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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2004, 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 NO. 0-10235
GENTEX CORPORATION
(Exact name of registrant as specified in its charter)
MICHIGAN 38-2030505
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
600 N. CENTENNIAL, ZEELAND, MICHIGAN 49464
(Address of principal executive offices) (Zip Code)
(616) 772-1800
(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
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.
Yes (X) No ( )
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes (X) No ( )
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes ( ) No ( )
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Shares Outstanding
Class at October 20, 2004
----- -------------------
Common Stock, $0.06 Par Value 77,652,005
Exhibit Index located at page 13
Page 1 of 31
PART I. FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
GENTEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, 2004 December 31, 2003
------------------ -----------------
(Unaudited) (Audited)
------------ ------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $407,918,422 $322,662,971
Short-term investments 66,966,302 70,943,685
Accounts receivable, net 63,608,959 58,955,823
Inventories 28,051,346 20,938,696
Prepaid expenses and other 11,234,599 11,848,156
------------ ------------
Total current assets 577,779,628 485,349,331
PLANT AND EQUIPMENT - NET 130,634,607 126,806,882
OTHER ASSETS
Long-term investments 115,531,513 145,615,934
Patents and other assets, net 5,530,471 4,757,619
------------ ------------
Total other assets 121,061,984 150,373,553
------------ ------------
Total assets $829,476,219 $762,529,766
============ ============
LIABILITIES AND SHAREHOLDERS' INVESTMENT
CURRENT LIABILITIES
Accounts payable $ 22,191,954 $ 18,259,111
Accrued liabilities 32,757,678 32,221,369
------------ ------------
Total current liabilities 54,949,632 50,480,480
DEFERRED INCOME TAXES 18,136,366 18,405,955
SHAREHOLDERS' INVESTMENT
Common stock 4,659,120 4,622,449
Additional paid-in capital 169,659,259 152,874,325
Retained earnings 576,103,320 528,358,825
Other shareholders' investment 5,968,522 7,787,732
------------ ------------
Total shareholders' investment 756,390,221 693,643,331
------------ ------------
Total liabilities and
shareholders' investment $829,476,219 $762,529,766
============ ============
See accompanying notes to condensed consolidated financial statements.
- 2 -
GENTEX CORPORATION AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Nine Months Ended
September 30 September 30
--------------------------- ---------------------------
2004 2003 2004 2003
------------ ------------ ------------ ------------
NET SALES $120,456,707 $112,878,954 $379,430,532 $345,104,850
COST OF GOODS SOLD 72,754,752 65,793,563 222,388,833 201,621,876
------------ ------------ ------------ ------------
Gross profit 47,701,955 47,085,391 157,041,699 143,482,974
OPERATING EXPENSES:
Engineering, research and development 7,758,575 6,944,138 22,747,948 19,462,760
Selling, general
& administrative 6,550,287 5,693,743 20,175,499 17,310,739
------------ ------------ ------------ ------------
Total operating expenses 14,308,862 12,637,881 42,923,447 36,773,499
------------ ------------ ------------ ------------
Income from operations 33,393,093 34,447,510 114,118,252 106,709,475
OTHER INCOME (EXPENSE)
Interest and dividend income 2,263,373 2,372,517 6,507,213 7,796,492
Other 1,168,367 1,225,098 3,309,635 574,035
------------ ------------ ------------ ------------
Total other income 3,431,740 3,597,615 9,816,848 8,370,527
------------ ------------ ------------ ------------
Income before provision
for income taxes 36,824,833 38,045,125 123,935,100 115,080,002
PROVISION FOR INCOME TAXES 11,600,000 12,364,000 39,910,000 37,400,000
------------ ------------ ------------ ------------
NET INCOME $ 25,224,833 $ 25,681,125 $ 84,025,100 $ 77,680,002
============ ============ ============ ============
EARNINGS PER SHARE:
Basic $ 0.33 $ 0.34 $ 1.09 $ 1.02
Diluted $ 0.32 $ 0.33 $ 1.07 $ 1.01
Cash Dividends Declared per Share $ 0.17 $ 0.15 $ 0.47 $ 0.15
See accompanying notes to condensed consolidated financial statements.
