Comtech Telecommunications Corp 10-Q for FY2024 Q3

Comtech Telecommunications Corp (CMTL)

10-Q 2024-06-18 For: 2024-04-30

Added on April 06, 2026

About this 10-Q

Comtech Telecommunications Corp filed this 10-Q on June 18, 2024, covering the quarter ended April 30, 2024 (FY2024 Q3).

Headline figures

Quarter ended April 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $128.08M; down 6.0% from $136.32M a year earlier
Net income: $2.8M; compared with a net loss of $7.46M a year earlier
Diluted EPS: -$0.04; compared with -$0.33 a year earlier

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Delaware						11-2139466
(State or other jurisdiction of incorporation /organization)						(I.R.S. Employer Identification Number)
305 N 54th Street, Chandler, Arizona						85226
(Address of principal executive offices)						(Zip Code)


COMTECH TELECOMMUNICATIONS CORP. INDEX
			Page
PART I. FINANCIAL INFORMATION

	Item 1.	Condensed Consolidated Financial Statements	2

		Condensed Consolidated Balance Sheets - April 30, 2024 and July 31, 2023 (Unaudited)	2

		Condensed Consolidated Statements of Operations - Three and Nine Months Ended April 30 2024 and 2023 (Unaudited)	3

		Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity - Three and Nine Months Ended April 30, 2024 and 2023 (Unaudited)	4

		Condensed Consolidated Statements of Cash Flows - Nine Months Ended April 30, 2024 and 2023 (Unaudited)	6

		Notes to Condensed Consolidated Financial Statements (Unaudited)	8

	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	39

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	62

	Item 4.	Controls and Procedures	62

PART II. OTHER INFORMATION

	Item 1.	Legal Proceedings	63

	Item 1A.	Risk Factors	63

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	64

	Item 4.	Mine Safety Disclosures	64

	Item 5.	Other Information	64

	Item 6.	Exhibits	65

		Signature Page	66


Assets	April 30, 2024		July 31, 2023
Current assets:
Cash and cash equivalents	$	27,192,000	18,961,000
Accounts receivable, net	199,646,000		163,159,000
Inventories, net	96,120,000		105,845,000
Prepaid expenses and other current assets	21,428,000		17,521,000

Total current assets	344,386,000		305,486,000
Property, plant and equipment, net	50,653,000		53,029,000
Operating lease right-of-use assets, net	33,791,000		44,410,000
Goodwill	333,105,000		347,692,000
Intangibles with finite lives, net	210,041,000		225,907,000
Deferred financing costs, net	1,722,000		2,349,000
Other assets, net	17,301,000		17,364,000
Total assets	$	990,999,000	996,237,000
Liabilities, Convertible Preferred Stock and Stockholders’ Equity
Current liabilities:
Accounts payable	$	54,520,000	64,241,000
Accrued expenses and other current liabilities	64,869,000		66,990,000
Current portion of long-term debt	3,712,000		4,375,000
Operating lease liabilities, current	8,014,000		8,645,000
Contract liabilities	61,014,000		66,351,000
Interest payable	1,256,000		1,368,000

Total current liabilities	193,385,000		211,970,000
Non-current portion of long-term debt	157,709,000		160,029,000
Operating lease liabilities, non-current	31,250,000		41,763,000
Income taxes payable, non-current	2,294,000		2,208,000
Deferred tax liability, net	8,231,000		9,494,000
Long-term contract liabilities	19,795,000		18,419,000
Other liabilities	1,662,000		1,844,000
Total liabilities	414,326,000		445,727,000
Commitments and contingencies (See Note 19)
Convertible preferred stock, par value $0.10 per share; authorized and issued 166,121 shares at April 30, 2024 (includes accrued dividends of $1,267,000) and authorized 125,000 shares; issued 100,000 at July 31, 2023 (includes accrued dividends of $604,000)	170,254,000		112,211,000
Stockholders' equity:
Preferred stock, par value $0.10 per share; authorized and unissued 1,833,879 and 1,875,000 shares at April 30, 2024 and July 31, 2023, respectively	—		—
Common stock, par value $0.10 per share; authorized 100,000,000 shares; issued 43,526,372 and 43,096,271 shares at April 30, 2024 and July 31, 2023, respectively	4,353,000		4,310,000
Additional paid-in capital	639,730,000		636,925,000
Retained earnings	204,185,000		238,913,000
	848,268,000		880,148,000
Less:
Treasury stock, at cost (15,033,317 shares at April 30, 2024 and July 31, 2023)	(441,849,000)		(441,849,000)
Total stockholders’ equity	406,419,000		438,299,000
Total liabilities, convertible preferred stock and stockholders’ equity	$	990,999,000	996,237,000


