UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2017
or
[ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file numbernumber: 001-38448
EDISON NATION, INC.
(Exact Name of Registrant as Specified in Its Charter)
82-2199200 | |||||
(State or Other Jurisdiction | (I.R.S. Employer | ||||
of Incorporation or Organization) | |||||
Bethlehem, Pennsylvania | 18018 | |||
(Address of Principal Executive Offices) | (Zip Code) |
(484) 893-0060
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Name of exchange on which registered | |
Common Stock, $0.001 par value per share | Nasdaq |
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.
[ ] Yes ☐[X] No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.
[ ] Yes ☐[X] No ☒
Indicate by check mark whether the Registrantregistrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrantregistrant 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 Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) 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 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”company,” and emerging“emerging growth companycompany” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | Accelerated filer | ||||
Non-accelerated filer | Smaller Reporting Company [X] | ||||
Emerging |
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 on June 30, 2019 (the last business day of the Company’s most recently completed second quarter) of the voting and non-voting common equitystock held by non-affiliates of the registrant, based uponcomputed by reference to the closing price of the stock on that date, was approximately $7,734,303. The registrant does not have non-voting common stock on the last business day of the most recently completed second fiscal quarter, June 30, 2017, as the Company was not public at that time. There also is no aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant, based upon the closing price of common stock on April 20, 2018, as the Company has not begun trading on a public exchange or market. Shares of voting stock held by each executive officer, director and 10% stockholders will have been excluded from this calculation. This determination of affiliate status is not necessarily a conclusive determination for other purposes.
As of April 20, 2018, 3,000,000May 28, 2020, there were 9,210,401 shares of the registrant’s common stock were outstanding.
EXPLANATORY NOTE
Edison Nation, Inc. (the “Company”) is filing this amendment (this “Amendment”) to its Annual Report contains forward-looking statements withinon Form 10-K, filed on May 29, 2020 (the “Original Form 10-K”), solely to disclose that the meaningCompany had filed the Original Form 10-K after the March 30, 2020 deadline applicable to the Company for the filing of a Form 10-K in reliance on the 45-day extension provided by an order issued by the U.S. Securities and Exchange Commission (the “SEC”) under Section 27A of the Securities Act of 1933, and Section 21E36 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), Modifying Exemptions From the Reporting and Proxy Delivery Requirements for Public Companies, dated March 25, 2020 (Release No. 34-88465) (the “Order”). These statements relate
On March 26, 2020, the Company filed a Current Report on Form 8-K to future events or our future financial performance. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “expects,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predict,” “should” or “will” or the negative of these terms or other comparable terminology. These statements are only predictions; uncertainties and other factors may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels or activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Our expectations are as of the date this Annual Report is filed, and we do not intend to update any of the forward-looking statements after the date this Annual Report is filed to confirm these statements to actual results, unless required by law.
As disclosed in the Form 8-K, in order to manufacture many of the United States;
As a result of the industriesCOVID-19 quarantines described above, the Company’s operations in which we operate are necessarily subjectChina were unable to a high degreefully resume from the end of uncertainty and riskthe “Chinese New Year” on February 8, 2020, until March 23, 2020. Specifically, the Company relied on the Order due to a variety of factors. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including, but not limitedoperational suspension causing the Company’s finance team to the possibility that we may fail to preserve our expertise in consumer product development; that existing and potential distribution partners may opt to work with, or favor the products of, competitors if our competitors offer more favorable products or pricing terms; that we may be unable to maintain or grow sources of revenue; that changes in the distribution network composition may lead to decreases in query volumes; that we may be unable to attain and maintain profitability; that we may be unable to attract and retain key personnel; that we may not be able to effectively manage, or to increase, our relationships with customers; that we may have unexpected increases in costs and expenses; or that one or morecomplete the preparation of the other risks described below in the section entitled “Risk Factors”Company’s consolidated financial statements and elsewhere in this Annual Report may occur. These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us.
