Item 7.01 Regulation FD Disclosure.
The Company issued a press release on May 5, 2020, announcing the resignation of Mr. Hermiz and the appointment of Mr. Abruzzo. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
On May 8, 2020, the Company issued a press release withdrawing the Company’s fiscal year 2020 guidance in light of the COVID-19 pandemic. A copy of the press release is furnished as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference.
The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing of the Company, whether made before or after the date hereof. The information in this report, including the exhibits
hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or of the Securities Act of 1933, as amended.
Supplemental Risk Factor
Due to the further impact of COVID-19 pandemic, the Company is supplementing the risk factors previously disclosed in its Form 10-Q with the following risk factor:
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The COVID-19 pandemic has disrupted, and will likely continue to disrupt, our business, which has and will likely continue to adversely affect our results of operations, financial position, and cash flow from operations.
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Pandemics or disease outbreaks, such COVID-19, have disrupted, and may continue to disrupt, automotive industry customer sales and production volumes. Vehicle production, including by our customers, has decreased significantly as of result of the COVID-19 pandemic, and resulted in the shutdown of manufacturing operations. As a result, we have experienced, and will likely continue to experience, reductions in orders from our customers globally. This reduction in orders may be further exacerbated by the global economic downturn resulting from the pandemic which could decrease consumer demand for vehicles or result in the financial distress of one or more of our customers or suppliers. As a result, our future sales volumes and revenue remain highly uncertain.
In addition, the Company and our suppliers have experienced facility closures, work stoppages, employee layoffs and furloughs, travel restrictions, implementation of precautionary health and safety measures and other restrictions, which could result in delays or the inability to produce and deliver products to our customers on a timely basis, even after operations fully resume. These delays could materially adversely affect our business, results of operations and financial condition. The financial impact of the COVID-19 pandemic could negatively impact our future compliance with financial covenants of our credit facility and other financing arrangements and result in a default and potentially an acceleration of indebtedness. This would negatively affect our liquidity and may adversely impact our operations and results of operations and may result in asset impairment.
The extent to which the COVID-19 pandemic adversely affects our financial performance will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and spread of the pandemic, its severity, the effectiveness of actions to contain the virus or treat its impact and how quickly and to what extent normal economic and operating conditions can resume. Even after the COVID-19 pandemic has subsided, we may continue to experience adverse impacts on our business and financial performance as a result of its global economic impact, including a recession that has occurred or may occur in the future. Our cash flow from operations, liquidity and financial position could be adversely affected by COVID-19 depending upon the length and severity of the disruption and impact upon on our customers, suppliers and our ability to effectively restart production.
In addition to the risks specifically described above, the COVID-19 pandemic has exacerbated and precipitated the other risks described in our Annual Report on Form 10-K for the year ended December 31, 2019 and Quarterly Report on Form 10-Q for the three months ended January 31, 2020, and may continue to do so, in ways that we are not currently able to predict, any of which could materially adversely affect our business, results of operations, financial position, and cash flow from operations.