	Three months ended April 30,			Nine months ended April 30,
	2024		2023	2024		2023
Net sales	$	128,076,000	136,316,000	$	414,212,000	401,180,000
Cost of sales	89,122,000		93,170,000	284,178,000		265,307,000
Gross profit	38,954,000		43,146,000	130,034,000		135,873,000

Expenses:
Selling, general and administrative	28,697,000		31,397,000	91,699,000		89,649,000
Research and development	5,746,000		11,676,000	20,401,000		36,868,000
Amortization of intangibles	5,289,000		5,349,000	15,866,000		16,047,000
Loss (gain) on business divestiture, net	200,000		—	(2,013,000)		—
CEO transition costs	2,492,000		—	2,492,000		9,090,000


	42,424,000		48,422,000	128,445,000		151,654,000

Operating (loss) income	(3,470,000)		(5,276,000)	1,589,000		(15,781,000)

Other expenses (income):
Interest expense	5,146,000		4,386,000	15,343,000		10,412,000
Interest (income) and other	409,000		728,000	1,246,000		928,000

Change in fair value of warrants	(6,439,000)		—	(6,439,000)		—

Loss before (benefit from) provision for income taxes	(2,586,000)		(10,390,000)	(8,561,000)		(27,121,000)
(Benefit from) provision for income taxes	(5,381,000)		(2,932,000)	639,000		(3,762,000)


Net income (loss)	$	2,795,000	(7,458,000)	$	(9,200,000)	(23,359,000)

Loss on extinguishment of convertible preferred stock	—		—	(13,640,000)		—

Adjustments to reflect redemption value of convertible preferred stock:
Convertible preferred stock issuance costs	(76,000)		—	(4,349,000)		—

Dividend on convertible preferred stock	(3,759,000)		(1,766,000)	(7,643,000)		(5,213,000)
Net loss attributable to common stockholders	$	(1,040,000)	(9,224,000)	$	(34,832,000)	(28,572,000)

Net loss per common share (See Note 6):
Basic	$	(0.04)	(0.33)	$	(1.21)	(1.02)
Diluted	$	(0.04)	(0.33)	$	(1.21)	(1.02)

Weighted average number of common shares outstanding – basic	28,854,000		28,071,000	28,753,000		27,950,000

Weighted average number of common and common equivalent shares outstanding – diluted	28,854,000		28,071,000	28,753,000		27,950,000



	Three months ended April 30, 2024 and 2023
	Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Retained Earnings		Treasury Stock			Stockholders' Equity
	Shares	Amount		Shares	Amount						Shares	Amount
Balance as of January 31, 2023	100,000	$	108,651,000	42,900,871	$	4,290,000	$	630,233,000	$	253,422,000	15,033,317	$	(441,849,000)	$	446,096,000
Equity-classified stock award compensation	—	—		—	—		4,126,000		—		—	—		4,126,000

Issuance of employee stock purchase plan shares	—	—		12,146	1,000		126,000		—		—	—		127,000

Net settlement of stock-based awards	—	—		9,248	1,000		(294,000)		—		—	—		(293,000)
Adjustment to reflect redemption value of convertible preferred stock (including accrued dividends)		1,766,000		—	—		—		(1,766,000)		—	—		(1,766,000)

Reversal of dividend equivalents	—	—		—	—		—		22,000		—	—		22,000
Net loss	—	—		—	—		—		(7,458,000)		—	—		(7,458,000)
Balance as of April 30, 2023	100,000	$	110,417,000	42,922,265	$	4,292,000	$	634,191,000	$	244,220,000	15,033,317	$	(441,849,000)	$	440,854,000

Balance as of January 31, 2024	166,121	$	166,495,000	43,506,289	$	4,351,000	$	639,300,000	$	205,157,000	15,033,317	$	(441,849,000)	$	406,959,000
Equity-classified stock award compensation	—	—		—	—		404,000		—		—	—		404,000
Issuance of employee stock purchase plan shares	—	—		14,437	2,000		41,000		—		—	—		43,000