In addition, as of December 31, 2017:
| | | For the Twelve Months Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Revenues: | | | | | | | | | | | | | |
Fergco | | | | $ | 5,554,677 | | | | | $ | 5,013,133 | | |
SRM | | | | $ | 9,405,773 | | | | | $ | 11,008,867 | | |
Total consolidated revenues | | | | $ | 14,960,450 | | | | | $ | 16,022,000 | | |
|
| | | For the Twelve Months Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Cost of revenues: | | | | | | | | | | | | | |
Fergco | | | | $ | 4,048,070 | | | | | $ | 3,370,275 | | |
SRM | | | | $ | 6,969,555 | | | | | $ | 7,684,720 | | |
Total consolidated cost of revenues | | | | $ | 11,017,625 | | | | | $ | 11,054,995 | | |
|
| | | For the Twelve Months Ended December 31, | | |||||||||||||||||||||
| | | 2017 | | | % | | | 2016 | | | % | | ||||||||||||
Fergco | | | | $ | 1,506,607 | | | | | | 27.1% | | | | | $ | 1,642,858 | | | | | | 32.7% | | |
SRM | | | | $ | 2,436,218 | | | | | | 25.9% | | | | | $ | 3,324,147 | | | | | | 30.0% | | |
Total consolidated gross profit and gross margin | | | | $ | 3,942,825 | | | | | | 26.4% | | | | | $ | 4,967,005 | | | | | | 30.7% | | |
|
| | | December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Assets | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 557,268 | | | | | $ | 2,534,753 | | |
Accounts receivable, net | | | | | 1,430,236 | | | | | | 1,498,705 | | |
Inventory | | | | | 240,061 | | | | | | 164,511 | | |
Prepaid expenses and other current assets | | | | | 41,461 | | | | | | 42,154 | | |
Due from related party | | | | | 834,897 | | | | | | — | | |
Total Current Assets | | | | | 3,103,923 | | | | | | 4,240,123 | | |
Property and equipment, net | | | | | 966,904 | | | | | | 1,116,036 | | |
Total Assets | | | | $ | 4,070,827 | | | | | $ | 5,356,159 | | |
Liabilities and Stockholders’ Equity (Deficit) | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts payable | | | | $ | 1,135,039 | | | | | $ | 843,424 | | |
Accrued expenses and other current liabilities | | | | | 137,709 | | | | | | 114,362 | | |
Due to related party | | | | | — | | | | | | 132,404 | | |
Current portion of notes payable – related parties | | | | | 225,553 | | | | | | — | | |
Total Current Liabilities | | | | | 1,498,301 | | | | | | 1,090,190 | | |
Notes payable – related parties, non-current | | | | | 2,770,947 | | | | | | 2,996,500 | | |
Deferred tax liability | | | | | 34,209 | | | | | | 5,810 | | |
Total Liabilities | | | | $ | 4,303,457 | | | | | $ | 4,092,500 | | |
Commitments and Contingencies (Note 9) | | | | | | | | | | | | | |
Stockholders’ Equity (Deficit) | | | | | | | | | | | | | |
Common stock, $0.001 par value, 250,000,000 shares authorized; 3,000,000 shares issued and outstanding as of December 31, 2017 and 2016 | | | | $ | 3,000 | | | | | $ | 3,000 | | |
Additional paid-in capital | | | | | — | | | | | | 746,526 | | |
Retained Earnings Accumulated (Deficit) | | | | | (235,630) | | | | | | 514,133 | | |
Total Stockholders’ Equity (Deficit) | | | | | (232,630) | | | | | | 1,263,659 | | |
Total Liabilities and Stockholders’ Equity (Deficit) | | | | $ | 4,070,827 | | | | | $ | 5,356,159 | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Revenues, net | | | | $ | 14,960,450 | | | | | $ | 16,022,000 | | |
Cost of revenues | | | | | 11,017,625 | | | | | | 11,054,995 | | |