- 3 -
GENTEX CORPORATION AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended September 30,
-------------------------------
2004 2003
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 84,025,100 $ 77,680,002
Adjustments to reconcile net income to net
cash provided by operating activities-
Depreciation and amortization 16,976,090 15,977,561
(Gain) loss on disposal of assets (863) 75,626
(Gain) loss on sale of investments (2,367,909) 872,848
Deferred income taxes 621,584 490,376
Amortization of deferred compensation 1,149,778 844,226
Tax benefit of stock plan transactions 2,693,941 5,993,320
Change in operating assets and liabilities:
Accounts receivable, net (4,653,136) (27,445,645)
Inventories (7,112,650) (2,599,478)
Prepaid expenses and other 411,208 (1,376,344)
Accounts payable 3,932,843 5,305,620
Accrued liabilities, excluding dividends declared (983,396) 1,535,126
------------- -------------
Net cash provided by
operating activities 94,692,590 77,353,238
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Plant and equipment additions (20,705,920) (15,982,008)
Proceeds from sale of plant and equipment 44,500 72,000
(Increase) decrease in investments 34,461,644 78,356,378
Increase in other assets (809,321) (552,725)
------------- -------------
Net cash provided by (used for)
investing activities 12,990,903 61,893,645
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock from
stock plan transactions 12,332,859 13,818,575
Cash dividends paid (34,760,901) 0
Repurchases of common stock 0 (10,246,810)
------------- -------------
Net cash provided by (used for)
financing activities (22,428,042) 3,571,765
------------- -------------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 85,255,451 142,818,648
CASH AND CASH EQUIVALNTS,
beginning of period 322,662,971 168,834,111
------------- -------------
CASH AND CASH EQUIVALENTS,
end of period $ 407,918,422 $ 311,652,759
============= =============
See accompanying notes to condensed consolidated financial statements.
- 4 -
GENTEX CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(1) The unaudited condensed consolidated financial statements included herein
have been prepared by the Registrant, without audit, pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally
accepted in the United States have been condensed or omitted pursuant to
such rules and regulations, although the Registrant believes that the
disclosures are adequate to make the information presented not misleading.
It is suggested that these unaudited condensed consolidated financial
statements be read in conjunction with the financial statements and notes
thereto included in the Registrant's 2003 annual report on Form 10-K.
(2) In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments, consisting of
only a normal and recurring nature, necessary to present fairly the
financial position of the Registrant as of September 30, 2004, and the
results of operations and cash flows for the interim periods presented.
(3) Inventories consisted of the following at the respective balance sheet
dates:
September 30, 2004 December 31, 2003
------------------ -----------------
Raw materials $16,315,646 $ 11,041,622
Work-in-process 2,776,280 2,401,500
Finished goods 8,959,420 7,495,574
----------- ------------
$28,051,346 $ 20,938,696
=========== ============
(4) The following table reconciles the numerators and denominators used in the
calculation of basic and diluted earnings per share (EPS):
Quarter Ended September 30, Nine Months Ended September 30,
---------------------------- -------------------------------
2004 2003 2004 2003
---- ---- ---- ----
Numerators:
Numerator for both basic and
diluted EPS, net income $25,224,833 $25,681,125 $84,025,100 $77,680,002
Denominators:
Denominator for basic EPS,
weighted-average shares
outstanding 77,243,550 76,348,527 77,059,166 76,106,950
Potentially dilutive shares
resulting from stock plans 974,411 1,220,334 1,314,345 960,198
----------- ----------- ----------- -----------
Denominator for diluted EPS 78,217,961 77,568,861 78,373,511 77,067,148
=========== =========== =========== ===========
Shares related to stock plans
not included in diluted average
common shares outstanding
because their effect would be
antidilutive 1,486,831 223,383 683,461 674,884
(5) At September 30, 2004, the Company had two stock option plans and an
employee stock purchase plan. The Company accounts for these plans under
the recognition and measurement principles of APB Opinion No. 25
(Accounting for Stock Issued to Employees) and related interpretations. No
stock-based employee compensation cost is reflected in net income, since
options granted under these plans have an exercise price equal to the
market value of the underlying common stock on the date of grant. The
following table illustrates the effect on net income and earnings per
share if the Company had applied the fair value recognition provisions of
Statement of Financial Accounting Standards (SFAS) No. 123, "Accounting
for Stock-Based Compensation," to stock-based employee compensation.
- 5 -
GENTEX CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONT.)