Net settlement of stock-based awards	—	—		5,646	—		(15,000)		—		—	—		(15,000)


Convertible preferred stock issuance costs	—	(76,000)		—	—		—		—		—	—		—
Adjustment to reflect redemption value of convertible preferred stock (including accrued dividends)	—	3,835,000		—	—		—		(3,835,000)		—	—		(3,835,000)
Reversal of dividend equivalents	—	—		—	—		—		68,000		—	—		68,000
Net income	—	—		—	—		—		2,795,000		—	—		2,795,000
Balance as of April 30, 2024	166,121	$	170,254,000	43,526,372	$	4,353,000	$	639,730,000	$	204,185,000	15,033,317	$	(441,849,000)	$	406,419,000


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


(480)			333-2200
(Registrant's telephone number, including area code)


	Nine months ended April 30, 2024 and 2023
	Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Retained Earnings		Treasury Stock			Stockholders' Equity
	Shares	Amount		Shares	Amount						Shares	Amount
Balance as of July 31, 2022	100,000	$	105,204,000	42,672,827	$	4,267,000	$	625,484,000	$	278,683,000	15,033,317	$	(441,849,000)	466,585,000
Equity-classified stock award compensation	—	—		—	—		6,298,000		—		—	—		6,298,000

CEO transition costs related to equity-classified stock-based awards (See Note 1)	—	—		—	—		3,764,000		—		—	—		3,764,000
Issuance of employee stock purchase plan shares	—	—		41,606	4,000		330,000		—		—	—		334,000
Issuance of restricted stock, net of forfeiture	—	—		93,091	9,000		(9,000)		—		—	—		—
Net settlement of stock-based awards	—	—		114,741	12,000		(1,676,000)		—		—	—		(1,664,000)
Adjustment to reflect redemption value of convertible preferred stock (including accrued dividends)		5,213,000		—	—		—		(5,213,000)		—	—		(5,213,000)
Cash dividends declared, net ($0.20 per share)	—	—		—	—		—		(5,549,000)		—	—		(5,549,000)
Accrual of dividend equivalents, net of reversal ($0.20 per share)	—	—		—	—		—		(342,000)		—	—		(342,000)
Net loss	—	—		—	—		—		(23,359,000)		—	—		(23,359,000)
Balance as of April 30, 2023	100,000	$	110,417,000	42,922,265	$	4,292,000	$	634,191,000	$	244,220,000	15,033,317	$	(441,849,000)	$	440,854,000

Balance as of July 31, 2023	100,000	$	112,211,000	43,096,271	$	4,310,000	$	636,925,000	$	238,913,000	15,033,317	$	(441,849,000)	$	438,299,000
Equity-classified stock award compensation	—	—		—	—		5,238,000		—		—	—		5,238,000

Issuance of employee stock purchase plan shares	—	—		38,554	4,000		215,000		—		—	—		219,000
Issuance of restricted stock, net of forfeiture	—	—		(2,686)	—		—		—		—	—		—
Net settlement of stock-based awards	—	—		394,233	39,000		(2,648,000)		—		—	—		(2,609,000)

Extinguishment of convertible preferred stock	(100,000)	(115,721,000)		—	—		—		(13,640,000)		—	—		(13,640,000)
Issuance of convertible preferred stock	166,121	166,121,000		—	—		—		—		—	—		—
Convertible preferred stock issuance costs	—	(4,349,000)		—	—		—		—		—	—		—
Adjustment to reflect redemption value of convertible preferred stock (including accrued dividends)	—	11,992,000		—	—		—		(11,992,000)		—	—		(11,992,000)


Reversal of dividend equivalents	—	—		—	—		—		104,000		—	—		104,000
Net loss	—	—		—	—		—		(9,200,000)		—	—		(9,200,000)
Balance as of April 30, 2024	166,121	$	170,254,000	43,526,372	$	4,353,000	$	639,730,000	$	204,185,000	15,033,317	$	(441,849,000)	$	406,419,000


