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SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Quarter ended September 30, 2005
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number 0-23585
 
 SM&A
 (Exact name of registrant as specified in its charter)
 California
    
    33-0080929(State or other jurisdiction of
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 4695 MacArthur Court, 8th Floor, Newport Beach, California 92660
 (949) 975-1550
 þ o
 þ o
 o þ
  Class
    
    Outstanding at September 30, 2005Common stock, no par value
    
    20,409,668 shares




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SM&A
 INDEX
 PagePART I. FINANCIAL INFORMATIONCautionary Statement Related to Forward Looking Statements
    
    
    3How to Obtain SM&A SEC Filings
    
    
    3Item 1.
    
    Financial Statements:Consolidated Balance Sheets as of September 30, 2005 (unaudited) and December 31, 2004
    
    
    4Consolidated Statements of Income for the three and nine months ended September 30, 2005 and 2004 (unaudited)
    
    
    5Consolidated Statements of Cash Flows for the nine months ended September 30, 2005 and 2004 (unaudited)
    
    
    6Notes to Consolidated Financial Statements (unaudited)
    
    
    7Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    12Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    20Item 4.
    
    Controls and Procedures
    
    
    20PART II. OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    21Item 2.
    
    Changes in Securities, Use of Proceeds and Issuer Purchase of Equity Securities
    
    
    21Item 3.
    
    Defaults Upon Senior Securities
    
    
    22Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    22Item 5.
    
    Other Information
    
    
    22Item 6.
    
    Exhibits
    
    
    23Signatures
    
    
    26EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2
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CAUTIONARY STATEMENT RELATED TO FORWARD LOOKING STATEMENTS
 This Quarterly Report on Form 10-Q includes certain forward-looking statements as defined
within Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended, relating to revenue, revenue composition, earnings, projected
plans, performance, contract procurement, demand trends, future expense levels, trends in average
headcount and gross margins, and the level of expected capital expenditures. Such forward-looking
statements are based on the beliefs of, estimates made by, and information currently available to
SM&A management and are subject to certain risks, uncertainties and assumptions. Any statements
contained herein (including without limitation statements to the effect that the Company or
management estimates, expects, anticipates, plans, believes, projects, continues,
may, will, could, or would or statements concerning potential or opportunity or
variations thereof or comparable terminology or the negative thereof) that are not statements of
historical fact should be construed as forward-looking statements. The actual results of SM&A may
vary materially from those expected or anticipated in these forward-looking statements. The
realization of such forward-looking statements may be impacted by certain important unanticipated
factors including those discussed in Risk Factors under Item 2, and Managements Discussion and
Analysis of Financial Condition and Results of Operations, at pages 12-18. Because of these and
other factors that may effect SM&As operating results, past performance should not be considered
as an indicator of future performance, and investors should not use historical results to
anticipate results or trends in future periods. The Company undertakes no obligation to publicly
release the results of any revisions to these forward-looking statements that may be made to
reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated
events. Readers should carefully review the risk factors described in this and other documents that
SM&A files from time to time with the Securities and Exchange Commission (SEC), including
subsequent Current Reports on Form 8-K , Quarterly Reports on Form 10-Q and Annual Reports on Form
10-K.
 
 HOW TO OBTAIN SM&A SEC FILINGS
 All reports filed by SM&A with the SEC are available free of charge via EDGAR through the
SEC website at www.sec.gov. In addition, the public may read and copy materials filed by the
Company with the SEC at the SECs public reference room located at 450 Fifth St., N.W., Washington,
D.C. 20549. SM&A also provides copies of its Forms 8-K, 10-K, 10-Q, Proxy and Annual Report at no
charge to investors upon request and makes electronic copies of its most recently filed reports
available through its website at www.smawins.com as soon as reasonably practicable after filing
such material with the SEC.
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SM&A
 
 CONSOLIDATED BALANCE SHEETS
 (in thousands)
 September 30,
    
    
    December 31,2005
    
    
    2004(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    27,413
    
    
    $
    22,148Accounts receivable, net
    
    
    15,473
    
    
    
    13,198Prepaid expenses and other current assets
    
    
    758
    
    
    
    252Deferred income taxes
    
    
    356
    
    
    
    539Total current assets
    
    
    44,000
    
    
    
    36,137Fixed assets, net
    
    
    2,331
    
    
    
