SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 10-Q/A-1
Amendment No. 1 TO REPORT ON FORM 10-Q
------------------
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
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 Q4823
ACME UNITED CORPORATION
(Exact name of registrant as specified in its charter)
------------------
CONNECTICUT 06-0236700
----------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1931 BLACK ROCK TURNPIKE, Fairfield, Connecticut 06825
- ------------------------------------------------ -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (203) 332-7330
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. Yes |X| No |_|
Registrant had 3,397,251 shares outstanding as of October 15, 2002 of its $2.50
par value Common Stock.
(1)
AMENDMENTS TO 10-Q
This amendment No. 1 to Form 10-Q ("Amendment No. 1") is being filed
for the purpose of providing additional information. Specifically, Item 3,
Quantitative and Qualitative Disclosure About Market Risk and Item 4, Controls
and Procedures, are being added to Part I.
(2)
AMENDED AND RESTATED FORM 10-Q:
-------------------------------
The following sets forth the amended and restated Quarterly Report on
Form 10-Q for the quarter ended September 30, 2002, giving effect to all the
changes contained in this Amendment No. 1 to the Form 10-Q:
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 10-Q/A-1
Amendment No. 1 TO REPORT ON FORM 10-Q
------------------
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
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 Q4823
ACME UNITED CORPORATION
(Exact name of registrant as specified in its charter)
------------------
CONNECTICUT 06-0236700
----------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1931 BLACK ROCK TURNPIKE, Fairfield, Connecticut 06825
- ------------------------------------------------ -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (203) 332-7330
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. Yes |X| No |_|
Registrant had 3,397,251 shares outstanding as of October 15, 2002 of its $2.50
par value Common Stock.
(3)
ACME UNITED CORPORATION
Page
----
Part I-- FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets....................... 5
Condensed Consolidated Statements of Operations
and Comprehensive Income................................. 7
Condensed Consolidated Statements of Cash Flows............. 8
Notes to Condensed Consolidated Financial Statements........ 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations............... 11
Item 3. Quantitative and Qualitative Disclosure About Market Risk..... 14
Item 4. Controls and Procedures....................................... 14
Part II -- OTHER INFORMATION
Item 1. Legal Proceedings............................................. 15
Item 2. Changes in Securities.......................................... 15
Item 3. Defaults Upon Senior Securities................................ 15
Item 4. Submission of Matters to a Vote of Security Holders............ 15
Item 5. Other Information.............................................. 15
Item 6. Exhibits and Reports on Form 8-K............................... 15
Signatures............................................................. 16
(4)
PART I. FINANCIAL INFORMATION
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(all amounts in thousands, except per share data)
September 30 December 31
2002 2001
------------ -----------
ASSETS
Current assets:
Cash and cash equivalents $ 594 $ 172
Accounts receivable, less allowance 7,927 6,439
Inventories:
Finished goods 4,712 6,554
Work in process 449 404
Raw materials and supplies 1,431 1,845
--------------- --------------
6,592 8,803
Prepaid expenses and other current assets 747 807
Deferred income taxes 241 241
--------------- --------------
Total current assets 16,101 16,462
--------------- --------------
Property, plant and equipment:
Land 187 170
Buildings 2,215 2,072
Machinery and equipment 6,048 5,610
--------------- --------------
8,450 7,852
Less accumulated depreciation 6,010 5,594
--------------- --------------
2,440 2,258
Other assets 1,295 1,296
Goodwill 89 157
--------------- --------------
Total assets $ 19,925 $ 20,173
=============== ==============
See notes to condensed consolidated financial statements.