Cash and cash equivalents	$	(71,000)
Accounts receivable, net	4,168,000
Inventories, net	17,822,000
Prepaid expenses and other current assets	201,000
Property, plant and equipment, net	2,790,000
Operating lease right-of-use assets, net	5,379,000
Goodwill	14,587,000
Other assets, net	35,000
Total assets of disposal group held for sale	$	44,911,000

Accounts payable	$	3,081,000
Accrued expenses and other current liabilities	1,622,000
Operating lease liabilities, current	545,000
Contract liabilities	656,000
Operating lease liabilities, non-current	4,894,000
Deferred tax liability, net	(451,000)
Total liabilities of disposal group held for sale	$	10,347,000


	Three months ended April 30, 2024					Nine months ended April 30, 2024
	Satellite and Space Communications		Terrestrial and Wireless Networks	Total		Satellite and Space Communications		Terrestrial and Wireless Networks	Total
Geographical region and customer type
U.S. government	$	43,546,000	593,000	$	44,139,000	$	138,253,000	1,762,000	$	140,015,000
Domestic	11,569,000		49,998,000	61,567,000		36,325,000		144,018,000	180,343,000
Total United States	55,115,000		50,591,000	105,706,000		174,578,000		145,780,000	320,358,000

International	16,330,000		6,040,000	22,370,000		77,858,000		15,996,000	93,854,000
Total	$	71,445,000	56,631,000	$	128,076,000	$	252,436,000	161,776,000	$	414,212,000
Contract type
Firm fixed-price	$	60,691,000	56,631,000	$	117,322,000	$	217,524,000	161,776,000	$	379,300,000
Cost reimbursable	10,754,000		—	10,754,000		34,912,000		—	34,912,000
Total	$	71,445,000	56,631,000	$	128,076,000	$	252,436,000	161,776,000	$	414,212,000
Transfer of control
Point in time	$	25,257,000	129,000	$	25,386,000	$	103,569,000	1,461,000	$	105,030,000
Over time	46,188,000		56,502,000	102,690,000		148,867,000		160,315,000	309,182,000
Total	$	71,445,000	56,631,000	$	128,076,000	$	252,436,000	161,776,000	$	414,212,000


	Three months ended April 30, 2023					Nine months ended April 30, 2023
	Satellite and Space Communications		Terrestrial and Wireless Networks	Total		Satellite and Space Communications		Terrestrial and Wireless Networks	Total
Geographical region and customer type
U.S. government	$	38,779,000	855,000	$	39,634,000	$	118,739,000	2,841,000	$	121,580,000
Domestic	12,146,000		47,555,000	59,701,000		41,819,000		141,542,000	183,361,000
Total United States	50,925,000		48,410,000	99,335,000		160,558,000		144,383,000	304,941,000

International	31,324,000		5,657,000	36,981,000		82,971,000		13,268,000	96,239,000
Total	$	82,249,000	54,067,000	$	136,316,000	$	243,529,000	157,651,000	$	401,180,000
Contract type
Firm fixed-price	$	68,010,000	54,067,000	$	122,077,000	$	210,343,000	157,651,000	$	367,994,000
Cost reimbursable	14,239,000		—	14,239,000		33,186,000		—	33,186,000
Total	$	82,249,000	54,067,000	$	136,316,000	$	243,529,000	157,651,000	$	401,180,000
Transfer of control
Point in time	$	30,870,000	268,000	$	31,138,000	$	152,157,000	1,994,000	$	154,151,000
Over time	51,379,000		53,799,000	105,178,000		91,372,000		155,657,000	247,029,000
Total	$	82,249,000	54,067,000	$	136,316,000	$	243,529,000	157,651,000	$	401,180,000


	April 30, 2024		July 31, 2023
Receivables from commercial and international customers	$	39,770,000	52,438,000
Unbilled receivables from commercial and international customers	76,932,000		54,469,000
Receivables from the U.S. government and its agencies	21,316,000		31,149,000
Unbilled receivables from the U.S. government and its agencies	64,334,000		27,192,000
Total accounts receivable	202,352,000		165,248,000
Less allowance for doubtful accounts	2,706,000		2,089,000
Accounts receivable, net	$	199,646,000	163,159,000


	April 30, 2024		July 31, 2023
Raw materials and components	$	73,811,000	87,139,000
Work-in-process and finished goods	40,801,000		43,365,000
Total inventories	114,612,000		130,504,000
Less reserve for excess and obsolete inventories	18,492,000		24,659,000
Inventories, net	$	96,120,000	105,845,000


