x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
The KEYW Holding
Corporation
|
(Exact
name of registrant as specified in its
charter)
|
Maryland
|
27-1594952
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No.)
|
1334
Ashton Road, Suite A
|
|
Hanover, Maryland
|
21076
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Large
accelerated filer ¨
|
Accelerated
filer ¨
|
Non-accelerated
filer x (Do
not check if smaller reporting company)
|
Smaller
reporting company ¨
|
PART
I
|
FINANCIAL
INFORMATION
|
|
Item
1
|
Financial
Statements
|
|
Consolidated
Balance Sheets as of September 30, 2010 (unaudited) and December 31,
2009
|
2
|
|
Consolidated
Statements of Operations (unaudited) for the Three and Nine Months Ended
September 30, 2010 and September 30, 2009
|
3
|
|
Consolidated
Statement of Stockholders’ Equity (unaudited) for the Nine Months Ended
September 30, 2010
|
4
|
|
Condensed
Consolidated Statements of Cash Flows (unaudited) for the Nine Months
Ended September 30, 2010 and September 30, 2009
|
5
|
|
Notes
to Consolidated Financial Statements
|
6
|
|
Item
2
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations
|
20
|
Item
3
|
Quantitative
and Qualitative Disclosures about Market Risk
|
24
|
Item
4
|
Controls
and Procedures
|
24
|
PART
II
|
OTHER
INFORMATION
|
|
Item
1
|
Legal
Proceedings
|
25
|
Item
1A
|
Risk
Factors
|
25
|
Item
2
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
25
|
Item
6
|
Exhibits
|
26
|
September 30,
|
December 31,
|
|||||||
2010
|
2009
|
|||||||
(unaudited)
|
||||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 1,259 | $ | 7,333 | ||||
Receivables,
net
|
21,844 | 9,409 | ||||||
Inventories
|
4,635 | 4,334 | ||||||
Prepaid
expenses
|
1,378 | 1,240 | ||||||
Income
tax receivable
|
223 | 223 | ||||||
Total
current assets
|
29,339 | 22,539 | ||||||
Property
and equipment, net
|
2,858 | 1,430 | ||||||
Goodwill
|
92,045 | 34,927 | ||||||
Other
intangibles, net
|
14,114 | 6,314 | ||||||
Deferred
tax asset
|
1,892 | 1,892 | ||||||
Other
assets
|
191 | 28 | ||||||
TOTAL
ASSETS
|
$ | 140,439 | $ | 67,130 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 4,539 | $ | 442 | ||||
Accrued
expenses
|
1,615 | 435 | ||||||
Accrued
salaries & wages
|
4,721 | 2,214 | ||||||
Revolver
|
10,500 | - | ||||||
Short-term
subordinated debt
|
11,001 | - | ||||||
Deferred
income taxes
|
83 | 83 | ||||||
Total
current liabilities
|
32,459 | 3,174 | ||||||
Long-term
liabilities:
|
||||||||
Long-term
subordinated debt
|
8,672 | - | ||||||
Non-current
deferred tax liability
|
8,613 | 1,564 | ||||||
Other
non-current liabilities
|
141 | 53 | ||||||
Accrued
earn-out
|
10,000 | - | ||||||
TOTAL
LIABILITIES
|
59,885 | 4,791 | ||||||
Commitments
and contingencies
|
||||||||
Stockholders'