(5)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS - continued
(UNAUDITED)
(all amounts in thousands, except per share data)
September 30 December 31
2002 2001
------------ -----------
LIABILITIES
Current liabilities:
Notes payable $ 448 $ 464
Accounts payable 1,457 2,038
Other accrued liabilities 1,945 2,821
Current portion of long-term debt 2,578 2,377
--------------- --------------
Total current liabilities 6,428 7,700
Long-term debt, less current portion 3,635 2,875
Deferred income taxes 258 521
Other 241 405
--------------- --------------
Total liabilities 10,562 11,501
STOCKHOLDERS' EQUITY Common stock, par value $2.50:
authorized 8,000,000 shares;
issued 3,613,312 shares,
including treasury stock 9,033 9,033
Treasury stock, at cost 216,061 shares in 2002 and
203,261 shares in 2001 (985) (937)
Additional paid-in capital 2,038 2,038
Retained earnings 748 129
Accumulated other comprehensive loss:
Translation adjustment (1,424) (1,470)
Derivative financial instrument losses (47) (121)
--------------- --------------
Total stockholders' equity 9,363 8,672
--------------- --------------
Total liabilities and stockholders' equity $ 19,925 $ 20,173
=============== ==============
See notes to condensed consolidated financial statements.
(6)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME
(UNAUDITED)
(all amounts in thousands of dollars, except per share amounts)
Three Months Ended Nine Months Ended
September 30 September 30
----------------------- -------------------------
2002 2001 2002 2001
---------- ----------- ------------ ------------
Net sales $ 7,867 $ 8,265 $ 24,020 $ 25,070
Costs and expenses:
Cost of goods sold:
Before inventory write-off related to restructuring 5,204 5,543 15,843 17,233
Inventory write-off related to restructuring - - 206 -
---------- ----------- ------------ ------------
5,204 5,543 16,049 17,233
Selling, general and administrative expenses 2,688 2,085 7,023 6,174
Restructuring charges - - 349 -
---------- ----------- ------------ ------------
7,892 7,628 23,421 23,407
---------- ----------- ------------ ------------
Income (loss) before non operating items (25) 637 599 1,663
Non operating items:
Interest expense 180 211 487 621
Other (income)expense (101) 8 (221) (95)
---------- ----------- ------------ ------------
79 219 266 526
---------- ----------- ------------ ------------
Income (loss) before income taxes (104) 418 333 1,137
Income tax (benefit) expense (374) 13 (286) 37
---------- ----------- ------------ ------------
Net income 270 405 619 1,100
Other comprehensive (expense) income -
Foreign currency translation 130 (30) 46 (77)
Cumulative effect of change in accounting for
derivative financial instruments - - - (104)
Change in fair value of derivative financial instrument
less deferred income taxes of $13 and $42 for the three
and nine month periods ended September 30, 2002 29 (52) 74 (103)
Unrealized gain on available-for-sale marketable equity security - (274) - -
---------- ----------- ------------ ------------
Comprehensive income $ 429 $ 49 $ 739 $ 816
========== =========== ============ ============
Basic earnings per share $ 0.08 $ 0.12 $ 0.18 $ 0.31
========== =========== ============ ============
Diluted earnings per share $ 0.08 $ 0.11 $ 0.17 $ 0.30
========== =========== ============ ============
Weighted average number of common shares outstanding-
denominator used for basic per share computations 3,402 3,490 3,406 3,502
Weighted average number of dilutive stock options
outstanding 161 114 184 109
---------- ----------- ------------ ------------
Denominator used for diluted per share computations 3,563 3,604 3,590 3,611
========== =========== ============ ============
See notes to condensed consolidated financial statements
(7)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
(all amounts in thousands of dollars)
Nine Months Ended
September 30
-----------------------------
2002 2001
-------------- --------------
Operating Activities:
Net income $ 619 $ 1,100
Adjustments to reconcile net income
to net cash used by operating activities:
Depreciation 348 505
Amortization 93 101
Deferred income taxes (276) -
Gain on sale of marketable equity securities - (475)
Non-cash restructuring charges 300 -
Gain on sale of property, plant, and equipment (37) -
Loss on disposals of property, plant, and equipment - 334
Changes in operating assets and liabilities:
Accounts receivable (1,504) (2,846)
Inventories 2,005 1,325
Prepaid expenses and other current assets 60 (383)
Other assets (31) (50)
Accounts payable (596) 144
Other accrued liabilities (1,030) (113)
-------------- --------------
Total adjustments (668) (1,458)
-------------- --------------
Net cash used by operating activities (49) (358)
-------------- --------------
Investing Activities:
Capital expenditures (465) (202)