	April 30, 2024		July 31, 2023
Accrued wages and benefits	$	18,060,000	21,994,000
Accrued contract costs	21,395,000		19,041,000
Accrued warranty obligations	6,992,000		8,285,000

Accrued commissions and royalties	4,948,000		4,659,000
Accrued legal costs	2,800,000		688,000
Other	10,674,000		12,323,000
Accrued expenses and other current liabilities	$	64,869,000	66,990,000


FORM			10-Q



Remainder of fiscal 2024	$	2,183,000
Fiscal 2025	8,123,000
Fiscal 2026	6,688,000
Fiscal 2027	4,582,000
Fiscal 2028	3,844,000
Thereafter	18,850,000
Total future undiscounted cash flows	44,270,000
Less: Present value discount	5,006,000
Lease liabilities	$	39,264,000

Weighted-average remaining lease terms (in years)	8.07
Weighted-average discount rate	3.47%


	Awards (in Shares)	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding at July 31, 2023	240,510	$	23.96

Expired/canceled	(6,250)	24.31

Outstanding at October 31, 2023	234,260	23.95

Expired/canceled	(9,680)	24.25

Outstanding at January 31, 2024	224,580	23.93

Expired/canceled	(54,430)	28.68

Outstanding at April 30, 2024	170,150	$	22.42	3.97	$	—

Exercisable at April 30, 2024	147,450	$	23.11	3.65	$	—

Vested and expected to vest at April 30, 2024	168,498	$	22.46	3.95	$	—


	Awards (in Shares)	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Outstanding at July 31, 2023	1,876,230	$	13.21
Granted	913,908	9.93
Settled	(296,198)	16.03
Canceled/Forfeited	(41,814)	15.80
Outstanding at October 31, 2023	2,452,126	11.60

Settled	(383,565)	10.64
Canceled/Forfeited	(41,927)	12.78
Outstanding at January 31, 2024	2,026,634	11.76

Settled	(9,642)	14.10
Canceled/Forfeited	(625,155)	8.47
Outstanding at April 30, 2024	1,391,837	$	13.22	$	2,616,653

Vested at April 30, 2024	451,975	$	14.99	$	849,713

Vested and expected to vest at April 30, 2024	1,333,129	$	13.19	$	2,506,283


	April 30, 2024		July 31, 2023
Term loan	$	27,512,000	$	48,125,000
Less unamortized deferred financing costs related to term loan	545,000		621,000
Term loan, net	26,967,000		47,504,000
Revolving loan facility	134,454,000		116,900,000
Amount outstanding under Prior Credit Facility, net	$	161,421,000	$	164,404,000
Less current portion of long-term debt	3,712,000		4,375,000
Non-current portion of long-term debt	$	157,709,000	$	160,029,000


			April 30, 2024
Stock options			170,150
Performance shares			379,353
RSUs, restricted stock, share units and other stock-based awards			1,012,484


Total			1,561,987


	April 30, 2024
	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization	Net Carrying Amount
Customer relationships	20.2	$	302,058,000	132,789,000	$	169,269,000
Technologies	14.8	113,149,000		82,058,000	31,091,000
Trademarks and other	16.7	32,926,000		23,245,000	9,681,000
Total		$	448,133,000	238,092,000	$	210,041,000


2024	$	21,154,000
2025	21,039,000
2026	19,888,000
2027	18,534,000
2028	18,534,000


($ in millions)	Fiscal Year 2023
Reconciliation of GAAP Net Loss to Adjusted EBITDA:
Net loss	$	(26.9)
Benefit from income taxes	(3.9)
Interest expense	15.0
Interest (income) and other	1.2

Amortization of stock-based compensation	10.1
Amortization of intangibles	21.4
Depreciation	11.9
Amortization of cost to fulfill assets	1.0
Restructuring costs	10.9
Strategic emerging technology costs	3.8
CEO transition costs	9.1
Adjusted EBITDA	$	53.5


	Three months ended April 30, 2024
($ in millions, except for per share amount)	Operating (Loss) Income		Net (Loss) Income Attributable to Common Stockholders		Net (Loss) Income per Diluted Common Share
Reconciliation of GAAP to Non-GAAP Earnings:
GAAP measures, as reported	$	(3.5)	$	(1.0)	$	(0.04)

