UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SD
Specialized Disclosure Report
ALLIED
HEALTHCARE PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 0-19266 | 25-1370721 |
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| 1720 Sublette Avenue, St. Louis, Missouri (Address of principal executive offices) |
63110 (Zip Code) |
Daniel C. Dunn 314-771-2400
(Name and telephone number, including area code, of the person to contact in connection with this report.)
Check the appropriate box to indicate the rule pursuant to which this form is being filed, and provide the period to which the information in this form applies:
| x | Rule 13p-1 under the Securities Exchange Act (17 CFR 240.13p-1) for the reporting period from January 1 to December 31, 2017. |
Section 1 – Conflict Minerals Disclosure
Item 1.01 Conflict Minerals Disclosure and Report
This Form SD is filed by Allied Healthcare Products, Inc., a Delaware corporation (“Allied”, the “Company”, “we”, or “us”) for the year ended December 31, 2017 to comply with Rule 13p-1 under the Securities Exchange Act of 1934 (“Rule”). Certain terms in this Form SD are defined in the Rule and our Conflict Minerals Report, filed herewith as Exhibit 1.01, and the reader is referred to those sources for such definitions.
RCOI for 2017 calendar Year
We have determined that conflict minerals exist in at least one component of at least one product that we manufacture or contract to manufacture in each of our core businesses. These components contain conflict minerals that are necessary to the functionality or production of these products. Therefore, in accordance with the Rule and Form SD, we initiated a reasonable country of origin inquiry (“RCOI”) with our direct suppliers to determine whether any conflict minerals originated in the Democratic Republic of the Congo or an adjoining country (collectively, the “Covered Countries”) and/or may have been from recycled or scrap sources.
Our RCOI process employed a number of measures to determine whether the necessary conflict minerals in our products originated in the Covered Countries and/or may have been from recycled or scrap sources, including the following:
| - | Consultation with the Company’s engineering staff to help determine which components do not contain conflict minerals; |
| - | Creation of a comprehensive supplier list; |
| - | Communication and engagement with our suppliers; |
| - | Distribution to our suppliers of a questionnaire based the Electronic Industry Citizenship Coalition (“EICC”) and The Global e-Sustainability Initiative (“GeSI”) Conflict Minerals Reporting Template (“EICC/GeSI Form”); |
| - | Collection of responses to our questionnaire from our suppliers, some of which are provided on the EICC/GeSI Form and some of which are provided on our form; |
| - | Review of collected responses to identify supplier risk level, as described further in our Conflict Minerals Report, determine country of origin and/or sourcing from recycled or scrap sources and determine if due diligence is required; and |
| - | Follow-up communication with suppliers to update forms if their responses did not meet our review requirements and to understand and mitigate risks related to conflict minerals in their supply chains. |
There is significant overlap between our RCOI efforts and our due diligence measures performed. Our due diligence measures are discussed further in the Conflict Minerals Report filed as Exhibit 1.01 hereto.
From over 26,000 parts reviewed by the Company, surveys returned to the Company indicated that 136 parts use or contain conflict minerals originating from outside Covered Countries and 200 parts use or contain conflict minerals originating within Covered Countries, but the conflict minerals originating in Covered Countries were smelted at smelters which are compliant with Conflict Free Smelter Program protocols by the Conflict Free Sourcing Initiative (“CFSI”). Surveys received from vendors indicated that one part used by the Company uses or contains conflict minerals, the source of which is unknown. The vendors of 13 parts either did not respond or could not determine whether such parts use or contain conflict minerals. No surveys indicated that any conflict minerals necessary for the functionality of our products were not conflict free under the CFSI protocols.
Conflict Minerals Disclosure
The Conflict Minerals Report for the calendar year ended December 31, 2017 filed herewith as Exhibit 1.01 is available at http://www.alliedhpi.com.
Item 1.02 Exhibit
The Conflict Minerals Report required by Item 1.01 is filed as Exhibit 1.01 to this Form SD.
Section 2 – Exhibits
Item 2.01 Exhibits
Exhibit 1.01 – Conflict Minerals Report as required by Items 1.01 and 1.02 of this Form.
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 duly authorized undersigned.
| ALLIED HEALTHCARE PRODUCTS, INC. | |
| By: | |
| Date: May 30, 2018 | /s/ Daniel C. Dunn |
| Daniel C. Dunn | |
| Chief Financial Officer |
Exhibit 1.01
Conflict Minerals Report
This Conflict Minerals Report (“Report”) of Allied Healthcare Products, Inc., a Delaware corporation (“Allied”, the “Company”, “we”, or “us”) for the year ended December 31, 2017 is presented to comply with Rule 13p-1 under the Securities Exchange Act of 1934 (“Rule”). Certain terms in this Report are defined in the Rule and our Specialized Disclosure Report on Form SD and the reader is referred to those sources for such definitions.