    1,037Other assets
    
    
    170
    
    
    
    209$
    46,501
    
    
    $
    37,383LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    892
    
    
    $
    1,192Accrued compensation and related
benefits
    
    
    3,847
    
    
    
    1,793Income taxes payable
    
    
    439
    
    
    
    565Net liabilities of discontinued
operations
    
    
    422
    
    
    
    727Total current liabilities
    
    
    5,600
    
    
    
    4,277Deferred income taxes
    
    
    442
    
    
    
    242Other liabilities
    
    
    531
    
    
    
    173Total liabilities
    
    
    6,573
    
    
    
    4,692Commitments and contingencies
    
    
    
    
    
    
    Shareholders equity:Preferred stock
    
    
    
    
    
    
    Common stock
    
    
    50,387
    
    
    
    50,781Accumulated deficit
    
    
    (10,459
    )
    
    
    (18,090
    )Total shareholders equity
    
    
    39,928
    
    
    
    32,691$
    46,501
    
    
    $
    37,383
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SM&A
 
 CONSOLIDATED STATEMENTS OF INCOME
 (in thousands, except per share data)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004(Unaudited)
    
    
    (Unaudited)
    
    
    (Unaudited)
    
    
    (Unaudited)Revenue
    
    $
    19,678
    
    
    $
    16,078
    
    
    $
    60,184
    
    
    $
    50,724Cost of revenue
    
    
    11,471
    
    
    
    9,003
    
    
    
    34,577
    
    
    
    27,817Gross margin
    
    
    8,207
    
    
    
    7,075
    
    
    
    25,607
    
    
    
    22,907Selling, general and administrative expenses
    
    
    4,438
    
    
    
    4,359
    
    
    
    14,017
    
    
    
    11,937Operating income
    
    
    3,769
    
    
    
    2,716
    
    
    
    11,590
    
    
    
    10,970Interest income, net
    
    
    158
    
    
    
    39
    
    
    
    361
    
    
    
    117Income before income taxes
    
    
    3,927
    
    
    
    2,755
    
    
    
    11,951
    
    
    
    11,087Income tax expense
    
    
    1,369
    
    
    
    1,088
    
    
    
    4,320
    
    
    
    4,197Net income
    
    $
    2,558
    
    
    $
    1,667
    
    
    $
    7,631
    
    
    $
    6,890Net income per share:Basic
    
    $
    0.13
    
    
    $
    0.08
    
    
    $
    0.37
    
    
    $
    0.34Diluted
    
    $
    0.12
    
    
    $
    0.08
    
    
    $
    0.36
    
    
    $
    0.32Shares used in calculating net income per
share:Basic
    
    
    20,432
    
    
    
    20,512
    
    
    
    20,356
    
    
    
    20,484Diluted
    
    
    20,870
    
    
    
    21,492
    
    
    
    20,942
    
    
    
    21,638
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SM&A
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (in thousands)
 Nine Months EndedSeptember 30,2005
    
    
    2004(unaudited)
    
    
    (unaudited)CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    7,631
    
    
    $
    6,890Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation
    
    
    449
    
    
    
    297Deferred income taxes
    
    
    383
    
    
    
    Income tax effect from exercise of stock options
    
    
    1,643
    
    
    
    73Changes in operating assets and liabilities:Accounts receivable
    
    
    (2,275
    )
    
    
    (3,797
    )Prepaid expense and other assets
    
    
    (467
    )
    
    
    (128
    )Accounts payable
    
    
    (300
    )
    
    
    (91
    )Accrued compensation and related benefits
    
    
    2,054
    
    
    
    (534
    )Income taxes payable
    
    
    (126
    )
    
    
    (542
    )Other liabilities
    
    
    358
    
    
    
    (23
    )Net cash provided by operating activities
    
    
    9,350
    
    
    
    2,145CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of fixed assets
    
    
    (1,743
    )
    
    
    (397
    )Net cash used in investing activities
    
    
    (1,743
    )
    
    
    (397
    )CASH FLOWS FROM FINANCING ACTIVITIES:Repurchase of common stock
    
    
    (3,675
    )
    
    
    (2,485
    )Proceeds from issuance of common stock
    
    
    1,638
    
    
    
    1,621Net cash used in financing activities
    
    
    (2,037
    )
    
