U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] Annual report under Section 13 or 15(d) of the Securities Exchange Act of
1934 (Fee required)
For the fiscal year ended March 31, 2000
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[_] Transition report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 (No fee required)
For the transition period from ____________ to ______________
Commission file number 0-5278
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IEH CORPORATION
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(Name of Small Business Issuer in Its Charter)
New York 13-5549348
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
140 58th Street, Suite 8E, Brooklyn, New York 11220
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(Address of Principal Executive Offices) (Zip Code)
(718) 492-9673
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(Issuer's Telephone Number, Including Area Code)
Securities registered under Section 12(b) of the Exchange Act:
Name of Each Exchange on Which
Title of Each Class Registered
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None None
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None None
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Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.50 Par Value
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(Title of Class)
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Indicated by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports),and (2) has been subject to such filing requirements for
past 90 days.
Yes X No
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Indicate by check mark if disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.
The Registrant's revenues for its most recent fiscal year ended March 31,
2000 were $4,486,573.
On June 20, 2000, the aggregate market value of the voting stock of
Registrant held by non-affiliates of Registrant (consisting of Common Stock,
$.50 par value) computed by reference to the closing bid price at which the
stock was sold on such date ($.2500) was approximately $258,546.
APPLICABLE ONLY TO CORPORATE REGISTRANTS
On June 20, 2000, there were 2,303,468 shares of Common Stock, $.50 par
value, issued and outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
None.
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IEH CORPORATION
PART I
Item I. Business
IEH Corporation (hereinafter referred to as the "Company") was
organized under the laws of the State of New York on March 22, 1943
under the name Industrial Heat Treating Company, Inc. On March 15,
1989, the Company changed its name to its current name. The Company's
executive offices and manufacturing facilities are located at 140 58th
Street, Suite 8E, Brooklyn, New York 11220. The Company's telephone
number is (718) 492-9673; its email address is [email protected].
The Industry in Which the Company is Engaged
The Company is engaged in the design, development, manufacture and
distribution of high performance electronic printed circuit connectors
and specialized interconnection devices. Electronic connectors and
interconnection devices are used to provide connections between
electronic component assemblies. The Company develops and manufactures
connectors which are designed for a variety of high technological and
high performance applications. These connectors are primarily utilized
by those users who require highly efficient and dense (the space
between connection pins within the connector) electrical connections.
Printed circuit boards in computers contain the components necessary
to perform specific system sub-functions. These functions require
connections which relay information between electronic components and
circuit boards, enabling the commands that are input by the user to be
performed. Electronic connectors, in essence, enable circuit boards
and electronic components to communicate with each other, via direct
electrical connection. Connectors also are fundamental to modular
construction of electronic assemblies enabling the disconnection and
removal of circuit boards and other electronic components for testing,
repair, and replacement.
Connectors may be designed and manufactured in various shapes, sizes
and specifications to meet specific customer requirements and
applications. High performance connectors are designed to meet various
density and pin count (the number of individual connection points
within each connector) criteria and to provide low forces (the amount
of pressure needed to make the connection) and electrically efficient
connections.
Constant advances in the design of solid state devices have resulted
in significantly denser component packaging configurations on circuit
boards. Historically, a 5" X 8" circuit board may have consisted of
thousands of circuits with 10 to 30 lines of communication. Under
those conditions, an insertion force of one pound per contact for each
of the communication lines formed a common and acceptable standard in
connection devices. As a result of technological developments in
recent years, the same 5" X 8" circuit board may contain hundreds of
thousands of circuits with hundreds of communication lines, and an
insertion force of one (1) ounce per contact as the standard in the
industry.
The Company's Product Line
The Company primarily manufactures printed circuit board connectors
that meet military or individual customer specifications. Certain of
the Company's manufacturing and sales involve the competitive bidding
process because of the military and/or government status of customers.
The Company also manufactures a line of standard universal connectors
which have common usage in the high technology and commercial
electronics industries. The Company serves both the commercial and
military marketplace, manufacturing connectors for avionics,
electronics, satellite, radar systems, test equipment, medical
electronic and related industries.
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IEH CORPORATION
Item I - The Business (continued)
The Company's Product Line (continued)
The Company is continuously redesigning and adapting its connectors to
keep pace with developments in the electronics industry, and has, for
example, developed connectors for use with flex-circuits which are
used in aerospace programs, computers, air-borne communication
systems, testing systems and other areas. The Company also provides
engineering services to its customers to assist in the development and
design of connectors to meet specific product requirements.
The Company's electronic printed circuit connectors are sold to
original equipment manufacturers and distributors. The Company
supplies its connectors to manufacturers who principally produce and
distribute finished products as well as to distributors who resell the
Company's products. Prior to the decrease in military and government
spending over the last five (5) years, the Company's sales were made
primarily to the government, military defense contractors and
aerospace companies. However, since the decrease in military and
government spending, the Company has modified its product line so as
to concentrate its sales efforts to commercial electronics companies.
The Company still continues to market its connectors for use in
government and military computers; military defense equipment and
information systems; terrestrial, airborne and aerospace
communications products; avionics and guidance systems and
instrumental and electronic testing equipment.
With the continuing downturn in government contracts over the last few
years, the Company has been striving the past several years to develop
commercial accounts.
Management has instituted several steps to increase productivity and
increase sales such as downsizing the labor force, implementing
material changes to make the Company's products more competitive and
developing machinery and equipment to increase production rates.
Management believes these initiatives have decreased costs and will
continue to do so in the near future.
For the fiscal year ended March 31, 2000, the Company's principal
customers included manufacturers of commercial electronics products,
military defense contractors and distributors who service these
markets. Sales to the commercial electronics and military defense
markets comprised 25% and 74%, respectively, of the Company's net
sales for the year ended March 31, 2000. Approximately 1% of the
Company's net sales for the year March 31, 2000, were made
internationally.
New Product Development
The Company maintains a program to increase the efficiency and
performance of its connectors to meet anticipated and specific market
needs. Computer and electronics technology is continuously changing
and requires the redesign and development of connectors to adapt to
these changes. Primarily, new technology has dictated a decrease in
the size of solid state electronic components and smaller and denser
high performance connectors. Management believes that a key ingredient
to the Company's success is its ability to assist customers with a new
design effort and prepare necessary drawing packages in a short period
of time. After the customer approves the design, prototypes are built,
approved by the customer and production is released. As an example,
six new connectors have been introduced to a major commercial account.
The Company's design effort on this product line began mid-year 1994
and was recently completed. The new development process with this
commercial client has led to substantial repeat business in the past
fiscal year. The Company now has the ability to introduce this line to
other commercial accounts.
The Company has also recently commenced production of two new
connectors for the aerospace industry.
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IEH CORPORATION
Item I - The Business (continued)
New Product Development (continued)
To date early orders for pre-production units have been completed and
the Company is awaiting commencement of production. One of the
nation's leading radar system manufacturers has contracted with the
Company for six new designs. The design work is complete, approvals
have been obtained, and the Company is now in small-scale production.
The Company anticipates full-scale production when the radar system is
released for sale by the customer.
Several years ago, the Company designed and developed a form of
compliant termination connector, which is named, "COMTAC". This
product, which utilizes technology known as "Solderless Pin
Technology", does not require the soldering of connector pins, but
instead utilizes a spring type locking system in attaching the
connector to the printed circuit board. This technology was patented
in the United States under patent No. 4,720,268 and assigned to the
Company on January 19, 1988. During the fiscal year ended March 31,
2000, sales of the COMTAC connectors accounted for over 10% of the
Company's total sales. The Company has sent pre-production units for
evaluation to certain customers and potential customers. Although
there can be no assurance of future sales, the Company is optimistic
that this new technology will lead to an increase in sales.
Commitments
On July 22, 1992, the Company obtained a loan of $435,000 from the New
York Urban Development Corporation ("NYUDC"), collateralized by
machinery and equipment. The loan is payable over ten years, with
interest rates progressively increasing from 4% to 8% per annum.
The balance remaining at March 31, 2000 was $135,057.
Aggregate future principal payments are as follows:
Fiscal Year Ending March:
2001 $53,929
2002 58,405
2003 22,723
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$135,057
In April 1997, the Company was informed by the NYUDC that the loan was
sold and conveyed to WAMCO XXIV, Ltd. All of the terms and conditions
of the loan remained in effect.
As of March 31, 2000, the Company had failed to meet one of the
financial covenants of the loan agreement; namely that the "Company
shall be obligated to maintain a tangible net worth of not less than
$1,300,000 and the Company shall be obligated to maintain a ratio of
current assets to current liabilities of 1.1 to 1.0.
The Company reported tangible net worth of $546,046. The ratio of
current assets to current liabilities was .94 to1.0.
The Company has applied for additional waivers of this covenant.
Neither the NYUDC or WAMCO XXIV, LTD. has acted on these requests.
There are no assurances that the Company will receive any additional
waivers of this covenant. Should the Company not receive any
additional waivers, then it will be deemed to be in default of this
loan obligation and the loan plus interest will become due and
payable.