equity:
|
||||||||
Preferred
stock, $0.001 par value; 5,000,000 shares authorized, none
issued
|
- | - | ||||||
Common
stock, $0.001 par value;
100,000,000 shares authorized, 15,537,198 and
14,187,520 issued and outstanding
|
16 | 14 | ||||||
Additional
paid-in capital
|
74,969 | 66,504 | ||||||
Retained
earnings/(Accumulated deficit)
|
5,569 | (4,179 | ) | |||||
Total
stockholders' equity
|
80,554 | 62,339 | ||||||
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY
|
$ | 140,439 | $ | 67,130 |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
September 30,
|
September 30,
|
|||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
(unaudited)
|
(unaudited)
|
(unaudited)
|
(unaudited)
|
|||||||||||||
Revenue
|
||||||||||||||||
Services
|
$ | 25,227 | $ | 8,212 | $ | 67,926 | $ | 22,468 | ||||||||
Products
|
3,765 | 1,846 | 10,725 | 4,474 | ||||||||||||
Total
|
28,992 | 10,058 | 78,651 | 26,942 | ||||||||||||
Cost
of Revenue
|
||||||||||||||||
Services
|
18,243 | 6,090 | 49,377 | 16,513 | ||||||||||||
Products
|
2,317 | 1,578 | 6,254 | 3,188 | ||||||||||||
Total
|
20,560 | 7,668 | 55,631 | 19,701 | ||||||||||||
Gross
Profit
|
||||||||||||||||
Services
|
6,984 | 2,122 | 18,549 | 5,955 | ||||||||||||
Products
|
1,448 | 268 | 4,471 | 1,286 | ||||||||||||
Total
|
8,432 | 2,390 | 23,020 | 7,241 | ||||||||||||
Operating
expenses
|
7,028 | 4,307 | 18,648 | 8,046 | ||||||||||||
Intangible
amortization expense
|
1,693 | 520 | 4,454 | 1,461 | ||||||||||||
Loss
from operations
|
(289 | ) | (2,437 | ) | (82 | ) | (2,266 | ) | ||||||||
Interest
Expense(income), net
|
1,005 | - | 1,677 | (100 | ) | |||||||||||
Other
non-operating (income)expense, net
|
(8,765 | ) | (76 | ) | (18,373 | ) | 872 | |||||||||
Total
non-operating (income)expense, net
|
(7,760 | ) | (76 | ) | (16,696 | ) | 772 | |||||||||
Income(Loss)
before provision for income taxes
|
7,471 | (2,361 | ) | 16,614 | (3,038 | ) | ||||||||||
Income
tax (expense)benefit
|
(3,063 | ) | 652 | (6,866 | ) | 546 | ||||||||||
Net
Income(Loss)
|
$ | 4,408 | $ | (1,709 | ) | $ | 9,748 | $ | (2,492 | ) | ||||||
Weighted
average common shares outstanding:
|
||||||||||||||||
Basic
|
15,531,332 | 13,940,176 | 15,174,140 | 13,023,080 | ||||||||||||
Fully
Diluted
|
18,443,699 | 13,940,176 | 18,176,841 | 13,023,080 | ||||||||||||
Basic
and diluted earnings per share
|
||||||||||||||||
Basic
|
$ | 0.28 | $ | (0.12 | ) | $ | 0.64 | $ | (0.19 | ) | ||||||
Fully
Diluted
|
$ | 0.24 | $ | (0.12 | ) | $ | 0.54 | $ | (0.19 | ) |
Common Stock
|
Retained
|
|||||||||||||||||||
Shares
|
Amount
|
APIC
|
Earnings
|
Total
|
||||||||||||||||
Balance
as of December 31, 2009
|
14,187,520 | $ | 14 | $ | 66,504 | $ | (4,179 | ) | $ | 62,339 | ||||||||||
Net
income
|
9,748 | 9,748 | ||||||||||||||||||
