UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
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(Mark One) |
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended March 31, 2005 |
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OR |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from to |
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Commission file number 0-5228 |
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STRATEGIC DISTRIBUTION, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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22-1849240 |
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(State or other
jurisdiction of |
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(I. R. S. Employer |
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1414 Radcliffe Street, Suite 300, Bristol, PA |
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19007 |
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(Address of principal executive offices) |
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(Zip Code) |
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215-633-1900 |
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(Registrant’s telephone number, including area code) |
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(Former name, former address and former fiscal year, if changed since last report) |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 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 ý No o
Indicate by check mark whether registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý
Number of Common Shares outstanding at May 10, 2005: 2,958,174
TABLE OF CONTENTS
2
STRATEGIC DISTRIBUTION, INC. AND SUBSIDIARIES
(in thousands, except share data)
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March 31, |
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December 31, |
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(unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
28,873 |
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$ |
26,840 |
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Accounts receivable, net |
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15,078 |
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19,638 |
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Inventories |
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13,084 |
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12,800 |
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Prepaid expenses and other current assets |
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715 |
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426 |
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Total current assets |
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57,750 |
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59,704 |
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Office fixtures and equipment, net |
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3,156 |
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3,495 |
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Deferred income taxes |
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573 |
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573 |
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Other assets |
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15 |
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14 |
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Total assets |
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$ |
61,494 |
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$ |
63,786 |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable and accrued expenses |
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$ |
14,484 |
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$ |
15,137 |
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Total current liabilities |
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14,484 |
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15,137 |
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Stockholders’ equity: |
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Preferred stock, par value $.10 per share. Authorized: 500,000 shares; none issued and outstanding |
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— |
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— |
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Common stock, par value $.10 per share. Authorized: 20,000,000 shares; 3,094,674 issued and 2,958,174 outstanding at March 31, 2005; 3,096,174 issued and 2,959,674 outstanding at December 31, 2004 |
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309 |
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310 |
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Additional paid-in capital |
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82,183 |
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82,220 |
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Accumulated deficit |
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(33,276 |
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(31,675 |
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Treasury stock, at cost (136,500 shares) |
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(2,206 |
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(2,206 |
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Total stockholders’ equity |
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47,010 |
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48,649 |
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Total liabilities and stockholders’ equity |
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$ |
61,494 |
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$ |
63,786 |
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See accompanying notes to consolidated financial statements.
3
STRATEGIC DISTRIBUTION, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(unaudited)
(in thousands, except share data)
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Three Months Ended March 31, |
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2005 |
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2004 |
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Revenues |
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$ |
29,023 |
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$ |
32,026 |
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Costs and expenses: |
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Cost of materials |
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23,784 |
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25,567 |
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Operating wages and benefits |
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2,247 |
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2,292 |
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Other operating expenses |
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803 |
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818 |
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Selling, general and administrative expenses |
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3,828 |
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3,878 |
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Total costs and expenses |
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30,662 |
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32,555 |
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Operating loss |
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(1,639 |
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(529 |
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Interest income |
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123 |
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85 |
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Loss before income taxes |
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(1,516 |
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(444 |
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Income tax expense |
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(85 |
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(31 |
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Net loss |
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$ |
(1,601 |
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$ |
(475 |
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Net loss per common share - basic and diluted |
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$ |
(0.54 |
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$ |
(0.16 |
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Weighted average number of shares of common stock outstanding - basic and diluted |
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2,959,441 |
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2,953,301 |
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See accompanying notes to consolidated financial statements.
4
STRATEGIC DISTRIBUTION, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
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Three Months Ended March 31, |
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2005 |
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2004 |
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Cash flows from operating activities: |
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Net loss |
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$ |
(1,601 |
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$ |
(475 |
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Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
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Depreciation and amortization |
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411 |
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399 |
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Stock option income |
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(17 |
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(40 |
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Deferred income taxes |
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— |
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(40 |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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4,560 |
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(8,638 |
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Recoverable income taxes |
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— |
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585 |
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Inventories |
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(284 |
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4,892 |
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Accounts payable and accrued expenses |
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(653 |
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1,233 |
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Other, net |
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(290 |
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(374 |
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Net cash provided by (used in) operating activities |
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2,126 |
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(2,458 |
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Cash flows from investing activities: |
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Short-term investments |
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— |
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(28 |
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Additions of office fixtures and equipment |
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(72 |
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(71 |
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Net cash used in investing activities |
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(72 |
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(99 |
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Cash flows from financing activities: |
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Issuance (cancellation) of common stock |
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(1 |
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1 |
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Repurchase of common stock |
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(20 |
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— |
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Distribution to shareholders |
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— |
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(40 |
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Net cash used in financing activities |
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(21 |
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(39 |
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Increase (decrease) in cash and cash equivalents |
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2,033 |
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(2,596 |
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Cash and cash equivalents, beginning of the period |
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26,840 |
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24,787 |
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Cash and cash equivalents, end of the period |
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$ |
28,873 |
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$ |
22,191 |
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Supplemental cash flow information: |
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Taxes paid |
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$ |
85 |
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$ |
277 |
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See accompanying notes to consolidated financial statements.
