Seneca Foods Corporation 3736 South Main Street Marion, NY 14505 February 10, 2003 VIA EDGAR Securities and Exchange Commission Division of Corporate Finance 450 Fifth Street, NW Washington, DC 20549 Ladies and Gentlemen: Pursuant to the requirements of the Securities Exchange Act of 1934, we are transmitting herewith the attached Form 10-Q for the nine month period ended December 28, 2002. Sincerely, SENECA FOODS CORPORATION /s/Jeffrey L. Van Riper Jeffrey L. Van Riper Controller and Chief Accounting Officer Form 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended December 28, 2002 Commission File Number 0-1989 ----------------- ------ Seneca Foods Corporation ------------------------ (Exact name of Company as specified in its charter) New York 16-0733425 -------- ---------- (State or other jurisdiction of (I. R. S. Employer incorporation or organization) Identification No.) 3736 South Main Street, Marion, New York 14505 ---------------------------------------- ----- (Address of principal executive offices) (Zip Code) Company's telephone number, including area code 315/926-8100 ------------ Not Applicable -------------- Former name, former address and former fiscal year, if changed since last report Check mark indicates whether Company (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the preceding 12 months (or for such shorter period that the Company was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ------ ------- The number of shares outstanding of each of the issuer's classes of common stock at the latest practical date are: Class Shares Outstanding at January 31, 2003 Common Stock Class A, $.25 Par 3,827,288 Common Stock Class B, $.25 Par 2,764,053 PART I ITEM 1 FINANCIAL INFORMATION SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (In Thousands of Dollars) 12/28/02 3/31/02 -------- ------- ASSETS Current Assets: Cash and Cash Equivalents $ 75,978 $ 24,973 Accounts Receivable, Net 32,440 32,035 Inventories: Finished Goods 140,450 135,727 Work in Process 22,844 8,526 Raw Materials 20,713 37,582 ------- ------- 184,007 181,835 Off-Season Reserve (Note 2) (43,140) - Deferred Income Tax Asset, Net 2,521 4,624 Refundable Income Taxes 2,135 1,657 Other Current Assets 2,113 362 -------------- --------------- Total Current Assets 256,054 245,486 Property, Plant and Equipment, Net 140,876 155,189 Other Assets 2,916 2,901 -------------- --------------- $399,846 $403,576 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts Payable $ 27,315 $ 33,979 Accrued Expenses 24,855 25,078 Current Portion of Long-Term Debt and Capital Lease Obligations 22,940 22,823 --------------- --------------- Total Current Liabilities 75,110 81,880 Long-Term Debt 144,600 149,430 Capital Lease Obligations 6,230 6,670 Deferred Income Tax Liability 9,153 7,308 Other Long-Term Liabilities 6,465 7,165 10% Preferred Stock, Series A, Voting, Cumulative, Convertible, $.025 Par Value Per Share 10 10 10% Preferred Stock, Series B, Voting, Cumulative, Convertible, $.025 Par Value Per Share 10 10 6% Preferred Stock, Voting, Cumulative, $.25 Par Value 50 50 Convertible, Participating Preferred Stock, $12 Stated Value 42,556 42,605 Common Stock 2,829 2,827 Paid in Capital 13,668 13,619 Accumulated Other Comprehensive Income 1,226 1,208 Retained Earnings 97,939 90,794 --------------- --------------- Stockholders' Equity 158,288 151,123 --------------- --------------- $399,846 $403,576 ======== ======== <FN> The accompanying notes are an integral part of these financial statements. </FN> SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (In Thousands, except Share Data) Three Months Ended ------------------ 12/28/02 12/29/01 -------- -------- Net Sales $ 235,430 $ 236,932 Costs and Expenses: Cost of Product Sold 221,559 223,964 Selling, General, and Administrative 5,493 5,325 Interest Expense 3,343 4,018 ------------------ ----------------- Total Costs and Expenses 230,395 233,307 ------------------ ----------------- Earnings Before Income Taxes 5,035 3,625 Income Taxes 1,888 1,335 ------------------ ----------------- Net Earnings $ 3,147 $ 2,290 ================= ================ Basic: Earnings Per Common Share .48 .35 ================= ================ Diluted: Earnings Per Common Share .31 .22 ================== ================ <FN> The accompanying notes are an integral part of these condensed financial statements. </FN> SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (In Thousands, except Share