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IEH CORPORATION
Item I - Business (continued)
Commitments (continued)
The Company has a collective bargaining multi-employer pension plan
with the United Auto Workers of America, Local 259. Contributions are
made in accordance with a negotiated labor contract and are based on
the number of covered employees employed per month. With the passage
of the Multi- Employer Pension Plan Amendments Act of 1990 ("The
Act"), the Company may become subject to liabilities in excess of
contributions made under the collective bargaining agreement.
Generally, these liabilities are contingent upon the termination,
withdrawal, or partial withdrawal from the Plan. The Company has not
taken any action to terminate, withdraw or partially withdraw from the
Plan nor does it intend to do so in the future. Under the Act,
liabilities would be based upon the Company's proportional share of
the Plan's unfunded vested benefits which is currently not available.
The amount of accumulated benefits and net assets of such Plan also is
not currently available to the Company. The total contributions
charged to operations under this pension plan were $32,120 for the
year ended March 31, 2000 and $35,640 for the year ended April 2,
1999.
As of March 31, 2000, the Company reported arrears with respect to its
contributions to the Union's health and welfare plan. The amount due
the health and welfare plan was $132,689.
The total amount due of $132,689 is reported on the accompanying
balance sheet in two components; $96,000 reported as a current
liability and $36,689 as a long-term liability.
In December 1993, the Company and Local 259 entered into a verbal
agreement whereby the Company would satisfy this debt by the following
payment schedule:
The sum of $8,000 will be paid by the Company each month in
satisfaction of the current arrears until this total debt has been
paid. Under this agreement, the projected payment schedule for arrears
will satisfy the total debt in 20 months. Additionally, both parties
have agreed that current obligatory funding for the Pension Plan will
be made on a timely current basis.
On June 30, 1995, the Company applied to the Pension Benefit Guaranty
Corporation ("PBGC") to have the PBGC assume all of the Company's
responsibilities and liabilities under its Salaried Pension Plan. On
April 26, 1996, the PBGC determined that the Salaried Pension Plan did
not have sufficient assets available to pay benefits which were and
are currently due under the terms of the Plan.
The PBGC further determined that pursuant to the provisions of the
Employment Retirement Income Security Act of 1974, as amended
("ERISA") that the Plan must be terminated in order to protect the
interests of the Plan's participants. Accordingly, the PBGC proceeded
pursuant to ERISA to have the Plan terminated and the PBGC appointed
as statutory trustee, and to have July 31, 1995 established as the
Plan's termination date.
At March 31, 2000 and April 2, 1999, $65,489 of the pension liability
is included in other current liabilities, with the balance of $516,966
shown as a long-term liability.
On those dates, the long-term portion includes $226,041, which
represents the recognition of the additional minimum liability to
comply with the requirements of Statement of Financial Accounting
Standards No. 87.
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IEH CORPORATION
Item I - Business (continued)
Commitments (continued)
In August 1998, the Company was notified by the PBGC that the Company
is liable to the PBGC for the following amounts as of September 1,
1998:
$ 456,418 representing the amount of unfunded benefit liabilities of
the Plan
$ 242,097 representing funding liability
$ 2,230 representing the premium liability
The total amount claimed by the PBGC amounts to $700,745. The Company
paid the premium liability of $2,230.00, thereby reducing the total
liability to $698,515 as of March 31, 2000.
The amount claimed is being contested by the Company, and the PBGC
granted the Company an extension of time until February 22, 1999 in
which to file an appeal. The Company did file an appeal and is
presently awaiting a response from the PBGC.
Marketing and Sales
The market for connectors and interconnection devices, domestic and
worldwide, is highly fragmented as a result of the manufacture by many
companies of a multitude of different types and varieties of
connectors. For example, connectors include: printed circuit,
rectangular I/O, circular, planar (IOC) RF coax, IC socket and fiber
optic. The Company has been servicing a niche in the market by
manufacturing HYPERTAC (TM) connectors and innovative Company-designed
printed circuit connectors such as the COMTAC connectors. Previously,
the Company was one of only three licensed manufacturers of the
HYPERTAC (TM) design in the United States. In the fiscal year 1996,
the Company learned that the other two licensees had merged. Moreover,
the Company, based upon advice of counsel, determined that the
HYPERTAC technology was no longer protected by a patent, and therefore
was in the public domain. As a result, the Company notified the
licensor that it would no longer be bound by the terms of its license
agreement and the Company ceased making license payments. See
Financial Statements and Notes thereto. The Company has received a
brief notice from the licensor that it disputed the Company's
interpretations and demanded return of certain equipment. No legal
proceedings have been instituted by the licensor and the Company has
not received any further notices. The Company does not anticipate
manufacturing other types of connectors in the immediate future. The
Company is continuously experimenting with innovative connection
designs, which may cause it to alter its marketing plans in the future
if a market should develop for any of its current or future innovative
designs.
The Company's products are marketed to original equipment
manufacturers directly and through distributors serving primarily the
government, military, aerospace and commercial electronics markets.
The Company is also involved in developing new connectors for specific
uses which result from changes in technology. This includes the COMTAC
connectors. The Company assists customers in the development and
design of connectors for specific customer applications. This service
is marketed to customers who require the development of connectors and
interconnection devices specially designed to accommodate the
customers own products.
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IEH CORPORATION
ITEM I - Business (continued)
Marketing and Sales (continued)
The Company is primarily a manufacturer and its products are
essentially basic components of larger assemblies of finished goods.
Approximately 95% of the Company's net sales for the years ended March
31, 2000 and April 2, 1999, respectively, were made directly to
manufacturers of finished products with the balance of the Company's
products sold to distributors.
Distributors often purchase connectors for customers who do not
require large quantities of connectors over a short period of time but
rather require small allotments of connectors over an extended period
of time.
Two (2) of the Company's customers accounted for 32% and 38% of the
Company's net sales for the years ended March 31, 2000 and April 2,
1999, respectively. One of the Company's customers accounted for 25%
and 31% of the Company's sales for the years ended March 31, 2000 and
April 2, 1999 respectively.
The Company currently employs 16 independent sales representatives to
market its products in all regions in the United States. These
independent sales representatives also promote the product lines of
other electronics manufacturers; however, they do not promote the
product lines of competitors which compete directly with the Company's
products. These sales representatives accounted for approximately 94%
of Company sales (with the balance of Company sales being generated
via direct customer contact) for the year ended March 31, 2000.
International sales accounted for less than 1% of sales for the years
ended March 31, 2000 and April 2, 1999.
Backlog of Orders/Capital Requirements
The backlog of orders for the Company's products amounted to
approximately $1,700,000 at March 31, 2000, as compared to $1,400,000
at April 2, 1999. A significant portion of these orders are subject to
cancellation or postponement of delivery dates and, therefore, no
assurance can be given that actual sales will result from these
orders. The estimated funds required to manufacture the current
backlog of orders is estimated at $660,000. The Company does not
foresee any problems which would prevent it from fulfilling its
orders.
Competition
The design, development, manufacture and distribution of electrical
connectors and interconnection devices is a highly competitive field.
The Company principally competes with companies who produce high
performance connectors in printed circuits and wireboards for high
technology application. The Company competes with respect to their
abilities to adapt certain technologies to meet specific product
applications; in producing connectors cost-effectively; and in
production capabilities. In addition, there are many companies who
offer connectors with designs similar to those utilized by the Company
and are direct competitors of the Company.
The primary basis upon which the Company competes is product
performance and production capabilities. The Company usually receives
job orders after submitting bids pursuant to customer- issued
specifications.
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IEH CORPORATION
Item I - Business (continued)
The Company also offers engineering services to its customers in
designing and developing connectors for specialized products and
specific customer applications. This enables the Company to receive a
competitive advantage over those companies who basically manufacture
connectors based solely or primarily on cataloged specifications. Many
of the Company's competitors have greater financial resources, market
penetration and experience than the Company and no assurances can be
given that the Company will be able to compete effectively with these
companies in the future.
Suppliers of Raw Materials and Component Parts
The Company utilizes a variety of raw materials and manufactured
component parts which it purchases from various suppliers. These
materials and components are available from numerous sources and the
Company does not believe that it will have a problem obtaining such
materials in the future. However, any delay in the Company's ability
to obtain necessary raw materials and component parts may affect its
ability to meet customer production needs. In anticipation of such
delays, the Company carries an inventory of raw materials and
component parts to avoid shortages and to insure continued production.
Engineering/Research & Development
The Company provides personalized engineering services to its
customers by designing connectors for specific customer applications.
The employment of electromechanical engineers is the anticipated
cornerstone of the Company's future growth. The Company maintains a
testing laboratory where its engineers experiment with new connector
designs based on changes in technology and in an attempt to create
innovative, more efficient connector designs.
The Company expended $69,600 for the years ended March 31, 2000 and
April 2, 1999, respectively, on Company sponsored research and
development activities relating to the development of new designs,
techniques and the improvement of existing designs. In addition, the
Company received revenues of $96,200 for the years ended March 31,
2000 and April 2, 1999, respectively, pursuant to customer sponsored
research activities.
Employees
The Company presently employs approximately 65 people, three (3) of
whom are executive officers; three (3) are engaged in management
activities; four (4) provide general and administrative services and
approximately 55 are employed in manufacturing and testing activities.
