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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">15.</td> <td style="TEXT-ALIGN: justify">NEW ACCOUNTING PRONOUNCEMENTS</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> In June 2011, the FASB amended Accounting Standards Update (ASU 2011-05), <em>Comprehensive Income, Presentation of Comprehensive Income</em>, which requires companies to present the components of net income and other comprehensive income either as one continuous statement or as two consecutive statements. It eliminates the option to present components of other comprehensive income as part of the statement of changes in shareholders' equity. We have elected to adopt the presentation of the components of net income and other comprehensive income as two consecutive statements. ASU 2011-05 changes the presentation, but not the accounting requirements, of other comprehensive income and therefore had no effect on our financial position, results of operations or cash flows.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> In February 2013, the FASB issued ASU 2013-02, <em>Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income</em>, which requires companies to provide information about amounts reclassified out of other comprehensive income by component. We are required to present, either on the face of the financial statements or in the notes, the amounts reclassified from other comprehensive income to the respective line items in the Consolidated Statements of Operations. This amendment is effective for interim and annual periods beginning after December 15, 2012. The adoption of this guidance did not have a material impact on our consolidated financial statements.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="WIDTH: 0in"> </td> <td style="TEXT-ALIGN: left; WIDTH: 0.5in">7.</td> <td style="TEXT-ALIGN: justify">ACQUISITION OF BUSINESS</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> On July 1, 2013, we acquired the machine tool component business of LCM S.r.l, an Italian designer and manufacturer of highly innovative high-end electro-mechanical components and accessories for machine tools. We are operating this business as LCM Precision Technology S.r.l. (LCM). The purchase price has been preliminarily allocated to the assets acquired and the liabilities assumed based on their fair values. The purchase price for the acquired assets and the assumed liabilities was $5.0 million. The allocation of the opening balance sheet as of July 1, 2013 is as follows (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 80%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; WIDTH: 85%"> Current assets</td> <td style="COLOR: black; WIDTH: 1%"> </td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="COLOR: black; TEXT-ALIGN: right; WIDTH: 12%">6,659</td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Property plant and equipment</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">933</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Intangibles</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">1,437</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Goodwill</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 2,477</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> Total assets</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left">$</td> <td style="COLOR: black; TEXT-ALIGN: right">11,506</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Current liabilities</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left">$</td> <td style="COLOR: black; TEXT-ALIGN: right">4,793</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px">Short term debt</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">4,643</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Non-current liabilities</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 1,690</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> Total Liabilities</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 11,126</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> </td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px">Cash expended, net of cash acquired</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">380</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Indebtedness assumed</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 4,643</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> Total purchase price</td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: right"> 5,023</td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Intangible assets of $1.4 million were recorded as a result of the purchase of the LCM assets. The fair value of the intangible assets was based upon a discounted cash flow method that involves inputs that are not observable in the market (Level 3). Intangible assets are amortized primarily using a straight-line methodology. The intangible assets preliminarily consisted of the following (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 95%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: justify" colspan="2" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="COLOR: black" nowrap="nowrap"> </td> <td style="COLOR: black; TEXT-ALIGN: justify" nowrap="nowrap"> Remaining<br /> Economic</td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="TEXT-ALIGN: justify" colspan="2" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: justify" nowrap="nowrap">Useful Life</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 0px; WIDTH: 69%"> Trademark/name</td> <td style="COLOR: black; WIDTH: 1%"> </td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="COLOR: black; TEXT-ALIGN: right; WIDTH: 12%">274</td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="COLOR: black; WIDTH: 1%"> </td> <td style="COLOR: black; TEXT-ALIGN: center; PADDING-LEFT: 5.4pt; WIDTH: 15%"> 13 years</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 0px"> Technology and manufacturing know how</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">1,110</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: center; PADDING-LEFT: 5.4pt"> 13 years</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 0px"> Customer relationships</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 52</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: center; PADDING-LEFT: 5.4pt"> 16 years</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: right"> 1,437</td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 15; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The excess purchase price over the fair value of the assets acquired and the liabilities assumed was recorded as goodwill and was preliminarily recorded as $2.5 million. Goodwill recognized in the acquisition relates primarily to advancing our machine tool technology and expanding our current product offering. We expect the amount recorded as goodwill to be fully deductible for tax purposes.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The results of operations of LCM have been included in the consolidated financial statements from the date of acquisition. We incurred various costs related to the purchase of certain assets and assumed liabilities of LCM business including professional fees for due diligence, legal and accounting services. These costs totaled approximately $464,000 and $675,000 for the three and nine month period ending July 31, 2013, and have been recorded as operating expenses in the Condensed Consolidated Statements of Operations.</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">10.</td> <td style="TEXT-ALIGN: justify">DEBT AGREEMENTS</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We have a credit agreement with a financial institution, which provides for a $12.5 million unsecured credit facility, which provides for revolving credit and up to $3.0 million for letters of credit. The scheduled maturity date of the credit agreement is December 7, 2014.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 16; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Borrowings under the credit agreement bear interest at a LIBOR-based rate or a floating rate of 1% above the prevailing prime rate. The floating rate will not be less than the greatest of (a) a one month LIBOR-based rate plus 1.00% per annum, (b) the federal funds effective rate plus 0.50% per annum, and (c) the prevailing prime rate. The rate we must pay for that portion of the credit agreement which is not utilized is 0.05% per annum.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The credit agreement permits us to make annual investments in subsidiaries of up to $5.0 million and contains financial covenants that we maintain a minimum working capital requirement of $90.0 million and a minimum tangible net worth requirement of $120.0 million. The credit agreement permits us to pay cash dividends in an amount not to exceed $1.0 million per calendar year so long as we are not in default before and after giving effect to such dividends. The credit agreement also contains other customary covenants.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We also have an uncommitted credit facility in Taiwan in the amount of 100.0 million New Taiwan Dollars (approximately $3.3 million), a £1.0 million revolving credit facility in the United Kingdom and a €1.5 million revolving credit facility in Germany. The Taiwan and United Kingdom facilities mature on December 7, 2014. The revolving credit facility in Germany does not have an expiration date.</p> <p style="TEXT-ALIGN: center; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> <strong> </strong></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We also have an uncommitted credit facility in China in the amount of 40.0 million Chinese Yuan (approximately $6.5 million) that will expire on February 22, 2014.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> All of our credit facilities are unsecured.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> At both October 31, 2012 and July 31, 2013, we had $3.2 million of borrowings outstanding under our credit facility in China. At July 31, 2013, we had $2.5 million of unsecured borrowings assumed in Italy related to the acquisition of an Italian machine tool component business that we are operating as LCM Precision Technology (LCM). We had no other debt or borrowings under any of our other credit facilities. At July 31, 2013 we were in compliance with all covenants contained in our credit agreements and, as of that date, we had total unutilized credit facilities of approximately $22.6 million.</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0pt; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0pt; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" width="100%"> <tr style="VERTICAL-ALIGN: top"> <td style="WIDTH: 0px"> </td> <td style="WIDTH: 0.25in">2.</td> <td style="TEXT-ALIGN: justify">DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We are exposed to certain market risks relating to our ongoing business operations, including foreign currency risk, interest rate risk and credit risk. We manage our exposure to these and other market risks through regular operating and financing activities. Currently, the only risk that we manage through the use of derivative instruments is foreign currency risk in which we enter into derivative instruments in the form of foreign currency forward exchange contracts with a financial institution.