0001144204-18-003386.txt : 20180124 0001144204-18-003386.hdr.sgml : 20180124 20180124093622 ACCESSION NUMBER: 0001144204-18-003386 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 83 CONFORMED PERIOD OF REPORT: 20171031 FILED AS OF DATE: 20180124 DATE AS OF CHANGE: 20180124 FILER: COMPANY DATA: COMPANY CONFORMED NAME: R F INDUSTRIES LTD CENTRAL INDEX KEY: 0000740664 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC CONNECTORS [3678] IRS NUMBER: 880168936 STATE OF INCORPORATION: NV FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-13301 FILM NUMBER: 18544202 BUSINESS ADDRESS: STREET 1: 7610 MIRAMAR RD STREET 2: BLDG 6000 CITY: SAN DIEGO STATE: CA ZIP: 92126-2313 BUSINESS PHONE: 858-549-6340 MAIL ADDRESS: STREET 1: 7620 MIRAMAR RD #4100 STREET 2: 7620 MIRAMAR RD #4100 CITY: SAN DIEGO STATE: CA ZIP: 92126-4202 FORMER COMPANY: FORMER CONFORMED NAME: CELLTRONICS INC DATE OF NAME CHANGE: 19910204 10-K 1 tv483221_10k.htm 10-K

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

 

FOR ANNUAL AND TRANSITION REPORTS

PURSUANT TO SECTIONS 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

x       ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended October 31, 2017

 

or

 

¨       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ________________.

 

Commission File Number 0-13301

 

RF INDUSTRIES, LTD.

(Name of registrant as specified in its charter)

 

Nevada   88-0168936
(State or other jurisdiction   (I.R.S. Employer Identification No.)
of incorporation or organization)    

 

7610 Miramar Road, Bldg. 6000, San Diego, California 92126-4202

(Address of principal executive offices) (Zip Code)

(858) 549-6340

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, $.01 par value.

 

Securities registered pursuant to Section 12(g) of the Act:  None

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ¨ Yes x No

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ¨ Yes x No

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 the past 90 days.    x Yes    ¨ No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   x Yes     ¨ No

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K (§229.405 of this chapter) is not contained herein, 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-K or any amendment to this Form 10-K. ¨

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large Accelerated Filer ¨     Accelerated Filer ¨
Non-accelerated Filer ¨ (Do not check if a smaller reporting company)   Smaller reporting company x  
Emerging Growth Company  ¨    

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     ¨ Yes    x No

 

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold as of the last business day of the registrant’s most recently completed second fiscal quarter was approximately $9.3 million.

 

On January 22, 2018, the Registrant had 8,872,246 outstanding shares of Common Stock, $.01 par value.

 

 

 

 

 

Forward-Looking Statements:

 

Certain statements in this Annual Report on Form 10-K, and other oral and written statements made by the Company from time to time are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including those that discuss strategies, goals, outlook or other non-historical matters, or projected revenues, income, returns or other financial measures. In some cases forward-looking statements can be identified by terminology such as “may,” “will,” “should,” “except,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms or other comparable terminology. These forward-looking statements are subject to numerous risks and uncertainties that may cause actual results to differ materially from those contained in such statements. Among the most important of these risks and uncertainties are the ability of the Company to continue to source its raw materials and products from its suppliers and manufacturers, the market demand for its products, which market demand is dependent to a large part on the state of the telecommunications industry, the effect of future business acquisitions and dispositions, the incurrence of impairment charges, and competition.

 

Important factors which may cause actual results to differ materially from the forward-looking statements are described in the Section entitled “Risk Factors” in the Form 10-K, and other risks identified from time to time in the Company’s filings with the Securities and Exchange Commission. The Company assumes no obligation to update these forward-looking statements to reflect actual results or changes in factors or assumptions affecting such forward-looking statements.

 

PART I

 

ITEM 1.BUSINESS

 

General

 

RF Industries, Ltd. (together with subsidiaries, the “Company”) is a national manufacturer and marketer of interconnect products and systems, including coaxial and specialty cables and connectors, fiber optic cables and connectors, and electrical and electronic specialty cables and components. Through its four manufacturing and production facilities, the Company provides a wide selection of interconnect products and solutions primarily to telecommunications carriers and equipment manufacturers, wireless and network infrastructure carriers and manufacturers, Data Center and Co-location companies, and to various original equipment manufacturers (OEMs) in several market segments.

 

The Company operates through two reporting segments: (i) the “RF Connector and Cable Assembly” segment, and (ii) the “Custom Cabling Manufacturing and Assembly” segment. The RF Connector and Cable Assembly segment primarily designs, manufactures, markets and distributes a broad range of connector and cable products, including coaxial connectors and cable assemblies that are integrated with coaxial connectors, used in telecommunications, information technology, OEM markets and other end markets. The Custom Cabling Manufacturing and Assembly segment designs, manufactures, markets and distributes custom copper and fiber cable assemblies, complex hybrid fiber optic and power solution cables, electromechanical wiring harnesses, data center products, and wiring harnesses for a broad range of applications in a diverse set of end markets.

 

Until its sale on December 22, 2015, the Company also operated the Aviel Electronics Division, a Nevada based division that designed, manufactured and distributed specialty and custom RF connectors primarily for aerospace and military customers. In March 2016, the Company commenced the shutdown of its Bioconnect division, which comprised the entire operations of its medical cabling and interconnect operations. The closure of the Bioconnect division was part of the Company’s plan to close or dispose of underperforming divisions that are not part of the Company’s core operations.

 

Operating Segments

 

RF Connector and Cable Assembly Segment.

 

The Company’s RF Connector and Cable Assembly segment consists of the RF Connector and Cable Assembly division that is based at the Company’s headquarters in San Diego, California. Although most of the Company’s RF connector and cable products are inventoried and distributed from its San Diego facilities, some of these products also are inventoried and distributed from some of the Company’s other facilities. The RF Connector and Cable Assembly division is engaged in the design, manufacture and distribution of coaxial connector solutions for companies that design, build, operate, maintain and use wireless voice, data, messaging, and location tracking systems. Coaxial connector products consist primarily of connectors which, when attached to a coaxial cable, facilitate the transmission of analog and digital signals in various frequencies.

 

Although most of the connectors are designed to fit standard products, the RF Connector and Cable Assembly division also sells custom connectors specifically designed and manufactured to suit its customers’ requirements such as the Distributed Area Systems (DAS), Wi-Fi and broadband wireless markets. The Company’s RF Connector and Cable Assembly division typically carries over 1,500 different types of connectors, adapters, tools, and test and measurements kits. This division’s RF connectors are used in thousands of different devices, products and types of equipment. Since the RF Connector and Cable Assembly division’s standard connectors can be used in a number of different products and devices, the discontinuation of one product typically does not make the Company’s connectors obsolete. Accordingly, most connectors carried by the Company can be marketed for a number of years and are only gradually phased out. Furthermore, because the Company’s connector products are not dependent on any single line of products or any market segment, the Company’s overall sales of connectors tend to fluctuate less materially when there are material changes or disruption to a product line or market segment. Sales of the Company’s connector products can, however, be influenced by the infrastructure spend of wireless and telecommunications firms and on the Company’s ability to market its products into these firms and the related ecosystem. The current deployment of wireless through DAS and Small Cells provides the Company with a market opportunity for the use of its connectors and cable assemblies.

 

 2 

 

 

Cable assembly products manufactured and sold by the RF Connector and Cable Assembly division consist of various types of coaxial cables that are attached to connectors (usually the Company’s connectors) for use in a variety of communications applications. Cable assemblies manufactured for the RF Connector and Cable Assembly division are primarily manufactured at the Company’s San Diego, California facilities using state-of-the-art automation equipment and are sold through distributors or directly to major OEMs. Cable assemblies consist of both standard cable assemblies and assemblies that are custom manufactured for the Company’s clients. The Company offers a line of cable assemblies with over 100,000 cable product combinations. The cable assembly operation was launched in 2000.

 

The Company designs its connectors at its headquarters in San Diego, California. However, most of the RF connectors are manufactured for the Company by third party foreign manufacturers located in Asia.

 

Custom Cabling Manufacturing and Assembly Segment.

 

The Custom Cabling Manufacturing and Assembly Segment currently consists of three wholly-owned subsidiaries located in the Northeastern United States. The three subsidiaries were acquired by the Company in the recent past. Each of the three provides products and solutions to a diverse and distinct customer set from each other and from the RF Connector and Cable Assembly Segment.

 

Cables Unlimited Division Cables Unlimited, Inc. is a custom cable manufacturer that RF Industries, Ltd. purchased in 2011. Cables Unlimited’s offices and manufacturing facilities are located in Yaphank, New York. Cables Unlimited is a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products that are backed by Corning Cable Systems' extended warranty. Cables Unlimited designs, develops and manufactures custom connectivity solutions for the industrial, defense, telecommunications and wireless markets.  The products sold by Cables Unlimited include custom and standard copper and fiber optic cable assemblies, adapters and electromechanical wiring harnesses for communications, computer, LAN, automotive fiber optic and medical equipment. In 2012, Cables Unlimited introduced a custom cabling solution known as OptiFlex. The OptiFlex cable is a hybrid power and communications cable primarily designed and built for wireless service providers who are updating their network infrastructure to support current and next generation wireless technologies including 4G and 5G.

 

Comnet Telecom Supply Division RF Industries, Ltd. purchased Comnet Telecom Supply, Inc. in January 2015. Comnet Telecom’s offices and manufacturing facilities are located in East Brunswick, New Jersey. Formed in 1995, Comnet Telecom is a Corning Cable Systems CAH Connections SM Gold Program member that is authorized to manufacture fiber optic telecommunications products that are backed by Corning Cable Systems' extended warranty and is a Telcordia GR-326 certified manufacturer. Comnet Telecom manufactures and distributes telecommunications equipment and cabling infrastructure products used by telecommunications carriers, co-location service companies, and other telecommunication and data center companies in the U.S. across multiple industries. Comnet Telecom is also a supplier of Hot/Cold Aisle Containment as well as Technology Furnishing Solutions in addition Comnet has developed an offering of data center filler panel containment products.

 

Rel-Tech Electronics Division RF Industries, Ltd. purchased Rel-Tech Electronics, Inc. in June 2015. Rel-Tech’s offices and manufacturing facilities are located in Milford, Connecticut. Founded in 1986, Rel-Tech is a designer and manufacturer of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation, medical and military customers. Wire and cable assembly products include custom wire harnesses, ribbon cable, electromechanical and kitted assemblies, and networking and communications cabling. DIN and Mini-DIN connector assemblies include power cord, coaxial, Mil-spec, and testing.

 

Product Description

 

The Company produces a broad range of interconnect products and assemblies. The products that are offered and sold by the Company consist of the following:

 

Connector and Cable Products

 

The Company’s RF Connector and Cable Assembly division designs, manufactures and markets a broad range of coaxial connectors, coaxial adapters and coaxial cable assemblies for the numerous products with applications in commercial, industrial, automotive, transportation, scientific, aerospace and military markets. Various types of products/connectors are offered including passive DAS related items such as connectors, adapters, splitters, couplers and loads. These connectors are offered in several configurations and cable attachment methods for customer applications. There are numerous applications for these connectors, some of which include digital applications, 2.5G, 3G, 4G, 5G, LTE and other broadband wireless infrastructure, GPS (Global Positioning Systems), mobile radio products, aircraft, video surveillance systems, cable assemblies and test equipment. Users of the Company’s connectors include telecommunications companies, circuit board manufacturers, OEMs, consumer electronics manufacturers, audio and video product manufacturers and installers, and satellite companies. The Company markets over 1,500 types of connectors, adapters, tools, assembly, test and measurement kits, which range in price from under $1 to over $1,000 per unit. The kits satisfy a variety of applications including, but not limited to, lab operations, site requirements and adapter needs.

 

 3 

 

 

The Company designs and sells a variety of connector tools and hand tools that are assembled into kits used by lab and field technicians, R&D technicians and engineers. The Company also designs and offers some of its own tools, which differ from those offered elsewhere in the market. These tools are manufactured for the Company by outside contractors. Tool products are carried as an accommodation to the Company’s customers and have not materially contributed to the Company’s revenues.

 

In addition and as a result of the acquisition of the CompPro Product Line, the Company markets and manufactures a patented compression technology that offers revolutionary advantages for a water-tight, ruggedized connection, providing easier installation, and improved system reliability on braided cables. CompPro is used by wireless network operators, installers and distributors in North America and other parts of the world.

 

The Cable Assembly component of the Connector and Cable Assembly division markets and manufactures cable assemblies in a variety of sizes and combinations of RF coaxial connectors and coax cabling. Cabling is purchased from a variety of major unaffiliated suppliers and is assembled predominately with the Company’s connectors or other brands of connectors as complete cable assemblies. Coaxial cable assemblies have numerous applications including low PIM, wireless and wireless local area networks, wide area networks, internet systems, cellular systems including 2.5G, 3G, 4G, 5G, LTE wireless infrastructure, DAS and Small Cell implementations, TV/dish network systems, test equipment, military/aerospace (mil-standard and COTS (Commercial Off The Shelf)) and entertainment systems. Cable assemblies are manufactured to customer requirements.

 

Cables Unlimited Products

 

Cables Unlimited is an International Standards Organization (ISO) approved factory that manufactures custom cable assemblies. Cables Unlimited is also a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products that are backed by Corning Cable Systems' extended warranty. Products manufactured by Cables Unlimited include custom copper and fiber optic cable assemblies, adapters and electromechanical wiring harnesses for telecommunications, computer, LAN, automotive and medical equipment companies. Cables Unlimited also provides cable installation services in the New York regional area. In April 2012, Cables Unlimited commercially released a cabling solution for wireless service providers engaged in upgrading their cell towers for 4G technologies. The custom hybrid cable, called OptiFlex, is significantly lighter and possesses greater flexibility than cables previously used for wireless service. Most of the products that Cables Unlimited develops and sells are built specifically for its customers’ needs.

 

The acquisition of Cables Unlimited in 2011 gave the Company the ability to offer a broad range of interconnect products and systems to the Company’s largest customers. These interconnect systems have the ability to combine radio frequency and fiber optic interconnect components, with various connectors and power cables through customized solutions for these customers. The Company continues to actively market its ability to provide these fiber optic interconnect solutions to its larger customers.

 

Comnet Telecom Products

 

Comnet Telecom manufactures and distributes both standard and custom equipment and cabling products used by telecommunications carriers, co-location center operators and other telecommunication and data center companies in the U.S. Such products include fiber optics cable, copper cabling, custom patch cord assemblies, transceivers/converters, data center consoles and other data center equipment (such as server cabinets and network racks). The acquisition of Comnet Telecom expands the Company’s fiber optic cabling capabilities and the customer base to which the Company can sell its other cabling products. The opportunities are further enhanced to sell Comnet data center infrastructure and telecom products into our cable product customer base.

 

Rel-Tech Electronics Products

 

Rel-Tech is a designer and manufacturer of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation, medical and military customers. Wire and cable assembly products include custom wire harnesses, ribbon cable, electromechanical and kitted assemblies, networking and communications cabling. DIN and Mini DIN connector assemblies include power cord, coaxial, Mil-spec and testing.

 

Foreign Sales

 

Net sales to foreign customers accounted for $700,000 (or approximately 2%) of the Company’s net sales, and $1.0 million (or approximately 3%) of the Company’s sales, respectively, for the fiscal years ended October 31, 2017 and 2016. The majority of the export sales during these periods were to Canada and Mexico.

 

The Company does not own, or directly operate any manufacturing operations or sales offices in foreign countries.

 

 4 

 

 

Distribution, Marketing and Customers

 

The Company deploys various sales methods depending upon the market being serviced. The Company currently sells products primarily through warehousing distributors to address the wireless, telecom, and data center markets and direct to OEM customers who utilize coaxial connectors and cable assemblies and harnesses in the manufacture of their own products and solutions.

 

Backlog

 

The Company estimates that its backlog of unfulfilled orders as of October 31, 2017 was approximately $4.0 million on a consolidated basis, compared with a backlog of approximately $3.3 million as of October 31, 2016.  The Company does not have any long-term supply agreements, and most of its purchase orders have short lead times. Therefore, backlog may not be indicative of future demand. The Company expects that all or substantially all of the backlog will be filled within the next 12 months.

 

Manufacturing

 

The RF Connector and Cable Assembly division contracts with outside third parties for the manufacture of a significant portion of its coaxial connectors. However, virtually all of the RF cable assemblies sold by the RF Connector and Cable Assembly division during the fiscal year ended October 31, 2017 were assembled by the Cable Assembly side of the RF Connector and Cable Assembly division at the Company’s approved ISO factory in California. The RF Connector and Cable Assembly division procures its raw cable from manufacturers with ISO approved factories in the United States, China and Taiwan. The Company is dependent primarily on twelve manufacturers for its coaxial connectors, tools and other passive components and several plants for raw cable. Although the Company does not have manufacturing agreements with these manufacturers for its connectors and cable products, the Company does have long-term purchasing relationships with these manufacturers. There are certain risks associated with the Company’s dependence on third-party manufacturers for some of its products. See “Risk Factors” below. The Company has in-house design engineers who create the engineering drawings for fabrication and assembly of connectors and cable assemblies. Accordingly, the manufacturers are not primarily responsible for design work related to the manufacture of the connectors and cable assemblies.

  

Cables Unlimited manufactures its custom cable assemblies, adapters and electromechanical wiring harnesses and other products in its Yaphank, New York manufacturing facility. Cables Unlimited is an ISO approved factory, as well as a Corning Cable Systems CAH Connections SM Gold Program member, authorized to manufacture fiber optic products and assemblies that are backed by Corning Cable Systems' extended warranty. Cables Unlimited outsources the assembly of a portion of its proprietary OptiFlex cable to a third party manufacturer. The final assembly and termination of the OptiFlex cable is completed by Cables Unlimited at its Yaphank, New York facilities.

 

Comnet Telecom manufactures, assembles and tests its cabling products at its facilities in East Brunswick, New Jersey. Comnet Telecom is a Corning Cable Systems CAH Connections SM Gold Program approved fiber optic member and a Telcordia GR-326 approved manufacturer also authorized to produce fiber optic products and assemblies that are backed by Corning Cable Systems' extended warranty.

 

Rel-Tech Electronics manufactures its cable assemblies, electromechanical assemblies, wiring harnesses and other products in its Milford, Connecticut, ISO approved manufacturing facility. 

 

Raw Materials

 

Connector materials are typically made of commodity metals such as copper, brass and zinc and include small applications of precious materials, including silver and gold. The RF Connector and Cable division purchases most of its connector products from contract manufacturers located in Asia and the United States. The Company believes that the raw materials used in its products are readily available and that the Company is not currently dependent on any supplier for its raw materials. The Company does not currently have any long-term purchase or supply agreements with its connector or suppliers. The Cable Assembly group obtains coaxial connectors from the RF Connector group. The Company believes there are numerous domestic and international suppliers of coaxial connectors.

 

The Cables Unlimited division, Comnet Telecom division and the Rel-Tech Electronics division purchase all of their products from manufacturers located in the United States. Fiber optic cables are available from various manufacturers located throughout the United States; however, both Cables Unlimited and Comnet Telecom purchase most of their fiber optic cables from Corning Cables Systems LLC. The Company believes that the raw materials used by Cables Unlimited and Comnet Telecom in their products are readily available and that neither division is not currently dependent on any supplier for its raw materials except where Corning Extended Warranty certification is required. Neither Cables Unlimited, nor Comnet Telecom nor Rel-Tech Electronics currently have any long-term purchase or supply agreements with their connector and cable suppliers.

 

Employees

 

As of October 31, 2017, the Company employed 195 full-time employees, of whom 43 were in accounting, administration, sales and management, 146 were in manufacturing, distribution and assembly, and 6 were engineers engaged in design, engineering and research and development. The employees were based at the Company’s offices in San Diego, California (64 employees), Yaphank, New York (35 employees), Milford, Connecticut (66 employees) and East Brunswick, New Jersey (30 employees). The Company also occasionally hires part-time employees. The Company believes that it has a good relationship with its employees. The Cables Unlimited division employs five cable installers who are currently represented by a union. Other than the foregoing installers that belong to a union, none of the Company’s other employees are unionized.

 

 5 

 

 

Research and Development

 

The Company’s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively. Research and development costs are expensed as incurred.

 

Patents, Trademarks and Licenses

 

The Company owns 14 patents (ten U. S. and four foreign) and there are two foreign patents pending approval related to CompPro Product Line that it acquired in May 2015. The CompPro Product Line utilizes a patented compression technology that offers revolutionary advantages for a water-tight connection, easier installation, and improved system reliability on braided cables. The CompPro Product Line is used by wireless network operators, installers and distributors in North America and other parts of the world. The Company also owns the “CompPro” registered trademark associated with the compression cable product line.

 

The Company uses “OptiFlex™” as a trademark for its hybrid cable wireless tower cable solution.

 

Because the Company carries thousands of separate types of connectors and other products, most of which are available in standard sizes and configuration and are also offered by the Company’s competitors, the Company does not believe that its business or competitive position is dependent on patent protection.

 

Under its agreements with Corning Cables Systems LLC, Cables Unlimited and Comnet Telecom are permitted to advertise that they are Corning Cables System CAH Connections Gold Program members.

 

Warranties and Terms

 

The Company warrants its products to be free from defects in material and workmanship for varying warranty periods, depending upon the product. Products are generally warranted to the dealer for one year, with the dealer responsible for any additional warranty it may make. The RF Connector products are warranted for the useful life of the connectors. Although the Company has not experienced any significant warranty claims to date, there can be no assurance that it will not be subjected to such claims in the future.

 

The Company usually sells to customers on 30-day terms pursuant to invoices and does not generally grant extended payment terms. Sales to most foreign customers are made on cash terms at time of shipment. Customers may delay, cancel, reduce, or return products after shipment subject to a restocking charge.

 

Under its agreements with Corning Cables Systems LLC, Cables Unlimited and Comnet Telecom are authorized to manufacture optic cable assemblies that are backed by Corning Cables Systems’ extended warranty (referred to as the “Gold Certified Warranty”).

  

Competition

 

The Company and industry analysts estimate worldwide sales of connector products of approximately $59 billion in 2017. The Company believes that the worldwide industry for connector products is highly fragmented, with no one competitor having over a 20% share of the total market. The Company and industry analysts estimate worldwide sales of cable assembly products totaled nearly $140 billion in 2016. In North America, there are an estimated 1,105 companies participating in the cable assembly business with approximately 23% of the companies serving the industrial market sector. Many of the competitors of the RF Connector and Cable Assembly division have significantly greater financial resources and broader product lines. The RF Connector and Cable Assembly division competes on the basis of product quality, product availability, price, service, delivery time and value-added support to its distributors and OEM customers. Since the Company’s strategy is to provide a broad selection of products in the areas in which it competes and to have a ready supply of those products available at all times, the Company normally carries a significant amount of inventory of its connector products.

 

Cables Unlimited competes on the basis of product quality, custom design, service, delivery time and value-added support to its customers. Since Cables Unlimited and Comnet Telecom are Corning Cables System CAH Connections Gold Program members, along with 13 companies permitted to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems’ extended warranty. Cables Unlimited and Comnet Telecom believes that being part of a limited number of Corning Cables System CAH Connections Gold Program members provides a competitive advantage in certain fiber optic markets.

 

Cables Unlimited, Comnet Telecom and Rel-Tech Electronics compete with both smaller, local cable assembly houses as well as large, national manufacturers and distributors of telecommunications equipment and products.

 

 6 

 

 

Government Regulations

 

The Company’s products are designed to meet all known existing or proposed governmental regulations. Management believes that the Company currently meets existing standards for approvals by government regulatory agencies for its principal products.

  

The Company’s products are Restriction on Hazardous Substances (“RoHS”) compliant.

 

Investor Information.

 

The Company’s principal executive office is currently located at 7610 Miramar Road, Building #6000, San Diego, California. The Company was incorporated in the State of Nevada on November 1, 1979, completed its initial public offering in March 1984 under the name Celltronics, Inc., and changed its name to RF Industries, Ltd. in November 1990. Unless the context requires otherwise, references to the “Company” in this report include RF Industries, Ltd. and its three wholly-owned subsidiaries, Cables Unlimited, Inc., Comnet Telecom Supply, Inc., and Rel-Tech Electronics, Inc.

 

The Company’s principal Internet website is located at http://www.rfindustries.com. The Company’s annual reports, quarterly reports, current reports on Form 8-K and amendments to such reports filed or furnished pursuant to section 13(a) or 15(d) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), and other information related to the Company, are available, free of charge, on that website as soon as we electronically file those documents with, or otherwise furnish them to, the Securities and Exchange Commission (“SEC”). The Company’s Internet website and the information contained therein, or connected thereto, are not and are not intended to be incorporated into this Annual Report on Form 10-K.

 

ITEM 1.ARISK FACTORS

 

Investors should carefully consider the risks described below and all other information in this Form 10-K. The risks and uncertainties described below are not the only ones facing the Company. Additional risks and uncertainties not presently known to the Company or that it currently deems immaterial may also impair the Company’s business and operations.

 

If any of the following risks actually occur, the Company’s business, financial condition or results of operations could be materially adversely affected. In such case, the trading price of the Company’s common stock could decline and investors may lose all or part of the money they paid to buy the Company’s common stock.

 

The Company Is Heavily Dependent Upon Wireless And Broadband Communications Providers.

 

The revenues and profitability of the Company are, to a significant extent, dependent upon the wireless and broadband communications industries. Accordingly, revenues and profits have decreased during the past two years as these markets have experienced an industry-wide slowdown in growth. The Company’s operations are expected in the future to continue to be heavily dependent upon the wireless and broadband industries. The Company acquired Comnet Telecom in January 2015 and Rel-Tech Electronics in June 2015 in part to reduce the Company’s dependence on the wireless and broadband customers and to provide other communications products that are not as dependent upon the wireless and broadband markets. However, because the Company anticipates that sales to the wireless and broadband markets will continue to represent a large portion of the Company’s revenues, the Company’s revenues and profits will continue to be heavily dependent on the wireless and broadband markets.

 

The Company Depends On Third-Party Contract Manufacturers For A Majority Of Its Connector Manufacturing Needs. If They Are Unable To Manufacture A Sufficient Quantity Of High-Quality Products On A Timely And Cost-Efficient Basis, The Company’s Net Revenue And Profitability Would Be Harmed And Its Reputation May Suffer.

 

Substantially all of the Company’s RF Connector and Cable Division’s connector products are manufactured by third-party contract manufacturers. The Company relies on them to procure components for RF Connectors and in certain cases to design, assemble and test its products on a timely and cost-efficient basis. If the Company’s contract manufacturers are unable to complete design work on a timely basis, the Company will experience delays in product development and its ability to compete may be harmed. In addition, because some of the Company’s manufacturers have manufacturing facilities in Taiwan and China, their ability to provide the Company with adequate supplies of high-quality products on a timely and cost-efficient basis is subject to a number of additional risks and uncertainties, including political, social and economic instability and factors that could impact the shipment of supplies. If the Company’s manufacturers are unable to provide it with adequate supplies of high-quality products on a timely and cost-efficient basis, the Company’s operations would be disrupted and its net revenue and profitability would suffer. Moreover, if the Company’s third-party contract manufacturers cannot consistently produce high-quality products that are free of defects, the Company may experience a higher rate of product returns, which would also reduce its profitability and may harm the Company’s reputation and brand.

 

The Company does not currently have any long-term supply agreements with any of its contract manufacturers, and such manufacturers could stop manufacturing products for the Company at any time. Although the Company believes that it could locate alternate contract manufacturers if any of its manufacturers terminated their business, the Company’s operations could be impacted until alternate manufacturers are found.

 

 7 

 

 

The Company’s Prior Acquisitions And Potential Additional Future Acquisitions Could Increase Operating Costs And Expose The Company To Additional Risks.

 

As part of its plan to operate businesses that are profitable and that reflect the changing market, the Company from time to time sells unprofitable divisions and purchases new businesses. During the past few years, the Company has sold its Aviel, RadioMobile and RF Neulink divisions, and has shutdown its Bioconnect division. The Company has also purchased the Cables Unlimited, Comnet Telecom, and Rel-Tech subsidiaries. While the Company believes that restructuring its operations to address changes in its principal markets will benefit the Company in the longer term, these dispositions and acquisitions have in the short term caused the Company to incur additional legal, accounting and administrative expenses, including the cost of integrating the various accounting systems of its new subsidiaries, upgrading its information systems, and the cost of managing various divisions in separate locations and states. The Company may in the future make additional acquisitions. Accordingly, the Company will be subject to numerous risks associated with the acquisition of additional businesses, including:

 

·diversion of management’s attention;

 

·the effect on the Company’s financial statements of the amortization of acquired intangible assets;

 

·the cost associated with acquisitions and the integration of acquired operations;

 

·the Company may not be able to secure capital to finance future acquisitions to the extent additional debt or equity is needed; and

 

·assumption of unknown liabilities, or other unanticipated events or circumstances.

 

Any of these risks could materially harm the Company’s business, financial condition and results of operations. There can be no assurance that any business that the Company acquires will achieve anticipated revenues or operating results.

 

The Company’s Dependence On Third-Party Manufacturers Increases The Risk That It Will Not Have An Adequate Supply Of Products Or That Its Product Costs Will Be Higher Than Expected.

 

The risks associated with the Company’s dependence upon third parties which develop and manufacture and assemble the Company’s products, include:

 

  · reduced control over delivery schedules and quality;
     
  · risks of inadequate manufacturing yields and excessive costs;
     
  · the potential lack of adequate capacity during periods of excess demand; and
     
  · potential increases in prices due to raw material and/or labor costs.

 

These risks may lead to increased costs or delay product delivery, which would harm the Company’s profitability and customer relationships.

 

An impairment in the carrying value of goodwill, tradenames and other long-lived assets could negatively affect the Company’s consolidated results of operations and net worth.

 

Goodwill and indefinite-lived intangible assets, such as trade names, are recorded at fair value at the time of acquisition and are not amortized, but are reviewed for impairment annually or more frequently if impairment indicators arise. In evaluating the potential for impairment of goodwill and trade names, we make assumptions regarding future operating performance, business trends and market and economic conditions. There are inherent uncertainties related to these factors and in applying these factors to the assessment of goodwill and trade name recoverability. Goodwill reviews are prepared using estimates of fair value based on the estimated present value of future discounted cash flows. The Company could be required to evaluate the recoverability of goodwill or tradenames prior to the annual assessment upon unexpected significant declines in operating results, the divestiture of a significant component of the Company’s business or other factors.

 

The Company has determined as of October 31, 2017 that the goodwill of Cables Unlimited, Inc., Comnet, Rel-Tech and CompPro have not been impaired.

 

However, in the fourth quarter of the fiscal year ended October 31, 2016, the Company recognized $2.6 million and $150,000 of impairment charges on goodwill and tradename, respectively, related to its Cables Unlimited, Inc. subsidiary.

 

No assurance can be given that events or circumstances will not change regarding the carrying value of goodwill of the Cables Unlimited, Comnet and Rel-Tech subsidiaries or the CompPro product line. Should the Company in the future determine that the carrying value of the goodwill associated with some or all of these assets no longer is recoverable, the Company will have to record additional impairment losses. In the event that the Company does have to record material impairment charges on either of the Cables Unlimited, Comnet and Rel-Tech subsidiaries or the CompPro product line, such future charges could materially reduce future earnings, which would negatively affect the Company’s stock price.

 

 8 

 

 

If The Manufacturers Of The Company’s Coaxial Connectors Or Other Products Discontinue The Manufacturing Processes Needed To Meet The Company’s Demands Or Fail To Upgrade Their Technologies, The Company May Face Production Delays.

 

The Company’s coaxial connector and other product requirements typically represent a small portion of the total production of the third-party manufacturers. As a result, the Company is subject to the risk that a third-party manufacturer will cease production of some of the Company’s products or fail to continue to advance the process design technologies on which the manufacturing of the Company’s products are based. Each of these events could increase the Company’s costs, harm its ability to deliver products on time, or develop new products.

 

While The Company Has In The Past Paid Dividends, No Assurance Can Be Given That The Company Will Declare Or Pay Cash Dividends In The Future.

 

During fiscal 2017, the Company made four dividends distributions to its stockholders (for a total of $0.08 per share). Dividends are declared and paid at the discretion of the Board of Directors subject to applicable laws, and depend on a number of factors, including our financial condition, results of operations, capital requirements, plans for future acquisitions, contractual restrictions, general business conditions and other factors that our Board of Directors may deem relevant. If the Company does not pay a cash dividend, the Company’s stockholders will not realize a return on their investment in the Common Stock except to the extent of any appreciation in the value of the Common Stock. 

 

The Company’s Dependence Upon Independent Distributors To Sell And Market The Company’s Products Exposes The Company To The Risk That Such Distributors May Decrease Their Sales Of The Company’s Products Or Terminate Their Relationship With The Company.

 

The Company’s sales efforts are primarily affected through independent distributors. Although the Company has entered into written agreements with most of the distributors, the agreements are nonexclusive and generally may be terminated by either party upon 30-60 days’ written notice. The Company’s distributors are not within the control of the Company, are not obligated to purchase products from the Company, and may also sell other lines of products. There can be no assurance that these distributors will continue their current relationships with the Company or that they will not give higher priority to the sale of other products, which could include products of competitors. A reduction in sales efforts or discontinuance of sales of the Company’s products by its distributors would lead to reduced sales and could materially adversely affect the Company’s financial condition, results of operations and business. Selling through indirect channels such as distributors may limit the Company’s contact with its ultimate customers and the Company’s ability to assure customer satisfaction.

 

A Portion Of The Company’s Sales Is Dependent Upon A Few Principal Customers, The Loss Of Whom Could Materially Negatively Affect The Company’s Total Sales.

 

Two customers accounted for approximately 20% and 11% of the Company’s net sales for the fiscal year ended October 31, 2017, and one customer accounted for approximately 15% of the Company’s net sales for the fiscal year ended October 31, 2016. Although these customers have been on-going major customers of the Company continuously in the past, the written agreements with these customers do not have any minimum purchase obligations and the customers could stop buying the Company’s products at any time and for any reason. A reduction, delay or cancellation of orders from these customers or the loss of these customers could significantly reduce the Company’s future revenues and profits. The Company cannot provide assurance that this customer or any of its current customers will continue to place orders, that orders by existing customers will continue at current or historical levels or that the Company will be able to obtain orders from new customers.

 

Difficult Conditions In The Global Economy May Adversely Affected the Company’s Business And Results Of Operations.

 

A prolonged economic downturn, both in the U.S. and worldwide, could lead to lower sales or reduced sales growth, reduced prices, lower gross margins, and increased bad debt risks, all of which could adversely affect the Company’s results of operations, financial condition and cash flows. Slowing economic activity, particularly in the telecommunication and data communication and wireless communications industries that represent the Company’s largest target market, may adversely impact the demand for the Company’s products. If the current economic condition in the U.S. deteriorates, the Company’s results could be adversely affected as demand for wireless products lessens. There could also be a number of other adverse follow-on effects on the Company’s business from a deterioration of economic conditions or from a credit crisis, including insolvency of certain key distributors, key suppliers, contract manufacturers and customers.

 

Because The Markets In Which The Company Competes Are Highly Competitive, A Failure To Effectively Compete Could Result In An Immediate And Substantial Loss Of Market Share.

 

The markets in which the Company operates are highly competitive and the Company expects that competition will increase in these markets. In particular, the wireless and telecommunications markets in which most of the Company’s products are sold are intensely competitive. A failure to effectively compete in this market could result in an immediate and substantial loss of revenues and market share. Because most of the Company’s sales are derived from products that are not proprietary or that can be used to distinguish the Company from its competitors, the Company’s ability to compete successfully in these markets depends on a number of factors, including:

 

  · product quality;
  · reliability;
  · customer support;

 

 9 

 

 

  · time-to-market;
  · price;
  · market acceptance of competitors’ products; and
  · general economic conditions.

 

The Company’s revenues may suffer if the Company is not able to effectively satisfy its customers in each of the foregoing ways. In addition, the Company’s competitors or customers may offer enhancements to its existing products or offer new products based on new technologies, industry standards or customer requirements that have the potential to replace or provide lower-cost or higher performance alternatives to the Company’s products. The introduction of enhancements or new products by the Company’s competitors could render its existing and future products obsolete or unmarketable.

 

Many of the Company’s competitors have significantly greater financial and other resources. In certain circumstances, the Company’s customers or potential customers have internal manufacturing capabilities with which the Company may compete.

 

If The Industries Into Which The Company Sells Its Products Experience Recession Or Other Cyclical Effects Impacting The Budgets Of Its Customers, The Company’s Operating Results Could Be Negatively Impacted.

 

The primary customers for the Company’s connector and cable products are in the wireless communications industries. Any significant downturn in the Company’s customers’ markets, in particular, or in general economic conditions which result in the cut back of budgets would likely result in a reduction in demand for the Company’s products and services and could harm the Company’s business. Historically, the communications industry has been cyclical, affected by both economic conditions and industry-specific cycles. Depressed general economic conditions and cyclical downturns in the communications industry have each had an adverse effect on sales of communications equipment, OEMs and their suppliers, including the Company. No assurance can be given that the wireless communications industry will not experience a material downturn in the near future. Any cyclical downturn in the communications industry could have a material adverse effect on the Company.

 

Because The Company Sells Its Products To Foreign Customers, The Company Is Exposed To All Of The Risks Associated With International Sales, Including Foreign Currency Exposure.

 

Sales to customers located outside the United States, either directly or through U.S. and foreign distributors, accounted for approximately 2% and 3% of the net sales of the Company during the years ended October 31, 2017 and 2016, respectively. International revenues are subject to a number of risks, including:

 

  · longer accounts receivable payment cycles;
  · difficulty in enforcing agreements and in collecting accounts receivable;
  · tariffs and other restrictions on foreign trade;
  · economic and political instability; and the
  · burdens of complying with a wide variety of foreign laws.

 

The Company’s foreign sales are also affected by general economic conditions in its international markets. A prolonged economic downturn in its foreign markets could have a material adverse effect on the Company’s business. There can be no assurance that the factors described above will not have an adverse material effect on the Company’s future international revenues and, consequently, on the financial condition, results of operations and business of the Company.

 

Since sales made to foreign customers or foreign distributors have historically been in U.S. dollars, the Company has not been exposed to the risks of foreign currency fluctuations. However, if the Company in the future is required to accept sales denominated in the currencies of the countries where sales are made, the Company will thereafter also be exposed to currency fluctuation risks.

 

Changes Of Key Personnel Could Adversely Affect The Company’s Operations.

 

The Company’s success is dependent to a significant extent on the service of the Company’s senior executives. On July 17, 2017, the Company hired Robert D. Dawson as President and Chief Executive Officer. Howard Hill, the Company’s interim President and Chief Executive Officer, remained with the Company as a member of its Board of Director. The Company believes that Mr. Dawson’s experience as well as his knowledge of the wireless market is highly valuable to the Company. In addition, the Company’s operations are dependent upon the continued services of Mark Turfler, its Chief Financial Officer, and the presidents of the Company’s four divisions. The loss of the services of these officers could materially adversely affect the Company’s business, operating results, and financial condition. The Company has an employment agreement in place for Mr. Dawson and no other officers.

 

The Company Has Few Patent Rights In The Technology Employed In Its Products, Which May Limit the Company’s Ability To Compete.