Warrant
exercise
|
1,022,728 | 1 | 4,499 | 4,500 | ||||||||||||||||
Option
exercise
|
250 | 0 | 1 | 1 | ||||||||||||||||
Restricted
stock forfeitures
|
(800 | ) | (0 | ) | (0 | ) | ||||||||||||||
Warrants
issued in conjunction with sub-debt
|
- | 585 | 585 | |||||||||||||||||
Stock
issued as part of the Insight acquisition
|
250,000 | 0 | 2,312 | 2,312 | ||||||||||||||||
Stock
based compensation
|
77,500 | 0 | 1,068 | 1,068 | ||||||||||||||||
Balance
as of September 30, 2010
|
15,537,198 | $ | 16 | $ | 74,969 | $ | 5,569 | $ | 80,554 |
September 30,
|
September 30,
|
|||||||
2010
|
2009
|
|||||||
(unaudited)
|
(unaudited)
|
|||||||
Net income
|
$ | 9,748 | $ | (2,492 | ) | |||
Adjustments to
reconcile net loss to net
|
||||||||
Cash
used in operating activities
|
||||||||
Stock
compensation
|
1,068 | 127 | ||||||
Depreciation/Amortization
|
4,988 | 1,675 | ||||||
Warrant
accounting
|
- | 823 | ||||||
Loss
on disposal of equipment
|
10 | - | ||||||
Non-cash
interest expense
|
1,006 | - | ||||||
Non-cash
impact of TAG earn-out reduction
|
(17,750 | ) | - | |||||
Deferred
taxes
|
7,049 | 370 | ||||||
Decrease
(increase) in balance sheet items
|
||||||||
Receivables
|
(6,333 | ) | (3,186 | ) | ||||
Inventory
|
(301 | ) | (1,983 | ) | ||||
Prepaid
expenses
|
(542 | ) | (285 | ) | ||||
Accounts
payable
|
(1,284 | ) | 56 | |||||
Accrued
expenses
|
2,114 | 1,443 | ||||||
Other
balance sheet changes
|
(126 | ) | (866 | ) | ||||
Net
cash used in operations
|
(353 | ) | (4,318 | ) | ||||
Cash
flows from investing activities
|
||||||||
Acquisitions,
net of cash acquired
|
(27,629 | ) | (3,241 | ) | ||||
Purchase
of property and equipment
|
(1,470 | ) | (937 | ) | ||||
Proceeds
from the sale of equipment
|
128 | 4 | ||||||
Net
cash used in investing activities
|
(28,971 | ) | (4,174 | ) | ||||
Cash
flows from financing activities
|
||||||||
Proceeds
from stock issuances
|
- | 29,397 | ||||||
Proceeds
from revolver
|
18,100 | - | ||||||
Repayments
of revolver
|
(7,600 | ) | - | |||||
Proceeds
from subordinated debt
|
8,250 | - | ||||||
Proceeds
from warrant exercise
|
4,500 | - | ||||||
Net
cash provided by financing activities
|
23,250 | 29,397 | ||||||
Net
decrease in cash and cash equivalents
|
(6,074 | ) | 20,905 | |||||
Cash
and cash equivalents at beginning of period
|
7,333 | 5,397 | ||||||
Cash
and cash equivalents at end of period
|
$ | 1,259 | $ | 26,302 |
1.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
As of 9/30/10
|
Shares
|
Price Range
|
|||||
Warrants
|
4,813,806 |
$4.00
- $9.25
|
|||||
Options
|
1,370,375 |
$5.00
- $10.00
|
|||||
Total
|
6,184,181 |
As of 9/30/09
|
Shares
|
Price Range
|
|||||
Warrants
|
5,621,534 |
$4.00
- $5.50
|
|||||
Options
|
265,000 |
$5.00
- $5.50
|
|||||
Total
|
5,886,534 |
2.
