and assembly, and 6seven were engineers engaged in design, engineering and research and development. The employees were based at the Company’s officesour facilities in San Diego, California (64(81 employees), Yaphank, New York (35(51 employees), Milford, Connecticut (66(48 employees), Vista, California (79 employees), and East Brunswick, New Jersey (30North Kingstown, Rhode Island (12 employees). The CompanyWe also occasionally hireshire part-time employees. The Company believesWe believe that it haswe have a good relationship with itsour employees. The Cables Unlimited division employs five cable installers who are currently represented by a union. Other than the foregoing installers that belong to a union, none of the Company’s other employees are unionized.

Research and Development

The Company’s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively. Research and development costs are expensed as incurred.

Patents, Trademarks and Licenses

The Company owns 14We own ten U.S. patents (ten U. S. and four foreign) and there are two foreign patents pending approval related to CompPro Product Line that itwe acquired in May 2015. The CompPro Product Line utilizes a patented compression technology that offers revolutionary advantages for a water-tight connection, easier installation, and improved system reliability on braided cables. The CompPro Product Line is used by wireless network operators, installers and distributors in North America and other parts of the world.

Our Schrofftech subsidiary owns five issued patents on its proprietary telecom shelter cooling and control system technology and its equipment room ventilation controls. Schrofftech has also filed four pending patent applications related to ventilation and control equipment and controls.

The Company also ownstrademarks we own include the “CompPro” registered trademark associated with the compression cable product line.

The Company usesline and the “OptiFlex™” as a trademark for its hybrid cable wireless tower cable solution. Each of our subsidiaries also use various trademarks (and associated logos and trade names) in their operations, although none of these trademarks have been registered.

Because the CompanyRF Connectors division carries thousands of separate types of connectors and other products, most of which are available in standard sizes and configurationconfigurations and are also offered by the Company’sour competitors, the Company doeswe do not believe that itsour cables and connector business or competitive position is dependent on patent protection.

Under its agreements with Corning Cables Systems LLC, Cables Unlimited and Comnet TelecomC Enterprises are permitted to advertise that they are Corning Cables System CAH Connections SM Gold Program members.

Warranties and Terms

The Company warrants itsWe warrant our products to be free from defects in material and workmanship for varying warranty periods, depending upon the product. Products are generally warranted to the dealer for one year, with the dealer responsible for any additional warranty it may make. The RF Connector products are warranted for the useful life of the connectors. Although the Company haswe have not experienced any significant warranty claims to date, there can be no assurance that it will not be subjected to such claims in the future.

The CompanyWe usually sellssell to customers on 30-day terms pursuant to invoices and doesdo not generally grant extended payment terms. Sales to most foreign customers are made on cash terms at time of shipment. Customers may delay, cancel, reduce, or return products after shipment subject to a restocking charge.

Under its agreements with Corning Cables Systems LLC, Cables Unlimited and Comnet TelecomC Enterprises are authorized to manufacture optic cable assemblies that are backed by Corning Cables Systems’ extended warranty (referred to as the “Gold Certified Warranty”).

Competition

The Companyindustries in which we operate are highly competitive, and industry analysts estimate worldwide saleswe compete with thousands of connector productscompanies that range from large multinational corporations, some of approximately $59 billion in 2017. The Company believes that the worldwide industry for connector productswhich have greater assets and financial resources, to local manufacturers. Competition is highly fragmented, with no one competitor having over a 20% sharegenerally based on breadth of the total market. The Companyproduct offering, product innovation, price, quality, delivery, performance and industry analysts estimate worldwide sales of cable assembly products totaled nearly $140 billion in 2016.customer service. In North America, there are an estimated 1,105 companies participatingaddition, rapid technological changes occurring in the cable assembly business with approximately 23%communications industry could also lead to the entry of the companies serving the industrial market sector. Many of thenew competitors of all sizes against whom we may not be able to successfully compete.  There can be no assurance that we will be able to compete successfully against existing or new competition, and the RF Connectorinability to do so may result in price reductions, reduced margins, or loss of market share, any of which could have an adverse effect on our business, financial condition and Cable Assembly division have significantly greater financial resources and broader product lines. The RF Connector and Cable Assembly division competes on the basisresults of product quality, product availability, price, service, delivery time and value-added support to its distributors and OEM customers. Since the Company’s strategy is to provide a broad selection of products in the areas in which it competes and to have a ready supply of those products available at all times, the Company normally carries a significant amount of inventory of its connector products.operations.

