SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 10-K

 

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

 

For the fiscal year ended April 30, 2014

 

Commission File No. 1-5926

 

MILLER INDUSTRIES, INC. (Exact Name Registrant as specified in its charter)

 

Florida		59-0996356
(State or Other Jurisdiction of		(I.R.S. Employer
(incorporation or organization)		Identification No.)

 

16295 N.W. 13th Avenue, Miami,  Florida  33169

(Address of Principal Executive Offices)

(305) 621-0501

(Registrant’s Telephone Number, Including Area Code)

 

Securities registered under Section 12(b)

of the Exchange Act: None

 

Securities registered under Section 12(g) of the Exchange Act:

 

	Common Stock, $.05 Par Value
	(Title of Class)

 

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

 

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

 

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 ¨ No x

 

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

 

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

 

Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company x

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Yes ¨ No x

 

The aggregate market value of the common stock held by non-affiliates of the registrant at April 30, 2014 was $555,421.

 

As of April 30, 2014, there were 5,000,000 shares of the registrant’s common stock outstanding.

 

 

PART I

 

FORWARD LOOKING STATEMENTS

 

This Form 10-K contains “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward looking statements represent the Company’s expectations and beliefs including, but not limited to, statements concerning the Company’s operations, performance, financial condition, growth or strategies. For this purpose, any statements contained in this Form 10-K that are not statements of historical fact may be deemed to be forward looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “estimate,” “anticipate” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward looking statements. The statements by their nature involve substantial risks and uncertainties, certain of which are beyond the Company’s control, and actual results may differ materially depending on a variety of important factors, including but not limited to the potential impact of changes in interest rates, competition, credit risks and collateral, changes in local or regional economic conditions, the ability of the Company to continue its growth strategy, dependence on management and key personnel, and regulatory supervision.

 

ITEM 1.          BUSINESS

 

General

 

Miller Industries, Inc. (the “Company”) was incorporated under the laws of the State of Florida on January 21, 1963. The administrative offices of the Company are located at 16295 N.W. 13th Avenue, Miami, Florida 33169, and its telephone number is (305) 621-0501.

 

The Company’s business is the ownership and management of a 98,000 square feet warehouse located in Miami, Florida.

 

Employees

 

The Company had no employees during the 2014 and 2013 fiscal years.

 

The Company utilizes an independent contractor to perform administrative and bookkeeping services.

 

ITEM 2.          PROPERTIES

 

Description of Warehouse

 

The Company owns a one-story concrete block building located at 16295 N.W. 13th Avenue, Miami, Florida. This facility consists of 97,813 square feet, 7,000 of which are air-conditioned. The building is zoned for use as a warehouse or light manufacturing facility. The building has a relatively low ceiling, which has adversely affected leasing efforts.

 

 

Financing

 

At April 30, 2014, the building was subject to an outstanding first mortgage in favor of a commercial bank with a principal balance of approximately $1,160,000. The loan accrues interest at ½% under the lender’s base rate per annum and is payable in monthly installments of $3,715, with a balloon payment of $911,000 due November 2019. The loan is secured by the Company’s land and building and a partial guarantee of the Company’s president.

 

Leasing Activities

 

The Company continues to seek long term commercial tenants for its building. The building is located in an industrial park which contains many similar facilities. Current rents for such facilities range from approximately $4.00 per square foot to approximately $7.50 per square foot and the occupancy rate in the area is approximately 80%.

 

During 2014, the Company leased its building to three tenants. As of April 30, 2014, the future minimum rental income under these leases, excluding cost of living adjustments, was as follows:

 

2015		$	465,000
2016		$	470,000
2017		$	395,000
2018		$	245,000
2019		$	245,000
2020		$	61,000

 

Insurance, Depreciation and Taxes

 

The Company believes that the building is adequately insured. Depreciation is determined using the straight-line method over five to 31.5 years for tax purposes and 5 to 30 years for accounting purposes. Real estate taxes paid for calendar year 2014 were approximately $52,000.

 

ITEM 3.          LEGAL PROCEEDINGS

 

Gold Coast Oil

 

In 1981, the Company was named by the U.S. Environmental Protection Agency (“EPA”) as one of many potential PRPs with respect to chemical pollution discovered at a site known as “Gold Coast Oil.”

 

In 1988, a settlement was negotiated between the EPA and certain PRPs including the Company, which resulted in a settlement of the EPA claim. The PRPs subsequently negotiated a settlement among themselves in which the Company agreed to pay $50,000 of the anticipated clean up costs. The Company’s insurance carrier at the time of the alleged violations agreed to pay $45,000 of this amount in return for a release from any future additional claims.

 

 

In January 1993, it was determined that additional funds would be required to complete the clean up of the Gold Coast Oil site. The Company received an assessment of $10,000 for this obligation and has included such amount in accrued expenses in the accompanying balance sheets.

 

ITEM 4.          MINE SAFETY DISCLOSURES

 

Not Applicable.

 

 

PART II

 

ITEM 5.          MARKET FOR THE REGISTRANT’S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

 

The Company’s common stock is currently traded on the over-the-counter market under the symbol “MLLS”.