5
STRATEGIC DISTRIBUTION, INC. AND SUBSIDIARIES
Notes To Consolidated Financial Statements
(unaudited)
1. Basis of Presentation
The accompanying unaudited consolidated financial statements include the accounts of Strategic Distribution, Inc. and subsidiaries (the “Company”). These financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and the instructions to Form 10-Q. In the opinion of management, all adjustments (of a normal and recurring nature) considered necessary for a fair presentation of the results of operations for the three months ended March 31, 2005 and 2004 have been included. The statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004.
2. Stock Based Compensation
The Company applies the intrinsic-value-based method of accounting prescribed by Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (“APB No. 25”), and related interpretations including Financial Accounting Standards Board (“FASB”) Interpretation No. 44, Accounting for Certain Transactions involving Stock Compensation (“FIN 44”), to account for its stock options. Under this method, compensation expense is recorded on the date of grant only if the current market price of the underlying stock exceeds the exercise price. Statement of Financial Accounting Standards (“SFAS”) No. 123, Accounting for Stock-Based Compensation and SFAS No. 148, Accounting for Stock-Based Compensation Transition and Disclosure, established accounting and disclosure requirements using a fair-value-based method of accounting for stock-based employee compensation plans. As permitted by existing accounting standards, the Company has elected to continue to apply the intrinsic-value-based method of accounting described above, and has adopted only the disclosure requirements of SFAS No. 123, as amended.
The following table illustrates the effect on net loss of each period if the fair value based method of determining stock-based employee compensation under SFAS No. 123 had been applied to all outstanding awards.
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Three Months Ended March 31, |
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2005 |
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2004 |
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(in thousands, |
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Net loss as reported |
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$ |
(1,601 |
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$ |
(475 |
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Less stock-based employee compensation income included in reported net loss, net of tax |
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(17 |
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(40 |
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Less stock-based employee compensation expense determined under the fair value method, net of tax |
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(23 |
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(6 |
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Net loss pro forma |
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$ |
(1,641 |
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$ |
(521 |
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Net loss per share (basic and diluted) as reported |
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$ |
(0.54 |
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$ |
(0.16 |
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Net loss per share (basic and diluted) pro forma |
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$ |
(0.55 |
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$ |
(0.18 |
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In December 2004, the Financial
Accounting Standards Board (FASB) issued SFAS No. 123R, “Share-Based
Payment”. This Statement is a revision of SFAS No. 123 and supersedes APB No. 25
and its related implementation guidance. SFAS No. 123R requires a company
to measure the grant-date fair value of equity awards given to employees in
exchange for services and recognize that cost over the period that such
services are performed. SFAS No. 123R is effective for the first annual
reporting period that begins after June 15, 2005. The Company is currently
evaluating the two methods of adoption allowed by SFAS No. 123R: the
modified-prospective transition method and the modified-retrospective
transition method. While the Company has not yet determined the precise impact
that this statement will have on its financial condition and results of
operations for fiscal 2006, assuming future annual stock option awards are
comparable to prior years annual awards and the Black-Scholes method is used to
compute the value of the awards, the annualized impact on diluted earnings per
share is expected to be consistent with our pro forma SFAS No. 123 disclosures.
6
3. Accounts Receivable
Accounts receivable is stated net of an allowance for doubtful accounts of $1,837,000 and $1,905,000 at March 31, 2005 and December 31, 2004, respectively.
4. Stockholders’ Equity
During the three months ended March 31, 2005, the Company repurchased and cancelled 1,500 shares of common stock at a weighted average price of $13.16 per share. During the three months ended March 31, 2004, the Company repurchased and cancelled 207 shares of common stock at a weighted average price of $7.10 per share.