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> These forward exchange contracts are entered into to reduce the potential effects of foreign exchange rate movements on our net equity investment in one of our foreign subsidiaries, to reduce the impact on gross profit and net earnings from sales and purchases denominated in foreign currencies, and to reduce the impact on our net earnings of foreign currency fluctuations on receivables and payables denominated in foreign currencies which are different than the subsidiaries functional currency. We are primarily exposed to foreign currency exchange rate risk with respect to transactions and net assets denominated in Euros, Pounds Sterling, Canadian Dollars, South African Rand, Singapore Dollars, Indian Rupee, Chinese Yuan, South Korean Won, Polish Zloty, and New Taiwan Dollars.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We record all derivative instruments as assets or liabilities at fair value.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> <u>Derivatives Designated as Hedging Instruments</u></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We enter into foreign currency forward exchange contracts periodically to hedge certain forecasted inter-company sales and purchases denominated in foreign currencies (the Pound Sterling, Euro and New Taiwan Dollar). The purpose of these instruments is to mitigate the risk that the U.S. Dollar net cash inflows and outflows resulting from sales and purchases denominated in foreign currencies will be adversely affected by changes in exchange rates. These forward contracts have been designated as cash flow hedge instruments, and are recorded in the Condensed Consolidated Balance Sheets at fair value in Derivative assets and Derivative liabilities. The effective portion of the gains and losses resulting from the changes in the fair value of these hedge contracts are deferred in Accumulated other comprehensive loss and recognized as an adjustment to Cost of sales and service in the period that the corresponding inventory sold that is the subject of the related hedge contract is recognized, thereby providing an offsetting economic impact against the corresponding change in the U.S. Dollar value of the inter-company sale or purchase being hedged. The ineffective portion of gains and losses resulting from the changes in the fair value of these hedge contracts is reported in Other (income) expense, net immediately. We perform quarterly assessments of hedge effectiveness by verifying and documenting the critical terms of the hedge instrument and determining that forecasted transactions have not changed significantly. We also assess on a quarterly basis whether there have been adverse developments regarding the risk of a counterparty default. We had forward contracts outstanding as of July 31, 2013, denominated in Euros, Pounds Sterling and New Taiwan Dollars with set maturity dates ranging from August 2013 through July 2014. The contract amounts, expressed at forward rates in U.S. Dollars at July 31, 2013, were $25.1 million for Euros, $7.4 million for Pounds Sterling and $20.2 million for New Taiwanese Dollars. At July 31, 2013, we had approximately $736,000 of losses, net of tax, related to cash flow hedges deferred in Accumulated other comprehensive loss. Included in this amount were $469,000 of unrealized losses, net of tax, related to cash flow hedge instruments that remain subject to currency fluctuation risk. The majority of these deferred losses will be recorded as an adjustment to Cost of sales and service in periods through July 2014, when the corresponding inventory that is the subject of the related hedge contracts are sold, as described above.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 8; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We are also exposed to foreign currency exchange risk related to our investment in net assets in foreign countries. To manage this risk, we have maintained a forward contract with a notional amount of €3.0 million. We designated this forward contract as a hedge of our net investment in Euro denominated assets. We selected the forward method under Financial Accounting Standards Board, or FASB, guidance related to the accounting for derivatives instruments and hedging activities. The forward method requires all changes in the fair value of the contract to be reported as a cumulative translation adjustment in Accumulated other comprehensive loss, net of tax, in the same manner as the underlying hedged net assets. This forward contract matures in November 2013. At July 31, 2013, we had $360,000 of realized gains and $90,000 of unrealized losses, net of tax, recorded as cumulative translation adjustments in Accumulated other comprehensive loss related to the hedging of our net investment in Euro denominated assets.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> <u>Derivatives Not Designated as Hedging Instruments</u></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We also enter into foreign currency forward exchange contracts to protect against the effects of foreign currency fluctuations on receivables and payables denominated in foreign currencies. These derivative instruments are not designated as hedges under the FASB guidance and, as a result, changes in their fair value are reported currently as Other (income) expense, net, in the Condensed Consolidated Statements of Operations consistent with the transaction gain or loss on the related receivables and payables denominated in foreign currencies.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We had forward contracts outstanding as of July 31, 2013, in Euros, Pounds Sterling, Canadian Dollars, the South African Rand, and the New Taiwan Dollar with set maturity dates ranging from August 2013 through October 2013. The aggregate amount of these contracts at forward rates in U.S. Dollars at July 31, 2013 totaled $45.8 million.</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 9; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> <u>Fair Value of Derivative Instruments</u></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We recognize the fair value of derivative instruments as assets and liabilities on a gross basis on our Condensed Consolidated Balance Sheets. As of July 31, 2013 and October 31, 2012, all derivative instruments were recorded at fair value on the balance sheets as follows (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="4">July 31, 2013</td> <td style="TEXT-ALIGN: center"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="4">October 31, 2012</td> <td style="TEXT-ALIGN: center"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center">Balance sheet</td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2">Fair</td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center">Balance sheet</td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2">Fair</td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid">Derivatives</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center"> Location</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">value</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center"> location</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">value</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center"> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center"> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-WEIGHT: bold; TEXT-ALIGN: left">Designated as hedging instruments:</td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 26%">Foreign exchange forward contracts</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 23%">Derivative assets</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">242</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 23%">Derivative assets</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">705</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contracts</td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">1,119</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">492</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left"><strong>Not designated as hedging instruments:</strong></td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-WEIGHT: normal; FONT-STYLE: normal; TEXT-ALIGN: left"> Foreign exchange forward contracts</td> <td> </td> <td style="TEXT-ALIGN: left">Derivative assets</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">42</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">Derivative assets</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">3</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contracts</td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">790</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">77</td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> <u>Effect of Derivative Instruments on Certain Condensed Consolidated Financial Statements</u></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Derivative instruments had the following effects (before tax) on our Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Income, Comprehensive Income and Changes in Shareholders' Equity during the nine months ended July 31, 2013 and 2012 (in thousands):</p> <p style="TEXT-ALIGN: center; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid">Derivatives</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6">Amount of gain (loss)<br /> recognized in Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center"> Location of gain<br /> (loss) reclassified<br /> from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6">Amount of gain (loss)<br /> reclassified from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="6"> Nine months ended<br /> July 31,</td> <td> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="6"> Nine months ended<br /> July 31,</td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2013</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2013</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Designated as hedging instruments:<br /> (Effective portion)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 25%">Foreign exchange forward contracts<br /> - Intercompany sales/purchases</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(1,088</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">4,069</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 19%">Cost of sales and service</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,723</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 13%">(627</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contract<br /> - Net investment</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">(100</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">484</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We recognized a loss of $32,000 for the nine months ended July 31, 2013, and a gain of $469,000 for the nine months ended July 31, 2012 as a result of contracts closed early that were deemed ineffective for financial reporting purposes and did not qualify as cash flow hedges. We recognized the following gains and losses in our Condensed Consolidated Statements of Income during the nine months ended July 31, 2013 and 2012 (in thousands) on derivative instruments not designated as hedging instruments:</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid" nowrap="nowrap"> Derivatives</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" nowrap="nowrap">Location of gain<br /> (loss) recognized in<br /> operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> Recognized in operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Nine months ended July 31,</td> <td nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td>Not designated as hedging instruments:</td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 58%">Foreign exchange forward contracts</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 15%">Other (income) expense, net</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(1,148</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">2,148</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The following table presents the changes in the components of Accumulated other comprehensive loss, net of tax, for the nine months ended July 31, 2013.