Data) Nine Months Ended ----------------- 12/28/02 12/29/01 -------- -------- Net Sales $ 542,491 $ 546,425 Costs and Expenses: Cost of Product Sold 504,680 516,112 Selling, General, and Administrative 14,980 15,483 Other Expense 620 321 Interest Expense 10,583 13,543 ------------------ ----------------- Total Costs and Expenses 530,863 545,459 ------------------ ----------------- Earnings Before Income Taxes 11,628 966 Income Taxes 4,459 378 ------------------ ----------------- Net Earnings $ 7,169 $ 588 ================= ================ Basic: Earnings Per Common Share 1.09 .09 ================== ================ Diluted: Earnings Per Common Share .70 .06 ================== ================ <FN> The accompanying notes are an integral part of these condensed financial statements. </FN> SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (In Thousands) Nine Months Ended ----------------- 12/28/02 12/29/01 -------- -------- Cash Flows From Operations: Net Earnings $ 7,169 $ 588 Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: Depreciation and Amortization 17,091 18,287 Deferred Income Taxes 3,937 (108) Impairment provision and Other Expenses 620 321 Changes in Working Capital: Accounts Receivable (405) (3,873) Inventories (2,172) (8,702) Off-Season Reserve 43,140 45,576 Other Current Assets (1,651) 41 Refundable Income Taxes (478) (532) Accounts Payable, Accrued Expenses, and Other Liabilities (7,585) (13,319) ------------------ ----------------- Net Cash Provided by Operations 59,666 38,279 ------------------ ----------------- Cash Flows From Investing Activities: Additions to Property, Plant, and Equipment (3,513) (11,555) Capital Escrow - 1,316 Proceeds from the Sale of Assets 15 95 ------------------ ----------------- Net Cash Used in Investing Activities (3,498) (10,144) ------------------ ----------------- Cash Flows From Financing Activities: Payments of Long-Term Debt and Capital Lease Obligations (5,318) (4,814) Proceeds from the Issuance of Long-Term Debt 165 8,079 Other 14 14 Net Borrowings on Notes Payable - (24,500) Dividends (24) (24) ------------------ ----------------- Net Cash Used in Financing Activities (5,163) (21,245) ------------------ ----------------- Net Increase in Cash and Short- Term Investments 51,005 6,890 Cash and Cash Equivalents, Beginning of Period 24,973 5,391 ------------------ ----------------- Cash and Cash Equivalents, End of Period $ 75,978 $ 12,281 ================== ================== <FN> The accompanying notes are an integral part of these condensed financial statements. </FN> SENECA FOODS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS December 28, 2002 1. Consolidated Condensed Financial Statements In the opinion of management, the accompanying unaudited consolidated condensed financial statements contain all adjustments, which are normal and recurring in nature, necessary to present fairly the financial position of the Company as of December 28, 2002 and results of its operations and its cash flows for the interim periods presented. All significant intercompany transactions and accounts have been eliminated in consolidation. The March 31, 2002 balance sheet was derived from audited financial statements. The results of operations for the three and nine month periods ended December 28, 2002 and December 29, 2001 are not necessarily indicative of the results to be expected for the full year. The accounting policies followed by the Company are set forth in Note 1 to the Company's financial statements in the 2002 Seneca Foods Corporation Annual Report and Form 10-K. Other footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these consolidated condensed financial statements be read in conjunction with the financial statements and notes included in the Company's 2002 Annual Report and Form 10-K. 2. Off-Season Reserve is the excess of absorbed expenses over incurred expenses to date. During the first quarter of each year, incurred expenses exceed absorbed expenses due to timing of production. The seasonal nature of the Company's Food Processing business results in a timing difference between expenses (primarily overhead expenses) incurred and absorbed into product cost. All Off-Season Reserve balances are zero at fiscal year end. 3. Comprehensive income consisted solely of Net Earnings and Net Unrealized Gain Change on Moog, Inc. Stock. The following table provides the results for the periods presented: Nine Months Ended ----------------- 