 

The range of the high and low bid quotations for each quarter of the past two (2) fiscal years is as follows:

 

		CLOSING BID
2013 Fiscal Year		HIGH				LOW
05/1/12  -  07/31/12		$	.17			$	.14
08/1/12  -  10/31/12		$	.17			$	.14
11/1/12  -  01/31/13		$	.18			$	.14
02/01/13  -  04/30/13		$	.19			$	.17

 

		CLOSING BID
2014 Fiscal Year		HIGH				LOW
05/1/13  -  07/31/13		$	.04			$	.04
08/1/13  -  10/31/13		$	.04			$	.04
11/1/14  -  01/31/14		$	.04			$	.04
02/01/14  -  04/30/14		$	.16			$	.30

 

As of April 30, 2014, there were approximately 475 holders of record of the Company’s common stock.

 

The Company has not paid any cash dividends during the last three fiscal years.

 

 

Equity Compensation Plan Information

 

On April 30, 2014, the Company had no equity compensation plans.

 

ITEM 6.          SELECTED FINANCIAL DATA

 

Not Applicable.

 

ITEM 7.          MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Results of Operations (2014 compared to 2013)

 

Rental Income

 

The Company’s results of operations are primarily dependant upon the rental income which it receives from leasing space in its building. Rental income is a function of the percentage of the building which is occupied, and the level of rental rates. Rental income during 2013 was $332,000, compared with $314,000 in 2014. The decrease in rental income was due to lower rental rates.

 

Hardware Sales

 

The Company receives revenue from the sale of replacement parts for the sliding glass doors and windows formerly manufactured by the Company. These sales (net of cost of goods sold) were immaterial in 2013 and 2014.

 

Other Income

 

The Company generated other income of $6,000 in 2013 and $10,000 in 2014. Other income principally consisted of interest income. The decrease was due to lower interest rates in the Company’s deposits.

 

Rental Expense (Excluding Interest)

 

The Company incurs rental expense in connection with the leasing of its building. These expenses consist of management fees, insurance, real estate taxes, depreciation and amortization, insurance, maintenance and repairs, utility costs and outside services. Rental expenses were $166,000 in 2013 and $220,000 in 2014. The principal components were management fees ($36,000 in 2013 and $44,000 in 2014), taxes ($64,000 in 2013 and $52,000 in 2014), depreciation and amortization ($18,000 in 2013 and $22,000 in 2014), repairs and maintenance ($16,000 in 2013 and $51,000 in 2014), and insurance ($31,000 in 2011 and $30,000 in 2014.

 

Cost of Hardware Sales

 

The Company records the cost of its hardware sales in connection with the sale of replacement parts to customers of its former window and sliding glass door business. These costs are tied to the level of hardware sales. These costs were not material in 2013 and 2014.

 

 

Administrative Expenses

 

The Company’s administrative expenses were $62,000 in 2013, compared to $57,000 in 2014.

 

Interest Expense

 

The Company pays interest on the mortgage loan on its building. Interest expense on the loan was $35,000 in 2013 compared to $33,000 in 2014.

 

Provision for Income Taxes

 

The provision for taxes (before realization of prior years’ tax benefits) was $16,000 in 2013 and $2,000 in 2014. The Company also recorded a change in its valuation allowance in 2013 related to its net operation loss carryforwards due to the decrease in the Company’s profitability. See Note C to the Company’s financial statements.

 

Net Income

 

As a result of the foregoing factors, the Company had a net income of $53,000 in 2013, compared to a net income of $12,000 in 2014.

 

Liquidity and Capital Resources

 

The Company’s cash decreased by $3,000 during fiscal year 2013 compared with a decrease of $94,000 during fiscal year 2014. The decrease in 2014 was primarily due to lower net income, the pay down of accounts payable and increased repairs and maintenance expenses of the building. As of April 30, 2014, the Company’s cash position was approximately $1,513,000.

 

At April 30, 2014, the Company’s principal financing consisted of a loan with a principal balance of approximately $1,160,000 from a third party lender, secured by a lien on the Company’s building. The loan bears interest at 50 basis points below the Lender’s base rate. The loan is payable $3,715 per month (plus accrued interest), with a balloon payment due November 2019 in the approximate amount of $911,000. The note is collateralized by the Company’s land and building, along with the personal guaranty of the Company’s Chairman of the Board in the amount of 50% of the mortgage balance.

 

The Company believes that its working capital needs over the next twelve months will principally consist of funding routine maintenance of its building and alterations to the interior of the building to accommodate new tenants. The Company believes that its existing cash reserves will allow the Company to continue operations at their current level for at least 12 more months. However, the Company’s long term prospects ultimately depend on the Company’s ability to lease the space in its building at attractive rates.

 

The Company’s obligations to make payments under existing, material contracts consist of the following:

 

 

·

The Company is obligated to make payments under its existing mortgage loan. At April 30, 2014, the outstanding balance of the loan was $1,160,080. The loan bears interest 50 basis points below the Lender’s base rate. The loan is repayable in monthly installments of approximately $3,715, with a balloon payment of approximately $911,000 due in November 2019.

 

·

The Company has agreed to pay Harnap Corp., a corporation controlled by the Company’s president and principal shareholder, $44,000 per year for management fees. Accrued fees as of April 30, 2014 were $50,000, all of which are payable upon the demand of Harnap.

 

Current Plans

 

The Company operates as a real estate investment and management company. The Company currently is seeking to obtain additional commercial tenants.

 

The Company’s principal operating expenses consist of management and professional fees associated with the administration of the Company, interest expense on the Company’s mortgage loan, real estate taxes and insurance.