    
    (864
    )Net increase in cash from continuing operations
    
    
    5,570
    
    
    
    884Net cash used in discontinued operations
    
    
    (305
    )
    
    
    (457
    )Net increase in cash
    
    
    5,265
    
    
    
    427Cash at beginning of period
    
    
    22,148
    
    
    
    17,712Cash at end of period
    
    $
    27,413
    
    
    $
    18,139
  6




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SM&A
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 For the Three and Nine months Ended September 30, 2005 and 2004
 (unaudited)
 Note 1. Basis of Presentation and Significant Accounting Policies
    Recent Accounting Pronouncements
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Note 1. Basis of Presentation and Significant Accounting Policies  (contd)
  Significant Accounting Policies
 Revenue Recognition.
 Cash and Cash Equivalents.
 Note 2. Net Income Per Share
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004Denominator
for basic income per share: weighted average shares outstanding
during the period
    
    
    20,432
    
    
    
    20,512
    
    
    
    20,356
    
    
    
    20,484Incremental shares attributable to dilutive
outstanding stock options
    
    
    438
    
    
    
    980
    
    
    
    586
    
    
    
    1,154Denominator for diluted income per share:
    
    
    20,870
    
    
    
    21,492
    
    
    
    20,942
    
    
    
    21,638
 Note 3. Stock-Based Compensation
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Note 3. Stock-Based Compensation  (Contd)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2004
    
    
    2005
    
    
    2004Net income  as reported
    
    $
    2,558
    
    
    $
    1,667
    
    
    $
    7,631
    
    
    $
    6,890Less: stock compensation expense  net of tax
    
    
    (177
    )
    
    
    (250
    )
    
    
    (1,668
    )
    
    
    (820
    )Net income  SFAS No. 123 pro forma
    
    $
    2,381
    
    
    $
    1,417
    
    
    $
    5,963
    
    
    $
    6,070Basic income per share  as reported
    
    $
    0.13
    
    
    $
    0.08
    
    
    $
    0.37
    
    
    $
    0.34Basic income per share  SFAS No. 123 pro
forma
    
    $
    0.12
    
    
    $
    0.07
    
    
    $
    0.29
    
    
    $
    0.30Diluted income per share  as reported
    
    $
    0.12
    
    
    $
    0.08
    
    
    $
    0.36
    
    
    $
    0.32Diluted income per share  SFAS No. 123 pro
forma
    
    $
    0.11
    
    
    $
    0.07
    
    
    $
    0.28
    
    
    $
    0.28
    Note 4. Revolving Line of Credit
 th
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Note 4. Revolving Line of Credit  (contd)
  Note 5. Income Taxes
   Note 6. Stockholders Equity
  Note 7. Related Parties
   10




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Note 7. Related Parties  (contd)
  Note 8. Discontinued Operations
  11




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  RESULTS OF OPERATIONS
  For the Three Months Ended September 30,2005
    
    
    2004
    
    
    Change
    
    
    Change %Revenue
    
    $
    19,678
    
    
    $
    16,078
    
    
    $
    3,600
    
    
    
    22Cost of revenue
    
    
    11,471
    
    
    
    9,003
    
    
    
    2,468
    
    
    
    27Gross margin
    
    
    8,207
    
    
    
    7,075
    
    
    
    1,132
    
    
    
    16Selling, general and administrative expenses
    
    
    4,438
    
    
    
    4,359
    
    
    
    79
    
    
    
    2Operating income
    
    
    3,769
    
    
    
    2,716
    
    
    
    1,053
    
    
    
    39Income tax expense
    
    
    1,369
    
    
    
    1,088
    
    
    
    281
    
    
    
    26Net income
    
    $
    2,558
    
    
    $
    1,667
    
    
    $
    891
    
    
    
    53
 Three Months Ended September 30, 2005 Compared to Three Months Ended September 30, 2004
 Revenue.
  Gross Margin.
 Selling, General and Administrative Expenses.
 12




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Item 2.
Managements Discussion and Analysis of Financial Condition and Results of Operations 
(contd)
  Operating Income.
 Income Tax Expense
 13




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Item 2.
Managements Discussion and Analysis of Financial Condition and Results of Operations 
(contd)
 RESULTS OF OPERATIONS
  For the Nine Months Ended September 30,2005
    
