##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number 000-01227
 CHICAGO RIVET & MACHINE CO.
  Illinois
    
    36-0904920(State or Other Jurisdiction
    
    (I.R.S. Employerof Incorporation or Organization)
    
    Identification No.)901 Frontenac Road, Naperville, Illinois
    
    60563(Address of Principal Executive Offices)
    
    (Zip Code)
 (630) 357-8500
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company þ
 o þ




---



##### 



PagePART I. FINANCIAL INFORMATION (Unaudited)Condensed Consolidated Balance Sheets at
June 30, 2009 and December 31, 2008
    
    
    2-3Condensed Consolidated Statements of Operations
for the Three and Six Months Ended June 30, 2009 and 2008
    
    
    4Condensed Consolidated Statements of Retained Earnings for the
Six Months Ended June 30, 2009 and 2008
    
    
    5Condensed Consolidated Statements of Cash Flows for the
Six Months Ended June 30, 2009 and 2008
    
    
    6Notes to the Condensed Consolidated Financial Statements
    
    
    7-9Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    10-11Controls and Procedures
    
    
    12PART II. OTHER INFORMATION
    
    
    13-15EX-31.1EX-31.2EX-32.1EX-32.2
  1




---



##### Table of Contents



June 30,
    
    
    December 31,2009
    
    
    2008(Unaudited)AssetsCurrent Assets:Cash and cash equivalents
    
    $
    823,426
    
    
    $
    1,553,226Certificates of deposit
    
    
    6,739,000
    
    
    
    5,997,000Accounts receivable, net of allowance
of $150,000 and $165,000, respectively
    
    
    2,916,648
    
    
    
    3,315,748Inventories
    
    
    4,086,896
    
    
    
    5,048,632Deferred income taxes
    
    
    458,191
    
    
    
    504,191Prepaid income taxes
    
    
    836,726
    
    
    
    355,788Other current assets
    
    
    207,486
    
    
    
    234,412Total current assets
    
    
    16,068,373
    
    
    
    17,008,997Property, Plant and Equipment:Land and improvements
    
    
    1,029,035
    
    
    
    1,029,035Buildings and improvements
    
    
    6,391,952
    
    
    
    6,391,952Production equipment and other
    
    
    28,232,381
    
    
    
    28,163,59035,653,368
    
    
    
    35,584,577Less accumulated depreciation
    
    
    27,648,179
    
    
    
    27,184,604Net property, plant and equipment
    
    
    8,005,189
    
    
    
    8,399,973Total assets
    
    $
    24,073,562
    
    
    $
    25,408,970
  2




---



##### Table of Contents



June 30,
    
    
    December 31,2009
    
    
    2008(Unaudited)Liabilities and Shareholders EquityCurrent Liabilities:Accounts payable
    
    $
    762,599
    
    
    $
    509,657Accrued wages and salaries
    
    
    563,736
    
    
    
    456,687Other accrued expenses
    
    
    322,398
    
    
    
    292,418Unearned revenue and customer deposits
    
    
    53,780
    
    
    
    376,325Total current liabilities
    
    
    1,702,513
    
    
    
    1,635,087Deferred income taxes
    
    
    796,275
    
    
    
    865,275Total liabilities
    
    
    2,498,788
    
    
    
    2,500,362Commitments and contingencies (Note 4)
    
    
    
    
    
    
    Shareholders Equity:Preferred stock, no par value, 500,000 sharesauthorized: none outstanding
    
    
    
    
    
    
    Common stock, $1.00 par value, 4,000,000 sharesauthorized: 1,138,096 shares issued
    
    
    1,138,096
    
    
    
    1,138,096Additional paid-in capital
    
    
    447,134
    
    
    
    447,134Retained earnings
    
    
    23,911,642
    
    
    
    25,245,476Treasury stock, 171,964 shares at cost
    
    
    (3,922,098
    )
    
    
    (3,922,098
    )Total shareholders equity
    
    
    21,574,774
    
    
    
    22,908,608Total liabilities and shareholders equity
    
    $
    24,073,562
    
    
    $
    25,408,970
  3




---



##### Table of Contents



Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Net sales
    
    $
    4,679,823
    
    
    $
    8,047,012
    
    
    $
    9,439,113
    
    
    $
    16,461,338Cost of goods sold
    
    
    4,143,455
    
    
    