The employees engaged in manufacturing and testing activities are
covered by a collective bargaining agreement with the United Auto
Workers of America, Local 259 (the "Union") which expires on March 31,
2002. The Company believes that it has a good relationship with its
employees and the Union.
Patents and Licenses
Electrical connectors and interconnection devices are usually the
subject of standard designs; therefore, only innovations of standards
designs or the discovery of a new form of connector are patentable.
The Company is continuously attempting to develop new forms of
connectors or adaptations of current connector designs in an attempt
to increase performance and decrease per unit costs. The Company has
developed and designed the COMTAC connector which was patented on
January 19, 1988, at which time the patent was assigned to the
Company.
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IEH CORPORATION
Item I - Business (continued)
Governmental Regulations
The Company is subject to federal regulations under the Occupational
Safety and Health Act ("OSHA") and the Defense Electrical Supply
Command ("DESC"). OSHA provides federal guidelines and specifications
to companies in order to insure the health and safety of employees.
DESC oversees the quality and specifications of products and
components manufactured and sold to the government and the defense
industry. Although DESC continuously requires suppliers to meet
changing specifications, the Company has not encountered any
significant problems meeting such specifications and its products
have, in the past, been approved. The Company is unaware of any
changes in the government's regulations which are expected to
materially affect the Company's business.
Item 2. Properties
On December 1, 1998 the Company amended its lease on its premises by
surrendering a portion of its rented premises back to the landlord.
Accordingly, the base monthly rent was reduced to $ 10,397 or $121,764
per annum through December 1999 and to $9,397 or $112,764 per annum
through the conclusion of the lease which ends August 23, 2001.
The Company is obligated under this lease through August 23, 2001, at
minimum annual rentals as follows:
Fiscal year
ending:
2001 $112,764
========
The Company leases approximately 20,400 feet of space, of which it
estimates; 6,000 square feet are used as executive, sales and
administrative offices, 14,400 square feet are used for its
manufacturing and plating.
The net rental expense for the year ended March 31, 2000 for this
lease was $118,520. In addition to the base rent, the Company pays
real estate taxes, insurance premiums and utility charges relating to
the use of the premises. The Company considers its present facilities
to be adequate for its present and anticipated future needs. See
"Legal Proceedings" for certain matters involving the Company's
operating facility and offices.
Item 3. Legal Proceedings
The Company is not a party to or aware of any pending or threatened
legal proceedings which would result in any material adverse effect on
its operations or its financial condition.
As previously reported, the Company reached an agreement with its
landlord, the New York Economic Development Corporation ("NYEDC") to
settle certain matters related to the lease of its principal offices
located in Brooklyn, New York, including a lawsuit brought by the
NYEDC against the Company. The lawsuit, entitled New York City
Economic Development Corporation against IEH Corporation, had been
commenced in the Civil Court of the City of New York, Kings County
(Index No. L&T 88890/97).
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IEH CORPORATION
Item 3. Legal Proceedings (continued)
The NYEDC claimed that IEH had not paid the proper rent due under its
lease for the period from September 1, 1992 through April 1997. The
NYEDC claimed damages of $236,000 plus interest of approximately
$41,000.
The Company determined it was in its best interest to settle the
lawsuit. The parties agreed to a settlement, effective as of May, 1997
whereby the Company agreed to a repayment schedule for the amount due
payable with interest at 8.25% per year. The monthly installments
equal approximately $5,790 per month. The settlement provides for the
entity, following notice and a cure period, of a default judgement by
the NYEDC in the event the Company fails to pay amounts due under the
lease and the settlement in a timely fashion.
Item 4. Submission of Matters to Vote of Security Holders
No matters were submitted to shareholders during the fourth quarter
for the fiscal year ended March 31, 2000.
11
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IEH CORPORATION
PART II
Item 5. Market for Common Equity and Related Stockholder Matters
Principal Market
The Common Stock of the Registrant (the "Common Stock") is traded in
the Over-The-Counter Market and is quoted on the National Association
of Securities Dealers Automated Quotation ("NASDAQ") System Bulletin
Board under the symbol "IEHC"). On January 11, 1993, the Company's
Common Stock was deleted from listing on the NASDAQ SmallCap Market
System because of the Company's failure to maintain the minimum asset
and shareholders equity requirements. On January 12, 1993, the
Company's Common Stock was first quoted over the Electronic Bulletin
Board (OTCBB).
Market Information
The range of high and low bid prices for the Company's Common Stock,
for the periods indicated as set forth below. For the period to
October 29, 1991, the Company was listed on the NASDAQ National Market
System. On October 29, 1991, the Company's Common Stock was delisted
from the NASDAQ National Market System and from October 29, 1991 to
January 11, 1993, the Company's Common Stock was listed on the NASDAQ
SmallCap Market System. On January 11, 1993, the Company's Common
Stock was delisted from the NASDAQ SmallCap Market System and on
January 13, 1993, the Company's Common Stock was first quoted over the
Electronic Bulletin Board (OTCBB). Set forth below is a table
indicating the high and low bid prices of the Common Stock during the
periods indicated.
Year High Bid Low Bid
----------------------------------- -------- -------
Fiscal Year ended March 31, 2000(1)
1st Quarter $ .3125 $ .2500
2nd Quarter .3438 .2500
3rd Quarter .2500 .1250
4th Quarter .6875 .1250
Fiscal Year ended April 2,1999(1)
1st Quarter .6875 .3281
2nd Quarter .3438 .2812
3rd Quarter .3125 .2812
4th Quarter .2500 .2500
(1) As reported by the OTCBB.
The above quotations, as reported, represent prices between dealers
and do not include retail mark-ups, mark-downs or commissions. Such
quotations do not necessarily represent actual transactions.
On June 20, 2000 the high bid for the Common Stock was .25000 and the
low bid was .15625.
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IEH CORPORATION
PART II
Item 5. Market for Common Equity and Related Stockholder Matters (continued)
Dividends
The Company has not paid any cash dividends on its Common Stock during
the last five (5) fiscal years. At present, the Company does not
anticipate issuing any cash dividends on its Common Stock in the
foreseeable future by reason of its contemplated future financial
requirements and business plans. The Company will retain earnings, to
the extent that there are any, to finance the development of its
business.
Approximated Number of Equity Security Holders
The number of record holders of the Company's Common Stock as of June
20, 2000 was approximately 1,220. Such number of record owners was
determined from the Company's stockholder records, and does not
include the beneficial owners of the Company's Common Stock whose
shares are held in the names of various security holders, dealers and
clearing agencies.
Item 6. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations
The following table sets forth for the periods indicated, percentages
for certain items reflected in the financial data as such items bear
to the revenues of the Company:
<TABLE>
<CAPTION>
Relationship to Total Revenues
March 31, April 2,
2000 1999
--------------- --------------
<S> <C> <C>
Operating Revenues (in thousands) $4,487 $4,334
-------- --------
Operating Expenses:
(as a percentage of Operating Revenues)
Costs of Products Sold 71.8% 74.2%
Selling, General and Administrative 17.2% 19.5%
Interest Expense 3.1% 3.2%
Depreciation and amortization 6.7% 6.3%
-------- ---------
TOTAL COSTS AND EXPENSES 98.8% 103.2%
-------- ---------
Operating Income (loss) 1.2% (3.2%)
Other Income 0% 0%
-------- --------
Income (loss) before Income Taxes 1.2% (3.2%)
Income Taxes (.2%) (.3%)
-------- --------
Net Income (loss) 1.0% (3.5%)
======== ========
</TABLE>
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IEH CORPORATION
PART II
Item 6. Management's Discussion and Analysis of Financial Condition and
Results Of Operations (continued)
Results of Operations (continued)
Year End Results: March 31, 2000 Compared to April 2, 1999
Operating revenues for the year ended March 31, 2000 amounted to
$4,486,573 reflecting a 3.5% increase versus prior year 1999 revenues
of $4,334,477. The increase in revenues is a direct result of the
Company's continuing efforts to redirect its sales efforts to the
commercial and international electronic markets and away from the
governmental and military procurement sector.
Cost of products sold amounted to $3,219,798 for the fiscal year ended
March 31, 2000, or 71.8% of operating revenues. This reflected a
negligible increase in the cost of products sold from $3,214,927 or
74.2% of operating revenues for the fiscal year ended April 2, 1999.
This marginal increase is primarily due to management's efforts to
control manufacturing costs.
Selling, general and administrative expenses were $772,715 and
$847,358 or 17.2% and 19.5% of operating revenues for the fiscal years
ended March 31, 2000 and April 2, 1999, respectively. This category of
expense decreased 8.8% from the prior year. The decrease can be
primarily attributed to management's continuing efforts to control
expenses.
Interest expense was $141,159 for the fiscal year ended March 31, 2000
or 3.1% of operating revenues. For the fiscal year ended April 2,
1999, interest expense was $137,766 or 3.2% of operating revenues. The
increase of 2.5% reflects additional equipment loans obtained during
the year.
Depreciation and amortization of $298,558 or 6.7% of operating
revenues was reported for the fiscal year ended March 31, 2000. This
reflects an increase of 9.4 % from the prior year ended April 2, 1999
of $273,029 or 6.3% of operating revenues. The increase is a result of
additional acquisitions of new equipment and computers.
