American Superconductor Corp 8-K/A, filed Dec 14, 2020

American Superconductor Corp (AMSC)

8-K/A 2020-12-14 For: 2020-10-01

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Added on April 11, 2026

About this 8-K/A

American Superconductor Corp filed this 8-K/A on December 14, 2020, reporting on events of October 1, 2020.

Items reported

Item 9.01: Financial statements and exhibits

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Delaware	000-19672	04-2959321
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 par value per share		AMSC		Nasdaq Global Select Market

Exhibit		Description

23.1		Consent of Teal, Becker and Chiaramonte, Independent Auditors.

99.1		Northeast Power Systems, Inc. and subsidiaries, audited consolidated financial statements as of and for the year ended December 31, 2019.

99.2		Northeast Power Systems, Inc. and subsidiaries, unaudited condensed consolidated financial statements as of and for the nine months ended September 30, 2020.

99.3		Unaudited pro forma condensed consolidated financial statements of American Superconductor Corporation as of and for the six months ended September 30, 2020 and for the year ended March 31, 2020.

		AMERICAN SUPERCONDUCTOR CORPORATION

Date:	December 14, 2020	By:	/S/ JOHN W. KOSIBA, JR.
			John W. Kosiba, Jr.
			Senior Vice President and Chief Financial Officer

	Page
Independent Auditors’ Report	1-2
Consolidated Balance Sheet	3
Consolidated Statement of Income	4
Consolidated Statement of Stockholders’ and Members’ Equity	5
Consolidated Statement of Cash Flows	6
Notes to Consolidated Financial Statements	7-14

	Schedule
	Number
CONSOLIDATED SUPPLEMENTARY INFORMATION
Consolidated Schedule of Cost of Goods Sold	I
Consolidated Schedule of Operating Expenses	II

Assets

Current Assets:
Cash	$	3,230,838
Accounts receivable, net (Note 2)		5,184,101
Inventory, net (Note 3)		2,792,086
Total current assets		11,207,025

Property and equipment, net (Note 4)		2,329,706
Due from officers (Note 6)		1,628,356
Other assets		2,100
Total Assets	$	15,167,187

Liabilities And Stockholders' And Members' Equity
Current liabilities:
Accounts payable	$	789,859
Accrued expenses		560,566
Current portion of long-term debt (Note 7)		42,641
Customer deposits (Note 8)		4,597,528
Total current liabilities		5,990,594

Long-term debt (Note 7)		389,833

Total liabilities		6,380,427

Stockholders' and members' equity		8,786,760

Total Liabilities and Stockholders' and Members' Equity	$	15,167,187

				%
Net sales	$	28,779,568			100.0
Cost of goods sold		20,849,650			72.4

Gross profit		7,929,918			27.6

Operating expenses		2,569,812			8.9

Operating profit		5,360,106			18.7

Other income (expenses):
Gain on sale of property and equipment		70,537			0.2
Interest income		36,091			0.1
Interest expense		(22,715	)		(0.1	)
Total other income (expenses), net		83,913			0.2

Consolidated Net Income	$	5,444,019			18.9

Net income attributable to non-controlling interest	$	120,364			0.4

Net income attributable to controlling interest		5,323,655			18.5

Consolidated Net Income	$	5,444,019			18.9

	Total			Common Stock*		Treasury Stock **			Retained Earnings			Non-Controlling Interest/VIE's

Balance at December 31, 2018		8,482,647			279,225		(1,500	)		6,318,214			1,886,708
Consolidated net income		5,444,019			-		-			5,323,655			120,364
Distributions, net		(5,139,906	)		-		-			(5,139,906	)		-
Balance At December 31, 2019	$	8,786,760		$	279,225	$	(1,500	)	$	6,501,963		$	2,007,072

Operating activities:
Consolidated net income	$	5,444,019
Adjustments to reconcile consolidated net income to net cash flows from operating activities:
Depreciation and amortization		142,467
Provision for losses on accounts receivable		41,342
Reserve for inventory obsolescence		276,769
Gain on sale of property and equipment		(70,537	)
Changes in operating assets and liabilities:
Accounts receivable		166,789
Inventory		3,039,155
Accounts payable, accrued expenses, and customer deposits		(2,921,880	)
Net cash flows from operating activities		6,118,124