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 95%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Foreign<br /> Currency<br /> Translation</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Cash Flow<br /> Hedges</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Total</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="WIDTH: 61%">Balance, October 31, 2012</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(1,908</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,055</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(853</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Other comprehensive income (loss) before reclassifications</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(614</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(693</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(1,307</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 1pt">Reclassifications</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (1,098</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (1,098</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 2.5pt">Balance, July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (2,522</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (736</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (3,258</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Derivative instruments had the following effects (before tax) on our Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Income, Comprehensive Income and Changes in Shareholders' Equity during the three months ended July 31, 2013 and 2012 (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid" nowrap="nowrap"> Derivatives</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> recognized in Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" nowrap="nowrap">Location of gain<br /> (loss) reclassified<br /> from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> reclassified from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Three months ended<br /> July 31,</td> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Three months ended<br /> July 31,</td> <td nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Designated as hedging instruments: (Effective portion)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 35%">Foreign exchange forward contracts - Intercompany sales/purchases</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(675</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,678</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 12%">Cost of sales and service</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">77</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">88</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contract - Net investment</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">(49</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">281</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 11; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We did not recognize gains or losses as a result of hedges deemed ineffective for the three months ended July 31, 2013. We recognized a gain of $202,000 for the three months ended July 31, 2012 as a result of contracts closed early that were deemed ineffective for financial reporting purposes and did not qualify as cash flow hedges. We recognized the following gains and losses in our Condensed Consolidated Statements of Income during the three months ended July 31, 2013 and 2012 (in thousands) on derivative instruments not designated as hedging instruments:</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid" nowrap="nowrap"> Derivatives</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" nowrap="nowrap">Location of gain<br /> (loss) recognized in<br /> operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> Recognized in operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Three months ended July 31,</td> <td nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2013</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 10pt; TEXT-ALIGN: center" colspan="2">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td>Not designated as hedging instruments:</td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 58%">Foreign exchange forward contracts</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 15%">Other (income) expense, net</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(561</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,099</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The following table presents the changes in the components of Accumulated other comprehensive loss, net of tax, for the three months ended July 31, 2013.</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 95%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Foreign<br /> Currency<br /> Translation</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Cash Flow<br /> Hedges</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Total</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="WIDTH: 61%">Balance, April 30, 2013</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(2,002</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(257</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(2,259</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Other comprehensive income (loss) before reclassifications</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(520</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(430</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(950</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 1pt">Reclassifications</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (49</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (49</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 2.5pt">Balance, July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (2,522</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (736</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (3,258</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> </tr> </table> <!--EndFragment--></div> </div>
77000
88000
1723000
-627000
-675000
1678000
-1088000
4069000
-49000
281000
-100000
484000
1909000
569000
1119000
492000
790000
77000
2013-08-01
2014-07-01
2013-11-30
2013-08-01
2013-10-01
202000
-32000
469000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top"> <td style="FONT-SIZE: 10pt; WIDTH: 24px">3.</td> <td style="FONT-SIZE: 10pt">EQUITY INCENTIVE PLAN</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> In March 2008, we adopted the Hurco Companies, Inc. 2008 Equity Incentive Plan (the "2008 Plan"), which allows us to grant awards of stock options, Stock Appreciation Rights settled in stock (SARs), restricted shares, performance shares and performance units. The 2008 Plan replaced the 1997 Stock Option and Incentive Plan, which expired in March 2007. The Compensation Committee of the Board of Directors has authority to determine the officers, directors and key employees who will be granted awards; designate the number of shares subject to each award; determine the terms and conditions upon which awards will be granted; and prescribe the form and terms of award agreements. We have granted stock options under both plans which are currently outstanding and restricted shares under the 2008 Plan which are outstanding. No stock option may be exercised more than ten years after the date of grant or such shorter period as the Compensation Committee may determine at the date of grant. The total number of shares of our common stock that may be issued as awards under the 2008 Plan is 750,000. The market value of a share of our common stock, for purposes of the 2008 Plan, is the closing sale price as reported by the Nasdaq Global Select Market on the date in question or, if not a trading day, on the last preceding trading date.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 12; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> A summary of stock option activity for the nine-month period ended July 31, 2013, is as follows:</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Stock<br /> Options</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted<br /> Average<br /> Exercise<br /> Price</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: right" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: right" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="WIDTH: 74%">Outstanding at October 31, 2012</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="TEXT-ALIGN: right; WIDTH: 10%">155,105</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">20.75</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Options granted</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">24,976</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">23.30</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left">Options exercised</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(11,369</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(26.69</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Options cancelled</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">-</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">-</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> </td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> </td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 2.5pt">Outstanding at July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 168,712</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 20.73</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Summarized information about outstanding stock options as of July 31, 2013, that have already vested and those that are expected to vest, as well as stock options that are currently exercisable, are as follows:</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 90%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Options already<br /> vested and expected<br /> to vest</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Options currently<br /> exercisable</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left; WIDTH: 74%">Number of outstanding options</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="TEXT-ALIGN: right; WIDTH: 10%">168,712</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="TEXT-ALIGN: right; WIDTH: 10%">106,579</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Weighted average remaining contractual life (years)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">6.91</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">4.96</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td>Weighted average exercise price per share</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">20.73</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">20.31</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td>Intrinsic value of outstanding options</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">1,384,000</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">946,000</td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The intrinsic value of an outstanding stock option is calculated as the difference between the stock price as of July 31, 2013 and the exercise price of the option.