5. Net Loss Per Share
Net loss per common share - basic and diluted are equal with respect to each of the three months ended March 31, 2005 and 2004, because the effect of the assumed issuance of potential shares of common stock is anti-dilutive. As of March 31, 2005 and 2004, there were stock options outstanding for approximately 104,000 and 57,000 shares of common stock, respectively.
6. Segment Information
The Company operates in one reportable segment and substantially all of its revenues are derived from the procurement, handling and data management of MRO supplies for its customers.
During the three months ended March 31, 2005 and 2004, the Company had revenues of $6,142,000 and $5,318,000, respectively, from customers in Mexico. As of March 31, 2005 and March 31, 2004 approximately 5.0% and 4.5%, respectively, of the Company’s long-lived assets were located outside of the United States.
7. Concentration Risk
The Company has a high concentration of revenue, inventory and accounts receivable attributable to a few customers. During the three months ended March 31, 2005 and 2004, 34.5% and 40.3%, respectively, of the Company’s revenues were derived from three customers. Additionally, as of March 31, 2005 and December 31, 2004 the three customers that represented the largest net inventory balances comprised 63.0% and 62.6%, respectively, of the total net inventory balance. Inventory attributable to one customer comprised 31.3% and 36.7 % of the total net inventory balance at March 31, 2005 and December 31, 2004, respectively. Three customers accounted for 34.7% of the Company’s net accounts receivable balance as of March 31, 2005, as compared to 59.0% as of December 31, 2004.
8. Related Parties
The Company obtained insurance brokerage services and incurred fees for such services totaling approximately $50,000 and $40,000 for the three months ended March 31, 2005 and 2004, respectively. The Company’s Chairman is a majority shareholder and chairman of the board of directors of the entity that wholly owns the insurance brokerage firm providing the services.
The Company has retained Willkie Farr & Gallagher LLP as its legal counsel on certain matters and incurred fees of approximately $9,000 for the three months ended March 31, 2005. The Company anticipates it will continue its relationship with the firm in the future. A member of the board of directors of the Company is the Chairman of Willkie Farr & Gallagher LLP.
7
FORWARD LOOKING STATEMENTS
Certain statements in this Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. The Company’s actual results in the future could differ significantly from the results discussed or implied in such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those related to the Company’s ability to obtain new customers and manage growth, concentration of customers and ability to retain new customers, the Company’s ability to enforce provisions of its contracts, termination of contracts, competition in the Company’s business, the Company’s dependence on key personnel and other risks described in this Form 10-Q, the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2004 and other filings made by the Company with the Securities and Exchange Commission (“SEC”). In the event of economic downturn, the Company could experience customer bankruptcies, reduced volume of business from its existing customers and lost volume due to plant shutdowns or consolidations by the Company’s customers.
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a discussion of our results of operations for the quarters ended March 31, 2005 and 2004, and our financial condition as of March 31, 2005.
General
Strategic Distribution, Inc. and subsidiaries (the “Company”) provides supply chain management services with respect to maintenance, repair and operating (“MRO”) supplies for industrial and institutional customers in the United States and Mexico. The Company conducts its U.S. operations primarily through its wholly-owned subsidiary, SDI, Inc.
During 2003, the Company entered into an agreement with a new institutional customer. However, revenue related to this agreement was not recognized until the first quarter of 2004 as a result of not meeting all of the criteria required by Staff Accounting Bulletin No. 104, Revenue Recognition. Due to the concentration of a portion of this customer’s annual sales, the Company expects a spike in sales during the third quarter of each fiscal year the customer continues to do business with the Company.
8
Results of Operations
Three Months Ended March 31, 2005 Compared to the Three Months Ended March 31, 2004
Results of operations for the three months ended March 31, 2005, compared to the three months ended March 31, 2004, were as follows:
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Three Months ended March 31, |
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2005 |
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2004 |
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Revenues |
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$ |
29,023,000 |
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$ |
32,026,000 |
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Revenues |
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100.0 |
% |
100.0 |
% |
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Costs of materials |
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81.9 |
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79.8 |
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Operating wages and benefits |
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7.7 |
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7.2 |
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Other operating expenses |
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2.8 |
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2.6 |
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Selling, general and administrative expenses |
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13.2 |
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12.1 |
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Operating loss |
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(5.6 |
) |
(1.7 |
) |
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Interest income |
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0.4 |
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0.3 |
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Income tax expense |
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(0.3 |
) |
(0.1 |
) |
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Net loss |
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(5.5 |
) |
(1.5 |
) |
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Revenues
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Three Months Ended March 31, |
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2005 |
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2004 |
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Change |
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Revenues |
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$ |
29,023,000 |
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$ |
32,026,000 |
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(9.4 |
)% |
Revenues for the three months ended March 31, 2005 decreased $3.0 million or 9.4% to $29.0 million from $32.0 million for the three months ended March 31, 2004. The $3.0 million decrease in revenues was attributable to the termination of contracts with customers during fiscal 2004 totaling $2.6 million and the impact of recognizing $5.7 million of revenue, in the first quarter of 2004, related to supplies shipped during the third quarter of 2003 and to other service fee revenue. This $5.7 million in revenue was not recognized until the first quarter of 2004 when all of the criteria of Staff Accounting Bulletin No. 104, Revenue Recognition, were met. The revenue decline was partially offset by a $5.3 million increase in revenues resulting from increases in revenues with respect to existing customers and revenues generated by new customers.
