What changed in this filing

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Item 1A. Risk Factors

2021-12-17 compared with 2020-12-18 · 40 added, 34 removed, 159 unchanged (32% of the section changed)

4 unchanged sentences

The order of these risk factors does not reflect their relative importance or likelihood of occurrence.

The business is affected by the cyclical nature of the markets it serves and steel prices

The demand for the Company’s products and service is dependent on general economic conditions and more specifically, the commercial highway construction industry.

The business is affected by the cyclical nature of the markets it serves

The demand for the Company’s products is dependent on general economic conditions and more specifically, Federal and state funding for highways and roads.

Adverse economic conditions may cause customers to forego or delay new purchases and rely more on repairing existing equipment thus negatively impacting the Company’s sales and profits.

Volatile steel prices and shortage of qualified workers may have adverse effects on the Company.

Market conditions could limit the Company’s ability to raise selling prices to offset increases in material and/or labor costs.

The business is affected by the level of government funding for highway construction in the United States and Canada

5 unchanged sentences

The loss of any relationship with a large customer, or a significant downturn in the business or financial condition of any such customer, could have adverse consequences on the Company’s future business.

The percentage of the Company’s net revenue that was derived from sales to its largest customer was 9% in fiscal 2020, 6% in fiscal 2019 and 3% in fiscal 2018.

No customer accounted for 10% or more of fiscal 2021 or 2020 revenues.

15 unchanged sentences

Although the Company believes that its profit margins are fairly stated and that adequate provisions for losses for its fixed-price contracts are recorded in the financial statements, as required by accounting principles generally accepted in the United States of America (“GAAP”), the Company cannot assure that its estimated contract profit margins will not decrease or its estimated loss provisions will not increase materially in the future.

The Company may encounter difficulties with future acquisitions.

The Company may encounter difficulties with acquisitions

As part of its growth strategy, the Company intends to evaluate the acquisition of other companies, assets or product lines that would complement or expand the Company’s existing business or broaden its customer base.

1 unchanged sentence

There can be no assurance that the Company will be able to locate and acquire any business, retain key personnel and customers of an acquired business or integrate any acquired business successfully.

Additionally, there can be no assurance that financing for any acquisition, if necessary, will be available on acceptable terms, if at all, or that the Company will be able to accomplish its strategic objectives in connection with any acquisition.

Demand for the Company’s products is cyclical in nature.

Demand for the Company’s products depends, in part, upon the level of capital expenditures by companies in the highway construction industry.

The highway construction industry historically has been cyclical and vulnerable to downturns in the economy.

Decreases in industry spending could have a material adverse effect upon demand for the Company’s products and negatively impact its business, financial condition, results of operations and the market price of its common stock.

The Company’s marketable securities are comprised of cash and money funds, equities, corporate bonds, mutual funds, exchange-traded funds, and government securities invested through professional investment management firms and are subject to various risks, such as interest rates, markets, and credit.

he Company’s marketable securities are comprised of cash and money funds, equities, corporate bonds, mutual funds, exchange-traded funds, and government securities invested through professional investment management firms and are subject to various risks, such as interest rates, markets, and credit

Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of securities, changes in these risk factors could have a material adverse impact on the Company’s results of operations.

9 unchanged sentences

The Company may be required to defend its intellectual property against infringement or against infringement claims of others

The Company held numerous patents covering technology and applications related to various products, equipment and systems, and numerous trademarks and trade names registered with the U.S.

The Company holds numerous patents covering technology and applications related to various products, equipment and systems, and numerous trademarks and trade names registered with the U.S.

Patent and Trademark Office and in various foreign countries.

12 unchanged sentences

The Company’s business involves environmental management and issues typically associated with historical manufacturing operations.

To date, the Company’s cost of complying with environmental laws and regulations has not been material, but the fact that such laws or regulations are changed frequently makes predicting the cost or impact of such laws and regulations on the Company’s future operations uncertain.

The loss of one or more of the Company’s strategic suppliers could cause production delays.

Company is dependent upon third-party suppliers, making it vulnerable to supply shortages and price increases

The principal raw material the Company uses is carbon steel which is sourced through numerous suppliers.

The Company also uses select suppliers to provide proprietary components to its finished products.

Although the Company believes that raw materials are readily available from alternate sources, an interruption in the supply of steel and related products or a substantial increase in the price of steel could have a material adverse effect on the Company’s production and its results of operations.