 

Other than the patents that the Company owns related to its CompPro proprietary product line, the Company does not hold any other United States or foreign patents, and does not have any patents pending. The Company does not seek to protect its rights in the technology that it develops or that the Company’s third-party contract manufacturers develop by means of the patent laws, although it does protect some aspects of its proprietary products and technologies by means of copyright and trade secret laws. Accordingly, competitors can and do sell many of the same products as the Company, and the Company cannot prevent or restrict such competition.

 

 10 

 

 

Volatility of Trading Prices Of The Company’s Stock Could Result In A Loss On An Investment In The Company’s Stock.

 

The market price of the Company’s common stock has varied greatly, and the trading volume of the Company’s common stock has fluctuated greatly as well. These fluctuations often occur independently of the Company’s performance or any announcements by the Company. Factors that may result in such fluctuations include:

 

·any shortfall in revenues or net income from revenues or net income expected by securities analysts, or a net loss in the Company’s quarterly or annual operations;

 

·fluctuations in the Company’s financial results or the results of other connector and communications-related companies, including those of the Company’s direct competitors;

 

·changes in analysts’ estimates of the Company’s financial performance, the financial performance of the Company’s competitors, or the financial performance of connector and communications-related public companies in general;

 

·general conditions in the connector and communications industries;

  

·changes in the Company’s revenue growth rates or the growth rates of the Company’s competitors;

 

·sales of large blocks of the Company’s common stock; and

 

·conditions in the financial markets in general.

 

In addition, the stock market may, from time to time, experience extreme price and volume fluctuations, which may be unrelated to the operating performance of any specific company. Accordingly, the market prices of the Company’s common stock may be expected to experience significant fluctuations in the future.

 

Failure to maintain an effective system of internal control over financial reporting or to remediate weaknesses could materially harm the Company’s revenues, erode stockholder confidence in the Company's ability to pursue business and report its financial results/condition, and negatively affect the trading price of the Company’s common stock.

 

As a public reporting company, the Company is required to establish and maintain effective internal control over financial reporting. Failure to establish such internal control, or any failure of such internal control once established, could adversely impact the Company’s public disclosures regarding its business, financial condition or results of operations. Any failure of our internal control over financial reporting could also prevent the Company from maintaining accurate accounting records and discovering accounting errors and financial frauds.

 

Rules adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 require annual assessment of our internal control over financial reporting. The standards that must be met for management to assess the internal control over financial reporting as effective are complex, and require significant documentation, testing and possible remediation to meet the detailed standards. Management’s assessment that there are weaknesses in the Company’s internal control over financial reporting may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in the internal controls over financial reporting (including those weaknesses identified in periodic reports), or disclosure of management’s assessment of the internal controls over financial reporting may have an adverse impact on the price of the Company’s common stock.

 

As disclosed in Form 10-K for the year ended October 31, 2016, we identified a material weakness in our internal controls specifically in connection with the untimely review of the impairment analysis for goodwill prepared by third party subject matter experts. We determined that the Company did not have adequate design or operation of internal controls to ensure the timely review of its accounting for certain complex estimates. While we believe that we have remediated the foregoing material weakness and that our internal controls were effective as of October 31, 2017, no assurance can be given that there will not be other failures in our internal controls.

 

 11 

 

 

A Cyber Incident Could Result In Information Theft, Data Corruption, Operational Disruption, And/ Or Financial Loss.

 

Businesses have become increasingly dependent on digital technologies to conduct day-to-day operations. At the same time, cyber incidents, including deliberate attacks or unintentional events, have increased. A cyber attack could include gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption or result in denial of service on websites. We depend on digital technology, including information systems and related infrastructure, to process and record financial and operating data, and communicate with our employees and business partners. Our technologies, systems, networks, and those of our business partners may become the target of cyber attacks or information security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of proprietary and other information, or other disruption of our business operations. Although to date we have not experienced any losses relating to cyber attacks, there can be no assurance that we will not suffer such losses in the future. As cyber threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities.

 

ITEM 1B.UNRESOLVED STAFF COMMENTS

 

None.

 

ITEM 2.DESCRIPTION OF PROPERTY

 

The Company currently leases its corporate headquarters and RF connector and cable assembly manufacturing facilities at 7610 Miramar Road, San Diego, California. At that location, the Company leases three buildings, that house the Company’s corporate administration, sales and marketing, and engineering departments. The buildings also are used for production and warehousing by the Company’s RF Connector and Cable Assembly and Comnet Telecom divisions. On June 5, 2017, the Company entered into a fifth amendment to its lease for its facility in San Diego, California. As a result, the Company now leases a total of approximately 21,908 square feet of office, warehouse and manufacturing space at its San Diego location. The term of the lease expires on July 31, 2022, and the rental payments under the lease currently are $22,721 per month. The San Diego lease also requires the payment of the Company’s pro rata share of real estate taxes and insurance, maintenance and other operating expenses related to the facilities.

 

(i)On June 9, 2017, the Cables Unlimited division entered into an amendment to its lease with K & K Unlimited, as landlord, under which Cables Unlimited leases its 12,000 square foot manufacturing facility in Yaphank, New York, to extend the term of the lease to June 30, 2018. Cables Unlimited’s monthly rent expense under the amended lease remains at $13,000 per month, plus payments of all utilities, janitorial expenses, routine maintenance costs and costs of insurance for Cables Unlimited’s business operations and equipment. The landlord is a company controlled by Darren Clark, the former owner and current President of Cables Unlimited.

 

(ii)On June 25, 2017, the Comnet Telecom division entered into an amendment to its lease for approximately 15,000 square feet in two suites located in East Brunswick, New Jersey. Comnet’s current monthly rent expense under the leases is $8,542 per month for these facilities. The amended lease expires in September 2022.

 

(iii)On July 25, 2017, the Rel-Tech Electronic division entered into a lease for approximately 13,750 square feet located in Milford, Connecticut. Rel-Tech’s current net monthly rent expense under the lease is $8,707 per month for these facilities. The new lease expires in August 2019.

 

The aggregate monthly rental for all of the Company’s facilities currently is approximately $53,000 per month, plus utilities, maintenance and insurance.

 

ITEM 3.LEGAL PROCEEDINGS

 

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. As of the date of this report, we are not subject to any proceeding that is not in the ordinary course of business or that is material to the financial condition of our business.

 

ITEM 4.MINE SAFETY DISCLOSURES

 

Not applicable.

 

PART II

 

ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 

The Company’s Common Stock is listed and trades on the NASDAQ Global Market under the symbol “RFIL.”

 

The price range per share of common stock presented below represents the highest and lowest intraday sales prices for the Company’s common stock on the NASDAQ during each quarter of the two most recent years.

 

 12 

 

 

Quarter  High   Low 
         
Fiscal 2017          
           
November 1, 2016 - January 31, 2017  $2.10   $1.40 
February 1, 2017 - April 30, 2017   1.70    1.40 
May 1, 2017 - July 31, 2017   2.00    1.40 
August 1, 2017 - October 31, 2017   2.85    1.75 
           
Fiscal 2016          
           
November 1, 2015 - January 31, 2016  $4.55   $3.90 
February 1, 2016 - April 30, 2016   4.35    2.09 
May 1, 2016 - July 31, 2016   2.54    1.99 
August 1, 2016 - October 31, 2016   2.45    1.70 

 

Stockholder. As of October 31, 2017, there were 315 holders of the Company’s Common Stock according to the records of the Company’s transfer agent, Continental Stock Transfer & Trust Company, New York, New York, not including holders who hold their stock in “street name.”

 

Dividends. The Company paid four quarterly dividends of $0.02 per share during the year ended October 31, 2017 for a total of $707,000. The Company paid quarterly dividends of $0.02, $0.02, $0.02 and $0.07 per share during the three months ended October 31, 2016, July 31, 2016, April 30, 2016 and January 31, 2016, respectively, for a total of $1.1 million. Dividends are declared and paid from time to time at the discretion of the Board of Directors subject to applicable laws, and depend on a number of factors, including our financial condition, results of operations, capital requirements, plans for future acquisitions, contractual restrictions, general business conditions and other factors that our Board of Directors may deem relevant.

 

Repurchase of Securities. The Company did not repurchase any securities during the fiscal year October 31, 2017.

 

Recent Sales of Unregistered Securities. There were no previously unreported sales of equity securities by the Company that were not registered under the Securities Act during fiscal 2017.

 

EQUITY COMPENSATION PLAN INFORMATION

 

The following table provides information as of October 31, 2017 with respect to the shares of Company common stock that may be issued under the Company’s existing equity compensation plans.

 

   A   B   C 
           Number of Securities 
           Remaining Available for 
           Future Issuance Under 
           Equity Compensation 
   Number of Securities to   Weighted Average   Plans (Excluding 
   be Issued Upon Exercise   Exercise Price of   Securities Reflected in 
Plan Category  of Outstanding Options   Outstanding Options ($)   Column A) 
Equity Compensation Plans Approved by Stockholders (1)   1,009,771   $3.50    1,726,138 
                
Equity Compensation Plans Not Approved by Stockholders (2)   150,000   $1.09    - 
Total   1,159,771   $3.19    1,726,138 

 

(1)Consists of options granted under the R.F. Industries, Ltd. 2010 Stock Option Plan..

 

(2)Consists of options granted to five officers and/or key employees of the Company under employment agreements entered into by the Company with each of these officers and employees.

 

ITEM 6.SELECTED FINANCIAL DATA

 

Not applicable to a “smaller reporting company” as defined in Item 10(f)(1) of SEC Regulation S-K.

 

 13 

 

 

ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

 

The consolidated financial statements and related disclosures have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these consolidated financial statements requires the Company to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent assets and liabilities. The Company evaluates its estimates, including those related to bad debts, inventory reserves and contingencies on an ongoing basis. The Company bases its estimates on historical experience and on various other assumptions that are believed to be appropriate under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

 

Inventories

 

Inventories are stated at the lower of cost or market, with cost determined using the weighted average cost method of accounting. Certain items in inventory may be considered obsolete or excess and, as such, the Company periodically reviews its inventories for excess and slow moving items and make provisions as necessary to properly reflect inventory value. Because inventories have, during the past couple years, represented up to one-fourth of our total assets, any reduction in the value of our inventories would require the Company to take write-offs that would affect the net worth and future earnings.

 

Allowance for Doubtful Accounts

 

The Company records its allowance for doubtful accounts based upon its assessment of various factors. The Company considers historical experience, the age of the accounts receivable balance, credit quality of the Company’s customers, current economic conditions and other factors that may affect a customer’s ability to pay.

 

Long-Lived Assets Including Goodwill

 

The Company assesses property, plant and equipment and intangible assets, which are considered definite-lived assets, for impairment. Definite-lived assets are reviewed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value.

 

The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment.

 

The Company tests its goodwill and trademarks and indefinite-lived assets for impairment at least annually or more frequently if events or changes in circumstances indicate these assets may be impaired. These events or circumstances require significant judgment and could include a significant change in the business climate, legal factors, operating performance indicators, competition and sale or disposition of all or a portion of a division. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital.

 

Earn-out Liability

 

The purchase agreement for the Rel-Tech acquisition provides for earn-out payments of up to $800,000, payable through May 31, 2018. The fair value of the obligation under the earn-out purchase price arrangement for Rel-Tech was $236,000 as of October 31, 2017. The initial earn-out liability was valued at its fair value using the Monte Carlo simulation and is included as a component of the total purchase price. The earn-out was and will continue to be revalued quarterly using a present value approach and any resulting increase or decrease will be recorded into selling and general expenses. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. Significant judgment is employed in determining the appropriateness of the assumptions used in calculating the fair value of the earn-out as of the acquisition date. Accordingly, significant variances between actual and forecasted results or changes in the assumptions can materially impact the amount of contingent consideration expense we record in future periods.

 

Income Taxes

 

The Company records a tax provision for the anticipated tax consequences of the reported results of operations. Income taxes are accounted for under the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates as of the date of the financial statements that apply to taxable income in effect for the years in which those tax assets are expected to be realized or settled. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

 

 14 

 

 

If a deduction reported on a tax return for an equity-based incentive award exceeds the cumulative compensation cost for those instruments recognized for financial reporting purposes, any resulting realized tax benefit that exceeds the previously calculated deferred tax asset for those instruments is considered an excess tax benefit, and is recognized as additional paid-in capital. If the tax deduction is less than the cumulative book compensation cost, the tax effect of the resulting difference is charged first to additional paid-in capital, to the extent of the available pool of windfall tax benefits, with any remainder recognized in income tax expense.

 

The calculation of the tax provision involves significant judgment in estimating the impact of uncertainties in the application of GAAP and complex tax laws. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on the Company’s financial condition and operating results.

 

Stock-based Compensation

 

The Company uses the Black-Scholes model to value the stock option grants. This valuation is affected by the Company’s stock price as well as assumptions regarding a number of inputs which involve significant judgments and estimates. These inputs include the expected term of employee stock options, the expected volatility of the stock price, the risk-free interest rate and expected dividends.

 

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

 

For recently issued accounting pronouncements that may affect us, see Note 1 of Notes to Consolidated Financial Statements.

 

OVERVIEW

 

During the periods covered by this Annual Report, the Company marketed a variety of connector products, including connectors and cables, standard and custom cable assemblies, wiring harnesses, fiber optic cable products, and data center products to numerous industries for use in thousands of products. The range of products that the Company sold has changed in the periods covered by the attached financial statements. During the past two years, the Company sold its Aviel Electronics division (a provider of custom RF connectors primarily for aerospace and military customers) and shut down its Bioconnect division, which manufactured and sold medical cabling and interconnect products. During the past few years, RF Industries also purchased Comnet Telecom (a provider of fiber optic and other cabling technologies, custom patch cord assemblies, and other data center products) effective November 2014, and Rel-Tech (a provider of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers) in June 2015. The acquisitions of Comnet and Rel-Tech have diversified the Company’s product line and customer base, and have increased the Company’s presence on the East Coast. As well, Comnet and Rel-Tech have significantly contributed to the Company’s revenues and profitability. During 2015, the Company also purchased a new patented connector product line and technology (the CompPro line).

 

The Company aggregates operating divisions into operating segments which have similar economic characteristics and are similar in the majority of the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; and (5) if applicable, the nature of the regulatory environment. The Company has two segments - the “RF Connector and Cable Assembly” segment and the “Custom Cabling Manufacturing and Assembly” segment-based upon this evaluation.

 

Since the sale of Aviel Electronics in December 2015, the RF Connector and Cable Assembly segment has been comprised of one division, while the Custom Cabling Manufacturing and Assembly segment has been comprised of three divisions. The four divisions that met the quantitative thresholds for segment reporting are the RF Connector and Cable Assembly division and the Cables Unlimited, Comnet and Rel-Tech subsidiaries. Each of the other divisions aggregated into these segments had similar products that were marketed to their respective customer base and production and product development processes that are similar in nature. The specific customers are different for each division; however, there was some overlapping of product sales to them. The methods used to distribute products are similar within each division aggregated.

 

For the year ended October 31, 2017, most of the Company’s revenues were generated from the Custom Cabling Manufacturing and Assembly segment from the sale of fiber optics cable, copper cabling, custom patch cord assemblies, wiring harnesses, transceivers/converters and other data center equipment (which accounted for 63% of the Company’s total sales for the fiscal year ended October 31, 2017). Revenues from the RF Connector and Cable Assembly segment were generated from the sales of RF connector products and connector cable assemblies and accounted for 37% of the Company’s total sales for the fiscal year ended October 31, 2017.

 

Income from discontinued operations, net of tax, during the fiscal 2017 year was $116,000 compared to a loss of $(58,000) in the prior year. During March 2016, the Company announced the shutdown of its Bioconnect division as part of the Company’s ongoing plan to close or dispose of underperforming divisions that are not part of the Company’s core operations. For the 2017 and 2016 fiscal years, the Company recognized pretax income of $10,000 and $90,000, respectively, from the Bioconnect division. Included in the loss for the fiscal 2016 year, the Company recognized a $148,000 pretax write-down on Bioconnect division’s inventory.

 

For the fiscal 2017 year, the Company realized income from operations of $400,000, and net income of $382,000, compared to an operating loss from operations of $4.7 million and net loss of $4.1 million in the prior fiscal year period. The losses in the fiscal 2016 year were attributable primarily to a non-cash impairment charge of $2.8 million related to the impairment of intangible assets, a reduction in the Company’s gross margins, and to increased selling and general expenses. In part to address these losses, the Company took steps to reduce its operating expenses, including the termination of certain officers and other personnel, and initiated a realignment of its manufacturing and marketing operations.

 

 15 

 

Financial Condition

 

The following table presents certain key measures of financial condition as of October 31, 2017 and 2016 (in thousands, except percentages):

 

   2017   2016 
   Amount   % Total Assets   Amount   % Total Assets 
                 
Cash and cash equivalents  $6,039    24.1%  $5,258    20.4%
Current assets   16,793    67.0%   16,793    65.0%
Current liabilities   3,598    14.4%   3,908    15.1%
Working capital   13,195    52.7%   12,885    49.9%
Property and equipment, net   711    2.8%   828    3.2%
Total assets   25,060    100.0%   25,837    100.0%
Stockholders' equity   21,343    85.2%   21,392    82.8%

 

Liquidity and Capital Resources

 

Management believes that its existing current assets and the amount of cash it anticipates it will generate from current operations will be sufficient to fund the anticipated liquidity and capital resource needs of the Company for at least twelve months from the date of this filing. Management believes that its existing assets and the cash it expects to generate from operations, including its current backlog of unfulfilled orders, will be sufficient during the current fiscal year based on the following:

 

·As of October 31, 2017, the Company had cash and cash equivalents equal to $6.0 million.

 

·As of October 31, 2017, the Company had $16.8 million in current assets and $3.6 million in current liabilities.

 

·As of October 31, 2017, the Company had no outstanding indebtedness for borrowed funds.

 

·

Subsequent to the year ended October 31, 2017, the Company has driven increased net sales across all divisions which has led to a significant increase in its backlog. As a result, the Company expects double-digit growth in net sales for the quarter ending January 31, 2018 compared to the same period last year.

 

As of October 31, 2017, the Company had a total of $6.0 million of cash and cash equivalents compared to a total of $5.3 million of cash and cash equivalents as of October 31, 2016. As of October 31, 2017, the Company had working capital of $13.2 million and a current ratio of approximately 4.7:1.

 

The Company generated cash of $0.8 million during the year ended October 31, 2017 due largely to $1.6 million of cash generated from operations. The increase in cash from operations was primarily due to net income of $0.4 million, income tax refunds of $0.7 million, increased collections of accounts receivables ($0.2 million), noncash charges of $0.9 million for depreciation and amortization related to the acquisitions of Comnet, Rel-Tech and CompPro, and $0.2 million of stock-based compensation expense. The increase in cash was partially offset by an increase in the payment of accrued expenses and long-term liabilities, which included the payment of $0.6 million to the Presidents of the Comnet and Rel-Tech divisions as part of the purchase price of those divisions. The Company no longer is obligated to make any further payments with respect to its acquisition of Comnet. The Company’s obligation to make additional payments with respect to the acquisition of Rel-Tech expires in May 2018. The fair value of the obligation under the earn-out purchase price arrangement for Rel-Tech was $236,000 as of October 31, 2017.

 

The Company does not anticipate needing material additional capital equipment in the next twelve months. In the past, the Company has financed some of its equipment and furnishings requirements through capital leases. No additional capital equipment purchases have been currently identified that would require significant additional leasing or capital expenditures during the next twelve months. Management also believes that based on the Company’s current financial condition, its current backlog of unfulfilled orders and its anticipated future operations, the Company would be able to finance its expansion, if necessary.

 

As part of its announced business plan, the Company may from time to time acquire other companies or product lines in the future in order to diversify its product and customer base. Any future acquisitions may require the Company to make cash payments, which may reduce the Company’s future liquidity and capital resources.

 

During the year ended October 31, 2017, the Company paid a total of $0.7 million ($0.08 per common share) of dividends to its stockholders.

 

 16 

 

 

Results of Operations

 

The following summarizes the key components of the results of operations for the fiscal years ended October 31, 2017 and 2016 (in thousands, except percentages).

 

   2017   2016 
       % of Net       % of Net 
   Amount   Sales   Amount   Sales 
                 
Net sales  $30,964    100%  $30,241    100%
Cost of sales   22,242    72%   21,778    72%
Gross profit   8,722    28%   8,463    28%
Engineering expenses   845    3%   747    2%
Goodwill and other intangible asset impairment   -    0%   2,844    9%
Selling and general expenses   7,506    24%   9,560    32%
Operating income (loss)   371    1%   (4,688)   -15%
Other income   29    0%   5    0%
Income (loss) from continuing operations before provision (benefit) for income taxes   400    1%   (4,683)   -15%
Provision (benefit) for income taxes   134    0%   (652)   -2%
Income (loss) from continuing operations   266    1%   (4,031)   -13%
Income (loss) from discontinued operations, net of tax   116    0%   (58)   0%
Consolidated net income (loss)   382    1%   (4,089)   -13%

 

Net sales of $31.0 million for the year ended October 31, 2017 (the “fiscal 2017 year”) increased by $0.8 million or 2% when compared to net sales of $30.2 million for the year ended October 31, 2016 (the “fiscal 2016 year”). Net sales for the fiscal 2017 year at the RF Connector and Cable Assembly segment increased by $2.2 million, or 23%, to $11.5 million as compared to $9.3 million for the fiscal 2016 year. The Company’s Custom Cabling Manufacturing and Assembly segment generated $19.5 million of net sales for the fiscal 2017 year, a decrease of $1.4 million or 7% when compared to $20.9 million for the fiscal 2016 year. The decrease in net sales at this segment is primarily attributable to the demand for the products offered in this segment during the first half of fiscal 2017. The demand for these increased in the second half of the fiscal 2017 year, resulting in sales increase in this segment of $1.3 million or 14% over first half sales of $9.1 million. The momentum built in the second half of the year in this segment has continued since the end of the fiscal 2017 year, resulting in an increase in the Company’s unfulfilled orders for telecommunications products.

 

The Company’s gross profit as a percentage of sales was 28% in both 2017 and 2016 fiscal years. Gross margins at the Company’s RF Connector and Cable Assembly segment increased; the increase, however, was offset by a lower margins at the Company’s Custom Cabling Manufacturing and Assembly segment due primarily to certain fixed manufacturing costs spread over a lower revenue base as sales in this segment decreased.

 

Engineering expenses for the fiscal 2017 year increased as compared to the fiscal 2016 year due to increased salary expense related to engineering activities. Engineering expenses represent costs incurred in the development of new products.

 

Selling and general expenses decreased by $1.9 million, or 21%, during the fiscal 2017 year to $7.5 million from $9.6 million in the prior period due to (i) cost cutting measures and (ii) one-time expenses that increased the Company’s selling and general expenses in the fiscal 2016 year. The decrease in selling and general expenses in 2017 was primarily due to the impact of the Company’s cost cutting measures that were implemented during the latter part of the 2016 fiscal year. In addition, from October 2016 to July 2017, the Company’s interim President and Chief Executive Officer agreed to serve for no salary. Selling and general expenses in 2016 fiscal year included one-time expenses that were not incurred in 2017, including $256,000 of professional fees and expenses in connection with the business combination transaction that was abandoned, $171,000 of expenses incurred in connection with the implementation of a new enterprise resource planning (ERP) system that now integrates all of the Company’s operations on the East Coast and in California, and the legal, accounting and other expenses related to the disposition of the Aviel division and the closure of the Bioconnect division.

 

In connection with the fiscal year ended October 31, 2016, the Company quantitatively evaluated the goodwill and intangibles of Cables Unlimited and determined that the carrying value of Cables Unlimited on the Company’s financial statements exceeded its fair market value. As a result, an impairment to Cables Unlimited's goodwill and tradename was determined and the Company recorded a non-cash impairment charge to goodwill and tradename of $2.6 million and $150,000, respectively, for the 2016 fiscal year. No impairment charges were incurred in the 2017 fiscal year.

 

 17 

 

 

The provision (benefit) for income taxes from continuing operations was $134,000 or 34% and $(652,000) or 14% of income (loss) before income taxes for fiscal 2017 and 2016, respectively. The difference in the effective tax rates in each fiscal year is primarily attributable to the recognition of research and development credits, changes in earn-outs, goodwill impairment and other items. Deductions related to the exercise and disposition of equity-based incentive awards during the periods presented are, in general, available to offset taxable income on the Company’s consolidated tax returns. Accordingly, the excess tax benefit related to the exercise and disposition of equity-based incentive awards for the periods presented, was credited to additional paid-in capital, not the provision (benefit) for income taxes. For the fiscal year 2017 and 2016, the Company incurred approximately $6,000 and $154,000, respectively, of windfalls from the exercise and disposition of equity-based incentive awards, of which $6,000 and $154,000 was recorded against its additional paid-in capital.

 

Income from discontinued operations, net of tax, during the fiscal 2017 year was $116,000 compared to a loss of $(58,000) in the prior year. During March 2016, the Company announced the shutdown of its Bioconnect division. For the fiscal 2017 and 2016 years, the Company recognized pretax income of $10,000 and $90,000, respectively, from the Bioconnect division. In the fiscal 2016 year, the Company recognized a $148,000 pretax write-down on Bioconnect division’s inventory. In 2013 the Company sold its RadioMobile division, in exchange for which it received a three-year commitment to receive royalty payments from the operations of RadioMobile. Accordingly, the results of the RadioMobile division have been included as discontinued operations in the attached financial statements. The Company recognized royalty income in fiscal 2016 and 2017 of $174,000 and $57,000, respectively, from the sale of RadioMobile. The three-year period for earning royalties from RadioMobile has now expired.

 

For the fiscal 2017 year, the Company incurred operating income of $400,000 and net income of $382,000, compared to an operating loss of $4.7 million and net loss of $4.1 million in the prior fiscal year period. The losses in the fiscal 2016 year are attributable primarily to an impairment charge of $2.8 million, a reduction in the Company’s gross margins and to increased selling and general expenses.

 

ITEM 7A.QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not applicable to a “smaller reporting company” as defined in Item 10(f)(1) of SEC Regulation S-K.

 

ITEM 8.STATEMENTS AND SUPPLEMENTARY DATA

 

The following Financial Statements of the Company with related Notes and Report of Independent Registered Public Accounting Firm are attached hereto as pages F-1 to F-19 and filed as part of this Annual Report:

 

·Report of CohnReznick LLP, Independent Registered Public Accounting Firm

 

·Consolidated Balance Sheets as of October 31, 2017 and 2016

 

·Consolidated Statements of Operations for the years ended October 31, 2017 and 2016

 

·Consolidated Statements of Stockholders’ Equity for the years ended October 31, 2017 and 2016

 

·Consolidated Statements of Cash Flows for the years ended October 31, 2017 and 2016

 

·Notes to Consolidated Financial Statements

 

ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 

None

 

ITEM 9A.CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

The Company maintains disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) that are designed to assure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

 

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide reasonable assurance only of achieving the desired control objectives, and management necessarily is required to apply its judgment in weighting the costs and benefits of possible new or different controls and procedures. Limitations are inherent in all control systems, so no evaluation of controls can provide absolute assurance that all control issues and any fraud have been detected.

 

As required by Exchange Act Rule 13a-15(b), as of the end of the period covered by this report, management, under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures. Based on this evaluation, management concluded that the Company’s disclosure controls and procedures are effective at a reasonable assurance level as of October 31, 2017.

 

 18 

 

 

Management’s Report on Internal Control over Financial Reporting

 

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, and for performing an assessment of the effectiveness of internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

 

The Company’s system of internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that could have a material effect on the financial statements.

 

Under the supervision and with the participation of the Company’s management, including our Chief Executive Officer and our Chief Financial Officer, the Company conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in “Internal Control-Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the above evaluation, the Company’s management has concluded that the Company’s internal controls over financial reporting was effective as of October 31, 2017.

 

This annual report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s independent registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.

 

Changes in Internal Controls

 

As disclosed in Form 10-K for the year ended October 31, 2016, we identified a material weakness in our internal controls specifically in connection with the untimely review of the impairment analysis for goodwill prepared by third party subject matter experts. We determined that the Company did not have adequate design or operation of internal controls to ensure the timely review of its accounting for certain complex estimates.

 

The Company is committed to maintaining a strong internal control environment. To address and remediate the material weakness in internal control over financial reporting described above, the Company has implemented additional procedures to more timely review complex accounting estimates that are provided by third-party subject matter experts. We believe the remediation has operated for a sufficient period of time, starting the first fiscal quarter of fiscal 2017. Further, through testing, we believe that these controls that have been implemented to remediate the material weakness are currently operating effectively for the fiscal year ended October 31, 2017.

 

We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, and to maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes. Other than as described above, there were no changes in the Company’s internal control over financial reporting during the most recent fiscal quarter ended October 31, 2017 that materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

Inherent Limitations of Internal Controls

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

PART III

 

ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 

Set forth below is information regarding the Company’s directors, including information furnished by them as to their principal occupations for the last five years, and their ages as of October 31, 2017. Other than Howard Hill, our former Chief Executive Officer, all of the Directors are “independent directors” as defined by the listing standards of the NASDAQ Stock Market, and the Board of Directors has determined that such independent directors have no relationship with the Company that would interfere with the exercise of their independent judgment in carrying out the responsibilities of a director.

 

 19 

 

 

Name   Age   Director Since
Joseph Benoit   63   2013
Marvin H. Fink   81   2001
Howard F. Hill   77   1979
William Reynolds   82   2005
Gerald Garland   67   2017

 

Joseph Benoit was appointed to the Board of Directors on April 8, 2013. Mr. Benoit retired from Union Bank in June 2012 after serving in various management and leadership roles for over 20 years. Managing over 100 Union Bank branch offices in Southern California and being the head of Business Banking were among his responsibilities. As an Executive Vice President, he also served as Union Bank’s integration manager for FDIC assisted acquisitions. Mr. Benoit has a B.S. in Business Administration from San Diego State University and an MBA from National University. He is also a graduate of Pacific Coast Banking School and serves as a director on various non-profit boards.

 

Marvin H. Fink is a retired executive. Mr. Fink most recently served as the Chief Executive Officer, President and Chairman of the Board of Recom Managed Systems, Inc. from October 2002 to March 2005. Prior thereto, Mr. Fink was President of Teledyne’s Electronics Group. Mr. Fink was employed at Teledyne for 39 years. He holds a B.E.E. degree from the City College of New York, an M.S.E.E. degree from the University of Southern California and a J.D. degree from the University of San Fernando Valley. He is a member of the California Bar (inactive).

 

Howard F. Hill, a founder of the Company in 1979, served as the Company’s Chief Executive Officer until January 22, 2015. Effective January 22, 2015, Mr. Hill stepped down as the Chief Executive Officer and agreed to serve as the Company’s Chief Operating Officer. Effective April 6, 2015, Mr. Hill announced that he was taking an indefinite medical leave of absence and resigned as the Company’s Chief Operating Officer. On April 7, 2016, Mr. Hill retired as an employee of the Company, but continued to serve on the Company’s Board of Directors. On October 31, 2016, Mr. Hill assumed the position as the unpaid, interim President and Chief Executive Officer of the Company until July 17, 2017, the date that his successor, Robert Dawson, assumed the duties of President and Chief Executive Officer. In addition, from January 18, 2013 until June 7, 2013, Mr. Hill also served as the Company’s interim Chief Financial Officer. Mr. Hill has credits in Manufacturing Engineering, Quality Engineering and Industrial Management. He was the President of the Company from July 1993 until July 2011. He has held various positions in the electronics industry over the past 60 years.

 

William Reynolds is a retired financial executive. Mr. Reynolds most recently was the VP of Finance and Administration for Teledyne Controls from 1994 until his retirement in 1997. Prior thereto, for 22 years he was the Vice-President of Finance and Administration of Teledyne Microelectronics. Mr. Reynolds also was a program finance administrator of Teledyne Systems Company for five years. He has a B.B.A. degree in Accounting from Woodbury College.

 

Gerald T. Garland is currently the Managing Director at Inscite Consulting Group, a consulting firm for small to mid-sized businesses. Prior to joining Inscite Consulting, from April 2003 to February 2015, Mr. Garland was a Senior Vice President at TESSCO Technologies, a leading value-added distribution and solution provider for the wireless industry. Mr. Garland has served as senior vice president of the installation, test and maintenance line of business since May 2005, as senior vice president of the mobile devices and accessories line of business since April 2004 and as senior vice president of the network infrastructure line of business since April 2003. In July 2011, Mr. Garland began serving as Senior Vice President of the Commercial Segment. In April 2013, Mr. Garland began serving as Senior Vice President of the Product Lines of Business. Prior to joining TESSCO, Mr. Garland was Director of Business Development at American Express Tax and Business Services from 2002 to 2003, where he was involved in an expanded asset recovery capability for Fortune 1000 corporations. From 1993 to 1999, Mr. Garland was Chief Financial Officer and Treasurer at TESSCO during the company’s initial public offering. Mr. Garland received his MBA, with a concentration in Finance, from Loyola University, and his Bachelor of Science in Business Management and Accounting from Towson University.

 

The Company believes that Messrs. Benoit, Fink, Hill, Reynolds and Garland have the following qualifications as members of the Board of Directors:

 

Joseph Benoit: Mr. Benoit has significant financial management and banking experience, having served in various executive positions at Union Bank.

 

Marvin Fink: Mr. Fink has significant experience in a variety of areas important to overseeing the management and operations of this Company, including experience as an executive officer, an engineer and a lawyer. Mr. Fink has been the principal executive officer of a public company as well as the President of Teledyne’s Electronics Group. He has degrees in engineering and law and was involved in the electronics industry for over 40 years.

 

Howard Hill: Mr. Hill is a founder of the Company and has over 60 years of experience in the electronics industry.

 

William Reynolds: Mr. Reynolds has significant accounting and financial management expertise, having served as VP of Finance and Administration for Teledyne Controls, as the Vice-President of Finance and Administration of Teledyne Microelectronics, and as a program finance administrator of Teledyne Systems Company. He also has a degree in accounting, which enables him to serve as the “audit committee financial expert” of the Audit Committee.

 

 20 

 

 

Gerald T. Garland: Mr. Garland has significant leadership experience in product management, sales management, solutions development, global sourcing and financial management. Mr. Garland served as a Chief Financial Officer and Senior Vice President for a leading distributor and solutions provider to the wireless industry for over 18 years. Mr. Garland has also held senior leadership positions with Bank of America, Stanley Black & Decker, American Express and TESSCO Technologies.

 

Management

 

Robert D. Dawson, 43, President and Chief Executive Officer, was hired on July 17, 2017. Mr. Dawson was most recently President and Chief Executive Officer of Vision Technology Services, an information technology consulting and project management company that was acquired by BG Staffing. From 2007 to 2013 Mr. Dawson was employed at TESSCO Technologies, a publicly traded distributor of wireless products and services. While at TESSCO, he held multiple executive roles in sales, marketing, product management and strategy culminating with being Vice President of Sales, responsible for TESSCO’s sales organization and leading a team delivering more than $700 million in sales. He joined TESSCO through the 2007 acquisition of NetForce Solutions, a technology training and consulting firm that he co-founded in 2000 and led as the Chief Executive Officer through seven years of growth before being acquired by TESSCO. Mr. Dawson received his Bachelor’s degree in Business Administration, with a Marketing emphasis, from Hillsdale College. He has been a frequent speaker on wireless and telecommunications developments and trends, including Distributed Antenna Systems.

 

Mark Turfler, 65, Senior Vice President- Chief Financial Officer, was appointed as the Company’s Acting Chief Financial Officer and Corporate Secretary on June 7, 2013. Effective as of January 10, 2014, Mr. Turfler was promoted to Chief Financial Officer. Mr. Turfler joined the Company in January 2013 as our Controller. Prior to joining the Company, Mr. Turfler worked in senior accounting/finance positions at Ligand Pharmaceuticals, Inc. from 2006 to 2009, at Cylene Pharmaceuticals, Inc. from 2010 to 2011, and as an independent financial/accounting consultant from 2012 until he joined the Company in January 2013. Mr. Turfler has more than 35 years of accounting and finance experience including several years with publicly traded companies in a variety of senior financial executive positions with wireless telecommunications, international manufacturing, medical device and software companies. Mr. Turfler began his career with PricewaterhouseCoopers after graduating from Syracuse University with a B.S. in accounting. Mr. Turfler is a Certified Public Accountant and a member of the American Institute of CPAs, California Society of CPAs, Corporate Directors Forum and Financial Executives International.

 

Board of Director Meetings

 

During the fiscal year ended October 31, 2017, the Board of Directors held eleven meetings. During the fiscal year ended October 31, 2017, each Board of Directors members attended at least 75% of the meetings of the meetings of the committees on which he served.

 

Board Committees

 

During fiscal 2017, the Board of Directors maintained three committees, the Compensation Committee, the Audit Committee, and the Nominating and Corporate Governance Committee.

 

The Audit Committee meets periodically with the Company’s management and independent registered public accounting firm to, among other things, review the results of the annual audit and quarterly reviews and discuss the financial statements. The Audit Committee also hires the independent registered public accounting firm, and receives and considers the accountant’s comments as to controls, adequacy of staff and management performance and procedures. The Audit Committee is also authorized to review related party transactions for potential conflicts of interest and to conduct internal investigations into whistleblower complaints. During fiscal 2016 and until June 9, 2017, the Audit Committee was composed of Mr. Reynolds (Chairman), Mr. Benoit and Mr. Fink. On June 9, 2017, Mr. Garland was appointed to the Board of Directors and replaced Mr. Fink on the Audit Committee. Each of these individuals was a non-employee director and was independent as defined under the NASDAQ Stock Market’s listing standards. Each of the members of the Audit Committee has significant knowledge of financial matters, and Mr. Reynolds is an “audit committee financial expert.” The Audit Committee met five times during fiscal 2017. The Audit Committee operates under a formal charter, which charter is posted on the Company’s website.

 

The Compensation Committee currently consists of Messrs. Fink, Reynolds, and Benoit (Chairman) each of whom is a non-employee director and is independent as defined under the NASDAQ Stock Market’s listing standards. The Compensation Committee is responsible for considering and recommending to the Board the compensation arrangements for senior management. The Compensation Committee held six formal meetings during fiscal 2017, which was attended by all committee members.

 

The Nominating and Corporate Governance Committee is responsible for developing and recommending corporate governance guidelines to the Board, identifying qualified individuals to become directors, recommending selected nominees to serve on the Board, and overseeing the evaluation of the Board and its committees. The Nominating and Corporate Governance Committee currently consists of Messrs. Fink (Chairman), Benoit, and Reynolds, each of whom is a non-employee director and is independent as defined under the NASDAQ Stock Market’s listing standards. The Nominating and Corporate Governance Committee held one meeting during fiscal 2017, which was attended by all committee members.

 

Code of Business Conduct and Ethics

 

The Company has adopted a Code of Business Conduct and Ethics (the “Code”) that applies to all of the Company’s Directors, officers and employees, including its principal executive officer and principal financial officer. The Code is posted on the Company’s website at www.rfindustries.com. The Company intends to disclose any amendments to the Code by posting such amendments on its website. In addition, any waivers of the Code for Directors or executive officers of the Company will be disclosed in a report on Form 8-K.

 

 21 

 

 

Compliance With Section 16(a) of the Exchange Act

 

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s executive officers and directors, and persons who own more than 10% of a registered class of the Company’s equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission (“SEC”). Executive officers, directors and greater than 10% stockholders are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file.

 

Based solely upon a review of information furnished to the Company, to the Company’s knowledge, during the fiscal year ended October 31, 2017, all Section 16(a) reports were timely filed, except that William Reynolds and Gerald Garland were each late in filing a Form 4 (which was filed one day after the due date).