Gross Profit | | | | | 3,942,825 | | | | | | 4,967,005 | | |
Operating Expenses: | | | | | | | | | | | | | |
Selling, general and administrative | | | | | 2,383,104 | | | | | | 4,535,920 | | |
Total Operating Expenses | | | | | 2,383,104 | | | | | | 4,535,920 | | |
Operating Income | | | | | 1,559,721 | | | | | | 431,085 | | |
Other Income: | | | | | | | | | | | | | |
Rental income | | | | | 102,815 | | | | | | 102,815 | | |
Interest income | | | | | 4,000 | | | | | | 5,838 | | |
Total Other Income | | | | | 106,815 | | | | | | 108,653 | | |
Income Before Income Taxes | | | | | 1,666,536 | | | | | | 539,738 | | |
Income tax expense | | | | | 133,105 | | | | | | 40,372 | | |
Net Income | | | | $ | 1,533,431 | | | | | $ | 499,366 | | |
Net Income Per Share | | | | | | | | | | | | | |
– Basic and Diluted | | | | $ | 0.51 | | | | | $ | 0.17 | | |
Weighted Average Number of Common Shares Outstanding | | | | | | | | | | | | | |
– Basic and Diluted | | | | | 3,000,000 | | | | | | 3,000,000 | | |
|
| | | Common Stock | | | Additional Paid-in Capital | | | Retained Earnings Accumulated (Deficit) | | | Total Stockholders’ Equity | | ||||||||||||||||||
| | | Shares | | | Amount | | ||||||||||||||||||||||||
Balance, January 1, 2016 | | | | | 3,000,000 | | | | | $ | 3,000 | | | | | $ | 746,526 | | | | | $ | 274,256 | | | | | $ | 1,023,782 | | |
Dividends | | | | | | | | | | | | | | | | | | | | | | | (259,489) | | | | | | (259,489) | | |
Net income | | | | | | | | | | | | | | | | | | | | | | | 499,366 | | | | | | 499,366 | | |
Balance, December 31, 2016 | | | | | 3,000,000 | | | | | | 3,000 | | | | | | 746,526 | | | | | | 514,133 | | | | | | 1,263,659 | | |
Dividends | | | | | | | | | | | | | | | | | (746,526) | | | | | | (2,283,194) | | | | | | (3,029,720) | | |
Net income | | | | | | | | | | | | | | | | | | | | | | | 1,533,431 | | | | | | 1,533,431 | | |
Balance, December 31, 2017 | | | | | 3,000,000 | | | | | $ | 3,000 | | | | | $ | — | | | | | $ | (235,630) | | | | | $ | (232,630) | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Cash Flow from Operating Activities | | | | | | | | | | | | | |
Net income | | | | $ | 1,533,431 | | | | | $ | 499,366 | | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 188,283 | | | | | | 190,938 | | |
Changes in assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | 68,469 | | | | | | (250,974) | | |
Inventory | | | | | (75,550) | | | | | | 11,269 | | |
Prepaid expenses and other current assets | | | | | 693 | | | | | | 70,418 | | |
Accounts payable | | | | | 291,615 | | | | | | 615,175 | | |
Accrued expenses and other current liabilties | | | | | 23,347 | | | | | | (189,327) | | |
Deferred tax liability | | | | | 28,399 | | | | | | (5,015) | | |
Due to/from related party | | | | | (967,301) | | | | | | (407,962) | | |
Net Cash Provided by Operating Activities | | | | | 1,091,386 | | | | | | 533,888 | | |
Cash Flows from Investing Activities | | | | | | | | | | | | | |
Purchases of property and equipment | | | | | (39,151) | | | | | | (219,015) | | |
Net Cash Used in Investing Activities | | | | | (39,151) | | | | | | (219,015) | | |
Cash Flows from Financing Activities | | | | | | | | | | | | | |
Dividends paid | | | | | (3,029,720) | | | | | | (259,489) | | |
Net Cash Used in Financing Activities | | | | | (3,029,720) | | | | | | (259,489) | | |