Cables Unlimited competes on the basis of product quality, custom design, service, delivery time and value-added support to its customers. Since Cables Unlimited and Comnet Telecom are Corning Cables System CAH Connections Gold Program members, along with 13 companies permitted to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems’ extended warranty. Cables Unlimited and Comnet Telecom believes that being part of a limited number of Corning Cables System CAH Connections Gold Program members provides a competitive advantage in certain fiber optic markets.

Cables Unlimited, Comnet Telecom and Rel-Tech Electronics compete with both smaller, local cable assembly houses as well as large, national manufacturers and distributors of telecommunications equipment and products.

Government Regulations

The Company’sOur products are designed to meet all known existing or proposed governmental regulations. Management believesWe believe that the Companywe currently meetsmeet existing standards for approvals by government regulatory agencies for itsour principal products.

The Company’sOur products are Restriction on Hazardous Substances (“RoHS”) compliant.

Investor Information.

The Company’sOur principal executive office is currently located at 7610 Miramar Road, Building #6000, San Diego, California. The CompanyRF Industries, Ltd. was incorporated in the State of Nevada on November 1, 1979, completed its initial public offering in March 1984 under the name Celltronics, Inc., and changed its name to RF Industries, Ltd. in November 1990. Unless the context requires otherwise, references to the “Company” in this report include RF Industries, Ltd. and its threefour wholly-owned subsidiaries, Cables Unlimited, Inc., Comnet Telecom Supply,Rel-Tech Electronics, Inc., C Enterprises, Inc., and Rel-Tech Electronics,Schroff Technologies International, Inc.

The Company’s principal Internet website is located athttp://www.rfindustries.com. The Company’s annual reports, quarterly reports, current reports on Form 8-K and amendments to such reports filed or furnished pursuant to sectionSection 13(a) or 15(d) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), and other information related to the Company, are available, free of charge, on that website as soon as we electronically file those documents with, or otherwise furnish them to, the Securities and Exchange Commission (“SEC”). Reports filed with the SEC are also available on the SEC’s website at www.sec.gov. The Company’s Internet website and the information contained therein, or connected thereto, are not and are not intended to be incorporated into this Annual Report on Form 10-K.Report.

Investors should carefully consider the risks described below and all other information in this Form 10-K. The risks and uncertainties described below are not the only ones facing the Company.us. Additional risks and uncertainties not presently known to the Companyus or that itwe currently deemsdeem immaterial may also impair the Company’sour business and operations.

If any of the following risks actually occur, the Company’sour business, financial condition or results of operations could be materially adversely affected. In such case, the trading price of the Company’sour common stock could decline and investors may lose all or part of the money they paid to buy the Company’stheir investment in our common stock.

We The Company Is Heavily Dependent Upon Wireless And Broadband Communications Providers.are heavily dependent upon wireless and broadband communications providers.

TheMost of our revenues and profitability of the Company are,have in recent years been generated from products that we sell, directly or through our distributors, to a significant extent, dependent upon the wireless and broadband communications industries. Accordingly, revenuesIn addition, we also sell connectors, cables and profits have decreased during the past two years asother products to companies that incorporate these markets have experienced an industry-wide slowdown in growth. The Company’s operations are expected in the future to continue to beproducts into their own wireless and broadband communications products. As a result, our business is heavily dependent upon the wireless and broadband industries.markets.  Demand for our products in these markets depends primarily on capital spending by operators for constructing, rebuilding or upgrading their telecommunication systems. The Company acquired Comnet Telecom in January 2015amount of this capital spending and, Rel-Tech Electronics in June 2015 in parttherefore, our sales and profitability, will be affected by a variety of factors affecting the telecommunications companies, including general economic conditions, consolidation within the telecommunications industry and the financial condition of operators. Although we sell many products into many different markets other than the telecommunications marketplace, because a major portion of our revenues has historically been derived from direct and indirect sales to reduce the Company’s dependence on the wireless and broadband customerscommunications companies, our financial condition and to provide other communications products thatresults of operations are not as dependent uponheavily influenced by the wirelesshealth and broadband markets. However, because the Company anticipates that sales togrowth of the wireless and broadband markets, willall of which is beyond our control.