The Company reported a net income of $43,854 for the year ended March
31, 2000 representing basic earnings of $.019 per share as compared to
a net loss of $152,824 or $.066 per share for the year ended April 2,
1999. The net income increase for the current year can, in part, be
attributed to an increase in revenues from the commercial and
international sectors, as well as management's efforts to better
control costs and expenses.
Liquidity and Capital Resources
The Company reported working capital deficit of $111,044 as of March
31, 2000 compared to a working capital deficit of $188,877. The
increase in working capital of $77,833 was attributable to the
following items:
Net income (loss)
(excluding depreciation and amortization) 342,412
Capital expenditures (117,978)
Other transactions (146,601)
14
<PAGE>
IEH CORPORATION
PART II
Item 6. Management's Discussion and Analysis of Financial Condition and
Results of Operations (continued)
Liquidity and Capital Resources (continued)
As a result of the above, the current ratio (current assets to current
liabilities) was .94 to 1 at March 31, 2000 as compared to .90 to 1 at
April 2, 1999. Current liabilities at March 31, 2000 were $1,880,104
compared to $1,955,702 at April 2, 1999. This increase in the current
ratio is primarily reflective of an increase in inventory as well as a
decrease in account receivable financed.
The Company had $117,978 in capital expenditures in fiscal 2000
against depreciation of $298,558 for the year ended March 31, 2000.
The net income of $43,854 for the year ended March 31, 2000 increased
stockholders' equity to $546,046 as compared to stockholders' equity
of $502,192 at April 2, 1999.
The Company has an accounts receivable financing agreement with a
factor which bears interest at 2.5% above prime with a maximum of 12%
per annum. At March 31, 2000 the amount outstanding was $689,775 as
compared to $759,330 at April 2, 1999.
As of March 31, 2000 and as of April 2, 1999, the Company failed to
meet the tangible net worth covenant contained in its loan agreement
with the NYUDC. The Company has not been in compliance with this ratio
since fiscal year 1994. The Company received a waiver of this covenant
from the NYUDC for the period ending March 31, 1994. The Company has
requested a continued waiver from the NYUDC. To date, the NYUDC has
not declared an event of default. The Company has been notified that
the loan was recently sold by NYUDC to a third party. There are no
assurances that the Company will receive any additional waivers of
this covenant and therefore, the Company may be deemed to be in
noncompliance with its loan obligation to the NYUDC.
Effects of Inflation
The Company does not view the effects of inflation to have a material
effect upon its business.
Increases in costs of raw materials and labor costs have been offset
by increases in the price of the Company's products, as well as
reductions in costs of production, reflecting management's efforts in
this area. While the Company has in the past increased its prices to
customers, it has maintained its relatively competitive price
position. However, significant decreases in government, military
subcontractor spending has provided excess production capacity in the
industry which in turn has tightened pricing margins.
Item 7. Financial Statements
See Index to Financial Statements attached hereto.
Item 8. Changes in and Disagreements with Accountants on Accounting Financial
Disclosure.
The Company had no disagreements with its accountants during the last
two fiscal years.
15
<PAGE>
IEH CORPORATION
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16 (a) of the Exchange Act
The executive officers and directors of the Company are as follows:
Name Age Office
---- --- ------
Michael Offerman 59 Chairman of the Board of Directors and President
Robert Knoth 58 Secretary and Treasurer
Murray Sennet 77 Director
Allen Gottlieb 59 Director
Robert Pittman 75 Director
Joan Prideaux 67 Vice-President - Sales and Marketing
All directors serve for a term of two years and until their successors
are duly elected. All officers serve at the discretion of the Board of
Directors.
Executive Officers and Directors
Michael Offerman has been a member of the Board of Directors since
1973. In May, 1987, Mr. Offerman was elected President of the Company
and has held that position since that date. Prior to his becoming
President, Mr. Offerman served as Executive Vice-President of the
Company.
Robert Knoth joined the Company as Controller in January, 1990 and was
elected treasurer of the Company in March, 1990. Mr. Knoth was elected
as Secretary of the Company in September 1992 and Mr. Knoth has held
these positions since said dates. From 1986 to January, 1990, Mr.
Knoth was employed as controller by G&R Preuss, Inc., a company
engaged in the business of manufacturing truck bodies and accessories.
Murray Sennet has been a member of the Company's Board of Directors
since 1970. Mr. Sennet was the Secretary and the Treasurer of the
Company at the time of his retirement in April, 1986.
Allen Gottlieb has been a member of the Company's Board of Directors
since 1992. Mr. Gottlieb has been an attorney in private practice for
over five (5) years.
Robert Pittman has been a member of the Board of Directors since 1987.
Mr. Pittman retired in October 1992, at which time he had held the
position of Vice-President of Engineering and Secretary of the
Company.
16
<PAGE>
IEH CORPORATION
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16 (a) of the Exchange Act
Executive Officers and Directors (continued)
Joan Prideaux joined the Company in July, 1995 as National Sales
Manager. Prior to such time Ms. Prideaux was employed as an account
executive of Viking Connectors for the previous five years.
Now retired, Ralph Acello had been a member of the Board of Directors
since 1988. In August, 1984, Mr. Acello was elected the Company's
Vice-President of Production and held the position until his
retirement in November 1999.
Significant Employees
Thomas Hunt is the director of Quality Control, a position he has held
since October, 1992. Mr. Hunt joined the Company in 1987 as the
laboratory director and senior inspector and held said positions until
his promotion in October, 1992.
Stephen Reich is the Director of Purchasing, a position he has held
since July 1995. Prior to joining the Company, Mr. Reich owned and
operated a retail business.
Lawrence Schwartz is the Quality Control manager, a position he has
held since July 1997. Mr. Schwartz was employed by Precision
International a manufacturing company of automotive parts.
Certain Reports
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and officers and persons who own, directly or
indirectly, more than 10% of a registered class of the Corporation's
equity securities, to file with the Securities and Exchange Commission
("SEC") reports of ownership and reports of changes in ownership of
Common Stock of the Corporation. Officers, directors and greater than
10% shareholders are required to furnish the Company with copies of
all Section 16(a) reports that they file. Based solely on review of
the copies of such reports received by the Company, the Company
believes that filing requirements applicable to officers, directors
and 10% shareholders were complied with during the fiscal year.
Item 10. Executive Compensation
The following table sets forth below the summary compensation paid or
accrued by the Corporation during the fiscal years ended March 31,
2000, April 2, 1999, and March 27, 1998 for the Corporation's Chief
Executive Officer:
<TABLE>
<CAPTION>
Other Annual
Name and Principal Position Year Salary Bonus Compensation
--------------------------- ---- ------ ----- ------------
<S> <C> <C> <C> <C>
Michael Offerman, Chief March 31, 2000 $77,788 - 0
Executive officer, President(1) April 2, 1999 97,961 - 0
March 27, 1998 100,000 - 0
</TABLE>
17
<PAGE>
IEH CORPORATION
PART III
Item 10. Executive Compensation (continued)
(1) During the years ended March 31, 2000, April 2, 1999 and March 27,
1998, the Corporation provided automobile allowances to Mr. Offerman.
This does not include the aggregate incremental cost to the
Corporation of such automobile or automobile allowances. The
Corporation is unable to determine without unreasonable effort and
expense the specific amount of such benefit, however, the Corporation
has concluded that the aggregate amounts of such personal benefit for
Mr. Offerman does not exceed $25,000 or 10% of the compensation
reported as total salary and bonus reported. Effective January 1,
1995, Mr. Offerman entered into an employment agreement with the
Company to increase his salary to $100,000 per annum. Mr. Offerman
agreed that, not withstanding the terms of his new employment
agreement, he was paid at the rate of $77,788 for fiscal 2000. See
"Employment Agreements".
No other officer of the Corporation received compensation (salary and
bonus) in excess of $100,000 during the fiscal years ended March 31,
2000, April 2, 1999 or March 27, 1998.
Pension/Benefit Incentive Plan
In 1964, the Corporation's Shareholders and Board of Directors adopted
a contributory pension plan (the "Salaried Pension Plan") effective
April 1, 1964, for salaried employees of the Corporation. The Salaried
Pension Plan as revised on April 1, 1987, provides for retirement
benefits for qualified employees upon or prior to retirement. For
early retirement, employees are eligible to receive a portion of their
retirement benefits, starting 10 years prior to the employees
anticipated normal retirement age (age 65), if the employee has
completed 15 years of service to the Corporation. The employee is
eligible to receive reduced retirement benefits based on an actuarial
table for a period not exceeding ten (10) years of his lifetime. In no
event would benefits exceed $12,000 per year.
For normal retirement at the age of sixty-five (65) the employee is
entitled to receive full retirement benefits for a period not
exceeding ten (10) years of his lifetime. If the employee should die
prior to the ten-year period, his beneficiaries will continue to
receive the full benefit for the remainder of the ten- year term. In
no event will benefits exceed $12,000 per year.
