UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
(X) Quarterly Report Under Section 13 or 15(D) of The Securities Exchange
Act of 1934 For Quarter Ended June 30, 2001
OR
( ) Transition Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
Commission File Number 0-275
Allen Organ Company
(Exact name of registrant as specified in its charter)
Pennsylvania 23-1263194
(State of Incorporation) (I.R.S. Employer Identification No.)
150 Locust Street, P. O. Box 36, Macungie, Pennsylvania 18062-0036
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 610-966-2200
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No_____
Number of shares outstanding of each of the issuer's classes of common
stock, as of August 7, 2001:
Class A - Voting 84,002 shares
Class B - Non-voting 1,086,457 shares
ALLEN ORGAN COMPANY
INDEX
Part I Financial Information
Item 1.Financial Statements
Consolidated Condensed Statements of Income for the three and
six months ended June 30, 2001 and 2000
Consolidated Condensed Balance Sheets at June 30, 2001 and
December 31, 2000
Consolidated Condensed Statements of Cash Flows for the three
and six months ended June 30, 2001 and 2000
Notes to Consolidated Condensed Financial Statements
Item 2.Management's Discussion and Analysis of Financial Condition and
Results of Operations
Item 3.Quantitative and Qualitative Disclosures About Market Risk
Part II Other Information
Item 4.Submission of Matters to a Vote of Security Holders
Item 6.Exhibits and Reports on Form 8-K
Signatures
PART I FINANCIAL INFORMATION
ITEM 1.FINANCIAL STATEMENTS
ALLEN ORGAN COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)
For the 3 Months Ended: For the 6 Months Ended:
6/30/2001 6/30/2000 6/30/2001 6/30/2000
Net Sales $15,119,294 $18,931,735 $28,378,692 $35,739,767
Cost and Expenses
Costs of sales 11,229,132 11,180,040 21,106,679 21,034,444
Selling, general and
administrative 3,921,633 4,186,916 8,221,905 8,443,633
Research and
development 2,158,786 1,777,753 4,355,094 3,464,808
Costs to close
Southampton plant 530,000 -- 530,000 --
Impairment of VIR,
Inc. goodwill -- -- 1,400,000 --
Total Costs and
Expenses 17,839,551 17,144,709 35,613,678 32,942,885
(Loss) Income from
Operations (2,720,257) 1,787,026 (7,234,986) 2,796,882
Other income (expense)
Investment and other
income 355,429 258,267 709,572 525,662
Interest expense (164,055) -- (315,084) --
Minority interests in
consolidated
subsidiaries (83,398) (98) (33,275) 34,503
Total Other Income
and Expense 107,976 258,169 361,213 560,165
(Loss) Income Before
Taxes (2,612,281) 2,045,195 (6,873,773) 3,357,047
Income Tax (Benefit)
Provision (1,047,000) 689,000 (2,683,000) 1,131,000
Net (Loss) Income $(1,565,281) $1,356,195 $(4,190,773) $2,226,047
Basic and Diluted
(Loss) Earnings
Per Share $ (1.34) $ 1.16 $ (3.58) $ 1.90
Weighted Average Shares
Used in Per Share
Calculation 1,170,528 1,170,621 1,170,528 1,170,621
Dividends Per Share
- Cash $ 0.14 $ 0.14 $ 0.28 $ 0.28
Total Comprehensive
(Loss) Income $(1,661,534) $1,234,119 $(4,388,038) $2,203,536
See accompanying notes.