The COVID-19 public health pandemic is adversely affecting, and is expected to continue to represent a large portionadversely affect, certain aspects of our business.

The COVID-19 pandemic, and the reactions of governmental and other authorities to contain, mitigate or combat the pandemic, which have severely restricted the level of economic activity around the world, have impacted, and are expected to continue to impact, our operations, and the nature, extent and duration of the Company’s revenues,impact of the Company’s revenuesCOVID-19 pandemic or any future disease or adverse health condition is highly uncertain and profitsbeyond our control. In response to the COVID-19 pandemic, Federal, state and local governmental agencies have taken and may again take preventative or protective actions, such as imposing restrictions on travel and business operations. The COVID-19 pandemic, and the government’s reaction to the pandemic have significantly slowed capital expenditures in the primary markets for our products, which has resulted in a significant reduction in demand for our products.

Although we have implemented measures to mitigate the impact of the COVID-19 pandemic on our business, financial condition and results of operations, including reducing our expenses in certain areas of our business, these measures will not fully mitigate the adverse impact of the COVID-19 pandemic on our business, financial condition and results of operations. We cannot predict the degree to, or the period over, which we will be affected by the COVID-19 pandemic and resulting governmental and other measures. However, we expect that the economic effects of the COVID-19 pandemic may continue to be heavily dependent onadversely affect demand for certain of our products for the wireless and broadband markets.foreseeable future.

We The Company Depends On Third-Party Contract Manufacturers For A Majority Of Its Connector Manufacturing Needs.depend on third-party contract manufacturers for amajority of our connector manufacturing needs. If They Are Unable To Manufacture A Sufficient Quantity Of High-Quality Products On A Timely And Cost-Efficient Basis, The Company’s Net Revenue And Profitability Would Be Harmed And Its Reputation May Suffer.they are unable to manufacture asufficient quantity of high-quality products on atimely and cost-efficient basis, our net revenue and profitability would be harmed and our reputation may suffer.

Substantially all of the Company’s RF Connector and Cable Division’sdivision’s connector products are manufactured by third-party contract manufacturers. The Company reliesWe rely on them to procure components for RF Connectorsconnectors and in certain cases to design, assemble and test itsthe products on a timely and cost-efficient basis. If the Company’sour contract manufacturers are unable to complete design work on a timely basis, the Companywe will experience delays in product development and itsour ability to compete may be harmed. In addition, because some of the Company’sour manufacturers have manufacturing facilities in Taiwan and China, their ability to provide the Companyus with adequate supplies of high-quality products on a timely and cost-efficient basis is subject to a number of additional risks and uncertainties, including political, social and economic instability and factors that could impact the shipment of supplies. If the Company’sour manufacturers are unable to provide itus with adequate supplies of high-quality products on a timely and cost-efficient basis, the Company’sour operations would be disrupted and itsour net revenue and profitability would suffer. Moreover, if the Company’sour third-party contract manufacturers cannot consistently produce high-quality products that are free of defects, the Companywe may experience a higher rate of product returns, which would also reduce itsour profitability and may harm the Company’sour reputation and brand.

The Company doesWe do not currently have any long-term supply agreements with any of itsour contract manufacturers, and such manufacturers could stop manufacturing products for the Companyus at any time. Although the Company believeswe believe that itwe could locate alternate contract manufacturers if any of its manufacturers terminated theirour business, the Company’sour operations could be impacted until alternate manufacturers are found.

Our The Company’s Prior Acquisitions And Potential Additional Future Acquisitions Could Increase Operating Costs And Expose The Company To Additional Risks.prior acquisitions and potential additional future acquisitions could increase operating costs and expose us to additional risks.