If payment is made on the "joint and survivor basis" as elected by the
employee, benefits will be provided to both the employee and spouse on
a reduced basis over the life of both the employee and his spouse. If
the employee should die prior to the guaranteed ten year period, the
spouse will receive the employee benefit for the remainder of the
term, after which, the spouse will received the reduced spousal
benefit for the life of the spouse. In no event will the benefits
pursuant to the joint and survivor basis exceed $12,000 per year.
In June, 1995, the Company applied to the Pension Benefit Guarantee
Corporation for a distress termination of the Salaried Pension Plan.
The PBGC has notified the Company that it has agreed to take over the
Salaried Pension Plan. The PBGC has not issued its final order and may
require that the Company enter into an agreement to make future
payments to the PBGC.
Under an agreement dated June 16, 1978, the Corporation entered into a
retirement compensation agreement with Michael Offerman, which
provides that upon reaching the age of 65, or the earlier of death,
total disability, or employment termination by mutual consent, Michael
Offerman or his beneficiary would be entitled to retirement payments
of $30,000 per year for a period of five years.
18
<PAGE>
IEH CORPORATION
PART III
Item 10. Executive Compensation (continued)
Employment Agreements
In August, 1995, the Board of Directors approved the terms of an
employment agreement with Michael Offerman, its President and Chairman
of the Board. Effective as of January 1, 1995, the terms of he
Employment Agreement provide that Mr. Offerman's salary will be
$100,000 per year and that he will be employed as President of the
Company until a term expiring on December 31, 1999. Mr. Offerman
agreed to defer the increase in his salary from the previous year's
rate of compensation ($86,875) until October 20, 1995 and further
agreed to receive $92,404 in salary for the fiscal year ended April
2,1998. As further provided under the terms of the Employment
Agreement, the Company will provide certain benefits such as health
benefits and the use of a full size automobile during the term. The
Company also agreed to pay the premium for a $150,000 term life
insurance policy payable to Mr. Offerman's beneficiary. In the event
the Company declines to enter into a new employment agreement with Mr.
Offerman at the expiration of his term, the Company has agreed to pay
Mr. Offerman the sum of $75,000. Additionally, in the event there
occurs a "change of control" of the Company, and within the one (1)
year period thereafter Mr. Offerman's employment is terminated or he
resigns, then Mr. Offerman will be entitled to receive a sum equal to
the balance of his base salary for the remainder of the term plus
$75,000. A "change of control" is defined to mean (i) a person becomes
the holder of 30% or more of the combined voting power of the
Company's outstanding securities, (ii) the stockholders of the Company
approve a merger or consolidation whereby the Company's voting
securities fail to represent, after such merger or consolidation, at
least 50.1% of the voting securities of the surviving entity.
Additionally, in the event the Company relocates outside of the New
York City Metropolitan area, it has agreed to pay Mr. Offerman the sum
of $75,000. The Employment Agreement has expired.
In August, 1995, the Board of Directors approved the terms of an
employment agreement with Robert Knoth. Effective as of January 1,
1995, the terms of the Employment Agreement provide that Mr. Knoth's
salary will be $59,500 per year and that he will be employed as
Secretary and Treasurer until a term expiring on December 31, 1999. As
further provided under the terms of the Employment Agreement, the
Company will provide certain benefits such as health benefits. The
Company also agreed to pay the premium of a $150,000 term life
insurance policy payable to Mr. Knoth's beneficiary. In the event the
Company declines to enter into a new employment agreement with Mr.
Knoth at the expiration of his term, the Company has agreed to pay Mr.
Knoth the sum of $44,625. Additionally, in the event there occurs a
"change of control" of the Company, and within the one (1) year period
thereafter Mr. Knoth's employment is terminated or he resigns, then
Mr. Knoth will be entitled to receive a sum equal to the balance of
his base salary for the remainder of the term plus $44,625. A "change
of control" is defined to mean (i) a person becomes the holder of 30%
or more of the combined voting power of the Company's outstanding
securities, (ii) the stockholders of the Company approve a merger or
consolidation whereby the Company's voting securities fail to
represent, after such a merger or consolidation, at least 50.1% of the
voting securities of the surviving entity. Additionally, in the event
the Company relocates outside of the New York City Metropolitan area,
it has agreed to pay Mr. Knoth the sum of $44,625. The Employment
Agreement has expired.
In December 1997, the Board of Directors approved the terms of an
employment agreement with Joan Prideaux. The terms of the employment
agreement provide that Ms. Prideaux's salary will be $60,000 per year
and that she will be employed as Vice President-Sales and Marketing.
The agreement is for a period of five years. As further provided under
the terms of the employment agreement, the Company will provide
certain benefits such as health benefits. The Company also agreed to
pay the premium of a $150,000 term life insurance policy payable to
Ms. Prideaux's beneficiary.
19
<PAGE>
IEH CORPORATION
PART III
Item 10. Executive Compensation (continued)
Employment Agreements (continued)
In the event the Company declines to enter into a new employment
agreement with Ms. Prideaux at the expiration of the term, the Company
has agreed to pay Ms. Prideaux the sum of $42,750. Additionally, in
the event there occurs a "change of control" of the Company, and
within the one (1) year period thereafter Ms. Prideaux's employment is
terminated or he resigns, then she will be entitled to receive a sum
equal to the balance of her base salary for the remainder of the term
plus $42,750. A "change of control" is defined to mean (i) a person
becomes the holder of 30% or more of the combined voting power of the
Company's outstanding securities, (ii) the stockholders of the Company
approve a merger or consolidation whereby the Company's voting
securities fail to represent, after such a merger or consolidation, at
least 50.1% of the voting securities of the surviving entity.
Additionally, in the event the Company relocates outside of the New
York City Metropolitan area, it has agreed to pay Ms. Prideaux the sum
of $42,750.
Cash Bonus Plan
In 1987, the Company adopted a cash bonus plan ("Cash Bonus Plan") for
Executive Officers.
Contributions to the Bonus Plan are made by the Company only after
pre-tax operating profits exceed $150,000 for a fiscal year, and then
to the extent of 10% of the excess of the greater of $150,000 of 25%
of pre-tax operating profits. There were no contributions to the Bonus
Plan for the fiscal years ended March 31, 2000, April 2, 1999 and
March 27, 1998.
20
<PAGE>
IEH CORPORATION
PART III
Item 11. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information as of June 20, 2000
with respect to (i) the persons (including any "group" as that term is
used in Section 13(d)(3) of the Securities Exchange Act of 1934),
known by the Company to be the beneficial owner of more than five
percent (5%) of any class of the Company's voting securities; (ii)
each Executive Officer and Director who owns Common Stock in the
Company; and (iii) all Executive Officers and Directors as a group. As
of June 20, 2000, there were 2,303,468 shares of Common Stock issued
and outstanding.
<TABLE>
<CAPTION>
Amount of and
Name and Address of Nature of Beneficial
Title of Class Beneficial Owner Ownership Percentage of Class
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock $.50 Michael Offerman 399,784 17.4%
Par Value 140 58th Street
Brooklyn, NY 11220(1)
Murray Sennet 24,500 1.1%
1900 Manor Lane
Plano, TX 75093
Allen Gottlieb 0 0
325 Coral Way
Ft. Lauderdale. FL
33301
Robert Pittman 20,000 *
45 Ocean Avenue
Monmouth Bch, NJ
07750
Gerard Deiss
16 Rue De La Mart 547,000 23.7%
Chartreuil
6-68 490
Mere Par Montfort
L'Amaury, France(2)
David Lopez and 278,000 12.1%
Nancy Lopez
Edge of Woods
P.O. Box 323
Southampton, NY 11968
All Officers & Directors 444,284 19.3%
as a Group (4 in
number)
</TABLE>
21
<PAGE>
IEH CORPORATION
PART III
Item 11. Security Ownership of Certain Beneficial Owners and Management
(continued)
(Notes from previous page)
--------------------------
* Less than 1%.
1 43,600 shares of Common Stock are jointly owned by Mr. Offerman
and his wife, Gail Offerman.
2 These shares are beneficially owned by Mr. Deiss through a
Liechtenstein trust.
All shares set forth above are directly by the named individual unless
otherwise stated.
Item 12. Certain Relationships and Related Transactions
See "Executive Compensation-Employment Agreements" for a discussion of
the employment agreements between the Company and management.
Item 13. Exhibits, Lists and Reports on Form 8-K
(a) Exhibits filed with Form 10-KBS:
See annexed Exhibit index.
(b) Reports on Form 8-K
The Company did not file any Reports on Form 8-K during the last
quarter of the period covered by this Report.
22
<PAGE>
Signatures
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.