ALLEN ORGAN COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
ASSETS June 30, 2001 Dec 31, 2000
(Unaudited) (Audited)
Current Assets
Cash $1,344,730 $2,712,368
Investments Including Accrued Interest 11,972,980 24,694,377
Accounts Receivable, net of reserves of
$408,508 and $428,791, respectively 8,002,320 10,285,659
Inventories:
Raw Materials 6,579,468 7,684,892
Work in Process 6,098,748 6,172,954
Finished Goods 5,984,675 5,950,327
Total Inventories 18,662,891 19,808,173
Income Taxes Prepaid and Receivable 2,997,715 13,972
Prepaid Expenses 705,082 304,342
Deferred Income Tax Benefits 1,208,800 1,094,701
Total Current Assets 44,894,518 58,913,592
Property, Plant and Equipment 26,852,487 25,861,781
Less Accumulated Depreciation (14,594,796) (13,338,648)
Total Property, Plant and Equipment 12,257,691 12,523,133
Other Assets
Prepaid Pension Costs 537,669 506,702
Inventory Held for Future Service 776,525 690,657
Note Receivable 1,955,779 1,556,721
Cash Value of Life Insurance 2,034,867 2,034,867
Deferred Income Tax Benefits 254,476 398,476
Goodwill, net 2,482,367 4,165,002
Other Assets 18,592 18,592
Total Other Assets 8,060,275 9,371,017
Total Assets $65,212,484 $80,807,742
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities
Notes Payable - Bank $ -- $ 8,700,000
Accounts Payable 1,879,353 3,448,119
Other Accrued Expenses 2,151,951 2,816,102
Customer Deposits 2,992,903 2,991,628
Total Current Liabilities 7,024,207 17,955,849
Noncurrent Liabilities
Deferred and Other Noncurrent Liabilities 379,722 310,016
Total Liabilities 7,403,929 18,265,865
Minority Interests -- 106,976
STOCKHOLDERS' EQUITY
Common Stock 2001 2000
Class A 127,232 shares; 127,232 shares 127,232 127,232
Class B 1,410,761 shares; 1,410,761 shares 1,410,761 1,410,761
Capital in Excess of Par Value 12,854,943 12,758,610
Retained Earnings
Balance, Beginning 59,977,002 56,677,650
Net Income (4,190,773) 3,954,896
Dividends - Cash 2001 and 2000 (327,750) (655,544)
Balance, End 55,458,479 59,977,002
Accumulated Other Comprehensive Income:
Unrealized (Loss) Gain on Investments (57,275) 139,990
Sub-Total 69,794,140 74,413,595
Treasury Stock
2001- 43,230 Class A shares;324,304 Class B shares (11,985,585) --
2000- 43,230 Class A shares;324,148 Class B shares -- (11,978,694)
Total Stockholders' Equity 57,808,555 62,434,901
Total Liabilities and Stockholders' Equity $65,212,484 $80,807,742
See accompanying notes.
ALLEN ORGAN COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
For the 3 Months Ended: For the 6 Months Ended:
6/30/2001 6/30/2000 6/30/2001 6/30/2000
CASH FLOWS FROM OPERATING
ACTIVITIES
Net (loss) income $(1,565,281) $1,356,195 $(4,190,773) $2,226,047
Adjustments to reconcile net
(loss) income to net cash
provided by operating
activities
Depreciation and amortization 806,604 488,639 1,602,416 1,008,810
Loss from impairment of VIR,
Inc. goodwill, included
in operating expenses -- -- 1,400,000 --
Minority interest in
consolidated subsidiaries 83,398 98 33,275 (34,503)
Change in assets and liabilities
Accounts receivable (477,690) (207,973) 2,283,339 2,908,688
Inventories 2,277,673 (987,162) 1,059,414 (2,900,128)
Income taxes prepaid and
receivable (1,502,000) -- (2,983,743) --
Prepaid expenses (10,833) (143,331) (400,740) (223,328)
Prepaid pension costs (2,391) 9,137 (30,967) 52,250
Other assets -- (3,640) -- --
Deferred income tax benefits (14,099) -- 29,901 --
Accounts payable (1,222,676) 83,399 (1,568,766) (334,024)
Accrued taxes on income -- (631,750) -- (344,701)
Accrued expenses 289,367 (159,155) (664,151) 277,632
Customer deposits (17,559) 254,610 1,275 132,677
Deferred and other noncurrent
liabilities 34,853 (31,499) 69,706 1,026
Net Cash (Used In) Provided
by Operating Activities (1,320,634) 24,820 (3,359,814) 2,770,446
CASH FLOW FROM INVESTING
ACTIVITIES
Increase in note receivable -- -- (399,058) (405,612)
Net additions to plant and
equipment (358,263) (684,251) (988,897) (1,600,773)
Additions to goodwill (156,243) (273,624) (156,243) (551,428)
Net sale (or purchase) of
short term investments 12,544,103 (529,303) 12,524,132 1,365,002
Net Cash Provided by (Used