12/28/02 12/29/01 -------- -------- Net Earnings $7,169 $588 Other Comprehensive Earnings, Net of Tax: Net Unrealized Gain Change on Investment 18 16 --------------------- Comprehensive Earnings $7,187 $604 ==================== 4. Recently Issued Accounting Standards In July 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with Exit and Disposal Activities. This statement revises the accounting for exit and disposal activities under EITF Issue No. 94-3, Liability Recognition for Certain Employee Termination Benefits and other Costs to Exit an Activity, by spreading out the reporting of expenses related to restructuring activities. Commitment to a plan to exit an activity or dispose of long-lived assets will no longer be sufficient to record a one-time charge for most anticipated costs. Instead, companies will record exit or disposal costs when they are "incurred" and can be measured at fair value, and they will subsequently adjust the recorded liability for changes in estimated cash flows. The provisions of SFAS No. 146 are effective prospectively for exit or disposal activities initiated after December 31, 2002. Companies may not restate previously issued financial statements for the effect of the provisions of SFAS No. 146 and liabilities that a company previously recorded under EITF Issue 94-3 are grandfathered. The Company does not expect the adoption of SFAS No. 146 to have a material impact on its consolidated financial statements. ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION RESULTS AND OF OPERATIONS December 28, 2002 Results of Operations: Sales: Total sales reflect a decrease of 0.6% for the third quarter versus 2001. For the nine month period, total sales decreased 0.7%, of which Non-Alliance and Alliance sales both decreased 0.7% versus the same period last year. Costs and Expenses: The following table shows costs and expenses as a percentage of sales: Three Months Ended Nine Months Ended 12/28/02 12/29/01 12/28/02 12/29/01 -------- -------- ------- -------- Cost of Product Sold 94.2% 94.5% 93.0% 94.4% Selling 2.0 1.9 2.3 2.3 Other Expense 0.0 0.0 0.1 0.1 Administrative 0.3 0.4 0.5 0.5 Interest Expense 1.4 1.7 2.0 2.5 ---------------------------------------------------- 97.9% 98.5% 97.9% 99.8% ==================================================== Higher selling prices as compared to the prior year, especially in the Private Label Retail Canned, Frozen and Branded businesses, were a major contributing factor in improved operating results. In addition, interest expense decreased $675,000 for the third quarter as a result of lower interest rates and lower average debt balances. Other expense in the nine months period is an impairment charge while in the prior period, other expense is a severance accrual. Income Taxes: The effective tax rate was 38% in 2002 and 39% in 2001. Financial Condition: The financial condition of the Company is summarized in the following table and explanatory review (In Thousands): For the Quarter For the Year Ended December Ended March -------------- ----------- 2002 2001 2002 2001 ---- ---- ---- ---- Working Capital Balance $180,944 $173,963 $163,606 $163,367 Quarter Change 1,773 4,500 - - Notes Payable - - - 24,500 Long-Term Debt 150,830 173,792 156,100 171,346 Current Ratio 3.41:1 3.38:1 3.00:1 2.49:1 The change in Working Capital for the December 2002 quarter from the December 2001 quarter is largely due to new debt issued in 2001 of $1.0 million and lower deferred taxes of $0.9 million. This was partially offset by higher earnings in the current year quarter than the prior year quarter ($3,147,000 earnings as compared to $2,290,000 earnings last year). See Consolidated Condensed Statements of Cash Flows for further details. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS December 28, 2002 Inventory decreased $53.9 million from the same period last year reflecting the Company's continued emphasis on inventory management and the reduced pack. Cash and short term investments increased $63.7 million from the same period last year primarily due to the inventory reduction and earnings from operations. Forward-Looking Statements Except for the historical information contained herein, the matters discussed in this report are forward-looking statements as defined in the Private Securities Litigation Reform Act (PSLRA) of 1995. The Company wishes to take advantage of the "safe harbor" provisions of the PSLRA by cautioning that numerous important