(

)

Recent Accounting Pronouncements

2014,

the

Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

2014

- Revenue from Contracts with Customers (Topic

606

), and has subsequently issued ASUs

2015

– Revenue from Contracts with Customers (Topic

606

): Deferral of the Effective Date,

2016

- Revenue from Contracts with Customers (Topic

606

): Principal versus Agent Considerations (Reporting Revenue Gross Versus Net),

2016

- Revenue from Contracts with Customers (Topic

606

): Identifying Performance Obligations and Licensing,

2016

- Revenue from Contracts with Customers (Topic

606

): Narrow-Scope Improvements and Practical Expedients, and

2016

- Revenue from Contracts with Customers (Topic

606

): Technical Corrections and Improvements to Topic

606

(collectively, the Revenue Recognition ASUs).

The Revenue Recognition ASUs outline a single comprehensive model for entities to use in accounting for revenue arising from contracts with

customers and supersede most current revenue recognition guidance, including industry-specific guidance. The guidance is based on the principle that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. This guidance is effective for the Company beginning on

January 1, 2018

and entities have the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. We are evaluating whether we will adopt this guidance using the full retrospective or modified retrospective approach, however we currently anticipate using the modified retrospective method.

We are concluding the assessment phase of implementing this guidance. We have evaluated each of the

five

steps in the new revenue recognition model, which are as follows:

) Identify the contract with the customer;

) Identify the performance obligations in the contract;

) Determine the transaction price;

) Allocate the transaction price to the performance obligations; and

) Recognize revenue when (or as) performance obligations are satisfied. Our preliminary conclusion is that the determination of what constitutes a contract with our customers (step

), our performance obligations under the contract (step

), and

the determination and allocation of the transaction price (steps

and

) under the new revenue recognition model will

not

result in significant changes in comparison to the current revenue recognition guidance.

With regard to recognizing revenue when (or as) a performance obligation is satisfied (step

), we are thoroughly reviewing the language in our contracts with each customer to determine whether the customer obtains control of the goods at a point in time or over time. Under current revenue recognition guidance, we recognize revenue when products are shipped to our customers and title transfers under standard commercial terms or when realizable in accordance with our commercial agreements. Topic

606

provides certain criteria that, if met, require companies to recognize revenue as the product is produced (over time) instead of at a point of time (i.e. upon shipment). We are evaluating our contracts in the context of the criteria for recognizing revenue over time. If we conclude that we meet the criteria for recognizing revenue over time, our timing of revenue recognition

could be accelerated.

February 2016,

the FASB issued ASU

No.

2016

02,

Leases (Topic

842

). The new standard was issued to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This standard affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this update supersedes FASB A

ccounting Standards Codification (“ASC”)

840,

Leases. The amendments in this ASU are effective for fiscal years beginning after

December 15, 2018,

including interim periods within those fiscal years. The Company is currently assessing the impact of adopting this ASU on its consolidated financial statements and related disclosures. We believe the adoption of the standard will likely have a material impact to our Consolidated Balance Sheets for the recognition of certain operating leases as right-of-use assets and lease liabilities. We are in the early process of analyzing our lease portfolio and evaluating systems to comply with the standard’s retrospective adoption requirements.

August 2016,

the FASB issued ASU

No.

2016

15,

Classification of Certain Cash Receipts and Cash Payments (ASU

2016

). This ASU provides guidance to clarify how certain cash receipts and payments should be presented in the statement of cash flows. The guidance is effective for annual periods beginning after

December 15, 2017,

and interim periods within those annual periods. Early adoption is permitted in any annual or interim period. The updated guidance requires a modified retrospective adoption. The Company is evaluating the impact of adoption of ASU

2016

on the Company's financial position, results of operations and cash flow.

October 2016,

the FASB issued guidance that simplifies the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. Current

U.S. GAAP prohibits the recognition in earnings of current and deferred income taxes for an intra-entity transfer until the asset is sold to an outside party or recovered through use. This amendment simplifies the accounting by requiring entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The new guidance, which could impact effective tax rates, becomes effective

January 1, 2018

and requires modified retrospective application. Early adoption is permitted as of the beginning of an annual reporting period for which interim or annual financial statements have

not

yet been issued. The Company is evaluating the impact of adoption of this guidance on the Company's financial position, results of operations and cash flow.

November 2016,

the FASB released guidance that addresses the diversity in practice in the classification and presentation of changes in restricted cash on the statement of cash flows. Amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance becomes effective

January 1, 2018

and must be applied on a retrospective basis. This guidance will result in a change in presentation of our consolidated statement of cash flows.

March 2017,

the FASB issued A

No.

2017

07,

Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (ASU

2017

). The update requires employers to present the service cost component of the net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered during the period. The other components of net benefit cost, including interest cost, expected return on plan assets, amortization of prior service cost/credit and actuarial gain/loss, and settlement and curtailment effects, are to be presented outside of any subtotal of operating income. Employers will have to disclose the line(s) used to present the other components of net periodic benefit cost, if the components are

not

presented separately in the income statement. ASU

2017

is effective for fiscal years and interim periods beginning after

December

15,

2017,

and early adoption is permitted. The Company does

not

expect the adoption of ASU

2017

to have a material impact on its consolidated financial statements.

May 2017,

the FASB issued ASU

No.

2017

09,

which is an update to Topic

718,

Compensation - Stock Compensation. The update provides guidance on determining which changes to the terms and conditions of share-based payment awards, including stock options, require an entity to apply modification accounting under Topic

718.

The new standard is effective for fiscal years beginning after

December 15, 2017,

including interim periods within those fiscal years. Early adoption is permitted. The Company does

not

expect the adoption of ASU

2017

to have a material impact on its consolidated financial statements.