Proceeds from the sales of property, plant, and equipment 37 140
Proceeds from sale of marketable equity securities - 475
-------------- --------------
Net cash (used) provided by investing activities (429) 413
-------------- --------------
Financing Activities:
Net short-term borrowings 971 886
Payments of long-term debt (9) (59)
Debt issuance costs (60) (27)
Purchase of 12,800 Common Shares in 2002 and 55,200
Common Shares in 2001 for treasury (48) (161)
-------------- --------------
Net cash provided by financing activities 854 639
-------------- --------------
Effect of exchange rate changes 46 (77)
-------------- --------------
Net change in cash and cash equivalents 422 617
Cash and cash equivalents at beginning of period 172 22
-------------- --------------
Cash and cash equivalents at end of period $ 594 $ 639
============== ==============
See notes to condensed consolidated financial statements
(8)
Notes to CONDENSED CONSOLIDATED Financial Statements
(UNAUDITED)
Note 1 -- Basis of Presentation
In the opinion of management, the accompanying condensed consolidated financial
statements include all adjustments necessary to present fairly the financial
position, results of operations and cash flows. However, the financial
statements do not include all of the disclosures normally required by accounting
principles generally accepted in the United States of America or those normally
made in the Company's annual report on Form 10-K. Please refer to the Company's
annual report on Form 10-K for the year ended December 31, 2001 for such
disclosures. The condensed consolidated balance sheet as of December 31, 2001
was derived from the audited consolidated balance sheet as of that date. The
results of operations for interim periods are not necessarily indicative of the
results to be expected for the full year.
The Company has reclassified certain amounts in prior periods to conform to the
current presentation.
Note 2 -- Contingencies
The Company has been involved in certain environmental and other matters.
Additionally, the Company has been involved in numerous legal actions relating
to the use of certain latex products, which the Company distributes, but does
not manufacture. The Company is one of many defendants. The Company has been
released from the majority of the lawsuits. While two lawsuits remain, they are
still in preliminary stages and it has not been determined whether the Company's
products were involved. Based on information available, the Company believes
there will not be a material adverse impact on financial position, results of
operations, or liquidity, from these matters, either individually or in
aggregate.
Note 3 -- Restructuring Charges
Through the third quarter of 2002, approximately $555,000 was charged against
earnings as a result of certain strategic and operating changes initiated by the
Company's management related to liquidating Acme United Limited (AUL), a
subsidiary located in the United Kingdom. The restructuring charges consisted of
a write-down of inventory of $206,000, accounting and legal costs of $95,000,
lease cancellation costs of $90,000, a write-off of goodwill of $69,000,
severance costs of $55,000, other closing costs of $22,000, a write-off of
uncollectible account receivable of $9,000 and write-offs of equipment of
$9,000. Approximately $36,000 remained in accrued restructuring charges at
September 30, 2002 primarily related to accounting and legal costs. During the
first nine months of 2002, the Company terminated five employees in the UK and
paid severance costs related to those terminations of $55,000. There will be no
further terminations or severance costs related to the restructuring. Also,
approximately $59,000 of accounting and legal costs have been paid.
Note 4 -- Change in Accounting Estimate
The Company changed its estimated effective income tax rate in the third quarter
as a result of a reduction in the anticipated annual taxable income in the US.
As a result, the Company recorded a benefit for the change in estimate of
approximately $395,000 ($.12 a share) in the third quarter. The income tax
benefit is primarily due to income tax benefits in the US attributed to the
liquidation of AUL.
Note 5 -- Debt
On August 2, 2002, the Company entered into a new revolving loan agreement with
Wachovia Bank, N.A.. This agreement allows for borrowings up to a maximum of
$10,000,000 based on a formula, which applies specific percentages to balances
of accounts receivable and inventory. Interest is payable monthly and is charged
at the LIBOR rate plus 1.75 percent. All outstanding borrowings are due on July
31, 2005. The Company also transferred its interest rate swap agreement, which
fixes the effective interest rate at 7.18 percent for $3,500,000 of debt under
the agreement. The swap agreement expires January 19, 2003.