Adjustments to reflect redemption value of convertible preferred stock		—		3.8		0.13
Change in fair value of warrants		—		(6.4)		(0.22)
Amortization of intangibles		5.3		4.1		0.14
Restructuring costs		2.8		2.1		0.07
CEO transition costs		2.5		1.9		0.07
Amortization of stock-based compensation		0.4		0.3		0.01
Strategic emerging technology costs		0.9		0.7		0.02
Amortization of costs to fulfill assets		0.2		0.2		0.01
Loss on business divestiture, net		0.2		0.2		0.01
Net discrete tax benefit		—		(0.2)		(0.01)
Non-GAAP measures	$	8.8	$	5.7	$	0.20


	Nine months ended April 30, 2024
($ in millions, except for per share amount)	Operating Income		Net (Loss) Income Attributable to Common Stockholders		Net (Loss) Income per Diluted Common Share
Reconciliation of GAAP to Non-GAAP Earnings:
GAAP measures, as reported	$	1.6	$	(34.8)	$	(1.21)
Loss on extinguishment of convertible preferred stock		—		13.6		0.47
Adjustments to reflect redemption value of convertible preferred stock		—		12.0		0.41
Change in fair value of warrants		—		(6.4)		(0.22)
CEO transition costs		2.5		1.9		0.07
Amortization of intangibles		15.9		12.3		0.42
Restructuring costs		9.2		7.1		0.24
Amortization of stock-based compensation		5.2		4.1		0.14
Strategic emerging technology costs		3.2		2.5		0.09
Amortization of cost to fulfill assets		0.7		0.7		0.02
Gain on business divestiture, net		(2.0)		(1.2)		(0.04)
Net discrete tax expense		—		0.8		0.03
Non-GAAP measures	$	36.3	$	12.5	$	0.43

	Nine months ended April 30, 2023
($ in millions, except for per share amount)	Operating (Loss) Income		Net (Loss) Income Attributable to Common Stockholders		Net (Loss) Income per Diluted Common Share
Reconciliation of GAAP to Non-GAAP Earnings:
GAAP measures, as reported	$	(15.8)	$	(28.6)	$	(1.02)
Adjustment to reflect redemption value of convertible preferred stock		—		5.2		0.19
Amortization of intangibles		16.0		12.4		0.44
CEO transition costs		9.1		8.6		0.31

Restructuring costs		7.0		5.4		0.19
Amortization of stock-based compensation		6.3		4.9		0.18
Strategic emerging technology costs		2.5		2.2		0.08
Amortization of cost to fulfill assets		0.7		0.7		0.03


Net discrete tax benefit		—		(0.7)		(0.03)
Non-GAAP measures	$	25.9	$	10.2	$	0.36



($ in thousands)	Total		Due Within 1 Year
Prior Credit Facility - principal payments	$	161,966	161,966
Prior Credit Facility - interest payments	7,479		7,479
Operating lease obligations	44,270		8,394
Contractual cash obligations	$	213,715	177,839



Date:	June 18, 2024	By: /s/ John Ratigan
	(Date)	John Ratigan
		Interim Chief Executive Officer
		(Principal Executive Officer)

Date:	June 18, 2024	By: /s/ Michael A. Bondi
	(Date)	Michael A. Bondi
		Chief Financial Officer
		(Principal Financial and Accounting Officer)


Performance Criteria for Full Three-Year Performance Period	Threshold	Target	Maximum
Fiscal 20XX – 20XX GAAP Revenue
Fiscal 20XX – 20XX Adjusted EBITDA
Fiscal 20XX – 20XX TSR


Performance Criteria for First Applicable Performance Period	Threshold	Target	Maximum
Fiscal [20XX] GAAP Revenue
Fiscal [20XX] Adjusted EBITDA
Fiscal [20XX] TSR


Performance Criteria for Second Applicable Performance Period	Threshold	Target	Maximum
Fiscal [20XX]-[20XX] GAAP Revenue
Fiscal [20XX]-[20XX] Adjusted EBITDA
Fiscal [20XX]-[20XX] TSR


			/s/ John Ratigan
			John Ratigan Interim Chief Executive Officer


			/s/ Michael A. Bondi
			Michael A. Bondi Chief Financial Officer