-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Cpa6WwqthV4dznqCbctcIywhWKbb3JK10FLWRz6tCrt1HTehfu7Rh9SzA87GI4/9 qtzpZx//9FAs8S/3Q5T2jQ== 0000741556-02-000018.txt : 20021118 0000741556-02-000018.hdr.sgml : 20021118 20021114182025 ACCESSION NUMBER: 0000741556-02-000018 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20020930 FILED AS OF DATE: 20021114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TECHNOLOGY RESEARCH CORP CENTRAL INDEX KEY: 0000741556 STANDARD INDUSTRIAL CLASSIFICATION: SWITCHGEAR & SWITCHBOARD APPARATUS [3613] IRS NUMBER: 592095002 STATE OF INCORPORATION: FL FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-13763 FILM NUMBER: 02827321 BUSINESS ADDRESS: STREET 1: 5250 140TH AVE NORTH CITY: CLEARWATER STATE: FL ZIP: 34620 BUSINESS PHONE: 8135350572 MAIL ADDRESS: STREET 1: 5250 140TH AVENUE NORTH CITY: CLEARWATER STATE: FL ZIP: 34620 10-Q 1 q10nd2003.txt SECOND QUARTER REPORT ON FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2002 Commission File Number: 0-13763 TECHNOLOGY RESEARCH CORPORATION (Exact name of registrant as specified in its charter) Florida 59-2095002 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No,) 5250 140th Avenue North, Clearwater, Florida 33760 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (727) 535-0572 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 a 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 [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding at October 31, 2002 Common stock, $.51 par value 5,437,497 TECHNOLOGY RESEARCH CORPORATION INDEX Part I - Financial Information Page Item 1. Financial Statements Condensed Consolidated Balance Sheets (unaudited) - September 30, 2002 and March 31, 2002............................. 1 Condensed Consolidated Statements of Operations (unaudited) - Three months and Six months ended September 30, 2002 and September 30, 2001......................... 2 Condensed Consolidated Statements of Cash Flows (unaudited) - Six months ended September 30, 2002 and September 30, 2001........ 3 Notes to Condensed Consolidated Financial Statements (unaudited)......... 4 Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations............................. 5 Item 3 - Quantitative and Qualitative Disclosure Regarding Market Risk... 9 Item 4 - Controls and Procedures......................................... 9 Part II - Other Information Item 1 - Legal Proceedings.............................................. 10 Item 2 - Changes in Securities and Use of Proceeds...................... 10 Item 3 - Defaults Upon Senior Securities................................ 10 Item 4 - Submission of Matters to a Vote of Security Holders............ 10 Item 5 - Other Information.............................................. 10 Item 6 - Exhibits and Reports on Form 8-K............................... 10 Signatures.............................................................. 11 Certifications.......................................................... 12 PART I - FINANCIAL INFORMATION Item 1. Financial Statements TECHNOLOGY RESEARCH CORPORATION AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) September 30 March 31 2002 2002 ----------- --------- ASSETS Current assets: Cash and cash equivalents $ 1,072,437 1,163,099 Accounts receivable, net 2,268,711 2,516,603 Inventories: Raw material 3,036,905 3,130,889 Work in process 297,433 190,348 Finished goods 1,634,644 1,477,494 ---------- ---------- Total inventories 4,968,982 4,798,731 Prepaid expenses 262,135 97,720 Deferred income taxes 143,356 271,569 ---------- ---------- Total current assets 8,715,621 8,847,722 ---------- ---------- Property, plant, and equipment 9,726,120 9,493,313 Less accumulated depreciation 6,156,185 5,795,667 ---------- ---------- Net property, plant, and equipment 3,569,935 3,697,646 ---------- ---------- Non-current deferred income taxes 162,861 162,861 Other assets 50,399 58,708 ---------- ---------- $ 12,498,816 12,766,937 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 511,492 551,300 Accrued expenses 316,541 293,422 Dividends payable 69,178 68,804 Income taxes payable 21,358 - ---------- ---------- Total current liabilities 918,569 913,526 Long-term debt - 500,000 Deferred income - long term 50,000 50,000 ---------- ---------- Total liabilities 968,569 1,463,526 ---------- ---------- Stockholders' equity: Common stock 2,784,088 2,784,088 Additional paid-in capital 7,526,472 7,526,472 Retained earnings 1,259,832 1,032,996 ---------- ---------- 11,570,392 11,343,556 Treasury stock, at cost - 21,500 shares (40,145) (40,145) ---------- ---------- Total stockholders' equity 11,530,247 11,303,411 ---------- ---------- $ 12,498,816 12,766,937 ========== ========== See accompanying notes to condensed consolidated financial statements. - 1 - TECHNOLOGY RESEARCH CORPORATION AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three Months Ended Six Months Ended September 30 September 30 2002 2001 2002 