As part of itsour plan to operate businesses that are profitable and that reflect the changing market, the Companywe from time to time sellssell unprofitable divisions and purchasespurchase new businesses. DuringSuch recent transactions include the past few years,purchase of our new C Enterprises and Schrofftech subsidiaries in 2019. In addition, we have previously disclosed that, as part of our growth strategy, we intend to make additional acquisitions of businesses in the Company has sold its Aviel, RadioMobile and RF Neulink divisions, and has shutdown its Bioconnect division. The Company has also purchased the Cables Unlimited, Comnet Telecom, and Rel-Tech subsidiaries.future. While the Company believeswe believe that restructuring itsour operations to address changes in its principal marketsand acquiring other businesses will benefit the Companyus in the longer term, these dispositions and acquisitions have in the short term caused the Companyus to incur additional legal, accounting and administrative expenses, including the cost of integrating the various accounting systems of itsour new subsidiaries, upgrading itsour information systems, and the cost of managing various divisions in separate locations and states. The CompanyWe may in the future make additional acquisitions. Accordingly, the Companywe will be subject to numerous risks associated with the acquisition of additional businesses, including:

Any of these risks could materially harm the Company’sour business, financial condition and results of operations. There can be no assurance that any business that the Company acquireswe acquire will achieve anticipated revenues or operating results.

Our The Company’s Dependence On Third-Party Manufacturers Increases The Risk That It Will Not Have An Adequate Supply Of Products Or That Its Product Costs Will Be Higher Than Expected.dependence on third-party manufacturers increases the risk that we will not have an adequate supply of products or that our product costs will be higher than expected.

The risks associated with the Company’sour dependence upon third parties which develop and manufacture and assemble the Company’s products, include:

These risks may lead to increased costs or delay product delivery, which would harm the Company’sour profitability and customer relationships.

An impairment in the carrying value of goodwill, tradenames and other long-lived assets could negatively affect the Company’s consolidated results of operations and net worth.impairment in the carrying value of goodwill, tradenames and other long-lived assets could negatively affect ourconsolidated results of operations and net worth.

Goodwill and indefinite-lived intangible assets, such as trade names, are recorded at fair value at the time of acquisition and are not amortized, but are reviewed for impairment annually or more frequently if impairment indicators arise. In evaluating the potential for impairment of goodwill and trade names, we make assumptions regarding future operating performance, business trends and market and economic conditions. There are inherent uncertainties related to these factors and in applying these factors to the assessment of goodwill and trade name recoverability. Goodwill reviews are prepared using estimates of fair value based on the estimated present value of future discounted cash flows. The CompanyWe could be required to evaluate the recoverability of goodwill or tradenamestrade names prior to the annual assessment upon unexpected significant declines in operating results, the divestiture of a significant component of the Company’sour business or other factors.

The Company has determined as of October 31, 2017 that the goodwill of Cables Unlimited, Inc., Comnet, Rel-Tech and CompPro have not been impaired.

However, in the fourth quarter of the fiscal year ended October 31, 2016, the Company recognized $2.6 million and $150,000 of impairment charges on goodwill and tradename, respectively, related to its Cables Unlimited, Inc. subsidiary.

No assurance can be given that events or circumstances will not change regarding the carrying value of goodwill of the Cables Unlimited, ComnetRel-Tech, C-Enterprises and Rel-TechSchrofftech subsidiaries or the CompPro product line. Should the Companywe in the future determine that the carrying value of the goodwill associated with some or all of these assets no longer is recoverable, the Companywe will have to record additional impairment losses. In the event that the Company doeswe have to record material impairment charges on either of the Cables Unlimited, Comnet and Rel-Tech, C-Enterprises or Schrofftech subsidiaries or the CompPro product line, such future charges could materially reduce future earnings, which would negatively affect the Company’sour stock price.

Changes If The Manufacturers Of The Company’s Coaxial Connectors Or Other Products Discontinue The Manufacturing Processes Needed To Meet The Company’s Demands Or Fail To Upgrade Their Technologies, The Company May Face Production Delays.in technology may reduce the demand for some of ourproducts.

The Company’swireless and telecommunications industry is rapidly changing. Changes in the product demands by telecommunications and other infrastructure companies may make certain of our current products obsolete. Accordingly, we must timely react to technological developments and provide new products to meet the shifting demands of its customers. Our failure to successfully introduce new or enhanced products on a timely and cost-competitive basis could have a material adverse effect on the results of our operations and financial condition.