    6,813,916
    
    
    
    8,630,134
    
    
    
    13,914,995Gross profit
    
    
    536,368
    
    
    
    1,233,096
    
    
    
    808,979
    
    
    
    2,546,343Selling and administrative expenses
    
    
    1,234,910
    
    
    
    1,323,611
    
    
    
    2,514,985
    
    
    
    2,672,717Operating profit (loss)
    
    
    (698,542
    )
    
    
    (90,515
    )
    
    
    (1,706,006
    )
    
    
    (126,374
    )Other income and expenses:Interest income
    
    
    25,802
    
    
    
    53,925
    
    
    
    75,806
    
    
    
    129,847Other income
    
    
    4,282
    
    
    
    4,178
    
    
    
    7,882
    
    
    
    7,778Income (loss) before income taxes
    
    
    (668,458
    )
    
    
    (32,412
    )
    
    
    (1,622,318
    )
    
    
    11,251Provision
(benefit) for income taxes
    
    
    (229,000
    )
    
    
    (13,000
    )
    
    
    (559,000
    )
    
    
    3,000Net income (loss)
    
    $
    (439,458
    )
    
    $
    (19,412
    )
    
    $
    (1,063,318
    )
    
    $
    8,251Average common shares outstanding
    
    
    966,132
    
    
    
    966,132
    
    
    
    966,132
    
    
    
    966,132Per share data:Net income (loss) per share
    
    $
    (0.45
    )
    
    $
    (0.02
    )
    
    $
    (1.10
    )
    
    $
    0.01Cash dividends declared per share
    
    $
    0.10
    
    
    $
    0.18
    
    
    $
    0.28
    
    
    $
    0.51
  4




---



##### Table of Contents



2009
    
    
    2008Retained earnings at beginning of period
    
    $
    25,245,476
    
    
    $
    26,911,493Net income (loss) for the six months ended
    
    
    (1,063,318
    )
    
    
    8,251Cash dividends declared in the period;
$.28 per share in 2009 and $.51 per share in 2008
    
    
    (270,516
    )
    
    
    (492,727
    )Retained earnings at end of period
    
    $
    23,911,642
    
    
    $
    26,427,017
  5




---



##### Table of Contents



2009
    
    
    2008Cash flows from operating activities:Net income (loss)
    
    $
    (1,063,318
    )
    
    $
    8,251Adjustments to reconcile net income (loss) to net cash
provided by operating activities:Depreciation
    
    
    503,661
    
    
    
    534,546Net (gain) loss on disposal of equipment
    
    
    (1,089
    )
    
    
    3,951Deferred income taxes
    
    
    (23,000
    )
    
    
    (75,000
    )Changes in operating assets and liabilities:Accounts receivable, net
    
    
    399,100
    
    
    
    253,384Inventories
    
    
    961,736
    
    
    
    (513,780
    )Other current assets
    
    
    (454,012
    )
    
    
    287,226Accounts payable
    
    
    252,942
    
    
    
    188,759Accrued wages and salaries
    
    
    107,049
    
    
    
    58,782Other accrued expenses
    
    
    29,980
    
    
    
    (193,085
    )Unearned revenue and customer deposits
    
    
    (322,545
    )
    
    
    (58,629
    )Net cash provided by operating activities
    
    
    390,504
    
    
    
    494,405Cash flows from investing activities:Capital expenditures
    
    
    (117,464
    )
    
    
    (157,599
    )Proceeds from the sale of equipment
    
    
    9,676
    
    
    
    400Proceeds from certificates of deposit
    
    
    5,597,000
    
    
    
    9,950,000Purchases of certificates of deposit
    
    
    (6,339,000
    )
    
    
    (7,400,000
    )Net cash (used in) provided by investing activities
    
    
    (849,788
    )
    
    
    2,392,801Cash flows from financing activities:Cash dividends paid
    
    
    (270,516
    )
    
    
    (492,727
    )Net cash used in financing activities
    
    
    (270,516
    )
    