 

ITEM 11.EXECUTIVE COMPENSATION

 

Summary of Cash and Other Compensation. The following table sets forth compensation for services rendered in all capacities to the Company: (i) for each person who served as the Company’s Chief Executive Officer at any time during the past fiscal year, (ii) for each executive officer, other than our Chief Executive Officer, who was employed with the Company on October 31, 2017 and who earned over $100,000 during the fiscal year ended October 31, 2017, and (iii) for any officer who earned over $100,000 during the October 31, 2017 fiscal year but was no longer employed with the Company on October 31, 2017 (the foregoing executives are herein collectively referred to as the “Named Executive Officers”). No other executive officer of the Company received salary and bonus, which exceeded $100,000 in the aggregate, during the fiscal year ended October 31, 2017.

 

On October 31, 2016, Howard Hill assumed the position of interim President and Chief Executive Officer of the Company. On July 17, 2017, Robert D. Dawson was hired to serve as the President and Chief Executive Officer of the Company. Because Mr. Hill held the office of interim President and Chief Executive Officer of the Company during fiscal 2017, he is listed below as Named Executive Officers. However, Mr. Hill was not compensated in fiscal 2017 for his service as interim President and Chief Executive Officer of the Company in fiscal 2017.

 

Summary Compensation Table

 

Name and Principal Position  Year   Salary
($)
   Bonus
($)
   Stock
Awards
($)
   Option
Awards
($)(6)
   Non-Equity
Incentive Plan
Compensation
($)
   Nonqualified
Deferred
Compensation
Earnings
($)
   All Other
Compensation
($)
   Total
($)
 
Howard F. Hill                                             
Interim President and Chief Executive Officer and Director(1)   2017    -    -    -    -    -    -    6,440 (6)(7)   $6,440 
     2016    -    100,000(1)   -    8,750    -    -    76,015(2)   184,765 
                                              
Robert D. Dawson   2017    67,000    -    -    58,777    -    -    52,397(4)   178,174 
 President and Chief Executive Officer (3)                                             
                                              
Mark Turfler, SVP, Chief Financial Officer   2017    170,000    -    -    -    15,300(8)   -    -    185,300 
    2016    170,000    -    -    -    20,000    -    26,837(5)   216,837 

 

(1)       On April 7, 2016, Mr. Hill retired as an employee of the Company. In gratitude for his services to the Company for over 35 years, the Company’s Board of Directors paid Mr. Hill $100,000 upon his retirement. On October 31, 2016, Mr. Hill assumed the position of unpaid interim President and Chief Executive Officer of the Company, a position he held until July 17, 2017 when Robert D. Dawson was hired as the President and Chief Executive Officer.

 

(2)       Mr. Hill’s “Other Compensation” consisted of $76,015 in fiscal 2016, for accrued vacation.

 

(3)       Mr. Dawson joined the Company as President as of July 17, 2017 at an annual salary of $250,000.

 

(4)       As part of his employment agreement, the Company agreed to reimburse Mr. Dawson up to $75,000 for relocation expenses, of which Mr. Dawson was paid $52,397 in the fiscal year ended October 31, 2017.

 

(5)       Mr. Turfler’s other compensation consisted of $0 and $15,383 of accrued vacation in fiscal 2017 and 2016, respectively, and $0 and $11,454 for vehicle costs.

 

 22 

 

 

(6)       The amounts in this column represent the aggregate fair value of the option awards recognized by the Company as an expense for financial reporting purposes. The fair value of these awards and the amounts expensed were determined in accordance with Financial Accounting Standards Board ASC Topic 718. The assumptions we use in calculating these amounts are discussed in Note 9, “Stock options,” to the Consolidated Financial Statements.

 

(7)       Represents the value of a non-qualified stock option awarded to Mr. Hill on September 8, 2017, for advisory services he rendered to the Company from July 17, 2017 through the end of the Company’s fiscal year.

 

(8)       For the fiscal year ended October 31, 2017, the Company adopted corporate goals for the determination of cash bonuses to be paid to Mark Turfler, the Company’s Chief Financial Officer.  The target bonus payable to Mr. Turfler was 40% of his 2017 base salary ($170,000).  The cash bonus was based upon (i) the Company’s subjective determination of his performance (30% of the bonus) and (ii) the achievement by the Company of certain EBITDA targets for the fiscal year ended October 31, 2017 (70% of the bonus).  The Company did not achieve its EBITDA targets, and Mr. Turfler did not receive this portion of the bonus.  However, the Company determined that Mr. Turfler met certain of his subjective performance goals and, therefore, was awarded a cash bonus of $15,300.

 

2017 Option Grants

 

Upon the appointment of Robert D. Dawson as President and Chief Executive Officer on July 17, 2017, the Company granted Mr. Dawson options to purchase 100,000 shares of common stock. The stock options are subject to the terms and conditions of the Company’s 2010 Stock Incentive Plan, have an exercise price of $1.90 (the closing trading price on the Nasdaq Stock Market on July 17, 2017), and vest as to 10,000 shares per year, with 10,000 shares having vested on July 17, 2017 and 10,000 shares vesting on each anniversary thereafter while he is employed by the Company.

 

Holdings of Previously Awarded Equity

 

Equity awards held as of October 31, 2017 by each of our Named Executive Officers were issued under our 2010 Stock Incentive Plan. The following table sets forth outstanding equity awards held by our Named Executive Officers as of October 31, 2017:

 

Outstanding Equity Awards As Of October 31, 2017

 

   Option Awards
Name  Number of
Securities
Underlying
Unexercised
Options
 (#) Exercisable
   Number of
Securities
Underlying
Unexercised
Options
 (#) Unexercisable
   Equity Incentive Plan
Awards: Number of
Securities Underlying
Unexercised
Unearned Options
(#)
   Option
Exercise
Price
($)
   Option
Expiration
Date
                    
Howard Hill   4,000         -    5.88   04/11/19
Howard Hill   4,000         -    4.41   11/19/19
Howard Hill   8,733         -    4.07   04/05/20
Howard Hill   33,744         -    2.30   04/07/21
Howard Hill   77,339         -    1.50   11/08/21
Howard Hill   15,000         -    1.80   09/08/22
Mark Turfler   40,000         60,000(1)   5.88   04/11/24
Mark Turfler   19,000              4.41   11/19/19
Robert D. Dawson   10,000         90,000(2)    1.90   07/17/27

 

(1)Vests as to 10,000 shares annually following grant on April 11, 2014.
(2)Vests as to 10,000 shares annually following grant on July 17, 2017.

 

During the fiscal year ended October 31, 2017, the Company did not adjust or amend the exercise price of stock options awarded to the Named Executive Officers.

 

Employment Agreements-Change of Control Payments

 

On June 16, 2017, RF Industries, Ltd. entered into an employment letter agreement with Robert D. Dawson, under which Mr. Dawson has served as the Company’s President and Chief Executive Officer since July 17, 2017.

 

Under Mr. Dawson’s agreement, the Company agreed to pay Mr. Dawson an annual base salary of $250,000. Mr. Dawson also is eligible to participate in the Company’s annual bonus plan, pursuant to which he has the opportunity to earn a year-end bonus equal to fifty percent (50%) of his annual base salary. The actual bonus paid may be higher or lower than the annual bonus based on the over- or under-achievement of Company and individual objectives as determined by the Company’s Board of Directors or its Compensation Committee. It is currently anticipated that 80% of Mr. Dawson’s Annual Bonus will be based on the Company’s performance and 20% will be based on the achievement of individual objectives.

 

 23 

 

 

In addition, as of July 17, 2017, Mr. Dawson received stock options to purchase 100,000 shares of the Company’s common stock. The award has an exercise price of $1.90 vests as to 10,000 shares per year on each anniversary of July 17, 2017 (with 10,000 shares having vested on July 17, 2017) while he is employed by the Company. Mr. Dawson is also entitled to be paid or reimbursed up to an aggregate of $75,000 in relocation expenses, and is eligible to participate in the employee benefit plans and programs generally available to the Company’s senior executives, subject to the terms and conditions of such plans and programs.

 

The term of Mr. Dawson’s agreement is one year. After the first anniversary, Mr. Dawson’s employment will automatically renew, and his period of employment will automatically be extended for an additional one-year period, unless either party provides the other party with written notice of non-renewal at least sixty (60) days prior to the date of automatic renewal. Upon a Change of Control Transaction (as defined in the letter agreement), all of Mr. Dawson’s time based stock options shall immediately vest, whether or not his employment is terminated. If at the time of a Change of Control Transaction Mr. Dawson’s employment is terminated by the Company for any reason other than Cause (as defined), Mr. Dawson will be entitled to receive a change of control cash payment in an amount equal to 12 months of his salary

 

Mark Turfler, the Company’s Chief Financial Officer, is currently employed on an at-will basis pursuant to an unwritten employment agreement.  Mr. Turfler’s current annual base salary is $170,000, and he is entitled to participate in the Company’s pension, retirement, disability, insurance, medical service, or other employee benefit plan that are generally available to all employees of the Company.  In addition, under the Company’s non-equity incentive plan, Mr. Turfler has the right to earn an annual cash bonus of up to 50% of his annual base salary, subject to meeting certain qualitative and subjective targets.  The foregoing 50% bonus payment is subject to increase to up to 67% in the event that certain higher performance targets are achieved.  The cash bonus is based on the Company’s earnings per share (before payment of bonuses) for the fiscal year ending October 31, 2018.

 

The Company has no other change of control payment agreements in effect.

 

Compensation of Directors

 

Under the compensation policies adopted by the Compensation Committee, directors who also are officers and/or employees of the Company do not receive any compensation for serving on the Board. For the year ended October 31, 2017, non-employee directors (i.e. directors who are not employed by the Company as officers or employees) received $50,000, which amount was paid one-half in cash, and one-half through the grant of stock options to purchase shares of the Company’s common stock.

 

DIRECTOR COMPENSATION FOR FISCAL YEAR 2017

 

Name  Fees
Earned or
Paid in
Cash
   Stock
Awards
   Option
Awards (1)(2)
   All Other
Compensation
   Total 
                     
Joseph Benoit  $25,000    -   $25,000   $-   $50,000 
Marvin H. Fink  $25,000    -   $25,000   $-   $50,000 
Howard F. Hill  $25,000    -   $25,000   $-   $50,000 
William Reynolds  $25,000    -   $25,000   $-   $50,000 
Gerald Garland  $9,863    -   $9,863   $-   $19,726 

   

(1)This column represents the aggregate grant date fair value of option awards computed in accordance with FASB ASC Topic 718, excluding the effect of estimated forfeitures related to service-based vesting conditions. These amounts do not correspond to the actual value that will be recognized by the named directors from these awards.

 

(2)On November 8, 2016, the Company granted five-year non-qualified options to purchase 77,339 shares of the Company’s common stock to each of Mr. Marvin Fink (Chairman), Mr. William Reynolds, Joseph Benoit and Howard Hill for their services as directors for the fiscal year ended October 31, 2017. The options have an exercise price of $1.50 per share. On June 9, 2017, the Company granted Mr. Garland a five-year non-qualified option with a $1.65 exercise price to purchase 24,712 shares of the Company’s common stock for his services as a director from June 9, 2017 through October 31, 2017.

 

ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 

The following table sets forth certain information regarding the ownership of the Company’s Common Stock as of January 22, 2018 for: (i) each director; (ii) the Company’s Named Executive Officers; (iii) all executive officers and directors of the Company as a group; and (iv) all those known by the Company to be beneficial owners of more than 5% of the Common Stock. As of January 22, 2018, there were 8,872,246 shares of Common Stock issued and outstanding.

 

 24 

 

 

Name and Address of Beneficial Owner  Number of Shares  (1)
Beneficially Owned
   Percentage
Beneficially Owned
 
         
Howard H. Hill   376,519(2)   4.2%
           
Marvin H. Fink   135,066(3)   1.5%
           
William Reynolds   151,103(4)   1.7%
           
Joseph Benoit   131,028(5)   1.5%
           
Mark Turfler   61,495(6)   0.7%
           
Robert D. Dawson

   20,000(7)   0.2%
Gerald Garland   54,222(8)   0.6%
           
All Directors and Officers as a Group (7 Persons)   929,433(9)   9.8%
           
Hytek International, Ltd
PO Box 10927 APO
George Town
Cayman Islands
   901,860(10)   10.2%
           
Renaissance Technologies LLC
800 Third Avenue
New York, New York 10022
   657,100(11)   7.4%

 

  (1) Shares of Common Stock, which were not outstanding but which could be acquired upon exercise of an option within 60 days from the date of this filing, are considered outstanding for the purpose of computing the percentage of outstanding shares beneficially owned. However, such shares are not considered to be outstanding for any other purpose.
     
  (2) Includes 152,298 shares that Mr. Hill has the right to acquire upon exercise of options exercisable within 60 days.
     
  (3) Includes 135,066 shares that Mr. Fink has the right to acquire upon exercise of options exercisable within 60 days.
     
  (4) Includes 98,303 shares that Mr. Reynolds has the right to acquire upon exercise of options exercisable within 60 days.
     
  (5) Includes 131,028 shares that Mr. Benoit has the right to acquire upon exercise of options exercisable within 60 days.
     
  (6) Includes 59,000 shares, which Mr. Turfler has the right to acquire upon exercise of options exercisable within 60 days.
     
  (7) Includes 10,000 shares, which Mr. Dawson has the right to acquire upon exercise of options exercisable within 60 days.
     
  (8) Includes 34,194 shares, which Mr. Garland has the right to acquire upon exercise of options exercisable within 60 days.
     
  (9) Includes 619,889 shares, which the directors and officers have the right to acquire upon exercise of options exercisable within 60 days.
     
  (10) Based on records with the Company’s transfer agent as of September 30, 2017.
     
  (11) Based on a Schedule 13F filed with the SEC by Renaissance Technologies LLC and Renaissance Technologies Holdings Corporation on as of September 30, 2017.

 

ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

 

None.

 

 25 

 

 

ITEM 14.PRINCIPAL ACCOUNTING FEES AND SERVICES

 

Audit Fees

 

The following is a summary of the fees billed to the Company by CohnReznick LLP, the Company’s independent registered public accounting firm, for professional services rendered related to the fiscal years ended October 31, 2017 and 2016:

 

Fee Category  2017   2016 
Audit Fees  $202,000   $259,000 
Audit-Related Fees   -    - 
All Other Fees   10,000    10,000 
Total Fees  $212,000   $269,000 

 

Audit Fees. Consists of fees billed for professional services rendered for the audit of the Company’s annual financial statements and review of the interim financial statements included in quarterly reports and services that are normally provided by CohnReznick LLP in connection with statutory and regulatory filings or engagements.

 

Audit-Related Fees. Consists of fees billed for assurance and related services that are reasonably related to the performance of the audit and review of the Company’s financial statements and are not reported under “Audit Fees.” These services include professional services requested by the Company in connection with its preparation for compliance with Section 404 of the Sarbanes-Oxley Act of 2002, accounting consultations in connection with acquisitions and consultations concerning financial accounting and reporting standards. The Company did not incur audit-related fees during fiscal 2017 and 2016.

 

All Other fees. The Company engaged CohnReznick LLP in 2017 and 2016 to perform an audit of the Company’s 401K plan.

 

ITEM 15.EXHIBITS

 

The following exhibits are filed as part of this report:

  

3.1Amended and Restated Articles of Incorporation (2)

 

3.2Amended and Restated By-Laws (3)

 

3.3Amendment No. 1 to Amended and Restated Bylaws (4)

  

10.1Multi-Tenant Industrial Gross Lease, effective March 31, 2009, between RF Industries, Ltd. and Walton CWCA Miramar GL 74, LLC regarding the Company’s facilities in San Diego (5)

 

10.2Second Amendment to Lease, dated August 25, 2009, to Multi-Tenant Industrial Gross Lease, effective March 31, 2009, between RF Industries, Ltd. and Walton CWCA Miramar GL 74, LLC (5)

 

10.3Single Tenant Commercial Lease, dated June 15, 2011 between K&K and RF Industries, Ltd. regarding the Company’s lease in Yaphank, New York (7)

 

10.4Form of 2010 Stock Incentive Plan (6)

 

10.5Form of Stock Option Agreement for the Company’s 2010 Stock Incentive Plan (6)

 

10.6Stock Purchase Agreement, dated January 20, 2015, between RF Industries, Ltd. and Robert A. Portera (8)

 

10.7Stock Purchase Agreement, dated June 5, 2015, between RF Industries, Ltd., Rel-Tech Electronics, Inc., and the Shareholders.(9)

 

10.8Employment Agreement, dated December 23, 2015, by and among RF Industries, Ltd. and Johnny Walker.(10)#

 

10.9Employment Agreement, dated December 23, 2015, by and among RF Industries, Ltd. and Mark Turfler.(10)#

 

10.10Employment Agreement, dated December 23, 2015, by and among RF Industries, Ltd. and Darren Clark. (10)#

 

10.11Multi-Tenant Industrial Gross Lease, effective December 1, 2007, between Rel-Tech Electronics, Inc. and D’Amato Investments, LLC regarding the Company’s lease in Milford, CT, as amended to date(11)

 

10.12Multi-Tenant Industrial Gross Lease, effective January 12, 2012, between Comnet Telecom Supply Inc. and EB3, LLC regarding the Company’s lease in East Brunswick, NJ (11).

 

 26 

 

 

10.13Separation and Release of Claims Agreement, dated October 24, 2016, by and among RF Industries, Ltd. and Johnny Walker.(12)#

 

10.14Third Amendment To Lease, by and between Icon Miramar Owner Pool 2 West/Northeast/Midwest, LLC and the Company, dated April 17, 2014 (13)

 

10.15Fourth Amendment To Lease, by and between Icon Miramar Owner Pool 2 West/Northeast/Midwest, LLC and the RF Industries, Ltd., dated January 26, 2017

 

10.16Fifth Amendment To Lease, by and between Icon Miramar Owner Pool 2 West/Northeast/Midwest, LLC and the RF Industries, Ltd., dated June 5, 2017 (14)

 

10.17Amendment To Lease, by and between K & K Unlimited and Cables Unlimited, Inc., dated June 9, 2017 (14)

 

10.18Employment Letter Agreement, dated June 16, 2017, by and between RF Industries, Ltd. and Robert D. Dawson (15)#

 

10.19Fifth Amendment To Lease, by and between Icon Kimberly Alvin Property, LLC and Comnet Telecom Supply, Inc., dated June 19, 2017 (16)

 

10.20Lease Agreement by and between D’Amato Investments, LLC and Rel-Tech Electronics, Inc., dated July 25, 2017 (17)

 

10.21Form of Indemnification Agreement (18)#

 

14.1Code of Ethics (1)

 

21.1List of Subsidiaries

 

23.1Consent of Independent Registered Public Accounting Firm CohnReznick LLP

 

31.1Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

31.2Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

32.1Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350

 

32.2Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350

 

EX-101.INSXBRL Instance Document

 

EX-101.SCHXBRL Taxonomy Extension Schema

 

EX-101.CALXBRL Taxonomy Extension Calculation Linkbase

 

EX-101.DEFXBRL Taxonomy Extension Definition Linkbase

 

EX-101.LABXBRL Taxonomy Extension Label Linkbase

 

EX-101.PREXBRL Taxonomy Extension Presentation Linkbase

  

 

#Indicates a management contract or compensatory plan or arrangement.

 

 27 

 

 

(1)           Previously filed as an exhibit to the Company’s Form 10-KSB for the year ended October 31, 2000, which exhibit is hereby incorporated herein by reference.

 

(2)           Previously filed as an exhibit to the Company’s Form 10- KSB for the year ended October 31, 1987, which exhibit is hereby incorporated herein by reference.

 

(3)           Previously filed as an exhibit to the Company’s Form 10- KSB for the year ended October 31, 1992, which exhibit is hereby incorporated herein by reference.

 

(4)           Previously filed as an exhibit to the Company’s Form 10- KSB for the year ended October 31, 2003, which exhibit is hereby incorporated herein by reference.

 

(5)           Previously filed as an exhibit to the Company’s Form 8-K, dated June 9, 2006, which exhibit is hereby incorporated herein by reference.

 

(6)           Previously filed as an exhibit to the Company’s Form 10- KSB for the year ended October 31, 2007, which exhibit is hereby incorporated herein by reference.

 

(7)           Previously filed as an exhibit to the Company’s Form 10- K for the year ended October 31, 2009, which exhibit is hereby incorporated herein by reference.

 

(8)           Previously filed as an exhibit to the Company’s Registration Statement on Form S-8, filed on September 20, 2010, which exhibit is hereby incorporated herein by reference.

 

(9)           Previously filed as an exhibit to the Company’s definitive proxy statement filed on July 12, 2012, which exhibit is hereby incorporated herein by reference.

 

(10)         Previously filed as an exhibit to the Company’s Form 10- K for the year ended October 31, 2011, which exhibit is hereby incorporated herein by reference.

 

(11)         Previously filed as an exhibit to the Company’s Form 8-K, dated January 20, 2015, which exhibit is hereby incorporated herein by reference.

 

(12)         Previously filed as an exhibit to the Company’s Form 8-K, dated January 21, 2015, which exhibit is hereby incorporated herein by reference.

 

(13)         Previously filed as an exhibit to the Company’s Form 8-K, dated June 5, 2015, which exhibit is hereby incorporated herein by reference.

 

(14)         Previously filed as an exhibit to the Company’s Form 8-K, dated December 24, 2015, which exhibit is hereby incorporated herein by reference.

 

(15)         Previously filed as an exhibit to the Company’s Form 10-K for the year ended October 31, 2015, which exhibit is hereby incorporated herein by reference.

 

(16)         Previously filed as an exhibit to the Company’s Form 8-K, dated October 25, 2016, which exhibit is hereby incorporated herein by reference.

 

(17)         Previously filed as an exhibit to the Company’s Form 8-K, dated May 1, 2014, which exhibit is hereby incorporated herein by reference.

 

(18)         Previously filed as an exhibit to the Company’s Form 8-K, dated June 5, 2017, which exhibit is hereby incorporated herein by reference.

 

(19)         Previously filed as an exhibit to the Company’s Form 8-K, dated June 20, 2017, which exhibit is hereby incorporated herein by reference.

 

 28 

 

 

(20)         Previously filed as an exhibit to the Company’s Form 8-K, dated June 21, 2017, which exhibit is hereby incorporated herein by reference.

 

(21)         Previously filed as an exhibit to the Company’s Form 8-K, dated July 28, 2017, which exhibit is hereby incorporated herein by reference.

 

(22)         Previously filed as an exhibit to the Company’s Form 8-K, dated September 12, 2017, which exhibit is hereby incorporated herein by reference.

 

Stockholders of the Company may obtain a copy of any exhibit referenced in this Annual Report on Form 10-K by writing to: Secretary, RF Industries, Ltd., 7610 Miramar Road, Bldg. 6000, San Diego, CA 92126. The written request must specify the stockholder’s good faith representation that such stockholder is a stockholder of the Company.

 

 29 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

 

Index

 

    Page
     
Report of Independent Registered Public Accounting Firm   F-2
     
Consolidated Balance Sheets October 31, 2017 and 2016   F-3 - F-4
     
Consolidated Statements of Operations Years Ended October 31, 2017 and 2016   F-5
     
Consolidated Statements of Stockholders’ Equity Years Ended October 31, 2017 and 2016   F-6
     
Consolidated Statements of Cash Flows Years Ended October 31, 2017 and 2016   F-7
     
Notes to Consolidated Financial Statements   F-8 - F-19

 

*       *       *

 

 F-1 

 

 

Report of Independent Registered Public Accounting Firm

 

To the Board of Directors and Stockholders

of RF Industries, Ltd.

 

We have audited the accompanying consolidated balance sheets of RF Industries, Ltd. and Subsidiaries as of October 31, 2017 and 2016, and the related consolidated statements of operations, stockholders’ equity and cash flows for the years then ended. RF Industries, Ltd. and Subsidiaries’ management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of RF Industries, Ltd. and Subsidiaries as of October 31, 2017 and 2016, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

 

/s/ CohnReznick LLP  
   
San Diego, California  
January 24, 2018  

 

 F-2 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

OCTOBER 31, 2017 AND 2016

(In thousands, except share and per share amounts)

 

   2017   2016 
ASSETS          
           
CURRENT ASSETS          
Cash and cash equivalents  $6,039   $5,258 
Trade accounts receivable, net of allowance for doubtful accounts of $73 and $62, respectively   3,901    4,077 
Inventories   6,109    6,022 
Other current assets   744    1,436 
TOTAL CURRENT ASSETS   16,793    16,793 
           
Property and equipment:          
Equipment and tooling   3,302    3,203 
Furniture and office equipment   871    799 
    4,173    4,002 
Less accumulated depreciation   3,462    3,174 
Total property and equipment   711    828 
           
Goodwill   3,219    3,219 
Amortizable intangible assets, net   3,030    3,619 
Non-amortizable intangible assets   1,237    1,237 
Other assets   70    141 
TOTAL ASSETS  $25,060   $25,837 

 

 F-3 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

OCTOBER 31, 2017 AND 2016

(In thousands, except share and per share amounts)

 

   2017   2016 
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
CURRENT LIABILITIES          
Accounts payable  $1,356   $1,138 
Accrued expenses   2,242    2,770 
TOTAL CURRENT LIABILITIES   3,598    3,908 
           
Deferred tax liabilities, net   119    409 
Other long-term liabilities   -    128 
TOTAL LIABILITIES   3,717    4,445 
           
COMMITMENTS AND CONTINGENCIES          
           
STOCKHOLDERS’ EQUITY          
           
Common stock - authorized 20,000,000 shares of $0.01 par value; 8,872,246 and 8,835,483 shares issued and outstanding at October 31, 2017 and 2016, respectively   89    88 
Additional paid-in capital   19,654    19,379 
Retained earnings   1,600    1,925 
TOTAL STOCKHOLDERS' EQUITY   21,343    21,392 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $25,060   $25,837 

 

See Notes to Consolidated Financial Statements.

 

 F-4 

 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

YEARS ENDED OCTOBER 31, 2017 AND 2016

(In thousands, except share and per share amounts)

 

   2017   2016 
         
Net sales  $30,964   $30,241 
Cost of sales   22,242    21,778 
           
Gross profit   8,722    8,463 
           
Operating expenses:          
Engineering   845    747 
Selling and general   7,506    9,560 
Goodwill and other intangible asset impairment   -    2,844 
Total operating expense   8,351    13,151 
           
Operating income (loss)   371    (4,688)
           
Other income   29    5 
           
Income (loss) from continuing operations before provision (benefit) for income taxes   400    (4,683)
Provision (benefit) for income taxes   134    (652)
           
Income (loss) from continuing operations   266    (4,031)
           
Income (loss) from discontinued operations, net of tax   116    (58)
           
Consolidated net income (loss)  $382   $(4,089)
           
Earnings (loss) per share          
Basic          
Continuing operations  $0.03   $(0.46)
Discontinued operations   0.01    (0.01)
Net income (loss) per share  $0.04   $(0.47)
           
Earnings (loss) per share          
Diluted          
Continuing operations  $0.03   $(0.46)
Discontinued operations   0.01    (0.01)
Net income (loss) per share  $0.04   $(0.47)
           
Weighted average shares outstanding          
Basic   8,840,895    8,786,510 
Diluted   8,915,764    8,786,510 

 

See Notes to Consolidated Financial Statements.

 

 F-5 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

YEARS ENDED OCTOBER 31, 2017 AND 2016

(In thousands, except share amounts)

 

           Additional         
   Common Stock   Paid-In   Retained     
   Shares   Amount   Capital   Earnings   Total 
Balance, November 1, 2015   8,713,664   $87   $19,129   $7,155   $26,371 
                          
Exercise of stock options   180,067    2    47    -    49 
                          
Excess tax benefit from exercise of stock options   -    -    154    -    154 
                          
Stock-based compensation expense   -    -    206    -    206 
                          
Dividends   -    -    -    (1,141)   (1,141)
                          
Treasury stock purchased and retired   (58,248)   (1)   (157)   -    (158)
                          
Net loss   -    -    -    (4,089)   (4,089)
                          
Balance, October 31, 2016   8,835,483    88    19,379    1,925    21,392 
                          
Exercise of stock options   36,763    1    55    -    56 
                          
Excess tax benefit from exercise of stock options   -    -    6    -    6 
                          
Stock-based compensation expense   -    -    214    -    214 
                          
Dividends   -    -    -    (707)   (707)
                          
Net Income   -    -    -    382    382 
                          
Balance, October 31, 2017   8,872,246   $89   $19,654   $1,600   $21,343 

 

See Notes to Consolidated Financial Statements.

 

 F-6 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED OCTOBER 31, 2017 AND 2016

(In thousands)

   2017   2016 
OPERATING ACTIVITIES:          
Consolidated net income (loss)  $382   $(4,089)
Adjustments to reconcile consolidated net income (loss) to net cash provided by (used in) operating activities:          
Bad debt expense   11    9 
Depreciation and amortization   877    1,036 
Goodwill and other intangible asset impairment   -    2,844 
Inventory write-downs   -    168 
Gain (loss) on disposal of fixed assets   -    68 
Stock-based compensation expense   214    206 
Deferred income taxes   (290)   (307)
Excess tax benefit from stock-based compensation   (6)   (154)
Changes in operating assets and liabilities:          
Trade accounts receivable   165    (107)
Inventories   (87)   417 
Other current assets   698    (554)
Other long-term assets   71    (102)
Accounts payable   218    (355)
Accrued expenses   (528)   (98)
Other long-term liabilities   (128)   (249)
Net cash provided by (used in) operating activities   1,597    (1,267)
           
INVESTING ACTIVITIES:          
Proceeds from notes receivable from stockholder   -    67 
Proceeds from sale of fixed assets   -    22 
Proceeds from sale of inventory   -    321 
Capital expenditures   (171)   (384)
Net cash (used in) provided by investing activities   (171)   26 
           
FINANCING ACTIVITIES:          
Proceeds from exercise of stock options   56    49 
Purchases of treasury stock   -    (158)
Excess tax benefit from exercise of stock options   6    154 
Dividends paid   (707)   (1,141)
Net cash used in financing activities   (645)   (1,096)
           
Net increase (decrease) in cash and cash equivalents   781    (2,337)
           
Cash and cash equivalents, beginning of year   5,258    7,595 
           
Cash and cash equivalents, end of year  $6,039   $5,258 
           
Supplemental cash flow information – income taxes paid  $349   $208 
           
Supplemental schedule of noncash investing and financing activities:           
Retirement of treasury stock  $-   $157 

 

See Notes to Consolidated Financial Statements.

 

 F-7 

 

 

RF INDUSTRIES, LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

Note 1 - Business activities and summary of significant accounting policies

 

Business activities

 

RF Industries, Ltd., together with its three wholly-owned subsidiaries (collectively, hereinafter the “Company”), primarily engages in the design, manufacture, and marketing of interconnect products and systems, including coaxial and specialty cables, fiber optic cables and connectors, and electrical and electronic specialty cables. For internal operating and reporting purposes, and for marketing purposes, as of the end of the fiscal year ended October 31, 2017 the Company classified its operations into the following four divisions/subsidiaries: (i) The RF Connector and Cable Assembly division designs, manufactures and distributes coaxial connectors and cable assemblies that are integrated with coaxial connectors; (ii) Cables Unlimited, Inc., the subsidiary that manufactures custom and standard cable assemblies, complex hybrid fiber optic power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive and medical equipment; (iii) Comnet Telecom Supply, Inc., the subsidiary that manufactures and sells fiber optics cable, distinctive cabling technologies and custom patch cord assemblies, as well as other data center products; and (iv) Rel-Tech Electronics, Inc., the subsidiary that designs and manufacturers of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers. Both the Cables Unlimited division and the Comnet Telecom division are Corning Cables Systems CAH Connections SM Gold Program members that are authorized to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems’ extended warranty. During the fiscal year ended October 31, 2016, RF Industries, Ltd. sold the Aviel Electronics division that designed, manufactured and distributed specialty and custom RF connectors, and discontinued the Bioconnect division that manufactured and distributed cabling and interconnect products to the medical monitoring market.

 

Use of estimates 

 

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results may differ from those estimates.

 

Principles of consolidation

 

The accompanying consolidated financial statements include the accounts of RF Industries, Ltd., Cables Unlimited, Inc. (“Cables Unlimited”), Comnet Telecom Supply, Inc. (“Comnet”), and Rel-Tech Electronics, Inc. (“Rel-Tech”), wholly-owned subsidiaries of RF Industries, Ltd. All intercompany balances and transactions have been eliminated in consolidation.

 

Cash equivalents

 

The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

 

Revenue recognition

 

Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and for shipments with terms of FOB Shipping Point, revenue is recognized upon shipment, for shipments with terms of FOB Destination, revenue is recognized upon delivery and revenue from services is recognized when services are performed, and the recovery of the consideration is considered probable.

 

Inventories

 

Inventories are stated at the lower of cost or market, with cost determined using the weighted average cost of accounting. Cost includes materials, labor, and manufacturing overhead related to the purchase and production of inventories. We regularly review inventory quantities on hand, future purchase commitments with our suppliers, and the estimated utility of our inventory. If our review indicates a reduction in utility below carrying value due to damage, physical deterioration, obsolescence, changes in price levels, or other causes, we reduce our inventory to a new cost basis through a charge to cost of sales in the period in which it occurs. The determination of market value and the estimated volume of demand used in the lower of cost or market analysis requires significant judgment.

 

In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech prospectively values its inventories cost using the weighted average cost of accounting.

 

Property and equipment

 

Equipment, tooling and furniture are recorded at cost and depreciated over their estimated useful lives (generally 3 to 5 years) using the straight-line method. Expenditures for repairs and maintenance are charged to operations in the period incurred.

 

 F-8 

 

 

Goodwill

 

Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Goodwill is not amortized, but is subject to impairment analysis at least once annually, which the Company performs in October, or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value.

 

We assess whether a goodwill impairment exists using both qualitative and quantitative assessments at the reporting level. Our qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we will not perform a quantitative assessment.

 

If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if we elect not to perform a qualitative assessment, we perform a quantitative assessment, or two-step impairment test, to determine whether a goodwill impairment exists at the reporting unit. The first step in our quantitative assessment identifies potential impairments by comparing the estimated fair value of the reporting unit to its carrying value, including goodwill (“Step 1”). If the carrying value exceeds estimated fair value, there is an indication of potential impairment and the second step is performed to measure the amount of impairment (“Step 2”).

 

For the fiscal year 2016, Cables Unlimited did not meet its sales volume and revenue goals, and the mix of product sold had lower margins than planned. These results, along with changes in the competitive marketplace and an evaluation of business priorities, led to a shift in strategic direction and reduced future revenue and profitability expectations for the business. The results of these changes and circumstances lead to the determination that Cables Unlimited did not pass our qualitative assessment and therefore a quantitative assessment was required.

 

Upon completion of our Step 1 test, we found that the results indicated that Cables Unlimited’s carrying value exceeded its estimated fair value, and as a result, the Step 2 test was performed specific to Cables Unlimited. Under Step 2, the fair value of all assets and liabilities were estimated, including customer list and backlog, for the purpose of deriving an estimate of the fair value of goodwill. The fair value of the goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Assumptions used in measuring the value of these assets and liabilities included the discount rates used in valuing the intangible assets, and consideration of the market environment in valuing the tangible assets.

 

Upon completion of our Step 2 test, our Cables Unlimited division’s goodwill was determined to be impaired. As of October 31, 2016, the Company recorded a $2.6 million impairment charge to goodwill. Cables Unlimited’s goodwill is included in the Custom Cabling Manufacturing and Assembly segment.

 

No other instances of impairment were identified as of October 31, 2016 and no instances of goodwill impairment were identified during the year ended October 31, 2017.

 

On June 15, 2011, the Company completed its acquisition of Cables Unlimited. Goodwill related to this acquisition is included within the Cables Unlimited reporting unit. Effective November 1, 2014, the Company also completed its acquisition of Comnet. Goodwill related to this acquisition is included within the Comnet reporting unit. As of May 19, 2015, the Company completed its acquisition of the CompPro product line. Goodwill related to this acquisition is included within the Connector and Cable Assembly Division. Effective June 1, 2015, the Company completed its acquisition of Rel-Tech. Goodwill related to this acquisition is included within the Rel-Tech reporting unit.

 

Long-lived assets

 

The Company assesses property, plant and equipment and intangible assets, which are considered definite-lived assets for impairment. Definite-lived assets are reviewed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. The Company has made no material adjustments to our long-lived assets in any of the years presented.

 

The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment.

 

In addition, the Company tests our trademarks and indefinite-lived asset for impairment at least annually or more frequently if events or changes in circumstances indicate that these assets may be impaired.

 

In 2016, upon completion of our Step 2 test (see “Goodwill” above), our Cables Unlimited division’s trademark was determined to be impaired. As of October 31, 2016, the Company recorded a $150,000 impairment charge to its trademark. Cables Unlimited’s trademark is included in the Custom Cabling Manufacturing and Assembly segment.

 

 F-9 

 

 

No instances of impairment were identified as of October 31, 2017 and no other instances of impairment were identified as of October 31, 2016.

 

Earn-out liability

 

The purchase agreement for the Rel-Tech acquisition provides for earn-out payments of up to $800,000 in the aggregate, last installment of which is payable May 31, 2018. The initial earn-out liability was valued at its fair value using the Monte Carlo simulation and is included as a component of the total purchase price. The earn-out was and will continue to be revalued quarterly using a present value approach and any resulting increase or decrease will be recorded into selling and general expenses. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. Significant judgment is employed in determining the appropriateness of the assumptions used in calculating the fair value of the earn-out as of the acquisition date. Accordingly, significant variances between actual and forecasted results or changes in the assumptions can materially impact the amount of contingent consideration expense we record in future periods.

 

The Company measures at fair value certain financial assets and liabilities. U. S. GAAP specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. These two types of inputs have created the following fair-value hierarchy:

 

Level 1— Quoted prices for identical instruments in active markets;

 

Level 2— Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and

 

Level 3— Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

 

The contingent consideration liability represents future earn-out liability that we may be required to pay in conjunction with the acquisition of Rel-Tech and Comnet. The Company estimates the fair value of the earn-out liability using a probability-weighted scenario of estimated qualifying earn-out gross profit related to Rel-Tech and EBITDA related to Comnet calculated at net present value (level 3 of the fair value hierarchy).

 

The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2017 (in thousands):

 

Description  Level 1   Level 2   Level 3 
Earn-out liability  $-   $-   $236 

 

The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in thousands):

 

Description  Level 1   Level 2   Level 3 
Earn-out liability  $-   $-   $835 

 

The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):

 

   Level 3 
   2017   2016 
Beginning balance  $835   $1,527 
Payments   (578)   (790)
Change in value   (21)   98 
Ending Balance  $236   $835 

 

Intangible assets

 

Intangible assets consist of the following as of October 31 (in thousands): 

 

 F-10 

 

 

   2017   2016 
Amortizable intangible assets:          
Non-compete agreements (estimated lives 3 - 5  years)  $310   $310 
Accumulated amortization   (310)   (273)
    -    37 
           
Customer relationships (estimated lives 7 - 15 years)   5,099    5,099 
Accumulated amortization   (2,186)   (1,644)
    2,913    3,455 
           
Patents (estimated life 14 years)   142    142 
Accumulated amortization   (25)   (15)
    117    127 
           
Totals  $3,030   $3,619 
           
Non-amortizable intangible assets:          
Trademarks  $1,237   $1,237 

 

Amortization expense for the years ended October 31, 2017 and 2016 was $589,000 and $649,000, respectively.