2001 ---------- ---------- ---------- ---------- Operating revenues: Net sales $ 3,904,857 4,802,025 7,742,637 8,880,062 Royalties 63,959 68,646 81,497 97,962 ---------- ---------- ---------- ---------- 3,968,816 4,870,671 7,824,134 8,978,024 ---------- ---------- ---------- ---------- Operating expenses: Cost of sales 2,592,708 3,707,121 5,189,980 6,692,764 Selling, general, and administrative 756,205 828,553 1,541,985 1,653,517 Research, development and engineering 315,213 235,522 600,269 498,668 ---------- ---------- ---------- ---------- 3,664,126 4,771,196 7,332,234 8,844,949 ---------- ---------- ---------- ---------- Operating income 304,690 99,475 491,900 133,075 ---------- ---------- ---------- ---------- Other income (deductions): Interest and sundry income 927 4,935 5,079 6,233 Interest expense - (27,371) (1,153) (59,063) Loss on disposal of assets (10,766) (2,161) (10,669) (2,581) ---------- ---------- ---------- ---------- (9,839) (24,597) (6,743) (55,411) ---------- ---------- ---------- ---------- Earnings before income taxes 294,851 74,878 485,157 77,664 Earnings taxes expense 88,720 18,720 149,571 19,416 ---------- ---------- ---------- ---------- Net earnings $ 206,131 56,158 335,586 58,248 ========== ========== ========== ========== Basic earnings per share $ 0.04 0.01 0.06 0.01 ========== ========== ========== ========== Weighted average number of Common shares outstanding 5,437,497 5,437,497 5,437,497 5,437,497 ========== ========== ========== ========== Diluted earnings per share $ 0.04 0.01 0.06 0.01 ========== ========== ========== ========== Weighted average number of common and equivalent shares outstanding 5,449,788 5,446,850 5,453,601 5,449,590 ========== ========== ========== ========== Dividends paid per share $ 0.01 0.01 0.02 0.02 ========== ========== ========== ========== See accompanying notes to condensed consolidated financial statements. - 2 - TECHNOLOGY RESEARCH CORPORATION AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) Six Months Ended September 30 2002 2001 ---------- ---------- Cash flows from operating activities: Net earnings $ 335,586 58,248 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 464,730 449,521 Amortization 215,646 178,635 Loss on disposal of assets 10,669 2,581 Decrease (increase) in accounts receivable 247,892 (183,292) Decrease in income taxes receivable - 201,752 Decrease (increase) in inventories (170,251) 660,903 Increase in prepaid expenses (380,061) (257,338) Decrease in deferred income taxes 128,213 30,499 Decrease (increase) in other assets 8,309 (13,205) Decrease in accounts payable (39,808) (642,521) Increase (decrease) in accrued expenses 23,119 (29,987) Increase in income taxes payable 21,358 - Decrease in deferred income - (11,765) ---------- ---------- Net cash provided by operating activities 865,402 444,031 ---------- ---------- Cash flows from investing activities: Capital expenditures (347,688) (129,612) ---------- ---------- Net cash used in investing activities (347,688) (129,612) ---------- ---------- Cash flows from financing activities: Principal payments on long-term debt (500,000) - Dividends paid (108,376) (108,377) ---------- ---------- Net cash used in financing activities (608,376) (108,377) ---------- ---------- Increase (decrease) in cash and cash equivalents (90,662) 206,042 Cash and cash equivalents at beginning of period 1,163,099 184,772 ---------- ---------- Cash and cash equivalents at end of period $ 1,072,437 390,814 ========== ========== See accompanying notes to condensed consolidated financial statements. - 3 - TECHNOLOGY RESEARCH CORPORATION AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) September 30, 2002 and March 31, 2002 1. The financial information included herein is unaudited; however, such information reflects all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for the fair statement of results for the interim period. These statements should be read in conjunction with the consolidated financial statements included in the Company's annual report on Form 10-K for the year ended March 31, 2002. The results of operations for the six-month period ended September 30, 2002 are not necessarily indicative of the results to be expected for the full year. 2. Basic earnings per share has been computed by dividing net earnings by the weighted average number of common shares outstanding. Diluted earnings per share has been computed by dividing net earnings by the weighted average number of common and equivalent shares outstanding. Common share equivalents included in the computation represent shares issuable upon exercise of stock options which would have a dilutive effect in periods where there are earnings. For the three-month and six-month periods ended September 30, 2002, 534,750 and 387,250 shares, respectively, were considered anti-dilutive for purposes of calculating earnings per share. For the three-month and six-month periods ended September 30, 2001, 