Investing activities:
Property and equipment expenditures		(262,015	)
Proceeds from sale of property and equipment		79,395
Principal repayments on due from officers		41,132
Net cash flows for investing activities		(141,488	)

Financing activities:
Stockholders' and members' distributions, net		(5,139,906	)
Principal repayments on long-term debt		(40,866	)
Net cash flows for financing activities		(5,180,772	)

Net increase in cash		795,864

Cash - beginning		2,434,974

Cash - ending	$	3,230,838

Supplemental disclosures of cash flows information:

Interest Paid	$	22,715

Accounts receivable at December 31, 2019 consist of:

Accounts receivable - trade	$	5,271,001
Less: allowance for doubtful accounts		86,900

Total	$	5,184,101

Inventory at December 31, 2019 consists of:

Raw materials	$	3,149,272
Enclosures		452,845
Inventory reserve		(810,031	)

Total	$	2,792,086

			Accumulated
Item	Cost		Depreciation
Land	$	96,547	$	-
Buildings and improvements		2,315,577		440,793
Machinery and equipment		1,571,728		1,464,575
Vehicles		453,280		260,732
Furniture, fixtures, and computer equipment		349,248		290,574
		4,786,380	$	2,456,674
Less: accumulated depreciation		2,456,674
Total	$	2,329,706

Due to and from related individuals
Due From Officers - Loans to officers with no specific repayment terms and interest payable at the applicable AFR rate.	$	1,628,356

Income and expenses
Interest Income - Collected from Officers	$	27,536


Northeast Power Realty, LLC has two mortgages payable to a bank. The mortgages are due ranging from August 2021 to July 2032 in monthly payments ranging from $1,680 to $3,573 including interest payable at rates ranging from 4.12%to 4.875%. Subsequent to year end these mortgages were paid off as part of the sale of the business in 2020.	$	432,474

Less: current portion		42,641

Long-Term Portion	$	389,833

2020	$	42,641
2021		37,303
2022		26,298
2023		27,609
2024		28,986
Thereafter		269,637
Total	$	432,474

Cost of goods sold:
Beginning inventory	$	6,108,010
Materials		14,254,010
Labor		2,223,355
Commissions		542,242
Freight		488,357
Selling		21,910
Other		3,852
Ending inventory		(2,792,086	)
Total Cost Of Goods Sold	$	20,849,650

Operating expenses:
Officers' salaries	$	576,174
Other salaries		417,421
Health Insurance		337,975
Insurance		299,106
Payroll taxes		250,847
Profit sharing		150,002
Depreciation and amortization		142,467
Professional fees		112,692
Miscellaneous		59,491
Occupancy costs		49,234
Office expense		48,262
Bad debt		41,342
Utilities		40,846
Maintenance and repairs		16,015
Communication		12,883
Bank and finance charges		7,997
Waste disposal		4,022
Auto and travel		1,836
Contributions		1,200
Total Operating Expenses	$	2,569,812

					Pro Forma Adj				Combined
	AMSC As Reported		NEPSI As Reported		for Acquisition				Pro Forma
ASSETS
Current assets:
Cash and cash equivalents	$	41,246	$	122	$	(250	)	(m)	$	41,118
Marketable securities		10,191		-		-				10,191
Accounts receivable, net		16,810		1,452		-				18,262
Inventory		14,155		3,183		992		(a)		18,330
Prepaid expenses and other current assets		3,496		-		-				3,496
Restricted cash		508		-		-				508
Total current assets		86,406		4,757		742				91,905

Property, plant and equipment, net		8,140		2,073		242		(b)		10,455
Intangibles, net		3,309		-		7,300		(i)		10,609
Right-of-use assets		3,907		-		-				3,907
Goodwill		1,719		-		34,392		(l)		36,111
Restricted cash		5,782		-		-				5,782
Deferred tax assets		1,631		-		-				1,631
Other assets		333		-		-				333
Total assets	$	111,227	$	6,830	$	42,676			$	160,733