|
ACQUISITIONS
|
TAG
|
IIT
|
ESD
|
LEDS
|
Recon
|
||||||||||||||||
Cash
|
$ | 1,178 | $ | 178 | $ | - | $ |
-
|
$ |
-
|
||||||||||
Current
assets, net of cash acquired
|
7,622 | 697 | 65 | 14 | - | |||||||||||||||
Fixed
assets
|
18 | 60 | 11 | 25 | - | |||||||||||||||
Intangibles
|
10,457 | 1,779 | 1,229 | 1,019 | 925 | |||||||||||||||
Goodwill
|
48,937 | 8,181 | 2,933 | 7,135 | 6,575 | |||||||||||||||
Total
Assets Acquired
|
68,212 | 10,895 | 4,238 | 8,193 | 7,500 | |||||||||||||||
Current
liabilities
|
6,447 | 338 | 121 | 139 | - | |||||||||||||||
Long-term
obligations
|
27,764 | - | - | - | - | |||||||||||||||
Total
Liabilities Assumed
|
34,211 | 338 | 121 | 139 | - | |||||||||||||||
Net
Assets Acquired
|
$ | 34,001 | $ | 10,557 | $ | 4,117 | $ | 8,054 | $ | 7,500 | ||||||||||
Net
Cash Paid
|
23,000 | 8,244 | 3,374 | 8,054 | 7,500 | |||||||||||||||
Debt
Issued to Sellers
|
11,001 | - | - | - | - | |||||||||||||||
Equity
Issued
|
- | 2,313 | 743 | - | - |
2009
|
2010
|
|||||||||||||||||||||||||||||||
Third Quarter
|
LEDS
|
Recon
|
TAG
|
Insight
|
KEYW
|
ADJ
|
Total
|
Total
|
||||||||||||||||||||||||
Revenue
|
1,776 | 3,429 | 10,547 | 1,386 | 10,058 |
-
|
27,196 | 28,992 | ||||||||||||||||||||||||
COGS
|
849 | 3,275 | 9,039 | 1,029 | 7,668 |
-
|
21,860 | 20,560 | ||||||||||||||||||||||||
Gross
profit
|
927 | 154 | 1,508 | 357 | 2,390 | - | 5,336 | 8,432 | ||||||||||||||||||||||||
Operating
expenses
|
785 | - | 887 | 162 | 4,827 | 1,154 | 7,815 | 8,721 | ||||||||||||||||||||||||
Operating
income
|
142 | 154 | 621 | 195 | (2,437 | ) | (1,154 | ) | (2,479 | ) | (289 | ) | ||||||||||||||||||||
Non-operating
expense(income)
|
- | - | (13 | ) | - | (76 | ) | 625 | 536 | (7,760 | ) | |||||||||||||||||||||
Income(loss)
before taxes
|
142 | 154 | 634 | 195 | (2,361 | ) | (1,779 | ) | (3,015 | ) | 7,471 | |||||||||||||||||||||
Tax
expense(benefit)
|
- | - | (652 | ) | - | (652 | ) | 3,063 | ||||||||||||||||||||||||
Net
income(loss)
|
142 | 154 | 634 | 195 | (1,709 | ) | (1,779 | ) | (2,363 | ) | 4,408 |
2010 YTD
|
||||||||||||||||||||
TAG
|
Insight
|
KEYW
|
ADJ
|
Total
|
||||||||||||||||
Revenue
|
3,854 | 1,066 | 78,651 |
-
|
83,571 | |||||||||||||||
COGS
|
3,227 | 904 | 55,631 |
-
|
59,762 | |||||||||||||||
Gross
profit
|
627 | 162 | 23,020 | - | 23,809 | |||||||||||||||
Operating
expenses
|
720 | 204 | 23,102 | 850 | 24,876 | |||||||||||||||
Operating
income
|
(93 | ) | (42 | ) | (82 | ) | (850 | ) | (1,067 | ) | ||||||||||
Non-operating
(income)expense
|
(5 | ) | - | (16,696 | ) | 500 | (16,201 | ) | ||||||||||||
(Loss)income
before taxes
|
(88 | ) | (42 | ) | 16,614 | (1,350 | ) | 15,134 | ||||||||||||
Tax
expense
|
- | - | 6,866 | - | 6,866 | |||||||||||||||
Net
(loss)income
|
(88 | ) | (42 | ) | 9,748 | (1,350 | ) | 8,268 |
2009 YTD
|
||||||||||||||||||||||||||||||||
LEDS
|
ESD
|
Recon
|
TAG
|
Insight
|
KEYW
|
ADJ
|
Total
|
|||||||||||||||||||||||||
Revenue
|
5,525 | 3,513 | 11,311 | 39,482 | 3,683 | 26,942 | - | 90,456 | ||||||||||||||||||||||||
COGS
|
2,639 | 2,068 | 10,474 | 33,185 | 2,702 | 19,701 | - | 70,769 | ||||||||||||||||||||||||
Gross
profit
|
2,886 | 1,445 | 837 | 6,297 | 981 | 7,241 | - | 19,687 | ||||||||||||||||||||||||
Operating
expenses
|
2,405 | 1,167 | - | 3,177 | 590 | 9,507 | 3,462 | 20,308 | ||||||||||||||||||||||||
Operating
income
|
481 | 278 | 837 | 3,120 | 391 | (2,266 | ) | (3,462 | ) | (621 | ) | |||||||||||||||||||||
Non-operating
expense(income)
|
- | 27 | - | (28 | ) | (1 | ) | 772 | 1,875 | 2,645 | ||||||||||||||||||||||
Income(loss)
before taxes
|
481 | 251 | 837 | 3,148 | 392 | (3,038 | ) | (5,337 | ) | (3,266 | ) | |||||||||||||||||||||
Tax
benefit
|
- | - | - | - | - | (546 | ) | - | (546 | ) | ||||||||||||||||||||||
Net
income(loss)
|
481 | 251 | 837 | 3,148 | 392 | (2,492 | ) | (5,337 | ) | (2,720 | ) |
3.
