10-Q 1 d10q.txt FORM 10-Q -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------- FORM 10-Q (Mark One) [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended December 29, 2001 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 No. 33-9875 ----------------- BOSTON ACOUSTICS, INC. (Exact name of registrant as specified in its charter) Massachusetts 04-2662473 (State or other jurisdiction (I.R.S. employer of incorporation or identification no.) organization) 300 Jubilee Drive Peabody, Massachusetts 01960 (Address of Principal Executive Offices) (Zip Code) (978) 538-5000 (Registrant's telephone number, including area code) 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 [ ] There were 4,595,595 shares of Common Stock issued and outstanding as of February 8, 2002 -------------------------------------------------------------------------------- 1 Boston Acoustics, Inc. Index -------
Page ------ Part I: Financial Information Item 1. Financial Statements Consolidated Balance Sheets (Unaudited) March 31, 2001 and December 29, 2001 4 Consolidated Statements of Income (Unaudited) Three months and Nine months ended December 30, 2000 and December 29, 2001 6 Consolidated Statements of Cash Flows (Unaudited) Nine months ended December 30, 2000 and December 29, 2001 7 Notes to Unaudited Consolidated Financial Statements 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Part II: Other Information Items 1 through 6 15 Signatures 16
2 PART I: FINANCIAL INFORMATION Item 1: Financial Statements 3 Boston Acoustics, Inc. and Subsidiaries Consolidated Balance Sheets (Unaudited) Assets --------
March 31, 2001 December 29, 2001 -------------- ----------------- Current Assets: Cash and cash equivalents $ 2,785,846 $ 6,009,484 Accounts receivable, net of reserves of approximately $385,000 and $482,000 at March 31 and December 29, 2001, respectively 11,426,411 12,853,224 Inventories 24,622,417 17,679,771 Deferred income taxes 2,044,000 2,044,000 Prepaid expenses and other current assets 747,844 543,979 ------------ --------------- Total current assets 41,626,518 39,130,458 ------------ --------------- Property and Equipment, at cost: Machinery and equipment 15,132,205 15,482,859 Building and improvements 8,816,515 8,834,928 Office equipment and furniture 4,907,967 5,054,242 Land 1,815,755 1,815,755 Motor vehicles 253,164 277,405 ------------ --------------- 30,925,606 31,465,189 Less-accumulated depreciation and amortization 15,533,147 17,984,555 ------------ --------------- 15,392,459 13,480,634 ------------ --------------- Other Assets, net 1,012,671 1,105,466 ------------ --------------- $58,031,648 $53,716,558 ============ ===============
The accompanying notes are an integral part of these consolidated financial statements. 4 Boston Acoustics, Inc. and Subsidiaries Consolidated Balance Sheets (Unaudited) Liabilities and Shareholders' Equity -------------------------------------
March 31, 2001 December 29, 2001 -------------- ----------------- Current Liabilities: Accounts payable $ 2,743,371 $ 9,507,252 Accrued payroll and payroll- related expenses 1,779,942 1,449,593 Dividends payable 418,990 390,626 Other accrued expenses 2,682,654 1,623,754 Accrued income taxes --- 308,883 Current maturity of line of credit 1,500,000 2,000,000 ----------- ------------ Total current liabilities 9,124,957 15,280,108 ----------- ------------ Line of credit, net of current maturity 10,000,000 1,500,000 ----------- ------------ Commitments and Contingencies Minority interest in joint venture 27,325 35,530 ----------- ----------- Shareholders' Equity: Common stock, $.01 par value Authorized - 8,000,000 shares Issued - 5,101,814 and 5,100,314 shares at March 31 and December 29, 2001, respectively 51,018 51,003 Additional paid-in capital 1,191,973 1,191,988 Subscriptions receivable (292,417) (272,917) Retained earnings 40,357,136 41,551,505 ----------- ---------- 41,307,710 42,521,579 Less-Treasury stock, 172,500 and 504,700 shares at cost at March 31 and December 29, 2001, respectively 2,428,344 5,620,659 ----------- ---------- Total shareholders' equity 38,879,366 36,900,920 ----------- ---------- $58,031,648 $53,716,558 =========== ===========