Revenue from Coors Brewing Company comprised 17.5% and 17.1% of the Company’s revenue for the three months ended March 31, 2005 and 2004, respectively.
Cost of Materials / Gross Margin
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Three Months Ended March 31, |
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2005 |
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2004 |
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Change |
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Cost of Materials |
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$ |
23,784,000 |
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$ |
25,567,000 |
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(7.0 |
)% |
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Cost of Materials% |
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81.9 |
% |
79.8 |
% |
2.1 |
% |
||
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Gross Margin% |
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18.1 |
% |
20.2 |
% |
(2.1 |
)% |
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Cost of materials as a percentage of revenues increased to 81.9% for the quarter ended March 31, 2005 from 79.8% in the first quarter of 2004. The increase in the cost of materials as a percentage of revenues was attributable to a shift in the Company’s product mix and pricing pressures in the marketplace. The Company experienced a shift in its revenue mix to revenues from customers that generated lower gross margins than the Company has historically reported, but they also, on average, report lower site operating expenses as a percentage of revenue compared to the Company’s legacy business.
9
Other
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Three Months Ended March 31, |
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2005 |
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2004 |
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Change |
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Operating Wages and Benefits |
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$ |
2,247,000 |
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$ |
2,292,000 |
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(2.0 |
)% |
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Operating Wages and Benefits% |
|
7.7 |
% |
7.2 |
% |
0.5 |
% |
||
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Other Operating Expenses |
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$ |
803,000 |
|
$ |
818,000 |
|
(1.8 |
)% |
|
Other Operating Expenses% |
|
2.8 |
% |
2.6 |
% |
0.2 |
% |
||
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Selling, General and Administrative Expenses |
|
$ |
3,828,000 |
|
$ |
3,878,000 |
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(1.3 |
)% |
|
Selling, General and Administrative Expenses% |
|
13.2 |
% |
12.1 |
% |
1.1 |
% |
||
|
Interest Income |
|
$ |
123,000 |
|
$ |
85,000 |
|
44.7 |
% |
|
Interest Income% |
|
0.4 |
% |
0.3 |
% |
0.1 |
% |
||
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Income Tax Expense |
|
$ |
85,000 |
|
$ |
31,000 |
|
174.2 |
% |
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Income Tax Expense% |
|
0.3 |
% |
0.1 |
% |
0.2 |
% |
||
Operating wages and benefits expense as a percentage of revenues increased 0.5% to 7.7% for the quarter ended March 31, 2005 from 7.2% during the same period of 2004. On a dollar basis, operating wages and benefits remained approximately the same for the three months ended March 31, 2005 compared to the same period in 2004. The increase in operating wages and benefits stated as a percentage of revenues is primarily attributable to a decline in revenues for the three months ended March 31, 2005 compared to the same period in 2004.
Other operating expenses as a percentage of revenues increased 0.2% to 2.8% for the quarter ended March 31, 2005 from 2.6% for the quarter ended March 31, 2004. The increase is primarily related to the impact of certain fixed costs, such as depreciation of the Company’s enterprise resource planning system, on a lower revenue base.
Selling, general and administrative expenses as a percentage of revenues increased to 13.2% for the quarter ended March 31, 2005 from 12.1% for the quarter ended March 31, 2004. On a dollar basis, selling, general and administrative costs remained approximately the same for the three months ended March 31, 2005 compared to the same period in 2004. The first quarter 2005 selling, general and administrative expense included approximately $350,000 of severance expense and increases in temporary labor costs. The Company’s ability to maintain or decrease the selling, general and administrative expenses as a percentage of revenues is highly dependent upon the Company’s ability to expand its revenue base. Management believes the current cost structure of the Company will enable future growth. Potential cost reductions, if taken, could potentially inhibit that growth.