    
    (492,727
    )Net (decrease) increase in cash and cash equivalents
    
    
    (729,800
    )
    
    
    2,394,479Cash and cash equivalents at beginning of period
    
    
    1,553,226
    
    
    
    665,072Cash and cash equivalents at end of period
    
    $
    823,426
    
    
    $
    3,059,551Supplemental schedule of non-cash investing activities:Capital expenditures in accounts payable
    
    $
    
    
    
    $
    26,800
  6




---



##### Table of Contents



June 30, 2009
    
    
    December 31, 2008Raw material
    
    $
    1,335,643
    
    
    $
    1,600,001Work-in-process
    
    
    1,511,327
    
    
    
    1,628,664Finished goods
    
    
    1,817,926
    
    
    
    2,399,9674,664,896
    
    
    
    5,628,632Valuation reserves
    
    
    (578,000
    )
    
    
    (580,000
    )$
    4,086,896
    
    
    $
    5,048,632
 7




---



##### Table of Contents



AssemblyFastener
    
    
    Equipment
    
    
    Other
    
    
    ConsolidatedThree Months Ended June 30, 2009:Net sales
    
    $
    4,105,171
    
    
    $
    574,652
    
    
    
    
    
    
    $
    4,679,823Depreciation
    
    
    217,670
    
    
    
    16,458
    
    
    
    19,386
    
    
    
    253,514Segment profit (loss)
    
    
    (195,673
    )
    
    
    116
    
    
    
    
    
    
    
    (195,557
    )Selling and administrative expenses
    
    
    
    
    
    
    
    
    
    
    (498,703
    )
    
    
    (498,703
    )Interest income
    
    
    
    
    
    
    
    
    
    
    25,802
    
    
    
    25,802Loss before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (668,458
    )Capital expenditures
    
    
    47,372
    
    
    
    
    
    
    
    
    
    
    
    47,372Segment assets:Accounts receivable, net
    
    
    2,652,912
    
    
    
    263,736
    
    
    
    
    
    
    
    2,916,648Inventories
    
    
    2,954,378
    
    
    
    1,132,518
    
    
    
    
    
    
    
    4,086,896Property, plant and equipment, net
    
    
    6,259,648
    
    
    
    1,029,506
    
    
    
    716,035
    
    
    
    8,005,189Other assets
    
    
    
    
    
    
    
    
    
    
    9,064,829
    
    
    
    9,064,82924,073,562Three Months Ended June 30, 2008:Net sales
    
    $
    7,039,556
    
    
    $
    1,007,456
    
    
    
    
    
    
    $
    8,047,012Depreciation
    
    
    227,970
    
    
    
    18,522
    
    
    
    21,441
    
    
    
    267,933Segment profit
    
    
    269,516
    
    
    
    171,612
    
    
    
    
    
    
    
    441,128Selling and administrative expenses
    
    
    
    
    
    
    
    
    
    
    (527,465
    )
    
    
    (527,465
    )Interest income
    
    
    
    
    
    
    
    
    
    
    53,925
    
    
    
    53,925Loss before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (32,412
    )Capital expenditures
    
    
    53,020
    
    
    
    
    
    
    
    
    
    
    
    53,020Segment assets:Accounts receivable, net
    
    
    4,556,884
    
    
    
    519,145
    
    
    
    
    
    
    
    5,076,029Inventories
    
    
    4,102,430
    
    
    
    1,387,183
    
    
    
    
    
    
    
    5,489,613Property, plant and equipment, net
    
    
    6,861,157
    
    
    
    1,084,905
    
    
    
    806,377
    
    
    
    8,752,439Other assets
    
    
    
    
    
    
    
    
    
    
    8,063,083
    
    
    
    8,063,08327,381,164
 8




---



##### Table of Contents



AssemblyFastener
    
    
    Equipment
    
    
    Other
    
    
    ConsolidatedSix Months Ended June 30, 2009:Net sales
    
    $
    7,734,601
    
    
    $
    1,704,512
    
    
    
    
    
    
    $
    9,439,113Depreciation
    
    
    431,973
    
    
    
    32,916
    
    
    
    38,772
    
    
    
    503,661Segment profit (loss)
    