Quarter Ended September 30, Nine Months Ended September 30,
--------------------------- -------------------------------
2004 2003 2004 2003
---- ---- ---- ----
Net income, as reported $25,224,833 $25,681,125 $ 84,025,100 $77,680,002
Deduct: Total stock-based employee
compensation expense determined
under fair value-based method of all
awards, net of tax effects (4,058,943) (2,717,304) (10,676,152) (7,731,314)
----------- ----------- ------------ -----------
Pro forma net income $21,165,890 $22,963,821 $ 73,348,948 $69,948,688
=========== =========== ============ ===========
Earnings per share:
Basic - as reported $ .33 $ .34 $ 1.09 $ 1.02
Basic - pro forma .27 .30 .95 .92
Diluted - as reported .32 .33 1.07 1.01
Diluted - pro forma .27 .30 .94 .91
(6) Comprehensive income reflects the change in equity of a business
enterprise during a period from transactions and other events and
circumstances from non-owner sources. For the Company, comprehensive
income represents net income adjusted for items such as unrealized gains
and losses on investments and foreign currency translation adjustments.
Comprehensive income was as follows:
September 30, 2004 September 30, 2003
------------------ -------------------
Quarter Ended $ 23,098,757 $ 27,635,064
Nine Months Ended 82,850,918 89,260,627
(7) The increase in common stock during the quarter and nine months ended
September 30, 2004, was attributable to the issuance of 198,005 and
611,189 shares, respectively, of the Company's common stock under its
stock-based compensation plans. The Company has also recorded a $0.15 per
share cash dividend in the first two quarters of 2004 and a $0.17 per
share cash dividend in the third quarter. The third quarter dividend of
approximately $13,201,000, was declared on August 18, 2004, and is payable
on October 21, 2004.
(8) The Company currently manufactures electro-optic products, including
automatic-dimming rearview mirrors for the automotive industry, and fire
protection products for the commercial building industry:
Quarter Ended September 30, Nine Months Ended September 30,
--------------------------- -------------------------------
2004 2003 2004 2003
---- ---- ---- ----
Revenue:
Automotive Products $ 114,546,283 $107,020,164 $ 362,111,159 $ 328,091,167
Fire Protection Products 5,910,424 5,858,790 17,319,373 17,013,683
------------- ------------ ------------- -------------
Total $ 120,456,707 $112,878,954 $ 379,430,532 $ 345,104,850
============= ============ ============= =============
Operating Income:
Automotive Products $ 32,160,066 $ 33,184,710 $ 110,651,518 $ 103,318,451
Fire Protection Products 1,233,027 1,262,800 3,466,734 3,391,024
------------- ------------ ------------- -------------
Total $ 33,393,093 $ 34,447,510 $ 114,118,252 $ 106,709,475
============= ============ ============= =============
- 6 -
GENTEX CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONT.)
(9) On October 13, 2004, the Financial Accounting Standards Board (FASB)
concluded that FASB Statement No. 123R, "Share-Based Payment," which would
require all share-based payments to employees, including grants of
employee stock options, to be recognized in the income statement based on
their fair values, would be effective for public companies for interim or
annual periods beginning after June 15, 2005. The Company does not intend
to adopt a fair-value based method of accounting for stock-based employee
compensation until a final standard is issued by the FASB that requires
this accounting. Proforma disclosures of quarterly earnings are included
in Note 5 of this quarterly statement.
In January 2003, the FASB issued Interpretation No. 46, "Consolidation of
Variable Interest Entities." This standard clarifies the application of
Accounting Research Bulletin No. 51, "Consolidated Financial Statements,"
and addresses consolidation by business enterprises of variable interest
entities. Interpretation No. 46 requires existing unconsolidated variable
interest entities to be consolidated by their primary beneficiaries if the
entities do not effectively disperse risk among the parties involved.
Interpretation No. 46 also enhances the disclosure requirements related to
variable interest entities. This interpretation was effective for any
variable interest entered into by the Company as of the end of the first
quarter of 2004. The adoption of Interpretation No. 46 did not have any
significant effect on the Company's consolidated financial statements.
- 7 -
GENTEX CORPORATION AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
RESULTS OF OPERATIONS:
THIRD QUARTER 2004 VERSUS THIRD QUARTER 2003
Net Sales. Net sales for the third quarter of 2004 increased by
approximately $7,578,000, or 7%, when compared with the third quarter last
year. Net sales of the Company's automotive auto-dimming mirrors increased
by approximately $7,526,000, or 7%, in the third quarter of 2004, when
compared to the third quarter last year, as auto-dimming mirror unit
shipments increased by 11% from approximately 2,475,000 in the third
quarter of 2003 to 2,756,000 in the current quarter. This increase
reflected the increased penetration of interior auto-dimming mirrors on
2004 and 2005 model year vehicles during the third quarter of 2004. Unit
shipments to customers in North America for the current quarter decreased
by 1% compared with the third quarter of the prior year, primarily due to
lower exterior mirror shipments as the result of end of the model year
inventory adjustments by certain tier one exterior mirror suppliers.