(9)
Note 6 -- New Accounting Standards
As of January 1, 2002, the Company adopted Financial Accounting Standards Board
Statement No. 142, Goodwill and Other Intangible Assets (FAS 142) and as such no
longer amortizes goodwill but rather tests it annually for impairment. There was
no impairment of goodwill at January 1, 2002. Had Statement No. 142 been in
effect as of the beginning of 2001, amortization expense for the three and nine
month periods ended September 30, 2001 would have been reduced by $7,000 and
$21,000, respectively, increasing net income by the same amount.
As of January 1, 2002, the Company also adopted the Emerging Issues Task Force
consensus No. 00-25, Vendor Income Statement Characterization of Consideration
Paid to a Reseller of a Vendor's Products (EITF 00-25). As such, the Company
recognizes consideration paid to a reseller of its product as a reduction of the
selling price of its products and, therefore, reduces revenue in the Company's
statement of operations. The adoption of EITF 00-25 had no effect on net income.
Selling, general and administrative expenses for the three and nine month
periods ended September 30, 2001 have been reclassified to conform to the new
classification resulting in a $749,000 and $2,536,000 decrease of selling,
general and administrative expenses and net sales for these respective periods.
As of January 1, 2001, the Company adopted Financial Accounting Standards Board
Statement No. 133, Accounting for Derivative Instruments and Hedging Activities,
which was issued in June 1998 and its amendments Statements 137, Accounting for
Derivative Instruments and Hedging Activities--Deferral of the Effective Date of
FASB Statement No. 133, and 138, Accounting for Derivative Instruments and
Certain Hedging Activities, issued in June 1999 and June 2000, respectively
(collectively referred to as Statement 133).
As a result of adopting Statement 133, the Company recognizes all derivative
financial instruments, such as interest rate swap contracts and foreign exchange
contracts, in the consolidated financial statements at fair value regardless of
the purpose or intent for holding the instrument. Changes in the fair value of
derivative financial instruments are either recognized periodically in income or
in shareholders' equity as a component of comprehensive income depending on
whether the derivative financial instrument qualifies for hedge accounting, and
if so, whether it qualifies as a fair value hedge or cash flow hedge. Generally,
changes in fair values of derivatives accounted for as fair value hedges are
recorded in income along with the portions of the changes in the fair values of
the hedged items that relate to the hedged risk(s). Changes in fair values of
derivatives accounted for as cash flow hedges, to the extent they are effective
as hedges, are recorded in other comprehensive income net of deferred taxes.
Changes in fair value of derivatives used as hedges of the net investment in
foreign operations are reported in other comprehensive income as part of the
cumulative translation adjustment. Changes in fair values of derivatives not
qualifying as hedges are reported in income.
The adoption of Statement 133, resulted in a cumulative effect of an accounting
change of $104,277 decrease to other comprehensive income.
(10)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
For the Three and Nine Months Ended September 30, 2002
Results of Operations
Special Event
During the second quarter of 2002, the Company initiated liquidation procedures
for Acme United Limited (AUL), a subsidiary located in the United Kingdom. For
the year ended December 31, 2001, AUL recorded a net loss of $495,000 on net
sales of $2.0 million, representing a sales decline of approximately $1.2
million or 38% from the prior year. Through September 2002, AUL recorded a net
loss of approximately $222,000 before one time restructuring charges of
$555,000. The restructuring charges are comprised mainly of severance, lease
termination costs, and inventory write-offs.
Net Sales
Traditionally, the Company's sales are stronger in the second and third
quarters, and weaker in the first and fourth quarters of the fiscal year due to
the seasonal nature of the business specific to the back-to-school season.
Consolidated net sales for the quarter ended September 30, 2002 were $7,867,000
compared with $8,265,000 for 2001, a 5% decrease. Net sales for the first nine
months of 2002 were $24,020,000 compared with $25,070,000 for 2001, a 4%
decrease. The sales decrease was mainly driven by a sales decline of 55% in the
United Kingdom as the business was liquidated. Domestic sales were 1% higher in
the first nine months of 2002 compared with the same period in 2001.