 

Critical Accounting Policies

 

The Securities and Exchange Commission (“SEC”) has issued disclosure guidance for “Critical Accounting Policies.” The SEC defines critical accounting policies as those that require the application of management’s most difficult, subjective, or complex judgments, often because of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods.

 

The discussion and analysis of the Company’s financial condition and results of operations are based upon its financial statements, the preparation of which takes into account estimates based on judgments and assumptions that affect certain amounts and disclosures. Accordingly, actual results could differ from these estimates. The accounting policies and estimates used and outlined in Note 1 to the Company’s financial statements, which are presented elsewhere in this Form 10-K, have been applied consistently as at April 30, 2013 and 2014, and for the years ended April 30, 2013 and 2014. The Company’s representatives who are involved in the preparation of its financial statements and this report believe that the following accounting policies represent the Company’s critical accounting policies:

 

Valuation of Long-Lived Assets: The Company periodically assesses the carrying value of long-lived assets whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. When the Company determines that the carrying value of long-lived assets may be impaired, the measurement of any impairment is based on a projected discounted cash flows method. While the Company believes that this method is reasonable, different assumptions regarding such cash flows may significantly affect the measurement of impairment.

 

 

Revenue Recognition: Rental income is recognized when it becomes receivable under the terms of each lease. Hardware sales are recognized upon receipt of payment from customers.

 

Off-Balance Sheet Arrangements and Aggregate Contractual Obligations

 

The Company is not a party to any material off-balance sheet arrangements.

 

The following is a summary of the Company’s contractual obligations, including certain on-balance sheet obligations, at April 30, 2014:

 

						Payments Due by Period
Contractual Obligations		Total				Less Than 1 Year				1-3 Years				4-5 Years
Long Term Debt		$	1,160,080			$	44,580			$	89,160			$	1,026,340
Capital Lease Obligations			-				-				-				-
Operating Leases			-				-				-				-
Purchase Obligations			-				-				-				-
Other Long Term Debt
TOTAL		$	1,160,080			$	44,580			$	89,160			$	1,026,340

 

ITEM 8.          FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 

The Company’s financial statements and supplementary financial schedules are attached as an exhibit to this report. See Items 14(a) and 14(b).

 

Management’s Report on the Consolidated Financial Statements

 

Our management is responsible for the preparation of the consolidated financial statements and related information that are presented in this report. The consolidated financial statements, which include amounts based on management’s estimates and judgments, have been prepared in conformity with accounting principles generally accepted in the United States of America. The Company designs and maintains accounting and internal control systems to provide reasonable assurance at reasonable cost that assets are safeguarded against loss from unauthorized use or disposition, and that the financial records are reliable for preparing financial statements and maintaining accountability for assets. These systems are augmented by written policies, an organizational structure providing division of responsibilities and careful selection and training of qualified personnel.

 

ITEM 9.          CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 

None.

 

 

ITEM 9A.           CONTROLS AND PROCEDURES

 

Disclosure Controls and Procedures

 

In connection with the filing of this Form 10-K, the Company’s Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of the Company’s disclosure controls and procedures as of April 30, 2014. The Company’s Chief Executive Officer and Chief Executive Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of April 30, 2014.

 

Management's Report on Internal Control Over Financial Reporting

 

The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). The Company designs and maintains accounting and internal control systems to provide reasonable assurance at reasonable cost that assets are safeguarded against loss from unauthorized use or disposition, and that the financial records are reliable for preparing financial statements and maintaining accountability for assets. These systems are augmented by written policies, an organizational structure providing division of responsibilities and careful selection and training of qualified personnel.

 

Management (with the participation of the Company's principal executive officer and principal financial officer) has evaluated the Company's internal control over financial reporting as of April 30, 2014, based on the framework in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission.

 

There are limitations inherent in any internal control, such as the possibility of human error and the circumvention or overriding of controls. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met, and may not prevent or detect misstatements. As conditions change over time, so too may the effectiveness of internal controls. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of a Company's financial reporting.

 

Based on its assessment, management has concluded that our internal control over financial reporting was effective as of April 30, 2014.

 

There were no changes in the Company’s internal controls over financial reporting that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting during the fiscal quarter ended April 30, 2014.

 

ITEM 9B.           OTHER INFORMATION

 

Not applicable

 

 

PART III

 

ITEM 10.         DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

 

The directors and executive officers of the Company are as follows:

 

Name		Position		Officer Since		Director Since
Angelo Napolitano		President, Chief Executive Officer, and Chairman of the Board of Directors		1992		1988

 

Each director is elected for a period of one year, or until his successor is duly elected by the shareholders. Officers serve at the will of the Board of Directors.

 

Angelo Napolitano, age 79 has been President and Chief Executive Officer of the Company since 1992. He has been a Director of the Company since 1988 and Chairman since July 1989. Mr. Napolitano is the Chairman and Chief Executive Officer of Harnap Corp., a commercial real estate management company which he founded in 1971. Since 1975, Mr. Napolitano has served as a director and President of Sunshine State Industrial Park Authority, the property owners’ association for the industrial park in which the Company’s building is located.

 

Compliance with Section 16(a) of the Securities Exchange Act of 1934

 

Based solely upon a review of Forms 3, 4 and 5 furnished to the Company, Mr. Napolitano failed to file one report on a timely basis.

 

Audit Committee Financial Expert

 

The Company has determined that it does not have an audit committee financial expert. The Company has not been able to identify an individual willing to serve as an audit committee financial expert for the Company.