The accompanying notes are an integral part of these consolidated financial statements. 5 Boston Acoustics, Inc. and Subsidiaries Consolidated Statements of Income (Unaudited)
Three Months Ended Nine Months Ended ------------------ ------------------- December 30, December 29, December 30, December 29, 2000 2001 2000 2001 (13 weeks) (13 weeks) (40 weeks) (39 weeks) ------------- ------------- ------------- --------------- Net sales $33,682,164 $22,634,306 $91,089,338 $63,068,596 Cost of goods sold 24,152,821 14,751,005 64,584,992 43,276,198 ------------ ------------- ----------- ----------- Gross profit 9,529,343 7,883,301 26,504,346 19,792,398 ------------ ------------- ----------- ----------- Selling and marketing expenses 3,663,246 2,766,884 9,732,302 7,942,071 General and administrative expenses 1,468,257 1,308,806 3,927,309 3,637,693 Engineering and development expenses 1,233,136 1,293,566 4,013,480 3,850,823 ----------- ------------ ----------- ----------- Total operating expenses 6,364,639 5,369,256 17,673,091 15,430,587 ----------- ------------ ----------- ----------- Income from operations 3,164,704 2,514,045 8,831,255 4,361,811 Interest income 26,649 36,339 66,269 129,516 Interest expense (207,374) (35,722) (459,373) (281,489) Other expense (54,331) (92,851) (88,127) (142,118) ----------- ------------ ------------ ----------- Income before provision for income taxes 2,929,648 2,421,811 8,350,024 4,067,720 Provision for income taxes 1,099,000 906,000 3,132,000 1,645,000 ----------- ----------- ----------- ---------- Net income $ 1,830,648 $ 1,515,811 $ 5,218,024 $ 2,422,720 =========== =========== =========== =========== Net income per share: Basic $ .37 $ .32 $ 1 .06 $ .50 ========== =========== =========== =========== Diluted $ .36 $ .32 $ 1 .05 $ .50 ========== =========== =========== =========== Weighted average common shares outstanding (Note 3): Basic 4,918,471 4,674,124 4,911,568 4,834,463 Diluted 5,017,045 4,679,669 4,950,456 4,841,992 Dividends per share $ .085 $ .085 $ .255 $ .255 ========== ========== ========== ========== The accompanying notes are an integral part of these consolidated financial statements.
6 Boston Acoustics, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Unaudited)
Nine Months Ended ----------------- December 30, 2000 December 29, 2001 ----------------- ----------------- Cash flows from operating activities: Net income $ 5,218,024 $ 2,422,720 Adjustments to reconcile net income to net cash provided by (used in) operating activities - Depreciation and amortization 2,538,116 2,454,423 Changes in assets and liabilities - Accounts receivable (4,388,035) (1,426,813) Inventories (11,766,651) 6,942,646 Prepaid expenses and other current assets 484,762 203,865 Accounts payable 5,597,225 6,763,881 Accrued payroll and other accrued expenses 26,701 (1,389,249) Accrued income taxes --- 308,883 ----------- ------------- Net cash (used in) provided by operating activities (2,289,858) 16,280,356 ----------- ------------- Cash flows from investing activities: Purchases of property and equipment, net (2,631,529) (539,583) Increase in other assets (129,266) (87,605) ----------- ------------ Net cash used in investing activities (2,760,795) (627,188) ----------- ------------ Cash flows from financing activities: Dividends paid (1,251,603) (1,256,715) Purchase of treasury stock --- (3,192,315) Proceeds from line of credit 8,500,000 --- Repayments of line of credit (1,842,653) (8,000,000) Proceeds from exercise of stock options 63,700 --- Decrease in subscriptions receivable --- 19,500 ----------- ------------- Net cash provided by (used in) financing activities 5,469,444 (12,429,530) ----------- ------------- Net increase in cash and cash equivalents 418,791 3,223,638 Cash and cash equivalents, beginning of period 1,506,741 2,785,846 ----------- ------------- Cash and cash equivalents, end of period $ 1,925,532 $ 6,009,484 =========== ============= Supplemental Disclosure of Noncash Financing and Investing Activities: Dividends payable $ 418,701 $ 390,626 =========== ============= Minority interest in foreign subsidiary $ --- $ 8,205 =========== ============= Exercise of stock options through the issuance of subscriptions receivable $ 209,950 $ --- =========== ============= Supplemental Disclosure of Cash Flow Information: Cash paid for income taxes $ 2,684,500 $ 1,454,790 ============ ============= Cash paid for interest $ 447,321 $ 320,943 ============ =============
