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Evaluation of Disclosure Controls and Procedures
−Removed: We seek to maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
+Added: We seek to maintain disclosure controls and procedures (as defined in Rules 13a-15I and 15d-15I under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
This information is also accumulated and communicated to management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure.
Our management, under the supervision and with the participation of our CEO and CFO, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the most recent fiscal quarter reported on herein.
−Removed: Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of September 30, 2020 .
+Added: Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of March 31, 2021 .
Changes in Internal Control over Financial Reporting
−Removed: There were no changes in our internal control over financial reporting, including but not limited to changes resulting from the COVID-19 pandemic, during the three months ended September 30, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
+Added: There were no changes in our internal control over financial reporting, including but not limited to changes resulting from the COVID-19 pandemic, during the three months ended March 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
OTHER INFORMATION
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The information required by this item is incorporated herein by reference to Note 12, “Legal Proceedings” of the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.
−Removed: There have been no material changes to the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2019 except as set forth below and as supplemented by the risk factor set forth on our Current Report on Form 8-K filed April 17, 2020.
−Removed: We have incurred indebtedness under the CARES Act which may be subject to audit, may not be forgivable and may eventually have to be repaid.
−Removed: Any repayment of such indebtedness may limit the funds available to us and may restrict our flexibility in operating our business or otherwise adversely affect our results of operations.
−Removed: On April 15, 2020, the Company received funds under notes and related documents (“PPP Loans”) with CIBC Bank, USA under the Paycheck Protection Program (the “PPP”) which was established under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), as amended by the Paycheck Protection Program Flexibility Act of 2020 (the “Flexibility Act”) in response to the COVID-19 pandemic and is administered by the SBA.
−Removed: The Company received total proceeds of $9,530 from the PPP Loans and made repayments of $379 on May 13, 2020.
−Removed: Under the terms of the CARES Act, as amended by the Flexibility Act, the PPP Loans and accrued interest and fees may be forgiven following a period of twenty-four weeks after PPP Loan proceeds are received (the “covered period”) if they are used for qualifying expenses as described in the CARES Act including payroll costs and benefits (which must equal or exceed 60% of the amount requested to be forgiven), rent, mortgage interest and utilities which are subject to certain reductions based on the number of full time equivalent employees and the level of compensation for employees during such period.
−Removed: Subject to the terms and conditions applicable to loans administered by the SBA under the PPP, as amended by the Flexibility Act, the unforgiven portion of a PPP Loan would be payable over a two year period at an interest rate of 1.00%, with a deferral of payments of principal, interest and fees until the date on which the SBA remits the loan forgiveness amount to the lender (or notifies the lender that no loan forgiveness is allowed), provided that the borrower applies for forgiveness within 10 months after the last day of the covered period (and if not, payment of principal and interest shall commence 10 months after the last day of the covered period).
−Removed: The Company used at least 60% of its PPP Loan proceeds to pay for payroll costs and the balance on other eligible qualifying expenses that it believes to be consistent with the PPP and plans to submit its forgiveness applications to the CIBC Bank, USA in the fourth quarter.
−Removed: While the Company currently believes that its use of the loan proceeds will meet the conditions for forgiveness of the PPP Loans, if all or substantially all of the PPP Loans are not forgiven or it is subsequently determined that the PPP Loans must be repaid, the Company may be required to use a substantial portion of our cash flows from operations to pay interest and principal on the PPP Loans.
−Removed: In addition, although the Company has no current intention of repaying the PPP Loans, any future repayment of such loans, or the Company’s inability to qualify for forgiveness, would impact the Company’s operations and financial results.
−Removed: Department of the Treasury has announced that it will conduct audits for PPP Loans that exceed $2 million.
−Removed: Should the Company be audited or reviewed by the U.S.
−Removed: Department of the Treasury or the SBA, such audit or review could result in the diversion of management’s time and attention and cause the Company to incur significant costs.
−Removed: If the Company were to be audited and receive an adverse outcome in such an audit, the Company could be required to return the full amount of the PPP Loans and may potentially be subject to civil and criminal fines and penalties.
−Removed: The outbreak of COVID-19 has had adverse effects on our operations.
−Removed: We have continued to experience adverse impacts from the novel coronavirus disease (known as COVID-19) in the third quarter of 2020 including a decline in order activity levels within the Gearing and Heavy Fabrications segments and customers’ postponement of scheduled purchases and project timing partially offset by the continued operation of our facilities as essential businesses in light of the customers and markets served.