Mirror unit shipments for the current quarter to automotive customers
outside North America increased by 26% compared with the third quarter in
2003, primarily due to increased interior mirror shipments to European and
Asian-Pacific automakers as a result of increased penetration. Net sales
of the Company's fire protection products increased 1% for the current
quarter, primarily due to higher sales of certain of the Company's
signaling products.
Cost of Goods Sold. As a percentage of net sales, cost of goods sold
increased from 58.3% in the third quarter of 2003 to 60.4% in the third
quarter of 2004. This percentage increase primarily reflected annual
customer price reductions and start-up costs related to the introduction
of a number of new automated manufacturing processes during the quarter.
Each factor is estimated to have impacted cost of goods sold as a
percentage of net sales by approximately 1-2 percentage points.
Operating Expenses. Engineering, research and development expenses for the
quarter increased approximately $814,000, from 6.2% to 6.4% of net sales,
when compared with the same quarter last year, primarily reflecting
additional staffing, engineering and testing for new product development,
including mirrors with additional electronic features. Selling, general
and administrative expenses increased approximately $857,000, for the
quarter, from 5.0% to 5.4% of net sales, when compared with the third
quarter of 2003. This increased expense primarily reflected the continued
expansion of the Company's overseas sales and engineering offices.
Total Other Income. Total other income for the quarter decreased by
approximately $165,000 when compared with the third quarter of 2003,
primarily due to reduced interest income due to a higher proportion of
tax-exempt investments.
Income Taxes. The Company's effective income tax rate decreased from 32.5%
in the third quarter of 2003 to 31.5% in the third quarter of 2004,
primarily due to higher tax-exempt investment income.
NINE MONTHS ENDED SEPTEMBER 30, 2004, VERSUS NINE MONTHS ENDED SEPTEMBER
30, 2003
Net Sales. Net sales for the nine months ended September 30, 2004,
increased by approximately $34,326,000, or 10%, when compared with the
same period last year. Net sales of the Company's automotive auto-dimming
mirrors increased by approximately $34,020,000, or 10%, as auto-dimming
mirror unit shipments increased by 16% from approximately 7,544,000 in the
first nine months of 2003 to 8,739,000 in the first nine months of 2004.
This increase reflected the increased penetration on 2004 and 2005 model
year vehicles for interior and exterior auto-dimming mirrors. Unit
shipments to customers in North America increased by 5% for the first nine
months of 2004 compared with the same period last year, primarily due to
increased penetration among Asian transplants. Mirror unit shipments to
automotive customers outside North America increased by 29% for the first
nine months of 2004 compared with the first nine months in 2003, primarily
due to increased interior and exterior mirror sub-assembly shipments to
European and Asian-Pacific automakers as a result of increased
penetration. Net sales of
- 8 -
the Company's fire protection products increased 2% for the first nine
months of 2004, primarily due to higher sales of certain of the Company's
signaling products.
Cost of Goods Sold. As a percentage of net sales, cost of goods sold
increased slightly from 58.4% to 58.6% in the first nine months of 2004,
when compared to the same nine-month period in the prior year. This slight
percentage increase primarily reflected annual customer price reductions,
mostly offset by the higher sales level leveraged over the fixed overhead
costs and product mix. Each factor is estimated to have impacted cost of
goods sold as a percentage of net sales by approximately 1-2 percentage
points.
Operating Expenses. For nine months ended September 30, 2004, engineering,
research and development expenses increased approximately $3,285,000, from
5.6% to 6.0% of net sales, when compared with the same period last year,
primarily reflecting additional staffing for new product development,
including mirrors with additional electronic features. Selling, general
and administrative expenses increased approximately $2,865,000 for the
first nine months of 2004, and increased from 5.0% to 5.3% of net sales
when compared to the first nine months of 2003. This increased expense
primarily reflected the continued expansion of the Company's overseas
sales and engineering office as well as the stronger euro exchange rate.
Other Income - Net. Other income for the nine months ended September 30,
2004, increased by approximately $1,446,000 when compared with the first
nine months of 2003, primarily due to realized gains on the sale of equity
investments in the current year period, partially offset by reduced
interest income due to lower interest rates.