factors which involve risks and uncertainties, including but not limited to economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services and prices, and other factors discussed in the Company's filings with the Securities and Exchange Commission, in the future, could affect the Company's actual results and could cause its actual consolidated results to differ materially from those expressed in any forward-looking statement made by, or on behalf of, the Company. Critical Accounting Policies In the first nine months ended December 28, 2002, the Company sold for cash, on a bill and hold basis, $214,246,000 of Green Giant finished goods inventory to General Mills Operations, Inc. ("GMOI"). At the time of the sale of the Green Giant vegetables to GMOI, title of the specified inventory transferred to GMOI. In addition, the aforementioned finished goods inventory was complete, ready for shipment and segregated from the Company's other finished goods inventory. Further, the Company had performed all of its obligations with respect to the sale of the specified Green Giant finished goods inventory. Off-Season Reserve is the excess of absorbed expenses over incurred expenses to date. During the first quarter of each year, incurred expenses exceed absorbed expenses due to timing of production. The seasonal nature of the Company's Food Processing business results in a timing difference between expenses (primarily overhead expenses) incurred and absorbed into product cost. All Off-Season Reserve balances are zero at fiscal year end. Trade promotions are an important component of the sales and marketing of the Company's branded products, and are critical to the support of the business. Trade promotion costs include amounts paid to encourage retailers to offer temporary price reductions for the sale of our products to consumers, amounts paid to obtain favorable display positions in retailers' stores, and amounts paid to retailers for shelf space in retail stores. Accruals for trade promotions are recorded primarily at the time of sale of product to the retailer based on expected levels of performance. Settlement of these liabilities typically occurs in subsequent periods primarily through an authorized process for deductions taken by a retailer from amounts otherwise due to us. As a result, the ultimate cost of a trade promotion program is dependent on the relative success of the events and the actions and level of deductions taken by retailers for amounts they consider due to them. Final determination of the permissible deductions may take extended periods of time. Alliance Agreement Amendment On May 23, 2002, the Company, The Pillsbury Company, General Mills Operations, Inc. and General Mills, Inc. entered into an amendment to the Alliance Agreement pursuant to which certain provisions were modified to (i) assign Pillsbury's rights and obligations under the Alliance Agreement to General Mills Operations, Inc. ("GMOI"), which is an indirect, wholly-owned subsidiary of General Mills, Inc.; (ii) accelerate the timing of the obligation of GMOI to purchase Green Giant inventory from the Company by requiring that such inventory be purchased at the end of each commodity production cycle (e.g. corn, peas, green beans, and asparagus); and (iii) substitute General Mills, Inc. for Diageo PLC as the guarantor of GMOI's obligations under the Alliance Agreement. Recently Issued Accounting Standards In July 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with Exit and Disposal Activities. This statement revises the accounting for exit and disposal activities under EITF Issue No. 94-3, Liability Recognition for Certain Employee Termination Benefits and other Costs to Exit an Activity, by spreading out the reporting of expenses related to restructuring activities. Commitment to a plan to exit an activity or dispose of long-lived assets will no longer be sufficient to record a one-time charge for most anticipated costs. Instead, companies will record exit or disposal costs when they are "incurred" and can be measured at fair value, and they will subsequently adjust the recorded liability for changes in estimated cash flows. The provisions of SFAS No. 146 are effective prospectively for exit or disposal activities initiated after December 31, 2002. Companies may not restate previously issued financial statements for the effect of the provisions of SFAS No. 146 and liabilities that a company previously recorded