 

Code of Ethics

 

The Company has adopted a code of ethics that applies to the Company’s officers and persons performing similar functions.

 

ITEM 11.         EXECUTIVE COMPENSATION

 

The following table sets forth information regarding the compensation paid by the Company to the Company’s chief executive officer. None of the Company’s officers in fiscal 2014 received compensation in excess of $100,000.

 

 

SUMMARY COMPENSATION TABLE

 

Name and Position		Fiscal Year				Salary (1)				Shares Underlying Stock Options Grant
Angelo Napolitano, Chief Executive Officer			2014			$	44,000
			2013			$	36,000				-
			2012			$	36,000				-

 

(1)         Includes management fees paid to Harnap Corp., a company controlled by Mr. Napolitano, and director fees paid to Mr. Napolitano.

 

Stock Options

 

No stock options were granted, outstanding, or exercised during the 2014 fiscal year.

 

Management Agreement

 

The Company has agreed to pay Harnap Corp. an annual management fee, which is currently $44,000 per year. Harnap Corp. is owned and controlled by Angelo Napolitano, the Company’s Chief Executive Officer and Chairman of the Board. As of April 30, 2014, accrued management fees totaled $50,000.

 

Compensation of Directors

 

No amounts were paid to directors during the 2014 fiscal year for services as directors.

 

ITEM 12.         SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

To the knowledge of management, as of April 30, 2014, the following persons beneficially owned 5% or more of the common stock of the Company:

 

Name and Address of Beneficial Owner		Amount Beneficially Owned				Percent Of Class
Angelo Napolitano 1521 N.W. 165th Street Miami, FL 33169			3,148,594	(1)			63.0	%

 

(1)         Mr. Napolitano has sole voting and investment power with respect to 1,121,256 shares which he holds of record, and 500,000 shares which are held in trusts controlled by Mr. Napolitano as the trustee. Mr. Napolitano has shared voting and investment power with respect to 10,000 shares which he owns jointly with his wife, Mrs. Helen Napolitano.

 

 

The shares of common stock beneficially owned by the Company’s sole director and executive officer as of April 30, 2014 were as follows:

 

Name and Address of Beneficial Owner		Amount Beneficially Owned (1)				Percent Of Class
Angelo Napolitano 1521 N.W. 165th Street Miami, FL 33169			3,148,594	(2)			63.0	%(2)

 

(1)         Except as otherwise indicated, each person has sole voting and investment power as to the listed shares.

 

(2)         With respect to Mr. Napolitano’s shares, see Note (1) to the preceding table.

 

 

ITEM 13.         CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

The Company has entered into a brokerage agreement with Napolitano Realty Corporation (“NRC”) with respect to the lease of the Company’s building. The President of NRC is the son of Mr. Angelo Napolitano, the Company’s President and Chairman of the Board. The agreement provides for a 6% commission to be paid to NRC on sales or lease proceeds received by the Company. No commissions were paid under this agreement for the 2014 fiscal year.

 

ITEM 14.         PRINCIPAL ACCOUNTANT FEES AND SERVICES

 

Larry Wolfe, CPA performed the review of each of the Company’s quarterly reports for the 2014 fiscal year and the audit of the Company’s financial statements for the year ended April 30, 2014.

 

The following table presents fees billed for professional audit and other services rendered by Larry Wolfe, CPA for the periods presented.

 

		Fiscal 2014				Fiscal 2013
Fees billed by Larry Wolfe, CPA
Audit Fees		$	12,750			$	12,200
Audit Related Fees			4,250				4,600
Tax Fees			800				800
All Other Fees			-				-
Total		$	17,800			$	18,100

 

(1)         Audit Fees consist of fees billed for professional services rendered for the audit of the Company’s consolidated annual financial statements and review of the interim consolidated financial statements included in quarterly reports and services normally provided in connection with statutory and regulatory filings or engagements.

 

(2)         Audit-Related Fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s consolidated financial statements and are not reported under “Audit Fees,” including registration statement filings.

 

(3)         Tax Fees consist of fees billed for professional services rendered for tax compliance, tax consultation and tax planning (domestic and international). These services include assistance regarding federal, state and international tax compliance and international tax planning.

 

(4)         All Other Fees consist of fees for products and services other than the services reported above.

 

 

PART IV

 

ITEM 15.              EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 10-K

 

(a)          Financial Statements

 

Report of Independent Certified Public Accountants

 

Balance Sheets as of April 30, 2014 and 2013

 

Statements of Operations for Years ended April 30, 2014 and 2013.

 

Statements of Changes in Shareholders’ Equity (Deficiency) for Years ended April 30, 2014 and 2013

 

Statements of Cash Flows for Years ended April 30, 2014 and 2013

 

Notes to Financial Statements

 

(b)          All schedules have been omitted because they are inapplicable, not required or the information is included elsewhere in the financial statements or notes thereto.