In) Investing Activities 12,029,597 (1,484,430) 10,979,934 (1,192,811)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from bank loans 1,100,000 -- 3,300,000 --
Repayment of bank loans (12,000,000) -- (12,000,000) --
Proceeds from sales of
subsidiary stock -- -- 96,333 --
Subsidiary stock reacquired
from minority shareholders (49,450) -- (49,450) --
Reacquired Class B common
shares (1,156) -- (6,891) (3,732)
Dividends paid in cash (163,864) (163,886) (327,750) (327,773)
Net Cash (Used In) Provided
by Financing Activities (11,114,470) (163,886) (8,987,758) (331,505)
NET (DECREASE) INCREASE IN CASH (405,507) (1,623,496) (1,367,638) 1,246,130
CASH, BEGINNING 1,750,237 3,078,903 2,712,368 209,277
CASH, ENDING $ 1,344,730 $1,455,407 $ 1,344,730 $1,455,407
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION
Cash paid for:
Income Taxes $ 55,000 $1,322,750 $ 242,000 $1,492,500
Interest $ 164,055 $ -- $ 315,084 $ --
See accompanying notes.
ALLEN ORGAN COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. Interim Financial Statements
The results of operations for the interim periods shown in this report
are not necessarily indicative of results to be expected for the fiscal
year. In the opinion of management, the information contained herein
reflects all adjustments necessary to make the results of operations
for the interim periods a fair statement of such operations. All such
adjustments are of a normal recurring nature.
Certain notes and other information have been condensed or omitted from
the interim financial statements presented in the Quarterly Report on
Form 10-Q. Therefore, these financial statements should be read in
conjunction with the Company's 2000 Annual Report on Form 10-K.
2. Impairment of Goodwill
During March 2001 the Company recorded a charge to operating expenses
of $1,400,000 related to the impairment in the value of goodwill which
arose in connection with the acquisition of VIR, Inc. This write down
of goodwill is attributable to the downturn in the data communications
industry, the announced combination of VIR into the Company's
subsidiary Eastern Research, Inc. and closure of the VIR facility
discussed in more detail below, all of which reduced expectations of
future cash flows from VIR's operations.
3. Combination of Subsidiaries
During April 2001 the Company announced plans to combine its Data
Communications subsidiaries VIR Linear Switch (VIR) of Southampton, PA
into Eastern Research, Inc. (ERI), which is also a subsidiary of the
Company. VIR designs, manufactures and markets a number of test access
and tech control products for use in customer networks. The
Southampton, PA facility will be closed later this year. The combined
operations will be headquartered at ERI's facility in Moorestown, New
Jersey. Manufacturing of some of VIR's products will be moved to ERI's
supplier with other manufacturing being transferred to the Macungie, PA
plant. The Company has estimated the restructuring charges (including
employee severance, benefits and other exit costs) related to this
combination and plant closure to be approximately $530,000 which have
been included in the operating results for the second quarter of 2001.
4. Financing
During June 2001 Eastern Research, Inc. repaid all outstanding bank
loans totaling $12,000,000 with funds provided by Allen Organ Company.
The Company originally obtained these loans to give ERI financial
autonomy as it explored strategic alternatives. With the changes in
the financial markets particularly in the technology sector, the
Company decided to repay the outstanding loans to eliminate the costs
related to this financing.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS.
Liquidity and Capital Resources:
Cash flows from operating activities decreased during the three and six
months ended June 30, 2001 when compared to the same period in 2000,
primarily due to operating losses incurred in the Data Communications
segment. These decreases were partially offset by reductions in inventory
levels in the Musical Instruments, Electronic Assemblies and Data
Communications segments.