If the manufacturers of ourcoaxial connectors or other products discontinue the manufacturing processes needed to meet our demands or fail to upgrade their technologies, we may face production delays.

Our coaxial connector and other product requirements typically represent a small portion of the total production of the third-party manufacturers. As a result, the Company iswe are subject to the risk that a third-party manufacturer will cease production of some of the Company’sour products or fail to continue to advance the process design technologies on which the manufacturing of the Company’sour products are based. Each of these events could increase the Company’sour costs, harm itsour ability to deliver products on time, or develop new products.

Our While The Company Has In The Past Paid Dividends, No Assurance Can Be Given That The Company Will Declare Or Pay Cash Dividends In The Future.dependence upon independent distributors to sell and market our products exposes us to the risk that such distributors may decrease their sales of our products or terminate their relationship with us.

During fiscal 2017, the Company made four dividends distributions to its stockholders (for a total of $0.08 per share). Dividends are declared and paid at the discretion of the Board of Directors subject to applicable laws, and depend on a number of factors, including our financial condition, results of operations, capital requirements, plans for future acquisitions, contractual restrictions, general business conditions and other factors that our Board of Directors may deem relevant. If the Company does not pay a cash dividend, the Company’s stockholders will not realize a return on their investment in the Common Stock except to the extent of any appreciation in the value of the Common Stock. 

The Company’s Dependence Upon Independent Distributors To Sell And Market The Company’s Products Exposes The Company To The Risk That Such Distributors May Decrease Their Sales Of The Company’s Products Or Terminate Their Relationship With The Company.

The Company’sOur sales efforts are primarily affected through independent distributors. Although the Company haswe have entered into written agreements with most of the distributors, the agreements are nonexclusive and generally may be terminated by either party upon 30-60 days’ written notice. The Company’sOur distributors are not within theour control, of the Company, are not obligated to purchase products from the Company,us, and may also sell other lines of products. There can be no assurance that these distributors will continue their current relationships with the Companyus or that they will not give higher priority to the sale of other products, which could include products of competitors. A reduction in sales efforts or discontinuance of sales of the Company’sour products by itsour distributors would lead to reduced sales and could materially adversely affect the Company’sour financial condition, results of operations and business. Selling through indirect channels such as distributors may limit the Company’sour contact with itsour ultimate customers and the Company’sour ability to assure customer satisfaction.

A Portion Of The Company’s Sales Is Dependent Upon A Few Principal Customers, The Loss Of Whom Could Materially Negatively Affect The Company’s Total Sales.material portion of oursales is dependent upon afew principal customers, the loss of whom could materially negatively affect our total sales.

Two customers, both distributors, accounted for approximately 20%14% and 11%12% of the Company’sour net sales for the fiscal year ended October 31, 2017, and one customer2020. These two distributors each had accounts receivable balances that accounted for approximately 15%12% of the Company’stotal net sales foraccounts receivable balance at October 31, 2020. For the fiscal year ended October 31, 2016. Although2019, one of these distributors and a wireless carrier accounted for approximately 19% and 23%, respectively, of our net sales. The wireless carrier’s accounts receivable balance accounted for approximately 56% of the total net accounts receivable balance at October 31, 2019. None of these customers have been on-going major customers of the Company continuously in the past, theentered into long-term written agreements with these customersus, nor do notthey have any minimum purchase obligations and theobligations. Accordingly, these customers could stop buying the Company’sour products at any time and for any reason. Also, from time to time we also sell products directly to a few larger end-users for use in upgrading and building out their wireless network infrastructure. A reduction, delay or cancellation of orders from these customers or the loss of theseour major distributors or any of our primary end-user customers could significantly reduce the Company’s futureour revenues and profits. The CompanyWe cannot provide assurance that this customerour existing distributors or any of its currentprimary end-user customers will continue to place orders, that orders by existing customers will continue at current or historical levels or that the Company will be able to obtain orders from new customers.use us as a primary source of their product requirements.