 

(c)          Exhibits

 

3.1		Articles of Incorporation		(Note 1)
3.2		Articles of Amendment		(Note 2)
3.3		By-laws		(Note 1)
3.4		Amendment to By-laws – Indemnification		(Note 1)
3.5		Amendment to By-laws —Control Share Acquisitions		(Note 3)
10.1		Indemnification Agreement with Directors		(Note 4)
14.1		Code of Ethics		(Note 6)
31.1*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)
31.2*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)
32.1*		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted by Section 906 of Sarbanes-Oxley Act of 2002
Note 1		Incorporated by reference from the Form 10-K filed with the Commission for the year ended April 30, 1981.
Note 2		Incorporated by reference from Form 10-K filed with the Commission for the year ended April 30, 1985.
Note 3		Incorporated by reference from the Form 10-K filed with the Commission for the year ended April 30, 1993.
Note 4		Incorporated by reference from the Form 10-K filed with the Commission for the year ended April 30, 1990.

 

 

Note 5		Incorporated by reference from the Form 10-K filed with the Commission for the fiscal year ended April 30, 2010.
Note 6		Incorporated by reference from the Form 10-KSB filed with the Commission for the fiscal year ended April 30, 2004.
(*)		Filed as part of this report

 

(d)          Reports on Form 8-K

 

There were no reports on Form 8-K for the three months ended April 30, 2014.

 

 

SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereto duly authorized on May 26, 2015.

 

	MILLER INDUSTRIES, INC.
	/s/  Angelo Napolitano
	By:	Angelo Napolitano, President And Chief Executive Officer

 

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on May 26, 2015.

 

Signature		Title
/s/ Angelo Napolitano		President, Chief Executive
Angelo Napolitano		Officer, and Director (Principal Executive Officer) (Principal Financial Officer) (Principal Accounting Officer)

 

 

INDEPENDENT AUDITOR’S REPORT

 

Shareholders and Board of Directors

Miller Industries, Inc.

Miami, Florida

 

I have audited the accompanying balance sheets of Miller Industries, Inc. as of April 30, 2014 and 2013, and the related statements of operations, shareholders’ deficiency, and cash flows for each of the two years in the period ended April 30, 2014. These financial statements are the responsibility of the Company’s management. My responsibility is to express an opinion on these financial statements based on my audits.

 

I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor was I engaged to perform, an audit of its internal control over financial reporting. My audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, I express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion.

 

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Miller Industries, Inc. as of April 30, 2014 and 2013 and the results of its operations and its cash flows for each of the two years in the period ended April 30, 2014, in conformity with accounting principles generally accepted in the United States of America.

 

	/s/ Larry Wolfe
	LARRY WOLFE
	Certified Public Accountant

 

Miami, Florida

November 12, 2014

 

 

MILLER INDUSTRIES, INC.

BALANCE SHEET

APRIL 30, 2014 AND 2013

 

		2014				2013
ASSETS
Investment Property:
Land		$	161,443			$	161,443
Building and Improvements			1,049,908				1,049,908
Machinery and Equipment			11,106				11,106
Furniture and Fixtures			10,251				10,251
Total Cost		$	1,232,708			$	1,232,708
Less:  Accumulated Depreciation			930,164				918,279
Net Book Value		$	302,544			$	314,429
Other Assets:
Cash and Cash Equivalents		$	1,512,931			$	1,606,404
Accounts Receivable ( Less Allowance for Doubtful Accounts of $0 in 2014 and $0 in 2013)							855
Prepaid Expenses and Other Assets			45,525				13,005
Refundable Income Taxes			11,563
Deferred Lease Incentive (Net of Accumulated Amortization - $ 25,337 in 2014 and $16,504 in 2013.)			29,886				6,577
Loan Costs, (Less Accumulated Amortization of $4,741 and $3,668 in 2014 and 2013, respectively			5,994				7,067
Deferred Tax Assets			40,376				39.993
Total Other Assets		$	1,646,275			$	1,673,901
TOTAL ASSETS		$	1,948,819			$	1,988,330
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Mortgage and Notes Payable		$	1,160,080			$	1,204,660
Accounts Payable and Accrued Expenses			212,387				242,060
Tenant's Deposits and Advance Rent			63,080				24,054
Income Taxes Payable							16,072
Total Liabilities		$	1,435,547			$	1,486,846
Shareholders’ Equity:
Common Stock - $.05 par, 5,000,000 shares Authorized; 5,000,000 shares in 2014 and 2013		$	250,000			$	250,000
Paid-In Capital			1,212,102				1,212,102
Deficit			(948,830	)			(960,618	)
Total Shareholders’ Equity		$	513,272			$	501,484
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	1,948,819			$	1,988,330

 

See Accompanying Notes to Financial Statements.

 

 

MILLER INDUSTRIES, INC.

STATEMENT OF OPERATIONS

YEARS ENDED APRIL 30, 2014 AND 2013

 

		2014				2013
Revenues:
Rental Income (Net of Allowance of $16,087)		$	314,463			$	331,686
Other Income			9,521				5,607
Total Revenues		$	323,984			$	337,293
Expenses:
Rental Expenses (Except Interest)		$	220,329			$	166,827
Cost of Hardware Sales			-				-
Administrative			56,575				61,991
Interest			33,138				34,515
Total Expenses		$	310,042			$	263,333
Income Before Tax Provision		$	13,942			$	73,960
Provision (Benefit) for Income Tax:
Federal Income Tax		$	2,154			$	12,585
State Income Tax							3,803
Provision for Income Tax Before Realization of Prior Years' Tax Benefit, Adjustments and Change in valuation allowance		$	2,154			$	16,388
Tax Benefits of Net Operating Loss Carryforward, Adjustments and Change in Valuation Allowance							4,988
Total Provision for Income Tax (Net of Tax Benefits), Adjustments and Change in Valuation Allowance		$	2,154			$	21,376
Net Income		$	11,788			$	52,584
Income per Common Share (Basic)		$	.00			$	.01
Weighted Average Shares of Common Stock Outstanding (Basic)			5,000,000				5,000,000

 

See Accompanying Notes to Financial Statements.