The accompanying notes are an integral part of these consolidated financial statements. 7 Boston Acoustics, Inc. and Subsidiaries Notes to Unaudited Consolidated Financial Statements (1) Basis of Presentation The unaudited consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission and include, in the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of interim period results. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The Company believes, however, that its disclosures are adequate to make the information presented not misleading. The results for the three and nine-month periods ended December 29, 2001 are not necessarily indicative of results to be expected for the full fiscal year. These financial statements should be read in conjunction with the Company's Annual Report included in its Form 10-K for fiscal year ended March 31, 2001. (2) Inventories Inventories are stated at the lower of cost (first-in, first-out) or market and consist of the following: March 31, 2001 December 29, 2001 -------------- ----------------- Raw materials and work-in-process $ 8,374,305 $ 6,975,754 Finished goods 16,248,112 10,704,017 ------------ ------------ $ 24,622,417 $ 17,679,771 ============ ============ Work-in-process and finished goods inventories consist of materials, labor and manufacturing overhead. (3) Net Income Per Common Share The Company follows the provisions of Statement of Financial Accounting Standards (SFAS) No. 128, Earnings per Share. SFAS No. 128 establishes standards for computing and presenting earnings per share (EPS) and applies to entities with publicly held common stock or potential common stock. Basic EPS is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution from common stock equivalents (stock options). For the three-month and nine-month periods ended December 29, 2001, there were 557,752 and 541,198 stock options, respectively, that have been excluded from the weighted average number of common and dilutive shares outstanding as their effect would be anti-dilutive. For the three-month and nine-month periods ended December 30, 2000, there were 81,334 and 219,897 stock options, respectively, that have been excluded from the weighted average number of common and dilutive shares outstanding as their effect would be anti-dilutive. 8 A reconciliation of the number of shares used in the calculation of basic and diluted net income per share, is as follows:
Three Months Ended Nine Months Ended ------------------ ------------------- December 30, December 29, December 30, December 29, 2000 2001 2000 2001 ------------ ------------ ------------ ------------ Basic weighted average common shares outstanding 4,918,471 4,674,124 4,911,568 4,834,463 Dilutive effect of assumed exercise of stock options 98,574 5,545 38,888 7,529 ----------- ----------- --------- --------- Weighted average common shares outstanding assuming dilution 5,017,045 4,679,669 4,950,456 4,841,992 ========== =========== ========= =========
(4) Segment Reporting The Company has two reportable segments: 1) core, and 2) original equipment manufacturer (OEM) and multimedia. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The Company does not allocate operating expenses between its two reportable segments. Accordingly, the Company's measure of profit for each reportable segment is based on gross profit. Three Months Ended December 29, 2001
OEM and Fiscal 2002 Core Multimedia Total ----------- ---- ---------- ----- Net Sales $16,227,399 $ 6,406,907 $22,634,306 =========== =========== =========== Gross profit $ 6,789,086 $ 1,094,215 $ 7,883,301 ============ =========== ===========
Three Months Ended December 30, 2000
OEM and Fiscal 2001 Core Multimedia Total ----------- ---- ---------- ----- Net Sales $ 16,649,964 $17,032,200 $33,682,164 ============ =========== =========== Gross profit $ 5,462,352 $ 4,066,991 $ 9,529,343 ============ =========== ===========