IEH CORPORATION
By: /s/ Michael Offerman
-----------------------------------
Michael Offerman, President
Dated: June 25, 2000
Pursuant to the requirements of the Securities Exchange Act of l934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
/s/ Michael Offerman June 25, 2000
--------------------------------------
Michael Offerman, Chairman of the
Board and President
/s/ Robert Knoth June 25, 2000
--------------------------------------
Robert Knoth, Secretary and
Treasurer
/s/ Murray Sennet June 25, 2000
--------------------------------------
Murray Sennet, Director
/s/ Robert Pittman June 25, 2000
--------------------------------------
Robert Pittman, Director
/s/ Alan Gottlieb June 25, 2000
--------------------------------------
Alan Gottlieb, Director
23
<PAGE>
IEH Corporation
Contents
March 31, 2000 and April 2, 1999
Page
Number
----------
Report of Independent Certified Public Accountant ` 25
Financial Statements:
Balance Sheets as of March 31, 2000 and April 2, 1999 26-27
Statement of Operations for the twelve months
ended March 31, 2000 and April 2, 1999 28
Statement of Stockholders' Equity as of March 31, 2000
and April 2, 1999 29
Statement of Cash Flows for the years ended March 31, 2000
and April 2, 1999 30-31
Notes to Financial Statements 32-40
25
<PAGE>
Report of Independent Certified Public Accountant
-------------------------------------------------
Board of Directors
IEH Corporation
We have audited the accompanying balance sheets of IEH Corporation as of March
31, 2000 and April 2, 1999 and the related statements of operations,
stockholders' equity, and cash flows for each of the two years in the period
ended March 31, 2000 and April 2, 1999. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based upon our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of IEH Corporation as of March 31,
2000 and April 2, 1999 and the results of its operations and its cash flows for
each of the two years ended March 31, 2000 and April 2, 1999 in conformity with
generally accepted accounting principles.
Jerome Rosenberg, CPA, P.C.
Melville, New York
May 25, 2000
25
<PAGE>
IEH CORPORATION
BALANCE SHEETS
As of March 31, 2000 and April 2, 1999
<TABLE>
<CAPTION>
March 31, April 2,
2000 1999
---- ----
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash $ 4,045 $ 15,120
Accounts receivable, less allowances for doubtful accounts
of $10,062 at March 31, 2000 and April 2, 1999 772,634 810,551
Inventories (Note 2) 976,169 926,471
Prepaid expenses and other current assets (Note 3) 16,212 14,683
---------- ----------
Total current assets 1,769,060 1,766,825
---------- ----------
PROPERTY, PLANT AND EQUIPMENT, less accumulated
depreciation and amortization of $5,075,854 at March 31, 2000
and $4,777,296 at April 2, 1999 (Note 4) 1,258,153 1,438,733
---------- ----------
OTHER ASSETS:
Prepaid pension cost (Note 11) 43,949 43,949
Other assets 46,378 46,622
---------- ----------
90,327 90,571
========== ==========
Total assets $3,117,540 $3,296,129
========== ==========
</TABLE>
See accompanying notes to financial statements
26
<PAGE>
IEH CORPORATION
BALANCE SHEETS
As of March 31, 2000 and April 2, 1999
<TABLE>
<CAPTION>
March 31, April 2,
2000 1999
---- ----
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
CURRENT LIABILITIES:
Accounts receivable financing (Note 5) $ 689,775 $ 759,330
Notes payable, equipment, current portion (Note 8) 19,555 25,333
Notes payable, current portion (Note 7) 66,009 60,798
Loans payable, current portion (Note 9) 53,929 50,693
Accrued corporate income taxes 16,020 15,352
Union pension and health & welfare, current portion (Note 12) 96,000 96,000
Accounts payable 779,686 769,893
Other current liabilities (Note 6) 159,130 178,303
--------- ---------
Total current liabilities 1,880,104 1,955,702
--------- ---------
LONG-TERM LIABILITIES:
Pension Plan payable (Note 11) 516,966 516,966
Notes payable, equipment, less current portion (Note 8) 50,858 52,936
Notes payable, less current portion (Note 7) 5,750 71,759
Loan payable, less current portion (Note 9) 81,127 133,747
Union pension & health & welfare, less current
portion (Note 12) 36,689 62,827
--------- ---------
Total long-term liabilities 691,390 838,235
--------- ---------
Total liabilities 2,571,494 2,793,937
--------- ---------
STOCKHOLDERS' EQUITY:
Common stock, $.50 par value; 10,000,000 shares
authorized, 2,303,468 shares issued and
outstanding at March 31, 2000 and at April 2, 1999 1,151,734 1,151,734
Capital in excess of par value 1,615,874 1,615,874
Retained earnings (Deficit) (2,221,562) (2,265,416)
----------- -----------
Total stockholders' equity 546,046 502,192
----------- -----------
Total liabilities and stockholders' equity $3,117,540 $3,296,129
=========== ===========
</TABLE>
See accompanying notes to financial statements
27
<PAGE>
IEH CORPORATION
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Years Ended
-----------
March 31, April 2,
2000 1999
------------------ -------------------
<S> <C> <C>
REVENUE, net sales (Note 14) $4,486,573 $4,334,477
---------- ----------
COSTS AND EXPENSES:
Cost of products sold 3,219,798 3,214,927
Selling, general and administrative 772,715 847,358
Interest expense 141,159 137,766
Depreciation and amortization 298,558 273,029
---------- ----------
4,432,230 4,473,080
---------- ----------
OPERATING INCOME (LOSS) 54,343 (138,603)
OTHER INCOME 711 810
---------- ----------
INCOME (LOSS) BEFORE INCOME TAXES 55,054 (137,793)
PROVISION FOR INCOME TAXES (11,200) (15,031)
---------- ----------
NET INCOME (LOSS) $ 43,854 $ (152,824)
========== ==========
Basic and Diluted Earnings per common share (Note 1) $ .019 $ (.066)
========== ==========
Weighted average number of common shares
outstanding (in thousands) 2,303 2,303
========== ==========
</TABLE>
See accompanying notes to financial statements
28
<PAGE>
IEH CORPORATION
STATEMENT OF STOCKHOLDERS' EQUITY
For the Years Ended March 31, 2000 and April 2,1999
<TABLE>
<CAPTION>
Capital in Excess Retained Earnings
Common Stock of Par Value (Deficit)
-------------------------------------- --------------------- ------------------------
Shares Amount
----------------- ----------------
<S> <C> <C> <C> <C>
Balances, March 27, 1998 2,303,502 $1,151,751 $1,615,874 $ (2,112,592)
Retirement of common stock at
September 25, 1998 (34) (17)
Net Loss: Year ended April 2, 1999 (152,824)
----------------- ---------------- --------------------- ------------------------
Balances, April 2, 1999 2,303,468 1,151,734 1,615,874 (2,265,416)
Net Income: Year ended March 31,
2000 43,854
----------------- ---------------- --------------------- ------------------------
Balances, March 31, 2000 2,303,468 $1,151,734 $1,615,874 $ (2,221,562)
================= ================ ===================== ========================
</TABLE>
See accompanying notes to financial statements
30
<PAGE>
IEH CORPORATION
STATEMENT OF CASH FLOWS
Increase (Decrease) in Cash
For the Twelve Months Ended March 31, 2000 and April 2,1999
<TABLE>
<CAPTION>
Years Ended
----------------------------------------
March 31, April 2,
2000 1999
------------------- -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 43,854 $ (152,824)
---------- -----------
Adjustments to reconcile net income to net cash used in
operating activities
Depreciation and amortization 298,558 273,029
Changes in assets and liabilities:
(Increase) decrease in accounts receivable 37,917 28,170
(Increase) decrease inventories (49,698) 22,811
(Increase) decrease in prepaid expenses and other current assets (1,529) 23,541
(Increase) decrease in other assets 244 807
(Decrease) increase in accounts payable 9,793 46,937
(Decrease) increase in other current liabilities (19,173) 54,277
Increase in accrued corporate income taxes 668 20
(Decrease) in due to union pension & health & welfare (26,138) (72,000)
---------- -----------
Total adjustments 250,642 377,592
---------- -----------
NET CASH PROVIDED BY (USED) FOR OPERATING ACTIVITIES 294,496 224,768
---------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment (117,978) (306,137)
---------- -----------
NET CASH USED IN INVESTING ACTIVITIES $(117,978) $(306,137)
---------- -----------
</TABLE>
See accompanying notes to financial statements
30
<PAGE>
IEH CORPORATION
STATEMENT OF CASH FLOWS
Increase (Decrease) in Cash
For the Twelve Months Ended March 31, 2000 and April 2, 1999
<TABLE>
<CAPTION>
March 31, April 2,
2000 1999
--------------------- ---------------------
<S> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Retirement of common shares $ - $ (17)
Principal payments on notes payable (87,539) (63,928)
Increase in notes payable 18,885 86,195
Proceeds from accounts receivable financing (69,555) 103,315
Principal payments on loan payable (49,384) (48,530)
------------ -----------
NET CASH PROVIDED BY (USED IN) FINANCING
ACTIVITIES (187,593) 77,035
-----------
INCREASE (DECREASE) IN CASH (11,075) (4,334)
CASH, beginning of period 15,120 19,454
------------ -----------
CASH, end of period $ 4,045 $ 15,120
============ ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION,
cash paid during the nine months for:
Interest $ 141,159 $ 137,766
============ ===========
Income Taxes $ 11,200 $ 15,031
============ ===========
</TABLE>
See accompanying notes to financial statements
31
<PAGE
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Description of Business:
The Company is engaged in the design, development, manufacture and
distribution of high performance electronic printed circuit connectors
and specialized interconnection devices. Electronic connectors and
interconnection devices are used in providing electrical connections
between electronic component assemblies. The Company develops and
manufactures connectors which are designed for a variety of high
technology and high performance applications, and are primarily
utilized by those users who require highly efficient and dense (the
space between connection pins with the connector) electrical
connections.