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> On December 12, 2012, the Compensation Committee granted a total of 24,976 stock options under the 2008 Plan to our executive officers. The fair value of the options was estimated on the date of grant using a Black-Scholes valuation model with assumptions for expected volatility based on the historical volatility of our common stock of 62%, expected term of the options of five years, dividend yield rate of 0% and a risk-free interest rate of .66% based upon the five-year U.S. Treasury yield as of the date of grant. The options vest over a three-year period beginning one year from the date of grant. Based upon the foregoing factors, the grant date fair value of the stock options was determined to be $12.11 per share.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> On December 12, 2012, the Compensation Committee granted a total of 12,983 shares of restricted stock to our executive officers. The restricted stock vests in full three years from the date of grant provided the recipient remains employed by us through that date. The grant date fair value of the restricted stock is based on the closing sales price of our common stock on the grant date which was $23.30 per share.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> On March 14, 2013, the Compensation Committee granted a total of 6,230 shares of restricted stock to our non-employee directors. The restricted stock vests in full one year from the date of grant provided the recipient remains on the board of directors through that date. The grant date fair value of the restricted stock is based on the closing sales price of our common stock on the grant date which was $28.08 per share.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 13; Value: 2 --> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> A reconciliation of the Company's restricted stock activity and related information is as follows:</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number of<br /> Shares</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted Average<br /> Grant Date<br /> Fair Value</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 12pt; WIDTH: 70%; TEXT-INDENT: -12pt"> Unvested at October 31, 2012</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="TEXT-ALIGN: right; WIDTH: 12%">55,718</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 12%">22.84</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-LEFT: 0.5in; TEXT-INDENT: -12pt">Shares granted</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">19,213</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">24.85</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 0.5in; TEXT-INDENT: -12pt">Shares vested</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(6,475</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(27.00</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.5in; TEXT-INDENT: -12pt"> Shares cancelled</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 2.5pt; PADDING-LEFT: 12pt; TEXT-INDENT: -12pt"> Unvested at July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 68,456</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 23.01</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> During the first nine months of fiscal 2013 and 2012, we recorded $741,000 and $646,000, respectively, as stock-based compensation expense attributable to grants of stock options and shares of restricted stock. As of July 31, 2013, there was $1.1 million of total unrecognized stock-based compensation expense that we expect to recognize by the end of the first quarter of fiscal 2016.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
0.13
0.61
0.96
1.78
0.13
0.61
0.96
1.77
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top"> <td style="FONT-SIZE: 10pt; WIDTH: 24px">4.</td> <td style="FONT-SIZE: 10pt; TEXT-ALIGN: justify">EARNINGS PER SHARE</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> <strong> </strong></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Per share results have been computed based on the average number of common shares outstanding. The computation of basic and diluted net income per share is determined using net income applicable to common shareholders as the numerator and the number of shares outstanding as the denominator as follows (in thousands, except per share amounts):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 8pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: justify" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">Three months ended</td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">Nine months ended</td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">July 31,</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">July 31,</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2013</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2012</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2013</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2012</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-LEFT: 0.65pt; TEXT-ALIGN: left; WIDTH: 20%"> Net income</td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">854</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">854</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">3,957</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">3,957</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">6,291</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">6,291</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%"> 11,552</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%"> 11,552</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.125in; TEXT-ALIGN: left; TEXT-INDENT: -0.125in"> Undistributed earnings Allocated to participating shares</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (9)</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left" nowrap="nowrap"> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> <font style="FONT-SIZE: 8pt">(9) </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (34</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (34</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (66</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (66</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (99</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (99</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.125in; TEXT-ALIGN: left; TEXT-INDENT: -0.125in"> Net income applicable to common shareholders</td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">845</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">845</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">3,923</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">3,923</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,225</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,225</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">11,453</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">11,453</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.125in; TEXT-ALIGN: left; TEXT-INDENT: -0.125in"> Weighted average shares outstanding</td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,458</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,458</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,447</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,447</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,452</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,452</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,444</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,444</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.65pt; TEXT-ALIGN: left"> Stock options</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 49</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 18</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 43</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 26</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-SIZE: 8pt; PADDING-LEFT: 0.65pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,458</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,507</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,447</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,465</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,452</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,495</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,444</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,470</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; PADDING-LEFT: 0.65pt"> Income per share</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.13</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.13</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.61</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.61</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.96</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.96</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 1.78</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 1.77</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
0.33