 

Impairment to trademarks for the years ended October 31, 2017 and 2016 was $0 and $150,000, respectively.

 

Estimated amortization expense related to finite lived intangible assets is as follows (in thousands):

 

Year ending    
October 31,  Amount 
     
2018  $553 
2019   553 
2020   553 
2021   413 
2022   413 
Thereafter   545 
Total  $3,030 

 

Advertising

 

The Company expenses the cost of advertising and promotions as incurred. Advertising costs charged to operations were approximately $130,000 and $156,000 in 2017 and 2016, respectively.

 

Research and development

 

Research and development costs are expensed as incurred. The Company’s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively.

 

Income taxes

 

The Company accounts for income taxes under the asset and liability method, based on the income tax laws and rates in the jurisdictions in which operations are conducted and income is earned. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Developing the provision (benefit) for income taxes requires significant judgment and expertise in federal, international and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Management’s judgments and tax strategies are subject to audit by various taxing authorities.

 

 F-11 

 

 

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense.

 

Stock options

 

For stock option grants to employees, the Company recognizes compensation expense based on the estimated fair value of the options at the date of grant. Stock-based employee compensation expense is recognized on a straight-line basis over the requisite service period. The Company issues previously unissued common shares upon the exercise of stock options.

 

For the fiscal years ended October 31, 2017 and 2016, charges related to stock-based compensation amounted to approximately $214,000 and $206,000, respectively. For the fiscal years ended October 31, 2017 and 2016, stock-based compensation classified in cost of sales amounted to $13,000 and $28,000 and stock-based compensation classified in selling and general and engineering expense amounted to $201,000 and $178,000, respectively.

 

Earnings (loss) per share

 

Basic earnings (loss) per share is calculated by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the period. The calculation of diluted earnings (loss) per share is similar to that of basic earnings (loss) per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all potentially dilutive common shares, principally those issuable upon the exercise of stock options, were issued and the treasury stock method had been applied during the period. The greatest number of shares potentially issuable by the Company upon the exercise of stock options in any period for the years ended October 31, 2017 and 2016, that were not included in the computation because they were anti-dilutive, totaled 737,512 and 824,441, respectively.

 

The following table summarizes the computation of basic and diluted earnings (loss) per share:

 

   2017   2016 
Numerators:          
Consolidated net income (loss) (A)  $382,000   $(4,089,000)
           
Denominators:          
Weighted average shares outstanding for basic earnings (loss) per share (B)   8,840,895    8,786,510 
Add effects of potentially dilutive securities - assumed exercise of stock options   74,869    - 
           
Weighted average shares outstanding for diluted earnings (loss) per share (C)   8,915,764    8,786,510 
           
Basic earnings (loss) per share (A)/(B)  $0.04   $(0.47)
           
Diluted earnings (loss) per share (A)/(C)  $0.04   $(0.47)

 

Recent accounting standards

 

Recently issued accounting pronouncements not yet adopted:

 

In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. The new standard will change the classification of certain cash payments and receipts within the cash flow statement. Specifically, payments for debt prepayment or debt extinguishment costs, including third-party costs, premiums paid, and other fees paid to lenders that are directly related to the debt prepayment or debt extinguishment, excluding accrued interest, will now be classified as financing activities. Previously, these payments were classified as operating expenses. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019, with early adoption permitted, and will be applied retrospectively. The Company does not expect that the adoption of this new standard will have a material impact on its Consolidated Financial Statements.  

 

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. This ASU requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The ASU also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.

 

 F-12 

 

 

In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation – Stock Compensation. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. The new standard is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements effective for the quarter ending January 31, 2018.

 

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. This guidance will supersede Topic 605, Revenue Recognition, in addition to other industry-specific guidance, once effective. The new standard requires a company to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services.  In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, as a revision to ASU 2014-09, which revised the effective date to fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted but not prior to periods beginning after December 15, 2016 (i.e., the original adoption date per ASU 2014-09). In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations, which clarifies certain aspects of the principal-versus-agent guidance, including how an entity should identify the unit of accounting for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments also reframe the indicators to focus on evidence that an entity is acting as a principal rather than as an agent. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property, which will determine whether it recognizes revenue over time or at a point in time. The amendments also clarify when a promised good or service is separately identifiable (i.e., distinct within the context of the contract) and allow entities to disregard items that are immaterial in the context of a contract. The Company continues to assess the impact this new standard may have on its ongoing financial reporting. The Company has identified its revenue streams both by contract and product type and is assessing each for potential impacts. For the revenue streams assessed, the Company does not anticipate a material impact in the timing or amount of revenue recognized.  

 

In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles-Goodwill and Other, which simplifies the accounting for goodwill impairments by eliminating step 2 from the goodwill impairment test. Instead, if “the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.” The guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.

 

Note 2 - Discontinued operations

 

During 2013, the Company sold its RF Neulink and RadioMobile divisions, which together had comprised the Company’s RF Wireless segment. The divisions were sold pursuant to asset purchase agreements, whereby no purchase price was paid at the closing. Rather, the agreements stipulated royalty payments from each of the purchasers over a three-year period. For the years ended October 31, 2017 and 2016, the Company recognized approximately $174,000 and $57,000, respectively, of aggregate royalty income for RF Neulink and RadioMobile, which amounts have been included within discontinued operations.

 

During March 2016, the Company announced the shutdown of its Bioconnect division, which comprised the entire operations of the Medical Cabling and Interconnect segment. The closure is part of the Company’s ongoing plan to close or dispose of underperforming divisions that are not part of the Company’s core operations. For the year ended October 31, 2017, the Company recognized approximately $10,000 of income related to the sale of equipment for the Bioconnect division, which amounts have been included within discontinued operations. For the year ended October 31, 2016, the Company recognized approximately $148,000 of loss for the Bioconnect division, which amounts have been included within discontinued operations. Included in the fiscal year 2016 loss, the Company recognized a $148,000 pretax write-down on Bioconnect division’s inventory and fixed assets.

 

The following summarized financial information related to the RF Neulink, RadioMobile and Bioconnect divisions is segregated from continuing operations and reported as discontinued operations for the years ended October 31, 2017 and 2016 (in thousands):

 

   2017   2016 
         
Royalties  $174   $57 
Bioconnect   10    (148)
Provision (benefit) for income taxes   68    (33)
Income (loss) from discontinued operations, net of tax  $116   $(58)

 

Note 3 - Concentrations of credit risk

 

Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At October 31, 2017, the Company had cash and cash equivalent balances in excess of federally insured limits in the amount of approximately $5.2 million.

 

 F-13 

 

 

Two customers accounted for approximately 20% and 11% of the Company’s net sales for the fiscal year ended October 31, 2017, and one customer accounted for approximately 15% of the Company’s net sales for the fiscal year ended October 31, 2016. At October 31, 2017 these customers’ accounts receivable balance accounted for approximately 27% and 5% of the Company’s total net accounts receivable balances, and at October 31, 2016, this customer’s accounts receivable balance accounted for approximately 20% of the Company’s total net accounts receivable balance.  Although these customers have been on-going major customers of the Company continuously in the past, the written agreements with these customers do not have any minimum purchase obligations and the customers could stop buying the Company’s products at any time and for any reason. A reduction, delay or cancellation of orders from these customers or the loss of these customers could significantly reduce the Company’s future revenues and profits.

 

There was no product line that was significant for the fiscal years ended October 31, 2017 and 2016.

 

Note 4 - Inventories and major vendors

 

Inventories, consisting of materials, labor and manufacturing overhead, are stated at the lower of cost or market. Cost has been determined using the weighted average cost method. In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech values its inventory cost using the weighted average cost of accounting. Inventories consist of the following (in thousands): 

 

   2017   2016 
         
Raw materials and supplies  $2,520   $2,642 
Work in process   194    279 
Finished goods   3,395    3,101 
           
Totals  $6,109   $6,022 

 

Purchases of inventory from two major vendors during fiscal 2017 represented 7% and 5%, respectively, of total inventory purchases compared to two major vendors who represented 9% and 6%, respectively, of total inventory purchases in fiscal 2016. The Company has arrangements with these vendors to purchase product based on purchase orders periodically issued by the Company.

 

Note 5 - Other current assets

 

Other current assets consist of the following (in thousands): 

 

   2017   2016 
         
Prepaid taxes  $20   $871 
Prepaid expense   526    347 
Notes receivable, current portion   83    83 
Other   115    135 
           
Totals  $744   $1,436 

 

Long-term portion of notes receivable of zero and $21,000 is recorded in other assets as of October 31, 2017 and 2016, respectively.

 

Note 6 - Accrued expenses and other long-term liabilities

 

Accrued expenses consist of the following (in thousands):

 

   2017   2016 
         
Wages payable  $855   $941 
Accrued receipts   695    578 
Earn-out liability   236    707 
Other current liabilities   456    544 
           
Totals  $2,242   $2,770 

 

Accrued receipts represent purchased inventory for which invoices have not been received.

 

The non-current portion of the earn-out liability of $128,000 is recorded in other long-term liabilities as of October 31, 2016

 

 F-14 

 

 

Note 7 - Segment information

   

The Company aggregates operating divisions into operating segments which have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; and (5) if applicable, the nature of the regulatory environment. As of October 31, 2017, the Company had two segments - RF Connector and Cable Assembly, and Custom Cabling Manufacturing based upon this evaluation.

 

The RF Connector and Cable Assembly segment is comprised of one division, while the Custom Cabling Manufacturing and Assembly segment comprised of three divisions. The four divisions that met the quantitative thresholds for segment reporting are Connector and Cable Assembly, Cables Unlimited, Comnet and Rel-Tech. The specific customers are different for each division; however, there is some overlapping of product sales to them. The methods used to distribute products are similar within each division aggregated.

 

Management identifies the Company’s segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the RF Connector and Cable Assembly division constitutes the RF Connector and Cable Assembly segment, and the Cables Unlimited, Comnet and Rel-Tech division constitute the Custom Cabling Manufacturing segment.

 

As reviewed by the Company’s chief operating decision maker, the Company evaluates the performance of each segment based on income or loss before income taxes. The Company charges depreciation and amortization directly to each division within the segment. Accounts receivable, inventory, property and equipment, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same for the Company as a whole.

 

Substantially all of the Company’s operations are conducted in the United States; however, the Company derives a portion of its revenue from export sales. The Company attributes sales to geographic areas based on the location of the customers. The following table presents the sales of the Company by geographic area for the years ended October 31, 2017 and 2016 (in thousands):

 

   2017   2016 
         
United States  $30,232   $29,257 
Foreign Countries:          
Canada   483    509 
Israel   -    63 
Mexico   78    234 
All Other   171    178 
    732    984 
           
Totals  $30,964   $30,241 

 

Net sales, income (loss) from continuing operations before provision (benefit) for income taxes and other related segment information for the years ended October 31, 2017 and 2016 are as follows (in thousands): 

 

   RF Connector   Custom Cabling         
   and   Manufacturing and         
  Cable Assembly   Assembly   Corporate   Total 
2017                    
Net sales  $11,456   $19,508   $-   $30,964 
Income (loss) from continuing operations before provision (benefit) for income taxes   382    (11)   29    400 
Depreciation and amortization   177    700    -    877 
Total assets   6,297    11,910    6,853    25,060 
                     
2016                    
Net sales  $9,352   $20,889   $-   $30,241 
Loss from continuing operations before provision (benefit) for income taxes   (1,358)   (3,232)   (93)   (4,683)
Depreciation and amortization   194    842    -    1,036 
Total assets   5,902    13,100    6,835    25,837 

 

 F-15 

 

 

Note 8 - Income tax provision

 

The provision (benefit) for income taxes for the fiscal years ended October 31, 2017 and 2016 consists of the following (in thousands):

 

   2017   2016 
Current:          
Federal  $400   $(332)
State   24    (13)
    424    (345)
           
Deferred:          
Federal   (293)   (179)
State   3    (128)
    (290)   (307)
           
   $134   $(652)

 

Income tax at the federal statutory rate is reconciled to the Company’s actual net provision (benefit) for income taxes as follows (in thousands, except percentages):

 

   2017   2016 
       % of Pretax       % of Pretax 
   Amount   Income   Amount   Income 
                 
Income taxes at federal statutory rate  $136    34.0%  $(1,592)   34.0%
State tax provision, net of federal tax benefit   16    4.0%   (53)   1.1%
Nondeductible differences:                    
Goodwill and other intangible asset impairment   -    0.0%   916    -19.6%
Rel-Tech earn-out   (9)   -2.3%   52    -1.1%
Qualified domestic production activities deduction   (66)   -16.5%   46    -1.0%
ISO stock options   33    8.3%   52    -1.1%
Meals and entertainment   21    5.3%   29    -0.6%
Temporary true-ups   26    6.4%   -    0.0%
State tax refunds, net of federal expense   (4)   -0.8%   (38)   0.8%
R&D credits   (37)   -9.3%   (46)   1.0%
Other   18    4.4%   (18)   0.4%
   $134    33.5%  $(652)   13.9%

 

 F-16 

 

 

The Company’s total deferred tax assets and deferred tax liabilities at October 31, 2017 and 2016 are as follows (in thousands):

 

   2017   2016 
         
Deferred Tax Assets:          
Reserves  $375   $216 
Accrued vacation   122    134 
Stock-based compensation awards   184    159 
Uniform capitalization   130    148 
Other   70    43 
Total deferred tax assets   881    700 
           
Deferred Tax Liabilities:          
Amortization / intangible assets   (805)   (864)
Depreciation / equipment and furnishings   (195)   (211)
Other   -    (34)
Total deferred tax liabilities   (1,000)   (1,109)
           
Total net deferred tax assets (liabilities)  $(119)  $(409)

 

Deferred income tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has evaluated the available evidence supporting the realization of its gross deferred tax assets, including the amount and timing of future taxable income, and has determined it is more likely than not that the assets will be realized in future tax years.

 

The Company had adopted the provisions of ASC 740-10, which clarifies the accounting for uncertain tax positions. ASC 740-10 requires that the Company recognize the impact of a tax position in the financial statements if the position is not more likely than not to be sustained upon examination based on the technical merits of the position. The Company’s practice is to recognize interest and penalties related to income tax matters in income from continuing operations. The Company has no material unrecognized tax benefits as of October 31, 2017.

 

The Company is subject to taxation in the United States and state jurisdictions. The Company’s tax years for October 31, 2014 and forward are subject to examination by the United States and October 31, 2013 and forward with state tax authorities.

 

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into United States tax law, which among other provisions will lower the corporate tax rate to 21%. Given this date of enactment, our consolidated financial statements as of and for the year ended October 31, 2017 do not reflect the impact of the Act. The Company is in the process of analyzing the potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the law was enacted.

 

Note 9 - Stock options

 

Incentive and non-qualified stock option plans

 

On March 9, 2010, the Company’s Board of Directors adopted the RF Industries, Ltd. 2010 Stock Incentive Plan (the “2010 Plan”). In June 2010, the Company’s stockholders approved the 2010 Plan by vote as required by NASDAQ. An aggregate of 1,000,000 shares of common stock was set aside and reserved for issuance under the 2010 Plan. The Company’s stockholders approved the issuance of an additional 500,000 shares of common stock at its annual meeting held on September 5, 2014, another 500,000 shares of common stock at its annual meeting held September 4, 2015 and another 1,000,000 shares of common stock at its annual meeting held September 8, 2017. As of October 31, 2017, 1,726,138 shares of common stock were remaining for future grants of stock options under the 2010 Plan.

 

Additional disclosures related to stock option plans 

 

The fair value of each option granted in 2017 and 2016 was estimated on the grant date using the Black-Scholes option pricing model with the following assumptions:

 

   2017   2016 
Weighted average volatility   43.3%   28.7%
Expected dividends   5.0%   2.4%
Expected term (in years)   4.3    3.0 
Risk-free interest rate   1.20%   0.70%
Weighted average fair value of options granted during the year  $0.39   $0.66 
Weighted average fair value of options vested during the year  $1.95   $4.36 

 

 F-17 

 

 

Expected volatilities are based on historical volatility of the Company’s stock price and other factors. The Company used the historical method to calculate the expected life of the 2017 option grants. The expected life represents the period of time that options granted are expected to be outstanding. The risk-free rate is based on the U.S. Treasury rate with a maturity date corresponding to the options’ expected life. The dividend yield is based upon the historical dividend yield.

 

Additional information regarding all of the Company's outstanding stock options at October 31, 2017 and 2016 and changes in outstanding stock options in 2017 and 2016 follows:

 

   2017   2016 
   Shares or   Weighted   Shares or   Weighted 
   Price Per   Average   Price Per   Average 
   Share   Exercise Price   Share   Exercise Price 
Options outstanding at beginning of year   1,007,851   $4.07    1,240,100   $3.64 
Options granted   449,068   $1.61    104,936   $3.36 
Options exercised   (36,763)  $1.50    (180,067)  $0.27 
Options forfeited   (260,385)  $4.10    (157,118)  $4.53 
Options outstanding at end of year   1,159,771   $3.19    1,007,851   $4.07 
                     
Options exercisable at end of year   926,272   $3.08    724,457   $3.93 
                     
Options vested and expected to vest at end of year   1,159,002   $3.19    1,002,522   $4.07 
                     
Option price range at end of year  $ 1.07 - $6.91         $ 2.30 - $6.91       
                     
Aggregate intrinsic value of options exercised during year  $55,000        $456,000      

 

Weighted average remaining contractual life of options outstanding as of October 31, 2017: 4.19 years

 

Weighted average remaining contractual life of options exercisable as of October 31, 2017: 3.18 years

 

Weighted average remaining contractual life of options vested and expected to vest as of October 31, 2017: 4.19 years

 

Aggregate intrinsic value of options outstanding at October 31, 2017: $552,000

 

Aggregate intrinsic value of options exercisable at October 31, 2017: $503,000

 

Aggregate intrinsic value of options vested and expected to vest at October 31, 2017: $552,000

 

As of October 31, 2017, $275,000 of expense with respect to nonvested share-based arrangements has yet to be recognized which is expected to be recognized over a weighted average period of 6.33 years.

 

Effective for the fiscal year ending October 31, 2017, non-employee directors receive $50,000 annually, which is paid one-half in cash and one-half through the grant of non-qualified stock options to purchase shares of the Company’s common stock. Previously, for the fiscal year ended October 31, 2016, non-employee directors received $30,000 annually. During the quarter ended January 31, 2017, the Company granted each of its four non-employee directors 77,339 options. The number of stock options granted to each director was determined by dividing $25,000 by the fair value of a stock option grant using the Black-Scholes model ($0.32 per share). These options vest ratably over fiscal year 2017. On June 9, 2017, the Company’s Board of Directors appointed Gerald Garland to serve as a director. Mr. Garland received a prorated portion of the compensation paid by the Company. The number of stock options granted to Mr. Garland was determined by dividing $9,863 (the portion of his director fee for the year ending October 31, 2017) by the fair value of a stock option grant using the Black-Scholes model ($0.40 per share). These options vest ratably over the remaining portion of fiscal year 2017.

 

On April 6, 2016, Howard Hill, the Company’s former Chief Operating Officer, retired from the Company. On becoming a non-employee member of the Board on April 7, 2016, Mr. Hill was granted 33,744 options, representing the director compensation payable to him for his services for the remainder of the 2016 fiscal year. The number of stock options granted was determined by dividing his pro-rata portion of his stock based compensation for serving on the Board of $8,750 by the fair value of a stock option grant using the Black-Scholes model ($0.26). These options vested ratably over fiscal 2016.

 

 F-18 

 

 

Note 10 - Retirement plan

 

The Company has a 401(K) plan available to its employees. For the years ended October 31, 2017 and 2016, the Company contributed and recognized as an expense $166,000 and $182,000, respectively, which amount represented 3% of eligible employee earnings under its Safe Harbor Non-elective Employer Contribution Plan.

 

 Note 11 - Related party transactions

 

During fiscal 2016 the Company had a note receivable from stockholder of $67,000 that was due from a former Chief Executive Officer of the Company, earned interest at 6% per annum (which interest was payable annually), and had no specific due date. The note was collateralized by property owned by the former Chief Executive Officer. During fiscal 2016, the former Chief Executive Officer resigned as an employee of the Company and, in connection with his resignation, repaid the foregoing promissory note in full.

 

On June 15, 2011, the Company purchased Cables Unlimited, Inc., a New York corporation, from Darren Clark, the sole shareholder of Cables Unlimited, Inc. In connection with the purchase of Cables Unlimited, the Company entered into a lease for the New York facilities from which Cables Unlimited conducts its operations. Cables Unlimited’s monthly rent expense under the lease is $13,000 per month, plus payments of all utilities, janitorial expenses, routine maintenance costs, and costs of insurance for Cables Unlimited’s business operations and equipment. During the fiscal year ended October 31, 2017, the Company paid the landlord a total of $156,000 under the lease. The owner and landlord of the facility is a company controlled by Darren Clark, the former owner of Cables Unlimited and the current President of this subsidiary of the Company.

 

Note 12 - Cash dividend and declared dividends

 

The Company paid quarterly dividends of $0.02 per share during fiscal year 2017 for a total of $707,000. The Company paid quarterly dividends of $0.02, $0.02, $0.02 and $0.07 per share during the three months ended October, 31, 2016, July 31, 2016, April 30, 2016 and January 31, 2016, respectively, for a total of $1.1 million.

 

Note 13 - Commitments

 

As of October 31, 2017, the Company leases its facilities in San Diego, California, Yaphank, New York, Milford, Connecticut and East Brunswick, New Jersey under non-cancelable operating leases. Deferred rents, included in accrued expenses and other long-term liabilities, were $95,000 as of October 31, 2017 and $3,000 as of October 31, 2016. The San Diego lease also requires the payment of the Company's pro rata share of the real estate taxes and insurance, maintenance and other operating expenses related to the facilities.

 

Rent expense under all operating leases totaled approximately $644,000 and $628,000 in 2017 and 2016, respectively.

 

Minimum lease payments under these non-cancelable operating leases in each of the years subsequent to October 31, 2017 are as follows (in thousands):

 

Year ending    
October 31,  Amount 
     
2018  $645 
2019   516 
2020   441 
2021   440 
2022   359 
Total  $2,401 

 

 Note 14 - Line of credit

 

From May 2015 until September 2016, the Company had a $5 million line of credit available to it from its bank. The Company did not use the line of credit and, effective September 8, 2016, the Company terminated the line of credit.

 

Note 15 - Subsequent events

 

On December 13, 2017, the Board of Directors of the Company declared a quarterly dividend of $0.02 per share that was paid on January 15, 2018 to stockholders of record on December 31, 2017.

 

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into United States tax law, which among other provisions will lower the corporate tax rate to 21%. Given this date of enactment, our financial statements for the year ended October 31, 2017 do not reflect the impact of the Act. The Company is in the process of analyzing the potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the law was enacted.

 

 F-19 

 

 

SIGNATURES

 

 In accordance with 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.

 

  RF INDUSTRIES, LTD.
   
Date: January 24, 2018 By: /s/ ROBERT D. DAWSON
  Robert D. Dawson
  President and Chief Executive Officer

 

In accordance with the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

 

Date: January 24, 2018 By: /s/ ROBERT D. DAWSON
  Robert D. Dawson,
  President and Chief Executive Officer
  (Principal Executive Officer)

 

Date: January 24, 2018 By: /s/ MARK TURFLER
  Mark Turfler, Chief Financial Officer
  (Principal Financial Officer and Principal Accounting Officer)
     
Date: January 24, 2018 By: /s/ MARVIN FINK
  Marvin Fink, Director
     
Date: January 24, 2018 By: /s/ WILLIAM REYNOLDS
  William Reynolds, Director
     
Date: January 24, 2018 By: /s/ JOSEPH BENOIT
  Joseph Benoit, Director
     
Date: January 24, 2018 By: /s/ HOWARD HILL
  Howard Hill, Director
     
Date: January 24, 2018 By: /s/ GERALD GARLAND
  Gerald Garland, Director

 

 30 

 

EX-10.15 2 tv483221_ex10-15.htm EXHIBIT 10.15

EXHIBIT 10.15

 

FOURTH AMENDMENT TO LEASE

 

THIS FOURTH AMENDMENT TO LEASE (this “Amendment”) is made this 26th day of January 2017, by and between ICON MIRAMAR OWNER POOL 2 WEST/NORTHEAST/MIDWEST, LLC, a Delaware limited liability company (“Landlord”), and rf industries, ltd., a Nevada corporation (“Tenant”).

 

WITNESSETH:

 

WHEREAS, Landlord (successor in interest to CWCA Miramar GL 74, L.L.C., formerly known as Walton CWCA Miramar GL 74, L.L.C.) and Tenant are parties to that certain Lease, dated as of January 8, 2009 (the “Original Lease”), and amended by that certain Second Amendment to Lease (sic), dated as of August 25, 2009 (the “Second Amendment”), as further amended by that certain Third Amendment to Lease, dated April 17, 2014 (the “Third Amendment”, and collectively with the Original Lease and the Second Amendment, the “Lease”), pursuant to which Landlord leases to Tenant certain premises containing approximately 19,968 rentable square feet consisting of (i) approximately 3,858 rentable square feet with a common address of 7620 Miramar Road, Suite 4300/4400, San Diego, California (“Suite 4300/4400”), (ii) approximately 2,321 rentable square feet with a common address of 7616 Miramar Road, Suite 5200, San Diego, California (“Suite 5200”) and (iii) approximately 13,789 rentable square feet with a common address of 7610 Miramar Road, Suite 6000/6002, San Diego, California (“Suite 6000/6002”, and collectively with Suite 4300/4400 and Suite 5200, all as more particularly described in the Lease, the “Current Premises”) in the project commonly known as Miramar Business Park.

 

WHEREAS, Tenant desires to surrender a portion of the Current Premises to Landlord containing approximately 2,321 rentable square feet, consisting of Suite 5200 as shown on Exhibit A hereto (the “Suite 5200 Reduction Premises") and that the Lease be appropriately amended, and Landlord is willing to amend the Lease and accept such surrender on the terms and conditions set forth herein.

 

WHEREAS, Tenant has requested that additional space containing approximately 1,940 rentable square feet described as 7620 Miramar Road, Suite 4200 San Diego, California as shown on Exhibit A hereto (the “Suite 4200 Expansion Premises”) be added to the Premises and that the Lease be appropriately amended and Landlord is willing to do the same on the terms and conditions set forth herein.

 

WHEREAS, The Term is currently scheduled to expire on March 31, 2017, and Tenant desires to extend the Term for an additional sixty-four (64) full calendar months from such expiration.

 

WHEREAS, Landlord has agreed to the requested changes set forth in the preceding recitals, subject to the entry into this Amendment and the modification of the Lease terms and conditions as set forth herein.

  

AGREEMENT:

 

NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties, the parties hereto agree as follows:

 

1.                   Extension of Term. The Term is hereby extended for a period of sixty-four (64) full calendar months, commencing as of April 1, 2017 (the “Second Extension Date”) and expiring on July 31, 2022 (the “Second Extended Termination Date”) (which period is referred to herein as the “Second Extended Term”), unless sooner terminated in accordance with the terms of the Lease. From and after the date hereof, the “Term” shall be deemed to include the Second Extended Term. Tenant’s lease of the Premises during the Second Extended Term shall be subject to all the terms and conditions of the Lease, except as expressly modified herein, and except that Tenant shall not be entitled to receive any allowances, abatements, or other financial concession granted in connection with entering into the Lease unless such concessions are expressly provided for herein with respect to the Second Extended Term.

 

 

 

 

2.                   Suite 4200 Expansion Premises.

 

(a)                 Effective from and after the Suite 4200 Expansion Premises Commencement Date (defined below), the “Premises” as defined in the Lease shall be deemed to include both (i) the approximately 17,647 rentable square feet consisting of Suite 4300/4400 and Suite 6000/6002, as shown on Exhibit A, (the “Remaining Premises”) and (ii) the Suite 4200 Expansion Premises, but shall exclude the Suite 5200 Reduction Premises as more particularly described in Section 3 below), and all of the terms and conditions of the Lease with respect to the Premises, including the Second Extended Termination Date, shall be deemed to apply to both the Remaining Premises and the Suite 4200 Expansion Premises in all respects, except as otherwise set forth herein and except that Tenant shall not be entitled to receive with respect to the Suite 4200 Expansion Premises any allowances, abatements, or other financial concession granted in connection with entering into the Lease unless such concessions are expressly provided for herein with respect to the Suite 4200 Expansion Premises. Landlord and Tenant hereby agree and stipulate that the Suite 4200 Expansion Premises shall be deemed to contain approximately the rentable square footage set forth in the second recital above for all purposes under the Lease.

 

(b)                As used herein the “Suite 4200 Expansion Premises Commencement Date” means the later to occur of (i) April 1, 2017 (the “Scheduled Suite 4200 Expansion Premises Commencement Date”) and (ii) the date upon which Landlord delivers the Suite 4200 Expansion Premises to Tenant. Tenant agrees that in the event that Landlord fails to deliver the Suite 4200 Expansion Premises to Tenant on the Scheduled Suite 4200 Expansion Premises Commencement Date, it shall not be a default and Landlord shall not be liable for any damages or loss resulting therefrom, but the Suite 4200 Expansion Premises Commencement Date shall not occur and no rent applicable to the Suite 4200 Expansion Premises shall be payable until such time as Landlord delivers possession of the Suite 4200 Expansion Premises to Tenant. If the Suite 4200 Expansion Premises Commencement Date is delayed the Second Extended Termination Date shall not be similarly extended.

 

(c)                 On or prior to the Suite 4200 Expansion Premises Commencement Date, Tenant shall deliver revised insurance certificates covering the Suite 4200 Expansion Premises as required pursuant to Section 10 of the Original Lease.

 

(d)                Tenant shall have the right to enter the Suite 4200 Expansion Premises prior to the Suite 4200 Expansion Premises Commencement Date in accordance with the terms of Addendum 1 attached hereto.

 

3.                   Remaining Premises and Surrender of the Suite 5200 Reduction Premises.

 

(a)                 Remaining Premises. Effective solely for the period from and after the Suite 4200 Expansion Premises Commencement Date (estimated to be April 1, 2017) (the “Suite 5200 Reduction Effective Date”), the “Premises” as defined in the Lease shall be deemed to be only the Remaining Premises and the Suite 4200 Expansion Premises, and all of the terms and conditions of the Lease with respect to the Premises shall be deemed to apply solely to the Remaining Premises and the Suite 4200 Expansion Premises in all respects, except as otherwise set forth herein. After giving effect to the expansion described in Section 2 and the reduction described in this Section 3, the Premises shall be deemed to have approximately 19,587 rentable square feet, consisting of the Suite 4200 Expansion Premises, Suite 4300/4400 and Suite 6000/6002.

 

(b)                Surrender of Suite 5200 Reduction Premises.

 

(i)                        After the day immediately prior to the Suite 4200 Expansion Premises Commencement Date (estimated to be March 31, 2017) (the “Suite 5200 Reduction Premises Termination Date”), any and all rights and obligations of Tenant, and obligations of Landlord, with respect to the Suite 5200 Reduction Premises, including, without limitation, Tenant’s right to possession of the Suite 5200 Reduction Premises, shall be terminated; provided, however, that such termination shall under no circumstances or in any way constitute a waiver or termination of the obligations of Tenant which exist or have accrued up to and including the Suite 5200 Reduction Premises Termination Date and which may accrue or continue to accrue after the Suite 5200 Reduction Premises Termination Date to the extent Tenant has failed to satisfy all of its obligations with respect to the Suite 5200 Reduction Premises. In the event Tenant fails to surrender the Suite 5200 Reduction Premises to Landlord on or prior to the Suite 5200 Reduction Premises Termination Date in accordance with the terms hereof, then the terms and conditions of Section 13 (Holding Over) of the Original Lease shall apply in all respects with respect to the Suite 5200 Reduction Premises without in any way affecting the obligations of Tenant with respect to the Remaining Premises, including the obligation to pay rent in accordance with the terms herein.

 

 

 

 

(ii)                        Tenant acknowledges and agrees that, on or prior to the Suite 5200 Reduction Premises Termination Date, Tenant shall surrender the Suite 5200 Reduction Premises to Landlord in accordance with the terms of Section 21 (Surrender of Premises) of the Original Lease.

 

(iii)                        In furtherance of the foregoing, Landlord and Tenant shall perform walkthroughs of the Suite 5200 Reduction Premises, as contemplated by the Lease, for purposes of inspecting the Suite 5200 Reduction Premises for any damages which are Tenant’s responsibility to repair, at Tenant’s sole cost and expense, in accordance with the terms of the Lease and this Amendment. Landlord requires that such damage shall be cured by Tenant prior to the Suite 5200 Reduction Premises Termination Date and any such failure to cure such damage or surrender the Suite 5200 Reduction Premises in accordance with the terms of the Lease shall be an Event of Default under the Lease not subject to cure and Landlord shall be entitled to exercise any and all rights thereunder or at law.

 

4.                   Monthly Installment of Rent Schedule. Notwithstanding anything to the contrary set forth herein, effective as of the Suite 4200 Expansion Premises Commencement Date, the Monthly Installment of Rent for the Remaining Premises and the Suite 4200 Expansion Premises payable by Tenant to Landlord during the Second Extended Term is as follows:

 

From: To:

 

Monthly Installment of Rent

 

4/1/2017 3/31/2018       $22,720.92***
4/1/2018 3/31/2019 $23,402.55
4/1/2019 3/31/2020 $24,104.62
4/1/2020 3/31/2021 $24,827.76
4/1/2021 3/31/2022 $25,572.60
4/1/2022 7/31/2022 $26,339.77

 

***Tenant’s obligation to pay Monthly Installment of Rent shall be conditionally abated during the second (2nd), third (3rd), fourth (4th) and fifth (5th) full calendar months following the Suite 4200 Expansion Premises Commencement Date (the “Monthly Installment of Rent Abatement Period”). Such abatement shall apply to Monthly Installment of Rent only and shall not apply to any other sums payable under the Lease. The abatement of Monthly Installment of Rent described above is expressly conditioned on Tenant’s performance of its obligations under the Lease throughout the Term. If Tenant defaults (beyond any applicable notice and cure or grace period) under the Lease, then Tenant shall immediately, on demand, pay to Landlord, in addition to all other amounts and damages to which Landlord is entitled, the amount of Monthly Installment of Rent which would otherwise have been due and payable during the Monthly Installment of Rent Abatement Period.

 

Except as otherwise set forth in this Amendment, all other terms and conditions with respect to the payment of Monthly Installment of Rent shall remain as set forth in the Lease. Landlord and Tenant acknowledge that the schedule set forth above is based upon the assumption that the Scheduled Suite 4200 Expansion Premises Commencement Date is the actual Suite 4200 Expansion Premises Commencement Date. If that is not the case, the schedule set forth above shall be appropriately adjusted on a per diem basis to reflect the actual Suite 4200 Expansion Premises Commencement Date and Landlord shall prepare a memorandum reflecting the same, which Tenant shall execute within ten (10) days of receipt. In the event that the Suite 4200 Expansion Premises Commencement Date has not occurred by the Scheduled Suite 4200 Expansion Premises Commencement Date, Tenant shall pay Rent for the Current Premises at the rate(s) in effect as provided above for the period between Scheduled Suite 4200 Expansion Premises Commencement Date and the actual Suite 4200 Expansion Premises Commencement Date, prorated on a daily basis. Rent for any period during the Term which is less than a full month shall be a prorated portion of the Monthly Installment of Rent based upon the number of days in such month.

 

5.                   Tenant’s Proportionate Share for the Suite 4200 Expansion Premises and Remaining Premises. Tenant’s Proportionate Share collectively applicable to the Suite 4200 Expansion Premises and the Remaining Premises is 22.53%.

 

 

 

 

6.                   Security Deposit. Upon Tenant’s execution hereof, Tenant shall pay Landlord the sum of $8,854.53, which is added to and becomes a part of the Security Deposit, if any, held by Landlord as provided under the Lease as security for payment of rent and the performance of the other terms and conditions of the Lease by Tenant. Accordingly, simultaneously with the execution hereof, the Security Deposit is increased from $17,485.24 to $26,339.77.

 

7.                   Condition of the Premises.

 

(a)                  AS-IS Condition. Tenant hereby acknowledges and agrees that it has accepted the Remaining Premises as of the date hereof, and will accept (a) the Remaining Premises as of the Second Extension Date, and (b) Suite 4200 Expansion Premises as of the Suite 4200 Expansion Premises Commencement Date, in AS-IS, WHERE-IS condition without any representation or warranty of any kind made by Landlord in favor of Tenant.

 

(b)                  Tenant’s Work. Notwithstanding the foregoing subsection (a), Tenant may complete the work set forth on Exhibit B attached hereto in accordance with the terms and conditions set forth on such exhibit.

 

8.                   Termination of Container Storage Area Limited License. Tenant’s Limited License to use the Container Storage Area as provided in Section 6 of the Third Amendment is, effective as of the date hereof, hereby terminated with the same effect as if such date were the scheduled expiration date of the Limited License.

 

9.                   Assignment and Subletting. The first sentence of Section 8.1 of the Original Lease is hereby deleted in its entirety and the following substituted therefor:

 

“Tenant shall not have the right to assign or pledge this Lease or to sublet the whole or any part of the Premises whether voluntarily or by operation of law, or permit the use or occupancy of the Premises by anyone other than Tenant, and shall not make, suffer or permit such assignment, subleasing or occupancy without the prior written consent of Landlord, not to be unreasonably withheld, conditioned or delayed, and said restrictions shall be binding upon any and all assignees of the Lease and subtenants of the Premises.”

 

10.                Deleted Provision. Addendum 1 to the Third Amendment is hereby deemed null and void and of no further force and effect.

 

11.                OFAC. Tenant hereby represents and warrants that, to the best of its knowledge, neither Tenant, nor any persons or entities holding any legal or beneficial interest whatsoever in Tenant, are (i) the target of any sanctions program that is established by Executive Order of the President or published by the Office of Foreign Assets Control, U.S. Department of the Treasury (“OFAC”); (ii) designated by the President or OFAC pursuant to the Trading with the Enemy Act, 50 U.S.C. App. § 5, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701-06, the Patriot Act, Public Law 107-56, Executive Order 13224 (September 23, 2001) or any Executive Order of the President issued pursuant to such statutes; or (iii) named on the following list that is published by OFAC: “List of Specially Designated Nationals and Blocked Persons.” If the foregoing representation is untrue at any time during the Term, an Event of Default will be deemed to have occurred, without the necessity of notice to the defaulting party.

 

12.                Tenant’s Broker. Tenant represents and warrants that it has dealt with no broker, agent or other person in connection with this transaction, other than Hughes Marino, Inc. Tenant agrees to indemnify and hold Landlord and the Landlord Entities harmless from and against any claims by any other broker, agent or other person claiming a commission or other form of compensation by virtue of having dealt with Tenant with regard to this leasing transaction.

 

13.                No Offer. Submission of this Amendment by Landlord is not an offer to enter into this Amendment, but rather is a solicitation for such an offer by Tenant. Landlord shall not be bound by this Amendment until Landlord and Tenant have fully executed and delivered this Amendment.

 

 

 

 

14.                Authority. Tenant represents and warrants to Landlord that if Tenant is not a natural person, Tenant has been and is qualified to do business in the state in which the Premises is located, Tenant has full right and authority to enter into this Amendment, and that all persons signing on behalf of Tenant were authorized to do so by appropriate actions.