 

 

MILLER INDUSTRIES, INC.

STATEMENT OF CASH FLOWS

YEARS ENDED APRIL 30, 2014 AND 2013

 

		2014				2013
Cash Flows from Operating Activities:
Net Income (Loss)		$	11,788			$	52,584
Adjustments to Reconcile Net Income to Net Cash Provided by (used for) Operating Activities:
Depreciation			11,885				11,885
Amortization			9,906				6,335
Deferred Tax Asset Valuation Adjustment			(383	)			5,305
Bad Debt Provision
Changes in Operating Assets and Liabilities
(Increase) Decrease in Accounts Receivable			855				350
(Increase) Decrease in Prepaid Expenses and Other			(44,083	)			(800	)
Increase (Decrease) in Accounts Payable and Accruals and Income Taxes			(45,746	)			(8,736	)
Increase (Decrease) in Tenants Deposits And Advances			(39,026	)			(25,396	)
Net Cash Provided by (used by) Operating Activities		$	(16,752	)		$	41,527
Cash Flows from Investing Activities:
Acquisition of Property, Equipment, and Intangible		$	(32,141	)		$
Net Cash (used by) Investing Activities		$	(32,141	)		$
Cash Flows from Financing Activities:
Principal Payments Under Borrowings		$	(44,580	)		$	(44,580	)
Proceeds from Stock option purchase
Net Cash Provided by (used by) Financing Activities		$	(44,580	)		$	(44,580	)
Net Increase (Decrease) in Cash and Cash Equivalents		$	(93,473	)		$	(3,053	)
Cash and Cash Equivalents at the Beginning of Year		$	1,606,404				1,609,457
Cash and Cash Equivalents at the End of Quarter		$	1,512,931			$	1,606,404
Additional Cash Flow Information:
Cash Payments During the Year
Interest		$	33,198			$	34,577
Income Taxes		$	30,172			$	6,321

 

See Accompanying Notes to Financial Statements.

 

  

MILLER INDUSTRIES, INC.

STATEMENT OF SHAREHOLDERS’ EQUITY

YEARS ENDED APRIL 30, 2014 AND 2013

 

COMMON STOCK

 

		Shares Issued				Amount				Additional Paid-in Capital				(Deficit)				(Total)
Balance at April 30, 2012			5,000,000			$	250,000			$	1,212,102			$	(1,013,202	)		$	448,900
Net Income – 2013			-				-				-				52,584				52,584
Balance at April 30, 2013			5,000,000			$	250,000			$	1,212,102			$	(960,618	)		$	501,484
Net Income – 2014			-				-				-				11,788				11,788
Balance at April 30, 2014			5,000,000			$	250,000			$	1,212,102			$	(948,830	)		$	513,272

 

See Accompanying Notes to Financial Statements.

 

 

MILLER INDUSTRIES, INC.

NOTES TO FINANCIAL STATEMENTS

APRIL 30, 2014 AND 2013

 

NOTE A - Summary of Significant Accounting Policies

 

This summary of accounting policies for Miller Industries Inc. is presented to assist in understanding the Company’s financial statements. The accounting policies conform to U.S. generally accepted accounting principles and have been consistently applied in preparation of the financial statements.

 

1.

Nature of Operations -

 

Miller Industries, Inc., a Florida corporation, currently and since August 1991, has been engaged in the ownership and management of 98,000 square feet of offices and warehouse located in Miami, Florida. During August 1991, the Company discontinued its operations of manufacturing of aluminum windows and doors pursuant to a plan of reorganization.

 

2.

Real Property -

 

Property is carried at cost. The Company calculates depreciation under the straight-line method at annual rates based upon the estimated service lives of each type of asset. These service lives are generally as follows:

 

Building and Improvements	10 to 30 years
Machinery and Equipment	7 years
Furniture and Fixtures	7 years

 

Real property and equipment, with an original cost of approximately $745,000, have been fully depreciated at April 30, 2014.

 

3.

Deferred Costs -

 

Deferred lease incentive and loan costs are carried at cost. The Company amortizes these assets on a straight-line basis up to 10 years.

 

4.

Income Taxes -

 

The Company accounts for income taxes under the liability method. Deferred income tax assets and liabilities are determined based on differences between the financial reporting and tax base of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to be reversed.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

The Company uses a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not, that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% (fifty percent) likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating our tax positions and tax benefits, which may require periodic adjustments. At April 30, 2013 and 2014, respectively, the Company did not record any liabilities for uncertain tax positions.

 

5.

Earnings Per Share -

 

Basic earnings per share (“EPS”) is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants). Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive.

 

6.

Cash and Cash Equivalents –

 

The Company considers all short-term investments with an original maturity of three months or less to be cash equivalents.

 

The balances are insured by the Federal Deposit Insurance Corporation up to $250,000. At April 30, 2014, and 2013 the Company’s uninsured bank balances approximated $1,263,000 and $1,356,000 respectively.

 

7.

Financial Instruments -

 

The carrying amounts of cash and cash equivalents, other assets, accounts payable, and debt approximate fair value.

 

8.