FINANCIAL CONDITION:
Cash flow from operating activities for the nine months ended September
30, 2004, increased $17,340,000 to $94,693,000, compared to $77,353,000,
for the same period last year, primarily due to lower growth in accounts
receivable and increased net income. During the third quarter of 2003, the
Company's largest customer extended its payment terms to its suppliers,
which resulted in a one-time increase in accounts receivable. Capital
expenditures for the nine months ended September 30, 2004, were
$20,706,000, compared to $15,982,000 for the same period last year.
The Company now expects that the construction of its fourth automotive
manufacturing facility and a new corporate facility will be completed in
early 2006. The completion date has been pushed back from the original
date due to improved manufacturing capacity utilization. The Company plans
to invest approximately $40-45 million for the new facilities during
2004-2006, which will be funded from its cash and cash equivalents on
hand.
Cash and cash equivalents as of September 30, 2004, increased
approximately $85,255,000 compared to December 31, 2003. The increase was
primarily due to cash flow from operations.
Management considers the Company's working capital and long-term
investments totaling approximately $638,362,000 as of September 30, 2004,
together with internally generated cash flow and an unsecured $5,000,000
line of credit from a bank, to be sufficient to cover anticipated cash
needs for the next year and for the foreseeable future.
On October 8, 2002, the Company announced a share repurchase plan, under
which the Company may purchase up to 4,000,000 shares based on a number of
factors, including market conditions, the market price of the Company's
common stock, anti-dilutive effect on earnings, available cash and other
factors that the Company deems appropriate. During the quarter ended March
31, 2003, the Company repurchased 415,000 shares at a cost of
approximately $10,247,000. No shares have been repurchased subsequently by
the Company.
TRENDS AND DEVELOPMENTS:
The Company is subject to market risk exposures of varying correlations
and volatilities, including foreign exchange rate risk, interest rate risk
and equity price risk. During the quarter ended September 30, 2004, there
were no significant changes in the market risks reported in the Company's
2003 Form 10-K report.
- 9 -
The Company has some assets, liabilities and operations outside the United
States, which currently are not significant. Because the Company sells its
automotive mirrors throughout the world, it could be significantly
affected by weak economic conditions in worldwide markets that could
reduce demand for its products.
The Company continues to experience pricing pressures from its automotive
customers, which have affected, and which will continue to affect, its
margins to the extent that the Company is unable to offset the price
reductions with productivity improvements, engineering and purchasing cost
reductions, and increases in unit sales volume. In addition, profit
pressures at certain automakers are resulting in increased cost reduction
efforts by them, including requests for additional price reductions,
decontenting certain features from vehicles, and warranty cost-sharing
programs, which could adversely impact the Company's sales growth and
margins. The Company also continues to experience from time to time some
pressure for select raw material cost increases.
Automakers have been experiencing increased volatility and uncertainty in
executing planned new programs which have, in some cases, resulted in
cancellations or delays of new vehicle platforms, package reconfigurations
and inaccurate volume forecasts. This increased volatility and uncertainty
has made it more difficult for the Company to forecast future sales and
effectively utilize capital, engineering, research and development, and
human resource investments.
The Company does not have any significant off-balance sheet arrangements
or commitments that have not been recorded in its consolidated financial
statements.
On October 1, 2002, Magna International acquired Donnelly Corporation, the
Company's major competitor for sales of automatic-dimming rearview mirrors
to domestic and foreign vehicle manufacturers and their mirror suppliers.
The Company sells certain automatic-dimming rearview mirror sub-assemblies
to Magna Donnelly. To date, the Company is not aware of any significant
impact of Magna's acquisition of Donnelly upon the Company; however, any
ultimate significant impact has not yet been determined.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The information called for by this item is provided under the caption
"Trends and Developments" under Item 2 - Management's Discussion and
Analysis of Results of Operations and Financial Condition.
ITEM 4. CONTROLS AND PROCEDURES
As of September 30, 2004, an evaluation was performed under the
supervision and with the participation of the Company's management,
including the CEO and CFO, of the effectiveness of the design and
operation of the Company's disclosure controls and procedures [(as defined
in Exchange Act Rules 13a - 15(e) and 15d - 15(e)]. Based on that
evaluation, the Company's management, including the CEO and CFO, concluded
that the Company's disclosure controls and procedures were adequate and
effective as of September 30, 2004, to ensure that material information
relating to the Company would be made known to them by others within the
Company, particularly during the period in which this Form 10-Q was being
prepared. During the period covered by this quarterly report, there have
been no changes in the Company's internal controls over financial
reporting that have materially affected or are likely to materially affect
the Company's internal controls over financial reporting.