The Company is subject to government regulations.

Although the Company believes that raw materials are available from alternate sources, an interruption in the supply of steel or related products or a substantial increase in the price of steel or related products could have a material adverse effect on the Company’s production and its results of operations.

In addition, the cost of parts or materials may increase significantly for reasons other than changes in commodity prices.

Factors such as supply and demand, freight costs, availability of transportation, availability of labor, inventory levels, the level of imports, the imposition of duties and tariffs and other trade barriers and general economic conditions may affect the price of our parts or materials.

Market conditions could limit the Company’s ability to raise selling prices to offset increases in material and/or labor costs.

In the future, we could experience some disruption in the supply of some of our parts or materials that we purchase from suppliers.

Delays in obtaining parts or materials may result from a number of factors affecting our suppliers including capacity constraints, labor shortages or supplier product quality issues.

These risks are increased in a weak economic environment or when demand increases coming out of an economic downturn.

Such disruptions could result in manufacturing inefficiencies caused by the Company having to wait for parts to arrive on production lines, could delay sales and could result in a material adverse effect on the Company’s results of operations, financial condition, and/or cash flows.

e Company is subject to government regulations

The Company is committed to responsible environmental, social and governance (“ESG”) practices.

17 unchanged sentences

The holders of the Class B stock are entitled to elect 75% (calculated to the nearest whole number, rounding five-tenths to next highest whole number) of the members of the Company’s Board of Directors.

Further, approval of a majority of the holders of the Class B stock is generally required to effect a sale of the Company and certain other corporate transactions.

Further, approval of a majority of the holders of the Class B stock is generally required to affect a sale of the Company and certain other corporate transactions.

As a result, the Class B shareholders can elect more than a majority of the Board of Directors and exercise significant influence over most matters requiring approval by the Company’s shareholders.

9 unchanged sentences

The Company maintains officers’ and directors’ liability insurance coverage.

There can be no assurance that such insurance will be available in the future, or that if available, it will be available on terms that are

acceptable to the Company.

There can be no assurance that such insurance will be available in the future, or that if available, it will be available on terms that are acceptable to the Company.

Furthermore, there can be no assurance that the insurance coverage provided will be sufficient to cover the amount of any judgment awarded against an officer or director (either individually or in the aggregate).

23 unchanged sentences

Expiration or renewal of Federal highway programs;

Changes to state or Canadian provincial programs.

Changes to federal, state or Canadian provincial programs.

Period-to-period

10 unchanged sentences

The Company’s business, results of operations financial condition, cash flows, and the stock price of its common stock can be adversely affected by pandemics or other public health emergencies, such as the recent outbreak of COVID-19

and its variants.

In March 2020, the WHO declared COVID-19

2 unchanged sentences

The outbreak of COVID-19

and any preventive or protective actions taken by governmental authorities may have a material adverse effect on the Company’s operations, supply chain, customers, and transportation networks, including business shutdown or disruptions.

(including any variants) and any preventive or protective actions taken by governmental authorities may have a material adverse effect on the Company’s operations, supply chain, customers, and transportation networks, including business shutdown or disruptions.

The extent to which COVID-19

may adversely impact the Company’s business depends on future developments, which are highly uncertain and unpredictable, depends upon the severity and duration of the outbreak and the effectiveness of actions taken globally to contain or mitigate its effect.

and its variants may adversely impact the Company’s business depends on future developments, which are highly uncertain and unpredictable, depends upon the severity and duration of the outbreak and the effectiveness of actions taken globally to contain or mitigate its effect.

Any resulting financial impact cannot be estimated reasonably at this time, but may materially adversely affect the Company’s business, results of operations, financial condition, and cash flows.

Even after the COVID-19

pandemic has subsided, the Company may experience materially adverse impacts to its business due to any resulting economic recession or depression.

pandemic has subsided, the Company may experience materially adverse impacts to its business due to any resulting economic downturn.

Additionally, concerns over the economic impact of COVID-19

have caused extreme volatility in financial and other capital markets, which has and may continue to adversely impact the Company’s stock price, its ability to access capital markets, and the value of its investment portfolio.

and its variants have caused volatility in financial and other capital markets, which has and may continue to adversely impact the Company’s stock price, its ability to access capital markets, and the value of its investment portfolio.

