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Item 9A. Controls and Procedures

2021-09-08 compared with 2020-08-31 · 46 added, 57 removed, 82 unchanged (56% of the section changed)

Item 9A Controls and Procedures

Controls and Procedures

Evaluation of disclosure controls and procedures – Based on their evaluation as of the end of the period covered by this Annual Report on Form 10-K, the Company’s chief executive officer and chief financial officer have concluded that disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) were effective as of June 30, 2021.

4 unchanged sentences

The effectiveness of the Company’s internal control over financial reporting as of June 30, 2021, has been audited by Deloitte & Touche LLP, the Company’s independent registered public accounting firm, as stated in their report in Part II, Item 8 of this Form 10-K.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the fiscal quarter ended June 30, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Other Information

On September 8, 2021, the Company, as borrower, entered into a credit agreement (the “Credit Agreement”) with Wells Fargo Bank, National Association (the “Lender”) and the other lenders party thereto.

The Credit Agreement has a five-year term and provides for up to a $85 million revolving line of credit.

Subject to certain conditions, the Credit Agreement also provides for the issuance of letters of credit in an aggregate amount up to $5,000,000 which, upon issuance, would be deemed advances under the revolving line of credit.

The Company’s $1.2 million of letters of credit previously issued by Lender will be treated as outstanding under the Credit Agreement.

Proceeds of borrowings shall be used to refinance all indebtedness owing to Dubuque Bank & Trust and for working capital purposes.

The Company’s obligations under the Credit Agreement are secured by substantially all of its assets, excluding real property.

Subject to certain conditions, borrowings under the Credit Agreement bear interest at 1.25% or 1.50% per annum plus LIBOR.

If LIBOR becomes unavailable, the replacement rate will be determined pursuant to the terms of the Credit Agreement.

The Credit Agreement contains customary representations, warranties and covenants, including a financial covenant to maintain a fixed coverage ratio of not less than 1.00:1.00.

In addition, the Loan Agreement places restrictions on the Company’s ability to incur additional indebtedness, to create liens or other encumbrances, to sell or otherwise dispose of assets, and to merge or consolidate with other entities.

The full terms and conditions of this financing are set forth in the Credit Agreement.

A copy of the Credit Agreement is filed as Exhibit 10.22 hereto and is incorporated by reference herein.

Directors, Executive Officers and Corporate Governance

25 unchanged sentences

Pursuant to the requirements of Section 13 or 15(d) 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.

August 28, 2020

September 8, 2021

FLEXSTEEL INDUSTRIES, INC.

3 unchanged sentences

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

August 28, 2020

September 8, 2021

/S/ Jerald K.

1 unchanged sentence

(Principal Executive Officer)

August 28, 2020

September 8, 2021

Chief Financial Officer and Chief Operating Officer

(Principal Financial Accounting Officer)

August 28, 2020

September 8, 2021

/S/ Thomas M.

Chair of the Board of Directors

August 28, 2020

September 8, 2021

/S/ William S.

August 28, 2020

September 8, 2021

/S/ Matthew A.

August 28, 2020

September 8, 2021

/S/ Kathryn P.

Exhibit Index

4 unchanged sentences

2009 Stock Option Plan (incorporated by reference to Appendix A from the 2009 Flexsteel definitive proxy statement).*

Letter Agreement between Karel K.

Czanderna and Flexsteel Industries, Inc.

dated June 29, 2012.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on July 5, 2012).*

Form of Notification of Award for the Cash Incentive Compensation Plan (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 13, 2013).*

Form of Notification of Award for the Long-Term Incentive Compensation Plan (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 13, 2013).*

Form of Notification of Award for incentive stock options issued under the Omnibus Stock Plan (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 13, 2013).*

Form of Notification of Award for the Cash Incentive Compensation Plan.

Form of Notification of Award for the Long-Term Incentive Compensation Plan.* †

Form of Notification of Award for incentive stock options issued under the Omnibus Stock Plan.* †

Form of Notification of Award for director non-qualified stock options issued under the Omnibus Stock Plan (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 13, 2013).*

Form of Notification of Award for restricted stock units issued under the Omnibus Stock Plan (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 13, 2013).*

Form of Notification of Award for restricted stock units issued under the Omnibus Stock Plan.* †

Long-Term Incentive Compensation Plan, dated July 1, 2013 (incorporated by reference to Appendix B to the Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on October 28, 2013).*

Omnibus Stock Plan, dated July 1, 2013 (incorporated by reference to Appendix C to the Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on October 28, 2013).*

Credit Agreement dated June 30, 2016 between Flexsteel Industries, Inc.

and Wells Fargo Bank, N.A.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on July 1, 2016).