Cash flows from investing activities were used to purchase property and
equipment during the six months ended June 30, 2001 including approximately
$283,000 in the Musical Instruments segment, 134,000 in the Electronic
Assemblies segment and $560,000 in the Data Communications segment.
During the three months ended June 30, 2001 the Company sold more than
$12,000,000 in short term investments to fund the repayment of bank loans
discussed in Footnote 4 above.
Results of Operations:
Sales and Operating Income
For the 3 Months Ended: For the 6 Months Ended:
6/30/2001 6/30/2000 6/30/2001 6/30/2000
Net Sales to
Unaffiliated Customers
Musical Instruments $ 6,308,664 $ 7,837,715 $12,231,785 $14,509,062
Data Communications 5,209,952 7,772,309 8,809,968 15,830,398
Electronic Assemblies 2,973,696 2,409,061 6,267,056 3,912,916
Audio Equipment 626,982 912,650 1,069,883 1,487,391
Total $15,119,294 $18,931,735 $28,378,692 $35,739,767
Intersegment Sales
Musical Instruments $ 24,536 $ 105,948 $ 40,827 $ 179,990
Data Communications 61,312 -- 193,438 --
Electronic Assemblies -- -- -- 15,577
Audio Equipment 9,274 5,750 19,401 6,932
Total $ 95,122 $ 111,698 $ 253,666 $ 202,499
Income (Loss) from Operations
Musical Instruments $ 261,047 $ 1,858,932 $ 675,188 $ 2,929,557
Data Communications (3,028,951) (563,261) (8,034,136) (503,429)
Electronic Assemblies 146,244 472,033 433,632 599,458
Audio Equipment (98,597) 19,322 (309,670) (228,704)
Total $(2,720,257)$ 1,787,026 $(7,234,986)$ 2,796,882
Musical Instruments Segment
Sales decreased $1,529,051 and $2,277,277 respectively, for the three
and six months ended June 30, 2001 when compared to the same periods in
2000. While the order rate for the first half of 2001 was approximately
equal to 2000, the first half of 2000 sales were higher due to shipments
made against a higher order backlog in 2000.
The gross profit percentage decreased to 25% and 27% respectively, in
the three and six months ended June 30, 2001 from 41% and 39% respectively
in the same periods in 2000. These decreases are due to lower sales over
which to absorb fixed costs and changes in product mix.
Selling, general and administrative, research and development expenses
decreased slightly during the three and six months ended June 30, 2001 when
compared to the same periods in 2000.
Data Communications Segment
Sales decreased $2,562,357 and $7,020,430 respectively, for the three
and six months ended June 20, 2001 when compared to the same periods in
2000, resulting in significant operating losses in both periods. This
segment's order rate in the first half of 2001 was significantly lower than
the same period in 2000. The Company expects lower sales, as compared to
the previous year, to continue through the balance of the year and has
implemented plans, discussed below, to improve operating results. The
sales decrease is attributable to a general slowdown in the national
economy and a more significant industry-wide slowdown in the Data
Communications markets. Some of this segment's products are sold to
Competitive Local Exchange Carriers (CLEC) that have been especially hard
hit by the economic down-turn, with many having difficulty raising capital
required to continue to build out their networks (purchase equipment) and
deliver services.
Gross profit margins decreased to 34% and 32% respectively during the
three and six months ended June 30, 2001 from 46% and 48% during the same
periods in 2000 due to the lower sales volume over which to absorb fixed
costs and competitive pressures to lower selling prices of products. Cost
of goods sold for the three and six months ended June 30, 2001 includes
$360,000 and $720,000 respectively, of additional inventory valuation
adjustments recorded at VIR, Inc. for slow moving and obsolete inventory
associated with discontinued product lines. The Company continues to
review the VIR inventory and product lines, which may result in additional
inventory valuation adjustments in future periods.