 

15.                Severability. If any clause or provision of this Amendment is illegal, invalid or unenforceable under present or future laws, then and in that event, it is the intention of the parties hereto that the remainder of this Amendment shall not be affected thereby. It is also the intention of the parties to this Amendment that in lieu of each clause or provision of this Amendment that is illegal, invalid or unenforceable, there be added, as a part of this Amendment, a clause or provision as similar in terms to such illegal, invalid or unenforceable clause or provision as may be possible and be legal, valid and enforceable.

 

16.                Counterparts and Delivery. This Amendment may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of such counterparts shall constitute one Amendment. Execution copies of this Amendment may be delivered by facsimile or email, and the parties hereto agree to accept and be bound by facsimile signatures or scanned signatures transmitted via email hereto, which signatures shall be considered as original signatures with the transmitted Amendment having the binding effect as an original signature on an original document. Notwithstanding the foregoing, Tenant shall, upon Landlord’s request, deliver original copies of this Amendment to Landlord at the address set forth in such request. Neither party may raise the use of a facsimile machine or scanned document or the fact that any signature was transmitted through the use of a facsimile machine or email as a defense to the enforcement of this Amendment.

 

17.                Conflict; Ratification; Integration. Insofar as the specific terms and provisions of this Amendment purport to amend or modify or are in conflict with the specific terms, provisions and exhibits of the Lease, the terms and provisions of this Amendment shall govern and control. Landlord and Tenant hereby agree that (a) this Amendment is incorporated into and made a part of the Lease, (b) any and all references to the Lease hereinafter shall include this Amendment, and (c) the Lease, and all terms, conditions and provisions of the Lease, are in full force and effect as of the date hereof, except as expressly modified and amended hereinabove. The recitals set forth herein are incorporated by reference. Capitalized terms used in this Amendment shall have the same definitions as set forth in the Lease to the extent that such capitalized terms are defined therein and not redefined in this Amendment. This Amendment and any attached exhibits and addenda set forth the entire agreement between the parties with respect to the matters set forth herein.

 

[Signature Page Follows]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly authorized, executed and delivered as of the day and year first set forth above. 

 

LANDLORD:     TENANT:  
             
ICON MIRAMAR OWNER POOL 2   rf industries, ltd., a Nevada corporation
WEST/NORTHEAST/MIDWEST, LLC,        
a Delaware limited liability company        
         
By: GLP US Management LLC,     By: /s/ Mark Turfler  
  a Delaware limited liability company          
  as agent for Landlord     Name: Mark Turfler  
             
        Title: Chief Financial Officer  
By: /s/ Robert Munson          
        Dated: January 18, 2017  
Name: Robert Munson          
             
Title: Senior Vice President          
             
Dated: January 26, 2017          

 

 

 

 

ADDENDUM 1

 

EARLY ACCESS TO SUITE 4200 EXPANSION PREMISES

 

Tenant shall have the right to enter the Suite 4200 Expansion Premises (“Early Access”) during the period commencing upon the latest to occur of (i) the date of full execution and delivery of the Amendment, (ii) March 17, 2017, (iii) delivery to Landlord of the sum, if any, required by Paragraph 7 (Security Deposit) of the Amendment, and (iv) delivery to Landlord of the certificates of insurance with respect to the Suite 4200 Expansion Premises as required by Section 10 (Insurance) of the Original Lease, and continuing through the day immediately prior to the Suite 4200 Expansion Premises Commencement Date (“Early Access Period”) for the purpose of installing racking systems and low-voltage internet technology equipment, storage of inventory and preparation of the space for the Tenant’s operations, subject to the following terms and conditions:

 

1.Tenant’s Early Access shall not constitute occupancy for operation of Tenant’s business and shall not trigger the Suite 4200 Expansion Premises Commencement Date.

 

2.Tenant’s Early Access shall be at Tenant’s sole risk and Landlord shall have no liability whatsoever in connection with Tenant’s Early Access.

 

3.Tenant and its employees, agents and contractors shall comply with Section 5 (Alterations) of the Original Lease and all governmental laws, ordinances and regulations during the Early Access Period, including obtaining any approvals, permits, or other authorizations required to perform its work within, and operate at, the Suite 4200 Expansion Premises during the Early Access Period.

 

4.Tenant shall comply with and be bound by all provisions of the Lease during the Early Access Period, including the obligation to pay all utilities, but excluding the obligation for payment of Monthly Installment of Rent, Expenses and Taxes.

 

5.Tenant shall not interfere with Landlord or Landlord’s contractors completing any work within the Suite 4200 Expansion Premises, and any such interference shall constitute a tenant delay.

 

6.Tenant shall indemnify, protect, defend and save Landlord, the Landlord Entities, and the Suite 4200 Expansion Premises harmless from and against any and all liens, liabilities, losses, damages, costs, expenses, demands, actions, causes of action and claims (including, without limitation, attorneys' fees and legal costs) arising out of the Early Access, use, construction, or occupancy of the Suite 4200 Expansion Premises by Tenant or its agents, employees, contractors, customers, guests, or invitees.

 

[Remainder of Page Intentionally Left Blank]

 

 

 

 

ADDENDUM 2

 

RENEWAL OPTION

 

1.                   Renewal Option. Notwithstanding anything to the contrary set forth in the Lease, Tenant shall have one (1) option to extend the Term (the “Renewal Option”) on the following terms and conditions:

 

(a)       Provided that as of the date of the receipt of the Renewal Notice (as hereinafter defined) by Landlord and the Renewal Commencement Date (as hereinafter defined), (i) Tenant is the tenant originally named herein, (ii) Tenant actually occupies all of the Remaining Premises and Suite 4200 Expansion Premises demised under the Amendment and any space added to the Premises, and (iii) no default exists, or would exist but for the passage of time or the giving of notice, or both, then Tenant shall have the right to extend the Term for an additional period of sixty (60) full calendar months (the “Renewal Term”) commencing on the day following the expiration of the Second Extended Term (the “Renewal Commencement Date”). Tenant shall give Landlord written notice (the “Renewal Notice”) of its election to extend the Term in accordance with the terms hereof at least nine (9) months, but not more than twelve (12) months, prior to the Second Extended Termination Date.

 

(b)       The Monthly Installment of Rent payable by Tenant to Landlord during the Renewal Term shall be the greater of (i) one hundred three percent (103%) of the Monthly Installment of Rent applicable to the last month of the Second Extended Term, and (ii) the then-prevailing market rate for comparable space in comparable buildings in the vicinity of the Project taking into account the size of the lease, the length of the renewal term, market escalations, and the credit of Tenant. The Monthly Installment of Rent shall not be reduced by reason of any costs or expenses saved by Landlord by reason of Landlord's not having to find a new tenant for such premises (including, without limitation, brokerage commissions, costs of improvements, rent concessions or lost rental income during any vacancy period).

 

(c)       Landlord shall notify Tenant of its determination of the Monthly Installment of Rent for the Renewal Term, and Tenant shall advise Landlord in writing of any objection to such determination of the Monthly Installment of Rent within fifteen (15) days of receipt of Landlord's notice. Failure to respond within the fifteen (15) day period shall constitute Tenant's rejection of such Monthly Installment of Rent, Tenant’s exercise of the Renewal Option shall be deemed to be withdrawn, and the Lease shall expire or terminate in accordance with its terms. If Tenant affirmatively objects in writing, Landlord and Tenant shall commence negotiations to attempt to agree upon the Monthly Installment of Rent for a period of up to fifteen (15) days after Landlord's receipt of Tenant's objection notice. If (i) Tenant has rejected such Monthly Installment of Rent in writing and (ii) the parties cannot agree after Tenant objects, each acting in good faith but without any obligation to agree, on the Monthly Installment of Rent on or before the end of such fifteen (15) day period, then Tenant's exercise of the Renewal Option shall be deemed withdrawn and the Lease shall expire or terminate in accordance with its terms unless Tenant or Landlord invokes the arbitration procedure provided below to determine the Monthly Installment of Rent for the Renewal Term.

 

Either party may elect to arbitrate the determination of the Monthly Installment of Rent for the Renewal Term by sending written notice to the other party and the regional office of the American Arbitration Association in which the Premises is located within three (3) business days after the expiration of the fifteen (15) day negotiation period provided in the preceding paragraph, invoking the binding arbitration provisions of this subsection. The arbitration to determine the Monthly Installment of Rent for the Renewal Term shall be in accordance with the Real Estate Industry Arbitration Rules and Mediation Procedures of the American Arbitration Association. Unless otherwise required by state law, arbitration shall be conducted in the metropolitan area where the Premises is located by a single arbitrator mutually selected by the parties and unaffiliated with either party. Landlord and Tenant shall each submit to the arbitrator their respective proposal of the appropriate Monthly Installment of Rent for the Renewal Term. The arbitrator must choose between the Landlord’s proposal and the Tenant’s proposal and may not compromise between the two or select some other amount. The cost of the arbitration shall be borne equally between the parties. If the arbitrator has not determined the Monthly Installment of Rent by the end of the Second Extended Term, Tenant shall pay one hundred five percent (105%) of the Monthly Installment of Rent in effect under the Lease as of the end of the Second Extended Term for the Renewal Term until the Monthly Installment of Rent is determined as provided herein. Upon such determination, Landlord and Tenant shall make the appropriate adjustments to the payments between them, including the reimbursement of any credit that may be due for the Monthly Installment of Rent actually paid by Tenant which is higher than the final Monthly Installment of Rent for the Renewal Term determined in accordance with the procedures set forth herein for such period. For the avoidance of doubt, the parties consent to the jurisdiction of any appropriate court to enforce the arbitration provisions of this subsection and to enter judgment upon the decision of the arbitrator.

 

 

 

 

(d)       The determination of the Monthly Installment of Rent does not reduce the Tenant's obligation to pay or reimburse Landlord for any additional rent and any other reimbursable or chargeable items as set forth in the Lease, and Tenant shall reimburse and pay Landlord as set forth in the Lease with respect to such items with respect to the Premises during the Renewal Term.

 

(e)       Except for the Monthly Installment of Rent for the Renewal Term as determined above, Tenant's occupancy of the Premises during the Renewal Term shall be on the same terms and conditions as are in effect immediately prior to the expiration of the Term; provided, however, Tenant shall have no further right to any allowances, credits or abatements or any options to expand, contract, renew, terminate or extend the Lease.

 

(f)       If Tenant does not give the Renewal Notice within the period set forth above, the Renewal Option shall automatically terminate. Time is of the essence as to the giving of the Renewal Notice.

 

(g)       Landlord shall have no obligation to refurbish or otherwise improve the Premises for the Renewal Term. The Premises shall be tendered on the Renewal Commencement Date in “as-is” condition.

 

(h)       If the Lease is extended for the Renewal Term, then, promptly after the determination of Monthly Installment of Rent in accordance with the terms of this Addendum, Landlord shall prepare and Tenant shall execute, within fifteen (15) days of receipt, an amendment to the Lease confirming the extension of the Term and the other provisions applicable thereto.

 

(i)       If Tenant exercises its right to extend the term of the Lease for the Renewal Term pursuant to this Addendum and the parties execute the amendment, the term “Term” as used in this Lease, shall be construed to include, when practicable, the Renewal Term except as provided in subsection (e) above.

 

 

 

 

EXHIBIT A

 

DEPICTION OF SUITE 5200 REDUCTION PREMISES,

REMAINING PREMISES AND SUITE 4200 EXPANSION PREMISES

 

 

 

 

 

 

 

EXHIBIT B

 

WORK LETTER

 

 

(a)                 AS-IS Condition. Tenant shall lease the Remaining Premises and Suite 4200 Expansion Premises from Landlord on an “AS-IS” basis, without any representation or warranty of any kind made by Landlord in favor of Tenant and without change or modification thereto of any kind other than the work described in this exhibit. However, Landlord shall be responsible for causing, as of the Suite 4200 Expansion Premises Commencement Date, the existing HVAC system, and material electrical, plumbing and other mechanical systems that exclusively service the Suite 4200 Expansion Premises to be in good working order, provided that the foregoing shall not imply any representation or warranty as to the useful life of such systems, nor shall the foregoing diminish Tenant’s responsibility to perform any repairs, modifications or improvements to the same necessitated after the date that the Suite 4200 Expansion Premises is delivered to Tenant, whether by reason of Tenant’s use of the same, Tenant’s alterations, ordinary wear and tear, or otherwise.

 

(b)                Tenant’s Work. Notwithstanding the foregoing subsection (a), Landlord shall contribute up to a maximum amount of $34,277.25 (the “Allowance”) towards Tenant’s real property alterations and real property improvements to the Remaining Premises and Suite 4200 Expansion Premises that Tenant may elect from those specified below (collectively, the “Tenant’s Work”):

 

1.Remove the existing demising wall located between the Suite 4200 Expansion Premises and Suite 4300/4400.
2.Paint interior walls of the Premises.
3.Install new carpet within the Premises.
4.Install an additional HVAC unit serving the Suite 4200 Expansion Premises.
5.Construct new interior offices in the Remaining Premises.
6.Any other real property improvement work to the Suite 4200 Expansion Premises and/or the Remaining Premises that Landlord approves, in its sole and absolute discretion and in writing, for reimbursement to Tenant from the Allowance in accordance with subparagraph (c) below; provided that, in all events, such real property improvement work will become permanently affixed to the Premises, directly benefit the Building and be completed in accordance with final plans and specifications approved by Landlord in accordance with the terms of the Lease.

 

(c)                 Landlord’s Approval; Tenant’s Obligations. The Tenant’s Work shall be deemed Alterations and shall be subject to the terms of Section 5 of the Original of the Lease, except that Landlord shall not require a surety company performance bond or funded construction escrow. In addition to obtaining Landlord’s consent as and when required pursuant to Section 5 of the Original Lease, Tenant shall obtain Landlord’s prior written consent for any of the Tenant’s Work for which Tenant will seek reimbursement from the Allowance. In all cases, Tenant shall deliver plans and specifications for Tenant’s Work, and any other documentation reasonably requested by Landlord, to Landlord for approval prior to commencing any of Tenant’s Work. Tenant’s Work shall be constructed in a good and workmanlike manner and in compliance with all laws, ordinances and regulations, and Tenant shall perform, at its expense, any alteration or modification required by laws, ordinances and regulations as a result of Tenant’s Work. Landlord may monitor the construction of Tenant’s Work, subject to the obligation to provide prior notice to Tenant of any entry onto the Remaining Premises and the Suite 4200 Expansion Premises (except in the case of emergency, in which case no prior notice is required). In the event the scope of work requested by Tenant is such that Landlord elects to engage a third-party architect, engineer, or other similar consultant or professional to review such proposed work, Tenant shall reimburse Landlord for its actual, reasonable out-of-pocket costs in reviewing plans and specifications and in monitoring the construction for compliance with such approved plans and specifications. Landlord’s right to approve Tenant’s Work and to monitor construction shall be solely for its own benefit, and Landlord shall have no duty to see that Tenant’s Work complies with laws, ordinances and regulations. In addition, if Landlord manages Tenant’s construction Landlord may collect a construction management fee in the amount of five percent 5% of the cost of the Tenant’s Work as described herein and any additional work requested by Tenant and agreed to by Landlord, and such fee shall be paid, in part or in whole, from the Allowance with any amount not covered by the Allowance to be paid by Tenant directly to Landlord (or, at Landlord’s election, to Landlord’s property manager).

 

 

 

 

(d)                Allowance. The Allowance may be used only for the hard costs and Eligible Soft Costs (as hereinafter defined) of construction of Tenant’s Work pursuant to the approved plans and specifications. “Eligible Soft Costs” shall be deemed to be costs and expenses incurred by Tenant which are directly and primarily related to Tenant’s Work and which relate solely to the work of any architect, space planner, engineer, or similar construction professional or which are direct payments made to applicable authorities for permitting and license fees; provided, however, that in no event shall the Eligible Soft Costs exceed fifteen percent (15%) of the total Allowance or be used for services provided in connection with the negotiation of the Lease. For the avoidance of doubt, Eligible Soft Costs shall expressly exclude any financing costs, attorneys’ fees, or other costs and expenses not expressly permitted hereunder. In no event will the Allowance be used to pay for moving or storage expenses or furniture, racking, equipment, cabling, telephone systems or any other item of personal property which is not intended to be permanently affixed to the Remaining Premises and Suite 4200 Expansion Premises. Payment of the Allowance shall be made by Landlord to Tenant within thirty (30) days following the last to occur of: (i) completion of Tenant’s Work, (ii) Landlord’s receipt of Tenant’s invoice substantiating the costs related thereto, (iii) Landlord’s receipt of final lien waivers from all contractors and subcontractors who performed Tenant’s Work, and (iv) Landlord’s receipt of a copy of the final permit approved by the applicable governing authority for any work which requires the same. Landlord shall be under no obligation to pay for any of Tenant’s Work in excess of the Allowance. Further, the Allowance shall only be available for Tenant’s use for work performed and submitted to Landlord for reimbursement in accordance with the terms of this subsection (d) on or before December 31, 2017 at which time Tenant hereby waives any and all rights to any unused portion of the Allowance.

 

 

EX-21.1 3 tv483221_ex21-1.htm EXHIBIT 21.1

 

Exhibit 21.1

 

Subsidiaries

 

RF Industries, Ltd. owns 100% of the capital stock of each of the following subsidiaries:

 

·Cables Unlimited, Inc., a New York corporation
·Rel-Tech Electronics, Inc., a Connecticut corporation
·Comnet Telecom Supply Inc., a New York corporation

 

 

 

EX-23.1 4 tv483221_ex23-1.htm EXHIBIT 23.1

 

Exhibit 23.1

 

Consent of Independent Registered Public Accounting Firm

 

We consent to the incorporation by reference in the registration statements on Form S-8 (Nos. 333-207569, 333-114932, 333-169490, 333-205748 and 333-220561) of RF Industries, Ltd., of our report dated January 24, 2018 on our audits of the consolidated financial statements of RF Industries, Ltd. and Subsidiaries as of October 31, 2017 and 2016 and for the years then ended, included in this Annual Report on Form 10-K of RF Industries, Ltd. for the year ended October 31, 2017.

 

/s/ CohnReznick LLP  
   
San Diego, California  
January 24, 2018  

 

 

 

EX-31.1 5 tv483221_ex31-1.htm EXHIBIT 31.1

 

 Exhibit 31.1

 

 CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

 

I, Robert D. Dawson, certify that:

 

1. I have reviewed this report on Form 10-K for the fiscal year ended October 31, 2017 of RF Industries, Ltd.;

 

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period for which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and to the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: January 24, 2018   /s/ Robert D. Dawson
  Robert D. Dawson
  President and Chief Executive Officer

 

 

 

EX-31.2 6 tv483221_ex31-2.htm EXHIBIT 31.2

 

Exhibit 31.2

 

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

 

I, Mark Turfler, certify that:

 

1. I have reviewed this report on Form 10-K for the fiscal year ended October 31, 2017 of RF Industries, Ltd.;

 

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period for which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and to the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

  

Date: January 24, 2018   /s/ Mark Turfler      
  Mark Turfler
  Chief Financial Officer

 

 

 

EX-32.1 7 tv483221_ex32-1.htm EXHIBIT 32.1

 

Exhibit 32.1

 

CERTIFICATION PURSUANT TO

 

18 U.S.C. § 1350,

 

AS ADOPTED PURSUANT TO

 

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report of RF Industries, Ltd. (the “Company”) on Form 10-K for the fiscal year ended October 31, 2017, as filed with the Securities and Exchange Commission (the “Report”), I, Robert D. Dawson, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

 

  (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

  (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: January 24, 2018   /s/ Robert D. Dawson
  Robert D. Dawson
  President and Chief Executive Officer

 

 

 

EX-32.2 8 tv483221_ex32-2.htm EXHIBIT 32.2

 

Exhibit 32.2

 

CERTIFICATION PURSUANT TO

 

18 U.S.C. § 1350,

 

AS ADOPTED PURSUANT TO

 

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report of RF Industries, Ltd. (the “Company”) on Form 10-K for the fiscal year ended October 31, 2017, as filed with the Securities and Exchange Commission (the “Report”), I, Mark Turfler, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

 

  (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

  (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: January 24, 2018   /s/ Mark Turfler
  Mark Turfler
  Chief Financial Officer

 

 

 