Gross Profit
The gross profit for the third quarter of 2002 was $2,663,000 (33.9% of net
sales) compared to $2,722,000 (32.9% of net sales) for the third quarter of
2001. Gross profit for the first nine months of 2002 was 33.2% of net sales
compared to 31.3% in the same period of 2001. Excluding the inventory write-down
associated with the AUL liquidation gross profit was 34.0% of net sales for the
first nine months of 2002. The introduction of new products and improved
operating efficiencies in the USA were the main reasons for the improved gross
margins.
Selling, General and Administrative Expenses
Selling, general and administrative ("SG&A") expenses for the third quarter of
2002 were $2,688,000 (34.2% of net sales) compared with $2,085,000 (25.6% of net
sales) for the same period of 2001, an increase of $603,000. Major contributors
to the spending increase were market research, new product development, fees in
connection with the new global debt facility and one-time personnel expenses.
SG&A expenses were 29.2% of net sales for the first nine months of 2002 versus
24.6% in the comparable period of 2001. The increase is primarily attributable
to the same issues mentioned for the third quarter of 2002.
Interest Expense
Interest expense for the first nine months of 2002 was $487,000, compared with
$621,000 for 2001, a $134,000 decrease. This is mainly attributable to the
decline in debt. Total debt declined to $6.6 million at September 30, 2002
compared to $8.3 million at September 30, 2001.
Income Taxes
The Company changed its estimated effective income tax rate in the third quarter
as a result of a reduction in the anticipated annual taxable income in the US.
As a result, the Company recorded a benefit for the change in estimate of
approximately $395,000 ($.12 a share) in the third quarter. The income tax
benefit is primarily due to income tax benefits in the US attributed to the
liquidation of AUL.
(11)
Net Income
Net income for the third quarter of 2002 was $270,000, or 8 cents per share
(diluted), compared to a net income of $405,000, or 11 cents per share (diluted)
for the same period of 2001. Net income for the first nine months of 2002 was
$619,000, or 17 cents per share (diluted), compared to a net income of
$1,100,000, or 30 cents per share (diluted) for the same period of 2001.
(12)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS-Continued
For the Nine Months Ended September 30, 2002
Financial Condition
Liquidity and Capital Resources
The Company's working capital, current ratio and long-term debt to equity ratio
follow:
September 30, 2002 December 31, 2001
------------------ ------------------
Working capital................... $9,673,000 $8,762,000
Current ratio..................... 2.51 to 1 2.14 to 1
Long term debt to equity ratio.... .39 .33
During the first nine months of 2002, total debt increased by $962,000 compared
to total debt at December 31, 2001 principally as a result of net additional
short-term borrowings to fund higher accounts receivable due to seasonal sales
volume.
On August 2, 2002, the Company entered into a new revolving loan agreement with
Wachovia Bank, N.A. This agreement allows for borrowings up to a maximum of
$10,000,000 based on a formula, which applies specific percentages to balances
of accounts receivable and inventory. Interest is payable monthly and is charged
at the LIBOR rate plus 1.75 percent. All outstanding borrowings are due on July
31, 2005. The Company also transferred its interest rate swap agreement to
Wachovia Bank, N.A., which fixes the effective interest rate to 7.18 percent for
$3.5 million of debt through January 19, 2003.
Cash expected to be generated from operating activities, together with funds
available under its existing loan agreement, are expected, under current
conditions, to be sufficient to finance the Company's planned operations over
the next twelve months. Over that same period, the Company does not expect to
make significant investments in plant, property, and equipment.
Safe Harbor for Forward-looking Statements
Forward-looking statements in this report, including without limitation,
statements related to the Company's plans, strategies, objectives, expectations,
intentions and adequacy of resources, are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Investors
are cautioned that such forward-looking statements involve risks and
uncertainties including without limitation the following: (i) the Company's
plans, strategies, objectives, expectations and intentions are subject to change
at any time at the discretion of the Company; (ii) the Company's plans and
results of operations will be affected by the Company's ability to manage its
growth and inventory; and (iii) other risks and uncertainties indicated from
time to time in the Company's filings with the Securities and Exchange
Commission.