To the extent the COVID-19

2 unchanged sentences

Under Section 3(a)(1)(A) of the Investment Company Act, a company is deemed to be an investment company if it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting, or trading in securities.

The Company believes that it is not an investment company under Section 3(a)(1)(A) of the Investment Company Act because it does not hold itself out as being engaged primarily in the business of investing in securities.

Rather, the Company has been a manufacturer of heavy equipment used in the production of asphalt for highway construction and environmental control equipment for over 50 years.

The Company’s core products include asphalt plants, combustion systems, and fluid heat transfer systems.

The Company is expanding its product offerings through new product introductions and its recent acquisition of an asphalt paver product line.

The Company is expanding its product offerings through new product introductions and its 2020 acquisition of an asphalt paver product line.

Under Section 3(a)(1)(C) of the Investment Company Act, a company is deemed to be an investment company if it is engaged, or proposes to engage in the business of investing, reinvesting, owning, holding, or trading in securities and owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S.

2 unchanged sentences

Section 3(a)(2) defines the term “investment securities”, as used in Section 3(a)(1)(C) to include all marketable securities except government securities and cash and cash equivalents.

The value of the Company’s investment securities was approximately 57% of the value of its total assets (excluding government securities and cash items) at September 30, 2020.

The value of the Company’s investment securities exceeded 40% of the value of its total assets (excluding government securities and cash items) at September 30, 2021.

Because of the value of its investment securities, the Company may be deemed an investment company.

The Company believes that it is not an investment company under Section 3(a)(1)(C) of the Investment Company Act because it does not propose to engage in the business of investing, reinvesting, owning, holding, or trading in securities.

In addition, if the Company was deemed an investment company under Section 3(a)(1)(C), it believes that it will qualify for an exemption from the definition of an investment company as it is primarily engaged in a business other than that of investing in securities.

As noted above, the Company is primarily engaged in the manufacturing of heavy equipment.

If the SEC or a court challenged the Company’s status as an operating company, it could incur significant legal expenses.

If the Company was deemed to be, and was required to register as an investment company, the Company would be forced to comply with the legal requirements of the Investment Company Act.

If the Company was deemed to be, and was required to register as an investment company, the Company would be forced to comply with the legal requirements of the Investment Company Act that would regulate the manner in which the Company would be permitted to conduct its business activities.

As an investment company, the Company would be (i) subjected to disclosure and accounting guidance geared toward investment, rather than operating, companies;

and (ii) required to undertake significant expense to meet other disclosure, reporting, and regulatory requirements to which it would be subject as a registered investment company.

The Company faces risks in connection with the acquisition of Blaw-Knox and any future acquisitions.

The Company acquired the Blaw-Knox paver product line on October 1, 2020.

(ii) significantly limited in its ability to borrow money, issue options, issue multiple classes of stock and debt, and engage in transactions with affiliates;

and (iii) required to undertake significant costs and expenses to meet other disclosure, reporting, and regulatory requirements to which it would be subject as a registered investment company.

The Company faces risks with the acquisition of Blaw-Knox and any future acquisitions.

The Company acquired the Blaw-Knox assets on October 1, 2020.

The success of this acquisition depends, in part, on the Company’s ability to successfully grow the business and realize anticipated benefits, including any synergies.

It may take longer than expected to realize growth in the business or realize anticipated benefits, which may be smaller than the Company expects.

It may take longer than expected to realize growth in the business or realize anticipated benefits, which may be smaller than the Company expected.

Also, there are a number of challenges and risks involved in the Company’s ability to successfully integrate Blaw-Knox with its current business.

5 unchanged sentences

The Company’s failure to successfully integrate the operations of any business that it may acquire in the future may adversely affect our business, financial position, results of operations, or cash flows.

There can be a shortage of skilled production workers, especially those with welding and/or fabricating capabilities.

The Company could experience difficulty hiring or replacing those individuals, which could adversely affect its business.

Our fabrication process requires skilled production workers.

If we are unable to retain and hire an adequate number of individuals with welding and fabrication capabilities, this could adversely impact our ability to achieve our financial objectives.

In addition, if demand for skilled production workers were to significantly outstrip supply, wages for these workers could dramatically increase and could affect our financial performance.

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.

What changed 10-K

Item 1A. Risk Factors