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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Numerators:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Consolidated net income (loss) (A)</td><td width="1%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Denominators:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Weighted average shares outstanding for basic earnings (loss) per share (B)</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">8,786,510</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Add effects of potentially dilutive securities - assumed exercise of stock options</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">74,869</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" 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justify; text-indent: 0.5in;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style='font-style:italic;display:inline;'>&#160;</div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style='font-style:italic;display:inline;'>Recently issued accounting pronouncements not yet adopted:</div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In August 2016, the Financial Accounting Standards Board (&#8220;FASB&#8221;) issued Accounting Standards Update (&#8220;ASU&#8221;) No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. The new standard will change the classification of certain cash payments and receipts within the cash flow statement. Specifically, payments for debt prepayment or debt extinguishment costs, including third-party costs, premiums paid, and other fees paid to lenders that are directly related to the debt prepayment or debt extinguishment, excluding accrued interest, will now be classified as financing activities. Previously, these payments were classified as operating expenses. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019, with early adoption permitted, and will be applied retrospectively. The Company does not expect that the adoption of this new standard will have a material impact on its Consolidated Financial Statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. This ASU requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The ASU also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation &#150; Stock Compensation. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. The new standard is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements effective for the quarter ending January 31, 2018.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. This guidance will supersede Topic 605, Revenue Recognition, in addition to other industry-specific guidance, once effective. The new standard requires a company to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services.&#160;&#160;In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, as a revision to ASU 2014-09, which revised the effective date to fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted but not prior to periods beginning after December 15, 2016 (i.e., the original adoption date per ASU 2014-09). In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations, which clarifies certain aspects of the principal-versus-agent guidance, including how an entity should identify the unit of accounting for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments also reframe the indicators to focus on evidence that an entity is acting as a principal rather than as an agent. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property, which will determine whether it recognizes revenue over time or at a point in time. The amendments also clarify when a promised good or service is separately identifiable (i.e., distinct within the context of the contract) and allow entities to disregard items that are immaterial in the context of a contract. The Company continues to assess the impact this new standard may have on its ongoing financial reporting. The Company has identified its revenue streams both by contract and product type and is assessing each for potential impacts. For the revenue streams assessed, the Company does not anticipate a material impact in the timing or amount of revenue recognized.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles-Goodwill and Other, which simplifies the accounting for goodwill impairments by eliminating step 2 from the goodwill impairment test. Instead, if &#8220;the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.&#8221; The guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes the computation of basic and diluted earnings (loss) per share:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:100%;float: inherit;border-collapse:collapse;border-width:100%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Consolidated net income (loss) (A)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Weighted average shares outstanding for diluted earnings (loss) per share (C)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">8,915,764</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Basic earnings (loss) per share (A)/(B)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.04</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Diluted earnings (loss) per share (A)/(C)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.04</td><td 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style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">Estimated amortization expense related to finite lived intangible assets is as follows (in thousands):</div><div 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2018</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2021</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">413</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Thereafter</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">545</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Amortizable intangible assets:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Non-compete agreements (estimated lives 3 - 5 years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">310</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">310</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(310)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(273)</td><td width="1%" 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">37</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Customer relationships (estimated lives 7 - 15 years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">5,099</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(2,186)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">142</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Accumulated amortization</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Non-amortizable intangible assets:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" 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table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes our financial assets and 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width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">236</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:50%;float: inherit;border-collapse:collapse;border-width:50%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Description</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;1</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;2</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;3</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Earn-out liability</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">835</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:60%;float: inherit;border-collapse:collapse;border-width:60%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="17%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="5" rowspan="1">Level&#160;3</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,527</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Payments</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(578)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(790)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">98</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">835</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 310000 310000 310000 273000 1925000 1356000 134000 -652000 30964000 30241000 700000 0 25060000 25837000 6297000 11910000 10-K false 2017-10-31 2017 FY R F INDUSTRIES LTD 70000 141000 1237000 3619000 22242000 21778000 8722000 8463000 845000 747000 0 37000 5099000 5099000 2186000 1644000 0.66 1.95 4.36 P4Y3M18D 6853000 5902000 13100000 6835000 1036000 194000 0000740664 --10-31 No No Yes Smaller Reporting Company 3030000 3219000 3219000 828000 711000 3174000 7506000 9560000 8351000 13151000 371000 -4688000 P3Y 1007851 1240100 449068 104936 2913000 3455000 142000 142000 25000 15000 842000 0 -4683000 -1358000 -3232000 9300000 RFIL 8872246 6109000 6022000 4173000 174000 57000 10000 3462000 799000 871000 3203000 3302000 16793000 36763 180067 260385 157118 1159771 29000 5000 400000 -4683000 266000 -68000 0 <div style="CLEAR:both; FONT-FAMILY:Times New 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provision</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The provision (benefit) for income taxes for the fiscal years ended October 31, 2017 and 2016 consists of the following (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New 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style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Current:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(345)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Federal</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(293)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(179)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">State</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(128)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(290)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(307)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">134</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(652)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Income tax at the federal statutory rate is reconciled to the Company&#8217;s actual net provision (benefit) for income taxes as follows (in thousands, except percentages):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; 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New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="21%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF" colspan="5" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="21%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF" colspan="5" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">% of&#160;Pretax</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">%&#160;of&#160;Pretax</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">Amount</td><td width="1%" 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style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td 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Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">Income taxes at federal statutory rate</td><td width="1%" 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Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New 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style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">916</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-19.6</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr 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style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-2.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">52</td><td 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Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Qualified domestic production activities deduction</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(66)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-16.5</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">46</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-1.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#CCEEFF">ISO stock options</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">33</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">8.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">52</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:4px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-1.1</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Meals and entertainment</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">21</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">5.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">29</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-0.6</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#CCEEFF">Temporary true-ups</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">26</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">6.4</td><td 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style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">0.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">State tax refunds, net of federal expense</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(4)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-0.8</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(38)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">0.8</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#CCEEFF">R&#38;D credits</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">(37)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-9.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">(46)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">1.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Other</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">18</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">4.4</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(18)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">0.4</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:Double;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">$</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:Double;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">134</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;text-decoration: underline;padding:0px;;background-color:#cceeff">Deferred Tax Assets:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Reserves</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">216</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Accrued vacation</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">148</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Other</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">70</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">700</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Amortization / intangible assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(211)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Other</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(34)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:26px;;background-color:#cceeff">Total deferred tax liabilities</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(1,000)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="7%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td></tr><tr style="height:12px;"> <td width="55%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:39px;;background-color:#cceeff">Total net deferred tax assets (liabilities)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(119)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(409)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td></tr> </table></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Deferred income tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has evaluated the available evidence supporting the realization of its gross deferred tax assets, including the amount and timing of future taxable income, and has determined it is more likely than not that the assets will be realized in future tax years.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company had adopted the provisions of ASC 740-10, which clarifies the accounting for uncertain tax positions. ASC 740-10 requires that the Company recognize the impact of a tax position in the financial statements if the position is not more likely than not to be sustained upon examination based on the technical merits of the position. The Company&#8217;s practice is to recognize interest and penalties related to income tax matters in income from continuing operations. The Company has no material unrecognized tax benefits as of October 31, 2017.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company is subject to taxation in the United States and state jurisdictions. The Company&#8217;s tax years for October 31, 2014 and forward are subject to examination by the United States and October 31, 2013 and forward with state tax authorities.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">On December 22, 2017, the Tax Cuts and Jobs Act (the &#8220;Act&#8221;) was signed into United States tax law, which among other provisions will lower the corporate tax rate to 21%. Given this date of enactment, our <div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">consolidated&#160;</div>financial statements <div style="display:inline;; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: 400;">as of and&#160;</div>for the year ended October 31, 2017 do not reflect the impact of the Act. The Company is in the process of analyzing the potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the law was enacted.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"></div></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Income tax at the federal statutory rate is reconciled to the Company&#8217;s actual net provision (benefit) for income taxes as follows (in thousands, except percentages):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: 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New Roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF" colspan="5" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="21%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF" colspan="5" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td 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Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">%&#160;of&#160;Pretax</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">Income</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td 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Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td 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Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">Income taxes at federal statutory rate</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">$</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">136</td><td width="1%" 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style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Goodwill and other intangible asset impairment</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">0.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" 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style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-2.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">52</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-1.1</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Qualified domestic production activities deduction</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(66)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-16.5</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">46</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-1.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" 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width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">8.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">52</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:4px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-1.1</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Meals and entertainment</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">21</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">5.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">29</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-0.6</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#CCEEFF">Temporary true-ups</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">26</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td 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Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">0.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">State tax refunds, net of federal expense</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(4)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">-0.8</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(38)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">0.8</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#CCEEFF">R&#38;D credits</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">(37)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">-9.3</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">(46)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">1.0</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#FFFFFF">Other</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">18</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">4.4</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">(18)</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">0.4</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">%</td></tr><tr style="height:12px;"> <td width="45%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:Double;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">$</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:Double;font-family:Times New 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0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; 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initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">On December 22, 2017, the Tax Cuts and Jobs Act (the &#8220;Act&#8221;) was signed into United States tax law, which among other provisions will lower the corporate tax rate to 21%. Given this date of enactment, our financial statements for the year ended October 31, 2017 do not reflect the impact of the Act. The Company is in the process of analyzing the potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the law was enacted.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 552000 503000 552000 275000 P6Y3M29D 0.02 2018-01-15 2017-12-31 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" 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For the years ended October 31, 2017 and 2016, the Company contributed and recognized as an expense $166,000 and $182,000, respectively, which amount represented 3% of eligible employee earnings under its Safe Harbor Non-elective Employer Contribution Plan.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 166000 182000 74869 0 -2337000 781000 7595000 0.03 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">Note 11 - Related party transactions</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">During fiscal 2016 the Company had a note receivable from stockholder of $67,000 that was due from a former Chief Executive Officer of the Company, earned interest at 6% per annum (which interest was payable annually), and had no specific due date. The note was collateralized by property owned by the former Chief Executive Officer. During fiscal 2016, the former Chief Executive Officer resigned as an employee of the Company and, in connection with his resignation, repaid the foregoing promissory note in full.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">On June 15, 2011, the Company purchased Cables Unlimited, Inc., a New York corporation, from Darren Clark, the sole shareholder of Cables Unlimited, Inc. In connection with the purchase of Cables Unlimited, the Company entered into a lease for the New York facilities from which Cables Unlimited conducts its operations. Cables Unlimited&#8217;s monthly rent expense under the lease is $13,000 per month, plus payments of all utilities, janitorial expenses, routine maintenance costs, and costs of insurance for Cables Unlimited&#8217;s business operations and equipment. During the fiscal year ended October 31, 2017, the Company paid the landlord a total of $156,000 under the lease. The owner and landlord of the facility is a company controlled by Darren Clark, the former owner of Cables Unlimited and the current President of this subsidiary of the Company.</div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 0.06 13000 156000 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">Note 12 - Cash dividend and declared dividends</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company paid quarterly dividends of $0.02 per share during fiscal year 2017 for a total of $707,000. The Company paid quarterly dividends of $0.02, $0.02, $0.02 and $0.07 per share during the three months ended October, 31, 2016, July 31, 2016, April 30, 2016 and January 31, 2016, respectively, for a total of $1.1 million.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 0.21 0 0 236000 208000 349000 0 22000 0 321000 0.02 0.02 0.02 0 0 835000 835000 1527000 578000 158000 1000 157000 0 58248 0.02 0.07 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Note 13 - Commitments</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">As of October 31, 2017, the Company leases its facilities in San Diego, California, Yaphank, New York, Milford, Connecticut and East Brunswick, New Jersey under non-cancelable operating leases. Deferred rents, included in accrued expenses and other long-term liabilities, were $95,000 as of October 31, 2017 and $3,000 as of October 31, 2016. The San Diego lease also requires the payment of the Company's pro rata share of the real estate taxes and insurance, maintenance and other operating expenses related to the facilities.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Rent expense under all operating leases totaled approximately $644,000 and $628,000 in 2017 and 2016, respectively.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Minimum lease payments under these non-cancelable operating leases in each of the years subsequent to October 31, 2017 are as follows (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position:relative; width:100%;TEXT-INDENT:0.0in;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position:relative; width:100%;TEXT-INDENT:0.0in;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:50%;float: inherit;border-collapse:collapse;border-width:50%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">Year&#160;ending</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">October&#160;31,</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">2018</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">$</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">645</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">2019</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">516</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">2020</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">441</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">2021</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">440</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">2022</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">359</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:117px;;background-color:#FFFFFF">Total</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">$</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">2,401</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td></tr> </table></div></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Minimum lease payments under these non-cancelable operating leases in each of the years subsequent to October 31, 2017 are as follows (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 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Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">October&#160;31,</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="10%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;border-bottom-width:1px;border-bottom-color:Black;border-bottom-style:Solid;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">2018</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">$</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">645</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">2019</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">516</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">2020</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">441</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#CCEEFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">2021</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="1%" style="overflow:hidden;color:#000000;text-align:Left;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td><td width="9%" style="overflow:hidden;color:#000000;text-align:Right;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#FFFFFF">440</td><td width="1%" style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td></tr><tr style="height:12px;"> <td width="38%" style="overflow:hidden;color:#000000;text-align:Center;vertical-align:Bottom;font-family:Times New Roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#CCEEFF">2022</td><td width="1%" 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style="overflow:hidden;color:#000000;vertical-align:Top;font-family:Times New Roman;font-size:10pt;padding:0px;;background-color:#FFFFFF">&#160;</td></tr> </table></div></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 95000 3000 644000 -290000 -307000 -128000 -249000 0 67000 0 158000 0 157000 2520000 2642000 0 0 -4089000 21392000 88000 19379000 628000 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;<div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">Note 14 - Line of credit</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">From May 2015 until September 2016, the Company had a $5 million line of credit available to it from its bank. The Company did not use the line of credit and, effective September 8, 2016, the Company terminated the line of credit.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 790000 -21000 98000 236000 5000000 2016-09-08 645000 516000 441000 1925000 8835483 56000 1000 55000 0 194000 279000 3395000 3101000 24000 -13000 424000 -345000 -293000 -179000 3000 -128000 440000 359000 2401000 1000000 36763 6000 0 6000 0 136000 -1592000 16000 -53000 0.340 115000 135000 83000 83000 500000 500000 1000000 1726138 214000 0 214000 0 707000 0.340 0.040 0.011 0 916000 526000 347000 20000 871000 0 0 707000 0 0 -9000 52000 -66000 46000 33000 52000 21000 29000 26000 0 382000 21343000 89000 19654000 1600000 8872246 0 168000 6000 154000 6000 154000 <div style="CLEAR:both; 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Business activities</div></div><div style="CLEAR:both;CLEAR:both; 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">RF Industries, Ltd., together with its three wholly-owned subsidiaries (collectively, hereinafter the &#8220;Company&#8221;), primarily engages in the design, manufacture, and marketing of interconnect products and systems, including coaxial and specialty cables, fiber optic cables and connectors, and electrical and electronic specialty cables. For internal operating and reporting purposes, and for marketing purposes, as of the end of the fiscal year ended October 31, 2017 the Company classified its operations into the following four divisions/subsidiaries: (i) The RF Connector and Cable Assembly division designs, manufactures and distributes coaxial connectors and cable assemblies that are integrated with coaxial connectors; (ii) Cables Unlimited, Inc., the subsidiary that manufactures custom and standard cable assemblies, complex hybrid fiber optic power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive and medical equipment; (iii) Comnet Telecom Supply, Inc., the subsidiary that manufactures and sells fiber optics cable, distinctive cabling technologies and custom patch cord assemblies, as well as other data center products; and (iv) Rel-Tech Electronics, Inc., the subsidiary that designs and manufacturers of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers. Both the Cables Unlimited division and the Comnet Telecom division are Corning Cables Systems CAH Connections SM Gold Program members that are authorized to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems&#8217; extended warranty. During the fiscal year ended October 31, 2016, RF Industries, Ltd. sold the Aviel Electronics division that designed, manufactured and distributed specialty and custom RF connectors, and discontinued the Bioconnect division that manufactured and distributed cabling and interconnect products to the medical monitoring market.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Use of estimates&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results may differ from those estimates.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Principles of consolidation</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The accompanying consolidated financial statements include the accounts of RF Industries, Ltd., Cables Unlimited, Inc. (&#8220;Cables Unlimited&#8221;), Comnet Telecom Supply, Inc. (&#8220;Comnet&#8221;), and Rel-Tech Electronics, Inc. (&#8220;Rel-Tech&#8221;), wholly-owned subsidiaries of RF Industries, Ltd. All intercompany balances and transactions have been eliminated in consolidation.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Cash equivalents</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.</div><div style="CLEAR:both;CLEAR:both; 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Revenue recognition</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; 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The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and for shipments with terms of FOB Shipping Point, revenue is recognized upon shipment, for shipments with terms of FOB Destination, revenue is recognized upon delivery and revenue from services is recognized when services are performed, and the recovery of the consideration is considered probable.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Inventories</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Inventories are stated at the lower of cost or market, with cost determined using the weighted average cost of accounting. Cost includes materials, labor, and manufacturing overhead related to the purchase and production of inventories. We regularly review inventory quantities on hand, future purchase commitments with our suppliers, and the estimated utility of our inventory. If our review indicates a reduction in utility below carrying value due to damage, physical deterioration, obsolescence, changes in price levels, or other causes, we reduce our inventory to a new cost basis through a charge to cost of sales in the period in which it occurs. The determination of market value and the estimated volume of demand used in the lower of cost or market analysis requires significant judgment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech prospectively values its inventories cost using the weighted average cost of accounting.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Property and equipment</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Equipment, tooling and furniture are recorded at cost and depreciated over their estimated useful lives (generally 3 to 5 years) using the straight-line method. Expenditures for repairs and maintenance are charged to operations in the period incurred.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Goodwill</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Goodwill is not amortized, but is subject to impairment analysis at least once annually, which the Company performs in October, or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit&#8217;s carrying amount is greater than its fair value.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">We assess whether a goodwill impairment exists using both qualitative and quantitative assessments at the reporting level. Our qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we will not perform a quantitative assessment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if we elect not to perform a qualitative assessment, we perform a quantitative assessment, or two-step impairment test, to determine whether a goodwill impairment exists at the reporting unit. The first step in our quantitative assessment identifies potential impairments by comparing the estimated fair value of the reporting unit to its carrying value, including goodwill (&#8220;Step 1&#8221;). If the carrying value exceeds estimated fair value, there is an indication of potential impairment and the second step is performed to measure the amount of impairment (&#8220;Step 2&#8221;).</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">For the fiscal year 2016, Cables Unlimited did not meet its sales volume and revenue goals, and the mix of product sold had lower margins than planned. These results, along with changes in the competitive marketplace and an evaluation of business priorities, led to a shift in strategic direction and reduced future revenue and profitability expectations for the business. The results of these changes and circumstances lead to the determination that Cables Unlimited did not pass our qualitative assessment and therefore a quantitative assessment was required.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Upon completion of our Step 1 test, we found that the results indicated that Cables Unlimited&#8217;s carrying value exceeded its estimated fair value, and as a result, the Step 2 test was performed specific to Cables Unlimited. Under Step 2, the fair value of all assets and liabilities were estimated, including customer list and backlog, for the purpose of deriving an estimate of the fair value of goodwill. The fair value of the goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Assumptions used in measuring the value of these assets and liabilities included the discount rates used in valuing the intangible assets, and consideration of the market environment in valuing the tangible assets.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Upon completion of our Step 2 test, our Cables Unlimited division&#8217;s goodwill was determined to be impaired. As of October 31, 2016, the Company recorded a $2.6 million impairment charge to goodwill. Cables Unlimited&#8217;s goodwill is included in the Custom Cabling Manufacturing and Assembly segment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">No other instances of impairment were identified as of October 31, 2016 and no instances of goodwill impairment were identified during the year ended October 31, 2017.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">On June 15, 2011, the Company completed its acquisition of Cables Unlimited. Goodwill related to this acquisition is included within the Cables Unlimited reporting unit. Effective November 1, 2014, the Company also completed its acquisition of Comnet. Goodwill related to this acquisition is included within the Comnet reporting unit. As of May 19, 2015, the Company completed its acquisition of the CompPro product line. Goodwill related to this acquisition is included within the Connector and Cable Assembly Division. Effective June 1, 2015, the Company completed its acquisition of Rel-Tech. Goodwill related to this acquisition is included within the Rel-Tech reporting unit.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Long-lived assets</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company assesses property, plant and equipment and intangible assets, which are considered definite-lived assets for impairment. Definite-lived assets are reviewed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. The Company has made no material adjustments to our long-lived assets in any of the years presented.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In addition, the Company tests our trademarks and indefinite-lived asset for impairment at least annually or more frequently if events or changes in circumstances indicate that these assets may be impaired.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In 2016, upon completion of our Step 2 test (see &#8220;Goodwill&#8221; above), our Cables Unlimited division&#8217;s trademark was determined to be impaired. As of October 31, 2016, the Company recorded a $150,000 impairment charge to its trademark. Cables Unlimited&#8217;s trademark is included in the Custom Cabling Manufacturing and Assembly segment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">No instances of impairment were identified as of October 31, 2017 and no other instances of impairment were identified as of October 31, 2016.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Earn-out liability</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The purchase agreement for the Rel-Tech acquisition provides for earn-out payments of up to $800,000 in the aggregate, last installment of which is payable May 31, 2018. The initial earn-out liability was valued at its fair value using the Monte Carlo simulation and is included as a component of the total purchase price. The earn-out was and will continue to be revalued quarterly using a present value approach and any resulting increase or decrease will be recorded into selling and general expenses. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. Significant judgment is employed in determining the appropriateness of the assumptions used in calculating the fair value of the earn-out as of the acquisition date. Accordingly, significant variances between actual and forecasted results or changes in the assumptions can materially impact the amount of contingent consideration expense we record in future periods.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company measures at fair value certain financial assets and liabilities. U. S. GAAP specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. These two types of inputs have created the following fair-value hierarchy:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 22.5pt;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Level&#160;1&#151; Quoted prices for identical instruments in active markets;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Level&#160;2&#151; Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets;&#160;and</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Level&#160;3&#151; Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.</div><div style="CLEAR:both;CLEAR:both; 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The contingent consideration liability represents future earn-out liability that we may be required to pay in conjunction with the acquisition of Rel-Tech and Comnet. 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Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2017 (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:50%;float: inherit;border-collapse:collapse;border-width:50%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Description</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;1</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;2</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;3</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Earn-out liability</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">236</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in 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inherit;border-collapse:collapse;border-width:50%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Description</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;1</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;2</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;3</td><td 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">835</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="17%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="5" rowspan="1">Level&#160;3</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">835</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,527</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Non-compete agreements (estimated lives 3 - 5 years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">310</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">310</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Accumulated 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(273)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">37</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(1,644)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2,913</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,455</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">142</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Accumulated 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(15)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">117</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">127</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Totals</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,030</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,619</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Non-amortizable intangible assets:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,237</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,237</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">Impairment to trademarks for the years ended October 31, 2017 and 2016 was $0 and $150,000, respectively.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times 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inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Year&#160;ending</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">October&#160;31,</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2018</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2019</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2020</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2021</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">413</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2022</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">413</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Thereafter</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">545</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:117px;;background-color:#cceeff">Total</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3,030</td><td width="1%" 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style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Advertising</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; 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0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company expenses the cost of advertising and promotions as incurred. Advertising costs charged to operations were approximately $130,000 and $156,000 in 2017 and 2016, respectively.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Research and development</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Research and development costs are expensed as incurred. The Company&#8217;s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Income taxes</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company accounts for income taxes under the asset and liability method, based on the income tax laws and rates in the jurisdictions in which operations are conducted and income is earned. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Developing the provision (benefit) for income taxes requires significant judgment and expertise in federal, international and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Management&#8217;s judgments and tax strategies are subject to audit by various taxing authorities.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Stock options</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">For stock option grants to employees, the Company recognizes compensation expense based on the estimated fair value of the options at the date of grant. Stock-based employee compensation expense is recognized on a straight-line basis over the requisite service period. The Company issues previously unissued common shares upon the exercise of stock options.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">For the fiscal years ended October 31, 2017 and 2016, charges related to stock-based compensation amounted to approximately $214,000 and $206,000, respectively. For the fiscal years ended October 31, 2017 and 2016, stock-based compensation classified in cost of sales amounted to $13,000 and $28,000 and stock-based compensation classified in selling and general and engineering expense amounted to $201,000 and $178,000, respectively.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Earnings (loss) per share</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Basic earnings (loss) per share is calculated by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the period. The calculation of diluted earnings (loss) per share is similar to that of basic earnings (loss) per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all potentially dilutive common shares, principally those issuable upon the exercise of stock options, were issued and the treasury stock method had been applied during the period. The greatest number of shares potentially issuable by the Company upon the exercise of stock options in any period for the years ended October 31, 2017 and 2016, that were not included in the computation because they were anti-dilutive, totaled 737,512 and 824,441, respectively.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes the computation of basic and diluted earnings (loss) per share:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="13%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Numerators:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Consolidated net income (loss) (A)</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(4,089,000)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Denominators:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Weighted average shares outstanding for basic earnings (loss) per share (B)</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">8,786,510</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Add effects of potentially dilutive securities - assumed exercise of stock options</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">74,869</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" 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new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="71%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Basic earnings (loss) per share (A)/(B)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Recent accounting standards</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; 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FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;"><div style='font-style:italic;display:inline;'>Recently issued accounting pronouncements not yet adopted:</div></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In August 2016, the Financial Accounting Standards Board (&#8220;FASB&#8221;) issued Accounting Standards Update (&#8220;ASU&#8221;) No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. The new standard will change the classification of certain cash payments and receipts within the cash flow statement. Specifically, payments for debt prepayment or debt extinguishment costs, including third-party costs, premiums paid, and other fees paid to lenders that are directly related to the debt prepayment or debt extinguishment, excluding accrued interest, will now be classified as financing activities. Previously, these payments were classified as operating expenses. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019, with early adoption permitted, and will be applied retrospectively. The Company does not expect that the adoption of this new standard will have a material impact on its Consolidated Financial Statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. This ASU requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The ASU also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation &#150; Stock Compensation. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. The new standard is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements effective for the quarter ending January 31, 2018.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. This guidance will supersede Topic 605, Revenue Recognition, in addition to other industry-specific guidance, once effective. The new standard requires a company to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services.&#160;&#160;In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, as a revision to ASU 2014-09, which revised the effective date to fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted but not prior to periods beginning after December 15, 2016 (i.e., the original adoption date per ASU 2014-09). In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations, which clarifies certain aspects of the principal-versus-agent guidance, including how an entity should identify the unit of accounting for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments also reframe the indicators to focus on evidence that an entity is acting as a principal rather than as an agent. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property, which will determine whether it recognizes revenue over time or at a point in time. The amendments also clarify when a promised good or service is separately identifiable (i.e., distinct within the context of the contract) and allow entities to disregard items that are immaterial in the context of a contract. The Company continues to assess the impact this new standard may have on its ongoing financial reporting. The Company has identified its revenue streams both by contract and product type and is assessing each for potential impacts. For the revenue streams assessed, the Company does not anticipate a material impact in the timing or amount of revenue recognized.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles-Goodwill and Other, which simplifies the accounting for goodwill impairments by eliminating step 2 from the goodwill impairment test. Instead, if &#8220;the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.&#8221; The guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Business activities</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">RF Industries, Ltd., together with its three wholly-owned subsidiaries (collectively, hereinafter the &#8220;Company&#8221;), primarily engages in the design, manufacture, and marketing of interconnect products and systems, including coaxial and specialty cables, fiber optic cables and connectors, and electrical and electronic specialty cables. For internal operating and reporting purposes, and for marketing purposes, as of the end of the fiscal year ended October 31, 2017 the Company classified its operations into the following four divisions/subsidiaries: (i) The RF Connector and Cable Assembly division designs, manufactures and distributes coaxial connectors and cable assemblies that are integrated with coaxial connectors; (ii) Cables Unlimited, Inc., the subsidiary that manufactures custom and standard cable assemblies, complex hybrid fiber optic power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive and medical equipment; (iii) Comnet Telecom Supply, Inc., the subsidiary that manufactures and sells fiber optics cable, distinctive cabling technologies and custom patch cord assemblies, as well as other data center products; and (iv) Rel-Tech Electronics, Inc., the subsidiary that designs and manufacturers of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers. Both the Cables Unlimited division and the Comnet Telecom division are Corning Cables Systems CAH Connections SM Gold Program members that are authorized to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems&#8217; extended warranty. During the fiscal year ended October 31, 2016, RF Industries, Ltd. sold the Aviel Electronics division that designed, manufactured and distributed specialty and custom RF connectors, and discontinued the Bioconnect division that manufactured and distributed cabling and interconnect products to the medical monitoring market.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Use of estimates&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results may differ from those estimates.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> -4000 -38000 37000 46000 -18000 18000 0.0 -0.196 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Principles of consolidation</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The accompanying consolidated financial statements include the accounts of RF Industries, Ltd., Cables Unlimited, Inc. (&#8220;Cables Unlimited&#8221;), Comnet Telecom Supply, Inc. (&#8220;Comnet&#8221;), and Rel-Tech Electronics, Inc. (&#8220;Rel-Tech&#8221;), wholly-owned subsidiaries of RF Industries, Ltd. All intercompany balances and transactions have been eliminated in consolidation.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Cash equivalents</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Revenue recognition</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and for shipments with terms of FOB Shipping Point, revenue is recognized upon shipment, for shipments with terms of FOB Destination, revenue is recognized upon delivery and revenue from services is recognized when services are performed, and the recovery of the consideration is considered probable.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Inventories</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Inventories are stated at the lower of cost or market, with cost determined using the weighted average cost of accounting. Cost includes materials, labor, and manufacturing overhead related to the purchase and production of inventories. We regularly review inventory quantities on hand, future purchase commitments with our suppliers, and the estimated utility of our inventory. If our review indicates a reduction in utility below carrying value due to damage, physical deterioration, obsolescence, changes in price levels, or other causes, we reduce our inventory to a new cost basis through a charge to cost of sales in the period in which it occurs. The determination of market value and the estimated volume of demand used in the lower of cost or market analysis requires significant judgment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech prospectively values its inventories cost using the weighted average cost of accounting.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> -0.023 -0.011 0.083 -0.011 0.053 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Property and equipment</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Equipment, tooling and furniture are recorded at cost and depreciated over their estimated useful lives (generally 3 to 5 years) using the straight-line method. Expenditures for repairs and maintenance are charged to operations in the period incurred.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Goodwill</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Goodwill is not amortized, but is subject to impairment analysis at least once annually, which the Company performs in October, or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit&#8217;s carrying amount is greater than its fair value.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">We assess whether a goodwill impairment exists using both qualitative and quantitative assessments at the reporting level. Our qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we will not perform a quantitative assessment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if we elect not to perform a qualitative assessment, we perform a quantitative assessment, or two-step impairment test, to determine whether a goodwill impairment exists at the reporting unit. The first step in our quantitative assessment identifies potential impairments by comparing the estimated fair value of the reporting unit to its carrying value, including goodwill (&#8220;Step 1&#8221;). If the carrying value exceeds estimated fair value, there is an indication of potential impairment and the second step is performed to measure the amount of impairment (&#8220;Step 2&#8221;).</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">For the fiscal year 2016, Cables Unlimited did not meet its sales volume and revenue goals, and the mix of product sold had lower margins than planned. These results, along with changes in the competitive marketplace and an evaluation of business priorities, led to a shift in strategic direction and reduced future revenue and profitability expectations for the business. The results of these changes and circumstances lead to the determination that Cables Unlimited did not pass our qualitative assessment and therefore a quantitative assessment was required.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Upon completion of our Step 1 test, we found that the results indicated that Cables Unlimited&#8217;s carrying value exceeded its estimated fair value, and as a result, the Step 2 test was performed specific to Cables Unlimited. Under Step 2, the fair value of all assets and liabilities were estimated, including customer list and backlog, for the purpose of deriving an estimate of the fair value of goodwill. The fair value of the goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Assumptions used in measuring the value of these assets and liabilities included the discount rates used in valuing the intangible assets, and consideration of the market environment in valuing the tangible assets.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Upon completion of our Step 2 test, our Cables Unlimited division&#8217;s goodwill was determined to be impaired. As of October 31, 2016, the Company recorded a $2.6 million impairment charge to goodwill. Cables Unlimited&#8217;s goodwill is included in the Custom Cabling Manufacturing and Assembly segment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">No other instances of impairment were identified as of October 31, 2016 and no instances of goodwill impairment were identified during the year ended October 31, 2017.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">On June 15, 2011, the Company completed its acquisition of Cables Unlimited. Goodwill related to this acquisition is included within the Cables Unlimited reporting unit. Effective November 1, 2014, the Company also completed its acquisition of Comnet. Goodwill related to this acquisition is included within the Comnet reporting unit. As of May 19, 2015, the Company completed its acquisition of the CompPro product line. Goodwill related to this acquisition is included within the Connector and Cable Assembly Division. Effective June 1, 2015, the Company completed its acquisition of Rel-Tech. Goodwill related to this acquisition is included within the Rel-Tech reporting unit.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> -0.006 0.064 0.0 -0.008 0.008 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Long-lived assets</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company assesses property, plant and equipment and intangible assets, which are considered definite-lived assets for impairment. Definite-lived assets are reviewed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. The Company has made no material adjustments to our long-lived assets in any of the years presented.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In addition, the Company tests our trademarks and indefinite-lived asset for impairment at least annually or more frequently if events or changes in circumstances indicate that these assets may be impaired.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">In 2016, upon completion of our Step 2 test (see &#8220;Goodwill&#8221; above), our Cables Unlimited division&#8217;s trademark was determined to be impaired. As of October 31, 2016, the Company recorded a $150,000 impairment charge to its trademark. Cables Unlimited&#8217;s trademark is included in the Custom Cabling Manufacturing and Assembly segment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;">No instances of impairment were identified as of October 31, 2017 and no other instances of impairment were identified as of October 31, 2016.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Earn-out liability</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The purchase agreement for the Rel-Tech acquisition provides for earn-out payments of up to $800,000 in the aggregate, last installment of which is payable May 31, 2018. The initial earn-out liability was valued at its fair value using the Monte Carlo simulation and is included as a component of the total purchase price. The earn-out was and will continue to be revalued quarterly using a present value approach and any resulting increase or decrease will be recorded into selling and general expenses. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. Significant judgment is employed in determining the appropriateness of the assumptions used in calculating the fair value of the earn-out as of the acquisition date. Accordingly, significant variances between actual and forecasted results or changes in the assumptions can materially impact the amount of contingent consideration expense we record in future periods.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company measures at fair value certain financial assets and liabilities. U. S. GAAP specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. 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text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Level&#160;1&#151; Quoted prices for identical instruments in active markets;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Level&#160;2&#151; Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets;&#160;and</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Level&#160;3&#151; Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.</div><div style="CLEAR:both;CLEAR:both; 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The contingent consideration liability represents future earn-out liability that we may be required to pay in conjunction with the acquisition of Rel-Tech and Comnet. 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Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2017 (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:50%;float: inherit;border-collapse:collapse;border-width:50%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Description</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;1</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;2</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;3</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Earn-out liability</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">236</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in 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inherit;border-collapse:collapse;border-width:50%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="25%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Description</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;1</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;2</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Level&#160;3</td><td 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">835</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="17%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="5" rowspan="1">Level&#160;3</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="8%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">835</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="7%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,527</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" 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roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Amortizable intangible assets:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Non-compete agreements (estimated lives 3 - 5 years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">310</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(273)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Customer relationships (estimated lives 7 - 15 years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">5,099</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2,913</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,455</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Patents (estimated life 14 years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">142</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">142</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Accumulated 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(15)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">117</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">127</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Totals</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,030</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3,619</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="52%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Non-amortizable intangible assets:</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,237</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,237</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in; background-color: transparent;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">Estimated amortization expense related to finite lived intangible assets is as follows (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times 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inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">Year&#160;ending</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">October&#160;31,</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="7%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Amount</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2018</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2019</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2020</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">553</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2021</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">413</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2022</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">413</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Thereafter</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">545</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="41%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:117px;;background-color:#cceeff">Total</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="6%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3,030</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Advertising</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; 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Advertising costs charged to operations were approximately $130,000 and $156,000 in 2017 and 2016, respectively.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> -0.093 0.010 0.044 0.004 0.335 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Research and development</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Research and development costs are expensed as incurred. The Company&#8217;s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Income taxes</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company accounts for income taxes under the asset and liability method, based on the income tax laws and rates in the jurisdictions in which operations are conducted and income is earned. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Developing the provision (benefit) for income taxes requires significant judgment and expertise in federal, international and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Management&#8217;s judgments and tax strategies are subject to audit by various taxing authorities.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense.</div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 0.139 375000 216000 122000 134000 184000 159000 130000 148000 70000 43000 881000 700000 805000 864000 195000 211000 0 34000 1000000 1109000 119000 409000 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Note 9 - Stock options</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Incentive and non-qualified stock option plans</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">On March 9, 2010, the Company&#8217;s Board of Directors adopted the RF Industries, Ltd. 2010 Stock Incentive Plan (the &#8220;2010 Plan&#8221;). In June 2010, the Company&#8217;s stockholders approved the 2010 Plan by vote as required by NASDAQ. An aggregate of 1,000,000 shares of common stock was set aside and reserved for issuance under the 2010 Plan. The Company&#8217;s stockholders approved the issuance of an additional 500,000 shares of common stock at its annual meeting held on September 5, 2014, another 500,000 shares of common stock at its annual meeting held September 4, 2015 and another 1,000,000 shares of common stock at its annual meeting held September 8, 2017. As of October 31, 2017, 1,726,138 shares of common stock were remaining for future grants of stock options under the 2010 Plan.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Additional disclosures related to stock option plans&#160;</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: right;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The fair value of each option granted in 2017 and 2016 was estimated on the grant date using the Black-Scholes option pricing model with the following assumptions:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; font-size:10pt;;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:90%;float: inherit;border-collapse:collapse;border-width:90%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Weighted average volatility</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">43.3</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">%</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">28.7</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">%</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Expected dividends</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">5.0</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">%</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2.4</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">%</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Expected term (in years)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4.3</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.0</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Risk-free interest rate</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.20</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">%</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.70</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">%</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Weighted average fair value of options granted during the year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.39</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.66</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Weighted average fair value of options vested during the year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.95</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4.36</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; font-size:10pt;;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Expected volatilities are based on historical volatility of the Company&#8217;s stock price and other factors. The Company used the historical method to calculate the expected life of the 2017 option grants. The expected life represents the period of time that options granted are expected to be outstanding. The risk-free rate is based on the U.S. Treasury rate with a maturity date corresponding to the options&#8217; expected life. The dividend yield is based upon the historical dividend yield.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in; background-color: transparent;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Additional information regarding all of the Company's outstanding stock options at October 31, 2017 and 2016 and changes in outstanding stock options in 2017 and 2016 follows:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:100%;float: inherit;border-collapse:collapse;border-width:100%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="23%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="5" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="23%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="5" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Shares&#160;or</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Shares&#160;or</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Price&#160;Per</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Average</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Price&#160;Per</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Average</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Share</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Exercise&#160;Price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Share</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Exercise&#160;Price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options outstanding at beginning of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,007,851</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4.07</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,240,100</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.64</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Options granted</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">449,068</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.61</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">104,936</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3.36</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Options exercised</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(36,763)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.50</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(180,067)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.27</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Options forfeited</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(260,385)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4.10</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(157,118)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4.53</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options outstanding at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,159,771</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.19</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,007,851</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4.07</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options exercisable at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">926,272</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.08</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">724,457</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.93</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options vested and expected to vest at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,159,002</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.19</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,002,522</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4.07</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Option price range at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff"> 1.07 - $6.91 </td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff"> 2.30 - $6.91 </td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Aggregate intrinsic value of options exercised during year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">55,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">456,000</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div><div style="CLEAR:both;CLEAR:both; 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-webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Weighted average remaining contractual life of options outstanding as of October 31, 2017: 4.19 years</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; font-size:10pt;;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Weighted average remaining contractual life of options exercisable as of October 31, 2017: 3.18 years</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Weighted average remaining contractual life of options vested and expected to vest as of October 31, 2017: 4.19 years</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; font-size:10pt;;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Aggregate intrinsic value of options outstanding at October 31, 2017: $552,000</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Aggregate intrinsic value of options exercisable at October 31, 2017: $503,000</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">Aggregate intrinsic value of options vested and expected to vest at October 31, 2017: $552,000</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">As of October 31, 2017, $275,000 of expense with respect to nonvested share-based arrangements has yet to be recognized which is expected to be recognized over a weighted average period of 6.33 years.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Effective for the fiscal year ending October 31, 2017, non-employee directors receive $50,000 annually, which is paid one-half in cash and one-half through the grant of non-qualified stock options to purchase shares of the Company&#8217;s common stock. Previously, for the fiscal year ended October 31, 2016, non-employee directors received $30,000 annually. During the quarter ended January 31, 2017, the Company granted each of its four non-employee directors 77,339 options. The number of stock options granted to each director was determined by dividing $25,000 by the fair value of a stock option grant using the Black-Scholes model ($0.32 per share). These options vest ratably over fiscal year 2017. On June 9, 2017, the Company&#8217;s Board of Directors appointed Gerald Garland to serve as a director. Mr. Garland received a prorated portion of the compensation paid by the Company. The number of stock options granted to Mr. Garland was determined by dividing $9,863 (the portion of his director fee for the year ending October 31, 2017) by the fair value of a stock option grant using the Black-Scholes model ($0.40 per share). 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On becoming a non-employee member of the Board on April 7, 2016, Mr. Hill was granted 33,744 options, representing the director compensation payable to him for his services for the remainder of the 2016 fiscal year. The number of stock options granted was determined by dividing his pro-rata portion of his stock based compensation for serving on the Board of $8,750 by the fair value of a stock option grant using the Black-Scholes model ($0.26). 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transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The fair value of each option granted in 2017 and 2016 was estimated on the grant date using the Black-Scholes option pricing model with the following assumptions:</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; font-size:10pt;;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:90%;float: inherit;border-collapse:collapse;border-width:90%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Weighted average volatility</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">43.3</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">%</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">28.7</td><td width="1%" 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">0.70</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">%</td> </tr><tr style="height:12px;"> <td width="66%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Weighted average fair value of options granted during the year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="9%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.39</td><td width="1%" style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="9%" 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style="overflow:hidden;color:black;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; 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style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:100%;float: inherit;border-collapse:collapse;border-width:100%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="23%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Shares&#160;or</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Weighted</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Average</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Share</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Exercise&#160;Price</td><td width="1%" 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rowspan="1">Exercise&#160;Price</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options outstanding at beginning of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,240,100</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.64</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Options granted</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">449,068</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1.61</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">104,936</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">3.36</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#cceeff">Options exercised</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(36,763)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1.50</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(180,067)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">0.27</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:13px;;background-color:#ffffff">Options forfeited</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(260,385)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4.10</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(157,118)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">4.53</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options outstanding at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,159,771</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.19</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,007,851</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4.07</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options exercisable at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">926,272</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.08</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">724,457</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.93</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Options vested and expected to vest at end of year</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,159,002</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3.19</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">1,002,522</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">4.07</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="51%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 0.433 0.287 0.050 0.024 0.0120 0.0070 0.39 P3Y P5Y 2600000 589000 649000 0 150000 130000 156000 13000 28000 201000 178000 737512 824441 800000 150000 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">174</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">57</td><td width="1%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Royalties</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">174</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">57</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Bioconnect</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">10</td><td width="1%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">68</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(33)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Income (loss) from discontinued operations, net of tax</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">(58)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 174000 57000 68000 -33000 -148000 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;">Note 3 - Concentrations of credit risk</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; font-size:10pt;;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At October 31, 2017, the Company had cash and cash equivalent balances in excess of federally insured limits in the amount of approximately $5.2 million.<div style="display:inline;font-size: 13.3333px; text-indent: 0.5in; font-style: normal; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: normal;">&#160;</div></div><br/><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Two customers accounted for approximately 20% and 11% of the Company&#8217;s net sales for the fiscal year ended October 31, 2017, and one customer accounted for approximately 15% of the Company&#8217;s net sales for the fiscal year ended October 31, 2016. At October 31, 2017 these customers&#8217; accounts receivable balance accounted for approximately 27% and 5% of the Company&#8217;s total net accounts receivable balances, and at October 31, 2016, this customer&#8217;s accounts receivable balance accounted for approximately 20% of the Company&#8217;s total net accounts receivable balance. &#160;Although these customers have been on-going major customers of the Company continuously in the past, the written agreements with these customers do not have any minimum purchase obligations and the customers could stop buying the Company&#8217;s products at any time and for any reason. A reduction, delay or cancellation of orders from these customers or the loss of these customers could significantly reduce the Company&#8217;s future revenues and profits.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">There was no product line that was significant for the fiscal years ended October 31, 2017 and 2016.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 10pt; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 5200000 0.2 0.11 0.15 0.27 0.05 0.2 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Note 4 - Inventories and major vendors</div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Inventories, consisting of materials, labor and manufacturing overhead, are stated at the lower of cost or market. Cost has been determined using the weighted average cost method.&#160;In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech values its inventory cost using the weighted average cost of accounting. Inventories consist of the following (in thousands):&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 85%; border-collapse: collapse; float: inherit; margin: 0in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Raw materials and supplies</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2,520</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2,642</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Work in process</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">279</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Finished goods</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3,395</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Totals</td><td width="1%" 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normal;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 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font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">Purchases of inventory from two major vendors during fiscal 2017 represented 7% and 5%, respectively, of total inventory purchases compared to two major vendors who represented 9% and 6%, respectively, of total inventory purchases in fiscal 2016. The Company has arrangements with these vendors to purchase product based on purchase orders periodically issued by the Company.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;"></div></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif ">Inventories consist of the following (in thousands):</div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width: 85%; border-collapse: collapse; float: inherit; margin: 0in; border: 0px solid;" align="left"> <tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Raw materials and supplies</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2,520</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">2,642</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Work in process</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">194</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">279</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Finished goods</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3,395</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">3,101</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,022</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr> </table></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> 0.07 0.05 0.09 0.06 <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;"><div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;font-weight:bold;display:inline;width:100%;">Note 5 - 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">526</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">347</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Notes receivable, current portion</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">83</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">83</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td 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roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">135</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Totals</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">744</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">1,436</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr> </table></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; 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Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Long-term portion of notes receivable of zero and $21,000 is recorded in other assets as of October 31, 2017 and 2016, respectively.</div></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times 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roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">871</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Prepaid expense</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">526</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">347</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Notes receivable, current portion</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Totals</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">744</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new 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initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;"></div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">Accrued expenses consist of the following (in thousands):</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:85%;float: inherit;border-collapse:collapse;border-width:85%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2017</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff" colspan="2" rowspan="1">2016</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Wages payable</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">855</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">941</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Accrued receipts</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">695</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">578</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Earn-out liability</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">236</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">707</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Other current liabilities</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">544</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Totals</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">2,242</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new 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normal; margin: 0pt 0px; text-align: justify; text-indent: 0.5in;">The non-current portion of the earn-out liability of $128,000 is recorded in other long-term liabilities as of October 31, 2016</div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"></div></div><table border="0" style="border-collapse:collapse; clear:both;width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td style="background-color: #fff"></td></tr></table><table border="0" style="width:100%; table-layout:fixed;" cellspacing="0" cellpadding="0"><tr><td></td></tr></table> <div style="CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif "><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; 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justify;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;TEXT-ALIGN:Left;position: relative; width: 100%; text-indent: 0in; float: none; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;; font-weight: normal;"><table cellspacing="0" cellpadding="0" style="clear:both;clear:both;width:85%;float: inherit;border-collapse:collapse;border-width:85%;float: inherit;MARGIN: 0in 0in 0in 0in;" align="left"> <tr style="height:12px;"> <td width="60%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" 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style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new 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text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-align: justify;"><div style="display:inline;color: black;">&#160;</div><div style="display:inline;margin-right: 0px; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: normal;">&#160;</div>&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">The Company aggregates operating divisions into operating segments which have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; and (5) if applicable, the nature of the regulatory environment. 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The specific customers are different for each division; however, there is some overlapping of product sales to them. The methods used to distribute products are similar within each division aggregated.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px 0pt 0in; text-indent: 0.5in;">Management identifies the Company&#8217;s segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the RF Connector and Cable Assembly division constitutes the RF Connector and Cable Assembly segment<div style="display:inline;; margin-right: 0px; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: normal;"><div style="display:inline;font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, serif; ; margin-right: 0px; font-style: normal; font-weight: normal;">, and</div></div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: normal;"></div> the Cables Unlimited, Comnet and Rel-Tech division <div style="display:inline;; margin-right: 0px; font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: normal;"><div style="display:inline;font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, serif; ; margin-right: 0px; font-style: normal; font-weight: normal;">constitute</div></div><div style="display:inline;font-style: normal; font-size: 13.3333px; font-family: &#34;Times New Roman&#34;, Times, serif; font-weight: normal;"></div> the Custom Cabling Manufacturing segment.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">As reviewed by the Company&#8217;s chief operating decision maker, the Company evaluates the performance of each segment based on income or loss before income taxes. The Company charges depreciation and amortization directly to each division within the segment. Accounts receivable, inventory, property and equipment, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same for the Company as a whole.</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px;">&#160;</div><div style="CLEAR:both;CLEAR:both; FONT-FAMILY:Times New Roman;FONT-SIZE: 10pt;color: rgb(0, 0, 0); font-family: &#34;Times New Roman&#34;, Times, serif; font-size: 13.3333px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: normal; orphans: 2; text-align: start; text-transform: none; transparent-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial; font-stretch: normal; line-height: normal; margin: 0pt 0px; text-indent: 0.5in;">Substantially all of the Company&#8217;s operations are conducted in the United States; however, the Company derives a portion of its revenue from export sales. The Company attributes sales to geographic areas based on the location of the customers. 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">732</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="10%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">984</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="40%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Totals</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;border-bottom-width:3px;border-bottom-color:#000000;border-bottom-style:double;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">$</td><td width="10%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Manufacturing&#160;and</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="27%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;border-bottom-width:1px;border-bottom-color:black;border-bottom-style:solid;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff" colspan="2" rowspan="1">Cable&#160;Assembly</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="12%" 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="27%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">Net sales</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">$</td><td width="11%" 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width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">29</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">400</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">700</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(1,358)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">(3,232)</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="27%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new 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style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:center;vertical-align:bottom;font-family:times new roman;font-size:10pt;font-weight:bold;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" 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width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">29</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">400</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr 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style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">700</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">-</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#ffffff">877</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td> </tr><tr style="height:12px;"> <td width="27%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">Total assets</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,297</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">11,910</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">6,853</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding-top:0px;padding-right:5px;padding-bottom:0px;padding-left:0px;;background-color:#cceeff">25,060</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#cceeff">&#160;</td> </tr><tr style="height:12px;"> <td width="27%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;text-align:left;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="11%" style="overflow:hidden;color:black;text-align:right;vertical-align:bottom;font-family:times new roman;font-size:10pt;padding:0px;;background-color:#ffffff">&#160;</td><td width="1%" style="overflow:hidden;color:black;vertical-align:top;font-family:times new 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Document And Entity Information - USD ($)
$ in Millions
12 Months Ended
Oct. 31, 2017
Jan. 22, 2018
Apr. 30, 2017
Document Information [Line Items]      
Document Type 10-K    
Amendment Flag false    
Document Period End Date Oct. 31, 2017    
Document Fiscal Year Focus 2017    
Document Fiscal Period Focus FY    
Entity Registrant Name R F INDUSTRIES LTD    
Entity Central Index Key 0000740664    
Current Fiscal Year End Date --10-31    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Filer Category Smaller Reporting Company    
Entity Public Float     $ 9.3
Trading Symbol RFIL    
Entity Common Stock, Shares Outstanding   8,872,246  
XML 17 R2.htm IDEA: XBRL DOCUMENT v3.8.0.1
CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
CURRENT ASSETS    
Cash and cash equivalents $ 6,039 $ 5,258
Trade accounts receivable, net of allowance for doubtful accounts of $73 and $62, respectively 3,901 4,077
Inventories 6,109 6,022
Other current assets 744 1,436
TOTAL CURRENT ASSETS 16,793 16,793
Property and equipment:    
Equipment and tooling 3,302 3,203
Furniture and office equipment 871 799
Property, Plant and Equipment, Gross 4,173 4,002
Less accumulated depreciation 3,462 3,174
Total property and equipment 711 828
Goodwill 3,219 3,219
Amortizable intangible assets, net 3,030 3,619
Non-amortizable intangible assets 1,237 1,237
Other assets 70 141
TOTAL ASSETS 25,060 25,837
CURRENT LIABILITIES    
Accounts payable 1,356 1,138
Accrued expenses 2,242 2,770
TOTAL CURRENT LIABILITIES 3,598 3,908
Deferred tax liabilities, net 119 409
Other long-term liabilities 0 128
TOTAL LIABILITIES 3,717 4,445
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY    
Common stock - authorized 20,000,000 shares of $0.01 par value; 8,872,246 and 8,835,483 shares issued and outstanding at October 31, 2017 and 2016, respectively 89 88
Additional paid-in capital 19,654 19,379
Retained earnings 1,600 1,925
TOTAL STOCKHOLDERS' EQUITY 21,343 21,392
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 25,060 $ 25,837
XML 18 R3.htm IDEA: XBRL DOCUMENT v3.8.0.1
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Trade accounts receivable, allowance for doubtful accounts $ 73 $ 62
Common stock, authorized 20,000,000 20,000,000
Common stock, par value $ 0.01 $ 0.01
Common stock, shares issued 8,872,246 8,835,483
Common stock, shares outstanding 8,872,246 8,835,483
XML 19 R4.htm IDEA: XBRL DOCUMENT v3.8.0.1
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Net sales $ 30,964 $ 30,241
Cost of sales 22,242 21,778
Gross profit 8,722 8,463
Operating expenses:    
Engineering 845 747
Selling and general 7,506 9,560
Goodwill and other intangible asset impairment 0 2,844
Total operating expense 8,351 13,151
Operating income (loss) 371 (4,688)
Other income 29 5
Income (loss) from continuing operations before provision (benefit) for income taxes 400 (4,683)
Provision (benefit) for income taxes 134 (652)
Income (loss) from continuing operations 266 (4,031)
Income (loss) from discontinued operations, net of tax 116 (58)
Consolidated net income (loss) $ 382 $ (4,089)
Earnings (loss) per share Basic    
Continuing operations $ 0.03 $ (0.46)
Discontinued operations 0.01 (0.01)
Net income (loss) per share 0.04 (0.47)
Earnings (loss) per share Diluted    
Continuing operations 0.03 (0.46)
Discontinued operations 0.01 (0.01)
Net income (loss) per share $ 0.04 $ (0.47)
Weighted average shares outstanding    
Basic 8,840,895 8,786,510
Diluted 8,915,764 8,786,510
XML 20 R5.htm IDEA: XBRL DOCUMENT v3.8.0.1
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-In Capital
Retained Earnings
Balance at Oct. 31, 2015 $ 26,371 $ 87 $ 19,129 $ 7,155
Balance (in shares) at Oct. 31, 2015   8,713,664    
Exercise of stock options 49 $ 2 47 0
Exercise of stock options (in shares)   180,067    
Excess tax benefit from exercise of stock options 154 $ 0 154 0
Stock-based compensation expense 206 0 206 0
Dividends (1,141) 0 0 (1,141)
Treasury stock purchased and retired (158) $ (1) (157) 0
Treasury stock purchased and retired (in shares)   (58,248)    
Net Income (loss) (4,089) $ 0 0 (4,089)
Balance at Oct. 31, 2016 21,392 $ 88 19,379 1,925
Balance (in shares) at Oct. 31, 2016   8,835,483    
Exercise of stock options 56 $ 1 55 0
Exercise of stock options (in shares)   36,763    
Excess tax benefit from exercise of stock options 6 $ 0 6 0
Stock-based compensation expense 214 0 214 0
Dividends (707) 0 0 (707)
Net Income (loss) 382 0 0 382
Balance at Oct. 31, 2017 $ 21,343 $ 89 $ 19,654 $ 1,600
Balance (in shares) at Oct. 31, 2017   8,872,246    
XML 21 R6.htm IDEA: XBRL DOCUMENT v3.8.0.1
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
OPERATING ACTIVITIES:    
Consolidated net income (loss) $ 382 $ (4,089)
Adjustments to reconcile consolidated net income (loss) to net cash provided by (used in) operating activities:    
Bad debt expense 11 9
Depreciation and amortization 877 1,036
Goodwill and other intangible asset impairment 0 2,844
Inventory write-downs 0 168
Gain (loss) on disposal of fixed assets 0 68
Stock-based compensation expense 214 206
Deferred income taxes (290) (307)
Excess tax benefit from stock-based compensation (6) (154)
Changes in operating assets and liabilities:    
Trade accounts receivable 165 (107)
Inventories (87) 417
Other current assets 698 (554)
Other long-term assets 71 (102)
Accounts payable 218 (355)
Accrued expenses (528) (98)
Other long-term liabilities (128) (249)
Net cash provided by (used in) operating activities 1,597 (1,267)
INVESTING ACTIVITIES:    
Proceeds from notes receivable from stockholder 0 67
Proceeds from sale of fixed assets 0 22
Proceeds from sale of inventory 0 321
Capital expenditures (171) (384)
Net cash (used in) provided by investing activities (171) 26
FINANCING ACTIVITIES:    
Proceeds from exercise of stock options 56 49
Purchases of treasury stock 0 (158)
Excess tax benefit from exercise of stock options 6 154
Dividends paid (707) (1,141)
Net cash used in financing activities (645) (1,096)
Net increase (decrease) in cash and cash equivalents 781 (2,337)
Cash and cash equivalents, beginning of year 5,258 7,595
Cash and cash equivalents, end of year 6,039 5,258
Supplemental cash flow information - income taxes paid 349 208
Supplemental schedule of noncash investing and financing activities:    
Retirement of treasury stock $ 0 $ 157
XML 22 R7.htm IDEA: XBRL DOCUMENT v3.8.0.1
Business activities and summary of significant accounting policies
12 Months Ended
Oct. 31, 2017
Accounting Policies [Abstract]  
Business activities and summary of significant accounting policies
Note 1 - Business activities and summary of significant accounting policies
 
Business activities
 
RF Industries, Ltd., together with its three wholly-owned subsidiaries (collectively, hereinafter the “Company”), primarily engages in the design, manufacture, and marketing of interconnect products and systems, including coaxial and specialty cables, fiber optic cables and connectors, and electrical and electronic specialty cables. For internal operating and reporting purposes, and for marketing purposes, as of the end of the fiscal year ended October 31, 2017 the Company classified its operations into the following four divisions/subsidiaries: (i) The RF Connector and Cable Assembly division designs, manufactures and distributes coaxial connectors and cable assemblies that are integrated with coaxial connectors; (ii) Cables Unlimited, Inc., the subsidiary that manufactures custom and standard cable assemblies, complex hybrid fiber optic power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive and medical equipment; (iii) Comnet Telecom Supply, Inc., the subsidiary that manufactures and sells fiber optics cable, distinctive cabling technologies and custom patch cord assemblies, as well as other data center products; and (iv) Rel-Tech Electronics, Inc., the subsidiary that designs and manufacturers of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers. Both the Cables Unlimited division and the Comnet Telecom division are Corning Cables Systems CAH Connections SM Gold Program members that are authorized to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems’ extended warranty. During the fiscal year ended October 31, 2016, RF Industries, Ltd. sold the Aviel Electronics division that designed, manufactured and distributed specialty and custom RF connectors, and discontinued the Bioconnect division that manufactured and distributed cabling and interconnect products to the medical monitoring market.
 
