Company: CPSH
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001437749-25-014320
Chunk: 9

Company: CPS TECHNOLOGIES CORP/DE/
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 1
Chunk 9
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 with 5.9 times averaged during the four quarters of 2024.

The Company expects it will continue to be able to fund its operations for the remainder of 2025 from operations and existing cash balances.

The Company continues to sell to a limited number of customers and the loss of any one of these customers could cause the Company to require additional external financing. Failure to generate sufficient revenues, raise additional capital or reduce certain discretionary spending could have a material adverse effect on the Company’s ability to achieve its business objectives.

Management believes that existing cash balances will be sufficient to fund our cash requirements for the foreseeable future. However, there is no assurance that we will be able to generate sufficient revenues or reduce certain discretionary spending in the event that planned operational goals are not met such that we will be able to meet our obligations as they become due.

Contractual Obligations (all $ in 000’ s unless otherwise noted)

The Company maintains a $3.0 million revolving line of credit (LOC) with Rockland Trust Company. The LOC is secured by the accounts receivable and other assets of the Company and has an interest rate of the National Prime Rate as published by the Wall Street Journal. On March 29, 2025, the Company had $0 of borrowings under this LOC and its borrowing base at the time would have permitted the full $3.0 million to have been borrowed. The LOC remains in effect until terminated per mutual agreement by both parties.

In March 2020, the Company acquired a scanning acoustic microscope for a price of $208 thousand. The full amount was financed through a 5 year note payable with a financing company. The note was paid in full during the quarter ended March 29, 2025.

The Company has one real estate lease expiring in February 2026. CPS also has a few other leases for equipment which are minor in nature and are generally short-term in duration. None of these have been capitalized. (Note 4, Leases)

  ITEM 3      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  
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The Company is not significantly exposed to the impact of interest rate changes. The Company has not used derivative financial instruments. As one of our major competitors is located in Japan, currency fluctuations can have an impact on how we price our product in order to remain competitive.

Although CPS has not been directly impacted by the war in Ukraine or by the conflict in Israel and Gaza