Sales and marketing expenditures decreased slightly during the three and
six months ended June 30, 2001 when compared to the same periods in 2000.
General and administrative expenses increased approximately $140,000
(10%) during the six months ended June 30, 2001 and decreased $80,000 (10%)
during the three months ended June 30, 2001 when compared to the same
periods in 2000.
Research and development expenditures increased approximately $366,000
(25%) and $886,000 (32%) respectively for the three and six months ended
June 30, 2001 when compared to the same periods in 2000.
As discussed in Note 2 above, the first quarter of 2001 and six months
ended June 30, 2001 operating expenses includes a charge of $1,400,000
related to the write down of the value of VIR's goodwill.
In April 2001 the Company announced plans for restructuring its Data
Communications segment. The Company is combining the VIR operations,
located in Southampton, PA into ERI with the combined operations being
headquartered in Moorestown, NJ. The Southampton, PA facility will be
closed later this year. Manufacture of some of VIR's products will be
moved to ERI's supplier with other manufacturing being transferred to the
Macungie, PA plant. VIR employs about 30 people with some being
transferred to the Moorestown facility. See Note 3 above for additional
information on this plant closing.
Because of the economic down-turn that resulted in this segment's
significant reduction in sales volume the Company has taken other steps to
reduce its expenditures for this segment. ERI reduced its workforce by 10
positions during the first quarter of 2001 resulting in severance and
related costs of approximately $100,000. In April of 2001 ERI reduced its
workforce by an additional 11 positions. These additional terminations
along with the VIR plant closure costs discussed above resulted in a total
restructuring charge for the Data Communications segment of $640,000 which
is included in the operating results of the second quarter of 2001. In
addition this segment has reduced its planned operating and capital
expenditures for the balance of the year.
The Company's Data Communications segment is also redirecting its sales
and marketing efforts. In recent years ERI has had significant growth for
its DACS product line in the CLEC market, which has been significantly
affected by the economic problems discussed above. ERI has more recently
focused on healthier markets for which the DNX is suited, including the
wireless and certain international markets. While initial results are
promising, the long sales cycles involved in DNX sales will require a
couple of quarters for this program to be evaluated.
The Company's Data Communications segment has introduced significant new
products including the DNX-88 and an OCS/STM1 interface card for the DNX
line, the first optical product for ERI. The DNX-88 system scales from 8
to 688 T1/E1 interfaces. It leverages all narrowband and broadband
interfaces within the current DNX portfolio, including T1/E1, T3, STS1 and
OC3/STM1, while retaining its ability to groom multiservice traffic by
performing non-blocking 3-1-0 cross connections. These products are well
positioned for the markets listed in the previous paragraph.
With the cost reductions and new markets focus listed above the Company
previously announced that it plans for the Data Communications segment to
approach breakeven from operations in the last quarter of 2001. The
Company is currently on the path for achieving this goal. However, the
current economic and market conditions make future sales visibility
problematic, which could jeopardize achievement of this goal.
Electronic Assemblies Segment
Sales increased $564,635 and $2,354,140 respectively for the three and
six months ended June 30, 2001 when compared to the same periods in 2000.
During the second quarter, some of the Company's contract manufacturing
customers have been affected by the current economic slowdown which will
lower sales for this segment during future quarters. Gross profit
percentages for the three and six months ended decreased to approximately
11% as compared to 20% during the same periods in 2000. These decreases
are due to changes in product mix.
Selling, general and administrative expenses in the three and six months
ended June 30, 2001 increased slightly when compared to the same periods in
2000.
Audio Equipment Segment
Sales decreased $285,668 and $417,508 for the three and six months ended
June 30, 2001 when compared to the same periods in 2000. Gross profit
margins were 38% and 35% respectively, in the three and six months ended
June 30, 2001 as compared to 38% in the same periods in 2000.
Selling, general and administrative costs decreased slightly during the
three and six months ended June 30, 2001 when compared to the same period
in 2000.