Development Agreement dated June 5, 2017 between Flexsteel Industries, Inc.

and The City of Dubuque, Iowa.

Redevelopment Project Agreement dated May 15, 2017 between Flexsteel Industries, Inc., The City of Dubuque, Iowa and Dubuque Initiatives.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on June 12, 2017).

First Amendment to Credit Agreement dated June 30, 2017 between Flexsteel Industries, Inc.

and Wells Fargo Bank, N.A.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on June 30, 2017).

Letter Agreement between Marcus Hamilton and Flexsteel Industries, Inc.

dated December 23, 2017.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 2, 2018).*

Second Amendment to Credit Agreement dated June 5, 2018 between Flexsteel Industries, Inc.

and Wells Fargo Bank, N.A.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on June 8, 2018).

Revolving Line of Credit Note dated June 5, 2018 between Flexsteel Industries, Inc.

and Wells Fargo Bank, N.A.

(incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on June 8, 2018).

Retirement Agreement and Release with Karel K.

Czanderna, dated September 13, 2018 (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on September 21, 2018).

Form of Retention Bonus Agreement (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on September 21, 2018).*

Amendment to Retirement Agreement and Release, dated October 25, 2018 (incorporated by reference to Form 10-Q filed with the Securities and Exchange Commission on October 30, 2018).*

Form of Notification of Non-Statutory Stock Option Award * †

Amended and Restated Omnibus Stock Plan (incorporated by Reference to the Form 8-K filed with the Securities and Exchange Commission on December 15, 2020).*

Form of Notification of Restricted Stock Award.

Severance Plan for Management Employees dated October 25, 2018, including Form of Participation Agreement (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on November 2, 2018).*

First Amendment to the Flexsteel Industries, Inc.

Severance Plan for Management Employees, dated April 15, 2020 (incorporated by reference to Form 10-Q filed with the Securities and Exchange Commission on May 1, 2020).

Form of Confidentiality and Noncompetition Agreement between the Company and Jerald K.

Dittmer (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 20, 2018).*

Separation and Release Agreement between the Company and Richard J.

Stanley, dated January 29, 2019 (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 29, 2019).*

Executive Employment Agreement, dated December 28, 2018 with Jerald K.

4 unchanged sentences

Dittmer (incorporated by reference to Form 10-Q filed with the Securities and Exchange Commission on February 6, 2019).*

Form of Notification of Non-Statutory Stock Option Award (incorporated by reference to Form 10-Q filed with the Securities and Exchange Commission on February 6, 2019).*

Agreement for Purchase and Sale and Joint Escrow Instructions between the Company and Greenlaw Acquisitions, LLC dated August 26, 2019 (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on September 5, 2019).

First Amendment Executive Employment Agreement between the Company and Jerald K.

Dittmer, dated August 30, 2019 (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on September 5, 2019).

Promissory Note dated December 31, 2019 between Flexsteel Industries, Inc.

and MidWestOne Bank (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 3, 2020).

Letter Agreement dated March 10, 2020 by and between Flexsteel Industries, Inc.

Schmidt (incorporated by reference to Form 8-K filed with the to Form 8-K filed with the Securities and Exchange Commission on March 18, 2020).

First Amendment to the Flexsteel Industries, Inc.

Severance Plan for Management Employees, dated April 15, 2020 (incorporated by reference to Form 10-Q filed with the Securities and Exchange Commission on May 1, 2020).

Schmidt (incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 18, 2020).

Credit Agreement dated August 28, 2020 between Flexsteel Industries, Inc.

and Dubuque Bank and Trust Company (incorporated by reference to the Form 8-K filed with the Securities and Exchange Commission on September 1, 2020).

Revolving Line of Credit Note dated August 28, 2020 between Flexsteel Industries, Inc.

and Dubuque Bank and Trust Company (incorporated by reference to the Form 8-K filed with the Securities and Exchange Commission on September 1, 2020).

Security Agreement dated August 28, 2020 between Flexsteel Industries, Inc.

and Dubuque Bank and Trust Company (incorporated by reference to the Form 8-K filed with the Securities and Exchange Commission on September 1, 2020).

Credit Agreement between Flexsteel Industries, Inc.

and Wells Fargo Bank, National Association, dated September 8, 2021.

Subsidiaries of the Company.

Filed herewith.

Consent of Independent Registered Public Accounting Firm.

Filed herewith.

Certification.

Filed herewith.

Certification.

Filed herewith.

Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.

Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.

Certification by Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C.

Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Filed herewith.

Management contracts, compensatory plans and arrangements required to be filed as an exhibit to this report.

Filed herewith

XBRL Instance Document**

8 unchanged sentences

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.

What changed 10-K

Item 9A. Controls and Procedures