Use of estimates 
 
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results may differ from those estimates.
 
Principles of consolidation
 
The accompanying consolidated financial statements include the accounts of RF Industries, Ltd., Cables Unlimited, Inc. (“Cables Unlimited”), Comnet Telecom Supply, Inc. (“Comnet”), and Rel-Tech Electronics, Inc. (“Rel-Tech”), wholly-owned subsidiaries of RF Industries, Ltd. All intercompany balances and transactions have been eliminated in consolidation.
 
Cash equivalents
 
The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.
 
Revenue recognition
 
Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and for shipments with terms of FOB Shipping Point, revenue is recognized upon shipment, for shipments with terms of FOB Destination, revenue is recognized upon delivery and revenue from services is recognized when services are performed, and the recovery of the consideration is considered probable.
 
Inventories
 
Inventories are stated at the lower of cost or market, with cost determined using the weighted average cost of accounting. Cost includes materials, labor, and manufacturing overhead related to the purchase and production of inventories. We regularly review inventory quantities on hand, future purchase commitments with our suppliers, and the estimated utility of our inventory. If our review indicates a reduction in utility below carrying value due to damage, physical deterioration, obsolescence, changes in price levels, or other causes, we reduce our inventory to a new cost basis through a charge to cost of sales in the period in which it occurs. The determination of market value and the estimated volume of demand used in the lower of cost or market analysis requires significant judgment.
 
In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech prospectively values its inventories cost using the weighted average cost of accounting.
 
Property and equipment
 
Equipment, tooling and furniture are recorded at cost and depreciated over their estimated useful lives (generally 3 to 5 years) using the straight-line method. Expenditures for repairs and maintenance are charged to operations in the period incurred.
 
Goodwill
 
Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Goodwill is not amortized, but is subject to impairment analysis at least once annually, which the Company performs in October, or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value.
 
We assess whether a goodwill impairment exists using both qualitative and quantitative assessments at the reporting level. Our qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we will not perform a quantitative assessment.
 
If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if we elect not to perform a qualitative assessment, we perform a quantitative assessment, or two-step impairment test, to determine whether a goodwill impairment exists at the reporting unit. The first step in our quantitative assessment identifies potential impairments by comparing the estimated fair value of the reporting unit to its carrying value, including goodwill (“Step 1”). If the carrying value exceeds estimated fair value, there is an indication of potential impairment and the second step is performed to measure the amount of impairment (“Step 2”).
 
For the fiscal year 2016, Cables Unlimited did not meet its sales volume and revenue goals, and the mix of product sold had lower margins than planned. These results, along with changes in the competitive marketplace and an evaluation of business priorities, led to a shift in strategic direction and reduced future revenue and profitability expectations for the business. The results of these changes and circumstances lead to the determination that Cables Unlimited did not pass our qualitative assessment and therefore a quantitative assessment was required.
 
Upon completion of our Step 1 test, we found that the results indicated that Cables Unlimited’s carrying value exceeded its estimated fair value, and as a result, the Step 2 test was performed specific to Cables Unlimited. Under Step 2, the fair value of all assets and liabilities were estimated, including customer list and backlog, for the purpose of deriving an estimate of the fair value of goodwill. The fair value of the goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Assumptions used in measuring the value of these assets and liabilities included the discount rates used in valuing the intangible assets, and consideration of the market environment in valuing the tangible assets.
 
Upon completion of our Step 2 test, our Cables Unlimited division’s goodwill was determined to be impaired. As of October 31, 2016, the Company recorded a $2.6 million impairment charge to goodwill. Cables Unlimited’s goodwill is included in the Custom Cabling Manufacturing and Assembly segment.
 
No other instances of impairment were identified as of October 31, 2016 and no instances of goodwill impairment were identified during the year ended October 31, 2017.
 
On June 15, 2011, the Company completed its acquisition of Cables Unlimited. Goodwill related to this acquisition is included within the Cables Unlimited reporting unit. Effective November 1, 2014, the Company also completed its acquisition of Comnet. Goodwill related to this acquisition is included within the Comnet reporting unit. As of May 19, 2015, the Company completed its acquisition of the CompPro product line. Goodwill related to this acquisition is included within the Connector and Cable Assembly Division. Effective June 1, 2015, the Company completed its acquisition of Rel-Tech. Goodwill related to this acquisition is included within the Rel-Tech reporting unit.
 
Long-lived assets
 
The Company assesses property, plant and equipment and intangible assets, which are considered definite-lived assets for impairment. Definite-lived assets are reviewed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. The Company has made no material adjustments to our long-lived assets in any of the years presented.
 
The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment.
 
In addition, the Company tests our trademarks and indefinite-lived asset for impairment at least annually or more frequently if events or changes in circumstances indicate that these assets may be impaired.
 
In 2016, upon completion of our Step 2 test (see “Goodwill” above), our Cables Unlimited division’s trademark was determined to be impaired. As of October 31, 2016, the Company recorded a $150,000 impairment charge to its trademark. Cables Unlimited’s trademark is included in the Custom Cabling Manufacturing and Assembly segment.
 
No instances of impairment were identified as of October 31, 2017 and no other instances of impairment were identified as of October 31, 2016.
 
Earn-out liability
 
The purchase agreement for the Rel-Tech acquisition provides for earn-out payments of up to $800,000 in the aggregate, last installment of which is payable May 31, 2018. The initial earn-out liability was valued at its fair value using the Monte Carlo simulation and is included as a component of the total purchase price. The earn-out was and will continue to be revalued quarterly using a present value approach and any resulting increase or decrease will be recorded into selling and general expenses. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. Significant judgment is employed in determining the appropriateness of the assumptions used in calculating the fair value of the earn-out as of the acquisition date. Accordingly, significant variances between actual and forecasted results or changes in the assumptions can materially impact the amount of contingent consideration expense we record in future periods.
 
The Company measures at fair value certain financial assets and liabilities. U. S. GAAP specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. These two types of inputs have created the following fair-value hierarchy:
 
Level 1— Quoted prices for identical instruments in active markets;
 
Level 2— Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
 
Level 3— Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
 
The contingent consideration liability represents future earn-out liability that we may be required to pay in conjunction with the acquisition of Rel-Tech and Comnet. The Company estimates the fair value of the earn-out liability using a probability-weighted scenario of estimated qualifying earn-out gross profit related to Rel-Tech and EBITDA related to Comnet calculated at net present value (level 3 of the fair value hierarchy).
 
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2017 (in thousands):
 
Description Level 1 Level 2 Level 3 
Earn-out liability $- $- $236 
 
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in thousands):
 
Description Level 1 Level 2 Level 3 
Earn-out liability $- $- $835 
 
The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):
 
  Level 3 
  2017 2016 
Beginning balance $835 $1,527 
Payments  (578)  (790) 
Change in value  (21)  98 
Ending Balance $236 $835 
 
Intangible assets
 
Intangible assets consist of the following as of October 31 (in thousands): 
 

  2017 2016 
Amortizable intangible assets:       
Non-compete agreements (estimated lives 3 - 5 years) $310 $310 
Accumulated amortization  (310)  (273) 
   -  37 
        
Customer relationships (estimated lives 7 - 15 years)  5,099  5,099 
Accumulated amortization  (2,186)  (1,644) 
   2,913  3,455 
        
Patents (estimated life 14 years)  142  142 
Accumulated amortization  (25)  (15) 
   117  127 
        
Totals $3,030 $3,619 
        
Non-amortizable intangible assets:       
Trademarks $1,237 $1,237 
 
Amortization expense for the years ended October 31, 2017 and 2016 was $589,000 and $649,000, respectively.
 
Impairment to trademarks for the years ended October 31, 2017 and 2016 was $0 and $150,000, respectively.
 
Estimated amortization expense related to finite lived intangible assets is as follows (in thousands):
 
Year ending    
October 31, Amount 
     
2018 $553 
2019  553 
2020  553 
2021  413 
2022  413 
Thereafter  545 
Total $3,030 
 
Advertising
 
The Company expenses the cost of advertising and promotions as incurred. Advertising costs charged to operations were approximately $130,000 and $156,000 in 2017 and 2016, respectively.
 
Research and development
 
Research and development costs are expensed as incurred. The Company’s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively.
 
Income taxes
 
The Company accounts for income taxes under the asset and liability method, based on the income tax laws and rates in the jurisdictions in which operations are conducted and income is earned. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Developing the provision (benefit) for income taxes requires significant judgment and expertise in federal, international and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Management’s judgments and tax strategies are subject to audit by various taxing authorities.
 
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense.
 
Stock options
 
For stock option grants to employees, the Company recognizes compensation expense based on the estimated fair value of the options at the date of grant. Stock-based employee compensation expense is recognized on a straight-line basis over the requisite service period. The Company issues previously unissued common shares upon the exercise of stock options.
 
For the fiscal years ended October 31, 2017 and 2016, charges related to stock-based compensation amounted to approximately $214,000 and $206,000, respectively. For the fiscal years ended October 31, 2017 and 2016, stock-based compensation classified in cost of sales amounted to $13,000 and $28,000 and stock-based compensation classified in selling and general and engineering expense amounted to $201,000 and $178,000, respectively.
 
Earnings (loss) per share
 
Basic earnings (loss) per share is calculated by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the period. The calculation of diluted earnings (loss) per share is similar to that of basic earnings (loss) per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all potentially dilutive common shares, principally those issuable upon the exercise of stock options, were issued and the treasury stock method had been applied during the period. The greatest number of shares potentially issuable by the Company upon the exercise of stock options in any period for the years ended October 31, 2017 and 2016, that were not included in the computation because they were anti-dilutive, totaled 737,512 and 824,441, respectively.
 
The following table summarizes the computation of basic and diluted earnings (loss) per share:
 
  2017 2016 
Numerators:       
Consolidated net income (loss) (A) $382,000 $(4,089,000) 
        
Denominators:       
Weighted average shares outstanding for basic earnings (loss) per share (B)  8,840,895  8,786,510 
Add effects of potentially dilutive securities - assumed exercise of stock options  74,869  - 
        
Weighted average shares outstanding for diluted earnings (loss) per share (C)  8,915,764  8,786,510 
        
Basic earnings (loss) per share (A)/(B) $0.04 $(0.47) 
        
Diluted earnings (loss) per share (A)/(C) $0.04 $(0.47) 
 
Recent accounting standards
 
Recently issued accounting pronouncements not yet adopted:
 
In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. The new standard will change the classification of certain cash payments and receipts within the cash flow statement. Specifically, payments for debt prepayment or debt extinguishment costs, including third-party costs, premiums paid, and other fees paid to lenders that are directly related to the debt prepayment or debt extinguishment, excluding accrued interest, will now be classified as financing activities. Previously, these payments were classified as operating expenses. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019, with early adoption permitted, and will be applied retrospectively. The Company does not expect that the adoption of this new standard will have a material impact on its Consolidated Financial Statements.
 
In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. This ASU requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The ASU also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.
 
In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation – Stock Compensation. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. The new standard is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements effective for the quarter ending January 31, 2018.
 
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. This guidance will supersede Topic 605, Revenue Recognition, in addition to other industry-specific guidance, once effective. The new standard requires a company to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services.  In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, as a revision to ASU 2014-09, which revised the effective date to fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted but not prior to periods beginning after December 15, 2016 (i.e., the original adoption date per ASU 2014-09). In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations, which clarifies certain aspects of the principal-versus-agent guidance, including how an entity should identify the unit of accounting for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments also reframe the indicators to focus on evidence that an entity is acting as a principal rather than as an agent. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property, which will determine whether it recognizes revenue over time or at a point in time. The amendments also clarify when a promised good or service is separately identifiable (i.e., distinct within the context of the contract) and allow entities to disregard items that are immaterial in the context of a contract. The Company continues to assess the impact this new standard may have on its ongoing financial reporting. The Company has identified its revenue streams both by contract and product type and is assessing each for potential impacts. For the revenue streams assessed, the Company does not anticipate a material impact in the timing or amount of revenue recognized.
 
In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles-Goodwill and Other, which simplifies the accounting for goodwill impairments by eliminating step 2 from the goodwill impairment test. Instead, if “the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.” The guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.
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Discontinued operations
12 Months Ended
Oct. 31, 2017
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued operations
Note 2 - Discontinued operations
 
During 2013, the Company sold its RF Neulink and RadioMobile divisions, which together had comprised the Company’s RF Wireless segment. The divisions were sold pursuant to asset purchase agreements, whereby no purchase price was paid at the closing. Rather, the agreements stipulated royalty payments from each of the purchasers over a three-year period. For the years ended October 31, 2017 and 2016, the Company recognized approximately $174,000 and $57,000, respectively, of aggregate royalty income for RF Neulink and RadioMobile, which amounts have been included within discontinued operations.
 
During March 2016, the Company announced the shutdown of its Bioconnect division, which comprised the entire operations of the Medical Cabling and Interconnect segment. The closure is part of the Company’s ongoing plan to close or dispose of underperforming divisions that are not part of the Company’s core operations. For the year ended October 31, 2017, the Company recognized approximately $10,000 of income related to the sale of equipment for the Bioconnect division, which amounts have been included within discontinued operations. For the year ended October 31, 2016, the Company recognized approximately $148,000 of loss for the Bioconnect division, which amounts have been included within discontinued operations. Included in the fiscal year 2016 loss, the Company recognized a $148,000 pretax write-down on Bioconnect division’s inventory and fixed assets.
 
The following summarized financial information related to the RF Neulink, RadioMobile and Bioconnect divisions is segregated from continuing operations and reported as discontinued operations for the years ended October 31, 2017 and 2016 (in thousands):
 
  2017 2016 
        
Royalties $174 $57 
Bioconnect  10  (148) 
Provision (benefit) for income taxes  68  (33) 
Income (loss) from discontinued operations, net of tax $116 $(58) 
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Concentrations of credit risk
12 Months Ended
Oct. 31, 2017
Risks and Uncertainties [Abstract]  
Concentrations of credit risk
Note 3 - Concentrations of credit risk
 
Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. At October 31, 2017, the Company had cash and cash equivalent balances in excess of federally insured limits in the amount of approximately $5.2 million.
 

Two customers accounted for approximately 20% and 11% of the Company’s net sales for the fiscal year ended October 31, 2017, and one customer accounted for approximately 15% of the Company’s net sales for the fiscal year ended October 31, 2016. At October 31, 2017 these customers’ accounts receivable balance accounted for approximately 27% and 5% of the Company’s total net accounts receivable balances, and at October 31, 2016, this customer’s accounts receivable balance accounted for approximately 20% of the Company’s total net accounts receivable balance.  Although these customers have been on-going major customers of the Company continuously in the past, the written agreements with these customers do not have any minimum purchase obligations and the customers could stop buying the Company’s products at any time and for any reason. A reduction, delay or cancellation of orders from these customers or the loss of these customers could significantly reduce the Company’s future revenues and profits.
 
There was no product line that was significant for the fiscal years ended October 31, 2017 and 2016.
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Inventories and major vendors
12 Months Ended
Oct. 31, 2017
Inventory Disclosure [Abstract]  
Inventories and major vendors
Note 4 - Inventories and major vendors
 
Inventories, consisting of materials, labor and manufacturing overhead, are stated at the lower of cost or market. Cost has been determined using the weighted average cost method. In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech values its inventory cost using the weighted average cost of accounting. Inventories consist of the following (in thousands): 
 
  2017 2016 
        
Raw materials and supplies $2,520 $2,642 
Work in process  194  279 
Finished goods  3,395  3,101 
        
Totals $6,109 $6,022 
 
Purchases of inventory from two major vendors during fiscal 2017 represented 7% and 5%, respectively, of total inventory purchases compared to two major vendors who represented 9% and 6%, respectively, of total inventory purchases in fiscal 2016. The Company has arrangements with these vendors to purchase product based on purchase orders periodically issued by the Company.
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Other current assets
12 Months Ended
Oct. 31, 2017
Other current assets [Abstract]  
Other current assets
Note 5 - Other current assets
 
Other current assets consist of the following (in thousands): 
 
  2017 2016 
        
Prepaid taxes $20 $871 
Prepaid expense  526  347 
Notes receivable, current portion  83  83 
Other  115  135 
        
Totals $744 $1,436 
 
Long-term portion of notes receivable of zero and $21,000 is recorded in other assets as of October 31, 2017 and 2016, respectively.
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Accrued expenses and other long-term liabilities
12 Months Ended
Oct. 31, 2017
Payables and Accruals [Abstract]  
Accrued expenses
Note 6 - Accrued expenses and other long-term liabilities
 
Accrued expenses consist of the following (in thousands):
 
  2017 2016 
        
Wages payable $855 $941 
Accrued receipts  695  578 
Earn-out liability  236  707 
Other current liabilities  456  544 
        
Totals $2,242 $2,770 
 
Accrued receipts represent purchased inventory for which invoices have not been received.
 
The non-current portion of the earn-out liability of $128,000 is recorded in other long-term liabilities as of October 31, 2016
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Segment information
12 Months Ended
Oct. 31, 2017
Segment Reporting [Abstract]  
Segment information
Note 7 - Segment information
 
 
 
The Company aggregates operating divisions into operating segments which have similar economic characteristics primarily in the following areas: (1) the nature of the product and services; (2) the nature of the production process; (3) the type or class of customer for their products and services; (4) the methods used to distribute their products or services; and (5) if applicable, the nature of the regulatory environment. As of October 31, 2017, the Company had two segments - RF Connector and Cable Assembly
,
and Custom Cabling Manufacturing based upon this evaluation.
 
The RF Connector and Cable Assembly segment is comprised of one division, while the Custom Cabling Manufacturing and Assembly segment comprised of three divisions. The four divisions that met the quantitative thresholds for segment reporting are Connector and Cable Assembly, Cables Unlimited, Comnet and Rel-Tech. The specific customers are different for each division; however, there is some overlapping of product sales to them. The methods used to distribute products are similar within each division aggregated.
 
Management identifies the Company’s segments based on strategic business units that are, in turn, based along market lines. These strategic business units offer products and services to different markets in accordance with their customer base and product usage. For segment reporting purposes, the RF Connector and Cable Assembly division constitutes the RF Connector and Cable Assembly segment
, and
the Cables Unlimited, Comnet and Rel-Tech division
constitute
the Custom Cabling Manufacturing segment.
 
As reviewed by the Company’s chief operating decision maker, the Company evaluates the performance of each segment based on income or loss before income taxes. The Company charges depreciation and amortization directly to each division within the segment. Accounts receivable, inventory, property and equipment, goodwill and intangible assets are the only assets identified by segment. Except as discussed above, the accounting policies for segment reporting are the same for the Company as a whole.
 
Substantially all of the Company’s operations are conducted in the United States; however, the Company derives a portion of its revenue from export sales. The Company attributes sales to geographic areas based on the location of the customers. The following table presents the sales of the Company by geographic area for the years ended October 31, 2017 and 2016 (in thousands):
 
  2017 2016 
        
United States $30,232 $29,257 
Foreign Countries:       
Canada  483  509 
Israel  -  63 
Mexico  78  234 
All Other  171  178 
   732  984 
        
Totals $30,964 $30,241 
 
Net sales, income (loss) from continuing operations before provision (benefit) for income taxes and other related segment information for the years ended October 31, 2017 and 2016 are as follows (in thousands): 
 
  RF Connector Custom Cabling       
  and Manufacturing and       
  Cable Assembly Assembly Corporate Total 
2017             
Net sales $11,456 $19,508 $- $30,964 
Income (loss) from continuing operations before provision (benefit) for income taxes  382  (11)  29  400 
Depreciation and amortization  177  700  -  877 
Total assets  6,297  11,910  6,853  25,060 
              
2016             
Net sales $9,352 $20,889 $- $30,241 
Loss from continuing operations before provision (benefit) for income taxes  (1,358)  (3,232)  (93)  (4,683) 
Depreciation and amortization  194  842  -  1,036 
Total assets  5,902  13,100  6,835  25,837 
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Income tax provision
12 Months Ended
Oct. 31, 2017
Income Tax Disclosure [Abstract]  
Income tax provision
Note 8 - Income tax provision
 
The provision (benefit) for income taxes for the fiscal years ended October 31, 2017 and 2016 consists of the following (in thousands):
 
  2017 2016 
Current:       
Federal $400 $(332) 
State  24  (13) 
   424  (345) 
        
Deferred:       
Federal  (293)  (179) 
State  3  (128) 
   (290)  (307) 
        
  $134 $(652) 
 
Income tax at the federal statutory rate is reconciled to the Company’s actual net provision (benefit) for income taxes as follows (in thousands, except percentages):
 
  2017 2016 
     % of Pretax    % of Pretax 
  Amount Income Amount Income 
              
Income taxes at federal statutory rate $136  34.0%$(1,592)  34.0%
State tax provision, net of federal tax benefit  16  4.0% (53)  1.1%
Nondeductible differences:             
Goodwill and other intangible asset impairment  -  0.0% 916  -19.6%
Rel-Tech earn-out  (9)  -2.3% 52  -1.1%
Qualified domestic production activities deduction  (66)  -16.5% 46  -1.0%
ISO stock options  33  8.3% 52  -1.1%
Meals and entertainment  21  5.3% 29  -0.6%
Temporary true-ups  26  6.4% -  0.0%
State tax refunds, net of federal expense  (4)  -0.8% (38)  0.8%
R&D credits  (37)  -9.3% (46)  1.0%
Other  18  4.4% (18)  0.4%
  $134  33.5%$(652)  13.9%
 
The Company’s total deferred tax assets and deferred tax liabilities at October 31, 2017 and 2016 are as follows (in thousands):
 
  2017 2016 
        
Deferred Tax Assets:       
Reserves $375 $216 
Accrued vacation  122  134 
Stock-based compensation awards  184  159 
Uniform capitalization  130  148 
Other  70  43 
Total deferred tax assets  881  700 
        
Deferred Tax Liabilities:       
Amortization / intangible assets  (805)  (864) 
Depreciation / equipment and furnishings  (195)  (211) 
Other  -  (34) 
Total deferred tax liabilities  (1,000)  (1,109) 
        
Total net deferred tax assets (liabilities) $(119) $(409) 
 
Deferred income tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has evaluated the available evidence supporting the realization of its gross deferred tax assets, including the amount and timing of future taxable income, and has determined it is more likely than not that the assets will be realized in future tax years.
 
The Company had adopted the provisions of ASC 740-10, which clarifies the accounting for uncertain tax positions. ASC 740-10 requires that the Company recognize the impact of a tax position in the financial statements if the position is not more likely than not to be sustained upon examination based on the technical merits of the position. The Company’s practice is to recognize interest and penalties related to income tax matters in income from continuing operations. The Company has no material unrecognized tax benefits as of October 31, 2017.
 
The Company is subject to taxation in the United States and state jurisdictions. The Company’s tax years for October 31, 2014 and forward are subject to examination by the United States and October 31, 2013 and forward with state tax authorities.
 
On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into United States tax law, which among other provisions will lower the corporate tax rate to 21%. Given this date of enactment, our
consolidated 
financial statements
as of and 
for the year ended October 31, 2017 do not reflect the impact of the Act. The Company is in the process of analyzing the potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the law was enacted.
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Stock options
12 Months Ended
Oct. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-based compensation and equity transactions
Note 9 - Stock options
 
Incentive and non-qualified stock option plans
 
On March 9, 2010, the Company’s Board of Directors adopted the RF Industries, Ltd. 2010 Stock Incentive Plan (the “2010 Plan”). In June 2010, the Company’s stockholders approved the 2010 Plan by vote as required by NASDAQ. An aggregate of 1,000,000 shares of common stock was set aside and reserved for issuance under the 2010 Plan. The Company’s stockholders approved the issuance of an additional 500,000 shares of common stock at its annual meeting held on September 5, 2014, another 500,000 shares of common stock at its annual meeting held September 4, 2015 and another 1,000,000 shares of common stock at its annual meeting held September 8, 2017. As of October 31, 2017, 1,726,138 shares of common stock were remaining for future grants of stock options under the 2010 Plan.
 
Additional disclosures related to stock option plans 
 
The fair value of each option granted in 2017 and 2016 was estimated on the grant date using the Black-Scholes option pricing model with the following assumptions:
 
  2017  2016 
Weighted average volatility  43.3%  28.7%
Expected dividends  5.0%  2.4%
Expected term (in years)  4.3   3.0 
Risk-free interest rate  1.20%  0.70%
Weighted average fair value of options granted during the year $0.39  $0.66 
Weighted average fair value of options vested during the year $1.95  $4.36 
 
Expected volatilities are based on historical volatility of the Company’s stock price and other factors. The Company used the historical method to calculate the expected life of the 2017 option grants. The expected life represents the period of time that options granted are expected to be outstanding. The risk-free rate is based on the U.S. Treasury rate with a maturity date corresponding to the options’ expected life. The dividend yield is based upon the historical dividend yield.
 
Additional information regarding all of the Company's outstanding stock options at October 31, 2017 and 2016 and changes in outstanding stock options in 2017 and 2016 follows:
 
  2017 2016 
  Shares or Weighted Shares or Weighted 
  Price Per Average Price Per Average 
  Share Exercise Price Share Exercise Price 
Options outstanding at beginning of year  1,007,851 $4.07  1,240,100 $3.64 
Options granted  449,068 $1.61  104,936 $3.36 
Options exercised  (36,763) $1.50  (180,067) $0.27 
Options forfeited  (260,385) $4.10  (157,118) $4.53 
Options outstanding at end of year  1,159,771 $3.19  1,007,851 $4.07 
              
Options exercisable at end of year  926,272 $3.08  724,457 $3.93 
              
Options vested and expected to vest at end of year  1,159,002 $3.19  1,002,522 $4.07 
              
Option price range at end of year $ 1.07 - $6.91     $ 2.30 - $6.91     
              
Aggregate intrinsic value of options exercised during year $55,000    $456,000    
 
Weighted average remaining contractual life of options outstanding as of October 31, 2017: 4.19 years
 
Weighted average remaining contractual life of options exercisable as of October 31, 2017: 3.18 years
 
Weighted average remaining contractual life of options vested and expected to vest as of October 31, 2017: 4.19 years
 
Aggregate intrinsic value of options outstanding at October 31, 2017: $552,000
 
Aggregate intrinsic value of options exercisable at October 31, 2017: $503,000
 
Aggregate intrinsic value of options vested and expected to vest at October 31, 2017: $552,000
 
As of October 31, 2017, $275,000 of expense with respect to nonvested share-based arrangements has yet to be recognized which is expected to be recognized over a weighted average period of 6.33 years.
 
Effective for the fiscal year ending October 31, 2017, non-employee directors receive $50,000 annually, which is paid one-half in cash and one-half through the grant of non-qualified stock options to purchase shares of the Company’s common stock. Previously, for the fiscal year ended October 31, 2016, non-employee directors received $30,000 annually. During the quarter ended January 31, 2017, the Company granted each of its four non-employee directors 77,339 options. The number of stock options granted to each director was determined by dividing $25,000 by the fair value of a stock option grant using the Black-Scholes model ($0.32 per share). These options vest ratably over fiscal year 2017. On June 9, 2017, the Company’s Board of Directors appointed Gerald Garland to serve as a director. Mr. Garland received a prorated portion of the compensation paid by the Company. The number of stock options granted to Mr. Garland was determined by dividing $9,863 (the portion of his director fee for the year ending October 31, 2017) by the fair value of a stock option grant using the Black-Scholes model ($0.40 per share). These options vest ratably over the remaining portion of fiscal year 2017.
 
On April 6, 2016, Howard Hill, the Company’s former Chief Operating Officer, retired from the Company. On becoming a non-employee member of the Board on April 7, 2016, Mr. Hill was granted 33,744 options, representing the director compensation payable to him for his services for the remainder of the 2016 fiscal year. The number of stock options granted was determined by dividing his pro-rata portion of his stock based compensation for serving on the Board of $8,750 by the fair value of a stock option grant using the Black-Scholes model ($0.26). These options vested ratably over fiscal 2016.
XML 31 R16.htm IDEA: XBRL DOCUMENT v3.8.0.1
Retirement plan
12 Months Ended
Oct. 31, 2017
Compensation and Retirement Disclosure [Abstract]  
Retirement plan
Note 10 - Retirement plan
 
The Company has a 401(K) plan available to its employees. For the years ended October 31, 2017 and 2016, the Company contributed and recognized as an expense $166,000 and $182,000, respectively, which amount represented 3% of eligible employee earnings under its Safe Harbor Non-elective Employer Contribution Plan.
XML 32 R17.htm IDEA: XBRL DOCUMENT v3.8.0.1
Related party transactions
12 Months Ended
Oct. 31, 2017
Related Party Transactions [Abstract]  
Related party transactions
Note 11 - Related party transactions
 
During fiscal 2016 the Company had a note receivable from stockholder of $67,000 that was due from a former Chief Executive Officer of the Company, earned interest at 6% per annum (which interest was payable annually), and had no specific due date. The note was collateralized by property owned by the former Chief Executive Officer. During fiscal 2016, the former Chief Executive Officer resigned as an employee of the Company and, in connection with his resignation, repaid the foregoing promissory note in full.
 
On June 15, 2011, the Company purchased Cables Unlimited, Inc., a New York corporation, from Darren Clark, the sole shareholder of Cables Unlimited, Inc. In connection with the purchase of Cables Unlimited, the Company entered into a lease for the New York facilities from which Cables Unlimited conducts its operations. Cables Unlimited’s monthly rent expense under the lease is $13,000 per month, plus payments of all utilities, janitorial expenses, routine maintenance costs, and costs of insurance for Cables Unlimited’s business operations and equipment. During the fiscal year ended October 31, 2017, the Company paid the landlord a total of $156,000 under the lease. The owner and landlord of the facility is a company controlled by Darren Clark, the former owner of Cables Unlimited and the current President of this subsidiary of the Company.
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Cash dividend and declared dividends
12 Months Ended
Oct. 31, 2017
Cash Dividend And Dividends Declaration [Abstract]  
Cash dividend and declared dividends
Note 12 - Cash dividend and declared dividends
 
The Company paid quarterly dividends of $0.02 per share during fiscal year 2017 for a total of $707,000. The Company paid quarterly dividends of $0.02, $0.02, $0.02 and $0.07 per share during the three months ended October, 31, 2016, July 31, 2016, April 30, 2016 and January 31, 2016, respectively, for a total of $1.1 million.
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Commitments
12 Months Ended
Oct. 31, 2017
Commitments and Contingencies Disclosure [Abstract]  
Commitments
Note 13 - Commitments
 
As of October 31, 2017, the Company leases its facilities in San Diego, California, Yaphank, New York, Milford, Connecticut and East Brunswick, New Jersey under non-cancelable operating leases. Deferred rents, included in accrued expenses and other long-term liabilities, were $95,000 as of October 31, 2017 and $3,000 as of October 31, 2016. The San Diego lease also requires the payment of the Company's pro rata share of the real estate taxes and insurance, maintenance and other operating expenses related to the facilities.
 
Rent expense under all operating leases totaled approximately $644,000 and $628,000 in 2017 and 2016, respectively.
 
Minimum lease payments under these non-cancelable operating leases in each of the years subsequent to October 31, 2017 are as follows (in thousands):
 
Year ending    
October 31, Amount 
     
2018 $645 
2019  516 
2020  441 
2021  440 
2022  359 
Total $2,401 
XML 35 R20.htm IDEA: XBRL DOCUMENT v3.8.0.1
Line of credit
12 Months Ended
Oct. 31, 2017
Debt Disclosure [Abstract]  
Line of credit
 
Note 14 - Line of credit
 
From May 2015 until September 2016, the Company had a $5 million line of credit available to it from its bank. The Company did not use the line of credit and, effective September 8, 2016, the Company terminated the line of credit.
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Subsequent events
12 Months Ended
Oct. 31, 2017
Subsequent Events [Abstract]  
Subsequent events
Note 15 - Subsequent events
 
On December 13, 2017, the Board of Directors of the Company declared a quarterly dividend of $0.02 per share that was paid on January 15, 2018 to stockholders of record on December 31, 2017.
 
On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into United States tax law, which among other provisions will lower the corporate tax rate to 21%. Given this date of enactment, our financial statements for the year ended October 31, 2017 do not reflect the impact of the Act. The Company is in the process of analyzing the potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the law was enacted.
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Business activities and summary of significant accounting policies (Policies)
12 Months Ended
Oct. 31, 2017
Accounting Policies [Abstract]  
Business activities
Business activities
 
RF Industries, Ltd., together with its three wholly-owned subsidiaries (collectively, hereinafter the “Company”), primarily engages in the design, manufacture, and marketing of interconnect products and systems, including coaxial and specialty cables, fiber optic cables and connectors, and electrical and electronic specialty cables. For internal operating and reporting purposes, and for marketing purposes, as of the end of the fiscal year ended October 31, 2017 the Company classified its operations into the following four divisions/subsidiaries: (i) The RF Connector and Cable Assembly division designs, manufactures and distributes coaxial connectors and cable assemblies that are integrated with coaxial connectors; (ii) Cables Unlimited, Inc., the subsidiary that manufactures custom and standard cable assemblies, complex hybrid fiber optic power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive and medical equipment; (iii) Comnet Telecom Supply, Inc., the subsidiary that manufactures and sells fiber optics cable, distinctive cabling technologies and custom patch cord assemblies, as well as other data center products; and (iv) Rel-Tech Electronics, Inc., the subsidiary that designs and manufacturers of cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation and military customers. Both the Cables Unlimited division and the Comnet Telecom division are Corning Cables Systems CAH Connections SM Gold Program members that are authorized to manufacture fiber optic cable assemblies that are backed by Corning Cables Systems’ extended warranty. During the fiscal year ended October 31, 2016, RF Industries, Ltd. sold the Aviel Electronics division that designed, manufactured and distributed specialty and custom RF connectors, and discontinued the Bioconnect division that manufactured and distributed cabling and interconnect products to the medical monitoring market.
Use of estimates
Use of estimates 
 
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results may differ from those estimates.
Principles of consolidation
Principles of consolidation
 
The accompanying consolidated financial statements include the accounts of RF Industries, Ltd., Cables Unlimited, Inc. (“Cables Unlimited”), Comnet Telecom Supply, Inc. (“Comnet”), and Rel-Tech Electronics, Inc. (“Rel-Tech”), wholly-owned subsidiaries of RF Industries, Ltd. All intercompany balances and transactions have been eliminated in consolidation.
Cash equivalents
Cash equivalents
 
The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.
Revenue recognition
Revenue recognition
 
Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. The Company recognizes revenue from product sales after purchase orders are received which contain a fixed price and for shipments with terms of FOB Shipping Point, revenue is recognized upon shipment, for shipments with terms of FOB Destination, revenue is recognized upon delivery and revenue from services is recognized when services are performed, and the recovery of the consideration is considered probable.
Inventories
Inventories
 
Inventories are stated at the lower of cost or market, with cost determined using the weighted average cost of accounting. Cost includes materials, labor, and manufacturing overhead related to the purchase and production of inventories. We regularly review inventory quantities on hand, future purchase commitments with our suppliers, and the estimated utility of our inventory. If our review indicates a reduction in utility below carrying value due to damage, physical deterioration, obsolescence, changes in price levels, or other causes, we reduce our inventory to a new cost basis through a charge to cost of sales in the period in which it occurs. The determination of market value and the estimated volume of demand used in the lower of cost or market analysis requires significant judgment.
 
In June 2015, the Company acquired Rel-Tech, a company that valued its inventories using specific identification (last purchase price) on a FIFO basis. As of July 31, 2016, Rel-Tech prospectively values its inventories cost using the weighted average cost of accounting.
Property and equipment
Property and equipment
 
Equipment, tooling and furniture are recorded at cost and depreciated over their estimated useful lives (generally 3 to 5 years) using the straight-line method. Expenditures for repairs and maintenance are charged to operations in the period incurred.
Goodwill
Goodwill
 
Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Goodwill is not amortized, but is subject to impairment analysis at least once annually, which the Company performs in October, or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value.
 
We assess whether a goodwill impairment exists using both qualitative and quantitative assessments at the reporting level. Our qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we will not perform a quantitative assessment.
 
If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if we elect not to perform a qualitative assessment, we perform a quantitative assessment, or two-step impairment test, to determine whether a goodwill impairment exists at the reporting unit. The first step in our quantitative assessment identifies potential impairments by comparing the estimated fair value of the reporting unit to its carrying value, including goodwill (“Step 1”). If the carrying value exceeds estimated fair value, there is an indication of potential impairment and the second step is performed to measure the amount of impairment (“Step 2”).
 
For the fiscal year 2016, Cables Unlimited did not meet its sales volume and revenue goals, and the mix of product sold had lower margins than planned. These results, along with changes in the competitive marketplace and an evaluation of business priorities, led to a shift in strategic direction and reduced future revenue and profitability expectations for the business. The results of these changes and circumstances lead to the determination that Cables Unlimited did not pass our qualitative assessment and therefore a quantitative assessment was required.
 
Upon completion of our Step 1 test, we found that the results indicated that Cables Unlimited’s carrying value exceeded its estimated fair value, and as a result, the Step 2 test was performed specific to Cables Unlimited. Under Step 2, the fair value of all assets and liabilities were estimated, including customer list and backlog, for the purpose of deriving an estimate of the fair value of goodwill. The fair value of the goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Assumptions used in measuring the value of these assets and liabilities included the discount rates used in valuing the intangible assets, and consideration of the market environment in valuing the tangible assets.
 
Upon completion of our Step 2 test, our Cables Unlimited division’s goodwill was determined to be impaired. As of October 31, 2016, the Company recorded a $2.6 million impairment charge to goodwill. Cables Unlimited’s goodwill is included in the Custom Cabling Manufacturing and Assembly segment.
 
No other instances of impairment were identified as of October 31, 2016 and no instances of goodwill impairment were identified during the year ended October 31, 2017.
 
On June 15, 2011, the Company completed its acquisition of Cables Unlimited. Goodwill related to this acquisition is included within the Cables Unlimited reporting unit. Effective November 1, 2014, the Company also completed its acquisition of Comnet. Goodwill related to this acquisition is included within the Comnet reporting unit. As of May 19, 2015, the Company completed its acquisition of the CompPro product line. Goodwill related to this acquisition is included within the Connector and Cable Assembly Division. Effective June 1, 2015, the Company completed its acquisition of Rel-Tech. Goodwill related to this acquisition is included within the Rel-Tech reporting unit.
Long-lived assets
Long-lived assets
 
The Company assesses property, plant and equipment and intangible assets, which are considered definite-lived assets for impairment. Definite-lived assets are reviewed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If property and equipment and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair market value. The Company has made no material adjustments to our long-lived assets in any of the years presented.
 