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1100000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">12.</td> <td style="TEXT-ALIGN: justify">FINANCIAL INSTRUMENTS</td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The carrying amounts for cash and cash equivalents approximate their fair values due to the short maturity of these instruments and meet the Level 1 criteria of the three-tier fair value hierarchy discussed below. The carrying amount of short-term debt approximates fair value due to the short term nature of the instruments. Accordingly, the fair value is based on an internally developed model using current interest rate data for similar issues as there is no active markets for this type of facility and meets the Level 2 criteria of the three-tier fair value hierarchy discussed below.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Derivative instruments are reported in the accompanying consolidated financial statements at fair value. We have derivative financial instruments in the form of foreign currency forward exchange contracts as described in Note 2. The U.S. Dollar equivalent notional amounts of these contracts were $101.8 million and $107.3 million at July 31, 2013 and October 31, 2012, respectively. The fair value of Derivative assets recorded on our Condensed Consolidated Balance Sheets was $284,000 at July 31, 2013 and $708,000 at October 31, 2012. The fair value of Derivative liabilities recorded on our Condensed Consolidated Balance Sheets was $1.9 million at July 31, 2013 and $569,000 at October 31, 2012.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The fair value of our foreign currency forward exchange contracts and the related currency positions are subject to offsetting market risk resulting from foreign currency exchange rate volatility. The counterparty to the forward exchange contracts is a substantial and creditworthy financial institution. We do not consider either the risk of counterparty non-performance or the economic consequences of counterparty non-performance as material risks.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> FASB guidance establishes a three-tier fair value hierarchy, which categorizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exist, therefore requiring an entity to develop its own assumptions.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> In accordance with this guidance, the following table represents the fair value hierarchy for our financial assets and liabilities measured at fair value as of July 31, 2013 and October 31, 2012 (in thousands):</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px 0pt 0.25in; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 90%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Assets</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Liabilities</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31,<br /> 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">October 31,<br /> 2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31,<br /> 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">October 31,<br /> 2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 0px; TEXT-DECORATION: underline">Level 1</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0px; WIDTH: 48%"> Deferred Compensation</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,017</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">861</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">-</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">-</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 5.4pt"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-LEFT: 0px; TEXT-DECORATION: underline">Level 2</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0px">Derivatives</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">284</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">708</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">1,909</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">569</td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Included in Level 1 assets are mutual fund investments under a nonqualified deferred compensation plan. We estimate the fair value of these investments on a recurring basis using readily available market prices. Included as Level 2 fair value measurements are derivative assets and liabilities related to hedged and unhedged gains and losses on foreign currency forward exchange contracts entered into with a third party. We estimate the fair value of these derivatives on a recurring basis using foreign currency exchange rates obtained from active markets.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">11.</td> <td style="TEXT-ALIGN: justify">INCOME TAXES</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; font-size-adjust: none; font-stretch: normal"> Our effective tax rate for the first nine months of fiscal 2013 was 33% in comparison to 30% for the same period in fiscal 2012. The increase in the effective income tax rate was primarily due to changes in the geographic mix of income or loss between tax jurisdictions. We recorded income tax expense during the first nine months of fiscal 2013 of approximately $3.0 million compared to $5.0 million for the same period in fiscal 2012, primarily as a result of the reduction in pre-tax income period-over-period. We have not provided any U.S. income taxes on the undistributed earnings of our wholly-owned foreign subsidiaries based upon our determination that such earnings will be indefinitely reinvested. In the event these earnings are later distributed to the U.S., such distributions would likely result in additional U.S. tax that may be offset, at least in part by associated foreign tax credits.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; font-size-adjust: none; font-stretch: normal"> A reconciliation of the beginning and ending amount of unrecognized tax benefits, including the related gross amount of accrued interest, is as follows (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 90%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right" colspan="2">2013</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt; WIDTH: 85%"> Balance at October 31, 2012</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 12%">132</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> Additions based on tax positions related to the current year</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">1,109</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> Additions (reductions) related to prior years tax positions</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">23</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> Additions (reductions) related to accrued interest</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">4</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> </td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> Balance at July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 1,268</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We recognize accrued interest and penalties related to unrecognized tax benefits as components of income tax expense. We have accrued for penalties where expected, however, in general we believe our unrecognized tax positions meet the minimum statutory threshold to avoid payment of penalties.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We file U.S. federal and state income tax returns, as well as tax returns in several foreign jurisdictions. The statutes of limitations with respect to unrecognized tax benefits will expire between July 2014 and July 2018.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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194000
105000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top"> <td style="FONT-SIZE: 10pt; WIDTH: 48px">6.</td> <td style="FONT-SIZE: 10pt; TEXT-ALIGN: justify">INVENTORIES</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> <strong> </strong></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Inventories, priced at the lower of cost (first-in, first-out method) or market, are summarized below (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31, 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">October 31, 2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px; WIDTH: 74%"> Purchased parts and sub-assemblies</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">22,441</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">18,780</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px"> Work-in-process</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">15,621</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">14,256</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Finished goods</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> 58,099</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> 58,284</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 96,161</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 91,320</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
58099000
58284000
96161000
91320000
15621000
14256000
14000
16000
61000
57000
4000
3000
19000
5000
782000
782000
3629000
3467000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">13.</td> <td style="TEXT-ALIGN: justify">CONTINGENCIES AND LITIGATION</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We are involved in various claims and lawsuits arising in the normal course of business. We do not expect any of these claims, individually or in the aggregate, to have a material adverse effect on our consolidated financial position or results of operations.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
61101000
51519000
209512000
195312000
57051000
49372000
1080000
3200000
3200000
2500000
2014-12-07
2014-12-07
2014-12-07
2014-02-22
12500000
3000000
100000000
3300000
1000000
1500000
40000000
6500000
22600000
0.0005
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top"> <td style="FONT-SIZE: 10pt; WIDTH: 7%">5.</td> <td style="FONT-SIZE: 10pt; TEXT-ALIGN: justify; WIDTH: 92%"> ACCOUNTS RECEIVABLE</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> Accounts receivable are net of allowances for doubtful accounts of $562,000 as of July 31, 2013 and $384,000 as of October 31, 2012.</p> <!--EndFragment--></div> </div>
18922000
17411000
-2215000
1182000
-2214000
2291000
-996000
-1299000
-2325000
-2639000
4621000
-4261000
13444000
-8440000
854000
3957000
6291000
11552000
6291000
11552000
845000
3923000
6225000
11453000
1703000
5812000
10303000
16671000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0pt; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0pt; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" width="100%"> <tr style="VERTICAL-ALIGN: top"> <td style="WIDTH: 0.25in">1.</td> <td style="TEXT-ALIGN: justify">GENERAL</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> <strong> </strong></p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The unaudited Condensed Consolidated Financial Statements include the accounts of Hurco Companies, Inc. and its consolidated subsidiaries. As used in this report, unless the context indicates otherwise, the terms "we", "us", "our" and similar language refer to Hurco Companies, Inc. and its consolidated subsidiaries as a whole. We design and produce computerized machine tools, interactive computer control systems, machine tool components, and software for sale through our distribution network to the worldwide metal cutting market. We also provide software options, computer control upgrades, accessories and replacement parts for our products, as well as customer service and training support.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The condensed financial information as of July 31, 2013 and for the three and nine months ended July 31, 2013 and July 31, 2012 is unaudited; however, in our opinion, the interim data includes all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our consolidated financial position, results of operations, changes in shareholders' equity and cash flows at the end of the interim periods. We suggest that you read these condensed consolidated financial statements in conjunction with the financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended October 31, 2012.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
9008000
7645000
5901000
5288000
-520000
-614000
-430000
-693000
-950000
-1307000
-520000
-2648000
-614000
-2900000
-999000
-1639000
-2405000
81000
-2405000
81000
49000
56000
1098000
-398000
49000
1098000
-28000
-32000
-625000
229000
-430000
1065000