Interest income was $123,000 for the quarter ended March 31, 2005 compared to interest income of $85,000 for the comparable period in 2004. During the three months ended March 31, 2005, the average monthly cash balance was approximately $4.0 million higher than the same comparable period of 2004.
Income tax expense was $85,000 for the quarter ended March 31, 2005 compared to income tax expense of $31,000 for the comparable period in 2004. There was no tax expense recorded for the Company’s U.S. operations for the quarter ended March 31, 2005 and 2004 as a result of the net losses incurred. The realization of income tax benefits from such losses is dependent on future events that are not currently deemed more likely than not to occur.
Net loss for the quarter ended March 31, 2005 was $1.6 million compared to a net loss of $475,000 in the same period of 2004, as a result of the operating results previously discussed.
Liquidity and Capital Resources
As of March 31, 2005, the Company had $28.9 million of cash and cash equivalents. The Company believes that cash on hand and the ability to enter into a new credit facility, if deemed appropriate, will provide sufficient funds to permit the Company to support its operations.
Net cash provided by operating activities was $2.1 million for the quarter ended March 31, 2005 compared to net cash used in operating activities of $2.5 million for the quarter ended March 31, 2004. The improvement in cash flow from operations was due to the Company’s new business model and the timing of collection of the Company’s accounts receivables. In the new business model working capital requirements result in higher accounts receivable rather than investment in inventory. The timing of the collections of these accounts receivable improved cash by $4.6 million.
10
Net cash used in investing activities was $72,000 for the quarter ended March 31, 2005 compared to $99,000 during the quarter ended March 31, 2004. During the first quarter of 2005, the Company made purchases of computer systems and related equipment.
Net cash used in financing activities was $21,000 for the quarter ended March 31, 2005 compared to $39,000 during the first quarter of 2004. During the first quarter of 2005, the Company used $20,000 to repurchase and cancel shares of common stock. During the first quarter of 2004, the Company used $40,000 to pay previously undistributed amounts in connection with its 2003 distribution to shareholders of $5.00 per common share.
Off-balance Sheet Arrangements
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, results of operations, or cash flows that are material to its investors.
Inflation
The Company believes that any impact of general inflation has not had a material effect on its results of operations. The Company’s current policy is to attempt to reduce any impact of inflation through price increases and cost reductions.
Seasonality
During 2003, the Company entered into an agreement with a new institutional customer. However, revenue related to this agreement was not recognized until the first quarter of 2004 as a result of not meeting all of the criteria required by Staff Accounting Bulletin No. 104, Revenue Recognition. Due to the concentration of a portion of this customer’s annual sales, the Company expects a spike in sales during the third quarter of each fiscal year the customer continues to do business with the Company.
Recently Issued Accounting Standards
In December 2004, the Financial Accounting Standards Board (FASB) issued SFAS No. 123R, “Share-Based Payment”. This Statement is a revision of SFAS No. 123 and supersedes APB No. 25 and its related implementation guidance. SFAS No. 123R requires a company to measure the grant-date fair value of equity awards given to employees in exchange for services and recognize that cost over the period that such services are performed. SFAS No. 123R is effective for the first annual reporting period that begins after June 15, 2005. The Company is currently evaluating the two methods of adoption allowed by SFAS No. 123R: the modified-prospective transition method and the modified-retrospective transition method. While the Company has not yet determined the precise impact that this statement will have on its financial condition and results of operations for fiscal 2006, assuming future annual stock option awards are comparable to prior years annual awards and the Black-Scholes method is used to compute the value of the awards, the annualized impact on diluted earnings per share is expected to be consistent with our pro forma SFAS No. 123 disclosures.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company’s exposure to market risk is generally limited to changes in interest rates related to funds available for investment, which are tied to variable market rates. The Company does not have any exposure to market risk associated with activities in derivative financial instruments, other financial instruments or derivative commodity instruments. If market interest rates were to increase by 10% from rates as of March 31, 2005 the effect would not be material to the Company.
The Company provides the In-Plant Store program in Mexico through two subsidiaries (collectively “Mexico”). Mexico’s operations are conducted primarily in U.S. dollars, its functional currency, and therefore, the Company is not exposed to any significant foreign currency fluctuations and has no foreign currency translation adjustments.
Item 4. CONTROLS AND PROCEDURES
(A) Evaluation of Disclosure Controls and Procedures
The Company maintains a system of disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in the Company’s reports filed or submitted pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the rules
11
and forms of the Securities and Exchange Commission. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. The Company carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective at March 31, 2005.