9 Nine Months Ended December 29, 2001
OEM and Fiscal 2002 Core Multimedia Total ----------- ---- ---------- ----- Net Sales $42,453,106 $20,615,490 $63,068,596 =========== =========== =========== Gross profit $16,600,227 $ 3,192,171 $19,792,398 =========== =========== ===========
Nine Months Ended December 30, 2000
OEM and Fiscal 2001 Core Multimedia Total ----------- ---- ---------- ----- Net Sales $45,607,684 $45,481,654 $91,089,338 =========== =========== =========== Gross profit $15,779,446 $10,724,900 $26,504,346 =========== =========== ===========
(5) Significant Customers and Concentration of Credit Risk For the three-month periods ended December 29, 2001 and December 30, 2000, two customers represented approximately 44% and 60% of the Company's net sales, respectively. The same two customers accounted for approximately 46% and 57% of the net sales for the nine months ended December 29, 2001 and December 30, 2000 respectively. Three customers represented 21%, 13%, and 12%, respectively, of net accounts receivable at December 29, 2001. (6) International Operations The Company maintains sales concentrations in Europe, Asia, and Canada in addition to distributing product through three foreign subsidiaries. Export sales accounted for approximately 15% and 20% of net sales for the three-month periods ended December 29, 2001 and December 30, 2000, respectively. For the nine-month periods ended December 29, 2001 and December 30, 2000, export sales accounted for approximately 17% and 18%, respectively. (7) Recent Accounting Pronouncements In June 2001, the FASB issued SFAS No. 141, Business Combinations. SFAS 141 requires all business combinations initiated after June 30, 2001 to be accounted for using the purchase method. The Company does not expect the adoption of this statement to have a material impact on its operations. In June 2001, the FASB issued SFAS No. 142, Goodwill and Other Intangible Assets. With the adoption of SFAS No. 142, goodwill is no longer subject to amortization over its estimated useful life, but instead is subject to at least an annual assessment for impairment by applying a fair-value-based test. The Company does not expect the adoption of this statement to have a material impact on its operations. In June 2001, the FASB issued 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. It applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and (or) the normal operation of a long-lived asset, except for certain obligations of lessees. This statement amends FASB Statement No. 19 and is effective for financial statements issued for fiscal years beginning after June 15, 2002. The Company does not expect the adoption of this statement to have a significant impact on its financial position or results of operations. 10 In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. This statement supercedes FASB Statement No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, and the accounting and reporting provisions of Accounting Principles Board Opinion No. 30, Reporting the Results of Operations - Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions. Under this statement, it is required that one accounting model be used for long-lived assets to be disposed of by sale, whether previously held and used or newly acquired, and it broadens the presentation of discontinued operations to include more disposal transactions. The provisions of this statement are effective for financial statements issued for fiscal years beginning after December 15, 2001, and interim periods within those fiscal years, with early adoption permitted. The Company does not expect the adoption of this statement to have a significant impact on its financial position or results of operations. (8) Reclassifications Certain amounts in the prior-period consolidated financial statements have been reclassified to conform to the current period's presentation. 11 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations The following table sets forth the results of operations for the three-month and nine-month periods ended December 30, 2000 and December 29, 2001 expressed as percentages of net sales.