Legacy Audio has historically sold its products through a direct
marketing program. The Company believes that this method of distribution
has limited its ability to penetrate the broader market. Legacy has begun
implementing plans to distribute its products through a more traditional
dealer network. The Company will add dealers in a conservative manner
beginning in the third quarter of this year. During this period Legacy
will begin shifting marketing resources to the new method of distribution.
This may result in a sales decrease in direct sales that will not be offset
until the new dealers begin selling the Company's products.
Other Income and Expense
Investment income increased during the three and six months ended June
30, 2001 when compared to the same period in 2000 due to higher invested
balances and higher rates of return available on invested funds.
Factors that May Affect Operating Results
The statements contained in this report on Form 10-Q that are not purely
historical are forward looking statements within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934, including statements regarding the Company's expectations,
hopes, intentions or strategies regarding the future. Forward looking
statements include: statements regarding future products or product
development; statements regarding future research and development spending
and the Company's marketing and product development strategy, statements
regarding future production capacity. All forward looking statements
included in this document are based on information available to the Company
on the date hereof, and the Company assumes no obligation to update any
such forward looking statements. Readers are cautioned not to place undue
reliance on these forward looking statements, which reflect management's
opinions only as of the date hereof. Readers should carefully review the
risk factors described in other documents the Company files from time to
time with the Securities and Exchange Commission, including the Annual
Report on Form 10-K. It is important to note that the Company's actual
results could differ materially from those in such forward looking
statements. Some of the factors that could cause actual results to differ
materially are set forth below.
The Company has experienced and expects to continue to experience
fluctuations in its results of operations. Factors that affect the
Company's results of operations include the volume and timing of orders
received, changes in global economics and financial markets, changes in the
mix of products sold, market acceptance of the Company's and its customer's
products, competitive pricing pressures, global currency valuations, the
availability of electronic components that the Company purchases from
suppliers, the Company's ability to meet increasing demand, the Company's
ability to introduce new products on a timely basis, the timing of new
product announcements and introductions by the Company or its competitors,
changing customer requirements, delays in new product qualifications, the
timing and extent of research and development expenses and fluctuations in
manufacturing yields. As a result of the foregoing or other factors, there
can be no assurance that the Company will not experience material
fluctuations in future operating results on a quarterly or annual basis,
which would materially and adversely affect the Company's business,
financial condition and results of operations.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
No change from information disclosed in the Company's 2000 annual
report of form 10-K.
PART II OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
(a) Annual Meeting: April 26, 2001
(b) Election of the following directors for a one-year term:
Steven Markowitz, Eugene Moroz, Leonard Helfrich, Martha
Markowitz, Orville Hawk, Albert Schuster, Jeffrey Schucker,
Ernest Choquette and Michael Doyle.
(c) In addition to the election of directors and the waiver of
reading of the minutes of the prior meeting, the shareholders
ratified charitable deductions made in 2000 and all contracts,
agreements, and employments by the Board of Directors and
officers since the previous annual meeting in April 2000. All
resolutions were adopted by the vote of all shareholders
present, in person or proxy.
Item 5. Other Information
Michael F. Doyle was elected a Director at the annual
shareholders meeting on April 26, 2001. Mr. Doyle is President
of the Company's subsidiary Eastern Research, Inc. Prior to
joining ERI in May of 1997, Mr. Doyle had 20-years experience
in the data communications industry including positions at
Infotron Systems, Inc., Dowty Communications, Inc., Teleos
Communications, Inc. and Madge Networks, Inc.
Item 6. Exhibits and Reports on Form 8-K
(b) Forms 8-K
1.The Company filed a Form 8-K dated April 20, 2001
announcing the combination of its Data Communications
subsidiaries VIR Linear Switch into Eastern Research, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Allen Organ Company
(Registrant)
Date: August 8, 2001 /s/ STEVEN MARKOWITZ
Steven Markowitz, President and Chief
Executive Officer
Date: August 8, 2001 /s/ NATHAN S. ECKHART
Nathan S. Eckhart, Vice President-Finance,
Chief Financial and Principal Accounting
Officer