    
    2004
    
    
    Change
    
    
    Change %Revenue
    
    $
    60,184
    
    
    $
    50,724
    
    
    $
    9,460
    
    
    
    19Cost of revenue
    
    
    34,577
    
    
    
    27,817
    
    
    
    6,760
    
    
    
    24Gross margin
    
    
    25,607
    
    
    
    22,907
    
    
    
    2,700
    
    
    
    12Selling, general and administrative expenses
    
    
    14,017
    
    
    
    11,937
    
    
    
    2,080
    
    
    
    17Operating income
    
    
    11,590
    
    
    
    10,970
    
    
    
    620
    
    
    
    6Income tax expense
    
    
    4,320
    
    
    
    4,197
    
    
    
    123
    
    
    
    3Net income
    
    $
    7,631
    
    
    $
    6,890
    
    
    $
    741
    
    
    
    11
 Nine months Ended September 30, 2005 Compared to Nine months Ended September 30, 2004
 Revenue.
  Gross Margin.
 Selling, General and Administrative Expenses.
 14




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Item 2.
Managements Discussion and Analysis of Financial Condition and Results of Operations 
(contd)
  Operating Income.
 Income Tax Expense September 30, 2005,
  15




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Item 2.
Managements Discussion and Analysis of Financial Condition and Results of Operations 
(contd)
 Capital Resources and Liquidity
     th September 30, 2005,
  16




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Item 2.
Managements Discussion and Analysis of Financial Condition and
Results of Operations 
(contd)
 RISK FACTORS
 In addition to the other information in this Quarterly Report on Form 10-Q, the following factors
should be considered carefully in evaluating our business and prospects.
 Our business depends substantially on the defense industry.
  
    
    Loss of political support for current or increased levels of spending;
    
    Changes of presidential administration, particularly changes from one political
party to another, that typically result in a mass reordering of priorities that reduce
new proposal activity for up to a year;
    
    Threat scenarios evolving away from global conflicts to regional conflicts;
    
    Spending for ongoing operations, such as the war on terrorism, the occupation of
Iraq, downward pressure on spending for procurement of new systems and research and
development spending; and
    
    Cancellation of programs or emphasis on government shifting programs.
  We rely on a relatively limited number of clients.
  The markets in which we operate are highly competitive.
  We rely heavily upon our key senior management personnel and our ability to recruit and maintain
skilled professionals.
  17




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Item 2.
Managements Discussion and Analysis of Financial Condition and Results of Operations 
(contd)
  Quarterly results may fluctuate.
  Our stock price is subject to significant volatility.
  
    
    Quarterly fluctuations in results of operations;
    
    Adverse circumstances affecting the introduction, or market acceptance of new services we offer;
    
    Announcements of new services by competitors;
    
    Announcements of poor operating results by us or our competitors;
    
    Loss of key employees;
    
    Changes in the regulatory environment or market conditions affecting the defense and
aerospace industry;
    
    Changes in earnings estimates and ratings by analysts;
    
    Lack of market liquidity resulting from a relatively small amount of public stock float;
    
    Changes in generally accepted accounting principles;
    
    Sales of common stock by existing holders; and
    
    The announcement of proposed acquisitions and dispositions.
 We cannot guarantee that future acquisitions, mergers or investments in other companies will be
successful.
  
    
    the diversion of our managements attention from our existing business while
evaluating acquisitions, investments and other prospective business combinations and
thereafter while assimilating the operations and personnel of the new business;
    
    adverse short-term effects on our operating results;
    
    the inability to successfully and rapidly integrate the new businesses, personnel
and products with our existing business, including financial reporting, management
and information technology systems;
    
    higher than anticipated costs of integration;
    
    unforeseen operating difficulties and expenditures;
    
    the need to manage a significantly larger business;
 18




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
    
    potential dilution to our shareholders to the extent we use our common stock as
currency for an acquisition;
    
    the assumption of liabilities;
    
    the use of a substantial amount of our available cash to consummate an acquisition;
    
    difficulties inherent in the implementation and application of the provisions of
the Sarbanes-Oxley Act of 2002 to the operations of a privately-held entity acquired
by the Company; and
    
    loss of employees of an acquired business, including employees who may have been
instrumental to the success or growth of that business.
  Principal shareholder has significant control.
  19