Product Overview
We manufacture a variety of respiratory products used in the health care industry in a wide range of hospital and alternate site settings, including sub-acute care facilities, home health care and emergency medical care. The Company’s product lines include respiratory care products, medical gas equipment and emergency medical products.
Our product lines include:
Respiratory Care Products
| · | respiratory care/anesthesia products |
| · | home respiratory care products |
Medical Gas Equipment
| · | medical gas system construction products |
| · | medical gas system regulation devices |
| · | disposable oxygen and specialty gas cylinders |
| · | portable suction equipment |
Emergency Medical Products
| · | respiratory/resuscitation products |
| · | trauma and patient handling products |
The Company internally reviews the composition of all components supplied to the Company and, based on its knowledge of these components, determines which components do not contain conflict minerals.
Report Overview
The Company has concluded that during 2017 (i) it manufactured products as to which “conflict minerals” (as defined in Section 1, Item 1.01 (d)(3) of Form SD) are necessary to the functionality or production of such products and (ii) based on a reasonable country of origin inquiry (“RCOI”) the Company has not been able to determine the origin of its necessary conflict minerals. Pursuant to SEC staff guidance, no company, including Allied, is required to describe its products as “DRC conflict free,” having “not been found to be ‘DRC conflict free,’” or “DRC conflict undeterminable.”
Due Diligence Process and Results
The Company performed due diligence on the source and chain of custody of the conflict minerals that are necessary to the functionality or production of its products. The due diligence measures conformed to the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (Second Edition), an internationally recognized due diligence framework.
The Company has employed a combination of measures to exercise such due diligence. For example, the Company adopted a formal Conflict Minerals Policy which can be found on the Company’s website at www.alliedhpi.com. In addition, the Vice-President of Operations and Quality Department has implemented and maintains the supply chain due diligence process. This Department is competent to oversee the supply chain due diligence process because of their previous experience with the maintenance of the quality system for FDA compliance and its familiarity with the Company’s production processes. The Vice-President of Operations and Quality Department reports to our Chief Executive Officer.
The Company’s primary means of due diligence was through a supply-chain survey with direct suppliers using a questionnaire based on the EICC/GeSI Conflict Minerals Reporting Template. The Company submitted such a survey to all of its vendors who supply the Company with components which, based on the Company’s internal review, likely contain conflict minerals. We have received responses from each of the vendors to whom we submitted such surveys.
From over 26,000 parts reviewed by the Company, surveys returned to the Company indicated that 136 parts use or contain conflict minerals originating from outside Covered Countries and 200 parts use or contain conflict minerals originating within Covered Countries, but the conflict minerals originating in Covered Countries were smelted at smelters which are compliant with Conflict Free Smelter Program protocols by the Conflict Free Sourcing Initiative (“CFSI”). Surveys received from vendors indicated that one part used by the Company uses or contains conflict minerals, the source of which is unknown. The vendors of 13 parts either did not respond or could not determine whether such parts use or contain conflict minerals. No surveys indicated that any conflict minerals necessary for the functionality of our products were not conflict free under CFSI protocols.
The Company’s efforts to determine the mine or location of origin of the necessary conflict minerals included submitting the survey described above and additional follow-up contacts with several suppliers.
As a downstream purchaser of inputs, the Company’s due diligence measures can provide only reasonable, not absolute, assurance regarding the source and chain of custody of the necessary conflict minerals. We generally do not have direct relationships with miners, smelters or refiners with respect to conflict minerals and do not perform or direct audits of these entities within our supply chain. The Company’s due diligence processes are based on the necessity of seeking data from our direct suppliers and those suppliers seeking similar information within their supply chains to identify the original sources of the necessary conflict minerals.
Risk Management
The Company has implemented several procedures to manage the risk that our necessary conflict minerals might originate from Covered Countries. For example, the Company’s standard vendor agreement requires vendors to notify the Company if any products supplied to the Company contain conflict minerals and to notify the Company of the country of origin of any such conflict minerals. As smelters are identified, the Company will engage those smelters where possible (or rely on independent industry certifications) to determine if they CFSI compliant. The Company has also added standards relating to the sourcing of conflict minerals to its vendor qualification process and procedures. The status of those vendor qualifications are a consideration in purchasing decisions.