|
FAIR
VALUE MEASUREMENTS
|
Level 1
|
Valuations
for assets and liabilities traded in active exchange
markets. Valuations are obtained from available pricing sources
for market transactions involving identical assets or
liabilities.
|
Level 2
|
Valuations
for assets and liabilities traded in less active dealer or broker
markets. Valuations are obtained from third party pricing
services for identical or comparable assets or liabilities which use
observable inputs other than Level 1 prices, such as quoted prices for
similar assets or liabilities; quoted prices in active markets that are
not active; or other inputs that are observable or can be corroborated by
observable market data for substantially the full term of the assets or
liabilities.
|
Level 3
|
Unobservable
inputs that are supported by little or no market activity and that are
significant to the fair value of the assets or
liabilities.
|
4.
|
ACCOUNTS
RECEIVABLE
|
September 30,
|
December 31,
|
|||||||
|
2010
|
2009
|
||||||
Accounts Receivable
|
||||||||
Billed
AR
|
$ | 21,256 | $ | 5,068 | ||||
Unbilled
AR
|
459 | 4,341 | ||||||
Other
|
129 | - | ||||||
Total
AR
|
$ | 21,844 | $ | 9,409 |
5.
|
INVENTORIES
|
6.
|
PREPAID
EXPENSES
|
7.
|
PROPERTY
AND EQUIPMENT
|
September
30,
|
December
31,
|
|||||||
Property
& Equipment
|
2010
|
2009
|
||||||
Buildings
& Improvements
|
$ | 362 | $ | 123 | ||||
Manufacturing
Equipment
|
1,251 | 430 | ||||||
Office
Equipment
|
2,108 | 1,210 | ||||||
Total
|
$ | 3,721 | $ | 1,763 | ||||
Accumulated
Depreciation
|
(863 | ) | (333 | ) | ||||
Property
& Equipment, net
|
$ | 2,858 | $ | 1,430 |
8.
|
AMORTIZATION
OF INTANGIBLE ASSETS
|
September 30,
|
||||||||||||||||||
2010
|
||||||||||||||||||
Gross Book
|
Net Book
|
Accumulated
|
Useful life
|
|||||||||||||||
Acquisition
|
Intangible
|
Value
|
Value
|
Amortization
|
In years
|
|||||||||||||
S&H
|
Contracts
-Fixed Price Level of Effort
|
1,606 | 937 | 669 | 7 | |||||||||||||
S&H
|
Proposed
New business
|
3 | - | 3 | 2 | |||||||||||||
ICCI
|
Contracts
-Fixed Price Level of Effort
|
1,181 | 686 | 495 | 5 | |||||||||||||
ICCI
|
Contracts
-T&M and IDIQ
|
3,018 | 704 | 2,314 | 6 | |||||||||||||
ESD
|
Contracts
|
1,207 | 919 | 288 | 5 | |||||||||||||
ESD
|
New
Business & Non-compete
|
22 | - | 22 | 1 | |||||||||||||
LEDS
|
Contracts
|
1,019 | 509 | 510 | 3 | |||||||||||||
GD
|
Contracts
|
925 | 536 | 389 | 3 | |||||||||||||
TAG
|
Contracts
|
10,457 | 8,350 | 2,107 | 3 | |||||||||||||
IIT
|
Contracts
|
1,615 | 1,323 | 292 | 3 | |||||||||||||
IIT
|
Tradename
|
182 | 149 | 33 | 3 | |||||||||||||
14,114 |
9.