(13)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS-Continued
For the Nine Months Ended September 30, 2002
Item 3. Quantitative and Qualitative Disclosure About Market Risk
There are no material changes in reported market risks since our most
recent filing on Form 10-K for the year ended December 31, 2001.
Item 4. Controls and Procedures
As of a date within 90 days prior to the date of the filing of this report,
our chief Executive Officer and Chief Financial Officer have reviewed and
evaluated the effectiveness of our disclosure controls and procedures,
which included inquiries made to certain other of our employees. Based on
their evaluation, our Chief Executive Officer and Chief Financial Officer
have each concluded that our disclosure controls and procedures are
effective and sufficient to ensure that we record, process, summarize and
report information required to be disclosed by us in our periodic reports
filed under the Securities and Exchange Commission's rules and forms.
Subsequent to the date of their evaluation, there have not been any
significant changes in our internal controls or in other factors that could
significantly affect these controls, including any corrective action with
regard to significant deficiencies and material weaknesses.
(14)
PART II. OTHER INFORMATION
Item 1 -- Legal Proceedings
None.
Item 2 -- Changes in Securities
None.
Item 3. Defaults Upon Senior Management
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5 -- Other Information
None.
Item 6 -- Exhibits and Reports on Form 8-K
Exhibit 99.1 and 99.2 Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Form 8-K was filed by the Company on September 27, 2002.
(15)
SIGNATURES
Pursuant to the requirements 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.
ACME UNITED CORPORATION
By /s/ WALTER C. JOHNSEN
------------------------------
Walter C. Johnsen
President and
Chief Executive Officer
Dated: January 8, 2003
By /s/ PAUL G. DRISCOLL
------------------------------
Paul G. Driscoll
Vice President and
Chief Financial Officer
Dated: January 8, 2003
(16)
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, WALTER C. JOHNSEN, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Acme United
Corporation;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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 quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures 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 in which this
quarterly report is being reported;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to filing date of
this quarterly report September 30, 2002; and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of September 30, 2002;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee
of registrant's board of directors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
By /s/ WALTER C. JOHNSEN
------------------------------
Walter C. Johnsen
President and
Chief Executive Officer
Dated: January 8, 2003
(17)
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, PAUL G. DRISCOLL, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Acme United
Corporation;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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 quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures 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 in which this
quarterly report is being reported;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date 90 days prior to filing date of this
quarterly report September 30, 2002; and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of September 30, 2002;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee
of registrant's board of directors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
By /s/ PAUL G. DRISCOLL
------------------------------
Paul G. Driscoll
Vice President and
Chief Financial Officer
Dated: January 8, 2003
(18)
Exhibit 99.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
The undersigned officer of Acme United Corporation (the "Company") hereby
certifies to my knowledge that the Company's quarterly report on Form 10-Q for
the quarterly period ended September 30, 2002 (the "Report"), as filed with the
Securities and Exchange Commission on the date hereof, fully complies with the
requirements of section 13(a) or 15(b), as applicable, of the Securities
Exchange Act of 1934, as amended, and that the information contained in the
Report fairly presents, in all material respects, the financial condition and
results of operations of the Company. This certification is provided solely
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, and shall not be deemed to be a part of the Report
or "filed" for any purpose whatsoever.
By /s/ WALTER C. JOHNSEN
------------------------------
Walter C. Johnsen
President and
Chief Executive Officer
Dated: January 8, 2003
(19)
Exhibit 99.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
The undersigned officer of Acme United Corporation (the "Company") hereby
certifies to my knowledge that the Company's quarterly report on Form 10-Q for
the quarterly period ended September 30, 2002 (the "Report"), as filed with the
Securities and Exchange Commission on the date hereof, fully complies with the
requirements of section 13(a) or 15(b), as applicable, of the Securities
Exchange Act of 1934, as amended, and that the information contained in the
Report fairly presents, in all material respects, the financial condition and
results of operations of the Company. This certification is provided solely
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, and shall not be deemed to be a part of the Report
or "filed" for any purpose whatsoever.
By /s/ PAUL G. DRISCOLL
------------------------------
Paul G. Driscoll
Vice President and
Chief Financial Officer
Dated: January 8, 2003
(20)