Three Months Ended Nine Months Ended ------------------ ----------------- December 30, December 29, December 30, December 29, 2000 2001 2000 2001 (13 weeks) (13 weeks) (40 weeks) (39 weeks) ------------ ------------ ------------ ------------- Net sales 100.0 % 100.0 % 100.0 % 100.0 % Cost of goods sold 71.7 65.2 70.9 68.6 ----- ----- ----- ----- Gross profit 28.3 34.8 29.1 31.4 ----- ----- ----- ----- Selling and marketing expenses 10.9 12.2 10.7 12.6 General and administrative expenses 4.3 5.8 4.3 5.8 Engineering and development expenses 3.7 5.7 4.4 6.1 ----- ----- ----- ----- 18.9 23.7 19.4 24.5 ----- ----- ----- ----- Income from operations 9.4 11.1 9.7 6.9 Interest income (expense), net (0.5) 0.0 (0.4) (0.3) Other Expense (0.2) (0.4) (0.1) (0.2) ------ ----- ----- ----- Income before provision for income taxes 8.7 10.7 9.2 6.4 Provision for income taxes 3.3 4.0 3.5 2.6 ----- ----- ----- ----- Net income 5.4 % 6.7 % 5.7 % 3.8 % ===== ===== ===== =====
Net sales for the third quarter decreased 33%, from approximately $33,682,000 last year to approximately $22,634,000 for the current fiscal period. For the nine-month period ended December 29, 2001, net sales decreased 31% from approximately $91,089,000 during Fiscal 2001 to approximately $63,069,000. The overall sales decrease for the three-month period 12 ended December 29, 2001 was the result of a 62% sales decrease in the OEM and multimedia segment reflecting the continuing softness in the personal computer business compared to the same period a year ago. The Company's Core segment sales were down 2.5% compared to the same period a year ago; however, the gross margin and profit dollars for the Core segment both increased. The nine-month period ended December 29, 2001 includes 39 weeks of sales and earnings compared to 40 weeks for the corresponding nine-month period a year ago. During the third quarter of Fiscal 2002, the Company's Core segment sales included continued strong sales of the Company's VR-M line of floor standing and bookshelf speaker systems and the introduction of the new Unity DVD Home Theater System. The Unity is a co-branded system featuring a high-performance receiver/DVD player manufactured by Kenwood Corporation and six-matched Boston Acoustics surround loudspeakers, including a 100-watt, 8-inch powered subwoofer. The Unity has a MSRP of $999. The Company's gross margin percentage for the three-month and nine-month periods ended December 29, 2001 increased as compared to the corresponding periods in the prior fiscal year. The increases for both the three-month and nine-month periods were primarily the result of the continued improved manufacturing efficiencies, reduced scrap and rework costs, the elimination of contract labor and off-site warehousing costs as compared to the same periods a year ago. Additionally, the OEM/Multimedia segment of sales, which has lower gross margins, represented a smaller portion of total net sales during the three-month and nine-month periods ended December 29, 2001 as compared to the same periods a year ago, and as a result, the overall gross margin increased. Total operating expenses, despite increasing as a percentage of net sales due to the lower overall sales level, decreased in absolute dollars during both the three-month and nine-month periods ended December 29, 2001. Selling and marketing expenses have decreased in absolute dollars primarily due to decreased salaries and related expenses, lower travel expenditures and reduced advertising costs relating to both the core and multimedia retail segments. The decrease in absolute dollars of general and administrative expenses for the three-month and nine-month periods ended December 29, 2001 is attributed to a reduction of outside consulting services and insurance costs. Engineering and development expenses for the three-month and nine-month periods ended December 29, 2001 have decreased in absolute dollars due primarily to lower payroll-related costs, travel, and consulting fees as compared to the same periods a year ago. Net interest expense has decreased both in absolute dollars and as a percentage of net sales during both the three-month and nine-month periods ended December 29, 2001 as compared to the corresponding periods a year ago. The decrease is due to reduced line of credit borrowings and related borrowing rates. The Company's effective tax rate for the three-month period ended December 29, 2001 decreased slightly to 37.4% from 37.5% for the corresponding period a year ago. The decrease can be attributed to lower state income taxes offset by international sales representing a lower percentage of total sales for the current period. The Company's effective income tax rate increased to 40.4% for the nine-month period ended December 29, 2001 as compared to 37.5% for the nine-month period ended December 30, 2000, due primarily to the Company's inability to benefit from losses sustained by the Company's subsidiaries outside the U.S. coupled with a reduction in international sales as a percentage of total sales. Net income for the third quarter decreased from approximately $1,831,000 in Fiscal 2001 to approximately $1,516,000 in Fiscal 2002 while diluted earnings per share decreased from $.36 to $.32 per share. Net income for the nine-month period ended December 29, 2001 decreased from approximately $5,218,000 in Fiscal 2001 to approximately $2,423,000, while diluted earnings per share decreased from $1.05 to $.50 per share. The decrease in net income for the three and nine-month periods ended December 