Difficult Conditions In The Global Economy May Adversely Affected the Company’s Business And Results Of Operations.conditions in the global economy may adversely affected ourbusiness and results of operations.

A prolonged economic downturn, both in the U.S. and worldwide, could lead to lower sales or reduced sales growth, reduced prices, lower gross margins, and increased bad debt risks, all of which could adversely affect the Company’sour results of operations, financial condition and cash flows. Slowing economic activity, particularly in the telecommunication and data communication and wireless communications industries that represent the Company’sour largest target market, may adversely impact the demand for the Company’sour products. If the current economic condition in the U.S. deteriorates, the Company’sour results could be adversely affected as demand for wireless products lessens. There could also be a number of other adverse follow-on effects on the Company’sour business from a deterioration of economic conditions or from a credit crisis, including insolvency of certain key distributors, key suppliers, contract manufacturers and customers.

Because The Markets In Which The Company Competes Are Highly Competitive, A Failure To Effectively Compete Could Result In An Immediate And Substantial Loss Of Market Share.the markets in which wecompete are highly competitive, afailure to effectively compete could result in an immediate and substantial loss of market share.

The markets in which the Company operateswe operate are highly competitive and the Company expectswe expect that competition will increase in these markets. In particular, the wireless and telecommunications markets in which most of the Company’sour products are sold are intensely competitive. A failure to effectively compete in this market could result in an immediate and substantial loss of revenues and market share. Because most of the Company’sour sales are derived from products that are not proprietary or that can be used to distinguish the Companyus from itsour competitors, the Company’sour ability to compete successfully in these markets depends on a number of factors, including:

The Company’sOur revenues may suffer if the Company iswe are not able to effectively satisfy itsour customers in each of the foregoing ways. In addition, the Company’sour competitors or customers may offer enhancements to its existing products or offer new products based on new technologies, industry standards or customer requirements that have the potential to replace or provide lower-cost or higher performance alternatives to the Company’sour products. The introduction of enhancements or new products by the Company’sour competitors could render itsour existing and future products obsolete or unmarketable.

Many of the Company’sour competitors have significantly greater financial and other resources. In certain circumstances, the Company’sour customers or potential customers have internal manufacturing capabilities with which the Companywe may compete.

If The Industries Into Which The Company Sells Its Products Experience Recession Or Other Cyclical Effects Impacting The Budgets Of Its Customers, The Company’s Operating Results Could Be Negatively Impacted.the industries into which wesell our products experience recession or other cyclical effects impacting the budgets of our customers, our operating results could be negatively impacted.

The primary customers for the Company’sour connector and cable products are in the wireless communications industries. Any significant downturn in the Company’sour customers’ markets, in particular, or in general economic conditions which result in the cut back of budgets would likely result in a reduction in demand for the Company’sour products and services and could harm the Company’sour business. Historically, the communications industry has been cyclical, affected by both economic conditions and industry-specific cycles. Depressed general economic conditions and cyclical downturns in the communications industry have each had an adverse effect on sales of communications equipment, OEMs and their suppliers, including the Company.us. No assurance can be given that the wireless communications industry will not experience a material downturn in the near future. Any cyclical downturn in the communications industry could have a material adverse effect on the Company.us.

Because The Company Sells Its Products To Foreign Customers, The Company Is Exposed To All Of The Risks Associated With International Sales, Including Foreign Currency Exposure.we sell our products to foreign customers, we are exposed to all of the risks associated with international sales, including foreign currency exposure.

Sales to customers located outside the United States, either directly or through U.S. and foreign distributors, accounted for approximately 3% and 2% and 3% of theour net sales of the Company during the years ended October 31, 20172020 and 2016,2019, respectively. International revenues are subject to a number of risks, including:

The Company’sOur foreign sales are also affected by general economic conditions in its international markets. A prolonged economic downturn in itsour foreign markets could have a material adverse effect on the Company’sour business. There can be no assurance that the factors described above will not have an adverse material effect on the Company’sour future international revenues and, consequently, on theour financial condition, results of operations and business of the Company.business.

Since sales made to foreign customers or foreign distributors have historically been in U.S. dollars, the Company haswe have not been exposed to the risks of foreign currency fluctuations. However, if the Companywe in the future isare required to accept sales denominated in the currencies of the countries where sales are made, the Companywe will thereafter also be exposed to currency fluctuation risks.