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Item 3. Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
   Changes in Internal Controls
  20




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PART
II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Changes in Securities and Use of Proceeds and Issuer Purchase of Equity Securities
 Issuer Purchases of Equity Securities
 Total Number of
    
    
    
    
    
    
    Approximate $ Value ofShares Purchased as
    
    
    
    
    
    
    Shares That May Yet BeTotal Number of
    
    
    
    
    
    
    Average Price Paid
    
    
    Part of a Publicly
    
    
    
    
    
    
    Purchased Under thePeriod
    
    Shares Purchased
    
    
    
    
    
    
    per Share
    
    
    Announced Plan
    
    
    
    
    
    
    PlanBeginning balance
    
    
    625,500
    
    
    
    
    
    
    $
    7.39
    
    
    
    625,500
    
    
    
    
    
    
    $
    2,377,000January 1, 2005 to
January 31, 2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,377,000February 1, 2005 to
February 28, 2005
    
    
    45,180
    
    
    
    
    
    
    
    8.03
    
    
    
    670,680
    
    
    
    
    
    
    
    2,014,000March 1, 2005 to
March 31, 2005
    
    
    27,990
    
    
    
    
    
    
    
    7.88
    
    
    
    698,670
    
    
    
    
    
    
    
    1,794,000April 1, 2005 to
April 30, 2005
    
    
    351,825
    
    
    
    
    
    
    
    8.24
    
    
    
    1,050,495
    
    
    
    
    
    
    
    3,896,000May 1, 2005 to
May 31, 2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,896,000June 1, 2005 to
June 30, 2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,896,000July 1, 2005 to
July 31, 2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,896,000August 1, 2005 to
August 30, 2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,896,000September 1, 2005
to September
30, 2005
    
    
    22,000
    
    
    
    
    
    
    
    8.84
    
    
    
    1,072,495
    
    
    
    
    
    
    
    3,702,000Total
    
    
    1,072,495
    
    
    
    
    
    
    $
    7.74
    
    
    
    1,072,495
  21




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Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
      22




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Item 5.
Other Information  (contd)
  
 Item 6. Exhibits
 INDEX TO EXHIBITS
  2.1
    
    Stock Purchase and Sale Agreement, by and among the Registrant, Steven Myers Holding Inc.
and L-3 Communications Corporation. (1)2.2
    
    Amendment No. 1 to Stock Purchase and Sale Agreement, by and among the Registrant, Steven
Myers Holding Inc. and L-3 Communications Corporation. (2)3.1
    
    Amended and Restated Articles of Incorporation. (3)3.2
    
    Amended and Restated Bylaws of the Registrant. (4)10.1
    
    Amended and Restated 1997 Stock Option Plan and related form of Stock Option Agreement. (5)10.2
    
    Amended and Restated Employee Stock Purchase Plan. (6)10.3
    
    Office Facility Lease. (7)10.4
    
    Amendment No. 1 to Office Facility Lease. (8)10.5
    
    Employment Agreement of Steven S. Myers. (9)10.6
    
    Amendment No. 1 to Employment Agreement of Steven S. Myers. (10)10.7
    
    Amendment No. 2 to Employment Agreement of Steven S. Myers. (11)10.8
    
    Amendment No. 3 to Employment Agreement of Steven S. Myers. (12)10.9
    
    Amendment No. 4 to Employment Agreement of Steven S. Myers. (13)10.10
    
    Amendment No. 5 to Employment Agreement of Steven S. Myers. (14)10.11
    
    Employment Agreement of Cathy L. Wood McCarthy. (15)10.12
    
    Amendment No. 1 to Employment Agreement of Cathy L. Wood McCarthy.(16)10.13
    
    Amendment No. 2 to Employment Agreement of Cathy L. Wood McCarthy. (17)10.14
    
    Amendment No. 3 to Employment Agreement of Cathy L. Wood McCarthy. (18)10.15
    
    Amendment No. 4 to Employment Agreement of Cathy L. Wood McCarthy. (19)10.16
    
    Employment Agreement of Bennett C. Beaudry. (20)10.17
    
    Amendment No. 1 to Employment Agreement of Bennett C. Beaudry. (21)
 23




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10.18
    
    Amendment No. 2 to Employment Agreement of Bennett C. Beaudry. (22)10.19
    
    Amendment No. 3 to Employment Agreement of Bennett C. Beaudry. (23)10.20
    
    Accounts Receivable Loan Agreement dated January 10, 2002, by and between the Registrant
and City National Bank, a national banking association. (24)10.21
    