Net (Decrease) Increase in Cash and Cash Equivalents | | | | | (1,977,485) | | | | | | 55,384 | | |
Cash and Cash Equivalents – Beginning of Year | | | | | 2,534,753 | | | | | | 2,479,369 | | |
Cash and Cash Equivalents – End of Year | | | | $ | 557,268 | | | | | $ | 2,534,753 | | |
Supplemental Disclosures of Cash Flow Information: | | | | | | | | | | | | | |
Cash paid during the year for: | | | | | | | | | | | | | |
Interest | | | | $ | — | | | | | $ | — | | |
Income taxes | | | | $ | 64,465 | | | | | $ | 45,233 | | |
|
| | | December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Raw materials | | | | $ | 30,410 | | | | | $ | 25,001 | | |
Finished goods | | | | | 209,651 | | | | | | 139,510 | | |
Total inventory | | | | $ | 240,061 | | | | | $ | 164,511 | | |
|
| | | December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Customer deposits | | | | $ | 30,890 | | | | | $ | — | | |
Other | | | | | 10,571 | | | | | | 42,154 | | |
Total prepaid expenses and other current assets | | | | $ | 41,461 | | | | | $ | 42,154 | | |
|
| | | December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Land | | | | $ | 79,100 | | | | | $ | 79,100 | | |
Buildings | | | | | 427,704 | | | | | | 414,404 | | |
Building improvements | | | | | 745,685 | | | | | | 745,685 | | |
Equipment and machinery | | | | | 3,899,040 | | | | | | 3,877,058 | | |
Furniture and fixtures | | | | | 280,124 | | | | | | 276,646 | | |
Computer software | | | | | 23,518 | | | | | | 23,518 | | |
Molds | | | | | 4,552,374 | | | | | | 4,546,856 | | |
Vehicles | | | | | 404,759 | | | | | | 404,759 | | |
| | | | | 10,412,304 | | | | | | 10,368,026 | | |
Less: accumulated depreciation and amortization | | | | | (9,445,400) | | | | | | (9,251,990) | | |
Property and equipment, net | | | | $ | 966,904 | | | | | $ | 1,116,036 | | |
|
| | | December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Accrued income taxes | | | | $ | 56,745 | | | | | $ | 16,503 | | |
Accrued other taxes | | | | | 55,413 | | | | | | 56,076 | | |
Accrued payroll and benefits | | | | | 8,703 | | | | | | 12,907 | | |
Accrued professional fees | | | | | 16,848 | | | | | | 28,876 | | |
Total accrued expenses and other current liabilities | | | | $ | 137,709 | | | | | $ | 114,362 | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
United States | | | | $ | 49,097 | | | | | $ | 317,611 | | |
Foreign | | | | | 1,617,439 | | | | | | 222,127 | | |
Income before income taxes | | | | $ | 1,666,536 | | | | | $ | 539,738 | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Deferred tax assets: | | | | | | | | | | | | | |
Net operating loss carryforwards | | | | $ | 50,524 | | | | | $ | — | | |
Less: valuation allowance | | | | | (50,524) | | | | | | — | | |
Net deferred tax assets | | | | | — | | | | | | — | | |
Deferred tax liabilities: | | | | | | | | | | | | | |
Property and equipment | | | | | 34,209 | | | | | | 5,810 | | |
Deferred tax liabilities | | | | | 34,209 | | | | | | 5,810 | | |
Net deferred tax liabilities | | | | $ | 34,209 | | | | | $ | 5,810 | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Current: | | | | | | | | | | | | | |
Federal | | | | $ | 27,513 | | | | | $ | — | | |
Foreign | | | | | 71,125 | | | | | | 45,362 | | |
State and local | | | | | 6,069 | | | | | | — | | |
Total current | | | | | 104,707 | | | | | | 45,362 | | |
Deferred: | | | | | | | | | | | | | |