under EITF Issue 94-3 are grandfathered. The Company does not expect the adoption of SFAS No. 146 to have a material impact on its consolidated financial statements. ITEM 3 Quantitative and Qualitative Disclosures about Market Risk The Company has not experienced any material changes in Market Risk since our March 31, 2002 report. ITEM 4 Controls and Procedures (a) Disclosure controls and procedures. Within 90 days before filing this report, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures. Our disclosure controls and procedures are the controls and other procedures that we designed to ensure that we record, process, summarize and report in a timely manner the information we must disclose in reports that we file with or submit to the SEC. Kraig H. Kayser, our President and Chief Executive Officer, and Philip G. Paras, our Chief Financial Officer, reviewed and participated in this evaluation. Based on this evaluation, Messrs. Kayser and Paras concluded that, as of the date of their evaluation, our disclosure controls were effective. (b) Internal controls. Since the date of the last evaluation, there have not been any significant changes in our internal accounting controls or in other factors that could significantly affect those controls. PART II - OTHER INFORMATION Item 1. Legal Proceedings None. Item 2. Changes in Securities None. Item 3. Defaults on Senior Securities None. Item 4. Submission of Matters to a Vote of Security Holders None. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K A. Exhibits 11 (11) Computation of earnings per share (filed herewith) (b) Reports on Form 8-K (1) Form 8-K Filed November 8, 2002 Regulation FD Disclosure. Certifications by the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 to accompany the Quarterly Report on Form 10-Q for the quarterly period ended September 28, 2002. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Seneca Foods Corporation (Company) /s/Kraig H. Kayser -------------------------- February 10, 2003 Kraig H. Kayser President and Chief Executive Officer /s/Jeffrey L. Van Riper -------------------------- February 10, 2003 Jeffrey L. Van Riper Controller and Chief Accounting Officer CERTIFICATIONS I, Kraig H. Kayser, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Seneca Foods Corporation; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Dated: February 10, 2003 By: /s/Kraig H. Kayser --------------------------------- Kraig H. Kayser President and Chief Executive Officer I, Philip G. Paras, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Seneca Foods Corporation; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Dated: February 10, 2003 By: /s/Philip G. Paras -------------------------------- Philip G. Paras Chief Financial Officer EXHIBIT 11 SENECA FOODS CORPORATION AND SUBSIDIARIES COMPUTATION OF EARNINGS PER SHARE (In thousands except share data) Three Months Ended Nine Months Ended ------------------ ----------------- 12/28/02 12/29/01 12/28/02 12/29/01 -------- -------- -------- -------- Basic Net Earnings Applicable to Common Stock: Net Earnings $ 3,147 $ 2,290 $ 7,169 $ 588 Deduct Preferred Cash Dividends 6 6 18 18 --------------------------------------------------------------- Net Earnings Applicable to Common Stock $ 3,141 $ 2,284 $ 7,151 $ 570 ================================================================ Weighted Average Common Shares Outstanding for Basic Earnings per Share 6,591 6,585 6,590 6,584 ================================================================ Basic Earnings Per Share $ .48 $ .35 $ 1.09 $ .09 ================================================================ Diluted Net Earnings Applicable to Common Stock: Net Earnings Applicable to Common Stock $ 3,141 $ 2,284 $ 7,151 $ 570 Add Back Preferred Cash Dividends 5 5 15 15 ---------------------------------------------------------------- Net Earnings Applicable to Common Stock $ 3,146 $ 2,289 $ 7,166 $ 585 ================================================================ Weighted Average Common Shares Outstanding 6,591 6,585 6,590 6,584 Effect of Convertible Preferred Stock 3,634 3,640 3,635 3,641 ---------------------------------------------------------------- Weighted Average Common Shares Outstanding for Diluted Earnings per Share 10,225 10,225 10,225 10,225 ================================================================ Diluted Earnings Per Share $ .31 $ .22 $ .70 $ .06 ================================================================