4 unchanged sentences
Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations or affect our financial results.
−Removed: Our results of operations may be adversely impacted by a downturn in the economy or in certain sectors of the economy.
−Removed: Any decline or uncertainty in the strength of the economy may lead to a decrease in customer spending and may cause certain customers to cancel or delay placing orders.
−Removed: Some of our customers may file for bankruptcy protection, preventing us from collecting on accounts receivable and may result in our stocking excess inventory.
−Removed: Contractions in the credit markets may also cause some of our customers to experience difficulties in obtaining financing, leading to lower sales, delays in the collection of receivables and result in an increase in bad debt expense.
−Removed: Adverse economic conditions could also affect our key suppliers and contractors.
−Removed: This could lead to us incurring additional expenses or result in delays in shipping products to our customers.
−Removed: Economic uncertainty can make it difficult for us to accurately predict future order activity and affect our ability to effectively manage inventory levels.
−Removed: There are no assurances that we would be able to establish alternative financing or obtain financing with terms similar to our present Credit Agreement.
−Removed: Failure to adequately fund our operating and working capital needs through cash generated from operations and cash available through our Credit Agreement could negatively impact our ability to invest in the business and maintain our capital structure.
−Removed: Our business requires investment in working capital and fixed assets.
−Removed: We fund these investments from cash generated from operations and funds available from our Credit Agreement.
−Removed: Failure to generate sufficient cash flow from operations or from our Credit Agreement could cause us to have insufficient funds to operate our business.
−Removed: Adequate funds may not be available when needed or may not be available on favorable terms.
−Removed: Failure to meet the covenant requirements of our Credit Agreement could lead to higher financing costs, increased restrictions and reduce or eliminate our ability to borrow funds.
−Removed: Our Credit Agreement contain financial and other restrictive covenants.
−Removed: These covenants could adversely affect us by limiting our financial and operating flexibility as well as our ability to plan for and react to market conditions and to meet our capital needs.
−Removed: Failure to meet these covenant requirements could lead to higher financing costs, increased restrictions, reduce or eliminate our ability to borrow funds, or accelerate the payment of our existing indebtedness.
−Removed: If we require more liquidity than is currently available to us under our Credit Agreement, we may need to raise additional funds through debt or equity offerings which may not be available when needed or may not be available on terms favorable to us.
−Removed: Should funding be insufficient at any time in the future, we may be unable to develop or enhance our products or services, take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations.
−Removed: The market price of our common stock may decline.
−Removed: Our stock price could decrease if our financial performance is inadequate or does not meet investors' expectations, if there is deterioration in the overall market for equities, if large amounts of shares are sold in the market, if there is index trading, or if investors have concerns that our business, financial condition, results of operations and capital requirements are negatively impacted by an economic downturn.
+Added: Risks Related to COVID-19 and Other Infectious Diseases
+Added: In 2020, a new strain of coronavirus ("COVID-19") created a worldwide pandemic which has continued to affect our business and could have further undetermined material adverse effects on our revenues, operating results and financial condition.
+Added: The COVID-19 pandemic has resulted in lost revenue to our Company, limitations on our ability to source high demand product, limitations on our sales force to perform certain functions due to state or federal stay-at-home orders, a slow-down of customer demand for our products and limitations of some customers to pay us on a timely basis.
+Added: The impact of the COVID-19 pandemic on our operational and financial performance includes affecting our ability to execute our business strategies and initiatives in the expected time frame.
+Added: The extent of the effect will depend on future developments, including the duration and spread of the pandemic and related restrictions on travel, transports and person to person contact, all of which are uncertain and cannot be predicted at the present time.
+Added: On a broader scale, the COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains and created significant volatility and disruption of financial markets.
+Added: An extended period of global supply chain and economic disruption could materially affect our sales, workforce, supply chains, results of operations, and our ability to access our Credit Agreement (as defined below) to fund operations.
+Added: In the first quarter of 2020, our business was defined by the state of Illinois as an essential business, allowing us to operate during the pandemic.
+Added: A change in this status could result in the temporary closure of our business.
+Added: Additionally, the COVID-19 pandemic could result in a temporary closure of any or all of our distribution facilities or the Bolt branch locations, which would negatively impact our operations.
+Added: Other disruptions to our supply chain such as reduced capacity or temporary shutdowns of freight carriers could also negatively impact Company performance.
+Added: Our sales results have been and may be negatively impacted in the future by any social distancing guidelines and government mandated shelter in place orders that would prevent our sales representatives in our MRO business segment from visiting customers in person.
+Added: Shelter in place orders also reduce customer visits to our Bolt branch locations.
+Added: The reduction of operations and temporary shut down by many of our customers in response to COVID-19 has also negatively impacted sales and our ability to collect on existing credit balances, and we expect to be impacted by those reductions and shut downs in the until the pandemic ends.
+Added: Further, vendors who are negatively impacted by COVID-19 may temporarily shut down operations or have difficulty obtaining inventory, which could negatively impact our ability to fulfill customer orders.