−Removed: Additionally, in the third quarter, we incurred manufacturing inefficiencies associated with supply chain disruptions and realized employee staffing constraints due to spread of the COVID-19 pandemic.
−Removed: In response to the pandemic, we have right-sized our workforce and delayed certain capital expenditures.
−Removed: In future periods, we may experience weaker customer demand, requests for extended payment terms, customer bankruptcies, additional supply chain disruption, more employee staffing constraints and difficulties, government restrictions or other factors that could negatively impact the Company and its business, operations and financial results.
−Removed: As we cannot predict the duration or scope of the pandemic or its impact on economic and financial markets, any negative impact to our results cannot be reasonably estimated, but it could be material.
+Added: The Risk Factors identified in our Annual Report on Form 10-K for the year ended December 31, 2020 continue to represent the most significant risks to the Company’s future results of operations and financial conditions, without further modification or amendment.
Unregistered Sales of Equity Securities and Use of Proceeds
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Other Information
−Removed: On October 29, 2020, Broadwind, Inc.
−Removed: and its subsidiaries (collectively, the “Company”) entered into a First Amendment (the “First Amendment”) to the Amended and Restated Loan and Security Agreement dated February 25, 2019 between the Company and CIBC Bank USA, as administrative agent and sole lead arranger and the other financial institutions party thereto.
−Removed: Among other changes, the First Amendment implemented a payoff of a syndicated lender and a pricing grid based on the Company's trailing twelve month EBITDA under which applicable margins range from 2.25% to 2.75% for LIBOR rate loans and 0.00% and 0.75% for base rate loans, and extended the term of the existing credit facility to July 31, 2023.
−Removed: The foregoing description of the First Amendment is not intended to be complete and is qualified in its entirety by reference to the First Amendment to Amended and Restated Loan and Security Agreement and other Loan Documents, which is attached hereto as Exhibit 10.3 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.
The exhibits listed on the Exhibit Index are filed as part of this Quarterly Report on Form 10-Q.
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BROADWIND, INC.
−Removed: FORM 10-Q FOR THE QUARTER ENDED September 30, 2020
+Added: FORM 10-Q FOR THE QUARTER ENDED March 31, 2021
Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2008
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Third Amended and Restated Bylaws of the Company, adopted as of May 4, 2020 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed May 6, 2020)
−Removed: Form of Performance Award Agreement (Amended and Restated Broadwind, Inc.
−Removed: 2015 Equity Incentive Plan)*
−Removed: First Amendment to Amended and Restated Broadwind Energy, Inc.
−Removed: 2015 Equity Incentive Plan*
−Removed: First Amendment to the Amended and Restated Loan and Security Agreement and Other Loan Documents, dated October 29, 2020, among the Company, Brad Foote Gearworks, Inc., Broadwind Services, LLC, Broadwind Heavy Fabrications, Inc., Broadwind Industrial Solutions, LLC, CIBC Bank USA, as Administrative Agent for itself and all Lenders and Siena Lending Group
+Added: Second Amendment to the Amended and Restated Loan and Security Agreement, dated February 23, 2021, among the Company, Brad Foote Gearworks, Inc., Broadwind Services, LLC, Broadwind Heavy Fabrications, Inc., Broadwind Industrial Solutions, LLC, and CIBC Bank USA, as Administrative Agent for itself and all Lenders (incorporated by reference to Exhibit 10.33 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020)
+Added: Equity Distribution Agreement, dated March 9, 2021, by and between the Company and Craig-Hallum Capital Group LLC (incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K filed March 9, 2021)
+Added: Rule 13a-14(a) Certification of Chief Executive Officer*
Rule 13a-14(a) Certification of Chief Financial Officer*
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The following financial information from this Form 10-Q of Broadwind, Inc.
−Removed: for the quarter ended September 30, 2020 , formatted in XBRL (eXtensible Business Reporting Language):
+Added: for the quarter ended March 31, 2021 , formatted in XBRL (eXtensible Business Reporting Language):
(i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Stockholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows, and (v) Notes to the Condensed Consolidated Financial Statements, tagged as blocks of text.
−Removed: Indicates management contract or compensation plan or arrangement.
Filed herewith.
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BROADWIND, INC.
−Removed: November 4, 2020
President, Chief Executive Officer
(Principal Executive Officer)
−Removed: November 4, 2020
Vice President, Chief Financial Officer
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.