The Company is continuously redesigning and adapting its connectors to
meet and keep pace with developments in the electronics industry and
has, for example, developed connectors for use with flex-circuits now
being used in aerospace programs, computers, air-borne communications
systems, testing systems and other areas. The Company also services
its connectors to meet specified product requirements.
Accounting Period:
The Company maintains an accounting period based upon a 52-53 week
year which ends on the nearest Friday in business days to March 31st.
The year ended March 31, 2000 was comprised of 52 weeks and the year
ended April 2, 1999 was comprised of 53 weeks.
Revenue Recognition:
Revenues are recognized at the shipping date of the Company's
products.
Inventories:
Inventories are stated at cost, on a first-in, first-out basis, which
does not exceed market value.
Concentration of Credit Risk:
The Company maintains cash balances at one bank. Amounts on deposit
are insured by the Federal Deposit Insurance Corporation up to
$200,000 in aggregate. There were no uninsured balances at either
March 31, 2000 or April 2, 1999.
32
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Property, Plant and Equipment:
Property, plant and equipment is stated at cost less accumulated
depreciation and amortization. The Company provides for depreciation
and amortization using the straight-line method over the estimated
useful lives (3-10 years) of the related assets.
Maintenance and repair expenditures are charged to operations, and
renewals and betterments are capitalized. Items of property, plant and
equipment which are sold, retired or otherwise disposed of are removed
from the asset and accumulated depreciation or amortization account.
Any gain or loss thereon is either credited or charged to operations.
Income Taxes:
The Company follows the policy of treating investment tax credits as a
reduction in the provision for federal income tax in the year in which
the credit arises or may be utilized. Deferred income taxes arise from
temporary differences resulting from different depreciation methods
used for financial and income tax purposes. The Company has adopted
Statement of Financial Accounting Standards (SFAS) No. 109,
"Accounting for Income Taxes".
Net Income Per Share:
The Company has adopted the provisions of SFAS No. 128, "Earnings Per
Share", which requires the disclosure of "basic" and "diluted"
earnings (loss) per share. Basic earnings per share is computed by
dividing net income by the weighted average number of common shares
outstanding during each period. Diluted earnings per share is similar
to basic earnings per share except that the weighted average number of
common shares outstanding is increased to reflect the dilutive effect
of potential common shares, such as those issuable upon the exercise
of stock or warrants, as if they had been issued. For the years ended
March 31, 2000 and April 2, 1999, there were no differences between
basic and diluted earnings per share.
Fair Value of Financial Instruments:
The carrying value of the Company's financial instruments, consisting
of accounts receivable, accounts payable, and borrowings, approximate
their fair value.
Use of Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities, revenues and expenses, and disclosure of contingent
assets and liabilities at the date of the financial statements. Actual
amounts could differ from those estimates.
33
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued):
Impairment of Long-Lived Assets:
SFAS No. 121, "Accounting For The Impairment of Long-Lived Assets To
Be Disposed Of", requires that long-lived assets and certain
identifiable intangibles to be held and used by an entity be reviewed
for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. The
Company has adopted SFAS No. 121 effective March 31, 2000. There was
no impact of such adoption on the Company's financial condition and
results of operations.
Reporting Comprehensive Income:
The Company has adopted the provisions of SFAS No. 130, "Reporting
Comprehensive Income". This statement established standards for
reporting and display of comprehensive income and its components
(revenues, expenses, gains and losses) in an entity's financial
statements. This Statement requires an entity to classify items of
other comprehensive income by their nature in a financial statement
and display the accumulated balance of other comprehensive income
separately from retained earnings and additional paid-in capital in
the equity section of a statement of financial position. The adoptions
of SFAS No. 130 did not significantly impact on the Company's reported
net income (loss).
Segment Information:
The Company has adopted the provisions of SFAS No. 131, "Disclosures
About Segment of An Enterprise and Related Information." This
Statement requires public enterprises to report
financial and descriptive information about its reportable operating
segments and establishes standards for related disclosures about
product and services, geographic areas, and major customers. The
adoption of SFAS No. 131 did not affect the results of operations or
financial position. The disclosure of major customers is reported in
Note 15. Sales outside of the United States accounted for less than
one percent (1%) of total revenue.
Software Developed for Internal Use:
The Company provides for the capitalization of internal use of
computer software costs. These capitalized costs are amortized on a
straight-line basis over the useful life of the software.
Effect of New Accounting Pronouncements:
In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101, "Revenue Recognition Statements" (SAB
101), which provides additional guidance in applying generally
accepted accounting principles. The Company plans to adopt this
Statement as of April 1, 2000. The adoption of this Statement is not
expected to have a material impact on the Company's revenue
recognition policy.
34
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 2 - INVENTORIES:
Inventories are comprised of the following:
March 31, April 2,
2000 1999
------------------ ---------------
Raw materials $683,443 $702,176
Work in progress 190,480 122,606
Finished goods 102,246 101,689
-------- --------
$976,169 $926,471
======== ========
Note 3 - PREPAID EXPENSES AND OTHER CURRENT ASSETS:
Prepaid expenses and other current assets are comprised of the
following:
March 31, April 2,
2000 1999
--------------- -----------------
Prepaid insurance $14,613 $14,077
Other current assets 1,599 606
------- -------
$16,212 $14,683
======= =======
Note 4 - PROPERTY, PLANT AND EQUIPMENT:
Property, plant and equipment are as follows:
March 31, April 2,
2000 1999
-------------- ---------------
Computers $ 183, 808 $ 161,896
Leasehold improvements 585,831 583,206
Machinery and equipment 3,901,503 3,854,973
Tools and dies 1,502,849 1,455,938
Furniture and fixture 148,770 148,770
Transportation equipment 11,246 11,246
--------- ---------
6,334,007 6,216,029
Less: accumulated depreciation
and amortization 5,075,854 4,777,296
--------- ---------
$1,258,153 $1,438,733
========= =========
35
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 5 - ACCOUNTS RECEIVABLE FINANCING:
The Company entered into an accounts receivable financing agreement
whereby it can borrow up to eighty percent of its eligible receivables
(as defined in the agreement) at an interest rate of 2 1/2 % above The
Chase Manhattan Bank's publicly announced rate (9.0 %) at March 31,
2000, with a maximum of 12% per annum. The agreement has an initial
term of one year and will automatically renew for successive one year
terms, unless terminated by the Company or Lender upon receiving sixty
days prior notice. The loan is secured by the Company's accounts
receivable and inventories.
Note 6 - OTHER CURRENT LIABILITIES:
Other current liabilities are comprised of the following:
March 31, April 2,
2000 1999
-------------- ---------------
Payroll and vacation accruals $63,317 $ 77,787
Sales commissions 5,715 21,178
Pension plan payable 65,489 65,489
Other 24,609 13,849
-------------- ---------------
$159,130 $178,303
============== ===============
Note 7 - NOTES PAYABLE:
The Company was in arrears in the amount of $236,000 to the New York
City Economic Development Corporation ("NYCEDC") for rent due for its
offices and manufacturing facilities. In May 1997, the Company and the
NYCEDC negotiated an agreement for the Company to pay off its
indebtedness over a 48 month period, by the Company issuing notes
payable to NYCEDC. The note bears interest at the rate of 8.25% per
annum. The balance remaining at March 31, 2000 was $71,759, with
$66,009 being reported as a current liability and the remainder being
reported as a long-term liability. (See Note 12 - relating to lease
reduction).
Note 8 - NOTES PAYABLE EQUIPMENT:
The Company financed the acquisition of new computer equipment and
software with notes payable. The notes are payable over a sixty month
period. The balance remaining at March 31, 2000 amounted to $70,413.
36
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
NOTE 8 - NOTES PAYABLE EQUIPMENT (continued):
Aggregate future principal payments are as follows:
2001 19,555
2002 19,555
2003 19,532
2004 10,210
Thereafter 1,561
-------
$70,413
=======
Note 9 - LOAN PAYABLE:
On July 22, 1992, the Company obtained a loan of $435,000 from the New
York Urban Development Corporation ("NYUDC"), collateralized by
machinery and equipment. The loan is payable over ten years, with
interest rates progressively increasing from 4% to 8% per annum.
The balance remaining at March 31, 2000 was $135,057.
Aggregate future principal payments are as follows:
Fiscal Year Ending March:
2001 $ 53,929
2002 58,405
2003 22,723
---------
$ 135,057
=========
In April 1997, the Company was informed by the NYUDC that the loan was
sold and conveyed to WAMCO XXIV, Ltd. All the terms and conditions of
the loan remained in effect.
As of March 31, 2000, the Company had failed to meet one of the
financial covenants of the loan agreement; namely that the "Company
shall be obligated to maintain a tangible net worth of not less than
$1,300,000 and the Company shall be obligated to maintain a ratio of
current assets to current liabilities of 1.1 to 1.0.
The Company reported tangible net worth of $546,046. The ratio of
current assets to current liabilities was .94 to 1.0.
The Company has applied for additional waivers of this covenant.