Federal | | | | $ | 23,249 | | | | | $ | — | | |
Foreign | | | | | (3,153) | | | | | | (4,990) | | |
State and local | | | | | 8,302 | | | | | | — | | |
Total deferred | | | | | 28,398 | | | | | | (4,990) | | |
Income tax provision (benefit) | | | | $ | 133,105 | | | | | $ | 40,372 | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Tax at federal statutory rate | | | | | 34.0% | | | | | | 34.0% | | |
Effect of U.S. tax law change | | | | | -0.9% | | | | | | 0.0% | | |
U.S. income attributable to pass-through entity | | | | | -4.4% | | | | | | -20.0% | | |
U.S. income subject to valuation allowance | | | | | 4.9% | | | | | | 0.0% | | |
State and local income taxes | | | | | 0.9% | | | | | | 0.0% | | |
Foreign income not subject to U.S. federal tax | | | | | -33.0% | | | | | | -14.0% | | |
Foreign tax | | | | | 4.1% | | | | | | 7.5% | | |
Other | | | | | 2.4% | | | | | | 0.0% | | |
Effective income tax rate | | | | | 8.0% | | | | | | 7.5% | | |
|
For the Years Ended December 31, | | | Amount | | |||
2018 | | | | $ | 225,553 | | |
2019 | | | | | 239,465 | | |
2020 | | | | | 920,347 | | |
2021 | | | | | 190,963 | | |
2022 | | | | | 1,420,172 | | |
| | | | $ | 2,996,500 | | |
|
| | | For the Years Ended December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Revenues: | | | | | | | | | | | | | |
Fergco | | | | $ | 5,554,677 | | | | | $ | 5,013,133 | | |
SRM | | | | | 9,405,773 | | | | | | 11,008,867 | | |
Total segment and consolidated revenues | | | | $ | 14,960,450 | | | | | $ | 16,022,000 | | |
Gross profit: | | | | | | | | | | | | | |
Fergco | | | | $ | 1,506,607 | | | | | $ | 1,642,858 | | |
SRM | | | | | 2,436,218 | | | | | | 3,324,147 | | |
Total segment and consolidated gross profit | | | | $ | 3,942,825 | | | | | $ | 4,967,005 | | |
Income from operations: | | | | | | | | | | | | | |
Fergco | | | | $ | 182,878 | | | | | $ | 194,040 | | |
SRM | | | | | 1,617,433 | | | | | | 237,045 | | |
Corporate | | | | | (240,590) | | | | | | — | | |
Total segment and consolidated income from operations | | | | $ | 1,559,721 | | | | | $ | 431,085 | | |
Depreciation and amortization: | | | | | | | | | | | | | |
Fergco | | | | $ | 140,828 | | | | | $ | 121,414 | | |
SRM | | | | | 47,455 | | | | | | 69,524 | | |
Total segment depreciation and amortization | | | | $ | 188,283 | | | | | $ | 190,938 | | |
|
| | | December 31, | | |||||||||
| | | 2017 | | | 2016 | | ||||||
Segment total assets | | | | | | | | | | | | | |
Fergco | | | | $ | 1,853,273 | | | | | $ | 3,548,918 | | |
SRM | | | | | 2,217,296 | | | | | | 1,807,241 | | |
Corporate | | | | | 258 | | | | | | — | | |
Total segment and consolidated assets | | | | $ | 4,070,827 | | | | | $ | 5,356,159 | | |
|
Except as described above, this Amendment does not modify or update disclosures in, or exhibits to, the Original Form 3 for10-K. Furthermore, this Amendment does not change any previously reported financial results, nor does it reflect events occurring after the Company upon receiptfiling of EDGAR codes, likelythe Original Form 10-K. Accordingly, this Amendment should be read in the next two to three business days), no person who was subject to Section 16 at any time during such fiscal year failed to file on a timely basis, as disclosed in such forms, reports required by Section 16(a) during such fiscal year or prior fiscal years.