Changes Of Key Personnel Could Adversely Affect The Company’s Operations.inability to hire or retain certain key professionals, management and staff could adversely affect our business, financial condition and results of operations.

The Company’sOur future success is dependent to a significant extent ondepends largely upon the continued service of our executive officers and other key management and technical personnel, and on our ability to continue to identify, attract, retain and motivate them. However, other than the employment agreement entered into with Mr. Dawson, the Company’s senior executives. On July 17, 2017, the Company hired Robert D. Dawson as President and Chief Executive Officer. Howard Hill, the Company’s interim President and Chief Executive Officer, remainedwe currently do not have any other written employment agreements with the Company as a member of its Board of Director.our executive officers and managers. The Company believes that Mr. Dawson’s experience as well as his knowledge of the wireless market for employees in our industry is highly valuable to the Company. In addition, the Company’s operations are dependent upon the continued services of Mark Turfler, its Chief Financial Officer,extremely competitive and the presidentscost for new employees may exceed the cost of the Company’s four divisions.existing employees. The loss of the serviceskey management and technical personnel, could have an adverse effect on our business, financial position and results of these officers could materially adversely affect the Company’s business, operating results, and financial condition. The Company has an employment agreement in place for Mr. Dawson and no other officers.operations.

We The Company Has Few Patent Rights In The Technology Employed In Its Products, Which May Limit the Company’s Ability To Compete.have few patent rights in the technology employed in our products, which may limit our ability to compete.

Other than the patents that the Company ownswe own related to itsthe CompPro proprietary product line and the Company doesSchrofftech telecom shelter cooling products and control systems, we do not hold any other United States or foreign patents, and does not have any patents pending. The Company doespatents. Since we do not seek to protect itsour rights in the technology that it developswe develop or that the Company’sour third-party contract manufacturers develop for us by means of the patent laws, although it does protect some aspects of its proprietary products and technologies by means of copyright and trade secret laws. Accordingly, competitors can and do sell manymost of the same products as the Company,us, and the Companywe cannot prevent or restrict such competition.

Volatility of Trading Prices Of The Company’s Stock Could Result In A Loss On An Investment In The Company’s Stock.trading prices of our stock could result in aloss on an investment in our stock.

The market price of the Company’sour common stock has varied greatly, and the trading volume of the Company’sour common stock has fluctuated greatly as well. These fluctuations often occur independently of the Company’sour performance or any announcements by the Company.of our announcements. Factors that may result in such fluctuations include:

In addition, the stock market may, from time to time, experience extreme price and volume fluctuations, which may be unrelated to the operating performance of any specific company. Accordingly, the market prices of the Company’sour common stock may be expected to experience significant fluctuations in the future.

Failure to maintain an effective system of internal control over financial reporting or to remediate weaknesses could materially harm the Company’s revenues, erode stockholder confidence in the Company's ability to pursue business and report its financial results/condition, and negatively affect the trading price of the Company’s common stock.to maintain an effective system of internal control over financial reporting or to remediate weaknesses could materially harm our revenues, erode stockholder confidence in our ability to pursue business and report our financial results/condition, and negatively affect the trading price of our common stock.

As a public reporting company, the Company iswe are required to establish and maintain effective internal control over financial reporting. Failure to establish such internal control, or any failure of such internal control once established, could adversely impact the Company’sour public disclosures regarding itsour business, financial condition or results of operations. Any failure of our internal control over financial reporting could also prevent the Companyus from maintaining accurate accounting records and discovering accounting errors and financial frauds.

Rules adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 require annual assessment of our internal control over financial reporting. The standards that must be met for management to assess the internal control over financial reporting as effective are complex, and require significant documentation, testing and possible remediation to meet the detailed standards. Management’sAny assessment by management that there are weaknesses in the Company’sour internal control over financial reporting may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in the internal controls over financial reporting (including those weaknesses identified in periodic reports), or disclosure of management’s assessment of the internal controls over financial reporting may have an adverse impact on the price of the Company’sour common stock.