The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment.
 
In addition, the Company tests our trademarks and indefinite-lived asset for impairment at least annually or more frequently if events or changes in circumstances indicate that these assets may be impaired.
 
In 2016, upon completion of our Step 2 test (see “Goodwill” above), our Cables Unlimited division’s trademark was determined to be impaired. As of October 31, 2016, the Company recorded a $150,000 impairment charge to its trademark. Cables Unlimited’s trademark is included in the Custom Cabling Manufacturing and Assembly segment.
 
No instances of impairment were identified as of October 31, 2017 and no other instances of impairment were identified as of October 31, 2016.
Earn-out liability
Earn-out liability
 
The purchase agreement for the Rel-Tech acquisition provides for earn-out payments of up to $800,000 in the aggregate, last installment of which is payable May 31, 2018. The initial earn-out liability was valued at its fair value using the Monte Carlo simulation and is included as a component of the total purchase price. The earn-out was and will continue to be revalued quarterly using a present value approach and any resulting increase or decrease will be recorded into selling and general expenses. Any changes in the assumed timing and amount of the probability of payment scenarios could impact the fair value. Significant judgment is employed in determining the appropriateness of the assumptions used in calculating the fair value of the earn-out as of the acquisition date. Accordingly, significant variances between actual and forecasted results or changes in the assumptions can materially impact the amount of contingent consideration expense we record in future periods.
 
The Company measures at fair value certain financial assets and liabilities. U. S. GAAP specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company's market assumptions. These two types of inputs have created the following fair-value hierarchy:
 
Level 1— Quoted prices for identical instruments in active markets;
 
Level 2— Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
 
Level 3— Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
 
The contingent consideration liability represents future earn-out liability that we may be required to pay in conjunction with the acquisition of Rel-Tech and Comnet. The Company estimates the fair value of the earn-out liability using a probability-weighted scenario of estimated qualifying earn-out gross profit related to Rel-Tech and EBITDA related to Comnet calculated at net present value (level 3 of the fair value hierarchy).
 
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2017 (in thousands):
 
Description Level 1 Level 2 Level 3 
Earn-out liability $- $- $236 
 
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in thousands):
 
Description Level 1 Level 2 Level 3 
Earn-out liability $- $- $835 
 
The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):
 
  Level 3 
  2017 2016 
Beginning balance $835 $1,527 
Payments  (578)  (790) 
Change in value  (21)  98 
Ending Balance $236 $835 
Intangible assets
Intangible assets
 
Intangible assets consist of the following as of October 31 (in thousands): 
 

  2017 2016 
Amortizable intangible assets:       
Non-compete agreements (estimated lives 3 - 5 years) $310 $310 
Accumulated amortization  (310)  (273) 
   -  37 
        
Customer relationships (estimated lives 7 - 15 years)  5,099  5,099 
Accumulated amortization  (2,186)  (1,644) 
   2,913  3,455 
        
Patents (estimated life 14 years)  142  142 
Accumulated amortization  (25)  (15) 
   117  127 
        
Totals $3,030 $3,619 
        
Non-amortizable intangible assets:       
Trademarks $1,237 $1,237 
 
Amortization expense for the years ended October 31, 2017 and 2016 was $589,000 and $649,000, respectively.
 
Impairment to trademarks for the years ended October 31, 2017 and 2016 was $0 and $150,000, respectively.
 
Estimated amortization expense related to finite lived intangible assets is as follows (in thousands):
 
Year ending    
October 31, Amount 
     
2018 $553 
2019  553 
2020  553 
2021  413 
2022  413 
Thereafter  545 
Total $3,030 
Advertising
Advertising
 
The Company expenses the cost of advertising and promotions as incurred. Advertising costs charged to operations were approximately $130,000 and $156,000 in 2017 and 2016, respectively.
Research and development
Research and development
 
Research and development costs are expensed as incurred. The Company’s research and development expenses relate to its engineering activities, which consist of the design and development of new products for specific customers, as well as the design and engineering of new or redesigned products for the industry in general. During the years ended October 31, 2017 and 2016, the Company recognized $845,000 and $747,000 in engineering expenses, respectively.
Income taxes
Income taxes
 
The Company accounts for income taxes under the asset and liability method, based on the income tax laws and rates in the jurisdictions in which operations are conducted and income is earned. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Developing the provision (benefit) for income taxes requires significant judgment and expertise in federal, international and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Management’s judgments and tax strategies are subject to audit by various taxing authorities.
 
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense.
Stock options
Stock options
 
For stock option grants to employees, the Company recognizes compensation expense based on the estimated fair value of the options at the date of grant. Stock-based employee compensation expense is recognized on a straight-line basis over the requisite service period. The Company issues previously unissued common shares upon the exercise of stock options.
 
For the fiscal years ended October 31, 2017 and 2016, charges related to stock-based compensation amounted to approximately $214,000 and $206,000, respectively. For the fiscal years ended October 31, 2017 and 2016, stock-based compensation classified in cost of sales amounted to $13,000 and $28,000 and stock-based compensation classified in selling and general and engineering expense amounted to $201,000 and $178,000, respectively.
Earnings per share
Earnings (loss) per share
 
Basic earnings (loss) per share is calculated by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the period. The calculation of diluted earnings (loss) per share is similar to that of basic earnings (loss) per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all potentially dilutive common shares, principally those issuable upon the exercise of stock options, were issued and the treasury stock method had been applied during the period. The greatest number of shares potentially issuable by the Company upon the exercise of stock options in any period for the years ended October 31, 2017 and 2016, that were not included in the computation because they were anti-dilutive, totaled 737,512 and 824,441, respectively.
 
The following table summarizes the computation of basic and diluted earnings (loss) per share:
 
  2017 2016 
Numerators:       
Consolidated net income (loss) (A) $382,000 $(4,089,000) 
        
Denominators:       
Weighted average shares outstanding for basic earnings (loss) per share (B)  8,840,895  8,786,510 
Add effects of potentially dilutive securities - assumed exercise of stock options  74,869  - 
        
Weighted average shares outstanding for diluted earnings (loss) per share (C)  8,915,764  8,786,510 
        
Basic earnings (loss) per share (A)/(B) $0.04 $(0.47) 
        
Diluted earnings (loss) per share (A)/(C) $0.04 $(0.47) 
Recent accounting standards
Recent accounting standards
 
Recently issued accounting pronouncements not yet adopted:
 
In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. The new standard will change the classification of certain cash payments and receipts within the cash flow statement. Specifically, payments for debt prepayment or debt extinguishment costs, including third-party costs, premiums paid, and other fees paid to lenders that are directly related to the debt prepayment or debt extinguishment, excluding accrued interest, will now be classified as financing activities. Previously, these payments were classified as operating expenses. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019, with early adoption permitted, and will be applied retrospectively. The Company does not expect that the adoption of this new standard will have a material impact on its Consolidated Financial Statements.
 
In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. This ASU requires lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The ASU also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.
 
In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Compensation – Stock Compensation. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. The new standard is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements effective for the quarter ending January 31, 2018.
 
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. This guidance will supersede Topic 605, Revenue Recognition, in addition to other industry-specific guidance, once effective. The new standard requires a company to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services.  In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, as a revision to ASU 2014-09, which revised the effective date to fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted but not prior to periods beginning after December 15, 2016 (i.e., the original adoption date per ASU 2014-09). In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations, which clarifies certain aspects of the principal-versus-agent guidance, including how an entity should identify the unit of accounting for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments also reframe the indicators to focus on evidence that an entity is acting as a principal rather than as an agent. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies how an entity should evaluate the nature of its promise in granting a license of intellectual property, which will determine whether it recognizes revenue over time or at a point in time. The amendments also clarify when a promised good or service is separately identifiable (i.e., distinct within the context of the contract) and allow entities to disregard items that are immaterial in the context of a contract. The Company continues to assess the impact this new standard may have on its ongoing financial reporting. The Company has identified its revenue streams both by contract and product type and is assessing each for potential impacts. For the revenue streams assessed, the Company does not anticipate a material impact in the timing or amount of revenue recognized.
 
In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles-Goodwill and Other, which simplifies the accounting for goodwill impairments by eliminating step 2 from the goodwill impairment test. Instead, if “the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.” The guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements.
XML 38 R23.htm IDEA: XBRL DOCUMENT v3.8.0.1
Business activities and summary of significant accounting policies (Tables)
12 Months Ended
Oct. 31, 2017
Accounting Policies [Abstract]  
Schedule of Fair Value, Assets and Liabilities
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2017 (in thousands):
 
Description Level 1 Level 2 Level 3 
Earn-out liability $- $- $236 
 
The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of October 31, 2016 (in thousands):
 
Description Level 1 Level 2 Level 3 
Earn-out liability $- $- $835 
Fair Value, Liabilities Measured on Recurring Basis
The following table summarizes the Level 3 transactions for the years ended October 31, 2017 and 2016 (in thousands):
 
  Level 3 
  2017 2016 
Beginning balance $835 $1,527 
Payments  (578)  (790) 
Change in value  (21)  98 
Ending Balance $236 $835 
Components of Intangible Assets
Intangible assets consist of the following as of October 31 (in thousands): 
 

  2017 2016 
Amortizable intangible assets:       
Non-compete agreements (estimated lives 3 - 5 years) $310 $310 
Accumulated amortization  (310)  (273) 
   -  37 
        
Customer relationships (estimated lives 7 - 15 years)  5,099  5,099 
Accumulated amortization  (2,186)  (1,644) 
   2,913  3,455 
        
Patents (estimated life 14 years)  142  142 
Accumulated amortization  (25)  (15) 
   117  127 
        
Totals $3,030 $3,619 
        
Non-amortizable intangible assets:       
Trademarks $1,237 $1,237 
Estimated Amortization Expense Related To Finite Lived Intangible Assets
Estimated amortization expense related to finite lived intangible assets is as follows (in thousands):
 
Year ending    
October 31, Amount 
     
2018 $553 
2019  553 
2020  553 
2021  413 
2022  413 
Thereafter  545 
Total $3,030 
Calculation of Basic And Diluted Earnings Per Share
The following table summarizes the computation of basic and diluted earnings (loss) per share:
 
  2017 2016 
Numerators:       
Consolidated net income (loss) (A) $382,000 $(4,089,000) 
        
Denominators:       
Weighted average shares outstanding for basic earnings (loss) per share (B)  8,840,895  8,786,510 
Add effects of potentially dilutive securities - assumed exercise of stock options  74,869  - 
        
Weighted average shares outstanding for diluted earnings (loss) per share (C)  8,915,764  8,786,510 
        
Basic earnings (loss) per share (A)/(B) $0.04 $(0.47) 
        
Diluted earnings (loss) per share (A)/(C) $0.04 $(0.47) 
XML 39 R24.htm IDEA: XBRL DOCUMENT v3.8.0.1
Discontinued operations (Tables)
12 Months Ended
Oct. 31, 2017
Discontinued Operations and Disposal Groups [Abstract]  
Summary Financial Information Related to RF Neulink
The following summarized financial information related to the RF Neulink, RadioMobile and Bioconnect divisions is segregated from continuing operations and reported as discontinued operations for the years ended October 31, 2017 and 2016 (in thousands):
 
  2017 2016 
        
Royalties $174 $57 
Bioconnect  10  (148) 
Provision (benefit) for income taxes  68  (33) 
Income (loss) from discontinued operations, net of tax $116 $(58) 
XML 40 R25.htm IDEA: XBRL DOCUMENT v3.8.0.1
Inventories and major vendors (Tables)
12 Months Ended
Oct. 31, 2017
Inventory Disclosure [Abstract]  
Components of Inventories
Inventories consist of the following (in thousands):
 
  2017 2016 
        
Raw materials and supplies $2,520 $2,642 
Work in process  194  279 
Finished goods  3,395  3,101 
        
Totals $6,109 $6,022 
XML 41 R26.htm IDEA: XBRL DOCUMENT v3.8.0.1
Other current assets (Tables)
12 Months Ended
Oct. 31, 2017
Other current assets [Abstract]  
Schedule of other current assets
Other current assets consist of the following (in thousands): 
 
  2017 2016 
        
Prepaid taxes $20 $871 
Prepaid expense  526  347 
Notes receivable, current portion  83  83 
Other  115  135 
        
Totals $744 $1,436 
XML 42 R27.htm IDEA: XBRL DOCUMENT v3.8.0.1
Accrued expenses and other long-term liabilities (Tables)
12 Months Ended
Oct. 31, 2017
Payables and Accruals [Abstract]  
Accrued expenses
Accrued expenses consist of the following (in thousands):
 
  2017 2016 
        
Wages payable $855 $941 
Accrued receipts  695  578 
Earn-out liability  236  707 
Other current liabilities  456  544 
        
Totals $2,242 $2,770 
XML 43 R28.htm IDEA: XBRL DOCUMENT v3.8.0.1
Segment information (Tables)
12 Months Ended
Oct. 31, 2017
Segment Reporting [Abstract]  
Sales by Geographic Area
The following table presents the sales of the Company by geographic area for the years ended October 31, 2017 and 2016 (in thousands):
 
  2017 2016 
        
United States $30,232 $29,257 
Foreign Countries:       
Canada  483  509 
Israel  -  63 
Mexico  78  234 
All Other  171  178 
   732  984 
        
Totals $30,964 $30,241 
Net Sales, Income (Loss) Before Provision for Income Taxes and Other Related Segment Information
Net sales, income (loss) from continuing operations before provision (benefit) for income taxes and other related segment information for the years ended October 31, 2017 and 2016 are as follows (in thousands): 
 
  RF Connector Custom Cabling       
  and Manufacturing and       
  Cable Assembly Assembly Corporate Total 
2017             
Net sales $11,456 $19,508 $- $30,964 
Income (loss) from continuing operations before provision (benefit) for income taxes  382  (11)  29  400 
Depreciation and amortization  177  700  -  877 
Total assets  6,297  11,910  6,853  25,060 
              
2016             
Net sales $9,352 $20,889 $- $30,241 
Loss from continuing operations before provision (benefit) for income taxes  (1,358)  (3,232)  (93)  (4,683) 
Depreciation and amortization  194  842  -  1,036 
Total assets  5,902  13,100  6,835  25,837 
XML 44 R29.htm IDEA: XBRL DOCUMENT v3.8.0.1
Income tax provision (Tables)
12 Months Ended
Oct. 31, 2017
Income Tax Disclosure [Abstract]  
Schedule of components of income tax expense (benefit)
The provision (benefit) for income taxes for the fiscal years ended October 31, 2017 and 2016 consists of the following (in thousands):
 
  2017 2016 
Current:       
Federal $400 $(332) 
State  24  (13) 
   424  (345) 
        
Deferred:       
Federal  (293)  (179) 
State  3  (128) 
   (290)  (307) 
        
  $134 $(652) 
Schedule of Effective Income Tax Rate and Amount Reconciliation
Income tax at the federal statutory rate is reconciled to the Company’s actual net provision (benefit) for income taxes as follows (in thousands, except percentages):
 
  2017 2016 
     % of Pretax    % of Pretax 
  Amount Income Amount Income 
              
Income taxes at federal statutory rate $136  34.0%$(1,592)  34.0%
State tax provision, net of federal tax benefit  16  4.0% (53)  1.1%
Nondeductible differences:             
Goodwill and other intangible asset impairment  -  0.0% 916  -19.6%
Rel-Tech earn-out  (9)  -2.3% 52  -1.1%
Qualified domestic production activities deduction  (66)  -16.5% 46  -1.0%
ISO stock options  33  8.3% 52  -1.1%
Meals and entertainment  21  5.3% 29  -0.6%
Temporary true-ups  26  6.4% -  0.0%
State tax refunds, net of federal expense  (4)  -0.8% (38)  0.8%
R&D credits  (37)  -9.3% (46)  1.0%
Other  18  4.4% (18)  0.4%
  $134  33.5%$(652)  13.9%
Schedule of deferred tax assets and liabilities
The Company’s total deferred tax assets and deferred tax liabilities at October 31, 2017 and 2016 are as follows (in thousands):
 
  2017 2016 
        
Deferred Tax Assets:       
Reserves $375 $216 
Accrued vacation  122  134 
Stock-based compensation awards  184  159 
Uniform capitalization  130  148 
Other  70  43 
Total deferred tax assets  881  700 
        
Deferred Tax Liabilities:       
Amortization / intangible assets  (805)  (864) 
Depreciation / equipment and furnishings  (195)  (211) 
Other  -  (34) 
Total deferred tax liabilities  (1,000)  (1,109) 
        
Total net deferred tax assets (liabilities) $(119) $(409) 
XML 45 R30.htm IDEA: XBRL DOCUMENT v3.8.0.1
Stock options (Tables)
12 Months Ended
Oct. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Computation of Weighted Average Fair Value of Employee Stock Options using Black-Scholes Option Pricing Model Assumptions
The fair value of each option granted in 2017 and 2016 was estimated on the grant date using the Black-Scholes option pricing model with the following assumptions:
 
  2017  2016 
Weighted average volatility  43.3%  28.7%
Expected dividends  5.0%  2.4%
Expected term (in years)  4.3   3.0 
Risk-free interest rate  1.20%  0.70%
Weighted average fair value of options granted during the year $0.39  $0.66 
Weighted average fair value of options vested during the year $1.95  $4.36 
Summary of Status of Options Granted under Stock Option Plans and Changes in Options Outstanding
Additional information regarding all of the Company's outstanding stock options at October 31, 2017 and 2016 and changes in outstanding stock options in 2017 and 2016 follows:
 
  2017 2016 
  Shares or Weighted Shares or Weighted 
  Price Per Average Price Per Average 
  Share Exercise Price Share Exercise Price 
Options outstanding at beginning of year  1,007,851 $4.07  1,240,100 $3.64 
Options granted  449,068 $1.61  104,936 $3.36 
Options exercised  (36,763) $1.50  (180,067) $0.27 
Options forfeited  (260,385) $4.10  (157,118) $4.53 
Options outstanding at end of year  1,159,771 $3.19  1,007,851 $4.07 
              
Options exercisable at end of year  926,272 $3.08  724,457 $3.93 
              
Options vested and expected to vest at end of year  1,159,002 $3.19  1,002,522 $4.07 
              
Option price range at end of year $ 1.07 - $6.91     $ 2.30 - $6.91     
              
Aggregate intrinsic value of options exercised during year $55,000    $456,000    
XML 46 R31.htm IDEA: XBRL DOCUMENT v3.8.0.1
Commitments (Tables)
12 Months Ended
Oct. 31, 2017
Commitments and Contingencies Disclosure [Abstract]  
Minimum Lease Payments, Operating Leases
Minimum lease payments under these non-cancelable operating leases in each of the years subsequent to October 31, 2017 are as follows (in thousands):
 
Year ending    
October 31, Amount 
     
2018 $645 
2019  516 
2020  441 
2021  440 
2022  359 
Total $2,401 
XML 47 R32.htm IDEA: XBRL DOCUMENT v3.8.0.1
Schedule of Fair Value (Details) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Level 1    
Earn-out liability $ 0 $ 0
Level 2    
Earn-out liability 0 0
Level 3    
Earn-out liability $ 236 $ 835
XML 48 R33.htm IDEA: XBRL DOCUMENT v3.8.0.1
Fair Value, Liabilities Measured on Recurring Basis (Details) - Level 3 - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Beginning balance $ 835 $ 1,527
Payments (578) (790)
Change in value (21) 98
Ending Balance $ 236 $ 835
XML 49 R34.htm IDEA: XBRL DOCUMENT v3.8.0.1
Intangible assets (Detail) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Intangible Assets [Line Items]    
Amortizable intangible assets, net $ 3,030 $ 3,619
Non-amortizable intangible assets, trade marks 1,237 1,237
Non-compete agreements (estimated lives 3 - 5 years)    
Intangible Assets [Line Items]    
Amortizable intangible assets, gross 310 310
Amortizable intangible assets, accumulated amortization (310) (273)
Amortizable intangible assets, net 0 37
Customer relationships (estimated lives 7 - 15 years)    
Intangible Assets [Line Items]    
Amortizable intangible assets, gross 5,099 5,099
Amortizable intangible assets, accumulated amortization (2,186) (1,644)
Amortizable intangible assets, net 2,913 3,455
Patents (estimated life 14 years)    
Intangible Assets [Line Items]    
Amortizable intangible assets, gross 142 142
Amortizable intangible assets, accumulated amortization (25) (15)
Amortizable intangible assets, net $ 117 $ 127
XML 50 R35.htm IDEA: XBRL DOCUMENT v3.8.0.1
Intangible assets (Parenthetical) (Detail)
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Non-compete agreements (estimated lives 3 - 5 years) | Maximum [Member]    
Intangible Assets [Line Items]    
Finite-Lived Intangible Asset, Useful Life 5 years 5 years
Non-compete agreements (estimated lives 3 - 5 years) | Minimum [Member]    
Intangible Assets [Line Items]    
Finite-Lived Intangible Asset, Useful Life 3 years 3 years
Customer relationships (estimated lives 7 - 15 years) | Maximum [Member]    
Intangible Assets [Line Items]    
Finite-Lived Intangible Asset, Useful Life 15 years 15 years
Customer relationships (estimated lives 7 - 15 years) | Minimum [Member]    
Intangible Assets [Line Items]    
Finite-Lived Intangible Asset, Useful Life 7 years 7 years
Patents (estimated life 14 years)    
Intangible Assets [Line Items]    
Finite-Lived Intangible Asset, Useful Life 14 years 14 years
XML 51 R36.htm IDEA: XBRL DOCUMENT v3.8.0.1
Estimated amortization expense related to finite lived intangible assets (Detail) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Estimated Amortization Expense Related To Finite Lived Intangible Assets [Line Items]    
2018 $ 553  
2019 553  
2020 553  
2021 413  
2022 413  
Thereafter 545  
Total $ 3,030 $ 3,619
XML 52 R37.htm IDEA: XBRL DOCUMENT v3.8.0.1
Computation of Basic and Diluted Weighted Average Shares Outstanding (Detail) - USD ($)
$ / shares in Units, $ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Numerators:    
Consolidated net income (loss) (A) $ 382 $ (4,089)
Denominators:    
Weighted average shares outstanding for basic earnings (loss) per share (B) 8,840,895 8,786,510
Add effects of potentially dilutive securities - assumed exercise of stock options 74,869 0
Weighted average shares outstanding for diluted earnings (loss) per share (C) 8,915,764 8,786,510
Basic earnings (loss) per share (A)/(B) $ 0.04 $ (0.47)
Diluted earnings (loss) per share (A)/(C) $ 0.04 $ (0.47)
XML 53 R38.htm IDEA: XBRL DOCUMENT v3.8.0.1
Business activities and summary of significant accounting policies - Additional Information (Detail) - USD ($)
1 Months Ended 12 Months Ended
May 31, 2018
Oct. 31, 2017
Oct. 31, 2016
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Amortization of Intangible Assets   $ 589,000 $ 649,000
Advertising Expense   130,000 156,000
Research and Development Expense   845,000 747,000
Stock based compensation expense   $ 214,000 $ 206,000
Shares excluded from computation of diluted per share amount   737,512 824,441
Subsequent Event [Member]      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Earn-out Payment $ 800,000    
Trademarks [Member]      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Impairment of Intangible Assets, Finite-lived   $ 0 $ 150,000
Cables Unlimited Division [Member]      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Goodwill, Impairment Loss     2,600,000
Cables Unlimited Division [Member] | Trademarks [Member]      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Impairment of Intangible Assets, Finite-lived     150,000
Maximum      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Property, Plant and Equipment, Useful Life   5 years  
Minimum      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Property, Plant and Equipment, Useful Life   3 years  
Selling General and Engineering Expenses      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Stock based compensation expense   $ 201,000 178,000
Cost of Sales      
Business Activities And Summary Of Significant Accounting Policies [Line Items]      
Stock based compensation expense   $ 13,000 $ 28,000
XML 54 R39.htm IDEA: XBRL DOCUMENT v3.8.0.1
Summary of financial information related to RF Neulink (Detail) - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Royalties $ 174 $ 57
Provision (benefit) for income taxes 68 (33)
Income (loss) from discontinued operations, net of tax 116 (58)
Bioconnect division [Member]    
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Income (loss) from discontinued operations, net of tax $ 10 $ (148)
XML 55 R40.htm IDEA: XBRL DOCUMENT v3.8.0.1
Discontinued operations - Additional Information (Detail) - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Royalty revenue $ 174 $ 57
Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent 116 (58)
Inventory Write-down 0 168
RF Neulink [Member] | Radio Mobile, Inc [Member]    
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Royalty revenue 174 57
Bioconnect division [Member]    
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent 10 $ (148)
Inventory Write-down $ 148  
XML 56 R41.htm IDEA: XBRL DOCUMENT v3.8.0.1
Concentrations of credit risk - Additional Information (Detail) - USD ($)
$ in Millions
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Concentration Risk [Line Items]    
Cash, FDIC insured amount $ 5.2  
Sales Revenue, Goods, Net    
Concentration Risk [Line Items]    
Concentration risk, percentage   15.00%
Sales Revenue, Goods, Net | Customer One [Member]    
Concentration Risk [Line Items]    
Concentration risk, percentage 20.00%  
Sales Revenue, Goods, Net | Customer Two [Member]    
Concentration Risk [Line Items]    
Concentration risk, percentage 11.00%  
Accounts Receivable    
Concentration Risk [Line Items]    
Concentration risk, percentage   20.00%
Accounts Receivable | Customer One [Member]    
Concentration Risk [Line Items]    
Concentration risk, percentage 27.00%  
Accounts Receivable | Customer Two [Member]    
Concentration Risk [Line Items]    
Concentration risk, percentage 5.00%  
XML 57 R42.htm IDEA: XBRL DOCUMENT v3.8.0.1
Inventories and major vendors - Components of Inventories (Detail) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Inventory [Line Items]    
Raw materials and supplies $ 2,520 $ 2,642
Work in process 194 279
Finished goods 3,395 3,101
Totals $ 6,109 $ 6,022
XML 58 R43.htm IDEA: XBRL DOCUMENT v3.8.0.1
Inventories and major vendors - Additional Information (Detail) - Supplier Concentration Risk [Member]
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Vendor One    
Inventory [Line Items]    
Purchases of connector products, percentage 7.00% 9.00%
Vendor Two    
Inventory [Line Items]    
Purchases of connector products, percentage 5.00% 6.00%
XML 59 R44.htm IDEA: XBRL DOCUMENT v3.8.0.1
Other current assets (Detail) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Prepaid taxes $ 20 $ 871
Prepaid expense 526 347
Notes receivable, current portion 83 83
Other 115 135
Totals $ 744 $ 1,436
XML 60 R45.htm IDEA: XBRL DOCUMENT v3.8.0.1
Other current assets - Additional Information (Detail) - USD ($)
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Increase (Decrease) In Other Noncurrent Assets $ (71,000) $ 102,000
Notes Receivable [Member]    
Increase (Decrease) In Other Noncurrent Assets $ 0 $ 21,000
XML 61 R46.htm IDEA: XBRL DOCUMENT v3.8.0.1
Accrued expenses and other long-term liabilities (Detail) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Schedule of Accrued Liabilities [Line Items]    
Wages payable $ 855 $ 941
Accrued receipts 695 578
Earn-out liability 236 707
Other current liabilities 456 544
Totals $ 2,242 $ 2,770
XML 62 R47.htm IDEA: XBRL DOCUMENT v3.8.0.1
Accrued expenses and other long-term liabilities - Additional Information (Detail)
Oct. 31, 2016
USD ($)
Other Noncurrent Liabilities [Member]  
Schedule Of Accrued Liabilities [Line Items]  
Accrued Earn Out Liability Non Current $ 128,000
XML 63 R48.htm IDEA: XBRL DOCUMENT v3.8.0.1
Sales by geographic area (Detail) - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Revenue, Major Customer [Line Items]    
Sales revenue $ 30,964 $ 30,241
United States    
Revenue, Major Customer [Line Items]    
Sales revenue 30,232 29,257
Canada    
Revenue, Major Customer [Line Items]    
Sales revenue 483 509
Israel    
Revenue, Major Customer [Line Items]    
Sales revenue 0 63
Mexico    
Revenue, Major Customer [Line Items]    
Sales revenue 78 234
All other    
Revenue, Major Customer [Line Items]    
Sales revenue 171 178
Foreign countries, total    
Revenue, Major Customer [Line Items]    
Sales revenue $ 732 $ 984
XML 64 R49.htm IDEA: XBRL DOCUMENT v3.8.0.1
Net sales, income (loss) before provision for income taxes and other related segment information (Detail) - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Segment Reporting Information [Line Items]    
Net sales $ 30,964 $ 30,241
Income (loss) from continuing operations before provision (benefit) for income taxes 400 (4,683)
Depreciation and amortization 877 1,036
Total assets 25,060 25,837
RF Connector and Cable Assembly    
Segment Reporting Information [Line Items]    
Net sales 11,456 9,352
Income (loss) from continuing operations before provision (benefit) for income taxes 382 (1,358)
Depreciation and amortization 177 194
Total assets 6,297 5,902
Custom Cabling Manufacturing and Assembly    
Segment Reporting Information [Line Items]    
Net sales 19,508 20,889
Income (loss) from continuing operations before provision (benefit) for income taxes (11) (3,232)
Depreciation and amortization 700 842
Total assets 11,910 13,100
Corporate    
Segment Reporting Information [Line Items]    
Net sales 0 0
Income (loss) from continuing operations before provision (benefit) for income taxes 29 (93)
Depreciation and amortization 0 0
Total assets $ 6,853 $ 6,835
XML 65 R50.htm IDEA: XBRL DOCUMENT v3.8.0.1
Provision (benefit) for income taxes (Detail) - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Current:    
Federal $ 400 $ (332)
State 24 (13)
Current income tax expense (benefit) 424 (345)
Deferred:    
Federal (293) (179)
State 3 (128)
Deferred income tax expense (benefit) (290) (307)
Provision for income taxes $ 134 $ (652)
XML 66 R51.htm IDEA: XBRL DOCUMENT v3.8.0.1
Income tax at the federal statutory rate is reconciled (Detail) - USD ($)
$ in Thousands
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Income taxes at federal statutory rate $ 136 $ (1,592)
State tax provision, net of federal tax benefit 16 (53)
Nondeductible differences:    
Goodwill and other intangible asset impairment 0 916
Rel-Tech earn-out (9) 52
Qualified domestic production activities deduction (66) 46
ISO stock options 33 52
Meals and entertainment 21 29
Temporary true-ups 26 0
State tax refunds, net of federal expense (4) (38)
R& D credits (37) (46)
Other 18 (18)
Net provision (benefit) for income taxes $ 134 $ (652)
Income taxes at federal statutory rate (% of Pretax Income) 34.00% 34.00%
State tax provision, net of federal tax benefit (% of Pretax Income) 4.00% 1.10%
Nondeductible differences: (% of Pretax Income)    
Goodwill and other intangible asset impairment (% of Pretax Income) 0.00% (19.60%)
Rel-Tech earn-out (% of Pretax Income) (2.30%) (1.10%)
Qualified domestic production activities deduction (% of Pretax Income) (16.50%) (1.00%)
ISO stock options (% of Pretax Income) 8.30% (1.10%)
Meals and entertainment (% of Pretax Income) 5.30% (0.60%)
Temporary true-ups (% of Pretax Income) 6.40% 0.00%
State tax refunds, net of federal expense (% of Pretax Income) (0.80%) 0.80%
R& D credits (% of Pretax Income) (9.30%) 1.00%
Other (% of Pretax Income) 4.40% 0.40%
Net provision (benefit) for income taxes (% of Pretax Income) 33.50% 13.90%
XML 67 R52.htm IDEA: XBRL DOCUMENT v3.8.0.1
Total of deferred tax assets and deferred tax liabilities (Detail) - USD ($)
$ in Thousands
Oct. 31, 2017
Oct. 31, 2016
Deferred Tax Assets:    
Reserves $ 375 $ 216
Accrued vacation 122 134
Stock-based compensation awards 184 159
Uniform capitalization 130 148
Other 70 43
Total deferred tax assets 881 700
Deferred Tax Liabilities:    
Amortization / intangible assets (805) (864)
Depreciation / equipment and furnishings (195) (211)
Other 0 (34)
Total deferred tax liabilities (1,000) (1,109)
Total net deferred tax assets (liabilities) $ (119) $ (409)
XML 68 R53.htm IDEA: XBRL DOCUMENT v3.8.0.1
Income tax provision - Additional Information (Detail)
1 Months Ended
Dec. 22, 2017
Subsequent Event [Member]  
Income Taxes [Line Items]  
Effective Income Tax Rate Reconciliation, Percent 21.00%
XML 69 R54.htm IDEA: XBRL DOCUMENT v3.8.0.1
Computation of weighted average fair value of employee stock options using black-scholes option pricing model assumptions (Detail) - $ / shares
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted average volatility 43.30% 28.70%
Expected dividends 5.00% 2.40%
Expected term (in years) 4 years 3 months 18 days 3 years
Risk-free interest rate 1.20% 0.70%
Weighted average fair value of options granted during the year $ 0.39 $ 0.66
Weighted average fair value of options vested during the year $ 1.95 $ 4.36
XML 70 R55.htm IDEA: XBRL DOCUMENT v3.8.0.1
Summary of status of options granted under stock option plans and changes in options outstanding (Detail) - USD ($)
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Shares    
Aggregate intrinsic value of options exercised during year $ 552,000  
Stock Option    
Shares    
Options outstanding at beginning of year 1,007,851 1,240,100
Options granted 449,068 104,936
Options exercised (36,763) (180,067)
Options forfeited (260,385) (157,118)
Options outstanding at end of year 1,159,771 1,007,851
Options exercisable at end of year 926,272 724,457
Options vested and expected to vest at end of year 1,159,002 1,002,522
Option price lower range $ 1.07 $ 2.30
Option price upper range $ 6.91 $ 6.91
Aggregate intrinsic value of options exercised during year $ 55,000 $ 456,000
Weighted Average Exercise Price    
Options outstanding at beginning of year $ 4.07 $ 3.64
Options granted 1.61 3.36
Options exercised 1.50 0.27
Options forfeited 4.10 4.53
Options outstanding at end of year 3.19 4.07
Options exercisable at end of year 3.08 3.93
Options vested and expected to vest at end of year $ 3.19 $ 4.07
XML 71 R56.htm IDEA: XBRL DOCUMENT v3.8.0.1
Stock options - Additional Information (Detail) - USD ($)
3 Months Ended 12 Months Ended
Sep. 08, 2017
Apr. 07, 2016
Sep. 04, 2015
Sep. 05, 2014
Jan. 31, 2017
Oct. 31, 2017
Oct. 31, 2016
Mar. 09, 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                
Weighted average remaining life of options outstanding           4 years 2 months 8 days    
Weighted average remaining contractual life of options exercisable           3 years 2 months 5 days    
Weighted average life of options vested and expected to vest           4 years 2 months 8 days    
Aggregate intrinsic value of options outstanding           $ 552,000    
Aggregate intrinsic value of options exercisable           503,000    
Aggregate intrinsic value of options vested and expected to vest           552,000    
Non-vested stock-based arrangements yet to be recognized           $ 275,000    
Stock based arrangements yet to be recognized, weighted average period expected to be recognized           6 years 3 months 29 days    
Non-employee director annual grant           $ 30,000 $ 50,000  
Options granted for each non-employee director         77,339      
Value of stock option issued           $ 25,000    
Fair value of stock option           $ 0.32    
Chief Operating Officer                
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                
Share-based compensation arrangement by share-based payment award, options, grants in period, gross   33,744            
Stock Issued During Period, Value, Share-based Compensation, Gross   $ 8,750            
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Exercise Price   $ 0.26            
Mr. Garland [Member]                
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                
Fair value of stock option           $ 0.40    
Stock Issued During Period, Value, Share-based Compensation, Gross           $ 9,863    
2000 Stock Option Plan                
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized               1,000,000
2010 Stock Incentive Plan                
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant           1,726,138    
Incentive and Non-Qualified Stock Option Plans                
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]                
Additional Shares Of Common Stock Issued 1,000,000   500,000 500,000        
XML 72 R57.htm IDEA: XBRL DOCUMENT v3.8.0.1
Retirement plan - Additional Information (Detail) - USD ($)
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Compensation And Retirement [Line Items]    
Pension and Other Postretirement Benefit Contributions $ 166,000 $ 182,000
Percentage Of Employee Contribution Paid 3.00%  
XML 73 R58.htm IDEA: XBRL DOCUMENT v3.8.0.1
Related party transactions - Additional Information (Detail) - USD ($)
1 Months Ended 12 Months Ended
Jun. 15, 2011
Oct. 31, 2017
Oct. 31, 2016
New York [Member]      
Related Party Transaction [Line Items]      
Operating Leases, Rent Expense $ 13,000    
Payments for Rent   $ 156,000  
Chief Executive Officer [Member]      
Related Party Transaction [Line Items]      
Due from Officers or Stockholders, Noncurrent     $ 67,000
Debt Instrument, Interest Rate During Period     6.00%
XML 74 R59.htm IDEA: XBRL DOCUMENT v3.8.0.1
Cash dividend and declared dividends - Additional Information (Detail) - USD ($)
$ / shares in Units, $ in Thousands
3 Months Ended 12 Months Ended
Oct. 31, 2016
Jul. 31, 2016
Apr. 30, 2016
Jan. 31, 2016
Oct. 31, 2017
Oct. 31, 2016
Dividends Payable [Line Items]            
Dividends paid, per share $ 0.02 $ 0.02 $ 0.02 $ 0.07 $ 0.02  
Dividends paid         $ 707 $ 1,141
XML 75 R60.htm IDEA: XBRL DOCUMENT v3.8.0.1
Commitments - Additional Information (Detail) - USD ($)
12 Months Ended
Oct. 31, 2017
Oct. 31, 2016
Commitments And Contingencies [Line Items]    
Operating Leases, Rent Expense, Net, Total $ 644,000 $ 628,000
Accrued Liabilities and Other Liabilities, Total $ 95,000 $ 3,000
XML 76 R61.htm IDEA: XBRL DOCUMENT v3.8.0.1
Minimum lease payments operating lease (Detail)
$ in Thousands
Oct. 31, 2017
USD ($)
Commitments And Contingencies [Line Items]  
2018 $ 645
2019 516
2020 441
2021 440
2022 359
Total $ 2,401
XML 77 R62.htm IDEA: XBRL DOCUMENT v3.8.0.1
Line of credit - Additional Information (Detail) - USD ($)
$ in Millions
12 Months Ended
Oct. 31, 2017
Sep. 07, 2016
Line of Credit Facility [Line Items]    
Line of Credit Facility, Expiration Date Sep. 08, 2016  
Line of Credit Facility, Amount Outstanding   $ 5
XML 78 R63.htm IDEA: XBRL DOCUMENT v3.8.0.1
Subsequent events - Additional Information (Detail) - Subsequent Event - $ / shares
1 Months Ended
Dec. 13, 2017
Dec. 22, 2017
Subsequent Event [Line Items]    
Dividends payable, amount per share $ 0.02  
Dividends payable, date to be paid Jan. 15, 2018  
Dividends payable, record date Dec. 31, 2017  
Effective Income Tax Rate Reconciliation, Percent   21.00%
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