327,000 shares were considered anti-dilutive for purposes of calculating earnings per share. - 4 - Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS The following is management's discussion and analysis of certain significant factors that have affected the Company's financial position and operating results during the periods included in the accompanying condensed consolidated financial statements. Current Three Months and Six Months Ended September 30, 2002 versus September 30, 2001 The Company's operating revenues (net sales and royalties) for the second quarter ended September 30, 2002 were $3,968,816, compared to $4,870,671 reported in the same quarter last year, a decrease of approximately 19%. Net income for the current quarter was $206,131, compared to $56,158, for the same quarter last year, an increase of approximately 267%. Basic and diluted earnings for the current period were $.04 per share compared to $.01 per share for the same quarter last year. The Company's operating revenues (net sales and royalties) for the six-month period ended September 30, 2002 were $7,824,134, compared to $8,978,024 reported in the same period of the prior year, a decrease of approximately 13%. Net earnings for the six-month period was $335,586, compared to $58,248, for the same period in the prior year, an increase of approximately 476%. Basic and diluted earnings for the six-month period were $.06 per share compared to basic and diluted earnings of $.01 per share for the same period last year. The improvement in net earnings for the comparative three-month and six-month periods was the result of increased gross profit margins and lower interest expense. Gross profit margins improved as the result of product mix plus productivity and quality improvements in manufacturing. Interest expense was reduced as a result of the Company remaining debt-free during its second quarter. For the six-month period ended September 30, 2002, commercial sales decreased by $1,390,015, military sales improved by $252,590 and royalty income was down by $16,465 compared to the prior year's period. The decrease in commercial sales was primarily due to competitive pressures and the current weakness in the global economy, which the Company believes will continue to affect commercial sales for the remainder of the fiscal year. Military sales remained strong throughout the second quarter due to direct military shipments of spare parts for existing systems and due to sub-contractor shipments of control devices related to the Tactical Quiet Generator (TQG) programs. The market for the Company's Fire Shield(r) products continues to develop. During the second quarter, the Company shipped Fire Shield Power Surge Strips, a new product, to approximately 600 Wal-Mart Stores, Inc. In addition, Fire Shield licensed technology generated royalties of approximately $34,000 during the fiscal year so far. Also, as previously reported, the 2002 National Electrical Code now requires that room air conditioners be manufactured with cord fire prevention, which the Company's Fire Shield cord set provides. Underwriters Laboratories recently implemented this requirement into its product standard for room air conditioners to become effective in August 2004. - 5 - The Company expects to play a significant role in this newly developed marketplace. Although Fire Shield product sales were not material as a percentage of the Company's total revenues for the three and six-month periods ended September 30, 2002, the Company continues to believe that its patented Fire Shield technology represents its most significant opportunity for growth. The Company's gross profit margin on net sales was approximately 34% for the current quarter and approximately 33% for the six-month period ended September 30, 2002, compared to 23% and 25% for the same periods last year. The improvement in gross profit margins was the result of product mix plus productivity and quality improvements in manufacturing. Selling, general and administrative expenses were $756,205 for the current quarter and $1,541,985 for the six-month period ended September 30, 2002, compared to $828,553 and $1,653,517 for the same periods last year, a decrease of 9% and 7%, respectively. The decrease in expenses for the six-month period was due to lower certain employee benefits costs of $90,542, advertising costs of $5,253, outside sales commissions of $9,349 and other expenses of $6,388. Selling expenses were $432,740 for the current quarter and $892,667 for the six-month period ended September 30, 2002, compared to $486,706 and $963,959 for the same periods last year, a decrease of approximately 11% and 7%, respectively. General and administrative expenses were $323,465 for the current quarter and $649,318 for the six-month period ended September 30, 2002, compared to $341,847 and $689,558 for the same periods last year, a decrease of approximately 5% and 6%, respectively. Research, development