-693000
2583000
-245000
613000
-395000
1486000
22441000
18780000
-530000
-190000
-861000
-69000
8000
6000
48000
36000
323000
323000
323000
380000
380000
380000
375000
1034000
1147000
1928000
233000
259000
750000
675000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="WIDTH: 0in"> </td> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">14.</td> <td style="TEXT-ALIGN: justify">EMPLOYEE BENEFITS</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We have defined contribution plans that include a majority of our employees, under which our matching contributions are primarily discretionary. The purpose of these plans is generally to provide additional financial security during retirement by providing employees with an incentive to save throughout their employment. Our matching contributions to the plans are based on employee contributions or compensation. Our total contributions to all plans were approximately $583,000 and $339,000, for the nine months ended July 31, 2013 and 2012, respectively.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="WIDTH: 0in"> </td> </tr> </table> <!--EndFragment--></div> </div>
0.00
0.00
1000000
1000000
0
0
1182000
2290000
303000
303000
1000
1650000
1623000
1562000
1725000
1650000
1623000
-11000
-36000
2705000
2570000
2743000
2443000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="WIDTH: 0in"> </td> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">9.</td> <td style="TEXT-ALIGN: justify">GUARANTEES AND WARRANTIES</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We follow FASB guidance for accounting for contingencies relating to the guarantor's accounting for, and disclosures of, the issuance of certain types of guarantees.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; font-size-adjust: none; font-stretch: normal"> From time to time, our subsidiaries guarantee third party payment obligations in connection with the sale of machines to customers that use financing. As of July 31, 2013, we had 20 outstanding third party payment guarantees totaling approximately $1.3 million. The terms of these guarantees are consistent with the underlying customer financing terms. Upon shipment of a machine, the customer has the risk of ownership. The customer does not obtain title, however, until it has paid for the machine. A retention of title clause allows us to recover the machine if the customer defaults on the financing. We accrue for potential liabilities under these guarantees when we believe a loss is probable and can be estimated.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; BACKGROUND-COLOR: white; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We provide warranties on our products with respect to defects in material and workmanship. The terms of these warranties are generally one year for machines and certain components and shorter periods for service parts. We recognize a reserve with respect to this obligation at the time of product sale, with subsequent warranty claims recorded against the reserve. The amount of the warranty reserve is determined based on historical trend experience and any known warranty issues that could cause future warranty costs to differ from historical experience. A reconciliation of the changes in our warranty reserve is as follows (in thousands):</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 90%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Nine months ended</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31, 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31, 2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px; WIDTH: 74%"> Balance, beginning of period</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,623</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,725</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: justify; TEXT-INDENT: 0px">Provision for warranties during the period</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">2,743</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">2,443</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Charges to the reserve</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(2,705</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(2,570</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Impact of foreign currency translation</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (11</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (36</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Balance, end of period</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 1,650</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 1,562</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> The warranty accrual increased slightly year-over-year as actual claims for specific warranties accrued were higher than in prior year resulting in an adjustment to the provision for warranties during the year.</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
30659000
29012000
12450000
12079000
2205000
2205000
96554000
90586000
45158000
49959000
138862000
147050000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 95%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: justify" colspan="2" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="COLOR: black" nowrap="nowrap"> </td> <td style="COLOR: black; TEXT-ALIGN: justify" nowrap="nowrap"> Remaining<br /> Economic</td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="TEXT-ALIGN: justify" colspan="2" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: justify" nowrap="nowrap">Useful Life</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 0px; WIDTH: 69%"> Trademark/name</td> <td style="COLOR: black; WIDTH: 1%"> </td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="COLOR: black; TEXT-ALIGN: right; WIDTH: 12%">274</td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="COLOR: black; WIDTH: 1%"> </td> <td style="COLOR: black; TEXT-ALIGN: center; PADDING-LEFT: 5.4pt; WIDTH: 15%"> 13 years</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 0px"> Technology and manufacturing know how</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">1,110</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: center; PADDING-LEFT: 5.4pt"> 13 years</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: justify; PADDING-LEFT: 0px"> Customer relationships</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 52</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: center; PADDING-LEFT: 5.4pt"> 16 years</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: right"> 1,437</td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 95%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Foreign<br /> Currency<br /> Translation</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Cash Flow<br /> Hedges</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Total</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="WIDTH: 61%">Balance, October 31, 2012</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(1,908</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,055</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(853</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Other comprehensive income (loss) before reclassifications</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(614</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(693</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(1,307</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 1pt">Reclassifications</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (1,098</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (1,098</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 2.5pt">Balance, July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (2,522</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (736</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (3,258</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 95%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Foreign<br /> Currency<br /> Translation</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Cash Flow<br /> Hedges</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Total</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="WIDTH: 61%">Balance, April 30, 2013</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(2,002</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(257</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(2,259</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Other comprehensive income (loss) before reclassifications</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(520</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(430</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(950</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 1pt">Reclassifications</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (49</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (49</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 2.5pt">Balance, July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (2,522</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (736</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> (3,258</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left">)</td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px 0pt 0.25in; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: center; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid">Derivatives</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6">Amount of gain (loss)<br /> recognized in Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center"> Location of gain<br /> (loss) reclassified<br /> from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6">Amount of gain (loss)<br /> reclassified from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="6"> Nine months ended<br /> July 31,</td> <td> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="6"> Nine months ended<br /> July 31,</td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2013</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2013</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Designated as hedging instruments:<br /> (Effective portion)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 25%">Foreign exchange forward contracts<br /> - Intercompany sales/purchases</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(1,088</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">4,069</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 19%">Cost of sales and service</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,723</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 13%">(627</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contract<br /> - Net investment</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">(100</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">484</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We recognized a loss of $32,000 for the nine months ended July 31, 2013, and a gain of $469,000 for the nine months ended July 31, 2012 as a result of contracts closed early that were deemed ineffective for financial reporting purposes and did not qualify as cash flow hedges. We recognized the following gains and losses in our Condensed Consolidated Statements of Income during the nine months ended July 31, 2013 and 2012 (in thousands) on derivative instruments