Concentrations –

 

The Company is subject to certain risk arising from the concentration of its tenant income from entities that comprise 10% or more of the Company’s revenue. Tenant “A” 74% of Revenue. Tenant “B” 23% of Revenue.

 

9.

Revenue Recognition -

 

The Company recognizes rental income on a straight-line basis over the respective lease terms.

 

10.

Environmental Cleanup Matters -

 

The Company expenses environmental expenditures related to existing conditions resulting from past or current operations and from which no current or future benefit is discernable. The Company determines its liability on a site-by-site basis and records a liability at the time when it is probable and can be reasonably estimated.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

11.

Use of Estimates -

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes Actual results could differ from those estimates. The most significant estimates included in the preparation of the financial statements are related to income taxes, asset lives, accruals and valuation allowances.

 

12.

Comprehensive Income -

 

ASC 220, Comprehensive Income established standards for reporting and displaying comprehensive income and its components in the financial statements. The company does not have any comprehensive income for fiscal 2014 and 2013.

 

13.

Long-Lived Assets -

 

Under ASC 360, Property, Plant and Equipment, The Company evaluates the carrying value of long-lived assets (including property, equipment and intangible assets) when events or circumstances warrant such a review. If the carrying value of the long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the asset. The respective fair values of the Company’s long-lived assets exceeded their carrying amounts at April 30, 2014 and April 30, 2013.

 

14.

Segments -

 

The Company operates in one segment and therefore segment information is not presented.

 

15.

Derivative Instruments -

 

Under ASC 815, Derivative and Hedging, the Company will be required to recognize all derivative instruments, including certain derivative instruments embedded in other contracts on the balance sheet at fair value. Derivatives that are not hedges must be adjusted to fair value through income. If the derivative is a hedge, depending on the nature of the hedge, changes in the fair value of derivatives will either be offset against the change in fair value of hedged assets, liabilities, or firm commitments through earnings or recognized in other comprehensive income until the hedged item is recognized in earnings. The ineffective portion of a derivative’s change in fair value will be immediately recognized in earnings.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

16.

Stock-Based Compensation -

 

In accordance with ASC 718, Compensation- Stock Based Compensation, the Company accounts for share-based payments using the fair value method. Common shares issued to third parties for non-cash consideration are valued based on the fair market value of the service provided or the fair market value of the common stock on the measurement date, whichever is more readily determinable.

 

17.

Pensions and Other Post-Retirement Benefits -

 

ASC 715, Compensation – Retirement benefits, requires additional disclosures relating to how investment allocation decisions are made, the major categories of plan assets and the inputs and valuation techniques used to measure the fair value of plan assets. The overall objective of ASC 715 is to improve and standardize disclosures about pensions and other post-retirement benefits and to make the required information more understandable.

 

The Company has not initiated benefit plans to date which would require disclosure under the statement.

 

18.

Advertising Costs -

 

Advertising costs are charged to operations in the period incurred. The Company has not incurred any advertising costs for fiscal 2014 and 2013.

 

19.

Business Concentrations -

 

Rental income of the Company’s office and warehouse building is subject to the economic conditions of the industrial real estate market place. Changes in this industry may significantly affect management’s estimates and the Company’s performance.

 

20.

Accounting Changes and Error Corrections -

 

The Company follows ASC 250, Accounting Changes and Error Corrections. Changes in accounting principle are reported through retrospective application of the new accounting principle to all prior periods. Errors in the financial statements of a prior period discovered subsequent to their issuance shall be reported as a prior period adjustment by restating the prior period.

 

21.

Tenant’s Security Deposits –

 

The Company requires security deposits from lessees for the duration of the lease. The security deposits are refunded when the tenant vacates, provided the tenant has not damaged the space and is current on rental payments.

 

22.

Fair Value Measurements and Disclosures –

 

ASC 820, Fair Value Measurements and Disclosures, applies whenever other standards require assets or liabilities to be measured at fair value and does not expand the use of fair value in any new circumstances. ASC 820 established a hierarchy that prioritizes the information used in developing fair value estimates.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

The levels of fair value hierarchy are as follows:

 

·

Level 1 inputs utilize unadjusted quoted prices in active markets for identical assets or liabilities that the company has the ability to access;

·

Level 2 inputs utilize other-than-quoted prices that are observable, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs such as interest rates and yield curves that are observable at commonly quoted intervals; and

·

Level 3 inputs are unobservable and are typically based on our own assumptions, including situations where there is little, if any, market activity.

 

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the Company categorizes such financial asset or liability based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

 

Both observable and unobservable inputs may be used to determine the fair value of positions that are classified within the Level 3 category. As a result, the unrealized gains and losses for assets within the Level 3 category can include changes in fair value that were attributable to both observable and unobservable inputs. The Company has no instruments that require additional disclosure.

 

23.