    Commercial Guaranty dated January 10, 2002, executed by Steven Myers & Associates, Inc.
in favor of City National Bank, a national banking association. (25)10.22
    
    Revolving Loan Agreement dated October 14, 2003, by and between the registrant and City
National Bank, a national
association.
(26)10.23
    
    Revolving Note dated April 10, 2003, executed by SM&A, in favor of City National Bank.
(27)10.24
    
    Renewal of Revolving Note dated April 27, 2004, executed by SM&A, in favor of City National
Bank. (28)10.25
    
    Renewal of Revolving Note dated April 29, 2005, executed by SM&A, in favor of City National
Bank. (29)10.26
    
    Consultant Agreement of Bowes Enterprises. (30)10.27
    
    Consultant Agreement of Joseph B. Reagan. (31)21.1
    
    Subsidiaries of the Registrant. (32)31.1
    
    Certificate of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002. (33)31.2
    
    Certificate of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002. (34)32.1
    
    Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (35)32.2
    
    Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (36)
 Footnote #
 
 (1)
    
    Filed on November 27, 2001 as Exhibit 10.1 to the registrants Current Report on Form 8-K and
incorporated herein by reference.(2)
    
    Filed on December 14, 2001 as Exhibit 10.1 to the registrants Current Report on Form 8-K
and incorporated herein by reference.(3)
    
    Filed on March 15, 2002 as Exhibit 3.1 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(4)
    
    Filed on May 3, 2002 as Exhibit 3.2 to the registrants Quarterly Report on Form 10-Q and
incorporated herein by reference.(5)
    
    Filed on April 17, 2001 as Exhibit 10.1 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(6)
    
    Filed on April 29, 2002 as Exhibit C to the registrants Annual Proxy Statement on Form 14A
and incorporated herein by reference.(7)
    
    Filed on November 21, 1997 as Exhibit 10.3 to the registrants Registration Statement
333-4075 on Form S-1 (Registration
No. 333-4075) and incorporated herein by reference.(8)
    
    Filed on October 22, 2004 as Exhibit 10.25 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(9)
    
    Filed on April 17, 2001 as Exhibit 10.17 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(10)
    
    Filed on March 15, 2002 as Exhibit 10.7 to the
registrants Annual Report on Form 10-K and incorporated herein by reference.(11)
    
    Filed on May 3, 2002 as Exhibit 10.8 to the registrants Quarterly Report on Form 10-Q and
incorporated herein by reference.(11)
    
    Filed on March 11, 2003 as Exhibit 10.7 to the registrants Annual Report on Form 10-K
and incorporated herein by reference.(13)
    
    Filed on February 6, 2004 as Exhibit 10.8 to the registrants Annual Report on Form 10-K
and incorporated herein by reference. 24




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(14)
    
    Filed on October 22, 2004 as Exhibit 10.21 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(15)
    
    Filed on March 15, 2002 as Exhibit 10.8 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(16)
    
    Filed on November 4, 2002 as Exhibit 10.10 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(17)
    
    Filed on March 11, 2003 as Exhibit 10.10 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(18)
    
    Filed on February 6, 2004 as Exhibit 10.12 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(19)
    
    Filed on October 22, 2004 as Exhibit 10.22 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(20)
    
    Filed on November 4, 2002 as Exhibit 10.11 to the registrants Quarterly Report on
Form 10-Q and incorporated herein by reference.(21)
    
    Filed on March 11, 2003 as Exhibit 10.12 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(22)
    
    Filed on February 6, 2004 as Exhibit 10.15 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(23)
    
    Filed on October 8, 2004 as Exhibit 99.1 to the registrants current report on 8-K and
incorporated herein by reference.(24)
    
    Filed on January 25, 2002 as Exhibit 99.2 to the registrants Current Report on Form 8-K
and incorporated herein by reference.(25)
    
    Filed on January 25, 2002 as Exhibit 99.3 to the registrants Current Report on Form 8-K
and incorporated herein by reference.(26)
    
    Filed on February 6, 2004 as Exhibit 10.18 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(27)
    