+Added: The Company expects to continue to be negatively impacted by the COVID-19 pandemic and the various federal, state and local restrictions enacted to combat the pandemic.
+Added: In the fourth quarter of 2020, the U.S.
+Added: Food and Drug Administration approved certain vaccines that have demonstrated effectiveness in preventing the spread of the COVID-19 virus.
+Added: However, it is projected that the production, distribution and administration of the vaccine to a sufficient percentage of the population to significantly minimize the future effect of the pandemic will not be reached until mid-2021.
+Added: Certain items on our balance sheet require judgments on their valuation, including intangible assets and goodwill.
+Added: These valuations are based on assumptions that take future financial performance into account.
+Added: COVID-19 may have a negative impact to our future financial performance that would require us to revise assumptions about future financial performance and impair the value of these assets.
+Added: Although the Company believes that its projected future operating results and cash flows and related estimates regarding the values were based on reasonable assumptions, it is reasonably possible that estimates made may be materially and adversely impacted in the near term as a result of the COVID-19 pandemic, including impairment losses related to goodwill.
+Added: In the fourth quarter of 2020 the Company reviewed the 2020 results of the Screw Products reporting unit and completed its 2021 budgeting process.
+Added: Based on the results of its analysis and the time passed since acquisition, the Company determined it would be appropriate to perform a quantitative impairment test on the goodwill of the Screw Products reporting unit.
+Added: The Company performed a quantitative goodwill impairment analysis on December 1, 2020 and determined that the carrying value of the net assets exceeded the fair value of the Screw Products reporting unit, and accordingly recognized an impairment charge of $1.9 million.
+Added: All Lawson employees have been encouraged to follow the recommended social distancing guidelines and work remotely whenever possible to reduce the spread of COVID-19 during the pandemic.
+Added: The increased number of employees working remotely can exacerbate the risks mentioned in regards to internal controls and cybersecurity.
+Added: Business Risks
A significant portion of our inventory may become obsolete.
9 unchanged sentences
Our gross margin percentage may also come under pressure in the future if we increase the percentage of national accounts in our customer base, as sales to these customers are generally at lower margins.
−Removed: Changes in energy costs, tariffs and the cost of raw materials used in our products could impact our cost of goods and distribution and occupancy expenses, which may result in lower operating margins.
−Removed: Increases in the cost of raw materials used in our products (e.g., steel, brass), tariffs and increases in energy costs raise the production costs of our vendors.
−Removed: Those vendors typically look to pass the higher costs along to us through price increases.
−Removed: If we are unable to fully pass these increased prices and costs through to our customers or to modify our activities, the impact would have an adverse effect on our operating profit margins.
−Removed: Low oil prices may result in weaker demand from oil and gas customers in the future, resulting in lower net sales.
−Removed: Changes in trade policies could affect our sourcing of product, our ability to secure sufficient product and/or impact the cost or price of our products, with potentially negative impacts on our reported gross profits and results of operations.
Disruptions of our information and communication systems could adversely affect the Company.
24 unchanged sentences
One of our growth strategies is to actively pursue acquisition opportunities which complement our service oriented business model.
−Removed: Failure to successfully identify the right opportunities and to successfully integrate their operations into our organization could adversely affect our operations and our operating results.
−Removed: The Company is exposed to the risk of foreign currency changes.
−Removed: Two of our subsidiaries are located and operate in Canada using the Canadian dollar as its functional currency.
−Removed: Operating results are translated into U.S.
−Removed: dollars when consolidated into our financial statements.
−Removed: Therefore, we are exposed to market risk relating to the change in the value of the Canadian dollar relative to the U.S.
−Removed: dollar that could adversely affect our financial position and operating results.
+Added: Failure to successfully identify the right opportunities and to successfully integrate their sales teams and operations into our organization could adversely affect our operations and our operating results.
The Company operates in highly competitive markets.
6 unchanged sentences
A decrease in the levels of defense and other governmental spending or the introduction of more stringent governmental regulations and oversight, could lead to reduced sales or an increase in compliance costs which would adversely affect our financial position and results of operations.
+Added: Financial Risks
+Added: Failure to adequately fund our operating and working capital needs through cash generated from operations and cash available through our Credit Agreement could negatively impact our ability to invest in the business and maintain our capital structure.
+Added: Our business requires investment in working capital and fixed assets.
+Added: We fund these investments from cash generated from operations and funds available from our Credit Agreement.
+Added: Failure to generate sufficient cash flow from operations or from our Credit Agreement could cause us to have insufficient funds to operate our business.
+Added: Adequate funds may not be available when needed or may not be available on favorable terms.
+Added: Failure to meet the covenant requirements of our Credit Agreement could lead to higher financing costs, increased restrictions and reduce or eliminate our ability to borrow funds.
+Added: Our Credit Agreement contain financial and other restrictive covenants.
+Added: These covenants could adversely affect us by limiting our financial and operating flexibility as well as our ability to plan for and react to market conditions and to meet our capital needs.