and engineering expenses were $315,213 for the current quarter and $600,269 for the six-month period ended September 30, 2002, compared to $235,522 and $498,668 for the same periods last year, an increase of approximately 34% and 20%, respectively. The increase was related to the Company re-qualifying its portable GFCI products with Underwriters Laboratories ("UL"). As previously reported in the Company's Fiscal Year 2002 Form 10-K, UL announced on November 1, 2001 that it would toughen the test standard for portable GFCI devices as a result of a National Electrical Manufacturers Association ("NEMA") sponsored investigation of the long term performance and installations of GFCI Dual Outlet Receptacles across the United States. All of the Company's GFCI devices will need to be re-tested and re-certified by January 1, 2003, according to the present UL timetable. The re-certification will test for 1) expanded surge requirements, 2) new requirements for moisture and corrosion, and 3) new requirements for reverse line-load miss wiring. Of those products that represent significant revenues to the Company, re- certification is 100% complete, and of those products that represent minor revenues, UL is scheduled to review those products before the January 2003 deadline. Interest and sundry income, net of interest expense, for the current quarter was $927 and $3,926 for the six-month period ended September 30, 2002, compared to interest expense, net of interest and sundry income of ($22,436) and ($52,830) for the same periods last year, reflecting lower interest expense due to the Company reducing borrowings on its line of credit. - 6 - In accordance with SFAS 109, "Accounting for Income Taxes", the Company does not record deferred income taxes on the undistributed earnings of its foreign subsidiary, as it is management's intention to permanently reinvest these earnings outside of the U.S. Accordingly, as the Company's Honduras subsidiary was profitable, this has a favorable impact on the Company's overall effective income tax rate. Should circumstances change, and it becomes necessary to repatriate these undistributed earnings, the Company will record U.S. income taxes associated with these amounts in the period in which any such change in facts and circumstances occurs. Liquidity and Capital Resources As of September 30, 2002, the Company's cash and cash equivalents decreased to $1,072,437 from the March 31, 2002 total of $1,163,099. Cash provided by operating activities was $865,402, cash used in investing activities was $347,688 and cash used in financing activities was $608,376, giving a total decrease of $90,662. Cash provided by operating activities was primarily due to net earnings of $335,586, depreciation in the amount of $464,730, amortization of $215,646, a decrease in accounts receivable of $247,892 and deferred income taxes of $128,213, offset to some extent, by an increase in inventories and prepaid expenses of $170,251 and $380,061, respectively. The decrease in accounts receivable was the results of the Company collecting those overdue accounts that were mentioned in the Company's first quarter Form 10-Q. Inventories rose as the result of increased military business, and the increase in prepaid expenses was the result of up front payments by the Company for its one year Honduran facility lease and for its commercial property and casualty insurance. Cash used in investing activities was related to purchases of capital equipment only. The Company's capital expenditures were $347,688 for the six-month period ended September 30, 2002 compared to $129,612 in the prior year's period. Increased capital expenditures were due to the following: 1) the Company purchasing a 375 ton molding press to further vertically integrate its plastic parts requirements; 2) the Company's tooling for parts required on new programs; and 3) the Company's tooling for several new and existing products to be manufactured at the Company's contract manufacturer in China. Cash used in financing activities was due to the Company's repaying its line of credit by $500,000 and the payment of its cash dividend in the amount of $108,376. On November 12, 2002, the Company renewed its $3,000,000 revolving credit loan with its institutional lender, extending the maturity date to December 14, 2004. Although the Company did not utilize its line of credit in the second quarter, the Company has the option of borrowing at the lender's prime rate of interest minus 25 basis points or the 30-day London Interbank Offering Rate (L.I.B.O.R.) plus 175 basis points. The loan is collateralized with a perfected first security interest on all of its accounts receivable and inventories, and a blanket security interest on all of its assets. The Company continues to comply with its loan covenants. The Company has no off-balance sheet arrangements and no debt relationships other than noted above. - 7 - The Company's working capital