(B) Changes in Internal Control Over Financial Reporting
There have not been any changes in the Company’s internal control over financial reporting during the Company’s first fiscal quarter of 2005 that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.
12
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
(c) Issuer Purchases of Equity Securities
On May 19, 2004, the Board of Directors renewed the Company’s stock repurchase program originally adopted in February 2001. Under the program, the Company may acquire up to 1,000,000 shares of Company common stock, which is approximately 33% of the shares outstanding, through June 3, 2005. These purchases may be commenced or suspended without prior notice depending on then-existing business or market conditions and other factors. During the quarter ended March 31, 2005, the Company did not make any purchases under the program. The Company did, however, repurchase from a former employee and cancel 1,500 shares of Common Stock during the period as further described in the following chart.
|
Period |
|
(a) |
|
(b) |
|
(c) |
|
(d) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 1 - January 30 |
|
— |
|
— |
|
— |
|
909,424 |
|
|
|
January 31 - March 1 |
|
— |
|
— |
|
— |
|
909,424 |
|
|
|
March 2 - March 31 |
|
1,500 |
|
$ |
13.16 |
|
— |
|
909,424 |
|
|
Total |
|
1,500 |
|
$ |
13.16 |
|
— |
|
909,424 |
|
Item 6. EXHIBITS
|
3.1 |
|
Second Restated Certificate of Incorporation of the Company filed June 21, 1996 with the Secretary of State of the State of Delaware (incorporated by reference to Exhibit 3.1 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001). |
|
|
|
|
|
3.2 |
|
Certificate of Amendment to Second Restated Certificate of Incorporation of the Company filed May 16, 2001 with the Secretary of State of the State of Delaware (incorporated by reference to Exhibit 3.2 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001). |
|
|
|
|
|
3.3 |
|
Amended and Restated Bylaws of the Company, dated July 24, 1986, as amended (incorporated by reference to Exhibit 3.3 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001). |
|
|
|
|
|
10.1 |
|
Employment Letter, dated as of May 10, 2005, between Strategic Distribution, Inc. and Philip D. Flynt. |
|
|
|
|
|
31.1 |
|
Certification by the Company’s Chief Executive Officer pursuant to 13a-14(a) under the Securities Exchange Act of 1934 as amended. |
|
|
|
|
|
31.2 |
|
Certification by the Company’s Chief Financial Officer pursuant to 13a-14(a) under the Securities Exchange Act of 1934 as amended. |
|
|
|
|
|
32.1 |
|
Certification by the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
|
32.2 |
|
Certification by the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
13
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.
|
|
|
|
Strategic Distribution, Inc. |
||
|
|
|
|
|
||
|
|
|
|
|
||
|
Date: |
May16, 2005 |
|
By: |
/s/ Donald C. Woodring |
|
|
|
|
|
|
Donald C. Woodring, |
|
|
|
|
|
|
President and Chief |
|
|
|
|
|
|
Executive Officer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date: |
May 16, 2005 |
|
By: |
/s/ Richard S. Martin |
|
|
|
|
|
|
Richard S. Martin, |
|
|
|
|
|
|
Vice President and |
|
|
|
|
|
|
Chief Financial Officer |
|
14
EXHIBIT INDEX
|
3.1 |
|
Second Restated Certificate of Incorporation of the Company filed June 21, 1996 with the Secretary of State of the State of Delaware (incorporated by reference to Exhibit 3.1 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001). |
|
|
|
|
|
3.2 |
|
Certificate of Amendment to Second Restated Certificate of Incorporation of the Company filed May 16, 2001 with the Secretary of State of the State of Delaware (incorporated by reference to Exhibit 3.2 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001). |
|
|
|
|
|
3.3 |
|
Amended and Restated Bylaws of the Company, dated July 24, 1986, as amended (incorporated by reference to Exhibit 3.3 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001). |
|
|
|
|
|
10.1 |
|
Employment Letter, dated as of May 10, 2005, between Strategic Distribution, Inc. and Philip D. Flynt. |
|
|
|
|
|
31.1 |
|
Certification by the Company’s Chief Executive Officer pursuant to 13a-14(a) under the Securities Exchange Act of 1934 as amended. |
|
|
|
|
|
31.2 |
|
Certification by the Company’s Chief Financial Officer pursuant to 13a-14(a) under the Securities Exchange Act of 1934 as amended |
|
|
|
|
|
32.1 |
|
Certification by the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
|
32.2 |
|
Certification by the Company’s Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
15