    Filed on July 31, 2003 as Exhibit 10.16 to the registrants Quarterly Report on Form 10-Q
and incorporated herein by reference.(28)
    
    Filed on July 21, 2004 as Exhibit 10.20 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(29)
    
    Filed on July 14, 2005 as Exhibit 10.25 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(30)
    
    Filed on October 22, 2004 as Exhibit 10.23 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(31)
    
    Filed on October 22, 2004 as Exhibit 10.24 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(32)
    
    Filed on March 11, 2003 as Exhibit 21.1 to the registrants Annual Report on Form 10-K
and incorporated herein by reference.(33)
    
    Filed herewith.(34)
    
    Filed herewith.(35)
    
    Filed herewith.(36)
    
    Filed herewith. 25




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SIGNATURE
  SM&ABy:
    
    /s/ CATHY L. MCCARTHYDated: October 18, 2005
    
    
    
    Cathy L. McCarthyExecutive Vice President, Chief Financial Officer and SecretaryBy:
    
    /s/ STEVEN S. MYERSDated: October 18, 2005
    
    
    
    Steven S. MyersChairman and Chief Executive Officer
 26




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EXHIBIT INDEX
 EXHIBIT NO.
    
    DESCRIPTION2.1
    
    Stock Purchase and Sale Agreement, by and among the Registrant, Steven Myers Holding Inc.
and L-3 Communications Corporation. (1)2.2
    
    Amendment No. 1 to Stock Purchase and Sale Agreement, by and among the Registrant, Steven
Myers Holding Inc. and L-3 Communications Corporation. (2)3.1
    
    Amended and Restated Articles of Incorporation. (3)3.2
    
    Amended and Restated Bylaws of the Registrant. (4)10.1
    
    Amended and Restated 1997 Stock Option Plan and related form of Stock Option Agreement. (5)10.2
    
    Amended and Restated Employee Stock Purchase Plan. (6)10.3
    
    Office Facility Lease. (7)10.4
    
    Amendment No. 1 to Office Facility Lease. (8)10.5
    
    Employment Agreement of Steven S. Myers. (9)10.6
    
    Amendment No. 1 to Employment Agreement of Steven S. Myers. (10)10.7
    
    Amendment No. 2 to Employment Agreement of Steven S. Myers. (11)10.8
    
    Amendment No. 3 to Employment Agreement of Steven S. Myers. (12)10.9
    
    Amendment No. 4 to Employment Agreement of Steven S. Myers. (13)10.10
    
    Amendment No. 5 to Employment Agreement of Steven S. Myers. (14)10.11
    
    Employment Agreement of Cathy L. Wood McCarthy. (15)10.12
    
    Amendment No. 1 to Employment Agreement of Cathy L. Wood McCarthy.(16)10.13
    
    Amendment No. 2 to Employment Agreement of Cathy L. Wood McCarthy. (17)10.14
    
    Amendment No. 3 to Employment Agreement of Cathy L. Wood McCarthy. (18)10.15
    
    Amendment No. 4 to Employment Agreement of Cathy L. Wood McCarthy. (19)10.16
    
    Employment Agreement of Bennett C. Beaudry. (20)10.17
    
    Amendment No. 1 to Employment Agreement of Bennett C. Beaudry. (21)




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EXHIBIT NO.
    
    DESCRIPTION10.18
    
    Amendment No. 2 to Employment Agreement of Bennett C. Beaudry. (22)10.19
    
    Amendment No. 3 to Employment Agreement of Bennett C. Beaudry. (23)10.20
    
    Accounts Receivable Loan Agreement dated January 10, 2002, by and between the Registrant
and City National Bank, a national banking association. (24)10.21
    
    Commercial Guaranty dated January 10, 2002, executed by Steven Myers & Associates, Inc.
in favor of City National Bank, a national banking association. (25)10.22
    
    Revolving Loan Agreement dated October 14, 2003, by and between the registrant and City
National Bank, a national association. (26)10.23
    
    Revolving Note dated April 10, 2003, executed by SM&A, in favor of City National Bank.
(27)10.24
    
    Renewal of Revolving Note dated April 27, 2004, executed by SM&A, in favor of City National
Bank. (28)10.25
    
    Renewal of Revolving Note dated April 29, 2005, executed by SM&A, in favor of City National
Bank. (29)10.26
    