decreased by $137,144 to $7,797,052 at September 30, 2002, compared to $7,934,196 at March 31, 2002. The decrease was due to the Company's reduction of its line of credit, as noted above. The Company believes cash flow from operations, the available bank line and current cash position will be sufficient to meet its working capital requirements for the immediate future. The Company's earnings before interest, income taxes, depreciation and amortization ("EBITDA") was $639,703 for the three-month period and $1,166,686 for the six-month period ended September 30, 2002, compared to $415,397 for the three-month period and $764,883 for the six-month period ended September 30, 2001. The chart below shows the reconciliation of EBITDA to net earnings: Three Months Ended Six Months Ended September 30 September 30 2002 2001 2002 2001 ---------- ---------- ---------- ---------- Net earnings $206,131 56,158 335,586 $ 58,248 Interest expense - 27,371 1,153 59,063 Income tax expense 88,720 18,720 149,571 19,416 Depreciation expense 226,834 229,149 464,730 449,521 Amortization expense 118,018 83,999 215,646 178,635 ---------- ---------- ---------- ---------- EBITDA $639,703 415,397 1,166,686 $764,883 The record date for the Company's second fiscal quarter dividend of $.01 per share was September 30, 2002, and the Company paid that dividend on October 25, 2002. New Accounting Standards In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") No. 143, "Accounting for Asset Retirement Obligations." This Statement addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. This Statement applies to all entities that have legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development or normal use of the asset. As used in this Statement, a legal obligation results from existing law, statute, ordinance, written or oral contract, or by legal construction of a contract under the doctrine of promissory estoppel. Enterprises are required to adopt SFAS No. 143 for fiscal years beginning after June 15, 2002. The Company does not believe the adoption of SFAS No. 143 will have a material effect on its financial statements. In June 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") No. 146, "Accounting for Costs Associated with Exit or Disposal Activities," which is effective for exit or disposal activities that are initiated after December 31, 2002. SFAS No. 146 requires that a liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred and can be measured at - 8 - fair value and nullifies EITF 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in Restructuring)." The Company does not believe the adoption of SFAS No. 146 will have a material effect on its financial statements. Item 3. Quantitative and Qualitative Disclosure Regarding Market Risk The Company has no derivative securities as of September 30, 2002. The Company's exposure to market risk for changes in interest rates would relate primarily to the Company's debt obligations due to its variable LIBOR Rate pricing; however, the Company has no debt obligations as of September 30, 2002. Forward Looking Statements Some of the statements in this report constitute forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. These statements related to future events, other future financial performance or business strategies, and may be identified by terminology such as "may," "will," "should," "expects," "scheduled," "plans," "intends", "anticipates," "believes," "estimates," "potential," or "continue" or the negative of such terms or other comparable terminology. These statements are only predictions, and actual events or results may differ materially. In evaluating these statements, you should specifically consider the factors described throughout this report. Such key factors include, but are not limited to, the acceptance of any new products, such as "Fire Shield", into the marketplace, the effective utilization of the Company's Honduran manufacturing facility, changes in manufacturing efficiencies and the impact of competitive products and pricing. The Company cannot be assured that future results, levels of activity, performance or goals will be achieved, and the Company disclaims any obligation to revise any forward-looking statements subsequent to events or circumstances or the occurrence of unanticipated events. Item 4. Controls and Procedures The Company's management, including the Chairman of the Board (serving as the principal executive officer) and Chief Financial Officer, have conducted an evaluation of the effectiveness of disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based on that evaluation, the Chairman of the Board and the Chief Financial Officer concluded that the disclosure controls and procedures are effective in ensuring that all material information required to be filed in this quarterly report has been made known to them in a timely fashion. There have been no significant changes in internal controls, or in other