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable and accrued expenses	$	18,470	$	1,207	$	312		(d)	$	19,989
Contingent consideration		-		-		5,320		(c)		5,320
Other liabilities		-		250		(250	)	(m)		-
Lease liability, current portion		568		-		-				568
Deferred revenue, current portion		13,547		3,043		(343	)	(e)		16,247
Total current liabilities		32,585		4,500		5,039				42,124

Deferred revenue, long term portion		8,409		-		-				8,409
Lease liability, long term portion		3,430		-		-				3,430
Deferred tax liabilities		352		-		1,725		(f)		2,077
Other liabilities		31		-		-				31
Total liabilities		44,807		4,500		6,764				56,071

Stockholders' equity:
Common stock		234		279		(270	)	(g)		243
Additional paid-in capital		1,055,548		-		38,545		(g)		1,094,093

	Page
Condensed Consolidated Financial Statements (Unaudited)
Consolidated Balance Sheet as of September 30, 2020	3
Consolidated Statement of Income for the nine months ended September 30, 2020	4
Consolidated Statement of Stockholders’ and Members’ Equity for the nine months ended September 30, 2020	5
Consolidated Statement of Cash Flows for the nine months ended September 30, 2020	6
Notes to Condensed Consolidated Financial Statements	7-14


Net sales	$	15,493

Cost of goods sold		11,731

Gross profit		3,762

Operating expenses		1,649

Operating profit		2,113

Other income (expenses):
Gain on sale of property and equipment		341
Interest income		25
Interest expense		(17	)
Total other income (expenses), net		349

Consolidated Net Income	$	2,462

Net income attributable to non-controlling interest	$	98

Net income attributable to controlling interest		2,364

Consolidated Net Income	$	2,462

Investing activities:
Property and equipment expenditures		(15)
Proceeds from sale of property and equipment		491
Principal repayments on amounts due from officers		1,628
Net cash flows for investing activities		2,104

Financing activities:
Stockholders' and members' distributions, net		(8,919	)
Extinguishment of debt		(433)
Net cash flows for financing activities		(9,352	)

Net decrease in cash		(3,109)

Cash - beginning		3,231

Cash - ending	$	122

Supplemental disclosures of cash flows information:

Interest Paid	$	18

Accounts receivable at September 30, 2020 consist of:

Accounts receivable - trade	$	1,466
Less: allowance for doubtful accounts		14

Total	$	1,452

Inventory at September 30, 2020 consists of:

Raw materials	$	3,299
Work in progress		2,146
Finished goods		170
Inventory reserve		(2,432	)

Total	$	3,183

	Year Ended
	March 31, 2020
	AMSC As Reported			NEPSI As Reported		Pro Forma Adj for Acquisition				Combined Pro Forma
Revenues	$	63,838		$	28,780	$	(365	)	(h)	$	92,253

Cost of revenues		54,393			20,850		(65	)	(h) (i)		75,178

Gross margin		9,445			7,930		(300	)			17,075

Operating expenses:
Research and development		9,565			-		-				9,565
Selling, general and administrative		22,669			2,570		1,269		(d) (i)		26,508
Amortization of acquisition-related intangibles		340			-		-				340
Total operating expenses		32,574			2,570		1,269				36,413

Operating profit/(loss)		(23,129	)		5,360		(1,569	)			(19,338	)

Change in fair value of warrants		4,648			-		-				4,648
Interest income, net		1,327			13		-				1,340
Other (expense)/income, net		253			71		-				324
Income (loss) before income tax expense (benefit)		(16,901	)		5,444		(1,569	)			(13,026	)

Income tax expense (benefit)		195			-		(410	)	(j)		(215	)

Net income (loss)	$	(17,096	)	$	5,444	$	(1,159	)		$	(12,811	)