29, 2001 is primarily the result of the overall decrease in net sales. Liquidity and Capital Resources As of December 29, 2001, the Company's working capital was approximately $23,850,000, a decrease of approximately $8,651,000 since the end of Fiscal 2001. The decrease in working capital since March 31, 2001, was primarily due to the repayments made on the Company's line of credit borrowings, as well as 13 reductions in inventory balances and increases in accounts payable which were partially offset by an increase in cash and cash equivalents. The Company's cash and cash equivalents were approximately $6,009,000 at December 29, 2001, an increase of approximately $3,224,000 from March 31, 2001 primarily due to the reduction in inventory levels and increased accounts payable. The reduction in inventory levels is primarily due to a decrease in OEM/Multimedia business segment purchases during Fiscal 2002. Current liabilities increased by approximately $6,155,000 primarily as a result of accounts payable balances not due until after the quarterly period had ended. Long term debt decreased by $8,500,000 as a result of repayments under the Company's line of credit and reclassifying a portion of the debt to current liabilities. The Company has two lines of credit with two banking institutions totaling $26,500,000. At December 29, 2001, the Company had borrowings totaling $3,500,000 under its $25,000,000 revolving credit agreement, and $0 outstanding under its $1.5 million revolving credit agreement. The Company believes that its current resources are adequate to meet its requirements for working capital and capital expenditures for the foreseeable future. Significant Customers The Company's financial results for the three-month and nine-month periods ended December 29, 2001 include significant OEM sales of multimedia speaker systems to Gateway, Inc. ("Gateway"). The terms of these sales are governed by a Master Supply Agreement between Gateway and the Company which defines such issues as ordering and invoicing procedures, shipping charges, warranties, repair service support, product safety requirements, etc. This Master Supply Agreement with Gateway does not contain minimum or scheduled purchase requirements; therefore, purchase orders by Gateway may fluctuate significantly from quarter to quarter. Based on information currently available from our OEM customer, the Company anticipates that its OEM sales will be substantially reduced for the fiscal year ending March 30, 2002 as compared to Fiscal 2001. The loss of Gateway as a customer or any significant portion of orders from Gateway could have a material adverse affect on the Company's business, results of operations and financial condition. In addition, the Company could also be materially adversely affected by any substantial work stoppage or interruption of production at Gateway or if Gateway were to reduce or cease conducting operations. Cautionary Statements The Private Securities Litigation Reform Act of 1995 contains certain safe harbors regarding forward-looking statements. From time to time, information provided by the Company or statements made by its directors, officers, or employees may contain "forward-looking" information which involve risk and uncertainties. Any statements in this report that are not statements of historical fact are forward-looking statements (including, but not limited to, statements concerning the characteristics and growth of the Company's market and customers, the Company's objectives and plans for future operations, and the Company's expected liquidity and capital resources). Such forward-looking statements are based on a number of assumptions and involve a number of risks and uncertainties, and accordingly, actual results could differ materially. Factors that may cause such differences include, but are not limited to: the continued and future acceptance of the Company's products, the rate of growth in the audio industry; the presence of competitors with greater technical, marketing and financial resources; the Company's ability to promptly and effectively respond to technological change to meet evolving consumer demands; capacity and supply constraints or difficulties; and the Company's ability to successfully integrate new operations. The words "believe," "expect," "anticipate," "intend" and "plan" and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. For a further discussion of these and other significant factors to consider in connection with forward-looking statements concerning the Company, reference is made to Exhibit 99 of the Company's Form 8-K filed on July 18, 1996. 14 PART II: OTHER INFORMATION Item 1. Legal Proceedings ----------------- None Item 2. Changes in Securities --------------------- None Item 3. Defaults Upon Senior Securities ------------------------------- 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 -------------------------------- No reports on Form 8-K were filed during the quarter ended December 29, 2001. 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. Boston Acoustics, Inc. Registrant Date: February 8, 2002 By: /s/Andrew G. Kotsatos ---------------------------------- Andrew G. Kotsatos Director, Chief Executive Officer and Treasurer Date: February 8, 2002 By: /s/Moses A. Gabbay ---------------------------------- Moses A. Gabbay Director, President and Chief Operating Officer Date: February 8, 2002 By: /s/Debra A. Ricker-Rosato ---------------------------------- Debra A. Ricker-Rosato Vice President and Chief Accounting Officer 16