Fair Value Option for Financial Instruments –

 

The Company’s financial instruments consist principally of cash, receivables, accounts payable and mortgage payable. Pursuant to ASC 820, Fair Value Measurement s and Disclosures and ASC 825, Financial Instruments, the fair value of the Company’s financial instruments are determined based upon Level “1” and Level “2” inputs.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

NOTE B - Mortgage Payable

 

Principal balances outstanding and details of notes payable are summarized as follows:

 

		2014				2013
10-year note payable, collateralized by mortgage on land and building, improvements, personal property collateral assignment of all rents and leases, along with the personal guaranty of the Company’s Chairman of the Board to 50% of all sums due under the loan.  In addition, the guarantor shall indemnify lender from any and all liability which may result from the environmental condition of the property.  The note bears interest at ½ of 1% (.050%) rate under the lenders prime rate per annum. The Rate of interest is adjustable annually based on the current Prime at the anniversary date. The company’s annual interest Rate at April 30, 2014 is 2.75%. The note is payable in Monthly installments of $3,715, plus accrued interest, with a final payment of approximately $911,000 due November 2019.
		$	1,160,080			$	1,204,660

 

Payments of principal required on the foregoing debt are as follows:

 

Fiscal Year Ending
2015			44,580
2016			44,580
2017			44,580
2018			44,580
Thereafter			981,760
Total		$	1,160,080

 

Land, buildings and improvements, with an approximate cost of $1,222,000 and an approximate net book value of $303,000 are pledged as collateral for these obligations.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

NOTE C - Income Taxes

 

The provision (benefit) for income taxes consists of the following:

 

		2014				2013
Current		$	2,537			$	16,072
Deferred			(383	)			-
Tax Benefit of Net Operating Loss Carryforward			-				316
Deferred Tax Adjustment and Changes to Valuation Allowance			-				4,988
Total		$	2,154			$	21,376

 

Deferred income taxes arise primarily due to temporary differences in recognizing certain revenues and expenses for tax purposes, the required use of extended lives for calculation of depreciation for tax purposes.

 

The components of the net deferred tax asset at April 30, 2014 and 2013 are as follows:

 

		2014				2013
Properties and Equipment principally due to Depreciation		$	40,376			$	39,993
Provision for Bad Debts
Total gross deferred tax assets		$	40,376			$	39,993
Less:   Valuation allowance			-				-
Net Deferred Tax Asset		$	40,376			$	39,993

 

A valuation allowance is provided to reduce the deferred tax assets to a level which, more likely than not, will be realized. The net deferred assets reflect management’s assessment of the amount which will be realized from future taxable earnings or alternative tax strategies.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

NOTE C – Income Taxes (continued)

 

Total Federal tax expense for years ended April 30, 2014 and 2013 differed from the amount computed by applying the U.S. federal income tax rate of 34% to income (loss) from continuing operations before income tax for the following reasons:

 

		2014								2013
		Percent Of Pre-Tax								Percent Of Pre-Tax
		Amount				Income				Amount				Income
Income before provision for income taxes		$	13,932				100	%		$	73,960				100	%
Computed expected tax expense		$	4,740				34	%		$	25,146				34	%
Federal tax (benefit) of State Income Tax			-				-				(1,293	)			(2	)
Sur Tax Exemption			(2,730	)			(20	)			(11,268	)			(15	)
Non deductible items			142				1				-				-
Federal Tax Before Tax Benefits		$	2,152				15	%		$	12,585				17	%
Tax Benefits of Net Operating
Loss Carryforwards, Deferred Tax Adjustments And Change in Valuation Allowance			-				-				4,190				6
Actual Federal Tax		$	2,152				15	%		$	16,775				23	%

 

Tax years that remain subject to examination are years 2008 and forward.

 

NOTE D - Rental Income

 

During 2014, the Company leased warehouse and manufacturing space to three unrelated third parties under leases that expire at various dates thru fiscal 2015. Rental income approximated $314,000 and $332,000 for fiscal 2014 and 2013, respectively. Rental income from these leases amounted to 100% of the total 2014 rental income and 100% of the total 2013 rental income.

 

Future minimum rental income under non-cancelable leases, excluding cost of living adjustments are as follows:

 

2015		$	465,000
2016		$	470,000
2017		$	395,000
2018		$	245,000
2019		$	245,000
2020		$	61,000

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

NOTE E - Rental Expenses (Except for Interest)

 

Rental expenses consisted of:
		2014				2013
Commissions and Consulting		$	13,733			$	3,243
Depreciation and Amortization			21,791				18,220
Insurance			29,763				31,192
Management Fees			44,000				36,000
Outside Services			3,609				3,446
Repairs and Maintenance			51,023				5,636
Utilities			4,247				5,436
Taxes and permits			52,163				63,654
Totals		$	220,329			$	166,827

 

NOTE F - Administrative Expenses

  

Administrative expenses consisted of:
		2014				2013
Accounting and Legal		$	29,208			$	35,712
Office Supplies/Postage/Other			1,519				1,133
Stockholders’ Expenses			24,486				24,025
Telephone			1,362				1,121
Totals		$	56,575			$	61,991

 

NOTE G - Related Party Transactions

 

Management fees and reimbursements in the amount of $ 44,150 and $36,000 for 2014 and 2013 was paid to Angelo Napolitano, CEO. Harnap Corp which is controlled by Mr. Napolitano, was reimbursed for bookkeeping services, repairs, legal and office supplies for approximately $23,500 and $19,500 for 2014 and 2013. Included in accounts payable is approximately $50,000 and $100,000 for 2014 and 2013 that is owned to Harnap Corp. The mortgage note payable is guaranteed by the company’s C.E.O. up to 50% of all sums due.

 

  

Miller Industries, Inc.

Notes to Financial Statements

 

NOTE H – Commitments, Contingent Liabilities, Other Matters, and Subsequent Events

 

1.

May 2, 2014, the Company entered into a 38-month lease of approximately 17,000 square feet at a monthly rental of approximately $9,300 per month.