factors that could significantly affect internal controls, subsequent to the date the Chairman of the Board and Chief Financial Officer completed their evaluation. - 9 - Part II - Other Information Item 1. Legal Proceedings Not Applicable. Item 2. Changes in Securities Not Applicable. Item 3. Defaults Upon Senior Securities Not Applicable. Item 4. Submission of Matters to a Vote of Security Holders At the Company's annual meeting of shareholders held on August 22, 2002, the following matters were submitted for a vote by the shareholders: 1. To elect six members of the Board of Directors who will be elected to a one-year term of office. VOTES FOR VOTES WITHHELD --------- -------------- Robert S. Wiggins 4,809,025 229,884 Raymond H. Legatti 4,810,060 228,849 Raymond B. Wood 4,810,525 228,384 Gerry Chastelet 4,844,692 194,217 Edmund F. Murphy, Jr. 4,844,526 194,383 Martin L. Poad 4,845,692 193,217 2. To ratify the selection by the Company's Board of Directors of KPMG LLP as independent auditors of the Company for its fiscal year ending March 31, 2003. VOTES FOR VOTES AGAINST VOTES ABSTAINED --------- ------------- --------------- To ratify auditors 5,032,371 2,003 4,535 Item 5. Other Information Not Applicable. Item 6. Exhibits and Reports on Form 8-K The Company filed no reports on Form 8-K during the quarter covered by this Report. Exhibit 99.1 The Chief Executive Officer's certification required under Section 906 of the Sarbanes-Oxley Act of 2002. Exhibit 99.2 The Chief Financial Officer's certification required under Section 906 of the Sarbanes-Oxley Act of 2002. - 10 - ___________________________________________ 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. TECHNOLOGY RESEARCH CORPORATION (registrant) November 14, 2002 /s/ Scott J. Loucks ___________________________ __________________________________ Date Scott J. Loucks Chief Financial Officer, (principal financial, accounting and Duly Authorized Officer) - 11 - CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 CERTIFICATION - ------------- I, Robert S. Wiggins, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Technology Research 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 we 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 prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 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 (or persons performing the equivalent function): 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 a significant role in the registrant's internal controls; and - 12 - 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not 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. November 14, 2002 /s/ Robert S. Wiggins ___________________________ __________________________________ Date Robert S. Wiggins Chairman of the Board and Chief Executive Officer CERTIFICATION - ------------- I, Scott J. Loucks, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Technology Research 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 we 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 prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 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 (or persons performing the equivalent function): - 13 - 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 a 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 or not 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. November 14, 2002 /s/ Scott J. Loucks ___________________________ __________________________________ Date Scott J. Loucks Chief Financial Officer, (principal financial, accounting and Duly Authorized Officer) - 14 - EX-99.1 3 q10ex991.txt CERTIFICATION OF CHIEF EXECUTIVE OFFICER EXHIBIT 99.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002, 18 U.S.C. SECTION 1350 In connection with the Quarterly Report of Technology Research Corporation (the "Company") on Form 10-Q for the period ended September 30, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert S. Wiggins, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002, that: (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. November 14, 2002 /s/ Robert S. Wiggins ___________________________ __________________________________ Date Robert S. Wiggins Chairman of the Board and Chief Executive Officer - 15 - EX-99.2 4 q10ex992.txt CERTIFICATION OF CHIEF FINANCIAL OFFICER EXHIBIT 99.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002, 18 U.S.C. SECTION 1350 In connection with the Quarterly Report of Technology Research Corporation (the "Company") on Form 10-Q for the period ended September 30, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Scott J. Loucks, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002, that: (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. November 14, 2002 /s/ Scott J. Loucks ___________________________ __________________________________ Date Scott J. Loucks Vice President of Finance and Chief Financial Officer - 16 - -----END PRIVACY-ENHANCED MESSAGE-----