|
DEBT
|
10.
|
SHARE-BASED
COMPENSATION
|
Option
|
Weighted Average
|
|||||||||||
Number of Shares
|
Exercise Price
|
Exercise Price
|
||||||||||
Outstanding,
January 1, 2010
|
1,032,250 | |||||||||||
Granted
|
403,500 | $ | 5.50 - $10.00 | $ | 8.31 | |||||||
Exercised
|
(250 | ) | $ | 5.50 | $ | 5.50 | ||||||
Cancelled
|
(65,125 | ) | $ | 5.00 - $9.25 | $ | 5.67 | ||||||
Options
Outstanding, September 30, 2010
|
1,370,375 |
Total Options Outstanding and Exercisable - All Plans
|
||||||||||||||
Exercise
|
Shares
|
Shares
|
Weighted Average
|
|||||||||||
Price
|
Outstanding
|
Exercisable
|
Remaining Life (yrs)
|
|||||||||||
$ | 5.00 | 155,000 | 82,072 | 8.0 | ||||||||||
$ | 5.50 | 933,750 | 328,296 | 9.1 | ||||||||||
$ | 9.25 | 197,125 | 49,286 | 9.6 | ||||||||||
$ | 10.00 | 84,500 | 21,126 | 9.8 | ||||||||||
1,370,375 | 480,780 |
2009
Plan
|
||||
Total
options available to issue
|
1,864,464 | |||
Total
options outstanding or exercised
|
636,875 | |||
Total
options remaining
|
1,227,589 |
11.
|
WARRANTS
|
Warrants Exercisable and
Outstanding
|
||||||||||||||
Exercise
|
Warrants
|
Warrants
|
Weighted Average
|
|||||||||||
Price
|
Outstanding
|
Exercisable
|
Remaining Life (yrs)
|
|||||||||||
$ | 4.00 | 2,198,625 | 2,198,625 | 4.8 | ||||||||||
$ | 5.50 | 2,400,181 | 2,400,181 | 8.9 | ||||||||||
$ | 9.25 | 215,000 | 215,000 | 9.6 | ||||||||||
4,813,806 | 4,813,806 |
12.
|
SUBSEQUENT
EVENTS
|
ITEM
2.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
|
·
|
providing
engineering services and solutions that help our customers to solve
discreet and complex cybersecurity, cyber superiority, and intelligence
challenges;
|
|
·
|
providing
specialized training, field support, and test and evaluation
services;
|
|
·
|
collecting
data and information in cyberspace, encompassing the entire
electromagnetic spectrum;
|
|
·
|
processing
data and information from cyberspace to make it accessible to a wide range
of analytical needs and resources;
|
|
·
|
analyzing
data and information that have been collected, processed, correlated, and
made easily accessible to transform them into usable information for our
customers; and
|
|
·
|
impacting,
or creating integrated intelligence data and information that is useful in
observing, preventing, and responding to known and emerging threat events,
actions and agents on a global scale, often in real
time.