As disclosed in Form 10-K for the year endedof October 31, 2016,2020 and 2019, we identified a material weakness in our internal controls specifically in connection with the untimely review of the impairment analysis for goodwill prepared by third party subject matter experts. We determined that the Company did not have adequate design or operation of internal controls to ensure the timely review of its accounting for certain complex estimates. While we believe that we have remediated the foregoing material weakness and that our internal controls were effective as of October 31, 2017,control over financial reporting was effective. However, no assurance can be given that there will not be other failures in our internal controls.controls in future periods.

A Cyber Incident Could Result In Information Theft, Data Corruption, Operational Disruption, And/ Or Financial Loss.cyber incident could result in information theft, data corruption, operational disruption, and/or financial loss.

Businesses have become increasingly dependent on digital technologies to conduct day-to-day operations. Additionally, we may be exposed to increased cyber security risks as a result of remote working requirements imposed on us as a result of the COVID-19 pandemic. At the same time, cyber incidents, including deliberate attacks or unintentional events, have increased. A cyber attack could include gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption or result in denial of service on websites. We depend on digital technology, including information systems and related infrastructure, to process and record financial and operating data, and communicate with ourits employees and business partners. Our technologies, systems, networks, and those of ourits business partners may become the target of cyber attacks or information security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of proprietary and other information, or other disruption of our business operations. Although to date we have not experienced any losses relating to cyber attacks, there can be no assurance that we will not suffer such losses in the future. As cyber threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance ourits protective measures or to investigate and remediate any information security vulnerabilities.

While wehave in the past paid dividends, no assurance can be given that we will declare or pay cash dividends in the future.

During fiscal 2020, we made two dividends distributions to our stockholders (for a total of $0.04 per share), but thereafter stopped paying dividends because of the decrease in revenues and profitability and the uncertainty associated with COVID-19. Dividends are declared and paid at the discretion of the Board of Directors subject to applicable laws, and depend on a number of factors, including our financial condition, results of operations, capital requirements, plans for future acquisitions, contractual restrictions, general business conditions and other factors that our Board of Directors may deem relevant. Therefore, even if our operations return to their prior level of profitability, any decision to pay dividends in the future will depend on various other factors that the Board may consider relevant. Accordingly, no assurance can be given that we will once again pay regular dividends in the future. If we do not pay a cash dividend, our stockholders will not realize a return on their investment in the common stock except to the extent of any appreciation in the value of the common stock. 

NoneNot applicable.

The CompanyWe currently leases itslease our corporate headquarters and RF connector and cable assembly manufacturing facilities at 7610 Miramar Road,in San Diego, California. At that location, the Company leaseswe lease three buildings, with a total of approximately 21,908 square feet of office, warehouse and manufacturing space, that house the Company’sour corporate administration, sales and marketing, and engineering departments. The buildings also are used for production and warehousing by the Company’sour RF Connector and Cable Assembly and Comnet Telecom divisions. On June 5, 2017,segment. We also lease spaces in four other locations in the Company entered into a fifth amendment to its lease for its facility in San Diego, California. As a result,United States that house the Company now leases a total of approximately 21,908 square feet of office, warehouseadministration offices and manufacturing space at its San Diego location.facilities for our Custom Cabling segment. The termtable below shows a summary of the lease expires on Julysquare footage of these locations as of October 31, 2022, and the rental payments under the lease currently are $22,721 per month. The San Diego lease also requires the payment of the Company’s pro rata share of real estate taxes and insurance, maintenance and other operating expenses related to the facilities.2020:

The aggregate monthly rental for all of the Company’s facilities currently is approximately $53,000 per month, plus utilities, maintenance and insurance.

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. As of the date of this report, we are not subject to any proceeding that is not in the ordinary course of business or that is material to the financial condition of our business.

Not applicable.None.

PART II

The Company’s Common StockMarket Information. RF Industries, Ltd.’s common stock is listed and trades on the NASDAQNasdaq Global Market and is traded under the symbol “RFIL.”“RFIL” trading symbol.

The price range per share of common stock presented below represents the highest and lowest intraday sales prices for the Company’s common stock on the NASDAQ during each quarter of the two most recent years.