Statements in this Quarterly Report on Form 10-Q which express "belief",
"anticipation" or "expectation" as well as other statements which are not
historical fact, are forward-looking statements and involve risks and
uncertainties described under the headings "Management's Discussion and
Analysis of Results of Operations and Financial Condition" and "Trends and
Developments" that could cause actual results to differ materially from
those projected. All forward-looking statements in this Report are based
on information available to the Company on the date hereof, and the
Company assumes no obligation to update any such forward-looking
statements.
- 10 -
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) See Exhibit Index on Page 13.
- 11 -
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GENTEX CORPORATION
Date: November 2, 2004 /s/ Fred T. Bauer
---------------------------
Fred T. Bauer
Chairman and Chief
Executive Officer
Date: November 2, 2004 /s/ Enoch C. Jen
---------------------------
Enoch C. Jen
Vice President - Finance,
Principal Financial and
Accounting Officer
- 12 -
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION PAGE
- ----------- ----------- ----
3(a) Registrant's Restated Articles of Incorporation 15
3(b) Registrant's Bylaws as amended and restated February 27, 2003, were
filed as Exhibit 3(b)(1) to Registrant's Report on Form 10-Q dated
May 5, 2003, and the same are hereby incorporated herein by
reference.
4(a) A specimen form of certificate for the Registrant's common stock,
par value $.06 per share, was filed as part of a Registration
Statement on Form S-18 (Registration No. 2-74226C) as Exhibit 3(a),
as amended by Amendment No. 3 to such Registration Statement, and
the same is hereby incorporated herein by reference.
4(b) Amended and Restated Shareholder Protection Rights Agreement, dated
as of March 29, 2001, including as Exhibit A the form of Certificate
of Adoption of Resolution Establishing Series of Shares of Junior
Participating Preferred Stock of the Company, and as Exhibit B the
form of Rights Certificate and of Election to Exercise, was filed as
Exhibit 4(b) to Registrant's Report on Form 10-Q dated April 27,
2001, and the same is hereby incorporated herein by reference.
10(a)(1) A Lease dated August 15, 1981, was filed as part of a Registration
Statement on Form S-18 (Registration Number 2-74226C) as Exhibit
9(a)(1), and the same is hereby incorporated herein by reference.
10(a)(2) A First Amendment to Lease dated June 28, 1985, was filed as Exhibit
10(m) to Registrant's Report on Form 10-K dated March 18, 1986, and
the same is hereby incorporated herein by reference.
*10(b)(1) Gentex Corporation Qualified Stock Option Plan (as amended and
restated, effective February 26, 2004) was included in Registrant's
Proxy Statement dated April 6, 2004, filed with the Commission on
April 6, 2004, which is hereby incorporated herein by reference.
*10(b)(2) Specimen form of Grant Agreement for the Gentex Corporation
Qualified Stock Option Plan (as amended and restated, effective
February 26, 2004). 20
*10(b)(3) Gentex Corporation Second Restricted Stock Plan was filed as Exhibit
10(b)(2) to Registrant's Report on Form 10-Q dated April 27, 2001,
and the same is hereby incorporated herein by reference.
*10(b)(4) Specimen form of Grant Agreement for the Gentex Corporation
Restricted Stock Plan. 23
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EXHIBIT NO. DESCRIPTION PAGE
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*10(b)(5) Gentex Corporation 2002 Non-Employee Director Stock Option Plan
(adopted March 6, 2002), was filed as Exhibit 10(b)(4) to
Registrant's Report on Form 10-Q dated April 30, 2002, and the same
is incorporated herein by reference.
*10(b)(6) Specimen form of Grant Agreement for the Gentex Corporation 2002
Non-Employee Director Stock Option Plan. 26
10(e) The form of Indemnity Agreement between Registrant and each of the
Registrant's directors and certain officers was filed as Exhibit 10
(e) to Registrant's Report on Form 10-Q dated October 31, 2002, and
the same is incorporated herein by reference.
31.1 Certificate of the Chief Executive Officer of Gentex Corporation
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C.
1350). 29
31.2 Certificate of the Chief Financial Officer of Gentex Corporation
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (18 U.S.C.
1350). 30
32 Certificate of the Chief Executive Officer and Chief Financial
Officer of Gentex Corporation pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350) 31
*Indicates a compensatory plan or arrangement.
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