Neither the NYUDC or WAMCO XXIV, Ltd. has acted on these requests.
There are no assurances that the Company will receive any additional
waivers of this covenant. Should the Company not receive any
additional waivers, then it will be deemed to be in default of this
loan obligation and the loan plus interest will become due and
payable.
37
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 10 - INCOME TAXES:
The Company has available at March 31, 2000, for federal income tax
purposes, a net operating loss carryforward of approximately
$2,158,000 of which approximately $1,724,000 will expire in 2007 with
the balance in 2017. In addition, the Company has unused investment
tax credits of approximately $86,000 which expire between 1999 and
2002.
Note 11 - PENSION PLAN-SALARIED PERSONNEL:
On June 30, 1995, the Company applied to the Pension Benefit Guaranty
Corporation ("PBGC") to have the PBGC assume all of the Company's
responsibilities and liabilities under its Salaried Pension Plan. On
April 26, 1996, the PBGC determined that the Salaried Pension Plan did
not have sufficient assets available to pay benefits which were and
are currently due under the terms of the Plan.
The PBGC further determined that pursuant to the provisions of the
Employment Retirement Income Security Act of 1974, as amended
("ERISA"), that the Plan must be terminated in order to protect the
interests of the Plan's participants. Accordingly, the PBGC proceeded
pursuant to ERISA to have the Plan terminated and the PBGC appointed
as statutory trustee, and to have July 31, 1995 established as the
Plan's termination date.
At March 31, 2000 and April 2, 1999, $65,489 of the pension liability
is included in other current liabilities, with the balance of $516,966
shown as a long-term liability.
On those dates, the long-term portion includes $226,041, which
represents the recognition of the additional minimum liability to
comply with the requirements of Statement of Financial Accounting
Standards No. 87.
In August 1998, the Company was notified by the PBGC that the Company
is liable to the PBGC for the following amounts as of September 1,
1998:
. $ 456,418 representing the amount of unfunded benefit liabilities
of the Plan
. $ 242,097 representing funding liability
The total payment claimed by the PBGC amounted to $698,515.
The amount claimed is being contested by the Company, and the PBGC
granted the Company an extension of time until February 22, 1999 in
which to file an appeal. The Company did file an appeal and is
presently awaiting a response from the PBGC.
38
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 12 - COMMITMENTS:
The Company had entered into employment agreements with certain
officers. The agreements provided for retirement compensation of
$30,000 per annum for a period of five years upon reaching either age
65, death, total disability or employment terminated by mutual consent
between the Company and the respective officer. Prior to March 26,
1993, all but one of these agreements had expired. The remaining
agreement is with the President of the Company.
On December 1, 1998 the Company amended its lease on its premises by
surrendering a portion of its rented premises back to the landlord.
Accordingly, the base monthly rent was reduced to $ 10,397 or $121,765
per annum through December 1999 and to $9,397 or $112,764 per annum
through the conclusion of the lease which ends August 23, 2001.
The Company is obligated under this lease through August 23, 2001, at
minimum annual rentals as follows:
Fiscal year ending:
2001 $112,764
========
The net rental expense for the year ended March 31, 2000 for this
lease was $118,520.
(See Note 7 - Notes Payable relating to rent arrears agreement)
The Company has a collective bargaining multi-employer pension plan
with the United Auto Workers of America, Local 259. Contributions are
made in accordance with a negotiated labor contract and are based on
the number of covered employees employed per month. With the passage
of the Multi-Employer Pension Plan Amendments Act of 1990 ("The Act"),
the Company may become subject to liabilities in excess of
contributions made under the collective bargaining agreement.
Generally, these liabilities are contingent upon the termination,
withdrawal, or partial withdrawal from the Plan. The Company has not
taken any action to terminate, withdraw or partially withdraw from the
Plan nor does it intend to do so in the future. Under the Act,
liabilities would be based upon the Company's proportional share of
the Plan's unfunded vested benefits which is currently not available.
The amount of accumulated benefits and net assets of such Plan also is
not currently available to the Company. The total contributions
charged to operations under this pension plan were $32,120 for the
year ended March 31, 2000 and $35,640 for the year ended April 2,
1999.
As of March 31, 2000, the Company reported arrears with respect to its
contributions to the Union's health and welfare plan. The amount due
the health and welfare plan was $132,689.
The total amount due of $132,689 is reported on the accompanying
balance sheet in two components; $96,000 reported as a current
liability and $36,689 as a long-term liability.
39
<PAGE>
IEH CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 12 - COMMITMENTS (continued):
In December 1993, the Company and Local 259 entered into a verbal
agreement whereby the Company would satisfy this debt by the following
payment schedule:
The sum of $8,000 will be paid by the Company each month in
satisfaction of the current arrears until this total debt has been
paid. Under this agreement, the projected payment schedule for arrears
will satisfy the total debt in 20 months. Additionally, both parties
have agreed that current obligatory funding for the Pension Fund will
be made on a timely current basis.
Note 13 - CHANGES IN STOCKHOLDERS' EQUITY:
Retained earnings (deficit) decreased by $43,854, which represents the
net income for the twelve months ended March 31, 2000.
Note 14 - REVENUES FROM MAJOR CUSTOMERS:
In the fiscal year ended March 31, 2000, more than 25% of the
Company's total revenues were earned from one customer. Total sales to
this customer were approximately $1,105,000.
40
<PAGE>
IEH CORPORATION
Exhibits
The following Exhibits have previously been filed with the Securities and
Exchange Commission and, pursuant to 17 C.F.R. Secs. 201.24 and 240.12b-32, are
incorporated by reference to the document referenced in brackets following the
descriptions of such Exhibits. Those Exhibits designated by an asterisk (*) are
filed herewith.
Exhibit No. Description
3.1 Amended and Restated Certificate of Incorporation of the
Company [Exhibit C-4 to Current Report filed on From 8-K,
dated February 27, 1991].
3.2 By-Laws of the Company Filed as Exhibit 3.2 on Report on
Form 10-KSB for the fiscal year ended March 27, 1994.
4.1 Form of Common Stock Certificate of Company. Filed as
Exhibit 4.1 on Report on Form 10-KSB for the fiscal year
ended March 27, 1994.
4.2 Form of Secured Promissory Note payable, New York State
Urban Development Corporation [Exhibit 10B to Current Report
on Form 8-K, dated July 22, 1992].
10.1 License Agreement between the Company and Brevetron, S.A.,
Lugano, Switzerland, dated January 1, 1979. Filed as Exhibit
10.1 on Report on Form 10-KSB for the fiscal year ended
March 27, 1994.
10.2 Amendment to License Agreement between the Company and
Brevetron, S.A. dated September 28, 1982. Filed as Exhibit
10.2 on Report on Form 10-KSB for the fiscal year ended
March 27, 1994.
10.3 Amendment to License Agreement between the Company and
Brevetron, S.A. dated September 20, 1991. Filed as Exhibit
10.3 on Report on Form 10-KSB for the fiscal year ended
March 27, 1994.
10.4 Lease for premises 140 58th Street, Brooklyn, New York 11220
[Exhibit A to Current Report filed on Form 8-K, dated August
23, 1991].
10.5 Form of Loan Agreement between the Company and the New York
State Urban Development Corporation [Exhibit 10A to Current
Report filed on Form 8-K, dated July 22, 1992].
41
<PAGE>
IEH CORPORATION
Exhibits (continued)
10.6 Form of Security Agreement between the Registrant and New
York State Urban Development Corporation [Exhibit 10C to
Current Report filed on Form 8-K, dated July 22, 1992].
10.7 Form of financing agreement between the Company and Milberg
Factors, Inc. [Exhibit C-1 to the Current Report filed on
Form 8- K, dated March 1, 1990].
10.8 Form of Collective Bargaining Agreement between Company and
Local 259 of the United Auto Workers Union, dated October 1,
1991.
10.9 Form of Employment Agreement between Company and Michael
Offerman together with Amendment No. 1 dated November
27,1997. [filed as Exhibit 10.9 to Form 10KSB for the fiscal
year ended March 28, 1997]
10.10 Form of Employment Agreement between the Company and Ralph
Acello together with Amendment No. 1 dated November
27,1997.[filed as Exhibit 10.10 to Form 10KSB for the fiscal
year ended March 28, 1997]
10.11 Form of Employment Agreement between the Company and Robert
Knoth together with Amendment No. 1 dated November
27,1997.[filed as Exhibit 10.11 to Form 10KSB for the fiscal
year ended March 28, 1997]
10.12 Form of Employment Agreement between the Company and Joan
Prideaux. [filed as Exhibit 10.12 to Form 10KSB for the
fiscal year ended March 28, 1997] 21. Subsidiaries: None
23.1* Consent of Jerome Rosenberg CPA, independent auditor of the
Company
27* EDGAR Financial Date Schedule
42
<PAGE>
IEH CORPORATION
Exhibits (continued)
99.1 Stipulation and Escrow Agreement dated December 18, 1997
between the Company and New York Economic Development
Corporation together with Stipulation, Consent and Final
Judgement.[filed as Exhibit 99.1 to Form 10-QSB for the
quarter ended December 26, 1997]
----------------------------
43