Net loss per common share
Basic	$	(0.81	)							$	(0.59	)
Diluted	$	(1.03	)							$	(0.79	)

Weighted average number of common shares outstanding
Basic		20,985					874		(k)		21,859
Diluted		21,069					874				21,943

	Six Months Ended
	September 30, 2020
	AMSC As Reported			NEPSI As Reported		Pro Forma Adj for Acquisition				Combined Pro Forma

Revenues	$	42,329		$	12,337	$	-			$	54,666

Cost of revenues		31,768			8,986		150		(i)		40,904

Gross margin		10,561			3,351		(150	)			13,762

Operating expenses:
Research and development		5,218			-		-				5,218
Selling, general and administrative		11,524			2,397		790		(d) (i)		14,711
Amortization of acquisition-related intangibles		242			-		-				242
Total operating expenses		16,984			2,397		790				20,171

Operating profit/(loss)		(6,423	)		954		(940	)			(6,409	)

Interest income, net		320			5		-				325
Other (expense)/income, net		(646	)		341		-				(305	)
Income (loss) before income tax expense (benefit)		(6,749	)		1,300		(940	)			(6,389	)

Income tax expense (benefit)		380			-		(246	)	(j)		134

Net income (loss)	$	(7,129	)	$	1,300	$	(694	)		$	(6,523	)

Net loss per common share
Basic	$	(0.33	)							$	(0.29	)
Diluted	$	(0.33	)							$	(0.29	)

Weighted average number of common shares outstanding
Basic		21,775					874		(k)		22,649
Diluted		21,775					874				22,649

Cash and Cash Equivalents	$	122
Net Working Capital (excl. Inventory and Deferred Revenue)		(5	)
Inventory		4,175
Property Plant and Equipment		2,315
Deferred Revenue		(2,700	)
Deferred Tax Liability		(1,725	)
Net tangible assets/(liabilities)		2,183

Backlog		600
Trade name		600
Customer Relationships		6,100
Net identifiable intangible assets/(liabilities)		7,300

Assembled workforce		600
Goodwill		33,792

Total purchase consideration	$	43,874

Cash Payment	$	26.000 million
Issuance of 873,657 shares of Company’s Common Stock	$	12.432 million
Earnout payment	$	5.320 million
Cash on hand	$	0.122 million

	(a)	To record adjustments to NEPSI's inventory to reflect the fair value of inventory, primarily work in progress, at the date of Acquisition. The related expense has not been included as an adjustment to cost of revenue in the pro forma statements of operations because its impact is not expected to recur beyond twelve months from the date of the Acquisition.

	(b)	To record an adjustment to NEPSI's property, plant and equipment to reflect the fair value of property, plant and equipment at the date of Acquisition. The related depreciation expense has not been included as an adjustment to operating expenses in the pro forma statements of operations because its impact is not expected to be material.


	Purchase Price Allocation		Estimated Useful Life (years)		Expense allocated for 12 months		Expense allocated for 6 months
Intangible asset
Contractual relationships / backlog	$	600,000		2	$	300,000	$	150,000
Total Cost of revenues amortization of intangible		600,000				300,000		150,000

Customer relationships		6,100,000		7		871,429		435,714
Trade names and trademarks		600,000		7		85,714		42,857
Total Selling, general and administrative amortization of intangibles		6,700,000				957,143		478,571

Total costs in excess of tangible assets	$	7,300,000			$	1,257,143	$	628,571

	(j)	To record an estimated income tax benefit on pro forma adjustments to income related to the Acquisition, at 26.14% effective tax rate.

	(k)	To reflect an increase in the weighted average shares outstanding for the period after giving effect to the issuance of AMSC common stock in connection with the Acquisition.


	(l)	To record the estimated value of goodwill acquired, which is estimated as the difference between the purchase price of $43.9 million and the estimated fair value of identifiable assets and liabilities. The goodwill recorded represents the anticipated incremental value of future cash flow potential attributable to the ability to grow the Grid business product lines though NEPSI leveraging its customer base and trade name.

	(m)	To eliminate a deposit received by NEPSI from the Company.