    Consultant Agreement of Bowes Enterprises. (30)10.27
    
    Consultant Agreement of Joseph B. Reagan. (31)21.1
    
    Subsidiaries of the Registrant. (32)31.1
    
    Certificate of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002. (33)31.2
    
    Certificate of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002. (34)32.1
    
    Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (35)32.2
    
    Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (36)
 Footnote
#
 
 (1)
    
    Filed on November 27, 2001 as Exhibit 10.1 to the registrants Current Report on Form 8-K and
incorporated herein by reference.(2)
    
    Filed on December 14, 2001 as Exhibit 10.1 to the registrants Current Report on Form 8-K
and incorporated herein by reference.(3)
    
    Filed on March 15, 2002 as Exhibit 3.1 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(4)
    
    Filed on May 3, 2002 as Exhibit 3.2 to the registrants Quarterly Report on Form 10-Q and
incorporated herein by reference.(5)
    
    Filed on April 17, 2001 as Exhibit 10.1 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(6)
    
    Filed on April 29, 2002 as Exhibit C to the registrants Annual Proxy Statement on Form 14A
and incorporated herein by reference.(7)
    
    Filed on November 21, 1997 as Exhibit 10.3 to the registrants Registration Statement
333-4075 on Form S-1 (Registration No. 333-4075) and incorporated herein by reference.(8)
    
    Filed on October 22, 2004 as Exhibit 10.25 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(9)
    
    Filed on April 17, 2001 as Exhibit 10.17 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(10)
    
    Filed on March 15, 2002 as Exhibit 10.7 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(11)
    
    Filed on May 3, 2002 as Exhibit 10.8 to the registrants Quarterly Report on Form 10-Q and
incorporated herein by reference.(11)
    
    Filed on March 11, 2003 as Exhibit 10.7 to the registrants Annual Report on Form 10-K
and incorporated herein by reference.(13)
    
    Filed on February 6, 2004 as Exhibit 10.8 to the registrants Annual Report on Form 10-K
and incorporated herein by reference.




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(14)
    
    Filed on October 22, 2004 as Exhibit 10.21 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(15)
    
    Filed on March 15, 2002 as Exhibit 10.8 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(16)
    
    Filed on November 4, 2002 as Exhibit 10.10 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(17)
    
    Filed on March 11, 2003 as Exhibit 10.10 to the registrants Annual Report on Form 10-K and
incorporated herein by reference.(18)
    
    Filed on February 6, 2004 as Exhibit 10.12 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(19)
    
    Filed on October 22, 2004 as Exhibit 10.22 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(20)
    
    Filed on November 4, 2002 as Exhibit 10.11 to the registrants Quarterly Report on
Form 10-Q and incorporated herein by reference.(21)
    
    Filed on March 11, 2003 as Exhibit 10.12 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(22)
    
    Filed on February 6, 2004 as Exhibit 10.15 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(23)
    
    Filed on October 8, 2004 as Exhibit 99.1 to the registrants current report on 8-K and
incorporated herein by reference.(24)
    
    Filed on January 25, 2002 as Exhibit 99.2 to the registrants Current Report on Form 8-K
and incorporated herein by reference.(25)
    
    Filed on January 25, 2002 as Exhibit 99.3 to the registrants Current Report on Form 8-K
and incorporated herein by reference.(26)
    
    Filed on February 6, 2004 as Exhibit 10.18 to the registrants Annual Report on Form
10-K and incorporated herein by reference.(27)
    
    Filed on July 31, 2003 as Exhibit 10.16 to the registrants Quarterly Report on Form 10-Q
and incorporated herein by reference.(28)
    
    Filed on July 21, 2004 as Exhibit 10.20 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(29)
    
    Filed on July 14, 2005 as Exhibit 10.25 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(30)
    
    Filed on October 22, 2004 as Exhibit 10.23 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(31)
    
    Filed on October 22, 2004 as Exhibit 10.24 to the registrants Quarterly Report on Form
10-Q and incorporated herein by reference.(32)
    
    Filed on March 11, 2003 as Exhibit 21.1 to the registrants Annual Report on Form 10-K
and incorporated herein by reference.(33)
    
    Filed herewith.(34)
    
    Filed herewith.(35)
    
    Filed herewith.(36)
    
    Filed herewith.