    
    (813,651
    )
    
    
    145,295
    
    
    
    
    
    
    
    (668,356
    )Selling and administrative expenses
    
    
    
    
    
    
    
    
    
    
    (1,029,768
    )
    
    
    (1,029,768
    )Interest income
    
    
    
    
    
    
    
    
    
    
    75,806
    
    
    
    75,806Loss before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,622,318
    )Capital expenditures
    
    
    117,464
    
    
    
    
    
    
    
    
    
    
    
    117,464Six Months Ended June 30, 2008:Net sales
    
    $
    14,365,683
    
    
    $
    2,095,655
    
    
    
    
    
    
    $
    16,461,338Depreciation
    
    
    454,620
    
    
    
    37,044
    
    
    
    42,882
    
    
    
    534,546Segment profit
    
    
    596,394
    
    
    
    373,717
    
    
    
    
    
    
    
    970,111Selling and administrative expenses
    
    
    
    
    
    
    
    
    
    
    (1,088,707
    )
    
    
    (1,088,707
    )Interest income
    
    
    
    
    
    
    
    
    
    
    129,847
    
    
    
    129,847Income before income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,251Capital expenditures
    
    
    184,399
    
    
    
    
    
    
    
    
    
    
    
    184,399
 9




---



##### Table of Contents



10




---



##### Table of Contents



This discussion contains certain forward-looking statements which are inherently subject to risks
and uncertainties that may cause actual events to differ materially from those discussed herein.
Factors which may cause such differences in events include, those disclosed under Risk Factors in
our Annual Report on Form 10-K and in the other filings we make with the United States Securities
and Exchange Commission. These factors, include among other things: conditions in the domestic
automotive industry, upon which we rely for sales revenue, the intense competition in our markets,
the concentration of our sales to two major customers, the price and availability of raw materials,
labor relations issues, losses related to product liability, warranty and recall claims, costs
relating to environmental laws and regulations, the loss of the services of our key employees and
difficulties in achieving expected cost savings. Many of these factors are beyond our ability to
control or predict. Readers are cautioned not to place undue reliance on these forward-looking
statements. We undertake no obligation to publish revised forward-looking statements to reflect
events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
 11




---



##### Table of Contents



12




---



##### Table of Contents



NAME
    
    VOTES FOR
    
    VOTES WITHHELDMichael J. Bourg
    
    
    786,818
    
    
    
    174,693Edward L. Chott
    
    
    746,477
    
    
    
    194,960Kent H. Cooney
    
    
    746,945
    
    
    
    194,612William T. Divane, Jr.
    
    
    789,449
    
    
    
    173,625George P. Lynch
    
    
    746,477
    
    
    
    194,960John R. Madden
    
    
    747,106
    
    
    
    194,513John A. Morrissey
    
    
    789,132
    
    
    
    173,825Walter W. Morrissey
    
    
    789,132
    
    
    
    173,825
  31
    
    Rule 13a-14(a) or 15d-14(a) Certifications31.1
    
    Certification Pursuant to Rule 13a-14(a) or 15d-14(a), as Adopted
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification Pursuant to Rule 13a-14(a) or 15d-14(a), as Adopted
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32
    
    Section 1350 Certifications32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 13




---



##### Table of Contents



CHICAGO RIVET & MACHINE CO.
                  (Registrant)Date: August 11, 2009
    /s/  John A. MorrisseyJohn A. MorrisseyChairman of the Board of Directors
and Chief 
     Executive Officer
     (Principal Executive Officer)Date:  August 11, 2009
    /s/ Michael J. BourgMichael J. BourgPresident, Chief Operating
Officer and Treasurer
     (Principal Financial Officer) 14




---



##### Table of Contents



ExhibitNumber
    
    
    
    Page31
    
    Rule 13a-14(a) or 15d-14(a) Certifications31.1
    
    Certification Pursuant to Rule 13a-14(a) or 15d-14(a), as
Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
    
    
    1631.2
    
    Certification Pursuant to Rule 13a-14(a) or 15d-14(a), as
Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
    
    
    1732
    
    Section 1350 Certifications32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    
    
    1832.2
    
    Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    
    
    19
 15