|
Three Months Ended September 30,
|
||||||||||||||||||||||||
2010
|
|
2009
|
Pro Forma 2009
|
|||||||||||||||||||||
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
Revenue
|
$ | 28,992 | 100 | % | $ | 10,058 | 100 | % | $ | 27,196 | 100 | % | ||||||||||||
Gross
Profit
|
$ | 8,432 | 29 | % | $ | 2,390 | 24 | % | $ | 5,336 | 20 | % | ||||||||||||
Loss
from Operations
|
$ | (289 | ) | -1 | % | $ | (2,437 | ) | -24 | % | $ | (2,479 | ) | -9 | % | |||||||||
Non-Operating
Income(Expense)
|
$ | 7,760 | 27 | % | $ | 76 | 1 | % | $ | (536 | ) | -2 | % |
Nine Months Ended September 30,
|
||||||||||||||||||||||||
2010
|
2009
|
Pro Forma 2009
|
||||||||||||||||||||||
(unaudited)
|
(unaudited)
|
(unaudited)
|
||||||||||||||||||||||
Revenue
|
$ | 78,651 | 100 | % | $ | 26,942 | 100 | % | $ | 90,456 | 100 | % | ||||||||||||
Gross
Profit
|
$ | 23,020 | 29 | % | $ | 7,241 | 27 | % | $ | 19,687 | 22 | % | ||||||||||||
Loss
from Operations
|
$ | (82 | ) | 0 | % | $ | (2,266 | ) | -8 | % | $ | (621 | ) | -1 | % | |||||||||
Non-Operating
Income(Expense)
|
$ | 16,696 | 21 | % | $ | (772 | ) | -3 | % | $ | (2,645 | ) | -3 | % |
ITEM
3.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
ITEM
4.
|
CONTROLS
AND PROCEDURES
|
ITEM 1.
|
LEGAL
PROCEEDINGS
|
ITEM 1A.
|
RISK
FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY
SECURITIES AND USE OF
PROCEEDS
|
ITEM
6.
|
EXHIBITS
|
3.1
|
Form
of Amended and Restated Articles of Incorporation of the Company
(1)
|
|
3.2
|
Form
of Amended and Restated Bylaws of the Company (1)
|
|
3.3
|
Articles
of Incorporation of the Company, as filed on December 29, 2009
(1)
|
|
3.4
|
Bylaws
of the Corporation (1)
|
|
3.5
|
Articles
of Merger of The KEYW Merger Subsidiary, Inc. with and into The KEYW
Corporation, as filed on December 29, 2009, and Certificate of Correction
thereto (1)
|
|
3.6
|
Amendment
to Bylaws of the Corporation (1)
|
|
10.1*
|
The
KEYW Corporation 2008 Stock Incentive Plan (1)
|
|
10.2*
|
Form
of Incentive Stock Option Agreement for grants pursuant to The KEYW
Corporation 2008 Stock Incentive Plan (1)
|
|
10.3*
|
Form
of Non-Qualified Stock Option Agreement for grants pursuant to The KEYW
Corporation 2008 Stock Incentive Plan (1)
|
|
10.4*
|
Form
of Restricted Stock Agreement for grants pursuant to The KEYW Corporation
2008 Stock Incentive Plan (1)
|
|
10.5*
|
The
KEYW Holding Corporation 2009 Stock Incentive Plan (1)
|
|
10.6*
|
Form
of Incentive Stock Option Agreement for grants pursuant to The KEYW
Holding Corporation 2009 Stock Incentive Plan (1)
|
|
10.7*
|
Form
of Non-Qualified Stock Option Agreement for grants pursuant to The KEYW
Holding Corporation 2009 Stock Incentive Plan (1)
|
|
10.8*
|
Form
of Restricted Stock Agreement for grants pursuant to The KEYW Holding
Corporation 2009 Stock Incentive Plan (1)
|
|
10.9*
|
Form
of The KEYW Corporation Non-Qualified Stock Options Agreement for non-plan
grants (1)
|
|
10.10*
|
Form
of The KEYW Corporation Restricted Stock Agreement for non-plan grants
(1)
|
|
10.11*
|
Long-Term
Incentive Plan (1)
|
|
10.12*
|
Annual
Incentive Plan (1)
|
|
10.13*
|
Employment
Agreement, dated June 16, 2010, between The KEYW Corporation and
Kimberly DeChello (1)
|
|
10.14*
|
Employment
Agreement, dated June 16, 2010, between The KEYW Corporation and Frederick
Funk (1)
|
|
10.15*
|
Employment
Agreement, dated June 16, 2010, between The KEYW Corporation and Edwin
Jaehne (1)
|
|
10.16*
|
Employment
Agreement, dated June 16, 2010, between The KEYW Corporation and John
Krobath (1)
|
|
10.17*
|
Employment
Agreement, dated June 16, 2010, between The KEYW Corporation and Leonard
E. Moodispaw (1)
|
ITEM 6.