not designated as hedging instruments:</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid" nowrap="nowrap"> Derivatives</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" nowrap="nowrap">Location of gain<br /> (loss) recognized in<br /> operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> Recognized in operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Nine months ended July 31,</td> <td nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td>Not designated as hedging instruments:</td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 58%">Foreign exchange forward contracts</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 15%">Other (income) expense, net</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(1,148</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">2,148</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid" nowrap="nowrap"> Derivatives</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> recognized in Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" nowrap="nowrap">Location of gain<br /> (loss) reclassified<br /> from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> reclassified from Other<br /> comprehensive loss</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Three months ended<br /> July 31,</td> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Three months ended<br /> July 31,</td> <td nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Designated as hedging instruments: (Effective portion)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 35%">Foreign exchange forward contracts - Intercompany sales/purchases</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(675</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,678</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 12%">Cost of sales and service</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">77</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">88</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contract - Net investment</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">(49</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">281</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!-- Field: Page; Sequence: 11; Value: 2 --> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We did not recognize gains or losses as a result of hedges deemed ineffective for the three months ended July 31, 2013. We recognized a gain of $202,000 for the three months ended July 31, 2012 as a result of contracts closed early that were deemed ineffective for financial reporting purposes and did not qualify as cash flow hedges. We recognized the following gains and losses in our Condensed Consolidated Statements of Income during the three months ended July 31, 2013 and 2012 (in thousands) on derivative instruments not designated as hedging instruments:</p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid" nowrap="nowrap"> Derivatives</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" nowrap="nowrap">Location of gain<br /> (loss) recognized in<br /> operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Amount of gain (loss)<br /> Recognized in operations</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" nowrap="nowrap"> </td> <td nowrap="nowrap"> </td> <td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Three months ended July 31,</td> <td nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2013</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 10pt; TEXT-ALIGN: center" colspan="2">2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td>Not designated as hedging instruments:</td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 58%">Foreign exchange forward contracts</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 15%">Other (income) expense, net</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">(561</td> <td style="TEXT-ALIGN: left; WIDTH: 1%">)</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,099</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="4">July 31, 2013</td> <td style="TEXT-ALIGN: center"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="4">October 31, 2012</td> <td style="TEXT-ALIGN: center"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center">Balance sheet</td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2">Fair</td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center">Balance sheet</td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2">Fair</td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td style="BORDER-BOTTOM: black 1pt solid">Derivatives</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center"> Location</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">value</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center"> location</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">value</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td style="TEXT-ALIGN: center"> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: center"> </td> <td> </td> <td style="TEXT-ALIGN: center" colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-WEIGHT: bold; TEXT-ALIGN: left">Designated as hedging instruments:</td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; WIDTH: 26%">Foreign exchange forward contracts</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 23%">Derivative assets</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">242</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 23%">Derivative assets</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">705</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contracts</td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">1,119</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">492</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left"><strong>Not designated as hedging instruments:</strong></td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-WEIGHT: normal; FONT-STYLE: normal; TEXT-ALIGN: left"> Foreign exchange forward contracts</td> <td> </td> <td style="TEXT-ALIGN: left">Derivative assets</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">42</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">Derivative assets</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">3</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left">Foreign exchange forward contracts</td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">790</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">Derivative liabilities</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">77</td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 8pt Times New Roman, Times, Serif; WIDTH: 100%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: justify" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">Three months ended</td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">Nine months ended</td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">July 31,</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">July 31,</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2013</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2012</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2013</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2012</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Basic</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt" nowrap="nowrap"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt" colspan="2" nowrap="nowrap">Diluted</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom"> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt" colspan="2"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-LEFT: 0.65pt; TEXT-ALIGN: left; WIDTH: 20%"> Net income</td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">854</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">854</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">3,957</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">3,957</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">6,291</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%">6,291</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%"> 11,552</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right; WIDTH: 7%"> 11,552</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left; WIDTH: 1%"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.125in; TEXT-ALIGN: left; TEXT-INDENT: -0.125in"> Undistributed earnings Allocated to participating shares</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (9)</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left" nowrap="nowrap"> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> <font style="FONT-SIZE: 8pt">(9) </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (34</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (34</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (66</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (66</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (99</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> (99</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> )</td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.125in; TEXT-ALIGN: left; TEXT-INDENT: -0.125in"> Net income applicable to common shareholders</td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">845</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">845</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">3,923</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">3,923</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,225</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,225</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">11,453</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left">$</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">11,453</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.125in; TEXT-ALIGN: left; TEXT-INDENT: -0.125in"> Weighted average shares outstanding</td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,458</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,458</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,447</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,447</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,452</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,452</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,444</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,444</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.65pt; TEXT-ALIGN: left"> Stock options</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 49</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 18</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 43</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> -</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 1pt solid; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 26</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="FONT-SIZE: 8pt; PADDING-LEFT: 0.65pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,458</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,507</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,447</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,465</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,452</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,495</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,444</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: right">6,470</td> <td style="FONT-SIZE: 8pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 8pt"> </font> </td> </tr> <tr style="FONT-SIZE: 8pt; VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; PADDING-LEFT: 0.65pt"> Income per share</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.13</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left" nowrap="nowrap"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.13</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.61</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.61</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.96</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 0.96</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 1.78</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt"><font style="FONT-SIZE: 8pt"> </font> </td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; FONT-SIZE: 8pt; TEXT-ALIGN: right"> 1.77</td> <td style="FONT-SIZE: 8pt; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> <font style="FONT-SIZE: 8pt"> </font> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px 0pt 0.25in; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 90%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Assets</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Liabilities</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31,<br /> 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">October 31,<br /> 2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31,<br /> 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">October 31,<br /> 2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 0px; TEXT-DECORATION: underline">Level 1</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0px; WIDTH: 48%"> Deferred Compensation</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,017</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">861</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">-</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">-</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 5.4pt"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-LEFT: 0px; TEXT-DECORATION: underline">Level 2</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0px">Derivatives</td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">284</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">708</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">1,909</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left">$</td> <td style="TEXT-ALIGN: right">569</td> <td style="TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31, 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">October 31, 2012</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px; WIDTH: 74%"> Purchased parts and sub-assemblies</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">22,441</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">18,780</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px"> Work-in-process</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">15,621</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">14,256</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Finished goods</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> 58,099</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> 58,284</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: justify; PADDING-LEFT: 5.4pt"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 96,161</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 91,320</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 90%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Nine months ended</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom"> <td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31, 2013</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">July 31, 2012</td> <td style="PADDING-BOTTOM: 1pt"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px; WIDTH: 74%"> Balance, beginning of period</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,623</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 10%">1,725</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: justify; TEXT-INDENT: 0px">Provision for warranties during the period</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">2,743</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">2,443</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Charges to the reserve</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(2,705</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(2,570</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Impact of foreign currency translation</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (11</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> (36</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="TEXT-ALIGN: justify; PADDING-LEFT: 0px">Balance, end of period</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 1,650</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 1,562</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 80%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; WIDTH: 85%"> Current assets</td> <td style="COLOR: black; WIDTH: 1%"> </td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="COLOR: black; TEXT-ALIGN: right; WIDTH: 12%">6,659</td> <td style="COLOR: black; TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Property plant and equipment</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">933</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Intangibles</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">1,437</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Goodwill</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 2,477</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> Total assets</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left">$</td> <td style="COLOR: black; TEXT-ALIGN: right">11,506</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right"> </td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Current liabilities</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left">$</td> <td style="COLOR: black; TEXT-ALIGN: right">4,793</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px">Short term debt</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">4,643</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Non-current liabilities</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 1,690</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> Total Liabilities</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 11,126</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> </td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px">Cash expended, net of cash acquired</td> <td style="COLOR: black"> </td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> <td style="COLOR: black; TEXT-ALIGN: right">380</td> <td style="COLOR: black; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px"> Indebtedness assumed</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; COLOR: black; TEXT-ALIGN: right"> 4,643</td> <td style="COLOR: black; PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="COLOR: black; TEXT-ALIGN: left; PADDING-LEFT: 0px; TEXT-INDENT: 0.125in"> Total purchase price</td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; COLOR: black; TEXT-ALIGN: right"> 5,023</td> <td style="COLOR: black; PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <table style="BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif; WIDTH: 85%; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0" align="center"> <tr style="VERTICAL-ALIGN: bottom"> <td nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number of<br /> Shares</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted Average<br /> Grant Date<br /> Fair Value</td> <td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 12pt; WIDTH: 70%; TEXT-INDENT: -12pt"> Unvested at October 31, 2012</td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="TEXT-ALIGN: right; WIDTH: 12%">55,718</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> <td style="WIDTH: 1%"> </td> <td style="TEXT-ALIGN: left; WIDTH: 1%">$</td> <td style="TEXT-ALIGN: right; WIDTH: 12%">22.84</td> <td style="TEXT-ALIGN: left; WIDTH: 1%"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-LEFT: 0.5in; TEXT-INDENT: -12pt">Shares granted</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">19,213</td> <td style="TEXT-ALIGN: left"> </td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">24.85</td> <td style="TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-LEFT: 0.5in; TEXT-INDENT: -12pt">Shares vested</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(6,475</td> <td style="TEXT-ALIGN: left">)</td> <td> </td> <td style="TEXT-ALIGN: left"> </td> <td style="TEXT-ALIGN: right">(27.00</td> <td style="TEXT-ALIGN: left">)</td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: white"> <td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.5in; TEXT-INDENT: -12pt"> Shares cancelled</td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 1pt"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left"> </td> <td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right"> -</td> <td style="PADDING-BOTTOM: 1pt; TEXT-ALIGN: left"> </td> </tr> <tr style="VERTICAL-ALIGN: bottom; BACKGROUND-COLOR: rgb(204,255,204)"> <td style="PADDING-BOTTOM: 2.5pt; PADDING-LEFT: 12pt; TEXT-INDENT: -12pt"> Unvested at July 31, 2013</td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 68,456</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> <td style="PADDING-BOTTOM: 2.5pt"> </td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left"> $</td> <td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right"> 23.01</td> <td style="PADDING-BOTTOM: 2.5pt; TEXT-ALIGN: left"> </td> </tr> </table> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <table style="MARGIN-BOTTOM: 0px; FONT: 10pt Times New Roman, Times, Serif; MARGIN-TOP: 0px; font-size-adjust: none; font-stretch: normal" cellspacing="0" cellpadding="0"> <tr style="VERTICAL-ALIGN: top; TEXT-ALIGN: justify"> <td style="WIDTH: 0in"> </td> <td style="TEXT-ALIGN: left; WIDTH: 0.25in">8.</td> <td style="TEXT-ALIGN: justify">SEGMENT INFORMATION</td> </tr> </table> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <p style="TEXT-ALIGN: justify; FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; font-size-adjust: none; font-stretch: normal"> We operate in a single segment: industrial automation systems. We design and produce interactive computer control systems and software, computerized machine tools and machine tool components for sale through our own distribution network to the worldwide metal-working market. We also provide software options, control upgrades, accessories and replacement parts for our products, as well as customer service and training support. The results related to the acquired business of LCM from the date of purchase, July 1, 2013, are included within the industrial automation systems segment.</p> <p style="FONT: 10pt Times New Roman, Times, Serif; MARGIN: 0pt 0px; TEXT-INDENT: 0.5in; font-size-adjust: none; font-stretch: normal"> </p> <!--EndFragment--></div> </div>
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1384000
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