+Added: Failure to meet these covenant requirements could lead to higher financing costs, increased restrictions, reduce or eliminate our ability to borrow funds, or accelerate the payment of our existing indebtedness.
+Added: If we require more liquidity than is currently available to us under our Credit Agreement, we may need to raise additional funds through debt or equity offerings which may not be available when needed or may not be available on terms favorable to us.
+Added: Should funding be insufficient at any time in the future, we may be unable to develop or enhance our products or services, take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations.
+Added: Risks Related to Common Stock
+Added: The market price of our common stock may decline.
+Added: Our stock price could decrease if our financial performance is inadequate or does not meet investors' expectations, if there is deterioration in the overall market for equities, if large amounts of shares are sold in the market, if there is index trading, or if investors have concerns that our business, financial condition, results of operations and capital requirements are negatively impacted by an economic downturn.
+Added: Luther King Capital has significant influence over the Company, and this influence could delay or deter a change in control or other business combination or otherwise cause us to take actions with which you may disagree.
+Added: On December 31, 2020, Luther King Capital beneficially owned 48.0% of the outstanding common stock of the Company.
+Added: Bryan King, a director of the Company, is the Principal of Luther King Capital.
+Added: As a result, Luther King Capital has significant influence over the outcome of matters requiring a stockholder vote, including the election of directors, and the approval of significant matters and its interests may not align with the interests of other stockholders.
+Added: This concentration of ownership could also have the effect of delaying, determining or preventing a change of control or other business combination that might be beneficial to our stockholders.
+Added: Legal and Regulatory Risks
A violation of federal, state or local environmental protection regulations could lead to significant penalties and fines or other remediation costs.
10 unchanged sentences
Changes in applicable tax laws and regulations could continue to affect our ability to realize the deferred tax assets on our balance sheet, which could affect our results of operations.
−Removed: Luther King Capital has significant influence over the Company, and this influence could delay or deter a change in control or other business combination or otherwise cause us to take actions with which you may disagree.
−Removed: In January 2019 LKCM Headwater Investments, an affiliate of Luther King Capital, purchased additional shares of common stock of the Company, and as a result on December 31, 2019 Luther King Capital beneficially owned 47.6% of the outstanding common stock of the Company.
−Removed: Bryan King, a director of the Company, is the Principal of Luther King Capital.
−Removed: As a result, Luther King Capital has significant influence over the outcome of matters requiring a stockholder vote, including the election of directors, and the approval of significant matters and its interests may not align with the interests of other stockholders.
−Removed: This concentration of ownership could also have the effect of delaying, determining or preventing a change of control or other business combination that might be beneficial to our stockholders.
+Added: General Risks
+Added: Our results of operations may be adversely impacted by a downturn in the economy or in certain sectors of the economy.
+Added: Any decline or uncertainty in the strength of the economy may lead to a decrease in customer spending and may cause certain customers to cancel or delay placing orders.
+Added: In the first quarter of 2020, the economy experienced a significant decline due to the response of businesses and state governments to the onset of the COVID-19 pandemic.
+Added: Subsequently, the economy partially recovered from the initial downturn.
+Added: Some of our customers may file for bankruptcy protection, preventing us from collecting on accounts receivable and may result in our stocking excess inventory.
+Added: Contractions in the credit markets may also cause some of our customers to experience difficulties in obtaining financing, leading to lower sales, delays in the collection of receivables and result in an increase in bad debt expense.
+Added: Adverse economic conditions could also affect our key suppliers and contractors.
+Added: This could lead to us incurring additional expenses or result in delays in shipping products to our customers.
+Added: Economic uncertainty can make it difficult for us to accurately predict future order activity and affect our ability to effectively manage inventory levels.
+Added: There are no assurances that we would be able to establish alternative financing or obtain financing with terms similar to our present Credit Agreement.
+Added: Changes in energy costs, tariffs and the cost of raw materials used in our products could impact our cost of goods and distribution and occupancy expenses, which may result in lower operating margins.
+Added: Increases in the cost of raw materials used in our products (e.g., steel, brass), tariffs and increases in energy costs raise the production costs of our vendors.
+Added: Those vendors typically look to pass the higher costs along to us through price increases.
+Added: If we are unable to fully pass these increased prices and costs through to our customers or to modify our activities, the impact would have an adverse effect on our operating profit margins.
+Added: Low oil prices may result in weaker demand from oil and gas customers in the future, resulting in lower net sales.
+Added: Changes in trade policies could affect our sourcing of product, our ability to secure sufficient product and/or impact the cost or price of our products, with potentially negative impacts on our reported gross profits and results of operations.
+Added: The Company is exposed to the risk of foreign currency changes.
+Added: Two of our subsidiaries are located and operate in Canada using the Canadian dollar as its functional currency.
+Added: Operating results are translated into U.S.
+Added: dollars when consolidated into our financial statements.
+Added: Therefore, we are exposed to market risk relating to the change in the value of the Canadian dollar relative to the U.S.
+Added: dollar that could adversely affect our financial position and operating results.
UNRESOLVED STAFF COMMENTS.
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.