|
EXHIBITS (Continued)
|
|
10.18*
|
Employment
Agreement, dated June 16, 2010, between The KEYW Corporation and Mark
Willard (1)
|
|
10.19
|
Amended
and Restated Registration Rights Agreement, dated as of May 29, 2009,
between the Company and certain stockholders named therein.
(1)
|
|
10.20
|
Form
of Amended and Restated Warrant (1)
|
|
10.21
|
Credit
and Security Agreement, dated February 22, 2010, by and between The KEYW
Holding Corporation, The KEYW Corporation, Integrated Computer Concepts,
Incorporated, The Analysis Group, LLC and S&H Enterprises of Central
Maryland, Inc., as borrowers, and Bank of America, N.A., as lender.
(1)
|
|
10.22
|
First
Amendment to Credit and Security Agreement and Joinder, Assumption and
Ratification Agreement, dated March 16, 2010, by and among The KEYW
Holding Corporation, The KEYW Corporation, Integrated Computer Concepts,
Incorporated, The Analysis Group, LLC and S&H Enterprises of Central
Maryland, Inc., as original borrowers, Insight Information Technology,
LLC, as additional borrower, and Bank of America, N.A., as lender.
(1)
|
|
10.23
|
Covenant
Not to Convey and Negative Pledge Agreement, dated February 22, 2010 by
and among The KEYW Corporation, The KEYW Holding Corporation, Integrated
Computer Concepts, Incorporated, The Analysis Group, LLC and S&H
Enterprises of Central Maryland, Inc., as borrowers, and Bank of America,
N.A., as lender. (1)
|
|
10.24
|
Revolving
Loan Note, dated February 22, 2010 (1)
|
|
10.25
|
Term
Loan Note, dated February 22, 2010 (1)
|
|
10.26
|
Contribution
Agreement, dated February 22, 2010, by and among TAG Holdings LLC, The
Analysis Group, LLC, The KEYW Holding Corporation, The KEYW Corporation,
and certain other parties. (1)
|
|
10.27
|
Subordinated
Unsecured Promissory Note, dated February 22, 2010, in the amount of
$8,251,076 (1)
|
|
10.28
|
Subordinated
Unsecured Promissory Note, dated February 22, 2010, in the amount of
$3,400,000 (1)
|
|
10.29
|
Form
of Note for IIT financing (1)
|
|
10.31
|
Amended
and Restated Stockholders Agreement dated as of May 29, 2009 between the
Company and certain stockholders named therein (1)
|
|
10.32*
|
The
KEYW Holding Corporation 2010 Employee Stock Purchase Plan
(1)
|
|
21.1
|
Subsidiaries
of the Registrant (1)
|
|
31.1
|
Certification
of Chief Executive Officer Pursuant to Section 302 of the Sarbanes –Oxley
Act of 2002 (filed herewith)
|
|
31.2
|
Certification
of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 (filed herewith)
|
|
32.1
|
Certification
of the Chief Executive Officer and the Chief Financial Officer Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (filed
herewith)
|
(1)
|
Incorporated
by reference to the corresponding Exhibit number to the Registrant’s
Registration Statement on Form S-1, as amended (File No.
333-16768).
|
By:
|
/s/ Leonard E. Moodispaw
|
|
Leonard E. Moodispaw | ||
President and Chief Executive Officer |
By:
|
/s/ John E. Krobath
|
|
John E. Krobath | ||
Chief Financial Officer |