Name and Principal Position | | | Year | | | Salary | | | Bonus | | | Stock Awards | | | Option Awards | | | All Other Compensation | | | Total | | |||||||||||||||||||||
Christopher B. Ferguson, Chairman and Chief Executive Officer | | | | | 2017 | | | | | $ | 90,000 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 90,000 | | |
| 2016 | | | | $ | 90,000 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 90,000 | | | |||||
Philip Anderson, Chief Financial Officer | | | | | 2017 | | | | | $ | 0(1) | | | | | $ | 0(1) | | | | | $ | — | �� | | | | $ | — | | | | | $ | 0(1) | | | | | $ | 0(1) | | |
| 2016 | | | | $ | 0(1) | | | | | $ | 0(1) | | | | | $ | — | | | | | $ | — | | | | | $ | 0(1) | | | | | $ | 0(1) | | | |||||
Bruce R. Bennett, Chief Product Officer | | | | | 2017 | | | | | $ | 225,550 | | | | | $ | 1,000 | | | | | $ | — | | | | | $ | — | | | | | $ | 8,844 | | | | | $ | 235,394 | | |
| 2016 | | | | $ | 177,562 | | | | | $ | 1,200 | | | | | $ | — | | | | | $ | — | | | | | $ | 8,934 | | | | | $ | 187,696 | | |
Base Salary. The base salaries of our named executive officers were historically reviewed and set annually by the board of directors of SRM and Fergco; base salaries were also reviewed upon the promotion of an executive officer to a new position or another change in job responsibility. In establishing base salaries for our named executive officers for 2018 and into the future, our Compensation Committee will rely on external market data and peer data obtained from outside sources. In addition to considering the information obtained from such sources, our Compensation Committee will consider the same factors that the board of directors of SRM and Fergco considered:
| | | Shares of Common Stock Beneficially Owned | | |||||||||
Name of beneficial owner | | | Number | | | Percentage | | ||||||
5% Stockholders | | | | | | | | | | | | | |
Stuart J. Ferguson | | | | | 300,000 | | | | | | 10% | | |
Thomas S. Ferguson | | | | | 300,000 | | | | | | 10% | | |
Lelainya D. Ferguson | | | | | 1,453,500(1) | | | | | | 48.45% | | |
Claudia McFillin | | | | | 182,250(2) | | | | | | 6.275% | | |
Stephen R. Mickelberg | | | | | 162,000 | | | | | | 5.4% | | |
Named Executive Officers and Directors | | | | | | | | | | | | | |
Christopher B. Ferguson, Chairman | | | | | 1,755,750(3) | | | | | | 58.525% | | |
Kevin J. Ferguson | | | | | 300,000 | | | | | | 10% | | |
John Marchese, Director | | | | | * | | | | | | *% | | |
Michael Palleschi, Director | | | | | * | | | | | | *% | | |
Richard Williams, Director | | | | | * | | | | | | *% | | |
Philip Anderson | | | | | * | | | | | | *% | | |
Bruce R. Bennett | | | | | * | | | | | | *% | ��� | |
All directors and executive officers as a group (8 persons) | | | | | 2,055,750 | | | | | | 68.525% | | |
| | | Fiscal Year 2017 | | | Fiscal Year 2016 | | ||||||
Audit fees – Marcum | | | | $ | 85,300 | | | | | $ | 123,085 | | |
Tax fees – Marcum | | | | $ | 0 | | | | | $ | 0 | | |
Total | | | | $ | 85,300 | | | | | $ | 123,085 | | |
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) (3) Exhibits:
Exhibit | Incorporated By | Filed | ||||||||
Number | Description | Form | Exhibit | Filing Date | Herewith | |||||
31.1* | Chief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | * | ||||||||
31.2* | Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | * |
* | Filed herewith. |
Financial StatementsSIGNATURES. The following are filed as part of Item 15 of this Annual Report on Form 10-K:
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.
June 4, 2020 | By: | /s/ Christopher B. Ferguson | |
Christopher B. Ferguson | |||
Chairman and Chief Executive Officer |
(Principal Executive Officer) |
Pursuant to the requirements of Section 13 or 15(d) 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 and on the dates indicated.
Signature | Title | Date | ||||||
/s/ Christopher B. Ferguson | Chief Executive Officer and Chairman of the Board of Directors | June 4, 2020 | ||||||
Christopher B. Ferguson | (Principal Executive Officer) | |||||||
Director | June 4, 2020 | |||||||
Louis Foreman | ||||||||
/s/ Frank Jennings | Director | June 4, 2020 | ||||||
Frank Jennings | ||||||||
/s/ Mary Ann Halford | Director | June 4, 2020 | ||||||
Mary Ann Halford | ||||||||
/s/ Kevin J. | ||||||||
Director | ||||||||